FIRST DIVISION

[G.R. No. 135962. March 27, 2000]

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. BEL-AIR VILLAGE ASSOCIATION,

INC., respondent.

DECISION

PUNO, J.:

Not infrequently, the government is tempted to take legal shortcuts to solve urgent problems of the people. But even
when government is armed with the best of intention, we cannot allow it to run roughshod over the rule of law. Again,
we let the hammer fall and fall hard on the illegal attempt of the MMDA to open for public use a private road in a
private subdivision. While we hold that the general welfare should be promoted, we stress that it should not be
achieved at the expense of the rule of law. h Y

Petitioner MMDA is a government agency tasked with the delivery of basic services in Metro Manila. Respondent
Bel-Air Village Association, Inc. (BAVA) is a non-stock, non-profit corporation whose members are homeowners in
Bel-Air Village, a private subdivision in Makati City. Respondent BAVA is the registered owner of Neptune Street, a
road inside Bel-Air Village.

On December 30, 1995, respondent received from petitioner, through its Chairman, a notice dated December 22,
1995 requesting respondent to open Neptune Street to public vehicular traffic starting January 2, 1996. The notice
reads: Court

"SUBJECT: NOTICE of the Opening of Neptune Street to Traffic

"Dear President Lindo,

"Please be informed that pursuant to the mandate of the MMDA law or Republic Act No. 7924
which requires the Authority to rationalize the use of roads and/or thoroughfares for the safe and
convenient movement of persons, Neptune Street shall be opened to vehicular traffic effective
January 2, 1996.

"In view whereof, the undersigned requests you to voluntarily open the points of entry and exit on
said street.

"Thank you for your cooperation and whatever assistance that may be extended by your
association to the MMDA personnel who will be directing traffic in the area.

"Finally, we are furnishing you with a copy of the handwritten instruction of the President on the
matter.

"Very truly yours,

PROSPERO I. ORETA

Chairman"[1]

On the same day, respondent was apprised that the perimeter wall separating the subdivision from the adjacent
Kalayaan Avenue would be demolished. Sppedsc

On January 2, 1996, respondent instituted against petitioner before the Regional Trial Court, Branch 136, Makati
City, Civil Case No. 96-001 for injunction. Respondent prayed for the issuance of a temporary restraining order and
preliminary injunction enjoining the opening of Neptune Street and prohibiting the demolition of the perimeter wall.
The trial court issued a temporary restraining order the following day.

On January 23, 1996, after due hearing, the trial court denied issuance of a preliminary injunction. [2] Respondent
questioned the denial before the Court of Appeals in CA-G.R. SP No. 39549. The appellate court conducted an
ocular inspection of Neptune Street[3] and on February 13, 1996, it issued a writ of preliminary injunction enjoining the
implementation of the MMDAs proposed action. [4]
On January 28, 1997, the appellate court rendered a Decision on the merits of the case finding that the MMDA has
no authority to order the opening of Neptune Street, a private subdivision road and cause the demolition of its
perimeter walls. It held that the authority is lodged in the City Council of Makati by ordinance. The decision disposed
of as follows: Jurissc

"WHEREFORE, the Petition is GRANTED; the challenged Order dated January 23, 1995, in Civil
Case No. 96-001, is SET ASIDE and the Writ of Preliminary Injunction issued on February 13,
1996 is hereby made permanent.

"For want of sustainable substantiation, the Motion to Cite Roberto L. del Rosario in contempt is
denied.[5]

"No pronouncement as to costs.

"SO ORDERED."[6]

The Motion for Reconsideration of the decision was denied on September 28, 1998. Hence, this recourse. Jksm

Petitioner MMDA raises the following questions:

"I

HAS THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY (MMDA) THE MANDATE

TO OPEN NEPTUNE STREET TO PUBLIC TRAFFIC PURSUANT TO ITS REGULATORY AND
POLICE POWERS?

II

IS THE PASSAGE OF AN ORDINANCE A CONDITION PRECEDENT BEFORE THE MMDA

MAY ORDER THE OPENING OF SUBDIVISION ROADS TO PUBLIC TRAFFIC?

III

IS RESPONDENT BEL-AIR VILLAGE ASSOCIATION, INC. ESTOPPED FROM DENYING OR

ASSAILING THE AUTHORITY OF THE MMDA TO OPEN THE SUBJECT STREET? Jlexj

WAS RESPONDENT DEPRIVED OF DUE PROCESS DESPITE THE SEVERAL MEETINGS

HELD BETWEEN MMDA AND THE AFFECTED BEL-AIR RESIDENTS AND BAVA OFFICERS?

HAS RESPONDENT COME TO COURT WITH UNCLEAN HANDS?" [7]

Neptune Street is owned by respondent BAVA. It is a private road inside Bel-Air Village, a private residential
subdivision in the heart of the financial and commercial district of Makati City. It runs parallel to Kalayaan Avenue, a
national road open to the general public. Dividing the two (2) streets is a concrete perimeter wall approximately
fifteen (15) feet high. The western end of Neptune Street intersects Nicanor Garcia, formerly Reposo Street, a
subdivision road open to public vehicular traffic, while its eastern end intersects Makati Avenue, a national road. Both
ends of Neptune Street are guarded by iron gates. Edp mis

Petitioner MMDA claims that it has the authority to open Neptune Street to public traffic because it is an agent of the
state endowed with police power in the delivery of basic services in Metro Manila. One of these basic services is
traffic management which involves the regulation of the use of thoroughfares to insure the safety, convenience and
welfare of the general public. It is alleged that the police power of MMDA was affirmed by this Court in the
consolidated cases of Sangalang v. Intermediate Appellate Court.[8] From the premise that it has police power, it is
now urged that there is no need for the City of Makati to enact an ordinance opening Neptune street to the public. [9]

Police power is an inherent attribute of sovereignty. It has been defined as the power vested by the Constitution in
the legislature to make, ordain, and establish all manner of wholesome and reasonable laws, statutes and
ordinances, either with penalties or without, not repugnant to the Constitution, as they shall judge to be for the good
and welfare of the commonwealth, and for the subjects of the same.[10] The power is plenary and its scope is vast and
pervasive, reaching and justifying measures for public health, public safety, public morals, and the general welfare. [11]

It bears stressing that police power is lodged primarily in the National Legislature. [12] It cannot be exercised by any
group or body of individuals not possessing legislative power.[13] The National Legislature, however, may delegate
this power to the President and administrative boards as well as the lawmaking bodies of municipal corporations or
local government units.[14]Once delegated, the agents can exercise only such legislative powers as are conferred on
them by the national lawmaking body.[15]

A local government is a "political subdivision of a nation or state which is constituted by law and has substantial
control of local affairs."[16] The Local Government Code of 1991 defines a local government unit as a "body politic and
corporate"[17]-- one endowed with powers as a political subdivision of the National Government and as a corporate
entity representing the inhabitants of its territory.[18] Local government units are the provinces, cities, municipalities
and barangays.[19] They are also the territorial and political subdivisions of the state. [20]

Our Congress delegated police power to the local government units in the Local Government Code of 1991.
This delegation is found in Section 16 of the same Code, known as the general welfare clause, viz: Chief

"Sec. 16. General Welfare.Every local government unit shall exercise the powers expressly
granted, those necessarily implied therefrom, as well as powers necessary, appropriate, or
incidental for its efficient and effective governance, and those which are essential to the
promotion of the general welfare. Within their respective territorial jurisdictions, local government
units shall ensure and support, among other things, the preservation and enrichment of culture,
promote health and safety, enhance the right of the people to a balanced ecology, encourage
and support the development of appropriate and self-reliant scientific and technological
capabilities, improve public morals, enhance economic prosperity and social justice, promote full
employment among their residents, maintain peace and order, and preserve the comfort and
convenience of their inhabitants."[21]

Local government units exercise police power through their respective legislative bodies. The legislative body
of the provincial government is the sangguniang panlalawigan, that of the city government is the sangguniang
panlungsod, that of the municipal government is the sangguniang bayan, and that of the barangay is
the sangguniang barangay. The Local Government Code of 1991 empowers the sangguniang panlalawigan,
sangguniang panlungsod and sangguniang bayan to "enact ordinances, approve resolutions and appropriate
funds for the general welfare of the [province, city or municipality, as the case may be], and its inhabitants pursuant
to Section 16 of the Code and in the proper exercise of the corporate powers of the [province, city municipality]
provided under the Code x x x."[22] The same Code gives the sangguniang barangay the power to "enact ordinances
as may be necessary to discharge the responsibilities conferred upon it by law or ordinance and to promote the
general welfare of the inhabitants thereon."[23]

Metropolitan or Metro Manila is a body composed of several local government units - i.e., twelve (12) cities
and five (5) municipalities, namely, the cities of Caloocan, Manila, Mandaluyong, Makati, Pasay, Pasig, Quezon,
Muntinlupa, Las Pinas, Marikina, Paranaque and Valenzuela, and the municipalities of Malabon, , Navotas, , Pateros,
San Juan and Taguig. With the passage of Republic Act (R. A.) No. 7924 [24] in 1995, Metropolitan Manila was
declared as a "special development and administrative region" and the Administration of "metro-wide" basic
services affecting the region placed under "a development authority" referred to as the MMDA.[25]

"Metro-wide services" are those "services which have metro-wide impact and transcend local political boundaries or
entail huge expenditures such that it would not be viable for said services to be provided by the individual local
government units comprising Metro Manila." [26] There are seven (7) basic metro-wide services and the scope of these
services cover the following: (1) development planning; (2) transport and traffic management; (3) solid waste disposal
and management; (4) flood control and sewerage management; (5) urban renewal, zoning and land use planning,
and shelter services; (6) health and sanitation, urban protection and pollution control; and (7) public safety. The basic
service of transport and traffic management includes the following: Lexjuris

"(b) Transport and traffic management which include the formulation, coordination, and
monitoring of policies, standards, programs and projects to rationalize the existing
transport operations, infrastructure requirements, the use of thoroughfares, and
promotion of safe and convenient movement of persons and goods; provision for the
mass transport system and the institution of a system to regulate road users;
administration and implementation of all traffic enforcement operations, traffic
engineering services and traffic education programs, including the institution of a single
ticketing system in Metropolitan Manila;"[27]

In the delivery of the seven (7) basic services, the MMDA has the following powers and functions: Esm
 "Sec. 5. Functions and powers of the Metro Manila Development Authority.The MMDA shall:

(a) Formulate, coordinate and regulate the implementation of medium and long-term plans and
programs for the delivery of metro-wide services, land use and physical development within
Metropolitan Manila, consistent with national development objectives and priorities;

(b) Prepare, coordinate and regulate the implementation of medium-term investment programs
for metro-wide services which shall indicate sources and uses of funds for priority programs and
projects, and which shall include the packaging of projects and presentation to funding
institutions; Esmsc

(c) Undertake and manage on its own metro-wide programs and projects for the delivery of
specific services under its jurisdiction, subject to the approval of the Council. For this purpose,
MMDA can create appropriate project management offices;

(d) Coordinate and monitor the implementation of such plans, programs and projects in Metro
Manila; identify bottlenecks and adopt solutions to problems of implementation;

(e) The MMDA shall set the policies concerning traffic in Metro Manila, and shall
coordinate and regulate the implementation of all programs and projects concerning
traffic management, specifically pertaining to enforcement, engineering and education.
Upon request, it shall be extended assistance and cooperation, including but not limited
to, assignment of personnel, by all other government agencies and offices concerned;

(f) Install and administer a single ticketing system, fix, impose and collect fines and
penalties for all kinds of violations of traffic rules and regulations, whether moving or
non-moving in nature, and confiscate and suspend or revoke drivers licenses in the
enforcement of such traffic laws and regulations, the provisions of RA 4136 and PD 1605
to the contrary notwithstanding. For this purpose, the Authority shall impose all traffic
laws and regulations in Metro Manila, through its traffic operation center, and may
deputize members of the PNP, traffic enforcers of local government units, duly licensed
security guards, or members of non-governmental organizations to whom may be
delegated certain authority, subject to such conditions and requirements as the Authority
may impose; and

(g) Perform other related functions required to achieve the objectives of the MMDA, including the
undertaking of delivery of basic services to the local government units, when deemed necessary
subject to prior coordination with and consent of the local government unit concerned." Jurismis

The implementation of the MMDAs plans, programs and projects is undertaken by the local government units,
national government agencies, accredited peoples organizations, non-governmental organizations, and the private
sector as well as by the MMDA itself. For this purpose, the MMDA has the power to enter into contracts, memoranda
of agreement and other cooperative arrangements with these bodies for the delivery of the required services within
Metro Manila.[28]

The governing board of the MMDA is the Metro Manila Council. The Council is composed of the mayors of the
component 12 cities and 5 municipalities, the president of the Metro Manila Vice-Mayors League and the president of
the Metro Manila Councilors League. [29] The Council is headed by a Chairman who is appointed by the President and
vested with the rank of cabinet member. As the policy-making body of the MMDA, the Metro Manila Council approves
metro-wide plans, programs and projects, and issues the necessary rules and regulations for the implementation of
said plans; it approves the annual budget of the MMDA and promulgates the rules and regulations for the delivery of
basic services, collection of service and regulatory fees, fines and penalties. These functions are particularly
enumerated as follows: LEX

"Sec. 6. Functions of the Metro Manila Council. -

(a) The Council shall be the policy-making body of the MMDA;

(b) It shall approve metro-wide plans, programs and projects and issue rules and regulations
deemed necessary by the MMDA to carry out the purposes of this Act;

(c) It may increase the rate of allowances and per diems of the members of the Council to be
effective during the term of the succeeding Council. It shall fix the compensation of the officers
and personnel of the MMDA, and approve the annual budget thereof for submission to the
Department of Budget and Management (DBM);
 (d) It shall promulgate rules and regulations and set policies and standards for metro-wide
application governing the delivery of basic services, prescribe and collect service and regulatory
fees, and impose and collect fines and penalties." Jj sc

Clearly, the scope of the MMDAs function is limited to the delivery of the seven (7) basic services. One of these is
transport and traffic management which includes the formulation and monitoring of policies, standards and projects to
rationalize the existing transport operations, infrastructure requirements, the use of thoroughfares and promotion of
the safe movement of persons and goods. It also covers the mass transport system and the institution of a system of
road regulation, the administration of all traffic enforcement operations, traffic engineering services and traffic
education programs, including the institution of a single ticketing system in Metro Manila for traffic violations. Under
this service, the MMDA is expressly authorized "to set the policies concerning traffic" and "coordinate and regulate
the implementation of all traffic management programs." In addition, the MMDA may "install and administer a single
ticketing system," fix, impose and collect fines and penalties for all traffic violations. Ca-lrsc

It will be noted that the powers of the MMDA are limited to the following acts: formulation, coordination, regulation,
implementation, preparation, management, monitoring, setting of policies, installation of a system and
administration. There is no syllable in R. A. No. 7924 that grants the MMDA police power, let alone legislative
power. Even the Metro Manila Council has not been delegated any legislative power. Unlike the legislative bodies of
the local government units, there is no provision in R. A. No. 7924 that empowers the MMDA or its Council to "enact
ordinances, approve resolutions and appropriate funds for the general welfare" of the inhabitants of Metro Manila.
The MMDA is, as termed in the charter itself, a "development authority." [30] It is an agency created for the purpose of
laying down policies and coordinating with the various national government agencies, peoples organizations, non-
governmental organizations and the private sector for the efficient and expeditious delivery of basic services in the
vast metropolitan area. All its functions are administrative in nature and these are actually summed up in the
charter itself, viz:

"Sec. 2. Creation of the Metropolitan Manila Development Authority. -- x x x.

The MMDA shall perform planning, monitoring and coordinative functions, and in the
process exercise regulatory and supervisory authority over the delivery of metro-wide
services within Metro Manila, without diminution of the autonomy of the local government units
concerning purely local matters."[31]

Petitioner cannot seek refuge in the cases of Sangalang v. Intermediate Appellate Court[32] where we upheld a
zoning ordinance issued by the Metro Manila Commission (MMC), the predecessor of the MMDA, as an exercise of
police power. The first Sangalang decision was on the merits of the petition,[33] while the second decision denied
reconsideration of the first case and in addition discussed the case of Yabut v. Court of Appeals.[34]

Sangalang v. IAC involved five (5) consolidated petitions filed by respondent BAVA and three residents of Bel-Air
Village against other residents of the Village and the Ayala Corporation, formerly the Makati Development
Corporation, as the developer of the subdivision. The petitioners sought to enforce certain restrictive easements in
the deeds of sale over their respective lots in the subdivision. These were the prohibition on the setting up of
commercial and advertising signs on the lots, and the condition that the lots be used only for residential purposes.
Petitioners alleged that respondents, who were residents along Jupiter Street of the subdivision, converted their
residences into commercial establishments in violation of the "deed restrictions," and that respondent Ayala
Corporation ushered in the full commercialization" of Jupiter Street by tearing down the perimeter wall that separated
the commercial from the residential section of the village.[35]

The petitions were dismissed based on Ordinance No. 81 of the Municipal Council of Makati and Ordinance No. 81-
01 of the Metro Manila Commission (MMC). Municipal Ordinance No. 81 classified Bel-Air Village as a Class A
Residential Zone, with its boundary in the south extending to the center line of Jupiter Street. The Municipal
Ordinance was adopted by the MMC under the Comprehensive Zoning Ordinance for the National Capital Region
and promulgated as MMC Ordinance No. 81-01. Bel-Air Village was indicated therein as bounded by Jupiter Street
and the block adjacent thereto was classified as a High Intensity Commercial Zone. [36]

We ruled that since both Ordinances recognized Jupiter Street as the boundary between Bel-Air Village and the
commercial district, Jupiter Street was not for the exclusive benefit of Bel-Air residents. We also held that the
perimeter wall on said street was constructed not to separate the residential from the commercial blocks but simply
for security reasons, hence, in tearing down said wall, Ayala Corporation did not violate the "deed restrictions" in the
deeds of sale. Scc-alr

We upheld the ordinances, specifically MMC Ordinance No. 81-01, as a legitimate exercise of police power. [37] The
power of the MMC and the Makati Municipal Council to enact zoning ordinances for the general welfare prevailed
over the "deed restrictions".
In the second Sangalang/Yabut decision, we held that the opening of Jupiter Street was warranted by the demands
of the common good in terms of "traffic decongestion and public convenience." Jupiter was opened by the Municipal
Mayor to alleviate traffic congestion along the public streets adjacent to the Village. [38] The same reason was given for
the opening to public vehicular traffic of Orbit Street, a road inside the same village. The destruction of the gate in
Orbit Street was also made under the police power of the municipal government. The gate, like the perimeter wall
along Jupiter, was a public nuisance because it hindered and impaired the use of property, hence, its summary
abatement by the mayor was proper and legal. [39]

Contrary to petitioners claim, the two Sangalang cases do not apply to the case at bar. Firstly, both involved
zoning ordinances passed by the municipal council of Makati and the MMC. In the instant case, the basis for the
proposed opening of Neptune Street is contained in the notice of December 22, 1995 sent by petitioner to respondent
BAVA, through its president. The notice does not cite any ordinance or law, either by the Sangguniang Panlungsod of
Makati City or by the MMDA, as the legal basis for the proposed opening of Neptune Street. Petitioner MMDA simply
relied on its authority under its charter "to rationalize the use of roads and/or thoroughfares for the safe and
convenient movement of persons." Rationalizing the use of roads and thoroughfares is one of the acts that fall within
the scope of transport and traffic management. By no stretch of the imagination, however, can this be interpreted as
an express or implied grant of ordinance-making power, much less police power. Misjuris

Secondly, the MMDA is not the same entity as the MMC in Sangalang. Although the MMC is the forerunner of
the present MMDA, an examination of Presidential Decree (P. D.) No. 824, the charter of the MMC, shows that
the latter possessed greater powers which were not bestowed on the present MMDA. Jjlex

Metropolitan Manila was first created in 1975 by Presidential Decree (P.D.) No. 824. It comprised the Greater Manila
Area composed of the contiguous four (4) cities of Manila, Quezon, Pasay and Caloocan, and the thirteen (13)
municipalities of Makati, Mandaluyong, San Juan, Las Pinas, Malabon, Navotas, Pasig, Pateros, Paranaque,
Marikina, Muntinlupa and Taguig in the province of Rizal, and Valenzuela in the province of Bulacan. [40] Metropolitan
Manila was created as a response to the finding that the rapid growth of population and the increase of social and
economic requirements in these areas demand a call for simultaneous and unified development; that the public
services rendered by the respective local governments could be administered more efficiently and economically if
integrated under a system of central planning; and this coordination, "especially in the maintenance of peace and
order and the eradication of social and economic ills that fanned the flames of rebellion and discontent [were] part of
reform measures under Martial Law essential to the safety and security of the State." [41]

Metropolitan Manila was established as a "public corporation" with the following powers: Calrs-pped

"Section 1. Creation of the Metropolitan Manila.There is hereby created a public corporation, to

be known as the Metropolitan Manila, vested with powers and attributes of a corporation
including the power to make contracts, sue and be sued, acquire, purchase, expropriate,
hold, transfer and dispose of property and such other powers as are necessary to carry
out its purposes. The Corporation shall be administered by a Commission created under this
Decree."[42]

The administration of Metropolitan Manila was placed under the Metro Manila Commission (MMC) vested with the
following powers:

"Sec. 4. Powers and Functions of the Commission. - The Commission shall have the following
powers and functions:

1. To act as a central government to establish and administer programs and provide

services common to the area;

2. To levy and collect taxes and special assessments, borrow and expend money and issue
bonds, revenue certificates, and other obligations of indebtedness. Existing tax measures
should, however, continue to be operative until otherwise modified or repealed by the
Commission;

3. To charge and collect fees for the use of public service facilities;

4. To appropriate money for the operation of the metropolitan government and review
appropriations for the city and municipal units within its jurisdiction with authority to disapprove
the same if found to be not in accordance with the established policies of the Commission,
without prejudice to any contractual obligation of the local government units involved existing at
the time of approval of this Decree;
 5. To review, amend, revise or repeal all ordinances, resolutions and acts of cities and
municipalities within Metropolitan Manila;

6. To enact or approve ordinances, resolutions and to fix penalties for any violation
thereof which shall not exceed a fine of P10,000.00 or imprisonment of six years or both
such fine and imprisonment for a single offense;

7. To perform general administrative, executive and policy-making functions;

8. To establish a fire control operation center, which shall direct the fire services of the city and
municipal governments in the metropolitan area;

9. To establish a garbage disposal operation center, which shall direct garbage collection and
disposal in the metropolitan area;

10. To establish and operate a transport and traffic center, which shall direct traffic
activities; Jjjuris

11. To coordinate and monitor governmental and private activities pertaining to essential
services such as transportation, flood control and drainage, water supply and sewerage, social,
health and environmental services, housing, park development, and others;

12. To insure and monitor the undertaking of a comprehensive social, economic and physical
planning and development of the area;

13. To study the feasibility of increasing barangay participation in the affairs of their respective
local governments and to propose to the President of the Philippines definite programs and
policies for implementation;

14. To submit within thirty (30) days after the close of each fiscal year an annual report to the
President of the Philippines and to submit a periodic report whenever deemed necessary; and

15. To perform such other tasks as may be assigned or directed by the President of the
Philippines." Sc jj

The MMC was the "central government" of Metro Manila for the purpose of establishing and administering
programs providing services common to the area. As a "central government" it had the power to levy and collect
taxes and special assessments, the power to charge and collect fees; the power to appropriate money for its
operation, and at the same time, review appropriations for the city and municipal units within its jurisdiction. It was
bestowed the power to enact or approve ordinances, resolutions and fix penalties for violation of such ordinances
and resolutions. It also had the power to review, amend, revise or repeal all ordinances, resolutions and acts of any
of the four (4) cities and thirteen (13) municipalities comprising Metro Manila.

P. D. No. 824 further provided:

"Sec. 9. Until otherwise provided, the governments of the four cities and thirteen municipalities in
the Metropolitan Manila shall continue to exist in their present form except as may be
inconsistent with this Decree. The members of the existing city and municipal councils in
Metropolitan Manila shall, upon promulgation of this Decree, and until December 31, 1975,
become members of the Sangguniang Bayan which is hereby created for every city and
municipality of Metropolitan Manila.

In addition, the Sangguniang Bayan shall be composed of as many barangay captains as may
be determined and chosen by the Commission, and such number of representatives from other
sectors of the society as may be appointed by the President upon recommendation of the
Commission.

x x x.

The Sangguniang Bayan may recommend to the Commission ordinances, resolutions or

such measures as it may adopt; Provided, that no such ordinance, resolution or measure
shall become effective, until after its approval by the Commission; and Provided further,
that the power to impose taxes and other levies, the power to appropriate money and the
 power to pass ordinances or resolutions with penal sanctions shall be vested exclusively
in the Commission."

