ADMIN LAW

Title: Liban v. Gordon G.R. No. 175352

Date: January 18, 2011
Ponente: Carpio, J.
DANTE V. LIBAN, REYNALDO M. BERNARDO, and
RICHARD J. GORDON,
SALVADOR M. VIARI,
Respondent
Petitioners
FACTS
 Petitioners Liban, et al., who were officers of the Board of Directors of the Quezon City Red Cross Chapter, filed with
the Supreme Court what they styled as “Petition to Declare Richard J. Gordon as Having Forfeited His Seat in the
Senate” against respondent Gordon, who was elected Chairman of the Philippine National Red Cross (PNRC) Board of
Governors during his incumbency as Senator.
 Petitioners alleged that by accepting the chairmanship of the PNRC Board of Governors, respondent Gordon ceased
to be a member of the Senate pursuant to Sec. 13, Article VI of the Constitution, which provides that “[n]o Senator . .
. may hold any other office or employment in the Government, or any subdivision, agency, or instrumentality thereof,
including government-owned or controlled corporations or their subsidiaries, during his term without forfeiting his
seat.” Petitioners cited the case of Camporedondo vs. NLRC, G.R. No. 129049, decided August 6, 1999, which held that
the PNRC is a GOCC, in supporting their argument that respondent Gordon automatically forfeited his seat in the
Senate when he accepted and held the position of Chairman of the PNRC Board of Governors.
 Formerly, in its Decision dated July 15, 2009, the Court, voting 7-5,[1] held that the office of the PNRC Chairman is
NOT a government office or an office in a GOCC for purposes of the prohibition in Sec. 13, Article VI of the 1987
Constitution. The PNRC Chairman is elected by the PNRC Board of Governors; he is not appointed by the President or
by any subordinate government official. Moreover, the PNRC is NOT a GOCC because it is a privately-owned, privately-
funded, and privately-run charitable organization and because it is controlled by a Board of Governors four-fifths of
which are private sector individuals. Therefore, respondent Gordon did not forfeit his legislative seat when he was
elected as PNRC Chairman during his incumbency as Senator.
 The Court however held further that the PNRC Charter, R.A. 95, as amended by PD 1264 and 1643, is void insofar as
it creates the PNRC as a private corporation since Section 7, Article XIV of the 1935 Constitution states that “[t]he
Congress shall not, except by general law, provide for the formation, organization, or regulation of private
corporations, unless such corporations are owned or controlled by the Government or any subdivision or
instrumentality thereof.” The Court thus directed the PNRC to incorporate under the Corporation Code and register
with the Securities and Exchange Commission if it wants to be a private corporation. The fallo of the Decision read:
o WHEREFORE, we declare that the office of the Chairman of the Philippine National Red Cross is not a government
office or an office in a government-owned or controlled corporation for purposes of the prohibition in Section 13,
Article VI of the 1987 Constitution. We also declare that Sections 1, 2, 3, 4(a), 5, 6, 7, 8, 9, 10, 11, 12, and 13 of
the Charter of the Philippine National Red Cross, or Republic Act No. 95, as amended by Presidential Decree Nos.
1264 and 1643, are VOID because they create the PNRC as a private corporation or grant it corporate powers.
 Respondent Gordon filed a Motion for Clarification and/or for Reconsideration of the Decision. The PNRC likewise
moved to intervene and filed its own Motion for Partial Reconsideration. They basically questioned the second part of
the Decision with regard to the pronouncement on the nature of the PNRC and the constitutionality of some provisions
of the PNRC Charter.
ISSUE/S
Whether or not it was correct for the Court to have passed upon and decided on the issue of the constitutionality of the
PNRC charter? NO
RATIO
 The Court GRANTED reconsideration and MODIFIED the dispositive portion of the Decision by deleting the second
sentence thereof.
 It was not correct for the Court to have decided on the constitutional issue because it was not the very lis mota of the
case. The PNRC is sui generis in nature; it is neither strictly a GOCC nor a private corporation.
 The issue of constitutionality of R.A. No. 95 was not raised by the parties, and was not among the issues defined in the
body of the Decision; thus, it was not the very lis mota of the case. We have reiterated the rule as to when the Court
will consider the issue of constitutionality in Alvarez v. PICOP Resources, Inc., thus:
o This Court will not touch the issue of unconstitutionality unless it is the very lis mota. It is a well-established rule
that a court should not pass upon a constitutional question and decide a law to be unconstitutional or invalid,
 unless such question is raised by the parties and that when it is raised, if the record also presents some other
ground upon which the court may [rest] its judgment, that course will be adopted and the constitutional question
will be left for consideration until such question will be unavoidable.
