PHILIPPINE CONSUMERS FOUNDATION, as the petitioner was not given due notice
INC., petitioner, and hearing before the said Department
vs. Order was issued. The petitioner argues that THE SECRETARY OF EDUCATION, while the DECS is authorized by law to CULTURE AND SPORTS, respondent. regulate school fees in educational institutions, the power to regulate does not FACTS: always include the power to increase school fees. The petitioner also maintains that Task Force on Private Higher Education students and parents are interested parties created by the Department of Education, that should be afforded an opportunity for a Culture and Sports (hereinafter referred to as hearing before school fees are increased. In the DECS) submitted a report entitled sum, the petitioner stresses that the "Report and Recommendations on a Policy questioned Order constitutes a denial of for Tuition and Other School Fees." The report substantive and procedural due process of favorably recommended to the DECS that; law. ALL 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. ISSUE: Schools that wish to increase school fees beyond the ceiling would be subject to the WON the fixing of school fees through discretion of the DECS. Department Order by DECS is a Valid Delegation of Legislative power and WON DECS then, issued an Order such Department Order violates the notice authorizing, the 15% to 20% increase in and hearing of due process of law. school fees as recommended by the Task Force. The petitioner sought a HELD: reconsideration of the said Order, apparently on the ground that the increases were too Power granted to the educational high. Thereafter, the DECS issued D.O No. department to regulate the educational modifying its previous Order and reducing system includes the power to prescribe the increases to a lower ceiling of 10% to school fees. In the absence of a statute 15%, accordingly. 3 Despite this reduction, stating otherwise, this power include the the petitioner still opposed the increases. power to prescribe school fees. No other Thusthe petitioner, allegedly on the basis of government agency has been vested with the public interest, went to this Court and the authority to fix school fees and as such, filed the instant Petition for prohibition, the power should be considered lodged with seeking that judgment be rendered declaring the DECS. the questioned Department Order unconstitutional. The thrust of the Petition is The function of prescribing rates by an that the said Department Order was issued administrative agency may be either a without any legal basis. The petitioner also legislative or an adjudicative function. If it maintains that the questioned Department were a legislative function, the grant of prior Order was issued in violation of the due notice and hearing to the affected parties is process clause of the Constitution in as much not a requirement of due process. As regards rates prescribed by an administrative agency A 45% Ad Valorem taxes were imposed on in the exercise of its quasi-judicial function, these brands. Then Republic Act ("RA") No. prior notice and hearing are essential to the 7654 was enacted 55% for locally manufactured foreign brand while 45% for validity of such rates. When the rules and/or locally manufactured brands. 2 rates laid down by an administrative agency days before the effectivity of RA 7654, are meant to apply to all enterprises of a Revenue Memorandum Circular No. 37-93 given kind throughout the country, they may ("RMC 37-93"), was issued by the BIR saying partake of a legislative character. Where the since there is no showing who the real rules and the rates imposed apply owner/s are of Champion, Hope and More, it exclusively to a particular party, based upon follows that the same shall be considered locally manufactured foreign brand for a finding of fact, then its function is quasi- purposes of determining the ad judicial in character. The assailed valorem tax - 55%. BIR sent via telefax a Department Order prescribes the maximum copy of RMC 37-93 to Fortune Tobacco school fees that may be charged by all addressed to no one in particular. Then private schools in the country for schoolyear Fortune Tobacco received, by ordinary mail, a 1987 to 1988. This being so, prior notice and certified xerox copy of RMC 37-93. CIR hearing are not essential to the validity of its assessed Fortune Tobacco for ad valorem tax deficiency amounting to P9,598,334.00. issuance. Fortune Tobacco filed a petition for review with the CTA. CTA upheld the position of Fortune. CA affirmed.