The creation of the MMC also carried with it the creation of the Sangguniang Bayan. This was composed of the
members of the component city and municipal councils, barangay captains chosen by the MMC and sectoral
representatives appointed by the President. The Sangguniang Bayan had the power to recommend to the MMC the
adoption of ordinances, resolutions or measures. It was the MMC itself, however, that possessed legislative
powers. All ordinances, resolutions and measures recommended by the Sangguniang Bayan were subject to the
MMCs approval. Moreover, the power to impose taxes and other levies, the power to appropriate money, and the
power to pass ordinances or resolutions with penal sanctions were vested exclusively in the MMC. Sce-dp

Thus, Metropolitan Manila had a "central government," i.e., the MMC which fully possessed legislative and
police powers. Whatever legislative powers the component cities and municipalities had were all subject to
review and approval by the MMC.

After President Corazon Aquino assumed power, there was a clamor to restore the autonomy of the local
government units in Metro Manila. Hence, Sections 1 and 2 of Article X of the 1987 Constitution provided: Sj cj

"Section 1. The territorial and political subdivisions of the Republic of the Philippines are the
provinces, cities, municipalities and barangays. There shall be autonomous regions in Muslim
Mindanao and the Cordilleras as herein provided.

Section 2. The territorial and political subdivisions shall enjoy local autonomy."

The Constitution, however, recognized the necessity of creating metropolitan regions not only in the existing National
Capital Region but also in potential equivalents in the Visayas and Mindanao. [43] Section 11 of the same Article X thus
provided:

"Section 11. The Congress may, by law, create special metropolitan political subdivisions,
subject to a plebiscite as set forth in Section 10 hereof. The component cities and municipalities
shall retain their basic autonomy and shall be entitled to their own local executives and
legislative assemblies. The jurisdiction of the metropolitan authority that will thereby be created
shall be limited to basic services requiring coordination."

The Constitution itself expressly provides that Congress may, by law, create "special metropolitan political
subdivisions" which shall be subject to approval by a majority of the votes cast in a plebiscite in the political units
directly affected; the jurisdiction of this subdivision shall be limited to basic services requiring coordination; and the
cities and municipalities comprising this subdivision shall retain their basic autonomy and their own local executive
and legislative assemblies.[44] Pending enactment of this law, the Transitory Provisions of the Constitution gave the
President of the Philippines the power to constitute the Metropolitan Authority, viz:

"Section 8. Until otherwise provided by Congress, the President may constitute the Metropolitan
Authority to be composed of the heads of all local government units comprising the Metropolitan
Manila area."[45]

In 1990, President Aquino issued Executive Order (E. O.) No. 392 and constituted the Metropolitan Manila
Authority (MMA). The powers and functions of the MMC were devolved to the MMA. [46] It ought to be stressed,
however, that not all powers and functions of the MMC were passed to the MMA. The MMAs power was
limited to the "delivery of basic urban services requiring coordination in Metropolitan Manila." [47] The MMAs
governing body, the Metropolitan Manila Council, although composed of the mayors of the component cities
and municipalities, was merely given the power of: (1) formulation of policies on the delivery of basic
services requiring coordination and consolidation; and (2) promulgation of resolutions and other issuances,
approval of a code of basic services and the exercise of its rule-making power. [48]

Under the 1987 Constitution, the local government units became primarily responsible for the governance of their
respective political subdivisions. The MMAs jurisdiction was limited to addressing common problems involving
basic services that transcended local boundaries. It did not have legislative power. Its power was merely to provide
the local government units technical assistance in the preparation of local development plans. Any semblance of
legislative power it had was confined to a "review [of] legislation proposed by the local legislative assemblies to
ensure consistency among local governments and with the comprehensive development plan of Metro Manila," and
to "advise the local governments accordingly." [49]

When R.A. No. 7924 took effect, Metropolitan Manila became a "special development and administrative
region" and the MMDA a "special development authority" whose functions were "without prejudice to the
autonomy of the affected local government units." The character of the MMDA was clearly defined in the
legislative debates enacting its charter.

R. A. No. 7924 originated as House Bill No. 14170/ 11116 and was introduced by several legislators led by Dante
Tinga, Roilo Golez and Feliciano Belmonte. It was presented to the House of Representatives by the Committee on
Local Governments chaired by Congressman Ciriaco R. Alfelor. The bill was a product of Committee consultations
with the local government units in the National Capital Region (NCR), with former Chairmen of the MMC and MMA,
[50]
 and career officials of said agencies. When the bill was first taken up by the Committee on Local Governments,
the following debate took place:

"THE CHAIRMAN [Hon. Ciriaco Alfelor]: Okay, Let me explain. This has been debated a long
time ago, you know. Its a special we can create a special metropolitan political
subdivision. Supreme

Actually, there are only six (6) political subdivisions provided for in the Constitution: barangay,
municipality, city, province, and we have the Autonomous Region of Mindanao and we have the
Cordillera. So we have 6. Now.

HON. [Elias] LOPEZ: May I interrupt, Mr. Chairman. In the case of the Autonomous Region, that
is also specifically mandated by the Constitution.

THE CHAIRMAN: Thats correct. But it is considered to be a political subdivision. What is the

meaning of a political subdivision? Meaning to say, that it has its own government, it has
its own political personality, it has the power to tax, and all governmental powers: police
power and everything. All right. Authority is different; because it does not have its own
government. It is only a council, it is an organization of political subdivision, powers, no,
which is not imbued with any political power. Esmmis

If you go over Section 6, where the powers and functions of the Metro Manila
Development Authority, it is purely coordinative. And it provides here that the council is
policy-making. All right.

Under the Constitution is a Metropolitan Authority with coordinative power. Meaning to say, it
coordinates all of the different basic services which have to be delivered to the constituency. All
right.

There is now a problem. Each local government unit is given its respective as a political subdivision. Kalookan has its
powers, as provided for and protected and guaranteed by the Constitution. All right, the exercise. However, in the
exercise of that power, it might be deleterious and disadvantageous to other local government units. So, we are
forming an authority where all of these will be members and then set up a policy in order that the basic services can
be effectively coordinated. All right. justice

Of course, we cannot deny that the MMDA has to survive. We have to provide some funds,
resources. But it does not possess any political power. We do not elect the Governor. We
do not have the power to tax. As a matter of fact, I was trying to intimate to the author that it
must have the power to sue and be sued because it coordinates. All right. It coordinates
practically all these basic services so that the flow and the distribution of the basic services will
be continuous. Like traffic, we cannot deny that. Its before our eyes. Sewerage, flood control,
water system, peace and order, we cannot deny these. Its right on our face. We have to look for
a solution. What would be the right solution? All right, we envision that there should be a
coordinating agency and it is called an authority. All right, if you do not want to call it an authority,
its alright. We may call it a council or maybe a management agency.

x x x."[51]

Clearly, the MMDA is not a political unit of government. The power delegated to the MMDA is that given to the
Metro Manila Council to promulgate administrative rules and regulations in the implementation of the MMDAs
functions. There is no grant of authority to enact ordinances and regulations for the general welfare of the
inhabitants of the metropolis. This was explicitly stated in the last Committee deliberations prior to the bills
presentation to Congress. Thus: Ed-p

"THE CHAIRMAN: Yeah, but we have to go over the suggested revision. I think this was already
approved before, but it was reconsidered in view of the proposals, set-up, to make the MMDA
stronger. Okay, so if there is no objection to paragraph "f" And then next is paragraph "b," under
Section 6. "It shall approve metro-wide plans, programs and projects and issue
 ordinances or resolutions deemed necessary by the MMDA to carry out the purposes of
this Act." Do you have the powers? Does the MMDA because that takes the form of a local
government unit, a political subdivision.

HON. [Feliciano] BELMONTE: Yes, I believe so, your Honor. When we say that it has the
policies, its very clear that those policies must be followed. Otherwise, whats the use of
empowering it to come out with policies. Now, the policies may be in the form of a resolution or it
may be in the form of a ordinance. The term "ordinance" in this case really gives it more teeth,
your honor. Otherwise, we are going to see a situation where you have the power to adopt the
policy but you cannot really make it stick as in the case now, and I think here is Chairman Bunye.
I think he will agree that that is the case now. Youve got the power to set a policy, the body
wants to follow your policy, then we say lets call it an ordinance and see if they will not follow it.

THE CHAIRMAN: Thats very nice. I like that. However, there is a constitutional impediment.
You are making this MMDA a political subdivision. The creation of the MMDA would be
subject to a plebiscite. That is what Im trying to avoid. Ive been trying to avoid this kind of
predicament. Under the Constitution it states: if it is a political subdivision, once it is
created it has to be subject to a plebiscite. Im trying to make this as administrative. Thats
why we place the Chairman as a cabinet rank.

HON. BELMONTE: All right, Mr. Chairman, okay, what you are saying there is .

THE CHAIRMAN: In setting up ordinances, it is a political exercise. Believe me.

HON. [Elias] LOPEZ: Mr. Chairman, it can be changed into issuances of rules and
regulations. That would be it shall also be enforced. Jksm

HON. BELMONTE: Okay, I will .

HON. LOPEZ: And you can also say that violation of such rule, you impose a sanction.
But you know, ordinance has a different legal connotation.

HON. BELMONTE: All right. I defer to that opinion, your Honor. sc

THE CHAIRMAN: So instead of ordinances, say rules and regulations.

HON. BELMONTE: Or resolutions. Actually, they are actually considering resolutions now.

THE CHAIRMAN: Rules and resolutions.

HON. BELMONTE: Rules, regulations and resolutions." [52]

The draft of H. B. No. 14170/ 11116 was presented by the Committee to the House of Representatives. The
explanatory note to the bill stated that the proposed MMDA is a "development authority" which is a "national agency,
not a political government unit."[53] The explanatory note was adopted as the sponsorship speech of the Committee
on Local Governments. No interpellations or debates were made on the floor and no amendments introduced. The
bill was approved on second reading on the same day it was presented.[54]

When the bill was forwarded to the Senate, several amendments were made. These amendments, however, did not
affect the nature of the MMDA as originally conceived in the House of Representatives. [55]

It is thus beyond doubt that the MMDA is not a local government unit or a public corporation endowed with
legislative power. It is not even a "special metropolitan political subdivision" as contemplated in Section 11, Article X
of the Constitution. The creation of a "special metropolitan political subdivision" requires the approval by a majority of
the votes cast in a plebiscite in the political units directly affected.[56] R. A. No. 7924 was not submitted to the
inhabitants of Metro Manila in a plebiscite. The Chairman of the MMDA is not an official elected by the people, but
appointed by the President with the rank and privileges of a cabinet member. In fact, part of his function is to perform
such other duties as may be assigned to him by the President, [57] whereas in local government units, the President
merely exercises supervisory authority. This emphasizes the administrative character of the MMDA. Newmiso

Clearly then, the MMC under P. D. No. 824 is not the same entity as the MMDA under R. A. No. 7924. Unlike
the MMC, the MMDA has no power to enact ordinances for the welfare of the community. It is the local
government units, acting through their respective legislative councils, that possess legislative power and police
power. In the case at bar, the Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution
ordering the opening of Neptune Street, hence, its proposed opening by petitioner MMDA is illegal and the
respondent Court of Appeals did not err in so ruling. We desist from ruling on the other issues as they are
unnecessary. Esmso

We stress that this decision does not make light of the MMDAs noble efforts to solve the chaotic traffic condition in
Metro Manila. Everyday, traffic jams and traffic bottlenecks plague the metropolis. Even our once sprawling
boulevards and avenues are now crammed with cars while city streets are clogged with motorists and pedestrians.
Traffic has become a social malaise affecting our peoples productivity and the efficient delivery of goods and services
in the country. The MMDA was created to put some order in the metropolitan transportation system but unfortunately
the powers granted by its charter are limited. Its good intentions cannot justify the opening for public use of a private
street in a private subdivision without any legal warrant. The promotion of the general welfare is not antithetical to the
preservation of the rule of law. Sdjad

IN VIEW WHEREOF, the petition is denied. The Decision and Resolution of the Court of Appeals in CA-G.R. SP No.
39549 are affirmed. Sppedsc

SO ORDERED.

Davide, Jr., C.J., (Chairman), Kapunan, Pardo, and Ynares-Santiago, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 93252               August 5, 1991

RODOLFO T. GANZON, petitioner, 
vs.
THE HONORABLE COURT OF APPEALS and LUIS T. SANTOS, respondents.

G.R. No. 93746               August 5,1991

MARY ANN RIVERA ARTIEDA, petitioner, 

vs.
HON. LUIS SANTOS, in his capacity as Secretary of the Department of Local Government, NICANOR M.
PATRICIO, in his capacity as Chief, Legal Service of the Department of Local Government and SALVADOR
CABALUNA JR., respondents.

G.R. No. 95245               August 5,1991

RODOLFO T. GANZON, petitioner, 
vs.
THE HONORABLE COURT OF APPEALS and LUIS T. SANTOS, in his capacity as the Secretary of the
Department of Local Government, respondents.

Nicolas P. Sonalan for petitioner in 93252.

Romeo A. Gerochi for petitioner in 93746.
Eugenio Original for petitioner in 95245.

SARMIENTO, J.:

The petitioners take common issue on the power of the President (acting through the Secretary of Local
Government), to suspend and/or remove local officials.

The petitioners are the Mayor of Iloilo City (G.R. Nos. 93252 and 95245) and a member of the Sangguniang
Panglunsod thereof (G.R. No. 93746), respectively.

The petitions of Mayor Ganzon originated from a series of administrative complaints, ten in number, filed against him
by various city officials sometime in 1988, on various charges, among them, abuse of authority, oppression, grave
misconduct, disgraceful and immoral conduct, intimidation, culpable violation of the Constitution, and arbitrary
detention.1 The personalities involved are Joceleehn Cabaluna, a clerk at the city health office; Salvador Cabaluna,
her husband; Dr. Felicidad Ortigoza, Assistant City Health Officer; Mansueto Malabor, Vice-Mayor; Rolando Dabao,
Dan Dalido, German Gonzales, Larry Ong, and Eduardo Pefia Redondo members of the Sangguniang Panglunsod;
and Pancho Erbite, a barangay tanod. The complaints against the Mayor are set forth in the opinion of the
respondent Court of Appeals.2 We quote:

x x x           x x x          x x x

In her verified complaint (Annex A), Mrs. Cabaluna, a clerk assigned to the City Health, Office of Iloilo City charged
that due to political reasons, having supported the rival candidate, Mrs. Rosa 0. Caram, the petitioner City Mayor,
using as an excuse the exigency of the service and the interest of the public, pulled her out from rightful office where
her qualifications are best suited and assigned her to a work that should be the function of a non-career service
employee. To make matters worse, a utility worker in the office of the Public Services, whose duties are alien to the
complainant's duties and functions, has been detailed to take her place. The petitioner's act are pure harassments
aimed at luring her away from her permanent position or force her to resign.
In the case of Dra. Felicidad Ortigoza, she claims that the petitioner handpicked her to perform task not befitting her
position as Assistant City Health Officer of Iloilo City; that her office was padlocked without any explanation or
justification; that her salary was withheld without cause since April 1, 1988; that when she filed her vacation leave,
she was given the run-around treatment in the approval of her leave in connivance with Dr. Rodolfo Villegas and that
she was the object of a well-engineered trumped-up charge in an administrative complaint filed by Dr. Rodolfo
Villegas (Annex B).

On the other hand, Mansuelo Malabor is the duly elected Vice-Mayor of Iloilo City and complainants Rolando Dabao,
Dan Dalido, German Gonzales, Larry Ong and Eduardo Pefia Pedondo are members of the Sangguniang
Panglunsod of the City of Iloilo. Their complaint arose out from the case where Councilor Larry Ong, whose key to his
office was unceremoniously and without previous notice, taken by petitioner. Without an office, Councilor Ong had to
hold office at Plaza Libertad, The Vice-Mayor and the other complainants sympathized with him and decided to do
the same. However, the petitioner, together with its fully-armed security men, forcefully drove them away from Plaza
Libertad. Councilor Ong denounced the petitioner's actuations the following day in the radio station and decided to
hold office at the Freedom Grandstand at Iloilo City and there were so many people who gathered to witness the
incident. However, before the group could reach the area, the petitioner, together with his security men, led the
firemen using a firetruck in dozing water to the people and the bystanders.

Another administrative case was filed by Pancho Erbite, a barangay tanod, appointed by former mayor Rosa O.
Caram. On March 13, 1988, without the benefit of charges filed against him and no warrant of arrest was issued,
Erbite was arrested and detained at the City Jail of Iloilo City upon orders of petitioner. In jail, he was allegedly
mauled by other detainees thereby causing injuries He was released only the following day. 3

The Mayor thereafter answered4 and the cases were shortly set for hearing. The opinion of the Court of Appeals also
set forth the succeeding events:

x x x           x x x          x x x

The initial hearing in the Cabaluna and Ortigoza cases were set for hearing on June 20-21, 1988 at the Regional
Office of the Department of Local Government in Iloilo City. Notices, through telegrams, were sent to the parties
(Annex L) and the parties received them, including the petitioner. The petitioner asked for a postponement before the
scheduled date of hearing and was represented by counsel, Atty. Samuel Castro. The hearing officers, Atty. Salvador
Quebral and Atty. Marino Bermudez had to come all the way from Manila for the two-day hearings but was actually
held only on June 20,1988 in view of the inability and unpreparedness of petitioner's counsel.

The next hearings were re-set to July 25, 26, 27,1988 in the same venue-Iloilo City. Again, the petitioner attempted to
delay the proceedings and moved for a postponement under the excuse that he had just hired his counsel.
Nonetheless, the hearing officers denied the motion to postpone, in view of the fact that the parties were notified by
telegrams of the scheduled hearings (Annex M).

In the said hearings, petitioner's counsel cross-examined the complainants and their witnesses.

Finding probable grounds and reasons, the respondent issued a preventive suspension order on August 11, 1988 to
last until October 11,1988 for a period of sixty (60) days.

Then the next investigation was set on September 21, 1988 and the petitioner again asked for a postponement to
September 26,1988. On September 26, 1988, the complainants and petitioner were present, together with their
respective counsel. The petitioner sought for a postponement which was denied. In these hearings which were held
in Mala the petitioner testified in Adm. Case No. C-10298 and 10299.

The investigation was continued regarding the Malabor case and the complainants testified including their witnesses.

On October 10, 1988, petitioner's counsel, Atty. Original moved for a postponement of the October 24, 1988 hearing
to November 7 to 11, 1988 which was granted. However, the motion for change of venue as denied due to lack of
funds. At the hearing on November 7, 1988, the parties and counsel were present. Petitioner reiterated his motion to
change venue and moved for postponement anew. The counsel discussed a proposal to take the deposition of
witnesses in Iloilo City so the hearing was indefinitely postponed. However, the parties failed to come to terms and
after the parties were notified of the hearing, the investigation was set to December 13 to 15, 1988.

The petitioner sought for another postponement on the ground that his witnesses were sick or cannot attend the
investigation due to lack of transportation. The motion was denied and the petitioner was given up to December 14,
1988 to present his evidence.
On December 14,1988, petitioner's counsel insisted on his motion for postponement and the hearing officers gave
petitioner up to December 15, 1988 to present his evidence. On December 15, 1988, the petitioner failed to present
evidence and the cases were considered submitted for resolution.

In the meantime, a prima facie evidence was found to exist in the arbitrary detention case filed by Pancho Erbite so
the respondent ordered the petitioner's second preventive suspension dated October 11, 1988 for another sixty (60)
days. The petitioner was able to obtain a restraining order and a writ of preliminary injunction in the Regional Trial
Court, Branch 33 of Iloilo City. The second preventive suspension was not enforced. 5

Amidst the two successive suspensions, Mayor Ganzon instituted an action for prohibition against the respondent
Secretary of Local Government (now, Interior) in the Regional Trial Court, Iloilo City, where he succeeded in
obtaining a writ of preliminary injunction. Presently, he instituted CA-G.R. SP No. 16417, an action for prohibition, in
the respondent Court of Appeals.

Meanwhile, on May 3, 1990, the respondent Secretary issued another order, preventively suspending Mayor Ganzon
for another sixty days, the third time in twenty months, and designating meantime Vice-Mayor Mansueto Malabor as
acting mayor. Undaunted, Mayor Ganzon commenced CA-G.R. SP No. 20736 of the Court of Appeals, a petition for
prohibition,6 (Malabor it is to be noted, is one of the complainants, and hence, he is interested in seeing Mayor
Ganzon ousted.)

On September 7, 1989, the Court of Appeals rendered judgment, dismissing CA-G.R. SP No. 16417. On July 5,
1990, it likewise promulgated a decision, dismissing CA-G.R. SP No. 20736. In a Resolution dated January 24, 1990,
it issued a Resolution certifying the petition of Mary Ann Artieda, who had been similary charged by the respondent
Secretary, to this Court.

On June 26,1990, we issued a Temporary Restraining Order, barring the respondent Secretary from implementing
the suspension orders, and restraining the enforcement of the Court of Appeals' two decisions.

In our Resolution of November 29, 1990, we consolidated all three cases. In our Resolutions of January 15, 1991, we
gave due course thereto.

Mayor Ganzon claims as a preliminary (GR No. 93252), that the Department of Local Government in hearing the ten
cases against him, had denied him due process of law and that the respondent Secretary had been "biased,
prejudicial and hostile" towards him 7 arising from his (Mayor Ganzon's) alleged refusal to join the Laban ng
Demokratikong Pilipino party8 and the running political rivalry they maintained in the last congressional and local
elections;9 and his alleged refusal to operate a lottery in Iloilo City.10 He also alleges that he requested the Secretary
to lift his suspension since it had come ninety days prior to an election (the barangay elections of November 14,
1988),11 notwithstanding which, the latter proceeded with the hearing and meted out two more suspension orders of
the aforementioned cases.12 He likewise contends that he sought to bring the cases to Iloilo City (they were held in
Manila) in order to reduce the costs of proceeding, but the Secretary rejected his request. 13 He states that he asked
for postponement on "valid and justifiable" 14 grounds, among them, that he was suffering from a heart ailment which
required confinement; that his "vital"15 witness was also hospitalized16 but that the latter unduly denied his request. 17

Mayor Ganzon's primary argument (G.R. Nos. 93252 and 95245) is that the Secretary of Local Government is
devoid, in any event, of any authority to suspend and remove local officials, an argument reiterated by the petitioner
Mary Ann Rivera Artieda (G.R. No. 93746).

As to Mayor Ganzon's charges of denial of due process, the records do not show very clearly in what manner the
Mayor might have been deprived of his rights by the respondent Secretary. His claims that he and Secretary Luis-
Santos were (are) political rivals and that his "persecution" was politically motivated are pure speculation and
although the latter does not appear to have denied these contentions (as he, Mayor Ganzon, claims), we can not
take his word for it the way we would have under less political circumstances, considering furthermore that "political
feud" has often been a good excuse in contesting complaints.

The Mayor has failed furthermore to substantiate his say-so's that Secretary Santos had attempted to seduce him to
join the administration party and to operate a lottery in Iloilo City. Again, although the Secretary failed to rebut his
allegations, we can not accept them, at face value, much more, as judicial admissions as he would have us accept
them18 for the same reasons above-stated and furthermore, because his say so's were never corroborated by
independent testimonies. As a responsible public official, Secretary Santos, in pursuing an official function, is
presumed to be performing his duties regularly and in the absence of contrary evidence, no ill motive can be ascribed
to him.

As to Mayor Ganzon's contention that he had requested the respondent Secretary to defer the hearing on account of
the ninety-day ban prescribed by Section 62 of Batas Blg. 337, the Court finds the question to be moot and academic
since we have in fact restrained the Secretary from further hearing the complaints against the petitioners. 19
As to his request, finally, for postponements, the Court is afraid that he has not given any compelling reason why we
should overturn the Court of Appeals, which found no convincing reason to overrule Secretary Santos in denying his
requests. Besides, postponements are a matter of discretion on the part of the hearing officer, and based on Mayor
Ganzon's above story, we are not convinced that the Secretary has been guilty of a grave abuse of discretion.

The Court can not say, under these circumstances, that Secretary Santos' actuations deprived Mayor Ganzon of due
process of law.

We come to the core question: Whether or not the Secretary of Local Government, as the President's alter ego, can
suspend and/or remove local officials.

It is the petitioners' argument that the 1987 Constitution 20 no longer allows the President, as the 1935 and 1973
Constitutions did, to exercise the power of suspension and/or removal over local officials. According to both
petitioners, the Constitution is meant, first, to strengthen self-rule by local government units and second, by deleting
the phrase21 as may be provided by law to strip the President of the power of control over local governments. It is a
view, so they contend, that finds support in the debates of the Constitutional Commission. The provision in question
reads as follows:

Sec. 4. The President of the Philippines shall exercise general supervision over local governments. Provinces with
respect to component cities and municipalities, and cities and municipalities with respect to component barangays
shall ensure that the acts of their component units are within the scope of their prescribed powers and functions. 22

It modifies a counterpart provision appearing in the 1935 Constitution, which we quote:

Sec. 10. The President shall have control of all the executive departments, bureaus, or offices, exercise general
supervision over all Local governments as may be provided by law, and take care that the laws be faithfully
executed.23

The petitioners submit that the deletion (of "as may be provided by law") is significant, as their argument goes, since:
(1) the power of the President is "provided by law" and (2) hence, no law may provide for it any longer.

