FACULTY OF CIVIL LAW | POLITICAL LAW

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

PROJECT HEAD:
ONG, CINDEL JOY S.Y.

SUBJECT HEAD:
MERCENE, EDELITO JR.

MEMBERS:
BALUYUT, ROBERT
BAYOMBONG, AXELE
BUENAVENTURA, IVAN
CABARLES, KARL STEVENT
GENOVA, JOHN CHRISTIAN
LONGUI, JOHN EZEQUIEL
MANALASTAS, CHERRIE ANN
MERCENE, EDELITO JR.
NAGORITE, DANICA ELLA
NATABLA, MICHAEL JOHN
ONG, CINDEL JOY S.Y.
TENECIO, JOHN ANNDREW
SEARES, MARIA ROSARIO ISABEL
SIGUE, WINONA RICA
SUAZO, CHRISTIAN ZEUS
YLAGAN, TOM EMIL

LAYOUT:
BAYOMBONG, AXELE E.

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 FACULTY OF CIVIL LAW | POLITICAL LAW

POLITICAL LAW CASES

PEOPLE OF THE PHILIPPINES v. MICHAEL FRIAS y SARABIA 1

DEPARTMENT OF EDUCATION v. RIZAL TEACHERS KILUSANG BAYAN FOR CREDIT, INC. 3
FACT-FINDING INVESTIGATION BUREAU (FFIB)-OFFICE OF THE DEPUTY OMBUDSMAN
FOR THE MILITARY AND OTHER LAW ENFORCEMENT OFFICES v. RENATO P. MIRANDA 6
ESTRELLA M. DOMINGO v. CIVIL SERVICE COMMISSION AND VICTORINO MAPA MANALO
10
REPUBLIC OF THE PHILIPPINES v. SPOUSES LORENZANA JUAN DARLUCIO 13
LAND BANK OF THE PHILIPPINES v. MA. AURORA [RITA] DEL ROSARIO AND IRENE DEL
ROSARIO 16
PEOPLE OF THE PHILIPPINES v. LEAN NOEL DIZON 18
AMADO M. TETANGCO et al. v. COMMISSION ON AUDIT 20
GUBAT WATER DISTRICT (GWD), et al. v. COMMISSION ON AUDIT 25
LIGHT RAIL TRANSIT AUTHORITY v. QUEZON CITY, REPRESENTED BY THE CITY
TREASURER AND THE CITY ASSESSOR 29
FLORENCIO TUMBOCON MIRAFLORES and MA. LOURDES MARTIN MIRAFLORES v. OFFICE
OF THE OMBUDSMAN and FIELD INVESTIGATION OFFICE 31
ASSOCIATION OF INTERNATIONAL SHIPPING LINES, INC., APL CO. PTE LTD., AND
MAERSK-FILIPINAS, INC. v. SECRETARY OF FINANCE and COMMISSIONER OF INTERNAL
REVENUE 35
RADAMES F. HERRERA v. NOEL P. MAGO et al. 39
ROBERTO C. EUSEBIO v. CIVIL SERVICE COMMISSION 42
MUNICIPALITY OF BAKUN, BENGUET v. MUNICIPALITY OF SUGPON, ILOCOS SUR 45
PHILIPPINE HEART CENTER v. THE LOCAL GOVERNMENT OF QUEZON CITY, CITY MAYOR
OF QUEZON CITY, CITY TREASURER OF QUEZON CITY AND CITY ASSESSOR OF QUEZON
CITY 48
TAISEI SHIMIZU JOINT VENTURE v. COMMISSION ON AUDIT and the DEPARTMENT OF
TRANSPORTATION (formerly Department of Transportation and Communication) 51
FORFOM DEVELOPMENT CORPORATION v. PHILIPPINE NATIONAL RAILWAYS 56
PEOPLE OF THE PHILIPPINES v. THE HONORABLE FOURTH DIVISION, SANDIGANBAYAN
and RAUL Y. DESEMBRANA 58
ANGKLA: ANG PARTIDO NG MGA PILIPINONG MARINO, INC. (ANGKLA) and SERBISYO SA
BAYAN PARTY (SBP) v. COMMISSION ON ELECTIONS, et al. 62
PEOPLE OF THE PHILIPPINES v. SUNDARAM MAGAYON Y FRANCISCO 64

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT CORPORATION (PSALM) and THE
CONCERNED AND AFFECTED OFFICERS AND EMPLOYEES OF PSALM. v. COMMISSION ON
AUDIT 69
SOCIAL SECURITY SYSTEM v. COMMISSION ON AUDIT 74
TERESITA P. DE GUZMAN, et al. v. COMMISSION ON AUDIT 79
DEPARTMENT OF TRADE AND INDUSTRY AND ITS BUREAU OF PRODUCT STANDARDS v.
STEELASIA MANUFACTURING CORPORATION 82
DIOSDADO SAMA Y HINUPAS and BANDY MASANGLAY v. PEOPLE OF THE PHILIPPINES 87
NATIONAL POWER CORPORATION (NPC) v. SPOUSES RUFO AND TOMASA LLORIN,
REPRESENTED BY THEIR ATTORNEY-IN-FACT, CORAZON CANDELARIA 90
PEOPLE OF THE PHILIPPINES v. EDGAR MAJINGCAR YABUT and CHRISTOPHER RYAN
LLAGUNO y MATOS 92
SECURITIES AND EXCHANGE COMMISSION v. COMMISSION ON AUDIT 95
VICTOR M. BARROSO v. COMMISSION ON AUDIT 98
CATHAY PACIFIC STEEL CORPORATION v. COMMISSION ON AUDIT, NATIONAL POWER
CORPORATION AND POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT
CORPORATION 100
PEOPLE OF THE PHILIPPINES v. SPO1 ALEXANDER ESTABILLO Y PALARA 102
PHILIPPINE NATIONAL CONSTRUCTION CORPORATION v. NATIONAL LABOR RELATIONS
COMMISSION 104
IRENE S. ROSARIO v. COMMISSION ON AUDIT 106
BERNADETTE LOURDES B. ABEJO, EXECUTIVE DIRECTOR OF THE INTER-COUNTRY
ADOPTION BOARD (ICAB) v. COMMISSION ON AUDIT, REPRESENTED BY CHAIRPERSON
MICHAEL AGUINALDO 109
MUNICIPALITY OF TUPI, REPRESENTED BY ITS MUNICIPAL MAYOR REYNALDO S.
TAMAYO, JR. v. HERMININIO F. FAUSTINO 112
GLADYS MINERVA N. BILIBLI, DARROW P. ODSEY, AND ZENAIDA BRIGIDA H. PAWID v.
COMMISSION ON AUDIT 115
VICENTE J. CAMPA, JR. and PERFECTO M. PASCUA v. HON. EUGENE C. PARAS, PRESIDING
JUDGE, RTC, BR. 58, MAKATI CITY and PEOPLE OF THE PHILIPPINES 117
NOEL T. JASPE et al. v. PUBLIC ASSISTANCE AND CORRUPTION PREVENTION OFFICE AND
AGUSTIN SONZA, JR. 119
CIVIL SERVICE COMMISSION v. MARILOU T. RODRIGUEZ 122
LAND BANK OF THE PHILIPPINES v. MILAGROS DE JESUS-MACARAEG 124
SILVERIO REMOLANO v. PEOPLE OF THE PHILIPPINES 127
JAIME V. SERRANO v. FACT-FINDING INVESTIGATION BUREAU, OFFICE OF THE DEPUTY
OMBUDSMAN FOR THE MILITARY AND OTHER LAW ENFORCEMENT OFFICES 129

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VINES REALTY CORPORATION v. RODEL RET 133

HUMPHREY T. MONTEROSO v. SPECIAL PANEL NO. 13-01-IAB, REPRESENTED BY DONABEL
ATIENZA 137
CAGAYAN DE ORO CITY WATER DISTRICT, REPRESENTED BY ITS GENERAL MANAGER
ENGR. RACHEL M. BEJA v. HON. EMMANUEL P. PASAL, REGIONAL TRIAL COURT, BRANCH
38, CAGAYAN DE ORO CITY AND RIO VERDE WATER CONSORTIUM, INC. 140
FIELD INVESTIGATION OFFICE, OFFICE OF THE OMBUDSMAN v. ENRICO T. YUZON,
GODOFREDO DE GUZMAN, LUDIVINA BANZON, AND EMERLINDA TALENTO 143
POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT (PSALM) Corp. v. COMMISSION
ON AUDIT 147
VENUS COMMERCIAL CO., INC. v. THE DEPARTMENT OF HEALTH and THE FOOD AND
DRUG ADMINISTRATION 150
GM LORETO P. SEARES, JR. v. NATIONAL ELECTRIFICATION ADMINISTRATION BOARD
154
ANDREW N. BAYSA v. MARIETTA V. SANTOS 157
SPOUSES MARCELO G. FLORES and MEDELYN FLORES v. SPOUSES LEOPOLDO 159
ANGKLA: ANG PARTIDO NG MGA MARINONG PILIPINO, INC. (ANGKLA), 163
JOSEPH ROBLE PEÑAS v. COMMISSION ON ELECTIONS 169
BRYAN TA-ALA Y CONSTANTINO v. PEOPLE OF THE PHILIPPINES 173
NORMAN CORDERO MARQUEZ v. COMMISSION ON ELECTIONS 177
THE SENATE OF THE PHILIPPINES et al. v. THE EXECUTIVE SECRETARY SALVADOR C.
MEDIALDEA and SECRETARY OF HEALTH FRANCISCO T. DUQUE III 180
SPOUSES LOURDES V. RAFAEL and RAUL I. RAFAEL v. GOVERNMENT SERVICE INSURANCE
SYSTEM (GSIS) 184
GIORGIDI B. AGGABAO and AMELITA S. NAVARRO v. COMMISSION ON 188
DENNIS M. VILLA-IGNACIO v. WENDELL E. BARRERAS-SULIT 193
QUEZON CITY EYE CENTER v. PHILIPPINE HEALTH INSURANCE CORPORATION, et al. 198
POLICE OFFICER 2 ARTHUR M. PINEDA v. PEOPLE OF THE PHILIPPINES 200
ILOILO GRAIN COMPLEX CORPORATION v. MA. THERESA N. ENRIQUEZ-GASPAR, in her
capacity as Presiding Judge of RTC-Iloilo City, Branch 33, and NATIONAL GRID CORPORATION OF
THE PHILIPPINES 203
PROVINCE OF MAGUINDANAO DEL NORTE v. BUREAU OF LOCAL GOVERNMENT
FINANCE, REGIONAL OFFICE NO. XII, et al. 207
PEOPLE OF THE PHILIPPINES v. ADELBERTO FEDERICO YAP, et al. 209
PEOPLE OF THE PHILIPPINES v. ABDUL AZIS AND ALIBAIR MACADATO 214
AAA261422, a minor and represented by YYY261422 v. XXX261422 216

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PROVINCE OF MAGUINDANAO DEL NORTE v. BUREAU OF LOCAL GOVERNMENT

FINANCE, REGIONAL OFFICE NO. XII, et al. 218
ANTONIO ABIANG y CABONCE v. PEOPLE OF THE 221
VICENTE SUAREZ JR. Y BANUA v. PEOPLE OF THE PHILIPPINES 224
WALTER MANUEL F. PRESCOTT v. BUREAU OF IMMIGRATION, as represented by HON.
ROGELIO D. GEVERO, JR., and the DEPARTMENT OF JUSTICE 226

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PEOPLE OF THE PHILIPPINES v. MICHAEL FRIAS y SARABIA

G.R. No. 234686, 10 June 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

It is settled that prior surveillance is not a requisite to a valid entrapment or buy-bust operation. Flexibility is a trait of
good police work. For so long as the rights of the accused have not been violated in the process, the arresting officers may carry out
its entrapment operations and the courts will not pass on the wisdom thereof.

Hence, whether or not PDEA's prior surveillance on Frias was proper, the same will not affect the validity of the
subsequent entrapment operation in the absence of any showing that Frias' rights as accused were violated.

FACTS
Philippine Drug Enforcement Agency (PDEA) agent Von Rian Tecson received a report from a
confidential informant that Michael Frias (Frias) and his live-in partner Marichu Suson were selling shabu. The
authorities did surveillance and confirmed that persons were coming in and out of Frias' house in the area. A
buy-bust team was immediately formed with Agent Tecson as team leader, Agent Novemar Pinanonang as
poseur-buyer, Agent Theonette Solar as arresting officer, and the rest of the team as back up. They prepared
the buy-bust money of P500 bill.

The team proceeded to Frias’ house. The informant introduced Agent Pinanonang to Frias as a
potential buyer of shabu. Frias asked if they got the money and simultaneously handed Agent Pinanonang a
plastic sachet containing white crystalline substance. Agent Pinanonang, in turn, gave the buy-bust money to
Frias. Thereafter, Agent Pinanonang removed his baseball cap to signal the back-up team to close in. Agent
Pinanonang frisked Frias and recovered another plastic sachet containing shabu and the buy-bust money.

Agent Solar also frisked Suson and recovered from her a plastic sachet containing white crystalline
substance. The items were marked and inventoried at the place of arrest and in the presence of media
representatives and barangay officials.

Frias and Suson were brought to the police station where their arrest was entered in the blotter. Agent
Pinanonang took the plastic sachets to the PDEA safe house, prepared a request for their laboratory
examination, and delivered them to Forensic Chemist Paul Jerome Puentespina for laboratory examination.
Forensic Chemist Puentespina found the specimens positive for methamphetamine hydrochloride (shabu).

The Regional Trial Court (RTC) found Frias guilty of violation of Section 5, Article II and Section 11,
Article II of Republic Act No. 9165 (R.A. No. 9165) otherwise known as the Comprehensive Dangerous Drugs
Act of 2002.

The Court of Appeals (CA) affirmed the ruling of the RTC.

ISSUE
Was the prior surveillance conducted by the authorities improper?

RULING

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

NO. It is settled that prior surveillance is not a requisite to a valid entrapment or buy-bust operation.
Flexibility is a trait of good police work. For so long as the rights of the accused have not been violated in the
process, the arresting officers may carry out its entrapment operations and the courts will not pass on the
wisdom thereof. Hence, whether or not PDEA's prior surveillance on Frias was proper, the same will not affect
the validity of the subsequent entrapment operation in the absence of any showing that Frias' rights as accused
were violated.

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DEPARTMENT OF EDUCATION v. RIZAL TEACHERS KILUSANG BAYAN FOR CREDIT,

INC.
G.R. No. 202097, 03 July 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 7 of RA 9155 (Governance of Basic Education Act of 2001) sets forth the power, duties and functions of
DepEd and the different levels of supervision and regulation of educational activities. Notably, DepEd's activities as collection and
remittance agent for accredited private lending institutions are not among its core power, duties, and functions.

DepEd, nonetheless, has no legal duty to act as a collecting and remitting agent for RTKBCI. The latter has not shown
that it remains an accredited private lending institution entitled to avail of the payroll deduction system. Assuming that RTKBCI
is still DepEd accredited, DepEd is not precluded from suspending its activities under the payroll deduction scheme vis-à-vis a
private lending agency such as RTKBCI.

RTKBCI has no clear legal right to demand that DepEd act as its collecting and remitting agent. To reiterate, this is
not one of DepEd's power, duties, and functions. Rather, it is an accommodation that DepEd does x x x not for the benefit of any
private lending agency but as a means to protect and promote the teachers' welfare. Hence, the only feasible characterization of this
activity its being a mere privilege.

FACTS
For the benefit of public-school teachers, Department of Education (DepEd) devised and
implemented a payroll deduction scheme for the loans they secured from DepEd's duly accredited private
lenders. Rizal Teachers Kilusang Bayan for Credit, Inc.(RTKBCI) was among DepEd's accredited private
lenders which availed of the latter's payroll deduction scheme.

DepEd Undersecretary Ernesto S. Pangan (Pangan) directed Dr. Blanquita D. Bautista, Chief
Accountant and Officer-in-Charge of the Finance and Management Service to hold the remittance of the
collections for February to June 2001; and suspend as well the salary deduction scheme for RTKBCI pending
resolution of the teachers' numerous complaints against RTKBCI's alleged unauthorized excessive deductions
and connivance with some DepEd's personnel in charge of effecting these deductions.

Responding to Undersecretary Pangan's directive, RTKBCI wrote the former demanding the release
of the collections. Undersecretary Pangan denied the demand. Pangan asserted that the suspension of the salary
deduction scheme was necessary to protect the concerned public-school teachers.

RTKBCI filed with Regional Trial Court (RTC) of Manila the petition for mandamus to compel DepEd
and then Secretary Raul Roco and Undersecretary Pangan to remit to RTKBCI the loan collections and
continue with the salary deduction scheme until the loans of the public-school teachers should have been fully
paid. The trial court granted the writ of mandamus and ordered DepEd to release to RTKBCI the collections.

On DepEd's appeal, the Court of Appeals (CA), affirmed the decision of the RTC. The CA sustained
the alleged clear legal right of RTKBCI to receive the payments which DepEd had already collected through
the payroll deduction scheme. The CA acknowledged that the payroll deduction scheme started as a privilege
but became a property right of RTKBCI after DepEd authorized RTKBCI to avail of the scheme and actually
collected the payments for RTKBCI's account

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ISSUES
(1) Is DepEd compelled to collect, by salary deductions, the loan payments of public-school teachers and
remit them to the RTKBCI?
(2) Is DepEd estopped from denying clear legal duty for such to act as RTKBCI’s collection and
remittance agent?

RULING
(1) NO. Section 7 of RA 9155 (Governance of Basic Education Act of 2001) sets forth the power,
duties and functions of DepEd and the different levels of supervision and regulation of educational activities.
Notably, DepEd's activities as collection and remittance agent for accredited private lending institutions are not
among its core power, duties, and functions.

It is true that DepEd can no longer argue that it is powerless to institute a payroll deduction scheme
for accredited private lending institutions. DepEd, nonetheless, has no legal duty to act as a collecting and
remitting agent for RTKBCI. The latter has not shown that it remains an accredited private lending institution
entitled to avail of the payroll deduction system. Assuming that RTKBCI is still DepEd accredited, DepEd is
not precluded from suspending its activities under the payroll deduction scheme vis-à-vis a private lending
agency such as RTKBCI. The payroll deduction scheme expressly describes the services it offers as a privilege.
As such, DepEd may act as a collecting and remitting agent for a private lending agency, but doing so must
always be in consonance with DepEd's power, duties, and functions under Section 7 of RA 9155.

RTKBCI has no clear legal right to demand that DepEd act as its collecting and remitting agent. To
reiterate, this is not one of DepEd's power, duties, and functions. Rather, it is an accommodation that DepEd
does x x x not for the benefit of any private lending agency but as a means to protect and promote the teachers'
welfare. Hence, the only feasible characterization of this activity its being a mere privilege. To otherwise
characterize this activity is to demean and degrade the stature of DepEd as the sovereign regulator and
supervisor of basic education and to reduce it to being a mere collection and remittance agency for private
lending institutions.

(2) NO. As held in Peña v. Delos Santos, "estoppel is a principle in equity and pursuant to Article 1432,
Civil Code, it is adopted insofar as it is not in conflict with the provisions of the Civil Code and other laws."
Estoppel, thus, cannot supplant and contravene the provision of law clearly applicable to a case, and conversely,
it cannot give validity to an act that is prohibited by law or one that is against public policy.

DepEd cannot be held in estoppel to ascribe upon it a clear legal duty to act in situations where the
paramount consideration mandated DepEd to protect and promote of the teachers' welfare in accordance with
its power, duties, and functions under Section 7, RA 9155. It is both against law and public policy to uphold
the collection and remittance accommodation afforded to private lending institutions when to do so was and
would be prejudicial to its express mandate under RA 9155 to protect and promote the teachers' welfare.

In relation to the party sought to be estopped, these are: 1) a clear conduct amounting to false
representation or concealment of material facts or, at least, calculated to convey the impression that the facts
are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; 2) an intent
or, at least, an expectation, that this conduct shall influence, or be acted upon by, the other party; and 3) the

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knowledge, actual or constructive, by him of the real facts. With respect to the party claiming estoppel, the
conditions he or she must satisfy are: 1) lack of knowledge or of the means of knowledge of the truth as to the
facts in question; 2) reliance, in good faith, upon the conduct or statements of the party to be estopped; and 3)
action or inaction based thereon of such character as to change his position or status calculated to cause him
injury or prejudice.

It has not been shown that DepEd intended to conceal the actual facts concerning the nature of its
role as a collection and remittance agent of RTKBCI as a privilege and as an accommodation to the latter on
one hand, and a protective and promotive mechanism for the welfare of teachers, on the other. More important,
RTKBCI has been shown not to be totally unaware of the aforementioned nature of DepEd's role and its
primary responsibility to teachers, among other stakeholders, and only secondarily and subsidiarily to private
lending institutions such as RTKBCI.

Continued practice in domestic legal matters does not rise to the level of a legal obligation. The first
sentence of Article 7 of the Civil Code states, " [l]aws are repealed only by subsequent ones, and their violation
or nonobservance shall not be excused by disuse, or custom or practice to the contrary." There can be no clear
legal duty and clear legal right where to do so would compel DepEd to violate its power, duties, and functions
under Section 7 of RA 9155, specifically toward the protection and promotion of the teachers' welfare.

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FACT-FINDING INVESTIGATION BUREAU (FFIB)-OFFICE OF THE DEPUTY

OMBUDSMAN FOR THE MILITARY AND OTHER LAW ENFORCEMENT OFFICES v.
RENATO P. MIRANDA
G.R. No. 216574, 10 July 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In Office of the Ombudsman, et al. v. PS/Supt. Espina, the Court defined misconduct as wrongful, improper or unlawful
conduct motivated by a premeditated, obstinate or intentional purpose. It is intentional wrongdoing or deliberate violation of a rule
of law or standard of behavior. On the other hand, dishonesty, which is defined as the disposition to lie, cheat, deceive, or defraud;
untrustworthiness, lack of integrity," is classified in three (3) gradations, namely: serious, less serious, and simple.
Misconduct is a transgression of some established and definite rule of action, more particularly, unlawful behavior or gross
negligence by a public officer. As an administrative offense, misconduct should relate to or be connected with the performance of the
official functions and duties of a public officer. It is considered grave where the elements of corruption and clear intent to violate the
law or flagrant disregard of established rule are present.

Here, Miranda violated the rule that whoever holds custody of official funds in trust must bear the requisite authority.
Miranda was in charge of affirming the grant, release, and disbursement of millions of pesos in PMC funds. Miranda's culpability
for dishonesty, on the other hand, is rooted in his actions indicating his predisposition to lie for the purpose of defrauding the
government in huge amounts of public funds.

FACTS
The Philippine Marine Corps (PMC) earmarked and released PHP 36,768,028.95 as Combat Clothing
Allowance and Individual Equipment Allowance (CCIE) for its enlisted personnel for CY 1999. Each enlisted
employee was to get PHP 8,381.25 as Combat Clothing Allowance and P6,337.80 as Individual Equipment
Allowance, or a total of P14,719.05. The disbursements were released through nineteen (19) checks in various
amounts. PMC Commanding Officer and Deputized Disbursing Officer Major Felicisimo C. Millado and PMC
Commandant BGen. Percival M. Subala signed the checks payable to Deputized Disbursing Officer Major
Millado.

Acting on the records given by the Commission on Audit (COA), Fact-Finding Investigation Bureau
- Office of the Deputy Ombudsman for the Military and Other Law Enforcement Offices (FFIB-OMB-
MOLEO) investigated the subject disbursements. On basis thereof, FFIB-MOLEO charged MGen. Renato P.
Miranda (Miranda) and other marine officers with malversation of public funds through falsification of public
documents, violation of COA Rules and Regulations, and violation of Section3 (e) of Republic Act No. 3019
(R.A. No. 3019) or the Anti-Graft and Corrupt Practices Act.

The FFIB-OMB-MOLEO alleged that through "random sampling" of liquidation payrolls, COA
discovered that some PMC personnel did not receive the PHP 14,719.05 CCIE allowance supposedly intended
for them. These PMC personnel disowned the signatures appearing on the payrolls and even denied authorizing
any representative to receive these allowances on their behalf. As for Miranda, FFIB-OMB-MOLEO found
that he did not have the authority to approve the grant of the CCIE

The ODO-MOLEO found five marine officers, including Miranda, guilty of grave misconduct and
dishonesty. All of them were ordered dismissed from service.

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On petition for review before the Court of Appeals (CA), the CA reversed the decision of the ODO-
MOLEO. It found that no substantial evidence was presented showing that Miranda actively participated in
the alleged conspiracy to defraud the government.

In a petition before the Supreme Court, FFIB-OMB-MOLEO essentially argued that through a
document captioned Funds Entrusted to Agent Officer/Teller, Miranda authorized Maj. Adelo B. Jandayan (Maj.
Jandayan) to receive the P36,768,028.95 CCIE funds, albeit, the latter was not the duly authorized disbursement
officer

ISSUES
(1) Does conspiracy exist in this case?
(2) Should Miranda be held liable for grave misconduct and dishonesty?

RULING
(1) YES. There is existence of conspiracy. Bahilidad v. People defines conspiracy, in this wise, viz.:

There is conspiracy when two or more persons come to an agreement concerning the
commission of a felony and decide to commit it. Conspiracy is not presumed. Like the physical
acts constituting the crime itself, the elements of conspiracy must be proven beyond
reasonable doubt. While conspiracy need not be established by direct evidence, for it may be
inferred from the conduct of the accused before, during and after the commission of the
crime, all taken together, however, the evidence must be strong enough to show the
community of criminal design. For conspiracy to exist, it is essential that there must be a
conscious design to commit an offense.

To prove conspiracy, it is not always necessary that direct evidence be presented to establish its
existence. That the conspirators came to an agreement to pursue a common evil design may be inferred from
the overt acts of the conspirators themselves. The act of every conspirator must be shown to have been done
to contribute to the realization of a common unlawful goal. In Macapagal-Arroyo v. People, the Court ordained:

x x x In terms of proving its existence, conspiracy takes two forms. The first is the express
form, which requires proof of an actual agreement among all the co-conspirators to commit
the crime. However, conspiracies are not always shown to have been expressly agreed upon.
Thus, we have the second form, the implied conspiracy. An implied conspiracy exists when
two or more persons are shown to have aimed by their acts towards the accomplishment of
the same unlawful object, each doing a part so that their combined acts, though apparently
independent, were in fact connected and cooperative, indicating closeness of personal
association and a concurrence of sentiment. Implied conspiracy is proved through the mode
and manner of the commission of the offense, or from the acts of the accused before, during
and after the commission of the crime indubitably pointing to a joint purpose, a concert of
action and a community of interest. x x x

Miranda’s culpability did not arise solely because he signed the disbursement vouchers. His culpability
rather was hinged on his act of authorizing Maj. Jandayan to receive the CCIE funds, albeit, the latter did not
have the requisite authority to receive, much less, disburse these funds. Miranda cannot validly claim that signing

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the disbursement vouchers was part of his ministerial duty. Notably, what gave rise to his liability was his
entrusting a large amount of public funds to an officer who did not have the authority to receive, let alone,
disburse the funds. And as it turned out, the funds which Miranda entrusted to Maj. Jandayan were not
disbursed to their supposed beneficiaries.

It is indubitable that Maj. Jandayan came into the picture only when Miranda out of nowhere and
without any valid designation or authority possessed by Maj. Jandayan suddenly brought the latter in as recipient
and disburser of the funds. It was truly the final operative act which caused first the release, then the
misappropriation, and finally the total loss of the funds which to date, have remained unaccounted for. The
Court keenly notes that from day one up until now, Miranda has not produced the authority of Maj. Jandayan,
if any, to receive and disburse the funds in question.

(2) YES. Miranda is guilty of grave misconduct and serious dishonesty.

Office of the Ombudsman, et al. v. PS/Supt. Espina defines grave misconduct and serious dishonesty, in this
wise:

Misconduct generally means wrongful, improper or unlawful conduct motivated by a

premeditated, obstinate or intentional purpose. It is intentional wrongdoing or deliberate
violation of a rule of law or standard of behavior and to constitute an administrative offense,
the misconduct should relate to or be connected with the performance of the official functions
and duties of a public officer. It is a transgression of some established and definite rule of
action, more particularly, unlawful behavior or gross negligence by a public officer.
xxx

On the other hand, dishonesty, which is defined as the disposition to lie, cheat, deceive, or
defraud; untrustworthiness, lack of integrity," is classified in three (3) gradations, namely:
serious, less serious, and simple. Serious dishonesty comprises dishonest acts: (a) causing
serious damage and grave prejudice to the government; (b) directly involving property,
accountable forms or money for which respondent is directly accountable and the respondent
shows an intent to commit material gain, graft and corruption; (c ) exhibiting moral depravity
on the part of the respondent; (d) involving a Civil Service examination, irregularity or fake
Civil Service eligibility such as, but not limited to, impersonation, cheating and use of crib
sheets; (e) committed several times or in various occasions; (f) committed with grave abuse of
authority; (g) committed with fraud and/or falsification of official documents relating to
respondent's employment; and (h) other analogous circumstances.

Misconduct is a transgression of some established and definite rule of action, more particularly,
unlawful behavior or gross negligence by a public officer. As an administrative offense, misconduct should
relate to or be connected with the performance of the official functions and duties of a public officer. It is
considered grave where the elements of corruption and clear intent to violate the law or flagrant disregard of
established rule are present.

To repeat, Miranda violated the rule that whoever holds custody of official funds in trust must bear
the requisite authority. Miranda was in charge of affirming the grant, release, and disbursement of millions of

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pesos in PMC funds. It was upon his directive alone through the document captioned Funds Entrusted to Agent
Officer/Teller, that the funds were ordered released to Maj. Jandayan. Miranda cannot explain why he entrusted
the CCIE funds to Maj. Jandayan, albeit, the latter did not have the requisite authority to hold and disburse the
same for the PMC. In addition, Miranda knowingly, nay, unlawfully named Maj. Jandayan trustee of the funds
at least twelve (12) times in several millions of pesos. As it was, the intended beneficiaries did not receive the
funds. Verily, he is guilty of grave misconduct.

Miranda's culpability for dishonesty, on the other hand, is rooted in his actions indicating his
predisposition to lie for the purpose of defrauding the government in huge amounts of public funds. He
diverted the CCIE allowances of marine personnel, entrusting them to one not duly authorized to receive, let
alone, disburse the same to their supposed beneficiaries. As it turned out, the beneficiaries did not receive even
a single centavo of these public million funds. And it was Miranda's irresponsible, nay, unlawful action which
directly caused serious damage and prejudice to the government. For public funds were dissipated and lost
beyond recovery.

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

ESTRELLA M. DOMINGO v. CIVIL SERVICE COMMISSION AND VICTORINO MAPA

MANALO
G.R. No. 237063, 23 July 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Misconduct is “a transgression of some established and definite rule of action, more particularly, unlawful behavior or
gross negligence by a public officer.”

In Grave Misconduct, as distinguished from Simple Misconduct, the elements of corruption, clear intent to violate the law
or flagrant disregard of established rules, must be manifest and established by substantial evidence. Grave Misconduct necessarily
includes the lesser offense of Simple Misconduct. Thus, a person charged with Grave Misconduct may be held liable for Simple
Misconduct if the misconduct does not involve any of the elements to qualify the misconduct as grave.

Domingo’s actions, however, do not violate or transgress any rule of conduct. As observed, the NAP, including the CSC
and the Court of Appeals, did not mention the exact law or office rule that Domingo had violated.

FACTS
Estrella M. Domingo (Domingo) is the Chief Archivist of the Archive Preservation Division of the
National Archives of the Philippines (NAP). Mayor of Bacoor City, Strike B. Revilla (Mayor Revilla) requested
from the NAP three resource speakers for a three-day Basic Records Management Seminar Workshop and a
two-day Training on Paper Preservation.

In response, Executive Director Victorino Mapa Manalo (Director Manalo), confirmed to Josephine
F. Austria (Austria), then Chief of the NAP’s Training and Information Division, the availability of four
resource speakers including Domingo, but only for the said Workshop only. Subsequently, Manalo requested
Austria to revise the schedule of the attendance of the resource speakers on the basis of putting on hold all in-
house trainings until after April 1, 2014. However, the latter did not do the same, hence the request of Mayor
Revilla was left in limbo.