ISSUE:
WON it was necessary for BIR to follow the
legal requirements when it issued its RMC
HELD:
YES. CIR may not disregard legal
requirements in the exercise of its quasi- legislative powers which publication, filing, and prior hearing. CIR vs. CA, CTA and FORTUNE TOBACCO CORP. When an administrative rule is merely interpretative in nature, its applicability G.R. No. 119761; August 29, 1996 needs nothing further than its bare issuance for it gives no real consequence more than FACTS: what the law itself has already prescribed. BUT when, upon the other hand, the Fortune Tobacco Corporation ("Fortune administrative rule goes beyond merely Tobacco"), engaged in the manufacture of providing for the means that can facilitate or different brands of cigarettes, registered render least cumbersome the "Champion," "Hope," and "More" cigarettes. implementation of the law but substantially BIR classified them as foreign brands since increases the burden of those governed, the they were listed in the World Tobacco agency must accord, at least to those Directory as belonging to foreign companies. directly affected, a chance to be heard, However, Fortune changed the names of before that new issuance is given the force 'Hope' to 'Hope Luxury' and 'More' to and effect of law. 'Premium More,' thereby removing the said brands from the foreign brand category. RMC 37-93 cannot be viewed simply as Upon the outbreak of the Persian Gulf construing Section 142(c)(1) of the NIRC, as conflict, private respondents oil companies amended, but has, in fact and most filed with the ERB their respective importantly, been made in order to place applications on oil price increases. The ERB "Hope Luxury," "Premium More" and "Champion" within the classification of locally then, issued an order granting a provisional manufactured cigarettes bearing foreign increase of P1.42 per liter. Petitioner Maceda brands and to thereby have them covered by filed a petition for Prohibition seeking to RA 7654 which subjects mentioned brands to nullify the provisional increase. The Trial 55% the BIR not simply interpreted the law; dismissed the petition, reaffirming ERB's verily, it legislated under its quasi-legislative authority to grant provisional increase even authority. The due observance of the without prior hearing. requirements of notice, of hearing, and of publication should not have been then ignored. In the same order the ERB set the applications for hearing with due notice to all interested parties. Petitioner Maceda failed to appear at said hearing as well as on the second hearing.
To afford registered oppositors the
opportunity to cross-examine the witnesses, the ERB set the continuation of the hearing. This was postponed, on written notice of petitioner Maceda. Then, the three oil companies filed their respective motions for leave to file or admit amended/supplemental applications to further increase the prices of petroleum products.
The ERB admitted the respective
supplemental/amended petitions at the same time requiring applicants to publish the corresponding Notices of Public Hearing in two newspapers of general circulation Hearing for the presentation of the evidence- in-chief commenced on November 21, 1990 with ERB ruling that testimonies of witnesses were to be in the form of Affidavits.
Petitioner Maceda maintains that this order
of proof deprived him of his right to finish his ERNESTO M. MACEDA, petitioner, cross-examination of Petron's witnesses and vs. ENERGY REGULATORY BOARD, CALTEX denied him his right to cross-examine each (Philippines), INC., PILIPINAS SHELL of the witnesses of Caltex and Shell. He PETROLEUM CORPORATION AND points out that this relaxed procedure PETRON CORPORATION, respondents resulted in the denial of due process.
FACTS: ISSUE:
WON the ERB, as an administrative agency is
bound by the strict or technical rules of evidence governing court proceedings.
HELD:
NO. The Solicitor General has pointed out: . .
. The order of testimony both with respect to the examination of the particular witness and HON. RENATO C. CORONA, et to the general course of the trial is within the al. petitioners, vs. UNITED discretion of the court and the exercise of HARBOR PILOTS ASSOCIATION OF this discretion in permitting to be introduced THE PHILIPPINES and MANILA out of the order prescribed by the rules is PILOTS not improper. Such a relaxed procedure is ASSOCIATION, respondents. especially true in administrative bodies, such as the ERB which in matters of rate or price FACTS: fixing is considered as exercising a quasi- In issuing Administrative Order No. 04- legislative, not quasi-judicial, function As 92 (PPA-AO No. 04-92), limiting the term of such administrative agency, it is not bound appointment of harbor pilots to one year by the strict or technical rules of evidence subject to yearly renewal or cancellation. governing court proceedings. In fact, Section Respondents United Harbor Pilots Association 2, Rule I of the Rules of Practice and and the Manila Pilots Association questioned Procedure Governing Hearings Before the PPA-AO No. 04-92 before the DOTC, but they ERB provides that These Rules shall were informed by then DOTC