It is to be noted that in meting out the suspensions under question, the Secretary of Local Government acted in
consonance with the specific legal provisions of Batas Blg. 337, the Local Government Code, we quote:

Sec. 62. Notice of Hearing. — Within seven days after the complaint is filed, the Minister of local Government, or the
sanggunian concerned, as the case may be, shall require the respondent to submit his verified answer within seven
days from receipt of said complaint, and commence the hearing and investigation of the case within ten days after
receipt of such answer of the respondent. No investigation shall be held within ninety days immediately prior to an
election, and no preventive suspension shall be imposed with the said period. If preventive suspension has been
imposed prior to the aforesaid period, the preventive suspension shall be lifted. 24

Sec. 63. Preventive Suspension. — (1) Preventive suspension may be imposed by the Minister of Local Government
if the respondent is a provincial or city official, by the provincial governor if the respondent is an elective municipal
official, or by the city or municipal mayor if the respondent is an elective barangay official.

(2) Preventive suspension may be imposed at any time after the issues are joined, when there is reasonable ground
to believe that the respondent has committed the act or acts complained of, when the evidence of culpability is
strong, when the gravity of the offense so warrants, or when the continuance in office of the respondent could
influence the witnesses or pose a threat to the safety and integrity of the records and other evidence. In all cases,
preventive suspension shall not extend beyond sixty days after the start of said suspension.

(3) At the expiration of sixty days, the suspended official shall be deemed reinstated in office without prejudice to the
continuation of the proceedings against him until its termination. However ' if the delay in the proceedings of the case
is due to his fault, neglect or request, the time of the delay shall not be counted in computing the time of
suspension.25

The issue, as the Court understands it, consists of three questions: (1) Did the 1987 Constitution, in deleting the
phrase "as may be provided by law" intend to divest the President of the power to investigate, suspend, discipline,
and/or remove local officials? (2) Has the Constitution repealed Sections 62 and 63 of the Local Government Code?
(3) What is the significance of the change in the constitutional language?

It is the considered opinion of the Court that notwithstanding the change in the constitutional language, the charter
did not intend to divest the legislature of its right or the President of her prerogative as conferred by existing
legislation to provide administrative sanctions against local officials. It is our opinion that the omission (of "as may be
provided by law") signifies nothing more than to underscore local governments' autonomy from congress and to
break Congress' "control" over local government affairs. The Constitution did not, however, intend, for the sake of
local autonomy, to deprive the legislature of all authority over municipal corporations, in particular, concerning
discipline.

Autonomy does not, after all, contemplate making mini-states out of local government units, as in the federal
governments of the United States of America (or Brazil or Germany), although Jefferson is said to have compared
municipal corporations euphemistically to "small republics."26 Autonomy, in the constitutional sense, is subject to the
guiding star, though not control, of the legislature, albeit the legislative responsibility under the Constitution and as
the "supervision clause" itself suggest-is to wean local government units from over-dependence on the central
government.

It is noteworthy that under the Charter, "local autonomy" is not instantly self-executing, but subject to, among other
things, the passage of a local government code, 27 a local tax law,28 income distribution legislation, 29 and a national
representation law,30 and measures31 designed to realize autonomy at the local level. It is also noteworthy that in
spite of autonomy, the Constitution places the local government under the general supervision of the Executive. It is
noteworthy finally, that the Charter allows Congress to include in the local government code provisions for removal of
local officials, which suggest that Congress may exercise removal powers, and as the existing Local Government
Code has done, delegate its exercise to the President. Thus:

Sec. 3. The Congress shall enact a local government code which shall provide for a more responsive and
accountable local government structure instituted through a system of decentralization with effective mechanisms of
recall, initiative, and referendum, allocate among the different local government units their powers, responsibilities
and resources, and provide for the qualifications, election, appointment and removal, term, salaries, powers and
functions and duties of local officials, and all other matters relating to the organization and operation of the local
units.32

As hereinabove indicated, the deletion of "as may be provided by law" was meant to stress, sub silencio, the
objective of the framers to strengthen local autonomy by severing congressional control of its affairs, as observed by
the Court of Appeals, like the power of local legislation. 33 The Constitution did nothing more, however, and insofar as
existing legislation authorizes the President (through the Secretary of Local Government) to proceed against local
officials administratively, the Constitution contains no prohibition.

The petitioners are under the impression that the Constitution has left the President mere supervisory powers, which
supposedly excludes the power of investigation, and denied her control, which allegedly embraces disciplinary
authority. It is a mistaken impression because legally, "supervision" is not incompatible with disciplinary authority as
this Court has held,34 thus:

x x x           x x x          x x x

It is true that in the case of Mondano vs. Silvosa, 51 Off. Gaz., No. 6 p. 2884, this Court had occasion to discuss the
scope and extent of the power of supervision by the President over local government officials in contrast to the power
of control given to him over executive officials of our government wherein it was emphasized that the two terms,
control and supervision, are two different things which differ one from the other in meaning and extent. Thus in that
case the Court has made the following digression: "In administration law supervision means overseeing or the power
or authority of an officer to see that subordinate officers perform their duties. If the latter fail or neglect to fulfill them
the former may take such action or step as prescribed by law to make them perform their duties. Control, on the other
hand, means the power of an officer to alter or modify or nullify of set aside what a subordinate officer had done in
the performance of his duties and to substitute the judgment of the former for that of the latter." But from this
pronouncement it cannot be reasonably inferred that the power of supervision of the President over local government
officials does not include the power of investigation when in his opinion the good of the public service so requires, as
postulated in Section 64(c) of the Revised Administrative Code. ...35

x x x           x x x          x x x

"Control" has been defined as "the power of an officer to alter or modify or nullify or set aside what a subordinate
officer had done in the performance of his duties and to substitute the judgment of the former for test of the
latter."36"Supervision" on the other hand means "overseeing or the power or authority of an officer to see that
subordinate officers perform their duties. 37 As we held,38 however, "investigating" is not inconsistent with
"overseeing", although it is a lesser power than "altering". The impression is apparently exacerbated by the Court's
pronouncements in at least three cases, Lacson v. Roque,39 Hebron v. Reyes,40 and Mondano v. Silvosa,41 and
possibly, a fourth one, Pelaez v. Auditor General.42 In Lacson, this Court said that the President enjoyed no control
powers but only supervision "as may be provided by law," 43 a rule we reiterated in Hebron, and Mondano. In Pelaez,
we stated that the President "may not . . . suspend an elective official of a regular municipality or take any disciplinary
action against him, except on appeal from a decision of the corresponding provincial board." 44 However,
neither Lacsonnor Hebron nor Mondano categorically banned the Chief Executive from exercising acts of disciplinary
authority because she did not exercise control powers, but because no law allowed her to exercise disciplinary
authority. Thus, according to Lacson:

The contention that the President has inherent power to remove or suspend municipal officers is without doubt not
well taken. Removal and suspension of public officers are always controlled by the particular law applicable and its
proper construction subject to constitutional limitations.45

In Hebron we stated:

Accordingly, when the procedure for the suspension of an officer is specified by law, the same must be deemed
mandatory and adhered to strictly, in the absence of express or clear provision to the contrary-which does not et with
respect to municipal officers ...46

In Mondano, the Court held:

... The Congress has expressly and specifically lodged the provincial supervision over municipal officials in the
provincial governor who is authorized to "receive and investigate complaints made under oath against municipal
officers for neglect of duty, oppression, corruption or other form of maladministration of office, and conviction by final
judgment of any crime involving moral turpitude." And if the charges are serious, "he shall submit written charges
touching the matter to the provincial board, furnishing a copy of such charges to the accused either personally or by
registered mail, and he may in such case suspend the officer (not being the municipal treasurer) pending action by
the board, if in his opinion the charge by one affecting the official integrity of the officer in question." Section 86 of the
Revised Administration Code adds nothing to the power of supervision to be exercised by the Department Head over
the administration of ... municipalities ... . If it be construed that it does and such additional power is the same
authority as that vested in the Department Head by section 79(c) of the Revised Administrative Code, then such
additional power must be deemed to have been abrogated by Section 110(l), Article VII of the Constitution. 47

x x x           x x x          x x x

In Pelaez, we stated that the President can not impose disciplinary measures on local officials except on appeal from
the provincial board pursuant to the Administrative Code.48

Thus, in those case that this Court denied the President the power (to suspend/remove) it was not because we did
not think that the President can not exercise it on account of his limited power, but because the law lodged the power
elsewhere. But in those cases ii which the law gave him the power, the Court, as in  Ganzon v. Kayanan, found little
difficulty in sustaining him.49

The Court does not believe that the petitioners can rightfully point to the debates of the Constitutional Commission to
defeat the President's powers. The Court believes that the deliberations are by themselves inconclusive, because
although Commissioner Jose Nolledo would exclude the power of removal from the President, 50 Commissioner Blas
Ople would not.51

The Court is consequently reluctant to say that the new Constitution has repealed the Local Government Code,
Batas Blg. 37. As we said, "supervision" and "removal" are not incompatible terms and one may stand with the other
notwithstanding the stronger expression of local autonomy under the new Charter. We have indeed held that in spite
of the approval of the Charter, Batas Blg. 337 is still in force and effect. 52

As the Constitution itself declares, local autonomy means "a more responsive and accountable local government
structure instituted through a system of decentralization." 53 The Constitution as we observed, does nothing more than
to break up the monopoly of the national government over the affairs of local governments and as put by political
adherents, to "liberate the local governments from the imperialism of Manila." Autonomy, however, is not meant to
end the relation of partnership and inter-dependence between the central administration and local government units,
or otherwise, to user in a regime of federalism. The Charter has not taken such a radical step. Local governments,
under the Constitution, are subject to regulation, however limited, and for no other purpose than precisely, albeit
paradoxically, to enhance self- government.

As we observed in one case, 54 decentralization means devolution of national administration but not power to the local
levels. Thus:

Now, autonomy is either decentralization of administration or decentralization of power. There is decentralization of

administration when the central government delegates administrative powers to political subdivisions 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 the favor of local
governments 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. 55

The successive sixty-day suspensions imposed on Mayor Rodolfo Ganzon is albeit another matter. What bothers the
Court, and what indeed looms very large, is the fact that since the Mayor is facing ten administrative charges, the
Mayor is in fact facing the possibility of 600 days of suspension, in the event that all ten cases yield prima
faciefindings. The Court is not of course tolerating misfeasance in public office (assuming that Mayor Ganzon is guilty
of misfeasance) but it is certainly another question to make him serve 600 days of suspension, which is effectively, to
suspend him out of office. As we held:56

2. Petitioner is a duly elected municipal mayor of Lianga, Surigao del Sur. His term of office does not expire until
1986. Were it not for this information and the suspension decreed by the Sandiganbayan according to the Anti-Graft
and Corrupt Practices Act, he would have been all this while in the full discharge of his functions as such municipal
mayor. He was elected precisely to do so. As of October 26, 1983, he has been unable to. it is a basic assumption of
the electoral process implicit in the right of suffrage that the people are entitled to the services of elective officials of
their choice. For misfeasance or malfeasance, any of them could, of course, be proceeded against administratively
or, as in this instance, criminally. In either case, Ms culpability must be established. Moreover, if there be a criminal
action, he is entitled to the constitutional presumption of innocence. A preventive suspension may be justified. Its
continuance, however, for an unreasonable length of time raises a due process question. For even if thereafter he
were acquitted, in the meanwhile his right to hold office had been nullified. Clearly, there would be in such a case an
injustice suffered by him. Nor is he the only victim. There is injustice inflicted likewise on the people of Lianga They
were deprived of the services of the man they had elected to serve as mayor. In that sense, to paraphrase Justice
Cardozo, the protracted continuance of this preventive suspension had outrun the bounds of reason and resulted in
sheer oppression. A denial of due process is thus quite manifest. It is to avoid such an unconstitutional application
that the order of suspension should be lifted.57

The plain truth is that this Court has been ill at ease with suspensions, for the above reasons, 58 and so also, because
it is out of the ordinary to have a vacancy in local government. The sole objective of a suspension, as we have
held,59 is simply "to prevent the accused from hampering the normal cause of the investigation with his influence and
authority over possible witnesses"60 or to keep him off "the records and other evidence. 61

It is a means, and no more, to assist prosecutors in firming up a case, if any, against an erring local official. Under the
Local Government Code, it can not exceed sixty days, 62 which is to say that it need not be exactly sixty days long if a
shorter period is otherwise sufficient, and which is also to say that it ought to be lifted if prosecutors have achieved
their purpose in a shorter span.

Suspension is not a penalty and is not unlike preventive imprisonment in which the accused is held to insure his
presence at the trial. In both cases, the accused (the respondent) enjoys a presumption of innocence unless and until
found guilty.

Suspension finally is temporary and as the Local Government Code provides, it may be imposed for no more than
sixty days. As we held, 63 a longer suspension is unjust and unreasonable, and we might add, nothing less than
tyranny.

As we observed earlier, imposing 600 days of suspension which is not a remote possibility Mayor Ganzon is to all
intents and purposes, to make him spend the rest of his term in inactivity. It is also to make, to all intents and
purposes, his suspension permanent.

It is also, in fact, to mete out punishment in spite of the fact that the Mayor's guilt has not been proven. Worse, any
absolution will be for naught because needless to say, the length of his suspension would have, by the time he is
reinstated, wiped out his tenure considerably.

The Court is not to be mistaken for obstructing the efforts of the respondent Secretary to see that justice is done in
Iloilo City, yet it is hardly any argument to inflict on Mayor Ganzon successive suspensions when apparently, the
respondent Secretary has had sufficient time to gather the necessary evidence to build a case against the Mayor
without suspending him a day longer. What is intriguing is that the respondent Secretary has been cracking down, so
to speak, on the Mayor piecemeal apparently, to pin him down ten times the pain, when he, the respondent
Secretary, could have pursued a consolidated effort.
We reiterate that we are not precluding the President, through the Secretary of Interior from exercising a legal power,
yet we are of the opinion that the Secretary of Interior is exercising that power oppressively, and needless to say,
with a grave abuse of discretion.

The Court is aware that only the third suspension is under questions, and that any talk of future suspensions is in fact
premature. The fact remains, however, that Mayor Ganzon has been made to serve a total of 120 days of suspension
and the possibility of sixty days more is arguably around the corner (which amounts to a violation of the Local
Government Code which brings to light a pattern of suspensions intended to suspend the Mayor the rest of his
natural tenure. The Court is simply foreclosing what appears to us as a concerted effort of the State to perpetuate an
arbitrary act.

As we said, we can not tolerate such a state of affairs.

We are therefore allowing Mayor Rodolfo Ganzon to suffer the duration of his third suspension and lifting, for the
purpose, the Temporary Restraining Order earlier issued. Insofar as the seven remaining charges are concerned, we
are urging the Department of Local Government, upon the finality of this Decision, to undertake steps to expedite the
same, subject to Mayor Ganzon's usual remedies of appeal, judicial or administrative, or certiorari, if warranted, and
meanwhile, we are precluding the Secretary from meting out further suspensions based on those remaining
complaints, notwithstanding findings of prima facie evidence.

In resume the Court is laying down the following rules:

1. Local autonomy, under the Constitution, involves a mere decentralization of administration, not of power, in which
local officials remain accountable to the central government in the manner the law may provide;

2. The new Constitution does not prescribe federalism;

3. The change in constitutional language (with respect to the supervision clause) was meant but to deny legislative
control over local governments; it did not exempt the latter from legislative regulations provided regulation is
consistent with the fundamental premise of autonomy;

4. Since local governments remain accountable to the national authority, the latter may, by law, and in the manner
set forth therein, impose disciplinary action against local officials;

5. "Supervision" and "investigation" are not inconsistent terms; "investigation" does not signify "control" (which the
President does not have);

6. The petitioner, Mayor Rodolfo Ganzon. may serve the suspension so far ordered, but may no longer be suspended
for the offenses he was charged originally; provided:

a) that delays in the investigation of those charges "due to his fault, neglect or request, (the time of the delay) shall
not be counted in computing the time of suspension. [Supra, sec. 63(3)]

b) that if during, or after the expiration of, his preventive suspension, the petitioner commits another or other crimes
and abuses for which proper charges are filed against him by the aggrieved party or parties, his previous suspension
shall not be a bar to his being preventively suspended again, if warranted under subpar. (2), Section 63 of the Local
Government Code.

WHEREFORE, premises considered, the petitions are DISMISSED. The Temporary Restraining Order issued is
LIFTED.1âwphi1 The suspensions of the petitioners are AFFIRMED, provided that the petitioner, Mayor Rodolfo
Ganzon, may not be made to serve future suspensions on account of any of the remaining administrative charges
pending against him for acts committed prior to August 11, 1988. The Secretary of Interior is ORDERED to
consolidate all such administrative cases pending against Mayor Ganzon.

The sixty-day suspension against the petitioner, Mary Ann Rivera Artieda, is AFFIRMED. No costs.

SO ORDERED.
[G.R. No. 152774. May 27, 2004]

THE PROVINCE OF BATANGAS, represented by its Governor, HERMILANDO I. MANDANAS, petitioner,

vs. HON. ALBERTO G. ROMULO, Executive Secretary and Chairman of the Oversight Committee on
Devolution; HON. EMILIA BONCODIN, Secretary, Department of Budget and Management; HON.
JOSE D. LINA, JR., Secretary, Department of Interior and Local Government, respondents.

DECISION

CALLEJO, SR., J.:

The Province of Batangas, represented by its Governor, Hermilando I. Mandanas, filed the present petition
for certiorari, prohibition and mandamus under Rule 65 of the Rules of Court, as amended, to declare as
unconstitutional and void certain provisos contained in the General Appropriations Acts (GAA) of 1999, 2000 and
2001, insofar as they uniformly earmarked for each corresponding year the amount of five billion pesos
(P5,000,000,000.00) of the Internal Revenue Allotment (IRA) for the Local Government Service Equalization Fund
(LGSEF) and imposed conditions for the release thereof.

Named as respondents are Executive Secretary Alberto G. Romulo, in his capacity as Chairman of the
Oversight Committee on Devolution, Secretary Emilia Boncodin of the Department of Budget and Management
(DBM) and Secretary Jose Lina of the Department of Interior and Local Government (DILG).

Background

On December 7, 1998, then President Joseph Ejercito Estrada issued Executive Order (E.O.) No. 48 entitled
ESTABLISHING A PROGRAM FOR DEVOLUTION ADJUSTMENT AND EQUALIZATION. The program was
established to facilitate the process of enhancing the capacities of local government units (LGUs) in the discharge of
the functions and services devolved to them by the National Government Agencies concerned pursuant to the Local
Government Code.[1] The Oversight Committee (referred to as the Devolution Committee in E.O. No. 48) constituted
under Section 533(b) of Republic Act No. 7160 (The Local Government Code of 1991) has been tasked to formulate
and issue the appropriate rules and regulations necessary for its effective implementation. [2] Further, to address the
funding shortfalls of functions and services devolved to the LGUs and other funding requirements of the program, the
Devolution Adjustment and Equalization Fund was created. [3] For 1998, the DBM was directed to set aside an amount
to be determined by the Oversight Committee based on the devolution status appraisal surveys undertaken by the
DILG.[4] The initial fund was to be sourced from the available savings of the national government for CY 1998. [5] For
1999 and the succeeding years, the corresponding amount required to sustain the program was to be incorporated in
the annual GAA.[6] The Oversight Committee has been authorized to issue the implementing rules and regulations
governing the equitable allocation and distribution of said fund to the LGUs. [7]

The LGSEF in the GAA of 1999

In Republic Act No. 8745, otherwise known as the GAA of 1999, the program was renamed as the LOCAL
GOVERNMENT SERVICE EQUALIZATION FUND (LGSEF). Under said appropriations law, the amount
of P96,780,000,000 was allotted as the share of the LGUs in the internal revenue taxes.  Item No. 1, Special
Provisions, Title XXXVI A. Internal Revenue Allotment of Rep. Act No. 8745 contained the following proviso:

... PROVIDED, That the amount of FIVE BILLION PESOS (P5,000,000,000) shall be earmarked for the Local
Government Service Equalization Fund for the funding requirements of projects and activities arising from the full and
efficient implementation of devolved functions and services of local government units pursuant to R.A. No. 7160,
otherwise known as the Local Government Code of 1991: PROVIDED, FURTHER, That such amount shall be
released to the local government units subject to the implementing rules and regulations, including such mechanisms
and guidelines for the equitable allocations and distribution of said fund among local government units subject to the
guidelines that may be prescribed by the Oversight Committee on Devolution as constituted pursuant to Book IV,
Title III, Section 533(b) of R.A. No. 7160. The Internal Revenue Allotment shall be released directly by the
Department of Budget and Management to the Local Government Units concerned.

On July 28, 1999, the Oversight Committee (with then Executive Secretary Ronaldo B. Zamora as Chairman)
passed Resolution Nos. OCD-99-003, OCD-99-005 and OCD-99-006 entitled as follows:

OCD-99-005

RESOLUTION ADOPTING THE ALLOCATION SCHEME FOR THE PhP5 BILLION CY 1999 LOCAL
GOVERNMENT SERVICE EQUALIZATION FUND (LGSEF) AND REQUESTING HIS
EXCELLENCY PRESIDENT JOSEPH EJERCITO ESTRADA TO APPROVE SAID ALLOCATION
SCHEME.

OCD-99-006

RESOLUTION ADOPTING THE ALLOCATION SCHEME FOR THE PhP4.0 BILLION OF THE 1999
LOCAL GOVERNMENT SERVICE EQUALIZATION FUND AND ITS CONCOMITANT GENERAL
FRAMEWORK, IMPLEMENTING GUIDELINES AND MECHANICS FOR ITS IMPLEMENTATION
AND RELEASE, AS PROMULGATED BY THE OVERSIGHT COMMITTEE ON DEVOLUTION.

OCD-99-003

RESOLUTION REQUESTING HIS EXCELLENCY PRESIDENT JOSEPH EJERCITO ESTRADA TO

APPROVE THE REQUEST OF THE OVERSIGHT COMMITTEE ON DEVOLUTION TO SET ASIDE
TWENTY PERCENT (20%) OF THE LOCAL GOVERNMENT SERVICE EQUALIZATION FUND
(LGSEF) FOR LOCAL AFFIRMATIVE ACTION PROJECTS AND OTHER PRIORITY INITIATIVES
FOR LGUs INSTITUTIONAL AND CAPABILITY BUILDING IN ACCORDANCE WITH THE
IMPLEMENTING GUIDELINES AND MECHANICS AS PROMULGATED BY THE COMMITTEE.

These OCD resolutions were approved by then President Estrada on October 6, 1999.

Under the allocation scheme adopted pursuant to Resolution No. OCD-99-005, the five billion pesos LGSEF
was to be allocated as follows:

1. The PhP4 Billion of the LGSEF shall be allocated in accordance with the allocation scheme and
implementing guidelines and mechanics promulgated and adopted by the OCD. To wit:

a. The first PhP2 Billion of the LGSEF shall be allocated in accordance with the codal formula sharing
scheme as prescribed under the 1991 Local Government Code;

b. The second PhP2 Billion of the LGSEF shall be allocated in accordance with a modified 1992 cost of
devolution fund (CODEF) sharing scheme, as recommended by the respective leagues of
provinces, cities and municipalities to the OCD. The modified CODEF sharing formula is as
follows:

Province : 40%

Cities : 20%

Municipalities : 40%

This is applied to the P2 Billion after the approved amounts granted to individual provinces, cities
and municipalities as assistance to cover decrease in 1999 IRA share due to reduction in land
area have been taken out.

2. The remaining PhP1 Billion of the LGSEF shall be earmarked to support local affirmative action
projects and other priority initiatives submitted by LGUs to the Oversight Committee on Devolution
for approval in accordance with its prescribed guidelines as promulgated and adopted by the OCD.

In Resolution No. OCD-99-003, the Oversight Committee set aside the one billion pesos or 20% of the LGSEF
to support Local Affirmative Action Projects (LAAPs) of LGUs. This remaining amount was intended to respond to the
urgent need for additional funds assistance, otherwise not available within the parameters of other existing fund
sources. For LGUs to be eligible for funding under the one-billion-peso portion of the LGSEF, the OCD promulgated
the following:
III. CRITERIA FOR ELIGIBILITY:

1. LGUs (province, city, municipality, or barangay), individually or by group or multi-LGUs or leagues of

LGUs, especially those belonging to the 5th and 6th class, may access the fund to support any
projects or activities that satisfy any of the aforecited purposes. A barangay may also access this
fund directly or through their respective municipality or city.

2. The proposed project/activity should be need-based, a local priority, with high development impact and
are congruent with the socio-cultural, economic and development agenda of the Estrada
Administration, such as food security, poverty alleviation, electrification, and peace and order,
among others.

