Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 88211 October 27, 1989
FERDINAND E. MARCOS, IMELDA R. MARCOS, FERDINAND R. MARCOS. JR., IRENE M.
ARANETA, IMEE M. MANOTOC, TOMAS MANOTOC, GREGORIO ARANETA, PACIFICO E.
MARCOS, NICANOR YIGUEZ and PHILIPPINE CONSTITUTION ASSOCIATION (PHILCONSA),
represented by its President, CONRADO F. ESTRELLA, petitioners,
vs.
HONORABLE RAUL MANGLAPUS, CATALINO MACARAIG, SEDFREY ORDOEZ, MIRIAM
DEFENSOR SANTIAGO, FIDEL RAMOS, RENATO DE VILLA, in their capacity as Secretary of
Foreign Affairs, Executive Secretary, Secretary of Justice, Immigration Commissioner, Secretary of
National Defense and Chief of Staff, respectively, respondents.
RESOLUTION

EN BANC:
In its decision dated September 15,1989, the Court, by a vote of eight (8) to seven (7), dismissed the petition,
after finding that the President did not act arbitrarily or with grave abuse of discretion in determining that the
return of former President Marcos and his family at the present time and under present circumstances pose a
threat to national interest and welfare and in prohibiting their return to the Philippines. On September 28, 1989,
former President Marcos died in Honolulu, Hawaii. In a statement, President Aquino said:
In the interest of the safety of those who will take the death of Mr. Marcos in widely and
passionately conflicting ways, and for the tranquility of the state and order of society, the
remains of Ferdinand E. Marcos will not be allowed to be brought to our country until such time
as the government, be it under this administration or the succeeding one, shall otherwise decide.
[Motion for Reconsideration, p. 1; Rollo, p, 443.]
On October 2, 1989, a Motion for Reconsideration was filed by petitioners, raising the following major
arguments:
1. to bar former President Marcos and his family from returning to the Philippines is to deny them not only the
inherent right of citizens to return to their country of birth but also the protection of the Constitution and all of
the rights guaranteed to Filipinos under the Constitution;
2. the President has no power to bar a Filipino from his own country; if she has, she had exercised it arbitrarily;
and
3. there is no basis for barring the return of the family of former President Marcos. Thus, petitioners prayed that
the Court reconsider its decision, order respondents to issue the necessary travel documents to enable Mrs.
Imelda R. Marcos, Ferdinand R. Marcos, Jr., Irene M. Araneta, Imee M. Manotoc, Tommy Manotoc and
Gregorio Araneta to return to the Philippines, and enjoin respondents from implementing President Aquino's
decision to bar the return of the remains of Mr. Marcos, and the other petitioners, to the Philippines.

Commenting on the motion for reconsideration, the Solicitor General argued that the motion for reconsideration
is moot and academic as to the deceased Mr. Marcos. Moreover, he asserts that "the 'formal' rights being
invoked by the Marcoses under the label 'right to return', including the label 'return of Marcos' remains, is in
reality or substance a 'right' to destabilize the country, a 'right' to hide the Marcoses' incessant shadowy
orchestrated efforts at destabilization." [Comment, p. 29.] Thus, he prays that the Motion for Reconsideration be
denied for lack of merit.
We deny the motion for reconsideration.
1. It must be emphasized that as in all motions for reconsideration, the burden is upon the movants, petitioner
herein, to show that there are compelling reasons to reconsider the decision of the Court.
2. After a thorough consideration of the matters raised in the motion for reconsideration, the Court is of the
view that no compelling reasons have been established by petitioners to warrant a reconsideration of the Court's
decision.
The death of Mr. Marcos, although it may be viewed as a supervening event, has not changed the factual
scenario under which the Court's decision was rendered. The threats to the government, to which the return of
the Marcoses has been viewed to provide a catalytic effect, have not been shown to have ceased. On the
contrary, instead of erasing fears as to the destabilization that will be caused by the return of the Marcoses, Mrs.
Marcos reinforced the basis for the decision to bar their return when she called President Aquino "illegal,"
claiming that it is Mr. Marcos, not Mrs. Aquino, who is the "legal" President of the Philippines, and declared
that the matter "should be brought to all the courts of the world." [Comment, p. 1; Philippine Star, October 4,
1989.]
3. Contrary to petitioners' view, it cannot be denied that the President, upon whom executive power is vested,
has unstated residual powers which are implied from the grant of executive power and which are necessary for
her to comply with her duties under the Constitution. The powers of the President are not limited to what are
expressly enumerated in the article on the Executive Department and in scattered provisions of the Constitution.
This is so, notwithstanding the avowed intent of the members of the Constitutional Commission of 1986 to limit
the powers of the President as a reaction to the abuses under the regime of Mr. Marcos, for the result was a
limitation of specific power of the President, particularly those relating to the commander-in-chief clause,
but not a diminution of the general grant of executive power.
That the President has powers other than those expressly stated in the Constitution is nothing new. This is
recognized under the U.S. Constitution from which we have patterned the distribution of governmental powers
among three (3) separate branches.
Article II, [section] 1, provides that "The Executive Power shall be vested in a President of the
United States of America." In Alexander Hamilton's widely accepted view, this statement cannot
be read as mere shorthand for the specific executive authorizations that follow it in [sections] 2
and 3. Hamilton stressed the difference between the sweeping language of article II, section 1,
and the conditional language of article I, [section] 1: "All legislative Powers herein granted shall
be vested in a Congress of the United States . . ." Hamilton submitted that "[t]he [article III
enumeration [in sections 2 and 31 ought therefore to be considered, as intended merely to specify
the principal articles implied in the definition of execution power; leaving the rest to flow from
the general grant of that power, interpreted in confomity with other parts of the Constitution...
In Myers v. United States, the Supreme Court accepted Hamilton's proposition, concluding
that the federal executive, unlike the Congress, could exercise power from sources not
enumerated, so long as not forbidden by the constitutional text: the executive power was given in
general terms, strengthened by specific terms where emphasis was regarded as appropriate, and

was limited by direct expressions where limitation was needed. . ." The language of Chief Justice
Taft in Myers makes clear that the constitutional concept of inherent power is not a synonym for
power without limit; rather, the concept suggests only that not all powers granted in the
Constitution are themselves exhausted by internal enumeration, so that, within a sphere properly
regarded as one of "executive' power, authority is implied unless there or elsewhere expressly
limited. [TRIBE, AMERICAN CONSTITUTIONAL LAW 158-159 (1978).]
And neither can we subscribe to the view that a recognition of the President's implied or residual powers is
tantamount to setting the stage for another dictatorship. Despite petitioners' strained analogy, the residual
powers of the President under the Constitution should not be confused with the power of the President under the
1973 Constitution to legislate pursuant to Amendment No. 6 which provides:
Whenever in the judgment of the President (Prime Minister), there exists a grave emergency or a
threat or imminence thereof, or whenever the interim Batasang Pambansa or the regular National
Assembly fails or is unable to act adequately on any matter for any reason that in his judgment
requires immediate action, he may, in order to meet the exigency, issue the necessary decrees,
orders, or letters of instruction, which shall form part of the law of the land,
There is no similarity between the residual powers of the President under the 1987 Constitution and the power
of the President under the 1973 Constitution pursuant to Amendment No. 6. First of all, Amendment No. 6
refers to an express grant of power. It is not implied. Then, Amendment No. 6 refers to a grant to the President
of thespecific power of legislation.
4. Among the duties of the President under the Constitution, in compliance with his (or her) oath of office, is to
protect and promote the interest and welfare of the people. Her decision to bar the return of the Marcoses and
subsequently, the remains of Mr. Marcos at the present time and under present circumstances is in compliance
with this bounden duty. In the absence of a clear showing that she had acted with arbitrariness or with grave
abuse of discretion in arriving at this decision, the Court will not enjoin the implementation of this decision.
ACCORDINGLY, the Court resolved to DENY the Motion for Reconsideration for lack of merit."

Separate Opinions

CRUZ, J., dissenting:

Nothing important has happened to change my vote for granting the petition. The death of Marcos has not
plunged the nation into paroxysms of grief as the so-called "loyalists" had hoped. By and large, it has been met
with only passing interest if not outright indifference from the people. Clearly, the discredited dictator is in
death no El Cid. Marcos dead is only an unpleasant memory, not a bolt of lightning to whip the blood.
This only shows that if he was at all a threat to the national security when he was already moribund that feeble
threat has died with him. As the government stresses, he has been reduced to a non-person (which makes me
wonder why it is still afraid of him). His cadaver is not even regarded as a symbol of this or that or whatever
except by his fanatical followers. It is only a dead body waiting to be interred in this country.
This is a tempest in a teapot. We have more important things to do than debating over a corpse that deserves no
kinder fate than dissolution and oblivion. I say let it be brought home and buried deep and let us be done with it
forever.

PARAS, J., dissenting on the Motion for Reconsideration:

I find no reason to deviate from the dissenting opinion I have already expressed.
Firstly, the former President, although already dead, is still entitled to certain rights. It is not correct to say that a
dead man, since he is no longer a human being, has ceased to have rights. For instance, our Revised Penal Code
prohibits the commission of libel against a deceased individual. And even if we were to assume the nonexistence anymore of his human rights what about the human rights of his widow and the other members of his
family?
Secondly, up to now, the alleged threats to national security have remained unproved and consequently,
unpersuasive. Our Armed Forces can easily control any possible uprising or political and military
destabilization. In fact, the converse appears to be nearer the truth, that is, if we do not allow the remains to
come, more trouble may be expected.
Thirdly, reconciliation can proceed at a much faster pace if the petition for the return is granted. To refuse the
request can mean a hardening of resistance against the well-intentioned aim of the administration. Upon the
other hand, to grant the petition may well soften the hearts of the oppositionists; paving the way for a united
citizenry.
Finally, the entire world will surely applaud our government's act of mercy. As Shakespeare once wrote "the
quality of mercy is not strained." Surely, compassion is the better part of government. Remove mercy, and you
remove the best reason against civil strife, which if not abated can turn our country into a mainstream of fiery
dissent and in the end, as one great man has put it, the question will no longer be what is right, but what is left.
PADILLA, J., dissenting:
The death of former President Ferdinand E. Marcos, which supervened after decision in this case had been
rendered, was pre-empted and foreseen in my original dissenting opinion. There I said that the first cogent and
decisive proposition in this case is that "Mr. Marcos is a Filipino and, as such, entitled to return to, die and be
buried in this country." I have only to add a few statements to that dissenting opinion.
Respondents have succeeded in denying Mr. Marcos the first two (2) rights, i.e. to return to and die in this
country, The remaining right of this Filipino that cries out for vindication at this late hour is the right to be
buried in this country. Will the respondents be allowed to complete the circle of denying the constitutional and
human right of Mr. Marcos to travel which, as stated in my dissenting opinion, includes the right to return to,
die and be buried in this country? The answer should be in the negative if the Constitution is to still prevail; the
answer should be in the negative if we are to avoid the completely indefensible act of denying a Filipino the last
right to blend his mortal remains with a few square feet of earth in the treasured land of his birth.
Those who would deny this Filipino the only constitutional and human right that can be accorded him now say
that the constitutional and human right to be buried in this country would apply to any Filipino, except Mr.
Marcos, because he was a dictator and he plundered the country. This is the most irrelevant argument that can
be raised at this time. For, our democracy is built on the fundamental assumption (so we believe) that the
Constitution and all its guarantees apply to all Filipinos, whether dictator or pauper, learned or ignorant,
religious or agnostic as long as he is a Filipino.
It is said that to accord this Filipino the right to be buried in this country would pose a serious threat to national
security and public safety. What threat? As pointed out in my dissenting opinion, the second cogent and
decisive proposition in this case is that respondents have not presented any "hard evidence" (factual bases) or
convincing proof of such threat. "All we have are general conclusions of national security and public safety' in

avoidance of a specific, demandable and enforceable constitutional and basic human right to return." Recent
events have, to my mind, served to confirm the validity of such dissenting statement.
If a live Marcos returning to this country did not pose a serious threat to national security, the situation cannot
be any worse with a dead Marcos returning. For, a dead Marcos will return to be buried into mother earth,
where there are no protests, "demos", or even dissents, where the rule that reigns, in the language of Mr. Justice
Jackson in Barnette is the "unanimity of the graveyard."
It is said that, while a dead Marcos has been rendered impotent to threaten national security, his supporters
would pose that threat to national security. This argument is untenable as it is without merit. As I see it, Marcos'
supporters pose a greater threat to peace and order, with Marcos deprived of his right to burial in this country.
On the other hand, if the remains of Mr. Marcos are brought to the country and allowed the burial to which he is
constitutionally and humanly entitled, Marcos' supporters would be deprived of an otherwise potent argument
so conducive to mass protests and even violencethat their Idol has been cruelly denied the right to be buried
in his homeland.
It is also said that Mr. Marcos, in cadaver form, has no constitutional or human rights, to speak of. This
contention entirely begs the issue. In the first place, one cannot overlook that the right of Mr. Marcos, as a
Filipino, to be buried in this country, is asserted not for the first time after his death. It was vigorously asserted
long before his death. But, more importantly, the right of every Filipino to be buried in his country, is part of
a continuing right that starts from birth and ends only on the day he is finally laid to rest in his country.
This dissenting opinion does not pretend to deny the Philippine government the right to lay down conditions for
the burial of Mr. Marcos in this country, but I submit that these conditions must, as a fundamental postulate,
recognize the right of the man, as a Filipino, to be buried in this country NOW.
The majority resolution, in effect, bans Mr. Marcos' burial in this country now. Without in any way affecting
my respect and regard for my brethren and sisters in the majority, I am deeply concerned and greatly disturbed
that, with their decision banning a dead Marcos from burial in this country, they have passed an opportunity to
defuse a constitutional crisis that, in my humble assessment, threatens to ignite an already divided nation,
Regrettably, they have ignored the constitutional dimension of the problem rooted in the ageless and finest
tradition of our people for respect and deference to the dead. What predictably follows will be a continuing
strife, among our people, of unending hatred, recriminations and retaliations. God save this country!
My vote is for this Court to ORDER the respondents to allow the immediate return and burial in the Republic of
the Philippines of former President Ferdinand E. Marcos, subject to such conditions as the Philippine
government may impose in the interest of peace and order.
SARMIENTO, J., Dissenting:
The case has curious trappings of a deja vu, the shoe being on the other foot, yet, as I stated before, I can not
allow personal emotions to soften my "hardened impartiality" and deny, as a consequence, the rights of the exPresident's bereaved to bury his remains in his homeland, and for them to return from exile. As I had, then,
voted to grant the petition, so do I vote to grant reconsideration.
I have gone to lengths to locate in the four comers of the Constitution, by direct grant or by implication, the
President's supposed "residual" power to forbid citizens from entering the motherland reiterated in the
resolution of the majority. I have found none. I am not agreed, that:
3. Contrary to petitioners view, it cannot be denied that the President, upon whom executive
power is vested, has unstated residual powers which are implied from the grant of executive
power and which are necessary for her to comply with her duties under the Constitution. The

powers of the President are not limited to what are expressly enumerated in the article on the
Executive Department and in scattered provisions of the Constitution. This, notwithstanding the
avowed intent of the members of the Constitutional Commission of 1986 to limit the powers of
the President as a reaction to the abuses under the regime of Mr. Marcos, for the result was a
limitation of specific powers of the President, particularly those relating to the commander-inchief clause, but not a diminution of the general grant of executive power.
It is a nice word game, but it is nothing else. For, if the Constitution has imposed limitations on specific powers
of the President, it has, a fortiori, prescribed a diminution of executive power. The Charter says that the right
may only be restricted by: (1) a court order; or (2) by fiat of law. Had the fundamental law intended a
presidential imprimatur, it would have said so. It would have also completed the symmetry: judicial,
congressional, and executive restraints on the right. No amount of presumed residual executive power can
amend the Charter.
It is well to note that the Bill of Rights stands primarily, a limitation not only against legislative encroachments
on individual liberties, but more so, against presidential intrusions. And especially so, because the President is
the caretaker of the military establishment that has, several times over, been unkind to part of the population it
has also sworn to protect.
That "[t]he threats to the government, to which the return of the Marcoses has been viewed to provide a
catalytic effect, have not been shown to have ceased" (Res., 3) is the realm of conjecture, speculation, and
imagination. The military has shown no hard evidence that "the return of the Marcoses" would indeed interpose
a threat to national security. And apparently, the majority itself is not convinced ("has been viewed...").
That Mrs. Marcos has referred to President Corazon Aquino as an illegitimate President, does not, so I submit,
reinforce alleged fears of a massive destabilization awaiting the nation. The military has said over and over that
Marcos followers are not capable of successful destabilization effort. And only this morning (October 27,
1989), media reported the assurances given to foreign investors by no less than the President, of the political
and economic stability of the nation, as well as the Government's capability to quell forces that menace the
gains of EDSA.
I have no eulogies to say on the passing of Mr. Marcos. My personal impressions, however, are beside the point.
I reiterate that the President has no power to deny requests of Marcos relatives to bury Marcos in his homeland.
As for the former, let them get their just deserts here too. And let the matter rest.
Separate Opinions
CRUZ, J., dissenting:
Nothing important has happened to change my vote for granting the petition. The death of Marcos has not
plunged the nation into paroxysms of grief as the so-called "loyalists" had hoped. By and large, it has been met
with only passing interest if not outright indifference from the people. Clearly, the discredited dictator is in
death no El Cid. Marcos dead is only an unpleasant memory, not a bolt of lightning to whip the blood.
This only shows that if he was at all a threat to the national security when he was already moribund that feeble
threat has died with him. As the government stresses, he has been reduced to a non-person (which makes me
wonder why it is still afraid of him). His cadaver is not even regarded as a symbol of this or that or whatever
except by his fanatical followers. It is only a dead body waiting to be interred in this country.
This is a tempest in a teapot. We have more important things to do than debating over a corpse that deserves no
kinder fate than dissolution and oblivion. I say let it be brought home and buried deep and let us be done with it
forever.

PARAS, J., dissenting on the Motion for Reconsideration:

I find no reason to deviate from the dissenting opinion I have already expressed.
Firstly, the former President, although already dead, is still entitled to certain rights. It is not correct to say that a
dead man, since he is no longer a human being, has ceased to have rights. For instance, our Revised Penal Code
prohibits the commission of libel against a deceased individual. And even if we were to assume the nonexistence anymore of his human rights what about the human rights of his widow and the other members of his
family?
Secondly, up to now, the alleged threats to national security have remained unproved and consequently,
unpersuasive. Our Armed Forces can easily control any possible uprising or political and military
destabilization. In fact, the converse appears to be nearer the truth, that is, if we do not allow the remains to
come, more trouble may be expected.
Thirdly, reconciliation can proceed at a much faster pace if the petition for the return is granted. To refuse the
request can mean a hardening of resistance against the well-intentioned aim of the administration. Upon the
other hand, to grant the petition may well soften the hearts of the oppositionists; paving the way for a united
citizenry.
Finally, the entire world will surely applaud our government's act of mercy. As Shakespeare once wrote "the
quality of mercy is not strained." Surely, compassion is the better part of government. Remove mercy, and you
remove the best reason against civil strife, which if not abated can turn our country into a mainstream of fiery
dissent and in the end, as one great man has put it, the question will no longer be what is right, but what is left.
PADILLA, J., dissenting:
The death of former President Ferdinand E. Marcos, which supervened after decision in this case had been
rendered, was pre-empted and foreseen in my original dissenting opinion. There I said that the first cogent and
decisive proposition in this case is that "Mr. Marcos is a Filipino and, as such, entitled to return to, die and be
buried in this country." I have only to add a few statements to that dissenting opinion.
Respondents have succeeded in denying Mr. Marcos the first two (2) rights, i.e. to return to and die in this
country, The remaining right of this Filipino that cries out for vindication at this late hour is the right to be
buried in this country. Will the respondents be allowed to complete the circle of denying the constitutional and
human right of Mr. Marcos to travel which, as stated in my dissenting opinion, includes the right to return to,
die and be buried in this country? The answer should be in the negative if the Constitution is to still prevail; the
answer should be in the negative if we are to avoid the completely indefensible act of denying a Filipino the last
right to blend his mortal remains with a few square feet of earth in the treasured land of his birth.
Those who would deny this Filipino the only constitutional and human right that can be accorded him now say
that the constitutional and human right to be buried in this country would apply to any Filipino, except Mr.
Marcos, because he was a dictator and he plundered the country. This is the most irrelevant argument that can
be raised at this time. For, our democracy is built on the fundamental assumption (so we believe) that the
Constitution and all its guarantees apply to all Filipinos, whether dictator or pauper, learned or ignorant,
religious or agnostic as long as he is a Filipino.
It is said that to accord this Filipino the right to be buried in this country would pose a serious threat to national
security and public safety. What threat? As pointed out in my dissenting opinion, the second cogent and
decisive proposition in this case is that respondents have not presented any "hard evidence" (factual bases) or
convincing proof of such threat. "All we have are general conclusions of national security and public safety' in

avoidance of a specific, demandable and enforceable constitutional and basic human right to return." Recent
events have, to my mind, served to confirm the validity of such dissenting statement.
If a live Marcos returning to this country did not pose a serious threat to national security, the situation cannot
be any worse with a dead Marcos returning. For, a dead Marcos will return to be buried into mother earth,
where there are no protests, "demos", or even dissents, where the rule that reigns, in the language of Mr. Justice
Jackson in Barnette is the "unanimity of the graveyard."
It is said that, while a dead Marcos has been rendered impotent to threaten national security, his supporters
would pose that threat to national security. This argument is untenable as it is without merit. As I see it, Marcos'
supporters pose a greater threat to peace and order, with Marcos deprived of his right to burial in this country.
On the other hand, if the remains of Mr. Marcos are brought to the country and allowed the burial to which he is
constitutionally and humanly entitled, Marcos' supporters would be deprived of an otherwise potent argument
so conducive to mass protests and even violencethat their Idol has been cruelly denied the right to be buried
in his homeland.
It is also said that Mr. Marcos, in cadaver form, has no constitutional or human rights, to speak of. This
contention entirely begs the issue. In the first place, one cannot overlook that the right of Mr. Marcos, as a
Filipino, to be buried in this country, is asserted not for the first time after his death. It was vigorously asserted
long before his death. But, more importantly, the right of every Filipino to be buried in his country, is part of
a continuing right that starts from birth and ends only on the day he is finally laid to rest in his country.
This dissenting opinion does not pretend to deny the Philippine government the right to lay down conditions for
the burial of Mr. Marcos in this country, but I submit that these conditions must, as a fundamental postulate,
recognize the right of the man, as a Filipino, to be buried in this country NOW.
The majority resolution, in effect, bans Mr. Marcos' burial in this country now. Without in any way affecting
my respect and regard for my brethren and sisters in the majority, I am deeply concerned and greatly disturbed
that, with their decision banning a dead Marcos from burial in this country, they have passed an opportunity to
defuse a constitutional crisis that, in my humble assessment, threatens to ignite an already divided nation,
Regrettably, they have ignored the constitutional dimension of the problem rooted in the ageless and finest
tradition of our people for respect and deference to the dead. What predictably follows will be a continuing
strife, among our people, of unending hatred, recriminations and retaliations. God save this country!
My vote is for this Court to ORDER the respondents to allow the immediate return and burial in the Republic of
the Philippines of former President Ferdinand E. Marcos, subject to such conditions as the Philippine
government may impose in the interest of peace and order.
SARMIENTO, J., Dissenting:
The case has curious trappings of a deja vu, the shoe being on the other foot, yet, as I stated before, I can not
allow personal emotions to soften my "hardened impartiality" and deny, as a consequence, the rights of the exPresident's bereaved to bury his remains in his homeland, and for them to return from exile. As I had, then,
voted to grant the petition, so do I vote to grant reconsideration.
I have gone to lengths to locate in the four comers of the Constitution, by direct grant or by implication, the
President's supposed "residual" power to forbid citizens from entering the motherland reiterated in the
resolution of the majority. I have found none. I am not agreed, that:
3. Contrary to petitioners view, it cannot be denied that the President, upon whom executive
power is vested, has unstated residual powers which are implied from the grant of executive
power and which are necessary for her to comply with her duties under the Constitution. The

powers of the President are not limited to what are expressly enumerated in the article on the
Executive Department and in scattered provisions of the Constitution. This, notwithstanding the
avowed intent of the members of the Constitutional Commission of 1986 to limit the powers of
the President as a reaction to the abuses under the regime of Mr. Marcos, for the result was a
limitation of specific powers of the President, particularly those relating to the commander-inchief clause, but not a diminution of the general grant of executive power.
It is a nice word game, but it is nothing else. For, if the Constitution has imposed limitations on specific powers
of the President, it has, a fortiori, prescribed a diminution of executive power. The Charter says that the right
may only be restricted by: (1) a court order; or (2) by fiat of law. Had the fundamental law intended a
presidential imprimatur, it would have said so. It would have also completed the symmetry: judicial,
congressional, and executive restraints on the right. No amount of presumed residual executive power can
amend the Charter.
It is well to note that the Bill of Rights stands primarily, a limitation not only against legislative encroachments
on individual liberties, but more so, against presidential intrusions. And especially so, because the President is
the caretaker of the military establishment that has, several times over, been unkind to part of the population it
has also sworn to protect.
That "[t]he threats to the government, to which the return of the Marcoses has been viewed to provide a
catalytic effect, have not been shown to have ceased" (Res., 3) is the realm of conjecture, speculation, and
imagination. The military has shown no hard evidence that "the return of the Marcoses" would indeed interpose
a threat to national security. And apparently, the majority itself is not convinced ("has been viewed...").
That Mrs. Marcos has referred to President Corazon Aquino as an illegitimate President, does not, so I submit,
reinforce alleged fears of a massive destabilization awaiting the nation. The military has said over and over that
Marcos followers are not capable of successful destabilization effort. And only this morning (October 27,
1989), media reported the assurances given to foreign investors by no less than the President, of the political
and economic stability of the nation, as well as the Government's capability to quell forces that menace the
gains of EDSA.
I have no eulogies to say on the passing of Mr. Marcos. My personal impressions, however, are beside the point.
I reiterate that the President has no power to deny requests of Marcos relatives to bury Marcos in his homeland.
As for the former, let them get their just deserts here too. And let the matter rest.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 163980 August 3, 2006
HOLY SPIRIT HOMEOWNERS ASSOCIATION, INC. and NESTORIO F. APOLINARIO, in his
personal capacity and as President of Holy Spirit Homeowners Association, Inc., Petitioners,
vs.
SECRETARY MICHAEL DEFENSOR, in his capacity as Chairman of the Housing and Urban
Development Coordinating Council (HUDCC), ATTY. EDGARDO PAMINTUAN, in his capacity as
General Manager of the National Housing Authority (NHA), MR. PERCIVAL CHAVEZ, in his capacity
as Chairman of the Presidential Commission for the Urban Poor (PCUP), MAYOR FELICIANO
BELMONTE, in his capacity as Mayor of Quezon City, SECRETARY ELISEA GOZUN, in her capacity
as Secretary of the Department of Environment and Natural Resources (DENR) and SECRETARY
FLORENTE SORIQUEZ, in his capacity as Secretary of the Department of Public Works and Highways
(DPWH) as ex-officio members of the NATIONAL GOVERNMENT CENTER ADMINISTRATION
COMMITTEE, Respondents.
DECISION
TINGA, J.:
The instant petition for prohibition under Rule 65 of the 1997 Rules of Civil Procedure, with prayer for the
issuance of a temporary restraining order and/or writ of preliminary injunction, seeks to prevent respondents
from enforcing the implementing rules and regulations (IRR) of Republic Act No. 9207, otherwise known as the
"National Government Center (NGC) Housing and Land Utilization Act of 2003."
Petitioner Holy Spirit Homeowners Association, Inc. (Association) is a homeowners association from the West
Side of the NGC. It is represented by its president, Nestorio F. Apolinario, Jr., who is a co-petitioner in his own
personal capacity and on behalf of the association.
Named respondents are the ex-officio members of the National Government Center Administration Committee
(Committee). At the filing of the instant petition, the Committee was composed of Secretary Michael Defensor,
Chairman of the Housing and Urban Development Coordinating Council (HUDCC), Atty. Edgardo Pamintuan,
General Manager of the National Housing Authority (NHA), Mr. Percival Chavez, Chairman of the Presidential
Commission for Urban Poor (PCUP), Mayor Feliciano Belmonte of Quezon City, Secretary Elisea Gozun of the
Department of Environment and Natural Resources (DENR), and Secretary Florante Soriquez of the
Department of Public Works and Highways (DPWH).
Prior to the passage of R.A. No. 9207, a number of presidential issuances authorized the creation and
development of what is now known as the National Government Center (NGC).
On March 5, 1972, former President Ferdinand Marcos issued Proclamation No. 1826, reserving a parcel of
land in Constitution Hills, Quezon City, covering a little over 440 hectares as a national government site to be
known as the NGC. 1
On August 11, 1987, then President Corazon Aquino issued Proclamation No. 137, excluding 150 of the 440
hectares of the reserved site from the coverage of Proclamation No. 1826 and authorizing instead the disposition
of the excluded portion by direct sale to the bona fide residents therein. 2

In view of the rapid increase in population density in the portion excluded by Proclamation No. 137 from the
coverage of Proclamation No. 1826, former President Fidel Ramos issued Proclamation No. 248 on September
7, 1993, authorizing the vertical development of the excluded portion to maximize the number of families who
can effectively become beneficiaries of the governments socialized housing program. 3
On May 14, 2003, President Gloria Macapagal-Arroyo signed into law R.A. No. 9207. Among the salient
provisions of the law are the following:
Sec. 2. Declaration of Policy. It is hereby declared the policy of the State to secure the land tenure of the
urban poor. Toward this end, lands located in the NGC, Quezon City shall be utilized for housing,
socioeconomic, civic, educational, religious and other purposes.
Sec. 3. Disposition of Certain Portions of the National Government Center Site to Bona Fide Residents.
Proclamation No. 1826, Series of 1979, is hereby amended by excluding from the coverage thereof, 184
hectares on the west side and 238 hectares on the east side of Commonwealth Avenue, and declaring the same
open for disposition to bona fide residents therein: Provided, That the determination of the bona fide residents
on the west side shall be based on the census survey conducted in 1994 and the determination of the bona
fide residents on the east side shall be based on the census survey conducted in 1994 and occupancy verification
survey conducted in 2000: Provided, further, That all existing legal agreements, programs and plans signed,
drawn up or implemented and actions taken, consistent with the provisions of this Act are hereby adopted.
Sec. 4. Disposition of Certain Portions of the National Government Center Site for Local Government or
Community Facilities, Socioeconomic, Charitable, Educational and Religious Purposes. Certain portions of
land within the aforesaid area for local government or community facilities, socioeconomic, charitable,
educational and religious institutions are hereby reserved for disposition for such purposes: Provided, That only
those institutionsalready operating and with existing facilities or structures, or those occupying the land may
avail of the disposition program established under the provisions this Act; Provided, further, That in
ascertaining the specific areas that may be disposed of in favor of these institutions, the existing site allocation
shall be used as basis therefore:Provided, finally. That in determining the reasonable lot allocation of
such institutions without specific lot allocations, the land area that may be allocated to them shall be based on
the area actually used by said institutions at the time of effectivity of this Act. (Emphasis supplied.)
In accordance with Section 5 of R.A. No. 9207, 4 the Committee formulated the Implementing Rules and
Regulations (IRR) of R.A. No. 9207 on June 29, 2004. Petitioners subsequently filed the instant petition, raising
the following issues:
WHETHER OR NOT SECTION 3.1 (A.4), 3.1 (B.2), 3.2 (A.1) AND 3.2 (C.1) OF THE RULES AND
REGULATIONS OF REPUBLIC ACT NO. 9207, OTHERWISE KNOWN AS "NATIONAL
GOVERNMENT CENTER (NGC) HOUSING AND LAND UTILIZATION ACT OF 2003" SHOULD BE
DECLARED NULL AND VOID FOR BEING INCONSISTENT WITH THE LAW IT SEEKS TO
IMPLEMENT.
WHETHER OR NOT SECTION 3.1 (A.4), 3.1 (B.2), 3.2 (A.1) AND 3.2 (C.1) OF THE RULES AND
REGULATIONS OF REPUBLIC ACT NO. 9207, OTHERWISE KNOWN AS "NATIONAL
GOVERNMENT CENTER (NGC) HOUSING AND LAND UTILIZATION ACT OF 2003" SHOULD BE
DECLARED NULL AND VOID FOR BEING ARBITRARY, CAPRICIOUS AND WHIMSICAL. 5
First, the procedural matters.
The Office of the Solicitor General (OSG) argues that petitioner Association cannot question the
implementation of Section 3.1 (b.2) and Section 3.2 (c.1) since it does not claim any right over the NGC East
Side. Section 3.1 (b.2) provides for the maximum lot area that may be awarded to a resident-beneficiary of the

NGC East Side, while Section 3.2 (c.1) imposes a lot price escalation penalty to a qualified beneficiary who
fails to execute a contract to sell within the prescribed period. 6 Also, the OSG contends that since petitioner
association is not the duly recognized peoples organization in the NGC and since petitioners not qualify as
beneficiaries, they cannot question the manner of disposition of lots in the NGC. 7
"Legal standing" or locus standi has been defined as a personal and substantial interest in the case such that the
party has sustained or will sustain direct injury as a result of the governmental act that is being challenged.
The gist of the question of standing is whether a party alleges "such personal stake in the outcome of the
controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the
court depends for illumination of difficult constitutional questions." 8
Petitioner association has the legal standing to institute the instant petition, whether or not it is the duly
recognized association of homeowners in the NGC. There is no dispute that the individual members of
petitioner association are residents of the NGC. As such they are covered and stand to be either benefited or
injured by the enforcement of the IRR, particularly as regards the selection process of beneficiaries and lot
allocation to qualified beneficiaries. Thus, petitioner association may assail those provisions in the IRR which it
believes to be unfavorable to the rights of its members. Contrary to the OSGs allegation that the failure of
petitioner association and its members to qualify as beneficiaries effectively bars them from questioning the
provisions of the IRR, such circumstance precisely operates to confer on them the legal personality to assail the
IRR. Certainly, petitioner and its members have sustained direct injury arising from the enforcement of the IRR
in that they have been disqualified and eliminated from the selection process. While it is true that petitioners
claim rights over the NGC West Side only and thus cannot be affected by the implementation of Section 3.1
(b.2), which refers to the NGC East Side, the rest of the assailed provisions of the IRR, namely, Sections 3.1
(a.4), 3.2 (a.1) and 3.2 (c.1), govern the disposition of lots in the West Side itself or all the lots in the NGC.
We cannot, therefore, agree with the OSG on the issue of locus standi. The petition does not merit dismissal on
that ground.
There are, however, other procedural impediments to the granting of the instant petition. The OSG claims that
the instant petition for prohibition is an improper remedy because the writ of prohibition does not lie against the
exercise of a quasi-legislative function. 9 Since in issuing the questioned IRR of R.A. No. 9207, the Committee
was not exercising judicial, quasi-judicial or ministerial function, which is the scope of a petition for prohibition
under Section 2, Rule 65 of the 1997 Rules of Civil Procedure, the instant prohibition should be dismissed
outright, the OSG contends. For their part, respondent Mayor of Quezon City 10 and respondent NHA 11 contend
that petitioners violated the doctrine of hierarchy of courts in filing the instant petition with this Court and not
with the Court of Appeals, which has concurrent jurisdiction over a petition for prohibition.
The cited breaches are mortal. The petition deserves to be spurned as a consequence.
Administrative agencies possess quasi-legislative or rule-making powers and quasi-judicial or administrative
adjudicatory powers. Quasi-legislative or rule-making power is the power to make rules and regulations which
results in delegated legislation that is within the confines of the granting statute and the doctrine of nondelegability and separability of powers. 12
In questioning the validity or constitutionality of a rule or regulation issued by an administrative agency, a party
need not exhaust administrative remedies before going to court. This principle, however, applies only where the
act of the administrative agency concerned was performed pursuant to its quasi-judicial function, and not when
the assailed act pertained to its rule-making or quasi-legislative power. 13
The assailed IRR was issued pursuant to the quasi-legislative power of the Committee expressly authorized by
R.A. No. 9207. The petition rests mainly on the theory that the assailed IRR issued by the Committee is invalid
on the ground that it is not germane to the object and purpose of the statute it seeks to implement. Where what

is assailed is the validity or constitutionality of a rule or regulation issued by the administrative agency in the
performance of its quasi-legislative function, the regular courts have jurisdiction to pass upon the same. 14
Since the regular courts have jurisdiction to pass upon the validity of the assailed IRR issued by the Committee
in the exercise of its quasi-legislative power, the judicial course to assail its validity must follow the doctrine of
hierarchy of courts. Although the Supreme Court, Court of Appeals and the Regional Trial Courts have
concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and
injunction, such concurrence does not give the petitioner unrestricted freedom of choice of court forum. 15
True, this Court has the full discretionary power to take cognizance of the petition filed directly with it if
compelling reasons, or the nature and importance of the issues raised, so warrant. 16 A direct invocation of the
Courts original jurisdiction to issue these writs should be allowed only when there are special and important
reasons therefor, clearly and specifically set out in the petition. 17
In Heirs of Bertuldo Hinog v. Melicor, 18 the Court said that it will not entertain direct resort to it unless the
redress desired cannot be obtained in the appropriate courts, and exceptional and compelling circumstances,
such as cases of national interest and of serious implications, justify the availment of the extraordinary remedy
of writ of certiorari, calling for the exercise of its primary jurisdiction. 19 A perusal, however, of the petition for
prohibition shows no compelling, special or important reasons to warrant the Courts taking cognizance of the
petition in the first instance. Petitioner also failed to state any reason that precludes the lower courts from
passing upon the validity of the questioned IRR. Moreover, as provided in Section 5, Article VIII of the
Constitution, 20 the Courts power to evaluate the validity of an implementing rule or regulation is generally
appellate in nature. Thus, following the doctrine of hierarchy of courts, the instant petition should have been
initially filed with the Regional Trial Court.
A petition for prohibition is also not the proper remedy to assail an IRR issued in the exercise of a quasilegislative function. Prohibition is an extraordinary writ directed against any tribunal, corporation, board, officer
or person, whether exercising judicial, quasi-judicial or ministerial functions, ordering said entity or person to
desist from further proceedings when said proceedings are without or in excess of said entitys or persons
jurisdiction, or are accompanied with grave abuse of discretion, and there is no appeal or any other plain,
speedy and adequate remedy in the ordinary course of law. 21 Prohibition lies against judicial or ministerial
functions, but not against legislative or quasi-legislative functions. Generally, the purpose of a writ of
prohibition is to keep a lower court within the limits of its jurisdiction in order to maintain the administration of
justice in orderly channels. 22 Prohibition is the proper remedy to afford relief against usurpation of jurisdiction
or power by an inferior court, or when, in the exercise of jurisdiction in handling matters clearly within its
cognizance the inferior court transgresses the bounds prescribed to it by the law, or where there is no adequate
remedy available in the ordinary course of law by which such relief can be obtained. 23 Where the principal
relief sought is to invalidate an IRR, petitioners remedy is an ordinary action for its nullification, an action
which properly falls under the jurisdiction of the Regional Trial Court. In any case, petitioners allegation that
"respondents are performing or threatening to perform functions without or in excess of their jurisdiction" may
appropriately be enjoined by the trial court through a writ of injunction or a temporary restraining order.
In a number of petitions, 24 the Court adequately resolved them on other grounds without adjudicating on the
constitutionality issue when there were no compelling reasons to pass upon the same. In like manner, the instant
petition may be dismissed based on the foregoing procedural grounds. Yet, the Court will not shirk from its duty
to rule on the merits of this petition to facilitate the speedy resolution of this case. In proper cases, procedural
rules may be relaxed or suspended in the interest of substantial justice. And the power of the Court to except a
particular case from its rules whenever the purposes of justice require it cannot be questioned. 25
Now, we turn to the substantive aspects of the petition. The outcome, however, is just as dismal for petitioners.

Petitioners assail the following provisions of the IRR:

Section 3. Disposition of Certain portions of the NGC Site to the bonafide residents
3.1. Period for Qualification of Beneficiaries
xxxx
(a.4) Processing and evaluation of qualifications shall be based on the Code of Policies and subject to the
condition that a beneficiary is qualified to acquire only one (1) lot with a minimum of 36 sq. m. and maximum
of 54 sq. m. and subject further to the availability of lots.
xxxx
(b.2) Applications for qualification as beneficiary shall be processed and evaluated based on the Code of
Policies including the minimum and maximum lot allocation of 35 sq. m. and 60 sq. m.
xxxx
3.2. Execution of the Contract to Sell
(a) Westside
(a.1) All qualified beneficiaries shall execute Contract to Sell (CTS) within sixty (60) days from the effectivity
of the IRR in order to avail of the lot at P700.00 per sq. m.
xxxx
(c) for both eastside and westside
(c.1) Qualified beneficiaries who failed to execute CTS on the deadline set in item a.1 above in case of westside
and in case of eastside six (6) months after approval of the subdivision plan shall be subjected to lot price
escalation.
The rate shall be based on the formula to be set by the National Housing Authority factoring therein the
affordability criteria. The new rate shall be approved by the NGC-Administration Committee (NGC-AC).
Petitioners contend that the aforequoted provisions of the IRR are constitutionally infirm as they are not
germane to and/or are in conflict with the object and purpose of the law sought to be implemented.
First. According to petitioners, the limitation on the areas to be awarded to qualified beneficiaries under Sec.
3.1 (a.4) and (b.2) of the IRR is not in harmony with the provisions of R.A. No. 9207, which mandates that the
lot allocation to qualified beneficiaries shall be based on the area actually used or occupied by bona
fide residents without limitation to area. The argument is utterly baseless.
The beneficiaries of lot allocations in the NGC may be classified into two groups, namely, the urban poor or
thebona fide residents within the NGC site and certain government institutions including the local government.
Section 3, R.A. No. 9207 mandates the allocation of additional property within the NGC for disposition to
its bona fideresidents and the manner by which this area may be distributed to qualified beneficiaries. Section 4,
R.A. No. 9207, on the other hand, governs the lot disposition to government institutions. While it is true that
Section 4 of R.A. No. 9207 has a proviso mandating that the lot allocation shall be based on the land area

actually used or occupied at the time of the laws effectivity, this proviso applies only to institutional
beneficiaries consisting of the local government, socioeconomic, charitable, educational and religious
institutions which do not have specific lot allocations, and not to the bona fide residents of NGC. There is no
proviso which even hints that a bona fideresident of the NGC is likewise entitled to the lot area actually
occupied by him.
Petitioners interpretation is also not supported by the policy of R.A. No. 9207 and the prior proclamations
establishing the NGC. The governments policy to set aside public property aims to benefit not only the urban
poor but also the local government and various government institutions devoted to socioeconomic, charitable,
educational and
religious purposes. 26 Thus, although Proclamation No. 137 authorized the sale of lots to bona fide residents in
the NGC, only a third of the entire area of the NGC was declared open for disposition subject to the condition
that those portions being used or earmarked for public or quasi-public purposes would be excluded from the
housing program for NGC residents. The same policy of rational and optimal land use can be read in
Proclamation No. 248 issued by then President Ramos. Although the proclamation recognized the rapid increase
in the population density in the NGC, it did not allocate additional property within the NGC for urban poor
housing but instead authorized the vertical development of the same 150 hectares identified previously by
Proclamation No. 137 since the distribution of individual lots would not adequately provide for the housing
needs of all the bona fide residents in the NGC.
In addition, as provided in Section 4 of R.A. No. 9207, the institutional beneficiaries shall be allocated the areas
actually occupied by them; hence, the portions intended for the institutional beneficiaries is fixed and cannot be
allocated for other non-institutional beneficiaries. Thus, the areas not intended for institutional beneficiaries
would have to be equitably distributed among the bona fide residents of the NGC. In order to accommodate all
qualified residents, a limitation on the area to be awarded to each beneficiary must be fixed as a necessary
consequence.
Second. Petitioners note that while Sec. 3.2 (a.1) of the IRR fixes the selling rate of a lot at P700.00 per sq. m.,
R.A. No. 9207 does not provide for the price. They add Sec. 3.2 (c.1) penalizes a beneficiary who fails to
execute a contract to sell within six (6) months from the approval of the subdivision plan by imposing a price
escalation, while there is no such penalty imposed by R.A. No. 9207. Thus, they conclude that the assailed
provisions conflict with R.A. No. 9207 and should be nullified. The argument deserves scant consideration.
Where a rule or regulation has a provision not expressly stated or contained in the statute being implemented,
that provision does not necessarily contradict the statute. A legislative rule is in the nature of subordinate
legislation, designed to implement a primary legislation by providing the details thereof. 27 All that is required is
that the regulation should be germane to the objects and purposes of the law; that the regulation be not in
contradiction to but in conformity with the standards prescribed by the law. 28
In Section 5 of R.A. No. 9207, the Committee is granted the power to administer, formulate guidelines and
policies, and implement the disposition of the areas covered by the law. Implicit in this authority and the
statutes objective of urban poor housing is the power of the Committee to formulate the manner by which the
reserved property may be allocated to the beneficiaries. Under this broad power, the Committee is mandated to
fill in the details such as the qualifications of beneficiaries, the selling price of the lots, the terms and conditions
governing the sale and other key particulars necessary to implement the objective of the law. These details are
purposely omitted from the statute and their determination is left to the discretion of the Committee because the
latter possesses special knowledge and technical expertise over these matters.
The Committees authority to fix the selling price of the lots may be likened to the rate-fixing power of
administrative agencies. In case of a delegation of rate-fixing power, the only standard which the legislature is
required to prescribe for the guidance of the administrative authority is that the rate be reasonable and just.

However, it has been held that even in the absence of an express requirement as to reasonableness, this standard
may be implied. 29 In this regard, petitioners do not even claim that the selling price of the lots is unreasonable.
The provision on the price escalation clause as a penalty imposed to a beneficiary who fails to execute a
contract to sell within the prescribed period is also within the Committees authority to formulate guidelines and
policies to implement R.A. No. 9207. The Committee has the power to lay down the terms and conditions
governing the disposition of said lots, provided that these are reasonable and just. There is nothing objectionable
about prescribing a period within which the parties must execute the contract to sell. This condition can
ordinarily be found in a contract to sell and is not contrary to law, morals, good customs, public order, or public
policy.
Third. Petitioners also suggest that the adoption of the assailed IRR suffers from a procedural flaw. According
to them the IRR was adopted and concurred in by several representatives of peoples organizations contrary to
the express mandate of R.A. No. 9207 that only two representatives from duly recognized peoples
organizations must compose the NGCAC which promulgated the assailed IRR. It is worth noting that petitioner
association is not a duly recognized peoples organization.
In subordinate legislation, as long as the passage of the rule or regulation had the benefit of a hearing, the
procedural due process requirement is deemed complied with. That there is observance of more than the
minimum requirements of due process in the adoption of the questioned IRR is not a ground to invalidate the
same.
In sum, the petition lacks merit and suffers from procedural deficiencies.
WHEREFORE, the instant petition for prohibition is DISMISSED. Costs against petitioners.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 98472 August 19, 1993

PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC. (PASEI), PHILIPPINE
ENTERTAINMENT EXPORTERS AND PROMOTERS ASSOCIATION (PEEPA), and
ASSOCIATION OF FILIPINO OVERSEAS WORKERS, INC. (AFOWI), petitioners,
vs.
HON. RUBEN D. TORRES, SECRETARY OF LABOR AND EMPLOYMENT, respondent.
JOBLINK INTERNATIONAL, INC. (herein represented by FEBI L. ENRIQUEZ, Vice President for
Operations) and PROSPECS INTERNATIONAL CONSULTANCY (herein represented by QUINTIN
C. FENIZA, Proprietor-General Manager), intervenors, RP-JAPAN ENTERTAINMENT
PROMOTERS, ASSOCIATION, INC. (REPA), intervenor, AMADER INTERNATIONAL, INC., IDG
TRADING & GENERAL SERVICES, PHILCANGO INTERNATIONAL RECRUITMENT
SERVICES, PAN ASIA MANPOWER PLACEMENT, LYKA INTERNATIONAL MANPOWER
SERVICES, INTERNATIONAL MANPOWER SERVICES, MAINLINE RECRUITMENT
INTERNATIONAL, INC., WORLD MATRIX UNLIMITED SERVICES CONSULTANCY &
TRADING CO., NUBA INTERNATIONAL MANPOWER SERVICES CORPORATION, EL BARY
MANPOWER SERVICES, SOCIAL SERVICES CONT., INT'L CO. LTD., CDD ENTERPRISES and
VELREY RECRUITMENT COMPANY,intervenors.
Gutierrez & Alo Law Office for petitioners.
Domingo F. Gonzales for Intervenor RP-Japan Entertainment Promoters Association.
Gil-Fernando C. Cruz for Intervenors JOBLINK International, Inc. et al.
Ceferino P. Padua for Intervenors Amader International, Inc. et al.

BELLOSILLO, J.:
May an Executive Order (EO) 1 repeal a Letter of Instruction (LOI)? 2
Ordinarily, since both LOI and EO are presidential issuances, one may repeal or otherwise alter, modify or
amend the other, depending on which comes later. The case before us appears compounded by the circumstance
that the LOI in question was issued by former President Ferdinand E. Marcos when he was clothed with
legislative power, while the EO revoking the LOI was issued by then President Corazon C. Aquino at a time
when she had already lost her law-making power after Congress convened on 27 July 1987. 3 Although the EO
issued by President Aquino is undoubtedly not a law but a mere administrative issuance, the parties here debate
whether the LOI issued by President Marcos was a law or simply an administrative rule in view of his dual
position then as chief executive and as legislative authority. Petitioners contend that the LOI is a law, hence, the

EO cannot countermand it, while public respondent claims that the LOI is only an administrative issuance
which may be superseded by an EO.
In determining whether a presidential issuance under the 1973 Constitution may be considered a law, we held
inGarcia-Padilla v. Enrile 4 that "[T]o form part of the law of the land, the decree, order or LOI must be issued
by the President in the exercise of his extraordinary power of legislation as contemplated in Section 6 of the
1976 Amendments to the Constitution, whenever in his judgment there exists a grave emergency or a threat or
imminence thereof, or whenever the interim Batasan Pambansa or the regular National Assembly fails or is
unable to act adequately on any matter for any reason that in his judgment requires immediate action. . . .
Verily, not all LOI issued by the President should be dignified into forming part of the law of the land."
Article 25 of the Labor Code of the Philippines (P.D. 442, as amended) 5 encourages private sector participation
in recruitment and placement of workers under guidelines, rules and regulations to be issued by the Secretary of
Labor. On 20 January 1982, President Marcos issued LOI 1190 withholding the grant of new licenses to operate
agencies for overseas employment effective 1 January 1982 except as he may otherwise direct. 6 On 19 March
1991, President Aquino issued EO 450 lifting the ban on new applications for licenses to operate recruitment
agencies subject to guidelines and regulations the Secretary of Labor may promulgate. 7 On 8 April 1991,
respondent Secretary of Labor and Employment promulgated Department (DO) No. 9, Series of 1991, entitled
"Guidelines Implementing Executive Order No. 450."
In this Petition for Prohibition with Preliminary Injunction/Restraining Order filed 14 May 1991 petitioners
Philippine Association of Service Exporters, Inc. (PASEI), Philippine Entertainment Exporters and Promoters
Association (PEEPA), and Association of Filipino Overseas Workers, Inc. (AFOWI) pray that EO 450 be
declared invalid for being contrary to LOI 1190.
On 16 May 1991, we issued a temporary restraining order directing respondent Secretary of Labor and
Employment to cease and desist from enforcing EO 450 and DO 9 until further orders. 8 Thereafter, three
motions for intervention were filed, 9 which the Court eventually allowed. 10 Intervenors Joblink International,
Inc. (JOBLINK), Prospecs International Consultancy, Amader International, Inc. (AMADER), IDG Trading &
General Services, Philcango International Recruitment Services, Pan Asia Manpower Placement, International,
Manpower Services, Lyka International, Inc., World Matrix Unlimited Services Consultancy & Trading Co.,
Nuba International Manpower Services Corporation, El Barry Manpower Services, Social Services Cont. Int'l
Co., Ltd., CDD Enterprises and Velrey Recruitment Company, all applicants for new licenses, support the
position of respondent that LOI 1190 was not a law.
On the other hand, intervenor RP-Japan Entertainment Promoters Association, Inc. (REPA), a non-stock, nonprofit domestic corporation composed of private employment agencies authorized to recruit and deploy contract
workers abroad, prays for the modification of the restraining order we issued on 16 May 1991. We addressed
this incident on 4 July 1991 when we explained that our temporary restraining order did not comprehend
renewal of existing licenses since EO 450 covered only new applications. 11 The other pending issue relating to
the lifting and modification of our Resolution of 16 May 1991, will accordingly be resolved in this decision.
First, on the challenge of intervenors AMADER, et al., that petitioners lack locus standi, we need only reiterate
that the "proper-party" requirement is satisfied if it is alleged that petitioners and intervenors have sustained or
are in danger of sustaining immediate injury resulting from the acts or measures complained of. 12 Petitioners
PASEI and PEEPA allege that their member agencies, which enjoy protection against competition by new
licensees pursuant to LOI 1190, will suffer irreparable injury with the repeal of LOI 1190 by EO 450,
considering further that there is no additional demand for Filipino workers abroad. Hence, any gain made by the
new agencies on the supposed exclusive preserve of existing agencies necessarily results in the latter's loss.
But, as regards petitioner Association of Filipino Overseas Workers, Inc. (AFOWI), we are not persuaded that
the proliferation of recruitment agencies will necessarily result in exposure of workers to exploitation by

unscrupulous recruiters, for the stiffer competition may even compel these agencies to seek better terms and
conditions for overseas workers. Hence, the petition being founded on mere speculation insofar as it affects
AFOWI, the same should be dismissed for want of a valid cause of action.
On the issue raised by intervenors that the petition can be decided without touching on the validity of EO 450,
we cannot find any other way but to meet the question squarely since petitioners' relief depends on its validity.
The central thesis of the petition is that LOI 1190 was issued pursuant to the law-making power of the President
under Sec. 6 of the 1976 Amendments to the 1973 Constitution in response to "a grave emergency which cried
for immediate and decisive action," hence, should be considered part of the law of the land. Petitioners argue
that because of its repealing or modifying effect on Art. 25 of the Labor Code, LOI 1190 could be valid only if
treated as a law, and that a contrary interpretation that would render LOI 1190 invalid could not have been
intended by the then incumbent President.
As we view it, LOI 1190 13 simply imposes a presidential review of the authority of the Minister of Labor and
Employment to grant licenses, hence, directed to him alone. Since this is undoubtedly an administrative action,
LOI 1190 should properly be treated as an administrative issuance. Unlike Presidential Decrees which by usage
have gained acceptance as laws promulgated by the President, Letters of Instruction are presumed to be mere
administrative issuances except when the conditions set out in Garcia-Padilla v. Enrile exist. Consequently, to
be considered part of the law of the land, petitioners must establish that LOI, 1190 was issued in response to "a
grave emergency or a threat or imminence thereof, or whenever the interim Batasan Pambansa or the regular
National Assembly fails or is unable to act adequately on any matter." The conspicuous absence of any of these
conditions fortifies the opinion that LOI 1190 cannot be any more than a mere administrative issuance.
In arguing that LOI 1190 was issued to cope with "a grave emergency," petitioners point to the 3rd "Whereas"
clause which speaks of the concern of the state against cut-throat competition seriously affecting the integrity
and viability of the overseas recruitment industry, and the difficulty in the regulation and supervision of
agencies and the protection of the welfare of the workers. The petitioner's appraisal that the 3rd "Whereas"
clause manifests a grave emergency situation is as good as anybody else's contrary view. Moreover, even if we
treat as emergency the "situation which has seriously affected the integrity and viability of the overseas
employment industry," there is no indication that in the judgment of the President it is grave.
Petitioners argue that since the repeal of Art. 25 of the Labor Code could not be done through an administrative
issuance, LOI 1190 must of necessity be a law. This reasoning is flawed.
There is nothing in the LOI which repeals or runs counter to Art. 25 of the Labor Code, as amended. Instead,
contrary to the perception of petitioners, LOI 1190 does not actually ban the grant of licenses nor bar the entry
of new licensees since anybody could still apply for license with the Minister of Labor and Employment,
although the grant thereof is subject to the prior authority of the President. In fact, the LOI did not modify the
rule-making power of the Minister of Labor and Employment under the Labor Code; it only added another tier
of review.
Neither can petitioners consider this additional review by the President as an amendment of Art. 25, for this is
within the scope of the exercise of his constitutionally sanctioned control over the executive departments of
government. 14 Implicit in that power of control is the President's "authority to go over, confirm, modify or
reverse the action taken by his department
secretaries." 15 Moreover, if we discern the intent of LOI 1190 from the manner it was enforced, the unrebutted
allegation of respondent that 319 private employment agencies secured administrative presidential approval
from 1982 to 1989 16 shows that then President Marcos merely intended to regulate, and not ban altogether,
new applications for licenses. For this reason, Marcos could not have contemplated repealing Art. 25 of the
Labor Code.

Petitioners advance a rather outrageous interpretation of LOI 1190 when they claim that "[t]he then President
was in effect saying that 'Art. 25 of the Labor Code is hereby repealed as regards overseas workers until I
otherwise direct.'" 17 By their nature, and their purpose to maintain stability in the polity, laws have a certain
degree of permanence such that they are not intended to be repealed one hour after their enactment, then reenacted the following hour, and so on. If he law has to be applied on a case to case basis, as in the case Art. 25
of the Labor Code, it does not have to undergo the tedious process of repeal and re-enactment every time its
application is warranted.
Petitioners would impress upon us the interpretation that LOI 1190 suspended the effectivity of Art. 25, which
could not be done because the chief executive is constitutionally bound to "ensure that the laws be faithfully
executed." 18 As we earlier stated, the LOI did not suspend the enforcement of Art. 25 of the Labor Code; it
merely added another level of administrative review.
The discussion on whether the word "I" in the phrase "except as I may otherwise direct" refers to the President
as chief executive or as a legislator is meaningless, for the correct interpretation would ultimately depend on
whether the LOI is a law or an administrative issuance.
Petitioners also contend that EO 450 cannot repeal LOI 1190 for Congress has not delegated that power to the
President. 19 We do not agree. There is no need for legislative delegation of power to the President to revoke the
LOI by way of an EO in view of our finding that LOI 1190 is a mere administrative directive, 20 hence, may be
repealed, altered or modified by EO 450, and DO 9 must consequently be upheld.
Of the three(3) groups of intervenors, only AMADER et al., pray for attorney's fees claiming that they were
compelled to hire counsel to enforce and protect their rights. However, in view of the complexity of the legal
issue involved, the Court resolves not to grant attorney's fees.
WHEREFORE, the instant petition is DISMISSED. The Temporary Restraining Order we issued on 16 May
1991 is accordingly LIFTED and SET ASIDE. Executive Order No. 450 and Department Order No. 9 of the
Department of Labor and Employment are SUSTAINED. Accordingly, Letter of Instruction No. 1190 is
declared REPEALED and SUPERSEDED by Executive Order No. 450.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 118712 October 6, 1995

LAND BANK OF THE PHILIPPINES, petitioner,
vs.
COURT OF APPEALS, PEDRO L. YAP, HEIRS OF EMILIANO F. SANTIAGO, AGRICULTURAL
MANAGEMENT & DEVELOPMENT CORP., respondents.
G.R. No. 118745 October 6, 1995
DEPARTMENT OF AGRARIAN REFORM, represented by the Secretary of Agrarian
Reform, petitioner,
vs.
COURT OF APPEALS, PEDRO L. YAP, HEIRS OF EMILIANO F. SANTIAGO, AGRICULTURAL
MANAGEMENT & DEVELOPMENT CORP., ET AL., respondents.

FRANCISCO, R., J.:

It has been declared that the duty of the court to protect the weak and the underprivileged should not be carried
out to such an extent as deny justice to the landowner whenever truth and justice happen to be on his side. 1 As
eloquently stated by Justice Isagani Cruz:
. . . social justice or any justice for that matter is for the deserving, whether he be a
millionaire in his mansion or a pauper in his hovel. It is true that, in case of reasonable doubt, we
are called upon to tilt the balance in favor of the poor, to whom the Constitution fittingly extends
its sympathy and compassion. But never is it justified to prefer the poor simply because they are
poor, or to reject the rich simply because they are rich, for justice must always be served, for
poor and rich alike, according to the mandate of the law. 2
In this agrarian dispute, it is once more imperative that the aforestated principles be applied in its resolution.
Separate petitions for review were filed by petitioners Department of Agrarian Reform (DAR) (G.R. No.
118745) and Land Bank of the Philippines (G.R. No. 118712) following the adverse ruling by the Court of
Appeals in CA-G.R. SP No. 33465. However, upon motion filed by private respondents, the petitions were
ordered consolidated. 3
Petitioners assail the decision of the Court of Appeals promulgated on October 20, 1994, which granted private
respondents' Petition for Certiorari and Mandamus and ruled as follows:
WHEREFORE, premises considered, the Petition for Certiorari and Mandamus is hereby
GRANTED:

a) DAR Administrative Order No. 9, Series of 1990 is

declared null and void insofar as it provides for the opening of trust accounts in
lieu of deposits in cash or bonds;
b) Respondent Landbank is ordered to immediately deposit not merely
"earmark", "reserve" or "deposit in trust" with an accessible bank designated
by respondent DAR in the names of the following petitioners the following
amounts in cash and in government financial instruments within the
parameters of Sec. 18 (1) of RA 6657:
P 1,455,207.31 Pedro L. Yap
P 135,482.12 Heirs of Emiliano Santiago
P 15,914,127.77 AMADCOR;
c) The DAR-designated bank is ordered to allow the petitioners to withdraw the
above-deposited amounts without prejudice to the final determination of just
compensation by the proper authorities; and
d) Respondent DAR is ordered to 1) immediately conduct summary administrative
proceedings to determine the just compensation for the lands of the petitioners
giving the petitioners 15 days from notice within which to submit evidence and to
2) decide the cases within 30 days after they are submitted for decision. 4
Likewise, petitioners seek the reversal of the Resolution dated January 18, 1995, 5 denying their motion
for reconsideration.
Private respondents are landowners whose landholdings were acquired by the DAR and subjected to transfer
schemes to qualified beneficiaries under the Comprehensive Agrarian Reform Law (CARL, Republic Act No.
6657).
Aggrieved by the alleged lapses of the DAR and the Landbank with respect to the valuation and
payment of compensation for their land pursuant to the provisions of RA 6657, private respondents filed
with this Court a Petition for Certiorari and Mandamus with prayer for preliminary mandatory
injunction. Private respondents questioned the validity of DAR Administrative Order No. 6, Series of
1992 6 and DAR Administrative Order No. 9, Series of 1990, 7 and sought to compel the DAR to
expedite the pending summary administrative proceedings to finally determine the just compensation of
their properties, and the Landbank to deposit in cash and bonds the amounts respectively "earmarked",
"reserved" and "deposited in trust accounts" for private respondents, and to allow them to withdraw the
same.
Through a Resolution of the Second Division dated February 9, 1994, this Court referred the petition to
respondent Court of Appeals for proper determination and disposition.
As found by respondent court , the following are undisputed:
Petitioner Pedro Yap alleges that "(o)n 4 September 1992 the transfer certificates of title (TCTs)
of petitioner Yap were totally cancelled by the Registrar of Deeds of Leyte and were transferred
in the names of farmer beneficiaries collectively, based on the request of the DAR together with
a certification of the Landbank that the sum of P735,337.77 and P719,869.54 have been
earmarked for Landowner Pedro L. Yap for the parcels of lands covered by TCT Nos. 6282 and

6283, respectively, and issued in lieu thereof TC-563 and TC-562, respectively, in the names of
listed beneficiaries (ANNEXES "C" & "D") without notice to petitioner Yap and without
complying with the requirement of Section 16 (e) of RA 6657 to deposit the compensation in
cash and Landbank bonds in an accessible bank. (Rollo, p. 6).
The above allegations are not disputed by any of the respondents.
Petitioner Heirs of Emiliano Santiago allege that the heirs of Emiliano F. Santiago are the
owners of a parcel of land located at Laur, NUEVA ECIJA with an area of 18.5615 hectares
covered by TCT No. NT-60359 of the registry of Deeds of Nueva Ecija, registered in the name
of the late Emiliano F. Santiago; that in November and December 1990, without notice to the
petitioners, the Landbank required and the beneficiaries executed Actual tillers Deed of
Undertaking (ANNEX "B") to pay rentals to the LandBank for the use of their farmlots
equivalent to at least 25% of the net harvest; that on 24 October 1991 the DAR Regional
Director issued an order directing the Landbank to pay the landowner directly or through the
establishment of a trust fund in the amount of P135,482.12, that on 24 February 1992, the
Landbank reserved in trust P135,482.12 in the name of Emiliano F. Santiago. (ANNEX
"E"; Rollo,
p. 7); that the beneficiaries stopped paying rentals to the landowners after they signed the Actual
Tiller's Deed of Undertaking committing themselves to pay rentals to the LandBank (Rollo, p.
133).
The above allegations are not disputed by the respondents except that respondent Landbank
claims 1) that it was respondent DAR, not Landbank which required the execution of Actual
Tillers Deed of Undertaking (ATDU, for brevity); and 2) that respondent Landbank, although
armed with the ATDU, did not collect any amount as rental from the substituting beneficiaries
(Rollo, p. 99).
Petitioner Agricultural Management and Development Corporation (AMADCOR, for brevity)
alleges with respect to its properties located in San Francisco, Quezon that the properties
of AMADCOR in San Francisco, Quezon consist of a parcel of land covered by TCT No. 34314
with an area of 209.9215 hectares and another parcel covered by TCT No. 10832 with an area of
163.6189 hectares; that a summary administrative proceeding to determine compensation of the
property covered by TCT No. 34314 was conducted by the DARAB in Quezon City without
notice to the landowner; that a decision was rendered on 24 November 1992 (ANNEX "F")
fixing the compensation for the parcel of land covered by TCT No. 34314 with an area of
209.9215 hectares at P2,768,326.34 and ordering the Landbank to pay or establish a trust account
for said amount in the name of AMADCOR; and that the trust account in the amount of
P2,768,326.34 fixed in the decision was established by adding P1,986,489.73 to the first trust
account established on 19 December 1991 (ANNEX "G"). With respect to petitioner
AMADCOR's property in Tabaco, Albay, it is alleged that the property of AMADCOR in
Tabaco, Albay is covered by TCT No. T-2466 of the Register of Deeds of Albay with an area of
1,629.4578 hectares'; that emancipation patents were issued covering an area of 701.8999
hectares which were registered on 15 February 1988 but no action was taken thereafter by the
DAR to fix the compensation for said land; that on 21 April 1993, a trust account in the name of
AMADCOR was established in the amount of P12,247,217.83', three notices of acquisition
having been previously rejected by AMADCOR. (Rollo, pp. 8-9)
The above allegations are not disputed by the respondents except that respondent Landbank
claims that petitioner failed to participate in the DARAB proceedings (land valuation case)
despite due notice to it (Rollo, p. 100). 8

Private respondents argued that Administrative Order No. 9, Series of 1990 was issued without jurisdiction and
with grave abuse of discretion because it permits the opening of trust accounts by the Landbank, in lieu of
depositing in cash or bonds in an accessible bank designated by the DAR, the compensation for the land before
it is taken and the titles are cancelled as provided under Section 16(e) of RA 6657. 9 Private respondents also
assail the fact that the DAR and the Landbank merely "earmarked", "deposited in trust" or "reserved" the
compensation in their names as landowners despite the clear mandate that before taking possession of the
property, the compensation must be deposited in cash or in bonds. 10
Petitioner DAR, however, maintained that Administrative Order No. 9 is a valid exercise of its rule-making
power pursuant to Section 49 of RA 6657. 11 Moreover, the DAR maintained that the issuance of the
"Certificate of Deposit" by the Landbank was a substantial compliance with Section 16(e) of RA 6657 and the
ruling in the case of Association of Small Landowners in the Philippines, Inc., et al. vs. Hon. Secretary of
Agrarian Reform, G.R. No. 78742, July 14, 1989 (175 SCRA 343). 12
For its part, petitioner Landbank declared that the issuance of the Certificates of Deposits was in consonance
with Circular Nos. 29, 29-A and 54 of the Land Registration Authority where the words "reserved/deposited"
were also used. 13
On October 20, 1994, the respondent court rendered the assailed decision in favor of private
respondents. 14Petitioners filed a motion for reconsideration but respondent court denied the same. 15
Hence, the instant petitions.
On March 20, 1995, private respondents filed a motion to dismiss the petition in G.R. No. 118745 alleging that
the appeal has no merit and is merely intended to delay the finality of the appealed decision. 16 The Court,
however, denied the motion and instead required the respondents to file their comments. 17
Petitioners submit that respondent court erred in (1) declaring as null and void DAR Administrative Order No.
9, Series of 1990, insofar as it provides for the opening of trust accounts in lieu of deposit in cash or in bonds,
and (2) in holding that private respondents are entitled as a matter of right to the immediate and provisional
release of the amounts deposited in trust pending the final resolution of the cases it has filed for just
compensation.
Anent the first assignment of error, petitioners maintain that the word "deposit" as used in Section 16(e) of RA
6657 referred merely to the act of depositing and in no way excluded the opening of a trust account as a form of
deposit. Thus, in opting for the opening of a trust account as the acceptable form of deposit through
Administrative Circular No. 9, petitioner DAR did not commit any grave abuse of discretion since it merely
exercised its power to promulgate rules and regulations in implementing the declared policies of RA 6657.
The contention is untenable. Section 16(e) of RA 6657 provides as follows:
Sec. 16. Procedure for Acquisition of Private Lands
xxx xxx xxx
(e) Upon receipt by the landowner of the corresponding payment or, in case of rejection or no
response from the landowner, upon the deposit with an accessible bank designated by the DAR of
the compensation in cash or in LBP bonds in accordance with this Act, the DAR shall take
immediate possession of the land and shall request the proper Register of Deeds to issue a
Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. . . . (emphasis
supplied)

It is very explicit therefrom that the deposit must be made only in "cash" or in "LBP bonds". Nowhere does it
appear nor can it be inferred that the deposit can be made in any other form. If it were the intention to include a
"trust account" among the valid modes of deposit, that should have been made express, or at least, qualifying
words ought to have appeared from which it can be fairly deduced that a "trust account" is allowed. In sum,
there is no ambiguity in Section 16(e) of RA 6657 to warrant an expanded construction of the term "deposit".
The conclusive effect of administrative construction is not absolute. Action of an administrative agency may be
disturbed or set aside by the judicial department if there is an error of law, a grave abuse of power or lack of
jurisdiction or grave abuse of discretion clearly conflicting with either the letter or the spirit of a legislative
enactment. 18 In this regard, it must be stressed that the function of promulgating rules and regulations may be
legitimately exercised only for the purpose of carrying the provisions of the law into effect. The power of
administrative agencies is thus confined to implementing the law or putting it into effect. Corollary to this is
that administrative regulations cannot extend
the law and amend a legislative enactment, 19 for settled is the rule that administrative regulations must be in
harmony with the provisions of the law. And in case there is a discrepancy between the basic law and an
implementing rule or regulation, it is the former that prevails. 20
In the present suit, the DAR clearly overstepped the limits of its power to enact rules and regulations when it
issued Administrative Circular No. 9. There is no basis in allowing the opening of a trust account in behalf of
the landowner as compensation for his property because, as heretofore discussed, Section 16(e) of RA 6657 is
very specific that the deposit must be made only in "cash" or in "LBP bonds". In the same vein, petitioners
cannot invoke LRA Circular Nos. 29, 29-A and 54 because these implementing regulations cannot outweigh the
clear provision of the law. Respondent court therefore did not commit any error in striking down Administrative
Circular No. 9 for being null and void.
Proceeding to the crucial issue of whether or not private respondents are entitled to withdraw the amounts
deposited in trust in their behalf pending the final resolution of the cases involving the final valuation of their
properties, petitioners assert the negative.
The contention is premised on the alleged distinction between the deposit of compensation under Section 16(e)
of RA 6657 and payment of final compensation as provided under Section 18 21 of the same law. According to
petitioners, the right of the landowner to withdraw the amount deposited in his behalf pertains only to the final
valuation as agreed upon by the landowner, the DAR and the LBP or that adjudged by the court. It has no
reference to amount deposited in the trust account pursuant to Section 16(e) in case of rejection by the
landowner because the latter amount is only provisional and intended merely to secure possession of the
property pending final valuation. To further bolster the contention petitioners cite the following
pronouncements in the case of "Association of Small Landowners in the Phil. Inc. vs. Secretary of Agrarian
Reform". 22
The last major challenge to CARP is that the landowner is divested of his property even before
actual payment to him in full of just compensation, in contravention of a well-accepted principle
of eminent domain.
xxx xxx xxx
The CARP Law, for its part conditions the transfer of possession and ownership of the land to
the government on receipt by the landowner of the corresponding payment or the deposit by the
DAR of the compensation in cash or LBP bonds with an accessible bank. Until then, title also
remains with the landowner. No outright change of ownership is contemplated either.
xxx xxx xxx

Hence the argument that the assailed measures violate due process by arbitrarily transferring title
before the land is fully paid for must also be rejected.
Notably, however, the aforecited case was used by respondent court in discarding petitioners' assertion as it
found that:
. . . despite the "revolutionary" character of the expropriation envisioned under RA 6657 which
led the Supreme Court, in the case of Association of Small Landowners in the Phil. Inc. vs.
Secretary of Agrarian Reform (175 SCRA 343), to conclude that "payments of the just
compensation is not always required to be made fully in money" even as the Supreme Court
admits in the same case "that the traditional medium for the payment of just compensation is
money and no other" the Supreme Court in said case did not abandon the "recognized rule . .
. that title to the property expropriated shall pass from the owner to the expropriator only upon
full payment of the just compensation." 23(Emphasis supplied)
We agree with the observations of respondent court. The ruling in the "Association" case merely recognized the
extraordinary nature of the expropriation to be undertaken under RA 6657 thereby allowing a deviation from the
traditional mode of payment of compensation and recognized payment other than in cash. It did not, however,
dispense with the settled rule that there must be full payment of just compensation before the title to the
expropriated property is transferred.
The attempt to make a distinction between the deposit of compensation under Section 16(e) of RA 6657 and
determination of just compensation under Section 18 is unacceptable. To withhold the right of the landowners
to appropriate the amounts already deposited in their behalf as compensation for their properties simply because
they rejected the DAR's valuation, and notwithstanding that they have already been deprived of the possession
and use of such properties, is an oppressive exercise of eminent domain. The irresistible expropriation of private
respondents' properties was painful enough for them. But petitioner DAR rubbed it in all the more by
withholding that which rightfully belongs to private respondents in exchange for the taking, under an authority
(the "Association" case) that is, however, misplaced. This is misery twice bestowed on private respondents,
which the Court must rectify.
Hence, we find it unnecessary to distinguish between provisional compensation under Section 16(e) and final
compensation under Section 18 for purposes of exercising the landowners' right to appropriate the same. The
immediate effect in both situations is the same, the landowner is deprived of the use and possession of his
property for which he should be fairly and immediately compensated. Fittingly, we reiterate the cardinal rule
that:
. . . within the context of the State's inherent power of eminent domain, just compensation means
not only the correct determination of the amount to be paid to the owner of the land but also the
payment of the land within a reasonable time from its taking. Without prompt
payment, compensation cannot be considered "just" for the property owner is made to suffer the
consequence of being immediately deprived of his land while being made to wait for a decade or
more before actually receiving the amount necessary to cope with his loss. 24 (Emphasis
supplied)
The promulgation of the "Association" decision endeavored to remove all legal obstacles in the implementation
of the Comprehensive Agrarian Reform Program and clear the way for the true freedom of the farmer. 25 But
despite this, cases involving its implementation continue to multiply and clog the courts' dockets. Nevertheless,
we are still optimistic that the goal of totally emancipating the farmers from their bondage will be attained in
due time. It must be stressed, however, that in the pursuit of this objective, vigilance over the rights of the
landowners is equally important because social justice cannot be invoked to trample on the rights of property
owners, who under our Constitution and laws are also entitled to protection. 26

WHEREFORE, the foregoing premises considered, the petition is hereby DENIED for lack of merit and the
appealed decision is AFFIRMED in toto.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION

G.R. No. 108358 January 20, 1995

COMMISSIONER OF INTERNAL REVENUE, petitioner,
vs.
THE HON. COURT OF APPEALS, R.O.H. AUTO PRODUCTS PHILIPPINES, INC. and THE HON.
COURT OF TAX APPEALS, respondents.

VITUG, J.:
On 22 August 1986, during the period when the President of the Republic still wielded legislative powers,
Executive Order No. 41 was promulgated declaring a one-time tax amnesty on unpaid income taxes, later
amended to include estate and donor's taxes and taxes on business, for the taxable years 1981 to 1985.
Availing itself of the amnesty, respondent R.O.H. Auto Products Philippines, Inc., filed, in October 1986 and
November 1986, its Tax Amnesty Return No. 34-F-00146-41 and Supplemental Tax Amnesty Return No. 34-F00146-64-B, respectively, and paid the corresponding amnesty taxes due.
Prior to this availment, petitioner Commissioner of Internal Revenue, in a communication received by private
respondent on 13 August 1986, assessed the latter deficiency income and business taxes for its fiscal years
ended 30 September 1981 and 30 September 1982 in an aggregate amount of P1,410,157.71. The taxpayer
wrote back to state that since it had been able to avail itself of the tax amnesty, the deficiency tax notice should
forthwith be cancelled and withdrawn. The request was denied by the Commissioner, in his letter of 22
November 1988, on the ground that Revenue Memorandum Order No. 4-87, dated 09 February 1987,
implementing Executive Order No. 41, had construed the amnesty coverage to include only assessments issued
by the Bureau of Internal Revenue after the promulgation of the executive order on 22 August 1986 and not to
assessments theretofore made. The invoked provisions of the memorandum order read:
TO: All Internal Revenue Officers and Others Concerned:
1.0. To give effect and substance to the immunity provisions of the tax amnesty under Executive
Order No. 41, as expanded by Executive Order No. 64, the following instructions are hereby
issued:
xxx xxx xxx
1.02. A certification by the Tax Amnesty Implementation Officer of the fact of availment of the
said tax amnesty shall be a sufficient basis for:
xxx xxx xxx

1.02.3. In appropriate cases, the cancellation/withdrawal of assessment notices and letters of

demand issued after August 21, 1986 for the collection of income, business, estate or donor's
taxes due during the same taxable years. 1 (Emphasis supplied)
Private respondent appealed the Commissioner's denial to the Court of Tax Appeals. Ruling for the taxpayer,
the tax court said:
Respondent (herein petitioner Commissioner) failed to present any case or law which proves that
an assessment can withstand or negate the force and effects of a tax amnesty. This burden of
proof on the petitioner (herein respondent taxpayer) was created by the clear and express terms
of the executive order's intention qualified availers of the amnesty may pay an amnesty tax in
lieu of said unpaid taxes which are forgiven (Section 2, Section 5, Executive Order No. 41, as
amended). More specifically, the plain provisions in the statute granting tax amnesty for unpaid
taxes for the period January 1, 1981 to December 31, 1985 shifted the burden of proof on
respondent to show how the issuance of an assessment before the date of the promulgation of the
executive order could have a reasonable relation with the objective periods of the amnesty, so as
to make petitioner still answerable for a tax liability which, through the statute, should have been
erased with the proper availment of the amnesty.
Additionally, the exceptions enumerated in Section 4 of Executive Order No. 41, as amended, do
not indicate any reference to an assessment or pending investigation aside from one arising from
information furnished by an informer. . . . Thus, we deem that the rule in Revenue Memorandum
Order No. 4-87 promulgating that only assessments issued after August 21, 1986 shall be abated
by the amnesty is beyond the contemplation of Executive Order No. 41, as amended. 2
On appeal by the Commissioner to the Court of Appeals, the decision of the tax court was affirmed. The
appellate court further observed:
In the instant case, examining carefully the words used in Executive Order No. 41, as amended,
we find nothing which justifies petitioner Commissioner's ground for denying respondent
taxpayer's claim to the benefits of the amnesty law. Section 4 of the subject law enumerates, in
no uncertain terms, taxpayers who may not avail of the amnesty granted,. . . .
Admittedly, respondent taxpayer does not fall under any of the . . . exceptions. The added
exception urged by petitioner Commissioner based on Revenue Memorandum Order No. 4-87,
further restricting the scope of the amnesty clearly amounts to an act of administrative legislation
quite contrary to the mandate of the law which the regulation ought to implement.
xxx xxx xxx
Lastly, by its very nature, a tax amnesty, being a general pardon or intentional overlooking by
the State of its authority to impose penalties on persons otherwise guilty of evasion or violation
of a revenue or tax law, partakes of an absolute forgiveness or waiver by the Government of its
right to collect what otherwise would be due it, and in this sense, prejudicial thereto, particularly
to give tax evaders, who wish to relent and are willing to reform a chance to do so and thereby
become a part of the new society with a clean slate. (Republic vs. Intermediate Appellate Court.
196 SCRA 335, 340 [1991] citing Commissioner of Internal Revenue vs. Botelho Shipping
Corp., 20 SCRA 487) To follow [the restrictive application of Revenue Memorandum Order No.
4-87 pressed by petitioner Commissioner would be to work against the raison d'etre of E.O. 41,
as amended, i.e., to raise government revenues by encouraging taxpayers to declare their untaxed
income and pay the tax due thereon. (E.O. 41, first paragraph)] 3

In this petition for review, the Commissioner raises these related issues:
1. WHETHER OR NOT REVENUE MEMORANDUM ORDER NO. 4-87, PROMULGATED TO
IMPLEMENT E.O. NO. 41, IS VALID;
2. WHETHER OR NOT SAID DEFICIENCY ASSESSMENTS IN QUESTION WERE
EXTINGUISHED BY REASON OR PRIVATE RESPONDENT'S AVAILMENT OF EXECUTIVE
ORDER NO. 41 AS AMENDED BY EXECUTIVE ORDER NO. 64;
3. WHETHER OR NOT PRIVATE RESPONDENT HAS OVERCOME THE PRESUMPTION OF
VALIDITY OF ASSESSMENTS. 4
The authority of the Minister of Finance (now the Secretary of Finance), in conjunction with the Commissioner
of Internal Revenue, to promulgate all needful rules and regulations for the effective enforcement of internal
revenue laws cannot be controverted. Neither can it be disputed that such rules and regulations, as well as
administrative opinions and rulings, ordinarily should deserve weight and respect by the courts. Much more
fundamental than either of the above, however, is that all such issuances must not override, but must remain
consistent and in harmony with, the law they seek to apply and implement. Administrative rules and regulations
are intended to carry out, neither to supplant nor to modify, the law.
The real and only issue is whether or not the position taken by the Commissioner coincides with the meaning
and intent of executive Order No. 41.
We agree with both the court of Appeals and court of Tax Appeals that Executive Order No. 41 is quite explicit
and requires hardly anything beyond a simple application of its provisions. It reads:
Sec. 1. Scope of Amnesty. A one-time tax amnesty covering unpaid income taxes for the
years 1981 to 1985 is hereby declared.
Sec. 2. Conditions of the Amnesty. A taxpayer who wishes to avail himself of the tax amnesty
shall, on or before October 31, 1986;
a) file a sworn statement declaring his net worth as of December 31, 1985;
b) file a certified true copy of his statement declaring his net worth as of
December 31, 1980 on record with the Bureau of Internal Revenue, or if no such
record exists, file a statement of said net worth therewith, subject to verification
by the Bureau of Internal Revenue;
c) file a return and pay a tax equivalent to ten per cent (10%) of the increase in net
worth from December 31, 1980 to December 31, 1985: Provided, That in no case
shall the tax be less than P5,000.00 for individuals and P10,000.00 for judicial
persons.
Sec. 3. Computation of Net Worth. In computing the net worths referred to in Section 2
hereof, the following rules shall govern:
a) Non-cash assets shall be valued at acquisition cost.
b) Foreign currencies shall be valued at the rates of exchange prevailing as of the
date of the net worth statement.