However, despite such occasion, and as per the request of Mayor Revilla, Domingo acceded and
became a resource speaker on the said Workshop which was held on April 28-29, 2014. As a result, Director
Manalo issued a show cause memorandum relative to the conduct of the unapproved seminar and unauthorized
use and dissemination of the NAP’s handouts. In her answer, Domingo admitted to acting as a resource person
without office approval. Also, she denied knowing for sure of the request’s history. She further averred that
her information about the prior request came from Austria who had informed her that a request in which she
was one of the proposed speakers was still pending approval by Director Manalo. Domingo stated that she had
to attend the seminar as a resource speaker as she was a resident of Bacoor City and since Bacoor City had
already prepared the seminar’s venue while awaiting the NAP’s approval. Lastly, she stated that she had attended
the seminar in her private capacity as she was on leave.

Despite the foregoing, Domingo and Austria were formally charged with serious dishonesty, grave
misconduct, and conduct prejudicial to the interest of public service. Before the NAP, Dimongo was found
guilty as charged and dismissed from the service. According to the NAP, Domingo’s act of attending the
seminar as a resource speaker without prior office approval and use of official training materials were clear

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derogation of office rules, which constitute grave misconduct. The NAP ruling was also affirmed by the Civil
Service Commission (CSC).

Before the Court of Appeals, Domingo contended that she had no personal knowledge about the
request history and the correspondence between the NAP and Mayor Revilla. She maintains that it was Austria
who was in direct communication with NAP and Director Manalo regarding the request. More so, she only
joined the said Workshop out of NAP’s customary practice of allowing her to conduct seminars without office
approval due to exigency of service. Thus, she was without malice nor evil intent when she filed her leave on
April 28-29, 2014, and proceeded without authorization. However, the CA affirmed the CSC’s decision. Hence,
the present petition before the Supreme Court.

ISSUE
Did Domingo commit grave misconduct in attending the Workshop as a resource speaker despite
not having any knowledge of the request history?

RULING
NO. Misconduct is “a transgression of some established and definite rule of action, more particularly,
unlawful behavior or gross negligence by a public officer.”

In Grave Misconduct, as distinguished from Simple Misconduct, the elements of corruption, clear
intent to violate the law or flagrant disregard of established rules, must be manifest and established by
substantial evidence. Grave Misconduct necessarily includes the lesser offense of Simple Misconduct. Thus, a
person charged with Grave Misconduct may be held liable for Simple Misconduct if the misconduct does not
involve any of the elements to qualify the misconduct as grave.

Here, it is undisputed that Domingo acted as resource speaker at the seminar organized by the City of
Bacoor for its Basic Records Management without office approval where the NAP materials were disseminated
for the purpose of conducting the seminar in general. It may also be reasonably inferred from the established
facts that Domingo coincided her leave of absence on April 28-29, 2014 so she could take part as a resource
speaker at the seminar, and along with Austria, kept respondent Director Manalo in the dark about their
attendance at this seminar.

Domingo’s actions, however, do not violate or transgress any rule of conduct. As observed, the NAP,
including the CSC and the Court of Appeals, did not mention the exact law or office rule that Domingo had
violated. The Supreme Court has inferred that the rule of conduct adverted to in the administrative proceedings
are, as stated, Executive Order No. (EO) 77, series of 2019, Prescribing Rules and Regulations and Rates of
Expenses and Allowances for Official Local and Foreign Travels of Government Personnel, and its
implementing NAP office procedures, as well as Section 176.137 of the Intellectual Property Code.

To be sure, EO 77, series of 2019, requires office approval only for local travels that are official in
nature, which refer to travels outside of the official station on official time. The NAP implementing procedures
simply aid in the enforcement of EO 77, and therefore, cannot require more than what EO 77 demands.

Here, Domingo opted not to avail of an official local travel. She decided instead to take a leave of
absence during the dates of the seminar. There is no allegation and proof that the NAP denied her leave of

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absence. Hence, when she attended the seminar at Tagaytay City, she was not on official time, had no right to
claim for official expenses, and cannot add the seminar to her credentials as an official work accomplishment.
Any risks, legal or physical, she could have faced were for her own look-out. Nonetheless, she was not barred
from attending this activity on her own personal volition and account as she was on leave of absence.

The Supreme Court takes judicial notice of the fact that local travels when done on personal account
do not require travel authority, unlike in the case of foreign travels whether personal or official. Local travels
in a government employee's personal capacity, as they involve absence from work and work station, only entail
the filing and approval of leave of absence. In the absence of any circumstance reflecting adversely upon the
government, whether in direct relation to and in connection with the performance of official duties amounting
either to maladministration or willful, intentional neglect and failure to discharge the duties of the office, or
though unrelated to the employee's official functions but tarnishes the image and integrity of the employee's
public office, a local travel is not actionable solely because there was no office order approving it.

The Court also cannot conclude that Domingo acted insubordinately to Director Manalo. It has not
been established that Domingo knew of the status of the first request made by the City of Bacoor. What has
only been confirmed is that she was told by Austria of the existence of the first request but not as to any update
about Director Manalo's action or inaction upon it.

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REPUBLIC OF THE PHILIPPINES v. SPOUSES LORENZANA JUAN DARLUCIO

AND COSME DARLUCIO
G.R. No. 227960, 24 July 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. The
measure is not the taker's gain, but the owner's loss. The word "just" is used to intensify the meaning of the word "compensation"
and to convey thereby the idea that the equivalent for the property to be taken shall be real, substantial, full, and ample. Section 5
of Republic Act No. 8974 (R.A. 8974) enumerates the following relevant standards the court may consider, among others, in the
determination of just compensation:

Section 5. Standards for the Assessment of the Value of the Land Subject of Expropriation
Proceedings or Negotiated Sale. — In order to facilitate the determination of just compensation, the court may
consider, among other well-established factors, the following relevant standards:
(a) The classification and use for which the property is suited; The developmental costs for
improving the land;
(b) The value declared by the owners;
(c) The current selling price of similar lands in the vicinity;
(d) The reasonable disturbance compensation for the removal and/or demolition of certain
improvement on the land and for the value of improvements thereon;
(e) [The] size, shape or location, tax declaration and zonal valuation of the land;
(f) The price of the land as manifested in the ocular findings, oral as well as documentary
evidence presented; and
(g) Such facts and events as to enable the affected property owners to have sufficient funds to
acquire similarly-situated lands of approximate areas as those required from them by the
government, and thereby rehabilitate themselves as early as possible.

Here, the challenge of the Republic against the so-called "just compensation" devoid of factual and legal bases must fail.
The Republic's persistent plea for a remarkably reduced amount of just compensation here should give way to what is fair and just.

FACTS
The Republic of the Philippines (Republic), represented by the Department of Public Works and
Highways (DPWH), filed a complaint for expropriation of a parcel of land situated in Barangay Ugong,
Valenzuela City, measuring five hundred twenty-seven (527) square meters (sq.m). The Republic sought to
expropriate the land for the construction of its C-5 Northern Link Road Project. The Republic alleged that said
land was unoccupied and did not bear any improvements. The owner/s of the land could not be ascertained or
located despite diligent effort. The current zonal valuation of the land was PHP 3,450.00 per sq.m. and the
Republic sought to expropriate four hundred thirteen (413) sq.m. of the land.

The Regional Trial Court (RTC) issued an order of expropriation and directed the Republic to deposit
with the Office of the Clerk of Court (OCC) the amount equivalent to one hundred percent (100%) of the
zonal valuation of the land, and which the Republic complied with. Subsequently, Spouses Lorenzana Juan
Darlucio and Cosme Darlucio (Sps. Darlucio) were named as owner-defendants.

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

Sps. Darlucio acceded to the expropriation of the land and admitted that the zonal value of the land
was PHP 3,450.00 per sq.m., albeit they demanded that the amount of just compensation be based on the
prevailing market value of the similarly situated properties. Given such, the RTC constituted the Board of
Commissioners (Board) to ascertain the amount of just compensation. Based on the parties’ respective evidence
and research about the land’s, the Board recommended the amount of PHP 15,000.00 per sq.m. as just
compensation on the land. Furthermore, they based the amount on the Hobart case wherein expropriated
properties situated within the Hobart Village were prized at PHP 15,000.00 per sq.m. These properties lie right
in front of Sps. Darlucio’s property.

The Regional Trial Court (RTC) fixed the amount of just compensation at PHP 15,000 per sq.m. and
directed the Republic to perform its corresponding obligation pertaining to the property.

The Court of Appeals (CA) affirmed with modification the RTC’s ruling. It also opined that the final
judicial determination of just compensation on the property in Hobart, i.e., PHP 15,000.00 per sq.m. is material
to the determination of the amount of just compensation in this case.

The Republic asserts that Hobart should not be considered the veritable factor in determining the
amount of just compensation here. Other equally important factors include the nature and character of the
land, the presence of informal settlers in the adjacent areas, and the zonal valuation of the land. Moreover, at a
prior date, it was able to expropriate 80.50 sq.m. of the land at only PHP 2,000.00 per sq.m.

ISSUE
Did the CA commit reversible error in affirming the amount of PHP 15,000.00 per square meter as
just compensation for the property?

RULING
NO. The CA committed no reversible error. Just compensation is defined as the full and fair equivalent
of the property taken from its owner by the expropriator. The measure is not the taker's gain, but the owner's
loss. The word "just" is used to intensify the meaning of the word "compensation" and to convey thereby the
idea that the equivalent for the property to be taken shall be real, substantial, full, and ample.

Section 5 of Republic Act No. 8974 (R.A. 8974) enumerates the following relevant standards the court
may consider, among others, in the determination of just compensation:

Section 5. Standards for the Assessment of the Value of the Land Subject of Expropriation
Proceedings or Negotiated Sale. — In order to facilitate the determination of just compensation,
the court may consider, among other well-established factors, the following relevant standards:
(h) The classification and use for which the property is suited; The
developmental costs for improving the land;
(i) The value declared by the owners;
(j) The current selling price of similar lands in the vicinity;
(k) The reasonable disturbance compensation for the removal and/or
demolition of certain improvement on the land and for the value of
improvements thereon;
(l) [The] size, shape or location, tax declaration and zonal valuation of the land;

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(m) The price of the land as manifested in the ocular findings, oral as well as
documentary evidence presented; and
(n) Such facts and events as to enable the affected property owners to have
sufficient funds to acquire similarly-situated lands of approximate areas as
those required from them by the government, and thereby rehabilitate
themselves as early as possible.

Did the RTC consider these relevant standards in its determination of the just compensation in the
case? The decision speaks for itself. Land capabilities, use, shape, flat terrain, classification as residential
property, surroundings, improvements, adjacent properties, final decision in similar expropriation cases of
adjacent properties, proof of informal settlers, if any, in adjacent areas are the relevant standards considered by
the RTC in determining the amount of just compensation for the property. In fact, the CA aptly took notice of
the meticulous process by which the RTC determined the amount of just compensation here.

In sum, the challenge of the Republic against the so-called "just compensation" devoid of factual and
legal bases must fail. In any event, the Republic's persistent plea for a remarkably reduced amount of just
compensation here should give way to what is fair and just.

One. The amount of P2,000.00 per sq.m. way back circa 1997 is no longer just or fair ten (10) years
after in 2007 when the expropriation complaint was filed. It is settled that just compensation refers to the value
of the property at the time of taking not earlier nor later.

Two. The zonal value alone of the properties in the area whether of recent or vintage years does not
equate to just compensation. Otherwise, its determination will cease to be judicial in nature. All the court has
to do is adopt the zonal value of the property in its decision, a purely mechanical act which totally negates the
exercise of judicial discretion.

Three. Continuous resistance against the application of Hobart here is uncalled for. Indeed, Hobart is
the binding final and executory precedent on how much is deemed to be just compensation for the property in
question.

Four. The Republic failed to prove the alleged presence of informal settlers in the property or its
immediate vicinity. Its own witness, Fe Pesebre, Officer-in-Charge in the Institutional Development Division
of the National Housing Authority, testified that she had no information whether informal settlers were found
on Sps. Darlucio's property.

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

LAND BANK OF THE PHILIPPINES v. MA. AURORA [RITA] DEL ROSARIO AND IRENE
DEL ROSARIO
G.R. No. 210105, 2 September 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Just compensation is the full and fair equivalent of the property taken from its owner by the expropriator. The measure
is not the taker's gain, but the owner's loss. The word "just" is used to intensify the meaning of the word "compensation" and to
convey thereby the idea that the equivalent to be rendered for the property to be taken shall be real, substantial, full, and ample. In
computing the just compensation, the trial courts take into consideration the value of the land "at the time of the taking" or when
the landowner was deprived of the use and benefit of his or her property, such as when title is transferred to the Republic.

Here, R.A. No. 6657, prior to its amendment by R.A. No. 9700, governs the present case. The provision is clear: any
new valuation method introduced by the DAR pursuant to R.A. No. 9700 cannot be given retroactive effect as to cover agricultural
properties taken prior to the enactment of said law. In determining just compensation, courts are duty bound to apply both the
compensation valuation factors enumerated under Section 17 of R.A. No. 6657 and the applicable basic formula.

FACTS
Ma. Aurora and Irene del Rosario were the owners of a 39.1248-hectare agricultural land in Barangay
Oma-oma, Ligao City, Albay. A team composed of representatives from various government conducted an
ocular inspection of the property. In their Field Investigation Report, the team recommended that 36.3168
hectares of the property be placed under the Comprehensive Agrarian Reform Program (CARP) pursuant to
Republic Act No. 6657 (R.A. No. 6657).

The Land Bank received the pertinent Claim Folder from DAR. The Land Bank then appraised the
property at PHP 34,994.36 per hectare based on the prescribed formula under DAR Administrative Order
(DAR AO) No. 5, s. of 1998. This valuation, however, was only applied to the 33.5017-hectare portion since
the 2.8151-hectare area pertained to a non-compensable legal easement. The DAR offered PHP 1,172,369.21
as just compensation for the property, but respondents rejected it.

This prompted the Provincial Agrarian Reform Adjudicator (PARAD) - Albay to initiate summary
administrative proceedings to determine the amount of just compensation for the property. Meanwhile,
respondents were paid the PHP 1,172,369.21 provisional valuation. Thereafter, the Register of Deeds of Albay
issued TCT No. T-126930 in the name of the Republic.

Under its decision, the PARAD fixed just compensation at PHP 6,766,000.00 or about PHP 201,959.90
per hectare, excluding the legal easement. It denied the Land bank motion for reconsideration.

While the case was pending, the Congress enacted Republic Act No. 9700 (R.A. No. 9700), otherwise
known as the CARPER Law, amending R.A. No. 6657. Among the amendments were the inclusion of two (2)
additional factors in determining just compensation: (i) the value of the standing crop and (ii) seventy percent
(70%) of the zonal valuation of the Bureau of Internal Revenue (BIR). To implement R.A. No. 9700, DAR
promulgated DAR AO No. 2, s. 2009 and No. 1, s. of 2010.

This led Land Bank to file in the Regional Trial Court (RTC) sitting as Special Agrarian Court. The
RTC rendering the entire 36.3168-hectare area compensable; second, reckoned the time of taking as of June

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30, 2009 when R.A. No. 9700 was enacted while Land Bank reckoned the time of taking as of August 2001;
and finally, applied the prescribed formula under DAR AO No. 2, s. 2009 and No. 1, s. of 2010, and not the
formula prescribed under DAR AO No. 5, s. of 1998.

Upon appeal by the Land bank, the Court of Appeals (CA) partly granted the appeal of Land Bank.
The Court of Appeals found that the trial court erred in adopting June 30, 2009, as the time of taking. As borne
by records, it is noted that the property was placed under the coverage of CARP in 2001. Thus, DAR AO No.
5, s. of 1998 should govern the computation of just compensation here.

ISSUE
Is DAR AO No. 5, s. of 1998 applicable in the determination of just compensation?

RULING
YES. Just compensation is the full and fair equivalent of the property taken from its owner by the
expropriator. The measure is not the taker's gain, but the owner's loss. The word "just" is used to intensify the
meaning of the word "compensation" and to convey thereby the idea that the equivalent to be rendered for the
property to be taken shall be real, substantial, full, and ample. In computing the just compensation, the trial
courts take into consideration the value of the land "at the time of the taking" or when the landowner was
deprived of the use and benefit of his or her property, such as when title is transferred to the Republic.

Here, the Court of Appeals correctly reckoned the time of taking as of 2001. Indeed, records bear
that: (i) the notice of coverage for the property was sent to respondents on February 20, 2001; (ii) petitioner
received the Claim Folder from the DAR on October 5, 2001; and (iii) TCT No. T-126930 was issued under
the name of the Republic on November 26, 2001. This Court considers the date of transfer of the property to
the name of the Republic on November 26, 2001 as the time of taking.

R.A. No. 6657, prior to its amendment by R.A. No. 9700, governs the present case. The provision is
clear: any new valuation method introduced by the DAR pursuant to R.A. No. 9700 cannot be given retroactive
effect as to cover agricultural properties taken prior to the enactment of said law. In determining just
compensation, courts are duty bound to apply both the compensation valuation factors enumerated under
Section 17 of R.A. No. 6657 and the applicable basic formula.

DAR AO No. 5, s. of 1998 was still in force at the time of taking in this case. The formula embodied
therein for fixing just compensation should, therefore, be applied.

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

PEOPLE OF THE PHILIPPINES v. LEAN NOEL DIZON

G.R. No. 223562, 04 September 2019, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

A waiver is voluntary and intelligent, the Constitution, requires that for the right to counsel to be waived, the waiver
must be in writing and in the presence of the counsel of the accused. There is no such written waiver in this case, much less was any
waiver made in the presence of the counsel since there was no counsel at the time appellant signed the receipt.

In this case, appellant affixed her signature in the inventory receipt without the assistance of counsel which is a violation
of her right under the Constitution. Appellant was not apprised of his right to counsel nor his right not to sign at all the certificate
of inventory of the seized items. Neither was he shown that to have waived his right to counsel in writing.

FACTS
Task Force Kasaligan (TFK) of Negros Oriental received information about the nefarious activities of
a certain Dizon. According to TFK's informant, Lean Dizon (Dizon) was expected to sell illegal drugs during
the forthcoming town fiesta. A buy bust team was formed. NBI Special Agent Miguel Dungog (Agent Dungog)
was designated as team leader, Philippine Drug Enforcement Agency (PDEA) Special Investigator 1 Claire
Oledan (Agent Oledan) as poseur-buyer and other police officers as immediate back up.

Agent Oledan and the informant went to Dizon’s residence. Agent Oledan positioned herself outside
the gate of the residence of Dizon while the informant went inside. After a while, Agent Oledan saw the
informant and Dizon coming out from the house. Dizon walked up to her and asked for the payment. Agent
Oledan immediately handed the marked P500.00 bill to Dizon. Afterwards, Dizon readily handed her the sachet
she chose, Agent Oledan slid it in her pocket and signified that the sale was consummated.

The team immediately closed in and pursued Dizon who ran toward his house. Dizon eventually got
arrested. Agent Oledan recovered another sachet of shabu from Dizon. PO3 Magsayo also frisked him and
retrieved from his pocket the marked P500 bill and two (2) other P500 bills.

PO3 Pedeglorio marked the seized items in the makeshift nipa hut right outside Dizon's house. The
marking and partial inventory were done in the presence of Dizon, two (2) Barangay Dos officials namely:
Kagawad Reynaldo Sumagaysay and Santiago Saberon, Jr., and Department of Justice (DOJ) representative
Nicanor Ernesto Tagle. Agent Amatong took photographs of the seized items during the inventory.

Meantime, PO3 Pedeglorio resumed the inventory at the NBI Office and asked media representative
Neil Rio to sign it. PO3 Pedeglorio further prepared the request for the laboratory examination of the seized
items. Agent Oledan signed for the requesting party.

The forensic chemist confirmed that the substance is both positive for methamphetamine
hydrochloride (shabu), a dangerous drug.

The Regional Trial Court (RTC) rendered Dizon guilty as charged.

The Court of Appeals (CA) affirmed the decision of the RTC. Prosecution had adequately and
satisfactorily proved the elements of illegal sale of shabu and illegal possession of shabu.

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ISSUES
(1) Was there a valid warrantless arrest?
(2) Was there a waiver of the right to counsel?

RULING
(1) YES. Appellant was caught in flagrante delicto selling shabu during a buy bust operation. People v.
Rivera reiterated the rule that warrantless arrest made during an entrapment operation including the search done
incidental thereto was valid pursuant to Section 5(a) of Rule 113 of the Rules on Criminal Procedure.

A buy-bust operation is a form of entrapment which in recent years has been accepted as a valid and
effective mode of apprehending drug pushers. In a buy-bust operation, the idea to commit a crime originates
from the offender, without anyone inducing or prodding him to commit the offense. If carried out with due
regard for constitutional and legal safeguards, a buy-bust operation deserves judicial sanction.] So must it be.

(2) NO. To insure that a waiver is voluntary and intelligent, the Constitution, requires that for the right
to counsel to be waived, the waiver must be in writing and in the presence of the counsel of the accused. There
is no such written waiver in this case, much less was any waiver made in the presence of the counsel since there
was no counsel at the time appellant signed the receipt.

Clearly, appellant affixed her signature in the inventory receipt without the assistance of counsel which
is a violation of her right under the Constitution. Here, appellant was not apprised of his right to counsel nor
his right not to sign at all the certificate of inventory of the seized items. Neither was he shown that to have
waived his right to counsel in writing.

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AMADO M. TETANGCO et al. v. COMMISSION ON AUDIT

G.R. No. 244806, 17 September 2019, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The PICCI is not an originally chartered corporation, but a subsidiary corporation of BSP organized in accordance with
the Corporation Code of the Philippines. The Articles of Incorporation of PICCI was registered on July 29, 1976 in the Securities
and Exchange Commission. As such, PICCI does not fall within the coverage of NCC No. 67. As a matter of fact, by virtue of
P.D. [No.] 520, PICCI is exempt from the coverage of the civil service law and regulations. Certainly, if PICCI is not part of
the National Government, but a mere subsidiary of a government-owned and/or controlled corporation (BSP), its officers, and
more importantly, its directors, are not covered by the term "national government officials and employees" to which NCC No. 67
finds application.

Verily, a corporation is a government-owned or controlled corporation when the government directly

or indirectly owns or controls at least a majority or 51% share of the capital stock. A government-owned or
controlled corporation is either a "parent" corporation, i.e., one "created by special law" (Sec. 3 (a), PD 2029)
or a "subsidiary" corporation, i.e., one created pursuant to law where at least a majority of the outstanding
voting capital stock is owned by the parent government corporation and/or other government-owned
subsidiaries.

Unquestionably, PICCI is a GOCC. Perforce, it is subject to the review and/audit of the COA.

FACTS
Amando Tetangco, Jr., Armando Suratos, Juan Zuniga, Jr., Antonio Bernardo, Jr. Victoria Berciles,
Teresa Mangila, and Ma. Cecilia Martin (Amando Tetangco, Jr. et al.) were members of the Philippine
International Convention Center, Inc. (PICCI) Board of Directors (BOD). During Tetangco et al.’s term, the
BOD approved several resolutions which increased the members’ per diem amounts. Meanwhile, during the
pendency of their term, the Court, in Singson, et al v. Commission on Audit (COA), held that the grant of per
diems and Representation and Transportation Allowance (RATA) did not violate the constitutional
proscription against double compensation.

However, Auditors Lolita Valenzuela (Auditor Valenzuela) and Ma. Teresa Gojunco (Auditor
Gojunco) issued a Notice of Disallowance (ND) against PICCI’s grant of per diems, RATA, and bonuses to
the BOD . On appeal to the Commission on Audit – Corporate Government Sector (COA-CGS), Tetangco et
al argued that the benefits did not constitute double compensation. The COA-CGS denied the appeal of
Tetangco et al.

Undaunted, Tetangco et al. further sought recourse before the COA proper. The COA modified the
ruling insofar as Singson, et al. v. COA allowed the grant of per diems in amounts not exceeding Php 1,000.00.
Thus, COA still held Tetangco et al. liable for the remainder of the per diems and other bonuses granted.

Hence, the recourse before the Court.

ISSUES
(1) Is PICCI a government owned and controlled corporation (GOCC), hence subject to the audit
jurisdiction of COA?

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(2) Was there double compensation?

(3) Was the grant of other bonuses in addition to the per diems valid?
(4) Was the increase in per diems and RATA valid?

RULING
(1) YES. The PICCI was incorporated pursuant to P.D. No. 520, which provides:

Section 2. In order for the International Conference Center to enjoy autonomy of

operation, separate and distinct from that of the Central bank, the latter is hereby authorized
to organize a corporation to be known as the Manila International Conference Center which
will manage and operate the former, the capital of which shall be fully subscribed by the
Central Bank.

The governing powers and authority of the corporation shall be vested in, and
exercised by, a Board of Directors composed of the Central Bank Governor as Chairman, the
Senior Deputy as Vice Chairman, and five other members to be designated by the Monetary
Board.

xxx xxx xxx

PICCI's sole stockholder is the BSP. The Administrative Code of 1987 defines a
GOCC in this wise:

(13) government-owned or controlled corporations refer to any agency organized as

a stock or non-stock corporation vested with functions relating to public needs whether
governmental or proprietary in nature, and owned by the government directly or indirectly
through its instrumentalities either wholly, or where applicable as in the case of stock
corporations to the extent of at least 51% of its capital stock.

Verily, a corporation is a government-owned or controlled corporation when the government directly

or indirectly owns or controls at least a majority or 51% share of the capital stock. A government-owned or
controlled corporation is either a "parent" corporation, i.e., one "created by special law" (Sec. 3 (a), PD 2029)
or a "subsidiary" corporation, i.e., one created pursuant to law where at least a majority of the outstanding
voting capital stock is owned by the parent government corporation and/or other government-owned
subsidiaries.

The COA's audit jurisdiction extends not only to government agencies or instrumentalities, but also to
"government-owned and controlled corporations with original charters as well as other government-owned or
controlled corporations" without original charters.

The personality of PICCI as a GOCC subsidiary of BSP has already been settled in Singson, viz:

The PICCI is not an originally chartered corporation, but a subsidiary corporation of

BSP organized in accordance with the Corporation Code of the Philippines. The
Articles of Incorporation of PICCI was registered on July 29, 1976 in the Securities

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and Exchange Commission. As such, PICCI does not fall within the coverage of NCC
No. 67. As a matter of fact, by virtue of P.D. [No.] 520, PICCI is exempt from the
coverage of the civil service law and regulations (and Constitution defining coverage
of civil service as limited to those with original [charter] (TUCP v. NHA, G.R. No.
49677, May 4, 1989, Article IX-B, Sec. 1). Certainly, if PICCI is not part of the
National Government, but a mere subsidiary of a government-owned and/or
controlled corporation (BSP), its officers, and more importantly, its directors, are not
covered by the term "national government officials and employees" to which NCC
No. 67 finds application.

Unquestionably, PICCI is a GOCC. Perforce, it is subject to the review and/audit of the COA.

(2) NO. Singson ordains that the grant of per diems and RATA to BSP officials concurrently holding
ex officio positions in PICCI does not violate the constitutional proscription against double compensation.

To recall, the COA here allowed petitioners' receipt of per diems but not exceeding P1,000.00. It,
nonetheless, affirmed the total disallowance of the RATA granted them, viz:

Thus, although the grant of per diems finds legal basis in Section 30 of the Corporation Code
of the Philippines, only the amount of P1,000.00 for every meeting shall be allowed pursuant
to the ruling of the Supreme Court in the Singson case, and pursuant to the suspension of the
grant of new increased benefit under MO No. 20.

As to the payment of Representation Allowance and Travel Allowance (RATA), this

Commission finds that its grant does not violate the provision against double compensation
under Section 8, Article IX-B of the 1987 Constitution,
xxx xxx xxx
However, as pointed out in the above-cited case, although there is no double compensation,
the By-Laws of PICCI authorized only the payment of per diem to the members of its Board
of Directors, and no other compensation. Thus, the payment of representation allowances and
bonuses is still in violation of Section 8, IX-B of the 1987 Constitution, as there is no law
authorizing its payment.

Singson pointedly resolved as valid the grant of RATA to members of the PICCI Board of
Directors who are also BSP officers, viz:
xxx xxx xxx
Taking NCC No. 67 as a whole then, what it seeks to prevent is the dual collection of
RATA by a national official from the budgets of "more than one national agency." We
emphasize that the other source referred to in the prohibition is another national agency. This
can be gleaned from the fact that the sentence "no one shall be allowed to collect RATA from
more than one source" (the controversial prohibition) immediately follows the sentence that
RATA shall be paid from the budget of the national agency where the concerned national
officials and employees draw their salaries. The fact that the other source is another national
agency is supported by RA 7645 (the GAA of 1993) invoked by respondent COA itself and,
in fact, by all subsequent GAAs for that matter, because the GAAs all essentially provide that

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(1) the RATA of national officials shall be payable from the budgets of their respective national
agencies and (2) those officials on detail with other national agencies shall be paid their RATA
only from the budget of their parent national agency:

Clearly therefore, the prohibition in NCC No. 67 is only against the dual or multiple collection of
RATA by a national official from the budgets of two or more national agencies. Stated otherwise, when a
national official is on detail with another national agency, he should get his RATA only from his parent national
agency and not from the other national agency he is detailed to.

Applying Singson here, we rule that like the grant of per diems, the payment of RATA to petitioners
Tentangco, Suratos and De Zuñiga does not violate the constitutional proscription against double
compensation.

In any event, the COA contradicted itself when in one breadth, it acknowledged the application of
Singson to this case, but in another, it disallowed the grant of RATA to aforenamed petitioners for supposed
lack of valid authority. In truth, Singson is one such valid authority supporting the grant of RATA to petitioners.
The other sources of such authority are MB Resolution No. 34 dated January 12, 1994, No. 665 dated July 3,
1996, No. 1919 dated October 31, 2000, No. 1518 dated December 7, 2006, No. 1901 dated December 29,
2009, and No. 1855 dated December 23, 2010. These resolutions were passed by the PICCI Board of Directors
and approved no less by the BSP-MB pursuant to Section 30 Corporation Code, viz:

Sec. 30. Compensation of Directors, - In the absence of any provision in the by-laws fixing
their compensation, the directors shall not receive any compensation, as such directors, except
for reasonable per diems; Provided, however, that any such compensation (other than per
diems) may be granted to directors by the vote of the stockholders representing at least a
majority of the outstanding capital stock at a regular or special stockholders' meeting. In no
case shall the total yearly compensation of directors, as such directors, exceed ten (10%)
percent of the net income before income tax of the corporation during the preceding year.

(3) NO. By definition, "bonus" is a gratuity or act of liberality of the giver. It is something given in
addition to what is ordinarily received by or strictly due the recipient. It is granted and paid to an employee for
his industry and loyalty which contributed to the success of the employer's business and made possible the
realization of profits.34 It is not a gift, but a sum paid for services, or upon some other consideration, but in
addition to or in excess of that which would ordinarily be given.35

Verily, bonus is a form of compensation for services rendered: the very evil sought to be curbed under
Section 8, Art. IX-B of the 1987 Constitution, viz:

Section 8. No elective or appointive public officer or employee shall receive additional, double,
or indirect compensation, unless specifically authorized by law, nor accept without the consent
of the Congress, any present, emolument, office, or title of any kind from any foreign
government. Pensions or gratuities shall not be considered as additional, double, or indirect
compensation.

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As a GOCC, the PICCI is governed by compensation and position standards issued by the Department
of Budget and Management (DBM) and relevant laws. Among them is Memorandum Order No. 2037 directing
the suspension of any increases on the benefits of GOCC employees and executives, thus:

SECTION 1. Immediately suspend the grant of any salary increases and new or increased
benefits such as, but not limited to, allowances; incentives; reimbursement of expenses;
intelligence, confidential or discretionary funds; extraordinary expenses, and such other
benefits not in accordance with those granted under SSL. This suspension shall cover senior
officer level positions, including Members of the Board of Directors or Trustees.
In fine, the proscribed increases under Memorandum Order No. 20 refer only to those in excess of
the benefits given to government officials holding comparable positions in the National Government. On this
score, the amounts of RATA and per diems granted to officials of the National Government for 2010 were those
specified under R.A. No. 9770 or the General Appropriations Act of 2010, viz:

Sec. 47. Representation and Transportation Allowances. The following officials of National
Government Agencies, whil in the actual performance of their respective functions, are hereby
authorized monthly commutable representation and transportation allowances payable from the
programmed appropriations provided for their respective offices at rates indicated below, which shall
apply to each type of allowance at:

(a) P11,000 for Department Secretaries;

(b) P8,700 for Department Undersecretaries;

(c) P7,800 for Department Assistant Secretaries;

(d) P7,000 for Bureau Directors and Department Regional Directors;

(e) P6,500 for Assistant Bureau Directors, Department Assistant Regional Directors Bureau Regional
Directors, and Department Service Chiefs;

(f) P5,500 for Assistant Bureau Regional Directors; and

(g) P4,000 for Chief of Divisions, identified as such in the Personal Services Itemization and Plantilla
of Personnel.