3. Eligible for funding under this fund are projects arising from, but not limited to, the following areas of
concern:

a. delivery of local health and sanitation services, hospital services and other tertiary services;

b. delivery of social welfare services;

c. provision of socio-cultural services and facilities for youth and community development;

d. provision of agricultural and on-site related research;

e. improvement of community-based forestry projects and other local projects on environment

and natural resources protection and conservation;

f. improvement of tourism facilities and promotion of tourism;

g. peace and order and public safety;

h. construction, repair and maintenance of public works and infrastructure, including public
buildings and facilities for public use, especially those destroyed or damaged by man-
made or natural calamities and disaster as well as facilities for water supply, flood
control and river dikes;

i. provision of local electrification facilities;

j. livelihood and food production services, facilities and equipment;

k. other projects that may be authorized by the OCD consistent with the aforementioned
objectives and guidelines;

4. Except on extremely meritorious cases, as may be determined by the Oversight Committee on

Devolution, this portion of the LGSEF shall not be used in expenditures for personal costs or
benefits under existing laws applicable to governments. Generally, this fund shall cover the
following objects of expenditures for programs, projects and activities arising from the
implementation of devolved and regular functions and services:

a. acquisition/procurement of supplies and materials critical to the full and effective

implementation of devolved programs, projects and activities;

b. repair and/or improvement of facilities;

c. repair and/or upgrading of equipment;

d. acquisition of basic equipment;

e. construction of additional or new facilities;

 f. counterpart contribution to joint arrangements or collective projects among groups of
municipalities, cities and/or provinces related to devolution and delivery of basic
services.

5. To be eligible for funding, an LGU or group of LGU shall submit to the Oversight Committee on
Devolution through the Department of Interior and Local Governments, within the prescribed
schedule and timeframe, a Letter Request for Funding Support from the Affirmative Action
Program under the LGSEF, duly signed by the concerned LGU(s) and endorsed by cooperators
and/or beneficiaries, as well as the duly signed Resolution of Endorsement by the respective
Sanggunian(s) of the LGUs concerned. The LGU-proponent shall also be required to submit the
Project Request (PR), using OCD Project Request Form No. 99-02, that details the following:

(a) general description or brief of the project;

(b) objectives and justifications for undertaking the project, which should highlight the benefits to
the locality and the expected impact to the local program/project arising from the full
and efficient implementation of social services and facilities, at the local levels;

(c) target outputs or key result areas;

(d) schedule of activities and details of requirements;

(e) total cost requirement of the project;

(f) proponents counterpart funding share, if any, and identified source(s) of counterpart funds for
the full implementation of the project;

(g) requested amount of project cost to be covered by the LGSEF.

Further, under the guidelines formulated by the Oversight Committee as contained in Attachment - Resolution
No. OCD-99-003, the LGUs were required to identify the projects eligible for funding under the one-billion-peso
portion of the LGSEF and submit the project proposals thereof and other documentary requirements to the DILG for
appraisal. The project proposals that passed the DILGs appraisal would then be submitted to the Oversight
Committee for review, evaluation and approval. Upon its approval, the Oversight Committee would then serve notice
to the DBM for the preparation of the Special Allotment Release Order (SARO) and Notice of Cash Allocation (NCA)
to effect the release of funds to the said LGUs.

The LGSEF in the GAA of 2000

Under Rep. Act No. 8760, otherwise known as the GAA of 2000, the amount of P111,778,000,000 was allotted
as the share of the LGUs in the internal revenue taxes. As in the GAA of 1999, the GAA of 2000 contained a proviso
earmarking five billion pesos of the IRA for the LGSEF. This proviso, found in Item No. 1, Special Provisions, Title
XXXVII A. Internal Revenue Allotment, was similarly worded as that contained in the GAA of 1999.

The Oversight Committee, in its Resolution No. OCD-2000-023 dated June 22, 2000, adopted the following
allocation scheme governing the five billion pesos LGSEF for 2000:

1. The PhP3.5 Billion of the CY 2000 LGSEF shall be allocated to and shared by the four levels of LGUs,
i.e., provinces, cities, municipalities, and barangays, using the following percentage-sharing
formula agreed upon and jointly endorsed by the various Leagues of LGUs:

For Provinces 26% or P 910,000,000

For Cities 23% or 805,000,000

For Municipalities 35% or 1,225,000,000

For Barangays 16% or 560,000,000

Provided that the respective Leagues representing the provinces, cities, municipalities and
barangays shall draw up and adopt the horizontal distribution/sharing schemes among the
 member LGUs whereby the Leagues concerned may opt to adopt direct financial assistance or
project-based arrangement, such that the LGSEF allocation for individual LGU shall be released
directly to the LGU concerned;

Provided further that the individual LGSEF shares to LGUs are used in accordance with the
general purposes and guidelines promulgated by the OCD for the implementation of the LGSEF
at the local levels pursuant to Res. No. OCD-99-006 dated October 7, 1999 and pursuant to the
Leagues guidelines and mechanism as approved by the OCD;

Provided further that each of the Leagues shall submit to the OCD for its approval their
respective allocation scheme, the list of LGUs with the corresponding LGSEF shares and the
corresponding project categories if project-based;

Provided further that upon approval by the OCD, the lists of LGUs shall be endorsed to the DBM
as the basis for the preparation of the corresponding NCAs, SAROs, and related budget/release
documents.

2. The remaining P1,500,000,000 of the CY 2000 LGSEF shall be earmarked to support the following
initiatives and local affirmative action projects, to be endorsed to and approved by the Oversight
Committee on Devolution in accordance with the OCD agreements, guidelines, procedures and
documentary requirements:

On July 5, 2000, then President Estrada issued a Memorandum authorizing then Executive Secretary Zamora
and the DBM to implement and release the 2.5 billion pesos LGSEF for 2000 in accordance with Resolution No.
OCD-2000-023.

Thereafter, the Oversight Committee, now under the administration of President Gloria Macapagal-Arroyo,
promulgated Resolution No. OCD-2001-29 entitled ADOPTING RESOLUTION NO. OCD-2000-023 IN THE
ALLOCATION, IMPLEMENTATION AND RELEASE OF THE REMAINING P2.5 BILLION LGSEF FOR CY
2000. Under this resolution, the amount of one billion pesos of the LGSEF was to be released in accordance with
paragraph 1 of Resolution No. OCD-2000-23, to complete the 3.5 billion pesos allocated to the LGUs, while the
amount of 1.5 billion pesos was allocated for the LAAP. However, out of the latter amount, P400,000,000 was to be
allocated and released as follows: P50,000,000 as financial assistance to the LAAPs of LGUs; P275,360,227 as
financial assistance to cover the decrease in the IRA of LGUs concerned due to reduction in land area;
and P74,639,773 for the LGSEF Capability-Building Fund.

The LGSEF in the GAA of 2001

In view of the failure of Congress to enact the general appropriations law for 2001, the GAA of 2000 was
deemed re-enacted, together with the IRA of the LGUs therein and the proviso earmarking five billion pesos thereof
for the LGSEF.

On January 9, 2002, the Oversight Committee adopted Resolution No. OCD-2002-001 allocating the five billion
pesos LGSEF for 2001 as follows:

Modified Codal Formula P 3.000 billion

Priority Projects 1.900 billion

Capability Building Fund .100 billion

P 5.000 billion

RESOLVED FURTHER, that the P3.0 B of the CY 2001 LGSEF which is to be allocated according to the modified
codal formula shall be released to the four levels of LGUs, i.e., provinces, cities, municipalities and barangays, as
follows:

LGUs Percentage Amount

Provinces 25 P 0.750 billion

Cities 25 0.750
Municipalities 35 1.050

Barangays 15 0.450

100 P 3.000 billion

RESOLVED FURTHER, that the P1.9 B earmarked for priority projects shall be distributed according to the following
criteria:

1.0 For projects of the 4th, 5th and 6th class LGUs; or

2.0 Projects in consonance with the Presidents State of the Nation Address (SONA)/summit
commitments.

RESOLVED FURTHER, that the remaining P100 million LGSEF capability building fund shall be distributed in
accordance with the recommendation of the Leagues of Provinces, Cities, Municipalities and Barangays, and
approved by the OCD.

Upon receipt of a copy of the above resolution, Gov. Mandanas wrote to the individual members of the
Oversight Committee seeking the reconsideration of Resolution No. OCD-2002-001. He also wrote to Pres.
Macapagal-Arroyo urging her to disapprove said resolution as it violates the Constitution and the Local Government
Code of 1991.

On January 25, 2002, Pres. Macapagal-Arroyo approved Resolution No. OCD-2002-001.

The Petitioners Case

The petitioner now comes to this Court assailing as unconstitutional and void the provisos in the GAAs of 1999,
2000 and 2001, relating to the LGSEF. Similarly assailed are the Oversight Committees Resolutions Nos. OCD-99-
003, OCD-99-005, OCD-99-006, OCD-2000-023, OCD-2001-029 and OCD-2002-001 issued pursuant thereto. The
petitioner submits that the assailed provisos in the GAAs and the OCD resolutions, insofar as they earmarked the
amount of five billion pesos of the IRA of the LGUs for 1999, 2000 and 2001 for the LGSEF and imposed conditions
for the release thereof, violate the Constitution and the Local Government Code of 1991.

Section 6, Article X of the Constitution is invoked as it mandates that the just share of the LGUs shall be
automatically released to them. Sections 18 and 286 of the Local Government Code of 1991, which enjoin that the
just share of the LGUs shall be automatically and directly released to them without need of further action are,
likewise, cited.

The petitioner posits that to subject the distribution and release of the five-billion-peso portion of the IRA,
classified as the LGSEF, to compliance by the LGUs with the implementing rules and regulations, including the
mechanisms and guidelines prescribed by the Oversight Committee, contravenes the explicit directive of the
Constitution that the LGUs share in the national taxes shall be automatically released to them. The petitioner
maintains that the use of the word shall must be given a compulsory meaning.

To further buttress this argument, the petitioner contends that to vest the Oversight Committee with the
authority to determine the distribution and release of the LGSEF, which is a part of the IRA of the LGUs, is an
anathema to the principle of local autonomy as embodied in the Constitution and the Local Government Code of
1991. The petitioner cites as an example the experience in 2001 when the release of the LGSEF was long delayed
because the Oversight Committee was not able to convene that year and no guidelines were issued therefor. Further,
the possible disapproval by the Oversight Committee of the project proposals of the LGUs would result in the
diminution of the latters share in the IRA.

Another infringement alleged to be occasioned by the assailed OCD resolutions is the improper amendment to
Section 285 of the Local Government Code of 1991 on the percentage sharing of the IRA among the LGUs.  Said
provision allocates the IRA as follows: Provinces 23%; Cities 23%; Municipalities 34%; and Barangays 20%. [8] This
formula has been improperly amended or modified, with respect to the five-billion-peso portion of the IRA allotted for
the LGSEF, by the assailed OCD resolutions as they invariably provided for a different sharing scheme.

The modifications allegedly constitute an illegal amendment by the executive branch of a substantive
law. Moreover, the petitioner mentions that in the Letter dated December 5, 2001 of respondent Executive Secretary
Romulo addressed to respondent Secretary Boncodin, the former endorsed to the latter the release of funds to
certain LGUs from the LGSEF in accordance with the handwritten instructions of President Arroyo. Thus, the LGUs
are at a loss as to how a portion of the LGSEF is actually allocated.  Further, there are still portions of the LGSEF
that, to date, have not been received by the petitioner; hence, resulting in damage and injury to the petitioner.
 The petitioner prays that the Court declare as unconstitutional and void the assailed provisos relating to the
LGSEF in the GAAs of 1999, 2000 and 2001 and the assailed OCD resolutions (Resolutions Nos. OCD-99-003,
OCD-99-005, OCD-99-006, OCD-2000-023, OCD-2001-029 and OCD-2002-001) issued by the Oversight Committee
pursuant thereto. The petitioner, likewise, prays that the Court direct the respondents to rectify the unlawful and
illegal distribution and releases of the LGSEF for the aforementioned years and release the same in accordance with
the sharing formula under Section 285 of the Local Government Code of 1991. Finally, the petitioner urges the Court
to declare that the entire IRA should be released automatically without further action by the LGUs as required by the
Constitution and the Local Government Code of 1991.

The Respondents Arguments

The respondents, through the Office of the Solicitor General, urge the Court to dismiss the petition on
procedural and substantive grounds. On the latter, the respondents contend that the assailed provisos in the GAAs of
1999, 2000 and 2001 and the assailed resolutions issued by the Oversight Committee are not constitutionally
infirm. The respondents advance the view that Section 6, Article X of the Constitution does not specify that the just
share of the LGUs shall be determined solely by the Local Government Code of 1991. Moreover, the phrase as
determined by law in the same constitutional provision means that there exists no limitation on the power of
Congress to determine what is the just share of the LGUs in the national taxes.In other words, Congress is the arbiter
of what should be the just share of the LGUs in the national taxes.

The respondents further theorize that Section 285 of the Local Government Code of 1991, which provides for
the percentage sharing of the IRA among the LGUs, was not intended to be a fixed determination of their just share
in the national taxes. Congress may enact other laws, including appropriations laws such as the GAAs of 1999, 2000
and 2001, providing for a different sharing formula. Section 285 of the Local Government Code of 1991 was merely
intended to be the default share of the LGUs to do away with the need to determine annually by law their just
share. However, the LGUs have no vested right in a permanent or fixed percentage as Congress may increase or
decrease the just share of the LGUs in accordance with what it believes is appropriate for their operation. There is
nothing in the Constitution which prohibits Congress from making such determination through the appropriations
laws. If the provisions of a particular statute, the GAA in this case, are within the constitutional power of the
legislature to enact, they should be sustained whether the courts agree or not in the wisdom of their enactment.

On procedural grounds, the respondents urge the Court to dismiss the petition outright as the same is
defective. The petition allegedly raises factual issues which should be properly threshed out in the lower courts, not
this Court, not being a trier of facts. Specifically, the petitioners allegation that there are portions of the LGSEF that it
has not, to date, received, thereby causing it (the petitioner) injury and damage, is subject to proof and must be
substantiated in the proper venue, i.e., the lower courts.

Further, according to the respondents, the petition has already been rendered moot and academic as it no
longer presents a justiciable controversy. The IRAs for the years 1999, 2000 and 2001, have already been released
and the government is now operating under the 2003 budget. In support of this, the respondents submitted
certifications issued by officers of the DBM attesting to the release of the allocation or shares of the petitioner in the
LGSEF for 1999, 2000 and 2001. There is, therefore, nothing more to prohibit.

Finally, the petitioner allegedly has no legal standing to bring the suit because it has not suffered any injury.  In
fact, the petitioners just share has even increased. Pursuant to Section 285 of the Local Government Code of 1991,
the share of the provinces is 23%. OCD Nos. 99-005, 99-006 and 99-003 gave the provinces 40% of P2 billion of the
LGSEF. OCD Nos. 2000-023 and 2001-029 apportioned 26% of P3.5 billion to the provinces. On the other hand,
OCD No. 2001-001 allocated 25% of P3 billion to the provinces. Thus, the petitioner has not suffered any injury in the
implementation of the assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions.

The Ruling of the Court

Procedural Issues

Before resolving the petition on its merits, the Court shall first rule on the following procedural issues raised by
the respondents: (1) whether the petitioner has legal standing or locus standi to file the present suit; (2) whether the
petition involves factual questions that are properly cognizable by the lower courts; and (3) whether the issue had
been rendered moot and academic.

The petitioner has locus standi

to maintain the present suit

The gist of the question of standing is whether a party has alleged such a personal stake in the outcome of the
controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court
so largely depends for illumination of difficult constitutional questions. [9] Accordingly, it has been held that the interest
of a party assailing the constitutionality of a statute must be direct and personal. Such party must be able to show,
not only that the law or any government act is invalid, but also that he has sustained or is in imminent danger of
sustaining some direct injury as a result of its enforcement, and not merely that he suffers thereby in some indefinite
way. It must appear that the person complaining has been or is about to be denied some right or privilege to which he
is lawfully entitled or that he is about to be subjected to some burdens or penalties by reason of the statute or act
complained of.[10]

The Court holds that the petitioner possesses the requisite standing to maintain the present suit. The petitioner,
a local government unit, seeks relief in order to protect or vindicate an interest of its own, and of the other LGUs. This
interest pertains to the LGUs share in the national taxes or the IRA. The petitioners constitutional claim is, in
substance, that the assailed provisos in the GAAs of 1999, 2000 and 2001, and the OCD resolutions contravene
Section 6, Article X of the Constitution, mandating the automatic release to the LGUs of their share in the national
taxes. Further, the injury that the petitioner claims to suffer is the diminution of its share in the IRA, as provided under
Section 285 of the Local Government Code of 1991, occasioned by the implementation of the assailed
measures. These allegations are sufficient to grant the petitioner standing to question the validity of the assailed
provisos in the GAAs of 1999, 2000 and 2001, and the OCD resolutions as the petitioner clearly has a plain, direct
and adequate interest in the manner and distribution of the IRA among the LGUs.

The petition involves a significant

legal issue

The crux of the instant controversy is whether the assailed provisos contained in the GAAs of 1999, 2000 and
2001, and the OCD resolutions infringe the Constitution and the Local Government Code of 1991.  This is
undoubtedly a legal question. On the other hand, the following facts are not disputed:

1. The earmarking of five billion pesos of the IRA for the LGSEF in the assailed provisos in the GAAs of
1999, 2000 and re-enacted budget for 2001;

2. The promulgation of the assailed OCD resolutions providing for the allocation schemes covering the
said five billion pesos and the implementing rules and regulations therefor; and

3. The release of the LGSEF to the LGUs only upon their compliance with the implementing rules and
regulations, including the guidelines and mechanisms, prescribed by the Oversight Committee.

Considering that these facts, which are necessary to resolve the legal question now before this Court, are no
longer in issue, the same need not be determined by a trial court. [11] In any case, the rule on hierarchy of courts will
not prevent this Court from assuming jurisdiction over the petition. The said rule may be relaxed when the redress
desired cannot be obtained in the appropriate courts or where exceptional and compelling circumstances justify
availment of a remedy within and calling for the exercise of this Courts primary jurisdiction. [12]

The crucial legal issue submitted for resolution of this Court entails the proper legal interpretation of
constitutional and statutory provisions. Moreover, the transcendental importance of the case, as it necessarily
involves the application of the constitutional principle on local autonomy, cannot be gainsaid. The nature of the
present controversy, therefore, warrants the relaxation by this Court of procedural rules in order to resolve the case
forthwith.

The substantive issue needs to be resolved

notwithstanding the supervening events

Granting arguendo that, as contended by the respondents, the resolution of the case had already been
overtaken by supervening events as the IRA, including the LGSEF, for 1999, 2000 and 2001, had already been
released and the government is now operating under a new appropriations law, still, there is compelling reason for
this Court to resolve the substantive issue raised by the instant petition. Supervening events, whether intended or
accidental, cannot prevent the Court from rendering a decision if there is a grave violation of the Constitution. [13] Even
in cases where supervening events had made the cases moot, the Court did not hesitate to resolve the legal or
constitutional issues raised to formulate controlling principles to guide the bench, bar and public. [14]
 Another reason justifying the resolution by this Court of the substantive issue now before it is the rule that
courts will decide a question otherwise moot and academic if it is capable of repetition, yet evading review. [15] For the
GAAs in the coming years may contain provisos similar to those now being sought to be invalidated, and yet, the
question may not be decided before another GAA is enacted. It, thus, behooves this Court to make a categorical
ruling on the substantive issue now.

Substantive Issue

As earlier intimated, the resolution of the substantive legal issue in this case calls for the application of a most
important constitutional policy and principle, that of local autonomy. [16] In Article II of the Constitution, the State has
expressly adopted as a policy that:

Section 25. The State shall ensure the autonomy of local governments.

An entire article (Article X) of the Constitution has been devoted to guaranteeing and promoting the autonomy
of LGUs. Section 2 thereof reiterates the State policy in this wise:

Section 2. The territorial and political subdivisions shall enjoy local autonomy.

Consistent with the principle of local autonomy, the Constitution confines the Presidents power over the LGUs
to one of general supervision. [17] This provision has been interpreted to exclude the power of control. The distinction
between the two powers was enunciated in Drilon v. Lim:[18]

An officer in control lays down the rules in the doing of an act. If they are not followed, he may, in his discretion, order
the act undone or re-done by his subordinate or he may even decide to do it himself.Supervision does not cover such
authority. The supervisor or superintendent merely sees to it that the rules are followed, but he himself does not lay
down such rules, nor does he have the discretion to modify or replace them. If the rules are not observed, he may
order the work done or re-done but only to conform to the prescribed rules. He may not prescribe his own manner for
doing the act. He has no judgment on this matter except to see to it that the rules are followed. [19]

The Local Government Code of 1991 [20] was enacted to flesh out the mandate of the Constitution. [21] The State
policy on local autonomy is amplified in Section 2 thereof:

Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State that the territorial and political
subdivisions of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest
development as self-reliant communities and make them more effective partners in the attainment of national
goals. Toward this end, the State shall provide for a more responsive and accountable local government structure
instituted through a system of decentralization whereby local government units shall be given more powers, authority,
responsibilities, and resources. The process of decentralization shall proceed from the National Government to the
local government units.

Guided by these precepts, the Court shall now determine whether the assailed provisos in the GAAs of 1999,
2000 and 2001, earmarking for each corresponding year the amount of five billion pesos of the IRA for the LGSEF
and the OCD resolutions promulgated pursuant thereto, transgress the Constitution and the Local Government Code
of 1991.

The assailed provisos in the GAAs of 1999, 2000

and 2001 and the OCD resolutions violate the

constitutional precept on local autonomy

Section 6, Article X of the Constitution reads:

Sec. 6. Local government units shall have a just share, as determined by law, in the national taxes which shall
be automatically released to them.
 When parsed, it would be readily seen that this provision mandates that (1) the LGUs shall have a just share in
the national taxes; (2) the just share shall be determined by law; and (3) the just share shall be automatically
released to the LGUs.

The Local Government Code of 1991, among its salient provisions, underscores the automatic release of the
LGUs just share in this wise:

Sec. 18. Power to Generate and Apply Resources. Local government units shall have the power and authority to
establish an organization that shall be responsible for the efficient and effective implementation of their development
plans, program objectives and priorities; to create their own sources of revenue and to levy taxes, fees, and charges
which shall accrue exclusively for their use and disposition and which shall be retained by them; to have a just share
in national taxes which shall be automatically and directly released to them without need of further action;

...

Sec. 286. Automatic Release of Shares. (a) The share of each local government unit shall be released, without need
of any further action, directly to the provincial, city, municipal or barangay treasurer, as the case may be, on a
quarterly basis within five (5) days after the end of each quarter, and which shall not be subject to any lien or
holdback that may be imposed by the national government for whatever purpose.

(b) Nothing in this Chapter shall be understood to diminish the share of local government units under existing laws.

Websters Third New International Dictionary defines automatic as involuntary either wholly or to a major extent
so that any activity of the will is largely negligible; of a reflex nature; without volition; mechanical; like or suggestive of
an automaton. Further, the word automatically is defined as in an automatic manner: without thought or conscious
intention. Being automatic, thus, connotes something mechanical, spontaneous and perfunctory. As such, the LGUs
are not required to perform any act to receive the just share accruing to them from the national coffers. As
emphasized by the Local Government Code of 1991, the just share of the LGUs shall be released to them without
need of further action. Construing Section 286 of the LGC, we held in Pimentel, Jr. v. Aguirre,[22] viz:

Section 4 of AO 372 cannot, however, be upheld. A basic feature of local fiscal autonomy is the automatic release of
the shares of LGUs in the National internal revenue. This is mandated by no less than the Constitution. The Local
Government Code specifies further that the release shall be made directly to the LGU concerned within five (5) days
after every quarter of the year and shall not be subject to any lien or holdback that may be imposed by the national
government for whatever purpose. As a rule, the term SHALL is a word of command that must be given a
compulsory meaning. The provision is, therefore, IMPERATIVE.

Section 4 of AO 372, however, orders the withholding, effective January 1, 1998, of 10 percent of the LGUs IRA
pending the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal
situation in the country. Such withholding clearly contravenes the Constitution and the law. Although temporary, it is
equivalent to a holdback, which means something held back or withheld, often temporarily. Hence, the temporary
nature of the retention by the national government does not matter. Any retention is prohibited.