Sec. 4. Exceptions. The following taxpayers may not avail themselves of the amnesty herein
granted:
a) Those falling under the provisions of Executive Order Nos. 1, 2 and 14;
b) Those with income tax cases already filed in Court as of the effectivity hereof;
c) Those with criminal cases involving violations of the income tax already filed
in court as of the effectivity filed in court as of the effectivity hereof;
d) Those that have withholding tax liabilities under the National Internal Revenue
Code, as amended, insofar as the said liabilities are concerned;
e) Those with tax cases pending investigation by the Bureau of Internal Revenue
as of the effectivity hereof as a result of information furnished under Section 316
of the National Internal Revenue Code, as amended;
f) Those with pending cases involving unexplained or unlawfully acquired wealth
before the Sandiganbayan;
g) Those liable under Title Seven, Chapter Three (Frauds, Illegal Exactions and
Transactions) and Chapter Four (Malversation of Public Funds and Property) of
the Revised Penal Code, as amended.
xxx xxx xxx
Sec. 9. The Minister of finance, upon the recommendation of the Commissioner of Internal
Revenue, shall promulgate the necessary rules and regulations to implement this Executive
Order.
xxx xxx xxx
Sec. 11. This Executive Order shall take effect immediately.
DONE in the City of Manila, this 22nd day of August in the year of Our Lord, nineteen hundred
and eighty-six.
The period of the amnesty was later extended to 05 December 1986 from 31 October 1986 by Executive Order
No. 54, dated 04 November 1986, and, its coverage expanded, under Executive Order No. 64, dated 17
November 1986, to include estate and honors taxes and taxes on business.
If, as the Commissioner argues, Executive Order No. 41 had not been intended to include 1981-1985 tax
liabilities already assessed (administratively) prior to 22 August 1986, the law could have simply so provided in
its exclusionary clauses. It did not. The conclusion is unavoidable, and it is that the executive order has been
designed to be in the nature of a general grant of tax amnesty subject only to the cases specifically excepted by
it.
It might not be amiss to recall that the taxable periods covered by the amnesty include the years immediately
preceding the 1986 revolution during which time there had been persistent calls, all too vivid to be easily
forgotten, for civil disobedience, most particularly in the payment of taxes, to the martial law regime. It should

be understandable then that those who ultimately took over the reigns of government following the successful
revolution would promptly provide for abroad, and not a confined, tax amnesty.
Relative to the two other issued raised by the Commissioner, we need only quote from Executive Order No. 41
itself; thus:
Sec. 6. Immunities and Privileges. Upon full compliance with the conditions of the tax
amnesty and the rules and regulations issued pursuant to this Executive order, the taxpayer shall
enjoy the following immunities and privileges:
a) The taxpayer shall be relieved of any income tax liability on any untaxed
income from January 1, 1981 to December 31, 1985, including increments thereto
and penalties on account of the non-payment of the said tax. Civil, criminal or
administrative liability arising from the non-payment of the said tax, which are
actionable under the National Internal Revenue Code, as amended, are likewise
deemed extinguished.
b) The taxpayer's tax amnesty declaration shall not be admissible in evidence in
all proceedings before judicial, quasi-judicial or administrative bodies, in which
he is a defendant or respondent, and the same shall not be examined, inquired or
looked into by any person, government official, bureau or office.
c) The books of account and other records of the taxpayer for the period from
January 1, 1981 to December 31, 1985 shall not be examined for income tax
purposes: Provided, That the Commissioner of Internal Revenue may authorize in
writing the examination of the said books of accounts and other records to verify
the validity or correctness of a claim for grant of any tax refund, tax credit (other
than refund on credit of withheld taxes on wages), tax incentives, and/or
exemptions under existing laws.
There is no pretension that the tax amnesty returns and due payments made by the taxpayer did not conform
with the conditions expressed in the amnesty order.
WHEREFORE, the decision of the court of Appeals, sustaining that of the court of Tax Appeals, is hereby
AFFIRMED in toto. No costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 116356 June 29, 1998

EASTERN SHIPPING LINES, INC., petitioner,
vs.
COURT OF APPEALS and DAVAO PILOTS ASSOCIATION, respondents.

PANGANIBAN, J.:
In Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals, 1 the Court, en banc,
ruled that Executive Order 1088 2 was not unconstitutional. We adhere to said ruling in this case.
The Case
This is a petition or certiorari under Rule 45, assailing the Decision 3 of the Court of Appeals 4 in CA-GR CV
No. 34487 promulgated on July 18, 1994, the dispositive portion of which reads:
WHEREFORE, finding no reversible error in the decision appealed from, the same is hereby
AFFIRMED in toto. With costs against defendant-appellant.
The Decision affirmed by Respondent Court disposed as follows:
WHEREFORE, judgment is rendered directing the defendant:
1. To pay plaintiff the sum of P602,710.04 with legal rate of
interest commencing from the filing of the complaint representing
unpaid pilotage fees;
2. To pay attorney's fees in the sum of P50,000.00;
3. And costs.
SO ORDERED.
Hence, this appeal. 5
The Facts
As found by the trial court, these are the undisputed facts:
On September 25, 1989, plaintiff [herein private respondent] elevated a complaint against
defendant [herein petitioner] for sum of money and attorney's fees alleging that plaintiff had

rendered pilotage services to defendant between January 14, 1987 to July 22, 1989 with total
unpaid fees of P703,290.18. Despite repeated demands, defendant failed to pay and prays that the
latter be directed to pay P703,290.18 with legal rate of interest from the filing of the complaint;
attorney's fees equivalent to 25% of the principal obligation and such other relief.
On November 18, 1989 defendant answered vigorously disputing the claims of plaintiff. It
assailed the constitutionality of the Executive Order 1088 upon which plaintiff bases its claims;
alleged that there is a pending case before the Court of Appeals elevated by the United Harbor
Pilots Association of the Philippines of which plaintiff is a member[;] whereas defendant is a
member of the Chamber of Maritime Industries of the Philippine[s] which is an Intervenor in
CA-G.R. SP No. 18072; that there therefore is lis pendens by Section 1 (e), Rule 16 of the Rules;
that the subject of the complaint falls within the scope and authority of the Philippine Ports
Authority by virtue of PD No. 857 dated December 23, 1975; that Executive Order No. 1088 is
an unwarranted repeal or modification of the Philippine Ports Authority Charter; that the fees
charged by plaintiff are arbitrary and confiscatory; and the basis of the Executive Order 1088 is
offensive, sourced from Amendment No. 6 of the 1973 Constitution and rendered inoperative by
the Freedom Constitution of March 25, 1986 and the present Constitution; and that the only
agency vested by law to prescribe such rates, charges or fees for services rendered by any private
organization like the plaintiff within a Port District is governed by Section 20 of PD 857. As
regular patron of plaintiff, defendant has never been remiss in paying plaintiff's claim for
pilotage fees and the present complaint under the foregoing circumstances is without legal
foundation. Defendant prays that plaintiff be advised to await the final outcome of the identical
issues already elevated to and pending before the Court of Appeals as CA-G.R. SP No. 18072.
Defendant prays for an award of damages, attorney's fees, litigation expense and costs.
At the Pre-Trial Conference, the only issue raised by plaintiff is whether the defendant is liable
to the plaintiff for the money claims alleged in the complaint.
The defendant on the other hand raised the following issues:
1. Whether or not Executive Order 1088 is constitutional;
2. Whether or not Executive Order 1088 is illegal;
3. Whether or not the plaintiff may motu proprio and
independently of the Public Estates Authority enforce Executive
Order 1088 and collect the pilotage fees prescribed thereunder;
4. Assuming Executive Order 1088 is constitutional, valid and selfexecutory, whether or not the defendant is liable; and if so, to what
extent and for what particular items; and
5. Whether or not the plaintiff is liable under the counterclaims (p.
102, Expediente).
On September 5, 1990, plaintiff presented witness Capt. Felix N. Galope, in the course of which
testimony identified among others EXHIBITS "B" to "E-2" and "J" to "1-2" consisting of
documents related to the collection of the unpaid pilotage fees; basis for such computations;
Statement of Accounts; demand letter and official recipients of payment made.
On September 6, 1990, Simplicio Barao, plaintiff's Billing Clerk testified among others on the
records of plaintiff's Captain's Certificate/Pilotage Chits and Bills/Statements of Accounts on the

claims against defendant (EXHIBITS "G" to "H-48-A") and the details of the outstanding
accounts in favor of plaintiff. The records show defendant raised no objection thereto and by
virtue of which all of plaintiff's documentary exhibits were admitted. (Order dated January 14,
1991, p. 277 Expediente).
On March 14, 1991, defendant presented Celso Occidental, employee of defendant shipping
company, in the course of which testimony submitted EXHIBITS "1" to "1-D" which is
plaintiff's Billing Rate, both old and new with a payment of P79,585.64; and "2" to "2-G"
representing plane ticket paid for by defendant for transportation expenses of its counsel and cost
of stenographic transcripts.
Defendant's last witness, Capt. Jose Dubouzet, Jr. and a Harbor Pilot was briefly presented. 6
After due trial, the trial court rendered its ruling, viz.:
Plaintiff's evidence as to the unpaid pilotage services due from defendant duly supported by
voluminous documentary exhibits has not been refuted nor rebutted by defendant. On the
contrary, when plaintiff's documentary exhibits were formally offered, defendant did not raise
any objection thereby leaving the documents unchallenged and undisputed.
Upon the other hand, while the records show that defendant raised no less than five (5) issues the
evidence fails to show any proof to sustain defendant's posture. On the contrary, neither of
defendant's two witnesses appear to have even grazed the outer peripheries of what could have
been interesting issues with far-reaching consequences if resolved. 7
The factual antecedents of the controversy are simple. Petitioner insists on paying pilotage fees prescribed under
PPA circulars. Because EO 1088 sets a higher rate, petitioner now assails its constitutionality.
Public Respondent's Ruling
As stated earlier, Respondent Court of Appeals affirmed the trial court's decision. Respondent Court pointed out
that petitioner, during the pre-trial, limited the issues to whether: (1) EO C88 is unconstitutional; (2) EO 1088 is
illegal; (3) private respondent itself may enforce and collect fees under EO 1088; and (4) petitioner is liable and,
if EO 1088 is legal, to what extent. It then affirmed the factual findings and conclusion of the trial court that
petitioner "fail[ed] to show any proof" to support its position. Parenthetically, Respondent Court also noted two
other cases decided by the Court of Appeals, upholding the constitutionality of EO 1088. 8
The Issue
In sum, petitioner raises this main issue: whether Executive Order 1088 is unconstitutional. 9
The Court's Ruling
The petition is unmeritorious.
EO 1088 Is Valid
Petitioner contends that EO 1088 10 is unconstitutional, because (1) its interpretation and application are left to
private respondent, a private person, 11 and (2) it constitutes an undue delegation of powers. Petitioner insists
that it should pay pilotage fees in accordance with and on the basis of the memorandum circulars issued by the
PPA, the administrative body vested under PD 857 12 with the power to regulate and prescribe pilotage fees. In

assailing the constitutionality of EO 1088, the petitioner repeatedly asks: "Is the private respondent vested with
power to interpret Executive Order No. 1088?" 13
The Court is not persuaded. The pertinent provisions of EO 1088 read:
Sec. 1. The following shall be the rate of pilotage fees or charges based on tonnage for services
rendered to both foreign and coastwise vessels:
For Foreign Vessels Rate in US$ &/or its
Peso Equivalent
Less than 500GT $ 30.00
500GT to 2,500GT 43.33
2,500GT to 5,000GT 71.33
5,000GT to 10,000GT 133.67
10,000GT to 15,000GT 181.67
15,000GT to 20,000GT 247.00
20,000GT to 30,000GT 300.00
30,000GT to 40,000GT 416.67
40,000GT to 60,000GT 483.33
60,000GT to 80,000GT 550.00
80,000GT to 100,000GT 616.67
100,000GT to 120,000GT 666.67
120,000GT to 130,000GT 716.67
130,000GT to 140,000GT 766.67
Over 140,000 gross tonnage $0.05 or its peso equivalent every excess tonnage. Rate for docking
and undocking anchorage, conduction and shifting other related special services is equal to
100%. Pilotage services shall be compulsory in government and private wharves or piers.
For Coastwise Vessels Regular
100 and under 500 gross tons P 41.70
500 and under 600 gross tons 55.60
600 and under 1,000 gross tons 69.60

1,000 and under 3,000 gross tons 139.20

3,000 and under 5,000 gross tons 300.00
5,000 and over gross tons
Sec. 2. With respect to foreign vessels, payment of pilotage services shall be made in dollars or
in pesos at the prevailing exchange rate.
Sec. 3. All orders, letters of instructions, rules, regulations and other issuances inconsistent with
this Executive Order are hereby repealed or amended accordingly.
Sec. 4. This Executive Order shall take effect immediately.
In Philippine Interisland Shipping Association of the Philippines vs. Court of Appeals, 14 the Supreme Court,
through Mr. Justice Vicente V. Mendoza, upheld the validity and constitutionality of Executive Order 1088 in
no uncertain terms. We aptly iterate our pronouncement in said case, viz.:
It is not an answer to say that E.O. No. 1088 should not be considered a statute because that
would imply the withdrawal of power from the PPA. What determines whether an act is a law or
an administrative issuance is not its form but its nature. Here as we have already said, the power
to fix the rates of charges for services, including pilotage service, has always been regarded as
legislative in character.
xxx xxx xxx
It is worthy to note that E.O. NO. 1088 provides for adjusted pilotage service rates without
withdrawing the power of the PPA to impose, prescribe, increase or decrease rates, charges or
fees. The reason is because E.O. No. 1088 is not meant simply to fix new pilotage rates. Its
legislative purpose is the "rationalization of pilotage service charges, through the imposition of
uniform and adjusted rates for foreign and coastwise vessels in all Philippine ports.
xxx xxx xxx
We conclude that E.O. No. 1088 is a valid statute and that the PPA is duty bound to comply with
its provisions. The PPA may increase the rates but it may not decrease them below those
mandated by E.O. No. 1088. . . . . 15
We see no reason to depart from this ruling. The Court's holding clearly debunks petitioner's insistence on
paying its pilotage fees based on memorandum circulars issued by the PPA. 16 Because the PPA circulars are
inconsistent with EO 1088, they are void and ineffective. "Administrative or executive acts, orders and
regulations shall be valid only when they are not contrary to the laws or the Constitution." 17 As stated by this
Court in Land Bank of the Philippines vs. Court of Appeals, 18 "[t]he conclusive effect of administrative
construction is not absolute. Action of an administrative agency may be disturbed or set aside by the judicial
department if there is an error of law, a grave abuse of power or lack of jurisdiction, or grave abuse of discretion
clearly conflicting with either the letter or spirit of the law." 19 It is axiomatic that an administrative agency, like
the PPA, has no discretion whether to implement the law or not. Its duty is to enforce it. Unarguably, therefore,
if there is any conflict between the PPA circular and a law, such as EO 1088, the latter prevails. 20
Based on the foregoing, petitioner has no legal basis to refuse payment of pilotage fees to private respondent, as
computed according to the rates set by EO 1088. Private respondent cannot be faulted for relying on the clear

and unmistakable provisions of EO 1088. In fact, EO 1088 leaves no room for interpretation, thereby
unmistakably showing the duplicity of petitioner's query: "Is the private respondent vested with power to
interpret Executive Order No. 10882?"
WHEREFORE, the petition is hereby DENIED and the assailed Decision of the Court of Appeals is
AFFIRMED. Costs against petitioner.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 127685 July 23, 1998

BLAS F. OPLE, petitioner,
vs.
RUBEN D. TORRES, ALEXANDER AGUIRRE, HECTOR VILLANUEVA, CIELITO HABITO,
ROBERT BARBERS, CARMENCITA REODICA, CESAR SARINO, RENATO VALENCIA, TOMAS
P. AFRICA, HEAD OF THE NATIONAL COMPUTER CENTER and CHAIRMAN OF THE
COMMISSION ON AUDIT, respondents.

PUNO, J.:
The petition at bar is a commendable effort on the part of Senator Blas F. Ople to prevent the shrinking of the
right to privacy, which the revered Mr. Justice Brandeis considered as "the most comprehensive of rights and
the right most valued by civilized men." 1 Petitioner Ople prays that we invalidate Administrative Order No.
308 entitled "Adoption of a National Computerized Identification Reference System" on two important
constitutional grounds, viz: one, it is a usurpation of the power of Congress to legislate, and two, it
impermissibly intrudes on our citizenry's protected zone of privacy. We grant the petition for the rights sought
to be vindicated by the petitioner need stronger barriers against further erosion.
A.O. No. 308 was issued by President Fidel V. Ramos On December 12, 1996 and reads as follows:
ADOPTION OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM
WHEREAS, there is a need to provide Filipino citizens and foreign residents with the facility to
conveniently transact business with basic service and social security providers and other
government instrumentalities;
WHEREAS, this will require a computerized system to properly and efficiently identify persons
seeking basic services on social security and reduce, if not totally eradicate fraudulent
transactions and misrepresentations;
WHEREAS, a concerted and collaborative effort among the various basic services and social
security providing agencies and other government intrumentalities is required to achieve such a
system;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by
virtue of the powers vested in me by law, do hereby direct the following:

Sec. 1. Establishment of a National Compoterized Identification Reference System. A

decentralized Identification Reference System among the key basic services and social security
providers is hereby established.
Sec. 2. Inter-Agency Coordinating Committee. An Inter-Agency Coordinating Committee
(IACC) to draw-up the implementing guidelines and oversee the implementation of the System is
hereby created, chaired by the Executive Secretary, with the following as members:
Head, Presidential Management Staff
Secretary, National Economic Development Authority
Secretary, Department of the Interior and Local Government
Secretary, Department of Health
Administrator, Government Service Insurance System,
Administrator, Social Security System,
Administrator, National Statistics Office
Managing Director, National Computer Center.
Sec. 3. Secretariat. The National Computer Center (NCC) is hereby designated as secretariat to
the IACC and as such shall provide administrative and technical support to the IACC.
Sec. 4. Linkage Among Agencies. The Population Reference Number (PRN) generated by the
NSO shall serve as the common reference number to establish a linkage among concerned
agencies. The IACC Secretariat shall coordinate with the different Social Security and Services
Agencies to establish the standards in the use of Biometrics Technology and in computer
application designs of their respective systems.
Sec. 5. Conduct of Information Dissemination Campaign. The Office of the Press Secretary, in
coordination with the National Statistics Office, the GSIS and SSS as lead agencies and other
concerned agencies shall undertake a massive tri-media information dissemination campaign to
educate and raise public awareness on the importance and use of the PRN and the Social Security
Identification Reference.
Sec. 6. Funding. The funds necessary for the implementation of the system shall be sourced from
the respective budgets of the concerned agencies.
Sec. 7. Submission of Regular Reports. The NSO, GSIS and SSS shall submit regular reports to
the Office of the President through the IACC, on the status of implementation of this
undertaking.
Sec. 8. Effectivity. This Administrative Order shall take effect immediately.
DONE in the City of Manila, this 12th day of December in the year of Our Lord, Nineteen
Hundred and Ninety-Six.

(SGD.) FIDEL V. RAMOS

A.O. No. 308 was published in four newspapers of general circulation on January 22, 1997 and January 23,
1997. On January 24, 1997, petitioner filed the instant petition against respondents, then Executive Secretary
Ruben Torres and the heads of the government agencies, who as members of the Inter-Agency Coordinating
Committee, are charged with the implementation of A.O. No. 308. On April 8, 1997, we issued a temporary
restraining order enjoining its implementation.
Petitioner contends:
A. THE ESTABLISNMENT OF A NATIONAL COMPUTERIZED IDENTIFICATION
REFERENCE SYSTEM REQUIRES A LEGISLATIVE ACT. THE ISSUANCE OF A.O. NO.
308 BY THE PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES IS, THEREFORE,
AN UNCONSTITUTIONAL USURPATION OF THE LEGISLATIVE POWERS OF THE
CONGRESS OF THE REPUBLIC OF THE PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY THE PRESIDENT FOR THE
IMPLEMENTATION OF A.O. NO. 308 IS AN UNCONSTITUTIONAL USURPATION OF
THE EXCLUSIVE RIGHT OF CONGRESS TO APPROPRIATE PUBLIC FUNDS FOR
EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308 INSIDIOUSLY LAYS THE GROUNDWORK
FOR A SYSTEM WHICH WILL VIOLATE THE BILL OF RIGHTS ENSHRINED IN THE
CONSTITUTION. 2
Respondents counter-argue:
A. THE INSTANT PETITION IS NOT A JUSTICIABLE CASE AS WOULD WARRANT A
JUDICIAL REVIEW;
B. A.O. NO. 308 [1996] WAS ISSUED WITHIN THE EXECUTIVE AND
ADMINISTRATIVE POWERS OF THE PRESIDENT WITHOUT ENCROACHING ON THE
LEGISLATIVE POWERS OF CONGRESS;
C. THE FUNDS NECESSARY FOR THE IMPLEMENTATION OF THE IDENTIFICATION
REFERENCE SYSTEM MAY BE SOURCED FROM THE BUDGETS OF THE
CONCERNED AGENCIES;
D. A.O. NO. 308 [1996] PROTECTS AN INDIVIDUAL'S INTEREST IN PRIVACY. 3
We now resolve.
I
As is usual in constitutional litigation, respondents raise the threshold issues relating to the standing to sue of
the petitioner and the justiciability of the case at bar. More specifically, respondents aver that petitioner has no
legal interest to uphold and that the implementing rules of A.O. No. 308 have yet to be promulgated.
These submissions do not deserve our sympathetic ear. Petitioner Ople is a distinguished member of our Senate.
As a Senator, petitioner is possessed of the requisite standing to bring suit raising the issue that the issuance of
A.O. No. 308 is a usurpation of legislative power. 4 As taxpayer and member of the Government Service

Insurance System (GSIS), petitioner can also impugn the legality of the misalignment of public funds and the
misuse of GSIS funds to implement A.O. No. 308. 5
The ripeness for adjudication of the Petition at bar is not affected by the fact that the implementing rules of A.O.
No. 308 have yet to be promulgated. Petitioner Ople assails A.O. No. 308 as invalid per se and as infirmed on
its face. His action is not premature for the rules yet to be promulgated cannot cure its fatal defects. Moreover,
the respondents themselves have started the implementation of A.O. No. 308 without waiting for the rules. As
early as January 19, 1997, respondent Social Security System (SSS) caused the publication of a notice to bid for
the manufacture of the National Identification (ID) card. 6 Respondent Executive Secretary Torres has publicly
announced that representatives from the GSIS and the SSS have completed the guidelines for the national
identification system. 7 All signals from the respondents show their unswerving will to implement A.O. No. 308
and we need not wait for the formality of the rules to pass judgment on its constitutionality. In this light, the
dissenters insistence that we tighten the rule on standing is not a commendable stance as its result would be to
throttle an important constitutional principle and a fundamental right.
II
We now come to the core issues. Petitioner claims that A.O. No. 308 is not a mere administrative order but a
law and hence, beyond the power of the President to issue. He alleges that A.O. No. 308 establishes a system of
identification that is all-encompassing in scope, affects the life and liberty of every Filipino citizen and foreign
resident, and more particularly, violates their right to privacy.
Petitioner's sedulous concern for the Executive not to trespass on the lawmaking domain of Congress is
understandable. The blurring of the demarcation line between the power of the Legislature to make laws and the
power of the Executive to execute laws will disturb their delicate balance of power and cannot be allowed.
Hence, the exercise by one branch of government of power belonging to another will be given a stricter scrutiny
by this Court.
The line that delineates Legislative and Executive power is not indistinct. Legislative power is "the authority,
under the Constitution, to make laws, and to alter and repeal them." 8 The Constitution, as the will of the people
in their original, sovereign and unlimited capacity, has vested this power in the Congress of the
Philippines. 9 The grant of legislative power to Congress is broad, general and comprehensive. 10 The legislative
body possesses plenary power for all purposes of civil government. 11 Any power, deemed to be legislative by
usage and tradition, is necessarily possessed by Congress, unless the Constitution has lodged it elsewhere. 12 In
fine, except as limited by the Constitution, either expressly or impliedly, legislative power embraces all subjects
and extends to matters of general concern or common interest. 13
While Congress is vested with the power to enact laws, the President executes the laws. 14 The executive power
is vested in the Presidents. 15 It is generally defined as the power to enforce and administer the laws. 16 It is the
power of carrying the laws into practical operation and enforcing their due observance. 17
As head of the Executive Department, the President is the Chief Executive. He represents the government as a
whole and sees to it that all laws are enforced by the officials and employees of his department. 18 He has
control over the executive department, bureaus and offices. This means that he has the authority to assume
directly the functions of the executive department, bureau and office or interfere with the discretion of its
officials. 19 Corollary to the power of control, the President also has the duty of supervising the enforcement of
laws for the maintenance of general peace and public order. Thus, he is granted administrative power over
bureaus and offices under his control to enable him to discharge his duties effectively. 20
Administrative power is concerned with the work of applying policies and enforcing orders as determined by
proper governmental organs. 21 It enables the President to fix a uniform standard of administrative efficiency

and check the official conduct of his agents. 22 To this end, he can issue administrative orders, rules and
regulations.
Prescinding from these precepts, we hold that A.O. No. 308 involves a subject that is not appropriate to be
covered by an administrative order. An administrative order is:
Sec. 3. Administrative Orders. Acts of the President which relate to particular aspects of
governmental operation in pursuance of his duties as administrative head shall be promulgated in
administrative orders. 23
An administrative order is an ordinance issued by the President which relates to specific aspects in the
administrative operation of government. It must be in harmony with the law and should be for the sole
purpose of implementing the law and carrying out the legislative policy. 24 We reject the argument that
A.O. No. 308 implements the legislative policy of the Administrative Code of 1987. The Code is a
general law and "incorporates in a unified document the major structural, functional and procedural
principles of governance." 25 and "embodies changes in administrative structure and procedures designed
to serve the
people." 26 The Code is divided into seven (7) Books: Book I deals with Sovereignty and General
Administration, Book II with the Distribution of Powers of the three branches of Government, Book III
on the Office of the President, Book IV on the Executive Branch, Book V on Constitutional
Commissions, Book VI on National Government Budgeting, and Book VII on Administrative
Procedure. These Books contain provisions on the organization, powers and general administration of
the executive, legislative and judicial branches of government, the organization and administration of
departments, bureaus and offices under the executive branch, the organization and functions of the
Constitutional Commissions and other constitutional bodies, the rules on the national government
budget, as well as guideline for the exercise by administrative agencies of quasi-legislative and quasijudicial powers. The Code covers both the internal administration of government, i.e, internal
organization, personnel and recruitment, supervision and discipline, and the effects of the functions
performed by administrative officials on private individuals or parties outside government. 27
It cannot be simplistically argued that A.O. No. 308 merely implements the Administrative Code of 1987. It
establishes for the first time a National Computerized Identification Reference System. Such a System requires
a delicate adjustment of various contending state policies the primacy of national security, the extent of
privacy interest against dossier-gathering by government, the choice of policies, etc. Indeed, the dissent of Mr.
Justice Mendoza states that the A.O. No. 308 involves the all-important freedom of thought. As said
administrative order redefines the parameters of some basic rights of our citizenry vis-a-vis the State as well as
the line that separates the administrative power of the President to make rules and the legislative power of
Congress, it ought to be evident that it deals with a subject that should be covered by law.
Nor is it correct to argue as the dissenters do that A.D. No. 308 is not a law because it confers no right, imposes
no duty, affords no proctection, and creates no office. Under A.O. No. 308, a citizen cannot transact business
with government agencies delivering basic services to the people without the contemplated identification card.
No citizen will refuse to get this identification card for no one can avoid dealing with government. It is thus
clear as daylight that without the ID, a citizen will have difficulty exercising his rights and enjoying his
privileges. Given this reality, the contention that A.O. No. 308 gives no right and imposes no duty cannot stand.
Again, with due respect, the dissenting opinions unduly expand the limits of administrative legislation and
consequently erodes the plenary power of Congress to make laws. This is contrary to the established approach
defining the traditional limits of administrative legislation. As well stated by Fisher: ". . . Many regulations
however, bear directly on the public. It is here that administrative legislation must he restricted in its scope and
application. Regulations are not supposed to be a substitute for the general policy-making that Congress enacts

in the form of a public law. Although administrative regulations are entitled to respect, the authority to prescribe
rules and regulations is not an independent source of power to make laws." 28
III
Assuming, arguendo, that A.O. No. 308 need not be the subject of a law, still it cannot pass constitutional
muster as an administrative legislation because facially it violates the right to privacy. The essence of privacy is
the "right to be let alone." 29 In the 1965 case of Griswold v. Connecticut, 30 the United States Supreme Court
gave more substance to the right of privacy when it ruled that the right has a constitutional foundation. It held
that there is a right of privacy which can be found within the penumbras of the First, Third, Fourth, Fifth and
Ninth Amendments, 31 viz:
Specific guarantees in the Bill of Rights have penumbras formed by emanations from these
guarantees that help give them life and substance . . . various guarantees create zones of privacy.
The right of association contained in the penumbra of the First Amendment is one, as we have
seen. The Third Amendment in its prohibition against the quartering of soldiers "in any house" in
time of peace without the consent of the owner is another facet of that privacy. The Fourth
Amendment explicitly affirms the ''right of the people to be secure in their persons, houses and
effects, against unreasonable searches and seizures." The Fifth Amendment in its SelfIncrimination Clause enables the citizen to create a zone of privacy which government may not
force him to surrender to his detriment. The Ninth Amendment provides: "The enumeration in
the Constitution, of certain rights, shall not be construed to deny or disparage others retained by
the people."
In the 1968 case of Morfe v. Mutuc, 32 we adopted the Griswold ruling that there is a constitutional right
to privacy. Speaking thru Mr. Justice, later Chief Justice, Enrique Fernando, we held:
xxx xxx xxx
The Griswold case invalidated a Connecticut statute which made the use of contraceptives a
criminal offence on the ground of its amounting to an unconstitutional invasion of the right of
privacy of married persons; rightfully it stressed "a relationship lying within the zone of privacy
created by several fundamental constitutional guarantees." It has wider implications though. The
constitutional right to privacy has come into its own.
So it is likewise in our jurisdiction. The right to privacy as such is accorded recognition
independently of its identification with liberty; in itself, it is fully deserving of constitutional
protection. The language of Prof. Emerson is particularly apt: "The concept of limited
government has always included the idea that governmental powers stop short of certain
intrusions into the personal life of the citizen. This is indeed one of the basic distinctions
between absolute and limited government. Ultimate and pervasive control of the individual, in all
aspects of his life, is the hallmark of the absolute state. In contrast, a system of limited
government safeguards a private sector, which belongs to the individual, firmly distinguishing it
from the public sector, which the state can control. Protection of this private sector protection,
in other words, of the dignity and integrity of the individual has become increasingly
important as modern society has developed. All the forces of a technological age
industrialization, urbanization, and organization operate to narrow the area of privacy and
facilitate intrusion into it. In modern terms, the capacity to maintain and support this enclave of
private life marks the difference between a democratic and a totalitarian society."
Indeed, if we extend our judicial gaze we will find that the right of privacy is recognized and enshrined in
several provisions of our Constitution. 33 It is expressly recognized in section 3 (1) of the Bill of Rights:

Sec. 3. (1) The privacy of communication and correspondence shall be inviolable except upon
lawful order of the court, or when public safety or order requires otherwise as prescribed by law.
Other facets of the right to privacy are protectad in various provisions of the Bill of Rights, viz: 34
Sec. 1. No person shall be deprived of life, liberty, or property without due process of law, nor
shall any person be denied the equal protection of the laws.
Sec. 2. The right of the people to be secure in their persons, houses papers, and effects against
unreasonable searches and seizures of whatever nature and for any purpose shall be inviolable,
and no search warrant or warrant of arrest shall issue except upon probable cause to be
determined personally by the judge after examination under oath or affirmation of the
complainant and the witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized.
xxx xxx xxx
Sec. 6. The liberty of abode and of changing the same within the limits prescribed by law shall
not be impaired except upon lawful order of the court. Neither shall the right to travel be
impaired except in the interest of national security, public safety, or public health as may be
provided by law.
xxx xxx xxx
Sec. 8. The right of the people, including those employed in the public and private sectors, to
form unions, associations, or societies for purposes not contrary to law shall not be abridged.
Sec. 17. No person shall be compelled to be a witness against himself.
Zones of privacy are likewise recognized and protected in our laws. The Civil Code provides that "[e]very
person shall respect the dignity, personality, privacy and peace of mind of his neighbors and other persons" and
punishes as actionable torts several acts by a person of meddling and prying into the privacy of another. 35 It
also holds a public officer or employee or any private individual liable for damages for any violation of the
rights and liberties of another person, 36 and recognizes the privacy of letters and other private
communications. 37 The Revised Penal Code makes a crime the violation of secrets by an officer, 38 the
revelation of trade and industrial secrets, 39 and trespass to dwelling. 40Invasion of privacy is an offense in
special laws like the Anti-Wiretapping Law, 41 the Secrecy of Bank Deposits Act 42 and the Intellectual Property
Code. 43 The Rules of Court on privileged communication likewise recognize the privacy of certain
information. 44
Unlike the dissenters, we prescind from the premise that the right to privacy is a fundamental right guaranteed
by the Constitution, hence, it is the burden of government to show that A.O. No. 308 is justified by some
compelling state interest and that it is narrowly drawn. A.O. No. 308 is predicated on two considerations: (1) the
need to provides our citizens and foreigners with the facility to conveniently transact business with basic service
and social security providers and other government instrumentalities and (2) the need to reduce, if not totally
eradicate, fraudulent transactions and misrepresentations by persons seeking basic services. It is debatable
whether these interests are compelling enough to warrant the issuance of A.O. No. 308. But what is not arguable
is the broadness, the vagueness, the overbreadth of A.O. No. 308 which if implemented will put our people's
right to privacy in clear and present danger.

The heart of A.O. No. 308 lies in its Section 4 which provides for a Population Reference Number (PRN) as a
"common reference number to establish a linkage among concerned agencies" through the use of "Biometrics
Technology" and "computer application designs."
Biometry or biometrics is "the science of the applicatin of statistical methods to biological facts; a mathematical
analysis of biological data." 45 The term "biometrics" has evolved into a broad category of technologies which
provide precise confirmation of an individual's identity through the use of the individual's own physiological
and behavioral characteristics. 46 A physiological characteristic is a relatively stable physical characteristic such
as a fingerprint, retinal scan, hand geometry or facial features. A behavioral characteristic is influenced by the
individual's personality and includes voice print, signature and keystroke. 47 Most biometric idenfication
systems use a card or personal identificatin number (PIN) for initial identification. The biometric measurement
is used to verify that the individual holding the card or entering the PIN is the legitimate owner of the card or
PIN. 48
A most common form of biological encoding is finger-scanning where technology scans a fingertip and turns
the unique pattern therein into an individual number which is called a biocrypt. The biocrypt is stored in
computer data banks 49 and becomes a means of identifying an individual using a service. This technology
requires one's fingertip to be scanned every time service or access is provided. 50 Another method is the retinal
scan. Retinal scan technology employs optical technology to map the capillary pattern of the retina of the eye.
This technology produces a unique print similar to a finger print. 51 Another biometric method is known as the
"artificial nose." This device chemically analyzes the unique combination of substances excreted from the skin
of people. 52 The latest on the list of biometric achievements is the thermogram. Scientists have found that by
taking pictures of a face using infra-red cameras, a unique heat distribution pattern is seen. The different
densities of bone, skin, fat and blood vessels all contribute to the individual's personal "heat signature." 53
In the last few decades, technology has progressed at a galloping rate. Some science fictions are now science
facts. Today, biometrics is no longer limited to the use of fingerprint to identify an individual. It is a new
science that uses various technologies in encoding any and all biological characteristics of an individual for
identification. It is noteworthy that A.O. No. 308 does not state what specific biological characteristics and what
particular biometrics technology shall be used to identify people who will seek its coverage. Considering the
banquest of options available to the implementors of A.O. No. 308, the fear that it threatens the right to privacy
of our people is not groundless.
A.O. No. 308 should also raise our antennas for a further look will show that it does not state whether encoding
of data is limited to biological information alone for identification purposes. In fact, the Solicitor General claims
that the adoption of the Identification Reference System will contribute to the "generation of population data for
development planning." 54 This is an admission that the PRN will not be used solely for identification but the
generation of other data with remote relation to the avowed purposes of A.O. No. 308. Clearly, the
indefiniteness of A.O. No. 308 can give the government the roving authority to store and retrieve information
for a purpose other than the identification of the individual through his PRN.
The potential for misuse of the data to be gathered under A.O. No. 308 cannot be undarplayed as the dissenters
do. Pursuant to said administrative order, an individual must present his PRN everytime he deals with a
government agency to avail of basic services and security. His transactions with the government agency will
necessarily be recorded whether it be in the computer or in the documentary file of the agency. The
individual's file may include his transactions for loan availments, income tax returns, statement of assets and
liabilities, reimbursements for medication, hospitalization, etc. The more frequent the use of the PRN, the better
the chance of building a huge formidable informatin base through the electronic linkage of the files. 55 The data
may be gathered for gainful and useful government purposes; but the existence of this vast reservoir of personal
information constitutes a covert invitation to misuse, a temptation that may be too great for some of our
authorities to resist. 56

We can even grant, arguendo, that the computer data file will be limited to the name, address and other basic
personal infomation about the individual. 57 Even that hospitable assumption will not save A.O. No. 308 from
constitutional infirmity for again said order does not tell us in clear and categorical terms how these information
gathered shall he handled. It does not provide who shall control and access the data, under what circumstances
and for what purpose. These factors are essential to safeguard the privacy and guaranty the integrity of the
information. 58 Well to note, the computer linkage gives other government agencies access to the information.
Yet, there are no controls to guard against leakage of information. When the access code of the control
programs of the particular computer system is broken, an intruder, without fear of sanction or penalty, can make
use of the data for whatever purpose, or worse, manipulate the data stored within the system. 59
It is plain and we hold that A.O. No. 308 falls short of assuring that personal information which will be gathered
about our people will only be processed for unequivocally specified purposes. 60 The lack of proper safeguards
in this regard of A.O. No. 308 may interfere with the individual's liberty of abode and travel by enabling
authorities to track down his movement; it may also enable unscrupulous persons to access confidential
information and circumvent the right against self-incrimination; it may pave the way for "fishing expeditions"
by government authorities and evade the right against unreasonable searches and seizures. 61 The possibilities of
abuse and misuse of the PRN, biometrics and computer technology are accentuated when we consider that the
individual lacks control over what can be read or placed on his ID, much less verify the correctness of the data
encoded. 62 They threaten the very abuses that the Bill of Rights seeks to prevent. 63
The ability of sophisticated data center to generate a comprehensive cradle-to-grave dossier on an individual
and transmit it over a national network is one of the most graphic threats of the computer revolution. 64 The
computer is capable of producing a comprehensive dossier on individuals out of information given at different
times and for varied purposes. 65 It can continue adding to the stored data and keeping the information up to
date. Retrieval of stored date is simple. When information of a privileged character finds its way into the
computer, it can be extracted together with other data on the subject. 66 Once extracted, the information is putty
in the hands of any person. The end of privacy begins.
Though A.O. No. 308 is undoubtedly not narrowly drawn, the dissenting opinions would dismiss its danger to
the right to privacy as speculative and hypothetical. Again, we cannot countenance such a laidback posture. The
Court will not be true to its role as the ultimate guardian of the people's liberty if it would not immediately
smother the sparks that endanger their rights but would rather wait for the fire that could consume them.
We reject the argument of the Solicitor General that an individual has a reasonable expectation of privacy with
regard to the Natioal ID and the use of biometrics technology as it stands on quicksand. The reasonableness of a
person's expectation of privacy depends on a two-part test: (1) whether by his conduct, the individual has
exhibited an expectation of privacy; and (2) whether this expectation is one that society recognizes as
reasonable.67 The factual circumstances of the case determines the reasonableness of the
expectation. 68 However, other factors, such as customs, physical surroundings and practices of a particular
activity, may serve to create or diminish this expectation. 69The use of biometrics and computer technology in
A.O. No. 308 does not assure the individual of a reasonable expectation of privacy. 70 As technology advances,
the level of reasonably expected privacy decreases. 71 The measure of protection granted by the reasonable
expectation diminishes as relevant technology becomes more widely accepted. 72 The security of the computer
data file depends not only on the physical inaccessibility of the file but also on the advances in hardware and
software computer technology. A.O. No. 308 is so widely drawn that a minimum standard for a reasonable
expectation of privacy, regardless of technology used, cannot be inferred from its provisions.
The rules and regulations to be by the IACC cannot remedy this fatal defect. Rules and regulations merely
implement the policy of the law or order. On its face, A.O. No. gives the IACC virtually infettered discretion to
determine the metes and bounds of the ID System.

Nor do your present laws prvide adequate safeguards for a reasonable expectation of privacy. Commonwealth
Act. No. 591 penalizes the disclosure by any person of data furnished by the individual to the NSO with
imprisonment and fine. 73 Republic Act. No. 1161 prohibits public disclosure of SSS employment records and
reports. 74 These laws, however, apply to records and data with the NSO and the SSS. It is not clear whether
they may be applied to data with the other government agencies forming part of the National ID System. The
need to clarify the penal aspect of A.O. No. 308 is another reason why its enactment should be given to
Congress.
Next, the Solicitor General urges us to validate A.O. No. 308's abridgment of the right of privacy by using the
rational relationship test. 75 He stressed that the purposes of A.O. No. 308 are: (1) to streamline and speed up the
implementation of basic government services, (2) eradicate fraud by avoiding duplication of services, and (3)
generate population data for development planning. He cocludes that these purposes justify the incursions into
the right to privacy for the means are rationally related to the end. 76
We are not impressed by the argument. In Morfe v. Mutuc, 77 we upheld the constitutionality of R.A. 3019, the
Anti-Graft and Corrupt Practices Act, as a valid police power measure. We declared that the law, in compelling
a public officer to make an annual report disclosing his assets and liabilities, his sources of income and
expenses, did not infringe on the individual's right to privacy. The law was enacted to promote morality in
public administration by curtailing and minimizing the opportunities for official corruption and maintaining a
standard of honesty in the public service. 78
The same circumstances do not obtain in the case at bar. For one, R.A. 3019 is a statute, not an administrative
order. Secondly, R.A. 3019 itself is sufficiently detailed. The law is clear on what practices were prohibited and
penalized, and it was narrowly drawn to avoid abuses. IN the case at bar, A.O. No. 308 may have been impelled
by a worthy purpose, but, it cannot pass constitutional scrutiny for it is not narrowly drawn. And we now hod
that when the integrity of a fundamental right is at stake, this court will give the challenged law, administrative
order, rule or regulation a stricter scrutiny. It will not do for the authorities to invoke the presumption of
regularity in the performance of official duties. Nor is it enough for the authorities to prove that their act is not
irrational for a basic right can be diminished, if not defeated, even when the government does not act
irrationally. They must satisfactorily show the presence of compelling state interests and that the law, rule or
regulation is narrowly drawn to preclude abuses. This approach is demanded by the 1987 Constitution whose
entire matrix is designed to protect human rights and to prevent authoritarianism. In case of doubt, the least we
can do is to lean towards the stance that will not put in danger the rights protected by the Constitutions.
The case of Whalen v. Roe 79 cited by the Solicitor General is also off-line. In Whalen, the United States
Supreme Court was presented with the question of whether the State of New York could keep a centralized
computer record of the names and addresses of all persons who obtained certain drugs pursuant to a doctor's
prescription. The New York State Controlled Substance Act of 1972 required physicians to identify parties
obtaining prescription drugs enumerated in the statute, i.e., drugs with a recognized medical use but with a
potential for abuse, so that the names and addresses of the patients can be recorded in a centralized computer
file of the State Department of Health. The plaintiffs, who were patients and doctors, claimed that some people
might decline necessary medication because of their fear that the computerized data may be readily available
and open to public disclosure; and that once disclosed, it may stigmatize them as drug addicts. 80 The plaintiffs
alleged that the statute invaded a constitutionally protected zone of privacy, i.e., the individual interest in
avoiding disclosure of personal matters, and the interest in independence in making certain kinds of important
decisions. The U.S. Supreme Court held that while an individual's interest in avoiding disclosuer of personal
matter is an aspect of the right to privacy, the statute did not pose a grievous threat to establish a constitutional
violation. The Court found that the statute was necessary to aid in the enforcement of laws designed to
minimize the misuse of dangerous drugs. The patient-identification requirement was a product of an orderly and
rational legislative decision made upon recommmendation by a specially appointed commission which held
extensive hearings on the matter. Moreover, the statute was narrowly drawn and contained numerous safeguards
against indiscriminate disclosure. The statute laid down the procedure and requirements for the gathering,

storage and retrieval of the informatin. It ebumerated who were authorized to access the data. It also prohibited
public disclosure of the data by imposing penalties for its violation. In view of these safeguards, the
infringement of the patients' right to privacy was justified by a valid exercise of police power. As we discussed
above, A.O. No. 308 lacks these vital safeguards.
Even while we strike down A.O. No. 308, we spell out in neon that the Court is not per se agains the use of
computers to accumulate, store, process, retvieve and transmit data to improve our bureaucracy. Computers
work wonders to achieve the efficiency which both government and private industry seek. Many information
system in different countries make use of the computer to facilitate important social objective, such as better
law enforcement, faster delivery of public services, more efficient management of credit and insurance
programs, improvement of telecommunications and streamlining of financial activities. 81 Used wisely, data
stored in the computer could help good administration by making accurate and comprehensive information for
those who have to frame policy and make key decisions. 82 The benefits of the computer has revolutionized
information technology. It developed the internet, 83 introduced the concept of cyberspace 84 and the
information superhighway where the individual, armed only with his personal computer, may surf and search all
kinds and classes of information from libraries and databases connected to the net.
In no uncertain terms, we also underscore that the right to privacy does not bar all incursions into individual
privacy. The right is not intended to stifle scientific and technological advancements that enhance public service
and the common good. It merely requires that the law be narrowly focused 85 and a compelling interest justify
such intrusions. 86 Intrusions into the right must be accompanied by proper safeguards and well-defined
standards to prevent unconstitutional invasions. We reiterate that any law or order that invades individual
privacy will be subjected by this Court to strict scrutiny. The reason for this stance was laid down in Morfe v.
Mutuc, to wit:
The concept of limited government has always included the idea that governmental powers stop
short of certain intrusions into the personal life of the citizen. This is indeed one of the basic
disctinctions between absolute and limited government. Ultimate and pervasive control of the
individual, in all aspects of his life, is the hallmark of the absolute state. In contrast, a system of
limited government safeguards a private sector, which belongs to the individual, firmly
distinguishing it from the public sector, which the state can control. Protection of this private
sector protection, in other words, of the dignity and integrity of the individual has become
increasingly important as modern society has developed. All the forces of a technological age
industrialization, urbanization, and organization operate to narrow the area of privacy and
facilitate intrusion into it. In modern terms, the capacity to maintain and support this enclave of
private life marks the difference between a democratic and a totalitarian society. 87
IV
The right to privacy is one of the most threatened rights of man living in a mass society. The threats emanate
from various sources governments, journalists, employers, social scientists, etc. 88 In th case at bar, the threat
comes from the executive branch of government which by issuing A.O. No. 308 pressures the people to
surrender their privacy by giving information about themselves on the pretext that it will facilitate delivery of
basic services. Given the record-keeping power of the computer, only the indifferent fail to perceive the danger
that A.O. No. 308 gives the government the power to compile a devastating dossier against unsuspecting
citizens. It is timely to take note of the well-worded warning of Kalvin, Jr., "the disturbing result could be that
everyone will live burdened by an unerasable record of his past and his limitations. In a way, the threat is that
because of its record-keeping, the society will have lost its benign capacity to forget." 89 Oblivious to this
counsel, the dissents still say we should not be too quick in labelling the right to privacy as a fundamental right.
We close with the statement that the right to privacy was not engraved in our Constitution for flattery.

IN VIEW WHEREOF, the petition is granted and Adminisrative Order No. 308 entitled "Adoption of a
National Computerized Identification Reference System" declared null and void for being unconstitutional.
SO ORDERED.

Separate Opinions

ROMERO, J., separate opinion;

What marks offs man from a beast?
Aside from the distinguishing physical characteristics, man is a rational being, one who is endowed with
intellect which allows him to apply reasoned judgment to problems at hand; he has the innate spiritual faculty
which can tell, not only what is right but, as well, what is moral and ethical. Because of his sensibilities,
emotions and feelings, he likewise possesses a sense of shame. In varying degrees as dictated by diverse
cultures, he erects a wall between himself and the outside world wherein he can retreat in solitude, protecting
himself from prying eyes and ears and their extensions, whether form individuals, or much later, from
authoritarian intrusions.
Piercing through the mists of time, we find the original Man and Woman defying the injunction of God by
eating of the forbidden fruit in the Garden. And when their eyes were "opened" forthwith "they sewed fig leaves
together, and made themselves aprons." 1 Down the corridors of time, we find man fashioning "fig leaves" of
sorts or setting up figurative walls, the better to insulate themselves from the rest of humanity.
Such vague stirrings of the desire "to be left alone," considered "anti-social" by some, led to the development of
the concept of "privacy," unheard of among beasts. Different branches of science, have made their own studies
of this craving of the human spirit psychological, anthropological sociological and philosophical, with the
legal finally giving its imprimatur by elevating it to the status ofa right, specifically a private right.
Initially recognized as an aspect of tort law, it created giant waves in legal circles with the publication in the
Harvard Law Review 2 of the trail-blazing article, "The Right to Privacy," by Samuel D. Warren and Louis D.
Brandeis.
Whether viewed as a personal or a property right, it found its way in Philippine Constitutions and statutes; this,
in spite of the fact that Philippine culture can hardly be said to provide a fertile field for the burgeoning of said
right. In fact, our lexicographers have yet to coin a word for it in the Filipino language. Customs and practices,
being what they have always been, Filipinos think it perfectly natural and in good taste to inquire into each
other's intimate affairs.
One has only to sit through a televised talk show to be convinced that what passes for wholesome entertainment
is actually an invasion into one's private life, leaving the interviewee embarrassed and outraged by turns.
With the overarching influence of common law and the recent advent of the Information Age with its high-tech
devices, the right to privacy has expanded to embrace its public law aspect. The Bill of Rights of our evolving
Charters, a direct transplant from that of the United States, contains in essence facets of the right to privacy
which constitute limitations on the far-reaching powers of government.

So terrifying are the possibilities of a law such as Administrative Order No. 308 in making inroads into the
private lives of the citizens, a virtual Big Brother looking over our shoulder, that it must, without delay, be
"slain upon sight" before our society turns totalitarian with each of us, a mindless robot.
I, therefore, VOTE for the nullification of A.O. No. 308.

VITUG, J., separate opinion;

One can appreciate the concern expressed by my esteemed colleague, Mr. Justice Reynato S. Puno, echoing that
of the petitioner, the Honorable Blas F. Ople, on the issuance of Administrative Order No. 308 by the President
of the Philippines and the dangers its implementation could bring. I find it hard, nevertheless, to peremptorily
assume at this time that the administrative order will be misused and to thereby ignore the possible benefits that
can be derived from, or the merits of, a nationwide computerized identification reference system. The great
strides and swift advances in technology render it inescapable that one day we will, at all events, have to face up
with the reality of seeing extremely sophisticated methods of personal identification and any attempt to stop the
inevitable may either be short-lived or even futile. The imperatives, I believe, would instead be to now install
specific safeguards and control measures that may be calculated best to ward-off probable ill effects of any such
device. Here, it may be apropos to recall the pronouncement of this Court in People vs. Nazario 1 that
As a rule, a statute or [an] act may be said to be vague when it lacks comprehensible standards
that men "of common intelligence must necessarily guess at its meaning and differ as to its
application." It is repugnant to the Constitution in two respects: (1) it violates due process for
failure to accord persons, especially the parties targeted by it, fair notice of the conduct to avoid;
and (2) it leaves law enforcers unbridled discretion in carrying out its provisions and becomes an
arbitrary flexing of the Government muscle. 2
Administrative Order No. 308 appears to be so extensively drawn that could, indeed, allow unbridled
options to become available to its implementors beyond the reasonable comfort of the citizens and of
residents alike.
Prescinding from the foregoing, and most importantly to this instance, the subject covered by the questioned
administrative order can have far-reaching consequences that can tell on all individuals, their liberty and
privacy, that, to my mind, should make it indispensable and appropriate to have the matter specifically
addressed by the Congress of the Philippines, the policy-making body of our government, to which the task
should initially belong and to which the authority to formulate and promulgate that policy is constitutionally
lodged.
WHEREFORE, I vote for the nullification of Administrative Order No. 308 for being an undue and
impermissible exercise of legislative power by the Executive.

PANGANIBAN, J., separate opinion;

I concur only in the result and only on the ground that an executive issuance is not legally sufficient to establish
an all-encompassing computerized system of identification in the country. The subject matter contained in AO
308 is beyond the powers of the President to regulate without a legislative enactment.
I reserve judgmeht on the issue of wherher a national ID system is an infringement of the constitutional right to
privacy or the freedom of thought until after Congress passes, if ever, a law to this effect. Only then, and upon

the filing of a proper petition, may the provisions of the statute be scrutinized by the judiciary to determine their
constitutional foundation. Until such time, the issue is premature; and any decision thereon, speculative and
academic. 1
Be that as it may, the scholarly discussions of Justices Romero, Puno, Kapunan and Mendoza on the
constitutional right to privacy and freedom of thought may stil become useful guides to our lawmakers, when
and if Congress should deliberate on a bill establishing a national identification system.
Let it be noted that this Court, as shown by the voting of the justices, has not definitively ruled on these points.
The voting is decisive only on the need for the appropriate legislation, and it is only on this ground that the
petition is granted by this Court.

KAPUNAN, J., dissenting opinion;

The pioneering efforts of the executive to adopt a national computerized identification reference system has met
fierce opposition. It has spun dark predictions of sinister government ploys to tamper with the citizen's right to
privacy and ominous forecasts of a return to authoritarianism. Lost in the uproar, however, is the simple fact
that there is nothing in the whole breadth and lenght of Administrative Order No. 308 that suggests a taint
constitutional infirmity.
A.O. No. 308 issued by President Fidel V. Ramos on 12 December 1996 reads:
ADMTNISTRATIVE ORDER NO. 308
ADOPTION OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM
WHEREAS, there is a need to provide Filipino citizens and foreign residents with the facility to
conveniently transact business with basic services and social security providers and other
government instrumentalities;
WHEREAS, this will require a computerized system to properly and efficiently identify persons
seeking basic services and social security and reduce, if not totally eradicate, fraudulent
transactions and misrepresentations;
WHEREAS, a concerted and collaborative effort among the various basic services and social
security providing agencies and other government instrumentalities is required to achieve such a
system;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Repubic of the Philippines, by
virtue of the powers vested in me by law, do hereby direct the following:
Sec. 1 Establishment of a National Computerized Identification Reference System. A
decentralized Identification Reference System among the key basic services and social security
providers is hereby established.

Sec. 2. Inter-Agency Coordinating Committee. An Inter-Agency Coordinating Committee

(IACC) to draw-up the implementing guidelines and oversee the implementation of the System is
hereby created, chaired by the Executive Secretary, with the following as members:
Head Presidential Management Staff
Secretary, National Economic Development Authority
Secretary, Department of the Interior and Local Government
Secretary, Department of Health
Administrator, Government Service Insurance System
Administrator, Social Security System
Administrator, National Statistics Office
Managing Director, National Computer Center
Sec. 3. Secretariat. The National Computer Center (NCC) is hereby designated as secretariat to
the IACC and as such shall provide administrative and technical support to the IACC.
Sec. 4. Linkage Among Agencies. The Population Reference Number (PRN) generated by the
NSO shall serve as the common reference number to establish a linkage among concerned
agencies. The IACC Secretariat shall coordinate with the different Social Security and Services
Agencies to establish the standards in the use of Biometrics Technology and in computer
application designs of their respective systems.
Sec. 5. Conduct of Information Dissemination Campaign. The Office of the Press Secretary, in
coordination with the National Statistics Offices, the GSIS and SSS as lead agencies and other
concerned agencies shall undertake a massive tri-media information dissemination campaign to
educate and raise public awareness on the importance and use of the PRN and the Social Security
Identification Reference.
Sec. 6. Funding. The funds necessary for the implementation of the system shall be sourced from
the respective budgets of the concerned agencies.
Sec. 7. Submission of Regular Reports. The NSO, GSIS and SSS shall submit regular reports to
the Office of the President, through the IACC, on the status of implementation of this
undertaking.
Sec. 8 Effectivity. This Administartive Order shall take effect immediately.
DONE in the City of Manila, this 12th day of December in the year of Our Lord, Nineteen
Hundred and Ninety-Six.
In seeking to strike down A.O. No. 308 as unconstitutional, petitioner argues:
A. THE ESTABLISHMENT OF NATIONAL COMPUTERIZED IDENTIFICATION
REFERENCE SYSTEM REQUIRES A LEGISLATIVE ACT. THE ISSUACE OF A.O. NO.

308 BY THE PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES IS, THEREFORE,

AN UNCONSTITUTIONAL USURPATION OF THE LEGISLATIVE POWERS OF THE
CONGRESS OF THE REPUBLIC OF THE PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY THE PRESIDENT FOR THE
IMPLEMENTATION OF A.O. NO. 308 IS AN UNCONSTITUTIONAL USURPATION OF
THE EXCLUSIVE RIGHT OF CONGRESS TO APPROPRIATE PUBLIC FUNDS FOR
EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308 INSIDIOUSLY LAYS THE GROUNDWORK
FOR A SYSTEM WHICH WILL VIOLATE THE BILL OF RIGHTS ENSHRINED IN THE
CONSTITUTION.
The National Computerized Identification Reference system to which the NSO, GSIS and SSS are linked as
lead members of the IACC is intended to establish uniform standards for ID cards isssued by key government
agencies (like the SSS) 1 for the "efficient identification of persons." 2 Under the new system, only one reliable
and tamper-proof I.D. need be presented by the cardholder instead of several identification papers such as
passports and driver's license, 3 to able to transact with government agencies. The improved ID can be used to
facilitate public transactions such as:
1. Payment of SSS and GSIS benefits
2. Applications for driver's license, BIR TIN, passport, marriage license, death
certificate, NBI and police clearances, and business permits
3. Availment of Medicare services in hospitals
4. Availment of welfare services
5. Application for work/employment
6. Pre-requisite for Voter's ID. 4
The card may also be used for private transactions such as:
1. Opening of bank accounts
2. Encashment of checks
3. Applications for loans, credit cards, water, power, telephones, pagers, etc.
4. Purchase of stocks
5. Application for work/employment
6. Insurance claims
7. Receipt of payments, checks, letters, valuables, etc. 5
The new identification system would tremendously improve and uplift public service in our country to the
benefit of Filipino citizens and resident aliens. It would promote, facilitate and speed up legitimate transactions

with government offices as well as with private and business entities. Experience tells us of the constant delays
and inconveniences the public has to suffer in availing of basic public services and social security benefits
because of inefficient and not too reliable means of identification of the beneficiaries.
Thus, in the "Primer on the Social Security Card and Administrative Order No. 308" issued by the SSS, a lead
agency in the implementation of the said order, the following salient features are mentioned:
1. A.O. 308 merely establishes the standards for I.D. cards issued by key government agencies
such as SSS and GSIS.
2. It does not establish a national I.D. system neither does it require a national I.D. card for every
person.
3. The use of the I.D. is voluntary.
4. The I.D. is not required for delivery of any government service. Everyone has the right to
basic government services as long as he is qualified under existing laws.
5. The LD. cannot and will not in any way be used to prevent one to travel.
6. There will be no discrimination Non-holders of the improved I.D. are still entitled to the same
services but will be subjected to the usual rigid identification and verification beforehand.
I
The issue that must first be hurdled is: was the issuance of A.O. No. 308 an exercise by the President of
legislative power properly belonging to Congress?
It is not.
The Administrative Code of 1987 has unequivocally vested the President with quasi-legislative powers in the
form of executive orders, administrative orders, proclamations, memorandum orders and circulars and general
or special orders. 6 An administrative order, like the one under which the new identification system is embodied,
has its peculiar meaning under the 1987 Administrative Code:
Sec. 3. Administrative Orders. Acts of the President which relate to particular aspects of
governmental operations in pursuance of his duties as administrative head shall be promulgated
in administrative orders.
The National Computerized Identification Reference System was established pursuant to the aforaquoted
provision precisely because its principal purpose, as expressly stated in the order, is to provide the people with
"the facility to conveniently transact business" with the various government agencies providing basic services.
Being the "administrative head," it is unquestionably the responsibility of the President to find ways and means
to improve the government bureaucracy, and make it more professional, efficient and reliable, specially those
government agencies and instrumentalities which provide basic services and which the citizenry constantly
transact with, like the Government Service Insurance System (GSIS), Social Security System (SSS) and
National Statistics Office (NSO). The national computerized ID system is one such advancement. To
emphasize, the new identification reference system is created to streamline the bureaucracy, cut the red tape and
ultimately achieve administrative efficiency. The project, therefore, relates to, is an appropriate subject and falls
squarely within the ambit of the Chief Executive's administrative power under which, in order to successfully
carry out his administrative duties, he has been granted by law quasi-legislative powers, quoted above.

Understandably, strict adherence to the doctrine of separation of power spawns differences of opinion. For we
cannot divide the branches of government into water-tight compartment. Even if such is possible, it is neither
desirable nor feasible. Bernard Schwartz, in his work Administrative Law, A Casebook, thus states:
To be sure, if we think of the separation of powers as carrying out the distinction between
legislation and administration with mathematical precision and as dividing the branches of
government into watertight compartments, we would probably have to conclude that any
exercise of lawmaking authority by an agency is automatically invalid. Such a rigorous
application of the constitutional doctrine is neither desirable nor feasible; the only absolute
separation that has ever been possible was that in the theoretical writings of a Montesquieu, who
looked across at foggy England from his sunny Gascon vineyards and completely misconstrued
what he saw. 7
A mingling of powers among the three branches of government is not a novel concept. This blending of powers
has become necessary to properly address the complexities brought about by a rapidly developing society and
which the traditional branches of government have difficulty coping with. 8
It has been said that:
The true meaning of the general doctrine of the separation of powers seems to be that the whole
power of one department should not be exercised by the same hands which possess the whole
power of either of the other department, and that no one department ought to possess directly or
indirectly an overruling influence over the others. And it has been that this doctrine should be
applied only to the powers which because of their nature are assigned by the constitution itself to
one of the departments exclusively. Hence, it does not necessarily follow that an entire and
complete separation is either desirable of was ever intended, for such a complete separation
would be impracticable if not impossible; there may be-and frequently are-areas in which
executive, legislative, and judicial powers blend or overlap; and many officers whose duties
cannot be exclusively placed under any one of these heads.
The courts have perceived the necessity of avoiding a narrow construction of a state
constitutional provision for the division of the powers of the government into three distinct
departments, for it is impractical to view the provision from the standpoint of a doctrinaire. Thus,
the modern view of separation of powers rejects the metaphysical abstractions and reverts
instead to more pragmatic, flexible, functional approach, giving recognition to the fact that then
may be a certain degree of blending or admixture of the three powers of the government.
Moreover, the doctrine of separation of powers has never been strictly or rigidly applied, and
indeed could not be, to all the ramifications of state or national governments; government would
prove abortive if it were attempted to follow the policy of separation to the letter. 9
In any case A.O. No. 308 was promulgated by the President pursuant to the quasi-legislative powers expressly
granted to him by law and in accordance with his duty as administrative head. Hence, the contention that the
President usurped the legislative prerogatives of Congress has no firm basis.
II
Having resolved that the President has the authority and prerogative to issue A.O. No. 308, I submit that it is
premature for the Court to determine the constitutionality or unconstitutionality of the National Computerized
Identification Reference System.
Basic in constitutional law is the rule that before the court assumes jurisdiction over and decide constitutional
issues, the following requisites must first be satisfied:

1) there must be an actual case or controversy involving a conflict of rights susceptible of judicial
determination;
2) the constitutional question must be raised by a proper party;
3) the constitutional question must be raised at the earliest opportunity; and
4) the resolution of the constitutional question must be necessary to the resolution of the case. 10
In this case, it is evident that the first element is missing. Judicial intervention calls for an actual case or
controversy which is defined as "an existing case or controversy that is appropriate or ripe for
determination, not conjectural or anticipatory." 11 Justice Isagani A. Cruz further expounds that "(a) justifiable
controversy is thus distinguished from a difference or dispute of a hypothetical or abstract character or from one
that is academic or moot. The controversy must be definite and concrete, touching the legal relations of parties
having adverse legal interests. It must be a real and substantial controversy admitting of special relief through a
decree that is conclusive in character, as distinguished from an opinion advising what the law would be upon a
hypothetical state of facts. . . ." 12 A.O. No. 308 does not create any concrete or substantial controversy. It
provides the general framework of the National Computerized Identification Reference System and lays down
the basic standards (efficiency, convenience and prevention of fraudulent transactions) for its cretion. But as
manifestly indicated in the subject order, it is the Inter-Agency Coordinating Committee (IACC) which is
tasked to research, study and formulate the guidelines and parameters for the use of Biometrics Technology and
in computer application designs that will and define give substance to the new system. 13 This petition is, thus,
premature considering that the IACC is still in the process of doing the leg work and has yet to codify and
formalize the details of the new system.
The majority opines that the petition is ripe for adjudication even without the promulgation of the necessary
guidelines in view of the fact that respondents have begun implementation of A.O. No. 308. The SSS, in
particular, has started advertising in newspapers the invitation to bid for the production of the I.D. cards. 14
I beg to disagree. It is not the new system itself that is intended to be implemented in the invitation to bid but
only the manufacture of the I.D. cards. Biometrics Technology is not and cannot be used in the I.D. cards as no
guidelines therefor have yet been laid down by the IACC. Before the assailed system can be set up, it is
imperative that the guidelines be issued first.
III
Without the essential guidelines, the principal contention for invalidating the new identification reference
system that it is an impermissible encroachment on the constitutionally recognized right to privacy is
plainly groundless. There is nothing in A.O. No. 308 to serve as sufficient basis for a conclusion that the new
system to be evolved violates the right to privacy. Said order simply provides the system's general framework.
Without the concomitant guidelines, which would spell out in detail how this new identification system would
work, the perceived violation of the right to privacy amounts to nothing more than mere surmise and
speculation.
What has caused much of the hysteria over the National Computerized Identification Reference System is the
possible utilization of Biometrics Technology which refers to the use of autnomated matching of physiological
or behavioral characteristics to identify a person that would violated the citizen's constitutionally protected right
to privacy.
The majority opinion has enumerated various forms and methods of Biometrics Technology which if adopted in
the National Computaized Identification Reference System would seriously threaten the right to privacy.

Among which are biocrypt retinal scan, artificial nose and thermogram. The majority also points to certain
alleged deficiencies of A O. No. 308. Thus:
1) A.O. No. 308 does not specify the particular Biometrics Technology that shall be used for the
new identification system.
2) The order dots not state whether encoding of data is limited to biological information alone for
identification purposes;
3) There is no provision as to who shall control and access the data, under what circumstances
and for what purpose; and
4) There are no controls to guard against leakage of information, thus heightening the potential
for misuse and abuse.
We should not be overwhelmed by the mere mention of the Biometrics Technology and its alleged, yet
unfounded "far-reaching effects."
There is nothing in A.O. No. 308, as it is worded, to suggest that the advanced methods of the Biometrics
Technology that may pose danger to the right of privacy will be adopted.
The standards set in A.O. No. 308 for the adoption of the new system are clear-cut and unequivocably spelled
out in the "WHEREASES" and body of the order, namely, the need to provide citizens and foreign residents
with the facility to conveniently transact business with basic service and social security providers and other
government instrumentalities; the computerized system is intended to properly and efficiently identify persons
seeking basic services or social security and reduce, if not totally eradicate fraudulent transactions and
misreprentation; the national identification reference system is established among the key basic services and
social security providers; and finally, the IACC Secretariat shall coordinate with different Social Security and
Services Agencies to establish the standards in the use of Biometrics Technology. Consequently, the choice of
the particular form and extent of Biometrics Technology that will be applied and the parameters for its use (as
will be defined in the guidelines) will necessarily and logically be guided, limited and circumscribed by the
afore-stated standards. The fear entertained by the majority on the potential dangers of this new technology is
thus securedly allayed by the specific limitations set by the above-mentioned standards. More than this, the right
to privacy is well-esconced in and directly protected by various provisions of the Bill of Rights, the Civil Code,
the Revised Penal Code, and certain laws, all so painstakingly and resourcefully catalogued in the majority
opinion. Many of these laws provide penalties for their violation in the form of imprisonment, fines, or
damages. These laws will serve as powerful deterrents not only in the establishment of any administrative rule
that will violate the constitutionally protected right to privacy, but also to would-be transgressors of such right.
Relevant to this case is the ruling of the U.S. Supreme Court in Whalen v. Roe. 15 In that case, a New York
statute was challenged for requiring physicians to identify patients obtaining prescription drugs of the statute's
"Schedule II" category (a class of drugs having a potential for abuse and a recognized medical use) so the names
and addresses of the prescription drug patients can be recorded in a centralized computer file maintained by the
New York State Department of Health. Some patients regularly receiving prescription for "Schedule II" drugs
and doctors who prescribed such drugs brought an action questioning the validity of the statute on the ground
that it violated the plaintiffs' constitutionally protected rights of privacy.
In a unanimous decision, the US Supreme Court sustained the validity of the statute on the ground that the
patient identification requirement is a reasonable exercise of the State's broad police powers. The Court also
held that there is no support in the record for an assumption that the security provisions of the statute will be
adiministered improperly. Finally, the Court opined that the remote possibility that judicial supervision of the

evidentiary use of particular items of stored information will not provide adequate protection against
unwarranted diclosures is not a sufficient reason for invalidating the patient-identification program.
To be sure, there is always a possibility of an unwarranted disclosure of confidential matters enomously
accumulated in computerized data banks and in government records relating to taxes, public health, social
security benefits, military affairs, and similar matters. But as previously pointed out, we have a sufficient
number of laws prohibiting and punishing any such unwarranted disclosures. Anent this matter, the observation
in Whalen vs. Roeis instructive:
. . . We are not unaware of the threat to privacy implicit in the accumulation of vast amounts of
personal information in computerized data banks or other massive government files. The
collection of taxes, the distribution of welfare and social security benefits, the supervision of
public health, the direction of our Armed Forces and the enforcement of the criminal laws all
require the orderly preservation of great quantities of information, much of which is personal in
character and potentially embarrassing or harmful if disclosed. The right to collect and use such
data for public purposes is typically accompanied by a concomitant statutory or regulatory duty
to avoid unwarranted disclosures. . . . 16
The majority laments that as technology advances, the level of reasonably expected privacy decreases. That
may be true. However, court should tread daintily on the field of social and economic experimentation lest they
impede or obstruct the march of technology to improve public services just on the basis of an unfounded fear
that the experimentation violates one's constitutionally protected rights. In the sobering words of Mr. Justice
Brandeis:
To stay experimentation in things social and economic is a grave responsibility. Denial of the
right to experiment may be fraught with serious consequences to the Nation. It is one of the
happy incidents of the federal system that a single courageous State may, if its citizens choose,
serve as a laboratory; and try novel social and economic experiments without risk to the rest of
the country. This Court has the power to prevent an experiment. We may strike down the statute
which embodies it on the ground that, in our opinion, the measure is arbitary, capricious or
unreaonable. We have power to do this, because the due process clause has been held by he
Court applicable to matters of substantive law as well as to matters of procedure. But in the
exercise of this high power, we must be ever on our guard, lest we erect our prejudices into legal
principles. If we would guide by the light of reason, we must let our minds be bold. 17
Again, the concerns of the majority are premature precisely because there are as yet no guidelines that will
direct the Court and serve as solid basis for determining the constitutionality of the new identification system.
The Court cannot and should not anticipate the constitutional issues and rule on the basis of guesswok. The
guidelines would, among others, determine the particular biometrics method that would be used and the specific
personal data that would be collected provide the safeguard, (if any) and supply the details on how this new
system in supposed to work. The Court should not jump the gun on the Executive.
III
On the issue of funding, the majority submits that Section 6 of A.O. No. 308, which allows the government
agencies included in the new system to obtain funding form their respective budgets, is unconstitutional for
being an illegal transfer of appropriations.
It is not so. The budget for the national identification system cannot be deemed a transfer of funds since the
same is composed of and will be implemented by the member government agancies. Morever, thses agencies
particularly the GSIS and SSS have been issuing some form of identification or membership card. The
improved ID cards that will be issued under this new system would just take place of the old identification cards

and budget-wise, the funds that were being used to manufacture the old ID cards, which are usually accounted
for under the "Supplies and Materials" item of the Government Accounting and Auditing Manual, could now be
utilized to fund the new cards. Hence, what is envisioned is not transfer of appropriations but a pooling of funds
and resources by the various government agencies involved in the project.
WHEREFORE, I vote to dismiss the petition.

MENDOZA, J., separate opinion;

My vote is to dismiss the petition in this case.
First. I cannot find anything in the text of Administrative Order No. 308 of the President of the Philippines that
would warrant a declaration that it is violative of the right of privacy. So far as I can see, all the Administrative
Orders does is
establish an Identification Reference System involving the following service agencies of
the government:
Presidential Management Staff
National Economic Developemnt Authority
Department of the Interior and Local Government
Department of Health
Government Service Isurance System
Social Security Office
National Computer Center
create a committee, composed of the heads of the agencies concerned, to draft rules for
the System;
direct the use of the Population Reference Number (PRN) generated by the National
Census and Statistics Office as the common reference number to link the participating
agencies into an Identification Reference System, and the adoption by the agencies of
standards in the use of biometrics technology and computer designs; and
provide for the funding of the System from the budgets of the agencies concerned.
Petitioner argues, however, that "the implementation of A.O. No. 308 will mean that each and every Filipino
and resident will have a file with the government containing, at the very least, his PRN and physiological
biometrics such as, but not limited to, his facial features, hand geometry, retinal or iris pattern, DNA pattern,
fingerprints, voice characteristics, and signature analysis."
In support of his contention, petitioner quotes the following publication surfed from the Internet:

The use of biometrics is the means by which an individual may be conclusively identified. There
are two types of biometrics identifiers; Physical and behavioral characteristics, Physiological
biometrics include facial features, hand geometry, retinal and iris patterns. DNA, and
fingerprints characteristics include voice characteristics and signature analysis. 1
I do not see how from the bare provisions of the Order, the full text of which is set forth in the majority opinion,
petitioner and the majority can conclude that the Identification Reference System establishes such
comprehensive personal information dossiers that can destroy individual privacy. So far as the Order provides,
all that is contemplated is an identification system based on data which the government agencies involved have
already been requiring individuals making use of their services to give.
For example, under C.A. No. 591, 2(a) the National Statistics Office collects "by enumeration, sampling or
other methods, statistics and other information concerning population . . . social and economic institutions, and
such other statistics as the President may direct." In addition, it is in charge of the administration of the Civil
Register, 2which means that it keeps records of information concerning the civil status of persons, i.e., (a) births,
(b) deaths, (c) marriages and their annulments; (d) legitimations, (e) adoptions, (f) acknowledgments of natural
children, (g) naturalizations, and (h) changes of name. 3
Other statutes giving government agencies the power to require personal information may be cited. R.A. No.
4136, 23 gives the Land Transportation Office the power to require applicants for a driver's license to give
information regarding the following: their full names, date of birth, height, weight, sex, color of eyes, blood
type, address, and right thumbprint; 4 while R.A. No. 8239, 5 gives the Department of Foreign Affairs the
power to require passport applicants to give information concerning their names, place of birth, date of birth,
religious affiliation, marital status, and citizenship.
Justice Romero, tracing the origin of privacy to the attempt of the first man and woman to cover their nakedness
with fig leaves, bemoans the fact that technology and institutional pressures have threatened our sense of
privacy. On the other hand, the majority would have none of the Identification Reference System "to prevent the
shrinking of the right to privacy, once regarded as "the most comprehensive of rights and the right most valued
by civilized men."" 5 Indeed, techniques such as fingerprinting or electronic photography in banks have become
commonplace. As has been observed, the teaching hospital has come to be accepted as offering madical services
that compensate for the loss of the isolation of the sickbed; the increased capacity of applied sciences to utilize
more and more kinds of data and the cosequent calls for such data have weakened traditional resistance to
disclosure. As the area of relevance, political or scientific, expands, there is strong psychological pressure to
yield some ground of privacy. 6
But this is a fact of life to which we must adjust, as long as the intrusion into the domain of privacy is
reasonable. InMorfe v. Mutuc, 7 this Court dealt the coup de grace to claims of latitudinarian scope for the right
of privacy by quoting the pungent remark of an acute observer of the social scene, Carmen Guerrero-Nakpil:
Privacy? What's that? There is no precise word for it in Filipino, and as far as I know any
Filipino dialect and there is none because there is no need for it. The concept and practice of
privacy are missing from conventional Filipino life. The Filipino believes that privacy is an
unnecessary imposition, an eccentricity that is barely pardonable or, at best, an esoteric Western
afterthought smacking of legal trickery. 8
Justice Romero herself says in her separate opinion that the word privacy is not even in the lexicon of
Filipinos.
As to whether the right of privacy is "the most valued right," we do well to remember the encomiums paid as
well to other constitutional rights. For Professor Zechariah Chafee, "The writ of habeas corpus is "the most

important human rights provision in the fundamental law,"" 9 For Justice Cardozo, on the other hand, freedom
of expression "is the matrix, the indispensable condition of nearly every other form of freedom." 10
The point is that care must be taken in assigning values to constitutional rights for the purpose of calibrating
them on the judicial scale, especially if this means employing stricter standards of review for regulations alleged
to infringe certain rights deemed to be "most valued by civilized men.''
Indeed, the majority concedes that "the right of privacy does not bar all incursions into individual privacy . . .
[only that such] incursions into the right must be accompanied by proper safeguards and well-defined standards
to prevent unconstitutional invasions." 11 In the case of the Identification Reference System, the purpose is to
facilitate the transaction of business with service agencies of the government and to prevent fraud and
misrepresentation. The personal identification of an individual can facilitate his treatment in any government
hospital in case of emergency. On the other hand, the delivery of material assistance, such as free medicines,
can be protected from fraud or misrepresentation as the absence of a data base makes it possible for
unscrupulous individuals to obtain assistance from more than one government agency.
Second. Thus, the issue in this case is not really whether A.O. No. 308 violates the right of privacy formed by
emanations from the several constitutional rights cited by the majority. 12 The question is whether it violates
freedom of thought and of conscience guaranteed in the following provisions of our Bill of Rights (Art. III):
Sec. 4. No law Shall be passed abridging the freedom of speech, of expression, or of the press, or
the right of the people peaceably to assemble and petition the government for redress of
grievances.
Sec. 5. No law shall be made respecting an establishment of religion, or prohibiting the free
exercise thereof. The free exercise enjoyment of religious profession and worship, without
discrimination or preference, shall be forever be allowed. No religious test shall be required for
the exercise of civil or political rights.
More specifically, the question is whether the establishment of the Identification Reference System will not
result in the compilation of massive dossiers on individuals which, beyond their use for identification, can
become instruments of thought control. So far, the next of A.O. No. 308 affords no basis for believing that the
data gathered can be used for such sinister purpose. As already stated, nothing that is not already being required
by the concerned agencies of those making use of their servides is required by the Order in question. The Order
simply organizes service agencies of the government into a System for the purpose of facilitating the
identification of persons seeking basic services and social security. Thus, the whereas clauses of A.O. No. 308
state:
WHEREAS, there is a need to provide Filipino citizens and foreign residents with the facility to
conveniently transact business with basic services and social security providers and other
government instrumentalities;
WHEREAS, this will require a computerized system to properly and efficiently identify persons
seeking basic services and social security, and reduce, if not totally eradicate, fraudulent
transactions and misrepresentations;
WHEREAS, a concerted and collaborative effort among the various basic services and social
security providing agencies and other government instrumentalities is required to achieve such a
system:
The application of biometric technology and the standardization of computer designs can provide
service agencies with precise identification of individuals, but what is wrong with that?