Secretary Jesus B. Garcia that the matter of reviewing, govern pleadings, practice and procedure recalling or annulling PPAs administrative before the Energy Regulatory Board in all issuances lies exclusively with its Board of matters of inquiry, study, hearing, Directors as its governing body. The OP investigation and/or any other proceedings (Office of the President) issued an order within the jurisdiction of the Board. However, directing the PPA to hold in abeyance the in the broader interest of justice, the Board implementation of PPA-AO No. 04-92. In its answer, the PPA countered that said may, in any particular matter, except itself administrative order was issued in the from these rules and apply such suitable exercise of its administrative control and procedure as shall promote the objectives of supervision over harbor pilots and it was the Order. intended to restore order in the ports and to improve the quality of port services. Then, the OP, through then Assistant Executive Secretary for Legal Affairs Renato C. Corona, dismissed the appeal/petition and lifted the restraining order issued earlier. 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 executive or legislative functions, such as was merely implementing Section 6 of P.D. issuing rules and regulations, an No. 857, mandating it to control, regulate administrative body need not comply with and supervise pilotage and conduct of pilots the requirements of notice and hearing. in any port district. Consequently, respondents filed a petition for certiorari, There is no dispute that pilotage as a prohibition and injunction with prayer for the profession has taken on the nature of a issuance of a temporary restraining order property right. Even petitioner Corona and damages, before RTC of Manila. The Trial recognized this when he stated in his Court rendered a judgment, declaring PPA decision that (t)he exercise of ones Administrative Order 04-92 and its profession falls within the constitutional implementing Circulars and Orders as null guarantee against wrongful deprivation of, or and void. interference with, property rights without due process. He merely expressed the ISSUE: opinion that (i)n the limited context of this case, PPA-AO 04-92 does not constitute a WON PPA Administrative Order 04-92 and its wrongful interference with, let alone a implementing Circulars and Orders are wrongful deprivation of, the property rights Constitutional. of those affected thereby, and that PPA-AO 04-92 does not forbid, but merely regulates, HELD: the exercise by harbor pilots of their profession. As will be presently NO. Said order is Unconstitutional. The Court demonstrated, such supposition is gravely is convinced that PPA-AO No. 04-92 was erroneous and tends to perpetuate an issued in stark disregard of respondents administrative order which is not only right against deprivation of property without unreasonable but also superfluous. due process of law. Consequently, the instant petition must be denied. In order to fall within the aegis of this provision (due process), two conditions must concur, namely, (1) That there is a deprivation and (2) 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 EASTERN SHIPPING LINES, INC. vs. CA the method or manner by which the law is enforced, while substantive due process G.R. No. 116356 June 29, 1998 requires that the law itself, not merely the procedures by which the law would be FACTS: enforced, is fair, reasonable, and just. PPA-AO No. 04-92 must be examined in light of this Respondent elevated a complaint against distinction. petitioner for unpaid fees for pilotage service rendered. Despite repeated demands, As a general rule, notice and hearing, as petitioner failed to pay and prays be directed the fundamental requirements of procedural to pay with legal rate of interest from the due process, are essential only when an filing of the complaint and other such other administrative body exercises its quasi- relief. The petitioner assailed judicial function. In the performance of its the constitutionality of the EO 1088 upon provisions. The PPA may increase the rates which respondent based its claims. Petitioner but it may not decrease them below those insists that it should pay pilotage fees in mandated by E.O. No. 1088 accordance with and on the basis of the It is axiomatic that an administrative memorandum circulars issued by the PPA, agency, like the PPA, has no discretion whether to the administrative body vested under PD implement the law or not. Its duty is to enforce it. 857. The trial court directed the petitioner Unarguably, therefore, if there is any conflict between the PPA circular and a law, such as EO to pay respondent on sum of unpaid pilotage 1088, the latter prevails. fees, legal rate of interest, attorney's fees and costs. The trial court added that the factual antecedents of the controversy are simple; the petitioner insists on paying the fees prescribed under PPA circulars because EO 1088 sets a higher rate, petitioner then assailed its constitutionality. The Court of Appeals affirmed the trial courts decision in toto. Hence, the petition.
ISSUE:
WON EO 1088 is valid and constitutional.