In sum, while Section 1 of AO 372 may be upheld as an advisory effected in times of national crisis, Section 4 thereof
has no color of validity at all. The latter provision effectively encroaches on the fiscal autonomy of local
governments. Concededly, the President was well-intentioned in issuing his Order to withhold the LGUs IRA, but the
rule of law requires that even the best intentions must be carried out within the parameters of the Constitution and the
law. Verily, laudable purposes must be carried out by legal methods.[23]

The just share of the LGUs is incorporated as the IRA in the appropriations law or GAA enacted by Congress
annually. Under the assailed provisos in the GAAs of 1999, 2000 and 2001, a portion of the IRA in the amount of five
billion pesos was earmarked for the LGSEF, and these provisos imposed the condition that such amount shall be
released to the local government units subject to the implementing rules and regulations, including such mechanisms
and guidelines for the equitable allocations and distribution of said fund among local government units subject to the
guidelines that may be prescribed by the Oversight Committee on Devolution. Pursuant thereto, the Oversight
Committee, through the assailed OCD resolutions, apportioned the five billion pesos LGSEF such that:

For 1999

P2 billion - allocated according to Sec. 285 LGC

P2 billion - Modified Sharing Formula (Provinces 40%;

Cities 20%; Municipalities 40%)

P1 billion projects (LAAP) approved by OCD.[24]

For 2000

P3.5 billion Modified Sharing Formula (Provinces 26%;

Cities 23%; Municipalities 35%; Barangays 16%);

P1.5 billion projects (LAAP) approved by the OCD.[25]

For 2001

P3 billion Modified Sharing Formula (Provinces 25%;

Cities 25%; Municipalities 35%; Barangays 15%)

P1.9 billion priority projects

P100 million capability building fund.[26]

Significantly, the LGSEF could not be released to the LGUs without the Oversight Committees prior
approval. Further, with respect to the portion of the LGSEF allocated for various projects of the LGUs ( P1 billion for
1999; P1.5 billion for 2000 and P2 billion for 2001), the Oversight Committee, through the assailed OCD resolutions,
laid down guidelines and mechanisms that the LGUs had to comply with before they could avail of funds from this
portion of the LGSEF. The guidelines required (a) the LGUs to identify the projects eligible for funding based on the
criteria laid down by the Oversight Committee; (b) the LGUs to submit their project proposals to the DILG for
appraisal; (c) the project proposals that passed the appraisal of the DILG to be submitted to the Oversight Committee
for review, evaluation and approval. It was only upon approval thereof that the Oversight Committee would direct the
DBM to release the funds for the projects.

To the Courts mind, the entire process involving the distribution and release of the LGSEF is constitutionally
impermissible. The LGSEF is part of the IRA or just share of the LGUs in the national taxes.  To subject its distribution
and release to the vagaries of the implementing rules and regulations, including the guidelines and mechanisms
unilaterally prescribed by the Oversight Committee from time to time, as sanctioned by the assailed provisos in the
GAAs of 1999, 2000 and 2001 and the OCD resolutions, makes the release not automatic, a flagrant violation of the
constitutional and statutory mandate that the just share of the LGUs shall be automatically released to them. The
LGUs are, thus, placed at the mercy of the Oversight Committee.

Where the law, the Constitution in this case, is clear and unambiguous, it must be taken to mean exactly what it
says, and courts have no choice but to see to it that the mandate is obeyed. [27] Moreover, as correctly posited by the
petitioner, the use of the word shall connotes a mandatory order. Its use in a statute denotes an imperative obligation
and is inconsistent with the idea of discretion. [28]

Indeed, the Oversight Committee exercising discretion, even control, over the distribution and release of a
portion of the IRA, the LGSEF, is an anathema to and subversive of the principle of local autonomy as embodied in
the Constitution. Moreover, it finds no statutory basis at all as the Oversight Committee was created merely to
formulate the rules and regulations for the efficient and effective implementation of the Local Government Code of
1991 to ensure compliance with the principles of local autonomy as defined under the Constitution. [29] In fact, its
creation was placed under the title of Transitory Provisions, signifying its ad hoc character. According to Senator
Aquilino Q. Pimentel, the principal author and sponsor of the bill that eventually became Rep. Act No. 7160, the
Committees work was supposed to be done a year from the approval of the Code, or on October 10, 1992. [30] The
Oversight Committees authority is undoubtedly limited to the implementation of the Local Government Code of 1991,
not to supplant or subvert the same. Neither can it exercise control over the IRA, or even a portion thereof, of the
LGUs.

That the automatic release of the IRA was precisely intended to guarantee and promote local autonomy can be
gleaned from the discussion below between Messrs. Jose N. Nolledo and Regalado M. Maambong, then members of
the 1986 Constitutional Commission, to wit:

MR. MAAMBONG. Unfortunately, under Section 198 of the Local Government Code, the existence of subprovinces is
still acknowledged by the law, but the statement of the Gentleman on this point will have to be taken up probably by
the Committee on Legislation. A second point, Mr. Presiding Officer, is that under Article 2, Section 10 of the 1973
Constitution, we have a provision which states:

The State shall guarantee and promote the autonomy of local government units, especially the barrio, to
insure their fullest development as self-reliant communities.
 This provision no longer appears in the present configuration; does this mean that the concept of giving
local autonomy to local governments is no longer adopted as far as this Article is concerned?

MR. NOLLEDO. No. In the report of the Committee on Preamble, National Territory, and Declaration of Principles,
that concept is included and widened upon the initiative of Commissioner Bennagen.

MR. MAAMBONG. Thank you for that.

With regard to Section 6, sources of revenue, the creation of sources as provided by previous law was subject to
limitations as may be provided by law, but now, we are using the term subject to such guidelines as may be fixed by
law. In Section 7, mention is made about the unique, distinct and exclusive charges and contributions, and in Section
8, we talk about exclusivity of local taxes and the share in the national wealth. Incidentally, I was one of the authors
of this provision, and I am very thankful. Does this indicate local autonomy, or was the wording of the law changed to
give more autonomy to the local government units?[31]

MR. NOLLEDO. Yes. In effect, those words indicate also decentralization because local political units can collect
taxes, fees and charges subject merely to guidelines, as recommended by the league of governors and city mayors,
with whom I had a dialogue for almost two hours. They told me that limitations may be questionable in the sense that
Congress may limit and in effect deny the right later on.

MR. MAAMBONG. Also, this provision on automatic release of national tax share points to more local autonomy. Is
this the intention?

MR. NOLLEDO. Yes, the Commissioner is perfectly right.[32]

The concept of local autonomy was explained in Ganzon v. Court of Appeals[33] in this wise:

As the Constitution itself declares, local autonomy means a more responsive and accountable local government
structure instituted through a system of decentralization. The Constitution, as we observed, does nothing more than
to break up the monopoly of the national government over the affairs of local governments and as put by political
adherents, to liberate the local governments from the imperialism of Manila. Autonomy, however, is not meant to end
the relation of partnership and interdependence between the central administration and local government units, or
otherwise, to usher in a regime of federalism. The Charter has not taken such a radical step. Local governments,
under the Constitution, are subject to regulation, however limited, and for no other purpose than precisely, albeit
paradoxically, to enhance self-government.

As we observed in one case, decentralization means devolution of national administration but not power to the local
levels. Thus:

Now, autonomy is either decentralization of administration or decentralization of power. There is decentralization of

administration when the central government delegates administrative powers to political subdivisions 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 the [sic] favor of local
governments [sic] 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. [34]

Local autonomy includes both administrative and fiscal autonomy. The fairly recent case of  Pimentel v.
Aguirre[35] is particularly instructive. The Court declared therein that local fiscal autonomy includes the power of the
LGUs to, inter alia, allocate their resources in accordance with their own priorities:

Under existing law, local government units, in addition to having administrative autonomy in the exercise of their
functions, enjoy fiscal autonomy as well. Fiscal autonomy means that local governments have the power to create
their own sources of revenue in addition to their equitable share in the national taxes released by the national
government, as well as the power to allocate their resources in accordance with their own priorities. It extends to the
preparation of their budgets, and local officials in turn have to work within the constraints thereof. They are not
formulated at the national level and imposed on local governments, whether they are relevant to local needs and
resources or not ...[36]
 Further, a basic feature of local fiscal autonomy is the constitutionally mandated automatic release of the
shares of LGUs in the national internal revenue.[37]

Following this ratiocination, the Court in Pimentel struck down as unconstitutional Section 4 of Administrative
Order (A.O.) No. 372 which ordered the withholding, effective January 1, 1998, of ten percent of the LGUs IRA
pending the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal
situation.

In like manner, the assailed provisos in the GAAs of 1999, 2000 and 2001, and the OCD resolutions constitute
a withholding of a portion of the IRA. They put on hold the distribution and release of the five billion pesos LGSEF
and subject the same to the implementing rules and regulations, including the guidelines and mechanisms prescribed
by the Oversight Committee from time to time. Like Section 4 of A.O. 372, the assailed provisos in the GAAs of 1999,
2000 and 2001 and the OCD resolutions effectively encroach on the fiscal autonomy enjoyed by the LGUs and must
be struck down. They cannot, therefore, be upheld.

The assailed provisos in the GAAs of 1999, 2000

and 2001 and the OCD resolutions cannot amend

Section 285 of the Local Government Code of 1991

Section 284[38] of the Local Government Code provides that, beginning the third year of its effectivity, the LGUs
share in the national internal revenue taxes shall be 40%. This percentage is fixed and may not be reduced except in
the event the national government incurs an unmanageable public sector deficit" and only upon compliance with
stringent requirements set forth in the same section:

Sec. 284. ...

Provided, That in the event that the national government incurs an unmanageable public sector deficit, the President
of the Philippines is hereby authorized, upon recommendation of Secretary of Finance, Secretary of Interior and
Local Government and Secretary of Budget and Management, and subject to consultation with the presiding officers
of both Houses of Congress and the presidents of the liga, to make the necessary adjustments in the internal
revenue allotment of local government units but in no case shall the allotment be less than thirty percent (30%) of the
collection of the national internal revenue taxes of the third fiscal year preceding the current fiscal
year; Provided, further That in the first year of the effectivity of this Code, the local government units shall, in addition
to the thirty percent (30%) internal revenue allotment which shall include the cost of devolved functions for essential
public services, be entitled to receive the amount equivalent to the cost of devolved personnel services.

Thus, from the above provision, the only possible exception to the mandatory automatic release of the LGUs
IRA is if the national internal revenue collections for the current fiscal year is less than 40 percent of the collections of
the preceding third fiscal year, in which case what should be automatically released shall be a proportionate amount
of the collections for the current fiscal year. The adjustment may even be made on a quarterly basis depending on
the actual collections of national internal revenue taxes for the quarter of the current fiscal year. In the instant case,
however, there is no allegation that the national internal revenue tax collections for the fiscal years 1999, 2000 and
2001 have fallen compared to the preceding three fiscal years.

Section 285 then specifies how the IRA shall be allocated among the LGUs:

Sec. 285. Allocation to Local Government Units. The share of local government units in the internal revenue
allotment shall be allocated in the following manner:

(a) Provinces Twenty-three (23%)

(b) Cities Twenty-three percent (23%);

(c) Municipalities Thirty-four (34%); and

(d) Barangays Twenty percent (20%).

However, this percentage sharing is not followed with respect to the five billion pesos LGSEF as the assailed
OCD resolutions, implementing the assailed provisos in the GAAs of 1999, 2000 and 2001, provided for a different
sharing scheme. For example, for 1999, P2 billion of the LGSEF was allocated as follows: Provinces 40%; Cities
20%; Municipalities 40%. [39] For 2000, P3.5 billion of the LGSEF was allocated in this manner: Provinces 26%; Cities
23%; Municipalities 35%; Barangays 26%. [40] For 2001, P3 billion of the LGSEF was allocated, thus: Provinces 25%;
Cities 25%; Municipalities 35%; Barangays 15%.[41]

The respondents argue that this modification is allowed since the Constitution does not specify that the just
share of the LGUs shall only be determined by the Local Government Code of 1991.  That it is within the power of
Congress to enact other laws, including the GAAs, to increase or decrease the just share of the LGUs.  This
contention is untenable. The Local Government Code of 1991 is a substantive law. And while it is conceded that
Congress may amend any of the provisions therein, it may not do so through appropriations laws or GAAs.  Any
amendment to the Local Government Code of 1991 should be done in a separate law, not in the appropriations law,
because Congress cannot include in a general appropriation bill matters that should be more properly enacted in a
separate legislation.[42]

A general appropriations bill is a special type of legislation, whose content is limited to specified sums of money
dedicated to a specific purpose or a separate fiscal unit. [43] Any provision therein which is intended to amend another
law is considered an inappropriate provision. The category of inappropriate provisions includes unconstitutional
provisions and provisions which are intended to amend other laws, because clearly these kinds of laws have no
place in an appropriations bill.[44]

Increasing or decreasing the IRA of the LGUs or modifying their percentage sharing therein, which are fixed in
the Local Government Code of 1991, are matters of general and substantive law. To permit Congress to undertake
these amendments through the GAAs, as the respondents contend, would be to give Congress the unbridled
authority to unduly infringe the fiscal autonomy of the LGUs, and thus put the same in jeopardy every year.  This, the
Court cannot sanction.

It is relevant to point out at this juncture that, unlike those of 1999, 2000 and 2001, the GAAs of 2002 and 2003
do not contain provisos similar to the herein assailed provisos. In other words, the GAAs of 2002 and 2003 have not
earmarked any amount of the IRA for the LGSEF. Congress had perhaps seen fit to discontinue the practice as it
recognizes its infirmity.Nonetheless, as earlier mentioned, this Court has deemed it necessary to make a definitive
ruling on the matter in order to prevent its recurrence in future appropriations laws and that the principles enunciated
herein would serve to guide the bench, bar and public.

Conclusion

In closing, it is well to note that the principle of local autonomy, while concededly expounded in greater detail in
the present Constitution, dates back to the turn of the century when President William McKinley, in his Instructions to
the Second Philippine Commission dated April 7, 1900, ordered the new Government to devote their attention in the
first instance to the establishment of municipal governments in which the natives of the Islands, both in the cities and
in the rural communities, shall be afforded the opportunity to manage their own affairs to the fullest extent of which
they are capable, and subject to the least degree of supervision and control in which a careful study of their
capacities and observation of the workings of native control show to be consistent with the maintenance of law, order
and loyalty.[45] While the 1935 Constitution had no specific article on local autonomy, nonetheless, it limited the
executive power over local governments to general supervision ... as may be provided by law. [46] Subsequently, the
1973 Constitution explicitly stated that [t]he State shall guarantee and promote the autonomy of local government
units, especially the barangay to ensure their fullest development as self-reliant communities. [47] An entire article on
Local Government was incorporated therein. The present Constitution, as earlier opined, has broadened the principle
of local autonomy. The 14 sections in Article X thereof markedly increased the powers of the local governments in
order to accomplish the goal of a more meaningful local autonomy.

Indeed, the value of local governments as institutions of democracy is measured by the degree of autonomy
that they enjoy.[48] As eloquently put by M. De Tocqueville, a distinguished French political writer, [l]ocal assemblies of
citizens constitute the strength of free nations. Township meetings are to liberty what primary schools are to science;
they bring it within the peoples reach; they teach men how to use and enjoy it. A nation may establish a system of
free governments but without the spirit of municipal institutions, it cannot have the spirit of liberty. [49]

Our national officials should not only comply with the constitutional provisions on local autonomy but should
also appreciate the spirit and liberty upon which these provisions are based. [50]

WHEREFORE, the petition is GRANTED. The assailed provisos in the General Appropriations Acts of 1999,
2000 and 2001, and the assailed OCD Resolutions, are declared UNCONSTITUTIONAL.

SO ORDERED.

Vitug, (Acting Chief Justice), Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-
Martinez, Corona, Carpio-Morales, Azcuna, and Tinga, JJ., concur.

Davide, Jr., C.J., and Puno, J., on official leave.

 
 [G.R. No. 124374. December 15, 1999]

ISMAEL A. MATHAY JR., in his capacity as MAYOR OF QUEZON CITY, petitioner, vs. COURT OF APPEALS,
CIVIL SERVICE COMMISSION, EDUARDO A. TAN, LOURDES M. DE GUZMAN, MANUEL CHUA,
ANSELMO MATEO, CHRISTOPHER SANTOS, BUENAVENTURA PUNAY, ENRICO BANDILLA,
FELINO CAMACHO, DANTE E. DEOQUINO, JAIME P. URCIA, JESUS B. REGONDOLA, ROMUALDO
LIBERATO, CESAR FRANCISCO, WILLIAM PANTI, JR., MICHAEL A. JACINTO and CESAR
DACIO, respondents.

[G.R. No. 126354. December 15, 1999]

CIVIL SERVICE COMMISSION, petitioner, vs. THE HON. COURT OF APPEALS and ISMAEL A. MATHAY,
JR., respondents.

[G.R. No. 126366. December 15, 1999]

ISMAEL A. MATHAY, JR., in his capacity as MAYOR OF QUEZON CITY, petitioner, vs. COURT OF APPEALS,
CIVIL SERVICE COMMISSION and SANDY C. MARQUEZ, respondents.

DECISION

YNARES-SANTIAGO, J.:

Before this Court are three consolidated petitions[1] filed under Rule 45 of the Revised Rules of Court.

The facts behind the consolidated petitions are undisputed.

During his term as Mayor of Quezon City, Mr. Brigido R. Simon appointed private respondents [2] to positions in
the Civil Service Unit (CSU) of the local government of Quezon City. Civil Service Units were created pursuant to
Presidential Decree No. 51 which was allegedly signed into law on November 15 or 16, 1972.

On February 23, 1990, the Secretary of Justice rendered Opinion No. 33, stating that Presidential Decree No.
51 was never published in the Official Gazette. Therefore, conformably with our ruling in Tanada vs. Tuvera[3] the
presidential decree is deemed never in force or effect and therefore cannot at present, be a basis for establishment
of the CSUs . . . .[4]

On June 4, 1990, the Civil Service Commission issued Memorandum Circular No. 30, directing all Civil Service
Regional or Field Offices to recall, revoke and disapprove within one year from issuance of the said Memorandum, all
appointments in CSUs created pursuant to Presidential Decree No. 51 on the ground that the same never became
law. Among those affected by the revocation of appointments are private respondents in these three petitions.

For Quezon City CSU employees, the effects of the circular were temporarily cushioned by the enactment of
City Ordinance No. NC-140, Series of 1990, which established the Department of Public Order and Safety (DPOS).

At the heart of these petitions is Section 3 of the Ordinance which provides:

Sec. 3. The present personnel of the Civil Security Unit, Traffic Management Unit, Anti-Squatting and Surveillance
and Enforcement Team, and Disaster Coordinating Council are hereby absorbed into the department of public order
and safety established under Section one hereof to be given appropriate position titles without reduction in salary,
seniority rights and other benefits. Funds provided for in the 1990 Budget for the absorbed offices shall be used as
the initial budgetary allocation of the Department. (Underscoring ours).

Despite the provision on absorption, the regular and permanent positions in the DPOS were not filled due to
lack of funds for the new DPOS and the insufficiency of regular and permanent positions created.

Mayor Brigido R. Simon remedied the situation by offering private respondents contractual appointments for
the period of June 5, 1991 to December 31, 1991. The appointments were renewed by Mayor Simon for the period of
January 1, 1992 to June 30, 1992.

On May 11, 1992, petitioner Ismael A. Mathay, Jr. was elected Mayor of Quezon City. On July 1, 1992, Mayor
Mathay again renewed the contractual appointments of all private respondents effective July 1 to July 31, 1992. Upon
their expiry, these appointments, however, were no longer renewed.

The non-renewal by Quezon City Mayor Ismael A. Mathay, Jr. of private respondents appointments became
the seed of discontent from which these three consolidated petitions grew.

We discuss the merits of the petitions of Mayor Ismael A. Mathay, Jr. jointly.

G.R. No. 124374 and G.R. No. 126366

After the non-renewal of their appointments, private respondents in these two petitions appealed to the Civil
Service Commission. The CSC issued separate resolutions holding that the reappointment of private respondents to
the DPOS was automatic, pursuant to the provision on absorption in Quezon City Ordinance No. NC-140, Series of
1990,[5] and ordering their reinstatement to their former positions in the DPOS. [6] Petitioner brought petitions
for certiorari to this Court,[7] to annul the resolutions but, in accordance with Revised Administrative Circular No. 1-95,
the petition were referred to the Court of Appeals. As stated, the Court of Appeals dismissed the petitions
for certiorari.

In the instant petition for review, petitioner asserts that the Court of Appeals erred when it ruled that respondent
Civil Service Commission has the authority to direct him to reinstate private respondents in the DPOS.

We agree with petitioner.

The law applicable is B.P. 337 or the old Local Government Code and not the Local Government Code of 1992
which became effective only on January 1, 1992, when the material events in this case transpired.

Applying the said law, we find that the Civil Service Commission erred when it applied the directives of
Ordinance NC-140 and in so doing ordered petitioner to reinstate private respondents to positions in the
DPOS. Section 3 of the said Ordinance is invalid for being inconsistent with B.P. 337. We note that Section 3 of the
questioned Ordinance directs the absorption of the personnel of the defunct CSU into the new DPOS. The Ordinance
refers to personnel and not to positions. Hence, the city council or sanggunian, through the Ordinance, is in effect
dictating who shall occupy the newly created DPOS positions. However, a review of the provisions of B.P. 337 shows
that the power to appoint rests exclusively with the local chief executive and thus cannot be usurped by the city
council or sanggunianthrough the simple expedient of enacting ordinances that provide for the absorption of specific
persons to certain positions.

In upholding the provisions of the Ordinance on the automatic absorption of the personnel of the CSU into the
DPOS without allowance for the exercise of discretion on the part of the City Mayor, the Court of Appeals makes the
sweeping statement that the doctrine of separation of powers is not applicable to local governments. [8] We are unable
to agree. The powers of the city council and the city mayor are expressly enumerated separately and delineated by
B.P. 337.

The provisions of B.P. 337 are clear. As stated above, the power to appoint is vested in the local chief
executive.[9] The power of the city council or sanggunian, on the other hand, is limited
to creating,consolidating and reorganizing city officers and positions supported by local funds. The city council has no
power to appoint. This is clear from Section 177 of B.P. 337 which lists the powers of the sanggunian. The power to
appoint is not one of them. Expressio unius est exclusio alterius.[10] Had Congress intended to grant the power to
appoint to both the city council and the local chief executive, it would have said so in no uncertain terms.

By ordering petitioner to reinstate private respondents pursuant to Section 3 of the Ordinance, the Civil Service
Commission substituted its own judgment for that of the appointing power. This cannot be done. In a long line of
cases,[11] we have consistently ruled that the Civil Service Commissions power is limited to approving or disapproving
an appointment. It does not have the authority to direct that an appointment of a specific individual be made.  Once
the Civil Service Commission attests whether the person chosen to fill a vacant position is eligible, its role in the
appointment process necessarily ends. The Civil Service Commission cannot encroach upon the discretion vested in
the appointing authority.

The Civil Service Commission argues that it is not substituting its judgment for that of the appointing power and
that it is merely implementing Section 3 of Ordinance NC-140.

The Ordinance refers to the personnel of the CSU, the identities of which could not be mistaken. The
resolutions of the Civil Service Commission likewise call for the reinstatement of named individuals.There being no
issue as to who are to sit in the newly created DPOS, there is therefore no room left for the exercise of
discretion. In Farinas vs. Barba,[12] we held that the appointing authority is not bound to appoint anyone
recommended by the sanggunian concerned, since the power of appointment is a discretionary power.

When the Civil Service Commission ordered the reinstatement of private respondents, it technically issued a
new appointment.[13] This task, i.e. of appointment, is essentially discretionary and cannot be controlled even by the
courts as long as it is properly and not arbitrarily exercised by the appointing authority.

In Apurillo vs. Civil Service Commission, we held that appointment is essentially a discretionary power and
must be performed by the officer in which it is vested.[14]

The above premises considered, we rule that the Civil Service Commission has no power to order petitioner
Ismael A. Mathay, Jr. to reinstate private respondents.

Petitioner similarly assails as error the Court of Appeals ruling that private respondents should be automatically
absorbed in the DPOS pursuant to Section 3 of the Ordinance.

In its decision of March 21, 1996 the Court of Appeals held:

It is clear however, that Ordinance No. NC-140, absorbing the present personnel of the Civil Security Agent Unit in
the DPOS was earlier enacted, particularly on March 27, 1990, thus, private respondents were still holders of de jure
appointments as permanent regular employees at the time, and therefore, by operation of said Ordinance private
respondents were automatically absorbed in the DPOS effectively as of March 27, 1990.[15] (Underscoring ours.)

The decision is based on the wrong premise.

 Even assuming the validity of Section 3 of the Ordinance, the absorption contemplated therein is not
possible. Since the CSU never legally came into existence, the private respondents never held permanent
positions. Accordingly, as petitioner correctly points out, [16] the private respondents appointments in the defunct CSU -
--

were invalid ab initio. Their seniority rights and permanent status did not arise since they have no valid
appointment. For them to enter the Civil Service after the revocation and cancellation of their invalid
appointment, they have to be extended an original appointment, subject again to the attesting power of the Civil
Service Commission.

Being then not members of the Civil Service as of June 4, 1991, they cannot be automatically
absorbed/reappointed/appointed/reinstated into the newly created DPOS. (Underscoring ours)

It is axiomatic that the right to hold public office is not a natural right.  The right exists only by virtue of a law
expressly or impliedly creating and conferring it.[17] Since Presidential Decree 51 creating the CSU never became law,
it could not be a source of rights. Neither could it impose duties. It could not afford any protection. It did not create an
office. It is as inoperative as though it was never passed.

In Debulgado vs. Civil Service Commission [18] we held that a void appointment cannot give rise to security of
tenure on the part of the holder of the appointment.

While the Court of Appeals was correct when it stated that the abolition of an office does not mean the invalidity
of appointments thereto,[19] this cannot apply to the case at bar. In this case, the CSU was not abolished. It simply did
not come into existence as the Presidential Decree creating it never became law.