Indeed, A.O. No. 308 is no more than a directive to government agencies which the President of the Philippines
has issued in his capacity as administrative head. 13 It is not a statute. It confers no right; it imposes no duty; it
affords no protection; it creates no office. 14 It is, as its name indicates, a mere administrative order, the prescise
nature of which is given in the following excerpt from the decision in the early case of Olsen & Co. v.
Herstein: 15
[It] is nothing more or less than a command from a superior to an inferior. It creates no relation
except between the official who issues it and the official who receives it. Such orders, whether
executive or departmental, have for their object simply the efficient and economical
administration of the affairs of the department to which or in which they are issued in accordance
with the law governing the subject-matter. They are administrative in their nature and do not pass
beyond the limits of the department to which they are directed or in which they are published,
and, therefore, create no rights in third persons. They are based on, and are the product of a
relationship in which power is their source and obedience their object. Disobedience to or
deviation from such an order can be punished only by the power which issued it: and, if that
power fails to administer the corrective, then the disobedience goes unpunished. In that
relationship no third person or official may intervene, not even the court. Such orders may be
very temporary, they being subject to instant revocation or modification by the power which
published them. Their very nature, as determined by the relationship which prodecued them,
demonstrates clearly the impossibility of any other person enforcing them except the one who
created them. An attempt on the part of the courts to enforce such orders would result not only in
confusion but, substantially, in departmental anarchy also. 16
Third. There is no basis for believing that, beyond the identification of individuals, the System will be used for
illegal purposes. Nor are sanctions lacking for the unauthorized use or disclosure of information gathered by the
various agencies constituting the System. For example, as the Solicitor General points out. C.A. No. 591. 4
penalizes the unauthorized use or disclosure of data furnished the NSO with a fine of not more than P600.00 or
imprisonment for not more than six months or both.
At all events, at this stage, it is premature to pass on the claim that the Identification Reference System can be
used for the purpose of compiling massive dossiers on individuals that can be used to curtail basic civil and
political rights since, if at all, this can only be provided in the implementing rules and regulations which have
yet to be promulgated. We have already stated that A.O. No. 308 is not a statute. Even in the case of statutes,
however, where implementing rules are necessary to put them into effect, it has been held that an attack on their
constitutionality would be premature. 17 As Edgar in King Lear puts it, "Ripeness is all." 18 For, to borrow some
more Shakespearean lines,
The canker galls the infants of the spring
Too oft before their buttons be disclos'd. 19
That, more than any doctrine of constitutional law I can think of, succinctly expresses the rule on
ripeness, prematurity, and hypothetical, speculative, or conjectural claims.
Of special relevance to this case is Laird v. Tatum. 20 There, a class suit was brought seeking declaratory and
injunctive relief on the claim that a U.S. Army intelligence surveillance of civilian political activity having "a
potential for civil disorder" exercised "a present inhibiting effect on [respondents'] full expression and
utilization of their First Amendment rights." In holding the case nonjusticiable, the U.S. Supreme Court, in an
opinion by Chief Justice Burger. said: 21
In recent years this Court has found in a number of cases that constitutional violations may arise
from the deterrent or ''chilling," effect of governmental regulations that fall short of a direct

prohibition against the exercise of First Amendment rights. [Citation of cases omitted] In none of
these cases, however, did the chilling effect arise merely from the individual's knowledge that a
governmental agency was engaged in certain activities or from the individual's concomitant fear
that, armed with the fruits of those activities, the agency might in the future take some other and
additional action detrimental to that individual. Rather, in each of these cases, the challenged
exercise of governmental power was regulatory, proscriptive, or compulsory in nature, and the
complainant was either presently or prospectively subject to the regulations, proscriptions, or
compulsions that he was challenging. . . .
[T]hese decisions have in no way eroded the "established principle that to entitle a private
individual to invoke the judicial power to determine the validity of executive or legislative action
he must show that he was sustained or is immediately in danger of sustaining a direct injury as
the result of that action. . . .
The respondents do not meet this test; [the] alleged "chilling" effect may perhaps be seen as
arising from respondents' perception of the system as inappropriate to the Army's role under our
form of government, or as arising from respondents' beliefs that it is inherently dangerous for the
military to be concerned with activities in the civilian sector, or as arising from respondents' less
generalized yet speculative apprehensiveness that the Army may at some future date misuse the
information in some way that would cause direct harm to respondents. Allegations of a
subjective "chill" are not an adequate substitute for a claim of specific present objective harm or
a threat of specific future harm: "the federal courts established pursuant to Article III of the
Constitution do not render advisory opinions." United Public Workers v. Mitchell, 330 US 75,
89, 91 L Ed 754, 766, 67 S Ct 556 (1947).
Fourth. Given the fact that no right of privacy is involved in this case and that any objection to the identification
Reference System on the ground that it violates freedom of thought is premature, speculative, or conjectural
pending the issuance of the implementing rules, it is clear that petitioner Blas F. Ople has no cause of action
and, therefore, no standing to bring this action. Indeed, although he assails A.O. No. 308 on the ground that it
violates the right of privacy, he claims no personal injury suffered as a result of the Order in question. Instead,
he says he is bringing this action as taxpayer, Senator, and member of the Government Service Insurance
System.
Insofar as petitioner claims an interest as taxpayer, it is sufficient to say that A.O. No. 308 does not involve the
exercise of the taxing or spending power of the government.
Insofar as he purports to sue as a member of the GSIS, neither does petitioner have an intertest sufficient to
enable him to litigate a constitutional question. Petitioner claims that in providing that the funds necessary for
implementing the System shall be taken from the budgets of the concerned agencies. A.O. No. 308 violates Art.
VI, 25(5) which. provides:
No law shall be passed authorizing any transfer of appropriations; however, the President, the
President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional Commissions may, by law, be authorized to
augment any item in the general appropriations law for their respective offices from savings in
other items of their respective appropriations.
But, as the Solicitor General states:
Petitioner's argument is anchored on two erroneous assumptions: one, that all the concerned
agencies, including the SSS and the GSIS, receive budgetary support from the national

government; and two, that the GAA is the only law whereby public funds are appropriated. Both
assumptions are wrong.
The SSS and GSIS do not presently receive budgetary support from the National Government.
They have achieved self-supporting status such that the contributions of their members are
sufficient to finance their expenses. One would be hard pressed to find in the GAA an
appropriation of funds to the SSS and the GSIS.
Furthermore, their respective charters authorize the SSS and the GSIS to disburse their funds
(Rep. Act No. 1161 [1954], as amended, Sec. 25; Pres. Decree No. 1146 [1977], as amended,
Sec. 29) without the need for a separate appropriation from the Congress.
Nor as Senator can petitioner claim standing since no power of Congress is alleged to have been impaired by
the Administrative Order in question. 22 As already stated, in issuing A.O. No. 308, the President did not
exercise the legislative power vested by the Constitution in Congress. He acted on the basis of his own powers
as administrative head of the government, as distinguished from his capacity as the Executive. Dean Sinco
elucidates the crucial distinction thus:
The Constitution of the Philippines makes the President not only the executive but also the
administrative head of the government. . . . Executive power refers to the legal and political
function of the President involving the exercise of discretion. Administrative power, on the other
hand, concerns itself with the work of applying policies and enforcing orders as determined by
proper governmental organs. These two functions are often confused by the public: but they are
distinct from each other. The President as the executive authority has the duty of supervising the
enforcement of laws for the maintenance of general peace and public order. As administrative
head, his duty is to see that every government office is managed and maintained properly by the
persons in charge of it in accordance with pertinent laws and regulations.
. . . The power of control vested in him by the Constitution makes for a strongly centralized
administrative system. It reinforces further his position as the executive of the government,
enabling him to comply more effectively with his constitutional duty to enforce the laws. It
enables him to fix a uniform standard of a administrative eficiency and to check the official
conduct of his agents. The decisions of all the officers within his department are subject to his
power of revision, either on his own motion or on the appeal of some individual who might deem
himself aggrieved by the action of an administrative official. In case of serious dereliction of
duty, he may suspend or remove the officials concerned. 23
For the foregoing reasons, the petition should be DISMISSED.

# Separate Opinions
ROMERO, J., separate opinion;
What marks offs man from a beast?
Aside from the distinguishing physical characteristics, man is a rational being, one who is endowed with
intellect which allows him to apply reasoned judgment to problems at hand; he has the innate spiritual faculty
which can tell, not only what is right but, as well, what is moral and ethical. Because of his sensibilities,
emotions and feelings, he likewise possesses a sense of shame. In varying degrees as dictated by diverse
cultures, he erects a wall between himself and the outside world wherein he can retreat in solitude, protecting

himself from prying eyes and ears and their extensions, whether form individuals, or much later, from
authoritarian intrusions.
Piercing through the mists of time, we find the original Man and Woman defying the injunction of God by
eating of the forbidden fruit in the Garden. And when their eyes were "opened" forthwith "they sewed fig leaves
together, and made themselves aprons." 1 Down the corridors of time, we find man fashioning "fig leaves" of
sorts or setting up figurative walls, the better to insulate themselves from the rest of humanity.
Such vague stirrings of the desire "to be left alone," considered "anti-social" by some, led to the development of
the concept of "privacy," unheard of among beasts. Different branches of science, have made their own studies
of this craving of the human spirit psychological, anthropological sociological and philosophical, with the
legal finally giving its imprimatur by elevating it to the status ofa right, specifically a private right.
Initially recognized as an aspect of tort law, it created giant waves in legal circles with the publication in the
Harvard Law Review 2 of the trail-blazing article, "The Right to Privacy," by Samuel D. Warren and Louis D.
Brandeis.
Whether viewed as a personal or a property right, it found its way in Philippine Constitutions and statutes; this,
in spite of the fact that Philippine culture can hardly be said to provide a fertile field for the burgeoning of said
right. In fact, our lexicographers have yet to coin a word for it in the Filipino language. Customs and practices,
being what they have always been, Filipinos think it perfectly natural and in good taste to inquire into each
other's intimate affairs.
One has only to sit through a televised talk show to be convinced that what passes for wholesome entertainment
is actually an invasion into one's private life, leaving the interviewee embarrassed and outraged by turns.
With the overarching influence of common law and the recent advent of the Information Age with its high-tech
devices, the right to privacy has expanded to embrace its public law aspect. The Bill of Rights of our evolving
Charters, a direct transplant from that of the United States, contains in essence facets of the right to privacy
which constitute limitations on the far-reaching powers of government.
So terrifying are the possibilities of a law such as Administrative Order No. 308 in making inroads into the
private lives of the citizens, a virtual Big Brother looking over our shoulder, that it must, without delay, be
"slain upon sight" before our society turns totalitarian with each of us, a mindless robot.
I, therefore, VOTE for the nullification of A.O. No. 308.

VITUG, J., separate opinion;

One can appreciate the concern expressed by my esteemed colleague, Mr. Justice Reynato S. Puno, echoing that
of the petitioner, the Honorable Blas F. Ople, on the issuance of Administrative Order No. 308 by the President
of the Philippines and the dangers its implementation could bring. I find it hard, nevertheless, to peremptorily
assume at this time that the administrative order will be misused and to thereby ignore the possible benefits that
can be derived from, or the merits of, a nationwide computerized identification reference system. The great
strides and swift advances in technology render it inescapable that one day we will, at all events, have to face up
with the reality of seeing extremely sophisticated methods of personal identification and any attempt to stop the
inevitable may either be short-lived or even futile. The imperatives, I believe, would instead be to now install
specific safeguards and control measures that may be calculated best to ward-off probable ill effects of any such
device. Here, it may be apropos to recall the pronouncement of this Court in People vs. Nazario 1 that

As a rule, a statute or [an] act may be said to be vague when it lacks comprehensible standards
that men "of common intelligence must necessarily guess at its meaning and differ as to its
application." It is repugnant to the Constitution in two respects: (1) it violates due process for
failure to accord persons, especially the parties targeted by it, fair notice of the conduct to avoid;
and (2) it leaves law enforcers unbridled discretion in carrying out its provisions and becomes an
arbitrary flexing of the Government muscle. 2
Administrative Order No. 308 appears to be so extensively drawn that could, indeed, allow unbridled
options to become available to its implementors beyond the reasonable comfort of the citizens and of
residents alike.
Prescinding from the foregoing, and most importantly to this instance, the subject covered by the questioned
administrative order can have far-reaching consequences that can tell on all individuals, their liberty and
privacy, that, to my mind, should make it indispensable and appropriate to have the matter specifically
addressed by the Congress of the Philippines, the policy-making body of our government, to which the task
should initially belong and to which the authority to formulate and promulgate that policy is constitutionally
lodged.
WHEREFORE, I vote for the nullification of Administrative Order No. 308 for being an undue and
impermissible exercise of legislative power by the Executive.

PANGANIBAN, J., separate opinion;

I concur only in the result and only on the ground that an executive issuance is not legally sufficient to establish
an all-encompassing computerized system of identification in the country. The subject matter contained in AO
308 is beyond the powers of the President to regulate without a legislative enactment.
I reserve judgmeht on the issue of wherher a national ID system is an infringement of the constitutional right to
privacy or the freedom of thought until after Congress passes, if ever, a law to this effect. Only then, and upon
the filing of a proper petition, may the provisions of the statute be scrutinized by the judiciary to determine their
constitutional foundation. Until such time, the issue is premature; and any decision thereon, speculative and
academic. 1
Be that as it may, the scholarly discussions of Justices Romero, Puno, Kapunan and Mendoza on the
constitutional right to privacy and freedom of thought may stil become useful guides to our lawmakers, when
and if Congress should deliberate on a bill establishing a national identification system.
Let it be noted that this Court, as shown by the voting of the justices, has not definitively ruled on these points.
The voting is decisive only on the need for the appropriate legislation, and it is only on this ground that the
petition is granted by this Court.

KAPUNAN, J., dissenting opinion;

The pioneering efforts of the executive to adopt a national computerized identification reference system has met
fierce opposition. It has spun dark predictions of sinister government ploys to tamper with the citizen's right to
privacy and ominous forecasts of a return to authoritarianism. Lost in the uproar, however, is the simple fact
that there is nothing in the whole breadth and lenght of Administrative Order No. 308 that suggests a taint
constitutional infirmity.

A.O. No. 308 issued by President Fidel V. Ramos on 12 December 1996 reads:
ADMTNISTRATIVE ORDER NO. 308
ADOPTION OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM
WHEREAS, there is a need to provide Filipino citizens and foreign residents with the facility to
conveniently transact business with basic services and social security providers and other
government instrumentalities;
WHEREAS, this will require a computerized system to properly and efficiently identify persons
seeking basic services and social security and reduce, if not totally eradicate, fraudulent
transactions and misrepresentations;
WHEREAS, a concerted and collaborative effort among the various basic services and social
security providing agencies and other government instrumentalities is required to achieve such a
system;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Repubic of the Philippines, by
virtue of the powers vested in me by law, do hereby direct the following:
Sec. 1 Establishment of a National Computerized Identification Reference System. A
decentralized Identification Reference System among the key basic services and social security
providers is hereby established.
Sec. 2. Inter-Agency Coordinating Committee. An Inter-Agency Coordinating Committee
(IACC) to draw-up the implementing guidelines and oversee the implementation of the System is
hereby created, chaired by the Executive Secretary, with the following as members:
Head Presidential Management Staff
Secretary, National Economic Development Authority
Secretary, Department of the Interior and Local Government
Secretary, Department of Health
Administrator, Government Service Insurance System
Administrator, Social Security System
Administrator, National Statistics Office
Managing Director, National Computer Center
Sec. 3. Secretariat. The National Computer Center (NCC) is hereby designated as secretariat to
the IACC and as such shall provide administrative and technical support to the IACC.

Sec. 4. Linkage Among Agencies. The Population Reference Number (PRN) generated by the
NSO shall serve as the common reference number to establish a linkage among concerned
agencies. The IACC Secretariat shall coordinate with the different Social Security and Services
Agencies to establish the standards in the use of Biometrics Technology and in computer
application designs of their respective systems.
Sec. 5. Conduct of Information Dissemination Campaign. The Office of the Press Secretary, in
coordination with the National Statistics Offices, the GSIS and SSS as lead agencies and other
concerned agencies shall undertake a massive tri-media information dissemination campaign to
educate and raise public awareness on the importance and use of the PRN and the Social Security
Identification Reference.
Sec. 6. Funding. The funds necessary for the implementation of the system shall be sourced from
the respective budgets of the concerned agencies.
Sec. 7. Submission of Regular Reports. The NSO, GSIS and SSS shall submit regular reports to
the Office of the President, through the IACC, on the status of implementation of this
undertaking.
Sec. 8 Effectivity. This Administartive Order shall take effect immediately.
DONE in the City of Manila, this 12th day of December in the year of Our Lord, Nineteen
Hundred and Ninety-Six.
In seeking to strike down A.O. No. 308 as unconstitutional, petitioner argues:
A. THE ESTABLISHMENT OF NATIONAL COMPUTERIZED IDENTIFICATION
REFERENCE SYSTEM REQUIRES A LEGISLATIVE ACT. THE ISSUACE OF A.O. NO.
308 BY THE PRESIDENT OF THE REPUBLIC OF THE PHILIPPINES IS, THEREFORE,
AN UNCONSTITUTIONAL USURPATION OF THE LEGISLATIVE POWERS OF THE
CONGRESS OF THE REPUBLIC OF THE PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY THE PRESIDENT FOR THE
IMPLEMENTATION OF A.O. NO. 308 IS AN UNCONSTITUTIONAL USURPATION OF
THE EXCLUSIVE RIGHT OF CONGRESS TO APPROPRIATE PUBLIC FUNDS FOR
EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308 INSIDIOUSLY LAYS THE GROUNDWORK
FOR A SYSTEM WHICH WILL VIOLATE THE BILL OF RIGHTS ENSHRINED IN THE
CONSTITUTION.
The National Computerized Identification Reference system to which the NSO, GSIS and SSS are linked as
lead members of the IACC is intended to establish uniform standards for ID cards isssued by key government
agencies (like the SSS) 1 for the "efficient identification of persons." 2 Under the new system, only one reliable
and tamper-proof I.D. need be presented by the cardholder instead of several identification papers such as
passports and driver's license, 3 to able to transact with government agencies. The improved ID can be used to
facilitate public transactions such as:
1. Payment of SSS and GSIS benefits
2. Applications for driver's license, BIR TIN, passport, marriage license, death
certificate, NBI and police clearances, and business permits

3. Availment of Medicare services in hospitals

4. Availment of welfare services
5. Application for work/employment
6. Pre-requisite for Voter's ID. 4
The card may also be used for private transactions such as:
1. Opening of bank accounts
2. Encashment of checks
3. Applications for loans, credit cards, water, power, telephones, pagers, etc.
4. Purchase of stocks
5. Application for work/employment
6. Insurance claims
7. Receipt of payments, checks, letters, valuables, etc. 5
The new identification system would tremendously improve and uplift public service in our country to the
benefit of Filipino citizens and resident aliens. It would promote, facilitate and speed up legitimate transactions
with government offices as well as with private and business entities. Experience tells us of the constant delays
and inconveniences the public has to suffer in availing of basic public services and social security benefits
because of inefficient and not too reliable means of identification of the beneficiaries.
Thus, in the "Primer on the Social Security Card and Administrative Order No. 308" issued by the SSS, a lead
agency in the implementation of the said order, the following salient features are mentioned:
1. A.O. 308 merely establishes the standards for I.D. cards issued by key government agencies
such as SSS and GSIS.
2. It does not establish a national I.D. system neither does it require a national I.D. card for every
person.
3. The use of the I.D. is voluntary.
4. The I.D. is not required for delivery of any government service. Everyone has the right to
basic government services as long as he is qualified under existing laws.
5. The LD. cannot and will not in any way be used to prevent one to travel.
6. There will be no discrimination Non-holders of the improved I.D. are still entitled to the same
services but will be subjected to the usual rigid identification and verification beforehand.
I

The issue that must first be hurdled is: was the issuance of A.O. No. 308 an exercise by the President of
legislative power properly belonging to Congress?
It is not.
The Administrative Code of 1987 has unequivocally vested the President with quasi-legislative powers in the
form of executive orders, administrative orders, proclamations, memorandum orders and circulars and general
or special orders. 6 An administrative order, like the one under which the new identification system is embodied,
has its peculiar meaning under the 1987 Administrative Code:
Sec. 3. Administrative Orders. Acts of the President which relate to particular aspects of
governmental operations in pursuance of his duties as administrative head shall be promulgated
in administrative orders.
The National Computerized Identification Reference System was established pursuant to the aforaquoted
provision precisely because its principal purpose, as expressly stated in the order, is to provide the people with
"the facility to conveniently transact business" with the various government agencies providing basic services.
Being the "administrative head," it is unquestionably the responsibility of the President to find ways and means
to improve the government bureaucracy, and make it more professional, efficient and reliable, specially those
government agencies and instrumentalities which provide basic services and which the citizenry constantly
transact with, like the Government Service Insurance System (GSIS), Social Security System (SSS) and
National Statistics Office (NSO). The national computerized ID system is one such advancement. To
emphasize, the new identification reference system is created to streamline the bureaucracy, cut the red tape and
ultimately achieve administrative efficiency. The project, therefore, relates to, is an appropriate subject and falls
squarely within the ambit of the Chief Executive's administrative power under which, in order to successfully
carry out his administrative duties, he has been granted by law quasi-legislative powers, quoted above.
Understandably, strict adherence to the doctrine of separation of power spawns differences of opinion. For we
cannot divide the branches of government into water-tight compartment. Even if such is possible, it is neither
desirable nor feasible. Bernard Schwartz, in his work Administrative Law, A Casebook, thus states:
To be sure, if we think of the separation of powers as carrying out the distinction between
legislation and administration with mathematical precision and as dividing the branches of
government into watertight compartments, we would probably have to conclude that any
exercise of lawmaking authority by an agency is automatically invalid. Such a rigorous
application of the constitutional doctrine is neither desirable nor feasible; the only absolute
separation that has ever been possible was that in the theoretical writings of a Montesquieu, who
looked across at foggy England from his sunny Gascon vineyards and completely misconstrued
what he saw. 7
A mingling of powers among the three branches of government is not a novel concept. This blending of powers
has become necessary to properly address the complexities brought about by a rapidly developing society and
which the traditional branches of government have difficulty coping with. 8
It has been said that:
The true meaning of the general doctrine of the separation of powers seems to be that the whole
power of one department should not be exercised by the same hands which possess the whole
power of either of the other department, and that no one department ought to possess directly or
indirectly an overruling influence over the others. And it has been that this doctrine should be
applied only to the powers which because of their nature are assigned by the constitution itself to
one of the departments exclusively. Hence, it does not necessarily follow that an entire and

complete separation is either desirable of was ever intended, for such a complete separation
would be impracticable if not impossible; there may be-and frequently are-areas in which
executive, legislative, and judicial powers blend or overlap; and many officers whose duties
cannot be exclusively placed under any one of these heads.
The courts have perceived the necessity of avoiding a narrow construction of a state
constitutional provision for the division of the powers of the government into three distinct
departments, for it is impractical to view the provision from the standpoint of a doctrinaire. Thus,
the modern view of separation of powers rejects the metaphysical abstractions and reverts
instead to more pragmatic, flexible, functional approach, giving recognition to the fact that then
may be a certain degree of blending or admixture of the three powers of the government.
Moreover, the doctrine of separation of powers has never been strictly or rigidly applied, and
indeed could not be, to all the ramifications of state or national governments; government would
prove abortive if it were attempted to follow the policy of separation to the letter. 9
In any case A.O. No. 308 was promulgated by the President pursuant to the quasi-legislative powers expressly
granted to him by law and in accordance with his duty as administrative head. Hence, the contention that the
President usurped the legislative prerogatives of Congress has no firm basis.
II
Having resolved that the President has the authority and prerogative to issue A.O. No. 308, I submit that it is
premature for the Court to determine the constitutionality or unconstitutionality of the National Computerized
Identification Reference System.
Basic in constitutional law is the rule that before the court assumes jurisdiction over and decide constitutional
issues, the following requisites must first be satisfied:
1) there must be an actual case or controversy involving a conflict of rights susceptible of judicial
determination;
2) the constitutional question must be raised by a proper party;
3) the constitutional question must be raised at the earliest opportunity; and
4) the resolution of the constitutional question must be necessary to the resolution of the case. 10
In this case, it is evident that the first element is missing. Judicial intervention calls for an actual case or
controversy which is defined as "an existing case or controversy that is appropriate or ripe for
determination, not conjectural or anticipatory." 11 Justice Isagani A. Cruz further expounds that "(a) justifiable
controversy is thus distinguished from a difference or dispute of a hypothetical or abstract character or from one
that is academic or moot. The controversy must be definite and concrete, touching the legal relations of parties
having adverse legal interests. It must be a real and substantial controversy admitting of special relief through a
decree that is conclusive in character, as distinguished from an opinion advising what the law would be upon a
hypothetical state of facts. . . ." 12 A.O. No. 308 does not create any concrete or substantial controversy. It
provides the general framework of the National Computerized Identification Reference System and lays down
the basic standards (efficiency, convenience and prevention of fraudulent transactions) for its cretion. But as
manifestly indicated in the subject order, it is the Inter-Agency Coordinating Committee (IACC) which is
tasked to research, study and formulate the guidelines and parameters for the use of Biometrics Technology and
in computer application designs that will and define give substance to the new system. 13 This petition is, thus,
premature considering that the IACC is still in the process of doing the leg work and has yet to codify and
formalize the details of the new system.

The majority opines that the petition is ripe for adjudication even without the promulgation of the necessary
guidelines in view of the fact that respondents have begun implementation of A.O. No. 308. The SSS, in
particular, has started advertising in newspapers the invitation to bid for the production of the I.D. cards. 14
I beg to disagree. It is not the new system itself that is intended to be implemented in the invitation to bid but
only the manufacture of the I.D. cards. Biometrics Technology is not and cannot be used in the I.D. cards as no
guidelines therefor have yet been laid down by the IACC. Before the assailed system can be set up, it is
imperative that the guidelines be issued first.
III
Without the essential guidelines, the principal contention for invalidating the new identification reference
system that it is an impermissible encroachment on the constitutionally recognized right to privacy is
plainly groundless. There is nothing in A.O. No. 308 to serve as sufficient basis for a conclusion that the new
system to be evolved violates the right to privacy. Said order simply provides the system's general framework.
Without the concomitant guidelines, which would spell out in detail how this new identification system would
work, the perceived violation of the right to privacy amounts to nothing more than mere surmise and
speculation.
What has caused much of the hysteria over the National Computerized Identification Reference System is the
possible utilization of Biometrics Technology which refers to the use of autnomated matching of physiological
or behavioral characteristics to identify a person that would violated the citizen's constitutionally protected right
to privacy.
The majority opinion has enumerated various forms and methods of Biometrics Technology which if adopted in
the National Computaized Identification Reference System would seriously threaten the right to privacy.
Among which are biocrypt retinal scan, artificial nose and thermogram. The majority also points to certain
alleged deficiencies of A O. No. 308. Thus:
1) A.O. No. 308 does not specify the particular Biometrics Technology that shall be used for the
new identification system.
2) The order dots not state whether encoding of data is limited to biological information alone for
identification purposes;
3) There is no provision as to who shall control and access the data, under what circumstances
and for what purpose; and
4) There are no controls to guard against leakage of information, thus heightening the potential
for misuse and abuse.
We should not be overwhelmed by the mere mention of the Biometrics Technology and its alleged, yet
unfounded "far-reaching effects."
There is nothing in A.O. No. 308, as it is worded, to suggest that the advanced methods of the Biometrics
Technology that may pose danger to the right of privacy will be adopted.
The standards set in A.O. No. 308 for the adoption of the new system are clear-cut and unequivocably spelled
out in the "WHEREASES" and body of the order, namely, the need to provide citizens and foreign residents
with the facility to conveniently transact business with basic service and social security providers and other
government instrumentalities; the computerized system is intended to properly and efficiently identify persons
seeking basic services or social security and reduce, if not totally eradicate fraudulent transactions and

misreprentation; the national identification reference system is established among the key basic services and
social security providers; and finally, the IACC Secretariat shall coordinate with different Social Security and
Services Agencies to establish the standards in the use of Biometrics Technology. Consequently, the choice of
the particular form and extent of Biometrics Technology that will be applied and the parameters for its use (as
will be defined in the guidelines) will necessarily and logically be guided, limited and circumscribed by the
afore-stated standards. The fear entertained by the majority on the potential dangers of this new technology is
thus securedly allayed by the specific limitations set by the above-mentioned standards. More than this, the right
to privacy is well-esconced in and directly protected by various provisions of the Bill of Rights, the Civil Code,
the Revised Penal Code, and certain laws, all so painstakingly and resourcefully catalogued in the majority
opinion. Many of these laws provide penalties for their violation in the form of imprisonment, fines, or
damages. These laws will serve as powerful deterrents not only in the establishment of any administrative rule
that will violate the constitutionally protected right to privacy, but also to would-be transgressors of such right.
Relevant to this case is the ruling of the U.S. Supreme Court in Whalen v. Roe. 15 In that case, a New York
statute was challenged for requiring physicians to identify patients obtaining prescription drugs of the statute's
"Schedule II" category (a class of drugs having a potential for abuse and a recognized medical use) so the names
and addresses of the prescription drug patients can be recorded in a centralized computer file maintained by the
New York State Department of Health. Some patients regularly receiving prescription for "Schedule II" drugs
and doctors who prescribed such drugs brought an action questioning the validity of the statute on the ground
that it violated the plaintiffs' constitutionally protected rights of privacy.
In a unanimous decision, the US Supreme Court sustained the validity of the statute on the ground that the
patient identification requirement is a reasonable exercise of the State's broad police powers. The Court also
held that there is no support in the record for an assumption that the security provisions of the statute will be
adiministered improperly. Finally, the Court opined that the remote possibility that judicial supervision of the
evidentiary use of particular items of stored information will not provide adequate protection against
unwarranted diclosures is not a sufficient reason for invalidating the patient-identification program.
To be sure, there is always a possibility of an unwarranted disclosure of confidential matters enomously
accumulated in computerized data banks and in government records relating to taxes, public health, social
security benefits, military affairs, and similar matters. But as previously pointed out, we have a sufficient
number of laws prohibiting and punishing any such unwarranted disclosures. Anent this matter, the observation
in Whalen vs. Roeis instructive:
. . . We are not unaware of the threat to privacy implicit in the accumulation of vast amounts of
personal information in computerized data banks or other massive government files. The
collection of taxes, the distribution of welfare and social security benefits, the supervision of
public health, the direction of our Armed Forces and the enforcement of the criminal laws all
require the orderly preservation of great quantities of information, much of which is personal in
character and potentially embarrassing or harmful if disclosed. The right to collect and use such
data for public purposes is typically accompanied by a concomitant statutory or regulatory duty
to avoid unwarranted disclosures. . . . 16
The majority laments that as technology advances, the level of reasonably expected privacy decreases. That
may be true. However, court should tread daintily on the field of social and economic experimentation lest they
impede or obstruct the march of technology to improve public services just on the basis of an unfounded fear
that the experimentation violates one's constitutionally protected rights. In the sobering words of Mr. Justice
Brandeis:
To stay experimentation in things social and economic is a grave responsibility. Denial of the
right to experiment may be fraught with serious consequences to the Nation. It is one of the
happy incidents of the federal system that a single courageous State may, if its citizens choose,

serve as a laboratory; and try novel social and economic experiments without risk to the rest of
the country. This Court has the power to prevent an experiment. We may strike down the statute
which embodies it on the ground that, in our opinion, the measure is arbitary, capricious or
unreaonable. We have power to do this, because the due process clause has been held by he
Court applicable to matters of substantive law as well as to matters of procedure. But in the
exercise of this high power, we must be ever on our guard, lest we erect our prejudices into legal
principles. If we would guide by the light of reason, we must let our minds be bold. 17
Again, the concerns of the majority are premature precisely because there are as yet no guidelines that will
direct the Court and serve as solid basis for determining the constitutionality of the new identification system.
The Court cannot and should not anticipate the constitutional issues and rule on the basis of guesswok. The
guidelines would, among others, determine the particular biometrics method that would be used and the specific
personal data that would be collected provide the safeguard, (if any) and supply the details on how this new
system in supposed to work. The Court should not jump the gun on the Executive.
III
On the issue of funding, the majority submits that Section 6 of A.O. No. 308, which allows the government
agencies included in the new system to obtain funding form their respective budgets, is unconstitutional for
being an illegal transfer of appropriations.
It is not so. The budget for the national identification system cannot be deemed a transfer of funds since the
same is composed of and will be implemented by the member government agancies. Morever, thses agencies
particularly the GSIS and SSS have been issuing some form of identification or membership card. The
improved ID cards that will be issued under this new system would just take place of the old identification cards
and budget-wise, the funds that were being used to manufacture the old ID cards, which are usually accounted
for under the "Supplies and Materials" item of the Government Accounting and Auditing Manual, could now be
utilized to fund the new cards. Hence, what is envisioned is not transfer of appropriations but a pooling of funds
and resources by the various government agencies involved in the project.
WHEREFORE, I vote to dismiss the petition.

MENDOZA, J., separate opinion;

My vote is to dismiss the petition in this case.
First. I cannot find anything in the text of Administrative Order No. 308 of the President of the Philippines that
would warrant a declaration that it is violative of the right of privacy. So far as I can see, all the Administrative
Orders does is
establish an Identification Reference System involving the following service agencies of
the government:
Presidential Management Staff
National Economic Developemnt Authority
Department of the Interior and Local Government

 Department of Health
Government Service Isurance System
Social Security Office
National Computer Center
create a committee, composed of the heads of the agencies concerned, to draft rules for
the System;
direct the use of the Population Reference Number (PRN) generated by the National
Census and Statistics Office as the common reference number to link the participating
agencies into an Identification Reference System, and the adoption by the agencies of
standards in the use of biometrics technology and computer designs; and
provide for the funding of the System from the budgets of the agencies concerned.
Petitioner argues, however, that "the implementation of A.O. No. 308 will mean that each and every Filipino
and resident will have a file with the government containing, at the very least, his PRN and physiological
biometrics such as, but not limited to, his facial features, hand geometry, retinal or iris pattern, DNA pattern,
fingerprints, voice characteristics, and signature analysis."
In support of his contention, petitioner quotes the following publication surfed from the Internet:
The use of biometrics is the means by which an individual may be conclusively identified. There
are two types of biometrics identifiers; Physical and behavioral characteristics, Physiological
biometrics include facial features, hand geometry, retinal and iris patterns. DNA, and
fingerprints characteristics include voice characteristics and signature analysis. 1
I do not see how from the bare provisions of the Order, the full text of which is set forth in the majority opinion,
petitioner and the majority can conclude that the Identification Reference System establishes such
comprehensive personal information dossiers that can destroy individual privacy. So far as the Order provides,
all that is contemplated is an identification system based on data which the government agencies involved have
already been requiring individuals making use of their services to give.
For example, under C.A. No. 591, 2(a) the National Statistics Office collects "by enumeration, sampling or
other methods, statistics and other information concerning population . . . social and economic institutions, and
such other statistics as the President may direct." In addition, it is in charge of the administration of the Civil
Register, 2which means that it keeps records of information concerning the civil status of persons, i.e., (a) births,
(b) deaths, (c) marriages and their annulments; (d) legitimations, (e) adoptions, (f) acknowledgments of natural
children, (g) naturalizations, and (h) changes of name. 3
Other statutes giving government agencies the power to require personal information may be cited. R.A. No.
4136, 23 gives the Land Transportation Office the power to require applicants for a driver's license to give
information regarding the following: their full names, date of birth, height, weight, sex, color of eyes, blood
type, address, and right thumbprint; 4 while R.A. No. 8239, 5 gives the Department of Foreign Affairs the
power to require passport applicants to give information concerning their names, place of birth, date of birth,
religious affiliation, marital status, and citizenship.

Justice Romero, tracing the origin of privacy to the attempt of the first man and woman to cover their nakedness
with fig leaves, bemoans the fact that technology and institutional pressures have threatened our sense of
privacy. On the other hand, the majority would have none of the Identification Reference System "to prevent the
shrinking of the right to privacy, once regarded as "the most comprehensive of rights and the right most valued
by civilized men."" 5 Indeed, techniques such as fingerprinting or electronic photography in banks have become
commonplace. As has been observed, the teaching hospital has come to be accepted as offering madical services
that compensate for the loss of the isolation of the sickbed; the increased capacity of applied sciences to utilize
more and more kinds of data and the cosequent calls for such data have weakened traditional resistance to
disclosure. As the area of relevance, political or scientific, expands, there is strong psychological pressure to
yield some ground of privacy. 6
But this is a fact of life to which we must adjust, as long as the intrusion into the domain of privacy is
reasonable. InMorfe v. Mutuc, 7 this Court dealt the coup de grace to claims of latitudinarian scope for the right
of privacy by quoting the pungent remark of an acute observer of the social scene, Carmen Guerrero-Nakpil:
Privacy? What's that? There is no precise word for it in Filipino, and as far as I know any
Filipino dialect and there is none because there is no need for it. The concept and practice of
privacy are missing from conventional Filipino life. The Filipino believes that privacy is an
unnecessary imposition, an eccentricity that is barely pardonable or, at best, an esoteric Western
afterthought smacking of legal trickery. 8
Justice Romero herself says in her separate opinion that the word privacy is not even in the lexicon of
Filipinos.
As to whether the right of privacy is "the most valued right," we do well to remember the encomiums paid as
well to other constitutional rights. For Professor Zechariah Chafee, "The writ of habeas corpus is "the most
important human rights provision in the fundamental law,"" 9 For Justice Cardozo, on the other hand, freedom
of expression "is the matrix, the indispensable condition of nearly every other form of freedom." 10
The point is that care must be taken in assigning values to constitutional rights for the purpose of calibrating
them on the judicial scale, especially if this means employing stricter standards of review for regulations alleged
to infringe certain rights deemed to be "most valued by civilized men.''
Indeed, the majority concedes that "the right of privacy does not bar all incursions into individual privacy . . .
[only that such] incursions into the right must be accompanied by proper safeguards and well-defined standards
to prevent unconstitutional invasions." 11 In the case of the Identification Reference System, the purpose is to
facilitate the transaction of business with service agencies of the government and to prevent fraud and
misrepresentation. The personal identification of an individual can facilitate his treatment in any government
hospital in case of emergency. On the other hand, the delivery of material assistance, such as free medicines,
can be protected from fraud or misrepresentation as the absence of a data base makes it possible for
unscrupulous individuals to obtain assistance from more than one government agency.
Second. Thus, the issue in this case is not really whether A.O. No. 308 violates the right of privacy formed by
emanations from the several constitutional rights cited by the majority. 12 The question is whether it violates
freedom of thought and of conscience guaranteed in the following provisions of our Bill of Rights (Art. III):
Sec. 4. No law Shall be passed abridging the freedom of speech, of expression, or of the press, or
the right of the people peaceably to assemble and petition the government for redress of
grievances.
Sec. 5. No law shall be made respecting an establishment of religion, or prohibiting the free
exercise thereof. The free exercise enjoyment of religious profession and worship, without

discrimination or preference, shall be forever be allowed. No religious test shall be required for
the exercise of civil or political rights.
More specifically, the question is whether the establishment of the Identification Reference System will not
result in the compilation of massive dossiers on individuals which, beyond their use for identification, can
become instruments of thought control. So far, the next of A.O. No. 308 affords no basis for believing that the
data gathered can be used for such sinister purpose. As already stated, nothing that is not already being required
by the concerned agencies of those making use of their servides is required by the Order in question. The Order
simply organizes service agencies of the government into a System for the purpose of facilitating the
identification of persons seeking basic services and social security. Thus, the whereas clauses of A.O. No. 308
state:
WHEREAS, there is a need to provide Filipino citizens and foreign residents with the facility to
conveniently transact business with basic services and social security providers and other
government instrumentalities;
WHEREAS, this will require a computerized system to properly and efficiently identify persons
seeking basic services and social security, and reduce, if not totally eradicate, fraudulent
transactions and misrepresentations;
WHEREAS, a concerted and collaborative effort among the various basic services and social
security providing agencies and other government instrumentalities is required to achieve such a
system:
The application of biometric technology and the standardization of computer designs can provide
service agencies with precise identification of individuals, but what is wrong with that?
Indeed, A.O. No. 308 is no more than a directive to government agencies which the President of the Philippines
has issued in his capacity as administrative head. 13 It is not a statute. It confers no right; it imposes no duty; it
affords no protection; it creates no office. 14 It is, as its name indicates, a mere administrative order, the prescise
nature of which is given in the following excerpt from the decision in the early case of Olsen & Co. v.
Herstein: 15
[It] is nothing more or less than a command from a superior to an inferior. It creates no relation
except between the official who issues it and the official who receives it. Such orders, whether
executive or departmental, have for their object simply the efficient and economical
administration of the affairs of the department to which or in which they are issued in accordance
with the law governing the subject-matter. They are administrative in their nature and do not pass
beyond the limits of the department to which they are directed or in which they are published,
and, therefore, create no rights in third persons. They are based on, and are the product of a
relationship in which power is their source and obedience their object. Disobedience to or
deviation from such an order can be punished only by the power which issued it: and, if that
power fails to administer the corrective, then the disobedience goes unpunished. In that
relationship no third person or official may intervene, not even the court. Such orders may be
very temporary, they being subject to instant revocation or modification by the power which
published them. Their very nature, as determined by the relationship which prodecued them,
demonstrates clearly the impossibility of any other person enforcing them except the one who
created them. An attempt on the part of the courts to enforce such orders would result not only in
confusion but, substantially, in departmental anarchy also. 16
Third. There is no basis for believing that, beyond the identification of individuals, the System will be used for
illegal purposes. Nor are sanctions lacking for the unauthorized use or disclosure of information gathered by the

various agencies constituting the System. For example, as the Solicitor General points out. C.A. No. 591. 4
penalizes the unauthorized use or disclosure of data furnished the NSO with a fine of not more than P600.00 or
imprisonment for not more than six months or both.
At all events, at this stage, it is premature to pass on the claim that the Identification Reference System can be
used for the purpose of compiling massive dossiers on individuals that can be used to curtail basic civil and
political rights since, if at all, this can only be provided in the implementing rules and regulations which have
yet to be promulgated. We have already stated that A.O. No. 308 is not a statute. Even in the case of statutes,
however, where implementing rules are necessary to put them into effect, it has been held that an attack on their
constitutionality would be premature. 17 As Edgar in King Lear puts it, "Ripeness is all." 18 For, to borrow some
more Shakespearean lines,
The canker galls the infants of the spring
Too oft before their buttons be disclos'd. 19
That, more than any doctrine of constitutional law I can think of, succinctly expresses the rule on
ripeness, prematurity, and hypothetical, speculative, or conjectural claims.
Of special relevance to this case is Laird v. Tatum. 20 There, a class suit was brought seeking declaratory and
injunctive relief on the claim that a U.S. Army intelligence surveillance of civilian political activity having "a
potential for civil disorder" exercised "a present inhibiting effect on [respondents'] full expression and
utilization of their First Amendment rights." In holding the case nonjusticiable, the U.S. Supreme Court, in an
opinion by Chief Justice Burger. said: 21
In recent years this Court has found in a number of cases that constitutional violations may arise
from the deterrent or ''chilling," effect of governmental regulations that fall short of a direct
prohibition against the exercise of First Amendment rights. [Citation of cases omitted] In none of
these cases, however, did the chilling effect arise merely from the individual's knowledge that a
governmental agency was engaged in certain activities or from the individual's concomitant fear
that, armed with the fruits of those activities, the agency might in the future take some other and
additional action detrimental to that individual. Rather, in each of these cases, the challenged
exercise of governmental power was regulatory, proscriptive, or compulsory in nature, and the
complainant was either presently or prospectively subject to the regulations, proscriptions, or
compulsions that he was challenging. . . .
[T]hese decisions have in no way eroded the "established principle that to entitle a private
individual to invoke the judicial power to determine the validity of executive or legislative action
he must show that he was sustained or is immediately in danger of sustaining a direct injury as
the result of that action. . . .
The respondents do not meet this test; [the] alleged "chilling" effect may perhaps be seen as
arising from respondents' perception of the system as inappropriate to the Army's role under our
form of government, or as arising from respondents' beliefs that it is inherently dangerous for the
military to be concerned with activities in the civilian sector, or as arising from respondents' less
generalized yet speculative apprehensiveness that the Army may at some future date misuse the
information in some way that would cause direct harm to respondents. Allegations of a
subjective "chill" are not an adequate substitute for a claim of specific present objective harm or
a threat of specific future harm: "the federal courts established pursuant to Article III of the
Constitution do not render advisory opinions." United Public Workers v. Mitchell, 330 US 75,
89, 91 L Ed 754, 766, 67 S Ct 556 (1947).

Fourth. Given the fact that no right of privacy is involved in this case and that any objection to the identification
Reference System on the ground that it violates freedom of thought is premature, speculative, or conjectural
pending the issuance of the implementing rules, it is clear that petitioner Blas F. Ople has no cause of action
and, therefore, no standing to bring this action. Indeed, although he assails A.O. No. 308 on the ground that it
violates the right of privacy, he claims no personal injury suffered as a result of the Order in question. Instead,
he says he is bringing this action as taxpayer, Senator, and member of the Government Service Insurance
System.
Insofar as petitioner claims an interest as taxpayer, it is sufficient to say that A.O. No. 308 does not involve the
exercise of the taxing or spending power of the government.
Insofar as he purports to sue as a member of the GSIS, neither does petitioner have an intertest sufficient to
enable him to litigate a constitutional question. Petitioner claims that in providing that the funds necessary for
implementing the System shall be taken from the budgets of the concerned agencies. A.O. No. 308 violates Art.
VI, 25(5) which. provides:
No law shall be passed authorizing any transfer of appropriations; however, the President, the
President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional Commissions may, by law, be authorized to
augment any item in the general appropriations law for their respective offices from savings in
other items of their respective appropriations.
But, as the Solicitor General states:
Petitioner's argument is anchored on two erroneous assumptions: one, that all the concerned
agencies, including the SSS and the GSIS, receive budgetary support from the national
government; and two, that the GAA is the only law whereby public funds are appropriated. Both
assumptions are wrong.
The SSS and GSIS do not presently receive budgetary support from the National Government.
They have achieved self-supporting status such that the contributions of their members are
sufficient to finance their expenses. One would be hard pressed to find in the GAA an
appropriation of funds to the SSS and the GSIS.
Furthermore, their respective charters authorize the SSS and the GSIS to disburse their funds
(Rep. Act No. 1161 [1954], as amended, Sec. 25; Pres. Decree No. 1146 [1977], as amended,
Sec. 29) without the need for a separate appropriation from the Congress.
Nor as Senator can petitioner claim standing since no power of Congress is alleged to have been impaired by
the Administrative Order in question. 22 As already stated, in issuing A.O. No. 308, the President did not
exercise the legislative power vested by the Constitution in Congress. He acted on the basis of his own powers
as administrative head of the government, as distinguished from his capacity as the Executive. Dean Sinco
elucidates the crucial distinction thus:
The Constitution of the Philippines makes the President not only the executive but also the
administrative head of the government. . . . Executive power refers to the legal and political
function of the President involving the exercise of discretion. Administrative power, on the other
hand, concerns itself with the work of applying policies and enforcing orders as determined by
proper governmental organs. These two functions are often confused by the public: but they are
distinct from each other. The President as the executive authority has the duty of supervising the
enforcement of laws for the maintenance of general peace and public order. As administrative

head, his duty is to see that every government office is managed and maintained properly by the
persons in charge of it in accordance with pertinent laws and regulations.
. . . The power of control vested in him by the Constitution makes for a strongly centralized
administrative system. It reinforces further his position as the executive of the government,
enabling him to comply more effectively with his constitutional duty to enforce the laws. It
enables him to fix a uniform standard of a administrative eficiency and to check the official
conduct of his agents. The decisions of all the officers within his department are subject to his
power of revision, either on his own motion or on the appeal of some individual who might deem
himself aggrieved by the action of an administrative official. In case of serious dereliction of
duty, he may suspend or remove the officials concerned. 23
For the foregoing reasons, the petition should be DISMISSED.

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 76759 March 22, 1990
RAMON A. GONZALES, petitioner,
vs.
LAND BANK OF THE PHILIPPINES and COURT OF APPEALS, respondents.
Ramon A. Gonzales for and in his own behalf.
Manuel P. Tiaoqui and Florencio S. Jimenez for respondent Land Bank of the Philippines.

FERNAN, C.J.:
This petition for review on certiorari seeks to reverse and set aside the December 2, 1986 decision of the Court
of Appeals, reversing the decision of the trial court and in effect denying the direct issuance of Land Bank
bonds in the name of herein petitioner as assignee thereof.
On the strength of a Deed of Assignment executed on August 8, 1981 by Ramos Plantation Company, Inc.
(hereafter referred to as the corporation) through its president, Antonio Vic Zulueta, assigning its rights under
Land Transfer Claim No. 82-757 unto petitioner Ramon A. Gonzales, the latter filed an action before the
Regional Trial Court of Manila, Branch LI entitled "Ramon A. Gonzales, plaintiff vs. Land Bank of the
Philippines and Ramos Plantation Company, Inc., defendants" docketed as Civil Case No. 84-24461 to compel
public respondent Land Bank of the Philippines to issue Land Bank Bonds for the amount of P400,000.00 in the
name of petitioner instead of in the name of the aforesaid corporation as the original and registered owner of the
property covered by Transfer Certificate of Title No. T-28750 situated in La Suerte, Malang, North Cotabato
with a total area of 251.4300 hectares, which had been brought under the land transfer program of the
government.
Defendant corporation was declared in default for failure to file its answer within the reglementary period while
defendant Land Bank filed an answer alleging that the complaint states no cause of action since there is no
privity of contract between plaintiff and itself and that it deals only with the landowner whose land was
subjected to operation land transfer of the government under Presidential Decree No. 27 in order to save time
and effort in ascertaining the identities of additional claimants.
At the pre-trial, the parties submitted a Stipulation of Facts dated July 29, 1985 (subsequently supplemented on
September 10, 1985) praying that judgment be rendered on the basis thereof. In the aforesaid stipulation dated
July 29, 1985, the following admissions and submissions were made: the execution of the Deed of Assignment;
the fact that the corporation's president, Antonio Vic Zulueta, wrote defendant bank requesting the latter to issue
the payment for the real property covered by TCT No. T-28755 through Land Bank Bonds amounting to
P400,000.00 in the name of petitioner by virtue of the Deed of Assignment with the Board Resolution attached
to said letter; that on June 30, 1982, defendant bank through its manager, Mr. Ceferino A. Pacio of the Land
Transfer Operation Department, wrote back informing the Ramos Plantation, Inc. that it has approved its Land
Transfer Claim No. 82-757 in the aggregate amount of P565,717.50 payment of which is subject to the
submission and/or accomplishment of the requirements of defendant bank; that said corporation failed to
comply with nine (9) of the requirements of defendant bank as contained in Annexes "C-1" and "C-2". 1

On the other hand, the aforesaid Supplemental Stipulation of Facts dated September 10, 1985 provided that out
of the 9 requirements for the first release in Annex "C-1" of the stipulation of facts dated July 29, 1984, only 6
requirements have not been complied with. 2
In a decision dated October 15, 1985, 3 the lower court found the plaintiff entitled to the issuance of the Land
Bank bonds, stating thus:
WHEREFORE, defendant Land Bank of the Philippines is hereby ordered to issue in the name of
Ramon A. Gonzales P400,000.00 worth of land bank bonds deducted from the P509,000.00 Land
Bank bonds payable to Ramos Plantation Company, Inc. under claim No. 82-757 with the
directive to the defendant landowner Ramos Plantation Company, Inc. to comply with the six (6)
requirements listed in paragraph 1 of the Supplemental Stipulation of Facts dated September 10,
1985. No pronouncement as to costs. 4
Defendant-appellant Land Bank of the Philippines filed an appeal before respondent Court of Appeals resulting
in the reversal of the trial court's decision and the dismissal of the complaint filed therein on the ground that
even if there was compliance with the remaining six (6) requirements by defendant Ramos Plantation, Inc. still,
the Land Bank bonds will have to be issued in the name of the said corporation and not to plaintiff-appellee. It
is only thereafter that Ramos Plantation Co., Inc. may indorse the same to plaintiff. 5
Petitioner now comes to us on appeal by certiorari to set aside the decision of respondent appellate court with
these arguments: that respondent Court of Appeals acted without jurisdiction in resolving the appeal inspite of
the motion to certify this case to the Supreme Court; that respondent Court of Appeals palpably erred in finding
that the Deed of Assignment is not effective to authorize LBP to issue the Land Bank Bonds in the name of
petitioner; that respondent Court of Appeals palpably erred in holding that petitioner is not entitled to
P400,000.00 worth of Land Bank Bonds upon compliance with the remaining six (6) requirements for the first
release thereof.
We reduce the issues to two: whether the appellate court had jurisdiction to entertain the appeal of respondent
Land Bank; and whether respondent Land Bank can be compelled to issue Land Bank bonds in the name of
petitioner by virtue of the Deed of Assignment executed by the landowner-assignor Ramos Plantation
Company, Inc. in favor of petitioner.
On the issue of lack of jurisdiction, petitioner vigorously asserts that since the trial court rendered judgment on
the basis of the stipulation of facts submitted by the parties, the appeal from such a decision can only raise
questions of law and therefore, respondent Land Bank should have gone directly to the Supreme Court on a
petition forcertiorari.
We do not fully subscribe to petitioner's contention, for as correctly observed by the Solicitor General, the
existence of a stipulation of facts between the parties does not automatically mean that the parties agreed on all
the facts considering that stipulations may be total or partial. 6 In this instance, it was merely partial.
A perusal of the aforementioned Stipulation and Supplemental Stipulation of Facts dated July 29, 1985 and
September 10, 1985, respectively, readily reveals that the same do not contain a complete or sufficient picture
of the circumstances among the parties and that certain vital matters are left out in said stipulations, i.e., the
significant policy of the Land Bank to issue its bonds directly and only in the name of the landowners; and the
fact that there are different stages in the release of payments under the operation land transfer program with
each stage having different requirements that have to be complied with by the landowner in order to be entitled
to payment under a land transfer claim. In view of these omissions in the Stipulations, the remedy of appeal
before the appellate court resorted to by respondent bank and assailed by petitioner is proper because it involved
not only pure questions of law but mixed questions of law and fact.

On the more substantive issue of whether public respondent Land Bank may be compelled to honor the subject
deed of assignment, it will be noted that respondent bank in denying the issuance of the bond in the name of the
petitioner-assignee was guided by Resolution No. 75-68 entitled "PROPER PARTIES TO RECEIVE LAND
TRANSFER PAYMENT" promulgated purposely to govern, among others, the issuance of Land Bank Bonds
to assignees by virtue of Deeds of Assignment.
Thereunder the Land Bank can only issue bonds in the name of the assignor-landowner. It is only after the
issuance of bonds in the landowner's name that he shall be required to make the necessary indorsement of the
bonds to his assignee. This is in consonance with the Land Bank's policy to deal primarily with the landowners
in order to save time and effort in ascertaining the identities of claimants. 7
However, petitioner relying on the provisions of Article 1311 of the Civil Code, 8 maintains that by virtue of
said deed, he stepped into the shoes of his assignor and acquired all the rights of the latter and it was error on
the part of the appellate court to find that the aforesaid Deed of Assignment is not effective to authorize the
Land Bank of the Philippines to issue the Land Bank Bonds in the name of petitioner upon compliance with the
remaining six (6) requirements for the first release thereof.
There is indeed no question that petitioner stepped into the shoes of his assignor, the defendant corporation. But
petitioner overlooked the fact that when the corporation assigned its rights to him under Land Transfer Claim
No. 82-757, the same was subject to the rules and restrictions imposed by respondent Land Bank on the matter
of assignment of rights.
In the promulgation of said rules and regulations, the Land Bank relied on the provisions of Section 76, R.A.
3844 as amended by P.D. 251, which specifically provides:
Sec. 76. Issuance of Bonds. . . . The Board of Directors shall have the power to prescribe rules
and regulations for the issuance, reissuance, servicing, placement and redemption of the bonds
herein authorized to be issued as well as the registration of such bonds at the request of the
holders thereof.
The act of assignment could not operate to erase liens or restrictions burdening the right assigned. The assignee
cannot, after all, acquire a greater right than that pertaining to the assignor. 9
Thus, when Ramos Plantation Company, Inc. assigned its lights, title and interest in Land Transfer Claim No.
82-757 for the amount of P400,000.00 in favor of petitioner Ramon A. Gonzales, the latter acquired the same
subject to the restrictions on assignment of rights embodied in Resolution No. 75-68 dated February 25,
1975 10 passed by the Board of respondent Land Bank of the Philippines, the pertinent provision of which reads:
4. In Assignment of Rights entered into by landowners vesting upon the Assignee the right to
receive full or partial payment from the Land Bank pursuant to land transfer, the same, if found
valid in form and substance, shall be recognized by the Land Bank. Whenever practicable, Land
Bank bonds issued therefor must be made payable to the Assignor-Landowner who shall be
required to make the necessary indorsement of said bonds to the Assignee. In case the cash
portion is the one assigned, the check in payment thereof shall be issued to the original
landowner who shall be required to make the indorsement to the Assignee. Thus, for record
purposes, it will appear that payment was directly to the landowner concerned and who, by
reason of the Assignment, has caused the necessary indorsement of the bonds and/or check, as
the case may be, to the Assignee.
It is an elementary rule in administrative law that administrative regulations and policies enacted by
administrative bodies to interpret the law which they are entrusted to enforce have the force of law and entitled
to great respect. They have in their favor a presumption of legality. 11

This Court is in total agreement with respondent appellate court's finding that it must be the Ramos Plantation
Company, Inc. which should comply with all the requirements imposed by respondent bank to effect the release
of payments under land transfer claims because of the restriction that the bonds will only be released in the
name of the landowner-assignor corporation which may thereafter indorse the same to petitioner. In fact, in the
decision of the trial court, Ramos Plantation Company, Inc. was directed to comply with the six (6)
requirements 12 listed in paragraph 1 of the Supplemental Stipulation of Facts dated September 10, 1985. Since
no appeal was taken by Ramos Plantation Company, Inc. from said decision, said directive has become final
and executory.
However, the decision of the appellate court dismissing the complaint of petitioner had the effect of reversing
said directive, thereby leaving petitioner without legal authority to compel Ramos Plantation Company, Inc. to
comply with the requirements of the Land Bank for the release of the bonds and thereafter to endorse the same
to petitioner as assignee thereof. The decision of the appellate court should therefore be, as it is hereby,
modified accordingly.
WHEREFORE, the decision of the appellate court is hereby MODIFIED. The directive to Ramos Plantation
Company, Inc. contained in the lower court's decision is reinstated. Ramos Plantation Company, Inc. is ordered
to comply within thirty (30) days from notice with the six (6) requirements listed in paragraph 1 of the
Supplemental Stipulation of Facts dated September 10, 1985, and as soon as the bonds are released in its name,
to immediately endorse the same to petitioner as assignee thereof.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 103533 December 15, 1998

MANILA JOCKEY CLUB, INC. AND PHILIPPINE RACING CLUB, INC., petitioners,
vs.
THE COURT OF APPEALS AND PHILIPPINE RACING COMMISSION, respondents.

QUISUMBING, J.:
This is a Petition for Review on Certiorari seeking the reversal of the decision 1 of the Court of Appeals in CAG.R. SP No. 25251 dated September 17, 1991 and the resolution 2 dated January 8, 1992, which denied the
motion for reconsideration. At issue here is the control and disposition of "breakages" 3 in connection with the
conduct of horse-racing.
The pertinent facts on record are as follows:
On June 18, 1948, Congress approved Republic Act No. 309, entitled "An Act to Regulate Horse-Racing in the
Philippines." This Act consolidated all existing laws and amended inconsistent provisions relative to horse
racing. It provided for the distribution of gross receipts from the sale of betting tickets, but is silent on the
allocation of so-called "breakages." Thus the practice, according to the petitioners, was to use the "breakages"
for the anti-bookies drive and other sales promotions activities of the horse racing clubs.
On October 23, 1992, petitioners, Manila Jockey Club, Inc. (MJCI) and Philippine Racing Club, Inc. (PRCI),
were granted franchises to operate and maintain race tracks for horse racing in the City of Manila and the
Province of Rizal by virtue of Republic Act Nos. 6631 and 6632, respectively, and allowed to hold horse races,
with bets, on the following dates:
. . . Saturdays, Sundays and official holidays of the year, excluding Thursday and Fridays of the
Holy Week, June twelfth, commonly known as Independence Day, Election Day and December
thirtieth, commonly known as Rizal Day. (Sec. 5 of R.A. 6631)
. . . Saturday, Sundays, and official holiday of the year, except on those official holidays where
the law expressly provides that no horse races are to be held. The grantee may also conduct races
on the eve of any public holiday to start not earlier than five-thirty (5:30) o'clock in the afternoon
but not to exceed five days a year. (Sec. 7 of R.A. 6632)
Said laws carried provisions on the allocation of "breakages" to beneficiaries as follows:
Franchise Laws
R.A. 6631 4 R.A. 6632 5

(for MJCI) (for PRCI)

Provincial or city hospitals 25%
Rehabilitation of drug addicts 25% 50%
For the benefit of Philippine
Amateur Athletes Federation 50% 25%
Charitable institutions 25%
On March 20, 1974, Presidential Decree No. 420 was issued creating the Philippine Racing Commission
(PHILRACOM), giving it exclusive jurisdiction and control over every aspect of the conduct of horse racing,
including the framing and scheduling of races. 6 By virtue of this power, the PHILRACOM authorized the
holding of races on Wednesdays starting on December 22, 1976. 7
In connection with the new schedule of races, petitioners made a joint query regarding the ownership of
breakages accumulated during Wednesday races. In response to the query, PHILRACOM rendered its opinion
in a letter dated September 20, 1978. It declared that the breakages belonged to the racing clubs concerned, to
wit:
We find no further need to dissect the provisions of P.D. 420 to come to a legal conclusion. As
can be clearly seen from the foregoing discussion and based on the established precedents, there
can be no doubt that the breakage of Wednesday races shall belong to the racing club
concerned. 8
Consequently, the petitioners allocated the proceeds of breakages for their own business purpose:
Thereafter, PHILRACOM authorized the holding of races on Thursdays from November 15, 1984 to December
31, 1984 and on Tuesdays since January 15, 1985 up to the present. These mid-week races are in addition to
those days specifically mentioned in R.A. 6631 and R.A. 6632. Likewise, petition allocated the breakages from
these races for their own uses.
On December 16, 1986 President Corazon Aquino amended certain provisions Sec. 4 of R.A. 8631 and Sec. 6
of R.A. 6632 through Executive Orders No. 88 and 89. Under these Executive Orders, breakages were allocated
to beneficiaries, as follows:
Franchise Laws
E.O. 89 9 E.O. 88 10
(for MJCI) (for PRCI)
Provincial or city hospitals 25%
Rehabilitation of drug addicts 25% 50%
For the benefit of Philippine
Racing Commission 50% 25%

Charitable institutions 25%

On April 23, 1987, PHILRACOM itself addressed a query to the Office of the President asking which agency is
entitled to dispose of the proceeds of the "breakages" derived from the Tuesday and Wednesday races.
In a letter dated May 21, 1987, the Office of the President, through then Deputy Executive Secretary Catalino
Macaraig, Jr., replied that "the disposition of the breakages rightfully belongs to PHILRACOM, not only those
derived from the Saturday, Sunday and holiday races, but also from the Tuesday and Wednesday races in
accordance with the distribution scheme prescribed in said Executive Orders". 11
Controversy arose when herein respondent PHILRACOM, sent a series of demand letters to petitioners MJCI
and PRCI, requesting its share in the "breakages" of mid-week-races and proof of remittances to other legal
beneficiaries as provided under the franchise laws. On June 8, 1987, PHILRACOM sent a letter of demand to
petitioners MJCI and PRCI asking them to remit PHILRACOM's share in the "breakages" derived from the
Tuesday, Wednesday and Thursday races in this wise:
xxx xxx xxx
Pursuant to Board Resolution dated December 21, 1986, and Executive Order Nos. 88 and 89
series of 1986, and the authority given by the Office of the President dated May 21, 1987, please
remit to the Commission the following:
1) PHILRACOM's share in the breakages derived from Wednesday racing for the
period starting December 22, 1976 up to the December 31, 1986.
2) PHILRACOM's share in the breakages derived from Thursday racing for the
period starting November 15, 1984 up to December 31, 1984; and
3) PHILRACOM's share in the breakages derived from Tuesday racing for the
period starting January 15, 1985 up to December, 1986.
4) Kindly furnish the Commission with the breakdown of all breakages derived
from Tuesday, Thursdays and Wednesdays racing that you have remitted to the
legal beneficiaries. 12
On June 16, 1987, petitioners MJCI and PRCI sought reconsideration 13 of the May 21, 1987 opinion of then
Deputy Executive Secretary Macaraig, but the same was denied by the Office of the President in its letter dated
April 11, 1988. 14
On April 25, 1988, PHILRACOM wrote another letter 15 to the petitioners MJCI and PRCI seeking the
remittance of its share in the breakages. Again, on June 13, 1990, PHILRACOM reiterated its previous demand
embodied in its letter of April 25, 1 988. 16
Petitioners ignored said demand. Instead, they filed a Petition for Declaratory Relief before the Regional Trial
Court, Branch 150 of Makati, on the ground that there is a conflict between the previous opinion of
PHILRACOM dated September 20, 1978 and the present position of PHILRACOM, as declared and affirmed
by the Office of the President in its letters dated May 21, 1987 and April 11, 1988. Petitioners averred that there
was an "actual controversy" between the parties, which should be resolved.
On March 11, 1991, the trial court rendered judgment, disposing as follows:

WHEREFORE, and in view of all the foregoing considerations, the Court hereby declares and
decides as follows:
a) Executive Orders Nos. 88 and 89 do not and cannot cover the disposition and
allocation of mid-week races, particularly those authorized to be held during
Tuesdays, Wednesdays and those which are not authorized under Republic Acts
6631 and 6632; and
b) The ownership by the Manila Jockey Club, Inc. and the Philippine Racing
Club, Inc. of the breakages they derive from mid-week races shall not be
disturbed, with the reminder that the breakages should be strictly and wholly
utilized for the purpose for which ownership thereof has been vested upon said
racing entities.
SO ORDERED. 17
Dissatisfied, respondent PHILRACOM filed a Petition for Certiorari with prayer for the issuance of a writ of
preliminary injunction before this Court, raising the lone question of whether or not E.O. Nos. 88 and 89 cover
breakages derived from the mid-week races. However, we referred the case to the Court of Appeals, which
eventually reversed the decision of the trial court, and ruled as follows:
xxx xxx xxx
The decision on the part of PHILRACOM to authorize additional racing days had the effect of
widening the scope of Section 5 of RA 6631 and Section 7 of RA 6632. Consequently, private
respondents derive their privilege to hold races on the designated days not only their franchise
acts but also from the order issued by the PHILRACOM. No provision of law became
inconsistent with the passage of the Order granting additional racing days. Neither was there a
special provision set to govern those mid-week races. The reason is simple. There was no need
for any new provisions because there are enough general provisions to cover them. The
provisions on the disposition and allocation of breakages being general in character apply to
breakages derived on any racing day. 18
xxx xxx xxx
WHEREFORE, based on the foregoing analysis and interpretation of the laws in question, the
judgment of the trial court is hereby SET ASIDE. Decision is hereby rendered:
1. declaring Section 4 of RA 6631 as amended by E.O. 89 and Section 6 of RA 6632 as amended
by E.O. 88 to cover the disposition and allocation of breakages derived on all races conducted by
private respondents on any racing day, whether as provided for under Section 4 of RA 6631 or
Section 6 of RA 6632 or as ordered by PHILRACOM in the exercise of its powers under P.D.
420;
2. ordering private respondent to remit to PHILRACOM its share under E.O. 88 and E.O. 89
derived from races held on Tuesday, Wednesdays, Thursday as authorized by PHILRACOM.
SO ORDERED. 19
Petitioners filed a motion for reconsideration, but it was denied for lack of merit, with respondent Court of
Appeals further declaring that:

xxx xxx xxx

In so far as the prospective application of Executive Orders Nos. 88 and 89 is concerned. We
have no disagreement with the respondents. Since PHILRACOM became the beneficiary of the
breakages only upon effectivity of Executive Order Nos. 88 and 89, it is therefore entitled to
such breakages from December 16, 1986 when said Executive Orders were issued. However, we
do not concede that respondents are entitled to breakages prior to December 16, 1986 because it
is clear that the applicable laws from 1976 to December 16, 1986 were R.A. 6631 and R.A.
6632, which specifically apportion the breakages to specified beneficiaries among which was the
PAAF, a government agency. Since respondents admit that PHILRACOM (Petitioner) was
merely placed in lieu of PAAF as beneficiary/recipient of breakages, then whatever breakages
was due to PAAF as one of the beneficiaries under R.A. Nos. 6631 and 6632 accrued to or
should belong to PHILRACOM as successor to the defunct PAAF.
Finding the Motion for Reconsideration without merit, and for reasons indicated, the Motion is
denied.
SO ORDERED. 20
Consequent to the aforequoted adverse decision, petitioners MJCI and PRCI filed this petition for review under
Rule 45.
The main issue brought by the parties for the Court's resolution is: Who are the rightful beneficiaries of the
breakages derived from mid-week races? This issue also carries an ancillary question: assuming PHILRACOM
is entitled to the mid-week breakages under the law, should the petitioners remit the money from the time the
mid-week races started, or only upon the promulgation of E.O. Nos. 88 and 89?
Petitioners assert that franchise laws should be construed to apply the distribution scheme specifically and
exclusively to the racing days enumerated in Sec. 5 of R.A. 6631, and Sec. 7 of R.A. 6632. They claim that
disposition of breakages under these laws should be limited to races conducted on "all Saturdays, Sundays, and
official holidays of the year, except, on those official holidays where the law expressly provides that no horse
races are to be held", hence, there is no doubt that the breakages of Wednesday races shall belong to the racing
clubs concerned. 21 They even advance the view that "where a statute by its terms is expressly limited to certain
matters, it may not by interpretation or construction be extended to other matters" 22
However, respondent PHILRACOM contends that R.A. Nos. 6631 and 6632 are laws intended primarily to
grant petitioners their respective franchises to construct, operate, and maintain a race track for horse
racing. 23 When PHILRACOM added mid-week races, the franchises given to the petitioners remained the
same. Logically, what applies to races authorized under Republic Act Nos. 6631 and 6632 should also apply to
races additionally authorized by PHILRACOM, namely mid-week races, because these are general provisions
which apply general rues and procedures governing the operation of the races. Consequently, if the authorized
racing days are extended, these races must therefore be governed by the same rules and provisions generally
provided therein.
We find petitioners' position on the main issue lacking in merit and far from persuasive.
Franchise laws are privileges 24 conferred by the government on corporations to do that "which does not belong
to the citizens of the country generally by common right". 25 As a rule, a franchise springs from contracts
between the sovereign power and the private corporation for purposes of individual advantage as well as public
benefit. 26 Thus, a franchise partakes of a double nature and character. 27 In so far as it affects or concerns the
public, it is public juris and subject to governmental control. 28 The legislature may prescribe the conditions and
terms upon which it may be held, and the duty of grantee to the public exercising it. 29

As grantees of a franchise, petitioners derive their existence from the same. Petitioners' operations are governed
by all existing rules relative to horse racing provided they are not inconsistent with each other and could be
reasonably harmonized. Therefore, the applicable laws are R.A. 309, as amended, R.A. 6631 and 6632, as
amended by E.O. 88 and 89, P.D. 420 and the orders issued PHILRACOM. Consequently, every statute should
be construed in such a way that will harmonize it with existing laws. This principle is expressed in the legal
maxim "interpretare et concordare leges legibus est optimus interpretandi", that is, to interpret and to do it in
such a way as to harmonize laws with laws is the best method of interpretation. 30
A reasonable reading of the horse racing laws favors the determination that the entities enumerated in the
distribution scheme provided under R.A. Nos. 6631 and 6632, as amended by Executive Orders 88 and 89, are
the rightful beneficiaries of breakages from mid-week races. Petitioners should therefore remit the proceeds of
breakages to those benefactors designated by the aforesaid laws.
The holding of horse races on Wednesdays is in addition to the existing schedule of races authorized by law.
Since this new schedule became part of R.A. 6631 and 6632 the set of procedures in the franchise laws
applicable to the conduct of horse racing business must likewise be applicable to Wednesday or other mid-week
races. A fortiori, the granting of the mid-week races does not require another legislative act to reiterate the
manner of allocating the proceeds of betting tickets. Neither does the allocation of breakages under the same
provision need to be isolated to construe another distribution scheme. No law can be viewed in a condition of
isolation or as the beginning of a new legal system. 31 A supplemental law becomes an addition to the existing
statutes, or a section thereof; and its effect is not to change in any way the provisions of the latter but merely to
extend the operation thereof, or give additional power to enforce its provisions, as the case may be. In enacting
a particular statute, legislators are presumed to have full knowledge and to taken full cognizance of the existing
laws on the same subject or those relating thereto.
Proceeding to the subsidiary issue, the period for the remittance of breakages to the beneficiaries should have
commenced from the time PHILRACOM authorized the holding of mid-week races because R.A. Nos. 6631
and 6632 were ready in effect then. The petitioners contend that they cannot be held retroactively liable to
respondent PHILRACOM for breakages prior to the effectivity of E.O. Nos. 88 and 89. They assert that the real
intent behind E.O. Nos. 88 and 89 was to favor the respondent PHILRACOM anew with the benefits which
formerly had accrued in favor of Philippine Amateur Athletic Federation (PAAF). They opine that since laws
operate prospectively unless the legislator intends to give them retroactive effect, the accrual of these breakages
should start on December 16, 1986, the date of effectivity of E.O. Nos. 88 and 89. 32 Now, even if one of the
benefactors of breakages, the PAAF, asprovided by R.A. 6631 and 6632 had ceased operation, it is still not
proper for the petitioners to presume that they were entitled to PAAF's share. When the petitioners mistakenly
appropriated the breakages for themselves, they became the implied trustees for those legally entitled to the
proceeds. This is in consonance with Article 1456 of the Civil Code, which provides that:
Art. 1456 If property is acquired through mistake or fraud, the person obtaining it is, by force
of law, considered a trustee of an implied trust for the benefit of the person from whom the
property comes.
The petitioners should have properly set aside amount for the defunct PAAF, until an alternative beneficiary
was designated, which as subsequently provided for by Executive Order Nos. 88 and 89, is PHILRACOM:
xxx xxx xxx
Secs. 2 All the cash balances and accumulated amounts corresponding to the share of the
Philippine Amateur Athletic Federation/Ministry of Youth and Sports Development, pursuant to
Section 6 of Republic Act No. 6632, not remitted by the Philippine Racing Club, Inc./Manila
Jockey Club Inc., are hereby transferred to the Philippine Racing Commission to be constituted
into a TRUST FUND to be used exclusively for the payment of additional prizes for races

sponsored by the Commission and for necessary outlays and other expenses relative to horsebreeding activities of the National Stud Farm. . . . . . . [E.O. No. 88]
xxx xxx xxx
Sec. 2. Any provision of law to the contrary notwithstanding, all cash balances and accumulated
amounts corresponding to the share of the Philippine Amateur Athletic Federation/Ministry of
Youth and Sports Development, pursuant to Republic Act No. 6631, not remitted by the Manila
Jockey Club, Inc., are hereby constituted into a TRUST FUND to be used exclusively for the
payment of additional prizes for races sponsored by the Philippine Racing Commission and for
the necessary capital outlays and other expenses relative to horse-breeding activities of the
National Stud Farm. . . . . . . . [E.O. No. 89]
While herein petitioners might have relied on a prior opinion issued by an administrative body, the wellentrenched principle is that the State could not be estopped by a mistake committed by its officials or
agents. 33 Well-settled also is the rule that the erroneous application of the law by public officers does not
prevent a subsequent correct application of the law. 34 Although there was an initial interpretation of the law by
PHILRACOM, a court of law could not be precluded from setting that interpretation aside if later on it is shown
to be inappropriate.
Moreover, the detrimental consequences of depriving the city hospitals and other institutions of the funds
needed for rehabilitation of drug dependents and other patients are all too obvious. It goes without saying that
the allocation of breakages in favor of said institutions is a policy decision in pursuance of social development
goals worthy of judicial approbation.
Nor could we be oblivious to the reality that horse racing although authorized by law is still a form of gambling.
Gambling is essentially antagonistic to the aims of enhancing national productivity and self-reliance. 35 For this
reason, legislative franchises impose limitations on horse racing and betting. Petitioner's contention that a
gambling franchise is a public contract protected by the Constitutional provision on non-impairment of contract
could not be left unqualified. For as well said in Lim vs. Pacquing: 36
. . . it should be remembered that a franchise is not in the strict sense a simple contract but rather
it is, more importantly, a mere privilege specially in matters which are within the government's
power to regulate and even prohibit through the exercise of the police power. Thus, a gambling
franchise is always subject to the exercise of police power for the public welfare. 37
That is why we need to stress anew that a statute which authorizes a gambling activity or business should be
strictly construed, and every reasonable doubt be resolved so as to limit rather than expand the powers and
rights claimed by franchise holders under its authority. 38
WHEREFORE, there being no reversible error, the appealed decision and the resolution of the respondent Court
of Appeals in CA-G.R. SP No. 25251, are hereby AFFIRMED, and the instant petition is hereby DENIED for
lack of merit.
Costs against petitioners.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-63915 April 24, 1985
LORENZO M. TAADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS FOR
BROTHERHOOD, INTEGRITY AND NATIONALISM, INC. [MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON. JOAQUIN
VENUS, in his capacity as Deputy Executive Assistant to the President , MELQUIADES P. DE LA
CRUZ, in his capacity as Director, Malacaang Records Office, and FLORENDO S. PABLO, in his
capacity as Director, Bureau of Printing, respondents.

