Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 160596 March 20, 2009

REPUBLIC OF THE PHILIPPINES, represented by the Office of the Ombudsman, Petitioner,

vs.
IGNACIO BAJAO, Respondent**

DECISION

AUSTRIA-MARTINEZ, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing
the May 22, 2003 Decision1 of the Court of Appeals (CA) which reversed the September 27, 2001
Decision2 of the Office of the Deputy Ombudsman for the Visayas (Ombudsman) in OMB-VIS-ADM-
2000-0854, and the October 13, 2003 CA Resolution3 which denied the Ombudsman’s Motion for
Reconsideration.

The relevant facts are as follows:

On the basis of a Complaint4 filed by Candijay, Bohol Municipal Vice-Mayor Antonio L. Po

and Sangguniang Bayan Members Deodoro G. Hinacay, Gaspar G. Amora, Philbert H. Bertumen,
Leonardo A. Tutor, Peregrine Castrodes and Sergio G. Amora, Jr. (complainants) against Municipal
Treasurer Ignacio Bajao (respondent) for Failure to Make Delivery of Public Funds punishable under
Article 221 of the Revised Penal Code and Section 3(F) of Republic Act (R.A.) No. 3019, and for Grave
Abuse of Authority in relation to respondent's withholding of complainants' uniform allowance for 1999,
the Office of the Ombudsman (Visayas) issued a decision, the dispositive portion of which reads:

IN VIEW OF ALL THE FOREGOING, after finding respondent to be administratively liable for Simple
MISCONDUCT a penalty of one (1) month suspension from office without pay is hereby imposed, with
a warning that a repetition of the same act will be dealt with more severely.

SO ORDERED.5

The Ombudsman also issued an Order dated January 14, 2002, directing the immediate
implementation of its decision pursuant to Administrative Order No. 14, dated July 30, 2000, amending
Rule III of Administrative Order No. 07 (Rules of Procedure of the Office of the Ombudsman) which
provides that a penalty not exceeding one month suspension is final and unappealable.6

Respondent filed with the CA a Special Civil Action for Certiorari and an Amended Petition for Special
Civil Action for Certiorari under Rule 65 of the Rules of Court. Respondent disputed the factual basis
of the Ombudsman decision as well as its authority to directly impose a penalty of suspension, arguing
that the Ombudsman may only recommend to the proper disciplining authority the implementation of
such penalty.7

The Ombudsman itself, through the Solicitor General, filed a Comment8 and
Memorandum,9 maintaining that its decision to suspend respondent is valid under the facts
established.

The CA issued a Temporary Restraining Order against the implementation of the Ombudsman
decision.10Thereafter, it rendered the May 22, 2003 Decision assailed herein, declaring that the
Ombudsman exceeded its authority in penalizing respondent. According to the CA, the Constitution
itself and R.A. No. 6770 or the Ombudsman Act of 1989, limit the authority of the Ombudsman in
administrative cases to recommending the appropriate penalty to be imposed on an erring public
official or employee, leaving the adoption and enforcement of the recommended penalty to the
discretion of the immediate disciplining authority. The CA elaborated:

Paragraph 3, Section 13, Article XI of the Constitution dealing specifically on the power of the
Ombudsman, provides:
(3) Direct the officer concerned to take appropriate action against a public official or employee at fault,
and recommend his removal, suspension, demotion, fine, censure, or prosecution, and ensure
compliance therewith.

In conjunction thereto, Section 12 of Article XI states:

Sec. 12. The Ombudsman and his Deputies, as protectors of the people, shall act promptly on
complaints filed in any form or manner against public officials or employees of the Government, or any
subdivision, agency or instrumentality thereof, including government-owned or controlled corporations,
and shall, in appropriate cases, notify the complainants of the action taken and the result thereof.

We must give Our assent to the stand of petitioner that the operative phrase in Paragraph 3, Section
13, Article XI, is "to recommend". The word "recommend" has been defined by Black's Law Dictionary
as "an action which is advisory in nature rather than one having any binding effect."11

xxxx

Even under the Ombudsman Act of 1989, wherein the Legislature sought to put more teeth, so to
speak, to the Office of the Ombudsman, it may be gleaned from the language of the law that punitive
prerogatives have still be withheld from the Ombudsman in so far as the official complained against is
concerned. Paragraph 3 of Section 15 of the said law reads:

Sec. 15. Powers, Functions and Duties. – The Office of the Ombudsman shall have the following
powers, functions and duties:

[x x x x]

(3) Direct the officer concerned to take appropriate action against a public officer or employee at fault
or who neglects to perform an act or discharge a duty required by law, and recommend his removal,
suspension, demotion, fine, censure, or prosecution, and ensure compliance therewith; or enforce its
disciplinary authority as provided in Section 21 of this Act: Provided, That the refusal by any officer
without just cause to comply with an order of the Ombudsman to remove, suspend, demote, fine,
censure, or prosecute an officer or employee who is at fault or who neglects to perform an act or
discharge a duty required by law shall be a ground for disciplinary action against said officer;
(Emphasis supplied)

xxxx

Thus, even Republic Act No. 6770 recognizes that the power of the Ombudsman to adjudicate penalty
after investigation is merely recommendatory or suggestive, for otherwise, the law would not have to
provide for the Ombudsman to first go to the disciplining authority and direct the latter to take
appropriate action against the erring government functionary. This is as it should be. For to give it a
contrary construction would be productive of nothing but mischief, such being at war with the explicit
language of the Fundamental Law. As the spring cannot rise higher than its source, neither can a
statute be at variance with the Constitution.

xxxx

Indeed, the Supreme Court in Tapiador v. Office of the Ombudsman, per Justice Sabino de Leon,
stated, albeit in an obiter dictum, that "(b)esides, assuming that petitioner were administratively liable,
the Ombudsman has no authority to directly dismiss the petitioner from the government service, more
particularly from his position in the BID. Under Section 13, subparagraph (3), of Article XI of the 1987
Constitution, the Ombudsman can only 'recommend' the removal or the public official or employee
found to be at fault, to the public official concerned.

In fine, We find, and so hold, that the Office of the Ombudsman has only the power to investigate
possible misconduct of a government official or employee in the performance of his functions, and
thereafter recommend to the disciplining authority the appropriate penalty to be meted out, and that it
is the disciplining authority that has the power or prerogative to impose such penalty.12

The CA further absolved respondent of the offense of simple misconduct in view of findings that
respondent was justified in withholding complainants' uniform allowance for lack of authorization from
the municipal mayor for the release of said funds as required under the Local Government Code and
its implementing rules, as well as Local Budget Circular No. 68 of the Department of Budget and
Management.13 The dispositive portion of the CA Decision reads:
WHEREFORE, the Petition is hereby GRANTED. The impugned Order [sic] of the Office of the
Ombudsman, having been issued without grave abuse of discretion amounting to excess of
jurisdiction, hereby ANNULLED AND SET ASIDE.