The determination of those that are of equivalent ranks with the above cited officials in the government
shall be made by the DBM.

xxx xxx xxx

Sec. 49. Honoraria. The respective agency appropriations for honoraria shall only be paid to the
following:

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(a) Teaching personnel of the DepEd, TESDA, SUCs and other educational institutions, engaged in
actual classroom teaching, whose teaching load is outside of the regular office hours or in excess of
the regular load;

(b) Those who act as lecturers, resource persons, coordinators and facilitators in seminars, training
programs, and other similar activities in training institutions, including those conducted by entities for
their officials and employees wherein no seminar fees are collected from participants;

(c) Chairs and members of commissions, boards, councils, and other similar entities, including the
personnel thereof who are not paid salaries nor per diems but compensated in the form of honoraria
as provided by law, rules and regulations;

The grant of honoraria to the foregoing shall be subject to the guidelines prescribed under Budget
Circular No. 2003-5, as amended by Budget Circular No. 2007-1 and National Budget Circular No.
2007-510, Budget Circular No. 2007-2, and other guidelines issued by the DBM.

Here, the COA disapproved the grant of per diems and RATA increases to its ex officio members,
without at all considering the foregoing guidelines. As it was, the COA issued a bulk disallowance of the
increases, sans any determination whether the same were indeed in excess of the amounts received by
petitioners' counterparts in the National Government. Surely, Memorandum Order No. 20 intends to
rationalize the benefits of the government employees, not to discriminate GOCCs.

GUBAT WATER DISTRICT (GWD), et al. v. COMMISSION ON AUDIT

G.R. No. 222054, 01 October 2019, EN BANC, (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

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It is provided that as a general rule, all allowances are deemed included in the standardized salary prescribed therein.
However, Section 12 of R.A. No. 6758 enumerated specific non-integrated benefits, namely:
(a) Representation and Transportation Allowance (RATA);
(b) Clothing and laundry allowances;
(c) Subsistence allowance of marine officers and crew on board government vessels and hospital personnel;
(d) Hazard pay;
(e) Allowances of foreign service personnel stationed abroad; and
(f) Such other additional compensation not otherwise specified herein as may be determined by the DBM (DBM)

In addition to the non-integrated allowances specified in Section 12, the DBM is delegated the authority to identify other
allowances that may be given to government employees in addition to the standardized salary.

Action by the DBM is not required to implement Section 12 integrating allowances into the standardized salary. Rather,
an issuance by the DBM is required only if additional non-integrated allowances will be identified.

FACTS
Gubat Water District (GWD) is a government entity organized and existing under Presidential Decree
No. 198 (PD 198), otherwise known as the provincial Water Utilities Act of 1973.

On August 31, 1979, Letter of Implementation No. 97 (LOI) was issued directing additional financial
incentives to be paid to government officers and employees including those in government owned or controlled
corporations (GOCCs). These additional incentives included the Cost of Living Allowance (COLA).

On July 1, 1989, Republic Act No. 6758 (RA 6758), otherwise known as the Compensation and Position
Classification Act of 1989, mandated that allowances and additional compensations received by government
officers and employees, including those working in GOCCs and government financial institutions (GFIs) be
consolidated into the standardized salary rates provided in the law. Excepted therefrom were representation
and transportation allowances; clothing and laundry allowances; subsistence allowance of marine officers and
crew on board government vessels and hospital personnel; hazard pay; allowances of foreign service personnel
stationed abroad; and such other additional compensation not otherwise specified herein as may be determined
by the Department of Budget and management (DBM).

Thereafter, the DBM issued Corporate Compensation Circular No. 10 (CCC. No. 10), directing that
effective November 1, 1989, all allowances and fringe benefits granted in addition to the basic salary, including
COLA, were deemed discontinued.

In 1991, the Court in Davao City Water District v. Civil Service Commission clarified that the Davao City
Water District, along with other local water districts, is a GOCC with original charter, hence falling within the
jurisdiction of the Civil Service Commission and Commission on Audit (COA).

In 1998, the Court then came out with a ruling in De Jesus v. COA declaring ineffective CCC No. 10
due to its lack of publication.

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On two separate dates, the Office of the Government Corporate Counsel (OGCC) issued opinions
where it opined that qualified employees of local water districts were entitled to COLA differentials from the
time local water districts were declared as GOCCs until DBM-CC No. 10 itself was declared ineffective in 1998.

Based on the aforementioned cases and the opinions issued by the OGCC, GWD’s Board of Directors
issued a resolution in 2004 authorizing accrued COLA to be paid to nineteen GWD personnel corresponding
to April 1, 1992 to March 15, 1999.

The COA Regional office, however, disallowed the payment of the COLA differentials, opining that
LOI 97 did not mention local water districts, hence they were deemed excluded. The COA-Proper affirmed
the said ruling.

ISSUES
(1) Were employees of local water districts such as GWD entitled to COLA under LOI 97?
(2) Were GWD employees entitled to COLA differentials under the Court’s ruling in De Jesus?

RULING
(1) YES. Contrary to COA’s argument, the employees of local water districts were entitled to COLA
under LOI 97. As worded, Section 1 (d) of LOI 97 specifically included local water utilities, such as GWD.

In Metropolitan Naga Water District, et al v. Commission on Audit, the Court affirmed that local water districts
fell within the coverage of LOI 97.

There is no doubt, therefore, that GWD, being a local water utility itself, was entitled to COLA as
provided under LOI 97.

(2) NO. In Republic v. Hon. Cortez, the Court aptly pronounced that the integration of the COLA into
the standardized salary is mandated by RA 6958 “to do away with multiple allowances and other incentive
packages and the resulting differences in compensation among them.”

The Court went on to state that in the recent case of Balayan Water District v. Lopez, it specifically
discussed why employees of local water districts which were organized and existing under PD 198 were not
entitled to COLA differentials:

It is provided that as a general rule, all allowances are deemed included in the standardized
salary prescribed therein. However, Section 12 of R.A. No. 6758 enumerated specific non-
integrated benefits, namely:
(a) Representation and Transportation Allowance (RATA);
(b) Clothing and laundry allowances;
(c) Subsistence allowance of marine officers and crew on board government vessels and
hospital personnel;
(d) Hazard pay;
(e) Allowances of foreign service personnel stationed abroad; and
(f) Such other additional compensation not otherwise specified herein as may be determined
by the DBM (DBM)

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In addition to the non-integrated allowances specified in Section 12, the DBM is delegated the
authority to identify other allowances that may be given to government employees in addition
to the standardized salary.

Action by the DBM is not required to implement Section 12 integrating allowances into the
standardized salary. Rather, an issuance by the DBM is required only if additional non-
integrated allowances will be identified.

Time and again, the Court has ruled that Section 12 of the SSL is self-executing. This means
that even without DBM action, the standardized salaries of government employees are already
inclusive of all allowances, save for those expressly identified in said section... When a grant
of an allowance, therefore, is not among those excluded in the Section 12 enumeration or
expressly excluded by law or DBM issuance, such allowance is deemed already given to its
recipient in their basic salary.

Prescinding from the foregoing, the Court has consistently ruled that not being an enumerated
exclusion, the COLA is deemed already incorporated i.e., the standardized salary rates of
government employees under the general rule of integration of the SSL.

Verily, COLA being already deemed integrated in the salaries of GWD employees, they were no longer
entitled to another round of COLA.

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LIGHT RAIL TRANSIT AUTHORITY v. QUEZON CITY, REPRESENTED BY THE CITY

TREASURER AND THE CITY ASSESSOR
G.R. No. 221626, 09 October 2019, SECOND DIVISION, (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

Subsection 10(10) of the Administrative Code of 1987 defines an “instrumentality as any agency of the National
Government, not integrated within the department framework, vested with special functions or jurisdiction by law, endowed with
some if not all corporate powers, administering special funds, and enjoying operational autonomy, usually through a charter.” The
Court had on several occasions clarified that the legal vesture of corporate powers in a government instrumentality does not negate
its status as such.

The category of an instrumentality with corporate powers came into being by virtue of this Court’s pronouncement in
MIAA v. Court of Appeals. Citing Section 2(10) of the Administrative Code of 1987, the Court characterized the Manila
International Airport Authority (MIAA) as an instrumentality with corporate powers.

Here, the LRTA bears the elemental characteristics of a government instrumentality vested with corporate powers. First,
the vesture of its corporate powers is found in Article 2 of Executive Order 603. Second, the LRTA performs governmental
functions. It is primarily responsible for the construction, operation, maintenance, and/or lease of light rail transit systems in the
country, giving due regard to the reasonable requirements of the public transportation system of the country. Third, the LRTA also
enjoys operational autonomy, as it exists by virtue of a Charter, and its powers and functions are vested in and exercised by its
Board of Directors.

FACTS
The Court rendered its decision in LRTA v. Central Board of Assessment Appeals, which involved the City
of Manila’s tax assessment on the Light Rail Transit Authority’s (LRTA) real properties consisting of lands,
buildings, carriageways and passenger terminal stations, machinery, and equipment considered by the City of
Manila as taxable under the Real Property Tax Code. Consequently, the LRTA received several Statements of
Delinquency and Final Notices of Tax Delinquency from Quezon City. By that time, the LRTA informed
Quezon City that pursuant to the case of MIAA v. Central Board of Assessment Appeals (CBOA) that the LRTA is
a government instrumentality, thus, exempt from real property tax. Eventually, Quezon City auctioned the
affected LRTA properties. But for lack of any interested bidders, these properties were instead sold to Quezon
City.

The LRTA then filed a petition for certiorari, prohibition and injunction against Quezon City before
the Regional Trial Court (RTC). The RTC dismissed the petition, holding that the LRTA properties are taxable
based on the Local Government Code and the Constitution. It further ruled that per LRTA v. CBOA, the
reliance of LRTA on MIAA v. CA is misplaced.

Hence, the LRTA filed a petition for review before the Court.

ISSUE
Is LRTA a Government Instrumentality?

RULING

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YES. Subsection 10(10) of the Administrative Code of 1987 defines an “instrumentality as any agency
of the National Government, not integrated within the department framework, vested with special functions
or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying
operational autonomy, usually through a charter.” The Court had on several occasions clarified that the legal
vesture of corporate powers in a government instrumentality does not negate its status as such.

The category of an instrumentality with corporate powers came into being by virtue of this Court’s
pronouncement in MIAA v. Court of Appeals. Section 2(10) of the Administrative Code of 1987, the Court
characterized the Manila International Airport Authority (MIAA) as an instrumentality with corporate powers.

In 2011, RA No. 10149, the GOCC Governance Act of 2011 was passed into law adopting such new
category under EO 596. Thus, the classification of Government Instrumentalities with Corporate Powers
(GICP)/Government Corporate Entities is now officially recognized.

Examples of instrumentalities of the national government vested with corporate powers are the Manila
International Airport Authority, the Philippine Fisheries Development Authority, the Government Service
Insurance System, and the Philippine Reclamation Authority. These entities are government instrumentalities
because each of them is not integrated within the department framework and is vested with special functions
to carry out a declared policy of the national government.

An agency will be classified as a government instrumentality vested with corporate powers when the
following elements concur: a) it performs governmental functions, and b) it enjoys operational autonomy. It
does not matter that the government instrumentality is endowed with corporate powers.

Here, the LRTA bears the elemental characteristics of a government instrumentality vested with
corporate powers.

First, the vesture of its corporate powers is found in Article 2 of Executive Order 603.

Second, the LRTA performs governmental functions. It is primarily responsible for the construction,
operation, maintenance, and/or lease of light rail transit systems in the country, giving due regard to the
reasonable requirements of the public transportation system of the country. The LRTA’s functions are less
commercial than governmental, and more for public use and public welfare than for profit-oriented services.

Third, the LRTA also enjoys operational autonomy, as it exists by virtue of a Charter, and its powers
and functions are vested in and exercised by its Board of Directors.

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FLORENCIO TUMBOCON MIRAFLORES and MA. LOURDES MARTIN MIRAFLORES v.

OFFICE OF THE OMBUDSMAN and FIELD INVESTIGATION OFFICE
G.R. Nos. 238103 and 238223, 06 January 2020, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Under Section 7 of RA 3019, every public officer is directed to file a true, detailed, and sworn statement of assets and
liabilities, including among others, a statement of the amounts and sources of his or her income and/or earnings.

Here, the record speaks for itself. Spouses Miraflores’ SALNs for 2001-2009 are totally devoid of any single entry
supposedly representing additional income or earnings derived from their aforesaid assets. Surely, this omission, by itself is a violation
of Section 7 of RA 3019, in relation to Section 8 of RA 6713.

As in Dichaves, there is here no showing that the OMB gravely abused its discretion in finding probable cause against
Spouses Miraflores for violation of Section 7 of RA 3019, in relation to Section 8 of RA 6713 and for forfeiture of unlawfully
acquired properties under RA 1379. The Court, therefore, adheres to the rule of judicial restraint or non-interference with the
OMB’s exercise of its constitutional investigative power and its consequent finding of probable cause.

FACTS
The Office of the Ombudsman (OMB) and the Field Investigation Office alleged Florencio Tumbocon
Miraflores and Ma. Lourdes Martin Miraflores (Spouses Miraflores) amassed wealth disproportionate to their
legitimate incomes. After the evaluation process, the OMB came out with its finding of probable cause that
Spouses Miraflores either undervalued, overvalued, or failed to declare certain properties in their SALNs for
2001-2009. These properties included several motor vehicles, RBII shares of stock worth P6,160,000.00, loans,
and additional incomes and earnings.

Meanwhile, Spouses Miraflores asserted that the computation of their total income should be
P12,132,519.00, an amount which is proportional to the alleged increase in their net worth of P10,237,518.02
from 2001 to 2009.

Spouses Miraflores averred that in the computation of their incomes, complaint disregarded their
incomes from their assets. Also disregarded were the incomes of their adult children and other remunerations.
Spouses Miraflores also maintained that the alleged inconsistencies in the use of fair market value or acquisition
cost in the computation of their assets arose from the difficulty in determining which reference value of the
property should be used in declaring the same in their SALNs.

To show that they declared all their properties, Spouses Miraflores alleged that they included in their
SALNs properties which they inherited but which are still undistributed and co-owned with the other heirs.
Spouses Miraflores further explained that they did not declare in their 2001 to 2009 SALNs certain vehicles all
registered in their names, as they are already owned, used and given to persons who had served their family for
many years.

Lastly, they countered that as the SALNs were prepared in good faith, the difficulty in determining
their net worth and income should not operate to disregard the legal income from them.

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Pending resolution of their motion for reconsideration, Spouses Miraflores filed a calling attention to
the decision of the Court of Appeals (CA) wherein they were cleared of any administrative liability for serious
dishonesty or grave misconduct in relation to the same 2001-2009 SALNs subject of the criminal cases.

The OMB affirmed with modification. It reduced on ground of prescription, the counts of violation
of Section 8 of RA 3019, in relation to RA 6713 against Florencio from nine to four.

ISSUES
(1) Did the OMB gravely abuse its discretion when it found probable cause against Spouses Miraflores for
violation of Section 8 of RA 3019, in relation to Section 7 of RA 6713 and for forfeiture of unlawfully
acquired properties under RA 1379?
(2) Did the OMB violate Spouses Miraflores’ right to be sufficiently informed of the charges against them?
(3) Did the OMB violate Spouses Miraflores’ right to speedy disposition of the cases which allegedly got
resolved only eight years after their investigation commenced?
(4) Does the ruling of the Court of Appeals in CA-G.R. SP No. 149592 affect the present criminal
complaints against Spouses Miraflores?

RULING
(1) NO. Spouses Miraflores have not denied that they did fail to declare in their SALNs for 2001-2009
certain motor vehicles. They in fact admitted having purchased these vehicles in their own name and using their
own money. They claim, however, that they no longer own these vehicles because they already conveyed them
gratis et amore to their valued employees as reward for their long years of loyal service to their family. In this
regard, they submitted to the OMB the letters acknowledging receipt of the vehicles by these alleged
beneficiaries.

Here, the Court agrees with the OMB that these documents, as worded, do not alter the fact that it
was Spouses Miraflores themselves who bought the vehicles in their own name and with their own funds. They
have not even shown that these vehicles are no longer registered in their names after they allegedly conveyed
them in favor of the so-called “beneficiaries.” Consequently, there is merit to the finding of the OMB that these
affidavits, standing alone, do not negate, nay, justify Spouses Miraflores’ failure to declare them in their SALNs
for 2001-2009. At any rate, whether these affidavits reflect the truth is a question of fact which the Court, not
being a trier of facts, cannot take cognizance of.

Under Section 7 of RA 3019, every public officer is directed to file a true, detailed, and sworn statement
of assets and liabilities, including among others, a statement of the amounts and sources of his or her income
and/or earnings.

Spouses Miraflores assert that aside from the salaries and allowances they received as government
elective officials, they derived other incomes and/or earnings from the fishponds, farm and coconut lots, and
rural banking business they own. The record speaks for itself. Their SALNs for 2001-2009 are totally devoid
of any single entry supposedly representing additional income or earnings derived from their aforesaid assets.
Surely, this omission, by itself is a violation of Section 7 of RA 3019, in relation to Section 8 of RA 6713.

Spouses Miraflores vigorously profess that the properties they had acquired over the years were either
financed from their salaries or from loans obtained from Pag-I.B.I.G. Fund (i.e., housing loan and Multi-

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Purpose Loan) and GSIS (i.e., Ember Salary Loan). But per Certifications, respectively, issued by Pag-I.B.I.G.
Fund and GSIS, the loan amounts declared in their SALNs were either bloated or repeatedly entered therein as
loans, albeit they had been fully paid long ago. The Court keenly notes that Spouses Miraflores have
conspicuously failed to refute these damaging findings of the OMB.

Regarding the RBII shareholdings of Lourdes, she claims to have acquired the same in 1989. When
she joined the government in 2007, however, she did not include the value of these shareholdings in her initial
SALN. She began declaring it only in her 2008 SALN where she declared that the asset had a value of
Php6,497,200.00. Lourdes seeks to clarify though that she actually had no value to declare back in 2007 because
RBII was then of negative book value. She asserts that the Bangko Sentral ng Pilipinas (BSP) even directed
RBII to infuse additional capital to save it from receivership.

The best evidence to prove this point are the financial reports submitted by RBII to the BSP and the
latter’s written directive for RBII’s infusion of additional capital. Lourdes could have easily obtained these
certifications from the files of RBII itself, but she did not. What she submitted instead were supposed
independent Audited Financial Statements, General Information Sheet (GIS) and Accountant’s Report on
RBII. Whether these documents are sufficient to excuse Lourdes from reporting the actual value of her RBII
shareholdings in her 2007 SALN is again a question of fact which the Court still cannot take cognizance of.

For purposes of filing a criminal information, probable cause pertains to facts and circumstances
sufficient to create a well-founded belief that a crime has been committed and the accused is probably guilty
thereof. As such, a finding of probable cause does not require an inquiry on whether there is sufficient evidence
to secure a conviction. The presence or absence of the elements of the crime is evidentiary in nature and a
matter of defense which may be passed upon only after a full-blown trial on the merits. In sum, whether a
party’s defense or accusation is valid and meritorious and whether the evidence presented are admissible fall
beyond the process of determining probable cause. They are for the trial court to completely determine through
a full-blown trial on the merits.

(2) NO. On Spouses Miraflores’ right to be sufficiently informed of the charges against them, the
record once more speaks for itself. They had not once, but twice responded to FIO’s charges through their
sixteen-page Joint Counter-Affidavit, seventeen-page Joint Position Paper, and their two-inch thick documents
as attachments. These submissions certainly could not have come from parties who did not sufficiently
understand the charges hurled against them.

(3) NO. Spouses Miraflores, too, harp on the OMB’s purported eight-year delay in disposing of the
cases against them. This issue is being raised for the first time here and now. They never raised it in all the eight
years the proceedings below pended. Even then, aside from claiming here that the case had dragged for over
eight years before the OMB, they have not cited the specific attendant circumstances in support of their
lamentation, e.g., the length of delay, reason for the delay, their assertion of their right to speedy disposition of
the cases against them and consequent prejudice to them, if any.

In any case, whether there was inordinate delay below is another question of fact which, again, the
Court, not being a trier of facts, cannot take cognizance of.

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(4) NO. In another vein, while indeed the CA had cleared Spouses Miraflores of any administrative
liability for serious dishonesty and grave misconduct based on the same acts for which they are criminally
charged, the same does not affect the finding of probable cause against them here. For one, there is no showing
that the decision of the CA is final and executory. For another, although the criminal cases involve the same
acts or omissions complained of in the administrative cases, their absolution in the latter does not bar their
prosecution in the former, and vice versa. The quantum of evidence required in one is different from the
quantum of evidence required in the other.

Spouses Miraflores also raise the issue of whether they can be faulted for their alternate and/or
simultaneous use of Fair Market Value and/or Acquisition Cost in the valuation of their real properties declared
in their SALNs. Suffice it to state that the presence or absence of good faith still is another question of fact.
The Court is not a trier of facts.

In closing, the Court refers to Dichaves v. Office of the Ombudsman. As in Dichaves, there is here no
showing that the OMB gravely abused its discretion in finding probable cause against Spouses Miraflores for
violation of Section 7 of RA 3019, in relation to Section 8 of RA 6713 and for forfeiture of unlawfully acquired
properties under RA 1379. The Court, therefore, adheres to the rule of judicial restraint or non-interference
with the OMB’s exercise of its constitutional investigative power and its consequent finding of probable cause.

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ASSOCIATION OF INTERNATIONAL SHIPPING LINES, INC., APL CO. PTE LTD., AND
MAERSK-FILIPINAS, INC. v. SECRETARY OF FINANCE and COMMISSIONER OF
INTERNAL REVENUE
G.R. NO. 222239, 15 JANUARY 2020, FIRST DIVISION (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

An interpretative or implementing rule is defined under Section 2 (2), Chapter 1, Book VIII of the Revised
Administrative Code, viz.:

Section 2. Definitions. - As used in this Book:

xxx
(2) "Rule" means any agency statement of general applicability that implements or interprets a law, fixes and
describes the procedures in, or practice requirements of, an agency, including its regulations. The term includes
memoranda or statements concerning the internal administration or management of an agency not affecting the
rights of, or procedure available to, the public.

Chapter 2 of Book VII of the same Code further provides the manner by which administrative rules attain effectivity:
xxx
SECTION 9. Public Participation. — (1) If not otherwise required by law, an agency shall, as far as practicable,
publish or circulate notices of proposed rules and afford interested parties the opportunity to submit their views prior to
the adoption of any rule.
(2) In the fixing of rates, no rule or final order shall be valid unless the proposed rates shall have been published in a
newspaper of general circulation at least two (2) weeks before the first hearing thereon.
(3) In case of opposition, the rules on contested cases shall be observed

Excepted are interpretative regulations and those merely internal in nature, which do not require filing with the U.P.
Law Center for their effectivity.

RR 15-2013 is an internal issuance for the guidance of "all internal revenue officers and others concerned." RR 15-
2013 merely sums up the rules by which international carriers may avail of preferential rates or exemption from income tax on
their gross revenues derived from the carriage of persons and their excess baggage based on the principle of reciprocity or an applicable
tax treaty or international agreement to which the Philippines is a signatory.

As such, RR 15-2013 need not pass through a public hearing or consultation, get published, nay, registered with the
U.P. Law Center for its effectivity.

FACTS
On 2005, Republic Act No. 93371 (RA 9337) was enacted, amending certain provisions of the 1997
National Internal Revenue Code (NIRC). Commissioner of Internal Revenue (CIR) then issued Revenue
Memorandum Circular No. 31-20082 (RMC 31-2008).

Later, Association of International Shipping Lines, Inc. (AISL), APL Co. Pte. Ltd. (APL), and Maersk-
Filipinas, Inc. (Maersk) sought to nullify RMC 31-2008 via a petition for declaratory relief. It was brought to
the Regional Trial Court in Quezon City.

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According to AISL, APL, and Maersk, RMC 31-2008 was void but the RTC stated otherwise and
decision became final and executory. Later on, Republic Act No. 10378 (RA No. 10378) amended certain
provision in the NIRC. The Secretary of Finance then issued the implementing rules under Revenue Regulation
No. 15-2013 (RR 15-2013).

Over three (3) years later, AISL, APL, and Maersk initiated a petition for declaratory relief before the
RTC, challenging the validity of Section 4.4 of RR 15-2013 and impleading both the Secretary of Finance and
the Commissioner of Internal Revenue (CIR).

AISL, APL, and Maersk argued that RR 15-2013 is invalid because it was promulgated without public
hearing as required by the Revised Administrative Code and case law. Also, no copies of RR 15-2013 were filed
with the University of the Philippines - Law Center, as required by the Revised Administrative Code, thus, the
same is deemed not to have become effective.

The RTC ruled against AISL, APL, and Maersk stating that RR No. 15-2013 to be a reasonable tax
regulation and an interpretative issuance, the effectivity of which does not require a public hearing, nay, prior
registration with the UP Law Center. AISL, APL, and Maersk then appealed to the Supreme Court.

ISSUES
(1) Is petition for declaratory relief the proper remedy as to invalidate RR15-2013?
(2) Is RR15-2013 an imperative and internal issuance?

RULING
(1) NO. One of the requisites for an action for declaratory relief is that it must be filed before any
breach or violation of an obligation. Section 1, Rule 63 of the Rules of Court states, thus:

Section 2. Parties. — All persons who have or claim any interest which would be affected by the
declaration shall be made parties; and no declaration shall, except as otherwise provided in these Rules,
prejudice the rights of persons not parties to the action. Thus, there is no actual case involved in a
Petition for Declaratory Relief. It cannot, therefore, be the proper vehicle to invoke the judicial review
powers to declare a statute unconstitutional.

It is elementary that before the Court can rule on a constitutional issue, there must first be a justiciable
controversy. A justiciable controversy refers to an existing case or controversy that is appropriate or ripe for
judicial determination, not one that is conjectural or merely anticipatory. As the Court emphasized in Angara v.
Electoral Commission, any attempt at abstraction could only lead to dialectics and barren legal questions and to
sterile conclusions unrelated to actualities.

In Diaz et at v. Secretary of Finance, et al, the Court, nonetheless, held that a petition for declaratory relief
may be treated as one for prohibition if the case has far-reaching implications and raises questions that need to
be resolved for the public good; or if the assailed act or acts of executive officials are alleged to have usurped
legislative authority.

Here, RR 15-2013 greatly impacts the Philippine maritime industry since it is considered "as more of
the 'backbone' of the Philippines' burgeoning economy due to its significance both for trade and

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transportation." For this reason and the fact that the issue at hand has already pended since 2013 or for more
than six (6) years now, first with the trial court and now with this Court, the Court resolve to treat the present
case as one for certiorari or prohibition and settle the controversy once and for all.

(2) YES. An interpretative or implementing rule is defined under Section 2 (2), Chapter 1, Book VIII
of the Revised Administrative Code, viz.:

Section 2. Definitions. - As used in this Book:

xxx
(2) "Rule" means any agency statement of general applicability that implements or interprets a
law, fixes and describes the procedures in, or practice requirements of, an agency, including
its regulations. The term includes memoranda or statements concerning the internal
administration or management of an agency not affecting the rights of, or procedure available
to, the public.

Chapter 2 of Book VII of the same Code further provides the manner by which administrative rules
attain effectivity:
xxx

SECTION 9. Public Participation. — (1) If not otherwise required by law, an agency shall, as far as
practicable, publish or circulate notices of proposed rules and afford interested parties the opportunity
to submit their views prior to the adoption of any rule.

(2) In the fixing of rates, no rule or final order shall be valid unless the proposed rates shall have been
published in a newspaper of general circulation at least two (2) weeks before the first hearing thereon.

(3) In case of opposition, the rules on contested cases shall be observed

Excepted are interpretative regulations and those merely internal in nature, which do not require filing
with the U.P. Law Center for their effectivity. On this score, ASTEC v. ERC is proper:

As interpretative regulations, the policy guidelines of the ERC on the treatment of discounts extended
by power suppliers are also not required to be filed with the U.P. Law Center in order to be effective.
Section 4, Chapter 2, Book VII of the Administrative Code of 1987 requires every rule adopted by an
agency to be filed with the U.P. Law Center to be effective. However, in Board of Trustees of the Government
Service Insurance System v. Velasco, the Court pronounced that "not all rules and regulations adopted by
every government agency are to be filed with the UP Law Center." Interpretative regulations and those
merely internal in nature are not required to be filed with the U.P. Law Center. Paragraph 9 (a) of the
Guidelines for Receiving and Publication of Rules and Regulations Filed with the U.P. Law Center
states:

9. Rules and Regulations which need not be filed with the U.P. Law Center, shall, among
others, include but not be limited to, the following:

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a. Those which are interpretative regulations and those merely internal in nature, that is,
regulating only the personnel of the Administrative agency and not the public.

RR 15-2013 is an internal issuance for the guidance of "all internal revenue officers and others
concerned." RR 15-2013 merely sums up the rules by which international carriers may avail of preferential rates
or exemption from income tax on their gross revenues derived from the carriage of persons and their excess
baggage based on the principle of reciprocity or an applicable tax treaty or international agreement to which
the Philippines is a signatory.

Interpretative regulations are intended to interpret, clarify or explain existing statutory regulations
under which the administrative body operates. Their purpose or objective is merely to construe the statute
being administered and purport to do no more than interpret the statute. Simply, they try to say what the statute
means and refer to no single person or party in particular but concern all those belonging to the same class
which may be covered by the said rules.

Indeed, when an administrative rule is merely interpretative in nature, its applicability needs nothing
further than its bare issuance, for it gives no real consequence more than what the law itself has already
prescribed. As such, RR 15-2013 need not pass through a public hearing or consultation, get published, nay,
registered with the U.P. Law Center for its effectivity.

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RADAMES F. HERRERA v. NOEL P. MAGO et al.

G.R. No. 231120, 15 January 2020, 1ST DIVISION, (Lazaro-Javier , J.)

DOCTRINE OF THE CASE

The condonation doctrine had been considered as good law since then until November 10, 2015 when the Court
promulgated Carpio-Morales v. Court of Appeals, thus:

Relatedly it should be clarified that there is no truth in Pascual's postulation that the courts would be depriving
the electorate of their right to elect their officers if condonation were not to be sanctioned. In political law, election
pertains to the process by which a particular constituency chooses an individual to hold a public office. In this
jurisdiction, there is, again, no legal basis to conclude that election automatically implies condonation. Neither
is there any legal basis to say that every democratic and republican state has an inherent regime of condonation.
If condonation of an elective official's administrative liability would perhaps, be allowed in this jurisdiction, then
the same should have been provided by law under our governing legal mechanisms. May it be at the time
of Pascual or at present, by no means has it been shown that such a law, whether in a constitutional or statutory
provision, exists. Therefore, inferring from this manifest absence, it cannot be said that the electorate's will has
been abdicated.

That being said, this Court simply finds no legal authority to sustain the condonation doctrine in this jurisdiction. As
can be seen from this discourse, it was a doctrine adopted from one class of US rulings way back in 1959 and thus, out of touch
from - and now rendered obsolete by - the current legal regime. In consequence, it is high time for this Court to abandon the
condonation doctrine that originated from Pascual, and affirmed in the cases following the same, such as Aguinaldo, Salalima,
Mayor Garcia, and Governor Garcia, Jr. which were all relied upon by the CA.

Verily, the Court holds that Herrera can no longer avail of the condonation doctrine because although the complaint
below was instituted on January 9, 2015, he got reelected only on May 9, 2016, well within the prospective application of Carpio-
Morales.

FACTS
The Sangguniang Bayan of Vinzons, Camarines Norte passed an appropriations ordinance which
intended to cover its members’ Representation and Transportation Allowance (RATA) increase in accordance
with the Local Budget Circular No. 103 (LBC No. 13) granting an increase in RATA. However, Mayor Agnes
Diezno vetoed the part for RATA differential as it exceeded the 45% statutory limitation on personal services
expenditure. The Sanggunian Bayan then unanimously voted to override the veto.