ESCOLIN, J.:
Invoking the people's right to be informed on matters of public concern, a right recognized in Section 6, Article
IV of the 1973 Philippine Constitution, 1 as well as the principle that laws to be valid and enforceable must be
published in the Official Gazette or otherwise effectively promulgated, petitioners seek a writ of mandamus to
compel respondent public officials to publish, and/or cause the publication in the Official Gazette of various
presidential decrees, letters of instructions, general orders, proclamations, executive orders, letter of
implementation and administrative orders.
Specifically, the publication of the following presidential issuances is sought:
a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171, 179, 184, 197, 200, 234, 265, 286,
298, 303, 312, 324, 325, 326, 337, 355, 358, 359, 360, 361, 368, 404, 406, 415, 427, 429, 445,
447, 473, 486, 491, 503, 504, 521, 528, 551, 566, 573, 574, 594, 599, 644, 658, 661, 718, 731,
733, 793, 800, 802, 835, 836, 923, 935, 961, 1017-1030, 1050, 1060-1061, 1085, 1143, 1165,
1166, 1242, 1246, 1250, 1278, 1279, 1300, 1644, 1772, 1808, 1810, 1813-1817, 1819-1826,
1829-1840, 1842-1847.
b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130, 136, 141, 150, 153, 155, 161,
173, 180, 187, 188, 192, 193, 199, 202, 204, 205, 209, 211-213, 215-224, 226-228, 231-239,
241-245, 248, 251, 253-261, 263-269, 271-273, 275-283, 285-289, 291, 293, 297-299, 301-303,
309, 312-315, 325, 327, 343, 346, 349, 357, 358, 362, 367, 370, 382, 385, 386, 396-397, 405,
438-440, 444- 445, 473, 486, 488, 498, 501, 399, 527, 561, 576, 587, 594, 599, 600, 602, 609,
610, 611, 612, 615, 641, 642, 665, 702, 712-713, 726, 837-839, 878-879, 881, 882, 939-940,
964,997,1149-1178,1180-1278.
c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.
d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270, 1281, 1319-1526, 1529, 1532, 1535,
1538, 1540-1547, 1550-1558, 1561-1588, 1590-1595, 1594-1600, 1606-1609, 1612-1628, 16301649, 1694-1695, 1697-1701, 1705-1723, 1731-1734, 1737-1742, 1744, 1746-1751, 1752, 1754,
1762, 1764-1787, 1789-1795, 1797, 1800, 1802-1804, 1806-1807, 1812-1814, 1816, 1825-1826,
1829, 1831-1832, 1835-1836, 1839-1840, 1843-1844, 1846-1847, 1849, 1853-1858, 1860, 1866,

1868, 1870, 1876-1889, 1892, 1900, 1918, 1923, 1933, 1952, 1963, 1965-1966, 1968-1984,
1986-2028, 2030-2044, 2046-2145, 2147-2161, 2163-2244.
e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457- 471, 474-492, 494-507, 509-510,
522, 524-528, 531-532, 536, 538, 543-544, 549, 551-553, 560, 563, 567-568, 570, 574, 593, 594,
598-604, 609, 611- 647, 649-677, 679-703, 705-707, 712-786, 788-852, 854-857.
f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39, 50, 51, 59, 76, 80-81, 92, 94, 95,
107, 120, 122, 123.
g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378, 380-433, 436-439.
The respondents, through the Solicitor General, would have this case dismissed outright on the ground that
petitioners have no legal personality or standing to bring the instant petition. The view is submitted that in the
absence of any showing that petitioners are personally and directly affected or prejudiced by the alleged nonpublication of the presidential issuances in question 2 said petitioners are without the requisite legal personality
to institute this mandamus proceeding, they are not being "aggrieved parties" within the meaning of Section 3,
Rule 65 of the Rules of Court, which we quote:
SEC. 3. Petition for Mandamus.When any tribunal, corporation, board or person unlawfully
neglects the performance of an act which the law specifically enjoins as a duty resulting from an
office, trust, or station, or unlawfully excludes another from the use a rd enjoyment of a right or
office to which such other is entitled, and there is no other plain, speedy and adequate remedy in
the ordinary course of law, the person aggrieved thereby may file a verified petition in the proper
court alleging the facts with certainty and praying that judgment be rendered commanding the
defendant, immediately or at some other specified time, to do the act required to be done to
Protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason
of the wrongful acts of the defendant.
Upon the other hand, petitioners maintain that since the subject of the petition concerns a public right and its
object is to compel the performance of a public duty, they need not show any specific interest for their petition
to be given due course.
The issue posed is not one of first impression. As early as the 1910 case of Severino vs. Governor
General, 3 this Court held that while the general rule is that "a writ of mandamus would be granted to a private
individual only in those cases where he has some private or particular interest to be subserved, or some
particular right to be protected, independent of that which he holds with the public at large," and "it is for the
public officers exclusively to apply for the writ when public rights are to be subserved [Mithchell vs.
Boardmen, 79 M.e., 469]," nevertheless, "when the question is one of public right and the object of the
mandamus is to procure the enforcement of a public duty, the people are regarded as the real party in interest
and the relator at whose instigation the proceedings are instituted need not show that he has any legal or special
interest in the result, it being sufficient to show that he is a citizen and as such interested in the execution of the
laws [High, Extraordinary Legal Remedies, 3rd ed., sec. 431].
Thus, in said case, this Court recognized the relator Lope Severino, a private individual, as a proper party to the
mandamus proceedings brought to compel the Governor General to call a special election for the position of
municipal president in the town of Silay, Negros Occidental. Speaking for this Court, Mr. Justice Grant T. Trent
said:
We are therefore of the opinion that the weight of authority supports the proposition that the
relator is a proper party to proceedings of this character when a public right is sought to be
enforced. If the general rule in America were otherwise, we think that it would not be applicable

to the case at bar for the reason 'that it is always dangerous to apply a general rule to a particular
case without keeping in mind the reason for the rule, because, if under the particular
circumstances the reason for the rule does not exist, the rule itself is not applicable and reliance
upon the rule may well lead to error'
No reason exists in the case at bar for applying the general rule insisted upon by counsel for the
respondent. The circumstances which surround this case are different from those in the United
States, inasmuch as if the relator is not a proper party to these proceedings no other person could
be, as we have seen that it is not the duty of the law officer of the Government to appear and
represent the people in cases of this character.
The reasons given by the Court in recognizing a private citizen's legal personality in the aforementioned case
apply squarely to the present petition. Clearly, the right sought to be enforced by petitioners herein is a public
right recognized by no less than the fundamental law of the land. If petitioners were not allowed to institute this
proceeding, it would indeed be difficult to conceive of any other person to initiate the same, considering that the
Solicitor General, the government officer generally empowered to represent the people, has entered his
appearance for respondents in this case.
Respondents further contend that publication in the Official Gazette is not a sine qua non requirement for the
effectivity of laws where the laws themselves provide for their own effectivity dates. It is thus submitted that
since the presidential issuances in question contain special provisions as to the date they are to take effect,
publication in the Official Gazette is not indispensable for their effectivity. The point stressed is anchored on
Article 2 of the Civil Code:
Art. 2. Laws shall take effect after fifteen days following the completion of their publication in
the Official Gazette, unless it is otherwise provided, ...
The interpretation given by respondent is in accord with this Court's construction of said article. In a long line
of decisions, 4 this Court has ruled that publication in the Official Gazette is necessary in those cases where the
legislation itself does not provide for its effectivity date-for then the date of publication is material for
determining its date of effectivity, which is the fifteenth day following its publication-but not when the law
itself provides for the date when it goes into effect.
Respondents' argument, however, is logically correct only insofar as it equates the effectivity of laws with the
fact of publication. Considered in the light of other statutes applicable to the issue at hand, the conclusion is
easily reached that said Article 2 does not preclude the requirement of publication in the Official Gazette, even
if the law itself provides for the date of its effectivity. Thus, Section 1 of Commonwealth Act 638 provides as
follows:
Section 1. There shall be published in the Official Gazette [1] all important legisiative acts and
resolutions of a public nature of the, Congress of the Philippines; [2] all executive and
administrative orders and proclamations, except such as have no general applicability; [3]
decisions or abstracts of decisions of the Supreme Court and the Court of Appeals as may be
deemed by said courts of sufficient importance to be so published; [4] such documents or classes
of documents as may be required so to be published by law; and [5] such documents or classes of
documents as the President of the Philippines shall determine from time to time to have general
applicability and legal effect, or which he may authorize so to be published. ...
The clear object of the above-quoted provision is to give the general public adequate notice of the various laws
which are to regulate their actions and conduct as citizens. Without such notice and publication, there would be
no basis for the application of the maxim "ignorantia legis non excusat." It would be the height of injustice to

punish or otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever, not
even a constructive one.
Perhaps at no time since the establishment of the Philippine Republic has the publication of laws taken so vital
significance that at this time when the people have bestowed upon the President a power heretofore enjoyed
solely by the legislature. While the people are kept abreast by the mass media of the debates and deliberations in
the Batasan Pambansaand for the diligent ones, ready access to the legislative recordsno such publicity
accompanies the law-making process of the President. Thus, without publication, the people have no means of
knowing what presidential decrees have actually been promulgated, much less a definite way of informing
themselves of the specific contents and texts of such decrees. As the Supreme Court of Spain ruled: "Bajo la
denominacion generica de leyes, se comprenden tambien los reglamentos, Reales decretos, Instrucciones,
Circulares y Reales ordines dictadas de conformidad con las mismas por el Gobierno en uso de su potestad. 5
The very first clause of Section I of Commonwealth Act 638 reads: "There shall be published in the Official
Gazette ... ." The word "shall" used therein imposes upon respondent officials an imperative duty. That duty
must be enforced if the Constitutional right of the people to be informed on matters of public concern is to be
given substance and reality. The law itself makes a list of what should be published in the Official Gazette.
Such listing, to our mind, leaves respondents with no discretion whatsoever as to what must be included or
excluded from such publication.
The publication of all presidential issuances "of a public nature" or "of general applicability" is mandated by
law. Obviously, presidential decrees that provide for fines, forfeitures or penalties for their violation or
otherwise impose a burden or. the people, such as tax and revenue measures, fall within this category. Other
presidential issuances which apply only to particular persons or class of persons such as administrative and
executive orders need not be published on the assumption that they have been circularized to all concerned. 6
It is needless to add that the publication of presidential issuances "of a public nature" or "of general
applicability" is a requirement of due process. It is a rule of law that before a person may be bound by law, he
must first be officially and specifically informed of its contents. As Justice Claudio Teehankee said in Peralta
vs. COMELEC 7:
In a time of proliferating decrees, orders and letters of instructions which all form part of the law
of the land, the requirement of due process and the Rule of Law demand that the Official Gazette
as the official government repository promulgate and publish the texts of all such decrees, orders
and instructions so that the people may know where to obtain their official and specific contents.
The Court therefore declares that presidential issuances of general application, which have not been published,
shall have no force and effect. Some members of the Court, quite apprehensive about the possible unsettling
effect this decision might have on acts done in reliance of the validity of those presidential decrees which were
published only during the pendency of this petition, have put the question as to whether the Court's declaration
of invalidity apply to P.D.s which had been enforced or implemented prior to their publication. The answer is
all too familiar. In similar situations in the past this Court had taken the pragmatic and realistic course set forth
in Chicot County Drainage District vs. Baxter Bank 8 to wit:
The courts below have proceeded on the theory that the Act of Congress, having been found to
be unconstitutional, was not a law; that it was inoperative, conferring no rights and imposing no
duties, and hence affording no basis for the challenged decree. Norton v. Shelby County, 118
U.S. 425, 442; Chicago, 1. & L. Ry. Co. v. Hackett, 228 U.S. 559, 566. It is quite clear, however,
that such broad statements as to the effect of a determination of unconstitutionality must be taken
with qualifications. The actual existence of a statute, prior to such a determination, is an
operative fact and may have consequences which cannot justly be ignored. The past cannot
always be erased by a new judicial declaration. The effect of the subsequent ruling as to

invalidity may have to be considered in various aspects-with respect to particular conduct,

private and official. Questions of rights claimed to have become vested, of status, of prior
determinations deemed to have finality and acted upon accordingly, of public policy in the light
of the nature both of the statute and of its previous application, demand examination. These
questions are among the most difficult of those which have engaged the attention of courts, state
and federal and it is manifest from numerous decisions that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be justified.
Consistently with the above principle, this Court in Rutter vs. Esteban 9 sustained the right of a party under the
Moratorium Law, albeit said right had accrued in his favor before said law was declared unconstitutional by this
Court.
Similarly, the implementation/enforcement of presidential decrees prior to their publication in the Official
Gazette is "an operative fact which may have consequences which cannot be justly ignored. The past cannot
always be erased by a new judicial declaration ... that an all-inclusive statement of a principle of absolute
retroactive invalidity cannot be justified."
From the report submitted to the Court by the Clerk of Court, it appears that of the presidential decrees sought
by petitioners to be published in the Official Gazette, only Presidential Decrees Nos. 1019 to 1030, inclusive,
1278, and 1937 to 1939, inclusive, have not been so published. 10 Neither the subject matters nor the texts of
these PDs can be ascertained since no copies thereof are available. But whatever their subject matter may be, it
is undisputed that none of these unpublished PDs has ever been implemented or enforced by the government.
In Pesigan vs. Angeles, 11 the Court, through Justice Ramon Aquino, ruled that "publication is necessary to
apprise the public of the contents of [penal] regulations and make the said penalties binding on the persons
affected thereby. " The cogency of this holding is apparently recognized by respondent officials considering the
manifestation in their comment that "the government, as a matter of policy, refrains from prosecuting violations
of criminal laws until the same shall have been published in the Official Gazette or in some other publication,
even though some criminal laws provide that they shall take effect immediately.
WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished
presidential issuances which are of general application, and unless so published, they shall have no binding
force and effect.
SO ORDERED.
Relova, J., concurs.
Aquino, J., took no part.
Concepcion, Jr., J., is on leave.

Separate Opinions

FERNANDO, C.J., concurring (with qualification):

There is on the whole acceptance on my part of the views expressed in the ably written opinion of Justice
Escolin. I am unable, however, to concur insofar as it would unqualifiedly impose the requirement of
publication in the Official Gazette for unpublished "presidential issuances" to have binding force and effect.
I shall explain why.
1. It is of course true that without the requisite publication, a due process question would arise if made to apply
adversely to a party who is not even aware of the existence of any legislative or executive act having the force
and effect of law. My point is that such publication required need not be confined to the Official Gazette. From
the pragmatic standpoint, there is an advantage to be gained. It conduces to certainty. That is too be admitted. It
does not follow, however, that failure to do so would in all cases and under all circumstances result in a statute,
presidential decree or any other executive act of the same category being bereft of any binding force and effect.
To so hold would, for me, raise a constitutional question. Such a pronouncement would lend itself to the
interpretation that such a legislative or presidential act is bereft of the attribute of effectivity unless published in
the Official Gazette. There is no such requirement in the Constitution as Justice Plana so aptly pointed out. It is
true that what is decided now applies only to past "presidential issuances". Nonetheless, this clarification is, to
my mind, needed to avoid any possible misconception as to what is required for any statute or presidential act to
be impressed with binding force or effectivity.
2. It is quite understandable then why I concur in the separate opinion of Justice Plana. Its first paragraph sets
forth what to me is the constitutional doctrine applicable to this case. Thus: "The Philippine Constitution does
not require the publication of laws as a prerequisite for their effectivity, unlike some Constitutions elsewhere. It
may be said though that the guarantee of due process requires notice of laws to affected Parties before they can
be bound thereby; but such notice is not necessarily by publication in the Official Gazette. The due process
clause is not that precise. 1 I am likewise in agreement with its closing paragraph: "In fine, I concur in the
majority decision to the extent that it requires notice before laws become effective, for no person should be
bound by a law without notice. This is elementary fairness. However, I beg to disagree insofar as it holds that
such notice shall be by publication in the Official Gazette. 2
3. It suffices, as was stated by Judge Learned Hand, that law as the command of the government "must be
ascertainable in some form if it is to be enforced at all. 3 It would indeed be to reduce it to the level of mere
futility, as pointed out by Justice Cardozo, "if it is unknown and unknowable. 4 Publication, to repeat, is thus
essential. What I am not prepared to subscribe to is the doctrine that it must be in the Official Gazette. To be
sure once published therein there is the ascertainable mode of determining the exact date of its effectivity. Still
for me that does not dispose of the question of what is the jural effect of past presidential decrees or executive
acts not so published. For prior thereto, it could be that parties aware of their existence could have conducted
themselves in accordance with their provisions. If no legal consequences could attach due to lack of publication
in the Official Gazette, then serious problems could arise. Previous transactions based on such "Presidential
Issuances" could be open to question. Matters deemed settled could still be inquired into. I am not prepared to
hold that such an effect is contemplated by our decision. Where such presidential decree or executive act is
made the basis of a criminal prosecution, then, of course, its ex post facto character becomes evident. 5 In civil
cases though, retroactivity as such is not conclusive on the due process aspect. There must still be a showing of
arbitrariness. Moreover, where the challenged presidential decree or executive act was issued under the police
power, the non-impairment clause of the Constitution may not always be successfully invoked. There must still
be that process of balancing to determine whether or not it could in such a case be tainted by infirmity. 6 In
traditional terminology, there could arise then a question of unconstitutional application. That is as far as it
goes.
4. Let me make therefore that my qualified concurrence goes no further than to affirm that publication is
essential to the effectivity of a legislative or executive act of a general application. I am not in agreement with
the view that such publication must be in the Official Gazette. The Civil Code itself in its Article 2 expressly
recognizes that the rule as to laws taking effect after fifteen days following the completion of their publication

in the Official Gazette is subject to this exception, "unless it is otherwise provided." Moreover, the Civil Code is
itself only a legislative enactment, Republic Act No. 386. It does not and cannot have the juridical force of a
constitutional command. A later legislative or executive act which has the force and effect of law can legally
provide for a different rule.
5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice Escolin that presidential decrees
and executive acts not thus previously published in the Official Gazette would be devoid of any legal character.
That would be, in my opinion, to go too far. It may be fraught, as earlier noted, with undesirable consequences.
I find myself therefore unable to yield assent to such a pronouncement.
I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and Alampay concur in this separate
opinion.
Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.

TEEHANKEE, J., concurring:

I concur with the main opinion of Mr. Justice Escolin and the concurring opinion of Mme. Justice Herrera. The
Rule of Law connotes a body of norms and laws published and ascertainable and of equal application to all
similarly circumstances and not subject to arbitrary change but only under certain set procedures. The Court has
consistently stressed that "it is an elementary rule of fair play and justice that a reasonable opportunity to be
informed must be afforded to the people who are commanded to obey before they can be punished for its
violation, 1 citing the settled principle based on due process enunciated in earlier cases that "before the public is
bound by its contents, especially its penal provisions, a law, regulation or circular must first be published and
the people officially and specially informed of said contents and its penalties.
Without official publication in the Official Gazette as required by Article 2 of the Civil Code and the Revised
Administrative Code, there would be no basis nor justification for the corollary rule of Article 3 of the Civil
Code (based on constructive notice that the provisions of the law are ascertainable from the public and official
repository where they are duly published) that "Ignorance of the law excuses no one from compliance therewith.
Respondents' contention based on a misreading of Article 2 of the Civil Code that "only laws which are silent as
to their effectivity [date] need be published in the Official Gazette for their effectivity" is manifestly untenable.
The plain text and meaning of the Civil Code is that "laws shall take effect after fifteen days following the
completion of their publication in the Official Gazette, unless it is otherwise provided, " i.e. a different
effectivity date is provided by the law itself. This proviso perforce refers to a law that has been duly published
pursuant to the basic constitutional requirements of due process. The best example of this is the Civil Code
itself: the same Article 2 provides otherwise that it "shall take effect [only] one year [not 15 days] after such
publication. 2 To sustain respondents' misreading that "most laws or decrees specify the date of their effectivity
and for this reason, publication in the Official Gazette is not necessary for their effectivity 3 would be to nullify
and render nugatory the Civil Code's indispensable and essential requirement of prior publication in the Official
Gazette by the simple expedient of providing for immediate effectivity or an earlier effectivity date in the law
itself before the completion of 15 days following its publication which is the period generally fixed by the Civil
Code for its proper dissemination.

MELENCIO-HERRERA, J., concurring:

I agree. There cannot be any question but that even if a decree provides for a date of effectivity, it has to be
published. What I would like to state in connection with that proposition is that when a date of effectivity is
mentioned in the decree but the decree becomes effective only fifteen (15) days after its publication in the
Official Gazette, it will not mean that the decree can have retroactive effect to the date of effectivity mentioned
in the decree itself. There should be no retroactivity if the retroactivity will run counter to constitutional rights
or shall destroy vested rights.

PLANA, J., concurring (with qualification):

The Philippine Constitution does not require the publication of laws as a prerequisite for their effectivity, unlike
some Constitutions elsewhere. * It may be said though that the guarantee of due process requires notice of laws
to affected parties before they can be bound thereby; but such notice is not necessarily by publication in the
Official Gazette. The due process clause is not that precise. Neither is the publication of laws in the Official
Gazette required by any statute as a prerequisite for their effectivity, if said laws already provide for their
effectivity date.
Article 2 of the Civil Code provides that "laws shall take effect after fifteen days following the completion of
their publication in the Official Gazette, unless it is otherwise provided " Two things may be said of this
provision: Firstly, it obviously does not apply to a law with a built-in provision as to when it will take effect.
Secondly, it clearly recognizes that each law may provide not only a different period for reckoning its
effectivity date but also a different mode of notice. Thus, a law may prescribe that it shall be published
elsewhere than in the Official Gazette.
Commonwealth Act No. 638, in my opinion, does not support the proposition that for their effectivity, laws
must be published in the Official Gazette. The said law is simply "An Act to Provide for the Uniform
Publication and Distribution of the Official Gazette." Conformably therewith, it authorizes the publication of
the Official Gazette, determines its frequency, provides for its sale and distribution, and defines the authority of
the Director of Printing in relation thereto. It also enumerates what shall be published in the Official Gazette,
among them, "important legislative acts and resolutions of a public nature of the Congress of the Philippines"
and "all executive and administrative orders and proclamations, except such as have no general applicability." It
is noteworthy that not all legislative acts are required to be published in the Official Gazette but only
"important" ones "of a public nature." Moreover, the said law does not provide that publication in the Official
Gazette is essential for the effectivity of laws. This is as it should be, for all statutes are equal and stand on the
same footing. A law, especially an earlier one of general application such as Commonwealth Act No. 638,
cannot nullify or restrict the operation of a subsequent statute that has a provision of its own as to when and
how it will take effect. Only a higher law, which is the Constitution, can assume that role.
In fine, I concur in the majority decision to the extent that it requires notice before laws become effective, for no
person should be bound by a law without notice. This is elementary fairness. However, I beg to disagree insofar
as it holds that such notice shall be by publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.

GUTIERREZ, Jr., J., concurring:

I concur insofar as publication is necessary but reserve my vote as to the necessity of such publication being in
the Official Gazette.

DE LA FUENTE, J., concurring:

I concur insofar as the opinion declares the unpublished decrees and issuances of a public nature or general
applicability ineffective, until due publication thereof.

Separate Opinions
FERNANDO, C.J., concurring (with qualification):
There is on the whole acceptance on my part of the views expressed in the ably written opinion of Justice
Escolin. I am unable, however, to concur insofar as it would unqualifiedly impose the requirement of
publication in the Official Gazette for unpublished "presidential issuances" to have binding force and effect.
I shall explain why.
1. It is of course true that without the requisite publication, a due process question would arise if made to apply
adversely to a party who is not even aware of the existence of any legislative or executive act having the force
and effect of law. My point is that such publication required need not be confined to the Official Gazette. From
the pragmatic standpoint, there is an advantage to be gained. It conduces to certainty. That is too be admitted. It
does not follow, however, that failure to do so would in all cases and under all circumstances result in a statute,
presidential decree or any other executive act of the same category being bereft of any binding force and effect.
To so hold would, for me, raise a constitutional question. Such a pronouncement would lend itself to the
interpretation that such a legislative or presidential act is bereft of the attribute of effectivity unless published in
the Official Gazette. There is no such requirement in the Constitution as Justice Plana so aptly pointed out. It is
true that what is decided now applies only to past "presidential issuances". Nonetheless, this clarification is, to
my mind, needed to avoid any possible misconception as to what is required for any statute or presidential act to
be impressed with binding force or effectivity.
2. It is quite understandable then why I concur in the separate opinion of Justice Plana. Its first paragraph sets
forth what to me is the constitutional doctrine applicable to this case. Thus: "The Philippine Constitution does
not require the publication of laws as a prerequisite for their effectivity, unlike some Constitutions elsewhere. It
may be said though that the guarantee of due process requires notice of laws to affected Parties before they can
be bound thereby; but such notice is not necessarily by publication in the Official Gazette. The due process
clause is not that precise. 1 I am likewise in agreement with its closing paragraph: "In fine, I concur in the
majority decision to the extent that it requires notice before laws become effective, for no person should be
bound by a law without notice. This is elementary fairness. However, I beg to disagree insofar as it holds that
such notice shall be by publication in the Official Gazette. 2
3. It suffices, as was stated by Judge Learned Hand, that law as the command of the government "must be
ascertainable in some form if it is to be enforced at all. 3 It would indeed be to reduce it to the level of mere
futility, as pointed out by Justice Cardozo, "if it is unknown and unknowable. 4 Publication, to repeat, is thus
essential. What I am not prepared to subscribe to is the doctrine that it must be in the Official Gazette. To be
sure once published therein there is the ascertainable mode of determining the exact date of its effectivity. Still
for me that does not dispose of the question of what is the jural effect of past presidential decrees or executive
acts not so published. For prior thereto, it could be that parties aware of their existence could have conducted
themselves in accordance with their provisions. If no legal consequences could attach due to lack of publication
in the Official Gazette, then serious problems could arise. Previous transactions based on such "Presidential
Issuances" could be open to question. Matters deemed settled could still be inquired into. I am not prepared to

hold that such an effect is contemplated by our decision. Where such presidential decree or executive act is
made the basis of a criminal prosecution, then, of course, its ex post facto character becomes evident. 5 In civil
cases though, retroactivity as such is not conclusive on the due process aspect. There must still be a showing of
arbitrariness. Moreover, where the challenged presidential decree or executive act was issued under the police
power, the non-impairment clause of the Constitution may not always be successfully invoked. There must still
be that process of balancing to determine whether or not it could in such a case be tainted by infirmity. 6 In
traditional terminology, there could arise then a question of unconstitutional application. That is as far as it
goes.
4. Let me make therefore that my qualified concurrence goes no further than to affirm that publication is
essential to the effectivity of a legislative or executive act of a general application. I am not in agreement with
the view that such publication must be in the Official Gazette. The Civil Code itself in its Article 2 expressly
recognizes that the rule as to laws taking effect after fifteen days following the completion of their publication
in the Official Gazette is subject to this exception, "unless it is otherwise provided." Moreover, the Civil Code is
itself only a legislative enactment, Republic Act No. 386. It does not and cannot have the juridical force of a
constitutional command. A later legislative or executive act which has the force and effect of law can legally
provide for a different rule.
5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice Escolin that presidential decrees
and executive acts not thus previously published in the Official Gazette would be devoid of any legal character.
That would be, in my opinion, to go too far. It may be fraught, as earlier noted, with undesirable consequences.
I find myself therefore unable to yield assent to such a pronouncement.
I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and Alampay concur in this separate
opinion.
Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.

TEEHANKEE, J., concurring:

I concur with the main opinion of Mr. Justice Escolin and the concurring opinion of Mme. Justice Herrera. The
Rule of Law connotes a body of norms and laws published and ascertainable and of equal application to all
similarly circumstances and not subject to arbitrary change but only under certain set procedures. The Court has
consistently stressed that "it is an elementary rule of fair play and justice that a reasonable opportunity to be
informed must be afforded to the people who are commanded to obey before they can be punished for its
violation, 1 citing the settled principle based on due process enunciated in earlier cases that "before the public is
bound by its contents, especially its penal provisions, a law, regulation or circular must first be published and
the people officially and specially informed of said contents and its penalties.
Without official publication in the Official Gazette as required by Article 2 of the Civil Code and the Revised
Administrative Code, there would be no basis nor justification for the corollary rule of Article 3 of the Civil
Code (based on constructive notice that the provisions of the law are ascertainable from the public and official
repository where they are duly published) that "Ignorance of the law excuses no one from compliance therewith.
Respondents' contention based on a misreading of Article 2 of the Civil Code that "only laws which are silent as
to their effectivity [date] need be published in the Official Gazette for their effectivity" is manifestly untenable.
The plain text and meaning of the Civil Code is that "laws shall take effect after fifteen days following the
completion of their publication in the Official Gazette, unless it is otherwise provided, " i.e. a different
effectivity date is provided by the law itself. This proviso perforce refers to a law that has been duly published
pursuant to the basic constitutional requirements of due process. The best example of this is the Civil Code

itself: the same Article 2 provides otherwise that it "shall take effect [only] one year [not 15 days] after such
publication. 2 To sustain respondents' misreading that "most laws or decrees specify the date of their effectivity
and for this reason, publication in the Official Gazette is not necessary for their effectivity 3 would be to nullify
and render nugatory the Civil Code's indispensable and essential requirement of prior publication in the Official
Gazette by the simple expedient of providing for immediate effectivity or an earlier effectivity date in the law
itself before the completion of 15 days following its publication which is the period generally fixed by the Civil
Code for its proper dissemination.

MELENCIO-HERRERA, J., concurring:

I agree. There cannot be any question but that even if a decree provides for a date of effectivity, it has to be
published. What I would like to state in connection with that proposition is that when a date of effectivity is
mentioned in the decree but the decree becomes effective only fifteen (15) days after its publication in the
Official Gazette, it will not mean that the decree can have retroactive effect to the date of effectivity mentioned
in the decree itself. There should be no retroactivity if the retroactivity will run counter to constitutional rights
or shall destroy vested rights.

PLANA, J., concurring (with qualification):

The Philippine Constitution does not require the publication of laws as a prerequisite for their effectivity, unlike
some Constitutions elsewhere. * It may be said though that the guarantee of due process requires notice of laws
to affected parties before they can be bound thereby; but such notice is not necessarily by publication in the
Official Gazette. The due process clause is not that precise. Neither is the publication of laws in the Official
Gazette required by any statute as a prerequisite for their effectivity, if said laws already provide for their
effectivity date.
Article 2 of the Civil Code provides that "laws shall take effect after fifteen days following the completion of
their publication in the Official Gazette, unless it is otherwise provided " Two things may be said of this
provision: Firstly, it obviously does not apply to a law with a built-in provision as to when it will take effect.
Secondly, it clearly recognizes that each law may provide not only a different period for reckoning its
effectivity date but also a different mode of notice. Thus, a law may prescribe that it shall be published
elsewhere than in the Official Gazette.
Commonwealth Act No. 638, in my opinion, does not support the proposition that for their effectivity, laws
must be published in the Official Gazette. The said law is simply "An Act to Provide for the Uniform
Publication and Distribution of the Official Gazette." Conformably therewith, it authorizes the publication of
the Official Gazette, determines its frequency, provides for its sale and distribution, and defines the authority of
the Director of Printing in relation thereto. It also enumerates what shall be published in the Official Gazette,
among them, "important legislative acts and resolutions of a public nature of the Congress of the Philippines"
and "all executive and administrative orders and proclamations, except such as have no general applicability." It
is noteworthy that not all legislative acts are required to be published in the Official Gazette but only
"important" ones "of a public nature." Moreover, the said law does not provide that publication in the Official
Gazette is essential for the effectivity of laws. This is as it should be, for all statutes are equal and stand on the
same footing. A law, especially an earlier one of general application such as Commonwealth Act No. 638,
cannot nullify or restrict the operation of a subsequent statute that has a provision of its own as to when and
how it will take effect. Only a higher law, which is the Constitution, can assume that role.

In fine, I concur in the majority decision to the extent that it requires notice before laws become effective, for no
person should be bound by a law without notice. This is elementary fairness. However, I beg to disagree insofar
as it holds that such notice shall be by publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.

GUTIERREZ, Jr., J., concurring:

I concur insofar as publication is necessary but reserve my vote as to the necessity of such publication being in
the Official Gazette.

DE LA FUENTE, J., concurring:

I concur insofar as the opinion declares the unpublished decrees and issuances of a public nature or general
applicability ineffective, until due publication thereof.

EXECUTIVE ORDER NO. 200 June 18, 1987

PROVIDING FOR THE PUBLICATION OF LAWS EITHER IN THE OFFICIAL GAZETTE OR IN A
NEWSPAPER OF GENERAL CIRCULATION IN THE PHILIPPINES AS A REQUIREMENT FOR
THEIR EFFECTIVITY
WHEREAS, Article 2 of the Civil Code partly provides that "laws shall take effect after fifteen days following
the completion of their publication in the Official Gazette, unless it is otherwise provided . . .;"
WHEREAS, the requirement that for laws to be effective only a publication thereof in the Official Gazette will
suffice has entailed some problems, a point recognized by the Supreme Court in Taada. et al. vs. Tuvera, et al.
(G.R. No. 63915, December 29, 1986) when it observed that "[t]here is much to be said of the view that the
publication need not be made in the Official Gazette, considering its erratic release and limited readership";
WHEREAS, it was likewise observed that "[u]ndoubtedly, newspapers of general circulation could better
perform the function of communicating the laws to the people as such periodicals are more easily available,
have a wider readership, and come out regularly"; and
WHEREAS, in view of the foregoing premises Article 2 of the Civil Code should accordingly be amended so
the laws to be effective must be published either in the Official Gazette or in a newspaper of general circulation
in the country;
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, by virtue of the powers vested
in me by the Constitution, do hereby order:
Sec. 1. Laws shall take effect after fifteen days following the completion of their publication either in the
Official Gazette or in a newspaper of general circulation in the Philippines, unless it is otherwise provided.
Sec. 2. Article 2 of Republic Act No. 386, otherwise known as the "Civil Code of the Philippines," and all other
laws inconsistent with this Executive Order are hereby repealed or modified accordingly.
Sec. 3. This Executive Order shall take effect immediately after its publication in the Official Gazette.
Done in the City of Manila, this 18th day of June, in the year of Our Lord, nineteen hundred and eighty-seven.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 157286

June 16, 2006

THE PUBLIC SCHOOLS DISTRICT SUPERVISORS ASSOCIATION (PSDSA), its officers, to wit:
DR. ANILLA A. CALAMBA, President; DR. CARMELITA L. PALABAY, Gen. Vice-President; MS.
ESTELITA R. REYES, Board Secretary; DR. THELMA A. GALANG, Asst. Board Secretary; MR.
FERNANDO LAVITA, Treasurer; MS. LITA DIONISIO, Asst. Treasurer; MS. ROSELILY PADRE,
Auditor; MR. ROMAN CALICDAN, Asst. Auditor; MR. TOMO-AY, MR. OSCAR PEAFLORIDA,
Bus. Managers; DR. ANTONETTE ANG, DR. MAGNITA LABRADOR, P.R.O.S; MR. BONIFACIO
MIGUEL (Region I), MR. JOSE CALAGUI (Region II), DR. REYNALDO SAGUM (Region III), MR.
RUBEN PANAHON (Region IV), MR. OSCAR BARBA (Region V), MS. IRMA GANELA (Region VI),
DR. ERLINDA NAPULI (Region VII), DR. PONCIANO GABIETA (Region VIII), MR. FEDERICO
FIDEL (Region IX), MR.EMILIANO V. RODRIGUEZ (Region X), MS. EDWINA ALAG (Region XI),
MR. DOMINADOR ATAM (Region XII), MS. CONSUELO VELASCO (NCR), MR. VICTORINO
AGMATA (CAR), MS. NATIVIDAD SALASAB (ARMM-CARAGA), All PSDSA Vice-Presidents for
their respective Regions: DR. LOLITA CABANAYAN, MR. CICERO AKLANG, DR. RUSTICO
OCAMPO, MR. ROMEO SANTOS, MR. EMMANUEL CAMA, MR. ROMEO TUMAOB, MR.
JOVENCIO MENDOZA, MR. ALEJANDRO BARING, JR., MS. BERNARDITA APOSTOL, MS.
LORETA MACALUDAS, DR. MYRNA LYN MARACON, MS. ELIZABETH SAN DIEGO, SITH
HINDRON DAMMANG, MS. IMMACULADA BRINGAS, and MS. GLORIA DERECHO, all members
of the PSDSA Board of Directors, in their own behalf as current District Supervisors and IN
REPRESENTATION OF ALL DISTRICT SUPERVISORS OF THE DEPARTMENT OF
EDUCATION, Petitioners,
vs.
HON. EDILBERTO C. DE JESUS, Department Secretary, THE DEPARTMENT OF EDUCATION, and
THE DEPARTMENT OF BUDGET AND MANAGEMENT, Respondents.
DECISION
CALLEJO, SR., J.:
This is a Petition for Prohibition with prayer for temporary restraining order and/or preliminary injunction filed
by the Public Schools District Supervisor Association (PSDSA) seeking to declare as unconstitutional Rule IV,
Section 4.3; Rule V, Sections 5.1 and the second paragraph of Section 5.2; and Rule VI, Section 6.2, paragraph
11 of Department of Education Order No. 1, Series of 2003. The petition likewise seeks to compel, by way of a
writ of mandamus, the Department of Education, Culture, and Sports (DECS) and the Department of Budget
and Management (DBM) to upgrade the salary grade level of the district supervisors from Salary Grade (SG) 19
to SG 24.
The Antecedents
Ever since the Department of Education (DepEd)1 was founded decades ago, its management had been so
centralized in the Manila office. Schools in the national, regional, and division levels merely followed and
implemented the orders and memoranda issued by the Education Secretary. Due to the evolution of the learning
process and the onset of information technology, there was a need for a radical change in the governance of the
DepEd. Thus, a study on how to improve the management of the Department was conducted, and one of the
proposals was the abolition of the office of the district supervisor.

Then Senator Tessie Aquino-Oreta, the Chairman of the Committee on Education, authored Senate Bill No.
2191, the thrust of which was to change the existing management style and focus on the schools where the
teaching-learning process occurs. The bill was intended to highlight shared governance in the different levels in
the DECS hierarchy and establish authority, accountability, and responsibility for achieving higher learning
outcomes. While the governance of basic education would begin at the national level, the field offices (regions,
divisions, schools, and learning centers) would translate the policy into programs, projects, and services to fit
local needs.2 The national level was likewise to be tasked to define the roles and responsibilities of, and provide
resources to the field offices which would implement educational programs, projects, and services in
communities they serve.3 At the forefront would be the DepEd Secretary, vested with the overall authority and
supervision over the operations of the department on the national, regional, division, and schools district level. 4
Republic Act No. 9155, otherwise known as the "Governance of Basic Education Act 2001," became a law on
August 11, 2001, in accordance with Section 27(1), Article VI of the Constitution. Under the law, each regional
office shall have a director, an assistant director, and an office staff for program promotion and support,
planning, administrative and fiscal services.5 The regional director was given the authority to hire, place and
evaluate all employees in the regional office except for the position of assistant director,6 as well as the
authority, accountability, and responsibility to determine the organization component of the divisions and
districts, and approve the staffing pattern of all employees therein;7 evaluate all division superintendents and
assistant division superintendents in the region;8 and other functions as may be assigned by the proper
authorities.9
A division, on the other hand, is headed by a schools division superintendent with the following responsibilities,
among others: to supervise the operations of all public and private elementary, secondary, and integrated
schools, and learning centers;10 to hire, place and evaluate all division supervisors and schools district
supervisors as well as all employees in the divisions, both teaching and non-teaching personnel, including
school heads, except for the assistant division superintendent; 11 and perform other functions as may be assigned
by proper authorities.12
The office of the schools district supervisor has been retained under the law. Each district is headed by a school
district supervisor and an office staff for program promotion. However, the responsibilities of the schools
district supervisor are limited to the following: (1) providing professional and instructional advice and support
to the school heads and teachers/facilitators of schools and learning centers in the district or cluster thereof; (2)
curricula supervision; and (3) performing such other functions as may be assigned by proper authorities. The
schools district supervisors have no administrative, management, control or supervisory functions over the
schools and learning centers within their respective districts.13
On the school level, an Elementary School Principal (ESP) was designated as school head for all public
elementary schools; and a Secondary School Principal (SSP) for high schools or a cluster thereof. 14 The ESP
and the SSP serve as both instructional leaders and administrative managers with the following authority,
accountability and responsibility:
(7) Administering and managing all personnel, physical, and fiscal resources of the school;
(8) Recommending the staffing complement of the school based on its needs;
(9) Encouraging staff development;
xxxx
(11) Accepting donations, gifts, bequests, and grants for the purpose of upgrading teachers/learning
facilitators competencies, improving and expanding school facilities, and providing instructional

materials and equipment. Such donations or grants must be reported to the appropriate district
supervisors and division superintendents; and
(12) Performing such other functions as may be assigned by proper authorities. 15
Under Section 14 of the law, the DepEd Secretary is mandated to "promulgate the implementing rules and
regulations within ninety (90) days after the approval of the Act, provided that the principle of shared
governance shall be fully implemented within two (2) years" after such approval.
Before the DepEd could issue the appropriate implementing rules and regulations, petitioner sought the legal
assistance of the Integrated Bar of the Philippines (IBP) National Committee on Legal Aid to make
representations for the resolution of the following administrative issues:
1. Restoration of the functions, duties, responsibilities, benefits, prerogatives, and position level of
Public Schools District Supervisors.
2. Upgrading of Salary Grade level of Public Schools District Supervisors from Salary Grade Level 19
to Salary Grade Level 24 under DBM Circular No. 36, otherwise known as the Compensation and
Position Classification Rules and Regulation.16
In a Letter dated March 1, 2002 addressed to then DepEd Secretary Raul Roco, the IBP stated that, per its
review of the documents submitted by the PSDSA, it found the latters position valid and legal, to wit:
First: The basis for the abolition of the position of District Supervisors under the Attrition Law and DECS
Department Order No. 110, Series of 1991 is no longer valid and rendered moot and academic due to issuance
of DECS Department Order No. 22, Series of 1996 and the passage by Congress of the Philippines of Republic
Act No. 9155, otherwise known as the Basic Education Governance Act of 2000. Under R.A. 9155, school
districts are mandated to be maintained and responsibilities of Public Schools Districts Supervisors have been
clearly defined.
Second: There is a clear case of discrimination of grant of salaries and benefits to District Supervisors compared
to salaries and benefits received by the School Principals which position is lower in the hierarchy of positions
as prepared by the Department of Education and the Department of Budget and Management. School Principals
and District Supervisors enjoy the same level of Salary Grade even if the latter position is considered as a
promotion and enjoys a higher level of position than that of the position of School Principals. 17
The PSDSA thus requested the DepEd Secretary to call an immediate consultation with the district supervisors
nationwide through a convention, and their valid inputs be considered in formulating the rules and regulations
to be urged by the DepEd. However, the Secretary failed to reply. Thus, the IBP reiterated the concerns raised
by the PSDSA in a Letter18 to the DepEd dated April 15, 2002.
On January 6, 2003, DepEd Secretary Edilberto C. De Jesus issued DECS Office Order No. 1, which constitutes
the Implementing Rules and Regulations (IRR) of R.A. No. 9155. Sections 4.1 to 4.3, Rule IV of the IRR
provide:
SECTION 4.1. The Schools Division Superintendent. A division shall consist of a province or city which shall
have a schools division superintendent. There shall be at least one assistant schools division superintendent and
office staff for programs promotion, planning, administrative, fiscal, legal, ancillary, and other support services.
SECTION 4.2. Authority, Accountability, and Responsibility of the Schools Division Superintendent.
Consistent with the national educational policies, plans, and standards, the schools division superintendents
shall have authority, accountability, and responsibility for the following:

1) Developing and implementing division education development plans;

2) Planning and managing the effective and efficient performance of all personnel, physical, and fiscal
resources of the division, including professional staff development;
3) Hiring, placing, and evaluating all division supervisors and schools district supervisors as well as all
employees in the division, both teaching and non-teaching personnel, including school heads, except for
the assistant division superintendents;
4) Monitoring the utilization of funds provided by the national government and the local government
units to the schools and learning centers;
5) Ensuring compliance of quality standards for basic education programs and for this purpose
strengthening the role of division supervisors as subject area specialists;
6) Promoting awareness of, and adherence by, all schools and learning centers to accreditation standards
prescribed by the Secretary of Education;
7) Supervising the operations of all public and private elementary, secondary, and integrated schools,
and learning centers; and
8) Performing such other functions as may be assigned by the Secretary and/or Regional Director.
SECTION 4.3. Appointing and Disciplinary Authority of the Schools Division Superintendent. The schools
district superintendent shall appoint the division supervisors and school district supervisors as well as all
employees in the division, both teaching and non-teaching personnel, including school heads, except for the
assistant schools division superintendent, subject to the civil service laws, rules and regulations, and the policies
and guidelines to be issued by the Secretary of Education for the purpose.
The schools division superintendent shall have disciplinary authority only over the non-teaching personnel
under his jurisdiction.
Such exercise of disciplinary authority by the schools division superintendent over the non-teaching personnel
shall be subject to the civil service laws, rules and regulations, and procedures and guidelines to be issued by
the Secretary of Education relative to this matter.
The Regional Director shall continue exercising disciplinary authority over the teaching personnel insofar as the
latter are covered by specific and exclusive disciplinary provisions under the Magna Carta for Public School
Teachers (R.A. No. 4670).19
Sections 5.1 and 5.2, Rule V of the IRR, in turn, provide:
SECTION 5.1. The Schools District Supervisor. A school district shall have a school district supervisor and
office staff for program promotion.
The schools district supervisor shall primarily perform staff functions and shall not exercise administrative
supervision over school principals, unless specifically authorized by the proper authorities. The main focus of
his/her functions shall be instructional and curricula supervision aimed at raising academic standards at the
school level.
The schools district supervisor shall be specifically responsible for:

1) Providing professional and instructional advice and support to the school heads and
teachers/facilitators of schools and learning centers in the district or cluster thereof;
2) Curricula supervision; and
3) Performing such other functions as may be assigned by the Secretary, Regional Directors, and
Schools Division Superintendents where they belong.
The schools district supervisor being mentioned in this section shall refer to a public schools district supervisor.
SECTION 5.2. The School District. A school district already existing at the time of the passage of this Act
shall be maintained. However, an additional school district may be established by the regional director based on
criteria set by the Secretary and on the recommendation of the schools division superintendent. For this purpose,
the Secretary of Education shall set standards and formulate criteria as basis of the Regional Directors of the
establishment of an additional school district.20
On March 13, 2003, the PSDSA, the national organization of about 1,800 public school district supervisors of
the DepEd, in behalf of its officers and members, filed the instant petition for prohibition and mandamus,
alleging that:
I. THE ACT OF THE DEPARTMENT OF EDUCATION IN REMOVING PETITIONERS
ADMINISTRATIVE SUPERVISION OVER ELEMENTARY SCHOOLS AND ITS PRINCIPALS (SCHOOL
HEADS) WITHIN HIS/HER DISTRICT AND CONVERTING HIS/HER ADMINISTRATIVE FUNCTION
TO THAT OF PERFORMING STAFF FUNCTION FOR THE DIVISION OFFICE PER SECTION 5.1 RULE
V OF THE IMPLEMENTING RULES AND REGULATIONS OF REPUBLIC ACT 9155 (DEPED ORDER
NO. 1, SERIES OF 2003) IS A GROSS VIOLATION OF REPUBLIC ACT 9155 THE GOVERNANCE OF
BASIC EDUCATION ACT OF 2001.
II. THE IMPLEMENTING RULES AND REGULATION OF REPUBLIC ACT 9155 AS PROMULGATED
UNDER DEPED ORDER NO. 1, SERIES OF 2003 EXPANDED THE LAW AND INCLUDED
PROVISIONS WHICH ARE DIAMETRICALLY OPPOSED TO THE LETTER AND SPIRIT OF THE
SUBJECT LAW.
III. THE DOWNGRADING OF SALARY GRADE LEVEL OF THE PUBLIC SCHOOLS DISTRICT
SUPERVISOR OR THE NEGLECT OR REFUSAL OF THE DEPARTMENT OF EDUCATION AND THE
DEPARTMENT OF BUDGET AND MANAGEMENT TO UPGRADE THE SALARY GRADE LEVEL OF
PUBLIC SCHOOLS DISTRICT TO A RESPECTABLE LEVEL OF SALARY GRADE HIGHER THAN
THAT OF THE PRINCIPALS DESPITE CLEAR INTENTION OF R.A. 9155 TO RETAIN THE POSITION
OF PSDS IN THE HIERARCHY OF ADMINISTRATIVE MANAGERS AND OFFICERS OF THE
DEPARTMENT OF EDUCATION IS UNCONSTITUTIONAL AND ILLEGAL.21
Petitioners maintain that the questioned provisions of the IRR are invalid because they "extended or expanded
and modified" the provisions of R.A. No. 9155. They argue that the said law should be read in harmony with
other "existing educational laws" which it did not specifically repeal, such as Batas Pambansa Blg. 232,
otherwise known as "The Education Act of 1982," as amended by R.A. No. 7798; R.A. No. 4670, otherwise
known as the "Magna Charta for Public School Teachers"; and R.A. No. 7784 captioned "An Act to Strengthen
Teacher Education in the Philippines by Establishing Centers of Excellence, Creating a Teacher Education
Council for the Purpose, Appropriating Funds Therefore, and for Other Purposes."
Petitioners assert that under Section 7(D) of R.A. No. 9155, the district offices of the DepEd are intended as
field offices where the district supervisors can assist the ESPs and teachers/learning facilitators within their
district as experienced educational managers. Thus, the district supervisors were not divested of the inherent

administrative functions to manage and oversee the schools within their respective districts, including their
subordinates. They emphasize that the law provides an "office staff for program promotion" in the school
districts, which would be of no use if the office has no administrative supervision over schools within its
respective districts.
Petitioners assert that under the IRR, the schools district supervisors primarily perform staff functions and shall
not exercise administrative supervision over school principals, unless specifically authorized by the proper
authorities. Thus, under the IRR, the exercise of administrative supervision over school principals was made
discretionary and subject to the whims and caprices of "the proper authorities." The logical inference of this
provision, petitioners aver, is that the administrative supervisory powers can be withdrawn from a district
supervisor without any reason at all, a provision which has no basis in the enabling law.
Petitioners further contend that the DepEd has no authority to incorporate its plan of downgrading the position
of district supervisor, that is, from being an administrator of a particular district office to a position performing a
staff function, to exercise administrative supervision over the school principals only when specifically
authorized by proper authorities. Petitioners insist that respondent Education Secretary was focused on
removing the level of management in the district office, such that the IRR empower school heads (principals) to
have administrative and instructional supervision of school or cluster of schools, while supervision of all public
and private elementary, secondary, and integrated schools and learning centers was given to the division office.
Petitioners further insist that respondent Education Secretary failed to consider the fact that R.A. No. 9155
strengthened the district office as a mid-level administrative field office of the DepEd. The law even mandates
to allow the district supervisor to have an office staff for program promotion in the district office. Apart from
the current administrative functions inherent in the district office, DECS Service Manual 2000 vested additional
specific functions to the district offices, to provide professional and instructional advice and support to the
school heads and teachers/facilitators of schools and learning centers in the district, as well as curricula
supervision.
Petitioners posit that R.A. No. 9155 did not, in anyway, allow or authorize the reorganization of the entire
DepEd; it never reduced the position, rank, classification, and salary grade level of district supervisors, nor
abolished the district offices which are responsible for the administration and management of elementary
schools within its jurisdiction. It did not remove from the district supervisors the function of administrative
supervision over schools within their respective areas. In fact, petitioners insist, what the law did was to give the
district supervisor additional responsibility of providing professional and instructional advice and support to the
school heads and teachers/facilitators of schools and learning centers in the district or cluster thereof.
Petitioners point out that under Section 4.3, paragraph (b), Rule IV of the IRR, the schools division
superintendent was given the power to appoint the division supervisors and schools district supervisor and other
employees subject to civil service laws, rules, and regulations, and the policies and guidelines to be issued by
the Secretary of Education for the purpose. On the other hand, the school division superintendent shall have
disciplinary authority only over the non-teaching personnel under his jurisdiction. Such exercise of disciplinary
authority by the schools division superintendent over the non-teaching personnel shall be subject to civil service
laws, rules, and regulations, and procedures and guidelines to be issued by the Secretary of Education relative to
this matter. The regional director shall continue exercising disciplinary authority over the teaching personnel in
so far as the latter are covered by specific and exclusive disciplinary provisions under the Magna Carta for
Public School Teachers (R.A. 4670).
Petitioners posit that this grant of disciplining authority to the regional director for teaching personnel who
commit violations of laws, rules, and regulations is definitely not provided for in R.A. No. 9155. The division
superintendent was given the power not only to hire and appoint the division supervisors, district supervisors,
school heads, or principals as well as employees in the division, both teaching and non-teaching positions.
However, when it comes to disciplining officers and teaching personnel who commit infractions or violations of

law, rules, and regulations of the DepEd, the exercise of such disciplining authority is lodged in the hands of the
regional director. Petitioners point out that the power to hire teachers is in the hands of the division
superintendent; principles of administrative rules and procedure provide that the authority to hire and appoint
carries with it the authority to discipline and fire the hired and appointed personnel particularly if the law is
silent thereon. Since the division superintendent has the authority to hire teaching personnel within its division,
he/she should also take the responsibility of disciplining erring teachers and employees. If the set-up of placing
the power of hiring and power to discipline or fire an errant personnel is separated or divided between two
offices of the DepEd, the proliferation of "palakasan" or "bata-bata" system will flourish, to the detriment of the
public education system and public service.
Petitioners also point out that under Section 7(E)(11) of R.A. No. 9155, school heads are authorized to accept
gifts, donations, bequests, and grants for the purpose of upgrading teachers/learning facilitators competencies,
improving and expanding school facilities and providing instructional materials and equipment, which, in turn,
shall be reported to the appropriate district supervisors and division superintendents. However, under Section
6.2(11), Rule VI of the IRR, on the authority, accountability, and responsibility of school heads, district
supervisors were deleted as one of the administrative officers to whom such reporting is to be made. Petitioners
conclude that to the extent that the division superintendents are not mandated to report donations and grants to
district supervisors, the IRR is void.
On their plea for mandamus, petitioners pray that the Court compel the DepEd and the DBM to upgrade their
present salary grade. They claim that the position of an ESP is already classified as SG 21, which is higher by
two grades than that of district supervisors, SG 19. Considering their higher position in the departments
pecking order, vis--vis that of the ESPs, petitioners opine that to rectify the present grade-level distortion, their
salary grade should be upgraded to SG 24.22
For its part, the Office of the Solicitor General (OSG) avers that a perusal of Section 7(D) of R.A. No. 9155
shows that the district supervisor has limited responsibilities, and that the power to exercise administrative
supervision over the ESPs is not covered by any of those responsibilities. The Education Secretary is the
disciplining authority in the DepEd, with the regional directors acting as the disciplining authority in their
respective regions.
As to petitioners gripe that the IRR deleted district supervisors from among those school heads who should
report when "[a]ccepting donations, gifts, bequests, and grants for the purpose of upgrading teachers/learning
facilitators competencies, improving and expanding school facilities, and providing instructional materials and
equipment," the OSG avers that this reportorial function is "directory" and merely for "convenience."
Anent petitioners grievance on their alleged stagnant salary grade level, the OSG points out that the same is
"already provided for under FY 2003 GAA, [thus], petitioners complaint against the non-increase of their SG
level is already moot and academic." The OSG also emphasizes that the upgrading of the ESPs salary grade
over the petitioners is not violative of petitioners right to equal protection of the law, since "district supervisors
and ESPs are not similarly situated."
In reply, petitioners contend that the upgrading of the salary grade level of district supervisors to SG 21 is an
admission by the DepEd and by the DBM of the validity of their demand to increase their salary grade to a
respectable SG 24.
The petition is partially granted.
It must be stressed that the power of administrative officials to promulgate rules in the implementation of a
statute is necessarily limited to what is provided for in the legislative enactment. 23 The implementing rules and
regulations of a law cannot extend the law or expand its coverage, as the power to amend or repeal a statute is
vested in the legislature.24 It bears stressing, however, that administrative bodies are allowed under their power

of subordinate legislation to implement the broad policies laid down in a statute by "filling in" the details. All
that is required is that the regulation be germane to the objectives and purposes of the law; that the regulation
does not contradict but conforms with the standards prescribed by law. 25 Moreover, as a matter of policy, this
Court accords great respect to the decisions and/or actions of administrative authorities not only because of the
doctrine of separation of powers but also for their presumed knowledgeability and expertise in the enforcement
of laws and regulations entrusted to their jurisdiction.26 The rationale for this rule relates not only to the
emergence of the multifarious needs of a modern or modernizing society and the establishment of diverse
administrative agencies for addressing and satisfying those needs; it also relates to the accumulation of
experience and growth of specialized capabilities by the administrative agency charged with implementing a
particular statute.27
We have reviewed the IRR and find that Section 4.3 of Rule IV, and Sections 5.1 and 5.2 of Rule V are valid.
The provisions merely reiterate and implement the related provisions of R.A. No. 9155. Under the law, a
division superintendent has the authority and responsibility to hire, place, and evaluate all division supervisors
and district supervisors as well as all employees in the division, both teaching and non-teaching personnel,
including school heads.28 A school head is a person responsible for the administrative and instructional
supervision of the schools or cluster of schools.29 The division superintendent, on the other hand, supervises the
operation of all public and private elementary, secondary, and integrated schools and learning centers.30
Administrative supervision means "overseeing or the power or authority of an officer to see that their
subordinate officers perform their duties. If the latter fails or neglects to fulfill them, the former may take such
action or steps as prescribed by law to make them perform their duties."31
A plain reading of the law will show that the schools district supervisors have no administrative supervision
over the school heads; their responsibility is limited to those enumerated in Section 7(D) of R.A. No. 9155, to
wit:
(1) Providing professional and instructional advice and support to the school heads and
teachers/facilitators of schools and learning centers in the district or cluster thereof;
(2) Curricula supervision; and
(3) Performing such other functions as may be assigned by proper authorities.
As gleaned from the Senate deliberations on Senate Bill No. 2191, the district supervisors were divested of any
administrative supervision over elementary and public high schools. The Senate resolved to vest the same in the
division superintendents, and the Lower House concurred. Senator Rene Cayetano proposed that the traditional
function of the school supervisors of exercising administrative supervision over the elementary and public high
schools be maintained. However, Senator Tessie Aquino-Oreta, the Chairperson of the Senate Committee on
Education and the Sponsor of the Bill, objected to such proposal:
The President:
Why do we not say AND SHALL NOT BE INCLUDED?
Senator Cayetano:
Yes, better yet, Mr. President. I thank the Chair for that amendment.
The President:

All right. Can we approve that? The sponsor accepts the amendment, I assume.
Senator Aquino-Oreta:
Yes, Mr. President.
The President:
Is there any objection from the floor? (Silence) There being none, the amendment is approved.
Senator Cayetano:
Thank you, Mr. President.
In line 17, it ends with the conjunction "and." I would like to propose an amendment by inserting a new
paragraph (b). This is, of course, the duties and responsibilities of schools district supervisors. It is to
SUPERVISE SCHOOL PRINCIPALS IN THE DISTRICT, because right now, this is exactly their job.
Again, the reality is, there are efforts to minimize, if not remove, the principal function of school supervisors,
which is to supervise school principals in the district. I just want it to be there to ensure that their primary
functions remain as such.
Therefore, what appears as paragraph (b) in line 18 will now be subparagraph (c).
The President:
What does the sponsor say?
Senator Aquino-Oreta:
Mr. President, may I just explain. There are two school supervisors. One is for the academic function and the
other is for the administrative function. As such, if these two supervisors will dictate to the principals, then our
thrust in reducing the level of bureaucracy might not be met. Also, the thrust of this governance bill really is to
flesh out the importance of the school as the heart of education here. In that heart, we have the teacher, the
student, and the school head.
What we are trying to do here is to bring to the forefront the school itself. In fact, right now, there is a move in
the DECS to do away with the school supervisor in charge of administrative and leave that function to the
principal. If the principal, the school head will be dictated upon by these two school supervisors, we might not
be able to achieve what we want to do here putting to the forefront the school itself. Meaning, putting to the
forefront the school head, the teacher, and the student.
Senator Cayetano:
Mr. President, I would like to thank the sponsor for that enlightenment. That is precisely my point.
Not too long ago, I was a speaker before the school supervisors all over the land. One of the points that they
complained about was, in most cases, their job to supervise school principals is now being removed or have
been removed simply because and I may be inaccurate here the Japanese government I know it is a foreign
government that funded a study of the organizational setup of the DECS has recommended the abolition of
school supervisors.

This is the reason this representation would like to ensure that the traditional function of the school supervisors,
among which is to supervise school principals, remain as such. What is good for the Japanese education is not
necessarily good for the Philippines. This representation knows that this is precisely one of the complaints of
the school supervisors.
The lady sponsor admitted that, indeed, there is an effort to phase out the school supervisors. That is precisely
my point, Mr. President. I do not want the school supervisors to be phased out simply because a foreign
government which funded the study of our education has suggested it.
The President:
What does the sponsor say?
Senator Aquino-Oreta:
Mr. President, actually, it is not Japanese. It is an ADB proposal to the DECS. The DECS had a study made on
how to improve the management order of the DECS. That was one of the proposals. They gave three proposals.
One of them was to take out the school supervisors.
But precisely, Mr. President, we are not doing that, we are not taking them out. What we are saying is for the
school supervisor to focus on the curriculum because in the administration of the affairs of the school, we are
saying that the principal knows best how to administer or how to run the school better. And so, we are saying
here that school supervisors will be there contrary to the view of that ADB study. We will maintain them, but
the focus of the school supervisors will be on the curriculum of the schools.
Senator Cayetano:
Mr. President, again I thank the lady senator. But again let us look at who supervisors of schools are.
Supervisors of schools once upon a time were all school principals. They rose from the ranks, that is why they
are fully aware of the administrative as well as the instructional capability of the principals now who are under
them. To remove their right to supervise, now it is the ADB, I am correct, the lady senator is correct because
as I said I was not sure to remove this traditional function would really render the supervisors practically
without anything to do. That is why they are now being justified that henceforth there will be no principals that
will be promoted as school supervisors because when the school supervisors reach the age of retirement and
retire, no principals shall be promoted to that level. But these school supervisors now, Mr. President, were once
upon a time in their professional lives principals, and they know best how the schools should be run
administratively and instructionally. That is the reason for that, Mr. President.
The President:
What does the sponsor say?
Senator Cayetano:
So, may I ask the sponsor to accept this, Mr. President.
Senator Aquino-Oreta:
Mr. President, what was the amendment?
Senator Cayetano:

To insert a new paragraph, paragraph (b) in line 18, which states: SUPERVISE SCHOOL PRINCIPALS IN
THE DISTRICT.
The President:
May I suggest, THE SUPERVISION OF SCHOOL PRINCIPALS IN THE DISTRICT, because
Senator Cayetano:
Yes, Mr. President.
The President:
the antecedent for that is, "The schools district supervisor shall be responsible for."
Senator Cayetano:
That is right, Mr. President. Supervision, yes.
The President:
What does the sponsor say?
Senator Aquino-Oreta:
Mr. President, may I have one minute?
SUSPENSION OF SESSION
Senator Tatad:
Mr. President, I move that we suspend the session for one minute.
The President:
Is there any objection? (Silence) There being none, the session is suspended for one minute.
It was 5:33 p.m.
RESUMPTION OF SESSION
At 5:43 p.m., the session was resumed.
The President:
The session is resumed.
SUSPENSION OF CONSIDERATION OF S. NO. 2191
Senator Tatad:

Mr. President, we are still trying to find a way out of these conflicting points of view on the role of the
supervisor. To allow the parties to have a little more time to work on this, I move that we suspend consideration
of Senate Bill No. 2191. (Underscoring supplied)32
When the session resumed, Senator Cayetano no longer pursued his proposed amendment, and moved instead
that the same be amended to read "Curricula Supervision." The Senate approved the proposal of the Senator:
The President:
The session is resumed. Senator Cayetano is recognized.
CAYETANO AMENDMENT
Senator Cayetano:
Thank you, Mr. President.
With the permission of the lady senator, after consulting her and the Majority Leader, I would like to propose an
amendment by rewording the original amendment I was proposing last night. The reworded proposed
amendment would be like this: CURRICULA SUPERVISION.
The President:
That would be on what page?
Senator Cayetano:
That would be on page 10, line 17, as a new paragraph (b).
The President:
And how will it read?
Senator Cayetano:
CURRICULA SUPERVISION.
The President:
Just that?
Senator Cayetano:
Just that, Mr. President.
Senator Tatad:
Put a semicolon (;).
Senator Cayetano:

And because of that, line 18 which is paragraph (b), should now be paragraph (c).
The President:
What does the sponsor say?
Senator Aquino-Oreta:
The amendment is accepted, Mr. President. (Underscoring supplied)33
Thus, under R.A. No. 9155, administrative supervision over school heads is not one of those responsibilities
conferred on district supervisors.
It is a settled rule of statutory construction that the express mention of one person, thing, act, or consequence
excludes all others. This rule is expressed in the familiar maxim expressio unius est exclusio alterius. Where a
statute, by its terms, is expressly limited to certain matters, it may not, by interpretation or construction, be
extended to others. The rule proceeds from the premise that the legislature would not have made specified
enumerations in a statute had the intention been not to restrict its meaning and to confine its terms to those
expressly mentioned.34
It is not surprising that Senator Aquino-Oreta maintained her position that district supervisors should not have
administrative control or even supervision over ESPs and SSPs. As early as 1990, the DECS had adopted the
policy that, effective January 1, 1991, the positions of district supervisors and division supervisors would be
gradually phased out by not filling-up these positions as they become vacant.35 On September 17, 1991, then
DECS Secretary Isidro Cario issued DECS Order No. 110, Series of 1991, declaring that, to foster better
considerations and articulation of progress in the elementary level, all elementary school principals shall report
directly to the school division superintendents. In his Order dated June 22, 1994, then DECS Secretary Armand
V. Fabella declared that DECS Order No. 110 shall remain in effect, with the recommendation that, in order to
facilitate the phase-out of district supervisor positions, incumbent district supervisors were encouraged to
transfer to vacant division supervisor positions, provided they meet the qualification standards for such
positions.36 For his part, in his DECS Order No. 22, Series of 1996, DECS Secretary Ricardo T. Gloria restored
the district supervisor positions but only on a selective basis and subject to the following guidelines:
a) Schools superintendents, with the concurrence/approval of their regional directors, may have the
option to restore the position in selected districts after a careful evaluation of need. For this purpose, the
number of schools and their geographical location and distance for effective monitoring, the availability
of regular transportation, urban-rural setting, etc., should be considered in the decision.
b) The role of the district supervisor as an instructional leader and resource for teachers, rather than
merely as an administrative supervisor, should be emphasized in their functions and duties.
c) In the event of restoration and appointment of the position in a particular district, the school
superintendent shall ensure that the system of field supervision previous to the issuance of DECS Orders
No. 110, s. 1991 and No. 41, s. 1994 shall, likewise, be restored. Correspondingly, the designation of
coordinating principals in affected districts shall be withdrawn.
d) Should a division office opt not to restore some or all district supervisor positions, the funds for such
positions may be used to create new positions or upgrade existing positions, subject to the approval of
the Department of Budget and Management.
e) Considering that a number of vacated district supervisor positions in some divisions may have been
converted to other positions and/or otherwise phased out since 1991, appointments of district supervisors

shall be issued by regional directors only upon verification from the Department of Budget and
Management that the said position may be filled.
It is enjoined that regional directors and schools superintendents shall exert special effort to ensure that the
implementation of this Order shall be harmonious and conducive to field supervision. 37
Under DECS Order No. 36, Series of 1998 issued by DECS Secretary Erlinda C. Pefianco, the positions of
district supervisors were restored to their original status as a supervisory level in the DECS administrative
hierarchy subject to the following guidelines:
1.1 The positions of Education and District Supervisors are hereby restored to their original status as a
supervisory level in the DECS administrative hierarchy, subject to the following guidelines:
1.1.1 The functions of a district supervisor as an instructional leader and resource person for teachers
should be emphasized.
In the event of restoration and appointment of public schools district supervisor, the designation of the
coordinating principal shall be withdrawn.
Appointment of district supervisors shall be issued by regional directors only upon verification from the
Department of Budget and Management that the positions still exist since a number of vacated district
supervisor positions in some divisions may have been converted to other positions and/or otherwise phased out
since 1991.38
However, as already stated, the Senate resolved to maintain the positions of district supervisors but limited their
responsibilities only to those enumerated in Section 7(D) of R.A. No. 9155 to conform to the basic thrust and
objectives of the law. Far from strengthening the office of the district supervisors as a mid-head field office of
the DepEd, the law limited the authority and responsibility attached to such position.
While it is true that the district supervisor is given a support staff for program promotion, it cannot thereby be
implied that he/she likewise has administrative supervision over ESPs and SSPs. Such a construction has no
basis in law and in fact. Indeed, such a construction of the statute defeats the very purpose of the law.
It is a basic precept that the intent of the legislature is the controlling factor in the interpretation of the statute.
The particular words, clauses, and phrases should not be studied as detached and isolated expression, but the
whole and every part of the statute must be considered in fixing the meaning of any of its parts and in order to
produce a harmonious whole.39
Besides, Congress enumerated the duties and responsibilities of a district supervisor. Congress would not have
made specific enumerations in a statute if it had the intention not to restrict or limit its meaning and confine its
terms only to those expressly enumerated. Courts may not, in the guise of interpretation, enlarge the scope of a
statute and include situations not provided nor intended by Congress.40
The submission of the OSG, that the schools district supervisors have the administrative supervision over school
heads, is more in accord with the law, to wit:
Section 7 of RA 9155, on School District Level, pertinently provides that "a school district shall have a school
district supervisor and an office staff for program promotion," and that the schools district supervisor shall be
responsible for: (1) "(p)roviding professional and instructional advice and support to the school heads and
teachers/facilitators of schools and learning centers in the district [or] cluster thereof;" (2) "(c)urricula
supervision;" and, (3) "(p)erforming such other functions as may be assigned by the proper authorities."

A perusal of Section 7 shows that the District Supervisor has limited responsibilities, and that the power to
exercise administrative supervision over the ESPs is not covered by responsibility nos. 1 and 2. Neither is that
power covered by the directive that the District Supervisor shall have an office staff for program promotion.
The only logical conclusion, therefore, that can be derived from the aforesaid enumeration of responsibilities is
that the District Supervisor may only exercise administrative supervision over ESPs when such function is
assigned by proper authorities. And, since the DepEd Secretary specifically declared through the IRR of RA
9155, that the District Supervisor shall not exercise administrative supervision over the ESPs, unless otherwise
authorized, petitioners cannot complain against the said declaration. On this score, it is settled that the intent of
the statute is the law (Philippine National Bank v. Office of the President, 252 SCRA 5 [1996]). In the absence
of legislative intent to the contrary, words and phrases used in a statute should be given their plain, ordinary and
common usage meaning (Mustang Lumber, Inc. v. Court of Appeals, 257 SCRA 430 [1996]).
Needless to say, Section 7, on Division Level, further provides that the School Division Superintendent shall
have authority, accountability and responsibility for, among others, "(s)upervising the operation of all public
and private elementary, secondary and integrated schools, and learning centers." To claim, therefore, that the
District Supervisor has administrative supervision over the ESPs would also violate the above-quoted
provision.41
The Court likewise declares that the last paragraph of Section 4.3 of the IRR, stating that the regional director
shall continue exercising disciplinary authority over the teaching personnel insofar as the latter are covered by
specific and exclusive disciplinary provisions under R.A. No. 4670 ("Magna Carta for Public School Teachers")
does not contravene R.A. No. 9155. Indeed, the IRR merely reiterates the DECS Rules of Procedure, DECS
Order No. 33, issued on March 30, 1999 by the DepEd Secretary, and R.A. No. 4670 which was approved on
June 18, 1966, and pursuant to Section 7, Chapter II, Book IV of the 1987 Administrative Code, which provides
that the DepEd Secretary is empowered to
a. Promulgate rules and regulations necessary to carry out department objectives, policies, functions,
plans, programs, and projects; and
b. Promulgate administrative issuances necessary for the efficient administration of the offices under the
Secretary and for execution of the laws relative thereto.
Additionally, the IRR was issued by the DepEd Secretary pursuant to Section 7(A)(1) of R.A. No. 9155, which
mandates that the Secretary formulate national educational policies and enhance the employment status,
professional competence, welfare, and working conditions of all the DepEd personnel.42
We agree that R.A. No. 9155 does not provide who has disciplinary authority over the teaching personnel of the
DepEd. However, under Section 3, Chapter III of DECS Order No. 33, Series of 1999, otherwise known as the
1999 DECS Rules of Procedure, the disciplining authority in the DECS is the DepEd Secretary, with the
regional directors acting as such in their respective regions except those appointed by the President.43
The officers and employees referred to in the Rules of Procedure include teachers who, under R.A. No. 4670,
shall mean:
x x x all persons engaged in classroom teaching, in any level of instruction, on full-time basis, including
guidance counselors, school librarians, industrial arts, or vocational instructors, and all other persons
performing supervisory and/or administrative functions in all schools, colleges and universities operated by the
Government or its political subdivisions; but shall not include school nurses, school physicians, school dentists,
and other school employees.
A division superintendent of schools is not a disciplining authority over teachers, whether under R.A. No. 4670
or under the DECS Rules of Procedure. In fact, under Section 2, Chapter VII of such Rules of Procedure, a

division superintendent is a chairperson of the investigating committee over formal complaints filed against
such teachers:
a) When the respondent is an elementary or secondary school teacher, head teacher, principal, district
supervisor/chair/coordinator or Education Supervisor I
(1) The schools division superintendent or his or her duly authorized representative, as chairperson;
(2) The duly authorized representative of the school, district, or division teachers organization, as
member; and
(3) The division supervisor for elementary or secondary education where the respondent belongs, as
member.
The foregoing rule is based on Section 9 of R.A. No. 4670 which reads:
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
should, 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 teachers 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.
Anent the issue on reporting of acceptance of donations, Section 7(E)(11) of R.A. No. 9155 provides:
(11) Accepting donations, gifts, bequests, and grants for the purpose of upgrading teachers/learning facilitators
competencies, improving and expanding school facilities, and providing instructional materials and equipment.
Such donations or grants must be reported to the appropriate district supervisors and division superintendents.
(emphasis supplied)
However, Section 6.2(11), Rule VI of the IRR provides that:
(11) Accepting donations, gifts, bequests, and grants in accordance with existing laws and policy of the
Department for the purpose of upgrading teachers/learning facilitators competencies, improving and
expanding school facilities, and providing instructional materials and equipment. Such donations or grants must
be reported to the division superintendents. (emphasis supplied)
We agree with petitioners contention that, under the law, donations and grants must be reported to the
appropriate district supervisors and not only to the division superintendents. The use in the law of the word
"must" is an expression of the mandatory nature of the reporting of donations and grants to district supervisors.
The reason for the provision is that such grants and donations which are intended to upgrade teachings/learning
facilitators competencies, improve and expand school facilities, and provide instructional materials and
equipment will assist the school district supervisors in the performance of their duties and responsibilities under
Section 7(D) of R.A. No. 9155, and submit appropriate recommendations to the proper administrative officers.
On petitioners plaint of the failure of respondents to upgrade their salary grade level to at most SG 21, and for
the issuance of the writ of mandamus mandating respondents to increase their salary grade from SG 19 to 24,
the same is premature.

There is no showing in the petition that, before filing their petition, petitioners sought an adjustment of level of
their salary grade from SG 19 to SG 21 before respondents or the Civil Service Commission. Section 17 of
Presidential Decree No. 985, as amended by Section 14 of R.A. No. 6758, otherwise known as the Salary
Standardization Law, provides:
Sec. 17. Powers and Functions. The Budget Commission (now Department of Budget and Management),
principally through the OCPC (now CPCB, Compensation and Position Classification Board) shall, in addition
to those provided under other Sections of this Decree, have the following powers and functions:
a. Administer the compensation and position classification system established herein and revise it as necessary;
xxxx
f. Certify classification actions and changes in class or grade of positions whenever the facts warrant, such
certification to be binding on administrative, certifying, payroll, disbursing, accounting and auditing officers of
the national government and government-owned or controlled corporations and financial institutions.
Sections 10 and 11 of R.A. No. 9155 provide:
SEC. 10. The Secretary of Education and the Secretary of Budget and Management shall, within ninety (90)
days from the approval of this Act, jointly promulgate the guidelines on the allocation, distribution, and
utilization of resources provided by the national government for the field offices, taking into consideration the
uniqueness of the working conditions of the teaching service.
The Secretary of the Department of Education shall ensure that resources appropriated for the field offices are
adequate and that resources for school personnel, school desks, and textbooks and other instructional materials
intended are allocated directly and released immediately by the Department of Budget and Management to said
offices.
SEC. 11. The Secretary of the Department of Education, subject to civil service laws and regulations, shall issue
appropriate personnel policy rules and regulations that will best meet the requirements of the teaching
profession taking into consideration the uniqueness of the working conditions of the teaching service.
And insofar as the salary system for teaching positions is concerned, Section 14 provides:
SEC. 14. The Salary System for Teaching Position. The salary grade of a teacher shall be determined in
accordance with the following:
a. The Teachers Preparation Pay Schedule shall be prepared by the Commission in consultation with the
Department of Education and Culture. Under this system, the teacher's academic or educational
preparation, teaching experience in both private and public schools, and extra-curricular activities for
professional growth, shall be considered in pursuance of the principle of 'equal pay for equal training
and experience.'
xxxx
d. The Budget Commission, in coordination and consultation with the Department of Education and
Culture and the Civil Service Commission may, when future needs require, modify, change or otherwise
improve on the salary system herein established for the teaching and closely related occupations, any
change that may be made as provided herein shall become part of the implementing rules of this Decree
to be issued by the Budget Commission upon prior approval by the President.

Moreover, the issue of whether or not respondents should be compelled to adjust upwards the salary grade of
petitioners to SG 21 has become moot and academic, because, on November 3, 2003, the DepEd and the DBM
issued Joint Circular No. 1, Series of 2003 containing the guidelines in the implementation of the Salary
Upgrading for District and Education Supervisors, to wit:
4.0 GUIDELINES
4.1 To maintain the previous salary grade relationships under RA No. 6758 among the PSDS and ES I,
on the one hand, and Elementary School Principal (ESP) IV and Secondary School Principal (SSP) II,
on the other hand, and to preserve the consistency in the salary grade relationships of said positions, the
following are hereby authorized:
4.1.1 Upgrading of the PSDS and ES I positions from SG-19 to SG-20 in July 2003 and to SG-21
in July 2004;
4.1.2 Upgrading of the ES II positions by two (2) salary grades from SG-20 to SG-21 in July
2003 and to SG-22 in July 2004;
4.1.3 A one-step salary adjustment to incumbents of ES III positions starting July 2003 and
another one-step salary adjustment starting July 2004;
4.1.4 A one-step salary adjustment to incumbents of CES positions starting July 2003 and
another one-step salary adjustment starting July 2004.
4.2 Attached herewith is Annex A containing the summary of the guidelines for the salary upgrading of
positions authorized herein.
5.0 SALARY RULES
5.1 For purposes of the salary upgrading herein authorized, the basic salary of the employee concerned
shall be adjusted as follows:
5.1.1 Effective July 1, 2003 at the same salary step of his assigned salary grade as of June 30,
2003 (Illustrative Example A) adopting the Salary Schedule prescribed under National Budget
Circular (NBC) No. 474 (Annex B);
5.1.2 Effective July 1, 2004 at the same salary step of his assigned salary grade as of June 30,
2004 (Illustrative Example A) adopting the Salary Schedule prescribed under National Budget
Circular (NBC) No. 474 (Annex B).
5.2 The transition allowance as defined in 3.2 being received by the PSDS and ES, if any, shall be
considered as advance entitlement of the salary increase herein authorized. (Illustrative Examples B and
C)
5.3 No step adjustment shall be granted to incumbents of positions whose salary already falls at or
exceeds the maximum step (eighth step) of the salary grade allocation of their positions. (Illustrative
Example D)
5.4 The herein salary increases shall be effected through the issuance of a Notice of Salary Adjustment
(NOSA) by the duly authorized official. (Annex C)

6.0 FUNDING SOURCE

The amounts necessary to implement the salary adjustments authorized herein shall be charged against the
Nationwide lump sum appropriation for the purpose amounting to fifty million pesos (P50,000,000) in the
DepEds budget in RA 9206, the CY 2003 General Appropriations Act. For CY 2004, the same shall be charged
against the lump sum appropriation for the purpose that may be included in the 2004 budget.
7.0 POST-AUDIT
Any salary adjustment paid under this Circular shall be subject to post-audit by the DBM ROs concerned.
Any payments thereof which are not in accordance herewith shall be adjusted accordingly.
8.0 CONTRIBUTIONS
The salary adjustments authorized herein are subject to the mandatory requirements for life and retirement
premiums, and health insurance premiums.
9.0 SAVING CLAUSE
Conflicts arising from the implementation of the provisions of this Circular shall be resolved by the Department
of Education, upon prior consultation with the Department of Budget and Management.
10.0 EFFECTIVITY
This Circular Letter shall take effect on July 1, 2003.
IN VIEW OF ALL THE FOREGOING, the petition for prohibition is PARTIALLY GRANTED. Joint Circular
No. 1, Series of 2003 is declared valid, except Section 6.2(11), Rule VI thereof which provides that "donations
or grants shall be reported only to the division superintendents." Such donations or grants must also be reported
to the appropriate school district supervisors, as mandated by Republic Act No. 9155. Petitioners prayer for the
issuance of a writ of mandamus is DENIED for lack of merit. No costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 82849 August 2, 1989
CEBU OXYGEN & ACETYLENE CO., INC. (COACO) petitioner,
vs.
SECRETARY FRANKLIN M. DRILON OF THE DEPARTMENT OF LABOR AND EMPLOYMENT,
ASSISTANT REGIONAL DIRECTOR CANDIDO CUMBA OF THE DEPARTMENT OF LABOR
AND EMPLOYMENT, REGIONAL OFFICE NO. 7 AND CEBU OXYGEN-ACETYLENE &
CENTRAL VISAYAS EMPLOYEES ASSOCIATION (COACVEA) respondents.
Michael L. Rama for petitioner.
Armando M. Alforque for private respondent.

