PUBCORP – ATTY PASCASIO

GENERAL PRINCIPLES

1. LIBAN VS GORDON 2011 – 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.
It is neither a subdivision, agency, or instrumentality of the government, nor a
government-owned or controlled corporation or a subsidiary thereof. The sui
generis character of PNRC requires us to approach controversies involving the PNRC
on a case-to-case basis.

2. BSP VS COA 2011 – BSP is a public corporation subject to COA’s audit jurisdiction.
It is created by a special law to serve a public purpose in pursuit of a constitutional
mandate which comes within the class of “public corporations” defined by par. 2 of
Article 44 of the Civil Code. The BSP is a public corporation or a government agency
or instrumentality with juridical personality, which does not fall within the
constitutional prohibition in Article XII, Section 16, notwithstanding the amendments
to its charter. Not all corporations, which are not government owned or controlled, are
ipso facto to be considered private corporations as there exists another distinct class of
corporations or chartered institutions which are otherwise known as “public
corporations”. These corporations are treated by law as agencies or instrumentalities of
the government which are not subject to the tests of ownership or control and economic
viability but to different criteria relating to their public purposes/interests or
constitutional policies and objectives and their administrative relationship to the
government or any of its Departments or Offices.

3. PHILIPPINE SOCIETY FOR THE PREVENTION OF CRUELTY TO

ANIMALS V COA 2007 – PSPCA is a private corporation and not an agency of the
government as provided by the amendments introduced by C.A. No. 148. The fact that
a certain juridical entity is impressed with public interest does not, by that circumstance
alone, make the entity a public corporation, inasmuch as a corporation may be private
although its charter contains provisions of a public character, incorporated solely for
the public good. This class of corporations may be considered quasi-public
corporations, which are private corporations that render public service, supply public
 wants, or pursue other eleemosynary objectives. While purposely organized for the gain
or benefit of its members, they are required by law to discharge functions for the public
benefit. Examples of these corporations are utility, railroad, warehouse, telegraph,
telephone, water supply corporations and transportation companies. It must be stressed
that a quasi-public corporation is a species of private corporations, but the qualifying
factor is the type of service the former renders to the public: if it performs a public
service, then it becomes a quasi-public corporation. The true criterion, therefore, to
determine whether a corporation is public or private is found in the totality of the
relation of the corporation to the State. If the corporation is created by the State as the
latter’s own agency or instrumentality to help it in carrying out its governmental
functions, then that corporation is considered public; otherwise, it is private. Applying
the above test, provinces, chartered cities, and barangays can best exemplify public
corporations. They are created by the State as its own device and agency for the
accomplishment of parts of its own public works.

4. THE PROVINCE OF NORTH COTABATO V GRP PEACE PANEL 2008 –

PRINCIPLES OF LOCAL AUTONOMY

1. BASCO V. PAGCOR 1991 - The City of Manila, being a mere Municipal corporation
has no inherent right to impose taxes. Its “power to tax” therefore must always yield to
a legislative act which is superior having been passed upon by the state itself which has
the “inherent power to tax”. The Charter of the City of Manila is subject to control by
Congress. It should be stressed that “municipal corporations are mere creatures of
Congress” which has the power to “create and abolish municipal corporations” due to
its “general legislative powers”. Congress, therefore, has the power of control over local
governments. And if Congress can grant the City of Manila the power to tax certain
matters, it can also provide for exemptions or even take back the power. Local
governments have no power to tax instrumentalities of the National Government.
PAGCOR is a government owned or controlled corporation with an original charter,
PD 1869. All of its shares of stocks are owned by the National Government. PAGCOR
has a dual role, to operate and to regulate gambling casinos. The latter role is
governmental, which places it in the category of an agency or instrumentality of the
Government. Being an instrumentality of the Government, PAGCOR should be and
actually is exempt from local taxes. Otherwise, its operation might be burdened,
impeded or subjected to control by a mere Local government. “The states have no
power by taxation or otherwise, to retard, impede, burden or in any manner control the
operation of constitutional laws enacted by Congress to carry into execution the powers
vested in the federal government.” This doctrine emanates from the “supremacy” of the
National Government over local governments. The power to tax which was called by
Justice Marshall as the “power to destroy” cannot be allowed to defeat an
instrumentality or creation of the very entity which has the inherent power to wield it.
The principle of local autonomy under the 1987 Constitution simply means
“decentralization”. It does not make local governments sovereign within the state or an
“imperium in imperio.” Local Government has been described as a political subdivision
of a nation or state which is constituted by law and has substantial control of local
affairs. In a unitary system of government, such as the government under the Philippine
Constitution, local governments can only be an intra sovereign subdivision of
 one sovereign nation, it cannot be an imperium in imperio. Local government in such a
system can only mean a measure of decentralization of the function of government.