At the most, private respondents held temporary and contractual appointments. The non-renewal of these

appointments cannot therefore be taken against petitioner. In Romualdez III vs. Civil Service Commission[20] we
treated temporary appointments as follows:

The acceptance by the petitioner of a temporary appointment resulted in the termination of official relationship with
his former permanent position. When the temporary appointment was not renewed, the petitioner had no cause to
demand reinstatement thereto. (Underscoring ours.)

Another argument against the concept of automatic absorption is the physical and legal impossibility given the
number of available positions in the DPOS and the number of personnel to be absorbed. [21]We note that Section 1 of
Ordinance NC-140 provides:

There is hereby established in the Quezon City Government the Department of Public Order and Safety whose
organization, structure, duties, functions and responsibilities are as provided or defined in the attached supporting
documents consisting of eighteen (18) pages which are made integral parts of this Ordinance.

A review of the supporting documents shows that Ordinance No. NC-140 allowed only two slots for the position
of Security Officer II with a monthly salary of P4,418.00 and four slots for the position of Security Agent with a
monthly salary of P3,102.00. The limited number of slots provided in the Ordinance renders automatic absorption
unattainable, considering that in the defunct CSU there are twenty Security Officers with a monthly salary
of P4,418.00 and six Security Agents with a monthly salary of P3,102.00. Clearly, the positions created in the DPOS
are not sufficient to accommodate the personnel of the defunct CSU, making automatic absorption impossible.

Considering that private respondents did not legally hold valid positions in the CSU, for lack of a law creating it,
or the DPOS, for lack of a permanent appointment to the said agency, it becomes unnecessary to discuss whether
their acceptance of the contractual appointments constitutes an abandonment or waiver of such positions. It escapes
us how one can relinquish or renounce a right one never possessed. A person waiving must actually have the right
which he is renouncing.

G.R. 126354

In this case, petitioner, Civil Service Commission seeks the reversal of the decision of the Court of Appeals of
July 5, 1996, which overturned CSC Resolution Nos. 955040 and 932732 and held that the Civil Service Commission
has no authority to compel the mayor of Quezon City to reinstate Jovito C. Labajo to the DPOS.

The standing of petitioner Civil Service Commission to bring this present appeal is questionable.

We note that the person adversely affected by the Court of Appeals decision, Jovito C. Labajo has opted  not to
appeal.
 Basic is the rule that every action must be prosecuted or defended in the name of the real party in interest. [22] A
real party in interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled
to the avails of the suit.

In Ralla vs. Ralla we defined interest as material interest, an interest in issue and to be affected by the decree,
as distinguished from mere interest in the question involved, or mere incidental interest. [23]As a general rule, one
having no right or interest to protect cannot invoke the jurisdiction of the court as a party-plaintiff in an action.

In the case at bar, it is evident that Jovito C. Labajo, not the Civil Service Commission, is the real party in
interest. It is Jovito C. Labajo who will be benefited or injured by his reinstatement or non-reinstatement.

We are aware of our pronouncements in the recent case of Civil Service Commission v. Pedro
Dacoycoy[24] which overturned our rulings in Paredes vs. Civil Service Commission, [25] Mendez vs. Civil Service
Commission[26] and Magpale vs. Civil Service Commission. [27] In Dacoycoy, we affirmed the right of the Civil Service
Commission to bring an appeal as the aggrieved party affected by a ruling which may seriously prejudice the civil
service system.

The aforementioned case, however, is different from the case at bar. Dacoycoy was an administrative case
involving nepotism whose deleterious effect on government cannot be overemphasized. The subject of the present
case, on the other hand, is reinstatement.

We fail to see how the present petition, involving as it does the reinstatement or non-reinstatement of one
obviously reluctant to litigate, can impair the effectiveness of government. Accordingly, the ruling in Dacoycoy does
not apply.

To be sure, when the resolutions of the Civil Service Commission were brought before the Court of Appeals,
the Civil Service Commission was included only as a nominal party. As a quasi-judicial body, the Civil Service
Commission can be likened to a judge who should detach himself from cases where his decision is appealed to a
higher court for review.[28]

In instituting G.R. No. 126354, the Civil Service Commission dangerously departed from its role as adjudicator
and became an advocate. Its mandated function is to hear and decide administrative cases instituted by or brought
before it directly or on appeal, including contested appointments and to review decisions and actions of its offices and
agencies,[29] not to litigate.

Therefore, we rule that the Civil Service Commission has no legal standing to prosecute G.R. No. 126354.

WHEREFORE, the petitions of Ismael A. Mathay in G.R. No.124374 and G.R. No. 126366 are GRANTED and
the decisions of the Court of Appeals dated March 21, 1996 and January 15, 1996 are REVERSED and SET ASIDE.

The petition of the Civil Service Commission in G.R. No. 126354 is DISMISSED for lack of legal standing to
sue. The assailed decision of the respondent Court of Appeals dated July 5, 1996 is AFFIRMED.

No costs.

SO ORDERED.

Davide, Jr., C.J., Bellosillo, Puno, Kapunan, Mendoza, Panganiban, Quisumbing, Purisima, Pardo, Buena,
Gonzaga-Reyes, and De Leon, Jr., JJ., concur.

Melo, and Vitug, JJ., in the result.

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 79956               January 29, 1990

CORDILLERA BROAD COALITION, petitioner, 

vs.
COMMISSION ON AUDIT, respondent.

G.R. No. 82217               January 29, 1990

LILIA YARANON and BONA BAUTISTA, assisted by their spouses, BRAULIO D. YARANON and DEMETRIO D.
BAUTISTA, JR., respectively; JAMES BRETT and SINAI C. HAMADA, petitioners, 
vs.
THE COMMISSION ON AUDIT, HON. CATALINO MACARAIG, Executive Secretary, HON. VICENTE JAYME,
Secretary of Finance, HON. GUILLERMO N. CARAGUE, Secretary of Budget and Management, and HON.
ROSALINA S. CAJUCOM, OIC National Treasurer, respondents.

CORTES, J.:

In these consolidated petitions, the constitutionality of Executive Order No. 220, dated July 15, 1987, which created
the (Cordillera Administrative Region, is assailed on the primary ground that it pre-empts the enactment of an organic
act by the Congress and the creation of' the autonomous region in the Cordilleras conditional on the approval of the
act through a plebiscite.

Relative to the creation of autonomous regions, the constitution, in Article X, provides:

AUTONOMOUS REGIONS

Sec. 15. There shall be created autonomous regions in Muslim Mindanao and in the Cordilleras consisting of
provinces, cities, municipalities, and geographical areas sharing common and distinctive historical and cultural
heritage, economic and social structures, and other relevant characteristics within the framework of this Constitution
and the national sovereignty as well as territorial integrity of the Republic of the Philippines.

SEC. 16. The President shall exercise general supervision over autonomous regions to ensure that laws are faithfully
executed.

Sec. 17. All powers, functions, and responsibilities not granted Constitution or by law to the autonomous regions shall
be vested in the National Government.

Sec. 18. The Congress shall enact an organic act for each autonomous region with the assistance and participation
of the regional consultative commission composed of representatives appointed by the President from a list of
nominees from multi-sectoral bodies. The organic act shall define the basic structure of government for the region
consisting of the executive department and legislative assembly, both of which shall be elective and representative of
the constituent political units. The organic acts shall likewise provide for special courts with personal, family and
property law jurisdiction consistent with the provisions of this Constitution and national laws.

The creation of the autonomous region shall be effective when approved by majority of the votes cast by the
constituent units in a plebiscite called for the purpose, provided that only provinces, cities, and geographic areas
voting favorably in such plebiscite shall be included in the autonomous region.

Sec. 19. The first Congress elected under this Constitution shall, within eighteen months from the time of
organization of both Houses, pass the organic acts for the autonomous regions in Muslim Mindanao and the
Cordilleras.

Sec. 20. Within its territorial jurisdiction and subject to the provisions of this Constitution and national laws, the
organic act of autonomous regions shall provide for legislative powers over:

(1) Administrative organization;

(2) Creation of sources of revenues;

(3) Ancestral domain and natural resources;

(4) Personal, family and property relations;

(5) Regional urban and rural planning development;

(6) Economic, social and tourism development ;

(7) Educational policies;

(8) Preservation and development of the cultural heritage; and

(9) Such other matters as may be authorized by law for the promotion of the general welfare of the people of the
region.

Sec. 21. The preservation of peace and order within the regions shall be the responsibility of the local police
agencies which shall be organized, maintained, supervised, and utilized in accordance with applicable laws. The
defense and security of the regions shall be the responsibility of the National Government.

A study of E.O. No. 220 would be incomplete Without reference to its historical background.

In April 1986, just after the EDSA Revolution, Fr. Conrado M. Balweg, S.V.D., broke off on ideological grounds from
the Communist Party of the Philippines (CPP) and its military arm the New People's Army. (NPA).

After President Aquino was installed into office by People Power, she advocated a policy of national reconciliation.
She called on all revolutionary forces to a peace dialogue. The CPLA heeded this call of the President. After the
preliminary negotiations, President Aquino and some members of her Cabinet flew to Mt. Data in the Mountain
Province on September 13, 1986 and signed with Fr. Conrado M. Balweg (As Commander of the CPLA and Ama
Mario Yag-ao (as President of Cordillera Bodong Administration, the civil government of the CPLA a ceasefire
agreement that signified the cessation of hostilities (WHEREAS No. 7, E.O. 220).

The parties arrived at an agreement in principle: the Cordillera people shall not undertake their demands through
armed and violent struggle but by peaceful means, such as political negotiations. The negotiations shall be a
continuing process until the demands of the Cordillera people shall have been substantially granted.

On March 27, 1987, Ambassador Pelaez [Acting as Chief Negotiator of the government], in pursuance of the
September 13, 1986 agreement, flew to the Mansion House, Baguio City, and signed with Fr. Balweg (as Chairman
of the Cordillera panel) a joint agreement, paragraphs 2 and 3 of which state:

Par. 2- Work together in drafting an Executive Order to create a preparatory body that could perform policy-making
and administrative functions and undertake consultations and studies leading to a draft organic act for the
Cordilleras.

Par. 3- Have representatives from the Cordillera panel join the study group of the R.P. Panel in drafting the Executive
Order.

Pursuant to the above joint agreement, E.O. 220 was drafted by a panel of the Philippine government and of the
representatives of the Cordillera people.

On July 15, 1987, President Corazon C. Aquino signed the joint draft into law, known now as E.O. 220. [Rejoinder
G.R. No. 82217, pp. 2-3].

Executive Order No. 220, issued by the President in the exercise of her legislative powers under Art. XVIII, sec. 6 of
the 1987 Constitution, created the Cordillera Administrative Region (CAR) , which covers the provinces of Abra,
Benguet, Ifugao, Kalinga-Apayao and Mountain Province and the City of Baguio [secs. 1 and 2]. It was created to
accelerate economic and social growth in the region and to prepare for the establishment of the autonomous region
in the Cordilleras [sec. 3]. Its main function is to coordinate the planning and implementation of programs and
services in the region, particularly, to coordinate with the local government units as well as with the executive
departments of the National Government in the supervision of field offices and in identifying, planning, monitoring,
and accepting projects and activities in the region [sec. 5]. It shall also monitor the implementation of all ongoing
national and local government projects in the region [sec. 20]. The CAR shall have a Cordillera Regional Assembly
as a policy-formulating body and a Cordillera Executive Board as an implementing arm [secs. 7, 8 and 10]. The CAR
and the Assembly and Executive Board shall exist until such time as the autonomous regional government is
established and organized [sec. 17].

Explaining the rationale for the issuance of E.O. No. 220, its last "Whereas" clause provides:

WHEREAS, pending the convening of the first Congress and the enactment of the organic act for a Cordillera
autonomous region, there is an urgent need, in the interest of national security and public order, for the President to
reorganize immediately the existing administrative structure in the Cordilleras to suit it to the existing political realities
therein and the Government's legitimate concerns in the areas, without attempting to pre-empt the constitutional duty
of the first Congress to undertake the creation of an autonomous region on a permanent basis.
During the pendency of this case, Republic Act No. 6766 entitled "An Act Providing for an Organic Act for the
Cordillera Autonomous Region," was enacted and signed into law. The Act recognizes the CAR and the offices and
agencies created under E.O. No. 220 and its transitory nature is reinforced in Art. XXI of R.A. No. 6766, to wit:

SEC. 3. The Cordillera Executive Board, the Cordillera Region Assembly as well as all offices and agencies created
under Execute Order No. 220 shall cease to exist immediately upon the ratification of this Organic Act.

All funds, properties and assets of the Cordillera Executive Board and the Cordillera Regional Assembly shall
automatically be transferred to the Cordillera Autonomous Government.

It is well-settled in our jurisprudence that respect for the inherent and stated powers and prerogatives of the law-
making body, as well as faithful adherence to the principle of separation of powers, require that its enactment be
accorded the presumption of constitutionality. Thus, in any challenge to the constitutionality of a statute, the burden
of clearly and unequivocally proving its unconstitutionality always rests upon the challenger. Conversely, failure to so
prove will necessarily defeat the challenge.

We shall be guided by these principles in considering these consolidated petitions.

In these cases, petitioners principally argue that by issuing E.O. No. 220 the President, in the exercise of her
legislative powers prior to the convening of the first Congress under the 1987 Constitution, has virtually pre-empted
Congress from its mandated task of enacting an organic act and created an autonomous region in the Cordilleras.
We have carefully studied the Constitution and E.O. No. 220 and we have come to the conclusion that petitioners'
assertions are unfounded. Events subsequent to the issuance of E.O. No. 220 also bear out this conclusion.

1. A reading of E.O. No. 220 will easily reveal that what it actually envisions is the consolidation and coordination of
the delivery of services of line departments and agencies of the National Government in the areas covered by the
administrative region as a step preparatory to the grant of autonomy to the Cordilleras. It does not create the
autonomous region contemplated in the Constitution. It merely provides for transitory measures in anticipation of the
enactment of an organic act and the creation of an autonomous region. In short, it prepares the ground for autonomy.
This does not necessarily conflict with the provisions of the Constitution on autonomous regions, as we shall show
later.

The Constitution outlines a complex procedure for the creation of an autonomous region in the Cordilleras. A regional
consultative commission shall first be created. The President shall then appoint the members of a regional
consultative commission from a list of nominees from multi-sectoral bodies. The commission shall assist the
Congress in preparing the organic act for the autonomous region. The organic act shall be passed by the first
Congress under the 1987 Constitution within eighteen months from the time of its organization and enacted into law.
Thereafter there shall be held a plebiscite for the approval of the organic act [Art. X, sec. 18]. Only then, after its
approval in the plebiscite, shall the autonomous region be created.

Undoubtedly, all of these will take time. The President, in 1987 still exercising legislative powers, as the first
Congress had not yet convened, saw it fit to provide for some measures to address the urgent needs of the
Cordilleras in the meantime that the organic act had not yet been passed and the autonomous region created. These
measures we find in E.O. No. 220. The steps taken by the President are obviously perceived by petitioners,
particularly petitioner Yaranon who views E.O. No. 220 as capitulation to the Cordillera People's Liberation Army
(CPLA) of Balweg, as unsound, but the Court cannot inquire into the wisdom of the measures taken by the President,
We can only inquire into whether or not the measures violate the Constitution. But as we have seen earlier, they do
not.

2. Moreover, the transitory nature of the CAR does not necessarily mean that it is, as petitioner Cordillera Broad
Coalition asserts, "the interim autonomous region in the Cordilleras" [Petition, G.R. No. 79956, p. 25].

The Constitution provides for a basic structure of government in the autonomous region composed of an elective
executive and legislature and special courts with personal, family and property law jurisdiction [Art. X, sec. 18]. Using
this as a guide, we find that E.O. No. 220 did not establish an autonomous regional government. It created a region,
covering a specified area, for administrative purposes with the main objective of coordinating the planning and
implementation of programs and services [secs. 2 and 5]. To determine policy, it created a representative assembly,
to convene yearly only for a five-day regular session, tasked with, among others, identifying priority projects and
development programs [sec. 9]. To serve as an implementing body, it created the Cordillera Executive Board
composed of the Mayor of Baguio City, provincial governors and representatives of the Cordillera Bodong
Administration, ethno-linguistic groups and non-governmental organizations as regular members and all regional
directors of the line departments of the National Government as ex-officio members and headed by an Executive
Director [secs. 10 and 11]. The bodies created by E.O. No. 220 do not supplant the existing local governmental
structure, nor are they autonomous government agencies. They merely constitute the mechanism for an "umbrella"
that brings together the existing local governments, the agencies of the National Government, the ethno-linguistic
groups or tribes, and non-governmental organizations in a concerted effort to spur development in the Cordilleras.

The creation of the CAR for purposes of administrative coordination is underscored by the mandate of E.O. No. 220
for the President and appropriate national departments and agencies to make available sources of funds for priority
development programs and projects recommended by the CAR [sec. 21] and the power given to the President to call
upon the appropriate executive departments and agencies of the National Government to assist the CAR [sec. 24].

3. Subsequent to the issuance of E.O. No. 220, the Congress, after it was convened, enacted Republic Act No. 6658
which created the Cordillera Regional Consultative Commission. The President then appointed its members. The
commission prepared a draft organic act which became the basis for the deliberations of the Senate and the House
of Representatives. The result was Republic Act No. 6766, the organic act for the Cordillera autonomous region,
which was signed into law on October 23, 1989. A plebiscite for the approval of the organic act, to be conducted
shortly, shall complete the process outlined in the Constitution.

In the meantime, E.O. No. 220 had been in force and effect for more than two years and we find that, despite E.O.
No. 220, the autonomous region in the Cordilleras is still to be created, showing the lack of basis of petitioners'
assertion. Events have shown that petitioners' fear that E.O. No. 220 was a "shortcut" for the creation of the
autonomous region in the Cordilleras was totally unfounded.

Clearly, petitioners' principal challenge has failed.

II

A collateral issue raised by petitioners is the nature of the CAR: whether or not it is a territorial and political
subdivision. The Constitution provides in Article X:

Section 1. The territorial and political subdivisions of the Republic of the Philippines are the provinces, cities,
municipalities, and barangays. There shall be autonomous regions in Muslim Mindanao and the Cordilleras as
hereinafter provided.

x x x           x x x          x x x

Sec. 10. No province, city, municipality, or barangay may be created, divided, merged, abolished, or its boundary
substantially altered, except in accordance with the criteria established in the local government code and subject to
approval by a majority of the votes cast in a plebiscite in the political units directly affected.

We have seen earlier that the CAR is not the autonomous region in the Cordilleras contemplated by the Constitution,
Thus, we now address petitioners' assertion that E. 0. No. 220 contravenes the Constitution by creating a new
territorial and political subdivision.

After carefully considering the provisions of E.O. No. 220, we find that it did not create a new territorial and political
subdivision or merge existing ones into a larger subdivision.

1. Firstly, the CAR is not a public corporation or a territorial and political subdivision. It does not have a separate
juridical personality, unlike provinces, cities and municipalities. Neither is it vested with the powers that are normally
granted to public corporations, e.g. the power to sue and be sued, the power to own and dispose of property, the
power to create its own sources of revenue, etc. As stated earlier, the CAR was created primarily to coordinate the
planning and implementation of programs and services in the covered areas.

The creation of administrative regions for the purpose of expediting the delivery of services is nothing
new.1âwphi1 The Integrated Reorganization Plan of 1972, which was made as part of the law of the land by virtue of
Presidential Decree No. 1, established eleven (11) regions, later increased to twelve (12), with definite regional
centers and required departments and agencies of the Executive Branch of the National Government to set up field
offices therein. The functions of the regional offices to be established pursuant to the Reorganization Plan are: (1) to
implement laws, policies, plans, programs, rules and regulations of the department or agency in the regional areas;
(2) to provide economical, efficient and effective service to the people in the area; (3) to coordinate with regional
offices of other departments, bureaus and agencies in the area; (4) to coordinate with local government units in the
area; and (5) to perform such other functions as may be provided by law. [See Part II, chap. III, art. 1, of the
Reorganization Plan].

We can readily see that the CAR is in the same genre as the administrative regions created under the
Reorganization Plan, albeit under E.O. No. 220 the operation of the CAR requires the participation not only of the line
departments and agencies of the National Government but also the local governments, ethno-linguistic groups and
non-governmental organizations in bringing about the desired objectives and the appropriation of funds solely for that
purpose.

2. Then, considering the control and supervision exercised by the President over the CAR and the offices created
under E.O. No. 220, and considering further the indispensable participation of the line departments of the National
Government, the CAR may be considered more than anything else as a regional coordinating agency of the National
Government, similar to the regional development councils which the President may create under the Constitution [Art.
X, sec. 14]. These councils are "composed of local government officials, regional heads of departments and other
government offices, and representatives from non-governmental organizations within the region for purposes of
administrative decentralization to strengthen the autonomy of the units therein and to accelerate the economic and
social growth and development of the units in the region." [Ibid.] In this wise, the CAR may be considered as a more
sophisticated version of the regional development council.

III

Finally, petitioners incidentally argue that the creation of the CAR contravened the constitutional guarantee of the
local autonomy for the provinces (Abra, Benguet, Ifugao, Kalinga-Apayao and Mountain Province) and city (Baguio
City) which compose the CAR.

We find first a need to clear up petitioners' apparent misconception of the concept of local autonomy.

It must be clarified that the constitutional guarantee of local autonomy in the Constitution [Art. X, sec. 2] refers to
the administrative autonomy of local government units or, cast in more technical language, the decentralization of
government authority [Villegas v. Subido, G.R. No. L-31004, January 8, 1971, 37 SCRA 1]. Local autonomy is not
unique to the 1987 Constitution, it being guaranteed also under the 1973 Constitution [Art. II, sec. 10]. And while
there was no express guarantee under the 1935 Constitution, the Congress enacted the Local Autonomy Act (R.A.
No. 2264) and the Decentralization Act (R.A. No. 5185), which ushered the irreversible march towards further
enlargement of local autonomy in the country [Villegas v. Subido, supra.]

On the other hand, the creation of autonomous regions in Muslim Mindanao and the Cordilleras, which is peculiar to
the 1987 Constitution contemplates the grant of political autonomy and not just administrative autonomy these
regions. Thus, the provision in the Constitution for an autonomous regional government with a basic structure
consisting of an executive department and a legislative assembly and special courts with personal, family and
property law jurisdiction in each of the autonomous regions [Art. X, sec. 18].

As we have said earlier, the CAR is a mere transitory coordinating agency that would prepare the stage for political
autonomy for the Cordilleras. It fills in the resulting gap in the process of transforming a group of adjacent territorial
and political subdivisions already enjoying local or administrative autonomy into an autonomous region vested with
political autonomy.

Anent petitioners' objection, we note the obvious failure to show how the creation of the CAR has actually diminished
the local autonomy of the covered provinces and city. It cannot be over-emphasized that pure speculation and a
resort to probabilities are insufficient to cause the invalidation of E.O. No. 220.

WHEREFORE, the petitions are DISMISSED for lack of merit.

SO ORDERED.

Ordillo vs Comelec (192 SCRA 100)

Posted on June 30, 2013 by winnieclaire

Standard

Facts: On January 30, 1990, the people of the provinces of Benguet, Mountain Province, Ifugao, Abra and
Kalinga-Apayao and the city of Baguio cast their votes in a plebiscite held pursuant to Republic Act No. 6766
entitled “An Act Providing for an Organic Act for the Cordillera Autonomous Region.”
 The official Commission on Elections (COMELEC) results of the plebiscite showed that the creation of the
Region was approved by a majority of 5,889 votes in only the Ifugao Province and was overwhelmingly rejected
by 148,676 votes in the rest of the provinces and city above-mentioned.
Consequently, the COMELEC, on February 14, 1990, issued Resolution No. 2259 stating that the Organic Act for
the Region has been approved and/or ratified by majority of the votes cast only in the province of Ifugao.
the petitioner filed a petition with COMELEC to declare the non-ratification of the Organic Act for the Region. The
petitioners maintain that there can be no valid Cordillera Autonomous Region in only one province as the
Constitution and Republic Act No. 6766 require that the said Region be composed of more than one constituent
unit.

Issue: The question raised in this petition is whether or not the province of Ifugao, being the only province which
voted favorably for the creation of the Cordillera Autonomous Region can, alone, legally and validly constitute
such Region.

Held: The sole province of Ifugao cannot validly constitute the Cordillera Autonomous Region.
It is explicit in Article X, Section 15 of the 1987 Constitution. The keywords — provinces, cities, municipalities
and geographical areas connote that “region” is to be made up of more than one constituent unit. The
term “region” used in its ordinary sense means two or more provinces. This is supported by the fact that
the thirteen (13) regions into which the Philippines is divided for administrative purposes are groupings
of contiguous provinces. Ifugao is a province by itself. To become part of a region, it must join other
provinces, cities, municipalities, and geographical areas. It joins other units because of their common and
distinctive historical and cultural heritage, economic and social structures and other relevant characteristics. The
Constitutional requirements are not present in this case.