GANCAYCO, J.;
The principal issue raised in this petition is whether or not an Implementing Order of the Secretary of Labor and
Employment (DOLE) can provide for a prohibition not contemplated by the law it seeks to implement.
The undisputed facts are as follows:
Petitioner and the union of its rank and file employees, Cebu Oxygen, Acetylene and Central Visayas
Employees Association (COAVEA) entered into a collective bargaining agreement (CBA) covering the years
1986 to 1988. Pursuant thereto, the management gave salary increases as follows:
ARTICLE IV SALARIES/RICE RATION
Section 1. The COMPANY agrees that for and during the three (3) year effectivity of this
AGREEMENT, it will grant to all regular covered employees the following salary increases:
Salaries:
1) For the first year which will be paid on January 14, 1986 P200 to each covered employee.
IT IS HEREBY EXPRESSLY AGREED AND UNDERSTOOD THAT THIS PAY INCREASE
SHALL BE CREDITED AS PAYMENT TO ANY MANDATED GOVERNMENT WAGE
ADJUSTMENT OR ALLOWANCE INCREASES WHICH MAY BE ISSUED BY WAY OF
LEGISLATION, DECREE OR PRESIDENT
2) For the second year which will be paid on January 16, 1987-P 200 to each covered employee.
IT IS HEREBY EXPRESSLY AGREED AND UNDERSTOOD THAT THIS PAY INCREASE
SHALL BE CREDITED AS PAYMENT TO ANY DATED GOVERNMENT WAGE
ADJUSTMENT OR ALLOWANCE INCREASES WHICH MAY BE ISSUED BY WAY OF

LEGISLATION, DECREE OR PRESIDENTIAL EDICT COUNTED FROM THE ABOVE

DATE TO THE NEXT INCREASE.
3) For the third year which will be paid on January 16, 1988 P300 to each covered employee.
IT IS HEREBY EXPRESSLY AGREED AND UNDERSTOOD THAT THIS PAY INCREASE
SHALL BE CREDITED AS PAYMENT TO ANY MANDATED GOVERNMENT WAGE
ADJUSTMENT OR ALLOWANCE INCREASES WHICH MAY BE ISSUED BY WAY OF
LEGISLATION, DECREE OR PRESIDENTIAL EDICT COUNTED FROM THE ABOVE
DATE TO THE NEXT INCREASE.
IF THE WAGE ADJUSTMENT OF ALLOWANCE INCREASES DECREED BY LAW,
LEGISLATION OR PRESIDENTIAL qqqEDICT IN ANY PARTICULAR YEAR SHALL BE
HIGHER THAN THE FOREGOING INCREASES IN THAT PARTICULAR YEAR, THEN
THE COMPANY SHALL PAY THE DIFFERENCE.
On December 14, 1987, Republic Act No. 6640 was passed increasing the minimum wage, as follows:
Sec. 2. The statutory minimum wage rates of workers and employees in the private sector,
whether agricultural or non-agricultural, shall be increased by ten pesos (P10.00) per day, except
non-agricultural workers and employees outside Metro Manila who shall receive an increase of
eleven pesos (P11.00) per day: Provided, that those already receiving above the minimum wage
up to one hundred pesos (Pl 00.00 shall receive an increase of ten pesos (Pl 0.00) per day.
Excepted from the provisions of this Act are domestic helpers and persons employed in the
personal service of another.
The Secretary of Labor issued the pertinent rules implementing the provisions of Republic Act No. 6640.
Section 8 thereof provides:
Section 8. Wage Increase Under Individual/Collective Agreements. No wage increase shall be
credited as compliance with the increase prescribed herein unless expressly provided under valid
individual written/collective agreements; and, provided further, that such wage increase was
granted in anticipation of the legislated wage increase under the act. Such increases shall not
include anniversary wage increases provided on collective agreements.
In sum, Section 8 of the implementing rules prohibits the employer from crediting anniversary wage increases
negotiated under a collective bargaining agreement against such wage increases mandated by Republic Act No.
6640.
Accordingly, petitioner credited the first year increase of P200.00 under the CBA and added the difference of
P61.66 (rounded to P62.00) and P31.00 to the monthly salary and the 13th month pay, respectively, of its
employees from the effectivity of Republic Act No. 6640 on December 14,1987 to February 15, 1988.
On February 22, 1988, a Labor and Employment Development Officer, pursuant to Inspection Authority No.
058-88, commenced a routine inspection of petitioner's establishment. Upon completion of the inspection on
March 10, 1988, and based on payrolls and other records, he found that petitioner committed violations of the
law as follows:
1. Under payment of Basic Wage per R.A. No. 6640 covering the period of two (2) months
representing 208 employees who are not receiving wages above P100/day prior to the effectivity
of R.A. No. 6640 in the aggregate amount of EIGHTY THREE THOUSAND AND TWO
HUNDRED PESOS (P83,200.00); and

2. Under payment of 13th month pay for the year 1987, representing 208 employees who are not
receiving wages above P 100/day prior to the effectivity of R.A. No. 6640 in the aggregate
amount of FORTY EIGHT THOUSAND AND FORTY EIGHT PESOS (P48,048.00).
On April 7, 1988, respondent Assistant Regional Director, issued an Order instructing petitioner to pay its 208
employees the aggregate amount of P 131,248.00, computed as follows:
Computation sheet of differentials due to COACO-Cebu Workers.
Salary Differentials:
a) From December 14/87 to February 15/88
= P200.00/mo x 2 months
= P400.00
= P400 x 208 employees (who are not receiving above P100/day as wages before the effectivity
of R.A. No. 6640)
=P 83,200.00
b) 13th month pay differentials of the year 1987:
= P231.00 x 208 employees (who are not receiving above P100/day as wages before the
effectivity of RA. No. 6640)
=P48,048.00
Total = P131,248.00
In sum, the Assistant Regional Director ordered petitioner to pay the deficiency of P200.00 in the monthly
salary and P 231.00 in the 13th month pay of its employees for the period stated. Petitioner protested the Order
of the Regional Director on the ground that the anniversary wage increases under the CBA can be credited
against the wage increase mandated by Republic Act No. 6640. Hence, petitioner contended that inasmuch as it
had credited the first year increase negotiated under the CBA, it was liable only for a salary differential of P
62.00 and a 13th month pay differential of P31.00. Petitioner argued that the payment of the differentials
constitutes full compliance with Republic Act No. 6640. Apparently, the protest was not entertained. Petitioner
brought the case immediately to this Court without appealing the matter to the Secretary of Labor and
Employment. On May 9,1988, this Court issued a temporary restraining order enjoining the Assistant Regional
Director from enforcing his Order dated April 7, 1988. 1 The thrust of the argument of petitioner is that Section
8 of the rules implementing the provisions of Republic Act No. 6640 particularly the provision excluding
anniversary wage increases from being credited to the wage increase provided by said law is null and void on
the ground that the same unduly expands the provisions of the said law.
This petition is impressed with merit.
Public respondents aver that petitioner should have first appealed to the Secretary of Labor before going to
court. It is fundamental that in a case where only pure questions of law are raised, the doctrine of exhaustion of
administrative remedies cannot apply because issues of law cannot be resolved with finality by the
administrative officer. Appeal to the administrative officer of orders involving questions of law would be an

exercise in futility since administrative officers cannot decide such issues with finality. 2 The questions raised in
this petition are questions of law. Hence, the failure to exhaust administrative remedies cannot be considered
fatal to this petition.
As to the issue of the validity of Section 8 of the rules implementing Republic Act No. 6640, which prohibits
the employer from crediting the anniversary wage increases provided in collective bargaining agreements, it is a
fundamental rule that implementing rules cannot add or detract from the provisions of law it is designed to
implement. The provisions of Republic Act No. 6640, do not prohibit the crediting of CBA anniversary wage
increases for purposes of compliance with Republic Act No. 6640. The implementing rules cannot provide for
such a prohibition not contemplated by the law. Administrative regulations adopted under legislative authority
by a particular department must be in harmony with the provisions of the law, and should be for the sole
purpose of carrying into effect its general provisions. The law itself cannot be expanded by such regulations. An
administrative agency cannot amend an act of Congress. 3 Thus petitioner's contention that the salary increases
granted by it pursuant to the existing CBA including anniversary wage increases should be considered in
determining compliance with the wage increase mandated by Republic Act No. 6640, is correct. However, the
amount that should only be credited to petitioner is the wage increase for 1987 under the CBA when the law
took effect. The wage increase for 1986 had already accrued in favor of the employees even before the said law
was enacted.
Petitioner therefor correctly credited its employees P62.00 for the differential of two (2) months increase and
P31.00 each for the differential in 13th month pay, after deducting the P200.00 anniversary wage increase for
1987 under the CBA. Indeed, it is stipulated in the CBA that in case any wage adjustment or allowance increase
decreed by law, legislation or presidential edict in any particular year shall be higher than the foregoing increase
in that particular year, then the company (petitioner) shall pay the difference.
WHEREFORE, the petition is hereby GRANTED. The Order of the respondent Assistant Regional Director
dated April 7, 1988 is modified in that petitioner is directed to pay its 208 employees so entitled the amount of
P62.00 each as salary differential for two (2) months and P31.00 as 13th month pay differential in full
compliance with the provisions of Republic Act No. 6640. Section 8 of the rules implementing Republic 6640,
is hereby declared null and void in so far as it excludes the anniversary wage increases negotiated under
collective bargaining agreements from being credited to the wage increase provided for under Republic Act No.
6440. This decision is immediately executory.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 131082

June 19, 2000

ROMULO, MABANTA, BUENAVENTURA, SAYOC & DE LOS ANGELES, petitioner,

vs.
HOME DEVELOPMENT MUTUAL FUND, respondent.
DAVIDE, JR., C.J.:
Once again, this Court is confronted with the issue of the validity of the Amendments to the Rules and
Regulations Implementing Republic Act No. 7742, which require the existence of a plan providing for both
provident/retirement and housing benefits for exemption from the Pag-IBIG Fund coverage under Presidential
Decree No. 1752, as amended.
Pursuant to Section 19 1 of P.D. No. 1752, as amended by R.A. No. 7742, petitioner Romulo, Mabanta,
Buenaventura, Sayoc and De Los Angeles (hereafter PETITIONER), a law firm, was exempted for the period 1
January to 31 December 1995 from the Pag-IBIG Fund coverage by respondent Home Development Mutual
Fund (hereafter HDMF) because of a superior retirement plan. 2
On 1 September 1995, the HDMF Board of Trustees, pursuant to Section 5 of Republic Act No. 7742, issued
Board Resolution No. 1011, Series of 1995, amending and modifying the Rules and Regulations Implementing
R.A. No. 7742. As amended, Section 1 of Rule VII provides that for a company to be entitled to a waiver or
suspension of Fund coverage, 3 it must have a plan providing for both provident/retirement and housing benefits
superior to those provided under the Pag-IBIG Fund.
On 16 November 1995, PETITIONER filed with the respondent an application for Waiver or Suspension of
Fund Coverage because of its superior retirement plan. 4 In support of said application, PETITIONER submitted
to the HDMF a letter explaining that the 1995 Amendments to the Rules are invalid. 5
In a letter dated 18 March 1996, the President and Chief Executive Officer of HDMF disapproved
PETITIONER's application on the ground that the requirement that there should be both a provident retirement
fund and a housing plan is clear in the use of the phrase "and/or," and that the Rules Implementing R.A. No.
7742 did not amend nor repeal Section 19 of P.D. No. 1752 but merely implement the law. 6
PETITIONER's appeal 7 with the HDMF Board of Trustees was denied for having been rendered moot and
academic by Board Resolution No. 1208, Series of 1996, removing the availment of waiver of the mandatory
coverage of the Pag-IBIG Fund, except for distressed employers. 8
On 31 March 1997, PETITIONER filed a petition for review 9 before the Court of Appeals. On motion by
HDMF, the Court of Appeals dismissed 10 the petition on the ground that the coverage of employers and
employees under the Home Development Mutual Fund is mandatory in character as clearly worded in Section 4
of P.D. No. 1752, as amended by R.A. No. 7742. There is no allegation that petitioner is a distressed employer
to warrant its exemption from the Fund coverage. As to the amendments to the Rules and Regulations
Implementing R.A. No. 7742, the same are valid. Under P.D. No. 1752 and R.A. No. 7742 the Board of
Trustees of the HDMF is authorized to promulgate rules and regulations, as well as amendments thereto,
concerning the extension, waiver or suspension of coverage under the Pag-IBIG Fund. And the publication

requirement was amply met, since the questioned amendments were published in the 21 October 1995 issue of
the Philippine Star, which is a newspaper of general circulation.
PETITIONER's motion for reconsideration 11 was denied. 12 Hence, on 6 November 1997, PETITIONER filed a
petition before this Court assailing the 1995 and the 1996 Amendments to the Rules and Regulations
Implementing Republic Act No. 7742 for being contrary to law. In support thereof, PETITIONER contends that
the subject 1995 Amendments issued by HDMF are inconsistent with the enabling law, P.D. No. 1752, as
amended by R.A. No. 7742, which merely requires as a pre-condition for exemption from coverage the
existence of either a superior provident/retirement plan or a superior housing plan, and not the concurrence of
both plans. Hence, considering that PETITIONER has a provident plan superior to that offered by the HDMF, it
is entitled to exemption from the coverage in accordance with Section 19 of P.D. No. 1752. The 1996
Amendment are also void insofar as they abolished the exemption granted by Section 19 of P.D. 1752, as
amended. The repeal of such exemption involves the exercise of legislative power, which cannot be delegated to
HMDF.
PETITIONER also cites Section 9 (1), Chapter 2, Book VII of the Administrative Code of 1987, which
provides:
Sec. 9. Public Participation (1) If not otherwise required by law, an agency shall, as far as
practicable, publish or circulate notices of proposed rules and afford interested parties the opportunity to
submit their views prior to the adoption of any rule.
Since the Amendments to the Rules and Regulations Implementing Republic Act No. 7742 involve an
imposition of an additional burden, a public hearing should have first been conducted to give chance to the
employers, like PETITIONER, to be heard before the HDMF adopted the said Amendments. Absent such
public hearing, the amendments should be voided.
Finally, PETITIONER contends that HDMF did not comply with Section 3, Chapter 2, Book VII of the
Administrative Code of 1987, which provides that "[e]very agency shall file with the University of the
Philippines Law Center three (3) certified copies of every rule adopted by it."
On the other hand, the HDMF contends that in promulgating the amendments to the rules and regulations which
require the existence of a plan providing for both provident and housing benefits for exemption from the Fund
Coverage, the respondent Board was merely exercising its rule-making power under Section 13 of P.D. No.
1752. It had the option to use "and" only instead of "or" in the rules on waiver in order to effectively implement
the Pag-IBIG Fund Law. By choosing "and," the Board has clarified the confusion brought about by the use of
"and/or" in Section 19 of P.D. No. 1752, as amended.
As to the public hearing, HDMF maintains that as can be clearly deduced from Section 9(1), Chapter 2, Book
VII of the Revised Administrative Code of 1987, public hearing is required only when the law so provides, and
if not, only if the same is practicable. It follows that public hearing is only optional or discretionary on the part
of the agency concerned, except when the same is required by law. P.D. No. 1752 does not require that pubic
hearing be first conducted before the rules and regulations implementing it would become valid and effective.
What it requires is the publication of said rules and regulations at least once in a newspaper of general
circulation. Having published said 1995 and 1996 Amendments through the Philippine Star on 21 October
1995 1 and 15 November 1996, 14respectively, HDMF has complied with the publication requirement.
Finally, HDMF claims that as early as 18 October 1996, it had already filed certified true copies of the
Amendments to the Rules and Regulations with the University of the Philippines Law Center. This fact is
evidenced by certified true copies of the Certification from the Office of the National Administrative Register of
the U.P. Law Center. 15

We find for the PETITIONER.

The issue of the validity of the 1995 Amendments to the Rules and Regulations Implementing R.A. No. 7742,
specifically Section I, Rule VII on Waiver and Suspension, has been squarely resolved in the relatively recent
case of China Banking Corp. v. The Members of the Board of Trustees of the HDMF. 16 We held in that case
that Section 1 of Rule VII of the Amendments to the Rules and Regulations Implementing R.A. No. 7742, and
HDMF Circular No. 124-B prescribing the Revised Guidelines and Procedure for Filing Application for Waiver
or Suspension of Fund Coverage under P.D. No. 1752, as amended by R.A. No. 7742, are null and void insofar
as they require that an employer should have both a provident/retirement plan and a housing plan superior to the
benefits offered by the Fund in order to qualify for waiver or suspension of the Fund coverage. In arriving at
said conclusion, we ruled:
The controversy lies in the legal signification of the words "and/or."
In the instant case, the legal meaning of the words "and/or" should be taken in its ordinary
signification, i.e., "either and or; e.g. butter and/or eggs means butter and eggs or butter or eggs.
The term "and/or" means that the effect shall be given to both the conjunctive "and" and the
disjunctive "or"; or that one word or the other may be taken accordingly as one or the other will
best effectuate the purpose intended by the legislature as gathered from the whole statute. The
term is used to avoid a construction which by the use of the disjunctive "or" alone will exclude
the combination of several of the alternatives or by the use of the conjunctive "and" will exclude
the efficacy of any one of the alternatives standing alone.1avvphi1
It is accordingly ordinarily held that the intention of the legislature in using the term "and/or" is that the
word "and" and the word "or" are to be used interchangeably.
It . . . seems to us clear from the language of the enabling law that Section 19 of P.D. No. 1752 intended
that an employer with a provident plan or an employee housing plan superior to that of the fund may
obtain exemption from coverage. If the law had intended that the employee [sic] should have both a
superior provident plan and a housing plan in order to qualify for exemption, it would have used the
words "and" instead of "and/or." Notably, paragraph (a) of Section 19 requires for annual certification of
waiver or suspension, that the features of the plan or plans are superior to the fund or continue to be so.
The law obviously contemplates that the existence of either plan is considered as sufficient basis for the
grant of an exemption; needless to state, the concurrence of both plans is more than sufficient. To
require the existence of both plans would radically impose a more stringent condition for waiver which
was not clearly envisioned by the basic law. By removing the disjunctive word "or" in the implementing
rules the respondent Board has exceeded its authority.
It is without doubt that the HDMF Board has rule-making power as provided in Section 51 17 of R.A. No. 7742
and Section 13 18 of P.D. No. 1752. However, it is well-settled that rules and regulations, which are the product
of a delegated power to create new and additional legal provisions that have the effect of law, should be within
the scope of the statutory authority granted by the legislature to the administrative agency. 19 It is required that
the regulation be germane to the objects and purposes of the law, and be not in contradiction to, but in
conformity with, the standards prescribed by law. 20
In the present case, when the Board of Trustees of the HDMF required in Section 1, Rule VII of the 1995
Amendments to the Rules and Regulations Implementing R.A. No. 7742 that employers should have both
provident/retirement and housing benefits for all its employees in order to qualify for exemption from the Fund,
it effectively amended Section 19 of P.D. No. 1752. And when the Board subsequently abolished that
exemption through the 1996 Amendments, it repealed Section 19 of P.D. No. 1752. Such amendment and
subsequent repeal of Section 19 are both invalid, as they are not within the delegated power of the Board. The

HDMF cannot, in the exercise of its rule-making power, issue a regulation not consistent with the law it seeks to
apply. Indeed, administrative issuances must not override, supplant or modify the law, but must remain
consistent with the law they intend to carry out. 21 Only Congress can repeal or amend the law.
While it may be conceded that the requirement of having both plans to qualify for an exemption, as well as the
abolition of the exemption, would enhance the interest of the working group and further strengthen the Home
Development Mutual Fund in its pursuit of promoting public welfare through ample social services as mandated
by the Constitution, we are of the opinion that the basic law should prevail. A department zeal may not be
permitted to outrun the authority conferred by the statute. 22
Considering the foregoing conclusions, it is unnecessary to dwell on the other issues raised.
WHEREFORE, the petition is GRANTED. The assailed decision of 31 July 1997 of the Court of Appeals in
CA-G.R. No. SP-43668 and its Resolution of 15 October 1997 are hereby REVERSED and SET ASIDE. The
disapproval by the Home Development Mutual Fund of the application of the petitioner for waiver or
suspension of Fund coverage is SET ASIDE, and the Home Development Mutual Fund is hereby directed to
refund to petitioner all sums of money it collected from the latter.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 110526 February 10, 1998

ASSOCIATION OF PHILIPPINE COCONUT DESICCATORS, petitioner,
vs.
PHILIPPINE COCONUT AUTHORITY, respondent.

MENDOZA, J.:
At issue in this case is the validity of a resolution, dated March 24, 1993, of the Philippine Coconut Authority in
which it declares that it will no longer require those wishing to engage in coconut processing to apply to it for a
license or permit as a condition for engaging in such business.
Petitioner Association of Philippine Coconut Desiccators (hereafter referred to as APCD) brought this suit
forcertiorari and mandamus against respondent Philippine Coconut Authority (PCA) to invalidate the latter's
Board Resolution No. 018-93 and the certificates of registration issued under it on the ground that the resolution
in question is beyond the power of the PCA to adopt, and to compel said administrative agency to comply
instead with the mandatory provisions of statutes regulating the desiccated coconut industry, in particular, and
the coconut industry, in general.
As disclosed by the parties' pleadings, the facts are as follows:
On November 5, 1992, seven desiccated coconut processing companies belonging to the APCD brought suit in
the Regional Trial Court, National Capital Judicial Region in Makati, Metro Manila, to enjoin the PCA from
issuing permits to certain applicants for the establishment of new desiccated coconut processing plants.
Petitioner alleged that the issuance of licenses to the applicants would violate PCA's Administrative Order No.
02, series of 1991, as the applicants were seeking permits to operate in areas considered "congested" under the
administrative order. 1
On November 6, 1992, the trial court issued a temporary restraining order and, on November 25, 1992, a writ of
preliminary injunction, enjoining the PCA from processing and issuing licenses to Primex Products, Inc., Coco
Manila, Superstar (Candelaria) and Superstar (Davao) upon the posting of a bond in the amount of
P100,000.00.2
Subsequently and while the case was pending in the Regional Trial Court, the Governing Board of the PCA
issued on March 24, 1993 Resolution No. 018-93, providing for the withdrawal of the Philippine Coconut
Authority from all regulation of the coconut product processing industry. While it continues the registration of
coconut product processors, the registration would be limited to the "monitoring" of their volumes of production
and administration of quality standards. The full text of the resolution reads:
RESOLUTION NO. 018-93
POLICY DECLARATION DEREGULATING

THE ESTABLISHMENT OF NEW COCONUT

PROCESSING PLANTS
WHEREAS, it is the policy of the State to promote free enterprise unhampered by protective regulations
and unnecessary bureaucratic red tapes;
WHEREAS, the deregulation of certain sectors of the coconut industry, such as marketing of coconut
oils pursuant to Presidential Decree No. 1960, the lifting of export and commodity clearances under
Executive Order No. 1016, and relaxation of regulated capacity for the desiccated coconut sector
pursuant to Presidential Memorandum of February 11, 1988, has become a centerpiece of the present
dispensation;
WHEREAS, the issuance of permits or licenses prior to business operation is a form of regulation which
is not provided in the charter of nor included among the powers of the PCA;
WHEREAS, the Governing Board of PCA has determined to follow and further support the deregulation
policy and effort of the government to promote free enterprise;
NOW THEREFORE, BE IT RESOLVED AS IT IS HEREBY RESOLVED, that, henceforth, PCA shall
no longer require any coconut oil mill, coconut oil refinery, coconut desiccator, coconut product
processor/factory, coconut fiber plant or any similar coconut processing plant to apply with PCA and the
latter shall no longer issue any form of license or permit as condition prior to establishment or operation
of such mills or plants;
RESOLVED, FURTHER, that the PCA shall limit itself only to simply registering the aforementioned
coconut product processors for the purpose of monitoring their volumes of production, administration of
quality standards with the corresponding service fees/charges.
ADOPTED this 24th day of March 1993, at Quezon City. 3
The PCA then proceeded to issue "certificates of registration" to those wishing to operate desiccated coconut
processing plants, prompting petitioner to appeal to the Office of the President of the Philippines on April 26,
1993 not to approve the resolution in question. Despite follow-up letters sent on May 25 and June 2, 1993,
petitioner received no reply from the Office of the President. The "certificates of registration" issued in the
meantime by the PCA has enabled a number of new coconut mills to operate. Hence this petition.
Petitioner alleges:
I
RESPONDENT PCA'S BOARD RESOLUTION NO. 018-93 IS NULL AND VOID FOR BEING AN
UNDUE EXERCISE OF LEGISLATIVE POWER BY AN ADMINISTRATIVE BODY.
II
ASIDE FROM BEING ULTRA-VIRES, BOARD RESOLUTION NO. 018-93 IS WITHOUT ANY
BASIS, ARBITRARY, UNREASONABLE AND THEREFORE IN VIOLATION OF SUBSTANTIVE
DUE PROCESS OF LAW.
III

IN PASSING BOARD RESOLUTION NO. 018-93, RESPONDENT PCA VIOLATED THE

PROCEDURAL DUE PROCESS REQUIREMENT OF CONSULTATION PROVIDED IN
PRESIDENTIAL DECREE NO. 1644, EXECUTIVE ORDER NO. 826 AND PCA
ADMINISTRATIVE ORDER NO. 002, SERIES OF 1991.
On the other hand, in addition to answering petitioner's arguments, respondent PCA alleges that this petition
should be denied on the ground that petitioner has a pending appeal before the Office of the President.
Respondent accuses petitioner of forum-shopping in filing this petition and of failing to exhaust available
administrative remedies before coming to this Court. Respondent anchors its argument on the general rule that
one who brings an action under Rule 65 must show that one has no appeal nor any plain, speedy, and adequate
remedy in the ordinary course of law.
I.
The rule of requiring exhaustion of administrative remedies before a party may seek judicial review, so
strenuously urged by the Solicitor General on behalf of respondent, has obviously no application here. The
resolution in question was issued by the PCA in the exercise of its rule-making or legislative power. However,
only judicial review of decisions of administrative agencies made in the exercise of their quasi-judicial function
is subject to the exhaustion doctrine. The exhaustion doctrine stands as a bar to an action which is not yet
complete 4 and it is clear, in the case at bar, that after its promulgation the resolution of the PCA abandoning
regulation of the desiccated coconut industry became effective. To be sure, the PCA is under the direct
supervision of the President of the Philippines but there is nothing in P.D. No. 232, P.D. No. 961, P.D. No. 1468
and P.D. No. 1644 defining the powers and functions of the PCA which requires rules and regulations issued by
it to be approved by the President before they become effective.
In any event, although the APCD has appealed the resolution in question to the Office of the President,
considering the fact that two months after they had sent their first letter on April 26, 1993 they still had to hear
from the President's office, meanwhile respondent PCA was issuing certificates of registration indiscriminately
to new coconut millers, we hold that petitioner was justified in filing this case on June 25, 1993. 5 Indeed, after
writing the Office of the President on April 26, 1993 6 petitioner sent inquiries to that office not once, but twice,
on May 26, 1993 7and on June 2, 1993, 8 but petitioner did not receive any reply.
II.
We now turn to the merit of the present petition. The Philippine Coconut Authority was originally created by
P.D. 232 on June 30, 1973, to take over the powers and functions of the Coconut Coordinating Council, the
Philippine Coconut Administration and the Philippine Coconut Research Institute. On June 11, 1978, by P.D.
No. 1468, it was made "an independent public corporation . . . directly reporting to, and supervised by, the
President of the Philippines," 9 and charged with carrying out the State's policy "to promote the rapid integrated
development and growth of the coconut and other palm oil industry in all its aspects and to ensure that the
coconut farmers become direct participants in, and beneficiaries of, such development and growth." 10 through a
regulatory scheme set up by law. 11
Through this scheme, the government, on August 28, 1982, temporarily prohibited the opening of new coconut
processing plants and, four months later, phased out some of the existing ones in view of overproduction in the
coconut industry which resulted in cut-throat competition, underselling and smuggling of poor quality products
and ultimately in the decline of the export performance of coconut-based commodities. The establishment of
new plants could be authorized only upon determination by the PCA of the existence of certain economic
conditions and the approval of the President of the Philippines. Thus, Executive Order No. 826, dated August
28, 1982, provided:

Sec. 1. Prohibition. Except as herein provided, no government agency or instrumentality shall

hereafter authorize, approve or grant any permit or license for the establishment or operation of new
desiccated coconut processing plants, including the importation of machinery or equipment for the
purpose. In the event of a need to establish a new plant, or expand the capacity, relocate or upgrade the
efficiencies of any existing desiccated plant, the Philippine Coconut Authority may, upon proper
determination of such need and evaluation of the condition relating to:
a. the existing market demand;
b. the production capacity prevailing in the country or locality;
c. the level and flow of raw materials; and
d. other circumstances which may affect the growth or viability of the industry concerned,
authorize or grant the application for, the establishment or expansion of capacity, relocation or
upgrading of efficiencies of such desiccated coconut processing plant, subject to the approval of the
President.
On December 6, 1982, a phase-out of some of the existing plants was ordered by the government after finding
that "a mere freeze in the present capacity of existing plants will not afford a viable solution to the problem
considering that the total available limited market is not adequate to support all the existing processing plants,
making it imperative to reduce the number of existing processing plants." 12 Accordingly, it was ordered: 13
Sec. 1. The Philippine Coconut Authority is hereby ordered to take such action as may be necessary to
reduce the number of existing desiccated coconut processing plants to a level which will insure the
survival of the remaining plants. The Authority is hereby directed to determine which of the existing
processing plants should be phased out and to enter into appropriate contracts with such plants for the
above purpose.
It was only on October 23, 1987 when the PCA adopted Resolution No. 058-87, authorizing the establishment
and operation of additional DCN plants, in view of the increased demand for desiccated coconut products in the
world's markets, particularly in Germany, the Netherlands and Australia. Even then, the opening of new plants
was made subject to "such implementing guidelines to be set forth by the Authority" and "subject to the final
approval of the President."
The guidelines promulgated by the PCA, as embodied in Administrative Order No. 002, series of 1991, inter
aliaauthorized the opening of new plants in "non-congested areas only as declared by the PCA" and subject to
compliance by applicants with "all procedures and requirements for registration under Administrative Order No.
003, series of 1981 and this Order." In addition, as the opening of new plants was premised on the increased
global demand for desiccated coconut products, the new entrants were required to submit sworn statements of
the names and addresses of prospective foreign buyers.
This form of "deregulation" was approved by President Aquino in her memorandum, dated February 11, 1988,
to the PCA. Affirming the regulatory scheme, the President stated in her memorandum:
It appears that pursuant to Executive Order No. 826 providing measures for the protection of the
Desiccated Coconut Industry, the Philippine Coconut Authority evaluated the conditions relating to: (a)
the existing market demands; (b) the production capacity prevailing in the country or locality; (c) the
level and flow of raw materials; and (d) other circumstances which may affect the growth or viability of
the industry concerned and that the result of such evaluation favored the expansion of production and
market of desiccated coconut products.

In view hereof and the favorable recommendation of the Secretary of Agriculture, the deregulation of
the Desiccated Coconut Industry as recommended in Resolution No. 058-87 adopted by the PCA
Governing Board on October 28, 1987 (sic) is hereby approved. 14
These measures the restriction in 1982 on entry into the field, the reduction the same year of the number of
the existing coconut mills and then the lifting of the restrictions in 1987 were adopted within the framework
of regulation as established by law "to promote the rapid integrated development and growth of the coconut and
other palm oil industry in all its aspects and to ensure that the coconut farmers become direct participants in,
and beneficiaries of, such development and growth." 15 Contrary to the assertion in the dissent, the power given
to the Philippine Coconut Authority and before it to the Philippine Coconut Administration "to formulate
and adopt a general program of development for the coconut and other palm oils industry" 16 is not a roving
commission to adopt any program deemed necessary to promote the development of the coconut and other palm
oils industry, but one to be exercised in the context of this regulatory structure.
In plain disregard of this legislative purpose, the PCA adopted on March 24, 1993 the questioned resolution
which allows not only the indiscriminate opening of new coconut processing plants but the virtual dismantling
of the regulatory infrastructure whereby, forsaking controls theretofore placed in its keeping, the PCA limits its
function to the innocuous one of "monitoring" compliance by coconut millers with quality standards and
volumes of production. In effect, the PCA would simply be compiling statistical data on these matters, but in
case of violations of standards there would be nothing much it would do. The field would be left without an
umpire who would retire to the bleachers to become a mere spectator. As the PCA provided in its Resolution
No. 018-93:
NOW, THEREFORE, BE IT RESOLVED AS IT IS HEREBY RESOLVED, that, henceforth, PCA
shall no longer require any coconut oil mill, coconut oil refinery, coconut desiccator, coconut product
processor/factory, coconut fiber plant or any similar coconut processing plant to apply with PCA and the
latter shall no longer issue any form of license or permit as condition prior to establishment or operation
of such mills or plants;
RESOLVED, FURTHER, that the PCA shall limit itself only to simply registering the aforementioned
coconut product processors for the purpose of monitoring their volumes of production, administration of
quality standards with the corresponding service fees/charges.
The issue is not whether the PCA has the power to adopt this resolution to carry out its mandate under the law
"to promote the accelerated growth and development of the coconut and other palm oil industry." 17 The issue
rather is whether it can renounce the power to regulate implicit in the law creating it for that is what the
resolution in question actually is.
Under Art. II, 3(a) of the Revised Coconut Code (P.D. No. 1468), the role of the PCA is "To formulate and
adopt a general program of development for the coconut and other palm oil industry in all its aspects." By
limiting the purpose of registration to merely "monitoring volumes of production [and] administration of quality
standards" of coconut processing plants, the PCA in effect abdicates its role and leaves it almost completely to
market forces how the coconut industry will develop.
Art. II, 3 of P.D. No. 1468 further requires the PCA:
(h) To regulate the marketing and the exportation of copra and its by-products by establishing standards
for domestic trade and export and, thereafter, to conduct an inspection of all copra and its by-products
proposed for export to determine if they conform to the standards established;
Instead of determining the qualifications of market players and preventing the entry into the field of those who
are unfit, the PCA now relies entirely on competition with all its wastefulness and inefficiency to do the

weeding out, in its naive belief in survival of the fittest. The result can very well be a repeat of 1982 when free
enterprise degenerated into a "free-for-all," resulting in cut-throat competition, underselling, the production of
inferior products and the like, which badly affected the foreign trade performance of the coconut industry.
Indeed, by repudiating its role in the regulatory scheme, the PCA has put at risk other statutory provisions,
particularly those of P.D. No. 1644, to wit:
Sec. 1. The Philippine Coconut Authority shall have full power and authority to regulate the marketing
and export of copra, coconut oil and their by-products, in furtherance of the steps being taken to
rationalize the coconut oil milling industry.
Sec. 2. In the exercise of its powers under Section 1 hereof, the Philippine Coconut Authority may
initiate and implement such measures as may be necessary to attain the rationalization of the coconut oil
milling industry, including, but not limited to, the following measures:
(a) Imposition of floor and/or ceiling prices for all exports of copra, coconut oil and their by-products;
(b) Prescription of quality standards;
(c) Establishment of maximum quantities for particular periods and particular markets;
(d) Inspection and survey of export shipments through an independent international superintendent or
surveyor.
In the exercise of its powers hereunder, the Philippine Coconut Authority shall consult with, and be
guided by, the recommendation of the coconut farmers, through corporations owned or controlled by
them through the Coconut Industry Investment Fund and the private corporation authorized to be
organized under Letter of Instructions No. 926.
and the Revised Coconut Code (P.D. No. 1468), Art. II, 3, to wit:
(m) Except in respect of entities owned or controlled by the Government or by the coconut farmers
under Sections 9 and 10, Article III hereof, the Authority shall have full power and authority to regulate
the production, distribution and utilization of all subsidized coconut-based products, and to require the
submission of such reports or documents as may be deemed necessary by the Authority to ascertain
whether the levy payments and/or subsidy claims are due and correct and whether the subsidized
products are distributed among, and utilized by, the consumers authorized by the Authority.
The dissent seems to be saying that in the same way that restrictions on entry into the field were imposed in
1982 and then relaxed in 1987, they can be totally lifted now without prejudice to reimposing them in the future
should it become necessary to do so. There is really no renunciation of the power to regulate, it is claimed.
Trimming down of PCA's function to registration is not an abdication of the power to regulate but is regulation
itself. But how can this be done when, under Resolution No. 018-93, the PCA no longer requires a license as
condition for the establishment or operation of a plant? If a number of processing firms go to areas which are
already congested, the PCA cannot stop them from doing so. If there is overproduction, the PCA cannot order a
cut back in their production. This is because the licensing system is the mechanism for regulation. Without it the
PCA will not be able to regulate coconut plants or mills.
In the first "whereas" clause of the questioned resolution as set out above, the PCA invokes a policy of free
enterprise that is "unhampered by protective regulations and unnecessary bureaucratic red tape" as justification
for abolishing the licensing system. There can be no quarrel with the elimination of "unnecessary red tape."

That is within the power of the PCA to do and indeed it should eliminate red tape. Its success in doing so will be
applauded. But free enterprise does not call for removal of "protective regulations."
Our Constitutions, beginning with the 1935 document, have repudiated laissez-faire as an economic
principle. 18Although the present Constitution enshrines free enterprise as a policy, 19 it nonetheless reserves to
the government the power to intervene whenever necessary to promote the general welfare. This is clear from
the following provisions of Art. XII of the Constitution which, so far as pertinent, state:
Sec. 6. . . . Individuals and private groups, including corporations, cooperatives, and similar collective
organizations, shall have the right to own, establish, and operate economic enterprises, subject to the
duty of the State to promote distributive justice and to intervene when the common good so demands.
Sec. 19. The State shall regulate or prohibit monopolies when the public interest so requires. No
combinations in restraint of trade or unfair competition shall be allowed. (Emphasis added).
At all events, any change in policy must be made by the legislative department of the government. The
regulatory system has been set up by law. It is beyond the power of an administrative agency to dismantle it.
Indeed, petitioner charges the PCA of seeking to render moot a case filed by some of its members questioning
the grant of licenses to certain parties by adopting the resolution in question. It is alleged that members of
petitioner complained to the court that the PCA had authorized the establishment and operation of new plants in
areas which were already crowded, in violation of its Administrative Order No. 002, series of 1991. In response,
the Regional Trial Court issued a writ of preliminary injunction, enjoining the PCA from issuing licenses to the
private respondent in that case.
These allegations of petitioner have not been denied here. It would thus seem that instead of defending its
decision to allow new entrants into the field against petitioner's claim that the PCA decision violated the
guidelines in Administrative Order No. 002, series of 1991, the PCA adopted the resolution in question to
render the case moot. In so doing, the PCA abdicated its function of regulation and left the field to untrammeled
competition that is likely to resurrect the evils of cut-throat competition, underselling and overproduction which
in 1982 required the temporary closing of the field to new players in order to save the industry.
The PCA cannot rely on the memorandum of then President Aquino for authority to adopt the resolution in
question. As already stated, what President Aquino approved in 1988 was the establishment and operation of
new DCN plants subject to the guidelines to be drawn by the PCA. 20 In the first place, she could not have
intended to amend the several laws already mentioned, which set up the regulatory system, by a mere
memoranda to the PCA. In the second place, even if that had been her intention, her act would be without effect
considering that, when she issued the memorandum in question on February 11, 1988, she was no longer vested
with legislative authority. 21
WHEREFORE, the petition is GRANTED. PCA Resolution No. 018-93 and all certificates of registration
issued under it are hereby declared NULL and VOID for having been issued in excess of the power of the
Philippine Coconut Authority to adopt or issue.
SO ORDERED.
Narvasa, C.J., Regalado, Davide, Jr., Puno, Kapunan, Francisco, Panganiban and Martinez, JJ., concur.

Separate Opinions

ROMERO, J., dissenting;

The past decade, a distinct worldwide trend towards economic deregulation has been evident. Both developed
and developing countries have seriously considered, and extensively adopted, various measures for this purpose.
The Philippines has been no exception.
To this end, the Philippine Coconut Authority (PCA) issued Board Resolution No. 018-93 (PCA-BR No 01893) dated March 24, 1993, deregulating the coconut processing plant industry. 1 The Association of Philippine
Desiccators (APCD) has filed this instant petition for prohibition and mandamus under Rule 65 of the Rules of
Court seeking the annulment of said resolution.
APCD questions the validity of PCA-BR No. 018-93 for being violative of the principle of non-delegability of
legislative power. It contends that in issuing the resolution deregulating the coconut industry, the PCA exercised
legislative discretion, which has not been delegated to it by Congress. It adds that when PCA deregulated the
coconut industry, it ran counter to the very laws 2 which mandated it to regulate and rationalize the industry.
We see no merit in this contention. PCA's authority to issue PCA-BR No. 018-93 is clearly provided in Section
3(a) of P.D. No. 232, reading as follows:
. . . To formulate and adopt a general program of development for the coconut and other palm oil
industry.
Similar grants of authority were made in subsequent amendatory laws. 3
In this regard, we have ruled that legislative discretion, as to the substantive contents of a law, cannot be
delegated. What may be delegated is the discretion to determine how the law is to be enforced, not what the law
should be, a prerogative of the legislature which it can neither abdicate nor surrender to the delegate. 4 The
principle is based on the separation and allocation of powers among the three departments of government. 5
Thus, there are two accepted tests to determine whether or not there is a valid delegation of legislative power,
namely, the completeness test and the sufficient standard test. Under the first test, the law must be complete in
all its terms and conditions when it leaves the legislature such that when it reaches the delegate, the only thing
he will have to do is enforce it. Under the sufficient standard test, there must be adequate guidelines or
limitations in the law to map out the boundaries of the delegate's authority and prevent the delegation from
running amiss. 6
We have accepted as sufficient standards "interest of law and order," 7 "adequate and efficient
instruction," 8 "public interest," 9 "justice and equity," 10 "public convenience and welfare," 11 "simplicity,
economy and efficiency," 12"standardization and regulation of medical education," 13 and "fair and equitable
employment practices." 14 Consequently, the standard may be expressed or implied. In the former, the non
delegation objection is easily met. The standard though does not have to be spelled out but need only be implied
from the policy and purpose of the act considered as a whole. 15 It may also be found in other statutes on the
same subject as that of the challenged legislation. 16
In no uncertain terms must it be stressed that the function of promulgating rules and regulations may be
legitimately exercised only for the purpose of carrying out the provisions of a law. The power of administrative
agencies is confined to implementing the law or putting it into effect. Corollary to this guideline is that
administrative regulation cannot extend the law and amend a legislative enactment. 17

In the instant case, we believe that the PCA did not overstep the limits of its power in issuing the assailed
resolution. We need not belabor the point that one of the economic goals of our country is the increased
productivity of goods and services provided by the nation for the benefit of the people, 18 since from a purely
economic standpoint, the increase in agricultural productivity is of fundamental importance. 19
Considering the responsibilities and powers assigned to the PCA, as well as its underlying policy, namely, that
"the economic well-being of a major part of the population depends to a large extent on the viability of the
industry and its improvement in the areas of production, processing and marketing," the irresistible conclusion
is that PCA-BR No. 018-93 is a valid exercise of delegated legislation by the PCA. Such resolution is in
harmony with the objectives sought to be achieved by the laws regarding the coconut industry, particularly "to
promote accelerated growth and development of the coconut and other palm oil industry," 20 and "rapid
integrated development and growth of the coconut and other palm oil industry." 21 These are sufficient standards
to guide the PCA. Thus, measures to achieve these policies are better left to the administrative agencies tasked
with implementing them.
It must be stressed that with increasing global trade and business and major upheavals in technology and
communications, the time has come for administrative policies and regulations to adapt to ever-changing
business needs rather than to accommodate traditional acts of the legislature. 22 Even the 1987 Constitution was
designed to meet, not only contemporary events, but also future and unknown circumstances. 23
It is worth mentioning that the PCA, after conducting its studies, adopted the policy of deregulation to further
enhance the coconut industry competition, since any continuation of the restrictive regulation in the industry
would have detrimental effects. 24 This is in consonance with the constitutional mandate that the State must
"adopt measures that help make them (locally produced goods) competitive." 25 Undoubtedly, an "agency, in
light of changing circumstances, is free to alter interpretative and policy views reflected in regulations
construing an underlying statute, so long as any changed construction of the statute is consistent with express
congressional intent or embodies a permissible reading of the statute." 26
Furthermore, the Constitution is cognizant of the realities of global interdependency, as it requires the pursuit of
"a trade policy that serves the general welfare and utilizes all forms and arrangements of exchanges on the basis
of equality and reciprocity." 27
In sum, the policy of deregulation must be determined by the circumstances prevailing in a certain
situation. 28 As we have stressed in the past, this Court is only concerned with the question of authority, not the
wisdom of the measure involved which falls within the province of the Legislature.
The ponencia presents the issue: whether it is within the power of the PCA to renounce the power to regulate
implicit in the law creating it (P.D. No. 232). (It is to be pointed out that this issue was not included in the
Assignment of Errors of Petitioner).
Underlying this formulation is the assumption/admission that PCA has the power to regulate the coconut
industry, as in fact the power is bestowed upon it by its organic act, P.D. No. 232, viz. "to promote the rapid
integrated development and growth of the coconut and other palm oils in industry in all its aspects and to ensure
that the coconut farmers become direct participants in, and beneficiaries of, such development and growth." Its
broad mandate is "to formulate and adopt a general program of development for the coconut and other palm oils
industry."
It avers that this "legislative scheme" was disregarded when the PCA adopted on March 24, 1993 the assailed
Resolution which is effect liberalized the registration and licensing requirements for the granting of permits to
operate new coconut plants. But this was effected pursuant to the October 23, 1987 PCA Board Resolution
laying down the policy of deregulating the industry and authorizing the creation of additional desiccated
coconut plants.

As with any administrative agency established to promote the growth and development of any industry, the
PCA has considerable latitude to adopt policies designed to accelerate the attainment of this objective and
corollarily, to lay down rules and regulations to implement the same. We can take judicial notice of the fact that
during its 25 years of existence, the PCA has achieved enough experience and expertise to introduce measures
which shall ensure the dominant role of the crop as a major dollar-producing industry, including the
manipulation of market forces to our comparative advantage, certainly an area beyond the Court's ken.
Hence, guided by guidelines already laid down, it responded to regional developments by:
(1) taking cognizance of the overproduction in the industry and curtailing the expansion of coconut processing
plants in 1982, within reasonable limits and with safeguards (hence the issuance of Executive Order Nos. 826
on August 28, 1982 and No. 854 on December 6, 1982);
(2) five years later, responding to the demand for desiccated coconut products in the world market, liberalized
its former policy by deregulating the industry and authorizing the creation of additional desiccated coconut
plants in 1987;
(3) complementing and supplementing (2), by easing registration and licensing requirements in 1993.
It bears repeating that the above measures were not taken arbitrarily but in careful compliance with guidelines
incorporated in the Executive Orders and subject to the favorable recommendation of the Secretary of
Agriculture and the approval of the President.
The crux of the ponencia is that, in the process of opening doors to foreign markets, the PCA "limited itself to
merely monitoring their volumes of production and administration of quality standards, in effect abdicating its
role and leaving it almost totally to market forces to define how the industry will develop."
Actually, the relevant provisions in the disputed resolution reads:
Resolved further, that the PCA shall limit itself only to simply registering the aforementioned coconut
product processors for the purpose of monitoring their volumes of production, administration of quality
standards with the corresponding service fees/charges.
For the sake of clarity and accuracy, it is to be stressed that the PCA did not limit itself "merely to monitoring . .
." as the ponencia states, but to "registering the . . . processors for the purpose of monitoring their volumes of
production and administration of quality standards. . . ."
In the actual words of the Resolution, the PCA recognizes its principal function of registration so as to be able
to monitor the production and administer quality standards, both objectives of which are not merely nominal or
minimal, but substantial, even vital, aspects of the power to regulate. Put differently, there is no renunciation of
the power to regulate, for the regulation is essentially recognized and accomplished through the registration
function which enables the PCA to keep track of the volume of production and the observance of quality
standards by new entrants into the industry. In sum, trimming down its functions to registration is not an
abdication of the power to regulate but is regulation itself.
If the PCA, in light of the crucial developments in the regional and domestic coconut industry decides to open
wide its doors, allow the free entry of other players and the interplay of competitive forces to shape the
configuration of the industry, who are we to declare such policy as one characterized by "wastefulness and
inefficiency . . . based on its naive faith in survival of the fittest." Is not this a blatant incursion by the Court into
the economic arena which is better left to the administrative agency precisely tasked to promote the growth of
the industry, through the exercise of its studied discretion? To be sure, those operators already in the field, such
as the petitioner members of the Association of Philippine Coconut Desiccators, are expected to vigorously

protest and work for the nullity of what they perceive as an obnoxious, life threatening policy. But instead of
opposing what the PCA views as a timely, well-considered move, the healthy competition should spur them to
improving their product and elevating the standards they have imposed on themselves.
If, in the course of its monitoring which is a piece of the regulatory function, the PCA should detect a violation
of its guidelines that would result in a lowering of the quality of the product, or unfairness to other players,
surely, it is not powerless to impose sanctions, as categorically provided in P.D. 1469, P.D. 1644, Adm. Order
No. 003, Series of 1981 and Adm. Order No. 002, Series of 1991. Any administrative agency is empowered to
establish its implementing rules, together with sanctions guaranteed to ensure the observance of such rules, else
it would be a mere "toothless" entity.
The ponencia prognosticates, "The result can very well be a repeat of 1982 when free enterprise degenerated
into a 'free-for-all,' resulting in cutthroat competition, underselling, the production of inferior products and the
like, which badly affected the foreign trade performance of our coconut industry." Are we not encroaching on
legislative domain in questioning the wisdom of the action taken by the PCA which was accorded a broad
mandate by the Congress? Moreover, let us bear in mind that during those "abnormal times," forces other than
merely economic, e.g. political, dominated the economy effectively supporting, even favoring, destructive
capitalistic monopolies and, in the process suppressing healthy competition.
Not to forget, too, that we cannot close our eyes and ignore the world-wide trend towards globalization in the
economy, as in other fields, as in fact the Court recognized this economic reality in its decision in the Oil
Deregulation Case.
With the unrelenting march of globalization in our economy, the Philippines must find its market niches and be
able to adapt to these inevitable changes, for the Asia-Pacific rim is bound to become a truly dynamic region in
the economic, political and cultural arenas in the coming millennium.
ACCORDINGLY, the petition should be DISMISSED.
Bellosillo, Melo, Vitug, Quisumbing and Purisima, JJ., dissent.

Separate Opinions
ROMERO, J., dissenting;
The past decade, a distinct worldwide trend towards economic deregulation has been evident. Both developed
and developing countries have seriously considered, and extensively adopted, various measures for this purpose.
The Philippines has been no exception.
To this end, the Philippine Coconut Authority (PCA) issued Board Resolution No. 018-93 (PCA-BR No 01893) dated March 24, 1993, deregulating the coconut processing plant industry. 1 The Association of Philippine
Desiccators (APCD) has filed this instant petition for prohibition and mandamus under Rule 65 of the Rules of
Court seeking the annulment of said resolution.
APCD questions the validity of PCA-BR No. 018-93 for being violative of the principle of non-delegability of
legislative power. It contends that in issuing the resolution deregulating the coconut industry, the PCA exercised
legislative discretion, which has not been delegated to it by Congress. It adds that when PCA deregulated the
coconut industry, it ran counter to the very laws 2 which mandated it to regulate and rationalize the industry.

We see no merit in this contention. PCA's authority to issue PCA-BR No. 018-93 is clearly provided in Section
3(a) of P.D. No. 232, reading as follows:
. . . To formulate and adopt a general program of development for the coconut and other palm oil
industry.
Similar grants of authority were made in subsequent amendatory laws. 3
In this regard, we have ruled that legislative discretion, as to the substantive contents of a law, cannot be
delegated. What may be delegated is the discretion to determine how the law is to be enforced, not what the law
should be, a prerogative of the legislature which it can neither abdicate nor surrender to the delegate. 4 The
principle is based on the separation and allocation of powers among the three departments of government. 5
Thus, there are two accepted tests to determine whether or not there is a valid delegation of legislative power,
namely, the completeness test and the sufficient standard test. Under the first test, the law must be complete in
all its terms and conditions when it leaves the legislature such that when it reaches the delegate, the only thing
he will have to do is enforce it. Under the sufficient standard test, there must be adequate guidelines or
limitations in the law to map out the boundaries of the delegate's authority and prevent the delegation from
running amiss. 6
We have accepted as sufficient standards "interest of law and order," 7 "adequate and efficient
instruction," 8 "public interest," 9 "justice and equity," 10 "public convenience and welfare," 11 "simplicity,
economy and efficiency," 12"standardization and regulation of medical education," 13 and "fair and equitable
employment practices." 14 Consequently, the standard may be expressed or implied. In the former, the non
delegation objection is easily met. The standard though does not have to be spelled out but need only be implied
from the policy and purpose of the act considered as a whole. 15 It may also be found in other statutes on the
same subject as that of the challenged legislation. 16
In no uncertain terms must it be stressed that the function of promulgating rules and regulations may be
legitimately exercised only for the purpose of carrying out the provisions of a law. The power of administrative
agencies is confined to implementing the law or putting it into effect. Corollary to this guideline is that
administrative regulation cannot extend the law and amend a legislative enactment. 17
In the instant case, we believe that the PCA did not overstep the limits of its power in issuing the assailed
resolution. We need not belabor the point that one of the economic goals of our country is the increased
productivity of goods and services provided by the nation for the benefit of the people, 18 since from a purely
economic standpoint, the increase in agricultural productivity is of fundamental importance. 19
Considering the responsibilities and powers assigned to the PCA, as well as its underlying policy, namely, that
"the economic well-being of a major part of the population depends to a large extent on the viability of the
industry and its improvement in the areas of production, processing and marketing," the irresistible conclusion
is that PCA-BR No. 018-93 is a valid exercise of delegated legislation by the PCA. Such resolution is in
harmony with the objectives sought to be achieved by the laws regarding the coconut industry, particularly "to
promote accelerated growth and development of the coconut and other palm oil industry," 20 and "rapid
integrated development and growth of the coconut and other palm oil industry." 21 These are sufficient standards
to guide the PCA. Thus, measures to achieve these policies are better left to the administrative agencies tasked
with implementing them.
It must be stressed that with increasing global trade and business and major upheavals in technology and
communications, the time has come for administrative policies and regulations to adapt to ever-changing
business needs rather than to accommodate traditional acts of the legislature. 22 Even the 1987 Constitution was
designed to meet, not only contemporary events, but also future and unknown circumstances. 23

It is worth mentioning that the PCA, after conducting its studies, adopted the policy of deregulation to further
enhance the coconut industry competition, since any continuation of the restrictive regulation in the industry
would have detrimental effects. 24 This is in consonance with the constitutional mandate that the State must
"adopt measures that help make them (locally produced goods) competitive." 25 Undoubtedly, an "agency, in
light of changing circumstances, is free to alter interpretative and policy views reflected in regulations
construing an underlying statute, so long as any changed construction of the statute is consistent with express
congressional intent or embodies a permissible reading of the statute." 26
Furthermore, the Constitution is cognizant of the realities of global interdependency, as it requires the pursuit of
"a trade policy that serves the general welfare and utilizes all forms and arrangements of exchanges on the basis
of equality and reciprocity." 27
In sum, the policy of deregulation must be determined by the circumstances prevailing in a certain
situation. 28 As we have stressed in the past, this Court is only concerned with the question of authority, not the
wisdom of the measure involved which falls within the province of the Legislature.
The ponencia presents the issue: whether it is within the power of the PCA to renounce the power to regulate
implicit in the law creating it (P.D. No. 232). (It is to be pointed out that this issue was not included in the
Assignment of Errors of Petitioner).
Underlying this formulation is the assumption/admission that PCA has the power to regulate the coconut
industry, as in fact the power is bestowed upon it by its organic act, P.D. No. 232, viz. "to promote the rapid
integrated development and growth of the coconut and other palm oils in industry in all its aspects and to ensure
that the coconut farmers become direct participants in, and beneficiaries of, such development and growth." Its
broad mandate is "to formulate and adopt a general program of development for the coconut and other palm oils
industry."
It avers that this "legislative scheme" was disregarded when the PCA adopted on March 24, 1993 the assailed
Resolution which is effect liberalized the registration and licensing requirements for the granting of permits to
operate new coconut plants. But this was effected pursuant to the October 23, 1987 PCA Board Resolution
laying down the policy of deregulating the industry and authorizing the creation of additional desiccated
coconut plants.
As with any administrative agency established to promote the growth and development of any industry, the
PCA has considerable latitude to adopt policies designed to accelerate the attainment of this objective and
corollarily, to lay down rules and regulations to implement the same. We can take judicial notice of the fact that
during its 25 years of existence, the PCA has achieved enough experience and expertise to introduce measures
which shall ensure the dominant role of the crop as a major dollar-producing industry, including the
manipulation of market forces to our comparative advantage, certainly an area beyond the Court's ken.
Hence, guided by guidelines already laid down, it responded to regional developments by:
(1) taking cognizance of the overproduction in the industry and curtailing the expansion of coconut processing
plants in 1982, within reasonable limits and with safeguards (hence the issuance of Executive Order Nos. 826
on August 28, 1982 and No. 854 on December 6, 1982);
(2) five years later, responding to the demand for desiccated coconut products in the world market, liberalized
its former policy by deregulating the industry and authorizing the creation of additional desiccated coconut
plants in 1987;
(3) complementing and supplementing (2), by easing registration and licensing requirements in 1993.

It bears repeating that the above measures were not taken arbitrarily but in careful compliance with guidelines
incorporated in the Executive Orders and subject to the favorable recommendation of the Secretary of
Agriculture and the approval of the President.
The crux of the ponencia is that, in the process of opening doors to foreign markets, the PCA "limited itself to
merely monitoring their volumes of production and administration of quality standards, in effect abdicating its
role and leaving it almost totally to market forces to define how the industry will develop."
Actually, the relevant provisions in the disputed resolution reads:
Resolved further, that the PCA shall limit itself only to simply registering the aforementioned coconut
product processors for the purpose of monitoring their volumes of production, administration of quality
standards with the corresponding service fees/charges.
For the sake of clarity and accuracy, it is to be stressed that the PCA did not limit itself "merely to monitoring . .
." as the ponencia states, but to "registering the . . . processors for the purpose of monitoring their volumes of
production and administration of quality standards. . . ."
In the actual words of the Resolution, the PCA recognizes its principal function of registration so as to be able
to monitor the production and administer quality standards, both objectives of which are not merely nominal or
minimal, but substantial, even vital, aspects of the power to regulate. Put differently, there is no renunciation of
the power to regulate, for the regulation is essentially recognized and accomplished through the registration
function which enables the PCA to keep track of the volume of production and the observance of quality
standards by new entrants into the industry. In sum, trimming down its functions to registration is not an
abdication of the power to regulate but is regulation itself.
If the PCA, in light of the crucial developments in the regional and domestic coconut industry decides to open
wide its doors, allow the free entry of other players and the interplay of competitive forces to shape the
configuration of the industry, who are we to declare such policy as one characterized by "wastefulness and
inefficiency . . . based on its naive faith in survival of the fittest." Is not this a blatant incursion by the Court into
the economic arena which is better left to the administrative agency precisely tasked to promote the growth of
the industry, through the exercise of its studied discretion? To be sure, those operators already in the field, such
as the petitioner members of the Association of Philippine Coconut Desiccators, are expected to vigorously
protest and work for the nullity of what they perceive as an obnoxious, life threatening policy. But instead of
opposing what the PCA views as a timely, well-considered move, the healthy competition should spur them to
improving their product and elevating the standards they have imposed on themselves.
If, in the course of its monitoring which is a piece of the regulatory function, the PCA should detect a violation
of its guidelines that would result in a lowering of the quality of the product, or unfairness to other players,
surely, it is not powerless to impose sanctions, as categorically provided in P.D. 1469, P.D. 1644, Adm. Order
No. 003, Series of 1981 and Adm. Order No. 002, Series of 1991. Any administrative agency is empowered to
establish its implementing rules, together with sanctions guaranteed to ensure the observance of such rules, else
it would be a mere "toothless" entity.
The ponencia prognosticates, "The result can very well be a repeat of 1982 when free enterprise degenerated
into a 'free-for-all,' resulting in cutthroat competition, underselling, the production of inferior products and the
like, which badly affected the foreign trade performance of our coconut industry." Are we not encroaching on
legislative domain in questioning the wisdom of the action taken by the PCA which was accorded a broad
mandate by the Congress? Moreover, let us bear in mind that during those "abnormal times," forces other than
merely economic, e.g. political, dominated the economy effectively supporting, even favoring, destructive
capitalistic monopolies and, in the process suppressing healthy competition.

Not to forget, too, that we cannot close our eyes and ignore the world-wide trend towards globalization in the
economy, as in other fields, as in fact the Court recognized this economic reality in its decision in the Oil
Deregulation Case.
With the unrelenting march of globalization in our economy, the Philippines must find its market niches and be
able to adapt to these inevitable changes, for the Asia-Pacific rim is bound to become a truly dynamic region in
the economic, political and cultural arenas in the coming millennium.
ACCORDINGLY, the petition should be DISMISSED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 132601 January 19, 1999

LEO ECHEGARAY, petitioner,
vs.
SECRETARY OF JUSTICE, ET AL., respondents.
RESOLUTION

PUNO, J.:
For resolution are public respondents' Urgent Motion for Reconsideration of the Resolution of this Court dated
January 4, 1990 temporarily restraining the execution of petitioner and Supplemental Motion to Urgent Motion
for Reconsideration. It is the submission of public respondents that:
1. The Decision in this case having become final and executory, its execution enters the exclusive
ambit of authority of the executive authority. The issuance of the TRO may be construed as
trenching on that sphere of executive authority;
2. The issuance of the temporary restraining order . . . creates dangerous precedent as there will
never be an end to litigation because there is always a possibility that Congress may repeal a law.
3. Congress had earlier deliberated extensively on the death penalty bill. To be certain, whatever
question may now be raised on the Death Penalty Law before the present Congress within the 6month period given by this Honorable Court had in all probability been fully debated upon . . .
4. Under the time honored maxim lex futuro, judex praeterito, the law looks forward while the
judge looks at the past, . . . the Honorable Court in issuing the TRO has transcended its power of
judicial review.
5. At this moment, certain circumstances/supervening events transpired to the effect that the repeal
or modification of the law imposing death penalty has become nil, to wit:
a. The public pronouncement of President Estrada that he will veto any law imposing the
death penalty involving heinous crimes.
b. The resolution of Congressman Golez, et al., that they are against the repeal of the law;
c. The fact that Senator Roco's resolution to repeal the law only bears his signature and that
of Senator Pimentel.
In their Supplemental Motion to Urgent Motion for Reconsideration, public respondents attached a copy of
House Resolution No. 629 introduced by Congressman Golez entitled "Resolution expressing the sense of the
House of Representative to reject any move to review Republic Act No. 7659 which provided for the reimposition of death penalty, notifying the Senate, the Judiciary and the Executive Department of the position of
the House of Representative on this matter, and urging the President to exhaust all means under the law to
immediately implement the death penalty law." The Resolution was concurred in by one hundred thirteen (113)
congressman.

In their Consolidated Comment, petitioner contends: (1) the stay order. . . is within the scope of judicial power
and duty and does not trench on executive powers nor on congressional prerogatives; (2) the exercise by this
Court of its power to stay execution was reasonable; (3) the Court did not lose jurisdiction to address incidental
matters involved or arising from the petition; (4) public respondents are estopped from challenging the Court's
jurisdiction; and (5) there is no certainty that the law on capital punishment will not be repealed or modified
until Congress convenes and considers all the various resolutions and bills filed before it.
Prefatorily, the Court likes to emphasize that the instant motions concern matters that are not incidents in G.R.
No. 117472, where the death penalty was imposed on petitioner on automatic review of his conviction by this
Court. The instant motions were filed in this case, G.R. No. 132601, where the constitutionality of R.A. No.
8177 (Lethal Injection Law) and its implementing rules and regulations was assailed by petitioner. For this
reason, the Court in its Resolution of January 4, 1999 merely noted the Motion to Set Aside of Rodessa "Baby"
R. Echegaray dated January 7, 1999 and Entry of Appearance of her counsel dated January 5, 1999. Clearly, she
has no legal standing to intervene in the case at bar, let alone the fact that the interest of the State is properly
represented by the Solicitor General.
We shall now resolve the basic issues raised by the public respondents.
I
First. We do not agree with the sweeping submission of the public respondents that this Court lost its
jurisdiction over the case at bar and hence can no longer restrain the execution of the petitioner. Obviously,
public respondents are invoking the rule that final judgments can no longer be altered in accord with the
principle that "it is just as important that there should be a place to end as there should be a place to begin
litigation." 1 To start with, the Court is not changing even a comma of its final Decision. It is appropriate to
examine with precision the metes and bounds of the Decision of this Court that became final. These metes and
bounds are clearly spelled out in the Entry of Judgment in this case, viz:
ENTRY OF JUDGMENT
This is to certify that on October 12, 1998 a decision rendered in the above-entitled case was
filed in this Office, the dispositive part of which reads as follows:
WHEREFORE, the petition is DENIED insofar as petitioner seeks to declare the
assailed statute (Republic Act No. 8177) as unconstitutional; but GRANTED
insofar as Sections 17 and 19 of the Rules and Regulations to Implement Republic
Act No. 8177 are concerned, which are hereby declared INVALID because (a)
Section 17 contravenes Article 83 of the Revised Penal Code, as amended by
Section 25 of Republic Act No. 7659; and (b) Section 19 fails to provide for
review and approval of the Lethal Injection Manual by the Secretary of Justice,
and unjustifiably makes the manual confidential, hence unavailable to interested
parties including the accused/convict and counsel. Respondents are hereby
enjoined from enforcing and implementing Republic Act No. 8177 until the
aforesaid Sections 17 and 19 of the Rules and Regulations to Implement Republic
Act No. 8177 are appropriately amended, revised and/or corrected in accordance
with this Decision.
SO ORDERED.
and that the same has, on November 6, 1988 become final and executory and is hereby recorded
in the Book of Entries of Judgment.

Manila, Philippine.
Clerk of Court
By: (SGD) TERESITA G. DIMAISIP
Acting Chief
Judicial Records Office
The records will show that before the Entry of Judgment, the Secretary of Justice, the Honorable Serafin
Cuevas, filed with this Court on October 21, 1998 a Compliance where he submitted the Amended Rules and
Regulations implementing R.A. No. 8177 in compliance with our Decision. On October 28, 1998, Secretary
Cuevas submitted a Manifestation informing the Court that he has caused the publication of the said Amended
Rules and Regulations as required by the Administrative Code. It is crystalline that the Decision of this Court
that became final and unalterable mandated: (1) that R.A. No. 8177 is not unconstitutional; (2) that sections 17
and 19 of the Rules and Regulations to Implement R.A. No. 8177 are invalid, and (3) R.A. No. 8177 cannot be
enforced and implemented until sections 17 and 19 of the Rules and Regulations to Implement R.A. No. 8177
are amended. It is also daylight clear that this Decision was not altered a whit by this Court. Contrary to the
submission of the Solicitor General, the rule on finality of judgment cannot divest this Court of its jurisdiction
to execute and enforce the same judgment. Retired Justice Camilo Quiason synthesized the well established
jurisprudence on this issue as
follows: 2
xxx xxx xxx
the finality of a judgment does not mean that the Court has lost all its powers nor the case. By the
finality of the judgment, what the court loses is its jurisdiction to amend, modify or alter the
same. Even after the judgment has become final the court retains its jurisdiction to execute and
enforce it. 3There is a difference between the jurisdiction of the court to execute its judgment and
its jurisdiction to amend, modify or alter the same. The former continues even after the judgment
has become final for the purpose of enforcement of judgment; the latter terminates when the
judgment becomes final. 4 . . . For after the judgment has become final facts and circumstances
may transpire which can render the execution unjust or impossible.5
In truth, the arguments of the Solicitor General has long been rejected by this Court. As aptly pointed out by the
petitioner, as early as 1915, this Court has unequivocably ruled in the case of Director of Prisons v. Judge of
First Instance, 6 viz:
This Supreme Court has repeatedly declared in various decisions, which constitute jurisprudence
on the subject, that in criminal cases, after the sentence has been pronounced and the period for
reopening the same cannot change or alter its judgment, as its jurisdiction has terminated . . .
When in cases of appeal or review the cause has been returned thereto for execution, in the event
that the judgment has been affirmed, it performs a ministerial duty in issuing the proper order.
But it does not follow from this cessation of functions on the part of the court with reference to
the ending of the cause that the judicial authority terminates by having then passed completely to
the Executive. The particulars of the execution itself, which are certainly not always included in
the judgment and writ of execution, in any event are absolutely under the control of the judicial
authority, while the executive has no power over the person of the convict except to provide for
carrying out of the penalty and to pardon.

Getting down to the solution of the question in the case at bar, which is that of execution of a
capital sentence, it must be accepted as a hypothesis that postponement of the date can be
requested. There can be no dispute on this point. It is a well-known principle that
notwithstanding the order of execution and the executory nature thereof on the date set or at the
proper time, the date therefor can be postponed, even in sentences of death. Under the common
law this postponement can be ordered in three ways: (1) By command of the King; (2) by
discretion (arbitrio) of the court; and (3) by mandate of the law. It is sufficient to state this
principle of the common law to render impossible that assertion in absolute terms that after the
convict has once been placed in jail the trial court can not reopen the case to investigate the facts
that show the need for postponement. If one of the ways is by direction of the court, it is
acknowledged that even after the date of the execution has been fixed, and notwithstanding the
general rule that after the (court) has performed its ministerial duty of ordering the execution . . .
and its part is ended, if however a circumstance arises that ought to delay the execution, and
there is an imperative duty to investigate the emergency and to order a postponement. Then the
question arises as to whom the application for postponing the execution ought to be addressed
while the circumstances is under investigation and so to who has jurisdiction to make the
investigation.
The power to control the execution of its decision is an essential aspect of jurisdiction. It cannot be the subject
of substantial subtraction for our Constitution 7 vests the entirety of judicial power in one Supreme Court and in
such lower courts as may be established by law. To be sure, the important part of a litigation, whether civil or
criminal, is the process of execution of decisions where supervening events may change the circumstance of the
parties and compel courts to intervene and adjust the rights of the litigants to prevent unfairness. It is because of
these unforseen, supervening contingencies that courts have been conceded the inherent and necessary power of
control of its processes and orders to make them conformable to law and justice. 8 For this purpose, Section 6 of
Rule 135 provides that "when by law jurisdiction is conferred on a court or judicial officer, all auxiliary writs,
processes and other means necessary to carry it into effect may be employed by such court or officer and if the
procedure to be followed in the exercise of such jurisdiction is not specifically pointed out by law or by these
rules, any suitable process or mode of proceeding may be adopted which appears conformable to the spirit of
said law or rules." It bears repeating that what the Court restrained temporarily is the execution of its own
Decision to give it reasonable time to check its fairness in light of supervening events in Congress as alleged by
petitioner. The Court, contrary to popular misimpression, did not restrain the effectivity of a law enacted by
Congress.1wphi1.nt
The more disquieting dimension of the submission of the public respondents that this Court has no jurisdiction
to restrain the execution of petitioner is that it can diminish the independence of the judiciary. Since the implant
of republicanism in our soil, our courts have been conceded the jurisdiction to enforce their final decisions. In
accord with this unquestioned jurisdiction, this Court promulgated rules concerning pleading, practice and
procedure which, among others, spelled out the rules on execution of judgments. These rules are all predicated
on the assumption that courts have the inherent, necessary and incidental power to control and supervise the
process of execution of their decisions. Rule 39 governs execution, satisfaction and effects of judgments in civil
cases. Rule 120 governs judgments in criminal cases. It should be stressed that the power to promulgate rules of
pleading, practice and procedure was granted by our Constitutions to this Court to enhance its independence, for
in the words of Justice Isagani Cruz "without independence and integrity, courts will lose that popular trust so
essential to the maintenance of their vigor as champions of justice." 9 Hence, our Constitutions continuously
vested this power to this Court for it enhances its independence. Under the 1935 Constitution, the power of this
Court to promulgate rules concerning pleading, practice and procedure was granted but it appeared to be coexistent with legislative power for it was subject to the power of Congress to repeal, alter or supplement. Thus,
its Section 13, Article VIII provides:
Sec.13. The Supreme Court shall have the power to promulgate rules concerning pleading,
practice and procedure in all courts, and the admission to the practice of law. Said rules shall be

uniform for all courts of the same grade and shall not diminish, increase, or modify substantive
rights. The existing laws on pleading, practice and procedure are hereby repealed as statutes, and
are declared Rules of Court, subject to the power of the Supreme Court to alter and modify the
same. The Congress have the power to repeal, alter or supplement the rules concerning pleading,
practice and procedure, and the admission to the practice of law in the Philippines.
The said power of Congress, however, is not as absolute as it may appear on its surface. In In re
Cunanan 10Congress in the exercise of its power to amend rules of the Supreme Court regarding admission to
the practice of law, enacted the Bar Flunkers Act of 1953 11 which considered as a passing grade, the average of
70% in the bar examinations after July 4, 1946 up to August 1951 and 71% in the 1952 bar examinations. This
Court struck down the law as unconstitutional. In his ponencia, Mr. Justice Diokno held that " . . . the disputed
law is not a legislation; it is a judgment a judgment promulgated by this Court during the aforecited years
affecting the bar candidates concerned; and although this Court certainly can revoke these judgments even now,
for justifiable reasons, it is no less certain that only this Court, and not the legislative nor executive department,
that may do so. Any attempt on the part of these department would be a clear usurpation of its function, as is the
case with the law in question." 12 The venerable jurist further ruled: "It is obvious, therefore, that the ultimate
power to grant license for the practice of law belongs exclusively to this Court, and the law passed by Congress
on the matter is of permissive character, or as other authorities say, merely to fix the minimum conditions for
the license." By its ruling, this Court qualified the absolutist tone of the power of Congress to "repeal, alter or
supplement the rules concerning pleading, practice and procedure, and the admission to the practice of law in
the Philippines.
The ruling of this Court in In re Cunanan was not changed by the 1973 Constitution. For the 1973 Constitution
reiterated the power of this Court "to promulgate rules concerning pleading, practice and procedure in all courts,
. . . which, however, may be repealed, altered or supplemented by the Batasang Pambansa . . . ." More
completely, Section 5(2)5 of its Article X provided:
xxx xxx xxx
Sec.5. The Supreme Court shall have the following powers.
xxx xxx xxx
(5) Promulgate rules concerning pleading, practice, and procedure
in all courts, the admission to the practice of law, and the
integration of the Bar, which, however, may be repealed, altered,
or supplemented by the Batasang Pambansa. Such rules shall
provide a simplified and inexpensive procedure for the speedy
disposition of cases, shall be uniform for all courts of the same
grade, and shall not diminish, increase, or modify substantive
rights.
Well worth noting is that the 1973 Constitution further strengthened the independence of the judiciary by giving
to it the additional power to promulgate rules governing the integration of the Bar. 13
The 1987 Constitution molded an even stronger and more independent judiciary. Among others, it enhanced the
rule making power of this Court. Its Section 5(5), Article VIII provides:
xxx xxx xxx
Sec. 5. The Supreme Court shall have the following powers:

xxx xxx xxx

(5) Promulgate rules concerning the protection and enforcement of
constitutional rights, pleading, practice and procedure in all courts,
the admission to the practice of law, the Integrated Bar, and legal
assistance to the underprivileged. Such rules shall provide a
simplified and inexpensive procedure for the speedy disposition of
cases, shall be uniform for all courts of the same grade, and shall
not diminish, increase, or modify substantive rights. Rules of
procedure of special courts and quasi-judicial bodies shall remain
effective unless disapproved by the Supreme Court.
The rule making power of this Court was expanded. This Court for the first time was given the power to
promulgate rules concerning the protection and enforcement of constitutional rights. The Court was also granted
for the first time the power to disapprove rules of procedure of special courts and quasi-judicial bodies. But
most importantly, the 1987 Constitution took away the power of Congress to repeal, alter, or supplement rules
concerning pleading, practice and procedure. In fine, the power to promulgate rules of pleading, practice and
procedure is no longer shared by this Court with Congress, more so with the Executive. If the manifest intent of
the 1987 Constitution is to strengthen the independence of the judiciary, it is inutile to urge, as public
respondents do, that this Court has no jurisdiction to control the process of execution of its decisions, a power
conceded to it and which it has exercised since time immemorial.
To be sure, it is too late in the day for public respondents to assail the jurisdiction of this Court to control and
supervise the implementation of its decision in the case at bar. As aforestated, our Decision became final and
executory on November 6, 1998. The records reveal that after November 6, 1998, or on December 8, 1998, no
less than the Secretary of Justice recognized the jurisdiction of this Court by filing a Manifestation and Urgent
Motion to compel the trial judge, the Honorable Thelma A. Ponferrada, RTC, Br. 104, Quezon City to provide
him ". . . a certified true copy of the Warrant of Execution dated November 17, 1998 bearing the designated
execution day of death convict Leo Echegaray and allow (him) to reveal or announce the contents thereof,
particularly the execution date fixed by such trial court to the public when requested." The relevant portions of
the Manifestation and Urgent Motion filed by the Secretary of Justice beseeching this Court "to provide the
appropriate relief" state:
xxx xxx xxx
5. Instead of filing a comment on Judge Ponferrada's Manifestation however,
herein respondent is submitting the instant Manifestation and Motion (a) to
stress, inter alia, that the non-disclosure of the date of execution deprives herein
respondent of vital information necessary for the exercise of his statutory powers,
as well as renders nugatory the constitutional guarantee that recognizes the
people's right to information of public concern, and (b) to ask this Honorable
Court to provide the appropriate relief.
6. The non-disclosure of the date of execution deprives herein respondent of vital
information necessary for the exercise of his power of supervision and control
over the Bureau of Corrections pursuant to Section 39, Chapter 8, Book IV of the
Administrative Code of 1987, in relation to Title III, Book IV of such
Administrative Code, insofar as the enforcement of Republic Act No. 8177 and
the Amended Rules and Regulations to Implement Republic Act No. 8177 is
concerned and for the discharge of the mandate of seeing to it that laws and rules
relative to the execution of sentence are faithfully observed.

7. On the other hand, the willful omission to reveal the information about the
precise day of execution limits the exercise by the President of executive
clemency powers pursuant to Section 19, Article VII (Executive Department) of
the 1987 Philippine Constitution and Article 81 of the Revised Penal Code, as
amended, which provides that the death sentence shall be carried out "without
prejudice to the exercise by the President of his executive powers at all times."
(Emphasis supplied) For instance, the President cannot grant reprieve, i.e.,
postpone the execution of a sentence to a day certain (People v. Vera, 65 Phil. 56,
110 [1937]) in the absence of a precise date to reckon with. The exercise of such
clemency power, at this time, might even work to the prejudice of the convict and
defeat the purpose of the Constitution and the applicable statute as when the date
at execution set by the President would be earlier than that designated by the
court.
8. Moreover, the deliberate non-disclosure of information about the date of
execution to herein respondent and the public violates Section 7, Article III (Bill
of Rights) and Section 28, Article II (Declaration of Principles and State Policies)
of the 1987 Philippine Constitution which read:
Sec. 7. The right of the people to information on matters of public concern shall
be recognized. Access to official records, and to documents and papers pertaining
to official acts, transactions, or decisions, as well as to government research data
used as basis for policy development shall, be afforded the citizen, subject to such
limitations as may be provided by law.
Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and
implements a policy of full public disclosure of all transactions involving public
interest.
9. The "right to information" provision is self-executing. It supplies "the rules by
means of which the right to information may be enjoyed (Cooley, A Treatise on
the Constitutional Limitations, 167 [1972]) by guaranteeing the right and
mandating the duty to afford access to sources of information. Hence, the
fundamental right therein recognized may be asserted by the people upon the
ratification of the Constitution without need for any ancillary act of the
Legislature (Id., at p. 165) What may be provided for by the Legislature are
reasonable conditions and limitations upon the access to be afforded which must,
of necessity, be consistent with the declared State policy of full public disclosure
of all transactions involving public interest (Constitution, Art. II, Sec. 28).
However, it cannot be overemphasized that whatever limitation may be prescribed
by the Legislature, the right and the duty under Art. III, Sec. 7 have become
operative and enforceable by virtue of the adoption of the New Charter."
(Decision of the Supreme Court En Banc in Legaspi v. Civil Service Commission,
150 SCRA 530, 534-535 [1987].
The same motion to compel Judge Ponferrada to reveal the date of execution of petitioner Echegaray was filed
by his counsel, Atty. Theodore Te, on December 7, 1998. He invoked his client's right to due process and the
public's right to information. The Solicitor General, as counsel for public respondents, did not oppose
petitioner's motion on the ground that this Court has no more jurisdiction over the process of execution of
Echegaray. This Court granted the relief prayed for by the Secretary of Justice and by the counsel of the
petitioner in its Resolution of December 15, 1998. There was not a whimper of protest from the public

respondents and they are now estopped from contending that this Court has lost its jurisdiction to grant said
relief. The jurisdiction of this Court does not depend on the convenience of litigants.
II
Second. We likewise reject the public respondents' contention that the "decision in this case having become
final and executory, its execution enters the exclusive ambit of authority of the executive department . . .. By
granting the TRO, the Honorable Court has in effect granted reprieve which is an executive function." 14 Public
respondents cite as their authority for this proposition, Section 19, Article VII of the Constitution which reads:
Except in cases of impeachment, or as otherwise provided in this Constitution, the President may
grant reprieves, commutations, and pardons, and remit fines and forfeitures after conviction by
final judgment. He shall also have the power to grant amnesty with the concurrence of a majority
of all the members of the Congress.
The text and tone of this provision will not yield to the interpretation suggested by the public respondents. The
provision is simply the source of power of the President to grant reprieves, commutations, and pardons and
remit fines and forfeitures after conviction by final judgment. It also provides the authority for the President to
grant amnesty with the concurrence of a majority of all the members of the Congress. The provision, however,
cannot be interpreted as denying the power of courts to control the enforcement of their decisions after their
finality. In truth, an accused who has been convicted by final judgment still possesses collateral rights and these
rights can be claimed in the appropriate courts. For instance, a death convict who become insane after his final
conviction cannot be executed while in a state of insanity. 15 As observed by Antieau, "today, it is generally
assumed that due process of law will prevent the government from executing the death sentence upon a person
who is insane at the time of execution." 16 The suspension of such a death sentence is undisputably an exercise
of judicial power. It is not a usurpation of the presidential power of reprieve though its effects is the same the
temporary suspension of the execution of the death convict. In the same vein, it cannot be denied that Congress
can at any time amend R.A. No. 7659 by reducing the penalty of death to life imprisonment. The effect of such
an amendment is like that of commutation of sentence. But by no stretch of the imagination can the exercise by
Congress of its plenary power to amend laws be considered as a violation of the power of the President to
commute final sentences of conviction. The powers of the Executive, the Legislative and the Judiciary to save
the life of a death convict do not exclude each other for the simple reason that there is no higher right than the
right to life. Indeed, in various States in the United States, laws have even been enacted expressly granting
courts the power to suspend execution of convicts and their constitutionality has been upheld over arguments
that they infringe upon the power of the President to grant reprieves. For the public respondents therefore to
contend that only the Executive can protect the right to life of an accused after his final conviction is to violate
the principle of co-equal and coordinate powers of the three branches of our government.
III
Third. The Court's resolution temporarily restraining the execution of petitioner must be put in its proper
perspective as it has been grievously distorted especially by those who make a living by vilifying courts.
Petitioner filed his Very Urgent Motion for Issuance of TRO on December 28, 1998 at about 11:30 p.m. He
invoked several grounds, viz: (1) that his execution has been set on January 4, the first working day of 1999; (b)
that members of Congress had either sought for his executive clemency and/or review or repeal of the law
authorizing capital punishment; (b.1) that Senator Aquilino Pimentel's resolution asking that clemency be
granted to the petitioner and that capital punishment be reviewed has been concurred by thirteen (13) other
senators; (b.2) Senate President Marcelo Fernan and Senator Miriam S. Defensor have publicly declared they
would seek a review of the death penalty law; (b.3) Senator Paul Roco has also sought the repeal of capital
punishment, and (b.4) Congressman Salacrib Baterina, Jr., and thirty five (35) other congressmen are
demanding review of the same law.