SO ORDERED.14

The Ombudsman's motion for reconsideration was denied by the CA.15

On its own, the Ombudsman filed a Petition for Review on Certiorari16 with the Court but the same
was denied for having been filed out of time.17

Through the Solicitor General, the Ombudsman filed the present petition which the Court initially
denied, also for having been filed out of time; but upon motion for reconsideration by the Ombudsman,
the petition was eventually given due course per its Resolution dated April 12, 2004.18

The claim of respondent -- that the present petition is barred by the Ombudsman prior petition (G.R.
No. 160501), which was dismissed -- is not plausible. Suffice it to state that the Court gave due course
to the present petition, for it raises highly meritorious arguments, dealing with the undue diminution of
the constitutionally mandated investigatory power of the Ombudsman, against which the Ombudsman
must be accorded every opportunity to defend itself;19 and that the assailed decision of the CA is
blatantly erroneous.20

Exactly the same issues raised in the petition, to wit:

Is the Office of the Ombudsman empowered to conduct administrative adjudication proceedings

against public officers over whom it has jurisdiction?

II

Are orders/decisions of the Office of the Ombudsman imposing the penalty of suspension of one month
appealable?21

have long been resolved by the Court in Office of the Ombudsman v. Court of Appeals and
Armilla,22 Office of theOmbudsman v. Court of Appeals and Santos,23 and Herrera v. Bohol.24

In Office of the Ombudsman v. Court of Appeals and Armilla, therein respondents Armilla, all
employees of the Department of Environment and Natural Resources, were found by the Ombudsman
administratively liable for simple misconduct and meted the penalty of suspension for one month. On
petition for certiorari filed by Armilla, et al., the CA held that the Ombudsman committed grave abuse
of discretion in imposing the penalty of one-month suspension. Citing Tapiador v. Office of the
Ombudsman,25 the CA declared that the Ombudsman’s power in administrative cases is limited to the
recommendation of the penalty of removal, suspension, demotion, fine, censure, or prosecution of a
public officer or employee found to be at fault; accordingly, it has no power to impose the penalty of
suspension on Armilla, et al.

The CA adopted the same view in Office of the Ombudsman v. Court of Appeals and Santos where it
held that the Ombudsman had no authority to directly penalize therein respondent Lorena Santos, but
may only recommend to her agency, the Land Transportation Franchising and Regulatory Board, the
imposition of an administrative penalty against her.

In both cases, the Court reversed the CA and declared that the scope of the authority of the
Ombudsman in administrative cases as defined under the Constitution and R.A. No. 6770 is broad
enough to include the direct imposition of the penalty of removal, suspension, demotion, fine or
censure on an erring public official or employee. In Office of the Ombudsman v. Court of Appeals and
Armilla, the Court held:

Still in connection with their administrative disciplinary authority, the Ombudsman and his deputies are
expressly given the power to preventively suspend public officials and employees facing administrative
charges in accordance with Section 24 of Republic Act No. 6770:

Sec. 24. Preventive Suspension. - The Ombudsman and his Deputy may preventively suspend any
officer or employee under his authority pending an investigation, if in his judgment the evidence of guilt
is strong, and (a) the charge against such officer or employee involves dishonesty, oppression or grave
misconduct, or neglect in the performance of duty; (b) the charges would warrant removal from the
service; or (c) the respondent's continued stay in office may prejudice the case filed against him.

The preventive suspension shall continue until the case is terminated by the Office of the Ombudsman
but not more than six months, without pay, except when the delay in the disposition of the case by the
Office of the Ombudsman is due to the fault, negligence or petition of the respondent, in which case
the period of such delay shall not be counted in computing the period of suspension herein provided.

Section 25 thereof sets forth the penalties as follows:

Sec. 25. Penalties. - (1) In administrative proceedings under Presidential Decree No. 807, the
penalties and rules provided therein shall be applied.

(2) In other administrative proceedings, the penalty ranging from suspension without pay for one year
to dismissal with forfeiture of benefits or a fine ranging from five thousand pesos (P5,000.00) to twice
the amount malversed, illegally taken or lost, or both at the discretion of the Ombudsman, taking into
consideration circumstances that mitigate or aggravate the liability of the officer or employee found
guilty of the complaint or charges.

As referred to in the above provision, under Presidential Decree No. 807,[32] the penalties that may
be imposed by the disciplining authority in administrative disciplinary cases are removal from the
service, transfer, demotion in rank, suspension for not more than one year without pay, fine in an
amount not exceeding six months' salary, or reprimand.

Section 27 of Republic Act No. 6770 provides for the period of effectivity and finality of the decisions
of the Office of the Ombudsman:

Sec. 27. Effectivity and Finality of Decisions. - (1) All provisionary orders of the Office of the
Ombudsman are immediately effective and executory.

xxxx

Findings of facts by the Office of the Ombudsman when supported by substantial evidence are
conclusive. Any order, directive or decision imposing the penalty of public censure or reprimand,
suspension of not more than one month's salary shall be final and unappealable.

xxxx

All these provisions in Republic Act No. 6770 taken together reveal the manifest intent of the
lawmakers to bestow on the Office of the Ombudsman full administrative disciplinary authority.
These provisions cover the entire gamut of administrative adjudication which entails the
authority to, inter alia, receive complaints, conduct investigations, hold hearings in accordance
with its rules of procedure, summon witnesses and require the production of documents, place
under preventive suspension public officers and employees pending an investigation,
determine the appropriate penalty imposable on erring public officers or employees as
warranted by the evidence, and, necessarily, impose the said penalty.

Moreover, in Office of the Ombudsman v. Court of Appeals and Santos, the Court drew attention to
subparagraph 3 of Sec. 15 of R.A. No. 6770, which provides:

Sec. 15. Powers, Functions and Duties. – The Office of the Ombudsman shall have the following
powers, functions and duties:

xxxx

(3) Direct the officer concerned to take appropriate action against a public officer or employee at fault
or who neglects to perform an act or discharge a duty required by law, and recommend his removal,
suspension, demotion, fine, censure, or prosecution, and ensure compliance therewith; or enforce its
disciplinary authority as provided in Section 21 of this Act: Provided, That the refusal by any officer
without just cause to comply with an order of the Ombudsman to remove, suspend, demote,
fine, censure, or prosecute an officer or employee who is at fault or who neglects to perform
an act or discharge a duty required by law shall be a ground for disciplinary action against said
officer. (Emphasis supplied)
The Court held that the aforecited proviso -- that the refusal, without just cause, of any officer to comply
with an order of the Ombudsman to penalize an erring officer or employee with removal, suspension,
demotion, fine, censure, or prosecution is a ground for disciplinary action against said officer -- is a
strong indication that the Ombudsman’s "recommendation" is not merely advisory in nature but is
actually mandatory within the bounds of law.

It being settled that the Ombudsman has the authority to impose administrative penalties, it did not act
with grave abuse of discretion in the present case when it meted the penalty of suspension on
respondent for simple misconduct. The CA therefore erred in granting the petition for certiorari of
respondent.

The next issue is whether the imposition of such penalty can no longer be appealed to the CA.