Article III, Sections 1 and 2 of Republic Act No. 6766 provide that the Cordillera Autonomous Region is to be
administered by the Cordillera government consisting of the Regional Government and local government units. It
further provides that:
“SECTION 2. The Regional Government shall exercise powers and functions necessary for the proper
governance and development of all provinces, cities, municipalities, and barangay or ili within the Autonomous
Region . . .”
From these sections, it can be gleaned that Congress never intended that a single province may constitute
the autonomous region. Otherwise, we would be faced with the absurd situation of having two sets of
officials, a set of provincial officials and another set of regional officials exercising their executive and
legislative powers over exactly the same small area.

Abbas vs Comelec (179 SCRA 287)

Posted on June 30, 2013 by winnieclaire

Standard
Facts: The arguments against R.A. 6734 raised by petitioners may generally be categorized into either of the
following:
(a) that R.A. 6734, or parts thereof, violates the Constitution, and
(b) that certain provisions of R.A. No. 6734 conflict with the Tripoli Agreement.
Petitioner Abbas argues that R.A. No. 6734 unconditionally creates an autonomous region in Mindanao, contrary
to the aforequoted provisions of the Constitution on the autonomous region which make the creation of such
region dependent upon the outcome of the plebiscite.
In support of his argument, petitioner cites Article II, section 1(1) of R.A. No. 6734 which declares that “[t]here is
hereby created the Autonomous Region in Muslim Mindanao, to be composed of provinces and cities voting
favorably in the plebiscite called for the purpose, in accordance with Section 18, Article X of the Constitution.”
Petitioner contends that the tenor of the above provision makes the creation of an autonomous region absolute,
such that even if only two provinces vote in favor of autonomy, an autonomous region would still be created
composed of the two provinces where the favorable votes were obtained.

The matter of the creation of the autonomous region and its composition needs to be clarified.

Held: Thus, under the Constitution and R.A. No 6734, the creation of the autonomous region shall take effect
only when approved by a majority of the votes cast by the constituent units in a plebiscite, and only those
provinces and cities where a majority vote in favor of the Organic Act shall be included in the autonomous region.
The provinces and cities wherein such a majority is not attained shall not be included in the autonomous region.
It may be that even if an autonomous region is created, not all of the thirteen (13) provinces and nine (9) cities
mentioned in Article II, section 1 (2) of R.A. No. 6734 shall be included therein. The single plebiscite
contemplated by the Constitution and R.A. No. 6734 will therefore be determinative of (1) whether there shall be
an autonomous region in Muslim Mindanao and (2) which provinces and cities, among those enumerated in R.A.
No. 6734, shall compromise it.

It will readily be seen that the creation of the autonomous region is made to depend, not on the total
majority vote in the plebiscite, but on the will of the majority in each of the constituent units and the
proviso underscores this. for if the intention of the framers of the Constitution was to get the majority of
the totality of the votes cast, they could have simply adopted the same phraseology as that used for the
ratification of the Constitution, i.e. “the creation of the autonomous region shall be effective when
approved by a majority of the votes cast in a plebiscite called for the purpose.”
It is thus clear that what is required by the Constitution is a simple majority of votes approving the
organic Act in individual constituent units and not a double majority of the votes in all constituent units
put together, as well as in the individual constituent units.
More importantly, because of its categorical language, this is also the sense in which the vote requirement in the
plebiscite provided under Article X, section 18 must have been understood by the people when they ratified the
Constitution.

epublic of the Philippines

SUPREME COURT
Manila

EN BANC
G.R. No. 91023 July 13, 1990

METROPOLITAN TRAFFIC COMMAND WEST TRAFFIC DISTRICT, petitioner, 

vs.
HON. ARSENIO M. GONONG, in his capacity as Presiding Judge of the Regional Trial Court, Branch 8 at
Manila, and DANTE S. DAVID, respondents.

Dante S. David for and in his own behalf as private respondent.

CRUZ, J.:

We deal here with a practice known to many motorists in Metro Manila: the removal of the license plates of illegally
parked vehicles. This was challenged by the private respondent in the regional trial court of Manila, which held the
practice unlawful. The petitioner is now before us, urging reversal of the decision for grave abuse of discretion.

The original complaint was filed with the said court on August 10, 1989, by Dante S. David, a lawyer, who claimed
that the rear license plate, of his car was removed by the Metropolitan Traffic Command while the vehicle was parked
on Escolta. He questioned the petitioner's act on the ground not only that the car was not illegally parked but, more
importantly, that there was no ordinance or law authorizing such removal. He asked that the practice be permanently
enjoined and that in the meantime a temporary restraining order or a writ of preliminary injunction be issued.

Judge Arsenio M. Gonong issued a temporary restraining order on August 14, 1989, and hearings on the writ of
preliminary injunction were held on August 18, 23, and 25, 1989. The writ was granted on this last date. The parties
also agreed to submit the case for resolution on the sole issue of whether there was a law or ordinance authorizing
the removal of the license plates of illegally parked vehicles. The parties then submitted simultaneous memoranda in
support of their respective positions, following which the respondent judge rendered the assailed decision.

In ruling for the complainant, Judge Gonong held that LOI 43, which the defendant had invoked, did not empower it
"to detach, remove and confiscate vehicle plates of motor vehicles illegally parked and unattended as in the case at
bar. It merely authorizes the removal of said vehicles when they are obstacles to free passage or continued flow of
traffic on streets and highways." At any rate, he said, the LOI had been repealed by PD 1605. Moreover, the
defendant had not been able to point to any MMC rule or regulation or to any city ordinance to justify the questioned
act. On the allegation that the practice was "the root cause of graft and corruption or at the very least the equivalent
of street racket among defendant's deployed agents," His Honor made the following pointed observations:

At this juncture, it may not be amiss to say, that if the arbitrary and capricious detachment and confiscation of
vehicles plates illegally parked and unattended as in the act complained of in the instant case, the image of the man
clothed in a traffic or police uniform will be greatly impaired if not cursed with disrespect on the part of those who
have suffered at his hands. Worse, he will cease (if he had not already ceased) to be the law-abiding, courageous
and valiant protector of a citizen of the Republic that he is meant to be, and instead his real oppressor and enemy,
thereby fortifying the contemporaneous public perception that he is a dyed-in-the-wool extortionist if not an
unmitigated chiseler. 1

It bears noting that this petition should have been filed first with the Court of Appeals, which has concurrent
jurisdiction with this Court on decisions of the regional trial courts involving questions of law. However, in view of the
importance of the issue raised, we have decided to take cognizance thereof under Rule 65 of the Rules of Court so
we can address and resolve the question directly.

Upon the filing of this petition, we issued a temporary restraining order dated February 6, 1990, to prevent
enforcement of the said decision until further orders from this Court. Thereafter, we required a comment from the
private respondent, to which the petitioner filed a reply as also directed.

The petitioner reiterates and reinforces its argument in the court below and insists that LOI 43 remains in force
despite the issuance of PD 1605. It contends that there is no inconsistency between the two measures because the
former deals with illegally parked vehicles anywhere in the Philippines whereas the latter deals with the regulation of
the flow of traffic in the Metro Manila area only. The two measures may be enforced together because implied
repeals are not favored and, furthermore, to look at them another way, LOI 43 is the special law dealing only with
illegal parking while PD 1605 is the general law dealing with all other kinds of traffic violations. The special law must
of course prevail over the general law. The petitioner also deplores the above-quoted remarks of the trial judge,
pointing out that the parties had agreed to limit the issue to whether there was a statutory basis for the act
complained of. And even assuming that abuses have been committed in the enforcement of LOI 43, the remedy is
not to disregard it or consider it revoked but to prosecute the guilty parties.
In his comment, the private respondent argues that LOI 43 has been repealed by PD 1605, which specifies all the
sanctions available against the various traffic violations, including illegal parking. He stresses that removal and
confiscation of the license plates of illegally parked vehicles is not one of them, the penalties being limited in the
decree to imposition of fine and suspension or revocation of driver's licenses or certificates of public convenience,
etc. Expressio unius est exclusio alterius. He agrees that the special law prevails over the general law but maintains
it is PD 1605 that is the special law because it is applicable only on Metro Manila and LOI 43 that is the general law
because it was intended to operate throughout the country. As for his allegation that the challenged practice is a
source of graft, he maintains that it was not improper to discuss it in his memorandum because it was pertinent to the
central issue under consideration. Finally, he claims that removal and confiscation of the license plate without notice
and hearing violates due process because such license plate is a form of property protected by the Bill of Rights
against unlawful deprivation.

In its reply, the petitioner faults the private respondent for belatedly raising the constitutionality of LOI 43, suggesting
faintly that this should not be permitted. In any case, it maintains, the license plate is not property in the constitutional
sense, being merely the identification of the vehicle, and its "temporary confiscation" does not deprive the owner of
the use of the vehicle itself. Hence, there is no unlawful taking under the due process clause. The petitioner also
takes issue with the contention that it is PD 1605 that should be considered the special law because of its limited
territorial application. Repeal of LOI 43 on that ground would run counter to the legislative intention as it is in fact in
Metro Manila that the problem of illegal parking is most acute.

LOI 43, entitled Measures to Effect a Continuing Flow of Transportation on Streets and Highways, was issued on
November 28, 1972, with the following pertinent provisions:

Motor vehicles that stall on the streets and highways, streets and sidewalks, shall immediately be removed by their
owners/users; otherwise said vehicles shall be dealt with and disposed in the manner stated hereunder;

1. For the first offense the stalled or illegally parked vehicle shall be removed, towed and impounded at the expense
of the owner, user or claimant;

2. For the second and subsequent offenses, the registry plates of the vehicles shall be confiscated and the owner's
certificate of registration cancelled. (Emphasis supplied).

PD 1605 (Granting the Metropolitan Manila Commission Central Powers Related to Traffic Management, Providing
Penalties, and for Other Purposes) was issued, also by President Marcos, on November 21, 1978, and pertinently
provides:

Section 1. The Metropolitan Manila Commission shall have the power to impose fines and otherwise discipline drivers
and operators of motor vehicles for violations of traffic laws, ordinances, rules and regulations in Metropolitan Manila
in such amounts and under such penalties as are herein prescribed. For his purpose, the powers of the Land
Transportation Commission and the Board of Transportation under existing laws over such violations and punishment
thereof are hereby transferred to the Metropolitan Manila Commission. When the proper penalty to be imposed is
suspension or revocation of driver's license or certificate of public convenience, the Metropolitan Manila Commission
or its representatives shall suspend or revoke such license or certificate. The suspended or revoked driver's license
or the report of suspension or revocation of the certificate of public convenience shall be sent to the Land
Transportation Commission or the Board of Transportation, as the case may be, for their records update.

xxx xxx xxx

Section 3. Violations of traffic laws, ordinances, rules and regulations, committed within a twelve-month period,
reckoned from the date of birth of the licensee, shall subject the violator to graduated fines as follows: P10.00 for the
first offense, P20.00 for the second offense, P50.00 for the third offense, a one-year suspension of driver's license for
the fourth offense, and a revocation of the driver' license for the fifth offense: Provided, That the Metropolitan Manila
Commission may impose higher penalties as it may deem proper for violations of its ordinances prohibiting or
regulating the use of certain public roads, streets or thoroughfares in Metropolitan Manila.

xxx xxx xxx

Section 5. In case of traffic violations, the driver's license shall not be confiscated  but the erring driver shall be
immediately issued a traffic citation ticket prescribed by the Metropolitan Manila Commission which shall state the
violation committed, the amount of fine imposed for the violation and an advice that he can make payment to the city
or municipal treasurer where the violation was committed or to the Philippine National Bank or Philippine Veterans
Bank or their branches within seven days from the date of issuance of the citation ticket.
If the offender fails to pay the fine imposed within the period herein prescribed, the Metropolitan Manila Commission
or the law enforcement agency concerned shall endorse the case to the proper fiscal for appropriate proceedings
preparatory to the filing of the case with the competent traffic court, city or municipal court.

If at the time a driver renews his driver's license and records show that he has an unpaid fine, his driver's license
shall not be renewed until he has paid the fine and corresponding surcharges.

xxx xxx xxx

Section 8. Insofar as the Metropolitan Manila area is concerned, all laws, decrees, orders, ordinances, rules and
regulations, or parts thereof inconsistent herewith are hereby repealed or modified accordingly. (Emphasis supplied).

A careful reading of the above decree will show that removal and confiscation of the license plate of any illegally
parked vehicle is not among the specified penalties. Moreover, although the Metropolitan Manila Commission is
authorized by the decree to "otherwise discipline" and "impose higher penalties" on traffic violators, whatever
sanctions it may impose must be "in such amounts and under such penalties as are herein prescribed." The
petitioner has not pointed to any such additional sanctions, relying instead on its argument that the applicable
authority for the questioned act is LOI 43.

The petitioner stresses that under the decree, "the powers of the Land Transportation Commission and the Board of
Transportation over such violations and punishment thereof are (hereby) transferred to the Metropolitan Manila
Commission," and one of such laws is LOI 43. The penalties prescribed by the LOI are therefore deemed
incorporated in PD 1605 as additional to the other penalties therein specified.

It would appear that what the LOI punishes is not a traffic violation but a traffic obstruction, which is an altogether
different offense. A violation imports an intentional breach or disregard of a rule, as where a driver leaves his vehicle
in a no-parking area against a known and usually visible prohibition. Contrary to the common impression, LOI 43
does not punish illegal parking per se but parking of stalled vehicles, i.e., those that involuntarily stop on the road due
to some unexpected trouble such as engine defect, lack of gasoline, punctured tires, or other similar cause. The
vehicle is deemed illegally parked because it obstructs the flow of traffic, but only because it has stalled. The
obstruction is not deliberate. In fact, even the petitioner recognizes that "there is a world of difference between a
stalled vehicle and an illegally parked and unattended one" and suggests a different treatment for either. "The first
means one which stopped unnecessarily or broke down while the second means one which stopped to accomplish
something, including temporary rest. 2

LOI 43 deals with motor vehicles "that stall on the streets and highways' and not those that are intentionally parked in
a public place in violation of a traffic law or regulation. The purpose of the LOI evidently is to discipline the motorist
into keeping his vehicle in good condition before going out into the streets so as not to cause inconvenience to the
public when the car breaks down and blocks other vehicles. That is why, for the first offense, the stalled vehicle is
immediately towed at the owner's expense to clear the street of the traffic obstruction. Where it appears that the
owner has not learned from his first experience because the vehicle has stalled again, presumably due to his failure
to repair it, the penalty shall be confiscation of the license plate and cancellation of the certificate of registration
petition.

It is worth noting that it is not the driver's license that is confiscated and canceled when the vehicle stalls on a public
street. The LOI goes against the vehicle itself. The object of the measure is to ensure that only motor vehicles in
good condition may use the public streets, and this is effected by confiscating the license plates and canceling the
certificates of registration of those vehicles that are not roadworthy.

In the case of the private respondent, it is not alleged or shown that his vehicle stalled on a public thoroughfare and
obstructed the flow of traffic. The charge against him is that he purposely parked his vehicle in a no parking area
(although this is disputed by him).i•t•c-aüsl The act, if true, is a traffic violation that may not be punished under LOI
43. The applicable law is PD 1605, which does not include removal and confiscation of the license plate of the
vehicle among the imposable penalties.

Indeed, even if LOI 43 were applicable, the penalty of confiscation would still not be justified as it has not been
alleged, much less shown, that the illegal parking was a second or subsequent offense. That circumstance must be
established at a trial before a court of justice where the vehicle owner shall have a right to be heard in his defense.
The second or subsequent offense cannot be simply pronounced by the traffic authorities without hearing and without
proof. Confiscation of the registry plate without a judicial finding that the offense charge is a second or subsequent
one would, unless the owner concedes this point, be invalid.

While it is true that the license plate is strictly speaking not a property right, it does not follow that it may be removed
or confiscated without lawful cause. Due process is a guaranty against all forms of official arbitrariness. Under the
principle that ours is a government of laws and not of men, every official must act by and within the authority of a
valid law and cannot justify the lack of it on the pretext alone of good intentions. It is recalled that more than seventy
years ago, the mayor of Manila deported one hundred seventy prostitutes to Davao for the protection of the morals
and health of the city. This Court acknowledged his praiseworthy purpose but just the same annulled his
unauthorized act, holding that no one could take the law into his own hands. 3 We can rule no less in the case before
us.

We find that there is no inconsistency between LOI 43 and PD 1605, whichever is considered the special law either
because of its subject or its territorial application. The former deals with motor vehicles that have stalled on a public
road while the latter deals with motor vehicles that have been deliberately parked in a no-parking area; and while
both cover illegal parking of motor vehicles, the offense is accidental under the first measure and intentional under
the second. This explains why the sanctions are different. The purpose of the LOI is to discourage the use of the
public streets by motor vehicles that are likely to break down while that of the decree is to penalize the driver for his
defiance of the traffic laws.

As it has not been shown that the private respondent's motor vehicle had stalled because of an engine defect or
some other accidental cause and, no less importantly, that it had stalled on the road for a second or subsequent time,
confiscation of the license plate cannot be justified under LOI 43. And neither can that sanction be sustained under
PD 1605, which clearly provides that "in case of traffic violations, (even) the driver's license shall not be confiscated,"
let alone the license plate of the motor vehicle. If at all, the private respondent may be held liable for illegal parking
only and subjected to any of the specific penalties mentioned in Section 3 of the decree.

We recognize the problem of the traffic policeman who comes upon an illegally parked and unattended vehicle and is
unable to serve a citation on the offending driver who is nowhere in sight. But that problem is not addressed to the
courts; it is for the legislative and administrative authorities to solve. What is clear to the Court is that the difficulty
cannot be avoided by the removal of the license plate of the offending vehicle because the petitioner has not shown
that this penalty is authorized by a valid law or ordinance.

The petitioner complains that the respondent judge did not confine himself to the issue agreed upon by the parties
and made gratuitous accusations that were not only irrelevant but virtually condemned the whole traffic force as
corrupt. Assuming that this issue was indeed not properly raised at the trial, the Court is nevertheless not inhibited
from considering it in this proceeding, on the basis of its own impressions on the matter.

This Court is not isolated from the mainstream of society and secluded in a world of its own, unconcerned with the
daily lives of the rest of the nation. On the contrary, the members of this Court mix with the people and know their
problems and complaints. And among these are the alleged abuses of the police in connection with the issue now
before us.

It is claimed that the removal of the license plates of illegally parked motor vehicles in Metro Manila has become a
veritable gold mine for some police officers. To be sure, we do not have hard, provable facts at hand but only vague
and unsubstantiated rumors that could be no more than malicious and invented charges. Nevertheless, these
accusations have become too prevalent and apparently too persuasive that they cannot be simply swept under the
rug.

The widespread report is that civilian "agents," mostly street urchins under the control and direction of certain
policemen, remove these license plates from illegally parked vehicles and later discreetly suggest to the owners that
these may be retrieved for an unofficial fee. This ranges from P50.00 to P200.00, depending on the type of vehicle. If
the owner agrees, payment is usually made and the license plate returned at a private rendezvous. No official receipt
is issued. Everything is done quietly. The owners, it is said, prefer this kind of fast settlement to the inconvenience of
an official proceeding that may entail not only the payment of a higher fine but also other administrative impositions,
like attendance at a traffic seminar.

The Court is not saying that these reports are true nor is it stigmatizing the entire police force on the basis of these
unsubstantiated charges. But it does believe and stress that the proper authorities should take official notice of these
reports instead of blandly dismissing them as mere canards that do not deserve their attention and concern. An
inquiry is in our view indicated. The old adage that where there's smoke there's fire is not necessarily true and can
hardly be the rationale of a judicial conclusion; but the Court feels just the same that serious steps should be taken,
especially because of the persistence of these charges, to determine the source of the smoke.

We realize the seriousness of our traffic problems, particularly in Metro Manila, and commend the earnest efforts of
the police to effect a smoother flow of vehicles in the public thoroughfares for the comfort and convenience of the
people. But we must add, as a reminder that must be made, that such efforts must be authorized by a valid law,
which must clearly define the offenses proscribed and as clearly specify the penalties prescribed.

WHEREFORE, the petition is DISMISSED. The Court holds that LOI 43 is valid but may be applied only against
motor vehicles that have stalled in the public streets due to some involuntary cause and not those that have been
intentionally parked in violation of the traffic laws. The challenged decision of the trial court is AFFIRMED in so far as
it enjoins confiscation of the private respondent's license plate for alleged deliberate illegal parking, which is subject
to a different penalty. The temporary restraining order dated February 6, 1990, is LIFTED.

SO ORDERE

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-59180 January 29, 1987

CLEMENTINO TORRALBA and RESOLUTION L. RUGAY, petitioners, 

vs.
THE MUNICIPALITY OF SIBAGAT, PROVINCE OF AGUSAN DEL SUR and ITS MUNICIPAL
OFFICERS, respondents.

MELENCIO-HERRERA, J.:

Challenged in the instant Petition, as violative of Section 3, Article XI of the 1973 Constitution, is Batas Pambansa
Blg. 56, enacted on 1 February 1980, creating the Municipality of Sibagat, Province of Agusan del Sur. The pertinent
provisions of BP 56 read:

Sec. 1. The barangays of Ilihan, Sinai, Sibagat, El Rio, Afga, Tabontabon, Perez, Magsaysay, Santa Cruz, Santa
Maria, San Isidro, Villangit, Del Rosario, Anahauan Mahayahay, and San Vicente, all in the Municipality of Bayugan,
Province of Agusan del Sur, are hereby separated from said municipality to form and constitute an independent
Municipality of Sibagat without affecting in any manner the legal existence of the mother Municipality of Bayugan.

Sec. 2. The boundaries of the new Municipality of Sibagat will be: Beginning at the point of intersection of the
Cabadbaran-Old Bayugan and Surigao del Sur boundaries; thence in a southernly direction following the Old
Bayugan and Cabadbaran, Old Bayugan and Butuan City, Old Bayugan and Las Nieves boundaries, until it reaches
the point of intersection of Old Bayugan, Esperanza and the Municipality of Las Nieves; ...

Sec. 3. The seat of government of the newly created municipality shall be in Barangay Sibagat.

Sec. 4. Except as herein provided, all provisions of laws, now or hereafter applicable to regular municipalities shall be
applicable to the new Municipality of Sibagat.

Sec. 5. After ratification by the majority of the votes cast in a plebiscite to be conducted in the area or areas affected
within a period of ninety (90) days after the approval of this Act, the President (Prime Minister) shall appoint the
Mayor and other Officials of the new Municipality of Sibagat.

Petitioners are residents and taxpayers of Butuan City, with petitioner, Clementino Torralba, being a member of the
Sangguniang Panglunsod of the same City. Respondent municipal officers are the local public officials of the new
Municipality.

Section 3, Article XI of the 1973 Constitution, said to have been infringed, is reproduced hereunder:

Sec. 3. No province, city, municipality, or barrio may be created, divided, merged, abolished, or its boundary
substantially altered, except in accordance with the criteria established in the Local Government Code, and subject to
the approval by a majority of the votes cast in a plebiscite in the unit or units affected.

The thrust of petitioners' argument is that under the aforequoted provision, the Local Government Code must first be
enacted to determine the criteria for the creation, division, merger, abolition, or substantial alteration of the boundary
of any province, city, municipality, or barrio; and that since no Local Government Code had as yet been enacted as of
the date BP 56 was passed, that statute could not have possibly complied with any criteria when respondent
Municipality was created, hence, it is null and void.

It is a fact that the Local Government Code came into being only on 10 February 1983 so that when BP 56 was
enacted, the code was not yet in existence. The evidence likewise discloses that a plebiscite had been conducted
among the people of the unit/units affected by the creation of the new Municipality, who expressed approval thereof;
and that officials of the newly created Municipality had been appointed and had assumed their respective positions
as such.

We find no trace of invalidity of BP 56. The absence of the Local Government Code at the time of its enactment did
not curtail nor was it intended to cripple legislative competence to create municipal corporations. Section 3, Article XI
of the 1973 Constitution does not proscribe nor prohibit the modification of territorial and political subdivisions before
the enactment of the Local Government Code. It contains no requirement that the Local Government Code is a
condition sine qua non for the creation of a municipality, in much the same way that the creation of a new
municipality does not preclude the enactment of a Local Government Code. What the Constitutional provision means
is that once said Code is enacted, the creation, modification or dissolution of local government units should conform
with the criteria thus laid down. In the interregnum before the enactment of such Code, the legislative power remains
plenary except that the creation of the new local government unit should be approved by the people concerned in a
plebiscite called for the purpose.

The creation of the new Municipality of Sibagat conformed to said requisite. A plebiscite was conducted and the
people of the unit/units affected endorsed and approved the creation of the new local government unit (parag. 5,
Petition; p. 7, Memorandum).lwphl@itç In fact, the conduct of said plebiscite is not questioned herein. The officials of
the new Municipality have effectively taken their oaths of office and are performing their functions. A dejure entity has
thus been created.

It is a long-recognized principle that the power to create a municipal corporation is essentially legislative in nature. In
the absence of any constitutional limitations a legislative body may Create any corporation it deems essential for the
more efficient administration of government (I McQuillin, Municipal Corporations, 3rd ed., 509). The creation of the
new Municipality of Sibagat was a valid exercise of legislative power then vested by the 1973 Constitution in the
Interim Batasang Pambansa.