When the Very Urgent Motion was filed, the Court was already in its traditional recess and would only resume
session on January 18, 1999. Even then, Chief Justice Hilario Davide, Jr. called the Court to a Special Session
on January 4, 1991 17 at 10. a.m. to deliberate on petitioner's Very Urgent Motion. The Court hardly had five (5)
hours to resolve petitioner's motion as he was due to be executed at 3 p.m. Thus, the Court had the difficult
problem of resolving whether petitioner's allegations about the moves in Congress to repeal or amend the Death
Penalty Law are mere speculations or not. To the Court's majority, there were good reasons why the Court
should not immediately dismiss petitioner's allegations as mere speculations and surmises. They noted that
petitioner's allegations were made in a pleading under oath and were widely publicized in the print and
broadcast media. It was also of judicial notice that the 11th Congress is a new Congress and has no less than one
hundred thirty (130) new members whose views on capital punishment are still unexpressed. The present
Congress is therefore different from the Congress that enacted the Death Penalty Law (R.A. No. 7659) and the
Lethal Injection Law (R.A. No. 8177). In contrast, the Court's minority felt that petitioner's allegations lacked
clear factual bases. There was hardly a time to verify petitioner's allegations as his execution was set at 3 p.m.
And verification from Congress was impossible as Congress was not in session. Given these constraints, the
Court's majority did not rush to judgment but took an extremely cautious stance by temporarily restraining the
execution of petitioner. The suspension was temporary "until June 15, 1999, coeval with the constitutional
duration of the present regular session of Congress, unless it sooner becomes certain that no repeal or
modification of the law is going to be made." The extreme caution taken by the Court was compelled, among
others, by the fear that any error of the Court in not stopping the execution of the petitioner will preclude any
further relief for all rights stop at the graveyard. As life was at, stake, the Court refused to constitutionalize
haste and the hysteria of some partisans. The Court's majority felt it needed the certainty that the legislature will
not petitioner as alleged by his counsel. It was believed that law and equitable considerations demand no less
before allowing the State to take the life of one its citizens.
The temporary restraining order of this Court has produced its desired result, i.e., the crystallization of the issue
whether Congress is disposed to review capital punishment. The public respondents, thru the Solicitor General,
cite posterior events that negate beyond doubt the possibility that Congress will repeal or amend the death
penalty law. He names these supervening events as follows:
xxx xxx xxx
a. The public pronouncement of President Estrada that he will veto any law imposing the death
penalty involving heinous crimes.
b. The resolution of Congressman Golez, et al., that they are against the repeal of the law;
c. The fact that Senator Roco's resolution to repeal the law only bears his signature and that of
Senator Pimentel. 18
In their Supplemental Motion to Urgent Motion for Reconsideration, the Solicitor General cited House
Resolution No. 629 introduced by Congressman Golez entitled "Resolution expressing the sense of the House
of Representatives to reject any move to review R.A. No. 7659 which provided for the reimposition of death
penalty, notifying the Senate, the Judiciary and the Executive Department of the position of the House of
Representative on this matter and urging the President to exhaust all means under the law to immediately
implement the death penalty law." The Golez resolution was signed by 113 congressman as of January 11,
1999. In a marathon session yesterday that extended up 3 o'clock in the morning, the House of Representative
with minor, the House of Representative with minor amendments formally adopted the Golez resolution by an
overwhelming vote. House Resolution No. 25 expressed the sentiment that the House ". . . does not desire at
this time to review Republic Act 7659." In addition, the President has stated that he will not request Congress to
ratify the Second Protocol in review of the prevalence of heinous crimes in the country. In light of these
developments, the Court's TRO should now be lifted as it has served its legal and humanitarian purpose.
A last note. In 1922, the famous Clarence Darrow predicted that ". . . the question of capital punishment had
been the subject of endless discussion and will probably never be settled so long as men believe in

punishment." 19 In our clime and time when heinous crimes continue to be unchecked, the debate on the legal
and moral predicates of capital punishment has been regrettably blurred by emotionalism because of the
unfaltering faith of the pro and anti-death partisans on the right and righteousness of their postulates. To be sure,
any debate, even if it is no more than an exchange of epithets is healthy in a democracy. But when the debate
deteriorates to discord due to the overuse of words that wound, when anger threatens to turn the majority rule to
tyranny, it is the especial duty of this Court to assure that the guarantees of the Bill of Rights to the minority
fully hold. As Justice Brennan reminds us ". . . it is the very purpose of the Constitution and particularly the
Bill of Rights to declare certain values transcendent, beyond the reach of temporary political
majorities."20 Man has yet to invent a better hatchery of justice than the courts. It is a hatchery where justice
will bloom only when we can prevent the roots of reason to be blown away by the winds of rage. The flame of
the rule of law cannot be ignited by rage, especially the rage of the mob which is the mother of unfairness. The
business of courts in rendering justice is to be fair and they can pass their litmus test only when they can be fair
to him who is momentarily the most hated by society. 21
IN VIEW WHEREOF, the Court grants the public respondents' Urgent Motion for Reconsideration and
Supplemental Motion to Urgent Motion for Reconsideration and lifts the Temporary Restraining Order issued in
its Resolution of January 4, 1999.
The Court also orders respondent trial court judge (Hon. Thelma A. Ponferrada, Regional Trial Court, Quezon
City, Branch 104) to set anew the date for execution of the convict/petitioner in accordance with applicable
provisions of law and the Rules of Court, without further delay.
SO ORDERED.

Separate Opinions

VITUG, J., separate opinion;

Let me state at the outset that I have humbly maintained that Republic Act No. 7659, insofar as it prescribes the
death penalty, falls short of the strict norm set forth by the Constitution. I and some of my brethren on the
Court, who hold similarly, have consistently expressed this stand in the affirmance by the Court of death
sentences imposed by Regional Trial Courts.
In its resolution of 04 January 1999, the Court resolved to issue in the above-numbered petition a temporary
restraining order ("TRO") because, among other things, of what had been stated to be indications that Congress
would re-examine the death penalty law. It was principally out of respect and comity to a co-equal branch of the
government, i.e., to reasonably allow it that opportunity if truly minded, that motivated the Court to grant, after
deliberation, a limited time for the purpose.
The Court, it must be stressed, did not, by issuing the TRO, thereby reconsider its judgment convicting the
accused or recall the imposition of the death penalty.
The doctrine has almost invariably been that after a decision becomes final and executory, nothing else is
further done except to see to its compliance since for the Court to adopt otherwise would be to put no end to
litigations The rule notwithstanding, the Court retains control over the case until the full satisfaction of the final
judgment conformably with established legal processes. Hence, the Court has taken cognizance of the petition
assailing before it the use of lethal injection by the State to carry out the death sentence. In any event,
jurisprudence teaches that the rule of immutability of final and executory judgments admits of settled

exceptions. Concededly, the Court may, for instance, suspend the execution of a final judgment when it
becomes imperative in the higher interest of justice or when supervening events warrant it. 1 Certainly, this
extraordinary relief cannot be denied any man, whatever might be his station, whose right to life is the issue at
stake. The pronouncement in Director of Prisons vs. Judge of First Instance of Cavite, 2 should be instructive.
Thus
This Supreme Court has repeatedly declared in various decisions, which constitute jurisprudence
on the subject, that in criminal cases, after the sentence has been pronounced and the period for
reopening the same has elapsed, the court can not change or after its judgment, as its jurisdiction
has terminated, functus est officio suo, according to the classical phrase. When in cases of appeal
or review the cause has been returned thereto for execution, in the event that the judgment has
been affirmed, it performs a ministerial duty in issuing the proper order. But it does not follow
from this cessation of functions on the part of the court with reference to the ending of the cause
that the judicial authority terminates by having then passed completely to the executive. The
particulars of the execution itself, which are certainly not always included in the judgment and
writ of execution, in any event are absolutely under the control of the judicial authority, while the
executive has no power over the person of the convict except to provide for carrying out the
penalty and to pardon.
Getting down to the solution of the question in the case at bar, which is that of execution of a
capital sentence, it must be accepted as a hypothesis that postponement of the date can be
requested. There can be no dispute on this point. It is a well-known principle that,
notwithstanding the order of execution and the executory nature thereof on the date set or at the
proper time, the date therefor can be postponed, even in sentences of death. Under the common
law this postponement can be ordered in three ways: (1) By command of the King; (2) by
discretion (arbitrio) of the court; and (3) by mandate of the law. It is sufficient to state this
principle of the common law to render impossible the assertion in absolute terms that after the
convict has once been placed in jail the trial court can not reopen the case to investigate the facts
that show the need for postponement. If one of the ways is by direction of the court, it is
acknowledged that even after the date of the execution has been fixed, and notwithstanding the
general rule that after the Court of First Instance has performed its ministerial duty of ordering
the execution, functus est officio suo, and its part is ended, if however a circumstance arises that
ought to delay the execution, there is an imperative duty to investigate the emergency and to
order a postponement . . ..
In fine, the authority of the Court to see to the proper execution of its final judgment, the power of the President
to grant pardon, commutation or reprieve, and the prerogative of Congress to repeal or modify the law that
could benefit the convicted accused are not essentially preclusive of one another nor constitutionally
incompatible and may each be exercised within their respective spheres and confines. Thus, the stay of
execution issued by the Court would not prevent either the President from exercising his pardoning power or
Congress from enacting a measure that may be advantageous to the adjudged offender.
The TRO of this Court has provided that it shall be lifted even before its expiry date of 15 June 1999, "coeval
with the duration of the present regular session of Congress," if it "sooner becomes certain that no repeal or
modification of the law is going to be made." The "Urgent Motion for Reconsideration" filed by the Office of
the Solicitor General states that as of the moment, "certain circumstances/supervening events (have) transpired
to the effect that the repeal or modification of the law imposing death penalty has become nil . . .." If, indeed, it
would be futile to yet expect any chance for a timely 3 re-examination by Congress of the death penalty law,
then I can appreciate why the majority of the Justices on the Court feel rightly bound even now to lift the TRO.
I am hopeful, nevertheless, that Congress will in time find its way clear to undertaking a most thorough and
dispassionate re-examination of the law not so much for its questioned wisdom as for the need to have a second

look at the conditions sine qua non prescribed by the Constitution in the imposition of the death penalty.
In People vs. Masalihit, 4 in urging, with all due respect, Congress to consider a prompt re-examination of the
death penalty law, I have said:
The determination of when to prescribe the death penalty lies, in the initial instance, with the
law-making authority, the Congress of the Philippines, subject to the conditions that the
Constitution itself has set forth; viz: (1) That there must be compelling reasons to justify the
imposition of the death penalty; and (2) That the capital offense must involve a heinous crime. It
appears that the fundamental law did not contemplate a simple 'reimposition' of the death penalty
to offenses theretofore already provided in the Revised Penal Code or, let alone, just because of
it. The term 'compelling reasons' would indicate to me that there must first be a marked change
in the milieu from that which has prevailed at the time of adoption of the 1987 Constitution, on
the one hand, to that which exists at the enactment of the statute prescribing the death penalty,
upon the other hand, that would make it distinctively inexorable to allow the re-imposition of the
death penalty. Most importantly, the circumstances that would characterize the 'heinous nature'
of the crime and make it so exceptionally offensive as to warrant the death penalty must be
spelled out with great clarity in the law, albeit without necessarily precluding the Court from
exercising its power of judicial review given the circumstances of each case. To venture, in the
case of murder, the crime would become 'heinous' within the Constitutional concept, when, to
exemplify, the victim is unnecessarily subjected to a painful and excruciating death or, in the
crime of rape, when the offended party is callously humiliated or even brutally killed by the
accused. The indiscriminate imposition of the death penalty could somehow constrain courts to
apply, perhaps without consciously meaning to, stringent standards for conviction, not too
unlikely beyond what might normally be required in criminal cases, that can, in fact, result in
undue exculpation of offenders to the great prejudice of victims and society.
Today, I reiterate the above view and until the exacting standards of the Constitution are clearly met as so
hereinabove expressed, I will have to disagree, most respectfully, with my colleagues in the majority who
continue to hold the presently structured Republic Act No. 7659 to be in accord with the Constitution, an issue
that is fundamental, constant and inextricably linked to the imposition each time of the death penalty and, like
the instant petition, to the legal incidents pertinent thereto.
Accordingly, I vote against the lifting of the restraining order of the Court even as I, like everyone else,
however, must respect and be held bound by the ruling of the majority.

PANGANIBAN, J., separate opinion;

I agree with the Court's Resolution that, without doubt, this Court has jurisdiction to issue the disputed
Temporary Restraining Order (TRO) on January 4, 1999. I will not repeat its well-reasoned disquisition. I write
only to explain my vote in the context of the larger issue of the death penalty.
Since the solicitor general has demonstrated that Congress will not repeal or amend RA 7659 during its current
session which ends on June 15, 1999 and that, in any event, the President will veto any such repeal or
amendment, the TRO should by its own terms be deemed lifted now. However, my objections to the imposition
of the death penalty transcend the TRO and permeate its juridical essence.
I maintain my view that RA 7659 (the Death Penalty Law) is unconstitutional insofar as some parts thereof
prescribing the capital penalty fail to comply with the requirements of "heinousness" and "compelling reasons"
prescribed by the Constitution of the Philippines. * This I have repeatedly stated in my Dissenting Opinion in

various death cases decided by the Court, as well as during the Court's deliberation on this matter on January 4,
1999. For easy reference, I hereby attach a copy of my Dissent promulgated on February 7, 1997.
Consequently, I cannot now vote to lift TRO, because to do so would mean the upholding and enforcement of
law (or the relevant portions thereof) which, I submit with all due respect, is unconstitutional and therefore
legally nonexistent. I also reiterate that, in my humble opinion, RA 8177 (the Lethal Injection Law) is likewise
unconstitutional since it merely prescribes the manner in which RA 7659 ( the Death Penalty Law) is to
implemented.
Having said that, I stress, however, that I defer to the rule of law and will abide by the ruling of the Court that
both RA 7659 and RA 8177 are constitutional and that death penalty should, by majority vote, be implemented
by means of lethal injection.
FOR THE ABOVE REASONS, I vote to deny the solicitor general's Motion for Reconsideration.
G.R. No. 117472 February 7, 1997
PEOPLE OF THE PHILIPPINES vs. LEO ECHEGARAY y PILO.
Supplemental Motion for Reconsideration
SEPARATE OPINION
Death Penalty Law Unconstitutional
In his Supplemental Motion for Reconsideration 1 dated August 22, 1996 filed by his newly-retained
counsel, 2 the accused raises for the first time a very crucial ground for his defense: that Republic Act. No.
7659, the law reimposing the death penalty, is unconstitutional. In the Brief and (original Motion for
Reconsideration filed by his previous counsel, 3 this transcendental issue was nor brought up. Hence, it was not
passed upon by this Court in its Decision affirming the trial court's sentence of death. 4
The Constitution Abolished Death Penalty
Sec. 19, Article III of the 1987 Constitution provides:
Sec. 19. (1) Excessive fines shall not be imposed, nor cruel, degrading or inhuman punishment
inflicted. Neither shall death penalty be imposed, unless for compelling
reasons involving heinouscrimes, the Congress hereafter provides for it. Any death
penalty already imposed shall be reduced to reclusion perpetua. (Emphasis supplied)
The second and third sentences of the above provision are new and had not been written in the 1935, 1973 or
even in the 1986 "Freedom Constitution." They proscribe the imposition 5 of the death penalty "unless for
compelling reasons involving heinous crimes, Congress provides for it," and reduced "any death penalty already
imposed" to reclusion perpetua. The provision has both a prospective aspect (it bars the future imposition of the
penalty) and a retroactive one (it reduces imposed capital sentences to the lesser penalty of imprisonment).
This two-fold aspect is significant. It stresses that the Constitution did not merely suspend the imposition of the
death penalty, but in fact completely abolished it from the statute books. The automatic commutation or
reduction to reclusion perpetua of any death penalty extant as of the effectivity of the Constitution clearly
recognizes that, while the conviction of an accused for a capital crime remains, death as a penalty ceased to
exist in our penal laws and thus may longer be carried out. This is the clear intent of the framers of our

Constitution. As Comm. Bernas ex-claimed, 6 "(t)he majority voted for the constitutional abolition of the death
penalty."
Citing this and other similar pronouncements of the distinguished Concom delegate, Mme. Justice Ameurfina
Melencio-Herrera emphasized, 7 "It is thus clear that when Fr. Bernas sponsored the provision regarding the
non-imposition of the death penalty, what he had in mind was the total abolition and removal from the statute
books of the death penalty. This became the intent of the frames of the Constitution when they approved the
provision and made it a part of the Bill of Rights." With such abolition as a premise, restoration thereof
becomes an exception to a constitutional mandate. Being an exception and thus in derogation of the
Constitution, it must then be strictly construed against the State and liberally in favor of the people. 8 In this
light, RA 7659 enjoys no presumption of constitutionality.
The Constitution Strictly Limits
Congressional Prerogative to Prescribe Death
To me, it is very clear that the Constitution (1) effectively removed the death penalty from the then existing
statutes but (2) authorized Congress to restore it at some future time to enable or empower courts to reimpose it
on condition that it (Congress) 9 finds "compelling reasons, involving heinous crimes." The language of the
Constitution is emphatic (even if "awkward" 10): the authority of Congress to "provide for it" is not absolute.
Rather, it is strictly limited:
1. by "compelling reasons" that may arise after the Constitution became effective; and
2. to crimes which Congress should identify or define or characterize as "heinous."
The Constitution inexorably placed upon Congress the burden of determining the existence of "compelling
reasons" and of defining what crimes are "heinous" before it could exercise its law-making prerogative to
restore the death penalty. For clarity's sake, may I emphasize that Congress, by law; prescribes the death
penalty on certain crimes; and courts, by their decisions, impose it on individual offenders found guilty beyond
reasonable doubt of committing said crimes.
In the exercise of this fundamental mandate, Congress enacted RA 7659 11 to "provide for it" (the death penalty)
(1) by amending certain provisions of the Revised Penal Code; 12 (2) by incorporating a new article
therein; 13 and (3) by amending certain special laws. 14
But RA 7659 did not change the nature or the elements of the crimes stated in the Penal Code and in the special
laws. It merely made the penalty more severe. Neither did its provisions (other than the preamble, which was
cast in general terms) discuss or justify the reasons for the more sever sanction, either collectively for all the
offenses or individually for each of them.
Generally, it merely reinstated the concept of and the method by which the death penalty had been imposed
until February 2, 1987, when the Constitution took effect as follows: (1) a person is convicted of a capital
offense; and (2) the commission of which was accompanied by aggravating circumstances not outweighed by
mitigating circumstances.
The basic question then is: In enacting RA 7659, did Congress exceed the limited authority granted it by the
Constitution? More legally put: It reviving the death penalty, did Congress act with grave abuse of discretion or
in excess of the very limited power or jurisdiction conferred on it by Art. III, Sec. 19? The answer, I respectfully
submit, is YES.
Heinous Crimes

To repeal, while he Constitution limited the power of Congress to prescribe the death penalty ONLY to
"heinous" crimes, it did not define or characterize the meaning of "heinous". Neither did Congress. As already
stated, RA 7659 itself merely selected some existing crimes for which it prescribed death as an applicable
penalty. It did not give a standard or a characterization by which courts may be able to appreciate the
heinousness of a crime. I concede that Congress was only too well aware of its constitutionally limited power.
In deference thereto, it included a paragraph in the preambular or "whereas" clauses of RA 7659, as follows:
WHEREAS, the crimes punishable by death under this Act are heinous for being grievous,
odious and hateful offenses and which, by reason of their inherent or manifest wickedness,
viciousness, atrocity and perversity are repugnant and outrageous to the common standards and
norms of decency and morality in a just, civilized and ordered society.
In my humble view, however, the foregoing clause is clearly an insufficient definition or characterization of
what a heinous crime is. It simply and gratuitously declared certain crimes to be "heinous" without adequately
justifying its bases therefor. It supplies no useful, workable, clear and unambiguous standard by which the
presence of heinousness can be determined. Calling the crimes "grievous, odious and hateful" is not a substitute
for an objective juridical definition. Neither is the description "inherent or manifest wickedness, viciousness,
atrocity and perversity." Describing blood as blue does not detract from its being crimson in fact; and renaming
gumamela as rose will not arm it with thorns.
Besides, a preamble is really not an integral part of a law. It is merely an introduction to show its intent or
purposes. It cannot be the origin of rights and obligations. Where the meaning of a statute is clear and
unambiguous, the preamble can neither expand nor restrict its operation, much less prevail over its text. 15 In
this case, it cannot be the authoritative source to show compliance with the Constitution.
As already alluded to, RA 7659 merely amended certain laws to prescribe death as the maximum imposable
penalty once the court appreciates the presence or absence of aggravating circumstances. 16
In other words, it just reinstated capital punishment for crimes which were already punishable with death prior
to the effectivity of the 1987 Constitution. With the possible exception of plunder and qualified bribery, 17 no
new crimes were introduced by RA 7659. The offenses punished by death under said law were already to
punishable by the Revised Penal Code 18 and by special laws.
During the debate on Senate Bill No. 891 which later became RA 7659, Sen. Jose Lina, in answer to a question
of Sen. Ernesto Maceda, wryly said: 19
So we did not go that far from the Revised Penal Code, Mr. President, and from existing special
laws which, before abolition of the death penalty, had already death as the maximum penalty.
By merely reimposing capital punishment on the very same crimes which were already penalized with death
prior to the charter's effectivity, Congress I submit has not fulfilled its specific and positive constitutional duty.
If the Constitutional Commission intended merely to allow Congress to prescribe death for these very same
crimes, it would not have written Sec. 19 of Article III into the fundamental law. But the stubborn fact is it did.
Verily, the intention to 1) delete the death penalty from our criminal laws and 2) make its restoration possible
only under and subject to stringent conditions is evident not only from the language of the Constitution but also
from the charter debates on this matter.
The critical phrase "unless for compelling reasons involving heinous crimes" was an amendment introduced by
Comm. Christian Monsod. In explaining what possible crimes could qualify as heinous, he and Comm. Jose
Suarez agreed on "organized murder" or "brutal murder of a rape victim". 20 Note that the honorable
commissioners did not just say "murder" but organized murder; not just rape but brutal murder of a rape victim.
While the debates were admittedly rather scanty, I believe that the available information shows that, when

deliberating on "heinousness", the Constitutional Commission did not have in mind the offenses already
existing and already penalized with death. I also believe that the heinousness clause requires that:
1. the crimes should be entirely new offenses, the elements of which have an inherent quality,
degree or level of perversity, depravity or viciousness unheard of until then; or
2. even existing crimes, provided some new element or essential ingredient like "organized" or
"brutal" is added to show their utter perversity, odiousness or malevolence; or
3. the means or method by which the crime, whether new or old, is carried out evinces a degree or
magnitude of extreme violence, evil, cruelty, atrocity, viciousness as to demonstrate its
heinousness.21
For this purpose, Congress could enact an entirely new set of circumstances to qualify the crime as "heinous", in
the same manner that the presence of treachery in a homicide aggravates the crime to murder for which a
heavier penalty is prescribed.
Compelling Reasons
Quite apart from requiring the attendant element of heinousness, the Constitution also directs Congress to
determine "compelling reasons" for the revival of the capital penalty. It is true that paragraphs 3 and 4 of the
preamble of RA 7659 22 made some attempt at meeting this requirement. But such effort was at best feeble and
inconsequential. It should be remembered that every word or phrase in the Constitution is sacred and should
never be ignored, cavalierly-treated or brushed aside. Thus, I believe that the compelling reasons and the
characterization of heinousness cannot be done wholesale but must shown for each and every crime,
individually and separately.
The words "compelling reasons" were included in the Charter because, in the words of Comm. Monsod, "in the
future, circumstances may arise which we should not preclude today . . . and that the conditions and the
situation (during the deliberations of the Constitutional Commission) might change for very specific reasons"
requiring the return of the constitutionally-abhorred penalty.
In his sponsorship of House Bill No. 62 which later evolved into RA 7659, Congressman Pablo Garcia, in
answer to questions raised by Representative Edcel Lagman tried to explain these compelling reasons: 23
MR. LAGMAN: So what are the compelling reasons now, Mr. Speaker? . . .
MR. GARCIA (P.). The worsening peace and order condition in the country, Mr. Speaker. That
is one.
MR. LAGMAN. So the compelling reason which the distinguished sponsor would like to justify
or serve as an anchor for the justification of the reimposition of the death penalty is the alleged
worsening peace and order situation. The Gentleman claims that is one the compelling reasons.
But before we dissent this particular "compelling reason," may we know what are the other
compelling reasons, Mr. Speaker?
MR. GARCIA (P.) Justice, Mr. Speaker.
MR. LAGMAN. Justice.
MR. GARCIA (P.). Yes, Mr. Speaker.

MR. LAGMAN. Justice is a compelling reason, Mr. Speaker? Could the Gentleman kindly
elaborate on that answer? Why is justice a compelling reason as if justice was not obtained at the
time the Constitution abolished the death penalty? Any compelling reason should be a
supervening circumstances after 1987.
MR. GARCIA (P.). Mr. Speaker, I have repeatedly said again and again that if one lives in an
organized society governed by law, justice demands that crime be punished and that the penalty
imposed be commensurate with the offense committed.
MR. LAGMAN. The Gentleman would agree with me that when the Constitution speaks of the
compelling reasons to justify the reimposition of death penalty, it refers to reasons which would
supervene or come after the approval of the 1987 Constitution. Is he submitting that justice, in
his own concept of a commensurate penalty for the offense committed, was not obtained in 1987
when the Constitution abolished the death penalty and the people ratified it?
MR. GARCIA (P.). That is precisely why we are saying that now, under present conditions,
because of the seriousness of the offenses being committed at this time, justice demands that the
appropriate penalty must be meted out for those who have committed heinous crimes.
xxx xxx xxx
In short, Congressman Garcia invoked the preambular justifications of "worsening peace and order" and
"justice". With all due respect I submit that these grounds are not "compelling" enough to justify the revival of
state-decreed deaths. In fact, I dare say that these "reasons" were even non-existent. Statistics from the
Philippine National Police show that the crime volume and crime rate particularly on those legislated capital
offenses did not worsen but in fact declined between 1987, the date when the Constitution took effect, and
1993, the year when RA 7659 was enacted. Witness the following debate 24 also between Representatives
Garcia and Lagman:
MR. LAGMAN. Very good, Mr. Speaker.
Now, can we go to 1987. Could the Gentleman from Cebu inform us the volume of the crime of
murder in 1987?
MR. GARCIA (P.). The volume of the crime of murder in 1987 is 12,305.
MR. LAGMAN. So, the corresponding crime rate was 21 percent.
MR. GARCIA (P.). Yes, Mr. Speaker.
MR. LAGMAN. That was in 1987, Mr. Speaker, could the distinguished chairman inform us the
volume of murder in 1988?
MR. GARCIA (P.). It was 10,521, Mr. Speaker.
MR. LAGMAN. Or it was a reduction from 12,305 in 1987 to 10,521 in 1988. Correspondingly,
the crime rate in the very year after the abolition of the death penalty was reduced from 21
percent to 18 percent. Is that correct, Mr. Speaker?
MR. GARCIA (P.). That is correct, Mr. Speaker. Those are the statistics supplied by the PC.

MR. LAGMAN. Now can we go again to 1987 when the Constitution abolished the death
penalty? May we know from the distinguished Gentleman the volume of robbery in 1987?
MR. GARCIA (P.). Will the Gentleman state the figure? I will confirm it.
MR. LAGMAN. No, Mr. Speaker, I am asking the question.
MR. GARCIA (P.). It was 22,942, Mr. Speaker, and the crime rate was 40 percent.
MR. LAGMAN. This was the year immediately after the abolition of the death penalty. Could
the Gentleman tell us the volume of robbery cases in 1988?
MR. GARCIA (P.). It was 16,926, Mr. Speaker.
MR. LAGMAN. Obviously, the Gentleman would agree with me. Mr. Speaker that the volume of
robbery cases declined from 22,942 in 1987 or crime rate of 40 percent to 16,926 or a crime rate
of 29 percent. Would the Gentleman confirm that, Mr. Speaker?
MR. GARCIA (P.). This is what the statistics say, I understand we are reading now from the
same document.
MR. LAGMAN. Now, going to homicide, the volume 1987 was 12,870 or a crime rate of 22
percent. The volume in 1988 was 11,132 or a crime rate of 19 percent. Would the Gentleman
confirm that, Mr. Speaker?
MR. GARCIA (P.). As I Said, Mr. Speaker, we are reading from the same document and I would
not want to say that the Gentleman is misreading the document that I have here.
MR. LAGMAN. But would the Gentleman confirm that?
MR. GARCIA (P.). The document speaks for itself.
When interpellated by Sen. Arturo Tolentino, Sen. Jose Lina gave some figures on the number of persons
arrested in regard to drug-related offenses in the year 1987 as compared to 1991: 25
Let me cite this concrete statistics by the Dangerous Drug Board.
In 1987 this was the year when the death penalty was
abolished the persons arrested in drug-related cases were 3,062, and the figure dropped to
2,686 in 1988.
By the way, I will furnish my Colleagues with a photocopy of this report.
From 3,062 in 1987, it dropped to 2,686. Again, it increased a bit to 2,862 in 1989. It still
decreased to 2,202 in 1990, and it increased again to 2,862 in 1991.
But in 1987, when the death penalty was abolished, as far as the drug-related cases are
concerned, the figure continued a downward trend, and there was no death penalty in this time
from, 1988 to 1991.

In a further attempt to show compelling reasons, the proponents of the death penalty argue that its reimposition
"would pose as an effective deterrent against heinous crimes." 26 However no statistical data, no sufficient
proof, empirical or otherwise, have been submitted to show with any conclusiveness the relationship between
the prescription of the death penalty for certain offenses and the commission or non-commission thereof. This is
a theory that can be debated on and on, 27 in the same manner that another proposition that the real deterrent
to crime is the certainty of immediate arrest, prosecution and conviction of the culprit without unnecessary risk,
expense and inconvenience to the victim, his heirs or his witnesses can be argued indefinitely. 28 This debate
can last till the academics grow weary of the spoken word, but it would not lessen the constitutionally-imposed
burden of Congress to act within the "heinousness" and "compelling reasons" limits of its death-prescribing
power.
Other Constitutional Rights
Militate Against RA 7659
It should be emphasized that the constitutional ban against the death penalty is included in our Bill of Rights. As
such, it should like any other guarantee in favor of the accused be zealously protected, 29 and any
exception thereto meticulously screened. Any doubt should be resolved in favor of the people, particularly
where the right pertains to persons accused of crimes. 30 Here the issue is not just crimes but capital crimes!
So too, all our previous Constitutions, including the first one ordained at Malolos, guarantee that "(n)o person
shall be deprived of life, liberty or property without due process of law." 31 This primary right of the people to
enjoy life life at its fullest, life in dignity and honor is not only reiterated by the 1987 Charter but is in fact
fortified by its other pro-life and pro-human rights provisions. Hence, the Constitution values the dignity of
every human person and guarantees full respect for human rights, 32 expressly prohibits any form of
torture 33 which is arguably a lesser penalty than death, emphasizes the individual right to life by giving
protection to the life of the mother and the unborn from the moment of conception 34 and establishes the
people's rights to health, a balanced ecology and education. 35
This Constitutional explosion of concern for man more than property for people more than the state, and for life
more than mere existence augurs well for the strict application of the constitutional limits against the revival of
death penalty as the final and irreversible exaction of society against its perceived enemies.
Indeed, volumes have been written about individual rights to free speech. assembly and even religion. But the
most basic and most important of these rights is the right to life. Without life, the other rights cease in their
enjoyment, utility and expression.
This opinion would not be complete without a word on the wrenching fact that the death penalty militates
against the poor, the powerless and the marginalized. The "Profile of 165 Death Row Convicts" submitted by
the Free Legal Assistance Group 36 highlights this sad fact:
1. Since the reimposition of the death penalty, 186 persons 37 have been sentenced to death. At the
end of 1994, there were 24 death penalty convicts, at the end of 1995, the number rose to 90; an
average of seven (7) convicts per month; double the monthly average of capital sentences
imposed the prior year. From January to June 1996, the number of death penalty convicts
reached 72, an average of 12 convicts per month, almost double the monthly average of capital
sentences imposed in 1995.
2. Of the 165 convicts polled, approximately twenty one percent (21%) earn between P200 to
P2,900 monthly; while approximately twenty seven percent (27%) earn between P3,000 to
P3,999 monthly. Those earning above P4,000 monthly are exceedingly few: seven percent (7%)
earn between P4,000 to P4,999, four percent (4%) earn between P5,000 to P5,999, seven percent
(7%) earn between P6,000 to P6,999, those earning between P7,000 to P15,000 comprise only

3.

4.

5.

6.

four percent (4%), those earning P15,000 and above only one percent (1%). Approximately
thirteen percent (13%) earn nothing at all, while approximately two percent (2%) earn
subsistence wages with another five percent (5%) earning variable income. Approximately nine
percent (9%) do not know how much they earn in a month.
Thus, approximately two-thirds of the convicts, about 112 of them, earn below the governmentmandated minimum monthly wage of P4,290; ten (10) of these earn below the official poverty
line set by government. Twenty six (26) earn between P4,500.00 and P11,0000.00 monthly,
indicating they belong to the middle class; only one (1) earns P30.000.00 monthly. Nine (9)
convicts earn variable income or earn on a percentage or allowance basis; fifteen (15) convicts
do not know or are unsure of their monthly income. Twenty two (22) convicts earn nothing at all.
In terms of occupation, approximately twenty one percent (21%) are agricultural workers or
workers in animal husbandry; of these thirty (30), or almost one-fifth thereof, are farmers. Thirty
five percent (35%) are in the transport and construction industry, with thirty one (31)
construction workers or workers in allied fields (carpentry, painting, welding) while twenty
seven (27) are transport workers (delivery, dispatcher, mechanic, tire man, truck helper) with
sixteen (16) of them drivers. Eighteen percent (18%) are in clerical, sales and service industries,
with fourteen (14) sales workers (engaged in buy and sell or fish, cigarette or rice vendors),
twelve (12) service workers (butchers, beauticians, security guards, shoemakers, tour guides,
computer programmers, radio technicians) and four (4) clerks (janitors, MERALCO employee
and clerk) About four percent (4%) are government workers, with six (6) persons belonging to
the armed services (AFP, PNP and even CAFGU). Professionals, administrative employee and
executives comprise only three percent (3%), nine percent (9%) are unemployed.
None of the DRC's use English as their medium of communication. About forty four percent
(44%), or slightly less than half speak and understand Tagalog; twenty six percent (26%), or
about one-fourth, speak and understand Cebuano. The rest speak and understand Bicolano,
Ilocano, Ilonggo, Kapampangan, Pangasinense and Waray. One (1) convict is a foreign national
and speaks and understand Niponggo.
Approximately twelve percent (12%) graduated from college, about forty seven percent (47%)
finished varying levels of elementary education with twenty seven (27) graduating from
elementary. About thirty five percent (35%), fifty eight (58) convicts, finished varying levels of
high school, with more than half of them graduating from high school. Two (2) convicts finished
vocational education; nine (9) convicts did not study at all.

The foregoing profile based on age, language and socio-economic situations sufficiently demonstrates that RA
7659 has militated against the poor and the powerless in society those who cannot afford the legal services
necessary in capital crimes, where extensive preparation, investigation, research and presentation are required.
The best example to shoe the sad plight of the underprivileged is this very case where the crucial issue of
constitutionality was woefully omitted in the proceedings in the trial court and even before this Court until the
Free legal Assistance Group belatedly brought it up in the Supplemental Motion for Reconsideration.
To the poor and unlettered, it is bad enough that the law is complex and written in a strange, incomprehensible
language. Worse still, judicial proceedings are themselves complicated, intimidating and damning. The net
effect of having a death penalty that is imposed more often than not upon the impecunious is to engender in the
minds of the latter, a sense unfounded, to be sure, but unhealthy nevertheless of the unequal balance of
the scales of justice.
Most assuredly, it may be contended that the foregoing arguments, and in particular, the statistics above-cited,
are in a very real sense prone to be misleading, and that regardless of the socio-economic profile of the DRCs,
the law reviving capital punishment does not in any way single out or discriminate against the poor, the
unlettered or the underprivileged. To put it in another way, as far as the disadvantaged are concerned, the law
would still be complex and written in a strange and incomprehensible language, and judicial proceedings
complicated and intimidating, whether the ultimate penalty involved be life (sentence) or death. Another aspect

of the whole controversy is that, whatever the penalties set by law, it seems to me that there will always be
certain class or classes of people in our society who, by reason of their poverty, lack of educational attainment
and employment opportunities, are consequently confined to living, working and subsisting in less-than-ideal
environments, amidst less-than-genteel neighbors similarly situated as themselves, and are therefore inherently
more prone to be involved (as victims or perpetrators) in vices, violence and crime. So from that perspective,
the law reviving the death penalty neither improves nor worsens their lot substantially. Or, to be more precise,
such law may even be said to help improve their situation (at least in theory) by posing a much stronger
deterrent to the commission of heinous crimes.
However, such a viewpoint simply ignores the very basic differences that exist in the situations of the poor and
the non-poor. Precisely because the underprivileged are what they are, they require and deserve a greater degree
of protection and assistance from our laws and Constitution, and from the courts and the State, so that in spite of
themselves, they can be empowered to rise above themselves and their situation. The basic postulates for such a
position are, I think, simply that everyone ultimately wants to better himself and that we cannot better ourselves
individually to any significant degree if we are unable to advance as an entire people and nation. All the propoor provisions of the Constitution point in this direction. Yet we are faced with this law that effectively inflicts
the ultimate punishment on none other than the poor and disadvantaged in the greater majority of cases, and
which penalty, being so obviously final and so irreversibly permanent, erases all hope of reform, of change for
the better. This law, I submit, has no place in our legal, judicial and constitutional firmament.
Epilogue
In sum, I respectfully submit that:
(1) The 1987 Constitution abolished the death penalty from our statute books. It did not merely suspend or
prohibit its imposition.
(2) The Charter effectively granted a new right: the constitution right against the death penalty, which is really a
species of the right to life.
(3) Any law reviving the capital penalty must be strictly construed against the State and liberally in favor of the
accused because such a stature denigrates the Constitution, impinges on a basic right and tends to deny equal
justice to the underprivileged.
(4) Every word or phrase in the Constitution is sacred and should never be ignored, cavalierly-treated or
brushed aside.
(5) Congressional power death is severely limited by two concurrent requirements:
a. First, Congress must provide a set of attendant circumstances which the prosecution must prove
beyond reasonable doubt, apart from the elements of the crime and itself. Congress must explain
why and how these circumstances define or characterize the crime as "heinous".
b. Second, Congress has also the duty of laying out clear and specific reasons which arose after the
effectivity of the Constitution compelling the enactment of the law. It bears repeating that these
requirements are inseparable. They must both be present in view of the specific constitutional
mandate "for compelling reasons involving heinous crimes." The compelling reason must
flow from the heinous nature of the offense.
(6) In every law reviving the capital penalty, the heinousness and compelling reasons must be set out for each
and every crime, and not just for all crimes generally and collectively.

"Thou shall not kill" is fundamental commandment to all Christians, as well as to the rest of the "sovereign
Filipino people" who believe in Almighty God. 38 While the Catholic Church, to which the vast majority of our
people belong, acknowledges the power of public authorities to prescribe the death penalty, it advisedly limits
such prerogative only to "cases of extreme
gravity." 39 To quote Pope John Paul II in his encyclical Evangelium Vitae (A Hymn to Life), 40 "punishment
must be carefully evaluated and decided upon, and ought not to go to the extreme of executing the offender
except in cases of absolute necessity: in other words, when it would not be possible otherwise to defend society .
. . (which is) very rare, if not practically non-existent."
Although not absolutely banning it, both the Constitution and the Church indubitably abhor the death penalty.
Both are pro-people and pro-life. Both clearly recognize the primacy of human life over and above even the
state which man created precisely to protect, cherish and defend him. The Constitution reluctantly allows capital
punishment only for "compelling reasons involving heinous crimes" just as the Church grudgingly permits it
only reasons of "absolute necessity" involving crimes of "extreme gravity", which are very rare and practically
non-existent.
In the face of these evident truisms, I ask: Has the Congress, in enacting RA 7659, amply discharged its
constitutional burden of proving the existence of "compelling reasons" to prescribe death against well-defined
"heinous" crimes?
I respectfully submit it has not.
WHEREFORE, the premises considered, I respectfully vote to grant partially the Supplemental Motion for
Reconsideration and to modify the dispositive portion of the decision of the trial court by deleting the words
"DEATH", as provided for under RA 7659," and substitute therefore reclusion perpetua.
I further vote to declare RA 7659 unconstitutional insofar as it prescribes the penalty of death for the crimes
mentioned in its text.
Separate Opinions
VITUG, J., separate opinion;
Let me state at the outset that I have humbly maintained that Republic Act No. 7659, insofar as it prescribes the
death penalty, falls short of the strict norm set forth by the Constitution. I and some of my brethren on the
Court, who hold similarly, have consistently expressed this stand in the affirmance by the Court of death
sentences imposed by Regional Trial Courts.
In its resolution of 04 January 1999, the Court resolved to issue in the above-numbered petition a temporary
restraining order ("TRO") because, among other things, of what had been stated to be indications that Congress
would re-examine the death penalty law. It was principally out of respect and comity to a co-equal branch of the
government, i.e., to reasonably allow it that opportunity if truly minded, that motivated the Court to grant, after
deliberation, a limited time for the purpose.
The Court, it must be stressed, did not, by issuing the TRO, thereby reconsider its judgment convicting the
accused or recall the imposition of the death penalty.
The doctrine has almost invariably been that after a decision becomes final and executory, nothing else is
further done except to see to its compliance since for the Court to adopt otherwise would be to put no end to
litigations The rule notwithstanding, the Court retains control over the case until the full satisfaction of the final
judgment conformably with established legal processes. Hence, the Court has taken cognizance of the petition
assailing before it the use of lethal injection by the State to carry out the death sentence. In any event,

jurisprudence teaches that the rule of immutability of final and executory judgments admits of settled
exceptions. Concededly, the Court may, for instance, suspend the execution of a final judgment when it
becomes imperative in the higher interest of justice or when supervening events warrant it. 1 Certainly, this
extraordinary relief cannot be denied any man, whatever might be his station, whose right to life is the issue at
stake. The pronouncement in Director of Prisons vs. Judge of First Instance of Cavite, 2 should be instructive.
Thus
This Supreme Court has repeatedly declared in various decisions, which constitute jurisprudence
on the subject, that in criminal cases, after the sentence has been pronounced and the period for
reopening the same has elapsed, the court can not change or after its judgment, as its jurisdiction
has terminated, functus est officio suo, according to the classical phrase. When in cases of appeal
or review the cause has been returned thereto for execution, in the event that the judgment has
been affirmed, it performs a ministerial duty in issuing the proper order. But it does not follow
from this cessation of functions on the part of the court with reference to the ending of the cause
that the judicial authority terminates by having then passed completely to the executive. The
particulars of the execution itself, which are certainly not always included in the judgment and
writ of execution, in any event are absolutely under the control of the judicial authority, while the
executive has no power over the person of the convict except to provide for carrying out the
penalty and to pardon.
Getting down to the solution of the question in the case at bar, which is that of execution of a
capital sentence, it must be accepted as a hypothesis that postponement of the date can be
requested. There can be no dispute on this point. It is a well-known principle that,
notwithstanding the order of execution and the executory nature thereof on the date set or at the
proper time, the date therefor can be postponed, even in sentences of death. Under the common
law this postponement can be ordered in three ways: (1) By command of the King; (2) by
discretion (arbitrio) of the court; and (3) by mandate of the law. It is sufficient to state this
principle of the common law to render impossible the assertion in absolute terms that after the
convict has once been placed in jail the trial court can not reopen the case to investigate the facts
that show the need for postponement. If one of the ways is by direction of the court, it is
acknowledged that even after the date of the execution has been fixed, and notwithstanding the
general rule that after the Court of First Instance has performed its ministerial duty of ordering
the execution, functus est officio suo, and its part is ended, if however a circumstance arises that
ought to delay the execution, there is an imperative duty to investigate the emergency and to
order a postponement . . ..
In fine, the authority of the Court to see to the proper execution of its final judgment, the power of the President
to grant pardon, commutation or reprieve, and the prerogative of Congress to repeal or modify the law that
could benefit the convicted accused are not essentially preclusive of one another nor constitutionally
incompatible and may each be exercised within their respective spheres and confines. Thus, the stay of
execution issued by the Court would not prevent either the President from exercising his pardoning power or
Congress from enacting a measure that may be advantageous to the adjudged offender.
The TRO of this Court has provided that it shall be lifted even before its expiry date of 15 June 1999, "coeval
with the duration of the present regular session of Congress," if it "sooner becomes certain that no repeal or
modification of the law is going to be made." The "Urgent Motion for Reconsideration" filed by the Office of
the Solicitor General states that as of the moment, "certain circumstances/supervening events (have) transpired
to the effect that the repeal or modification of the law imposing death penalty has become nil . . .." If, indeed, it
would be futile to yet expect any chance for a timely 3 re-examination by Congress of the death penalty law,
then I can appreciate why the majority of the Justices on the Court feel rightly bound even now to lift the TRO.

I am hopeful, nevertheless, that Congress will in time find its way clear to undertaking a most thorough and
dispassionate re-examination of the law not so much for its questioned wisdom as for the need to have a second
look at the conditions sine qua non prescribed by the Constitution in the imposition of the death penalty.
In People vs. Masalihit, 4 in urging, with all due respect, Congress to consider a prompt re-examination of the
death penalty law, I have said:
The determination of when to prescribe the death penalty lies, in the initial instance, with the
law-making authority, the Congress of the Philippines, subject to the conditions that the
Constitution itself has set forth; viz: (1) That there must be compelling reasons to justify the
imposition of the death penalty; and (2) That the capital offense must involve a heinous crime. It
appears that the fundamental law did not contemplate a simple 'reimposition' of the death penalty
to offenses theretofore already provided in the Revised Penal Code or, let alone, just because of
it. The term 'compelling reasons' would indicate to me that there must first be a marked change
in the milieu from that which has prevailed at the time of adoption of the 1987 Constitution, on
the one hand, to that which exists at the enactment of the statute prescribing the death penalty,
upon the other hand, that would make it distinctively inexorable to allow the re-imposition of the
death penalty. Most importantly, the circumstances that would characterize the 'heinous nature'
of the crime and make it so exceptionally offensive as to warrant the death penalty must be
spelled out with great clarity in the law, albeit without necessarily precluding the Court from
exercising its power of judicial review given the circumstances of each case. To venture, in the
case of murder, the crime would become 'heinous' within the Constitutional concept, when, to
exemplify, the victim is unnecessarily subjected to a painful and excruciating death or, in the
crime of rape, when the offended party is callously humiliated or even brutally killed by the
accused. The indiscriminate imposition of the death penalty could somehow constrain courts to
apply, perhaps without consciously meaning to, stringent standards for conviction, not too
unlikely beyond what might normally be required in criminal cases, that can, in fact, result in
undue exculpation of offenders to the great prejudice of victims and society.
Today, I reiterate the above view and until the exacting standards of the Constitution are clearly met as so
hereinabove expressed, I will have to disagree, most respectfully, with my colleagues in the majority who
continue to hold the presently structured Republic Act No. 7659 to be in accord with the Constitution, an issue
that is fundamental, constant and inextricably linked to the imposition each time of the death penalty and, like
the instant petition, to the legal incidents pertinent thereto.
Accordingly, I vote against the lifting of the restraining order of the Court even as I, like everyone else,
however, must respect and be held bound by the ruling of the majority.

PANGANIBAN, J., separate opinion;

I agree with the Court's Resolution that, without doubt, this Court has jurisdiction to issue the disputed
Temporary Restraining Order (TRO) on January 4, 1999. I will not repeat its well-reasoned disquisition. I write
only to explain my vote in the context of the larger issue of the death penalty.
Since the solicitor general has demonstrated that Congress will not repeal or amend RA 7659 during its current
session which ends on June 15, 1999 and that, in any event, the President will veto any such repeal or
amendment, the TRO should by its own terms be deemed lifted now. However, my objections to the imposition
of the death penalty transcend the TRO and permeate its juridical essence.
I maintain my view that RA 7659 (the Death Penalty Law) is unconstitutional insofar as some parts thereof
prescribing the capital penalty fail to comply with the requirements of "heinousness" and "compelling reasons"

prescribed by the Constitution of the Philippines. * This I have repeatedly stated in my Dissenting Opinion in
various death cases decided by the Court, as well as during the Court's deliberation on this matter on January 4,
1999. For easy reference, I hereby attach a copy of my Dissent promulgated on February 7, 1997.
Consequently, I cannot now vote to lift TRO, because to do so would mean the upholding and enforcement of
law (or the relevant portions thereof) which, I submit with all due respect, is unconstitutional and therefore
legally nonexistent. I also reiterate that, in my humble opinion, RA 8177 (the Lethal Injection Law) is likewise
unconstitutional since it merely prescribes the manner in which RA 7659 ( the Death Penalty Law) is to
implemented.
Having said that, I stress, however, that I defer to the rule of law and will abide by the ruling of the Court that
both RA 7659 and RA 8177 are constitutional and that death penalty should, by majority vote, be implemented
by means of lethal injection.
FOR THE ABOVE REASONS, I vote to deny the solicitor general's Motion for Reconsideration.
G.R. No. 117472 February 7, 1997
PEOPLE OF THE PHILIPPINES vs. LEO ECHEGARAY y PILO.
Supplemental Motion for Reconsideration
SEPARATE OPINION
Death Penalty Law Unconstitutional
In his Supplemental Motion for Reconsideration 1 dated August 22, 1996 filed by his newly-retained
counsel, 2 the accused raises for the first time a very crucial ground for his defense: that Republic Act. No.
7659, the law reimposing the death penalty, is unconstitutional. In the Brief and (original Motion for
Reconsideration filed by his previous counsel, 3 this transcendental issue was nor brought up. Hence, it was not
passed upon by this Court in its Decision affirming the trial court's sentence of death. 4
The Constitution Abolished Death Penalty
Sec. 19, Article III of the 1987 Constitution provides:
Sec. 19. (1) Excessive fines shall not be imposed, nor cruel, degrading or inhuman punishment
inflicted. Neither shall death penalty be imposed, unless for compelling
reasons involving heinouscrimes, the Congress hereafter provides for it. Any death
penalty already imposed shall be reduced to reclusion perpetua. (Emphasis supplied)
The second and third sentences of the above provision are new and had not been written in the 1935, 1973 or
even in the 1986 "Freedom Constitution." They proscribe the imposition 5 of the death penalty "unless for
compelling reasons involving heinous crimes, Congress provides for it," and reduced "any death penalty already
imposed" to reclusion perpetua. The provision has both a prospective aspect (it bars the future imposition of the
penalty) and a retroactive one (it reduces imposed capital sentences to the lesser penalty of imprisonment).
This two-fold aspect is significant. It stresses that the Constitution did not merely suspend the imposition of the
death penalty, but in fact completely abolished it from the statute books. The automatic commutation or
reduction to reclusion perpetua of any death penalty extant as of the effectivity of the Constitution clearly
recognizes that, while the conviction of an accused for a capital crime remains, death as a penalty ceased to

exist in our penal laws and thus may longer be carried out. This is the clear intent of the framers of our
Constitution. As Comm. Bernas ex-claimed, 6 "(t)he majority voted for the constitutional abolition of the death
penalty."
Citing this and other similar pronouncements of the distinguished Concom delegate, Mme. Justice Ameurfina
Melencio-Herrera emphasized, 7 "It is thus clear that when Fr. Bernas sponsored the provision regarding the
non-imposition of the death penalty, what he had in mind was the total abolition and removal from the statute
books of the death penalty. This became the intent of the frames of the Constitution when they approved the
provision and made it a part of the Bill of Rights." With such abolition as a premise, restoration thereof
becomes an exception to a constitutional mandate. Being an exception and thus in derogation of the
Constitution, it must then be strictly construed against the State and liberally in favor of the people. 8 In this
light, RA 7659 enjoys no presumption of constitutionality.
The Constitution Strictly Limits
Congressional Prerogative to Prescribe Death
To me, it is very clear that the Constitution (1) effectively removed the death penalty from the then existing
statutes but (2) authorized Congress to restore it at some future time to enable or empower courts to reimpose it
on condition that it (Congress) 9 finds "compelling reasons, involving heinous crimes." The language of the
Constitution is emphatic (even if "awkward" 10): the authority of Congress to "provide for it" is not absolute.
Rather, it is strictly limited:
1. by "compelling reasons" that may arise after the Constitution became effective; and
2. to crimes which Congress should identify or define or characterize as "heinous."
The Constitution inexorably placed upon Congress the burden of determining the existence of "compelling
reasons" and of defining what crimes are "heinous" before it could exercise its law-making prerogative to
restore the death penalty. For clarity's sake, may I emphasize that Congress, by law; prescribes the death
penalty on certain crimes; and courts, by their decisions, impose it on individual offenders found guilty beyond
reasonable doubt of committing said crimes.
In the exercise of this fundamental mandate, Congress enacted RA
7659 11 to "provide for it" (the death penalty) (1) by amending certain provisions of the Revised Penal
Code; 12 (2) by incorporating a new article therein; 13 and (3) by amending certain special laws. 14
But RA 7659 did not change the nature or the elements of the crimes stated in the Penal Code and in the special
laws. It merely made the penalty more severe. Neither did its provisions (other than the preamble, which was
cast in general terms) discuss or justify the reasons for the more sever sanction, either collectively for all the
offenses or individually for each of them.
Generally, it merely reinstated the concept of and the method by which the death penalty had been imposed
until February 2, 1987, when the Constitution took effect as follows: (1) a person is convicted of a capital
offense; and (2) the commission of which was accompanied by aggravating circumstances not outweighed by
mitigating circumstances.
The basic question then is: In enacting RA 7659, did Congress exceed the limited authority granted it by the
Constitution? More legally put: It reviving the death penalty, did Congress act with grave abuse of discretion or
in excess of the very limited power or jurisdiction conferred on it by Art. III, Sec. 19? The answer, I respectfully
submit, is YES.
Heinous Crimes

To repeal, while he Constitution limited the power of Congress to prescribe the death penalty ONLY to
"heinous" crimes, it did not define or characterize the meaning of "heinous". Neither did Congress. As already
stated, RA 7659 itself merely selected some existing crimes for which it prescribed death as an applicable
penalty. It did not give a standard or a characterization by which courts may be able to appreciate the
heinousness of a crime. I concede that Congress was only too well aware of its constitutionally limited power.
In deference thereto, it included a paragraph in the preambular or "whereas" clauses of RA 7659, as follows:
WHEREAS, the crimes punishable by death under this Act are heinous for being grievous,
odious and hateful offenses and which, by reason of their inherent or manifest wickedness,
viciousness, atrocity and perversity are repugnant and outrageous to the common standards and
norms of decency and morality in a just, civilized and ordered society.
In my humble view, however, the foregoing clause is clearly an insufficient definition or characterization of
what a heinous crime is. It simply and gratuitously declared certain crimes to be "heinous" without adequately
justifying its bases therefor. It supplies no useful, workable, clear and unambiguous standard by which the
presence of heinousness can be determined. Calling the crimes "grievous, odious and hateful" is not a substitute
for an objective juridical definition. Neither is the description "inherent or manifest wickedness, viciousness,
atrocity and perversity." Describing blood as blue does not detract from its being crimson in fact; and renaming
gumamela as rose will not arm it with thorns.
Besides, a preamble is really not an integral part of a law. It is merely an introduction to show its intent or
purposes. It cannot be the origin of rights and obligations. Where the meaning of a statute is clear and
unambiguous, the preamble can neither expand nor restrict its operation, much less prevail over its text. 15 In
this case, it cannot be the authoritative source to show compliance with the Constitution.
As already alluded to, RA 7659 merely amended certain laws to prescribe death as the maximum imposable
penalty once the court appreciates the presence or absence of aggravating circumstances. 16
In other words, it just reinstated capital punishment for crimes which were already punishable with death prior
to the effectivity of the 1987 Constitution. With the possible exception of plunder and qualified bribery, 17 no
new crimes were introduced by RA 7659. The offenses punished by death under said law were already to
punishable by the Revised Penal Code 18 and by special laws.
During the debate on Senate Bill No. 891 which later became RA 7659, Sen. Jose Lina, in answer to a question
of Sen. Ernesto Maceda, wryly said: 19
So we did not go that far from the Revised Penal Code, Mr. President, and from existing special
laws which, before abolition of the death penalty, had already death as the maximum penalty.
By merely reimposing capital punishment on the very same crimes which were already penalized with death
prior to the charter's effectivity, Congress I submit has not fulfilled its specific and positive constitutional duty.
If the Constitutional Commission intended merely to allow Congress to prescribe death for these very same
crimes, it would not have written Sec. 19 of Article III into the fundamental law. But the stubborn fact is it did.
Verily, the intention to 1) delete the death penalty from our criminal laws and 2) make its restoration possible
only under and subject to stringent conditions is evident not only from the language of the Constitution but also
from the charter debates on this matter.
The critical phrase "unless for compelling reasons involving heinous crimes" was an amendment introduced by
Comm. Christian Monsod. In explaining what possible crimes could qualify as heinous, he and Comm. Jose
Suarez agreed on "organized murder" or "brutal murder of a rape victim". 20 Note that the honorable
commissioners did not just say "murder" but organized murder; not just rape but brutal murder of a rape victim.
While the debates were admittedly rather scanty, I believe that the available information shows that, when

deliberating on "heinousness", the Constitutional Commission did not have in mind the offenses already
existing and already penalized with death. I also believe that the heinousness clause requires that:
1. the crimes should be entirely new offenses, the elements of which have an inherent quality,
degree or level of perversity, depravity or viciousness unheard of until then; or
2. even existing crimes, provided some new element or essential ingredient like "organized" or
"brutal" is added to show their utter perversity, odiousness or malevolence; or
3) the means or method by which the crime, whether new or old, is carried out evinces a degree
or magnitude of extreme violence, evil, cruelty, atrocity, viciousness as to demonstrate its
heinousness.21
For this purpose, Congress could enact an entirely new set of circumstances to qualify the crime as "heinous", in
the same manner that the presence of treachery in a homicide aggravates the crime to murder for which a
heavier penalty is prescribed.
Compelling Reasons
Quite apart from requiring the attendant element of heinousness, the Constitution also directs Congress to
determine "compelling reasons" for the revival of the capital penalty. It is true that paragraphs 3 and 4 of the
preamble of RA 7659 22 made some attempt at meeting this requirement. But such effort was at best feeble and
inconsequential. It should be remembered that every word or phrase in the Constitution is sacred and should
never be ignored, cavalierly-treated or brushed aside. Thus, I believe that the compelling reasons and the
characterization of heinousness cannot be done wholesale but must shown for each and every crime,
individually and separately.
The words "compelling reasons" were included in the Charter because, in the words of Comm. Monsod, "in the
future, circumstances may arise which we should not preclude today . . . and that the conditions and the
situation (during the deliberations of the Constitutional Commission) might change for very specific reasons"
requiring the return of the constitutionally-abhorred penalty.
In his sponsorship of House Bill No. 62 which later evolved into RA 7659, Congressman Pablo Garcia, in
answer to questions raised by Representative Edcel Lagman tried to explain these compelling reasons: 23
MR. LAGMAN: So what are the compelling reasons now, Mr. Speaker? . . .
MR. GARCIA (P.). The worsening peace and order condition in the country, Mr. Speaker. That
is one.
MR. LAGMAN. So the compelling reason which the distinguished sponsor would like to justify
or serve as an anchor for the justification of the reimposition of the death penalty is the alleged
worsening peace and order situation. The Gentleman claims that is one the compelling reasons.
But before we dissent this particular "compelling reason," may we know what are the other
compelling reasons, Mr. Speaker?
MR. GARCIA (P.) Justice, Mr. Speaker.
MR. LAGMAN. Justice.
MR. GARCIA (P.). Yes, Mr. Speaker.

MR. LAGMAN. Justice is a compelling reason, Mr. Speaker? Could the Gentleman kindly
elaborate on that answer? Why is justice a compelling reason as if justice was not obtained at the
time the Constitution abolished the death penalty? Any compelling reason should be a
supervening circumstances after 1987.
MR. GARCIA (P.). Mr. Speaker, I have repeatedly said again and again that if one lives in an
organized society governed by law, justice demands that crime be punished and that the penalty
imposed be commensurate with the offense committed.
MR. LAGMAN. The Gentleman would agree with me that when the Constitution speaks of the
compelling reasons to justify the reimposition of death penalty, it refers to reasons which would
supervene or come after the approval of the 1987 Constitution. Is he submitting that justice, in
his own concept of a commensurate penalty for the offense committed, was not obtained in 1987
when the Constitution abolished the death penalty and the people ratified it?
MR. GARCIA (P.). That is precisely why we are saying that now, under present conditions,
because of the seriousness of the offenses being committed at this time, justice demands that the
appropriate penalty must be meted out for those who have committed heinous crimes.
xxx xxx xxx
In short, Congressman Garcia invoked the preambular justifications of "worsening peace and order" and
"justice". With all due respect I submit that these grounds are not "compelling" enough to justify the revival of
state-decreed deaths. In fact, I dare say that these "reasons" were even non-existent. Statistics from the
Philippine National Police show that the crime volume and crime rate particularly on those legislated capital
offenses did not worsen but in fact declined between 1987, the date when the Constitution took effect, and
1993, the year when RA 7659 was enacted. Witness the following debate 24 also between Representatives
Garcia and Lagman:
MR. LAGMAN. Very good, Mr. Speaker.
Now, can we go to 1987. Could the Gentleman from Cebu inform us the volume of the crime of
murder in 1987?
MR. GARCIA (P.). The volume of the crime of murder in 1987 is 12,305.
MR. LAGMAN. So, the corresponding crime rate was 21 percent.
MR. GARCIA (P.). Yes, Mr. Speaker.
MR. LAGMAN. That was in 1987, Mr. Speaker, could the distinguished chairman inform us the
volume of murder in 1988?
MR. GARCIA (P.). It was 10,521, Mr. Speaker.
MR. LAGMAN. Or it was a reduction from 12,305 in 1987 to 10,521 in 1988. Correspondingly,
the crime rate in the very year after the abolition of the death penalty was reduced from 21
percent to 18 percent. Is that correct, Mr. Speaker?
MR. GARCIA (P.). That is correct, Mr. Speaker. Those are the statistics supplied by the PC.

MR. LAGMAN. Now can we go again to 1987 when the Constitution abolished the death
penalty? May we know from the distinguished Gentleman the volume of robbery in 1987?
MR. GARCIA (P.). Will the Gentleman state the figure? I will confirm it.
MR. LAGMAN. No, Mr. Speaker, I am asking the question.
MR. GARCIA (P.). It was 22,942, Mr. Speaker, and the crime rate was 40 percent.
MR. LAGMAN. This was the year immediately after the abolition of the death penalty. Could
the Gentleman tell us the volume of robbery cases in 1988?
MR. GARCIA (P.). It was 16,926, Mr. Speaker.
MR. LAGMAN. Obviously, the Gentleman would agree with me. Mr. Speaker that the volume of
robbery cases declined from 22,942 in 1987 or crime rate of 40 percent to 16,926 or a crime rate
of 29 percent. Would the Gentleman confirm that, Mr. Speaker?
MR. GARCIA (P.). This is what the statistics say, I understand we are reading now from the
same document.
MR. LAGMAN. Now, going to homicide, the volume 1987 was 12,870 or a crime rate of 22
percent. The volume in 1988 was 11,132 or a crime rate of 19 percent. Would the Gentleman
confirm that, Mr. Speaker?
MR. GARCIA (P.). As I Said, Mr. Speaker, we are reading from the same document and I would
not want to say that the Gentleman is misreading the document that I have here.
MR. LAGMAN. But would the Gentleman confirm that?
MR. GARCIA (P.). The document speaks for itself.
When interpellated by Sen. Arturo Tolentino, Sen. Jose Lina gave some figures on the number of persons
arrested in regard to drug-related offenses in the year 1987 as compared to 1991: 25
Let me cite this concrete statistics by the Dangerous Drug Board.
In 1987 this was the year when the death penalty was abolished the persons arrested in
drug-related cases were 3,062, and the figure dropped to 2,686 in 1988.
By the way, I will furnish my Colleagues with a photocopy of this report.
From 3,062 in 1987, it dropped to 2,686. Again, it increased a bit to 2,862 in 1989. It still
decreased to 2,202 in 1990, and it increased again to 2,862 in 1991.
But in 1987, when the death penalty was abolished, as far as the drug-related cases are
concerned, the figure continued a downward trend, and there was no death penalty in this time
from, 1988 to 1991.
In a further attempt to show compelling reasons, the proponents of the death penalty argue that its reimposition
"would pose as an effective deterrent against heinous crimes." 26 However no statistical data, no sufficient

proof, empirical or otherwise, have been submitted to show with any conclusiveness the relationship between
the prescription of the death penalty for certain offenses and the commission or non-commission thereof. This is
a theory that can be debated on and on, 27 in the same manner that another proposition that the real deterrent
to crime is the certainty of immediate arrest, prosecution and conviction of the culprit without unnecessary risk,
expense and inconvenience to the victim, his heirs or his witnesses can be argued indefinitely. 28 This debate
can last till the academics grow weary of the spoken word, but it would not lessen the constitutionally-imposed
burden of Congress to act within the "heinousness" and "compelling reasons" limits of its death-prescribing
power.
Other Constitutional Rights
Militate Against RA 7659
It should be emphasized that the constitutional ban against the death penalty is included in our Bill of Rights. As
such, it should like any other guarantee in favor of the accused be zealously protected, 29 and any
exception thereto meticulously screened. Any doubt should be resolved in favor of the people, particularly
where the right pertains to persons accused of crimes. 30 Here the issue is not just crimes but capital crimes!
So too, all our previous Constitutions, including the first one ordained at Malolos, guarantee that "(n)o person
shall be deprived of life, liberty or property without due process of law." 31 This primary right of the people to
enjoy life life at its fullest, life in dignity and honor is not only reiterated by the 1987 Charter but is in fact
fortified by its other pro-life and pro-human rights provisions. Hence, the Constitution values the dignity of
every human person and guarantees full respect for human rights, 32 expressly prohibits any form of
torture 33 which is arguably a lesser penalty than death, emphasizes the individual right to life by giving
protection to the life of the mother and the unborn from the moment of conception 34 and establishes the
people's rights to health, a balanced ecology and education. 35
This Constitutional explosion of concern for man more than property for people more than the state, and for life
more than mere existence augurs well for the strict application of the constitutional limits against the revival of
death penalty as the final and irreversible exaction of society against its perceived enemies.
Indeed, volumes have been written about individual rights to free speech. assembly and even religion. But the
most basic and most important of these rights is the right to life. Without life, the other rights cease in their
enjoyment, utility and expression.
This opinion would not be complete without a word on the wrenching fact that the death penalty militates
against the poor, the powerless and the marginalized. The "Profile of 165 Death Row Convicts" submitted by
the Free Legal Assistance Group 36 highlights this sad fact:
1. Since the reimposition of the death penalty, 186 persons 37 have been sentenced to death. At the
end of 1994, there were 24 death penalty convicts, at the end of 1995, the number rose to 90; an
average of seven (7) convicts per month; double the monthly average of capital sentences
imposed the prior year. From January to June 1996, the number of death penalty convicts
reached 72, an average of 12 convicts per month, almost double the monthly average of capital
sentences imposed in 1995.
2. Of the 165 convicts polled, approximately twenty one percent (21%) earn between P200 to
P2,900 monthly; while approximately twenty seven percent (27%) earn between P3,000 to
P3,999 monthly. Those earning above P4,000 monthly are exceedingly few: seven percent (7%)
earn between P4,000 to P4,999, four percent (4%) earn between P5,000 to P5,999, seven percent
(7%) earn between P6,000 to P6,999, those earning between P7,000 to P15,000 comprise only
four percent (4%), those earning P15,000 and above only one percent (1%). Approximately
thirteen percent (13%) earn nothing at all, while approximately two percent (2%) earn

3.

4.

5.

6.

subsistence wages with another five percent (5%) earning variable income. Approximately nine
percent (9%) do not know how much they earn in a month.
Thus, approximately two-thirds of the convicts, about 112 of them, earn below the governmentmandated minimum monthly wage of P4,290; ten (10) of these earn below the official poverty
line set by government. Twenty six (26) earn between P4,500.00 and P11,0000.00 monthly,
indicating they belong to the middle class; only one (1) earns P30.000.00 monthly. Nine (9)
convicts earn variable income or earn on a percentage or allowance basis; fifteen (15) convicts
do not know or are unsure of their monthly income. Twenty two (22) convicts earn nothing at all.
In terms of occupation, approximately twenty one percent (21%) are agricultural workers or
workers in animal husbandry; of these thirty (30), or almost one-fifth thereof, are farmers. Thirty
five percent (35%) are in the transport and construction industry, with thirty one (31)
construction workers or workers in allied fields (carpentry, painting, welding) while twenty
seven (27) are transport workers (delivery, dispatcher, mechanic, tire man, truck helper) with
sixteen (16) of them drivers. Eighteen percent (18%) are in clerical, sales and service industries,
with fourteen (14) sales workers (engaged in buy and sell or fish, cigarette or rice vendors),
twelve (12) service workers (butchers, beauticians, security guards, shoemakers, tour guides,
computer programmers, radio technicians) and four (4) clerks (janitors, MERALCO employee
and clerk) About four percent (4%) are government workers, with six (6) persons belonging to
the armed services (AFP, PNP and even CAFGU). Professionals, administrative employee and
executives comprise only three percent (3%), nine percent (9%) are unemployed.
None of the DRC's use English as their medium of communication. About forty four percent
(44%), or slightly less than half speak and understand Tagalog; twenty six percent (26%), or
about one-fourth, speak and understand Cebuano. The rest speak and understand Bicolano,
Ilocano, Ilonggo, Kapampangan, Pangasinense and Waray. One (1) convict is a foreign national
and speaks and understand Niponggo.
Approximately twelve percent (12%) graduated from college, about forty seven percent (47%)
finished varying levels of elementary education with twenty seven (27) graduating from
elementary. About thirty five percent (35%), fifty eight (58) convicts, finished varying levels of
high school, with more than half of them graduating from high school. Two (2) convicts finished
vocational education; nine (9) convicts did not study at all.

The foregoing profile based on age, language and socio-economic situations sufficiently demonstrates that RA
7659 has militated against the poor and the powerless in society those who cannot afford the legal services
necessary in capital crimes, where extensive preparation, investigation, research and presentation are required.
The best example to shoe the sad plight of the underprivileged is this very case where the crucial issue of
constitutionality was woefully omitted in the proceedings in the trial court and even before this Court until the
Free legal Assistance Group belatedly brought it up in the Supplemental Motion for Reconsideration.
To the poor and unlettered, it is bad enough that the law is complex and written in a strange, incomprehensible
language. Worse still, judicial proceedings are themselves complicated, intimidating and damning. The net
effect of having a death penalty that is imposed more often than not upon the impecunious is to engender in the
minds of the latter, a sense unfounded, to be sure, but unhealthy nevertheless of the unequal balance of
the scales of justice.
Most assuredly, it may be contended that the foregoing arguments, and in particular, the statistics above-cited,
are in a very real sense prone to be misleading, and that regardless of the socio-economic profile of the DRCs,
the law reviving capital punishment does not in any way single out or discriminate against the poor, the
unlettered or the underprivileged. To put it in another way, as far as the disadvantaged are concerned, the law
would still be complex and written in a strange and incomprehensible language, and judicial proceedings
complicated and intimidating, whether the ultimate penalty involved be life (sentence) or death. Another aspect
of the whole controversy is that, whatever the penalties set by law, it seems to me that there will always be
certain class or classes of people in our society who, by reason of their poverty, lack of educational attainment

and employment opportunities, are consequently confined to living, working and subsisting in less-than-ideal
environments, amidst less-than-genteel neighbors similarly situated as themselves, and are therefore inherently
more prone to be involved (as victims or perpetrators) in vices, violence and crime. So from that perspective,
the law reviving the death penalty neither improves nor worsens their lot substantially. Or, to be more precise,
such law may even be said to help improve their situation (at least in theory) by posing a much stronger
deterrent to the commission of heinous crimes.
However, such a viewpoint simply ignores the very basic differences that exist in the situations of the poor and
the non-poor. Precisely because the underprivileged are what they are, they require and deserve a greater degree
of protection and assistance from our laws and Constitution, and from the courts and the State, so that in spite of
themselves, they can be empowered to rise above themselves and their situation. The basic postulates for such a
position are, I think, simply that everyone ultimately wants to better himself and that we cannot better ourselves
individually to any significant degree if we are unable to advance as an entire people and nation. All the propoor provisions of the Constitution point in this direction. Yet we are faced with this law that effectively inflicts
the ultimate punishment on none other than the poor and disadvantaged in the greater majority of cases, and
which penalty, being so obviously final and so irreversibly permanent, erases all hope of reform, of change for
the better. This law, I submit, has no place in our legal, judicial and constitutional firmament.
Epilogue
In sum, I respectfully submit that:
1. The 1987 Constitution abolished the death penalty from our statute books. It did not merely suspend or
prohibit its imposition.
2. The Charter effectively granted a new right: the constitution right against the death penalty, which is
really a species of the right to life.
3. Any law reviving the capital penalty must be strictly construed against the State and liberally in favor of
the accused because such a stature denigrates the Constitution, impinges on a basic right and tends to
deny equal justice to the underprivileged.
4. Every word or phrase in the Constitution is sacred and should never be ignored, cavalierly-treated or
brushed aside.
5. Congressional power death is severely limited by two concurrent requirements:
a. First, Congress must provide a set of attendant circumstances which the prosecution must prove
beyond reasonable doubt, apart from the elements of the crime and itself. Congress must explain
why and how these circumstances define or characterize the crime as "heinous".
Second, Congress has also the duty of laying out clear and specific reasons which arose after the effectivity of
the Constitution compelling the enactment of the law. It bears repeating that these requirements are inseparable.
They must both be present in view of the specific constitutional mandate "for compelling reasons involving
heinous crimes." The compelling reason must flow from the heinous nature of the offense.
1. In every law reviving the capital penalty, the heinousness and compelling reasons must be set out
for each and every crime, and not just for all crimes generally and collectively.
"Thou shall not kill" is fundamental commandment to all Christians, as well as to the rest of the "sovereign
Filipino people" who believe in Almighty God. 38 While the Catholic Church, to which the vast majority of our
people belong, acknowledges the power of public authorities to prescribe the death penalty, it advisedly limits
such prerogative only to "cases of extreme
gravity." 39 To quote Pope John Paul II in his encyclical Evangelium Vitae (A Hymn to Life), 40 "punishment
must be carefully evaluated and decided upon, and ought not to go to the extreme of executing the offender

except in cases of absolute necessity: in other words, when it would not be possible otherwise to defend society .
. . (which is) very rare, if not practically non-existent."
Although not absolutely banning it, both the Constitution and the Church indubitably abhor the death penalty.
Both are pro-people and pro-life. Both clearly recognize the primacy of human life over and above even the
state which man created precisely to protect, cherish and defend him. The Constitution reluctantly allows capital
punishment only for "compelling reasons involving heinous crimes" just as the Church grudgingly permits it
only reasons of "absolute necessity" involving crimes of "extreme gravity", which are very rare and practically
non-existent.
In the face of these evident truisms, I ask: Has the Congress, in enacting RA 7659, amply discharged its
constitutional burden of proving the existence of "compelling reasons" to prescribe death against well-defined
"heinous" crimes?
I respectfully submit it has not.
WHEREFORE, the premises considered, I respectfully vote to grant partially the Supplemental Motion for
Reconsideration and to modify the dispositive portion of the decision of the trial court by deleting the words
"DEATH", as provided for under RA 7659," and substitute therefore reclusion perpetua.
I further vote to declare RA 7659 unconstitutional insofar as it prescribes the penalty of death for the crimes
mentioned in its text.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 77372 April 29, 1988
LUPO L. LUPANGCO, RAYMOND S. MANGKAL, NORMAN A. MESINA, ALEXANDER R.
REGUYAL, JOCELYN P. CATAPANG, ENRICO V. REGALADO, JEROME O. ARCEGA,
ERNESTOC. BLAS, JR., ELPEDIO M. ALMAZAN, KARL CAESAR R. RIMANDO, petitioner,
vs.
COURT OF APPEALS and PROFESSIONAL REGULATION COMMISSION, respondent.
Balgos & Perez Law Offices for petitioners.
The Solicitor General for respondents.

GANCAYCO, J.:
Is the Regional Trial Court of the same category as the Professional Regulation Commission so that it cannot
pass upon the validity of the administrative acts of the latter? Can this Commission lawfully prohibit the
examiness from attending review classes, receiving handout materials, tips, or the like three (3) days before the
date of the examination? Theses are the issues presented to the court by this petition for certiorari to review the
decision of the Court of Appeals promulagated on January 13, 1987, in CA-G.R. SP No. 10598, * declaring null
and void the other dated Ocober 21, 1986 issued by the Regional Trial Court of Manila, Branch 32 in Civil Case
No. 86-37950 entitled " Lupo L. Lupangco, et al. vs. Professional Regulation Commission."
The records shows the following undisputed facts:
On or about October 6, 1986, herein respondent Professional Regulation Commission (PRC) issued Resolution
No. 105 as parts of its "Additional Instructions to Examiness," to all those applying for admission to take the
licensure examinations in accountancy. The resolution embodied the following pertinent provisions:
No examinee shall attend any review class, briefing, conference or the like conducted by, or shall
receive any hand-out, review material, or any tip from any school, college or university, or any
review center or the like or any reviewer, lecturer, instructor official or employee of any of the
aforementioned or similars institutions during the three days immediately proceeding every
examination day including examination day.
Any examinee violating this instruction shall be subject to the sanctions prescribed by Sec. 8,
Art. III of the Rules and Regulations of the Commission. 1
On October 16, 1986, herein petitioners, all reviewees preparing to take the licensure examinations in
accountancy schedule on October 25 and November 2 of the same year, filed on their own behalf of all others
similarly situated like them, with the Regional Trial Court of Manila, Branch XXXII, a complaint for injuction
with a prayer with the issuance of a writ of a preliminary injunction against respondent PRC to restrain the latter
from enforcing the above-mentioned resolution and to declare the same unconstitution.