The Court had occasion to resolve the same issue in Herrera v. Bohol.26 In said case, the Ombudsman
found therein petitioner Herrera guilty of simple misconduct and imposed upon him the penalty of
suspension for one month without pay. Herrera filed an appeal with the CA, but the same was
dismissed on the ground "that the questioned decision of the Ombudsman is unappealable x x x."
Citing Lopez v. Court of Appeals,27 the Court affirmed the decision of the CA, thus:

x x x [T]he Court, again citing Sec. 27 of R.A. No. 6770, Sec. 7, Rule III of the Rules of Procedure of
the Office of the Ombudsman and Lapid v. Court of Appeals, reiterated that decisions of the
Ombudsman in administrative cases imposing the penalty of public censure, reprimand, or suspension
of not more than one month, or a fine equivalent to one month salary shall be final and
unappealable. The penalty imposed upon herein petitioner being suspension for one month
without pay, we hold the same final and unappealable, as correctly ruled by the Court of
Appeals. (Emphasis added)

Thus, the CA erred when it reviewed on appeal the factual basis of the Ombudsman decision despite
its being final and unappealable under Sec. 27 of R.A. No. 6770. As we held in Republic v.
Francisco,28 considering that a decision of the Ombudsman imposing the penalty of suspension for
not more than one month is final and unappealable, "it follows that the CA ha[s] no appellate jurisdiction
to review, rectify or reverse the same." This is not to say that decisions of the Ombudsman cannot be
questioned – such decisions are still subject to the test of arbitrariness or grave abuse of discretion
through a petition for certiorari under Rule 65 of the Rules of Court. However, as earlier discussed,
the Ombudsman did not act with grave abuse of discretion in imposing on respondent the penalty of
suspension without pay for not more than one month, the same being within its ample authority to
impose under the Constitution and R.A. No. 6770.

WHEREFORE, the petition is GRANTED. The May 22, 2003 Decision and October 13, 2003
Resolution of the Court of Appeals are REVERSED and SET ASIDE.

No costs.

SO ORDERED.

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 98332 January 16, 1995

MINERS ASSOCIATION OF THE PHILIPPINES, INC., petitioner,

vs.
HON. FULGENCIO S. FACTORAN, JR., Secretary of Environment and Natural Resources, and
JOEL D. MUYCO, Director of Mines and Geosciences Bureau, respondents.

ROMERO, J.:

The instant petition seeks a ruling from this Court on the validity of two Administrative Orders issued
by the Secretary of the Department of Environment and Natural Resources to carry out the provisions
of certain Executive Orders promulgated by the President in the lawful exercise of legislative powers.

Herein controversy was precipitated by the change introduced by Article XII, Section 2 of the 1987
Constitution on the system of exploration, development and utilization of the country's natural
resources. No longer is the utilization of inalienable lands of public domain through "license,
concession or lease" under the 1935 and 1973 Constitutions1 allowed under the 1987 Constitution.

The adoption of the concept of jura regalia 2 that all natural resources are owned by the State
embodied in the 1935, 1973 and 1987 Constitutions, as well as the recognition of the importance of
the country's natural resources, not only for national economic development, but also for its security
and national
defense, 3 ushered in the adoption of the constitutional policy of "full control and supervision by the
State" in the exploration, development and utilization of the country's natural resources. The options
open to the State are through direct undertaking or by entering into co-production, joint venture; or
production-sharing agreements, or by entering into agreement with foreign-owned corporations for
large-scale exploration, development and utilization.

Article XII, Section 2 of the 1987 Constitution provides:

Sec. 2. All lands of the public domain, waters, minerals, coal, petroleum, and other
mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and
fauna, and other natural resources are owned by the State. With the exception of
agricultural lands, all other natural resources shall not be alienated. The exploration,
development, and utilization of natural resources shall be under the full control and
supervision of the State. The State may directly undertake such activities, or it may
enter into co-production, joint venture, or product-sharing agreements with Filipino
citizens, or corporations or associations at least sixty per centum of whose capital is
owned by such citizens. Such agreements may be for a period not exceeding twenty-
five years, renewable for not more than twenty-five years, and under such terms and
conditions as may be provided by law. In cases of water rights for irrigation, water
supply, fisheries, or industrial uses other than the development of water power,
beneficial use may be the measure and limit of the grant.

xxx xxx xxx

The President may enter into agreements with foreign-owned corporations involving
either technical or financial assistance for large-scale exploration, development, and
utilization of minerals, petroleum, and other mineral oils according to the general terms
and conditions provided by law, based on real contributions to the economic growth
and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources.

The President shall notify the Congress of every contract entered into in accordance
with this provision, within thirty days from its execution. (Emphasis supplied)
Pursuant to the mandate of the above-quoted provision, legislative acts 4 were successively issued by
the President in the exercise of her legislative
power. 5

To implement said legislative acts, the Secretary of the Department of Environment and Natural
Resources (DENR) in turn promulgated Administrative Order Nos. 57 and 82, the validity and
constitutionality of which are being challenged in this petition.

On July 10, 1987, President Corazon C. Aquino, in the exercise of her then legislative powers under
Article II, Section 1 of the Provisional Constitution and Article XIII, Section 6 of the 1987 Constitution,
promulgated Executive Order No. 211 prescribing the interim procedures in the processing and
approval of applications for the exploration, development and utilization of minerals pursuant to the
1987 Constitution in order to ensure the continuity of mining operations and activities and to hasten
the development of mineral resources. The pertinent provisions read as follows:

Sec. 1. Existing mining permits, licenses, leases and other mining grants issued by the
Department of Environment and Natural Resources and Bureau of Mines and Geo-
Sciences, including existing operating agreements and mining service contracts, shall
continue and remain in full force and effect, subject to the same terms and conditions
as originally granted and/or approved.

Sec. 2. Applications for the exploration, development and utilization of mineral

resources, including renewal applications for approval of operating agreements and
mining service contracts, shall be accepted and processed and may be approved;
concomitantly thereto, declarations of locations and all other kinds of mining
applications shall be accepted and registered by the Bureau of Mines and Geo-
Sciences.

Sec. 3. The processing, evaluation and approval of all mining applications,

declarations of locations, operating agreements and service contracts as provided for
in Section 2 above, shall be governed by Presidential Decree No. 463, as amended,
other existing mining laws and their implementing rules and regulations: Provided,
however, that the privileges granted, as well as the terms and conditions thereof shall
be subject to any and all modifications or alterations which Congress may adopt
pursuant to Section 2, Article XII of the 1987 Constitution.

On July 25, 1987, President Aquino likewise promulgated Executive Order No. 279 authorizing the
DENR Secretary to negotiate and conclude joint venture, co-production, or production-sharing
agreements for the exploration, development and utilization of mineral resources, and prescribing the
guidelines for such agreements and those agreements involving technical or financial assistance by
foreign-owned corporations for large-scale exploration, development, and utilization of minerals. The
pertinent provisions relevant to this petition are as follows:

Sec. 1. The Secretary of the Department of Environment and Natural Resources

(hereinafter referred to as "the Secretary") is hereby authorized to negotiate and enter
into, for and in behalf of the Government, joint venture, co-production, or production-
sharing agreements for the exploration, development, and utilization of mineral
resources with any Filipino citizens, or corporation or association at least sixty percent
(60%) of whose capital is owned by Filipino citizens. Such joint venture, co-production,
or production-sharing agreements may be for a period not exceeding twenty-five years,
renewable for not more than twenty-five years, and shall include the minimum terms
and conditions prescribed in Section 2 hereof. In the execution of a joint venture, co-
production or production agreements, the contracting parties, including the
Government, may consolidate two or more contiguous or geologically — related mining
claims or leases and consider them as one contract area for purposes of determining
the subject of the joint venture, co-production, or production-sharing agreement.

xxx xxx xxx

Sec. 6. The Secretary shall promulgate such supplementary rules and regulations as
may be necessary to effectively implement the provisions of this Executive Order.