Eventually, former councilor Enrique Palacio Jr. (Palacio) wrote to Vice Mayor Radames Herrera
(Herrera) for the release of his RATA differential. In response to this, Herrera instructed Municipal Accountant
Leonilo Pajarin (Pajarin) to prepare the corresponding payroll for the RATA differentials. Consequently, Pajarin
expressed his objection to the payroll. But despite Pajarin’s reservations, the obligation requests were still
prepared. The obligation requests were then forwarded to Municipal Budget Officer Raul Rigodon (Rigodon)
who likewise refused to sign it. Subsequently, the disbursement voucher was forwarded to Municipal Treasurer
Cynthia Jimenez (Jimenez). Jimenez also refused to sign the voucher.

In the end, it was only Herrera who signed the voucher in his capacity as agency head. The RATA was
then released to the former councilors. Afterwards, the Sangguniang Panlalawigan of Camarines Norte declared

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the appropriation ordinance inoperative. Thereafter, the Commission on Audit (COA) disallowed the RATA
released to the councilors.

Noel Mago, Simeon Villacrusis, and Jose Asis, Sr. (Complainants) then filed before the Ombudsman a
complaint affidavit against Herrera, alleging grave abuse of authority, gross ignorance of law, conduct prejudicial
to the best interest of the service, and violation of the rules and regulations on the disbursement of public
funds. The Ombudsman found Herrera guilty of grave misconduct and conduct prejudicial to the best interest
of service.

Aggrieved, Herrera filed an appeal before the Court of Appeals (CA). The CA affirmed the ruling of
the Ombudsman. Herrera now went to the Court, raising the condonation doctrine. By being reelected as Vice-
Mayor, Herrera argues that he was exonerated from the charge.

ISSUE
Can Herrera avail of the Condonation Doctrine?

RULING
NO. The condonation doctrine was first enunciated on October 31, 1959 in Pascual v. Provincial
Board of Nueva Ecija, viz.:

We now come to the main issue of the controversy-the legality of disciplining an elective
municipal official for a wrongful act committed by him during his immediately preceding term
of office.

In the absence of any precedent in this jurisdiction, we have resorted to American authorities.
We found that cases on the matter are conflicting due in part, probably, to differences in
statutes and constitutional provisions, and also, in part, to & divergence of views with respect
to the question of whether the subsequent election or appointment condones the prior
misconduct. The weight of authority, however, seems to incline to the rule denying the right
to remove one from office because of misconduct during a prior term, to which we fully
subscribe.

"Offenses committed, or acts done, during previous term are generally held not to furnish
cause for removal and this is especially true where the constitution provides that the penalty
in proceedings for removal shall not extend beyond the removal from office, and
disqualification from holding office for the term for which the officer was elected, or
appointed."

The condonation doctrine had been considered as good law since then until November 10, 2015 when
the Court promulgated Carpio-Morales v. Court of Appeals, thus:

Relatedly it should be clarified that there is no truth in Pascual's postulation that the courts
would be depriving the electorate of their right to elect their officers if condonation were not
to be sanctioned. In political law, election pertains to the process by which a particular
constituency chooses an individual to hold a public office. In this jurisdiction, there is, again,

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no legal basis to conclude that election automatically implies condonation. Neither is there any
legal basis to say that every democratic and republican state has an inherent regime of
condonation. If condonation of an elective official's administrative liability would perhaps, be
allowed in this jurisdiction, then the same should have been provided by law under our
governing legal mechanisms. May it be at the time of Pascual or at present, by no means has it
been shown that such a law, whether in a constitutional or statutory provision, exists.
Therefore, inferring from this manifest absence, it cannot be said that the electorate's will has
been abdicated.

Equally infirm is Pascual's proposition that the electorate, when reelecting a local official, are
assumed to have done so with knowledge of his life and character, and that they disregarded
or forgave his faults or misconduct, if he had been guilty of any. Suffice it to state that no such
presumption exists in any statute or procedural rule. Besides, it is contrary to human
experience that the electorate would have full knowledge of a public official's misdeeds. The
Ombudsman correctly points out the reality that most corrupt acts by public officers are
shrouded in secrecy, and concealed from the public. Misconduct committed by an elective
official is easily covered up, and is almost always unknown to the electorate when they cast
their votes. At a conceptual level, condonation presupposes that the condoner has actual
knowledge of what is to be condoned. Thus, there could be no condonation of an act that is
unknown.

That being said, this Court simply finds no legal authority to sustain the condonation doctrine in this
jurisdiction. As can be seen from this discourse, it was a doctrine adopted from one class of US rulings way
back in 1959 and thus, out of touch from - and now rendered obsolete by - the current legal regime. In
consequence, it is high time for this Court to abandon the condonation doctrine that originated from Pascual,
and affirmed in the cases following the same, such as Aguinaldo, Salalima, Mayor Garcia, and Governor Garcia,
Jr. which were all relied upon by the CA.

It should, however, be clarified that this Court's abandonment of the condonation doctrine should be
prospective in application for the reason that judicial decisions applying or interpreting the laws or the
Constitution, until reversed, shall form part of the legal system of the Philippines. In Office of the Ombudsman v.
Vergara, the Court clarified that administrative cases against elective officials instituted prior to Carpio
Morales are still covered by the condonation doctrine.

Yet, in Crebello v. Ombudsman, it was underscored that the prospective application of Carpio-
Morales should be reckoned from April 12, 2016 because that was the date on which this Court had acted upon
and denied with finality the motion for clarification/motion for partial reconsideration thereon.

Verily, the Court holds that Herrera can no longer avail of the condonation doctrine because although
the complaint below was instituted on January 9, 2015, he got reelected only on May 9, 2016, well within the
prospective application of Carpio-Morales.

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ROBERTO C. EUSEBIO v. CIVIL SERVICE COMMISSION

G.R. No. 223623, 29 January 2020, 1ST DIVISION, (Lazaro-Javier, J.)

CIVIL SERVICE COMMISSION v. ROBERTO C. EUSEBIO

G.R. No. 223624, 29 January 2020, 1ST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Under Section 6, Article IX-A of the 1987 Constitution, the CSC en banc may promulgate its own rules concerning
pleadings and practice before any of its offices so long as such rules do not diminish, increase, or modify substantive rights.

Further, Section 12(2), Title I(A), Book V of E.O. 292 ordains:

SECTION 12. Powers and Functions. -The Commission shall have the following powers and functions:
xxx
(2) Prescribe amend and enforce rules and regulations for carrying into effect the provisions of the Civil Service Law and
other pertinent laws;
xxxx
All told, the CSC did not act arbitrarily when it prescribed a fine of P1,000.00 per day as penalty for Eusebio's repeated
defiance of the final and executory judgment of the CSC. The penalty is reasonable and fair in relation to the purpose of preserving
the CSC's Constitutional mandate as the central personnel agency of the Philippine government tasked with rendering final
arbitration on disputes regarding personnel actions in the civil service and implementing civil service rules and regulations.

FACTS
Then Pasig City Mayor Robert Eusebio (Eusebio) appointed retired career diplomat Rosalina Tirona
(Tirona) as the President of the Pamantasan ng Lungsod ng Pasig (PLP) for a four (4) year term. The Civil
Service Commission (CSC) approved Tirona’s appointment. Upon Eusebio’s reelection, he issued a
memorandum urging all chiefs of office to tender their courtesy resignation. Tirona refused to resign.
Consequently, Eusebio terminated Tirona’s appointment citing Tirona having aged the compulsory retirement
age of seventy (70).

Aggrieved, Tirona questioned her termination before the CSC. The CSC ruled in favor of Tirona and
ordering her reinstatement. However, Eusebio did not comply with the order of the CSC to reinstate Tirona in
the absence of an injunction relief. As a result thereof, the CSC motu proprio charged Eusebio with indirect
contempt.

After due proceedings, the CSC then held Eusebio liable for indirect contempt and imposed on him a
fine. Accordingly, Eusebio filed a petition for review before the Court of Appeals, assailing the decision of the
CSC. The CA affirmed the ruling of the CSC but it modified the imposition of fine, reducing it to a smaller
amount. Hence, the petition before the Court.

ISSUE
Can the CSC impose the penalty of fine in indirect contempt cases?

RULING

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YES. Under Section 6, Article IX-A of the 1987 Constitution, the CSC en banc may promulgate its
own rules concerning pleadings and practice before any of its offices so long as such rules do not diminish,
increase, or modify substantive rights.

Further, Section 12(2), Title I(A), Book V of Executive Order 292 ordains:

SECTION 12. Powers and Functions. - The Commission shall have the following
powers and functions:
xxxx
(2) Prescribe amend and enforce rules and regulations for carrying into effect the
provisions of the Civil Service Law and other pertinent laws;
xxxx

While it is true that Section 16(2)(d), Title I(A), Book V of EO 29233 states that the CSC through its
adjudicative arm shall have the power to "punish for contempt in accordance with the same procedures and
penalties prescribed in the Rules of Court", Section 12, Rule 71 of the Rules of Court states that the application
of said rules is merely suppletory, viz:

Section 12. Contempt against quasi-judicial entities. - Unless otherwise provided by law,
this Rule shall apply to contempt committed against persons, entities, bodies or agencies
exercising quasi-judicial functions, or shall have suppletory effect to such rules as they may
have adopted pursuant to authority granted to them by law to punish for contempt. The
Regional Trial Court of the place wherein the contempt has been committed shall have
jurisdiction over such charges as may be filed therefor.

Indeed, the Rules of Court must defer to the CSC's power to promulgate and apply its own rules in
penalizing contempt committed against it. The existence of the CSC's Revised Rules on Contempt, therefore,
calls for the application of its own procedure and penalties, thus, precluding Section 7, Rule 7 of the Rules of
Court from coming into play at first instance. This is not an expansion of the CSC's authority to punish for
contempt under EO 292 but the Court's deference to the CSC to wield such power.

Under Section 4 of the CSC Revised Rules on Contempt, a fine of P1,000.00 may be imposed on the
contemnor for each day of defiance of, disobedience to, or non-enforcement of, a final ruling of the CSC.
Further, if the contempt consists in the violation of an injunction or omission to do an act which is within the
power of respondent to perform, he or she, in addition, shall be liable for damages as a consequence thereof.

In accordance, therefore, with Section 4 of the CSC Revised Rules on Contempt, the CSC imposed a
fine of P1,000.00 per day or a total of P416,000.00 on Eusebio for his contumacious defiance of the CSC's
directive to reinstate Tirona to her post as PLP President. This conforms with the subsequent CSC rules
penalizing contumacious conduct before it.

To emphasize, Eusebio's failure to reinstate Tirona as PLP President did not only come with the
obvious consequence of depriving her of the salaries and emoluments she would have been entitled to. More
than this, the public was unduly deprived of the professional services Tirona would have been able to render
them as PLP President. As it was, Eusebio's omission to reinstate Tirona was not only deliberate, but undeniably

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tainted with evident bad faith. As the Court of Appeals aptly ruled, time was of the essence in Tirona's
reinstatement since her term was only until January 31, 2012. Eusebio could not have plausibly feigned
ignorance of the immediately executory nature of CSC rulings since he had served as chief executive of Pasig
City for three (3) terms. What manifestly appears on record was Eusebio's obstinate refusal to implement the
immediately executory CSC rulings for over four hundred sixteen (416) days. In fact, even on appeal, Eusebio
continued to defy the CSC 's order of reinstatement despite the appellate court's non-issuance of an injunctive
writ against its implementation. In the end, Eusebio's appeal outlived Tirona's supposed term. The eventual
dismissal of CA-G.R. SP No. 117512 became a mere paper victory for Tirona. She was prevented from
assuming her office and performing her functions as PLP president to the detriment not only of herself and
PLP, but more importantly, the stakeholders of the institution.

All told, the CSC did not act arbitrarily when it prescribed a fine of P1,000.00 per day as penalty for
Eusebio's repeated defiance of the final and executory judgment of the CSC. The penalty is reasonable and fair
in relation to the purpose of preserving the CSC's Constitutional mandate as the central personnel agency of
the Philippine government tasked with rendering final arbitration on disputes regarding personnel actions in
the civil service and implementing civil service rules and regulations.

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MUNICIPALITY OF BAKUN, BENGUET v. MUNICIPALITY OF SUGPON, ILOCOS SUR

G.R. No. 224335, 02 March 2020, 1ST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 1 of Act No. 2877 reads:

Section 1. The present boundary line between the Mountain Province and the Provinces of Ilocos Sur and La
Union is hereby modified and fixed by moving it eastward to a location beginning approximately at the northeast
corner of the present subprovince, of Lepanto and running in a direction slightly southwest to the point of
intersection of the present boundaries between Amburayan, Lepanto, and Benguet, thence following the present
boundary between the subprovinces of Amburayan and Benguet to its intersection with the boundary line of the
Province of La Union. The portion of the present subprovince of Lepanto lying east of the new boundary line
is hereby added to the subprovince of Bontoc. All territories west of said line, which include various municipal
districts which commercially are naturally tributary to the seaport towns of Ilocos Sur and La Union, are hereby
transferred to, and made part of, said provinces. The provincial boards of the provinces concerned need not order
a survey of said boundary line but only shall cause the erection of monuments at convenient or necessary points
on said line for the guidance of local officials and the public in general. To this end, the provincial boards of
Ilocos Sur and La Union, or such representatives as may be duly authorized by them, shall confer with the
provincial board of the Mountain Province or its duly authorized representatives with a view to locating and
monumenting the boundary line herein fixed, and the line thus monumented, if approved by the Secretary of the
Interior, shall be the boundary between the Mountain Province and the Provinces of Ilocos Sur and La Union.

Moreover, even applying the guidelines set in Act No. 1646 in establishing the new boundary lines
between the sub-province of Amburayan and the provinces of Ilocos Sur and La Union, and Act No. 2877 in
modifying the boundaries between the Mountain Province and the provinces of Ilocos Sur and La Union, they
do not prove that the disputed properties would form part of the territory of Bakun. Bakun simply failed to
show, by preponderant evidence, that the conflicted areas are located within the "new boundary line."

FACTS
The Municipality of Bakun, Benguet (Bakun) and the Municipality of Sugpon, Ilocos Sur (Sugpon) both
lay claim on a parcel of land found in the middle of their respective territories. Thus, in line with the provisions
of the 1991 Local Government Code (LGC) on boundary disputes, the issue was referred to an Ad Hoc Joint
Sanggunian of the Provinces of Benguet and Ilocos Sur. After due proceedings, the land was adjudged in favor
of Bakun.

Aggrieved, Sugpon served a notice of appeal to the Sangguniang Panlalawigan of the Province of
Benguet. However, Sugpon subsequently filed with the Regional Trial Court (RTC) a “Petition to Appeal”. The
RTC took cognizance of the case and denied the motion to dismiss filed by Bakun. It held that the governing
law on boundary disputes, the LGC, merely mandates the "filing of any appropriate pleading", which Sugpon
duly complied with via its "Petition on Appeal". As for the alleged defect in the Notice of Appeal, what is truly
material is the fact that its primary purpose of informing the tribunal and the other party of the appeal was
served

Bakun then filed its appeal before the Court of Appeals (CA). The CA affirmed the RTC’s disposition
on Sugpon’s notice of appeal. Hence, the recourse before the Court.

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ISSUE
Did Act 2877 fix the exact boundaries of the municipalities of Bakun and Sugpon?

RULING
NO. Act No. 2877, however, did not categorically fix the exact boundaries of the municipalities of
Bakun and Sugpon. Section 1 of Act No. 2877 reads:

Section 1. The present boundary line between the Mountain Province and the Provinces of
Ilocos Sur and La Union is hereby modified and fixed by moving it eastward to a location
beginning approximately at the northeast corner of the present subprovince, of Lepanto and
running in a direction slightly southwest to the point of intersection of the present boundaries
between Amburayan, Lepanto, and Benguet, thence following the present boundary between
the subprovinces of Amburayan and Benguet to its intersection with the boundary line of the
Province of La Union. The portion of the present subprovince of Lepanto lying east of the
new boundary line is hereby added to the subprovince of Bontoc. All territories west of said
line, which include various municipal districts which commercially are naturally tributary to
the seaport towns of Ilocos Sur and La Union, are hereby transferred to, and made part of,
said provinces. The provincial boards of the provinces concerned need not order a survey of
said boundary line but only shall cause the erection of monuments at convenient or necessary
points on said line for the guidance of local officials and the public in general. To this end, the
provincial boards of Ilocos Sur and La Union, or such representatives as may be duly
authorized by them, shall confer with the provincial board of the Mountain Province or its
duly authorized representatives with a view to locating and monumenting the boundary line
herein fixed, and the line thus monumented, if approved by the Secretary of the Interior, shall
be the boundary between the Mountain Province and the Provinces of Ilocos Sur and La
Union.

The Court agrees with the observation of the RTC:

There is then no clear basis provided for in these early laws to resolve the controversy at hand.
It may provide a historical and legal basis of how these once integral upland territories have
been subdivided to become components of the provinces they belong in these present times
but is a vague and inadequate basis to resolve the controversy herein presented. In fact,
inasmuch as Bakun along with the municipal districts of Alilem, Suyo, Sugpon, Sigay, Santol,
Sudipen, [and] Bagulin comprised the then Amburayan Subprovince, with Tagudin as its
capital, it may be argued that Bakun is a part of Ilocos Sur. in relation to the technical
description in Section 1 of Act No. 2877. This submission is reinforced in the light of Sugpon's
position that "Bakun does not even cite any organic law of its sole creation or proffer any
evidence whatsoever of its creation or how was it included in the Province of Benguet.

Moreover, even applying the guidelines set in Act No. 1646 in establishing the new boundary lines
between the sub-province of Amburayan and the provinces of Ilocos Sur and La Union, and Act No. 2877 in
modifying the boundaries between the Mountain Province and the provinces of Ilocos Sur and La Union, they

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do not prove that the disputed properties would form part of the territory of Bakun. Bakun simply failed to
show, by preponderant evidence, that the conflicted areas are located within the "new boundary line." It bears
noting that Bakun presented only five (5) documents to prove its claim:
(a) a copy of Act Nos. 1645-1648 and Philippine Legislative Act Nos. 2876 and 2877;
(b) Joint Resolution No. 1, Series of 2014;
(c) daily wage payrolls, disbursement vouchers for the payment of different contracts about different
projects accomplished by Bakun in the disputed area, plantilla of appointments of different employees,
and a list of projects undertaken by Bakun in the area;
(d) copies of tax declarations; and
(e) a list of registered voters of Barangay Nagawa, Bakun, Benguet. These pieces of evidence show that
Bakun exercised some acts of dominion over the property, but do not prove that the modified
boundary line covers the disputed areas.

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PHILIPPINE HEART CENTER v. THE LOCAL GOVERNMENT OF QUEZON CITY, CITY

MAYOR OF QUEZON CITY, CITY TREASURER OF QUEZON CITY AND CITY ASSESSOR
OF QUEZON CITY
G.R. No. 225409, 11 March 2020, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 2(10) of Executive Order (EO) 292, the Administrative Code of 1987, defines an "Instrumentality" as "any
agency of the National Government, not integrated within the department framework, vested with special functions or jurisdiction
by law, endowed with some if not all corporate powers, administering special funds, and enjoying operational autonomy, usually
through a charter." From this definition, the category of an instrumentality with corporate powers was born. In 2011, RA 10149,
the GOCC Governance Act of 2011, further formalized the creation of this new category. In addition to government-owned and
controlled corporations (GOCCs) and instrumentalities, a third category of government agencies under the jurisdiction of the OGCC
is now recognized -- government instrumentalities vested with corporate powers or government corporate entities. These entities remain
government instrumentalities because they are not integrated within the department framework and are vested with special functions
to carry out a declared policy of the national government.

An agency will be classified as a government instrumentality vested with corporate powers when the following elements
concur: a) it performs governmental functions, and b) it enjoys operational autonomy. The PHC passes these twin criteria. Although
not integrated in the department framework, the PHC is under supervision of the DOH and carries out government policies in
pursuit of its objectives in Section 4 of PD 673.

Certainly, the PHCs' enumerated functions are less commercial than governmental, and more for public use and public
welfare than for profit-oriented services. As such, the PHC is authorized to "call upon any department, bureau, office, agency or
instrumentality of the Government, including government-owned or controlled corporations, for such assistance as it may need in the
pursuit of its purposes and objectives."

Too, the PHC is vested with corporate powers under Section 5 of PD 673. The provision itself vests the PHC with all
the powers of a juridical entity under Section 35 of Republic Act No. 11232, the Revised Corporation Code of the Philippines.
The general clauses in paragraphs 8 and 9 of Section 5, PD 673 likewise authorize the PHC to adopt rules and perform acts
necessary to accomplish its purposes. The PHC therefore bears the essential characteristics of a government instrumentality vested
with corporate powers, exempt from real property taxes. Indeed, the PHC's corporate status does not divest itself of its character as
a government instrumentality. These are not polar opposites. For despite its corporate status, it is really the resources and reputation
of the Republic that are at stake in the capitalization and operations of the government entity.

FACTS
The Philippine Heart Center (PHC) is a government-owned corporation mandated to provide
cardiovascular care services. It was established by virtue of Presidential Decree (P.D.) 673. P.D. 673 exempted
the PHC from "the payment of all taxes, charges, fees imposed by the Government or any political subdivision
or instrumentality thereof" for a period of ten (10) years. In 1985, then President Ferdinand E. Marcos issued
Letter of Instruction (LOI) No. 1455 extending the tax exemption "without interruption. Among the properties
owned by the PHC were eleven (11) land and buildings in Quezon City.

In 2004, the Quezon City Government issued three (3) final Notices of Delinquency for unpaid real
property taxes amounting to ₱36,530,545.00 pertaining to the eleven (11) afore-cited properties of the PHC.
The notices were unheeded, thus, the Quezon City Treasurer levied on the PHC's properties.

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The Quezon City Government, nonetheless, stood firm on its position that the PHC was and still
remained liable for real property taxes since a major portion of its properties were being leased to private
individuals. Thus, on 1 June 2001, it issued two (2) Final Notices of Tax Delinquency to the PHC.

On 13 June 2011, the Quezon City Treasurer issued a Warrant of Levy for the PHC 's failure to pay
real property taxes despite due notice. On 7 July 2011, after due publication, all the properties were sold to the
Quezon City Government, the lone bidder during the public auction.

On 1 September 2011, the PHC filed a petition for certiorari before the Court of Appeals, claiming
that the Quezon City Government, Mayor, Treasurer and Assessor gravely abused their discretion when they
assessed, levied and sold its properties.

At first, the appellate court on 25 September 2012 dismissed the petition for failure of the PHC to
exhaust administrative remedies available to it under Section 252 of RA 7160. However, the Court of Appeals
reinstated the petition on 18 March 2013. It held that the remedies under Section 252 of RA 7160 are no longer
plain, speedy, nor adequate since the properties in issue had already been auctioned off and sold to the Quezon
City Government. On 15 March 2016, however, the Court of Appeals dismissed anew the PHC's petition for
certiorari.

Aggrieved, the PHC appealed the matter to the Supreme Court.

ISSUE
Is the PHC a government instrumentality covered by tax exemption.?

RULING
YES. Section 2(10) of Executive Order (EO) 292, the Administrative Code of 1987, defines an
"Instrumentality" as "any agency of the National Government, not integrated within the department
framework, vested with special functions or jurisdiction by law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational autonomy, usually through a charter." From this
definition, the category of an instrumentality with corporate powers was born. In 2011, RA 10149, the GOCC
Governance Act of 2011, further formalized the creation of this new category.

In addition to government-owned and controlled corporations (GOCCs) and instrumentalities, a third

category of government agencies under the jurisdiction of the OGCC is now recognized -- government
instrumentalities vested with corporate powers or government corporate entities. These entities remain
government instrumentalities because they are not integrated within the department framework and are vested
with special functions to carry out a declared policy of the national government.

An agency will be classified as a government instrumentality vested with corporate powers when the
following elements concur: a) it performs governmental functions, and b) it enjoys operational autonomy. The
PHC passes these twin criteria.

Although not integrated in the department framework, the PHC is under supervision of the DOH and
carries out government policies in pursuit of its objectives in Section 4 of PD 673.

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Certainly, the PHCs' enumerated functions are less commercial than governmental, and more for
public use and public welfare than for profit-oriented services. As such, the PHC is authorized to "call upon
any department, bureau, office, agency or instrumentality of the Government, including government-owned or
controlled corporations, for such assistance as it may need in the pursuit of its purposes and objectives."

Too, the PHC is vested with corporate powers under Section 5 of PD 673. The provision itself vests
the PHC with all the powers of a juridical entity under Section 35 of Republic Act No. 11232, the Revised
Corporation Code of the Philippines. The general clauses in paragraphs 8 and 9 of Section 5, PD 673 likewise
authorize the PHC to adopt rules and perform acts necessary to accomplish its purposes.

The PHC therefore bears the essential characteristics of a government instrumentality vested with
corporate powers, exempt from real property taxes. Indeed, the PHC's corporate status does not divest itself
of its character as a government instrumentality. These are not polar opposites. For despite its corporate status,
it is really the resources and reputation of the Republic that are at stake in the capitalization and operations of
the government entity.

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TAISEI SHIMIZU JOINT VENTURE v. COMMISSION ON AUDIT and the DEPARTMENT

OF TRANSPORTATION (formerly Department of Transportation and Communication)
G.R. No. 238671, 02 June 2020, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

There is nothing in the Constitution, laws, or even the COA rules expressly granting the COA original and exclusive
jurisdiction over money claims due from or owing to the government

In this case, considering that TSJV and DOTr had voluntarily invoked CIAC’s jurisdiction, the power to hear and
decide the present case has thereby been solely vested in the CIAC to the exclusion of COA. Being a specific law, EO No. 1008
providing for CIAC’s exclusive jurisdiction prevails over PD 1445, granting the COA the general jurisdiction over money claims
due from or owing to the government. For this reason alone, the COA should have stayed its hands from modifying the CIAC’s
final arbitral award here, let alone from claiming exclusive jurisdiction over the case.

FACTS
Taisei Shimizu Joint Venture (TSJV) won the contract award for the construction of the New Iloilo
Airport. As project proponent, the Department of Transportation (DOTr) entered into a contract agreement
with TSJV pertaining to the construction. Following the project’s completion and delivery, it turned out that
some TSJV billings had been left unpaid.

After TSJV’s initial effort to collect failed, it filed with the CIAC a Request for Arbitration and
Complaint, seeking payment of the following money claims. In defense of the government, the DOTr
responded to the Complaint and actively participated in the CIAC proceedings. The CIAC granted
Php223,401,870.83 to TSJV. The DOTr was likewise directed to pay six percent (6%) interest per annum on
the total amount from the finality of the Final Award until full payment.

Subsequently acting on the DOTr’s motion for correction of the Final Award, the CIAC amended the
Final Award.

Following the finality of the CIAC’s Final Award, TSJV moved for its execution. The DOTr opposed
on ground that the funds sought to be levied were public in character. The CIAC nevertheless granted the
motion for execution.

The Ex Officio Sheriff thereafter served a demand to satisfy the arbitral award on the DOTr and issued
notices of garnishment to the Philippine National Bank (PNB), Philippine Veterans Bank (PVB), Land Bank
of the Philippines (LBP), and Development Bank of the Philippines (DBP). The DOTr later on advised TSJV
in writing that the arbitral award should be referred to the COA as condition sine qua non for payment.
Meanwhile, the DBP, PVB, and PNB separately informed the Sheriff that they did not hold funds or properties
in the DOTr’s name. On the other hand, the LBP advised that TSJV must first seek the COA’s approval for
payment of the arbitral award.

Again, after its initial effort to execute failed, TSJV subsequently filed with the COA a petition for
enforcement and payment of the arbitral award.

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Asserting its primary jurisdiction over money claims against government agencies and instrumentalities,
the COA claimed to have reviewed the evidence and approved payment but only to the extent of
Php104,661,421.35 or less than half of the total award.

After receiving the approved award of Php104,661,421.35, TSJV pursued its partial motion for
reconsideration as regards the remaining amount of Php111,412,565.54.

TSJV now seeks affirmative relief from the Court, charging the COA with grave abuse of discretion,
amounting to excess or lack of jurisdiction in disturbing the immutable and final arbitral award in its favor.

The COA essentially counters: (a) it has primary jurisdiction over all money claims against the
government; (b) even if a final and executory judgment had already validated a monetary claim against a
government agency, its approval is still a condition sine qua non for payment; (c) in approving or disapproving
the claim, the COA exercises a quasi-judicial function requiring it to rule on the propriety of the money claim
based on the evidence presented before it; and (d) it could not be charged with grave abuse of discretion when
its action was simply in accord with the law and the evidence.

ISSUES
(1) Does the COA have exclusive jurisdiction over money claims due from or owing to the government?
(2) In the exercise of its audit power, may the COA disturb the final and executory decisions of courts,
tribunals or other adjudicative bodies?

RULING
(1) NO. First off, there is nothing in the Constitution, laws, or even the COA rules expressly granting
the COA original and exclusive jurisdiction over money claims due from or owing to the government.

For one, Batas Pambansa Blg. 129 as amended by RA 7691 vests jurisdiction over money claims in the
first and second level courts.

Actions against the State are not excluded from the jurisdiction of courts. For although, as a
rule, the State is immune from suit, it is settled that “a suit against the State is allowed when
the State gives its consent, either expressly or impliedly. Express consent is given through a
statute, while implied consent is given when the State enters into a contract or commences
litigation.”

The Court recently held that although the COA exercises broad powers pertaining to audit matters, it
is devoid of authority to determine the validity of contracts, lest it encroaches upon such judicial function. The
Court further decreed that the COA’s jurisdiction is limited to audit matters only. Hence, the Court set aside a
ruling of the COA disapproving a deed of exchange between the City Government of Cebu and a private
corporation. The case clearly demonstrated why it was not unusual for the government and its instrumentalities
to be sued in the regular courts even when the action involved government funds or property since such an
action may entail resolution of issues falling within the jurisdiction of the courts.

Other tribunals/adjudicative bodies, too, may have concurrent jurisdiction with the COA over money
claims against the government or in the audit of the funds of government agencies and instrumentalities.

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For instance, in Development Bank of the Philippines v. COA, the Court held that the Central Bank
has concurrent jurisdiction to examine and audit, or cause the examination and audit, of government banks.

Further, in Civil Service Commission (CSC) v. Pobre, the Court reversed the ruling of the Court of
Appeals that the COA had sole jurisdiction over the matter of computing a government employee's terminal
leave benefits.

In this case, considering that TSJV and DOTr had voluntarily invoked CIAC’s jurisdiction, the power
to hear and decide the present case has thereby been solely vested in the CIAC to the exclusion of COA. Being
a specific law, EO No. 1008 providing for CIAC’s exclusive jurisdiction prevails over PD 1445, granting the
COA the general jurisdiction over money claims due from or owing to the government. For this reason alone,
the COA should have stayed its hands from modifying the CIAC’s final arbitral award here, let alone from
claiming exclusive jurisdiction over the case.

(2) NO. There are two (2) main types of money claims which the COA may be confronted with. The
first type covers money claims originally filed with the COA. Jurisprudence specifies the nature of the money
claims which may be brought to the COA at first instance. The second type of money claims refers to those
which arise from a final and executory judgment of a court or arbitral body.

As held in Uy v. COA, final judgments may no longer be reviewed or, in any way be modified directly
or indirectly by a higher court, not even by the Supreme Court, much less, by any other official, branch or
department of government.

On this score, the Court lays down a conceptual framework for the guidance of the COA, the Bench,
and the Bar pertaining to the COA’s audit power vis-à- vis the second type of money claims which may be
brought before it during the execution stage.

Even if the Court broadly interprets the COA’s jurisdiction as including all kinds of money claims, it
cannot take cognizance of factual and legal issues that have been raised or could have been raised in a court or
other tribunal that had previously acquired jurisdiction over the same. To repeat, the COA’s original jurisdiction
is actually limited to liquidated claims and quantum meruit cases. It cannot interfere with the findings of a court
or an adjudicative body that decided an unliquidated money claim involving issues requiring the exercise of
judicial functions or specialized knowledge and expertise which the COA does not have in the first place.

Once judgment is rendered by a court or tribunal over a money claim involving the State, it may only
be set aside or modified through the proper mode of appeal. It is elementary that the right to appeal is statutory.
There is no constitutional nor statutory provision giving the COA review powers akin to an appellate body
such as the power to modify or set aside a judgment of a court or other tribunal on errors of fact or law.

When a court or tribunal having jurisdiction over an action renders judgment and the same becomes
final and executory, res judicata sets in. Res judicata and immutability of final judgments are closely intertwined.