Respondent PRC filed a motion to dismiss on October 21, 1987 on the ground that the lower court had no
jurisdiction to review and to enjoin the enforcement of its resolution. In an Order of October 21, 1987, the lower
court declared that it had jurisdiction to try the case and enjoined the respondent commission from enforcing
and giving effect to Resolution No. 105 which it found to be unconstitutional.
Not satisfied therewith, respondent PRC, on November 10, 1986, filed with the Court of Appeals a petition for
the nullification of the above Order of the lower court. Said petiton was granted in the Decision of the Court of
Appeals promulagated on January 13, 1987, to wit:
WHEREFORE, finding the petition meritorious the same is hereby GRANTED and the other
dated October 21, 1986 issued by respondent court is declared null and void. The respondent
court is further directed to dismiss with prejudice Civil Case No. 86-37950 for want of
jurisdiction over the subject matter thereof. No cost in this instance.
SO ORDERED. 2
Hence, this petition.
The Court of Appeals, in deciding that the Regional Trial Court of Manila had no jurisdiction to entertain the
case and to enjoin the enforcement of the Resolution No. 105, stated as its basis its conclusion that the
Professional Regulation Commission and the Regional Trial Court are co-equal bodies. Thus it held
That the petitioner Professional Regulatory Commission is at least a co-equal body with the
Regional Trial Court is beyond question, and co-equal bodies have no power to control each
other or interfere with each other's acts. 3
To strenghten its position, the Court of Appeals relied heavily on National Electrification Administration vs.
Mendoza, 4 which cites Pineda vs. Lantin 5 and Philippine Pacific Fishing, Inc. vs. Luna, 6 where this Court
held that a Court of First Instance cannot interfere with the orders of the Securities and Exchange Commission,
the two being co-equal bodies.
After a close scrutiny of the facts and the record of this case,
We rule in favor of the petitioner.
The cases cited by respondent court are not in point. It is glaringly apparent that the reason why this Court ruled
that the Court of First Instance could not interfere with the orders of the Securities and Exchange Commission
was that this was so provided for by the law. In Pineda vs. Lantin, We explained that whenever a party is
aggrieved by or disagree with an order or ruling of the Securities and Exchange Commission, he cannot seek
relief from courts of general jurisdiction since under the Rules of Court and Commonwealth Act No. 83, as
amended by Republic Act No. 635, creating and setting forth the powers and functions of the old Securities and
Exchange Commission, his remedy is to go the Supreme Court on a petition for review. Likewise, in Philippine
Pacific Fishing Co., Inc. vs. Luna, it was stressed that if an order of the Securities and Exchange Commission is
erroneous, the appropriate remedy take is first, within the Commission itself, then, to the Supreme Court as
mandated in Presidential Decree No. 902-A, the law creating the new Securities and Exchange Commission.
Nowhere in the said cases was it held that a Court of First Instance has no jurisdiction over all other government
agencies. On the contrary, the ruling was specifically limited to the Securities and Exchange Commission.
The respondent court erred when it place the Securities and Exchange Commission and the Professional
Regulation Commsision in the same category. As alraedy mentioned, with respect to the Securities and
Exchange Commission, the laws cited explicitly provide with the procedure that need be taken when one is
aggrieved by its order or ruling. Upon the other hand, there is no law providing for the next course of action for

a party who wants to question a ruling or order of the Professional Regulation Commission. Unlike
Commonwealth Act No. 83 and Presidential Decree No. 902-A, there is no provision in Presidential Decree No.
223, creating the Professional Regulation Commission, that orders or resolutions of the Commission are
appealable either to the Court of Appeals or to theSupreme Court. Consequently, Civil Case No. 86-37950,
which was filed in order to enjoin the enforcement of a resolution of the respondent Professional Regulation
Commission alleged to be unconstitutional, should fall within the general jurisdiction of the Court of First
Instance, now the Regional Trial Court. 7
What is clear from Presidential Decree No. 223 is that the Professional Regulation Commission is attached to
the Office of the President for general direction and coordination. 8 Well settled in our jurisprudence is the view
that even acts of the Office of the President may be reviewed by the Court of First Instance (now the Regional
Trial Court). In Medalla vs. Sayo, 9 this rule was thoroughly propounded on, to wit:
In so far as jurisdiction of the Court below to review by certiorari decisions and/or resolutions of
the Civil Service Commission and of the residential Executive Asssistant is concerned, there
should be no question but that the power of judicial review should be upheld. The following
rulings buttress this conclusion:
The objection to a judicial review of a Presidential act arises from a failure to
recognize the most important principle in our system of government, i.e., the
separation of powers into three co-equal departments, the executives, the
legislative and the judicial, each supreme within its own assigned powers and
duties. When a presidential act is challenged before the courts of justice, it is not
to be implied therefrom that the Executive is being made subject and subordinate
to the courts. The legality of his acts are under judicial review, not because the
Executive is inferior to the courts, but because the law is above the Chief
Executive himself, and the courts seek only to interpret, apply or implement it
(the law). A judicial review of the President's decision on a case of an employee
decided by the Civil Service Board of Appeals should be viewed in this light and
the bringing of the case to the Courts should be governed by the same principles
as govern the jucucial review of all administrative acts of all administrative
officers. 10
Republic vs. Presiding Judge, CFI of Lanao del Norte, Br. II, 11 is another case in point. Here, "the Executive
Office"' of the Department of Education and Culture issued Memorandum Order No. 93 under the authority of
then Secretary of Education Juan Manuel. As in this case, a complaint for injunction was filed with the Court of
First Instance of Lanao del Norte because, allegedly, the enforcement of the circular would impair some
contracts already entered into by public school teachers. It was the contention of petitioner therein that "the
Court of First Instance is not empowered to amend, reverse and modify what is otherwise the clear and explicit
provision of the memorandum circular issued by the Executive Office which has the force and effect of law." In
resolving the issue, We held:
... We definitely state that respondent Court lawfully acquired jurisdiction in Civil Case No. II240 (8) because the plaintiff therein asked the lower court for relief, in the form of injunction, in
defense of a legal right (freedom to enter into contracts) . . . . .
Hence there is a clear infringement of private respondent's constitutional right to enter into
agreements not contrary to law, which might run the risk of being violated by the threatened
implementation of Executive Office Memorandum Circular No. 93, dated February 5, 1968,
which prohibits, with certain exceptions, cashiers and disbursing officers from honoring special
powers of attorney executed by the payee employees. The respondent Court is not only right but
duty bound to take cognizance of cases of this nature wherein a constitutional and statutory right

is allegedly infringed by the administrative action of a government office. Courts of first Instance
have original jurisdiction over all civil actions in which the subject of the litigation is not
capable of pecuniary estimation (Sec. 44, Republic Act 296, as amended). 12 (Emphasis
supplied.)
In San Miguel Corporation vs. Avelino, 13 We ruled that a judge of the Court of First Instance has the authority
to decide on the validity of a city tax ordinance even after its validity had been contested before the Secretary of
Justice and an opinion thereon had been rendered.
In view of the foregoing, We find no cogent reason why Resolution No. 105, issued by the respondent
Professional Regulation Commission, should be exempted from the general jurisdiction of the Regional Trial
Court.
Respondent PRC, on the other hand, contends that under Section 9, paragraph 3 of B.P. Blg. 129, it is the Court
of Appeals which has jurisdiction over the case. The said law provides:
SEC. 9. Jurisdiction. The Intermediate Appellate Court shall exercise:
xxx xxx xxx
(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders, or
awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or
commissions, except those falling within the appellate jurisdiction of the Supreme Court in
accordance with the Constitution, the provisions of this Act, and of subparagraph (1) of the third
paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of
1948.
The contention is devoid of merit.
In order to invoke the exclusive appellate jurisdiction of the Court of Appeals as provided for in Section 9,
paragraph 3 of B.P. Blg. 129, there has to be a final order or ruling which resulted from proceedings wherein the
administrative body involved exercised its quasi-judicial functions. In Black's Law Dictionary, quasi-judicial is
defined as a term applied to the action, discretion, etc., of public administrative officers or bodies required to
investigate facts, or ascertain the existence of facts, hold hearings, and draw conclusions from them, as a basis
for their official action, and to exercise discretion of a judicial nature. To expound thereon, quasijudicial adjudication would mean a determination of rights, privileges and duties resulting in a decision or order
which applies to a specific situation . 14 This does not cover rules and regulations of general applicability issued
by the administrative body to implement its purely administrative policies and functions like Resolution No.
105 which was adopted by the respondent PRC as a measure to preserve the integrity of licensure examinations.
The above rule was adhered to in Filipinas Engineering and Machine Shop vs. Ferrer. 15 In this case, the issue
presented was whether or not the Court of First Instance had jurisdiction over a case involving an order of the
Commission on Elections awarding a contract to a private party which originated from an invitation to bid. The
said issue came about because under the laws then in force, final awards, judgments, decisions or orders of the
Commission on Elections fall within the exclusive jurisdiction of the Supreme Court by way of certiorari.
Hence, it has been consistently held that "it is the Supreme Court, not the Court of First Instance, which has
exclusive jurisdiction to review on certiorari final decisions, orders, or rulings of the Commission on Elections
relative to the conduct of elections and the enforcement of election laws." 16
As to whether or not the Court of First Instance had jurisdiction in saidcase, We said:

We are however, far from convinced that an order of the COMELEC awarding a contract to a
private party, as a result of its choice among various proposals submitted in response to its
invitation to bid comes within the purview of a "final order" which is exclusively and directly
appealable to this court on certiorari. What is contemplated by the term "final orders, rulings and
decisions, of the COMELEC reviewable by certiorari by the Supreme Court as provided by law
are those rendered in actions or proceedings before the COMELEC and taken cognizance of by
the said body in the exercise of its adjudicatory or quasi-judicial powers. (Emphasis supplied.)
xxx xxx xxx
We agree with petitioner's contention that the order of the Commission granting the award to a
bidder is not an order rendered in a legal controversy before it wherein the parties filed their
respective pleadings and presented evidence after which the questioned order was issued; and
that this order of the commission was issued pursuant to its authority to enter into contracts in
relation to election purposes. In short, the COMELEC resolution awarding the contract in favor
of Acme was not issued pursuant to its quasi-judicial functions but merely as an incident of its
inherent administrative functions over the conduct of elections, and hence, the said resolution
may not be deemed as a "final order reviewable by certiorari by the Supreme Court. Being nonjudicial in character, no contempt order may be imposed by the COMELEC from said order, and
no direct and exclusive appeal by certiorari to this Tribunal lie from such order. Any question
arising from said order may be well taken in an ordinary civil action before the trial courts.
(Emphasis supplied.) 17
One other case that should be mentioned in this regard is Salud vs. Central Bank of the Philippines. 18 Here,
petitioner Central Bank, like respondent in this case, argued that under Section 9, paragraph 3 of B.P. Blg. 129,
orders of the Monetary Board are appealable only to the Intermediate Appellate Court. Thus:
The Central Bank and its Liquidator also postulate, for the very first time, that the Monetary
Board is among the "quasi-judicial ... boards" whose judgments are within the exclusive
appellate jurisdiction of the IAC; hence, it is only said Court, "to the exclusion of the Regional
Trial Courts," that may review the Monetary Board's resolutions. 19
Anent the posture of the Central Bank, We made the following pronouncement:
The contention is utterly devoid of merit. The IAC has no appellate jurisdiction over resolution
or orders of the Monetary Board. No law prescribes any mode of appeal from the Monetary
Board to the IAC. 20
In view of the foregoing, We hold that the Regional Trial Court has jurisdiction to entertain Civil Case No. 8637950 and enjoin the respondent PRC from enforcing its resolution.
Although We have finally settled the issue of jurisdiction, We find it imperative to decide once and for all the
validity of Resolution No. 105 so as to provide the much awaited relief to those who are and will be affected by
it.
Of course, We realize that the questioned resolution was adopted for a commendable purpose which is "to
preserve the integrity and purity of the licensure examinations." However, its good aim cannot be a cloak to
conceal its constitutional infirmities. On its face, it can be readily seen that it is unreasonable in that an
examinee cannot even attend any review class, briefing, conference or the like, or receive any hand-out, review
material, or any tip from any school, collge or university, or any review center or the like or any reviewer,
lecturer, instructor, official or employee of any of the aforementioned or similar institutions . ... 21

The unreasonableness is more obvious in that one who is caught committing the prohibited acts even without
any ill motives will be barred from taking future examinations conducted by the respondent PRC. Furthermore,
it is inconceivable how the Commission can manage to have a watchful eye on each and every examinee during
the three days before the examination period.
It is an aixiom in administrative law that administrative authorities should not act arbitrarily and capriciously in
the issuance of rules and regulations. To be valid, such rules and regulations must be reasonable and fairly
adapted to the end in view. If shown to bear no reasonable relation to the purposes for which they are authorized
to be issued, then they must be held to be invalid. 22
Resolution No. 105 is not only unreasonable and arbitrary, it also infringes on the examinees' right to liberty
guaranteed by the Constitution. Respondent PRC has no authority to dictate on the reviewees as to how they
should prepare themselves for the licensure examinations. They cannot be restrained from taking all the lawful
steps needed to assure the fulfillment of their ambition to become public accountants. They have every right to
make use of their faculties in attaining success in their endeavors. They should be allowed to enjoy their
freedom to acquire useful knowledge that will promote their personal growth. As defined in a decision of the
United States Supreme Court:
The term "liberty" means more than mere freedom from physical restraint or the bounds of a
prison. It means freedom to go where one may choose and to act in such a manner not
inconsistent with the equal rights of others, as his judgment may dictate for the promotion of his
happiness, to pursue such callings and vocations as may be most suitable to develop his
capacities, and giv to them their highest enjoyment. 23
Another evident objection to Resolution No. 105 is that it violates the academic freedom of the schools
concerned. Respondent PRC cannot interfere with the conduct of review that review schools and centers believe
would best enable their enrolees to meet the standards required before becoming a full fledged public
accountant. Unless the means or methods of instruction are clearly found to be inefficient, impractical, or
riddled with corruption, review schools and centers may not be stopped from helping out their students. At this
juncture, We call attention to Our pronouncement in Garcia vs. The Faculty Admission Committee, Loyola
School of Theology, 24 regarding academic freedom to wit:
... It would follow then that the school or college itself is possessed of such a right. It decides for
itself its aims and objectives and how best to attain them. It is free from outside coercion or
interference save possibly when the overriding public welfare calls for some restraint. It has a
wide sphere of autonomy certainly extending to the choice of students. This constitutional
provision is not to be construed in a niggardly manner or in a grudging fashion.
Needless to say, the enforcement of Resolution No. 105 is not a guarantee that the alleged leakages in the
licensure examinations will be eradicated or at least minimized. Making the examinees suffer by depriving them
of legitimate means of review or preparation on those last three precious days-when they should be refreshing
themselves with all that they have learned in the review classes and preparing their mental and psychological
make-up for the examination day itself-would be like uprooting the tree to get ride of a rotten branch. What is
needed to be done by the respondent is to find out the source of such leakages and stop it right there. If corrupt
officials or personnel should be terminated from their loss, then so be it. Fixers or swindlers should be flushed
out. Strict guidelines to be observed by examiners should be set up and if violations are committed, then
licenses should be suspended or revoked. These are all within the powers of the respondent commission as
provided for in Presidential Decree No. 223. But by all means the right and freedom of the examinees to avail of
all legitimate means to prepare for the examinations should not be curtailed.

In the light of the above, We hereby REVERSE and SET ASIDE, the decision of the Court of Appeals in CAG.R. SP No. 10591 and another judgment is hereby rendered declaring Resolution No. 105 null and void and of
no force and effect for being unconstitutional. This decision is immediately executory. No costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 109023 August 12, 1998

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

PURISIMA, J.:
The pivotal issue raised in this petition is whether or not the petitioners are entitled to the payment of honoraria
which they were receiving prior to the effectivity of Rep. Act 6758.
Petitioners are employees of the Local Water Utilities Administration (LWUA). Prior to July 1, 1989, they were
receiving honoraria as designated members of the LWUA Board Secretariat and the Pre-Qualification, Bids and
Awards Committee.
On July 1, 1989, Republic Act No. 6758 (Rep. Act 6758), entitled "An Act Prescribing A Revised
Compensation and Position Classification System in the Government and For Other Purposes", took effect.
Section 12 of said law provides for the consolidation of allowances and additional compensation into
standardized salary rates. Certain additional compensations, however, were exempted from consolidation.
Sec. 12. Rep. Act 6758, reads
Sec. 12. Consolidation of Allowances and Compensation. Allowances, except for
representation and transportation allowances; clothing and laundry allowances; subsistense
allowance of marine officers and crew on board government vessels and hospital personnel;
hazard pay: allowances of foreign services personnel stationed abroad; and such other additional
compensation not otherwise specified herein as may be determined by the DBM, shall be
deemed included in the standardized salary rules herein prescribed. Such other additional
compensation, whether in cash or in kind, being received by incumbents as of July 1, 1989 no
integrated into the standardized salary rates shall continue to be authorized. 1 (Emphasis
supplied)
To implement Rep. Act 6758, the Department of Budget and Management (DBM) issued Corporate
Compensation Circular No. 10 (DBM-CCC No. 10), discontinuing without qualification effective November 1,
1989, all allowances and fringe benefits granted on top of basic salary.
Paragraph 5.6 of DBM-CCC No. 10 provides:

Payment of other allowances fringe benefits and all other forms of compensation granted on top
of basic salary, whether in cash or in kind, . . . shall be discontinued effective November 1, 1989.
Payment made for such allowances fringe benefits after said date shall be considered as illegal
disbursement of public funds. 2
Pursuant to the aforesaid Law and Circular, respondent Leonardo Jamoralin, as corporate auditor, disallowed on
post audit, the payment of honoraria to the herein petitioners.
Aggrieved, petitioners appealed to the COA, questioning the validity and enforceability of DBM-CCC No. 10.
More specifically, petitioners contend that DBM-CCC No. 10 is inconsistent with the provisions of Rep. Act
6758 (the law it is supposed to implement) and, therefore, void. And it is without force and effect because it was
not published in the Official Gazette; petitioners stressed.
In its decision dated January 29, 1993, the COA upheld the validity and effectivity of DBM-CCC No. 10 and
sanctioned the disallowance of petitioners' honoraria. 3
Undaunted, petitioners found their way to this court via the present petition, posing the questions:
(1) Whether or not par. 5.6 of DBM-CCC No. 10 can supplant or negate the express provisions
of Sec. 12 of Rep. Act 6758 which it seeks to implement; and
(2) Whether or not DBM-CCC No. 10 is legally effective despite its lack of publication in the
Official Gazette.
Petitioners are of the view that par. 5.6 of DBM-CCC No. 10 prohibiting fringe benefits and allowances
effective November 1, 1989, is violative of Sec. 12 of Rep. Act 6758 which authorizes payment of additional
compensation not integrated into the standardized salary which incumbents were enjoying prior to July 1, 1989.
To buttress petitioners' stance, the Solicitor General presented a Manifestation and Motion in Lieu of Comment,
opining that Sec. 5.6 of DBM-CCC No. 10 is a nullity for being inconsistent with and repugnant to the very law
it is intended to implement. The Solicitor General theorized, that:
. . . following the settled principle that implementing rules must necessarily adhere to and not
depart from the provisions of the statute it seeks to implement, it is crystal clear that Section 5.6
of DBM-CCC No. 10 is a patient nullity. An implementing rule can only be declared valid if it is
in harmony with the provision of the legislative act and for the sole purpose of carrying into
effect its general provisions. When an implementing rule is inconsistent or repugnant to the
provision of the statute it seeks to interpret, the mandate of the statute must prevail and must be
followed. 4
Respondent COA, on the other hand, pointed out that to allow honoraria without statutory, presidential or DBM
authority, as in this case, would run counter to Sec. 8, Article IX-B of the Constitution which proscribes
payment of "additional or double compensation, unless specifically authorized by law." Therefore, the grant of
honoraria or like allowances requires a specific legal or statutory authority. And DBM-CCC No. 10 need not be
published for it is merely an interpretative regulation of a law already published 5; COA concluded.
In his Motion for Leave to intervene, the DBM Secretary asserted that the honoraria in question are considered
included in the basic salary, for the reason that they are not listed as exceptions under Sec. 12 of Rep. Act 6758.
Before resolving the other issue whether or not Paragraph 5.6 of DBM-CCC No. 10 can supplant or negate
the pertinent provisions of Rep. Act 6758 which it seeks to implement, we have to tackle first the other question
whether or not DBM-CCC No. 10 has legal force and effect notwithstanding the absence of publication thereof

in the Official Gazette. This should take precedence because should we rule that publication in the Official
Gazette or in a newspaper of general circulation in the Philippines 6 is sine qua non to the effectiveness or
enforceability of DBM-CCC No. 10, resolution of the first issue posited by petitioner would not be necessary.
The applicable provision of law requiring publication in the Official Gazette is found in Article 2 of the New
Civil Code of the Philippines, which reads:
Art. 2. Laws shall take effect after fifteen days following the completion of their publications in
the Official Gazette, unless it is otherwise provided. This code shall take effect one year after
such publication.
In Tanada v. Tuvera, 146 SCRA 453, 454, this Court succinctly construed the aforecited provision of law in
point, thus:
We hold therefore that all statutes, including those of local application and privates laws, shall be
published as a condition for their effectivity, which shall begin after fifteen days after publication
unless a different effectivity date is fixed by the legislature.
Covered by this rule are presidential decrees and executive orders promulgated by the President
in the exercise of legislative powers whenever the same are validly delegated by the legislature
or, at present, directly conferred by the Constitution. Administrative rules and regulations must
also be published if their purpose is to enforced or implement existing law pursuant to a valid
delegation.
Interpretative regulations and those merely internal in nature, that is, regulating only the
personnel of the administrative agency and not the public, need not be published. Neither is
publication required of the so-called letters of instructions issued by administrative superiors
concerning the rules or guidelines to be followed by their subordinates in the performance of
their duties.
Accordingly, even the charter of a city must be published notwithstanding that it applies to only
one portion of the national territory and directly affects only the inhabitants of that place. All
presidential decrees must be published, including, even, say those naming a public place after a
favored individual or exempting him from a certain prohibitions or requirements. The circulars
issued by the Monetary Board must be published if they are meant not merely interpret but
to "fill in details" of the Central Bank Act which that body supposed to enforce. (Emphasis ours)
The same ruling was reiterated in the case of Philippine Association of Service Exporters, Inc. vs.
Torres, 212 SCRA 299 [1992].
On the need for publication of subject DBM-CCC No. 10, we rule in the affirmative. Following the doctrine
enunciated in Tanada, publication in the Official Gazette or in a newspaper of general circulation in the
Philippines is required since DBM-CCC No. 10 is in the nature of an administrative circular the purpose of
which is to enforce or implement an existing law. Stated differently, to be effective and enforceable, DBM-CCC
No. 10 must go through the requisite publication in the Official Gazette or in a newspaper of general circulation
in the Philippines.
In the present case under scrutiny, it is decisively clear that DBM-CCC No. 10, which completely disallows
payment of allowances and other additional compensation to government officials and employees, starting
November 1, 1989, is not a mere interpretative or internal regulation. It is something more than that. And why
not, when it tends to deprive government workers of their allowances and additional compensation sorely
needed to keep body and soul together. At the very least, before the said circular under attack may be permitted

to substantially reduce their income, the government officials and employees concerned should be apprised and
alerted by the publication of subject circular in the Official Gazette or in a newspaper of general circulation in
the Philippines to the end that they be given amplest opportunity to voice out whatever opposition they may
have, and to ventilate their stance on the matter. This approach is more in keeping with democratic precepts and
rudiments of fairness and transparency.
In light of the foregoing disquisition on the ineffectiveness of DBM-CCC No. 10 due to its non-publication in
the Official Gazette or in a newspaper of general circulation in the country, as required by law, resolution of the
other issue at bar is unnecessary.
WHEREFORE, the Petition is hereby GRANTED, the assailed Decision of respondent Commission on Audit is
SET ASIDE, and respondents are ordered to pass on audit the honoraria of petitioners. No pronouncement as to
costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 109583 September 5, 1997

TRANS ACTION OVERSEAS CORPORATION, petitioner,
vs.
THE HONORABLE SECRETARY OF LABOR, ROSELLE CASTIGADOR, JOSEFINA MAMON,
JENELYN CASA, PEACHY LANIOG, VERDELINA BELGIRA, ELMA FLORES, RAMONA
LITURCO, GRACE SABANDO, GLORIA PALMA, AVELYN ALVAREZ, CANDELARIA NONO,
NITA BUSTAMANTE, CYNTHIA ARANDILLO, SANDIE AGUILAR, DIGNA PANAGUITON,
VERONICA BAYOGOS, JULIANITA ARANADOR, LEONORA CABALLERO, NANCY BOLIVAR,
NIMFA BUCOL, ZITA GALINDO, ESTELITA BIOCOS, MARJORIE MACATE, RUBY
SEPULVIDA, ROSALIE SONDIA, NORA MAQUILING, PAULINA CORDERO, LENIROSE
ABANGAN, SELFA PALMA, ANTONIA NAVARRO, ELSIE PENARUBIA, IRMA SOBREQUIL,
SONY JAMUAT, CLETA MAYO,respondents.

ROMERO, J.:
The issue presented in the case at bar is whether or not the Secretary of Labor and Employment has jurisdiction
to cancel or revoke the license of a private fee-charging employment agency.
From July 24 to September 9, 1987, petitioner Trans Action Overseas Corporation, a private fee-charging
employment agency, scoured Iloilo City for possible recruits for alleged job vacancies in Hongkong. Private
respondents sought employment as domestic helpers through petitioner's employees, Luzviminda Aragon, Ben
Hur Domincil and his wife Cecille. The applicants paid placement fees ranging from P1,000.00 to P14,000.00,
but petitioner failed to deploy them. Their demands for refund proved unavailing; thus, they were constrained to
institute complaints against petitioner for violation of Articles 32 and 34(a) 1 of the Labor Code, as amended.
Petitioner denied having received the amounts allegedly collected from respondents, and averred that Aragon,
whose only duty was to pre-screen and interview applicants, and the spouses Domincil were not authorized to
collect fees from the applicants. Accordingly, it cannot be held liable for the money claimed by respondents.
Petitioner maintains that it even warned respondents not to give any money to unauthorized individuals.
POEA Regional Extension Unit Coordinator Edgar Somes testified that although he was aware that petitioner
collected fees from respondents, the latter insisted that they be allowed to make the payments on the assumption
that it could hasten their deployment abroad. He added that Mrs. Honorata Manliclic, a representative of
petitioner tasked to oversee the conduct of the interviews, told him that she was leaving behind presigned
receipts to Aragon as she cannot stay in Iloilo City for the screening of the applicants. Manliclic, however,
denied this version and argued that it was Somes who instructed her to leave the receipts behind as it was
perfectly alright to collect fees.
On April 5, 1991, then Labor Undersecretary Nieves R. Confesor rendered the assailed order, the dispositive
portion of which reads:

WHEREFORE, respondents are hereby ordered to pay, jointly and severally, the following
claims:
1. Rosele Castigador P14,000.00
2. Josefina Mamon 3,000.00
3. Jenelyn Casa 3,000.00
4. Peachy Laniog 13,500.00
5. Verdelina Belgira 2,000.00
6. Elma Flores 2,500.00
7. Ramona Liturco 2,500.00
8. Grace Sabando 3,500.00
9. Gloria Palma 1,500.00
10. Avelyn Alvarez 1,500.00
11. Candelaria Nono 1,000.00
12. Nita Bustamante 5,000.00
13. Cynthia Arandillo 1,000.00
14. Sandie Aguilar 3,000.00
15. Digna Panaguiton 2,500.00
16. Veronica Bayogos 2,000.00
17. Sony Jamuat 4,500.00
18. Irma Sobrequil 2,000.00
19. Elsie Penarubia 2,000.00
20. Antonia Navarro 2,000.00
21. Selfa Palma 3,000.00
22. Lenirose Abangan 13,300.00
23. Paulina Cordero 1,400.00
24. Nora Maquiling 2,000.00
25. Rosalie Sondia 2,000.00
26. Ruby Sepulvida 3,500.00
27. Marjorie Macate 1,500.00
28. Estelita Biocos 3,000.00
29. Zita Galindo 3,500.00
30. Nimfa Bucol 1,000.00
31. Nancy Bolivar 2,000.00
32. Leonora Caballero 13,900.00
33. Julianita Aranador 14,000.00
The complaints of Ma. Luz Alingasa, Nimfa Perez, and Cleta Mayo are hereby dismissed in view
of their desistance.
The following complaints are hereby dismissed for failure to appear/prosecute:
1. Jiyasmin Bantillo 6. Edna Salvante
2. Rosa de Luna Senail 7. Thelma Beltiar
3. Elnor Bandojo 8. Cynthia Cepe
4. Teresa Caldeo 9. Rosie Pavillon
5. Virginia Castroverde
The complaints filed by the following are hereby dismissed for lack of evidence:
1. Aleth Palomaria 5. Mary Ann Beboso
2. Emely Padrones 6. Josefina Tejero

3. Marybeth Aparri 7. Bernadita Aprong

4. Lenia Biona 8. Joji Lull
Respondent agency is liable for twenty eight (28) counts of violation of Article 32 and five (5)
counts of Article 34 (a) with a corresponding suspension in the aggregate period of sixty six (66)
months. Considering however, that under the schedule of penalties, any suspension amounting to
a period of 12 months merits the imposition of the penalty of cancellation, the license of
respondent TRANS ACTION OVERSEAS CORPORATION to participate in the overseas
placement and recruitment of workers is hereby ordered CANCELLED, effective immediately.
SO ORDERED. 2 (Emphasis supplied)
On April 29, 1991, petitioner filed its Motion for Temporary Lifting of Order of Cancellation alleging, among
other things, that to deny it the authority to engage in placement and recruitment activities would jeopardize not
only its contractual relations with its foreign principals, but also the welfare, interests, and livelihood of
recruited workers scheduled to leave for their respective assignments. Finally, it manifested its willingness to
post a bond to insure payment of the claims to be awarded, should its appeal or motion be denied.
Finding the motion to be well taken, Undersecretary Confesor provisionally lifted the cancellation of petitioner's
license pending resolution of its Motion for Reconsideration filed on May 6, 1991. On January 30, 1992,
however, petitioner's motion for reconsideration was eventually denied for lack of merit, and the April 5, 1991,
order revoking its license was reinstated.
Petitioner contends that Secretary; Confesor acted with grave abuse of discretion in rendering the assailed
orders on alternative grounds, viz.: (1) it is the Philippine Overseas Employment Administration (POEA) which
has the exclusive and original jurisdiction to hear and decide illegal recruitment cases, including the authority to
cancel recruitment licenses, or (2) the cancellation order based on the 1987 POEA Schedule of Penalties is not
valid for non-compliance with the Revised Administrative Code of 1987 regarding its registration with the U.P.
Law Center.
Under Executive Order No. 797 3 (E.O. No. 797) and Executive Order No. 247 (E.O. No. 247), 4 the POEA was
established and mandated to assume the functions of the Overseas Employment Development Board (OEDB),
the National Seamen Board (NSB), and the overseas employment function of the Bureau of Employment
Services (BES). Petitioner theorizes that when POEA absorbed the powers of these agencies, Article 35 of the
Labor Code, as amended, was rendered ineffective.
The power to suspend or cancel any license or authority to recruit employees for overseas employment is vested
upon the Secretary of Labor and Employment. Article 35 of the Labor Code, as amended, which provides:
Art. 5. Suspension and/or Cancellation of License or Authority The Minister of Labor shall
have the power to suspend or cancel any license or authority to recruit employees for overseas
employment for violation of rules and regulations issued by the Ministry of Labor, the Overseas
Employment Development Board, and the National Seamen Board, or for violation of the
provisions of this and other applicable laws, General Orders and Letters of Instructions.
In the case of Eastern Assurance and Surety Corp. v. Secretary of
Labor, 5 we held that:
The penalties of suspension and cancellation of license or authority are prescribed for violations
of the above quoted provisions, among others. And the Secretary of Labor has the power under
Section 35 of the law to apply these sanctions, as well as the authority, conferred by Section 36,
not only to "restrict and regulate the recruitment and placement activities of all agencies," but

also to "promulgate rules and regulations to carry out the objectives and implement the
provisions" governing said activities. Pursuant to this rule-making power thus granted, the
Secretary of Labor gave the POEA, 6"on its own initiative or upon filing of a complaint or report
or upon request for investigation by any aggrieved person, . . (authority to) conduct the necessary
proceedings for the suspension or cancellation of the license or authority of any agency or entity"
for certain enumerated offenses including
1) the imposition or acceptance, directly or indirectly, of any amount of money, goods or
services, or any fee or bond in excess of what is prescribed by the Administration, and
2) any other violation of pertinent provisions of the Labor Code and other relevant laws, rules
and regulations. 7
The Administrator was also given the power to "order the dismissal of the case of the suspension
of the license or authority of the respondent agency or contractor or recommend to the Minister
the cancellation thereof." 8(Emphasis supplied)
This power conferred upon the Secretary of Labor and Employment was echoed in People v. Diaz, 9 viz.:
A non-licensee or non-holder of authority means any person, corporation or entity which has not
been issued a valid license or authority to engage in recruitment and placement by the Secretary
of Labor, or whose license or authority has been suspended, revoked or cancelled by the POEA
or the Secretary. (Emphasis supplied)
In view of the Court's disposition on the matter, we rule that the power to suspend or cancel any license or
authority to recruit employees for overseas employment is concurrently vested with the POEA and the Secretary
of Labor.
As regards petitioner's alternative argument that the non-filing of the 1987 POEA Schedule of Penalties with the
UP Law Center rendered it ineffective and, hence, cannot be utilized as basis for penalizing them, we agree with
Secretary Confesor's explanation, to wit:
On the other hand, the POEA Revised Rules on the Schedule of Penalties was issued pursuant to
Article 34 of the Labor Code, as amended. The same merely amplified and particularized the
various violations of the rules and regulations of the POEA and clarified and specified the
penalties therefore (sic). Indeed, the questioned schedule of penalties contains only a listing of
offenses. It does not prescribe additional rules and regulations governing overseas employment
but only detailed the administrative sanctions imposable by this Office for some enumerated
prohibited acts.
Under the circumstances, the license of the respondent agency was cancelled on the authority of
Article 35 of the Labor Code, as amended, and not pursuant to the 1987 POEA Revised Rules on
Schedule of Penalties. 10
WHEREFORE, in view of the foregoing, the instant petition is hereby DISMISSED. Accordingly, the decision
of the Secretary of Labor dated April 5, 1991, is AFFIRMED. No costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-32166 October 18, 1977
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellant,
vs.
HON. MAXIMO A. MACEREN CFI, Sta. Cruz, Laguna, JOSE BUENAVENTURA, GODOFREDO
REYES, BENJAMIN REYES, NAZARIO AQUINO and CARLO DEL ROSARIO, accused-appellees.
Office of the Solicitor General for appellant.
Rustics F. de los Reyes, Jr. for appellees.

AQUINO, J.:t.hqw
This is a case involving the validity of a 1967 regulation, penalizing electro fishing in fresh water fisheries,
promulgated by the Secretary of Agriculture and Natural Resources and the Commissioner of Fisheries under
the old Fisheries Law and the law creating the Fisheries Commission.
On March 7, 1969 Jose Buenaventura, Godofredo Reyes, Benjamin Reyes, Nazario Aquino and Carlito del
Rosario were charged by a Constabulary investigator in the municipal court of Sta. Cruz, Laguna with having
violated Fisheries Administrative Order No. 84-1.
It was alleged in the complaint that the five accused in the morning of March 1, 1969 resorted to electro fishing
in the waters of Barrio San Pablo Norte, Sta. Cruz by "using their own motor banca, equipped with motor; with
a generator colored green with attached dynamo colored gray or somewhat white; and electrocuting device
locally known as sensored with a somewhat webbed copper wire on the tip or other end of a bamboo pole with
electric wire attachment which was attached to the dynamo direct and with the use of these devices or
equipments catches fish thru electric current, which destroy any aquatic animals within its cuffed reach, to the
detriment and prejudice of the populace" (Criminal Case No. 5429).
Upon motion of the accused, the municipal court quashed the complaint. The prosecution appealed. The Court
of First Instance of Laguna affirmed the order of dismissal (Civil Case No. SC-36). The case is now before this
Court on appeal by the prosecution under Republic Act No. 5440.
The lower court held that electro fishing cannot be penalize because electric current is not an obnoxious or
poisonous substance as contemplated in section I I of the Fisheries Law and that it is not a substance at all but a
form of energy conducted or transmitted by substances. The lower court further held that, since the law does not
clearly prohibit electro fishing, the executive and judicial departments cannot consider it unlawful.
As legal background, it should be stated that section 11 of the Fisheries Law prohibits "the use of any
obnoxious or poisonous substance" in fishing.

Section 76 of the same law punishes any person who uses an obnoxious or poisonous substance in fishing with
a fine of not more than five hundred pesos nor more than five thousand, and by imprisonment for not less than
six months nor more than five years.
It is noteworthy that the Fisheries Law does not expressly punish .electro fishing." Notwithstanding the silence
of the law, the Secretary of Agriculture and Natural Resources, upon the recommendation of the Commissioner
of Fisheries, promulgated Fisheries Administrative Order No. 84 (62 O.G. 1224), prohibiting electro fishing in
all Philippine waters. The order is quoted below: +.wph!1
SUBJECT: PROHIBITING ELECTRO FISHING IN ALL WATERS +.wph!1
OF THE PHILIPPINES.
Pursuant to Section 4 of Act No. 4003, as amended, and Section 4 of R.A. No. 3512, the following rules and
regulations regarding the prohibition of electro fishing in all waters of the Philippines are promulgated for the
information and guidance of all concerned.+.wph!1
SECTION 1. Definition. Words and terms used in this Order 11 construed as follows:
(a) Philippine waters or territorial waters of the Philippines' includes all waters of the Philippine
Archipelago, as defined in the t between the United States and Spain, dated respectively the tenth
of December, eighteen hundred ninety eight and the seventh of November, nineteen hundred. For
the purpose of this order, rivers, lakes and other bodies of fresh waters are included.
(b) Electro Fishing. Electro fishing is the catching of fish with the use of electric current. The
equipment used are of many electrical devices which may be battery or generator-operated and
from and available source of electric current.
(c) 'Persons' includes firm, corporation, association, agent or employee.
(d) 'Fish' includes other aquatic products.
SEC. 2. Prohibition. It shall be unlawful for any person to engage in electro fishing or to
catch fish by the use of electric current in any portion of the Philippine waters except for
research, educational and scientific purposes which must be covered by a permit issued by the
Secretary of Agriculture and Natural Resources which shall be carried at all times.
SEC. 3. Penalty. Any violation of the provisions of this Administrative Order shall subject
the offender to a fine of not exceeding five hundred pesos (P500.00) or imprisonment of not
extending six (6) months or both at the discretion of the Court.
SEC. 4. Repealing Provisions. All administrative orders or parts thereof inconsistent with
the provisions of this Administrative Order are hereby revoked.
SEC. 5. Effectivity. This Administrative Order shall take effect six (60) days after its
publication in the Office Gazette.
On June 28, 1967 the Secretary of Agriculture and Natural Resources, upon the recommendation of the
Fisheries Commission, issued Fisheries Administrative Order No. 84-1, amending section 2 of Administrative
Order No. 84, by restricting the ban against electro fishing to fresh water fisheries (63 O.G. 9963).

Thus, the phrase "in any portion of the Philippine waters" found in section 2, was changed by the amendatory
order to read as follows: "in fresh water fisheries in the Philippines, such as rivers, lakes, swamps, dams,
irrigation canals and other bodies of fresh water."
The Court of First Instance and the prosecution (p. 11 of brief) assumed that electro fishing is punishable under
section 83 of the Fisheries Law (not under section 76 thereof), which provides that any other violation of that
law "or of any rules and regulations promulgated thereunder shall subject the offender to a fine of not more than
two hundred pesos (P200), or in t for not more than six months, or both, in the discretion of the court."
That assumption is incorrect because 3 of the aforequoted Administrative Order No. 84 imposes a fm of not
exceeding P500 on a person engaged in electro fishing, which amount the 83. It seems that the Department of
Fisheries prescribed their own penalty for swift fishing which penalty is less than the severe penalty imposed in
section 76 and which is not Identified to the at penalty imposed in section 83.
Had Administrative Order No. 84 adopted the fighter penalty prescribed in on 83, then the crime of electro
fishing would be within the exclusive original jurisdiction of the inferior court (Sec. 44 [f], Judiciary Law;
People vs. Ragasi, L-28663, September 22,
We have discussed this pre point, not raised in the briefs, because it is obvious that the crime of electro fishing
which is punishable with a sum up to P500, falls within the concurrent original jurisdiction of the inferior
courts and the Court of First instance (People vs. Nazareno, L-40037, April 30, 1976, 70 SCRA 531 and the
cases cited therein).
And since the instant case was filed in the municipal court of Sta. Cruz, Laguna, a provincial capital, the order
of d rendered by that municipal court was directly appealable to the Court, not to the Court of First Instance of
Laguna (Sec. 45 and last par. of section 87 of the Judiciary Law; Esperat vs. Avila, L-25992, June 30, 1967, 20
SCRA 596).
It results that the Court of First Instance of Laguna had no appellate jurisdiction over the case. Its order
affirming the municipal court's order of dismissal is void for lack of motion. This appeal shall be treated as a
direct appeal from the municipal court to this Court. (See People vs. Del Rosario, 97 Phil. 67).
In this appeal, the prosecution argues that Administrative Orders Nos. 84 and 84-1 were not issued under
section 11 of the Fisheries Law which, as indicated above, punishes fishing by means of an obnoxious or
poisonous substance. This contention is not well-taken because, as already stated, the Penal provision of
Administrative Order No. 84 implies that electro fishing is penalized as a form of fishing by means of an
obnoxious or poisonous substance under section 11.
The prosecution cites as the legal sanctions for the prohibition against electro fishing in fresh water fisheries (1)
the rule-making power of the Department Secretary under section 4 of the Fisheries Law; (2) the function of the
Commissioner of Fisheries to enforce the provisions of the Fisheries Law and the regulations Promulgated
thereunder and to execute the rules and regulations consistent with the purpose for the creation of the Fisheries
Commission and for the development of fisheries (Sec. 4[c] and [h] Republic Act No. 3512; (3) the declared
national policy to encourage, Promote and conserve our fishing resources (Sec. 1, Republic Act No. 3512), and
(4) section 83 of the Fisheries Law which provides that "any other violation of" the Fisheries Law or of any
rules and regulations promulgated thereunder "shall subject the offender to a fine of not more than two hundred
pesos, or imprisonment for not more than six months, or both, in the discretion of the court."
As already pointed out above, the prosecution's reference to section 83 is out of place because the penalty for
electro fishing under Administrative order No. 84 is not the same as the penalty fixed in section 83.

We are of the opinion that the Secretary of Agriculture and Natural Resources and the Commissioner of
Fisheries exceeded their authority in issuing Fisheries Administrative Orders Nos. 84 and 84-1 and that those
orders are not warranted under the Fisheries Commission, Republic Act No. 3512.
The reason is that the Fisheries Law does not expressly prohibit electro fishing. As electro fishing is not banned
under that law, the Secretary of Agriculture and Natural Resources and the Commissioner of Fisheries are
powerless to penalize it. In other words, Administrative Orders Nos. 84 and 84-1, in penalizing electro fishing,
are devoid of any legal basis.
Had the lawmaking body intended to punish electro fishing, a penal provision to that effect could have been
easily embodied in the old Fisheries Law.
That law punishes (1) the use of obnoxious or poisonous substance, or explosive in fishing; (2) unlawful fishing
in deepsea fisheries; (3) unlawful taking of marine molusca, (4) illegal taking of sponges; (5) failure of licensed
fishermen to report the kind and quantity of fish caught, and (6) other violations.
Nowhere in that law is electro fishing specifically punished. Administrative Order No. 84, in punishing electro
fishing, does not contemplate that such an offense fails within the category of "other violations" because, as
already shown, the penalty for electro fishing is the penalty next lower to the penalty for fishing with the use of
obnoxious or poisonous substances, fixed in section 76, and is not the same as the penalty for "other violations"
of the law and regulations fixed in section 83 of the Fisheries Law.
The lawmaking body cannot delegate to an executive official the power to declare what acts should constitute
an offense. It can authorize the issuance of regulations and the imposition of the penalty provided for in the law
itself. (People vs. Exconde 101 Phil. 11 25, citing 11 Am. Jur. 965 on p. 11 32).
Originally, Administrative Order No. 84 punished electro fishing in all waters. Later, the ban against electro
fishing was confined to fresh water fisheries. The amendment created the impression that electro fishing is not
condemnable per se. It could be tolerated in marine waters. That circumstances strengthens the view that the old
law does not eschew all forms of electro fishing.
However, at present, there is no more doubt that electro fishing is punishable under the Fisheries Law and that it
cannot be penalized merely by executive revolution because Presidential Decree No. 704, which is a revision
and consolidation of all laws and decrees affecting fishing and fisheries and which was promulgated on May 16,
1975 (71 O.G. 4269), expressly punishes electro fishing in fresh water and salt water areas.
That decree provides: +.wph!1
SEC. 33. Illegal fishing, dealing in illegally caught fish or fishery/aquatic products. It shall
he unlawful for any person to catch, take or gather or cause to be caught, taken or gathered fish
or fishery/aquatic products in Philippine waters with the use of explosives, obnoxious or
poisonous substance, or by the use of electricity as defined in paragraphs (1), (m) and (d),
respectively, of Section 3 hereof: ...
The decree Act No. 4003, as amended, Republic Acts Nos. 428, 3048, 3512 and 3586, Presidential Decrees
Nos. 43, 534 and 553, and all , Acts, Executive Orders, rules and regulations or parts thereof inconsistent with it
(Sec. 49, P. D. No. 704).
The inclusion in that decree of provisions defining and penalizing electro fishing is a clear recognition of the
deficiency or silence on that point of the old Fisheries Law. It is an admission that a mere executive regulation
is not legally adequate to penalize electro fishing.

Note that the definition of electro fishing, which is found in section 1 (c) of Fisheries Administrative Order No.
84 and which is not provided for the old Fisheries Law, is now found in section 3(d) of the decree. Note further
that the decree penalty electro fishing by "imprisonment from two (2) to four (4) years", a punishment which is
more severe than the penalty of a time of not excluding P500 or imprisonment of not more than six months or
both fixed in section 3 of Fisheries Administrative Order No. 84.
An examination of the rule-making power of executive officials and administrative agencies and, in particular,
of the Secretary of Agriculture and Natural Resources (now Secretary of Natural Resources) under the Fisheries
Law sustains the view that he ex his authority in penalizing electro fishing by means of an administrative order.
Administrative agent are clothed with rule-making powers because the lawmaking body finds it impracticable,
if not impossible, to anticipate and provide for the multifarious and complex situations that may be encountered
in enforcing the law. All that is required is that the regulation should be germane to the defects and purposes of
the law and that it should conform to the standards that the law prescribes (People vs. Exconde 101 Phil. 1125;
Director of Forestry vs. Mu;oz, L-24796, June 28, 1968, 23 SCRA 1183, 1198; Geukeko vs. Araneta, 102 Phil.
706, 712).
The lawmaking body cannot possibly provide for all the details in the enforcement of a particular statute (U.S.
vs. Tupasi Molina, 29 Phil. 119, 125, citing U.S. vs. Grimaud 220 U.S. 506; Interprovincial Autobus Co., Inc.
vs. Coll. of Internal Revenue, 98 Phil. 290, 295-6).
The grant of the rule-making power to administrative agencies is a relaxation of the principle of separation of
powers and is an exception to the nondeleption of legislative, powers. Administrative regulations or
"subordinate legislation calculated to promote the public interest are necessary because of "the growing
complexity of modem life, the multiplication of the subjects of governmental regulations, and the increased
difficulty of administering the law" Calalang vs. Williams, 70 Phil. 726; People vs. Rosenthal and Osme;a, 68
Phil. 328).
Administrative regulations adopted under legislative authority by a particular department must be in harmony
with the provisions of the law, and should be for the sole purpose of carrying into effect its general provisions.
By such regulations, of course, the law itself cannot be extended. (U.S. vs. Tupasi Molina, supra). An
administrative agency cannot amend an act of Congress (Santos vs. Estenzo, 109 Phil. 419, 422; Teoxon vs.
Members of the d of Administrators, L-25619, June 30, 1970, 33 SCRA 585; Manuel vs. General Auditing
Office, L-28952, December 29, 1971, 42 SCRA 660; Deluao vs. Casteel, L-21906, August 29, 1969, 29 SCRA
350).
The rule-making power must be confined to details for regulating the mode or proceeding to carry into effect
the law as it his been enacted. The power cannot be extended to amending or expanding the statutory
requirements or to embrace matters not covered by the statute. Rules that subvert the statute cannot be
sanctioned. (University of Santo Tomas vs. Board of Tax A 93 Phil. 376, 382, citing 12 C.J. 845-46. As to
invalid regulations, see of Internal Revenue vs. Villaflor 69 Phil. 319, Wise & Co. vs. Meer, 78 Phil. 655, 676;
Del March vs. Phil. Veterans Administrative, L-27299, June 27, 1973, 51 SCRA 340, 349).
There is no question that the Secretary of Agriculture and Natural Resources has rule-making powers. Section 4
of the Fisheries law provides that the Secretary "shall from time to time issue instructions, orders, and
regulations consistent" with that law, "as may be and proper to carry into effect the provisions thereof." That
power is now vested in the Secretary of Natural Resources by on 7 of the Revised Fisheries law, Presidential
December No. 704.
Section 4(h) of Republic Act No. 3512 empower the Co of Fisheries "to prepare and execute upon the approval
of the Secretary of Agriculture and Natural Resources, forms instructions, rules and regulations consistent with
the purpose" of that enactment "and for the development of fisheries."

Section 79(B) of the Revised Administrative Code provides that "the Department Head shall have the power to
promulgate, whenever he may see fit do so, all rules, regulates, orders, memorandums, and other
instructions, not contrary to law, to regulate the proper working and harmonious and efficient administration of
each and all of the offices and dependencies of his Department, and for the strict enforcement and proper
execution of the laws relative to matters under the jurisdiction of said Department; but none of said rules or
orders shall prescribe penalties for the violation thereof, except as expressly authorized by law."
Administrative regulations issued by a Department Head in conformity with law have the force of law (Valerie
vs. Secretary of culture and Natural Resources, 117 Phil. 729, 733; Antique Sawmills, Inc. vs. Zayco, L- 20051,
May 30, 1966, 17 SCRA 316). As he exercises the rule-making power by delegation of the lawmaking body, it
is a requisite that he should not transcend the bound demarcated by the statute for the exercise of that power;
otherwise, he would be improperly exercising legislative power in his own right and not as a surrogate of the
lawmaking body.
Article 7 of the Civil Code embodies the basic principle that administrative or executive acts, orders and
regulations shall be valid only when they are not contrary to the laws or the Constitution."
As noted by Justice Fernando, "except for constitutional officials who can trace their competence to act to the
fundamental law itself, a public office must be in the statute relied upon a grant of power before he can exercise
it." "department zeal may not be permitted to outrun the authority conferred by statute." (Radio
Communications of the Philippines, Inc. vs. Santiago, L-29236, August 21, 1974, 58 SCRA 493, 496-8).
"Rules and regulations when promulgated in pursuance of the procedure or authority conferred upon the
administrative agency by law, partake of the nature of a statute, and compliance therewith may be enforced by a
penal sanction provided in the law. This is so because statutes are usually couched in general terms, after
expressing the policy, purposes, objectives, remedies and sanctions intended by the legislature. The details and
the manner of carrying out the law are oftentimes left to the administrative agency entrusted with its
enforcement. In this sense, it has been said that rules and regulations are the product of a delegated power to
create new or additional legal provisions that have the effect of law." The rule or regulation should be within the
scope of the statutory authority granted by the legislature to the administrative agency. (Davis, Administrative
Law, p. 194, 197, cited in Victories Milling Co., Inc. vs. Social Security Commission, 114 Phil. 555, 558).
In case of discrepancy between the basic law and a rule or regulation issued to implement said law, the basic
law prevails because said rule or regulation cannot go beyond the terms and provisions of the basic law (People
vs. Lim, 108 Phil. 1091).
This Court in its decision in the Lim case, supra, promulgated on July 26, 1960, called the attention of technical
men in the executive departments, who draft rules and regulations, to the importance and necessity of closely
following the legal provisions which they intend to implement so as to avoid any possible misunderstanding or
confusion.
The rule is that the violation of a regulation prescribed by an executive officer of the government in conformity
with and based upon a statute authorizing such regulation constitutes an offense and renders the offender liable
to punishment in accordance with the provisions of the law (U.S. vs. Tupasi Molina, 29 Phil. 119, 124).
In other words, a violation or infringement of a rule or regulation validly issued can constitute a crime
punishable as provided in the authorizing statute and by virtue of the latter (People vs. Exconde 101 Phil. 1125,
1132).
It has been held that "to declare what shall constitute a crime and how it shall be punished is a power vested
exclusively in the legislature, and it may not be delegated to any other body or agency" (1 Am. Jur. 2nd, sec.
127, p. 938; Texas Co. vs. Montgomery, 73 F. Supp. 527).

In the instant case the regulation penalizing electro fishing is not strictly in accordance with the Fisheries Law,
under which the regulation was issued, because the law itself does not expressly punish electro fishing.
The instant case is similar to People vs. Santos, 63 Phil. 300. The Santos case involves section 28 of Fish and
Game Administrative Order No. 2 issued by the Secretary of Agriculture and Natural Resources pursuant to the
aforementioned section 4 of the Fisheries Law.
Section 28 contains the proviso that a fishing boat not licensed under the Fisheries Law and under the said
administrative order may fish within three kilometers of the shoreline of islands and reservations over which
jurisdiction is exercised by naval and military reservations authorities of the United States only upon receiving
written permission therefor, which permission may be granted by the Secretary upon recommendation of the
military or naval authorities concerned. A violation of the proviso may be proceeded against under section 45 of
the Federal Penal Code.
Augusto A. Santos was prosecuted under that provision in the Court of First Instance of Cavite for having
caused his two fishing boats to fish, loiter and anchor without permission from the Secretary within three
kilometers from the shoreline of Corrigidor Island.
This Court held that the Fisheries Law does not prohibit boats not subject to license from fishing within three
kilometers of the shoreline of islands and reservations over which jurisdiction is exercised by naval and military
authorities of the United States, without permission from the Secretary of Agriculture and Natural Resources
upon recommendation of the military and naval authorities concerned.
As the said law does not penalize the act mentioned in section 28 of the administrative order, the promulgation
of that provision by the Secretary "is equivalent to legislating on the matter, a power which has not been and
cannot be delegated to him, it being expressly reserved" to the lawmaking body. "Such an act constitutes not
only an excess of the regulatory power conferred upon the Secretary but also an exercise of a legislative power
which he does not have, and therefore" the said provision "is null and void and without effect". Hence, the
charge against Santos was dismiss.
A penal statute is strictly construed. While an administrative agency has the right to make ranks and regulations
to carry into effect a law already enacted, that power should not be confused with the power to enact a criminal
statute. An administrative agency can have only the administrative or policing powers expressly or by necessary
implication conferred upon it. (Glustrom vs. State, 206 Ga. 734, 58 Second 2d 534; See 2 Am. Jr. 2nd 129-130).
Where the legislature has delegated to executive or administrative officers and boards authority to promulgate
rules to carry out an express legislative purpose, the rules of administrative officers and boards, which have the
effect of extending, or which conflict with the authority granting statute, do not represent a valid precise of the
rule-making power but constitute an attempt by an administrative body to legislate (State vs. Miles, Wash. 2nd
322, 105 Pac. 2nd 51).
In a prosecution for a violation of an administrative order, it must clearly appear that the order is one which falls
within the scope of the authority conferred upon the administrative body, and the order will be scrutinized with
special care. (State vs. Miles supra).
The Miles case involved a statute which authorized the State Game Commission "to adopt, promulgate, amend
and/or repeal, and enforce reasonable rules and regulations governing and/or prohibiting the taking of the
various classes of game.
Under that statute, the Game Commission promulgated a rule that "it shall be unlawful to offer, pay or receive
any reward, prize or compensation for the hunting, pursuing, taking, killing or displaying of any game animal,
game bird or game fish or any part thereof."

Beryl S. Miles, the owner of a sporting goods store, regularly offered a ten-down cash prize to the person
displaying the largest deer in his store during the open for hunting such game animals. For that act, he was
charged with a violation of the rule Promulgated by the State Game Commission.
It was held that there was no statute penalizing the display of game. What the statute penalized was the taking
of game. If the lawmaking body desired to prohibit the display of game, it could have readily said so. It was not
lawful for the administrative board to extend or modify the statute. Hence, the indictment against Miles was
quashed. The Miles case is similar to this case.
WHEREFORE, the lower court's decision of June 9, 1970 is set aside for lack of appellate jurisdiction and the
order of dismissal rendered by the municipal court of Sta. Cruz, Laguna in Criminal Case No. 5429 is affirmed.
Costs de oficio.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

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,
and supervision of pilots and the pilotage profession, 1 the PPA promulgated PPA-AO-03-85 2 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 aspiring pilots must be holders of pilot
licenses 3 and must train as probationary pilots in outports for three months and in the Port of Manila for four
months. It is only after they have achieved satisfactory performance 4 that they are given permanent and regular
appointments by the PPA itself 5 to exercise harbor pilotage until they reach the age of 70, unless sooner
removed by reason of mental or physical unfitness by the PPA General Manager. 6 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. Dayan issued PPA-AO No. 04-92 7 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 Memorandum Order No. 08-92 8 which laid down the criteria
or factors to be considered in the reappointment of harbor pilot, viz.: (1) Qualifying Factors: 9 safety record and
physical/mental medical exam report and (2) Criteria for Evaluation: 10 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
PPA-AO 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 order issued earlier. 11 He concluded that PPA-AO No.
04-92 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, 1993, the trial court rendered the following
judgment: 12

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 v. Carnation Philippines, Inc. 13 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 PPA-AO 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,
reasonable, and just." 14 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. 04-92 no less than four times 16 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'

examinations," was not consulted, 17 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 Philippine Coast Guard need not be consulted. 18
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 the requirements of notice and hearing. 19
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 due process." 20 He merely expressed the opinion the "(i)n the limited context of this case, PPA-AO 0492 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) in accordance with establishment standards." 21 A license is a right or permission granted
by some competent authority to carry on a business or do an act which, without such license, would be illegal. 22
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 that PPA-AO No. 04-92 is a
"surplusage" 23 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.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 119761 August 29, 1996

COMMISSIONER OF INTERNAL REVENUE, petitioner,
vs.
HON. COURT OF APPEALS, HON. COURT OF TAX APPEALS and FORTUNE TOBACCO
CORPORATION,respondents.

VITUG, J.:p
The Commissioner of Internal Revenue ("CIR") disputes the decision, dated 31 March 1995, of respondent
Court of Appeals 1 affirming the 10th August 1994 decision and the 11th October 1994 resolution of the Court
of Tax Appeals 2("CTA") in C.T.A. Case No. 5015, entitled "Fortune Tobacco Corporation vs. Liwayway
Vinzons-Chato in her capacity as Commissioner of Internal Revenue."
The facts, by and large, are not in dispute.
Fortune Tobacco Corporation ("Fortune Tobacco") is engaged in the manufacture of different brands of
cigarettes.
On various dates, the Philippine Patent Office issued to the corporation separate certificates of trademark
registration over "Champion," "Hope," and "More" cigarettes. In a letter, dated 06 January 1987, of then
Commissioner of Internal Revenue Bienvenido A. Tan, Jr., to Deputy Minister Ramon Diaz of the Presidential
Commission on Good Government, "the initial position of the Commission was to classify 'Champion,' 'Hope,'
and 'More' as foreign brands since they were listed in the World Tobacco Directory as belonging to foreign
companies. However, Fortune Tobacco changed the names of 'Hope' to 'Hope Luxury' and 'More' to
'Premium More,' thereby removing the said brands from the foreign brand category. Proof was also submitted to
the Bureau (of Internal Revenue ['BIR']) that 'Champion' was an original Fortune Tobacco Corporation register
and therefore a local brand." 3 Ad Valorem taxes were imposed on these brands, 4 at the following rates:
BRAND AD VALOREM TAX RATE
E.O. 22 and E.O. 273 RA 6956
06-23-86 07-25-87 06-18-90
07-01-86 01-01-88 07-05-90
Hope Luxury M. 100's
Sec. 142, (c), (2) 40% 45%
Hope Luxury M. King
Sec. 142, (c), (2) 40% 45%
More Premium M. 100's
Sec. 142, (c), (2) 40% 45%
More Premium International
Sec. 142, (c), (2) 40% 45%

Champion Int'l. M. 100's

Sec. 142, (c), (2) 40% 45%
Champion M. 100's
Sec. 142, (c), (2) 40% 45%
Champion M. King
Sec. 142, (c), last par. 15% 20%
Champion Lights
Sec. 142, (c), last par. 15% 20% 5
A bill, which later became Republic Act ("RA") No. 7654, 6 was enacted, on 10 June 1993, by the
legislature and signed into law, on 14 June 1993, by the President of the Philippines. The new law
became effective on 03 July 1993. It amended Section 142(c)(1) of the National Internal Revenue Code
("NIRC") to read; as follows:
Sec. 142. Cigars and Cigarettes.
xxx xxx xxx
(c) Cigarettes packed by machine. There shall be levied, assessed and collected on cigarettes
packed by machine a tax at the rates prescribed below based on the constructive manufacturer's
wholesale price or the actual manufacturer's wholesale price, whichever is higher:
(1) On locally manufactured cigarettes which are currently classified and taxed at fifty-five
percent (55%) or the exportation of which is not authorized by contract or otherwise, fifty-five
(55%) provided that the minimum tax shall not be less than Five Pesos (P5.00) per pack.
(2) On other locally manufactured cigarettes, forty-five percent (45%) provided that the
minimum tax shall not be less than Three Pesos (P3.00) per pack.
xxx xxx xxx
When the registered manufacturer's wholesale price or the actual manufacturer's wholesale price
whichever is higher of existing brands of cigarettes, including the amounts intended to cover the
taxes, of cigarettes packed in twenties does not exceed Four Pesos and eighty centavos (P4.80)
per pack, the rate shall be twenty percent (20%). 7 (Emphasis supplied)
About a month after the enactment and two (2) days before the effectivity of RA 7654, Revenue
Memorandum Circular No. 37-93 ("RMC 37-93"), was issued by the BIR the full text of which
expressed:
REPUBLIKA NG PILIPINAS
KAGAWARAN NG PANANALAPI
KAWANIHAN NG RENTAS INTERNAS
July 1, 1993
REVENUE MEMORANDUM CIRCULAR NO. 37-93
SUBJECT: Reclassification of Cigarettes Subject to Excise Tax
TO: All Internal Revenue Officers and Others Concerned.

In view of the issues raised on whether "HOPE," "MORE" and "CHAMPION" cigarettes which
are locally manufactured are appropriately considered as locally manufactured cigarettes bearing
a foreign brand, this Office is compelled to review the previous rulings on the matter.
Section 142 (c)(1) National Internal Revenue Code, as amended by R.A. No. 6956, provides:
On locally manufactured cigarettes bearing a foreign brand, fifty-five percent
(55%) Provided, That this rate shall apply regardless of whether or not the right to
use or title to the foreign brand was sold or transferred by its owner to the local
manufacturer. Whenever it has to be determined whether or not a cigarette bears a
foreign brand, the listing of brands manufactured in foreign countries appearing in
the current World Tobacco Directory shall govern.
Under the foregoing, the test for imposition of the 55% ad valorem tax on cigarettes is that the
locally manufactured cigarettes bear a foreign brand regardless of whether or not the right to use
or title to the foreign brand was sold or transferred by its owner to the local manufacturer. The
brand must be originally owned by a foreign manufacturer or producer. If ownership of the
cigarette brand is, however, not definitely determinable, ". . . the listing of brands manufactured
in foreign countries appearing in the current World Tobacco Directory shall govern. . . ."
"HOPE" is listed in the World Tobacco Directory as being manufactured by (a) Japan Tobacco,
Japan and (b) Fortune Tobacco, Philippines. "MORE" is listed in the said directory as being
manufactured by: (a) Fills de Julia Reig, Andorra; (b) Rothmans, Australia; (c) RJR-Macdonald
Canada; (d) Rettig-Strenberg, Finland; (e) Karellas, Greece; (f) R.J. Reynolds, Malaysia; (g)
Rothmans, New Zealand; (h) Fortune Tobacco, Philippines; (i) R.J. Reynolds, Puerto Rico; (j)
R.J. Reynolds, Spain; (k) Tabacalera, Spain; (l) R.J. Reynolds, Switzerland; and (m) R.J.
Reynolds, USA. "Champion" is registered in the said directory as being manufactured by (a)
Commonwealth Bangladesh; (b) Sudan, Brazil; (c) Japan Tobacco, Japan; (d) Fortune Tobacco,
Philippines; (e) Haggar, Sudan; and (f) Tabac Reunies, Switzerland.
Since there is no showing who among the above-listed manufacturers of the cigarettes bearing
the said brands are the real owner/s thereof, then it follows that the same shall be considered
foreign brand for purposes of determining the ad valorem tax pursuant to Section 142 of the
National Internal Revenue Code. As held in BIR Ruling No. 410-88, dated August 24, 1988, "in
cases where it cannot be established or there is dearth of evidence as to whether a brand is
foreign or not, resort to the World Tobacco Directory should be made."
In view of the foregoing, the aforesaid brands of cigarettes, viz: "HOPE," "MORE" and
"CHAMPION" being manufactured by Fortune Tobacco Corporation are hereby considered
locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on
cigarettes.
Any ruling inconsistent herewith is revoked or modified accordingly.
(SGD) LIWAYWAY VINZONS-CHATO
Commissioner
On 02 July 1993, at about 17:50 hours, BIR Deputy Commissioner Victor A. Deoferio, Jr., sent via
telefax a copy of RMC 37-93 to Fortune Tobacco but it was addressed to no one in particular. On 15
July 1993, Fortune Tobacco received, by ordinary mail, a certified xerox copy of RMC 37-93.

In a letter, dated 19 July 1993, addressed to the appellate division of the BIR, Fortune Tobacco
requested for a review, reconsideration and recall of RMC 37-93. The request was denied on 29 July
1993. The following day, or on 30 July 1993, the CIR assessed Fortune Tobacco for ad valorem tax
deficiency amounting to P9,598,334.00.
On 03 August 1993, Fortune Tobacco filed a petition for review with the CTA. 8
On 10 August 1994, the CTA upheld the position of Fortune Tobacco and adjudged:
WHEREFORE, Revenue Memorandum Circular No. 37-93 reclassifying the brands of
cigarettes, viz: "HOPE," "MORE" and "CHAMPION" being manufactured by Fortune Tobacco
Corporation as locally manufactured cigarettes bearing a foreign brand subject to the 55% ad
valorem tax on cigarettes is found to be defective, invalid and unenforceable, such that when
R.A. No. 7654 took effect on July 3, 1993, the brands in question were not CURRENTLY
CLASSIFIED AND TAXED at 55% pursuant to Section 1142(c)(1) of the Tax Code, as
amended by R.A. No. 7654 and were therefore still classified as other locally manufactured
cigarettes and taxed at 45% or 20% as the case may be.
Accordingly, the deficiency ad valorem tax assessment issued on petitioner Fortune Tobacco
Corporation in the amount of P9,598,334.00, exclusive of surcharge and interest, is hereby
canceled for lack of legal basis.
Respondent Commissioner of Internal Revenue is hereby enjoined from collecting the deficiency
tax assessment made and issued on petitioner in relation to the implementation of RMC No. 3793.
SO ORDERED. 9
In its resolution, dated 11 October 1994, the CTA dismissed for lack of merit the motion for
reconsideration.
The CIR forthwith filed a petition for review with the Court of Appeals, questioning the CTA's 10th
August 1994 decision and 11th October 1994 resolution. On 31 March 1993, the appellate court's
Special Thirteenth Division affirmed in all respects the assailed decision and resolution.
In the instant petition, the Solicitor General argues: That
I. RMC 37-93 IS A RULING OR OPINION OF THE COMMISSIONER OF
INTERNAL REVENUE INTERPRETING THE PROVISIONS OF THE TAX
CODE.
II. BEING AN INTERPRETATIVE RULING OR OPINION, THE
PUBLICATION OF RMC 37-93, FILING OF COPIES THEREOF WITH THE
UP LAW CENTER AND PRIOR HEARING ARE NOT NECESSARY TO ITS
VALIDITY, EFFECTIVITY AND ENFORCEABILITY.
III. PRIVATE RESPONDENT IS DEEMED TO HAVE BEEN NOTIFIED OR
RMC 37-93 ON JULY 2, 1993.

IV. RMC 37-93 IS NOT DISCRIMINATORY SINCE IT APPLIES TO ALL

LOCALLY MANUFACTURED CIGARETTES SIMILARLY SITUATED AS
"HOPE," "MORE" AND "CHAMPION" CIGARETTES.
V. PETITIONER WAS NOT LEGALLY PROSCRIBED FROM
RECLASSIFYING "HOPE," "MORE" AND "CHAMPION" CIGARETTES
BEFORE THE EFFECTIVITY OF R.A. NO. 7654.
VI. SINCE RMC 37-93 IS AN INTERPRETATIVE RULE, THE INQUIRY IS
NOT INTO ITS VALIDITY, EFFECTIVITY OR ENFORCEABILITY BUT
INTO ITS CORRECTNESS OR PROPRIETY; RMC 37-93 IS CORRECT. 10
In fine, petitioner opines that RMC 37-93 is merely an interpretative ruling of the BIR which can thus
become effective without any prior need for notice and hearing, nor publication, and that its issuance is
not discriminatory since it would apply under similar circumstances to all locally manufactured
cigarettes.
The Court must sustain both the appellate court and the tax court.
Petitioner stresses on the wide and ample authority of the BIR in the issuance of rulings for the effective
implementation of the provisions of the National Internal Revenue Code. Let it be made clear that such
authority of the Commissioner is not here doubted. Like any other government agency, however, the
CIR may not disregard legal requirements or applicable principles in the exercise of its quasi-legislative
powers.
Let us first distinguish between two kinds of administrative issuances a legislative rule and
aninterpretative rule.
In Misamis Oriental Association of Coco Traders, Inc., vs. Department of Finance Secretary, 11 the
Court expressed:
. . . a legislative rule is in the nature of subordinate legislation, designed to implement a primary
legislation by providing the details thereof . In the same way that laws must have the benefit of
public hearing, it is generally required that before a legislative rule is adopted there must be
hearing. In this connection, the Administrative Code of 1987 provides:
Public Participation. If not otherwise required by law, an agency shall, as far as practicable,
publish or circulate notices of proposed rules and afford interested parties the opportunity to
submit their views prior to the adoption of any rule.
(2) In the fixing of rates, no rule or final order shall be valid unless the proposed rates shall have
been published in a newspaper of general circulation at least two (2) weeks before the first
hearing thereon.
(3) In case of opposition, the rules on contested cases shall be observed.
In addition such rule must be published. On the other hand, interpretative rules are designed to
provide guidelines to the law which the administrative agency is in charge of enforcing. 12
It should be understandable that when an administrative rule is merely interpretative in nature, its
applicability needs nothing further than its bare issuance for it gives no real consequence more than what

the law itself has already prescribed. When, upon the other hand, the administrative rule goes beyond
merely providing for the means that can facilitate or render least cumbersome the implementation of the
law but substantially adds to or increases the burden of those governed, it behooves the agency to accord
at least to those directly affected a chance to be heard, and thereafter to be duly informed, before that
new issuance is given the force and effect of law.
A reading of RMC 37-93, particularly considering the circumstances under which it has been issued,
convinces us that the circular cannot be viewed simply as a corrective measure (revoking in the process
the previous holdings of past Commissioners) or merely as construing Section 142(c)(1) of the NIRC, as
amended, but has, in fact and most importantly, been made in order to place "Hope Luxury," "Premium
More" and "Champion" within the classification of locally manufactured cigarettes bearing foreign
brands and to thereby have them covered by RA 7654. Specifically, the new law would have its
amendatory provisions applied to locally manufactured cigarettes which at the time of its effectivity were
not so classified as bearing foreign brands. Prior to the issuance of the questioned circular, "Hope
Luxury," "Premium More," and "Champion" cigarettes were in the category of locally manufactured
cigarettes not bearing foreign brand subject to 45% ad valorem tax. Hence, without RMC 37-93, the
enactment of RA 7654, would have had no new tax rate consequence on private respondent's products.
Evidently, in order to place "Hope Luxury," "Premium More," and "Champion" cigarettes within the
scope of the amendatory law and subject them to an increased tax rate, the now disputed RMC 37-93
had to be issued. In so doing, the BIR not simply intrepreted the law; verily, it legislated under its quasilegislative authority. The due observance of the requirements of notice, of hearing, and of publication
should not have been then ignored.
Indeed, the BIR itself, in its RMC 10-86, has observed and provided:
RMC NO. 10-86
Effectivity of Internal Revenue Rules and Regulations
It has been observed that one of the problem areas bearing on compliance with Internal Revenue
Tax rules and regulations is lack or insufficiency of due notice to the tax paying public. Unless
there is due notice, due compliance therewith may not be reasonably expected. And most
importantly, their strict enforcement could possibly suffer from legal infirmity in the light of the
constitutional provision on "due process of law" and the essence of the Civil Code provision
concerning effectivity of laws, whereby due notice is a basic requirement (Sec. 1, Art. IV,
Constitution; Art. 2, New Civil Code).
In order that there shall be a just enforcement of rules and regulations, in conformity with the
basic element of due process, the following procedures are hereby prescribed for the drafting,
issuance and implementation of the said Revenue Tax Issuances:
(1) This Circular shall apply only to (a) Revenue Regulations; (b) Revenue Audit
Memorandum Orders; and (c) Revenue Memorandum Circulars and Revenue
Memorandum Orders bearing on internal revenue tax rules and regulations.
(2) Except when the law otherwise expressly provides, the aforesaid internal
revenue tax issuances shall not begin to be operative until after due notice thereof
may be fairly presumed.
Due notice of the said issuances may be fairly presumed only after the following
procedures have been taken;
xxx xxx xxx

(5) Strict compliance with the foregoing procedures is

enjoined. 13
Nothing on record could tell us that it was either impossible or impracticable for the BIR to observe and
comply with the above requirements before giving effect to its questioned circular.
Not insignificantly, RMC 37-93 might have likewise infringed on uniformity of taxation.
Article VI, Section 28, paragraph 1, of the 1987 Constitution mandates taxation to be uniform and
equitable. Uniformity requires that all subjects or objects of taxation, similarly situated, are to be treated
alike or put on equal footing both in privileges and liabilities. 14 Thus, all taxable articles or kinds of
property of the same class must be taxed at the same rate 15 and the tax must operate with the same force
and effect in every place where the subject may be found.
Apparently, RMC 37-93 would only apply to "Hope Luxury," "Premium More" and "Champion"
cigarettes and, unless petitioner would be willing to concede to the submission of private respondent that
the circular should, as in fact my esteemed colleague Mr. Justice Bellosillo so expresses in his separate
opinion, be considered adjudicatory in nature and thus violative of due process following the Ang
Tibay 16 doctrine, the measure suffers from lack of uniformity of taxation. In its decision, the CTA has
keenly noted that other cigarettes bearing foreign brands have not been similarly included within the
scope of the circular, such as
1. Locally manufactured by ALHAMBRA INDUSTRIES, INC.
(a) "PALM TREE" is listed as manufactured by office of Monopoly, Korea
(Exhibit "R")
2. Locally manufactured by LA SUERTE CIGAR and CIGARETTE COMPANY
(a) "GOLDEN KEY" is listed being manufactured by United Tobacco, Pakistan
(Exhibit "S")
(b) "CANNON" is listed as being manufactured by Alpha Tobacco, Bangladesh
(Exhibit "T")
3. Locally manufactured by LA PERLA INDUSTRIES, INC.
(a) "WHITE HORSE" is listed as being manufactured by Rothman's, Malaysia
(Exhibit "U")
(b) "RIGHT" is listed as being manufactured by SVENSKA, Tobaks, Sweden
(Exhibit "V-1")
4. Locally manufactured by MIGHTY CORPORATION
(a) "WHITE HORSE" is listed as being manufactured by Rothman's, Malaysia
(Exhibit "U-1")
5. Locally manufactured by STERLING TOBACCO CORPORATION

(a) "UNION" is listed as being manufactured by Sumatra Tobacco, Indonesia and

Brown and Williamson, USA (Exhibit "U-3")
(b) "WINNER" is listed as being manufactured by Alpha Tobacco, Bangladesh;
Nangyang, Hongkong; Joo Lan, Malaysia; Pakistan Tobacco Co., Pakistan;
Premier Tobacco, Pakistan and Haggar, Sudan (Exhibit "U-4"). 17
The court quoted at length from the transcript of the hearing conducted on 10 August 1993 by the
Committee on Ways and Means of the House of Representatives; viz:
THE CHAIRMAN. So you have specific information on Fortune Tobacco alone. You don't have
specific information on other tobacco manufacturers. Now, there are other brands which are
similarly situated. They are locally manufactured bearing foreign brands. And may I enumerate
to you all these brands, which are also listed in the World Tobacco Directory . . . Why were these
brand not reclassified at 55 if your want to give a level playing filed to foreign manufacturers?
MS. CHATO. Mr. Chairman, in fact, we have already prepared a Revenue Memorandum
Circular that was supposed to come after RMC No. 37-93 which have really named specifically
the list of locally manufactured cigarettes bearing a foreign brand for excise tax purposes and
includes all these brands that you mentioned at 55 percent except that at that time, when we had
to come up with this, we were forced to study the brands of Hope, More and Champion because
we were given documents that would indicate the that these brands were actually being claimed
or patented in other countries because we went by Revenue Memorandum Circular 1488 and we
wanted to give some rationality to how it came about but we couldn't find the rationale there.
And we really found based on our own interpretation that the only test that is given by that
existing law would be registration in the World Tobacco Directory. So we came out with this
proposed revenue memorandum circular which we forwarded to the Secretary of Finance except
that at that point in time, we went by the Republic Act 7654 in Section 1 which amended Section
142, C-1, it said, that on locally manufactured cigarettes which are currently classified and taxed
at 55 percent. So we were saying that when this law took effect in July 3 and if we are going to
come up with this revenue circular thereafter, then I think our action would really be subject to
question but we feel that . . . Memorandum Circular Number 37-93 would really cover even
similarly situated brands. And in fact, it was really because of the study, the short time that we
were given to study the matter that we could not include all the rest of the other brands that
would have been really classified as foreign brand if we went by the law itself. I am sure that by
the reading of the law, you would without that ruling by Commissioner Tan they would really
have been included in the definition or in the classification of foregoing brands. These brands
that you referred to or just read to us and in fact just for your information, we really came out
with a proposed revenue memorandum circular for those brands. (Emphasis supplied)
(Exhibit "FF-2-C," pp. V-5 TO V-6, VI-1 to VI-3).
xxx xxx xxx
MS. CHATO. . . . But I do agree with you now that it cannot and in fact that is why I felt that we
. . . I wanted to come up with a more extensive coverage and precisely why I asked that revenue
memorandum circular that would cover all those similarly situated would be prepared but
because of the lack of time and I came out with a study of RA 7654, it would not have been
possible to really come up with the reclassification or the proper classification of all brands that
are listed there. . .(emphasis supplied) (Exhibit "FF-2d," page IX-1)
xxx xxx xxx

HON. DIAZ. But did you not consider that there are similarly situated?
MS. CHATO. That is precisely why, Sir, after we have come up with this Revenue
Memorandum Circular No. 37-93, the other brands came about the would have also clarified
RMC 37-93 by I was saying really because of the fact that I was just recently appointed and the
lack of time, the period that was allotted to us to come up with the right actions on the matter, we
were really caught by the July 3 deadline. But in fact, We have already prepared a revenue
memorandum circular clarifying with the other . . . does not yet, would have been a list of locally
manufactured cigarettes bearing a foreign brand for excise tax purposes which would include all
the other brands that were mentioned by the Honorable Chairman. (Emphasis supplied) (Exhibit
"FF-2-d," par. IX-4). 18
All taken, the Court is convinced that the hastily promulgated RMC 37-93 has fallen short of a valid and
effective administrative issuance.
WHEREFORE, the decision of the Court of Appeals, sustaining that of the Court of Tax Appeals, is
AFFIRMED. No costs.
SO ORDERED.
Kapunan, J., concurs.

Separate Opinions

BELLOSILLO, J.: separate opinion:

RA 7654 was enacted by Congress on 10 June 1993, signed into law by the President on 14 June 1993, and took
effect 3 July 1993. It amended partly Sec. 142, par. (c), of the National Internal Revenue Code (NIRC) to read

Sec. 142. Cigars and cigarettes. . . . . (c) Cigarettes packed by machine. There shall be
levied, assessed and collected on cigarettes packed by machine a tax at the rates prescribed
below based on the constructive manufacturer's wholesale price or the actual manufacturer's
wholesale price, whichever is higher.
(1) On locally manufactured cigarettes which are currently classified and taxed at fifty-five
percent (55%) or the exportation of which is not authorized by contract or otherwise, fifty-five
percent (55%) provided that the minimum tax shall not be less than Five Pesos (P5.00) per pack
(emphasis supplied).
(2) On other locally manufactured cigarettes, forty-five percent (45%) provided that the
minimum tax shall not be less than Three Pesos (P3.00) per pack.
Prior to the effectivity of RA 7654, cigarette brands Hope Luxury, Premium More and Champion were
considered local brands subjected to an ad valorem tax at the rate of 20-45%. However, on 1 July 1993 or two
(2) days before RA 7654 took effect, petitioner Commissioner of Internal Revenue issued RMC 37-93
reclassifying "Hope, Moreand Champion being manufactured by Fortune Tobacco Corporation . . . . (as) locally

manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on cigarettes." 1 RMC 37-93
in effect subjected Hope Luxury, Premium More and Champion cigarettes to the provisions of Sec. 142, par. (c),
subpar. (1), NIRC, as amended by RA 7654, imposing upon these cigarette brands an ad valorem tax of "fiftyfive percent (55%) provided that the minimum tax shall not be less than Five Pesos (P5.00) per pack."
On 2 July 1993, Friday, at about five-fifty in the afternoon, or a few hours before the effectivity of RA 7654, a
copy of RMC 37-93 with a cover letter signed by Deputy Commissioner Victor A. Deoferio of the Bureau of
Internal Revenue was sent by facsimile to the factory of respondent corporation in Parang, Marikina, Metro
Manila. It appears that the letter together with a copy of RMC 37-93 did not immediately come to the
knowledge of private respondent as it was addressed to no one in particular. It was only when the
reclassification of respondent corporation's cigarette brands was reported in the column of Fil C. Sionil
in Business Bulletin on 4 July 1993 that the president of respondent corporation learned of the matter,
prompting him to inquire into its veracity and to request from petitioner a copy of RMC 37-93. On 15 July 1993
respondent corporation received by ordinary mail a certified machine copy of RMC 37-93.
Respondent corporation sought a review, reconsideration and recall of RMC 37-93 but was forthwith denied by
the Appellate Division of the Bureau of Internal Revenue. As a consequence, on 30 July 1993 private
respondent was assessed an ad valorem tax deficiency amounting to P9,598,334.00. Respondent corporation
went to the Court of Tax Appeals (CTA) on a petition for review.
On 10 August 1994, after due hearing, the CTA found the petition meritorious and ruled
Revenue Memorandum Circular No. 37-93 reclassifying the brands of
cigarettes, viz: Hope, More andChampion being manufactured by Fortune Tobacco Corporation
as locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on
cigarettes is found to be defective, invalid and unenforceable . . . . Accordingly, the deficiency ad
valorem tax assessment issued on petitioner Fortune Tobacco Corporation in the amount of
P9,598,334.00, exclusive of surcharge and interest, is hereby cancelled for lack of legal basis. 2
The CTA held that petitioner Commissioner of Internal Revenue failed to observe due process of law in
issuing RMC 37-93 as there was no prior notice and hearing, and that RMC 37-93 was in itself
discriminatory. The motion to reconsider its decision was denied by the CTA for lack of merit. On 31
March 1995 respondent Court of Appeals affirmed in toto the decision of the CTA. 3 Hence, the instant
petition for review.
Petitioner now submits through the Solicitor General that RMC 37-93 reclassifying Hope Luxury, Premium
Moreand Champion as locally manufactured cigarettes bearing brands is merely an interpretative ruling which
needs no prior notice and hearing as held in Misamis Oriental Association of Coco Traders, Inc. v. Department
of Finance Secretary. 4 It maintains that neither is the assailed revenue memorandum circular discriminatory as
it merely "lays down the test in determining whether or not a locally manufactured cigarette bears a foreign
brand using (only) the cigarette brandsHope, More and Champion as specific examples." 5
Respondent corporation on the other hand contends that RMC 37-93 is not a mere interpretative ruling but is
adjudicatory in nature where prior notice and hearing are mandatory, and that Misamis Oriental Association of
Coco Traders, Inc. v. Department of Finance Secretary on which the Solicitor General relies heavily is not
applicable. Respondent Fortune Tobacco Corporation also argues that RMC 37-93 discriminates against its
cigarette brands since those of its competitors which are similarly situated have not been reclassified.
The main issues before us are (a) whether RMC 37-93 is merely an interpretative rule the issuance of which
needs no prior notice and hearing, or an adjudicatory ruling which calls for the twin requirements of prior notice
and hearing, and, (b) whether RMC 37-93 is discriminatory in nature.