Sec. 7. All provisions of Presidential Decree No. 463, as amended, other existing
mining laws, and their implementing rules and regulations, or parts thereof, which are
not inconsistent with the provisions of this Executive Order, shall continue in force and
effect.
Pursuant to Section 6 of Executive Order No. 279, the DENR Secretary issued on June 23, 1989
DENR Administrative Order No. 57, series of 1989, captioned "Guidelines of Mineral Production
Sharing Agreement under Executive Order No. 279." 6 Under the transitory provision of said DENR
Administrative Order No. 57, embodied in its Article 9, all existing mining leases or agreements which
were granted after the effectivity of the 1987 Constitution pursuant to Executive Order No. 211, except
small scale mining leases and those pertaining to sand and gravel and quarry resources covering an
area of twenty (20) hectares or less, shall be converted into production-sharing agreements within one
(1) year from the effectivity of these guidelines.

On November 20, 1980, the Secretary of the DENR Administrative Order No. 82, series of 1990, laying
down the "Procedural Guidelines on the Award of Mineral Production Sharing Agreement (MPSA)
through Negotiation." 7

Section 3 of the aforementioned DENR Administrative Order No. 82 enumerates the persons or
entities required to submit Letter of Intent (LOIs) and Mineral Production Sharing Agreement (MPSAs)
within two (2) years from the effectivity of DENR Administrative Order No. 57 or until July 17, 1991.
Failure to do so within the prescribed period shall cause the abandonment of mining, quarry and sand
and gravel claims. Section 3 of DENR Administrative Order No. 82 provides:

Sec. 3. Submission of Letter of Intent (LOIs) and MPSAs). The following shall submit
their LOIs and MPSAs within two (2) years from the effectivity of DENR A.O. 57 or until
July 17, 1991.

i. Declaration of Location (DOL) holders, mining lease applicants, exploration

permitees, quarry applicants and other mining applicants whose mining/quarry
applications have not been perfected prior to the effectivity of DENR Administrative
Order No. 57.

ii. All holders of DOL acquired after the effectivity of DENR A.O. No. 57.

iii. Holders of mining leases or similar agreements which were granted after (the)
effectivity of 1987 Constitution.

Failure to submit letters of intent and MPSA applications/proposals within the

prescribed period shall cause the abandonment of mining, quarry and sand and gravel
claims.

The issuance and the impeding implementation by the DENR of Administrative Order Nos. 57 and 82
after their respective effectivity dates compelled the Miners Association of the Philippines, Inc. 8 to file
the instant petition assailing their validity and constitutionality before this Court.

In this petition for certiorari, petitioner Miners Association of the Philippines, Inc. mainly contends that
respondent Secretary of DENR issued both Administrative Order Nos. 57 and 82 in excess of his rule-
making power under Section 6 of Executive Order No. 279. On the assumption that the questioned
administrative orders do not conform with Executive Order Nos. 211 and 279, petitioner contends that
both orders violate the
non-impairment of contract provision under Article III, Section 10 of the 1987 Constitution on the
ground that Administrative Order No. 57 unduly pre-terminates existing mining agreements and
automatically converts them into production-sharing agreements within one (1) year from its effectivity
date. On the other hand, Administrative Order No. 82 declares that failure to submit Letters of Intent
and Mineral Production-Sharing Agreements within two (2) years from the date of effectivity of said
guideline or on July 17, 1991 shall cause the abandonment of their mining, quarry and sand gravel
permits.

On July 2, 1991, the Court, acting on petitioner's urgent ex-parte petition for issuance of a restraining
order/preliminary injunction, issued a Temporary Restraining Order, upon posting of a P500,000.00
bond, enjoining the enforcement and implementation of DENR Administrative Order Nos. 57 and 82,
as amended, Series of 1989 and 1990, respectively. 9

On November 13, 1991, Continental Marble Corporation, 10 thru its President, Felipe A. David, sought
to intervene 11 in this case alleging that because of the temporary order issued by the Court , the
DENR, Regional Office No. 3 in San Fernando, Pampanga refused to renew its Mines Temporary
Permit after it expired on July 31, 1991. Claiming that its rights and interests are prejudicially affected
by the implementation of DENR Administrative Order Nos. 57 and 82, it joined petitioner herein in
seeking to annul Administrative Order Nos. 57 and 82 and prayed that the DENR, Regional Office No.
3 be ordered to issue a Mines Temporary Permit in its favor to enable it to operate during the pendency
of the suit.

Public respondents were acquired to comment on the Continental Marble Corporation's petition for
intervention in the resolution of November 28, 1991. 12

Now to the main petition. If its argued that Administrative Order Nos. 57 and 82 have the effect of
repealing or abrogating existing mining laws 13 which are not inconsistent with the provisions of
Executive Order No. 279. Invoking Section 7 of said Executive Order No. 279, 14 petitioner maintains
that respondent DENR Secretary cannot provide guidelines such as Administrative Order Nos. 57 and
82 which are inconsistent with the provisions of Executive Order No. 279 because both Executive
Order Nos. 211 and 279 merely reiterated the acceptance and registration of declarations of location
and all other kinds of mining applications by the Bureau of Mines and Geo-Sciences under the
provisions of Presidential Decree No. 463, as amended, until Congress opts to modify or alter the
same.

In other words, petitioner would have us rule that DENR Administrative Order Nos. 57 and 82 issued
by the DENR Secretary in the exercise of his rule-making power are tainted with invalidity inasmuch
as both contravene or subvert the provisions of Executive Order Nos. 211 and 279 or embrace matters
not covered, nor intended to be covered, by the aforesaid laws.

We disagree.

We reiterate the principle that the power of administrative officials to promulgate rules and regulations
in the implementation of a statute is necessarily limited only to carrying into effect what is provided in
the legislative enactment. The principle was enunciated as early as 1908 in the case of United States
v. Barrias. 15 The scope of the exercise of such rule-making power was clearly expressed in the case
of United States v. Tupasi Molina, 16 decided in 1914, thus: "Of course, the regulations adopted under
legislative authority by a particular department must be in harmony with the provisions of the law, and
for the sole purpose of carrying into effect its general provisions. By such regulations, of course, the
law itself can not be extended. So long, however, as the regulations relate solely to carrying into effect
its general provisions. By such regulations, of course, the law itself can not be extended. So long,
however, as the regulations relate solely to carrying into effect the provision of the law, they are valid."