Indeed, a final and executory judgment can no longer be disturbed, altered, or modified in any respect,
and that nothing further can be done but to execute it. Succinctly, an execution court may no longer alter a final

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and executory judgment save under certain exceptions such as (i) the correction of clerical errors; (ii) the so-
called nunc pro tunc entries which cause no prejudice to any party; (iii) void judgments; and (iv) whenever
circumstances transpire after the finality of the decision rendering its execution unjust and inequitable. This is
true even if the purpose of the modification or amendment is to correct perceived errors of law or fact.

In relation to its audit review power, therefore, the COA here should have restricted itself to
determining the source of public funds from which the final and executory arbitral award may be satisfied
pursuant to the general auditing laws the COA is tasked to implement.

To recapitulate, the final and executory arbitral award in this case was validly issued by the CIAC in
the exercise of its jurisdiction over the construction dispute between TSJV and the DOTr. These parties
voluntarily submitted themselves to the arbitration proceedings below. In the end, both parties accepted the
CIAC’s modified final award and neither one nor the other sought a review thereof with the Court of Appeals
or this Court. As it was, the CIAC’s final award is conclusive and binding on all the factual and legal issues
taken up therein and bars their re-litigation in any subsequent proceeding between the parties.

To be sure, when the COA disallowed more than half of the arbitral award here, it did not raise any
jurisdictional grounds nor invoice any of the exceptions to the doctrine of immutability of final judgments.
What the COA did was reweigh the evidence on record and point out purported errors of fact and law in the
arbitral award. This is certainly beyond the COA’s constitutional mandate to audit and review the enforcement
of money claims against the government. It is also contrary to jurisprudentially defined limitations to its audit
powers. To accept the COA’s theory that it has absolute discretion to disregard final and executory judgments
rendered by courts and other adjudicative bodies in valid exercise of their jurisdiction would wreak havoc on
the efficient and orderly administration of justice. The COA then becomes a super body over and above the
rule of law.

Grave abuse of discretion is committed when an act is: 1) done contrary to the Constitution, the law
or jurisprudence, or 2) executed whimsically or arbitrarily in a manner so patent and so gross as to amount to
an evasion of a positive duty, or to a virtual refusal to perform the duty enjoined.

The COA’s grave abuse of discretion here lies in its apparent overestimation of its audit review powers
in connection with final money claims properly litigated and finally determined in another forum, leading it to
transgress long standing legal principles and case doctrine. This, the Court simply cannot allow. It is well-settled
that the jurisdiction to delimit constitutional boundaries has been given to this Court. The Court will not shirk
our duty to rein in State actors or agents who overstep their authority.

While the Court rules that the COA may no longer modify the amount of the award, it is not within
the Court’s power to determine the manner for enforcement or satisfaction thereof as this should still be
pursued in accordance with the rules and procedures laid down in P.D. No. 1445 and other relevant laws. The
Court cannot substitute its discretion for that of the COA in this matter. More so in view of the undisputed
fact that the certificate of availability of funds to satisfy the arbitral award already expired on December 31,
2016 The Court, therefore, resolve to remand this case to the COA for disposition of TSJV’s petition for full
payment of the balance of the final arbitral award in accordance with the guidelines established in this Decision.

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FORFOM DEVELOPMENT CORPORATION v. PHILIPPINE NATIONAL RAILWAYS

G.R. No. 227432, 30 June 2020, FIRST DIVISION, (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

The primary reason behind the rule on estoppel against the owner is public necessity, to prevent loss and inconvenience to
passengers and shippers using the line. Therefore, if the property is no longer being used as a railway, no irreparable injury will be
caused to PNR and the public in general if Forfom regained possession of its property. In such case, Forfom would no longer be
precluded from challenging the expropriation proceedings. Preventing Forfom from challenging the expropriation case and allowing
PNR to expropriate the property without a public purpose would be highly unjust and violative of the Constitution requiring that
property be "taken for public use."

Here, the expropriation case requires the resolution of the following issues, viz.: as threshold issue, the determination of
the public purpose of the expropriation proceedings, the alleged right, if any, of PNR to lease out the affected properties and collect
rentals from the lessees concerned vis-a-vis the alleged right of the owners to demand the turnover to them of the rental collections.

FACTS
In a December 10, 2008 decision (2008 Decision) entitled Forfom Development Corporation v. Philippine
National Railway, the Supreme Court (SC) directed Philippine National Railways (PNR) to institute the
appropriate expropriation case on subject lots for the purpose of determining just compensation.

Following its finality, PNR initiated the complaint for expropriation before the Regional Trial Court
(RTC). It sought to expropriate subject lots owned by Forfom Development Corporation (Forfom) for the
PNR's San Pedro-Carmona Commuter Line Project.

Meanwhile, Forfom filed with the SC a Motion to Show Cause in connection with the 2008 Decision.
It asserted that the PNR should be cited for contempt for: (1) not disclosing to the Court that it had already
abandoned the railway system for which the supposed complaint for expropriation was sought to be filed; (2)
delaying the filing the expropriation case; and (3) leasing out subject properties to private individuals ultra vires.

On May 18, 2011, Forfom also filed with the RTC its Answer with prayer for injunction seeking anew
the dismissal of the case, with damages. It also moved to set its affirmative defenses for hearing. However, the
RTC denied the motion and set the case for preliminary conference and pre-trial. Eventually, the RTC issued
its Pre-Trial Order.

On April 18, 2012, Forfom again moved to dismiss the Complaint, this time, citing as ground the
failure of the PNR and the Office of the Solicitor General (OSG) to appear during hearings. The OSG opposed
the motion, asserting that said hearings were reset because of its intention to file a motion to modify the Pre-
Trial Order. The OSG asked to modify the Pre-Trial Order to conform with the 2008 Decision. It asserted that
the issues to be resolved in the case should be limited to the determination of the amount of just compensation
as of the time of taking in 1973 and the amount of damages for the improvement that were destroyed. The
OSG also prayed that the RTC issue the order of expropriation and appoint the members of the Board of
Commissioners.

Subsequently, the RTC granted OSG’s motion. From its end, Forfom went to the Court of Appeals
(CA) to challenge the RTC orders.

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While the case in the CA was pending, the SC issued a Resolution in July 1, 2015 (2015 Resolution)
modifying the 2008 Decision finding the concerned PNR officials guilty of indirect contempt for delaying the
filing of the expropriation case for eighteen (18) months and for their failure to inform the Court that the PNR
had already removed the railroad tracks along the entire San Pedro-Carmona line before it could even file the
expropriation case. In view of such, the SC resolved to modify its 2008 Decision.

The CA dismissed Forfom’s petition since the RTC’s orders may no longer be assailed beyond the
sixty-day reglementary period.

In a motion for reconsideration, Forfom invoked the 2015 Resolution and argued that since the
construction of the Project had already been abandoned, the expropriation of subject lots for this supposed
public purpose should be dismissed.

ISSUE
Should the RTC act on the expropriation case, with dispatch, in view of the modification of the SC’s
2008 Decision?

RULING
YES. The RTC should act on the expropriation case, with dispatch. With respect, however, to the
existence of public purpose for which the expropriation is being sought, the authority of the PNR to lease out
subject lots, the right to recover from PNR the rentals on lots belonging to Forfom, and the amount of just
compensation due to Forfom over the affected lots, the Court rule that these are live and real issues pending
with the trial court which it is mandated to resolve pursuant to the Court's Resolution dated July 1, 2015, viz.:

The Court reiterates that the primary reason behind the rule on estoppel against the owner is
public necessity, to prevent loss and inconvenience to passengers and shippers using the line.
Therefore, if the property is no longer being used as a railway, no irreparable injury will be
caused to PNR and the public in general if Forfom regained possession of its property. In
such case, Forfom would no longer be precluded from challenging the expropriation
proceedings. Preventing Forfom from challenging the expropriation case and allowing PNR
to expropriate the property without a public purpose would be highly unjust and violative of
the Constitution requiring that property be "taken for public use."

In fine, the expropriation case requires the resolution of the following issues, viz.: as threshold issue,
the determination of the public purpose of the expropriation proceedings, the alleged right, if any, of PNR to
lease out the affected properties and collect rentals from the lessees concerned vis-a-vis the alleged right of the
owners to demand the turnover to them of the rental collections. The RTC should conduct a hearing on these
issues and resolve the same, with utmost dispatch.

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PEOPLE OF THE PHILIPPINES v. THE HONORABLE FOURTH DIVISION,

SANDIGANBAYAN and RAUL Y. DESEMBRANA
G.R. No. 233061-62, 28 July 2020, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

If the delay occurs beyond the given time period and the right is invoked, the prosecution has the burden of justifying the
delay. The prosecution must prove: (a) that it followed the prescribed procedure in the conduct of preliminary investigation and case
prosecution; (b) the delay was inevitable due to the complexity of the issues and volume of evidence; and (c) the accused was not
prejudiced by the delay.

While the OSP exceeded the time limit of 60 days, the OSP on two occasions sought additional time to complete the
preliminary investigation. The Sandiganbayan, on the other hand, is responsible for the delay. There was nothing complex about
the issues presented in the Compliance with Omnibus Motion to justify a timeline of more than a year to resolve it. Lastly,
Desembrana vigorously participated in the proceedings before the Sandiganbayan and filed his share of pleadings. His motions and
pleadings likewise contributed to the delay in this case. It is reasonable to infer from these circumstances that Desembrana suffered
no damage as a result of the delay.

FACTS
Raul Desembrana (Desembrana) was charged with two (2) counts of violation of Republic Act No.
6713, otherwise known as Code of Conduct and Ethical Standards for Public Officials and Employees.
Desembrana filed a Motion to Suspend Arraignment with the Sandiganbayan to accommodate the Motion to
Conduct Preliminary Investigation he had filed with the Office of the Special Prosecutor (OSP) on November
20, 2014.

On July 8, 2015, the Sandiganbayan directed the OSP to conduct a full and complete preliminary
investigation within sixty (60) days from notice. On two separate (2) occasions, the OSP filed a Motion for
Extension of Time to Terminate a Complete and Full Preliminary Investigation of these Cases. Desembrana
manifested that he filed a Rejoinder-Affidavit with the OSP.

On September 29, 2015, the OSP issued a recommendation finding probable cause against
Desembrana for violation of Article 210 of The Revised Penal Code and requesting for the withdrawal of the
information in the initial criminal case and the substitution of the relevant Information in place thereof. The
Ombudsman approved the recommendation in its Resolution.

On November 10, 2015, the OSP filed with the Sandiganbayan its Compliance with Omnibus Motion
and for the Lifting of the Resolution.

Desembrana filed his Motion to Dismiss stating his right to speedy disposition of cases was allegedly
violated. Desembrana pointed out that two (2) years and two (2) months had lapsed from the Sandiganbayan’s
directive on November 20, 2014 for the OSP to terminate the preliminary investigation within sixty (60) days
from notice.

The Sandiganbayan granted Desembrana’s motion to dismiss by reason of the unreasonable length of
time in the conduct of preliminary investigation by the OSP. The Sandiganbayan stated in its decision that the
prosecution claims that the delay is caused by lack of compliance on the part of Desembrana to the procedural

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rule of the Office of the Ombudsman, specifically Section 7(a), Rule II thereof which states that the filing of a
motion for reconsideration requires leave of court in cases where an information has already been filed in court,
as in the instant case.

The Sandiganbayan further held that such ratiocination is misleading. The Sandiganbayan granted leave
of court when it issued its Resolution on July 8, 2015 directing the prosecution to conduct a full and complete
preliminary investigation and defining the same in clear and unequivocal terms, consistent with the
pronouncement of the Supreme Court in Sales v. Sandiganbayan that under the existing rules of the Office of the
Ombudsman, the grant of a motion for reconsideration is an integral part of the preliminary investigation
proper.

ISSUE
Did the Sandiganbayan Sandiganbayan gravely abuse its discretion in dismissing the complaints by
reason of an alleged inordinate delay?

RULING
YES. First, elementary circumspection would have instructed the Sandiganbayan that the Court had
already restricted the Sales ruling only to the preliminary investigation of Ombudsman cases under the then
Section 7 of the Ombudsman Rules of Procedure. Elementary diligence would also have dictated to the
Sandiganbayan that the Section 7 referenced in Sales has long been amended.

Clearly, unlike in the old Section 7 upon which Sales was based, the governing Section 7 no longer bars
the Office of the Ombudsman or more properly the OSP from filing the Information with the Sandiganbayan.
As a result, it stands to reason that preliminary investigation as a matter of right is full and complete immediately
after the opportunity to hear the parties and the finding of probable cause, since at that stage the Information
may already be filed with the Sandiganbayan, without awaiting either the filing or the lapse of the period for
filing any motion for reconsideration or reinvestigation, or if one has been filed, the resolution thereof. Further,
once the Information has been filed with the Sandiganbayan, action by the OSP on the motion for
reconsideration or reinvestigation is no longer a matter of right but a privilege, as the Sandiganbayan has to
grant leave to the OSP in order for it to act on the motion for reconsideration or reinvestigation.

Second. To determine whether a respondent’s right to a speedy disposition of cases, the case of Martin
v. Ver adopted the balancing test laid down in the U.S. case of Barker v. Wingo. The balancing test compels the
courts to approach cases on an ad hoc basis, with the conduct of both the prosecution and defendant weighed
using the four-fold factors: (a) the length of the delay; (b) reason for the delay; (c) defendant’s assertion or non-
assertion of his right; and (d) prejudice to the defendant resulting from the delay. These factors are to be
considered together.

Due to the fact that neither the Constitution nor the Ombudsman Act of 1989, provide for a specific
period within which the Ombudsman is mandated to conduct its fact-finding investigations or to act on
complaints, other than “promptly,” what was considered “prompt” or “inordinate delay” was instead given
judicial interpretation, the leading case being Tatad v. Sandiganbayan. Tatad held that: the finding of inordinate
delay applies on a case-to-case basis; political motivation is one of the circumstances to consider in determining
inordinate delay; and that because of the attendant political color, the delay of three years in the termination of
the preliminary investigation was inordinate. Thus, to determine whether or not there was inordinate delay,

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cases were consistently approached by the Court on an ad hoc basis using the combination of Tatad and the
Barker four-fold test.

The guidelines to be observed in resolving the instant case are: If the delay occurs beyond the given
time period and the right is invoked, the prosecution has the burden of justifying the delay. The prosecution
must prove: (a) that it followed the prescribed procedure in the conduct of preliminary investigation and case
prosecution; (b) the delay was inevitable due to the complexity of the issues and volume of evidence; and (c)
the accused was not prejudiced by the delay.

This is because the Sandiganbayan has set the time-limit of 60 days from its directive to conduct a
preliminary investigation. Additionally, it must be stressed that the determination of the length of delay is never
mechanical.

In the case at bar, the timeline started on July 8, 2015 and the deadline for the completion of the
preliminary investigation was pegged initially on September 11, 2015. While the OSP exceeded the time limit
of 60 days, the OSP on two occasions sought additional time to complete the preliminary investigation. These
motions were neither opposed by Desembrana nor rebuffed by the Sandiganbayan. They were therefore
deemed granted. Moreover, Desembrana was himself a party to this delay because up until September 3, 2015,
he was still filing a Rejoinder-Affidavit with the OSP.

On September 29, 2015, the OSP completed the preliminary investigation by finding probable cause
against Desembrana for violation of Article 210 of The Revised Penal Code, and requesting for the withdrawal
of the information in the initial criminal case and the admission of the relevant Information in lieu thereof. The
Office of the Ombudsman approved the recommendation. On November 10, 2015, the OSP filed with the
Sandiganbayan its Compliance with Omnibus Motion and for the Lifting of the Resolution.

All in all, from July 8, 2015 to November 10, 2015, in less than 120 days, the OSP was able to complete
the preliminary investigation. On its face, and especially with the circumstances driving this preliminary
investigation, the Court cannot say that the timeline of 120 days constituted inordinate delay. It is a very
reasonable period to complete a preliminary investigation.

After the OSP filed its Compliance with Omnibus Motion and for the Lifting of the Resolution, the
Sandiganbayan procrastinated for over a year to resolve this Compliance with Omnibus Motion.

Three things stand out from the foregoing trajectory of timelines.

For one, the Sandiganbayan is responsible for the delay. There was nothing complex about the issues
presented in the Compliance with Omnibus Motion to justify a timeline of more than a year to resolve it. By
exercising ordinary diligence, the Sandiganbayan could have decided the motion within just a week, as in fact it
was able to issue its Resolution just two weeks from the end of our famous long and festive holiday break in
December. In any event, as explained above, the Sandiganbayan gravely abused its discretion in blindly relying
upon Sales to justify its ruling or stance that “we did not have to tell you so,” as regards the leave of court for
the OSP to resolve Desembrana’s motion for reconsideration.

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For another, Desembrana did not assert his right to the speedy disposition of his cases during the
impasse at the Sandiganbayan. From November 2015 to January 2017, Desembrana sat idly by, which to us in
hindsight smacks of traces of bad faith, because he waited in ambush. Moreover, though the proceedings were
sluggish, Desembrana was given every opportunity to be heard. Desembrana vigorously participated in the
proceedings before the Sandiganbayan and filed his share of pleadings. His motions and pleadings likewise
contributed to the delay in this case. It is reasonable to infer from these circumstances that Desembrana suffered
no damage as a result of the delay.

Lastly, the Sandiganbayan gravely abused its discretion not only in imputing blame to the OSP for the
delay on the basis of an inapplicable case law, but also in failing to move the case forward upon the lapse of
the period to conduct preliminary investigation.

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ANGKLA: ANG PARTIDO NG MGA PILIPINONG MARINO, INC. (ANGKLA) and SERBISYO
SA BAYAN PARTY (SBP) v. COMMISSION ON ELECTIONS, et al.
G.R. No. 246816, 15 September 2020, EN BANC (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

Although directly conferred by the Constitution, the power of judicial review is not without limitations. It requires
compliance with the following requisites: (1) an actual case or controversy calling for the exercise of judicial power; (2) the person
challenging the act must have legal standing to challenge; he or she or it must have a personal and substantial interest in the case
such that he or she or it has sustained, or will sustain, direct injury as a result of the assailed measure’s enforcement; (3) the question
of constitutionality must be raised at the earliest possible opportunity; and (4) the issue of constitutionality must be the very lis mota
of the case.

In the issue at hand, ANGKLA and SBP failed to meet the third requisite for judicial review. RA 7941 was enacted
in 1995 and it was in 2009 when the Court settled the interpretation of Section 11 (b) in BANAT. For ANGKLA, SBP,
and AKMA-PTM now to question the constitutionality of the assailed proviso not only came too late in the day, but also reeks of
inconsistent positions and double standard which negate the presence of the third requisite of judicial review.

FACTS
This case assails the constitutionality of Section 11 (b), Republic Act No. (RA) 7941 1 insofar as it
provides that those garnering more than two-percent (2%) of the votes cast for the party list system shall be
entitled to additional seats in proportion to their total number of votes.

ANGKLA: Ang Partido ng mga Pilipinong Marino, Inc., (ANGKLA) and Serbisyo sa Bayan Party
(SBP) (ANGKLA and SBP), and Petitioner-in-Intervention Aksyon Magsasaka-Partido Tinig ng Masa (AKMA-
PTN), essentially assert that the allocation of additional seats in proportion to a party-list’s “total number of
votes” results in the double-counting of votes in favor of the two-percenters. For the same votes which
guarantee the two-percenters a seat in the first round of seat allocation are again considered in the second
round. The proviso purportedly violates the equal protection clause, hence, is unconstitutional.

ANGKLA and SBP; therefore, pray that Commission on Elections (COMELEC) be enjoined from
double-counting the votes in favor of the two-percenters. Instead, the 2% votes counted in the first round
should first be excluded before proceeding to the second round of seat allocation. ANGKLA and SBP’s
proposed framework is allegedly consistent with the Court’s Resolution in Barangay Association for National
Advancement and Transparency (BANAT) v. COMELEC (BANAT).

ISSUES
(1) Is Section 11 (b) of RA 7941 allocating additional seats to party-lists in proportion to their total
number of votes unconstitutional?
(2) Is the advantage given to the two-percenters violative of the equal protection clause?

RULING
(1) NO. Although directly conferred by the Constitution, the power of judicial review is not without
limitations. It requires compliance with the following requisites: (1) an actual case or controversy calling for the
exercise of judicial power; (2) the person challenging the act must have legal standing to challenge; he or she or
it must have a personal and substantial interest in the case such that he or she or it has sustained, or will sustain,

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direct injury as a result of the assailed measure's enforcement; (3) the question of constitutionality must be
raised at the earliest possible opportunity; and (4) the issue of constitutionality must be the very lis mota of the
case.

In the issue at hand, ANGKLA and SBP failed to meet the third requisite for judicial review. RA 7941
was enacted in 1995. In 2009, the Court settled the interpretation of Section 11 (b) in BANAT. The Court takes
judicial notice of the fact that, thereafter, ANGKLA was proclaimed as a winning party-list organization in the
2013 and 2016 party-list elections. On the other hand, SBP garnered enough votes to secure a congressional
seat in 2016. ANGKLA and SBP had therefore benefited from the BANAT doctrine in the previous elections.
For ANGKLA, SBP, and AKMA-PTM now to question the constitutionality of the assailed proviso not only
came too late in the day, but also reeks of inconsistent positions and double standard which negate the presence
of the third requisite of judicial review.

(2) NO. All votes, whether cast in favor of two-percenters and non-two-percenters, are counted once.
The perceived “double-counting of votes” does not offend the equal protection clause. Instead, it is an
advantage given to two-percenters based on substantial distinction that the rule of law has long acknowledged
and confirmed.

The Court further discusses as to why the advantage given to the two-percenters is violative of the
equal protection clause in the following: first, the principle of “one person, one vote.” ANGKLA and SBP foist
the idea that only the votes of the two-percenters were counted and considered in the first round which is
inaccurate. All votes were counted, considered and used during the first round of seat allocation, not just those
of the two-percenters. But in the end, the non-two-percenters simply did not meet the requisite voting threshold
to be allocated a guaranteed seat.

Second, the rule of law has already acknowledged and confirmed the substantial distinction between
two-percenters and non-two-percenters. The distinction between two-percenters and non-two-percenters has
long been settled in Veterans Federation Party v. COMELEC (Veterans) where the Court affirmed the validity of
the 2% voting threshold. Veterans further included the rationale behind the voting threshold and differential
treatment which goes all the way to the legislative deliberations. The Veterans formula, which excluded non-
two-percenters in the allocation of additional seats, was sustained in further jurisprudence.

And finally, the ruling in BANAT did not remove the distinction between two-percenters and non-
two percenters. In BANAT, as a result of the other parameters which have to be considered in determining
ultimately the composition of party-list representation in the House of Representatives, the Court declared the
2% threshold as unconstitutional but only insofar as it makes the 2% threshold as exclusive basis for computing
the grant of additional seats. To stress, the nullification of the 2% threshold for the second round was not
meant to remove the distinction between two-percenters and non-two-percenters. Rather, the rationale for the
second round was to fulfill the constitutional mandate that the party-list system constitute 20% percent of the
total membership in the House of Representatives, within the context of the rule of proportionality to the total
number of votes obtained by the party, organization, or coalition. Otherwise, it would be mathematically
impossible if only the 2% threshold and the three-seat cap were the considerations in place for determining a
party-list seat in Congress. As a result, in compliance with the 20% constitutional number, the Court in BANAT
opened the allocation of additional seats even to non-two-percenters.

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PEOPLE OF THE PHILIPPINES v. SUNDARAM MAGAYON Y FRANCISCO

G.R. No. 238873, 16 September 2020, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The search warrant described the place to be searched with sufficient particularity as required by the Constitution.
Section 2, Article III of the 1987 Constitution reads as follows, “The right of the people to be secure in their persons, houses,
papers, and effects against unreasonable searches and seizures of whatever nature and for any purpose shall be inviolable, and no
search warrant or warrant of arrest shall issue except upon probable cause to be determined personally by the judge after examination
under oath or affirmation of the complainant and the witnesses he may produce, and particularly describing the place to be searched
and the persons or things to be seized.”

The rule is that a description of the place to be searched is sufficient if the officer with the warrant can, with reasonable
effort, ascertain and identify the place intended and distinguish it from other places in the community. Any designation or description
known to the locality that points out the place to the exclusion of all others, and on inquiry, leads the officers unerringly to it,
satisfies the constitutional requirement. A search warrant is deemed to have described the place to be searched with sufficient
particularity when the premises have been identified as being occupied by the accused.

As aptly found by the courts below, the search warrant here stated that the place to be searched was Magayon’s “rented
residence and its premises located [on] 6th Street, Guingona Subdivision, Barangay 25, Jose P. Rizal, Butuan City.” The
apprehending officers became and were in fact familiar with the place to be searched as a result of the test buy which they had
conducted just hours before the search. Further, Magayon has not denied that the store formed part of the “rented residence” and
was not a separate structure.

FACTS
Police officers conducted a buy-bust operation in the residence of Sundaram Magayon (Magayon). One
of the police officers, PO2 Maderal accompanied the confidential asset to the store which was part of
Magayon’s house. When the officer saw the asset exchanged marked money with a teabag-sized packet of
alleged marijuana from Magayon, he arrested the latter.

The poseur-buyer handed the packet of marijuana to PO2 Delos Santos, who gave it to PO2 Maderal
for safekeeping. He got the marked money from Magayon’s “wife” who received it from Magayon after the
transaction. He and the other officers then informed Magayon that he was under arrest for illegally selling
marijuana. SPO4 Amora informed Magayon about the search warrant. They waited for barangay officials and
media personnel to arrive before conducting the search. Magayon and his “wife” were also present when the
house was being searched. Seventy-four (74) packets of marijuana were found in different parts of Magayon’s
house.

An inventory of the items was also performed in the presence of Magayon and barangay officials. PO2
Maderal prepared the certificate of orderly search, which was signed by witnesses from the barangay and the
media. However, Magayon refused to sign. Magayon and his “wife” were then brought to the police station for
investigation. The items were then delivered to the PNP Crime Laboratory on the same day.

A barangay kagawad testified that a police officer came to her house and requested to witness a raid
that he and his companions were about to conduct. When she arrived, police officers and a barangay kagawad

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were already present. Only then did the search commence. After the search and seizure, the police officers
made an inventory and took photographs of the items.

A forensic chemist testified that he received three laboratory requests from a Police Chief Inspector
(PCI) regarding the buy-bust operation. The items were tested and were found to be positive for marijuana.
The items also contained markings which the chemist personally inscribed upon receiving them.

The Regional Trial Court (RTC) found Magayon guilty of violating Section 11 of R.A. 9165. This was
affirmed by the Court of Appeals (CA).

ISSUES
(1) Was the search conducted valid?
(2) Is Magayon guilty of violating Sec. 11 of R.A. 9165?

RULING
(1) YES. The search warrant described the place to be searched with sufficient particularity as
required by the Constitution. Section 2, Article III of the 1987 Constitution reads as follows, “The right of the
people to be secure in their persons, houses, papers, and effects against unreasonable searches and seizures of
whatever nature and for any purpose shall be inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge after examination under oath or
affirmation of the complainant and the witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized.”

The rule is that a description of the place to be searched is sufficient if the officer with the warrant can,
with reasonable effort, ascertain and identify the place intended and distinguish it from other places in the
community. Any designation or description known to the locality that points out the place to the exclusion of
all others, and on inquiry, leads the officers unerringly to it, satisfies the constitutional requirement. A search
warrant is deemed to have described the place to be searched with sufficient particularity when the premises
have been identified as being occupied by the accused.

As aptly found by the courts below, the search warrant here stated that the place to be searched was
Magayon’s “rented residence and its premises located [on] 6th Street, Guingona Subdivision, Barangay 25, Jose
P. Rizal, Butuan City.” The apprehending officers became and were in fact familiar with the place to be searched
as a result of the test buy which they had conducted just hours before the search. Further, Magayon has not
denied that the store formed part of the “rented residence” and was not a separate structure.

The Court likewise ruled that the police officers fully complied with the Rules of Court on the
conduct of a valid search. Section 8 of Rule 126 states that “No search of a house, room, or any other premises
shall be made except in the presence of the lawful occupant thereof or any member of his family or in the
absence of the latter, two witnesses of sufficient age and discretion residing in the same locality.”

Although Magayon does not dispute the fact that there were at least two (2) witnesses who were present
during the search, he asserts that he himself did not witness it. This claim, however, is belied by the categorical
testimonies of the prosecution witnesses PO2 Maderal and Barangay Kagawad Mangasep that he and his

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girlfriend/common law wife were actually present during the search. The Court of Appeals, too, aptly noted
that Magayon himself testified that he witnessed the search conducted by the police.

Lastly, Magayon’s failure to object to the search warrant and the evidence adduced below precludes
him from belatedly interposing his objections in the present proceedings. It is a matter of record that Magayon
never assailed the search warrant and the evidence emanating therefrom before the trial court. As the appellate
court correctly observed, Magayon’s objections were belatedly raised on appeal and, thus, are deemed waived.

(2) YES. The evidence on record shows that Magayon did have dominion and control over the
place of subject of the search. The elements of illegal possession of dangerous drugs under Section 11, Article
II of RA 9165 are:
(1) possession by the accused of an item or object identified to be a prohibited drug;
(2) the possession is not authorized by law; and
(3) the free and conscious possession of the drug by the accused.

Possession under the law includes not only actual possession but also constructive possession. Actual
possession exists when the drug is in the immediate physical possession or control of the accused. On the other
hand, constructive possession exists when the drug is under the dominion and control of the accused or when
he has the right to exercise dominion and control over the place where it is found. Exclusive possession or
control is not necessary. The accused cannot avoid conviction if his control and dominion over the place where
the contraband is located were shared with another.

It was plainly stated in Magayon’s own counter-affidavits that he resided in the address specified in the
search warrant and where the search was actually conducted. Specifically, in his Counter-Affidavit dated August
14, 2004, he stated that he and Cheche were live-in partners. Although, on the witness stand, Magayon
subsequently disavowed certain portions of his counter-affidavits, the recanted statements did not include
Magayon’s address nor the fact that he and Cheche were living together.

Magayon’s inculpatory admissions sustain his conviction and Section 21, Article II of R.A. 9165 will
not come into play. Records indubitably show that Magayon had frankly admitted his possession of the
enormous amount of prohibited drugs which were found in and seized from his residence. Clearly, Magayon
knowingly took full responsibility for the seized drugs in his counter-affidavits.

Extrajudicial confessions are admissible in evidence, provided they are: (1) voluntary; (2) made with
the assistance of a competent and independent counsel; (3) express; and (4) in writing.

Here, Magayon’s admissions in his counter-affidavits are binding on him as they were knowingly and
voluntarily made with assistance of his counsel of choice.

On this score, the Court of Appeals correctly took into account that Magayon was not an unlettered
person but was a third year college student majoring in Elementary Education; hence, he readily understood
the statements in his counter-affidavits and could have refused to sign them if they were untrue. He did not
charge his lawyer with incompetence, neglect or impropriety. He did not adduce evidence of coercion or
intimidation from anyone. These counter-affidavits were notarized, the first, by Magayon’s own counsel, and

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the second, by the city prosecutor. It cannot be gainsaid then that Magayon’s extrajudicial admissions can stand
on their own to support a verdict of conviction.

In Regalado v. People, Regalado admitted that he possessed the seized marijuana but contended that the
apprehending officers did not fully comply with Section 21, Article II of RA 9165. The Court held that
Regalado's damning admission warranted the affirmance of his conviction, albeit we sternly reminded police
officers to be mindful of their duty to comply with the statutorily mandated procedure in drugs cases, lest their
lapses become fatal to the prosecution's cause.

Here, Magayon already admitted several times his possession of a large quantity of marijuana and did
not pose substantial objections to the identity and integrity of the drugs confiscated at the place of his arrest.
The case records flatly contradicted his objections to the chain of custody of the seized drugs in question.

Section 21, Article II of RA 9165 on the chain of custody rule outlines the procedure that police officers
must follow in handling the seized drugs in order to ensure the preservation of their integrity and evidentiary
value. To establish the identity of the dangerous drug with moral certainty, the prosecution must be able to
account for each link of the chain of custody from the moment the drugs are seized up to their presentation in
court as evidence of the crime.

Here, the testimonies of PO2 Maderal and the forensic chemist sufficiently established every link in
the chain of custody from the time the prohibited drugs were seized and inventoried right after the search at
the place of the search, to the time they were brought to the police station for the booking, investigation, and
forensic analysis, up until the prohibited drugs were presented in court.