2. LINA V. PANO 2001 - As a policy statement expressing the local government’s

objection to the lotto, such resolution is valid. This is part of the local government’s
autonomy to air its views which may be contrary to that of the national government’s.
However, this freedom to exercise contrary views does not mean that local governments
may actually enact ordinances that go against laws duly enacted by Congress.In our
system of government, the power of local government units to legislate and enact
ordinances and resolutions is merely a delegated power coming from Congress.
Municipal governments are only agents of the national government. Local councils
exercise only delegated legislative powers conferred upon them by Congress as the
national lawmaking body. The delegate cannot be superior to the principal or exercise
powers higher than those of the latter. It is a heresy to suggest that the local government
units can undo the acts of Congress, from which they have derived their power in the
first place, and negate by mere ordinance the mandate of the statute. Municipal
corporations owe their origin to, and derive their powers and rights wholly from the
legislature. It breathes into them the breath of life, without which they cannot exist. As
it creates, so it may destroy. As it may destroy, it may abridge and control. Unless there
is some constitutional limitation on the right, the legislature might, by a single act, and
if we can suppose it capable of so great a folly and so great a wrong, sweep from
existence all of the municipal corporations in the state, and the corporation could not
prevent it. We know of no limitation on the right so far as the corporation themselves
are concerned. They are, so to phrase it, the mere tenants at will of the legislature. Ours
is still a unitary form of government, not a federal state. Being so, any form of autonomy
granted to local governments will necessarily be limited and confined within the extent
allowed by the central authority. Besides, the principle of local autonomy under the
1987 Constitution simply means “decentralization”. It does not make local
governments sovereign within the state or an “imperium in imperio.”

3. LIMBONA V. MANGELIN 1989 - Autonomy is either decentralization of

administration or decentralization of power. There is decentralization of administration
when the central government delegates administrative powers to political subdivision
in order to broaden the base of government power and in the process to make local
governments “more responsive and accountable,” and “ensure their fullest development
as self-reliant communities and make them more effective partners in the pursuit of
national development and social progress.” At the same time, it relieves the central
government of the burden of managing local affairs and enables it to concentrate on
national concerns. The President exercises “general supervision” over them, but only
to “ensure that local affairs are administered according to law.” He has no control over
their acts in the sense that he can substitute their judgments with his own.
Decentralization of power, on the other hand, involves an abdication of political power
in favor of local government units declared to be autonomous. In that case, the
autonomous government is free to chart its own destiny and shape its future with
minimum intervention from central authorities. According to a constitutional author,
decentralization of power amounts to “self-immolation,” since in that event, the
autonomous government becomes accountable not to the central authorities but to its
constituency.

Local autonomy is the degree of self-determination exercised by LGUs vis-à-vis the

central government. The system of achieving local autonomy is known as
decentralization and this system is realized through the process called devolution.

Decentralization – is a system whereby LGUs shall be given more powers,

authority and responsibilities and resources and a direction by which this is done
is from the national government to the local government

Devolution – refers to the act by which the national government confers power
and authority upon the various local government units to perform specific
functions and responsibilities.

This includes the transfer to local government units of the records, equipment, and other
assets and personnel of national agencies and offices corresponding to the devolved
powers, functions, and responsibilities.

Distinguish devolution from deconcentration: Deconcentration is different. If

devolution involves the transfer of resources, powers from national government to
LGUs, deconcentration is from national office to a local office. Deconcentration is the
 transfer of authority and power to the appropriate regional offices or field offices of
national agencies or offices whose major functions are not devolved to local
government units.

4. DISOMANGCOP V. DATUMANONG 2004 -