Recently, the case of People v. Maceren 17 gave a brief delienation of the scope of said power of
administrative officials:

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 provision. By such regulations, of
course, the law itself cannot be extended (U.S. v. Tupasi Molina, supra). An
administrative agency cannot amend an act of Congress (Santos vs. Estenzo, 109
Phil. 419, 422; Teoxon vs. Members of the Board of Administrators, L-25619, June 30,
1970, 33 SCRA 585; Manuel vs. General Auditing Office, L-28952, December 29,
1971, 42 SCRA 660; Deluao v. 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 has 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 v. Board of Tax Appeals, 93 Phil. 376, 382, citing 12 C.J.
845-46. As to invalid regulations, see Collector of Internal Revenue v. Villaflor, 69 Phil.
319; Wise & Co. v. Meer, 78 Phil. 655, 676; Del Mar v. Phil. Veterans Administration,
L-27299, June 27, 1973, 51 SCRA 340, 349).

xxx xxx xxx

. . . 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 Victorias Milling Co., Inc. v. 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 prevails because said rule or regulations cannot go
beyond the terms and provisions of the basic law (People v. Lim, 108 Phil. 1091).
Considering that administrative rules draw life from the statute which they seek to implement, it is
obvious that the spring cannot rise higher than its source. We now examine petitioner's argument that
DENR Administrative Order Nos. 57 and 82 contravene Executive Order Nos. 211 and 279 as both
operate to repeal or abrogate Presidential Decree No. 463, as amended, and other mining laws
allegedly acknowledged as the principal law under Executive Order Nos. 211 and 279.

Petitioner's insistence on the application of Presidential Decree No. 463, as amended, as the
governing law on the acceptance and approval of declarations of location and all other kinds of
applications for the exploration, development, and utilization of mineral resources pursuant to
Executive Order No. 211, is erroneous. Presidential Decree No. 463, as amended, pertains to the old
system of exploration, development and utilization of natural resources through "license, concession
or lease" which, however, has been disallowed by Article XII, Section 2 of the 1987 Constitution. By
virtue of the said constitutional mandate and its implementing law, Executive Order No. 279 which
superseded Executive Order No. 211, the provisions dealing on "license, concession or lease" of
mineral resources under Presidential Decree No. 463, as amended, and other existing mining laws
are deemed repealed and, therefore, ceased to operate as the governing law. In other words, in all
other areas of administration and management of mineral lands, the provisions of Presidential Decree
No. 463, as amended, and other existing mining laws, still govern. Section 7 of Executive Order No.
279 provides, thus:

Sec. 7. All provisions of Presidential Decree No. 463, as amended, other existing mining
laws, and their implementing rules and regulations, or parts thereof, which are not
inconsistent with the provisions of this Executive Order, shall continue in force and
effect.

Specifically, the provisions of Presidential Decree No. 463, as amended, on lease of mining claims
under Chapter VIII, quarry permits on privately-owned lands of quarry license on public lands under
Chapter XIII and other related provisions on lease, license and permits are not only inconsistent with
the raison d'etre for which Executive Order No. 279 was passed, but contravene the express mandate
of Article XII, Section 2 of the 1987 Constitution. It force and effectivity is thus foreclosed.

Upon the effectivity of the 1987 Constitution on February 2, 1987, 18 the State assumed a more
dynamic role in the exploration, development and utilization of the natural resources of the country.
Article XII, Section 2 of the said Charter explicitly ordains that the exploration, development and
utilization of natural resources shall be under the full control and supervision of the State. Consonant
therewith, the exploration, development and utilization of natural resources may be undertaken by
means of direct act of the State, or it may opt to enter into co-production, joint venture, or production-
sharing agreements, or it may enter into agreements with foreign-owned corporations involving either
technical or financial assistance for large-scale exploration, development, and utilization of minerals,
petroleum, and other mineral oils according to the general terms and conditions provided by law, based
on real contributions to the economic growth and general welfare of the country.

Given these considerations, there is no clear showing that respondent DENR Secretary has
transcended the bounds demarcated by Executive Order No. 279 for the exercise of his rule-making
power tantamount to a grave abuse of discretion. Section 6 of Executive Order No. 279 specifically
authorizes said official to promulgate such supplementary rules and regulations as may be necessary
to effectively implement the provisions thereof. Moreover, the subject sought to be governed and
regulated by the questioned orders is germane to the objects and purposes of Executive Order No.
279 specifically issued to carry out the mandate of Article XII, Section 2 of the 1987 Constitution.

Petitioner likewise maintains that Administrative Order No. 57, in relation to Administrative Order No.
82, impairs vested rights as to violate the non-impairment of contract doctrine guaranteed under Article
III, Section 10 of the 1987 Constitution because Article 9 of Administrative Order No. 57 unduly pre-
terminates and automatically converts mining leases and other mining agreements into production-
sharing agreements within one (1) year from effectivity of said guideline, while Section 3 of
Administrative Order No. 82, declares that failure to submit Letters of Intent (LOIs) and MPSAs within
two (2) years from the effectivity of Administrative Order No. 57 or until July 17, 1991 shall cause the
abandonment of mining, quarry, and sand gravel permits.

In Support of the above contention, it is argued by petitioner that Executive Order No. 279 does not
contemplate automatic conversion of mining lease agreements into mining production-sharing
agreement as provided under Article 9, Administrative Order No. 57 and/or the consequent
abandonment of mining claims for failure to submit LOIs and MPSAs under Section 3, Administrative
Order No. 82 because Section 1 of said Executive Order No. 279 empowers the DENR Secretary to
negotiate and enter into voluntary agreements which must set forth the minimum terms and conditions
provided under Section 2 thereof. Moreover, petitioner contends that the power to regulate and enter
into mining agreements does not include the power to preterminate existing mining lease agreements.

To begin with, we dispel the impression created by petitioner's argument that the questioned
administrative orders unduly preterminate existing mining leases in general. A distinction which spells
a real difference must be drawn. Article XII, Section 2 of the 1987 Constitution does not apply
retroactively to "license, concession or lease" granted by the government under the 1973 Constitution
or before the effectivity of the 1987 Constitution on February 2, 1987. The intent to apply prospectively
said constitutional provision was stressed during the deliberations in the Constitutional
Commission, 19 thus:

MR. DAVIDE: Under the proposal, I notice that except for the
[inalienable] lands of the public domain, all other natural resources
cannot be alienated and in respect to [alienable] lands of the public
domain, private corporations with the required ownership by Filipino
citizens can only lease the same. Necessarily, insofar as other natural
resources are concerned, it would only be the State which can exploit,
develop, explore and utilize the same. However, the State may enter
into a joint venture, co-production or production-sharing. Is that not
correct?

MR. VILLEGAS: Yes.

MR. DAVIDE: Consequently, henceforth upon, the approval of this

Constitution, no timber or forest concession, permits or authorization
can be exclusively granted to any citizen of the Philippines nor to any
corporation qualified to acquire lands of the public domain?

MR. VILLEGAS: Would Commissioner Monsod like to comment on

that? I think his answer is "yes."

MR. DAVIDE: So, what will happen now license or concessions earlier
granted by the Philippine government to private corporations or to
Filipino citizens? Would they be deemed repealed?

MR. VILLEGAS: This is not applied retroactively. They will be

respected.

MR. DAVIDE: In effect, they will be deemed repealed?