On the marking of the seized items, Magayon himself admitted that the seized drugs were marked and
inventoried at the time and place of the search. Surely, he could not have made such a confirmation if the
marking and inventory had not been made in his presence as required by Section 21.

Further, there is no law or rule requiring that the inventory should segregate the seized items according
to the specific place in the house or store where they were found. The law simply and solely mandates that an
inventory of all the seized items be made by the apprehending officer/team. Notably, Magayon himself
admitted in court that the items subject of the inventory as photographed by the police officers were indeed
recovered from the place where the search and arrest were made.

In sum, Magayon admitted the identity and integrity of the drugs seized from his residence and those
presented in court, although Magayon did not specify the exact quantity or amount of drugs. In his Counter-
Affidavit, he categorically admitted that the police found the prohibited drugs in his residence. Five (5) months
later, he admitted the prohibited drugs were found in his possession and for his personal use in his second
Counter-Affidavit.

Magayon categorically stated that he knew the consequences of his admissions. He was even assisted
by counsel when he affixed his signature on his counter-affidavit. As the final nail in the coffin, Magayon even
stressed in open court that he was not a pusher but only a user. These admissions are already sufficient to
establish that he indeed illegally possessed the prohibited drugs.

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It is immaterial that Magayon's counter-affidavit did not specify the amount of drugs found in his
possession. This does not negate the applicability of Regalado. A plain reading of his second counter-affidavit
readily shows that he admitted to owning all 381.3065 grams of marijuana recovered during the search. Notably,
when he executed his second counter-affidavit, about six (6) months after he got arrested, he already knew by
then that he was being charged with illegal possession of 381.3065 grams of marijuana. Yet he still admitted
ownership thereof without qualification as to its quantity.

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POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT CORPORATION (PSALM)

and THE CONCERNED AND AFFECTED OFFICERS AND EMPLOYEES OF PSALM. v.
COMMISSION ON AUDIT
G.R. No. 205490, 22 September 2020, EN BANC, (LAZARO-JAVIER, J.)

POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT CORPORATION (PSALM)

and THE CONCERNED AND AFFECTED OFFICERS AND
EMPLOYEES OF PSALM. v. COMMISSION ON AUDIT
G.R. No. 218177, 22 September 2020, EN BANC, (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

In the very recent case of Madera, et al. v. COA, the Court En Banc, discussed in detail the respective liabilities of
certifying and approving officers and the recipient employees in case of expenditure disallowance. It stated that the civil liability under
Sections 38 and 39 of the Administrative Code of 1987, including the treatment of their liability as solidary under Section 43,
arises only upon a showing that the approving or certifying officers performed their official duties with bad faith, malice or gross
negligence. For errant approving and certifying officers, the law justifies holding them solidarity liable for amounts they may or may
not have received considering that the payees would not have received the disallowed amounts if it were not for the officers' irregular
discharge of their duties, xxx This treatment contrasts with that of individual payees who xxx can only be liable to return the full
amount they were paid, or they received pursuant to the principles of solutio indebiti and unjust enrichment.

Applying the law and Madera here, the Court held that the members and officers of the PSALM Board of Directors
who authorized the payment of the disallowed amounts and the employees who received the same are liable to return them.

FACTS
Administrative Order No. 402 (AO 402), series of 1998 entitled establishment of a Medical Check-Up
Program for Government Personnel provides an annual medical check-up for government officials and
employees is hereby authorized to be established starting this year, in the meantime that this benefit is not yet
integrated under the National Health Insurance Program being administered by the Philippine Health Insurance
Corporation (PHIC). The medical check-up program shall be granted to all permanent and temporary personnel
of national government agencies who have been in the service for at least one year as of the effectivity of this
Order.

In accordance with these directives, PSALM Board of Directors approved Board Resolution No. 06-
46 regarding the Health Maintenance Program for PSALM officials and employees as recommended by PSALM
Management. One year later, PSALM Board of Directors approved the grant of additional medical benefits per
Board Resolution authorizing the continuation of the aforesaid health program but with additional components,
i.e., purchase of emergency over-the-counter drugs and prescription drugs, dental and optometric medications,
and reimbursement of expenses on emergency and special cases.

In yet another Board Resolution in 2008, PSALM Board of Directors further expanded the health
program to include the Members of the Board of Directors and Board Review Committee themselves and their
respective alternates, and to increase the allotted funds for the health program.

State Auditor IV Gina Maria P. Molina (Auditor Molina) issued her Audit Observation Memorandum
stating that the medical assistance benefits included in PSALM's expanded 2008 Medical Assistance Benefit

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(MAB) lacked legal and factual bases. She proceeded to issue Notice of Disallowance (ND) No. 2008-002
(2008) dated April 23, 2009 in the total amount of P5,702,517.42.

On PSALM’s appeal to COA-Office of the Cluster Director, Corporate Government Sector (CGS) -
Cluster B, the latter affirmed the disallowance of the 2008 and 2009 expanded MABs. In both cases, CGS
brought to fore that AO 402 only provided for the grant of annual medical check-up for government employees.
The use of the disjunctive "or" meant the office may avail of one (1) benefit only, either a free medical check-
up or supplementary medical allowance to its employees. Moreover, AO 402 provided for medical services to
government employees only, in view of the records that medical services were also given ultra vires to the
employees' dependents. Further, Section 3, AO 402 allowed an increase of benefits only upon availability of
funds.

On PSALM’s further appeal to the COA-Commission Proper (COA-CP), it too, affirmed the
disallowance of the 2008 MAB. In both cases, the COA-CP emphasized that the notices of disallowance only
pertained to the additional aspects of the Health Program, i.e., purchase of prescription drugs, reimbursement
of expenses for emergency or special cases, and the expenses for the employees' dependents.

ISSUES
(1) Did the COA-CP act with grave abuse of discretion when it affirmed the disallowance of the 2008
and 2009 expanded Medical Assistance Benefits (MABs) paid to PSALM officers, employees, and
their dependents?
(2) Are the PSALM officers who authorized the MABs and the employees who received them liable
to return the disallowed amount?

RULING
(1) NO. The 2008 and 2009 expanded MABs per Board Resolution are devoid of legal basis.

Section 1 of AO 402 ordains the establishment of an annual medical check-up program only.
"Medical check-up" contemplates a procedure which a person goes through to find out his or
her state of health, whether he or she is inflicted or is at risk of being inflicted with ailment or
ailments as the case may be. This is precisely why AO 402 ordains a health program specifically
including the following diagnostic procedures, i.e., physical examination, chest x-ray, routine
urinalysis and fecalysis, complete blood count, and electrocardiogram.

The COA-CP correctly held that this standard ought to be strictly followed by every GOCC not only
in the initial grant of medical benefits but also in any subsequent increase thereof upon availability of funds,
thus:

It is very clear that the medical benefit extended under A.O. 402 is a limited benefit confined
to a medical check-up program consisting of procedures that are strictly diagnostic. Nothing
in A.O. 402 refers to a prescription drug benefit, a right to reimbursement for hospitalization,
or indeed for any procedure or regimen that treats rather than diagnoses an illness.

While it is true that Section 3 allows the GOCCs to increase the initial grant of medical benefits to
these employees, the increase depends on availability of funds. As for the 2008 MAB, however, PSALM have

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not refuted the finding of the COA-CP that PSALM's 2008 Corporate Operating Budget from which the 2008
MAB was sourced had an approved allocation of P3,350,000.00 only, way below the total P5,702,517.00
disbursement for the expanded benefits.

While the COA-CP concedes that the initial medical assistance benefits extended to the employees of
the GOCCs may be augmented under Section 3 of AO 402, these augmented benefits must conform with the
principle of ejusdem generis: "where a general word or phrase follows an enumeration of particular and specific
words of the same class or where the latter follow the former, the general word or phrase is to be construed to
include, or to be restricted to persons, things or cases akin to, resembling, or of the same kind or class as those
specifically mentioned.

In this light, the COA-CP argues that the purchase of over the counter drugs, prescription drugs,
payment of consultation fees, reimbursement of expenses on emergency and special cases and situations,
optometric procedures, dental procedures like retainers and braces, and dermatological laser treatments under
the 2008 and 2009 MABs sharply depart from the principle of ejusdem generis pertaining to the category of
diagnostic procedures granted under the Board Resolution.

The health program which AO 402 espouses is intended exclusively for government employees. The
families or dependents of qualified government employees concerned are not included. What is not included is
deemed excluded. Exclusio unius est exclusio alterius.

But as worded, Board Resolution No. 07-67 extended the medical assistance benefits not only to
PSALM's plantilla officers but to their so called qualified dependents as well. Verily, therefore, the grant here
of the expanded medical assistance benefits did not only exceed the benefits authorized under AO 402, but
also the intended beneficiaries. The inclusion of these beneficiaries, too, is devoid of legal basis.

(2) YES. The officers who authorized the MABs and the employees who received them are liable to
return the disallowed amount.

In the very recent case of Madera, et al. v. COA, the Court En Banc, discussed in detail the respective
liabilities of certifying and approving officers and the recipient employees in case of expenditure disallowance,
viz:

xxx the civil liability under Sections 38 and 39 of the Administrative Code of 1987, including
the treatment of their liability as solidary under Section 43, arises only upon a showing that the
approving or certifying officers performed their official duties with bad faith, malice or gross
negligence. For errant approving and certifying officers, the law justifies holding them solidarity liable
for amounts they may or may not have received considering that the payees would not have received
the disallowed amounts if it were not for the officers' irregular discharge of their duties, xxx This
treatment contrasts with that of individual payees who xxx can only be liable to return the full amount
they were paid, or they received pursuant to the principles of solutio indebiti and unjust enrichment.

In the ultimate analysis, the Court, through these new precedents, has returned to the basic premise
that the responsibility to return is a civil obligation to which fundamental civil law principles, such as unjust

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enrichment and solutio indebiti apply regardless of the good faith of passive recipients. This, as well, is the
foundation of the rules of return that the Court now promulgates.

Applying the law and Madera here, the Court holds that the members and officers of the PSALM Board
of Directors who authorized the payment of the disallowed amounts and the employees who received the same
are liable to return them.

Section 38, Chapter 9, Book I, of the Administrative Code expressly states that the civil liability of a
public officer for acts done in the performance of his or her official duty arises only upon a clear showing that
he or she performed such duty with bad faith, malice, or gross negligence. This is because of the presumption
that official duty is regularly performed. Malice or bad faith implies a conscious and intentional design to do a
wrongful act for a dishonest purpose or moral obliquity. Gross neglect of duty or gross negligence, on the other
hand, refers to negligence characterized by the want of even slight care, or by acting or omitting to act in a
situation where there is a duty to act, not inadvertently but wilfully and intentionally, with a conscious
indifference to the consequences, insofar as other persons may be affected.

Here, it cannot be said that members and officers of the Board acted with malice and bad faith in
approving the grant of the benefits later disallowed. As they claimed, they all acted in the honest belief that the
same were due them and the PSALM employees under AO 402. There is also nothing on record to lead the
Court to conclude that they, indeed, granted the excess benefits with a dishonest purpose.

Nevertheless, the Court holds that the approving and certifying officers are guilty of gross negligence.

To reiterate, the provisions of AO 402 are clear and unequivocal. Its singular intention is to grant a
free annual medical check-up program to government employees. It does not imply in any way the grant of
other health benefits outside the free annual medical check-up. It also clearly limited its scope to the government
employees themselves. Nowhere in the provisions of the law were the benefits extended to the dependents of
the government employees. The members and officers of the Board of Directors, however, carelessly expanded
the coverage of the benefits without thought about and without harmonizing the same with the provisions of
AO 402. Worse, they expanded the benefits not only once, but twice - in 2008 and in 2009.

Thereafter, Auditor Molina issued ND No. 2008-002 (2008). From that point onward, the concerned
members and officers of the Board of Directors should have already desisted from granting the expanded
benefits under the 2009 MAB. Standing alone, the prior disallowance of the grant under the 2008 MAB may
not suffice to negate the presumption of regularity in favor of PSALM, but taken with the other badges,
indubitably conveys the presence of gross negligence.

Indeed, the factors, as heretofore discussed, clearly support the finding that the members and officers
of the Board of Directors who approved and authorized the grant of the expanded benefits are liable to return
the disallowed amounts. Pursuant to Section 43, Chapter V , Book VI of the 1987 Administrative Code and
Madera, their liability is joint and several for the disallowed amounts received by the individual employees.

As clarified in Madera, the general rule is that recipient employees must be held liable to return
disallowed payments on ground of solutio indebiti or unjust enrichment as a result of the mistake in payment.
Under the principle of solutio indebiti, if something is received when there is no right to demand it, and it was

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unduly delivered through mistake, the obligation to return it arises. Madera, however, decrees as well that
restitution may be excused in the following instances:

xxx the jurisprudential standard for the exception to apply is that the amounts received by the
payees constitute disallowed benefits that were genuinely given in consideration of services rendered
(or to be rendered)" negating the application of unjust enrichment and the solutio indebiti principle.

Unfortunately for PSALM's employees, none of the exceptions are present in this case. Foremost, the
expanded benefits under the 2008 and 2009 MABs were not given in relation to the employees' functions, nor
were they given as part of performance incentives, productivity pay, or merit increases.

Verily, therefore, the employees must be held liable to return the amounts that they and their
dependents, if any, respectively received. As earlier discussed, the approving and certifying members and
officers of the Board of Directors are jointly and severally liable for the disallowed amounts received by the
individual employees.

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SOCIAL SECURITY SYSTEM v. COMMISSION ON AUDIT

G.R. No. 244336, 06 October 2020, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Chapter V, Book VI of the 1987 Administrative Code provides the following:

Section 43. Liability for Illegal Expenditures. — Every expenditure or obligation authorized or incurred in
violation of the provisions of this Code or of the general and special provisions contained in the annual General
or other Appropriations Act shall be void. Every payment made in violation of said provisions shall be illegal
and every official or employee authorizing or making such payment, or taking part therein, and every person
receiving such payment shall be jointly and severally liable to the Government for the full amount so paid or
received.

In Rotoras v. COA, the Court decreed that officials and officers who disbursed the disallowed amounts are liable to
refund:
(a) when they patently disregarded existing rules in granting the benefits to be disbursed, amounting to gross negligence;
(b) when there was clearly no legal basis for the benefits or allowances;
(c) when the amount disbursed is so exorbitant that the approving officers were alerted to its validity and legality; or
(d) when they knew that they had no authority over such disbursement.

Indeed, the record speaks for itself. Gross negligence amounting to bad faith indelibly characterized the actions here of the
approving and certifying officials who allowed the illegal grant and its payment to the employees. Pursuant to Section 43, Chapter
V, Book VI of the 1987 Administrative Code and Madera, therefore, their liability is joint and several for the disallowed amounts
received by the individual employees.

FACTS
During the calendar years of 2005, 2006, 2007 and 2008, Social Security System (SSS) granted and
released Collective Negotiation Agreement (CNA) incentives paid to the rank-and-file employees of SSS –
Western Mindanao Division (SSS-WMD) in the total amount of P9,333,319.66. This grant of CNA was
grounded on Social Security Commission (SSC) Resolution No. 183. Eventually, State Auditor Anabella Uy
(Auditor Uy) issued a Notice of Disallowance No. 2012-03 (ND No. 2012-03) in the amount of P9,333,319.66.
Auditor Uy held the SSS-WMD Assistant Vice President Rodrigo Filoteo, Arlene Vargas, Ma. Luz Abella
(Approving and Certifying Officers) and all the payees who received the disallowed CAN incentives liable for
the irregular disbursement of government funds.

Aggrieved, the SSS appealed the same to the Commission on Audit (COA) Regional Director Atty.
Roy Ursal (Atty. Ursal). Atty. Ursal affirmed the finding of disallowance of Auditor Uy, holding that there was
no legal basis for such grant and that it contravened existing auditing rules and regulations.

SSS further sought relief from COA Commission Proper. The Commission Proper likewise affirmed
the decision of the COA Regional Office. Hence, the petition before the Court.

SSS argues that it made prior negotiations and consultations with the SSS Employees Union Panels,
Department of Budget and Management (DBM) and other statutory offices on the grant of the CAN incentives.
Further, it asserted that it issued several resolutions providing a similar grant of CNA incentives to SSS officials

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and employees. Moreover, SSS contends that the approving and certifying officers merely performed their
official functions in good faith. Finally, SSS argues that in accord with the principle against unjust enrichment,
the payees themselves should return the disallowed CAN incentives.

On the other hand, COA argues that the failure to comply with existing rules and regulations warranted
the disallowance of the CNA incentives. Moreover, the approving and the certifying officials deliberately
disregarded the aforesaid circular and resolution.

ISSUES
(1) Are the approving and certifying officers liable to return the disallowed amount?
(2) Are the employees/payees who received the grant liable to pay the disapproved amount?

RULING
(1) YES. Chapter V, Book VI of the 1987 Administrative Code provides the following:

Section 43. Liability for Illegal Expenditures. — Every expenditure or obligation

authorized or incurred in violation of the provisions of this Code or of the general
and special provisions contained in the annual General or other Appropriations Act
shall be void. Every payment made in violation of said provisions shall be illegal and
every official or employee authorizing or making such payment, or taking part therein,
and every person receiving such payment shall be jointly and severally liable to the
Government for the full amount so paid or received.

Moreover, Section 38 of the same Chapter provides:

Section 38. Liability of Superior Officers. —

(1) A public officer shall not be civilly liable for acts done in the performance of his
official duties, unless there is a clear showing of bad faith, malice or gross negligence.
(2) Any public officer who, without just cause, neglects to perform a duty within a
period fixed by law or regulation, or within a reasonable period if none is fixed, shall
be liable for damages to the private party concerned without prejudice to such other
liability as may be prescribed by law.
(3) A head of a department or a superior officer shall not be civilly liable for the
wrongful acts, omissions of duty, negligence, or misfeasance of his subordinates,
unless he has actually authorized by written order the specific act or misconduct
complained of.

Finally, Section 39 of the same Chapter likewise provides:

Section 39. Liability of Subordinate Officers. — No subordinate officer or employee

shall be civilly liable for acts done by him in good faith in the performance of his
duties. However, he shall be liable for willful or negligent acts done by him which are
contrary to law, morals, public policy and good customs even if he acted under orders
or instructions of his superiors.

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Significantly, in the very recently promulgated case of Madera, et al. v. COA, the Court discussed in
detail the respective liabilities of certifying and approving officers and the recipient employees in case of
expenditure disallowance, viz.:

x x x the civil liability under Sections 38 and 39 of the Administrative Code of 1987, including
the treatment of their liability as solidary under Section 43, arises only upon a showing that
the approving or certifying officers performed their official duties with bad faith, malice or
gross negligence. For errant approving and certifying officers, the law justifies holding them
solidarily liable for amounts they may or may not have received considering that the payees
would not have received the disallowed amounts if it were not for the officers' irregular
discharge of their duties, x x x. This treatment contrasts with that of individual payees who x
x x can only be liable to return the full amount they were paid, or they received pursuant to
the principles of solutio indebiti and unjust enrichment.

xxx xxx xxx

x x x the Court adopts Associate Justice Marvic M.V.F. Leonen's (Justice Leonen) proposed
circumstances or badges for the determination of whether an authorizing officer exercised the
diligence of a good father of a family:

x x x For one to be absolved of liability the following requisites may be considered:

(a) Certificates of Availability of Funds pursuant to Section 40 of the
Administrative Code;
(b) In-house or Department of Justice legal opinion,
(c) That there is no precedent allowing a similar case in jurisprudence;
(d) that it is traditionally practiced within the agency and no prior disallowance
has been issued; or
(e) with regard the question of law, that there is a reasonable textual
interpretation on its legality.

In the same case, the Court summarized the rules regarding the liability of the certifying and approving
officers and recipient employees, thus:

E. The Rules on Return

In view of the foregoing discussion, the Court pronounces:
1. If a Notice of Disallowance is set aside by the Court, no return shall be required from
any of the persons held liable therein.
2. If a Notice of Disallowance is upheld, the rules on return are as follows:
(a) Approving and certifying officers who acted in good faith, in regular
performance of official functions, and with the diligence of a good father of
the family are not civilly liable to return consistent with Section 38 of the
Administrative Code.
(b) Approving and certifying officers who are clearly shown to have acted in bad
faith, malice, or gross negligence are, pursuant to Section 43 of the

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Administrative Code of 1987, solidarily liable to return only the net

disallowed amount which, as discussed herein, excludes amounts excused
under the following Sections 2c and 2d.
(c) Recipients — whether approving or certifying officers or mere passive
recipients — are liable to return the disallowed amounts respectively received
by them, unless they are able to show that the amounts they received were
genuinely given in consideration of services rendered.
(d) The Court may likewise excuse the return of recipients based on undue
prejudice, social justice considerations, and other bona fide exceptions as it
may determine on a case to case basis.

Applying the law and Madera here, we hold that the approving and certifying officers of the SSS-WMD
who authorized the payment of the disallowed amounts and the employees who received the same are liable to
return them.

Section 38, Chapter 9, Book I of the Administrative Code expressly states that the civil liability of a
public officer for acts done in the performance of his or her official duty arises only upon a clear showing that
he or she performed such duty with bad faith, malice, or gross negligence. This is because of the presumption
that official duty is regularly performed.

In Rotoras v. COA, the Court decreed that officials and officers who disbursed the disallowed amounts
are liable to refund:

(a) when they patently disregarded existing rules in granting the benefits to be disbursed,
amounting to gross negligence;
(b) when there was clearly no legal basis for the benefits or allowances;
(c) when the amount disbursed is so exorbitant that the approving officers were alerted to its
validity and legality; or
(d) when they knew that they had no authority over such disbursement.

Indeed, the record speaks for itself. Gross negligence amounting to bad faith indelibly characterized
the actions here of the approving and certifying officials who allowed the illegal grant and its payment to the
employees. Pursuant to Section 43, Chapter V, Book VI of the 1987 Administrative Code and Madera, therefore,
their liability is joint and several for the disallowed amounts received by the individual employees.

(2) YES. As clarified in Madera, the general rule is that recipient employees must be held liable to
return disallowed payments on ground of solutio indebiti or unjust enrichment, as a result of the mistake in
payment. Under the principle of solutio indebiti, if something is received when there is no right to demand it, and
it was unduly delivered through mistake, the obligation to return it arises. Meanwhile, there is unjust enrichment
when a person unjustly retains a benefit to the loss of another, or when a person retains money or property of
another against the fundamental principles of justice, equity and good conscience.

Notably, in Dubongco v. Commission on Audit, the Court affirmed the disallowance of CNA incentives
sourced out of CARP funds. More, it held that although the payees committed no fraud in obtaining the
disallowed CNA benefits, they are considered trustees of the disallowed amounts. The Court, thus, directed the

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payees to return the CNA benefits they obtained as it is against equity and good conscience to continue holding
on to them.

Madera decreed, however, that restitution may be excused in the following instances:

x x x the jurisprudential standard for the exception to apply is that the amounts received by
the payees constitute disallowed benefits that were genuinely given in consideration of services
rendered (or to be rendered) negating the application of unjust enrichment and the solutio
indebiti principle. As examples, Justice Bernabe explains that these disallowed benefits may be
in the nature of performance incentives, productivity pay, or merit increases that have not
been authorized by the Department of Budget and Management as an exception to the rule
on standardized salaries. In addition to this proposed exception standard, Justice Bernabe
states that the Court may also determine in the proper casebona fide exceptions, depending
on the purpose and nature of the amount disallowed. These proposals are well-taken.

Moreover, the Court may also determine in a proper case other circumstances that warrant
excusing the return despite the application of solutio indebiti, such as when undue prejudice
will result from requiring payees to return or where social justice or humanitarian
considerations are attendant.

Unfortunately for the SSS-WMD employees, none of the exceptions are present in this case. The
disallowed CNA incentives were not given in relation to the employees' functions, nor were they given as part
of performance incentives, productivity pay, or merit increases as in fact the CNA covering the years 2005 to
2008 did not provide for such kinds of incentives. Also, it cannot be said that undue prejudice will result in
requiring the recipient employees to return the disallowed amount. On the contrary, it is the Government that
would be prejudiced if the recipients will not return what they unduly received.

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TERESITA P. DE GUZMAN, et al. v. COMMISSION ON AUDIT

G.R. No. 245274, 13 October 2020, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The Court has returned to the basic premise that the responsibility to return is a civil obligation to which fundamental
civil law principles, such as unjust enrichment and solutio indebiti apply regardless of the good faith of passive recipients.

In this case, the Baguio Water District (BWD) certifying and approving officers who authorized the payment of the
disallowed centennial bonus, and the BWD employees, who received the same, are liable to return the same. AO 103 clearly ordains
that the grant of new or additional benefits to full-time officials and employees has been suspended except for CNA Incentives and
those expressly provided by presidential issuances. Evidently, the grant of centennial bonus does not fall within the exception, hence,
it belongs to the category of suspended benefits.

FACTS
Under Resolution (BR) No. 046-2009, the Baguio Water District (BWD) authorized the grant of
Centennial Bonus to its officers and employees in the amount equivalent to fifty percent (50%) of the
employee’s salary. The bonus was distributed to the recipients on the occasion of the 100th anniversary of the
City of Baguio.

The COA Audit Team, led by Antonieta La Madrid, issued Notice of Disallowance (ND) No. 12-023-
101-(09) on the total amount of P1,233,860.50 granted as centennial bonus to the BWD officers and employees
for being allegedly devoid of legal basis. The COA Audit Team cited Section 3 (b) of Administrative Order
(AO) No. 103 issued by President Gloria Macapagal-Arroyo, suspending the grant of new or additional benefits
to full-time officials and employees. As a consequence of the disallowance, the recipients were each directed to
refund the centennial bonus they received.

Teresita de Guzman, et al. (de Guzman, et al.) appealed to the COA-Cordillera Administrative Region
(COA-CAR). They were joined by the BWD employees. They essentially argued that first, the notice of
disallowance was defective because the same did not bear the supervising auditor’s signature but only that of
the audit team leader. Second, the agency was not covered by the austerity measures embodied in AO 103.
Lastly, the bonus was released to the officers and employees in good faith.

The COA-CAR did not agree with the arguments set forth by de Guzman, et al, which was later
affirmed by the COA En Banc. Hence, the present petition seeking affirmative relief via Rule 64 of the Rules
of Court.

ISSUES
(1) Is ND No. 12-023-101-(09) defective for not bearing the signature of a supervising auditor?
(2) Is the BWD subject to the power of control of the Office of the President?
(3) Are de Guzman, et al liable to refund the full disallowed amount?

RULING
(1) NO. By Memorandum, the OIC Regional Director of COA-CAR expressly authorized Audit Team
Leader Antonieta La Madrid to issue notices of disallowances, albeit without the signature of a supervising
auditor as none was assigned to BWD at that time. Surely, the post audit functions of the COA do not depend

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on the availability of a supervising auditor. In other words, these audit functions are not halted or suspended
simply because an officer or a member of the COA’s audit team has resigned or has not been appointed in the
meantime.

(2) YES. Local water districts are not private corporations but GOCCs. Specifically, a water district is
a GOCC with a special charter since it was created pursuant to a special law, PD 198. Under the Revised
Administrative Code, GOCCs are part of the Executive Department for they are attached to the appropriate
department with which they have allied functions.

Being a water district, the BWD itself is a GOCC, thus, subject to the power of control of the President.
In ZCWD vs. COA, it was held that the amount of per diems granted to the board of directors of local water
districts is subject to the presidential power of control since local water districts are GOCCs.

Undeniably, AO 103 governs the manner by which local water districts like the BWD manage and
handle their finances. Here, the commemorative or centennial bonus granted to the BWD officers and
employees on the occasion of the agency’s 100th anniversary of Baguio City is neither a CNA incentive nor
authorized by a presidential issuance. Its grant, therefore, was devoid of any legal basis.

(3) YES. As discussed in the case of Madera, et al. vs. COA, the civil liability under Sections 38 and 39
of the Administrative Code of 1987, including the treatment of their liability as solidary under Section 43, arises
only upon a showing that the approving or certifying officers performed their official duties with bad faith,
malice or gross negligence. This is because of the presumption that official duty is regularly performed.

Applying the law and the recent case of Madera, the Court thus holds that the BWD certifying and
approving officers who authorized the payment of the disallowed centennial bonus, and the BWD employees,
who received the same, are liable to return the same.

Here, there is no showing, as none was shown that the BWD approving officers acted with malice and
bad faith in approving the release of the centennial bonus to commemorate the City of Baguio’s Centennial
anniversary. Nevertheless, the Court holds that the certifying and approving officers are guilty of gross
negligence. AO 103 clearly ordains that the grant of new or additional benefits to full-time officials and
employees has been suspended except for CNA Incentives and those expressly provided by presidential
issuances. Evidently, the grant of centennial bonus does not fall within the exception, hence, it belongs to the
category of suspended benefits. Consequently, pursuant to Section 43, Chapter V, Book VI of the 1987
Administrative Code and Madera, the liability of the certifying and approving officers is joint and several for
the disallowed amounts received by the individual employees.

As clarified in Madera, the general rule is that recipient employees must be held liable to return
disallowed payments on ground of solutio indebiti or unjust enrichment as a result of the mistake in payment.
Under the principle of solutio indebiti, if something is received when there is no right to demand it, and it was
unduly delivered through mistake, the obligation to return it arises.

Madera, however, decrees as well that restitution may be excused in the following instances: The
jurisprudential standard for the exception to apply is that the amounts received by the payees constitute
disallowed benefits that were genuinely given in consideration of services rendered (or to be rendered) negating

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the application of unjust enrichment and the solutio indebiti principle. As examples, Justice Bernabe explains that
these disallowed benefits may be in the nature of performance incentives, productivity pay, or merit increases
that have not been authorized by the Department of Budget and Management as an exception to the rule on
standardized salaries. In addition to this proposed exception standard, Justice Bernabe states that the Court
may also determine in the proper case bona fide exceptions, depending on the purpose and nature of the
amount disallowed. These proposals are well-taken. Moreover, the Court may also determine in a proper case
other circumstances that warrant excusing the return despite the application of solutio indebiti, such as when
undue prejudice will result from requiring payees to return or where social justice or humanitarian
considerations are attendant.

None of these exceptions are present here. First, the centennial bonus cannot be considered to have
been given in consideration of services rendered or in the nature of performance incentives, productivity pay,
or merit increases. Second, a monetary grant that contravenes the unambiguous letter of the law cannot be
forgone on social justice considerations. Liability arises and should be enforced when there is disregard for the
basic principle of statutory construction that when the law was clear, there should be no room for interpretation
but only application.

Verily, therefore, the employees must be held liable to return the amounts that they had received.

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DEPARTMENT OF TRADE AND INDUSTRY AND ITS BUREAU OF PRODUCT

STANDARDS v. STEELASIA MANUFACTURING CORPORATION
G.R. No. 238263, 16 November 2020, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The doctrine of in pari materia requires that statutes on the same subject be construed together because legislative
enactments are supposed to form part of one uniform system. More, the legislature is supposed to have in mind the existing legislations
in the passage of its acts. Thus, later statutes are deemed supplementary or complementary to earlier enactments.

Verily, there is no substantial difference between the texts of R.A. No. 4109 and R.A. No. 7394 insofar as they
require prior testing, inspection, and certification of product quality and safety as conditions sine qua non to the release of imported
merchandise to the market or in commerce.

FACTS
SteelAsia Manufacturing Corporation (Steelasia) sought to nullify through a petition for declaratory
relief three (3) DTI Regulations. Claiming to be a local manufacturer of steel bars, Steelasia questioned the DTI
Regulations for being in conflict with Republic Act No. 4109 (R.A. No. 4109) and violative of the equal
protection clause.

Specifically, the DTI Regulations allowing the conditional release of imported merchandise from the
Bureau of Customs (BOC) premises prior to compliance with the required testing, inspection, and clearance
are purportedly in conflict with the command of RA 4109 that only those which have been tested, inspected,
and certified may be released. Steelasia further claims that the DTI Regulations are violative of the equal
protection clause for they allow the conditional release of merchandise to international manufacturers and
importers pending compliance with the testing, inspection, and clearance requirements while local
manufacturers are not given the same privilege. This differential treatment does not rest on substantial
distinctions and is not in any way germane to the purpose of the law.

On the other hand, DTI argued that the DTI Regulations allow the conditional physical release of the
merchandise only for the purpose of moving them from the heavily congested BOC premises into a suitable,
safe, secure and accredited warehouse or storage area where the merchandise shall be stored and continue to
be within the control of DTI pending the required product testing and clearance. Further, the DTI Regulations
do not violate the equal protection clause. There are substantial distinctions between imported commodities,
on one hand, and locally manufactured goods, on the other.