We are not unmindful of the case of Tan vs. COMELEC (142 SCRA 727 [1986]), striking down as unconstitutional BP
Blg. 885 creating a new province in the Island of Negros known as the Province of Negros del Norte, and declaring
the plebiscite held in connection therewith as illegal There are significant differences, however, in the two cases
among which may be mentioned the following. in the Tan case, the Local Government Code already existed at the
time that the challenged statute was enacted on 3 December 1985; not so in the case at bar. Secondly, BP Blg. 885
in the Tan case confined the plebiscite to the "proposed new province" to the exclusion of the voters in the remaining
areas, in contravention of the Constitutional mandate and of the Local Government Code that the plebiscite should
be held "in the unit or units affected." In contrast, BP 56 specifically provides for a plebiscite "in the area or areas
affected." In fact, as previously stated, no question is raised herein as to the legality of the plebiscite conducted.
Thirdly, in the Tan case, even the requisite area for the creation of a new province was not complied with in BP Blg.
885. No such issue in the creation of the new municipality has been raised here. And lastly, "indecent haste"
attended the enactment of BP Blg. 885 and the holding of the plebiscite thereafter in the Tan case; on the other hand,
BP 56 creating the Municipality of Sibagat, was enacted in the normal course of legislation, and the plebiscite was
held within the period specified in that law.

WHEREFORE, the Petition is hereby dismissed. No costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-114783 December 8, 1994

ROBERT V. TOBIAS, RAMON M. GUZMAN, TERRY T. LIM, GREGORIO D. GABRIEL, and ROBERTO R.
TOBIAS, JR. petitioners, 
vs.
HON. CITY MAYOR BENJAMIN S. ABALOS, CITY TREASURER WILLIAM MARCELINO, and THE
SANGGUNIANG PANLUNGSOD, all of the City of Mandaluyong, Metro Manila, respondents.

Estrella, Bautista & Associates for petitioners.

BIDIN, J.:

Invoking their rights as taxpayers and as residents of Mandaluyong, herein petitioners assail the constitutionality of
Republic Act No. 7675, otherwise known as "An Act Converting the Municipality of Mandaluyong into a Highly
Urbanized City to be known as the City of Mandaluyong."

Prior to the enactment of the assailed statute, the municipalities of Mandaluyong and San Juan belonged to only one
legislative district. Hon. Ronaldo Zamora, the incumbent congressional representative of this legislative district,
sponsored the bill which eventually became R.A. No. 7675. President Ramos signed R.A. No. 7675 into law on
February 9, 1994.

Pursuant to the Local Government Code of 1991, a plebiscite was held on April 10, 1994. The people of
Mandaluyong were asked whether they approved of the conversion of the Municipality of Mandaluyong into a highly
urbanized city as provided under R.A. No. 7675. The turnout at the plebiscite was only 14.41% of the voting
population. Nevertheless, 18,621 voted "yes" whereas 7,911 voted "no." By virtue of these results, R.A. No. 7675
was deemed ratified and in effect.

Petitioners now come before this Court, contending that R.A. No. 7675, specifically Article VIII, Section 49 thereof, is
unconstitutional for being violative of three specific provisions of the Constitution.

Article VIII, Section 49 of R.A. No. 7675 provides:

As a highly-urbanized city, the City of Mandaluyong shall have its own legislative district with the first representative
to be elected in the next national elections after the passage of this Act. The remainder of the former legislative
district of San Juan/Mandaluyong shall become the new legislative district of San Juan with its first representative to
be elected at the same election.

Petitioner's first objection to the aforequoted provision of R.A. No. 7675 is that it contravenes the "one subject-one
bill" rule, as enunciated in Article VI, Section 26(1) of the Constitution, to wit:

Sec. 26(1). Every bill passed by the Congress shall embrace only one subject which shall be expressed in the title
thereof.

Petitioners allege that the inclusion of the assailed Section 49 in the subject law resulted in the latter embracing two
principal subjects, namely: (1) the conversion of Mandaluyong into a highly urbanized city; and (2) the division of the
congressional district of San Juan/Mandaluyong into two separate districts.

Petitioners contend that the second aforestated subject is not germane to the subject matter of R.A. No. 7675 since
the said law treats of the conversion of Mandaluyong into a highly urbanized city, as expressed in the title of the law.
Therefore, since Section 49 treats of a subject distinct from that stated in the title of the law, the "one subject-one bill"
rule has not been complied with.
Petitioners' second and third objections involve Article VI, Sections 5(1) and (4) of the Constitution, which provide, to
wit:

Sec. 5(1). The House of Representatives shall be composed of not more than two hundred and fifty members, unless
otherwise fixed by law, who shall be elected from legislative districts apportioned among the provinces, cities, and the
Metropolitan Manila area in accordance with the number of their respective inhabitants, and on the basis of a uniform
and progressive ratio, and those who, as provided by law, shall be elected through a party list system of registered
national, regional and sectoral parties or organizations.

Sec. 5(4). Within three years following the return of every census, the Congress shall make a reapportionment of
legislative districts based on the standard provided in this section.

Petitioners argue that the division of San Juan and Mandaluyong into separate congressional districts under Section
49 of the assailed law has resulted in an increase in the composition of the House of Representatives beyond that
provided in Article VI, Sec. 5(1) of the Constitution. Furthermore, petitioners contend that said division was not made
pursuant to any census showing that the subject municipalities have attained the minimum population requirements.
And finally, petitioners assert that Section 49 has the effect of preempting the right of Congress to reapportion
legislative districts pursuant to Sec. 5(4) as aforecited.

The contentions are devoid of merit.

Anent the first issue, we agree with the observation of the Solicitor General that the statutory conversion of
Mandaluyong into a highly urbanized city with a population of not less than two hundred fifty thousand indubitably
ordains compliance with the "one city-one representative" proviso in the Constitution:

. . . Each city with a population of at least two hundred fifty thousand, or each province, shall have at least one
representative" (Article VI, Section 5(3), Constitution).

Hence, it is in compliance with the aforestated constitutional mandate that the creation of a separate congressional
district for the City of Mandaluyong is decreed under Article VIII, Section 49 of R.A. No. 7675.

Contrary to petitioners' assertion, the creation of a separate congressional district for Mandaluyong is not a subject
separate and distinct from the subject of its conversion into a highly urbanized city but is a natural and logical
consequence of its conversion into a highly urbanized city. Verily, the title of R.A. No. 7675, "An Act Converting the
Municipality of Mandaluyong Into a Highly Urbanized City of Mandaluyong" necessarily includes and contemplates
the subject treated under Section 49 regarding the creation of a separate congressional district for Mandaluyong.

Moreover, a liberal construction of the "one title-one subject" rule has been invariably adopted by this court so as not
to cripple or impede legislation. Thus, in Sumulong v. Comelec (73 Phil. 288 [1941]), we ruled that the constitutional
requirement as now expressed in Article VI, Section 26(1) "should be given a practical rather than a technical
construction. It should be sufficient compliance with such requirement if the title expresses the general subject and all
the provisions are germane to that general subject."

The liberal construction of the "one title-one subject" rule had been further elucidated in Lidasan v. Comelec (21
SCRA 496 [1967]), to wit:

Of course, the Constitution does not require Congress to employ in the title of an enactment, language of such
precision as to mirror, fully index or catalogue all the contents and the minute details therein. It suffices if the title
should serve the purpose of the constitutional demand that it inform the legislators, the persons interested in the
subject of the bill and the public, of the nature, scope and consequences of the proposed law and its operation"
(emphasis supplied).

Proceeding now to the other constitutional issues raised by petitioners to the effect that there is no mention in the
assailed law of any census to show that Mandaluyong and San Juan had each attained the minimum requirement of
250,000 inhabitants to justify their separation into two legislative districts, the same does not suffice to strike down
the validity of R.A. No. 7675. The said Act enjoys the presumption of having passed through the regular
congressional processes, including due consideration by the members of Congress of the minimum requirements for
the establishment of separate legislative districts. At any rate, it is not required that all laws emanating from the
legislature must contain all relevant data considered by Congress in the enactment of said laws.

As to the contention that the assailed law violates the present limit on the number of representatives as set forth in
the Constitution, a reading of the applicable provision, Article VI, Section 5(1), as aforequoted, shows that the present
limit of 250 members is not absolute. The Constitution clearly provides that the House of Representatives shall be
composed of not more than 250 members, "unless otherwise provided by law." The inescapable import of the latter
clause is that the present composition of Congress may be increased, if Congress itself so mandates through a
legislative enactment. Therefore, the increase in congressional representation mandated by R.A. No. 7675 is not
unconstitutional.

Thus, in the absence of proof that Mandaluyong and San Juan do not qualify to have separate legislative districts, the
assailed Section 49 of R.A.
No. 7675 must be allowed to stand.

As to the contention that Section 49 of R.A. No. 7675 in effect preempts the right of Congress to reapportion
legislative districts, the said argument borders on the absurd since petitioners overlook the glaring fact that it was
Congress itself which drafted, deliberated upon and enacted the assailed law, including Section 49 thereof. Congress
cannot possibly preempt itself on a right which pertains to itself.

Aside from the constitutional objections to R.A. No. 7675, petitioners present further arguments against the validity
thereof.

Petitioners contend that the people of San Juan should have been made to participate in the plebiscite on R.A. No.
7675 as the same involved a change in their legislative district. The contention is bereft of merit since the principal
subject involved in the plebiscite was the conversion of Mandaluyong into a highly urbanized city. The matter of
separate district representation was only ancillary thereto. Thus, the inhabitants of San Juan were properly excluded
from the said plebiscite as they had nothing to do with the change of status of neighboring Mandaluyong.

Similarly, petitioners' additional argument that the subject law has resulted in "gerrymandering," which is the practice
of creating legislative districts to favor a particular candidate or party, is not worthy of credence. As correctly
observed by the Solicitor General, it should be noted that Rep. Ronaldo Zamora, the author of the assailed law, is the
incumbent representative of the former San Juan/Mandaluyong district, having consistently won in both localities. By
dividing San Juan/Mandaluyong, Rep. Zamora's constituency has in fact been diminished, which development could
hardly be considered as favorable to him.

WHEREFORE, the petition is hereby DISMISSED for lack of merit.

SO ORDERED.
 FIRST DIVISION

[G.R. No. 148622. September 12, 2002]

REPUBLIC OF THE PHILIPPINES, represented by HON. HEHERSON T. ALVAREZ, in his capacity as Secretary
of the DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (DENR), CLARENCE L.
BAGUILAT, in his capacity as the Regional Executive Director of DENR-Region XI and ENGR.
BIENVENIDO L. LIPAYON, in his capacity as the Regional Director of the DENR-ENVIRONMENTAL
MANAGEMENT BUREAU (DENR-EMB), Region XI, petitioners, vs. THE CITY OF DAVAO,
represented by BENJAMIN C. DE GUZMAN, City Mayor, respondent.

DECISION

YNARES-SANTIAGO, J.:

Before us is a petition for review[1] on certiorari assailing the decision [2] dated May 28, 2001 of the Regional Trial
Court of Davao City, Branch 33, which granted the writ of mandamus and injunction in favor of respondent, the City
of Davao, and against petitioner, the Republic, represented by the Department of Environment and Natural
Resources (DENR). The trial court also directed petitioner to issue a Certificate of Non-Coverage in favor of
respondent.

The antecedent facts of the case are as follows:

On August 11, 2000, respondent filed an application for a Certificate of Non-Coverage (CNC) for its proposed
project, the Davao City Artica Sports Dome, with the Environmental Management Bureau (EMB), Region
XI. Attached to the application were the required documents for its issuance, namely, a) detailed location map of the
project site; b) brief project description; and c) a certification from the City Planning and Development Office that the
project is not located in an environmentally critical area (ECA). The EMB Region XI denied the application after
finding that the proposed project was within an environmentally critical area and ruled that, pursuant to Section 2,
Presidential Decree No. 1586, otherwise known as the Environmental Impact Statement System, in relation to
Section 4 of Presidential Decree No, 1151, also known as the Philippine Environment Policy, the City of Davao must
undergo the environmental impact assessment (EIA) process to secure an Environmental Compliance Certificate
(ECC), before it can proceed with the construction of its project.

Believing that it was entitled to a Certificate of Non-Coverage, respondent filed a petition for mandamus and
injunction with the Regional Trial Court of Davao, docketed as Civil Case No. 28,133-2000. It alleged that its
proposed project was neither an environmentally critical project nor within an environmentally critical area; thus it was
outside the scope of the EIS system. Hence, it was the ministerial duty of the DENR, through the EMB-Region XI, to
issue a CNC in favor of respondent upon submission of the required documents.

The Regional Trial Court rendered judgment in favor of respondent, the dispositive portion of which reads as
follows:

WHEREFORE, finding the petition to be meritorious, judgment granting the writ of mandamus and injunction is
hereby rendered in favor of the petitioner City of Davao and against respondents Department of Environment and
Natural Resources and the other respondents by:

1) directing the respondents to issue in favor of the petitioner City of Davao a Certificate of Non-Coverage, pursuant
to Presidential Decree No. 1586 and related laws, in connection with the construction by the City of Davao of the
Artica Sports Dome;

2) making the preliminary injunction issued on December 12, 2000 permanent.

Costs de oficio.

SO ORDERED.[3]

The trial court ratiocinated that there is nothing in PD 1586, in relation to PD 1151 and Letter of Instruction No.
1179 (prescribing guidelines for compliance with the EIA system), which requires local government units (LGUs) to
comply with the EIS law. Only agencies and instrumentalities of the national government, including government
owned or controlled corporations, as well as private corporations, firms and entities are mandated to go through the
EIA process for their proposed projects which have significant effect on the quality of the environment. A local
government unit, not being an agency or instrumentality of the National Government, is deemed excluded under the
principle of expressio unius est exclusio alterius.

The trial court also declared, based on the certifications of the DENR-Community Environment and Natural
Resources Office (CENRO)-West, and the data gathered from the Philippine Institute of Volcanology and Seismology
(PHIVOLCS), that the site for the Artica Sports Dome was not within an environmentally critical area. Neither was the
project an environmentally critical one. It therefore becomes mandatory for the DENR, through the EMB Region XI, to
approve respondents application for CNC after it has satisfied all the requirements for its issuance. Accordingly,
petitioner can be compelled by a writ of mandamus to issue the CNC, if it refuses to do so.

Petitioner filed a motion for reconsideration, however, the same was denied. Hence, the instant petition for
review.

With the supervening change of administration, respondent, in lieu of a comment, filed a manifestation
expressing its agreement with petitioner that, indeed, it needs to secure an ECC for its proposed project.  It thus
rendered the instant petition moot and academic. However, for the guidance of the implementors of the EIS law and
pursuant to our symbolic function to educate the bench and bar, [4] we are inclined to address the issue raised in this
petition.

Section 15 of Republic Act 7160,[5] otherwise known as the Local Government Code, defines a local
government unit as a body politic and corporate endowed with powers to be exercised by it in conformity with law. As
such, it performs dual functions, governmental and proprietary. Governmental functions are those that concern the
health, safety and the advancement of the public good or welfare as affecting the public generally. [6] Proprietary
functions are those that seek to obtain special corporate benefits or earn pecuniary profit and intended for private
advantage and benefit.[7] When exercising governmental powers and performing governmental duties, an LGU is an
agency of the national government.[8] When engaged in corporate activities, it acts as an agent of the community in
the administration of local affairs.[9]

Found in Section 16 of the Local Government Code is the duty of the LGUs to promote the peoples right to a
balanced ecology.[10] Pursuant to this, an LGU, like the City of Davao, can not claim exemption from the coverage of
PD 1586. As a body politic endowed with governmental functions, an LGU has the duty to ensure the quality of the
environment, which is the very same objective of PD 1586.

Further, it is a rule of statutory construction that every part of a statute must be interpreted with reference to the
context, i.e., that every part must be considered with other parts, and kept subservient to the general intent of the
enactment.[11] The trial court, in declaring local government units as exempt from the coverage of the EIS law, failed
to relate Section 2 of PD 1586[12] to the following provisions of the same law:

WHEREAS, the pursuit of a comprehensive and integrated environmental protection program necessitates the
establishment and institutionalization of a system whereby the exigencies of socio-economic undertakings can be
reconciled with the requirements of environmental quality; x x x.

Section 1. Policy. It is hereby declared the policy of the State to attain and maintain a rational and orderly balance
between socio-economic growth and environmental protection.

x x x x x x x x x

Section 4. Presidential Proclamation of Environmentally Critical Areas and Projects. The President of the Philippines
may, on his own initiative or upon recommendation of the National Environmental Protection Council, by
proclamation declare certain projects, undertakings or areas in the country as environmentally critical. No person,
partnership or corporation shall undertake or operate any such declared environmentally critical project or area
without first securing an Environmental Compliance Certificate issued by the President or his duly authorized
representative. For the proper management of said critical project or area, the President may by his proclamation
reorganize such government offices, agencies, institutions, corporations or instrumentalities including the realignment
of government personnel, and their specific functions and responsibilities.

Section 4 of PD 1586 clearly states that no person, partnership or corporation shall undertake or operate any
such declared environmentally critical project or area without first securing an Environmental Compliance Certificate
issued by the President or his duly authorized representative. [13] The Civil Code defines a person as either natural or
juridical. The state and its political subdivisions, i.e., the local government units [14] are juridical persons.
[15]
 Undoubtedly therefore, local government units are not excluded from the coverage of PD 1586.

Lastly, very clear in Section 1 of PD 1586 that said law intends to implement the policy of the state to achieve a
balance between socio-economic development and environmental protection, which are the twin goals of sustainable
development. The above-quoted first paragraph of the Whereas clause stresses that this can only be possible if we
adopt a comprehensive and integrated environmental protection program where all the sectors of the community are
involved, i.e., the government and the private sectors. The local government units, as part of the machinery of the
government, cannot therefore be deemed as outside the scope of the EIS system.[16]
 The foregoing arguments, however, presuppose that a project, for which an Environmental Compliance
Certificate is necessary, is environmentally critical or within an environmentally critical area.  In the case at bar,
respondent has sufficiently shown that the Artica Sports Dome will not have a significant negative environmental
impact because it is not an environmentally critical project and it is not located in an environmentally critical area.  In
support of this contention, respondent submitted the following:

1. Certification from the City Planning and Development Office that the project is not located in an environmentally
critical area;

2. Certification from the Community Environment and Natural Resources Office (CENRO-West) that the project area
is within the 18-30% slope, is outside the scope of the NIPAS (R.A. 7586), and not within a declared watershed area;
and

3. Certification from PHILVOCS that the project site is thirty-seven (37) kilometers southeast of the southernmost
extension of the Davao River Fault and forty-five (45) kilometers west of the Eastern Mindanao Fault; and is outside
the required minimum buffer zone of five (5) meters from a fault zone.

The trial court, after a consideration of the evidence, found that the Artica Sports Dome is not within an
environmentally critical area. Neither is it an environmentally critical project. It is axiomatic that factual findings of the
trial court, when fully supported by the evidence on record, are binding upon this Court and will not be disturbed on
appeal.[17] This Court is not a trier of facts. [18]

There are exceptional instances when this Court may disregard factual findings of the trial court, namely: a)
when the conclusion is a finding grounded entirely on speculations, surmises, or conjectures; b) when the inference
made is manifestly mistaken, absurd, or impossible; c) where there is a grave abuse of discretion; d) when the
judgment is based on a misapprehension of facts; e) when the findings of fact are conflicting; f) when the Court of
Appeals, in making its findings, went beyond the issues of the case and the same are contrary to the admissions of
both appellant and appellee; g) when the findings of the Court of Appeals are contrary to those of the trial court; h)
when the findings of fact are conclusions without citation of specific evidence on which they are based; i) when the
finding of fact of the Court of Appeals is premised on the supposed absence of evidence but is contradicted by the
evidence on record; and j) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the
parties and which, if properly considered, would justify a different conclusion. [19] None of these exceptions, however,
obtain in this case.

The Environmental Impact Statement System, which ensures environmental protection and regulates certain
government activities affecting the environment, was established by Presidential Decree No. 1586. Section 2 thereof
states:

There is hereby established an Environmental Impact Statement System founded and based on the environmental
impact statement required under Section 4 of Presidential Decree No. 1151, of all agencies and instrumentalities of
the national government, including government-owned or controlled corporations, as well as private corporations,
firms and entities, for every proposed project and undertaking which significantly affect the quality of the environment.

Section 4 of PD 1151, on the other hand, provides:

Environmental Impact Statements. Pursuant to the above enunciated policies and goals, all agencies and
instrumentalities of the national government, including government-owned or controlled corporations, as well as
private corporations, firms and entities shall prepare, file and include in every action, project or undertaking which
significantly affects the quality of the environment a detailed statement on

(a) the environmental impact of the proposed action, project or undertaking

(b) any adverse environmental effect which cannot be avoided should the proposal be implemented

(c) alternative to the proposed action

(d) a determination that the short-term uses of the resources of the environment are consistent with the maintenance
and enhancement of the long-term productivity of the same; and

(e) whenever a proposal involves the use of depletable or nonrenewable resources, a finding must be made that
such use and commitment are warranted.

Before an environmental impact statement is issued by a lead agency, all agencies having jurisdiction over, or
special expertise on, the subject matter involved shall comment on the draft environmental impact statement made
by the lead agency within thirty (30) days from receipt of the same.
 Under Article II, Section 1, of the Rules and Regulations Implementing PD 1586, the declaration of certain
projects or areas as environmentally critical, and which shall fall within the scope of the Environmental Impact
Statement System, shall be by Presidential Proclamation, in accordance with Section 4 of PD 1586 quoted above.

Pursuant thereto, Proclamation No. 2146 was issued on December 14, 1981, proclaiming the following areas
and types of projects as environmentally critical and within the scope of the Environmental Impact Statement System
established under PD 1586:

A. Environmentally Critical Projects

I. Heavy Industries

a. Non-ferrous metal industries

b. Iron and steel mills

c. Petroleum and petro-chemical industries including oil and gas

d. Smelting plants

II. Resource Extractive Industries

a. Major mining and quarrying projects

b. Forestry projects

1. Logging

2. Major wood processing projects

3. Introduction of fauna (exotic-animals) in public/private forests

4. Forest occupancy

5. Extraction of mangrove products

6. Grazing

c. Fishery Projects

1. Dikes for/and fishpond development projects

III. Infrastructure Projects

a. Major dams

b. Major power plants (fossil-fueled, nuclear fueled, hydroelectric or geothermal)

c. Major reclamation projects

d. Major roads and bridges

B. Environmentally Critical Areas

1. All areas declared by law as national parks, watershed reserves, wildlife preserves and
sanctuaries;

2. Areas set aside as aesthetic potential tourist spots;

 3. Areas which constitute the habitat for any endangered or threatened species of indigenous
Philippine Wildlife (flora and fauna);

4. Areas of unique historic, archaeological, or scientific interests;

5. Areas which are traditionally occupied by cultural communities or tribes;

6. Areas frequently visited and/or hard-hit by natural calamities (geologic hazards, floods,
typhoons, volcanic activity, etc.);

7. Areas with critical slopes;

8. Areas classified as prime agricultural lands;

9. Recharged areas of aquifers;

10. Water bodies characterized by one or any combination of the following conditions;

a. tapped for domestic purposes

b. within the controlled and/or protected areas declared by appropriate authorities

c. which support wildlife and fishery activities

11. Mangrove areas characterized by one or any combination of the following conditions:

a. with primary pristine and dense young growth;

b. adjoining mouth of major river systems;

c. near or adjacent to traditional productive fry or fishing grounds;

d. which act as natural buffers against shore erosion, strong winds and storm floods;

e. on which people are dependent for their livelihood.

12. Coral reefs, characterized by one or any combinations of the following conditions:

a. with 50% and above live coralline cover;

b. spawning and nursery grounds for fish;

c. which act as natural breakwater of coastlines.

In this connection, Section 5 of PD 1586 expressly states:

Environmentally Non-Critical Projects. All other projects, undertakings and areas not declared by the President as
environmentally critical shall be considered as non-critical and shall not be required to submit an environmental
impact statement. The National Environmental Protection Council, thru the Ministry of Human Settlements may
however require non-critical projects and undertakings to provide additional environmental safeguards as it may
deem necessary.

The Artica Sports Dome in Langub does not come close to any of the projects or areas enumerated
above. Neither is it analogous to any of them. It is clear, therefore, that the said project is not classified as
environmentally critical, or within an environmentally critical area. Consequently, the DENR has no choice but to
issue the Certificate of Non-Coverage. It becomes its ministerial duty, the performance of which can be compelled by
writ of mandamus, such as that issued by the trial court in the case at bar.

WHEREFORE, in view of the foregoing, the instant petition is DENIED. The decision of the Regional Trial
Court of Davao City, Branch 33, in Civil Case No. 28,133-2000, granting the writ of mandamus and directing the
Department of Environment and Natural Resources to issue in favor of the City of Davao a Certificate of Non-
Coverage, pursuant to Presidential Decree No. 1586 and related laws, in connection with the construction of the
Artica Sports Dome, is AFFIRMED.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, and Carpio, JJ., concur.