MR. VILLEGAS: No. (Emphasis supplied)

During the transition period or after the effectivity of the 1987 Constitution on February 2, 1987 until
the first Congress under said Constitution was convened on July 27, 1987, two (2) successive laws,
Executive Order Nos. 211 and 279, were promulgated to govern the processing and approval of
applications for the exploration, development and utilization of minerals. To carry out the purposes of
said laws, the questioned Administrative Order Nos. 57 and 82, now being assailed, were issued by
the DENR Secretary.

Article 9 of Administrative Order No. 57 provides:

ARTICLE 9

TRANSITORY PROVISION

9.1. All existing mining leases or agreements which were granted after
the effectivity of the 1987 Constitution pursuant to Executive Order No.
211, except small scale mining leases and those pertaining to sand
and gravel and quarry resources covering an area of twenty (20)
hectares or less shall be subject to these guidelines. All such leases or
agreements shall be converted into production sharing agreement
within one (1) year from the effectivity of these guidelines. However,
any minimum firm which has established mining rights under
Presidential Decree 463 or other laws may avail of the provisions of
EO 279 by following the procedures set down in this document.
It is clear from the aforestated provision that Administrative Order No. 57 applies only to all existing
mining leases or agreements which were granted after the effectivity of the 1987 Constitution pursuant
to Executive Order No. 211. It bears mention that under the text of Executive Order No. 211, there is
a reservation clause which provides that the privileges as well as the terms and conditions of all
existing mining leases or agreements granted after the effectivity of the 1987 Constitution pursuant to
Executive Order No. 211, shall be subject to any and all modifications or alterations which Congress
may adopt pursuant to Article XII, Section 2 of the 1987 Constitution. Hence, the strictures of the
non-impairment of contract clause under Article III, Section 10 of the 1987 Constitution 20 do not apply
to the aforesaid leases or agreements granted after the effectivity of the 1987 Constitution, pursuant
to Executive Order No. 211. They can be amended, modified or altered by a statute passed by
Congress to achieve the purposes of Article XII, Section 2 of the 1987 Constitution.

Clearly, Executive Order No. 279 issued on July 25, 1987 by President Corazon C. Aquino in the
exercise of her legislative power has the force and effect of a statute or law passed by Congress. As
such, it validly modified or altered the privileges granted, as well as the terms and conditions of mining
leases and agreements under Executive Order No. 211 after the effectivity of the 1987 Constitution by
authorizing the DENR Secretary to negotiate and conclude joint venture, co-production, or production-
sharing agreements for the exploration, development and utilization of mineral resources and
prescribing the guidelines for such agreements and those agreements involving technical or financial
assistance by foreign-owned corporations for large-scale exploration, development, and utilization of
minerals.

Well -settled is the rule, however, that regardless of the reservation clause, mining leases or
agreements granted by the State, such as those granted pursuant to Executive Order No. 211 referred
to this petition, are subject to alterations through a reasonable exercise of the police power of the
State. In the 1950 case of Ongsiako v. Gamboa, 21 where the constitutionality of Republic Act No. 34
changing the 50-50 sharecropping system in existing agricultural tenancy contracts to 55-45 in favor
of tenants was challenged, the Court, upholding the constitutionality of the law, emphasized the
superiority of the police power of the State over the sanctity of this contract:

The prohibition contained in constitutional provisions against: impairing the obligation of contracts is
not an absolute one and it is not to be read with literal exactness like a mathematical formula. Such
provisions are restricted to contracts which respect property, or some object or value, and confer rights
which may be asserted in a court of justice, and have no application to statute relating to public
subjects within the domain of the general legislative powers of the State, and involving the public rights
and public welfare of the entire community affected by it. They do not prevent a proper exercise by the
State of its police powers. By enacting regulations reasonably necessary to secure the health, safety,
morals, comfort, or general welfare of the community, even the contracts may thereby be affected; for
such matter can not be placed by contract beyond the power of the State shall regulates and control
them. 22

In Ramas v. CAR and Ramos 23 where the constitutionality of Section 14 of Republic Act No. 1199
authorizing the tenants to charge from share to leasehold tenancy was challenged on the ground that
it impairs the obligation of contracts, the Court ruled that obligations of contracts must yield to a proper
exercise of the police power when such power is exercised to preserve the security of the State and
the means adopted are reasonably adapted to the accomplishment of that end and are, therefore, not
arbitrary or oppressive.

The economic policy on the exploration, development and utilization of the country's natural resources
under Article XII, Section 2 of the 1987 Constitution could not be any clearer. As enunciated in Article
XII, Section 1 of the 1987 Constitution, the exploration, development and utilization of natural
resources under the new system mandated in Section 2, is geared towards a more equitable
distribution of opportunities, income, and wealth; a sustained increase in the amount of goods and
services produced by the nation for the benefit of the people; and an expanding productivity as the
key to raising the quality of life for all, especially the underprivileged.

The exploration, development and utilization of the country's natural resources are matters vital to the
public interest and the general welfare of the people. The recognition of the importance of the country's
natural resources was expressed as early as the 1984 Constitutional Convention. In connection
therewith, the 1986 U.P. Constitution Project observed: "The 1984 Constitutional Convention
recognized the importance of our natural resources not only for its security and national defense. Our
natural resources which constitute the exclusive heritage of the Filipino nation, should be preserved
for those under the sovereign authority of that nation and for their prosperity. This will ensure the
country's survival as a viable and sovereign republic."
Accordingly, the State, in the exercise of its police power in this regard, may not be precluded by the
constitutional restriction on non-impairment of contract from altering, modifying and amending the
mining leases or agreements granted under Presidential Decree No. 463, as amended, pursuant to
Executive Order No. 211. Police Power, being co-extensive with the necessities of the case and the
demands of public interest; extends to all the vital public needs. The passage of Executive Order No.
279 which superseded Executive Order No. 211 provided legal basis for the DENR Secretary to carry
into effect the mandate of Article XII, Section 2 of the 1987 Constitution.

Nowhere in Administrative Order No. 57 is there any provision which would lead us to conclude that
the questioned order authorizes the automatic conversion of mining leases and agreements granted
after the effectivity of the 1987 Constitution, pursuant to Executive Order No. 211, to production-
sharing agreements. The provision in Article 9 of Administrative Order No. 57 that "all such leases or
agreements shall be converted into production sharing agreements within one (1) year from the
effectivity of these guidelines" could not possibility contemplate a unilateral declaration on the part of
the Government that all existing mining leases and agreements are automatically converted into
production-sharing agreements. On the contrary, the use of the term "production-sharing agreement"
if they are so minded. Negotiation negates compulsion or automatic conversion as suggested by
petitioner in the instant petition. A mineral production-sharing agreement (MPSA) requires a meeting
of the minds of the parties after negotiations arrived at in good faith and in accordance with the
procedure laid down in the subsequent Administrative Order No. 82.

We, therefore, rule that the questioned administrative orders are reasonably directed to the
accomplishment of the purposes of the law under which they were issued and were intended to secure
the paramount interest of the public, their economic growth and welfare. The validity and
constitutionality of Administrative Order Nos. 57 and 82 must be sustained, and their force and effect
upheld.