The Regional Trial Court (RTC) declared DAO No. 5 and its Implementing Rules and Regulations,
and DAO No. 15-01, ultra vires and with no force and effect. Thereafter, the DTI invoked the Court’s appellate
jurisdiction.

ISSUES
(1) Are the DTI Regulations in conflict with RA 4109 and RA 7394, hence, should be invalidated?
(2) Are the DTI Regulations defective for having exclusively emanated from DTI, sans the involvement
of the Commissioner of Customs?
(3) Are the DTI Regulations violative of the equal protection clause insofar as they apply only to imported
merchandise but not to locally manufactured products?

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RULING
(1) NO. The doctrine of in pari materia requires that statutes on the same subject be construed together
because legislative enactments are supposed to form part of one uniform system. More, the legislature is
supposed to have in mind the existing legislations in the passage of its acts. Thus, later statutes are deemed
supplementary or complementary to earlier enactments.

Notably, RA 4109 is not the sole statute governing the testing, inspection, and certification
requirements implemented by the DTI on imported goods. RA 7394 or the Consumer Act also covers the same
requirement.

Verily, there is no substantial difference between the texts of RA 4109 and RA 7394 insofar as they
require prior testing, inspection, and certification of product quality and safety as conditions sine qua non to
the release of imported merchandise to the market or in commerce. This requirement is intended to prevent
substandard products from getting released to the market and eventually falling into the hands of innocent
consumers regardless of the nature of the merchandise, whether they be consumer’s products or services or
otherwise. On this score, the distinction being raised by Steelasia as to the kind of imported products governed
by RA 4109, on one hand, and those by RA 7394, on the other, has no bearing at all on the required testing,
inspection, and certification of product quality and safety prior to the release of any kind of imported products
to the market or in commerce. Both laws are in pari materia and ought to be applied together on all imported
merchandise.

Here, not only are the aforementioned provisions complete in their respective terms, but each of them
also contains sufficient standards for the DTI to determine how the ICC requirement shall be processed,
including the preparatory steps for the discharge this particular duty such as where the imported products shall
be stored in the meantime. While this is not expressly stated in the statutes, this is necessarily implied from the
principal mandate given to the DTI for the issuance or non-issuance of the ICC. The DTI does not have to do
anything except implement the provisions based on the standards and limitations provided by the statutory
provisions, the details of such implementation being left of necessity to the DTI to determine.

The present challenge focuses on Section 4.1.1.1 of DAO No. 5 allowing conditional release from
BOC’s custody of imported goods that have yet to be tested, inspected, and certified provided the importer
shall have already complied with the BOC’s requirements and any other requirements of the DTI. To
emphasize, it is a mere preparatory step to the principal mandate for the ICC issuance or denial, a portion of
the detail in the implementation of Section 15 of RA 7394 and Section 4 (d) of RA 4109. The purpose is to
provide swift and effective solutions to the very real problems of delays in shipment release, port congestion,
and storage costs brought about by the increasing importations vis-a-vis the rapidly developing global industry.

As aptly argued by the OSG, conditional release does not pertain to the release of imported goods to
the market or in commerce, but only to its physical transfer or movement from the BOC premises to a suitable,
secure, safe, and accredited warehouse or storage space pending compliance with the requisite testing,
inspection, and certification. These procedures shall no longer be performed within the congested BOC
premises but in the testing center or laboratory using samples from the materials that are safely secured in the
storage facility pending clearance of all the necessary approvals.

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It is not true that the conditional release of the merchandise from the BOC premises to a suitable, safe,
and secure accredited warehouse or storage space effectively skips the requirements of testing, inspection, and
clearance under RA 4109. On the contrary, it paves the way for an efficient, convenient, and expeditious process
of testing, inspection, and certification of the merchandise. It thus ensures that only those imported goods that
have passed the DTI’s standard of safety and quality are released to the market for sale, disposition, or
distribution to consumer.

Insofar as the steel industry is concerned, conditional release is imperative since doing the BPS
inspection and certification right inside the customs premises is highly impractical, if not impossible primarily
due to its limited space. Not only that. Since the prescribed procedure requires the installation of highly
specialized equipment and machinery in a laboratory, at present, it can only be done by the lone testing center
for steel bars in the country, the MIRDC of the DOST inside its laboratory in Bicutan.

To be sure, Steelasia itself does not deny that the DTI’s policy of allowing the conditional release of
imported merchandise was impelled by considerations of convenience and efficiency. It does not deny either
that the BOC premises are highly congested. Nor does it deny that there is only one testing facility (MIRDC)
servicing all demands for testing, inspection, and certification of steel bars and that conducting an actual and
thorough testing in the congested BOC premises is extremely difficult as it even affects the quality of the testing
process. Notably, the trial court opined that it is the government’s duty to provide a testing facility within the
BOC area itself. But for this facility to get constructed, the government has to reckon with several factors such
as the availability of funds, space, manpower, among others. Meantime, the government has to deal with the
fact that there is but a single testing center available in the country which, much as it wants to, cannot do the
testing and inspection on all shipments inside the BOC premises all at the same time.

The assailed DTI Regulations thus puts context to the conditional release of merchandise. Based
thereon, the warehouse or storage area where the imported items are physically transferred will be padlocked,
limiting access thereto to authorized personnel only. Also, the shipment shall be sealed prior to testing,
inspection, and certification for the purpose of ensuring against any alteration, movement, or transfer thereof
without the knowledge of BPS or DTI. Finally, the BPS and the DTI are authorized to institute additional
measures to maintain the integrity of this process.

Clearly, while the imported goods may have been released from the physical custody of the BOC to an
accredited warehouse, their security and integrity are nevertheless preserved. Similar to the judicial concept of
custodia legis over items in litigation, the DTI retains control over the imported commodities to ensure that
substandard materials are not altered, sold, transferred, or used at any given time prior to compliance with the
requirements of testing, inspection and certification. Consequently, it cannot be said that the assailed issuances
are arbitrary or contrary to the intent and spirit of the law.

Whether this rule is wise or unwise, the Court does not delve into the policy behind the rule. It is
enough that Executive Order No. 293 has validly delegated the power to promulgate rules to the DTI and the
standards and limitations are set forth in Section 15 of RA 7394 and Section 4 (d) of RA 4109. It is within the
scope of the DTI’s power to determine the preparatory process for the ICC requirement whose requirements
are clearly laid out in the law.

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(2) NO. Verily, Article 15 (c) of RA 7394 covers situations wherein the imported goods nave already
undergone testing and failed the mandatory product standards. In such a case, the goods may still be released
for a maximum of ten (10) days for the limited purpose of alteration or modification to make them compliant.
This is the only instance where the joint promulgation of rules by the DTI and the BOC is required under
Article 15. It does not contemplate scenarios wherein imported goods are simply moved to a warehouse or
storage area before they are sent to testing facilities.

As stated, the law requires the DTI and the BOC to jointly promulgate rules only in cases where the
alteration or modification of the imported goods may be allowed. And rightly so since the integrity of the
imported goods would no longer be preserved in such cases. To repeat, as with any other property in custodia
legis, imported goods pending clearance may not be altered or modified without the imprimatur and compliance
with rules of the agency having custody over them.

At any rate, joint promulgation of rules does not require that the parties signify their concurrence in
the same document. More, the BOC itself even relies on issuances from other departments as regards the
release of imported goods and commodities.

It is, therefore, not inconceivable that there already exists a separate issuance of the BOC governing
the importation of reinforcement steel bars. And in accordance with 4.1.1.1 of DAO No. 5, conditional release
is allowed upon “compliance with the BOC’s requirements and any other requirements of the DTI.”

In fine, the trial court gravely erred when it peremptorily nullified the DTI Regulations due to their
alleged inconsistency with RA 4109. As stated, there is no inconsistency to speak of. The “release” of imported
goods to the market or in commerce under RA 4109 and RA 7394 is not the same as the conditional physical
release and transfer of the goods from the BOC premises to a suitable, secure, safe, and accredited warehouse
or storage space accessible only to authorized DTI persons.

(3) NO. Here, there exists a valid classification between local producers and importers even though
they produce the same goods and commodities.

First, there are substantial distinctions between locally produced merchandise, on one hand, and
imported merchandise, on the other. For one, the former is easily accessible and available to the regulatory
body for inspection and compliance whereas the latter is not. In fact, DTI can only rely on documents issued
by the importers’ foreign counterparts. For another, local manufacturers can access and closely monitor local
channels of distribution more easily, while importers have to go through the tedious importation process before
they could do so.

Second, the differences in testing procedures and guidelines are germane to the purpose of RA 4109
and RA 7394 in protecting consumer interest and trade and industry as a whole. To recall, these statutes
essentially prevent substandard goods from being distributed to the market and eventually used or consumed
by consumers. The different procedures recognize and address the different logistical needs and concerns of
local manufacturers and importers alike.

On one hand, locally manufactured goods are more accessible and can more easily be regulated
throughout the manufacturing process until the inspection and certification of the final product. On the other

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hand, imported goods are allowed to be conditionally released, not for immediate distribution, but only for
temporary storage pending inspection and certification with the necessary safeguards in effect. Without this
flexibility of conditional release, docks and BOC facilities at importation points would easily clog and impede
trade and industry in general. The existing safeguards also prevent the possibility of loosely granting
certifications if only to clear the docks and facilities. Indeed, these differences are germane to the purpose of
protecting trade and industry.

Third, the DTI Regulations contemplate both current and future importations of commodities. In fact,
the inspection and certification procedures under DAO No. 5 are on per shipment per Bill of Lading basis.
Also, the assailed regulations take future amendments of the guidelines into consideration in view of the rapid
developments in trade and industry.

Fourth, DAO No. 4 covers local and foreign companies manufacturing in the Philippines, while DAO
No. 5 applies to all importers of commodities without distinction or limited application to specific companies
or producers. Hence, they apply equally to all members of the same class.

The classification between locally-manufactured and imported is therefore not arbitrary. Indeed, the
DTI Regulations are vital cogs to a grand scheme of administrative machinery without which the bureaucracy
might be hampered if not stalled. The growing complexities of modern life, the multiplication of the subjects
of governmental regulations, and the increased difficulty of administering the law have come to fore, calling for
the need to exercise the vested discretion in administrative agencies and departments, and the promulgation of
rules and regulations calculated to promote public interest, which the DTI here has validly so exercised within
its delegated rule-making power.

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DIOSDADO SAMA Y HINUPAS and BANDY MASANGLAY v. PEOPLE OF THE

PHILIPPINES
G.R. No. 224469, 05 January 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In Saguin v. People, the prohibited act of non-remittance of Pag-Ibig contributions is punishable only when this act was
done "without lawful cause" or "with fraudulent intent." According to this case law, lawful cause may result from a confusing state
of affairs engendered by new legal developments that re-ordered the way things had been previously done. In Saguin, the cause of the
confusion was the devolution of some powers in the health sector to the local governments. The devolution was ruled as a "valid
justification" constituting the "lawful cause" for the inability of the accused to remit the Pag-Ibig contributions. The devolution gave
rise to reasonable doubt as to the existence of the offense's element of lack of lawful cause.

Here, as in Saguin, there was confusion arising from the new legal developments, particularly, the recognition of the
indigenous peoples' (IPs) human rights normative system, in our country. To paraphrase and import the words used in Saguin,
while doubtless there was voluntary and knowing act of cutting, removing, collecting, or harvesting of timber, the Court nonetheless
consider the reasonable doubt engendered by the new normative system that the act was done without State authority, as required by
Section 77 of PD 705, as amended.

FACTS
A team of police officers and Department of Environment and Natural Resources (DENR)
representatives were patrolling Barangay Calangatan, San Teodoro, Oriental Mindoro when they heard the
sound of a chainsaw and a tree falling. They caught Diosdado Sama y Hinupas (Sama) and Bandy Masanglay
(Masanglay) in the act of cutting a dita tree. The team asked Sama and Masanglay if they had license to cut the
tree to which they answered in the negative. After informing them of their violation, the team brought Sama
and Masanglay to the police station.

For the defense, Barangay Captain Rolando Aceveda (Barangay Captain Aceveda) said that Sama and
Masanglay were members of the Iraya-Mangyan indigenous peoples (IPs). They told him that the cutting down
of the tree was for the construction of the Iraya-Mangyan IPs’ community toilet. He was aware of the
construction and that the dita tree was planted within the ancestral domain of the Iraya-Mangyan IPs.

The Regional Trial Court (RTC) found Sama and Aceveda guilty of violating Presidential Decree 705
(P.D. 705), also known as the Revised Forestry Code of the Philippines.

The Court of Appeals (CA) affirmed the conviction and held that Sama and Masanglay failed to show
proof that they were Iraya-Mangyan IPs and that the dita tree was part of their ancestral domain and lands.

ISSUES
(1) Are Sama and Masanglay members of the Iraya-Mangyan IPs?
(2) Are the elements of the violation of P.D. 705 proven beyond reasonable doubt?

RULING
(1) YES. The Information stated that Sama and Masanglay are residents of Barangay Baras, Baco,
Oriental Mindoro. They supposedly logged a dita tree in Barangay Calangatan, San Teodoro, Oriental Mindoro.

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Notably, the municipalities of Baco and San Teodoro are areas where the Iraya-Mangyan IPs are publicly known
to inhabit. They have continuously lived there since time immemorial.

The first evidence that Sama and Masanglay are Iraya-Mangyan IPs is the testimony of Barangay
Captain Aceveda of Baras, Baco, Oriental Mindoro. He testified in clear and categorical language that Sama and
Masanglay are Mangyans and the dita tree was grown on the land occupied by the Mangyans. As barangay
captain of Barangay Baras, Baco, Oriental Mindoro where Sama and Masanglay and the Iraya-Mangyan IPs live,
Aceveda is competent to testify that Sama and Masanglay are Iraya-Mangyan IPs and the dita tree was grown
and found in the land where these IPs have inhabited since time immemorial.

The second evidence that Sama and Masanglay are indeed Iraya-Mangyan IPs is the fact that the NCIP
- Legal Affairs Office has been representing them from the initiation of this case until the present. Records
show that the NCIP- Legal Affairs Office signed the motions and pleadings filed in Sama and Masanglay'
defense before the trial court, the CA and the Supreme Court.

(2) NO. Construing the original iteration of Section 77, as then Section 68 of the original version of
PD 705, People v. CFI of Quezon (Branch VII) held that the elements of this offense are:

a. the accused cut, gathered, collected or removed timber or other forest products;
b. the timber or other forest products cut, gathered, collected or removed belongs to the
government or to any private individual; and
c. the cutting, gathering, collecting or removing was without any authority granted by the State.

In the same decision, however, the Court also ruled that ownership is not an essential element of the
offense as defined in Section 68 of P.D. No. 705. Thus, the failure of the information to allege the true owner
of the forest products is not material, it was sufficient that it alleged that the taking was without any authority
or license from the government. Hence, the Court does not consider the ownership of subject timber or other
forest products as an element of the offense under Section 68 of PD 705, now Section 77 of PD 705, as
amended.

The Court included one more element: the timber or other forest product must have been cut,
gathered, collected, or removed from any forest land, or timber, from alienable or disposable public land or
from private land. This is based on the language of the offense as defined in either Section 68 or Section 77
which expressly requires the source of the timber or other forest products to be from these types of land.

Here, the dita tree was intended for constructing a communal toilet. It therefore qualifies beyond
reasonable doubt as timber pursuant to Section 77.

The dita tree, as a specie of timber, was cut and collected beyond reasonable doubt from a private land,
as contemplated in Section 77 of PD 705, as amended, or at the very least, a forest land or an alienable or
disposable public land converted from ancestral lands, is covered, too, by PD 705, as amended. This
notwithstanding that the land is also Sama and Masanglay' ancestral domain or land which they own sui generis.

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There is, however, reasonable doubt that the dita tree was cut and collected without any authority
granted by the State.

It is a general principle in law that in malum prohibitum case, good faith or motive is not a defense because
the law punishes the prohibited act itself. The penal clause of Section 77 of PD 705, as amended punishes the
cutting, collecting, or removing of timber or other forest products only when any of these acts is done without
lawful authority from the State.

In Saguin v. People, the prohibited act of non-remittance of Pag-Ibig contributions is punishable only
when this act was done "without lawful cause" or "with fraudulent intent." According to this case law, lawful
cause may result from a confusing state of affairs engendered by new legal developments that re-ordered the
way things had been previously done. In Saguin, the cause of the confusion was the devolution of some powers
in the health sector to the local governments. The devolution was ruled as a "valid justification" constituting
the "lawful cause" for the inability of the accused to remit the Pag-Ibig contributions. The devolution gave rise
to reasonable doubt as to the existence of the offense's element of lack of lawful cause.

The general rule is that acts punished under a special law are malum prohibitum. "An act which is declared
malum prohibitum, malice or criminal intent is completely immaterial."

Here, as in Saguin, there was confusion arising from the new legal developments, particularly, the
recognition of the indigenous peoples' (IPs) human rights normative system, in our country. To paraphrase and
import the words used in Saguin, while doubtless there was voluntary and knowing act of cutting, removing,
collecting, or harvesting of timber, the Court nonetheless consider the reasonable doubt engendered by the
new normative system that the act was done without State authority, as required by Section 77 of PD 705, as
amended.

It is an admitted fact that Sama and Masanglay relied upon their elders, the non-government
organization that was helping them, and the NCIP, that they supposedly possessed the State authority to cut
and collect the dita tree as IPs for their indigenous community's communal toilet. Thus, subjectively, their intent
and volition to commit the prohibited act, that is without lawful authority, was rendered reasonably doubtful
by these pieces of evidence showing their reliance upon these separate assurances of a State authority.

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NATIONAL POWER CORPORATION (NPC) v. SPOUSES RUFO AND TOMASA LLORIN,

REPRESENTED BY THEIR ATTORNEY-IN-FACT, CORAZON CANDELARIA
G.R. No. 195217, 13 January 2021, 2ND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

It is well-settled that a case filed by a landowner for recovery of possession or ejectment against a public utility corporation,
endowed with the power of eminent domain, which has occupied the land belonging to the former in the interest of public service
without prior acquisition of title thereto by negotiated purchase or expropriation proceedings, will not prosper. Any action to compel
the public utility corporation to vacate such property is unavailing since the landowner is denied the remedies of ejectment and
injunction for reasons of public policy and public necessity as well as equitable estoppel.

Here, the MTCC therefore should have dismissed the case without prejudice to the landowner's filing of the proper action
for just compensation and consequential damages; or directed the NPC (TRANSCO) to initiate the proper expropriation
proceedings and to pay just compensation and consequential damages. Notably, the considerable length of time that elapsed before
Spouses Llorin or their predecessors-in-interest questioned the government's so called unconsented entry into the property and
installation of the 69 kV Naga-Tinambac power transmission lines, sans expropriation proceedings, constitutes a waiver of their
right to gain back its possession.

FACTS
Spouses Rufo and Tomasa Llorin (Spouses Llorin) claimed to be the registered owners of a parcel of
land in Naga City, which National Power Corporation (NPC) occupied without their consent in 1978 to
construct power transmission lines.

The Spouses Llorin and their predecessors-in-interest allowed NPC's occupation on the condition that
it would be temporary and that monthly rentals would be paid. When the Spouses Llorin demanded the return
of the property and payment of rentals, NPC refused to comply. Consequently, the Spouses Llorin filed a
complaint for unlawful detainer before the Municipal Trial Court in Cities (MTCC) in Naga City.

The MTCC ruled in favor of Spouses Llorin and ordered NPC to vacate the premises and pay the
monthly rentals from the use of land until it is vacated. This was affirmed by the Regional Trial Court (RTC)
and the Court of Appeals (CA).

ISSUE
Does an action for unlawful detainer lie to oust the NPC (TRANSCO) from the property which holds
its 69 kV Naga-Tinambac power transmission lines since 1978?

RULING
NO. It is well-settled that a case filed by a landowner for recovery of possession or ejectment against
a public utility corporation, endowed with the power of eminent domain, which has occupied the land belonging
to the former in the interest of public service without prior acquisition of title thereto by negotiated purchase
or expropriation proceedings, will not prosper. Any action to compel the public utility corporation to vacate
such property is unavailing since the landowner is denied the remedies of ejectment and injunction for reasons
of public policy and public necessity as well as equitable estoppel.

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The proper recourse is for the ejectment court: (1) to dismiss the case without prejudice to the
landowner filing the proper action for recovery of just compensation and consequential damages; or (2) to
dismiss the case and direct the public utility corporation to institute the proper expropriation or condemnation
proceedings and to pay the just compensation and consequential damages assessed therein; or (3) to continue
with the case as if it were an expropriation case and determine the just compensation and consequential damages
pursuant to Rule 67 (Expropriation) of the Rules of Court, if the ejectment court has jurisdiction over the value
of the subject land. (Emphasis supplied)

Here, the MTCC therefore should have dismissed the case without prejudice to the landowner's filing
of the proper action for just compensation and consequential damages; or directed the NPC (TRANSCO) to
initiate the proper expropriation proceedings and to pay just compensation and consequential damages.
Notably, the considerable length of time that elapsed before Spouses Llorin or their predecessors-in-interest
questioned the government's so called unconsented entry into the property and installation of the 69 kV Naga-
Tinambac power transmission lines, sans expropriation proceedings, constitutes a waiver of their right to gain
back its possession.

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PEOPLE OF THE PHILIPPINES v. EDGAR MAJINGCAR YABUT and CHRISTOPHER RYAN

LLAGUNO y MATOS
G.R. No. 249629, 15 March 2021, SECOND DIVISION (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 2, Rule 116 of the Rules of Court states:

Section 2. Plea of guilty to a lesser offense. - At arraignment, the accused, with the consent of the offended party and the
prosecutor, may be allowed by the trial court to plead guilty to a lesser offense which is necessarily included in the offense
charged. After arraignment but before trial, the accused may still be allowed to plead guilty to said lesser offense after
withdrawing his plea of not guilty. No amendment of the complaint or information is necessary.

Hence, in drug cases where there is no private offended party, the consent of the prosecutor is the operative act which vests
discretion upon the court to allow or reject the accused's proposal to plead guilty to a lesser offense. Thus, where this consent is
withheld, no such discretion gets vested in the court.

CA erred when it affirmed the unconstitutionality of DOJ Circular Nos. 027 and 061 and RPO Order No. 027-E-
18, as decreed by the trial court

FACTS

Respondents Edgar Majingcar y Yabut (Majingcar) and Christopher Ryan Llaguno y Matos (Llaguno)
were charged with violations of Sections 5 and 11, Article II of Republic Act No. 9165 (RA 9165).

On arraignment, respondents Majingcar and Llaguno pleaded not guilty to both charges. Thereafter,
trial ensured.

On separate occasions, respondents submitted their proposals to plead guilty to a lesser offense,
specifically to violation of Section 12, Article II of RA 9165 pursuant to A.M. No. 18-03-16-SC entitled
Adoption of the Plea Bargaining Framework in Drugs Cases.

The prosecution, citing Department of Justice (DOJ) Circular No. 027, counter proposed that
respondents plead guilty to violation of Section 5, albeit the penalty would be that as provided under paragraph
3, Section 11 of RA 9165 for Criminal Case No. 2016-0774. As for respondents' proposal to plead guilty in
Criminal Case No. 2016-0775 on violation of Section 12 of RA 9165, in lieu of Section 11, the prosecution
interposed no objection.

The trial court allowed both respondents to plead to a lesser offense, as proposed. It further declared
DOJ Circular Nos. 061 and 027 and Regional Prosecution Office (RPO) Order No. 027-E-18 unconstitutional
for allegedly infringing the rule-making power of the Supreme Court.

The prosecution’s motion for reconsideration was denied. Consequently, respondents were re-
arraigned. Pursuant to their respective plea bargaining proposals, as approved by the court, they changed their
individual pleas of "not guilty" to "guilty" to the lesser offense of violation of Section 12, Article II of RA 9165
in both Criminal Case Nos. 2016-0774 and 2016-0775.

The trial court issued the assailed Judgment.

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On a petition for certiorari initiated by the People, the Court of Appeals (CA) dismissed the petition on
two (2) grounds: late filing and lack of merit. The CA stated that the petition should be dismissed as it was filed
beyond the sixty (60) day period. On the merits, the CA pronounced that the petition should still fail for failure
to show that the trial court gravely abused its discretion when it allowed respondents to plead to a lesser offense
in both cases, following A.M. No. 18-03-16-SC. On this score, the CA cited Estipona v. Hon. Lobrigo which
struck down as unconstitutional the prohibition against plea bargaining in drugs cases. It further upheld the
trial court's declaration that DOJ Circular Nos. 027 and 061 and RPO Order No. 027-E-18 are unconstitutional
for being contrary to the intent of Estipona and A.M. No. 18-03-16-SC.

Hence, this petition.

ISSUES
(1) Did the Court of Appeals commit reversible error when it declared that the People initiated the
petition for certiorari out of time?
(2) Did the Court of Appeals commit reversible error when it affirmed the grant of respondents'
proposal to plead guilty to the lesser offense of violation of Section 12, Article II of RA 9165 in
Criminal Case Nos. 2016-0774 and 2016-0775?
(3) Did the Court of Appeals commit reversible error when it affirmed the unconstitutionality of DOJ
Circular Nos. 027 and 061 and RPO Order No. 027-E-18, as decreed by the trial court?
(4) Does the People's challenge against the verdict of conviction violate respondents' right against
double jeopardy?

RULING
(1) YES. CA erred when it declared that the People initiated the petition for certiorari out of time.

Under Rule 65 of the Rules of Court, a petition for certiorari must be filed within sixty (60) days from
notice of the judgment, order, or resolution sought to be assailed.

Here, the People claims that it reckoned the sixty (60) day period from September 18, 2018 when the
prosecutor received a copy of the trial court's judgment of conviction that was rendered on the same day.
Remarkably, neither respondents nor the CA disagrees that indeed, on September 18, 2018, the trial rendered
the assailed judgment and it was on the same day, too, when the prosecutor had notice thereof. It follows,
therefore, that starting from September 18, 2018, the sixty-day period expired on November 17, 2018. So when
the People filed its petition for certiorari on November 16, 2018, it did so still well within the reglementary
period.

As for the alleged failure of the People to seek a reconsideration of the judgment of conviction as
condition precedent to the filing of its petition for certiorari, records show that in fact, the People had initially
filed a motion for reconsideration of the grant of respondents' proposed plea bargaining in Criminal Case Nos.
2016-0774 and 2016-0775, albeit it was denied. In any case, the filing of a motion for reconsideration as
condition sine qua non to initiating a petition for certiorari is not an ironclad rule as it admits of well-defined
exceptions, among them, where the questions raised in the certiorari proceedings have been duly raised and
passed upon by the lower court, or are the same as those raised and passed upon in the lower court; and where
the issue raised is one purely of law or where public interest is involved. These exceptions are both present
here, thus dispensing with the prior filing of a motion for reconsideration is in order.

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(2) NO. The CA did not err when it affirmed the grant of respondents' proposal to plead guilty to the
lesser offense of violation of Section 12, Article II of RA 9165 in Criminal Case Nos. 2016-0774 and 2016-
0775.

In Criminal Case No. 2016-077, for illegal possession of drugs, the prosecution interposed no objection
to respondents' proposal to plead to the lesser offense of violation of Section 12, Article II of RA 9165. Whether
to grant this proposal already rested upon the sound discretion of the court. Thus, the trial court cannot be
faulted with grave abuse of discretion, amounting to excess or lack of jurisdiction when first, it approved
respondents' aforesaid proposal, then set their re-arraignment and accepted their pleas of guilty to the lesser
offense proposed, and finally rendered a judgment of conviction against them.

(3) YES. CA erred when it affirmed the unconstitutionality of DOJ Circular Nos. 027 and 061 and
RPO Order No. 027-E-18, as decreed by the trial court

Section 2, Rule 116 of the Rules of Court states:

Section 2. Plea of guilty to a lesser offense. - At arraignment, the accused, with the consent of the
offended party and the prosecutor, may be allowed by the trial court to plead guilty to a lesser offense
which is necessarily included in the offense charged. After arraignment but before trial, the accused
may still be allowed to plead guilty to said lesser offense after withdrawing his plea of not guilty. No
amendment of the complaint or information is necessary.

Hence, in drug cases where there is no private offended party, the consent of the prosecutor is the
operative act which vests discretion upon the court to allow or reject the accused's proposal to plead guilty to
a lesser offense. Thus, where this consent is withheld, no such discretion gets vested in the court.

In his Separate Concurring Opinion in Sayre v. Xenos, citing People v. Villarama, Associate Justice
Radii V. Zalameda explained the importance of the prosecutor's prior consent to a proposed plea of guilty to a
lesser offense by the accused. He further clarified that when the accused refuses to enter a plea to the offense
charged or when the prosecutor objects to a proposed plea of guilty to a lesser offense, the trial court cannot
proceed to approve a plea bargain based on the Plea Bargaining Framework. If it does, the trial court commits
grave abuse of discretion.

There is grave abuse of discretion when the disputed act of the lower court goes beyond the limits of
discretion, thus, committing a miscarriage of justice. Here, the trial court acted with grave abuse of discretion
or without jurisdiction when despite the vehement objection of the prosecution, it peremptorily, in clear
violation of Section 2, Rule 116 of the Rules of Court, approved respondents' proposed plea bargaining in
Criminal Case No. 2016-0774, specifically, to enter a plea of guilty to the lesser offense of violation of Section
12, Article II of RA 9165, in lieu of the original charge of violation of Section 5, Article II of RA 9165.

(4) NO. The People's challenge against the verdict of conviction did not violate respondents' right
against double jeopardy.

Section 7(c) Rule 117 is self-explanatory. Based thereon, there is no bar to another prosecution against
respondents for violation of Section 5, Article II of RA 9165 in Criminal Case No. 2016-0774.

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SECURITIES AND EXCHANGE COMMISSION v. COMMISSION ON AUDIT

G.R. No. 252198, 27 April 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The plain meaning rule of statutory construction, or verba legis, requires that laws be interpreted according to their explicit
language. In the case of Section 75 of the SRC, which permits the SEC to retain and use P100,000,000 from its income, the
Court found that this amount must be used strictly according to auditing requirements and existing laws. The SEC's misuse of
these funds for contributions to a provident fund was deemed a violation by the COA, as it did not adhere to the legal requirements
for the allocation of retained income.

Moreover, the validity of a Notice of Disallowance does not automatically make approving, certifying, and authorizing
officers liable for returning the disallowed amount. According to the Rules on Return, liability depends on specific conditions: if a
Notice is overturned, no return is required, but if upheld, officers who acted in good faith and with due diligence are not civilly liable,
while those who acted with malice, bad faith, or gross negligence are liable for the net disallowed amount. In this case, there was no
evidence of malice or gross negligence by the officers, and their reliance on valid legal opinions and assurances from the DBM indicates
good faith. While payee-recipients are generally liable under the principle of solutio indebiti, exceptions apply when returning the
amounts would cause undue prejudice, as seen in the SEC case where imposing different liabilities on the officers compared to other
payees would be unjust.

FACTS
By Resolution No. 31, Series of 2002, the Securities and Exchange Commission (SEC) established a
provident fund for its officials and employees pursuant to Section 7 of the Securities Regulation Code (SRC).
Thereafter, SEC En Banc, in its Resolution No. 144 Series of 2003, approved an across-the-board 15% increase
of its counterpart contribution to the provident fund. The 15% shall be taken from the SEC’s retained income
under Section 75 of the SRC.

In August 2004, the SEC received a letter from the Department of Budget and Management (DBM)
informing the SEC that the utilization of retained income is left to the discretion of the Commission, subject
to the usual accounting rules and regulations. Pursuant to Section 93 of the General Appropriations Act for FY
2010 (GAA 2010), the SEC submitted auditing requirements to the Commission on Audit (COA) and declared
that around Php 19,000,000.00 was disbursed as a counterpart contribution to the provident fund.

The COA-SEC Audit Team Leader Milagros Torres-Songsong and Supervising Auditor Manuel Saes
disallowed the disbursement made under a Notice of Disallowance. According to them, the disbursement from
the retained income is not in accord with Section 1 of the Special Provisions for the SEC– GAA for Fiscal Year
2010. This prompted the SEC to appeal before the COA-National Government Sector (COA-NGS), which
was affirmed and further affirmed by COA En Banc.