 [T]his Court should not have declared void certain sections of . . . the PNRC Charter. Instead, the Court should have
exercised judicial restraint on this matter, especially since there was some other ground upon which the Court could
have based its judgment. Furthermore, the PNRC, the entity most adversely affected by this declaration of
unconstitutionality, which was not even originally a party to this case, was being compelled, as a consequence of the
Decision, to suddenly reorganize and incorporate under the Corporation Code, after more than sixty (60) years of
existence in this country.
 Since its enactment, the PNRC Charter was amended several times, particularly on June 11, 1953, August 16, 1971,
December 15, 1977, and October 1, 1979, by virtue of R.A. No. 855, R.A. No. 6373, P.D. No. 1264, and P.D. No. 1643,
respectively. The passage of several laws relating to the PNRC’s corporate existence notwithstanding the effectivity
of the constitutional proscription on the creation of private corporations by law is a recognition that the PNRC is not
strictly in the nature of a private corporation contemplated by the aforesaid constitutional ban.
 A closer look at the nature of the PNRC would show that there is none like it[,] not just in terms of structure, but also
in terms of history, public service and official status accorded to it by the State and the international community.
There is merit in PNRC’s contention that its structure is sui generis. It is in recognition of this sui generis character of
the PNRC that R.A. No. 95 has remained valid and effective from the time of its enactment in March 22, 1947 under
the 1935 Constitution and during the effectivity of the 1973 Constitution and the 1987 Constitution. The PNRC Charter
and its amendatory laws have not been questioned or challenged on constitutional grounds, not even in this case
before the Court now.
 [T]his Court [must] recognize the country’s adherence to the Geneva Convention and respect the unique status of the
PNRC in consonance with its treaty obligations. The Geneva Convention has the force and effect of law. Under the
Constitution, the Philippines adopts the generally accepted principles of international law as part of the law of the
land. This constitutional provision must be reconciled and harmonized with Article XII, Section 16 of the Constitution,
instead of using the latter to negate the former. By requiring the PNRC to organize under the Corporation Code just
like any other private corporation, the Decision of July 15, 2009 lost sight of the PNRC’s special status under
international humanitarian law and as an auxiliary of the State, designated to assist it in discharging its obligations
under the Geneva Conventions.
 The PNRC, as a National Society of the International Red Cross and Red Crescent Movement, can neither “be classified
as an instrumentality of the State, so as not to lose its character of neutrality” as well as its independence, nor strictly
as a private corporation since it is regulated by international humanitarian law and is treated as an auxiliary of the
State.
 Although [the PNRC] is neither a subdivision, agency, or instrumentality of the government, nor a GOCC or a subsidiary
thereof . . . so much so that respondent, under the Decision, was correctly allowed to hold his position as Chairman
thereof concurrently while he served as a Senator, such a conclusion does not ipso facto imply that the PNRC is a
“private corporation” within the contemplation of the provision of the Constitution, that must be organized under the
Corporation Code. [T]he sui generis character of PNRC requires us to approach controversies involving the PNRC on
a case-to-case basis.
 In sum, the PNRC enjoys a special status as an important ally and auxiliary of the government in the humanitarian field
in accordance with its commitments under international law. This Court cannot all of a sudden refuse to recognize its
existence, especially since the issue of the constitutionality of the PNRC Charter was never raised by the parties. It
bears emphasizing that the PNRC has responded to almost all national disasters since 1947, and is widely known to
provide a substantial portion of the country’s blood requirements. Its humanitarian work is unparalleled. The Court
should not shake its existence to the core in an untimely and drastic manner that would not only have negative
consequences to those who depend on it in times of disaster and armed hostilities but also have adverse effects on
the image of the Philippines in the international community. The sections of the PNRC Charter that were declared void
must therefore stay. Thus, R.A. No. 95 remains valid and constitutional in its entirety.
RULING
WHEREFORE, we declare that the office of the Chairman of the Philippine National Red Cross is not a government office
or an office in a government-owned or controlled corporation for purposes of the prohibition in Section 13, Article VI of
the 1987 Constitution. We also declare that Sections 1, 2, 3, 4(a), 5, 6, 7, 8, 9, 10, 11, 12, and 13 of the Charter of the
Philippine National Red Cross, or Republic Act No. 95, as amended by Presidential Decree Nos. 1264 and 1643, are VOID
because they create the PNRC as a private corporation or grant it corporate powers.
(SANTOS, 2B 2017-2018)