We now, proceed to the petition-in-intervention. Under Section 2, Rule 12 of the Revised Rules of
Court, an intervention in a case is proper when the intervenor has a "legal interest in the matter in
litigation, or in the success of either of the parties, or an interest against both, or when he is so situated
as to be adversely affected by a distribution or other disposition of property in the custody of the court
or of an officer thereof. "Continental Marble Corporation has not sufficiently shown that it falls under
any of the categories mentioned above. The refusal of the DENR, Regional Office No. 3, San
Fernando, Pampanga to renew its Mines Temporary Permit does not justify such an intervention by
Continental Marble Corporation for the purpose of obtaining a directive from this Court for the issuance
of said permit. Whether or not Continental Marble matter best addressed to the appropriate
government body but certainly, not through this Court. Intervention is hereby DENIED.

WHEREFORE, the petition is DISMISSED for lack of merit. The Temporary Restraining Order issued
on July 2, 1991 is hereby LIFTED.

SO ORDERED.

Narvasa, C.J., Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Bellosillo, Melo, Quiason, Puno,
Vitug, Kapunan and Mendoza, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 91192 December 2, 1991

ROBINSON V. CASIÑO, petitioner,

vs.
THE COURT OF APPEALS, GINGOOG GALLERA, INC., represented by its President and
Manager, LINDY L. DE LARA, respondents.

Feliciano A. Sia for petitioner.

Josefino B. Remotigue for private respondent.

REGALADO, J.:p

This is a petition to review the decision 1 of the Court of Appeals in CA-G.R. No. SP-156966 which
affirmed the judgment 2 rendered by the Regional Trial Court of Gingoog City, declaring the city
mayor's permits 3 issued in favor of petitioner Robinson V. Casiño as null and void, and ordering him,
his agents, and/or authorized representatives and all persons acting in his behalf, to desist from further
operating the cockpit in question, known as the Don Romulo Rodriguez Coliseum (here inafter,
Coliseum). However, the writ of preliminary injunction ordered by the trial court to be made permanent
was deleted in the appealed decision, the former having theretofore been dissolved.

Prior to the passage by the Sangguniang Panlungsod of Gingoog City of Resolution No. 49, Code
Ordinance, Series of 1984, the Coliseum, located on Block 125 at the corner of Lugod and Jadol
Streets, Gingoog City and owned by petitioner, was a licensee of a cockpit under Sections 2285 to
2286 of the Revised Administrative Code. Thereafter, the aforesaid resolution classified certain areas
of the city as residential zones, declaring, among others, the site of Coliseum as such. The
classification led to the cancellation of petitioner's license to operate the cockpit.

Article 10, Section 6.44 of the same resolution provides:

Sec 6.44. Amendments to the zoning ordinance.— Changes in the zoning

ordinance as a result of the review by the Local Review Committee shall be
treated as an amendment provided that any amendment to the zoning
ordinance or provision thereof shall be carried out through a resolution of three
fourths vote of the Sangguniang Panglunsod. Said amendments shall take
effect only after approval and authentication by the HSRC.

On August 13, 1985, Resolution No. 378, Code Ordinance, Series of 1985, reclassified Block 125 as
within the recreational zone, thus allegedly amending Resolution No. 49. Nine (9) members of the
said sangguniang panlungsod, participated, with four (4) members voting for the amendment, while
four (4) voted against, and with one (1) abstention. The vice-mayor, as presiding officer, broke the
deadlock by voting for the amendment.

When Resolution No. 378 was transmitted to then City Mayor Miguel Paderanga for approval, he
returned the same to the sangguniang panlungsod within ten days, without any action, stating that his
approval thereof was not necessary since it did not involve a disposition of city government funds, as
provided by Section 180 of the Local Government Code and Section 14 of the charter of Gingoog City.

By virtue of said Resolution No. 378, the succeeding city mayor, Arturo S. Lugod, issued to petitioner
the aforestated permit to operate a cockpit dated April 2, 1986, which was renewed by another permit
issued on January 5, 1987. 4

Private respondent Gingoog Gallera, Inc., (hereafter, Gallera) protested the operation of Coliseum
before the Philippine Gamefowl Commission (PGC, for short). The protest was founded on the fact
that no certificate of registration had as yet been issued by the PGC, 5 although city mayor's permits
were issued to petitioner. On April 11, 1986, the PGC, through OIC Pacifico L. Orog sent a telegram
to the Station Commander of Gingoog City to suspend in the meantime the operation of the cockpit.
On April 24, 1986, the PGC eventually sent a telegram to the city mayor to stop any cockfight in the
Coliseum in view of its failure to register with the PGC. 6
Thereafter, Special Civil Action No. 86-020 for prohibition and mandamus with preliminary injunction
was filed by Gallera before the Regional Trial Court, Branch XXVII, Gingoog City, against
petitioner, 7 on the ground that Resolution No. 378, purportedly amending zoning Ordinance No. 49,
is invalid. It asserted that the classification of Coliseum's site as still within the residential zone of
Gingoog City was accordingly maintained and unchanged, thereby rendering the mayor's permits
issued to the latter null and void for being in violation of Section 6 of the Rules and Regulations of the
PGC.

On April 25, 1986, the trial court issued a writ of preliminary injunction enjoining petitioner to desist
from operating the Coliseum until the PGC shall have finally decided the controversy between
petitioner and private respondent Gallera.

Resolving the case on July 25, 1988, the trial court rendered judgment in favor of private respondent,
declaring the aforesaid mayor's permits null and void and ordering herein petitioner and all persons
representing him or acting in his behalf from further operating the cockpit in question.

Petitioner appealed the said unfavorable judgment to respondent court which, on May 30, 1989, issued
the decision under consideration. Hence, this present recourse, after petitioner's motion for
reconsideration was denied for lack of merit on October 27, 1989. 8

In his memorandum, petitioner takes issue with what he conceives as respondents' erroneous
contentions that:

(1) the Philippine Gamefowl Commission controls the operations of the Don Romulo Rodriguez
Coliseum with respect to the local/ordinary cockfights during Sundays, holidays and fiestas in Gingoog
City, despite the fact that the Mayor of Gingoog City issued a mayor's permit for 1986 and 1987 (Exhs.
"1" and "9") with the concurrence of the sangguniang panlungsod (Exhs. "20", "21", and "22"); and

(2) the mayor's permits (Exhibits "1" and "9") issued by the Mayor of Gingoog City for the years 1986
and 1987 are allegedly null and void because Resolution 378 (Exh. "O") did not amend Section 6.44
of Resolution 49 (Exh. "L"), Code Ordinance of 1984, the three-fourths (3/4) votes not having been
obtained in passing said Resolution 378. 9

On the first objection of petitioner, it is true that the PGC has the power not of control but only of review
and supervision. This power was validly exercised by said commission over Coliseum when it sought
to stop the former's operations through the local officials. It did not whimsically order the suspension
and the consequent stoppage of Coliseum's operations. Rather, PGC only exercised its power of
review over the acts performed by the local authorities in relation to or which affect the exercise of its
functions.