A brief discourse on the powers and functions of administrative bodies may be instructive.
Administrative agencies posses quasi-legislative or rule making powers and quasi-judicial or administrative
adjudicatory powers. Quasi-legislative or rule making power is the power to make rules and regulations which
results in delegated legislation that is within the confines of the granting statute and the doctrine of
nondelegability and separability of powers.
Interpretative rule, one of the three (3) types of quasi-legislative or rule making powers of an administrative
agency (the other two being supplementary or detailed legislation, and contingent legislation), is promulgated
by the administrative agency to interpret, clarify or explain statutory regulations under which the administrative
body operates. The purpose or objective of an interpretative rule is merely to construe the statute being
administered. It purports to do no more than interpret the statute. Simply, the rule tries to say what the statute
means. Generally, it refers to no single person or party in particular but concerns all those belonging to the same
class which may be covered by the said interpretative rule. It need not be published and neither is a hearing
required since it is issued by the administrative body as an incident of its power to enforce the law and is
intended merely to clarify statutory provisions for proper observance by the people. In Taada v. Tuvera, 6 this
Court expressly said that "[i]interpretative regulations . . . . need not be published."
Quasi-judicial or administrative adjudicatory power on the other hand is the power of the administrative agency
to adjudicate the rights of persons before it. It is the power to hear and determine questions of fact to which the
legislative policy is to apply and to decide in accordance with the standards laid down by the law itself in
enforcing and administering the same law. 7 The administrative body exercises its quasi-judicial power when it
performs in a judicial manner an act which is essentially of an executive or administrative nature, where the
power to act in such manner is incidental to or reasonably necessary for the performance of the executive or
administrative duty entrusted to it. 8 In carrying out their quasi-judicial functions the administrative officers or
bodies are required to investigate facts or ascertain the existence of facts, hold hearings, weigh evidence, and
draw conclusions from them as basis for their official action and exercise of discretion in a judicial nature.
Since rights of specific persons are affected it is elementary that in the proper exercise of quasi-judicial power
due process must be observed in the conduct of the proceedings.
The importance of due process cannot be underestimated. Too basic is the rule that no person shall be deprived
of life, liberty or property without due process of law. Thus when an administrative proceeding is quasi-judicial
in character, notice and fair open hearing are essential to the validity of the proceeding. The right to reasonable
prior notice and hearing embraces not only the right to present evidence but also the opportunity to know the
claims of the opposing party and to meet them. The right to submit arguments implies that opportunity
otherwise the right may as well be considered impotent. And those who are brought into contest with
government in a quasi-judicial proceeding aimed at the control of their activities are entitled to be fairy advised
of what the government proposes and to be heard upon its proposal before it issues its final command.
There are cardinal primary rights which must be respected in administrative proceedings. The landmark case
ofAng Tibay v. The Court of Industrial Relations 9 enumerated these rights: (1) 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; (2) the tribunal must consider the evidence presented; (3) the decision must have something to support
itself; (4) the evidence must be substantial; (5) 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; (6) the tribunal or any of its
judges 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; and, (7) the tribunal should in all
controversial questions render its decision in such manner that the parties to the proceeding may know the
various issues involved and the reasons for the decision rendered.
In determining whether RMC No. 37-93 is merely an interpretative rule which requires no prior notice and
hearing, or an adjudicatory rule which demands the observance of due process, a close examination of RMC 37-

93 is in order. Noticeably, petitioner Commissioner of Internal Revenue at first interprets Sec. 142, par. (c),
subpar. (1), of the NIRC, as amended, by citing the law and clarifying or explaining what it means
Section 142 (c) (1), National Internal Revenue Code, as amended by R.A. No. 6956, provides:
On locally manufactured cigarettes bearing a foreign brand, fifty-five percent (55%) Provided,
That this rate shall apply regardless of whether or not the right to use or title to the foreign brand
was sold or transferred by its owner to the local manufacturer. Whenever it has to be determined
whether or not a cigarette bears a foreign brand, the listing of brands manufactured in foreign
countries appearing in the current World Tobacco Directory shall govern.
Under the foregoing, the test for imposition of the 55% ad valorem tax on cigarettes is that the
locally manufactured cigarettes bear a foreign brand regardless of whether or not the right to use
or title to the foreign brand was sold or transferred by its owner to the local manufacturer. The
brand must be originally owned by a foreign manufacturer or producer. If ownership of the
cigarette brand is, however, not definitely determinable,
". . . the listing of brands manufactured in foreign countries appearing in the current World
Tobacco Directory shall govern . . ."
Then petitioner makes a factual finding by declaring that Hope (Luxury), (Premium) More and Champion are
manufactured by other foreign manufacturers
Hope is listed in the World Tobacco Directory as being manufactured by (a) Japan Tobacco,
Japan and (b) Fortune Tobacco, Philippines. More is listed in the said directory as being
manufactured by: (a) Fills de Julia Reig, Andorra; (b) Rothmans, Australia; (c) RJR-MacDonald,
Canada; (d) Rettig-Strenberg, Finland; (e) Karellas, Greece; (f) R.J. Reynolds, Malaysia; (g)
Rothmans, New Zealand; (h) Fortune Tobacco, Philippines; (i) R.J. Reynolds, Puerto Rico; (j)
R.J. Reynolds, Spain; (k) Tabacalera, Spain; (l) R.J. Reynolds, Switzerland; and (m) R.J.
Reynolds, USA. "Champion" is registered in the said directory as being manufactured by: (a)
Commonwealth Bangladesh; (b) Sudan, Brazil; (c) Japan Tobacco, Japan; (d) Fortune Tobacco,
Philippines; (e) Haggar, Sudan; and (f) Tabac Reunies, Switzerland.
From this finding, petitioner thereafter formulates an inference that since it cannot be determined who among
the manufacturers are the real owners of the brands in question, then these cigarette brands should be considered
foreign brands
Since there is no showing who among the above-listed manufacturers of the cigarettes bearing
the said brands are the real owner/s thereof, then it follows that the same shall be considered
foreign brand for purposes of determining the ad valorem tax pursuant to Section 142 of the
National Internal Revenue Code. As held in BIR Ruling No. 410-88, dated August 24, 1988, "in
cases where it cannot be established or there is dearth of evidence as to whether a brand is
foreign or not, resort to the World Tobacco Directory should be made."
Finally, petitioner caps RMC 37-93 with a disposition specifically directed at respondent corporation
reclassifying its cigarette brands as locally manufactured bearing foreign brands
In view of the foregoing, the aforesaid brands of cigarettes, viz: Hope, More and Champion being
manufactured by Fortune Tobacco Corporation are hereby considered locally manufactured
cigarettes bearing a foreign brand subject to the 55% ad valorem tax on cigarettes.
Any ruling inconsistent herewith is revoked or modified accordingly.

It is evident from the foregoing that in issuing RMC 37-93 petitioner Commissioner of Internal Revenue was
exercising her quasi-judicial or administrative adjudicatory power. She cited and interpreted the law, made a
factual finding, applied the law to her given set of facts, arrived at a conclusion, and issued a ruling aimed at a
specific individual. Consequently prior notice and hearing are required. It must be emphasized that even the text
alone of RMC 37-93 implies that reception of evidence during a hearing is appropriate if not necessary since it
invokes BIR Ruling No. 410-88, dated August 24, 1988, which provides that "in cases where it cannot be
established or there is dearth of evidence as to whether a brand is foreign or not . . . ." Indeed, it is difficult to
determine whether a brand is foreign or not if it is not established by, or there is dearth of, evidence because no
hearing has been called and conducted for the reception of such evidence. In fine, by no stretch of the
imagination can RMC 37-93 be considered purely as an interpretative rule requiring no previous notice and
hearing and simply interpreting, construing, clarifying or explaining statutory regulations being administered by
or under which the Bureau of Internal Revenue operates.
It is true that both RMC 47-91 in Misamis Oriental Association of Coco Traders v. Department of Finance
Secretary, and RMC 37-93 in the instant case reclassify certain products for purposes of taxation. But the
similarity between the two revenue memorandum circulars ends there. For in properly determining whether a
revenue memorandum circular is merely an interpretative rule or an adjudicatory rule, its very tenor and text,
and the circumstances surrounding its issuance will have no to be considered.
We quote RMC 47-91 promulgated 11 June 1991
Revenue Memorandum Circular No. 47-91
SUBJECT : Taxability of Copra
TO : All Revenue Officials and Employees and Others Concerned.
For the information and guidance of all officials and employees and others concerned, quoted
hereunder in its entirety is VAT Ruling No. 190-90 dated August 17, 1990:
COCOFED MARKETING RESEARCH CORPORATION
6th Floor Cocofed Building
144 Amorsolo Street
Legaspi Village, Makati
Metro Manila
Attention: Ms. Esmyrna E. Reyes
Vice President Finance
Sirs:
This has reference to your letter dated January 16, 1990 wherein you represented
that inspite of your VAT registration of your copra trading company, you are
supposed to be exempt from VAT on the basis of BIR Ruling dated January 8,
1988 which considered copra as an agricultural food product in its original state.
In this connection, you request for a confirmation of your opinion as aforestated.
In reply, please be informed that copra, being an agricultural non-food product, is
exempt from VAT only if sale is made by the primary producer pursuant to
Section 103 (a) of the Tax Code, as amended. Thus as a trading company and a
subsequent seller, your sale of copra is already subject to VAT pursuant to
Section 9(b) (1) of Revenue Regulations 5-27.

This revokes VAT Ruling Nos. 009-88 and 279-88.

Very truly yours,
(Sgd.)
JOSE
U.
ONG
Commissioner of Internal Revenue
As a clarification, this is the present and official stand of this Office unless sooner revoked or
amended. All revenue officials and employees are enjoined to give this Circular as wide a
publicity as possible.
(Sgd.)
JOSE
U.
ONG
Commissioner of Internal Revenue
Quite obviously, the very text of RMC 47-91 itself shows that it is merely an interpretative rule as it simply
quotes a VAT Ruling and reminds those concerned that the ruling is the present and official stand of the Bureau
of Internal Revenue. Unlike in RMC 37-93 where petitioner Commissioner manifestly exercised her quasijudicial or administrative adjudicatory power, in RMC 47-91 there were no factual findings, no application of
laws to a given set of facts, no conclusions of law, and no dispositive portion directed at any particular party.
Another difference is that in the instant case, the issuance of the assailed revenue memorandum circular
operated to subject the taxpayer to the new law which was yet to take effect, while in Misamis, the disputed
revenue memorandum circular was issued simply to restate and then clarify the prevailing position and ruling of
the administrative agency, and no new law yet to take effect was involved. It merely interpreted an existing law
which had already been in effect for some time and which was not set to be amended. RMC 37-93 is thus
prejudicial to private respondent alone.
A third difference, and this likewise resolves the issue of discrimination, is that RMC 37-93 was ostensibly
issued to subject the cigarette brands of respondent corporation to a new law as it was promulgated two days
before the expiration of the old law and a few hours before the effectivity of the new law. That RMC 37-93 is
particularly aimed only at respondent corporation and its three (3) cigarette brands can be seen from the
dispositive portion of the assailed revenue memorandum circular
In view of the foregoing, the aforesaid brands of cigarettes, viz: Hope, More,
and Champion being manufactured by Fortune Tobacco Corporation are hereby considered
locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on
cigarettes.
Any ruling inconsistent herewith is revoked or modified accordingly.
Thus the argument of the Solicitor General that RMC 37-93 is not discriminatory as "[i]t merely lays down the
test in determining whether or not a locally manufactured cigarette bears a foreign brand using the cigarette
brandsHope, More and Champion as specific examples," cannot be accepted, much less sustained. Without
doubt, RMC 37-93 has a tremendous effect on respondent corporation and solely on respondent corporation
as its deficiency ad valorem tax assessment on its removals of Hope, Luxury, Premium More,
and Champion cigarettes for six (6) hours alone, i.e., from six o'clock in the evening of 2 July 1993 which is
presumably the time respondent corporation was supposed to have received the facsimile message sent by
Deputy Commissioner Victor A. Deoferio, until twelve o'clock midnight upon the effectivity of the new law,
was already P9,598,334.00. On the other hand, RMC 47-91 was issued with no purpose except to state and
declare what has been the official stand of the administrative agency on the specific subject matter, and was
indiscriminately directed to all copra traders with no particular individual in mind.

That petitioner Commissioner of Internal Revenue is an expert in her filed is not attempted to be disputed;
hence, we do not question the wisdom of her act in reclassifying the cigarettes. Neither do we deny her the
exercise of her quasi-legislative or quasi-judicial powers. But most certainly, by constitutional mandate, the
Court must check the exercise of these powers and ascertain whether petitioner has gone beyond the legitimate
bounds of her authority.
In the final analysis, the issue before us in not the expertise, the authority to promulgate rules, or the wisdom of
petitioner as Commissioner of Internal Revenue is reclassifying the cigarettes of private respondents. It is
simply the faithful observance by government by government of the basic constitutional right of a taxpayer to
due process of law and equal protection of the laws. This is what distresses me no end the manner and the
circumstances under which the cigarettes of private respondent were reclassified and correspondingly taxed
under RMC 37-93, and adjudicatory rule which therefore requires reasonable notice and hearing before its
issuance. It should not be confused with RMC 47-91, which is a mere interpretative rule.
In the earlier case of G.R. No. 119322, which practically involved the same opposing interests, I also voted to
uphold the constitutional right of the taxpayer concerned to due process and equal protection of the laws. By a
vote of 3-2, that view prevailed. In sequela, we in the First Division who constituted the majority found
ourselves unjustly drawn into the vortex of a nightmarish episode. The strong ripples whipped up by my opinion
expressed therein and of the majority have yet to varnish when we are again in the imbroglio of a similar
dilemma. The unpleasant experience should be reason enough to simply steer clear of this controversy and surf
on a pretendedloss of judicial objectivity. Such would have been an easy way out, a gracious exit, so to speak,
albeit lame. But to camouflage my leave with a sham excuse would be to turn away from a professional vow I
keep at all times; I would not be true to myself, and to the people I am committed to serve. Thus, as I have
earlier expressed, if placed under similar circumstances in some future time, I shall have to brave again the
prospect of another vilification and a tarnished image if only to show proudly to the whole world that under the
present dispensation judicial independence in our country is a true component of our democracy.
In fine, I am greatly perturbed by the manner RMC No. 37-93 was issued as well as the effect of such issuance.
For it cannot be denied that the circumstances clearly demonstrate that it was hastily issued without prior
notice and hearing, and singling out private respondent alone when two days before a new tax law was to
take effect petitioner reclassified and taxed the cigarette brands of private respondent at a higher rate.
Obviously, this was to make it appear that even before the anticipated date of effectivity of the statute which
was undeniably priorly known to petitioner these brands were already currently classified and taxed at fiftyfive percent (55%), thus shoving them into the purview of the law that was to take effect two days after!
For sure, private respondent was not properly informed before the issuance of the questioned memorandum
circular that its cigarette brands Hope Luxury, Premium More and Champion were being reclassified and
subjected to a higher tax rate. Naturally, the result would be to lose financially because private respondent was
still selling its cigarettes at a price based on the old, lower tax rate. Had there been previous notice and hearing,
as claimed by private respondent, it could have very well presented its side, either by opposing the
reclassification, or by acquiescing thereto but increasing the price of its cigarettes to adjust to the higher tax
rate. The reclassification and the ensuing imposition of a tax rate increase therefore could not be anything but
confiscatory if we are also to consider the claim of private respondent that the new tax is even higher than the
cost of its cigarettes.
Accordingly, I vote to deny the petition.

HERMOSISIMA, JR., J.: dissenting

Private respondent Fortune Tobacco Corporation in the instant case disputes its liability for deficiency ad
valoremexcise taxes on its removals of "Hope," "More," and "Champion" cigarettes from 6:00 p.m. to 12:00
midnight of July 2, 1993, in the total amount of P9,598,334.00. It claims that the circular, upon which the
assessment was based and made, is defective, invalid and unenforceable for having been issued without notice
and hearing and in violation of the equal protection clause guaranteed by the Constitution.
The majority upholds these claims of private respondent, convinced that the Circular in question, in the first
place, did not give prior notice and hearing, and so, it could not have been valid and effective. It proceeds to
affirm the factual findings of the Court of Tax Appeals, which findings were considered correct by respondent
Court of Appeals, to the effect that the petitioner Commissioner of Internal Revenue had indeed blatantly failed
to comply with the said twin requirements of notice and hearing, thereby rendering the issuance of the
questioned Circular to be in violation of the due process clause of the Constitution. It is also its dominant
opinion that the questioned Circular discriminates against private respondent Fortune Tobacco Corporation
insofar as it seems to affect only its "Hope," "More," and "Champion" cigarettes, to the exclusion of other
cigarettes apparently of the same kind or classification as these cigarettes manufactured by private respondent.
With all due respect, I disagree with the majority in its disquisition of the issues and its resulting conclusions.
Section 245 of the National Internal Revenue Code,
as amended, empowers the Commissioner of Internal
Revenue to issue the questioned Circular
Section 245 of the National Internal Revenue Code, as amended, provides:
Sec. 245. Authority of Secretary of Finance to promulgate rules and regulations. The
Secretary of Finance, upon recommendation of the Commissioner, shall promulgate all needful
rules and regulations for the effective enforcement of the provisions of this Code . . . without
prejudice to the power of the Commissioner of Internal Revenue to make rulings or opinions in
connection with the implementation of the provisions of internal revenue laws, including rulings
on the classification of articles for sales tax and similar purposes.
The subject of the questioned Circular is the reclassification of cigarettes subject to excise taxes. It was issued
in connection with Section 142 (c) (1) of the National Internal Revenue Code, as amended, which imposes ad
valorem excise taxes on locally manufactured cigarettes bearing a foreign brand. The same provision prescribes
the ultimate criterion that determines which cigarettes are to be considered "locally manufactured cigarettes
bearing a foreign brand." It provides:
. . . Whenever it has to be determined whether or not a cigarette bears a foreign brand, the listing
of brands manufactured in foreign countries appearing in the current World Tobacco Directory
shall govern.
There is only one World Tobacco Directory for a given current year, and the same is mandated by law to
be the BIR Commissioner's controlling basis for determining whether or not a particular locally
manufactured cigarette is one bearing a foreign brand. In so making a determination, petitioner should
inquire into the entries in the World Tobacco Directory for the given current year and shall be held
bound by such entries therein. She is not required to subject the results of her inquiries to feedback from
the concerned cigarette manufacturers, and it is doubtlessly not desirable nor managerially sound to
court dispute thereon when the law does not, in the first place, require debate or hearing thereon.
Petitioner may make such a determination because she is the Chief Executive Officer of the
administrative agency that is the Bureau of Internal Revenue in which are vested quasi-legislative
powers entrusted to it by the legislature in recognition of its more encompassing and unequalled
expertise in the field of taxation.

The vesture of quasi-legislative and quasi-judicial powers in administrative bodies is not

unconstitutional, unreasonable and oppressive. It has been necessitated by "the growing
complexity of the modern society" (Solid Homes, Inc. vs. Payawal, 177 SCRA 72, 79). More and
more administrative bodies are necessary to help in the regulation of society's ramified activities.
"Specialized in the particular field assigned to them, they can deal with the problems thereof
with more expertise and dispatch than can be expected from the legislature or the courts of
justice" . . . 1
Statutorily empowered to issue rulings or opinions embodying the proper determination in respect to classifying
articles, including cigarettes, for purposes of tax assessment and collection, petitioner was acting well within her
prerogatives when she issued the questioned Circular. And in the exercise of such prerogatives under the law,
she has in her favor the presumption of regular performance of official duty which must be overcome by clearly
persuasive evidence of stark error and grave abuse of discretion in order to be overturned and disregarded.
It is irrelevant that the Court of Tax Appeals makes much of the effect of the passing of Republic Act No.
7654 2 on petitioner's power to classify cigarettes. Although the decisions assailed and sought to be reviewed, as
well as the pleadings of private respondent, are replete with alleged admissions of our legislators to the effect
that the said Act was intended to freeze the current classification of cigarettes and make the same an integral
part of the said Act, certainly the repeal, if any, of petitioner's power to classify cigarettes must be reckoned
from the effectivity of the said Act and not before. Suffice it to say that indisputable is the plain fact that the
questioned Circular was issued on July 1, 1993, while the said Act took effect on July 3, 1993.
The contents of the questioned circular have not
been proven to be erroneous or illegal as to render
issuance thereof an act of grave abuse of
discretion on the part of petitioner Commissioner
Prior to the effectivity of R.A. No. 7654, Section 142 (c) (1) of the National Internal Revenue Code, as
amended, levies the following ad valorem taxes on cigarettes in accordance with their predetermined
classifications as established by the Commissioner of Internal Revenue:
. . . based on the manufacturer's registered wholesale price:
(1) On locally manufactured cigarettes bearing a foreign brand, fifty-five percent (55%)
Provided, That this rate shall apply regardless of whether or not the right to use or title to the
foreign brand was sold or transferred by its owner to the local manufacturer. Whenever it has to
be determined whether or not a cigarette bears a foreign brand, the listing of brands
manufactured in foreign countries appearing in the current World Tobacco Directory shall
govern.
(2) Other locally manufactured cigarettes, forty five percent (45%).
xxx xxx xxx
Prior to the issuance of the questioned Circular, assessed against and paid by private respondent as ad
valoremexcise taxes on their removals of "Hope," "More," and "Champion" cigarettes were amounts based on
paragraph (2) above, i.e., the tax rate made applicable on the said cigarettes was 45% at the most. The reason
for this is that apparently, petitioner's predecessors have all made determinations to the effect that the said
cigarettes were to be considered "other locally manufactured cigarettes" and not "locally manufactured
cigarettes bearing a foreign brand." Even petitioner, until her issuance of the questioned Circular, adhered to her
predecessors' determination as to the proper classification of the above-mentioned cigarettes for purposes of ad
valorem excise taxes. Apparently, the past determination that the said cigarettes were to be classified as "other

locally manufactured cigarettes" was based on private respodnent's convenient move of changing the names of
"Hope" to "Hope Luxury" and "More" to "Premium More." It also submitted proof that "Champion" was an
original Fortune Tobacco Corporation register and, therefore, a local brand. Having registered these brands with
the Philippine Patent Office and with corresponding evidence to the effect, private respondent paid ad
valorem excise taxes computed at the rate of not more than 45% which is the rate applicable to cigarettes
considered as locally manufactured brands.
How these past determinations pervaded notwithstanding their erroneous basis is only tempered by their innate
quality of being merely errors in interpretative ruling, the formulation of which does not bind the government.
Advantage over such errors may precipitously be withdrawn from those who have been benefiting from them
once the same have been discovered and rectified.
Petitioner correctly emphasizes that:
. . . the registration of said brands in the name of private respondent is proof only that it is the
exclusive owner thereof in the Philippines; it does not necessarily follow, however, that it is the
exclusive owner thereof in the whole world. Assuming arguendo that private respondent is the
exclusive owner of said brands in the Philippines, it does not mean that they are local. Otherwise,
they would not have been listed in the WTD as international brands manufactured by different
entities in different countries. Moreover, it cannot be said that the brands registered in the names
of private respondent are not the same brands listed in the WTD because private respondent is
one of the manufacturers of said brands listed in the WTD. 3
Private respondent attempts to cast doubt on the determination made by petitioner in the questioned Circular
that Japan is a manufacturer of "Hope" cigarettes. Private respondent's own inquiry into the World Tobacco
Directory reveals that Japan is not a manufacturer of "Hope" cigarettes. In pointing this out, private respondent
concludes that the entire Circular is erroneous and makes such error the principal proof of its claim that the
nature of the determination embodied in the questioned Circular requires a hearing on the facts and a debate on
the applicable law. Such a determination is adjudicatory in nature and, therefore, requires notice and hearing.
Private respondent is, however, apparently only eager to show error on the part of petitioner for acting with
grave abuse of discretion. Private respondent conveniently forgets that petitioner, equipped with the expertise in
taxation, recognized in that expertise by the legislature that vested in her the power to make rules respecting
classification of articles for taxation purposes, and presumed to have regularly exercised her prerogatives within
the scope of her statutory power to issue determinations specifically under Section 142 (c) (1) in relation to
Section 245 of the National Internal Revenue Code, as amended, simply followed the law as she understood it.
Her task was to determine which cigarette brands were foreign, and she was directed by the law to look into the
World Tobacco Directory. Foreign cigarette brands were legislated to be taxed at higher rates because of their
more extensive public exposure and international reputation; their competitive edge against local brands may
easily be checked by imposition of higher tax rates. Private respondent makes a mountain of the mole hill
circumstance that "Hope" is listed, not as being "manufactured" by Japan but as being "used" by Japan. Whether
manufactured or used by Japan, however, "Hope" remains a cigarette brand that can not be said to be limited to
local manufacture in the Philippines. The undeniable fact is that it is a foreign brand the sales in the Philippines
of which are greatly boosted by its international exposure and reputation. The petitioner was well within her
prerogatives, in the exercise of her rule-making power, to classify articles for taxation purposes, to interpret the
laws which she is mandated to administer. In interpreting the same, petitioner must, in general, be guided by the
principles underlying taxation, i.e., taxes are the lifeblood of Government, and revenue laws ought to be
interpreted in favor of the Government, for Government can not survive without the funds to underwrite its
varied operational expenses in pursuit of the welfare of the society which it serves and protects.
Private respondent claims that its business will be destroyed by the imposition of additional ad valorem taxes as
a result of the effectivity of the questioned Circular. It claims that under the vested rights theory, it cannot now
be made to pay higher taxes after having been assessed for less in the past. Of course private respondent will

trumpet its losses, its interests, after all, being its sole concern. What private respondent fails to see is the loss of
revenue by the Government which, because of erroneous determinations made by its past revenue
commissioners, collected lesser taxes than what it was entitled to in the first place. It is every citizen's duty to
pay the correct amount of taxes. Private respondent will not be shielded by any vested rights, for there are not
vested rights to speak of respecting a wrong construction of the law by administrative officials, and such wrong
interpretation does not place the Government in estoppel to correct or overrule the same. 4
The Questioned Circular embodies an interpretative
ruling of petitioner Commissioner which as such does
not require notice and hearing
As one of the public offices of the Government, the Bureau of Internal Revenue, through its Commissioner, has
grown to be a typical administrative agency vested with a fusion of different governmental powers: the power to
investigate, initiate action and control the range of investigation, the power to promulgate rules and regulations
to better carry out statutory policies, and the power to adjudicate controversies within the scope of their
activities. 5 In the realm of administrative law, we understand that such an empowerment of administrative
agencies was evolved in response to the needs of a changing society. This development arose as the need for
broad social control over complex conditions and activities became more and more pressing, and such
complexity could no longer be dealt with effectivity and directly by the legislature or the judiciary. The theory
which underlies the empowerment of administrative agencies like the Bureau of Internal Revenue, is that the
issues with which such agencies deal ought to be decided by experts, and not be a judge, at least not in the first
instance or until the facts have been sifted and arranged. 6
One of the powers of administrative agencies like the Bureau of Internal Revenue, is the power to make rules.
The necessity for vesting administrative agencies with this power stems from the impracticability of the
lawmakers providing general regulations for various and varying details pertinent to a particular legislation. 7
The rules that administrative agencies may promulgate may either be legislative or interpretative. The former is
a form of subordinate legislation whereby the administrative agency is acting in a legislative capacity,
supplementing the statute, filling in the details, pursuant to a specific delegation of legislative power. 8
Interpretative rules, on the other hand, are "those which purport to do no more than interpret the statute being
administered, to say what it means." 9
There can be no doubt that there is a distinction between an administrative rule or regulation and
an administrative interpretation of a law whose enforcement is entrusted to an administrative
body. When an administrative agency promulgates rules and regulations, it "makes" a new law
with the force and effect of a valid law, while when it renders an opinion or gives a statement of
policy, it merely interprets a pre-existing law (Parker, Administrative Law, p. 197; Davis
Administrative Law, p. 194). Rules and regulations when promulgated in pursuance of the
procedure or authority conferred upon the administrative agency by law, partake of the nature of
a statute, and compliance therewith may be enforced by a penal sanction provided in the law.
This is so because statutes are usually couched in general terms, after expressing the policy,
purposes, objectives, remedies and sanctions intended by the legislature. The details and the
manner of carrying out the law are often times left to the administrative agency entrusted with its
enforcement. In this sense, it has been said that rules and regulations are the product of a
delegated power to create new or additional legal provisions that have the effect of law.
(Davis, op. cit. p. 194.)
A rule is binding on the courts as long as the procedure fixed for its promulgation is followed
and its scope is within the statutory authority granted by the legislature, even if the courts are not
in agreement with the policy stated therein or its innate wisdom (Davis, op. cit. pp. 195-197). On

the other hand, administrative interpretation of the law is at best merely advisory, for it is the
courts that finally determine what the law means. 10
"Whether a given statutory delegation authorizes legislative or interpretative regulations depends upon whether
the statute places specific 'sanctions' behind the regulations authorized, as for example, by making it a criminal
offense to disobey them, or by making conformity with their provisions a condition of the exercise of legal
privileges." 11 This is because interpretative regulations are by nature simply statutory interpretations, which
have behind them no statutory sanction. Such regulations, whether so expressly authorized by statute or issued
only as an incident of statutory administration, merely embody administrative findings of law which are always
subject to judicial determination as to whether they are erroneous or not, even when their issuance is authorized
by statute.
The questioned Circular has undisputedly been issued by petitioner in pursuance of her rule-making powers
under Section 245 of the National Internal Revenue Code, as amended. Exercising such powers, petitioner reclassified "Hope," "More" and "Champion" cigarettes as locally manufactured cigarettes bearing foreign brands.
The re-classification, as previously explained, is the correct interpretation of Section 142 (c) (1) of the said
Code. The said legal provision is not accompanied by any penal sanction, and no detail had to be filled in by
petitioner. The basis for the classification of cigarettes has been provided for by the legislature, and all
petitioner has to do, on behalf of the government agency she heads, is to proceed to make the proper
determination using the criterion stipulated by the lawmaking body. In making the proper determination,
petitioner gave it a liberal construction consistent with the rule that revenue laws are to be construed in favor of
the Government whose survival depends on the contributions that taxpayers give to the public coffers that
finance public services and other governmental operations.
The Bureau of Internal Revenue which petitioner heads, is the government agency charged with the
enforcement of the laws pertinent to this case and so, the opinion of the Commissioner of Internal Revenue, in
the absence of a clear showing that it is plainly wrong, is entitled to great weight. Private respondent claims that
its rights under previous interpretations of Section 142 (c) (1) may not abruptly be cut by a new interpretation of
the said section, but precisely the said section is subject to various and changing construction, and hence, any
ruling issued by petitioner thereon is necessarily interpretative and not legislative. Private respondent insists that
the questioned circular is adjudicatory in nature because it determined the rights of private respondent in a
controversy involving his tax liability. It also asseverates that the questioned circular involved administrative
action that is particular and immediate, thereby rendering it subject to the requirements of notice and hearing in
compliance with the due process clause of the Constitution.
We find private respondent's arguments to be rather strained.
Petitioner made a determination as to the classification of cigarettes as mandated by the aforecited provisions in
the National Internal Revenue Code, as amended. Such determination was an interpretation by petitioner of the
said legal provisions. If in the course of making the interpretation and embodying the same in the questioned
circular which the petitioner subsequently issued after making such a determination, private respondent's
cigarettes products, by their very nature of being foreign brands as evidenced by their enlistment in the World
Tobacco Directory, which is the controlling basis for the proper classification of cigarettes as stipulated by the
law itself, have come to be classified as locally manufactured cigarettes bearing foreign brands and as such
subject to a tax rate higher than what was previously imposed thereupon based on past rulings of other revenue
commissioners, such a situation is simply a consequence of the performance by petitioner of here duties under
the law. No adjudication took place, much less was there any controversy ripe for adjudication. The natural
consequences of making a classification in accordance with law may not be used by private respondent in
arguing that the questioned circular is in fact adjudicatory in nature. Such an exercise in driving home a point is
illogical as it is fallacious and misplaced.

Private respondent concedes that under general rules of administrative law, "a ruling which is merely
'interpretative' in character may not require prior notice to affected parties before its issuance as well as a
hearing" and "for this reason, in most instances, interpretative regulations are not given the force of
law." 12Indeed, "interpretative regulations and those merely internal in nature
. . . need not be published." 13 And it is now settled that only legislative regulations and not interpretative
rulings must have the benefit of public
hearing. 14
Because (1) the questioned circular merely embodied an interpretation or a way of reading and giving meaning
to Section 142 (c) (1) of the National Internal Revenue Code, as amended; (2) petitioner did not fill in any
details in the aforecited section but only classified cigarettes on the basis of the World Tobacco Directory in the
light of the paramount principle of construing revenue laws in favor of the Government to the end that
Government collects as much tax money as it is entitled to in order to fulfill its public purposes for the general
good of its citizens; (3) no penal sanction is provided in the aforecited section that was construed by petitioner
in the questioned circular; and (4) a similar circular declassifying copra from being an agricultural food to nonfood product for purposes of the value added tax laws, resulting in the revocation of an exemption previously
enjoyed by copra traders, has been ruled by us to be merely an interpretative ruling and not a legislative, much
less, an adjudicatory, action on the part of the revenue commissioner, 15 this Court must not be blind to the fact
that the questioned Circular is indeed an interpretative ruling not subject to notice and hearing.
Neither is the questioned Circular tainted by a
violation of the equal protection clause under the
Constitution
Private respondent anchors its claim of violation of its equal protection rights upon the too obvious fact that
only its cigarette brands, i.e., "Hope," "More" and "Champion," are mentioned in the questioned circular.
Because only the cigarettes that they manufacture are enumerated in the questioned circular, private respondent
proceeded to attack the same as being discriminatory against it. On the surface, private respondent seems to
have a point there. A scrutiny of the questioned Circular, however, will show that it is undisputedly one of
general application for all cigarettes that are similarly situated as private respondent's brands. The new
interpretation of Section 142 (1) (c) has been well illustrated in its application upon private respondent's brands,
which illustration is properly a subject of the questioned Circular. Significantly, indicated as the subject of the
questioned circular is the "reclassification of cigarettes subject to excise taxes." The reclassification resulted in
the foregrounding of private respondent's cigarette brands, which incidentally is largely due to the controversy
spawned no less by private respondent's own action of conveniently changing its brand names to avoid falling
under a classification that would subject it to higher ad valorem tax rates. This caused then Commissioner
Bienvenido Tan to depart from his initial determination that private respondent's cigarette brands are foreign
brands. The consequent specific mention of such brands in the questioned Circular, does not change the fact that
the questioned Circular has always been intended for and did cover, all cigarettes similarly situated as "Hope,"
"More" and "Champion." Petitioner is thus correct in stating that:
. . . RMC 37-93 is not discriminatory. It lays down the test in determining whether or not a
locally manufactured cigarette bears a foreign brand using the cigarette brands "Hope," More and
"Champion" as specific examples. Such test applies to all locally manufactured cigarette brands
similarly situated as the cigarette brands aforementioned. While it is true that only "Hope,"
"More" and "Champion" cigarettes are actually determined as locally manufactured cigarettes
bearing a foreign brand, RMC 37-93 does not state that ONLY cigarettes fall under such
classification to the exclusion of other cigarettes similarly situated. Otherwise stated, RMC 37-93
does not exclude the coverage of other cigarettes similarly situated. Otherwise stated, RMC 3793 does not exclude the coverage of other cigarettes similarly situated as locally manufactured
cigarettes bearing a foreign brand. Hence, in itself, RMC 37-93 is not discriminatory. 16

Both the respondent Court of Appeals and the Court of Tax Appeals held that the questioned Circular
reclassifying "Hope," "More" and "Champion" cigarettes, is defective, invalid and unenforceable and has
rendered the assessment against private respondent of deficiency ad valorem excise taxes to be without legal
basis. The majority agrees with private respondent and respondent Courts. As the foregoing opinion chronicles
the fatal flaws in private respondent's arguments, it becomes more apparent that the questioned Circular is in
fact a valid and subsisting interpretative ruling that the petitioner had power to promulgate and enforce.
WHEREFORE, I vote to grant the petition and set aside the decisions of the Court of Tax Appeals and the
Court of Appeals, respectively, and to reinstate the decision of petitioner Commissioner of Internal Revenue
denying private respondent's request for a review, reconsideration and recall of Revenue Memorandum Circular
No. 37-93 dated July 1, 1993.
Padilla, J., concurs.

Separate Opinions

BELLOSILLO, J.: separate opinion:

RA 7654 was enacted by Congress on 10 June 1993, signed into law by the President on 14 June 1993, and took
effect 3 July 1993. It amended partly Sec. 142, par. (c), of the National Internal Revenue Code (NIRC) to read

Sec. 142. Cigars and cigarettes. . . . . (c) Cigarettes packed by machine. There shall be
levied, assessed and collected on cigarettes packed by machine a tax at the rates prescribed
below based on the constructive manufacturer's wholesale price or the actual manufacturer's
wholesale price, whichever is higher.
(1) On locally manufactured cigarettes which are currently classified and taxed at fifty-five
percent (55%) or the exportation of which is not authorized by contract or otherwise, fifty-five
percent (55%) provided that the minimum tax shall not be less than Five Pesos (P5.00) per pack
(emphasis supplied).
(2) On other locally manufactured cigarettes, forty-five percent (45%) provided that the
minimum tax shall not be less than Three Pesos (P3.00) per pack.
Prior to the effectivity of RA 7654, cigarette brands Hope Luxury, Premium More and Champion were
considered local brands subjected to an ad valorem tax at the rate of 20-45%. However, on 1 July 1993 or two
(2) days before RA 7654 took effect, petitioner Commissioner of Internal Revenue issued RMC 37-93
reclassifying "Hope, Moreand Champion being manufactured by Fortune Tobacco Corporation . . . . (as) locally
manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on cigarettes." 1 RMC 37-93
in effect subjected Hope Luxury, Premium More and Champion cigarettes to the provisions of Sec. 142, par. (c),
subpar. (1), NIRC, as amended by RA 7654, imposing upon these cigarette brands an ad valorem tax of "fiftyfive percent (55%) provided that the minimum tax shall not be less than Five Pesos (P5.00) per pack."
On 2 July 1993, Friday, at about five-fifty in the afternoon, or a few hours before the effectivity of RA 7654, a
copy of RMC 37-93 with a cover letter signed by Deputy Commissioner Victor A. Deoferio of the Bureau of
Internal Revenue was sent by facsimile to the factory of respondent corporation in Parang, Marikina, Metro
Manila. It appears that the letter together with a copy of RMC 37-93 did not immediately come to the

knowledge of private respondent as it was addressed to no one in particular. It was only when the
reclassification of respondent corporation's cigarette brands was reported in the column of Fil C. Sionil
in Business Bulletin on 4 July 1993 that the president of respondent corporation learned of the matter,
prompting him to inquire into its veracity and to request from petitioner a copy of RMC 37-93. On 15 July 1993
respondent corporation received by ordinary mail a certified machine copy of RMC 37-93.
Respondent corporation sought a review, reconsideration and recall of RMC 37-93 but was forthwith denied by
the Appellate Division of the Bureau of Internal Revenue. As a consequence, on 30 July 1993 private
respondent was assessed an ad valorem tax deficiency amounting to P9,598,334.00. Respondent corporation
went to the Court of Tax Appeals (CTA) on a petition for review.
On 10 August 1994, after due hearing, the CTA found the petition meritorious and ruled
Revenue Memorandum Circular No. 37-93 reclassifying the brands of
cigarettes, viz: Hope, More andChampion being manufactured by Fortune Tobacco Corporation
as locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on
cigarettes is found to be defective, invalid and unenforceable . . . . Accordingly, the deficiency ad
valorem tax assessment issued on petitioner Fortune Tobacco Corporation in the amount of
P9,598,334.00, exclusive of surcharge and interest, is hereby cancelled for lack of legal basis. 2
The CTA held that petitioner Commissioner of Internal Revenue failed to observe due process of law in
issuing RMC 37-93 as there was no prior notice and hearing, and that RMC 37-93 was in itself
discriminatory. The motion to reconsider its decision was denied by the CTA for lack of merit. On 31
March 1995 respondent Court of Appeals affirmed in toto the decision of the CTA. 3 Hence, the instant
petition for review.
Petitioner now submits through the Solicitor General that RMC 37-93 reclassifying Hope Luxury, Premium
Moreand Champion as locally manufactured cigarettes bearing brands is merely an interpretative ruling which
needs no prior notice and hearing as held in Misamis Oriental Association of Coco Traders, Inc. v. Department
of Finance Secretary. 4 It maintains that neither is the assailed revenue memorandum circular discriminatory as
it merely "lays down the test in determining whether or not a locally manufactured cigarette bears a foreign
brand using (only) the cigarette brandsHope, More and Champion as specific examples." 5
Respondent corporation on the other hand contends that RMC 37-93 is not a mere interpretative ruling but is
adjudicatory in nature where prior notice and hearing are mandatory, and that Misamis Oriental Association of
Coco Traders, Inc. v. Department of Finance Secretary on which the Solicitor General relies heavily is not
applicable. Respondent Fortune Tobacco Corporation also argues that RMC 37-93 discriminates against its
cigarette brands since those of its competitors which are similarly situated have not been reclassified.
The main issues before us are (a) whether RMC 37-93 is merely an interpretative rule the issuance of which
needs no prior notice and hearing, or an adjudicatory ruling which calls for the twin requirements of prior notice
and hearing, and, (b) whether RMC 37-93 is discriminatory in nature.
A brief discourse on the powers and functions of administrative bodies may be instructive.
Administrative agencies posses quasi-legislative or rule making powers and quasi-judicial or administrative
adjudicatory powers. Quasi-legislative or rule making power is the power to make rules and regulations which
results in delegated legislation that is within the confines of the granting statute and the doctrine of
nondelegability and separability of powers.
Interpretative rule, one of the three (3) types of quasi-legislative or rule making powers of an administrative
agency (the other two being supplementary or detailed legislation, and contingent legislation), is promulgated

by the administrative agency to interpret, clarify or explain statutory regulations under which the administrative
body operates. The purpose or objective of an interpretative rule is merely to construe the statute being
administered. It purports to do no more than interpret the statute. Simply, the rule tries to say what the statute
means. Generally, it refers to no single person or party in particular but concerns all those belonging to the same
class which may be covered by the said interpretative rule. It need not be published and neither is a hearing
required since it is issued by the administrative body as an incident of its power to enforce the law and is
intended merely to clarify statutory provisions for proper observance by the people. In Taada v. Tuvera, 6 this
Court expressly said that "[i]interpretative regulations . . . . need not be published."
Quasi-judicial or administrative adjudicatory power on the other hand is the power of the administrative agency
to adjudicate the rights of persons before it. It is the power to hear and determine questions of fact to which the
legislative policy is to apply and to decide in accordance with the standards laid down by the law itself in
enforcing and administering the same law. 7 The administrative body exercises its quasi-judicial power when it
performs in a judicial manner an act which is essentially of an executive or administrative nature, where the
power to act in such manner is incidental to or reasonably necessary for the performance of the executive or
administrative duty entrusted to it. 8 In carrying out their quasi-judicial functions the administrative officers or
bodies are required to investigate facts or ascertain the existence of facts, hold hearings, weigh evidence, and
draw conclusions from them as basis for their official action and exercise of discretion in a judicial nature.
Since rights of specific persons are affected it is elementary that in the proper exercise of quasi-judicial power
due process must be observed in the conduct of the proceedings.
The importance of due process cannot be underestimated. Too basic is the rule that no person shall be deprived
of life, liberty or property without due process of law. Thus when an administrative proceeding is quasi-judicial
in character, notice and fair open hearing are essential to the validity of the proceeding. The right to reasonable
prior notice and hearing embraces not only the right to present evidence but also the opportunity to know the
claims of the opposing party and to meet them. The right to submit arguments implies that opportunity
otherwise the right may as well be considered impotent. And those who are brought into contest with
government in a quasi-judicial proceeding aimed at the control of their activities are entitled to be fairy advised
of what the government proposes and to be heard upon its proposal before it issues its final command.
There are cardinal primary rights which must be respected in administrative proceedings. The landmark case
ofAng Tibay v. The Court of Industrial Relations 9 enumerated these rights: (1) 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; (2) the tribunal must consider the evidence presented; (3) the decision must have something to support
itself; (4) the evidence must be substantial; (5) 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; (6) the tribunal or any of its
judges 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; and, (7) the tribunal should in all
controversial questions render its decision in such manner that the parties to the proceeding may know the
various issues involved and the reasons for the decision rendered.
In determining whether RMC No. 37-93 is merely an interpretative rule which requires no prior notice and
hearing, or an adjudicatory rule which demands the observance of due process, a close examination of RMC 3793 is in order. Noticeably, petitioner Commissioner of Internal Revenue at first interprets Sec. 142, par. (c),
subpar. (1), of the NIRC, as amended, by citing the law and clarifying or explaining what it means
Section 142 (c) (1), National Internal Revenue Code, as amended by R.A. No. 6956, provides:
On locally manufactured cigarettes bearing a foreign brand, fifty-five percent (55%) Provided,
That this rate shall apply regardless of whether or not the right to use or title to the foreign brand
was sold or transferred by its owner to the local manufacturer. Whenever it has to be determined
whether or not a cigarette bears a foreign brand, the listing of brands manufactured in foreign
countries appearing in the current World Tobacco Directory shall govern.

Under the foregoing, the test for imposition of the 55% ad valorem tax on cigarettes is that the
locally manufactured cigarettes bear a foreign brand regardless of whether or not the right to use
or title to the foreign brand was sold or transferred by its owner to the local manufacturer. The
brand must be originally owned by a foreign manufacturer or producer. If ownership of the
cigarette brand is, however, not definitely determinable,
". . . the listing of brands manufactured in foreign countries appearing in the current World
Tobacco Directory shall govern . . ."
Then petitioner makes a factual finding by declaring that Hope (Luxury), (Premium) More and Champion are
manufactured by other foreign manufacturers
Hope is listed in the World Tobacco Directory as being manufactured by (a) Japan Tobacco,
Japan and (b) Fortune Tobacco, Philippines. More is listed in the said directory as being
manufactured by: (a) Fills de Julia Reig, Andorra; (b) Rothmans, Australia; (c) RJR-MacDonald,
Canada; (d) Rettig-Strenberg, Finland; (e) Karellas, Greece; (f) R.J. Reynolds, Malaysia; (g)
Rothmans, New Zealand; (h) Fortune Tobacco, Philippines; (i) R.J. Reynolds, Puerto Rico; (j)
R.J. Reynolds, Spain; (k) Tabacalera, Spain; (l) R.J. Reynolds, Switzerland; and (m) R.J.
Reynolds, USA. "Champion" is registered in the said directory as being manufactured by: (a)
Commonwealth Bangladesh; (b) Sudan, Brazil; (c) Japan Tobacco, Japan; (d) Fortune Tobacco,
Philippines; (e) Haggar, Sudan; and (f) Tabac Reunies, Switzerland.
From this finding, petitioner thereafter formulates an inference that since it cannot be determined who among
the manufacturers are the real owners of the brands in question, then these cigarette brands should be considered
foreign brands
Since there is no showing who among the above-listed manufacturers of the cigarettes bearing
the said brands are the real owner/s thereof, then it follows that the same shall be considered
foreign brand for purposes of determining the ad valorem tax pursuant to Section 142 of the
National Internal Revenue Code. As held in BIR Ruling No. 410-88, dated August 24, 1988, "in
cases where it cannot be established or there is dearth of evidence as to whether a brand is
foreign or not, resort to the World Tobacco Directory should be made."
Finally, petitioner caps RMC 37-93 with a disposition specifically directed at respondent corporation
reclassifying its cigarette brands as locally manufactured bearing foreign brands
In view of the foregoing, the aforesaid brands of cigarettes, viz: Hope, More and Champion being
manufactured by Fortune Tobacco Corporation are hereby considered locally manufactured
cigarettes bearing a foreign brand subject to the 55% ad valorem tax on cigarettes.
Any ruling inconsistent herewith is revoked or modified accordingly.
It is evident from the foregoing that in issuing RMC 37-93 petitioner Commissioner of Internal Revenue was
exercising her quasi-judicial or administrative adjudicatory power. She cited and interpreted the law, made a
factual finding, applied the law to her given set of facts, arrived at a conclusion, and issued a ruling aimed at a
specific individual. Consequently prior notice and hearing are required. It must be emphasized that even the text
alone of RMC 37-93 implies that reception of evidence during a hearing is appropriate if not necessary since it
invokes BIR Ruling No. 410-88, dated August 24, 1988, which provides that "in cases where it cannot be
established or there is dearth of evidence as to whether a brand is foreign or not . . . ." Indeed, it is difficult to
determine whether a brand is foreign or not if it is not established by, or there is dearth of, evidence because no
hearing has been called and conducted for the reception of such evidence. In fine, by no stretch of the
imagination can RMC 37-93 be considered purely as an interpretative rule requiring no previous notice and

hearing and simply interpreting, construing, clarifying or explaining statutory regulations being administered by
or under which the Bureau of Internal Revenue operates.
It is true that both RMC 47-91 in Misamis Oriental Association of Coco Traders v. Department of Finance
Secretary, and RMC 37-93 in the instant case reclassify certain products for purposes of taxation. But the
similarity between the two revenue memorandum circulars ends there. For in properly determining whether a
revenue memorandum circular is merely an interpretative rule or an adjudicatory rule, its very tenor and text,
and the circumstances surrounding its issuance will have no to be considered.
We quote RMC 47-91 promulgated 11 June 1991
Revenue Memorandum Circular No. 47-91
SUBJECT : Taxability of Copra
TO : All Revenue Officials and Employees and Others Concerned.
For the information and guidance of all officials and employees and others concerned, quoted
hereunder in its entirety is VAT Ruling No. 190-90 dated August 17, 1990:
COCOFED MARKETING RESEARCH CORPORATION
6th Floor Cocofed Building
144 Amorsolo Street
Legaspi Village, Makati
Metro Manila
Attention: Ms. Esmyrna E. Reyes
Vice President Finance
Sirs:
This has reference to your letter dated January 16, 1990 wherein you represented
that inspite of your VAT registration of your copra trading company, you are
supposed to be exempt from VAT on the basis of BIR Ruling dated January 8,
1988 which considered copra as an agricultural food product in its original state.
In this connection, you request for a confirmation of your opinion as aforestated.
In reply, please be informed that copra, being an agricultural non-food product, is
exempt from VAT only if sale is made by the primary producer pursuant to
Section 103 (a) of the Tax Code, as amended. Thus as a trading company and a
subsequent seller, your sale of copra is already subject to VAT pursuant to
Section 9(b) (1) of Revenue Regulations 5-27.
This revokes VAT Ruling Nos. 009-88 and 279-88.
Very truly yours,
(Sgd.) JOSE U. ONG
Commissioner of
Internal Revenue

As a clarification, this is the present and official stand of this Office unless sooner revoked or
amended. All revenue officials and employees are enjoined to give this Circular as wide a
publicity as possible.
(Sgd.) JOSE U. ONG
Commissioner of
Internal Revenue
Quite obviously, the very text of RMC 47-91 itself shows that it is merely an interpretative rule as it simply
quotes a VAT Ruling and reminds those concerned that the ruling is the present and official stand of the Bureau
of Internal Revenue. Unlike in RMC 37-93 where petitioner Commissioner manifestly exercised her quasijudicial or administrative adjudicatory power, in RMC 47-91 there were no factual findings, no application of
laws to a given set of facts, no conclusions of law, and no dispositive portion directed at any particular party.
Another difference is that in the instant case, the issuance of the assailed revenue memorandum circular
operated to subject the taxpayer to the new law which was yet to take effect, while in Misamis, the disputed
revenue memorandum circular was issued simply to restate and then clarify the prevailing position and ruling of
the administrative agency, and no new law yet to take effect was involved. It merely interpreted an existing law
which had already been in effect for some time and which was not set to be amended. RMC 37-93 is thus
prejudicial to private respondent alone.
A third difference, and this likewise resolves the issue of discrimination, is that RMC 37-93 was ostensibly
issued to subject the cigarette brands of respondent corporation to a new law as it was promulgated two days
before the expiration of the old law and a few hours before the effectivity of the new law. That RMC 37-93 is
particularly aimed only at respondent corporation and its three (3) cigarette brands can be seen from the
dispositive portion of the assailed revenue memorandum circular
In view of the foregoing, the aforesaid brands of cigarettes, viz: Hope, More,
and Champion being manufactured by Fortune Tobacco Corporation are hereby considered
locally manufactured cigarettes bearing a foreign brand subject to the 55% ad valorem tax on
cigarettes.
Any ruling inconsistent herewith is revoked or modified accordingly.
Thus the argument of the Solicitor General that RMC 37-93 is not discriminatory as "[i]t merely lays down the
test in determining whether or not a locally manufactured cigarette bears a foreign brand using the cigarette
brandsHope, More and Champion as specific examples," cannot be accepted, much less sustained. Without
doubt, RMC 37-93 has a tremendous effect on respondent corporation and solely on respondent corporation
as its deficiency ad valorem tax assessment on its removals of Hope, Luxury, Premium More,
and Champion cigarettes for six (6) hours alone, i.e., from six o'clock in the evening of 2 July 1993 which is
presumably the time respondent corporation was supposed to have received the facsimile message sent by
Deputy Commissioner Victor A. Deoferio, until twelve o'clock midnight upon the effectivity of the new law,
was already P9,598,334.00. On the other hand, RMC 47-91 was issued with no purpose except to state and
declare what has been the official stand of the administrative agency on the specific subject matter, and was
indiscriminately directed to all copra traders with no particular individual in mind.
That petitioner Commissioner of Internal Revenue is an expert in her filed is not attempted to be disputed;
hence, we do not question the wisdom of her act in reclassifying the cigarettes. Neither do we deny her the
exercise of her quasi-legislative or quasi-judicial powers. But most certainly, by constitutional mandate, the
Court must check the exercise of these powers and ascertain whether petitioner has gone beyond the legitimate
bounds of her authority.

In the final analysis, the issue before us in not the expertise, the authority to promulgate rules, or the wisdom of
petitioner as Commissioner of Internal Revenue is reclassifying the cigarettes of private respondents. It is
simply the faithful observance by government by government of the basic constitutional right of a taxpayer to
due process of law and equal protection of the laws. This is what distresses me no end the manner and the
circumstances under which the cigarettes of private respondent were reclassified and correspondingly taxed
under RMC 37-93, and adjudicatory rule which therefore requires reasonable notice and hearing before its
issuance. It should not be confused with RMC 47-91, which is a mere interpretative rule.
In the earlier case of G.R. No. 119322, which practically involved the same opposing interests, I also voted to
uphold the constitutional right of the taxpayer concerned to due process and equal protection of the laws. By a
vote of 3-2, that view prevailed. In sequela, we in the First Division who constituted the majority found
ourselves unjustly drawn into the vortex of a nightmarish episode. The strong ripples whipped up by my opinion
expressed therein and of the majority have yet to varnish when we are again in the imbroglio of a similar
dilemma. The unpleasant experience should be reason enough to simply steer clear of this controversy and surf
on a pretendedloss of judicial objectivity. Such would have been an easy way out, a gracious exit, so to speak,
albeit lame. But to camouflage my leave with a sham excuse would be to turn away from a professional vow I
keep at all times; I would not be true to myself, and to the people I am committed to serve. Thus, as I have
earlier expressed, if placed under similar circumstances in some future time, I shall have to brave again the
prospect of another vilification and a tarnished image if only to show proudly to the whole world that under the
present dispensation judicial independence in our country is a true component of our democracy.
In fine, I am greatly perturbed by the manner RMC No. 37-93 was issued as well as the effect of such issuance.
For it cannot be denied that the circumstances clearly demonstrate that it was hastily issued without prior
notice and hearing, and singling out private respondent alone when two days before a new tax law was to
take effect petitioner reclassified and taxed the cigarette brands of private respondent at a higher rate.
Obviously, this was to make it appear that even before the anticipated date of effectivity of the statute which
was undeniably priorly known to petitioner these brands were already currently classified and taxed at fiftyfive percent (55%), thus shoving them into the purview of the law that was to take effect two days after!
For sure, private respondent was not properly informed before the issuance of the questioned memorandum
circular that its cigarette brands Hope Luxury, Premium More and Champion were being reclassified and
subjected to a higher tax rate. Naturally, the result would be to lose financially because private respondent was
still selling its cigarettes at a price based on the old, lower tax rate. Had there been previous notice and hearing,
as claimed by private respondent, it could have very well presented its side, either by opposing the
reclassification, or by acquiescing thereto but increasing the price of its cigarettes to adjust to the higher tax
rate. The reclassification and the ensuing imposition of a tax rate increase therefore could not be anything but
confiscatory if we are also to consider the claim of private respondent that the new tax is even higher than the
cost of its cigarettes.
Accordingly, I vote to deny the petition.

HERMOSISIMA, JR., J.: dissenting

Private respondent Fortune Tobacco Corporation in the instant case disputes its liability for deficiency ad
valoremexcise taxes on its removals of "Hope," "More," and "Champion" cigarettes from 6:00 p.m. to 12:00
midnight of July 2, 1993, in the total amount of P9,598,334.00. It claims that the circular, upon which the
assessment was based and made, is defective, invalid and unenforceable for having been issued without notice
and hearing and in violation of the equal protection clause guaranteed by the Constitution.

The majority upholds these claims of private respondent, convinced that the Circular in question, in the first
place, did not give prior notice and hearing, and so, it could not have been valid and effective. It proceeds to
affirm the factual findings of the Court of Tax Appeals, which findings were considered correct by respondent
Court of Appeals, to the effect that the petitioner Commissioner of Internal Revenue had indeed blatantly failed
to comply with the said twin requirements of notice and hearing, thereby rendering the issuance of the
questioned Circular to be in violation of the due process clause of the Constitution. It is also its dominant
opinion that the questioned Circular discriminates against private respondent Fortune Tobacco Corporation
insofar as it seems to affect only its "Hope," "More," and "Champion" cigarettes, to the exclusion of other
cigarettes apparently of the same kind or classification as these cigarettes manufactured by private respondent.
With all due respect, I disagree with the majority in its disquisition of the issues and its resulting conclusions.
Section 245 of the National Internal Revenue Code,
as amended, empowers the Commissioner of Internal
Revenue to issue the questioned Circular
Section 245 of the National Internal Revenue Code, as amended, provides:
Sec. 245. Authority of Secretary of Finance to promulgate rules and regulations. The
Secretary of Finance, upon recommendation of the Commissioner, shall promulgate all needful
rules and regulations for the effective enforcement of the provisions of this Code . . . without
prejudice to the power of the Commissioner of Internal Revenue to make rulings or opinions in
connection with the implementation of the provisions of internal revenue laws, including rulings
on the classification of articles for sales tax and similar purposes.
The subject of the questioned Circular is the reclassification of cigarettes subject to excise taxes. It was issued
in connection with Section 142 (c) (1) of the National Internal Revenue Code, as amended, which imposes ad
valorem excise taxes on locally manufactured cigarettes bearing a foreign brand. The same provision prescribes
the ultimate criterion that determines which cigarettes are to be considered "locally manufactured cigarettes
bearing a foreign brand." It provides:
. . . Whenever it has to be determined whether or not a cigarette bears a foreign brand, the listing
of brands manufactured in foreign countries appearing in the current World Tobacco Directory
shall govern.
There is only one World Tobacco Directory for a given current year, and the same is mandated by law to
be the BIR Commissioner's controlling basis for determining whether or not a particular locally
manufactured cigarette is one bearing a foreign brand. In so making a determination, petitioner should
inquire into the entries in the World Tobacco Directory for the given current year and shall be held
bound by such entries therein. She is not required to subject the results of her inquiries to feedback from
the concerned cigarette manufacturers, and it is doubtlessly not desirable nor managerially sound to
court dispute thereon when the law does not, in the first place, require debate or hearing thereon.
Petitioner may make such a determination because she is the Chief Executive Officer of the
administrative agency that is the Bureau of Internal Revenue in which are vested quasi-legislative
powers entrusted to it by the legislature in recognition of its more encompassing and unequalled
expertise in the field of taxation.
The vesture of quasi-legislative and quasi-judicial powers in administrative bodies is not
unconstitutional, unreasonable and oppressive. It has been necessitated by "the growing
complexity of the modern society" (Solid Homes, Inc. vs. Payawal, 177 SCRA 72, 79). More and
more administrative bodies are necessary to help in the regulation of society's ramified activities.
"Specialized in the particular field assigned to them, they can deal with the problems thereof

with more expertise and dispatch than can be expected from the legislature or the courts of
justice" . . . 1
Statutorily empowered to issue rulings or opinions embodying the proper determination in respect to classifying
articles, including cigarettes, for purposes of tax assessment and collection, petitioner was acting well within her
prerogatives when she issued the questioned Circular. And in the exercise of such prerogatives under the law,
she has in her favor the presumption of regular performance of official duty which must be overcome by clearly
persuasive evidence of stark error and grave abuse of discretion in order to be overturned and disregarded.
It is irrelevant that the Court of Tax Appeals makes much of the effect of the passing of Republic Act No.
7654 2 on petitioner's power to classify cigarettes. Although the decisions assailed and sought to be reviewed, as
well as the pleadings of private respondent, are replete with alleged admissions of our legislators to the effect
that the said Act was intended to freeze the current classification of cigarettes and make the same an integral
part of the said Act, certainly the repeal, if any, of petitioner's power to classify cigarettes must be reckoned
from the effectivity of the said Act and not before. Suffice it to say that indisputable is the plain fact that the
questioned Circular was issued on July 1, 1993, while the said Act took effect on July 3, 1993.
The contents of the questioned circular have not
been proven to be erroneous or illegal as to render
issuance thereof an act of grave abuse of
discretion on the part of petitioner Commissioner
Prior to the effectivity of R.A. No. 7654, Section 142 (c) (1) of the National Internal Revenue Code, as
amended, levies the following ad valorem taxes on cigarettes in accordance with their predetermined
classifications as established by the Commissioner of Internal Revenue:
. . . based on the manufacturer's registered wholesale price:
(1) On locally manufactured cigarettes bearing a foreign brand, fifty-five percent (55%)
Provided, That this rate shall apply regardless of whether or not the right to use or title to the
foreign brand was sold or transferred by its owner to the local manufacturer. Whenever it has to
be determined whether or not a cigarette bears a foreign brand, the listing of brands
manufactured in foreign countries appearing in the current World Tobacco Directory shall
govern.
(2) Other locally manufactured cigarettes, forty five percent (45%).
xxx xxx xxx
Prior to the issuance of the questioned Circular, assessed against and paid by private respondent as ad
valoremexcise taxes on their removals of "Hope," "More," and "Champion" cigarettes were amounts based on
paragraph (2) above, i.e., the tax rate made applicable on the said cigarettes was 45% at the most. The reason
for this is that apparently, petitioner's predecessors have all made determinations to the effect that the said
cigarettes were to be considered "other locally manufactured cigarettes" and not "locally manufactured
cigarettes bearing a foreign brand." Even petitioner, until her issuance of the questioned Circular, adhered to her
predecessors' determination as to the proper classification of the above-mentioned cigarettes for purposes of ad
valorem excise taxes. Apparently, the past determination that the said cigarettes were to be classified as "other
locally manufactured cigarettes" was based on private respodnent's convenient move of changing the names of
"Hope" to "Hope Luxury" and "More" to "Premium More." It also submitted proof that "Champion" was an
original Fortune Tobacco Corporation register and, therefore, a local brand. Having registered these brands with
the Philippine Patent Office and with corresponding evidence to the effect, private respondent paid ad

valorem excise taxes computed at the rate of not more than 45% which is the rate applicable to cigarettes
considered as locally manufactured brands.
How these past determinations pervaded notwithstanding their erroneous basis is only tempered by their innate
quality of being merely errors in interpretative ruling, the formulation of which does not bind the government.
Advantage over such errors may precipitously be withdrawn from those who have been benefiting from them
once the same have been discovered and rectified.
Petitioner correctly emphasizes that:
. . . the registration of said brands in the name of private respondent is proof only that it is the
exclusive owner thereof in the Philippines; it does not necessarily follow, however, that it is the
exclusive owner thereof in the whole world. Assuming arguendo that private respondent is the
exclusive owner of said brands in the Philippines, it does not mean that they are local. Otherwise,
they would not have been listed in the WTD as international brands manufactured by different
entities in different countries. Moreover, it cannot be said that the brands registered in the names
of private respondent are not the same brands listed in the WTD because private respondent is
one of the manufacturers of said brands listed in the WTD. 3
Private respondent attempts to cast doubt on the determination made by petitioner in the questioned Circular
that Japan is a manufacturer of "Hope" cigarettes. Private respondent's own inquiry into the World Tobacco
Directory reveals that Japan is not a manufacturer of "Hope" cigarettes. In pointing this out, private respondent
concludes that the entire Circular is erroneous and makes such error the principal proof of its claim that the
nature of the determination embodied in the questioned Circular requires a hearing on the facts and a debate on
the applicable law. Such a determination is adjudicatory in nature and, therefore, requires notice and hearing.
Private respondent is, however, apparently only eager to show error on the part of petitioner for acting with
grave abuse of discretion. Private respondent conveniently forgets that petitioner, equipped with the expertise in
taxation, recognized in that expertise by the legislature that vested in her the power to make rules respecting
classification of articles for taxation purposes, and presumed to have regularly exercised her prerogatives within
the scope of her statutory power to issue determinations specifically under Section 142 (c) (1) in relation to
Section 245 of the National Internal Revenue Code, as amended, simply followed the law as she understood it.
Her task was to determine which cigarette brands were foreign, and she was directed by the law to look into the
World Tobacco Directory. Foreign cigarette brands were legislated to be taxed at higher rates because of their
more extensive public exposure and international reputation; their competitive edge against local brands may
easily be checked by imposition of higher tax rates. Private respondent makes a mountain of the mole hill
circumstance that "Hope" is listed, not as being "manufactured" by Japan but as being "used" by Japan. Whether
manufactured or used by Japan, however, "Hope" remains a cigarette brand that can not be said to be limited to
local manufacture in the Philippines. The undeniable fact is that it is a foreign brand the sales in the Philippines
of which are greatly boosted by its international exposure and reputation. The petitioner was well within her
prerogatives, in the exercise of her rule-making power, to classify articles for taxation purposes, to interpret the
laws which she is mandated to administer. In interpreting the same, petitioner must, in general, be guided by the
principles underlying taxation, i.e., taxes are the lifeblood of Government, and revenue laws ought to be
interpreted in favor of the Government, for Government can not survive without the funds to underwrite its
varied operational expenses in pursuit of the welfare of the society which it serves and protects.
Private respondent claims that its business will be destroyed by the imposition of additional ad valorem taxes as
a result of the effectivity of the questioned Circular. It claims that under the vested rights theory, it cannot now
be made to pay higher taxes after having been assessed for less in the past. Of course private respondent will
trumpet its losses, its interests, after all, being its sole concern. What private respondent fails to see is the loss of
revenue by the Government which, because of erroneous determinations made by its past revenue
commissioners, collected lesser taxes than what it was entitled to in the first place. It is every citizen's duty to
pay the correct amount of taxes. Private respondent will not be shielded by any vested rights, for there are not

vested rights to speak of respecting a wrong construction of the law by administrative officials, and such wrong
interpretation does not place the Government in estoppel to correct or overrule the same. 4
The Questioned Circular embodies an interpretative
ruling of petitioner Commissioner which as such does
not require notice and hearing
As one of the public offices of the Government, the Bureau of Internal Revenue, through its Commissioner, has
grown to be a typical administrative agency vested with a fusion of different governmental powers: the power to
investigate, initiate action and control the range of investigation, the power to promulgate rules and regulations
to better carry out statutory policies, and the power to adjudicate controversies within the scope of their
activities. 5 In the realm of administrative law, we understand that such an empowerment of administrative
agencies was evolved in response to the needs of a changing society. This development arose as the need for
broad social control over complex conditions and activities became more and more pressing, and such
complexity could no longer be dealt with effectivity and directly by the legislature or the judiciary. The theory
which underlies the empowerment of administrative agencies like the Bureau of Internal Revenue, is that the
issues with which such agencies deal ought to be decided by experts, and not be a judge, at least not in the first
instance or until the facts have been sifted and arranged. 6
One of the powers of administrative agencies like the Bureau of Internal Revenue, is the power to make rules.
The necessity for vesting administrative agencies with this power stems from the impracticability of the
lawmakers providing general regulations for various and varying details pertinent to a particular legislation. 7
The rules that administrative agencies may promulgate may either be legislative or interpretative. The former is
a form of subordinate legislation whereby the administrative agency is acting in a legislative capacity,
supplementing the statute, filling in the details, pursuant to a specific delegation of legislative power. 8
Interpretative rules, on the other hand, are "those which purport to do no more than interpret the statute being
administered, to say what it means." 9
There can be no doubt that there is a distinction between an administrative rule or regulation and
an administrative interpretation of a law whose enforcement is entrusted to an administrative
body. When an administrative agency promulgates rules and regulations, it "makes" a new law
with the force and effect of a valid law, while when it renders an opinion or gives a statement of
policy, it merely interprets a pre-existing law (Parker, Administrative Law, p. 197; Davis
Administrative Law, p. 194). Rules and regulations when promulgated in pursuance of the
procedure or authority conferred upon the administrative agency by law, partake of the nature of
a statute, and compliance therewith may be enforced by a penal sanction provided in the law.
This is so because statutes are usually couched in general terms, after expressing the policy,
purposes, objectives, remedies and sanctions intended by the legislature. The details and the
manner of carrying out the law are often times left to the administrative agency entrusted with its
enforcement. In this sense, it has been said that rules and regulations are the product of a
delegated power to create new or additional legal provisions that have the effect of law.
(Davis, op. cit. p. 194.)
A rule is binding on the courts as long as the procedure fixed for its promulgation is followed
and its scope is within the statutory authority granted by the legislature, even if the courts are not
in agreement with the policy stated therein or its innate wisdom (Davis, op. cit. pp. 195-197). On
the other hand, administrative interpretation of the law is at best merely advisory, for it is the
courts that finally determine what the law means. 10

"Whether a given statutory delegation authorizes legislative or interpretative regulations depends upon whether
the statute places specific 'sanctions' behind the regulations authorized, as for example, by making it a criminal
offense to disobey them, or by making conformity with their provisions a condition of the exercise of legal
privileges." 11 This is because interpretative regulations are by nature simply statutory interpretations, which
have behind them no statutory sanction. Such regulations, whether so expressly authorized by statute or issued
only as an incident of statutory administration, merely embody administrative findings of law which are always
subject to judicial determination as to whether they are erroneous or not, even when their issuance is authorized
by statute.
The questioned Circular has undisputedly been issued by petitioner in pursuance of her rule-making powers
under Section 245 of the National Internal Revenue Code, as amended. Exercising such powers, petitioner reclassified "Hope," "More" and "Champion" cigarettes as locally manufactured cigarettes bearing foreign brands.
The re-classification, as previously explained, is the correct interpretation of Section 142 (c) (1) of the said
Code. The said legal provision is not accompanied by any penal sanction, and no detail had to be filled in by
petitioner. The basis for the classification of cigarettes has been provided for by the legislature, and all
petitioner has to do, on behalf of the government agency she heads, is to proceed to make the proper
determination using the criterion stipulated by the lawmaking body. In making the proper determination,
petitioner gave it a liberal construction consistent with the rule that revenue laws are to be construed in favor of
the Government whose survival depends on the contributions that taxpayers give to the public coffers that
finance public services and other governmental operations.
The Bureau of Internal Revenue which petitioner heads, is the government agency charged with the
enforcement of the laws pertinent to this case and so, the opinion of the Commissioner of Internal Revenue, in
the absence of a clear showing that it is plainly wrong, is entitled to great weight. Private respondent claims that
its rights under previous interpretations of Section 142 (c) (1) may not abruptly be cut by a new interpretation of
the said section, but precisely the said section is subject to various and changing construction, and hence, any
ruling issued by petitioner thereon is necessarily interpretative and not legislative. Private respondent insists that
the questioned circular is adjudicatory in nature because it determined the rights of private respondent in a
controversy involving his tax liability. It also asseverates that the questioned circular involved administrative
action that is particular and immediate, thereby rendering it subject to the requirements of notice and hearing in
compliance with the due process clause of the Constitution.
We find private respondent's arguments to be rather strained.
Petitioner made a determination as to the classification of cigarettes as mandated by the aforecited provisions in
the National Internal Revenue Code, as amended. Such determination was an interpretation by petitioner of the
said legal provisions. If in the course of making the interpretation and embodying the same in the questioned
circular which the petitioner subsequently issued after making such a determination, private respondent's
cigarettes products, by their very nature of being foreign brands as evidenced by their enlistment in the World
Tobacco Directory, which is the controlling basis for the proper classification of cigarettes as stipulated by the
law itself, have come to be classified as locally manufactured cigarettes bearing foreign brands and as such
subject to a tax rate higher than what was previously imposed thereupon based on past rulings of other revenue
commissioners, such a situation is simply a consequence of the performance by petitioner of here duties under
the law. No adjudication took place, much less was there any controversy ripe for adjudication. The natural
consequences of making a classification in accordance with law may not be used by private respondent in
arguing that the questioned circular is in fact adjudicatory in nature. Such an exercise in driving home a point is
illogical as it is fallacious and misplaced.
Private respondent concedes that under general rules of administrative law, "a ruling which is merely
'interpretative' in character may not require prior notice to affected parties before its issuance as well as a
hearing" and "for this reason, in most instances, interpretative regulations are not given the force of
law." 12Indeed, "interpretative regulations and those merely internal in nature

. . . need not be published." 13 And it is now settled that only legislative regulations and not interpretative
rulings must have the benefit of public
hearing. 14
Because (1) the questioned circular merely embodied an interpretation or a way of reading and giving meaning
to Section 142 (c) (1) of the National Internal Revenue Code, as amended; (2) petitioner did not fill in any
details in the aforecited section but only classified cigarettes on the basis of the World Tobacco Directory in the
light of the paramount principle of construing revenue laws in favor of the Government to the end that
Government collects as much tax money as it is entitled to in order to fulfill its public purposes for the general
good of its citizens; (3) no penal sanction is provided in the aforecited section that was construed by petitioner
in the questioned circular; and (4) a similar circular declassifying copra from being an agricultural food to nonfood product for purposes of the value added tax laws, resulting in the revocation of an exemption previously
enjoyed by copra traders, has been ruled by us to be merely an interpretative ruling and not a legislative, much
less, an adjudicatory, action on the part of the revenue commissioner, 15 this Court must not be blind to the fact
that the questioned Circular is indeed an interpretative ruling not subject to notice and hearing.
Neither is the questioned Circular tainted by a
violation of the equal protection clause under the
Constitution
Private respondent anchors its claim of violation of its equal protection rights upon the too obvious fact that
only its cigarette brands, i.e., "Hope," "More" and "Champion," are mentioned in the questioned circular.
Because only the cigarettes that they manufacture are enumerated in the questioned circular, private respondent
proceeded to attack the same as being discriminatory against it. On the surface, private respondent seems to
have a point there. A scrutiny of the questioned Circular, however, will show that it is undisputedly one of
general application for all cigarettes that are similarly situated as private respondent's brands. The new
interpretation of Section 142 (1) (c) has been well illustrated in its application upon private respondent's brands,
which illustration is properly a subject of the questioned Circular. Significantly, indicated as the subject of the
questioned circular is the "reclassification of cigarettes subject to excise taxes." The reclassification resulted in
the foregrounding of private respondent's cigarette brands, which incidentally is largely due to the controversy
spawned no less by private respondent's own action of conveniently changing its brand names to avoid falling
under a classification that would subject it to higher ad valorem tax rates. This caused then Commissioner
Bienvenido Tan to depart from his initial determination that private respondent's cigarette brands are foreign
brands. The consequent specific mention of such brands in the questioned Circular, does not change the fact that
the questioned Circular has always been intended for and did cover, all cigarettes similarly situated as "Hope,"
"More" and "Champion." Petitioner is thus correct in stating that:

. . . RMC 37-93 is not discriminatory. It lays down the test in determining whether or not a
locally manufactured cigarette bears a foreign brand using the cigarette brands "Hope," More and
"Champion" as specific examples. Such test applies to all locally manufactured cigarette brands
similarly situated as the cigarette brands aforementioned. While it is true that only "Hope,"
"More" and "Champion" cigarettes are actually determined as locally manufactured cigarettes
bearing a foreign brand, RMC 37-93 does not state that ONLY cigarettes fall under such
classification to the exclusion of other cigarettes similarly situated. Otherwise stated, RMC 37-93
does not exclude the coverage of other cigarettes similarly situated. Otherwise stated, RMC 3793 does not exclude the coverage of other cigarettes similarly situated as locally manufactured
cigarettes bearing a foreign brand. Hence, in itself, RMC 37-93 is not discriminatory. 16
Both the respondent Court of Appeals and the Court of Tax Appeals held that the questioned Circular
reclassifying "Hope," "More" and "Champion" cigarettes, is defective, invalid and unenforceable and has

rendered the assessment against private respondent of deficiency ad valorem excise taxes to be without legal
basis. The majority agrees with private respondent and respondent Courts. As the foregoing opinion chronicles
the fatal flaws in private respondent's arguments, it becomes more apparent that the questioned Circular is in
fact a valid and subsisting interpretative ruling that the petitioner had power to promulgate and enforce.
WHEREFORE, I vote to grant the petition and set aside the decisions of the Court of Tax Appeals and the
Court of Appeals, respectively, and to reinstate the decision of petitioner Commissioner of Internal Revenue
denying private respondent's request for a review, reconsideration and recall of Revenue Memorandum Circular
No. 37-93 dated July 1, 1993.
Padilla, J., concurs.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 78385 August 31, 1987
PHILIPPINE CONSUMERS FOUNDATION, INC., petitioner,
vs.
THE SECRETARY OF EDUCATION, CULTURE AND SPORTS, respondent.

GANCAYCO, J.:
This is an original Petition for prohibition with a prayer for the issuance of a writ of preliminary injunction.
The record of the case discloses that the herein petitioner Philippine Consumers Foundation, Inc. is a non-stock,
non-profit corporate entity duly organized and existing under the laws of the Philippines. The herein respondent
Secretary of Education, Culture and Sports is a ranking cabinet member who heads the Department of
Education, Culture and Sports of the Office of the President of the Philippines.
On February 21, 1987, the Task Force on Private Higher Education created by the Department of Education,
Culture and Sports (hereinafter referred to as the DECS) submitted a report entitled "Report and
Recommendations on a Policy for Tuition and Other School Fees." The report favorably recommended to the
DECS the following courses of action with respect to the Government's policy on increases in school fees for
the schoolyear 1987 to 1988
(1) Private schools may be allowed to increase its total school fees by not more than 15 per cent
to 20 per cent without the need for the prior approval of the DECS. Schools that wish to increase
school fees beyond the ceiling would be subject to the discretion of the DECS;
(2) Any private school may increase its total school fees in excess of the ceiling, provided that
the total schools fees will not exceed P1,000.00 for the schoolyear in the elementary and
secondary levels, and P50.00 per academic unit on a semestral basis for the collegiate level. 1
The DECS took note of the report of the Task Force and on the basis of the same, the DECS, through the
respondent Secretary of Education, Culture and Sports (hereinafter referred to as the respondent Secretary),
issued an Order authorizing, inter alia, the 15% to 20% increase in school fees as recommended by the Task
Force. The petitioner sought a reconsideration of the said Order, apparently on the ground that the increases
were too high. 2 Thereafter, the DECS issued Department Order No. 37 dated April 10, 1987 modifying its
previous Order and reducing the increases to a lower ceiling of 10% to 15%, accordingly. 3 Despite this
reduction, the petitioner still opposed the increases. On April 23, 1987, the petitioner, through counsel, sent a
telegram to the President of the Philippines urging the suspension of the implementation of Department Order
No. 37. 4 No response appears to have been obtained from the Office of the President.
Thus, on May 20, 1987, the petitioner, allegedly on the basis of the public interest, went to this Court and filed
the instant Petition for prohibition, seeking that judgment be rendered declaring the questioned Department
Order unconstitutional. The thrust of the Petition is that the said Department Order was issued without any legal
basis. The petitioner also maintains that the questioned Department Order was issued in violation of the due

process clause of the Constitution in asmuch as the petitioner was not given due notice and hearing before the
said Department Order was issued.
In support of the first argument, the petitioner argues that while the DECS is authorized by law to regulate
school fees in educational institutions, the power to regulate does not always include the power to increase
school fees. 5
Regarding the second argument, the petitioner maintains that students and parents are interested parties that
should be afforded an opportunity for a hearing before school fees are increased. In sum, the petitioner stresses
that the questioned Order constitutes a denial of substantive and procedural due process of law.
Complying with the instructions of this Court, 6 the respondent Secretary submitted a Comment on the
Petition. 7 The respondent Secretary maintains, inter alia, that the increase in tuition and other school fees is
urgent and necessary, and that the assailed Department Order is not arbitrary in character. In due time, the
petitioner submitted a Reply to the Comment. 8 Thereafter, We considered the case submitted for resolution.
After a careful examination of the entire record of the case, We find the instant Petition devoid of merit.
We are not convinced by the argument that the power to regulate school fees "does not always include the
power to increase" such fees. Section 57 (3) of Batas Pambansa Blg. 232, otherwise known as The Education
Act of 1982, vests the DECS with the power to regulate the educational system in the country, to wit:
SEC. 57. Educations and powers of the Ministry. The Ministry shall:
xxx xxx xxx
(3) Promulgate rules and regulations necessary for the administration, supervision and regulation
of the educational system in accordance with declared policy.
xxx xxx xxx 9
Section 70 of the same Act grants the DECS the power to issue rules which are likewise necessary to discharge
its functions and duties under the law, to wit:
SEC. 70. Rule-making Authority. The Minister of Education and Culture, charged with the
administration and enforcement of this Act, shall promulgate the necessary implementing rules
and regulations.
In the absence of a statute stating otherwise, this power includes the power to prescribe school fees. No other
government agency has been vested with the authority to fix school fees and as such, the power should be
considered lodged with the DECS if it is to properly and effectively discharge its functions and duties under the
law.
We find the remaining argument of the petitioner untenable. The petitioner invokes the due process clause of
the Constitution against the alleged arbitrariness of the assailed Department Order. The petitioner maintains that
the due process clause requires that prior notice and hearing are indispensable for the Department Order to be
validly issued.
We disagree.

The function of prescribing rates by an administrative agency may be either a legislative or an adjudicative
function. If it were a legislative function, the grant of prior notice and hearing to the affected parties is not a
requirement of due process. As regards rates prescribed by an administrative agency in the exercise of its quasijudicial function, prior notice and hearing are essential to the validity of such rates. When the rules and/or rates
laid down by an administrative agency are meant to apply to all enterprises of a given kind throughout the
country, they may partake of a legislative character. Where the rules and the rates imposed apply exclusively to
a particular party, based upon a finding of fact, then its function is quasi-judicial in character. 9a
Is Department Order No. 37 issued by the DECS in the exercise of its legislative function? We believe so. The
assailed Department Order prescribes the maximum school fees that may be charged by all private schools in
the country for schoolyear 1987 to 1988. This being so, prior notice and hearing are not essential to the validity
of its issuance.
This observation notwithstanding, there is a failure on the part of the petitioner to show clear and convincing
evidence of such arbitrariness. As the record of the case discloses, the DECS is not without any justification for
the issuance of the questioned Department Order. It would be reasonable to assume that the report of the Task
Force created by the DECS, on which it based its decision to allow an increase in school fees, was made
judiciously. Moreover, upon the instance of the petitioner, as it so admits in its Petition, the DECS had actually
reduced the original rates of 15% to 20% down to 10% to 15%, accordingly. Under the circumstances peculiar
to this case, We cannot consider the assailed Department Order arbitrary.
Under the Rules of Court, it is presumed that official duty has been regularly performed. 10 In the absence of
proof to the contrary, that presumption prevails. This being so, the burden of proof is on the party assailing the
regularity of official proceedings. In the case at bar, the petitioner has not successfully disputed the
presumption.
We commend the petitioner for taking the cudgels for the public, especially the parents and the students of the
country. Its zeal in advocating the protection of the consumers in its activities should be lauded rather than
discouraged. But a more convincing case should be made out by it if it is to seek relief from the courts some
time in the future. Petitioner must establish that respondent acted without or in excess of her jurisdiction; or
with grave abuse of discretion, and there is no appeal or any other plain, speedy, and adequate remedy in the
ordinary course of law before the extraordinary writ of prohibition may issue. 11
This Court, however, does not go to the extent of saying that it gives its judicial imprimatur to future increases
in school fees. The increases must not be unreasonable and arbitrary so as to amount to an outrageous exercise
of government authority and power. In such an eventuality, this Court will not hesitate to exercise the power of
judicial review in its capacity as the ultimate guardian of the Constitution.
WHEREFORE, in view of the foregoing, the instant Petition for prohibition is hereby DISMISSED for lack of
merit. We make no pronouncement as to costs.
SO ORDERED.