HELD:
Yes. 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; 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. 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. We conclude JOSE D. LINA, JR., petitioner, vs. that E.O. No. 1088 is a valid statute and that ISIDRO D. CARINO, in his capacity as the PPA is duty bound to comply with its Secretary of Education, Culture and Sports, On the other hand, the Solicitor General, respondents. representing respondent Secretary, maintains that the power to prescribe maximum tuition and FACTS: other school fees granted under B.P. Blg: 232 was not withdrawn by R.A. No. 6728 and remains vested in the DECS Secretary. The Solicitor A Petition for Prohibition and Mandamus filed was General further contends that DECS Order No. 30 by petitioner Senator Jose D. Lina, Jr., principally conforms substantially with the consultation as taxpayer, against respondent Isidro D. Cario, requirement of R.A. No. 672B, except item 1 (a) of in the latter's capacity as the then Secretary of DECS Order No. 30 which unqualifiedly allows the Department of Education, Culture & Sports private colleges and universities to raise the ("DECS"). Petitioner disputes the legal authority tuition fee in the tertiary level to not more than P80.00 per unit without prior consultation. He of respondent Cario to issue DECS Order No. 30 therefore urges that DECS Order No. 30 be entitled "Guidelines on Tuition and/or other upheld, save only paragraph 1(a) thereof which School Fees in Private Schools, Colleges and he considers to be inconsistent with the Universities for School Year 1991-1992." DECS consultation requirement. Order No. 30 allows private schools to increase tuition and other school fees, subject to the ISSUE: guidelines there set out. Tuition fee increases within the prescribed rates shall not require WON DECS Order No. 30 is valid, that is, whether consultation and DECS approval provided that a respondent DECS Secretary has the legal authority to issue DECS Order No. 30 prescribing notice of increase is submitted to the DECS guidelines concerning increases in tuition and regional office not later than April 30, 1991. other school fees Schools may increase up to a maximum rate of 25% for programs below Level II accreditation HELD: and up to a maximum of 30% for programs with Level II and Level III accreditation based on YES. After careful examination of the provisions approved tuition fee rates in school year 1990- of both P.D. No. 451 and BP. Blg. 232, as well the 1991, subject to consultation. lengthy pleadings filed by the parties and the intervenors, the Court considers that the legal authority of respondent DECS Secretary to set Petitioner basically denies the legal maximum permissible rates or levels of tuition authority of respondent Secretary to issue DECS and other school fees, and to issue guidelines for Order No. 30. It is the contention of petitioner the imposition and collection thereof, like DECS that respondent Secretary at the time of issuing Order No. 30, must be sustained. DECS Order No. 30, no longer possessed legal authority to do so, considering that authority to We turn to the argument of petitioner Lina that promulgate rules and regulations relating to the the DECS Secretary was divested of his authority to promulgate rules and regulations relating to imposition of school fees had been transferred to the fixing of tuition and other school fees, by R.A. the State Assistance Council ("SAC") by Republic No. 6728, and that such authority has been Act No. 6728. Petitioner also contends that DECS transferred instead to the SAC. The Court is Order No. 30 is inconsistent with Section 10 of unable to agree with this contention. We do not R.A. No. 6728. In DECS Order No. 30 respondent see how R.A. No. 6728 could be regarded as Secretary exempted increases in school fees vesting upon the SAC the legal authority to other than tuition fee (or "other school fees" as establish maximum permissible tuition and other school fees for private schools. As earlier noted, distinguished from "tuition fee") from application R.A. No. 6728 deals with government assistance of the consultation requirement. According to to students and teachers in private schools; it petitioner, Section 10 above notwithstanding its does not, in other words, purport to deal at all wording, covers increases in all types of school with the question of authority to fix maximum fees, which increases must first comply with the collectible tuition and other school fees. R.A. No, requirement of consultation before promulgation 6728 did authorize the SAC to issue rules and in order that prohibitive and burdensome fees (of regulations; but the rules and regulations which may be promulgated by the SAC must relate to any type) may be avoided. the authority granted by R.A. No. 6728 to the specification of such levels of tuition and other SAC. It is axiomatic that a rule or regulation must school fees for purposes of qualifying (or bear upon, and be consistent with, the provisions disqualifying) the students in such schools for of the enabling statute if such rule or regulation is government financial assistance is one thing; this to be valid. The SAC was authorized to define the is the task SAC was authorized to carry out classes of students who may be entitled to claim though the promulgation of rules and regulations. government financial assistance. Under the The determination of the levels of tuition and statute, students of schools charging tuition and other school fees which may lawfully be charged other school fees in excess of certain identified by any private school, is clearly another matter; rates or levels thereof shall not be entitled to this task is vested in respondent Secretary. claim government assistance or subsidies. The