Review is a reconsideration or re-examination for purposes of correction. The power of review is

exercised to determine whether it is necessary to correct the acts of the subordinate and to see to it
that he performs his duties in accordance with law. 10 This the PGC did by bringing to the attention of
the local authorities the non-compliance by petitioner with the rules involved in this case which we find
reasonable and necessary in the discharge of the regulatory functions of PGC. PGC may, for that
purpose and as it did here, indicate its disapproval of the acts of the local officials concerned 11 to
stress and perform its role with respect to the regulation of cockpits.

On this aspect of the corresponding powers of the PGC and the local authorities, respondent court
amply clarified in its resolution of October 27, 1989 the position it had taken in its main opinion, thus:

With respect to private respondent-appellant's (herein petitioner) Motion for

Reconsideration his interpretation that the decision of the First Division of this
Court, promulgated on April 28, 1989, in CA-G.R. SP No. 15024, entitled
Gingoog Gallera, Inc. vs. The Philippine Gamefowl Commission is
"diametrically opposed to" the decision rendered in this case in regard to the
primacy of the power/authority between the local officials of the City of Gingoog
and the Philippine Gamefowl Commission (PGC) is erroneous.

Both decisions are in accord with one another. The decision of the First
Division that it is the Municipal/City Mayor with the authorization of the
Sangguniang Bayan that has the primary power to issue licenses for the
operation of ordinary cockpits is of the same tenor and effect as the decision
of this case as can be seen in the following wordings:
 The task of granting licenses to operate cockpits is lodged with
City and Municipal Mayor with the concurrence of their
respective Sanggunians. This is specifically granted to them by
Section 4 of Presidential Decree No. 1802 as amended by
Presidential Decree No. 1802-A which states:

Sec. 4. City and Municipal Mayors with the

concurrence of their respective Sanggunians shall
have the authority to license and regulate regular
cockfighting pursuant to the rules and regulations
promulgated by the Commission and subject to its
review and supervision.

This is not to say that the power to grant licenses is absolute.

It must be noted that certain requirements must be complied
(with) before a license may issue. First, the rules and
regulations promulgated by the Commission in connection with
the operation of cockpits must be observed. And second, that
there must be concurrence of the Sanggunians. (Decision, p.
6)

While this Court agrees with the movant that a mayor's permit/ license is a
condition precedent to the issuance of the PGC Registration Certificate, in the
case at bar, the city mayor's permits issued to movant were null and void as
they were granted pursuant to Resolution No. 578 which never took effect
because of non-compliance with the procedure prescribed in Resolution No.
49. And because of the nullity of the Mayor's permit, the Registration Certificate
No. C-86816 issued to movant is likewise null and void. The spring cannot rise
higher than its source. 12

The foregoing discussion brings us to the determinant legal query to be resolved, which is the validity
of Resolution No. 378. Petitioner argues for the legality of Resolution No. 378 because the same was
passed by the sanggunian by a majority of five (5) affirmative votes as against four (4) negative votes.
He contends that the three-fourths vote requirement under Section 6.44, Resolution No. 49, aside from
its being merely a formal requirement, is an enactment of the sanggunian which is ultra vires.

We do not agree. Resolution No. 378 was declared invalid by the Court of Appeals for failure to comply
with the required votes necessary for its validity. Although the charter of the City of Gingoog and the
Local Government Code require only a majority for the enactment of an ordinance, Resolution No. 49
cannot be validly amended by the resolution in question without complying with the categorical
requirement of a three-fourths vote incorporated in the very same ordinance sought to be amended.
The pertinent provisions in the aforesaid city charter and the Local Government Code obviously are of
general application and embrace a wider scope or subject matter. In the enactment of ordinances in
general, the application of the aforementioned laws cannot be disputed. Undeniably, however, Section
6.44 of said ordinance regarding amendments thereto is a specific and particular provision for said
ordinance and explicitly provides for a different number of votes. Where there is in the same statute a
particular enactment and also a general one which in its most comprehensive sense would include
what is embraced in the former, the particular enactment must be operative, and the general statement
must be taken to affect only such cases within its language as are not within the provisions of the
particular enactment. 13

In the instant case, although the general law on the matter requires a mere majority, the higher
requisite vote in Resolution No. 49 shall govern since municipal authorities are in a better position to
determine the evils sought to be prevented by the inclusion or incorporation of particular provisions in
enacting a particular statute and, therefore, to pass the appropriate ordinance to attain the main object
of the law. 14 This more stringent requirement on the necessary votes for amendments to Resolution
No. 49 apparently forestalled the apprehended contingency for, to borrow the words of respondent
court, "in an apparent attempt to get rid of this legal stumbling block (the prohibition against a cockpit
in a residential zone under Proclamation 49), the Sangguniang Panglunsod of Gingoog City passed
Resolution No. 378, Code Ordinance, series of 1985," . . . "thereby reclassifying Block 125 into a
recreational zone." 15 Withal, it is legally permissible, as exceptions to the general provisions on
measures covered by city charters and the Local Government Code, that the vote requirement in
certain ordinances may be specially provided for, as in the case of Section 6.44 of Resolution No. 49,
instead of the usual majority Vote. 16
In sum, Block 125 where Coliseum is located remains classified as a residential area, hence the
operation of a cockpit therein is prohibited. This weighty consideration, which should actually be the
principal basis for the nullification by respondent court of the two mayor's permits issued to petitioner
(private respondent-appellant therein), was explained as follows:

The rules and regulations promulgated by the Commission on June 1, 1981 in

connection with the operation of all cockpits in the Philippines particularly
Section 6 and 12 thereof reads as follows:

Sec. 6. Site and Constructions of cockpits. — Cockpits shall be

constructed and operated within the appropriate areas as
prescribed in zoning laws or ordinances.

Sec. 12. Registration of cockpits. — All cockpits in the

Philippines shall register with the Philippine Gamefowl
Commission not later than September 30, 1981. No cockpit
shall be allowed to operate without the proper registration
certificate being secured annually, not later than January 31.

xxx xxx xxx

In the case at bar, there was no registration certificate issued, much less
authorization to operate given by the PGC to the private respondent-appellant,
a condition precedent before a grant of mayors permit or license to conduct
cockfighting. Therefore, the mayor's permits issued to private respondent are
null and void.

Obviously, the PGC did not grant the private respondent-appellant the proper
registration certificate to operate his cockpit because the same was not
constructed within the appropriate areas as prescribed in zoning laws or
ordinances of Gingoog City pursuant to Section 6 of Rules and Regulation of
the PGC. . . . 17

It bears mention, however, that the issue in this case is the validity of the city mayor's permits of April
22,1986 and January 5, 1987 and the nullity whereof is affirmed in this opinion. Respondents observe
that they see no useful purpose in having said permits declared null and void since they are
already functus officio. We agree, however, with the stance taken respondent court that this
adjudication would still be in order since it can hereafter serve as a guide for the proper and legal
issuance of mayor's permits to cockpits owners. As pertinently quoted, justice demands that we act
then, not only for the vindication of the outraged rights, though gone, but also for the guidance of and
as a restraint upon the future. 18

IN VIEW OF THE FOREGOING, the petition is hereby DENIED. The decision of respondent Court of
Appeals promulgated on May 30, 1989 and its resolution dated October 27, 1989 are AFFIRMED.

SO ORDERED.

Melencio-Herrera, Paras and Padilla, JJ., concur.