The SEC argues that COA overlooked the fact that the disbursement was part of its retained income
under Section 75 of the SRC. As such, it was an off-budget fund, it did not need appropriation, and was not
included in the coverage of GAA 2010. Further, Section 75 of the SRC grants the SEC exclusive discretion on
how it should be used. On the other hand, the Office of the Solicitor General (OSG) contends that the authority
of the SEC is still subject to auditing requirements, standards, and procedures, and it violated Special Provision
No. 1 for SEC in GAA 2010, Section 37 of PD 1177 and Sections 34 and 25 of the Administrative Code.

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ISSUES
(1) Did COA validly disallow the allocation and payment of Php 19,723,444.66 to the provident fund?
(2) Are the approving, certifying, and authorizing officials of the SEC liable to refund the disallowed
amount?

RULING
(1) YES. The plain meaning rule of statutory construction mandates that laws should be
interpreted based on their explicit language without extending or altering their meaning beyond what
is plainly stated. This principle is known as verba legis.

Applying this rule to Section 75 of the SRC, which authorizes the SEC to retain and utilize funds from
its income in addition to its annual budget, the Court found that the provision is accompanied by a restriction:
the additional amount must be used in accordance with auditing requirements and existing laws. Special
Provision No. 1 of the GAA 2010 further specifies that this retained income is meant exclusively to augment
the SEC's Maintenance and Other Operating Expenses (MOOE) and Capital Outlay (CO) allocations. This
provision does not repeal Section 75 but imposes a limitation on how the retained funds can be utilized, making
the two provisions supplementary rather than contradictory.

Despite these clear stipulations, the SEC misapplied the retained income by using it for contributions
to the provident fund, which does not fall under MOOE or CO. According to the Chart of Accounts and the
GAA 2010, MOOE includes expenses necessary for the agency's regular operations, such as travel, training,
utilities, and maintenance, while CO pertains to expenditures that extend beyond the fiscal year and enhance
government assets. The provident fund, being a retirement plan, does not align with either category but rather
fits within "personal services," a classification for salaries and related compensation.

The COA correctly disallowed the SEC's use of the retained income for the provident fund because it
did not adhere to the intended use of augmenting MOOE and CO as specified by law. This misapplication was
deemed a violation of both the specific legal provisions and the broader requirements governing the use of
retained income. The COA's decision to disallow the expenditure is consistent with legal principles and the
correct interpretation of the statutory provisions governing the SEC's budget and expenditure authority.

(2) NO. The validity of a Notice of Disallowance (Notice) does not automatically render
approving, certifying, and authorizing officers liable for returning the disallowed amount. The Rules
on Return, as derived from the Madera case, establish that the liability of these officers depends on
specific conditions. If the Court overturns a Notice, no return is required from the liable parties.
However, if the Notice is upheld, the rules stipulate that approving and certifying officers who acted
in good faith and exercised due diligence are not civilly liable. Conversely, officers who acted with
malice, bad faith, or gross negligence are solidarily liable to return only the net disallowed amount.

Recipients of disallowed funds must return the amounts they received unless they can prove that the
amounts were genuinely for services rendered. The Court may excuse the return in cases where it would result
in undue prejudice, violate principles of social justice, or for other bona fide reasons. In the Madera case, it was
underscored that civil liability requires clear evidence of bad faith, malice, or gross negligence. Malice and bad
faith involve deliberate wrongful acts or dishonest purposes, while gross negligence signifies a blatant disregard

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for duty. In the current case, there was no evidence to suggest that SEC officers acted with malice or gross
negligence; their actions appeared to reflect good faith.

The Madera case adopted Justice Leonen’s criteria for assessing good faith, which includes reliance on
valid legal opinions and the absence of prior disallowances. Here, similar considerations apply. The SEC had
been making similar payments without prior disallowance and had received assurances from the DBM regarding
the use of retained earnings. The officers’ belief that their actions were compliant with the SRC’s compensation
plan further indicates their good faith.

Regarding civil liability for recipients, the Abellanosa case clarified that payee-recipients are generally
liable under the principle of solutio indebiti, regardless of their good faith. Exceptions to this rule exist, such as
when the amounts were genuinely given for services rendered or if returning the amounts would cause undue
prejudice or injustice. The prior absolution of other SEC payees and the fact that SEC officers also received
the disallowed amounts suggest that it would be unjust to impose different liabilities on them. The equal
protection clause supports this, ensuring that no undue prejudice is inflicted on the SEC officers compared to
other payees.

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VICTOR M. BARROSO v. COMMISSION ON AUDIT

G.R. No. 253253, 27 April 2021, EN BANC (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The Court now clarifies this ruling, stating that filing for a motion for reconsideration does not cure due process defects,
especially if the said motion was filed precisely to raise the issue of violation of the right to due process and the lack of opportunity
to be heard on the merits. In other words, if a person has not been given the opportunity to squarely and intelligently answer the
accusations or rebut the evidence presented against him, or raise substantive defenses through the proper pleadings before a quasi-
judicial body (like the COA) where he or she stands charged, then a due process problem exists.

Due to this, the Barroso never had the opportunity to thoroughly argue the merits of his case precisely because he was not
properly informed of what he was supposed to argue against. Thus, he was constrained to limit the discussion in his motion for
reconsideration to the issue of due process. This cannot be considered as an opportunity to be heard within the concept of
administrative due process.

FACTS
In 2005, Administrative Officer II Evelyn S. Mag-abo (Mag-abo) was granted a cash advance of
P574,215.27 for the payment of salaries of the Bukidnon State University (BSU) employees. After Mag-abo
encashed the payroll with Landbank, she, together with other BSU employees walked back to BSU. However,
upon leaving the bank, an unidentified man grabbed Mag-abo’s bag containing the payroll money.

By Audit Observation Memorandum, the Commission On Audit (COA) Audit Team Leader Teresita
Quijada informed the Victor Barroso (Barroso). She issued a demand letter to the latter, directing her to produce
the unliquidated amount and explain within 72 hours why the case shortage occurred.

Mag-abo then explained the incident to the petitioner and requested relief for her cash accountability
with the COA Legal Adjudication Office. However, this request was denied. Mag-abo then elevated her cause
to the COA Commission Property (COA Proper) but this was denied again. She then moved for
reconsideration, stating that she requested for a security escort and vehicle from her supervisor, but none was
provided.

In its decision, the COA Proper held Mag-abo, Barroso (as the president of BSU), and Wilma Gregory
(as supervisor of the Cashiering Department), to be solidarily liable for the loss. As for Barroso, the COA
Proper found that he had failed to exercise the diligence expected of a good father since he did not adopt
precautionary measures to safeguard the funds of BSU. Barroso moved for reconsideration but was denied.

Barroso then appealed to the Supreme Court, he argues that the COA Proper acted with grave abuse
of discretion when it found him solidarity liable to return the stolen amount without observing his right to due
process of law, and despite the insufficiency of evidence to establish negligence on his part. First, in the
proceedings against Mag-abo, the Barroso was never made a party thereto until the case reached the COA and
he was never asked to participate in the proceedings nor appear in the case. And second, the finding of
negligence against him had no factual basis.

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In its comment, the Office of the Solicitor General (OSG) sided with the COA Property, stating that
Barroso was not denied due process because he was afforded an opportunity to seek reconsideration of the
ruling.

ISSUES
Did COA violate Barroso’s right to due process?

RULING
YES. In the case of Ang Tibay v. Court of Industrial Relations, the Court ruled that following are the
requisites of due process in administrative proceedings:

1. The right to a hearing, which includes the right to present one’s case and submit evidence in
support thereof
xxx
5. The decision must be rendered on the evidence presented at the hearing, or at least contained
in the record and disclosed to the parties
Xxx

In this case, the OSG cited the case of Ledesma v. CA, where the Court held that the essence of due
process is simply to be heard or an opportunity to explain one’s side, including the opportunity to seek a
reconsideration of an action or ruling.

The Court clarifies this ruling, stating that filing for a motion for reconsideration does not cure due
process defects, especially if the said motion was filed precisely to raise the issue of violation of the right to due
process and the lack of opportunity to be heard on the merits. In other words, if a person has not been given
the opportunity to squarely and intelligently answer the accusations or rebut the evidence presented against
him, or raise substantive defenses through the proper pleadings before a quasi-judicial body (like the COA)
where he or she stands charged, then a due process problem exists.

In the case at bar, Barroso was found liable though he was never charged. The proceedings prior to
the COA proper’s reconsideration all pointed to Mag-abo as the sole negligent party for the loss. The Barroso
only got involved in the proceedings when the COA Proper denied Mag-abo’s motion for reconsideration and
ordered him to pay the unliquidated amount.

Due to this, the Barroso never had the opportunity to thoroughly argue the merits of his case precisely
because he was not properly informed of what he was supposed to argue against. Thus, he was constrained to
limit the discussion in his motion for reconsideration to the issue of due process. This cannot be considered as
an opportunity to be heard within the concept of administrative due process.

Where the denial of the fundamental right of due process is apparent, a decision rendered is disregard
of such right is void for lack of jurisdiction. Any judgment or decision rendered notwithstanding such violation
may be regarded as a lawless thing.

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CATHAY PACIFIC STEEL CORPORATION v. COMMISSION ON AUDIT, NATIONAL

POWER CORPORATION AND POWER SECTOR ASSETS AND LIABILITIES
MANAGEMENT CORPORATION
G.R. No. 252035, 04 May 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Under the doctrine of finality of judgment, a decision that has acquired finality becomes immutable and unalterable, and
may no longer be modified in any respect, even if the modification is meant to correct erroneous conclusions of fact and law, and
whether it be made by the court that rendered it or by the Highest Court of the land. Any act which violates this principle must
immediately be struck down.

Here, COA committed grave abuse of discretion amounting to excess or lack of jurisdiction when it dismissed outright
the money claim of CAPASCO in the amount of P24,637,094.65 despite the final and executory Decision dated May 27, 2010
of the Court of Appeals granting the same.

FACTS
Then President Gloria Macapagal-Arroyo gave a directive for electric power producers and distributors
to give price incentives to large electricity users.

The Energy Regulatory Commission (ERC) adopted the Special Program to Enhance Electricity
Demand (SPEED), which offered discounts to qualified industrial customers on their incremental consumption
of power. ERC tasked the National Power Corporation (NPC) to further implement the program.

NPC deviated from the SPEED guidelines and belatedly implemented the discounts. ERC
reprimanded NPC and directed it to grant the correct discounts to qualified customers.

Meantime, Cathay Pacific Steel Corporation (CAPASCO) asked ERC to order NPC to implement its
entitlement to SPEED discount; which was granted by ERC and affirmed by the Court of Appeals (CA).
However, this was still not heeded by NPC.

Nevertheless, CAPASCO was still compelled to pay as there was still no discount reflected on its
outstanding balance. With this, CAPASCO filed for money claim before the Commission on Audit (COA)
arguing that the NPC failed to comply with the final and executory decision of the CA.

The COA eventually denied the money claim.

ISSUE
Did the COA commit grave abuse of discretion when it denied CAPASCO's money claim despite the
final and executory rulings of the Court of Appeals and the ERC?

RULING
YES. Under the doctrine of finality of judgment, a decision that has acquired finality becomes
immutable and unalterable, and may no longer be modified in any respect, even if the modification is meant to
correct erroneous conclusions of fact and law, and whether it be made by the court that rendered it or by the
Highest Court of the land. Any act which violates this principle must immediately be struck down.

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Here, COA committed grave abuse of discretion amounting to excess or lack of jurisdiction when it
dismissed outright the money claim of CAPASCO in the amount of P24,637,094.65 despite the final and
executory Decision dated May 27, 2010 of the Court of Appeals granting the same.

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PEOPLE OF THE PHILIPPINES v. SPO1 ALEXANDER ESTABILLO Y PALARA

G.R. No. 252902, 16 June 2021, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Objections against the lawfulness of an arrest which are not raised through a motion to quash before the accused enters
his or her plea are deemed waived, for the voluntary submission of an accused to the jurisdiction of the court and his or her active
participation during the trial cures any defect or irregularity that may have attended an arrest.

Here, Estabillo questioned the validity of his arrest only on appeal before the Court of Appeals. By that time, Estabillo
was already estopped from raising any objection against the legality of his warrantless arrest. To be sure, Estabillo willingly stipulated
during the pre-trial that the trial court had jurisdiction over his person. Estabillo is therefore barred from claiming otherwise.

FACTS
Acting on the report by a confidential informant, the police authority conducted a buy-bust operation
against a certain Alex, a member of the Philippine National Police (PNP) assigned at the Ninoy Aquino
International Airport. SPO2 Leonardo Taldo (SPO2 Taldo) was assigned as the poseur buyer, PO3 Lawrence
Perida (PO3 Perida), and SPO3 Miguel Ngo (SPO3 Ngo) as the arresting officers.

Alex was allegedly selling cocaine. At around 8:20 in the evening, the confidential informant introduced
SPO2 Taldo to Alex, later identified as Alexander Estabillo (Estabillo). SPO2 Taldo ordered four (4) kilos of
cocaine and asked for a sample. Before they separated, they agreed that Estabillo would contact the confidential
informant once the four (4) kilos of cocaine became available. The sample was brought to the PNP Crime
Laboratory for examination which yielded positive for cocaine.

The buy-bust team prepared for the operation upon notice that the four (4) kilos of cocaine became
available. At the area of the operation, Estabillo arrived on board a car where he invited SPO2 Taldo to board
the front passenger seat. After the transaction, SPO2 Taldo signaled the rest of the team leading to the arrest
of Estabillo. The officers retrieved four (4) bricks of suspected cocaine which were immediately marked.

The marking was done in the presence of Barangay Kagawad Felix Santos (Kagawad Santos) and two
(2) representatives from the media, Erika Tapalla (Tapalla) from ABC 5 and Perillo from GMA 7. An inventory
of the seized items was then prepared in the presence of Estabillo and the witnesses. Photographs were taken
during the marking and inventory. No prosecutor from the Department of Justice (DOJ) was available to
witness the inventory that night.

After the marking and inventory, SPO2 Taldo and PO3 Perida turned over the seized items to the
investigator. Upon concluding the investigation, the two (2) boxes containing two (2) bricks each of suspected
cocaine were turned over to the PNP Crime Laboratory. All these happened at the place of arrest. Subsequently,
the suspected 4 bricks of cocaine were examined, and all tested positive for cocaine.

Estabillo was charged with violation of Sections 5 and 11 of Comprehensive Dangerous Drug Act of
2022 (R.A. No. 9165) under two separate informations. The Regional Trial Court (RTC) found Estabillo guilty
as charged. On appeal, Estabillo argued, among others, that he was illegally arrested. The Court of Appeals
(CA), however, affirmed Estabillo’s conviction. Thus, the present case.

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ISSUE
Was Estabillo’s warrantless arrest valid?

RULING
YES. Section 5, Rule 113 of the Rules of Criminal Procedure enumerates the instances when a
warrantless arrest is lawful.

Here, Estabillo was arrested in flagrante delicto following a buy-bust operation. As borne in the records,
poseur-buyer SPO2 Taldo paid Estabillo six (6) P500.00 bills placed inside a bag of boodle money, all dusted
with ultraviolet powder, in exchange for two (2) bricks of suspected cocaine placed inside a maroon-brown
Otto shoebox. Once the transaction got consummated, SPO2 Taldo performed the buy-bust team’s pre-
arranged signal by calling the phone of SPO3 Ngo. Subsequently, the rest of the buy-bust team rushed to arrest
Estabillo and performed a search on his vehicle, resulting in the seizure of yet another shoebox containing two
(2) more bricks of suspected cocaine

Estabillo nevertheless assails the validity of his warrantless arrest, arguing on appeal that he could not
have been caught in flagrante delicto selling dangerous drugs since the arresting officers had no personal
knowledge on whether the four (4) bricks allegedly seized from him were actually cocaine. Too, SPO2 Taldo’s
call to SPO3 Ngo was not sufficient basis for probable cause that he had just committed a crime.

Objections against the lawfulness of an arrest which are not raised through a motion to quash before
the accused enters his or her plea are deemed waived, for the voluntary submission of an accused to the
jurisdiction of the court and his or her active participation during the trial cures any defect or irregularity that
may have attended an arrest.

Here, Estabillo questioned the validity of his arrest only on appeal before the Court of Appeals. By
that time, he was already estopped from raising any objection against the legality of his warrantless arrest. To
be sure, Estabillo willingly stipulated during the pre-trial that the trial court had jurisdiction over his person.
Estabillo is therefore barred from claiming otherwise.

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PHILIPPINE NATIONAL CONSTRUCTION CORPORATION v. NATIONAL LABOR

RELATIONS COMMISSION
G.R. No. 248401, 23 June 2021, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The PNCC is not 'just like any other private corporation precisely because it is not a private corporation' but indisputably
a government owned corporation. Neither is PNCC "an autonomous entity" considering that PNCC is under the Department of
Trade and Industry, over which the President exercises control. To claim that PNCC is an "autonomous entity" is to say that it
is a lost command in the Executive branch, a concept that violates the President's constitutional power or control over the entire
Executive branch of government.

Further, Section 6 of PD 1597 ordains that GOCCs are subject to such guidelines and policies as may be issued by the
President governing position classifications, salary rates, levels of allowances, project and other honoraria, overtime rates, and other
forms of compensation and fringe benefits. GOCCs organized under the Corporation Code like PNCC are not excluded from the
coverage of PD 1597.

FACTS
Philippine National Construction Corporation (PNCC) was founded in 1966 under the name
Construction Development Corporation of the Philippines (CDCP), in accordance with the Corporation Code
of the Philippines (CDCP).

CDCP got loans from several Government Financing Institutions (GFIs) over the course of its
activities. President Ferdinand E. Marcos issued Letter of Instruction (LOI) No. 1295, instructing the GFIs to
convert all CDCP’s unpaid debts to them into stock shares. As a result of the LOI’s execution, the GFIs became
the main investors of PNCC. CDCP’s Articles of Incorporation and By-Laws were later changed to reflect the
scope of the Government’s ownership interest in the firm as a result of the debt-to-equity conversion of CDCP
loans.

Then, President Gloria Macapagal-Arroyo signed Executive Order No. 331, which transferred PNCC
to the Department of Trade and Industry (DTI). PNCC began providing mid-year incentives to its employees
as part of a Collective Bargaining Agreement (CBA) with its then-employee union. However, even after the
CBA ended, the staff continued to receive mid-year bonuses until 2012.

Meanwhile, on April 30, 2013, Atty. Luis F. Sison (Atty. Sison), then-PNCC President and Chief
Executive Officer, requested the advice of PNCC’s statutory counsel, the Office of the Government Corporate
Counsel (OGCC), on the disbursement of the mid-year bonus for 2013 pursuant to Presidential Decree (PD)
No. 1597.

The OGCC urged PNCC to get clearance from the Governance Commission for Government Owned
or Controlled Corporations (GCG). As a result, PNCC requested GCG’s approval for the payment of a mid-
year bonus to its staff. The GCG informed them that it would not transmit the request for approval to then-
President Benigno Aquino III since the grant was legally infirm and abrogation would not violate the non-
diminution rule.

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In accordance with that, Atty. Sison sent a note to all PNCC workers notifying them that the 2013
Mid-Year Bonus will not be paid. In response, PNCC employees filed a complaint with the National Labor
Relations Commission (NLRC) Arbitration Branch for non-payment of a mid-year bonus as well as salary and
benefit reductions.

The Labor Arbitrator (LA) determined that the practice of awarding mid-year bonuses to PNCC
employees since 1992 had matured into a benefit or supplement that could not be reduced, diminished,
discontinued, or eliminated in compliance with Labor Code Article 100 on non-diminution of benefits. The
NLRC upheld the labor arbitrator’s ruling. It ruled that PNCC is not a GOCC because it was established under
the Philippine Corporation Code. PNCC, too, is a private firm despite the fact that the government owns the
majority of its shares.

When appealed to the Court of Appeals (CA), the CA rejected the petition because PNCC neglected
to file a motion for reconsideration of the NLRC judgment at issue. It confirmed PNCC’s status as a private
business. It further said that, even though PNCC is a GOCC, PD 1597 and Republic Act No..10149 (R.A. No.
10149) are inapplicable to GOCCs with no original charter, such as PNCC.

The CA determined that PNCC is an acquired asset corporation rather than a GOCC, citing PNCC v.
Pabion and Cuenca v. Hon. Altas. Despite the fact that the government has a majority stake in PNCC, the latter
is a private business subject to the Labor Code rather than the Civil Service Law.

ISSUE
Is PNCC a private corporation?

RULING
NO. PNCC is a non-chartered government owned and controlled corporation. In Strategic Alliance v.
Radstock Securities, the Court pronounced with finality that PNCC is a GOCC, viz:

The PNCC is not 'just like any other private corporation precisely because it is not a private
corporation' but indisputably a government owned corporation. Neither is PNCC "an
autonomous entity" considering that PNCC is under the Department of Trade and Industry,
over which the President exercises control. To claim that PNCC is an "autonomous entity" is
to say that it is a lost command in the Executive branch, a concept that violates the President's
constitutional power or control over the entire Executive branch of government.

The Court emphasized that PNCC is 90.3% owned by the government and may not be considered an
autonomous entity just because it got incorporated under the Corporation Code. Additionally, Executive Order
No. 331, series of 2004 has placed the PNCC under the Department of Trade and Industry (DTI), thus,
confirming its character as a GOCC.

Further, Section 6 of PD 1597 ordains that GOCCs are subject to such guidelines and policies as may
be issued by the President governing position classifications, salary rates, levels of allowances, project and other
honoraria, overtime rates, and other forms of compensation and fringe benefits. GOCCs organized under the
Corporation Code like PNCC are not excluded from the coverage of PD 1597. Verily, therefore, the status of
PNCC as a GOCC should now be put to rest.

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UNIVERSITY OF SANTO TOMAS | POLITICAL LAW

IRENE S. ROSARIO v. COMMISSION ON AUDIT

G.R. No. 253686, 29 June 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Prevailing jurisprudence on the right to speedy disposition of cases is sourced from the landmark ruling of the United
States Supreme Court in Barker v. Wingo wherein a delicate balancing test was crafted to determine whether said right had been
violated. The balancing test has four (4) factors:
(1) length of delay,
(2) the reason for the delay,
(3) the defendant's assertion of his right, and
(4) prejudice to the defendant.

In the present case, here all factors are evident. Firstly, as to the length of delay, it is undisputed that it took more than
seven years from the time AOM No. Dep Ed RO13-2009-003 was issued on February 17, 2009, until the COA promulgated
its November 9, 2016 Decision against Rosario. Particularly, it took more than five years from the time the case was elevated to
the COA for automatic review before a decision was rendered on November 9, 2016. Secondly, The case was not inexplicably
complex as the appeal contained the same arguments earlier raised and exhaustively discussed in LAO-Corporate Decision No.
2008-046. There was therefore no reason for the COA Proper to have taken six (6) years to resolve the same. Thirdly, Rosario's
actions, or inaction, did not amount to acquiescence. For during the six (6) years of inaction on her part, she never knew that the
case was ongoing as she had already resigned. The COA also failed to notify her of the developments of the case much less seek her
response thereto. Thus, Rosario did not have any legitimate avenue to assert her fundamental right to speedy disposition of cases
during the six (6) year period. Lastly, COA's inexplicable delay of eleven (11) long years brought Rosario to a "roller coaster
ride" of emotions. The initial shock and dismay of finding out that she was liable after having been exonerated after such a long
time did not wear down and subjected her to constant distress and worry.

FACTS
The Employee's Compensation Commission (ECC) undertook to renovate its antiquated building and
procured modular workstations. The ECC conducted a public bidding through the recommendation of the
Bids and Awards Committee (BAC) but ultimately decided to resort to direct contracting due to the specific
technical specifications required. The workstations were supplied and installed by Accent Systems, Inc.

In 2006, the Commission on Audit (COA) issued a Notice of Disallowance, citing several deficiencies
in the procurement process and holding the certifying officers of ECC and members of the BAC including
Irene Rosario (Rosario) liable. However, in 2008, the COA's Legal and Adjudication Office-Corporate (LAO-
Corporate) issued a decision exonerating Rosario and other members of the BAC from liability.

Satisfied with the decision, Rosario no longer filed an appeal. Subsequently, due to the untimely death
of her husband, Rosario resigned from her post in the ECC and returned to her province to care for her
children.

In 2014, the COA Proper reversed the LAO-Corporate decision and reinstated the liability of Rosario
and the other BAC members. Rosario filed a motion for reconsideration, which was denied in 2020.

Rosario argued that the COA Proper violated her right to a speedy disposition of her case and
disregarded the doctrine of finality of judgments. She also asserted that the BAC's role was limited to

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recommending an alternative mode of procurement and that she acted in good faith in the performance of her
duties.

ISSUE
Did the COA Proper violate Rosario's right to speedy disposition of her case?

RULING
YES. Article III, Section 16 of the 1987 Constitution guarantees the right to speedy disposition of
cases, viz.:

Section 16. All persons shall have the right to a speedy disposition of their
cases before all judicial, quasi-judicial, or administrative bodies.

The right to speedy disposition of cases may be invoked against all judicial, quasi-judicial or
administrative bodies, in civil, criminal, or administrative cases before them. Inordinate delay in the resolution
of cases warrant their dismissal. Delay, however, is not determined through simple mathematical reckoning but
through the examination of facts and circumstances surrounding each particular case.

Prevailing jurisprudence on the right to speedy disposition of cases is sourced from the landmark ruling
of the United States Supreme Court in Barker v. Wingo wherein a delicate balancing test was crafted to determine
whether said right had been violated.

The balancing test has four (4) factors:

1. length of delay,
2. the reason for the delay,
3. the defendant's assertion of his right, and
4. prejudice to the defendant.

In the present case, here all factors are evident. Firstly, as to the length of delay, it is undisputed that it
took more than seven years from the time AOM No. Dep Ed RO13-2009-003 was issued on February 17,
2009, until the COA promulgated its November 9, 2016 Decision against Rosario. Particularly, it took more
than five years from the time the case was elevated to the COA for automatic review before a decision was
rendered on November 9, 2016.

Secondly, The case was not inexplicably complex as the appeal contained the same arguments earlier
raised and exhaustively discussed in LAO-Corporate Decision No. 2008-046. There was therefore no reason
for the COA Proper to have taken six (6) years to resolve the same.

Thirdly, Rosario's actions, or inaction, did not amount to acquiescence. For during the six (6) years of
inaction on her part, she never knew that the case was ongoing as she had already resigned. The COA also
failed to notify her of the developments of the case much less seek her response thereto. Thus, Rosario did not
have any legitimate avenue to assert her fundamental right to speedy disposition of cases during the six (6) year
period.

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Lastly, COA's inexplicable delay of eleven (11) long years brought Rosario to a "roller coaster ride" of
emotions. The initial shock and dismay of finding out that she was liable after having been exonerated after
such a long time did not wear down and subjected her to constant distress and worry.

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BERNADETTE LOURDES B. ABEJO, EXECUTIVE DIRECTOR OF THE INTER-COUNTRY

ADOPTION BOARD (ICAB) v. COMMISSION ON AUDIT, REPRESENTED BY
CHAIRPERSON MICHAEL AGUINALDO
G.R. No. 254570, 29 June 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In reviewing the liability for the disallowed CNA Incentives, the legal framework established in Madera, et al. v. COA
provides guidance on the return of disallowed amounts. Specifically, the rules dictate that if a Notice of Disallowance is upheld,
approving and certifying officers who acted in good faith and with due diligence are not civilly liable to return the amounts. Conversely,
those who acted with bad faith, malice, or gross negligence are held solidarily liable for the return of the net disallowed amount.
Additionally, recipients of the disallowed funds are liable unless they prove the amounts were given for services rendered.

ICAB disputes the COA’s decision to disallow the CNA Incentives, arguing that the payments were made in accordance
with DBM BC No. 2006-1. However, the COA found that ICAB violated the circular by approving CNA Incentive payments
twice before the end of 2011 and exceeding the new limit set by DBM BC No. 2011-5. Despite these findings, ICAB argues that
she should not be held liable for returning the disallowed amount without evidence of gross negligence or bad faith.

FACTS
From 2008 to 2011, the Inter-Country Adoption Board (ICAB) granted Collective Negotiation
Agreement (CNA) Incentives to its employees based on the guidelines provided by the Department of Budget
and Management (DBM). Specifically, these incentives were governed by DBM Budget Circular (BC) No. 2006-
1, which stipulated that CNA Incentives should be awarded as a one-time benefit after the end of the fiscal
year, provided that all planned programs and activities had been successfully implemented. This circular
emphasized that the incentive should be a reward for the completion of annual targets and projects.

However, in December 2011, DBM issued BC No. 2011-5, which introduced a new restriction: the
CNA Incentive for each qualified employee could not exceed PHP 25,000.00. Prior to this circular, there was
no fixed cap on the amount of CNA Incentives; the amount granted was based on the agency’s annual savings
from cost-cutting and systems improvements.

In 2011, the ICAB made two payments of CNA Incentives: an initial payment in November 2011 and
a final payment in December 2011. This sequence of payments occurred before the end of the fiscal year and
resulted in the total CNA Incentive exceeding the Php 25,000 limit imposed by DBM BC No. 2011-5. The
ICAB argued that they had determined they had sufficient savings to make these payments and that the new
circular had not been issued or posted on the DBM website until January 2012, after the payments had been
made.

The Commission on Audit (COA) disallowed the excessive CNA Incentives totaling Php 236,500. The
COA affirmed that the ICAB had violated the circulars by paying CNA Incentives twice and exceeding the
prescribed limit. The COA also noted that ICAB’s Executive Director failed to prove that DBM BC No. 2011-
5 was only posted after the payments were made and emphasized that good faith was not a valid defense for
the disallowed amounts.

ISSUES

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(1) Did the decision of the COA validly disallow the payment of CNA Incentives to the qualified
employees of the ICAB?
(2) Is the approving authority, solidarity liable to refund the disallowed amount?
(3) As a recipient of the CNA Incentive, is the approving authority personally liable to return the alleged
excess amount she had received?

RULING
(1) YES. The disallowance of CNA Incentives rests on two key circulars issued by the DBM. DBM Budget
Circular No. 2006-1 specifies in Section 5.7 that CNA Incentives must be paid as a one-time benefit after the
end of the fiscal year. This rule ensures that incentives are distributed only after all performance targets and
program implementations for the year have been completed. Additionally, DBM Circular No. 2011-5, issued in
December 2011, imposed a new limit of Php 25,000.00 per employee for CNA Incentives, establishing a cap
to regulate the amount that could be granted.

In application to the case, the ICAB violated these provisions by approving CNA Incentive payments
in November 2011 and December 2011. These payments occurred before the end of the year, contrary to the
requirement in DBM BC No. 2006-1 that those payments be made only after the fiscal year concludes.

Furthermore, the total CNA Incentives paid exceeded the PHP 25,000.00 cap set by DBM BC No.
2011-5, which was issued just before the end of the year. Although ICAB argued that the issuance of DBM BC
No. 2011-5 was unforeseen, the core issue remains that the petitioner failed to adhere to the conditions outlined
in DBM BC No. 2006-1 and exceeded the new limit established by DBM BC No. 2011-5. Thus, the COA's
decision to disallow the excessive payments amounting to PHP 236,500.00 was justified given these regulatory
violations.

(2) NO. In reviewing the liability for the disallowed CNA Incentives, the legal framework established in
Madera, et al. v. COA provides guidance on the return of disallowed amounts. Specifically, the rules dictate that
if a Notice of Disallowance is upheld, approving and certifying officers who acted in good faith and with due
diligence are not civilly liable to return the amounts. Conversely, those who acted with bad faith, malice, or
gross negligence are held solidarily liable for the return of the net disallowed amount. Additionally, recipients
of the disallowed funds are liable unless they prove the amounts were given for services rendered.

ICAB disputes the COA’s decision to disallow the CNA Incentives, arguing that the payments were
made in accordance with DBM BC No. 2006-1. However, the COA found that ICAB violated the circular by
approving CNA Incentive payments twice before the end of 2011 and exceeding the new limit set by DBM BC
No. 2011-5. Despite these findings, ICAB argues that she should not be held liable for returning the disallowed
amount without evidence of gross negligence or bad faith.

The Court assesses the ICAB’s actions against the standard of gross negligence. Gross negligence is
characterized by a blatant disregard for duty and consequences, far beyond mere error or oversight. Here,
ICAB’s failure to comply with DBM BC No. 2006-1 before approving the payments does not reach the level
of gross negligence. Instead, it reflects an erroneous interpretation of the rules under circumstances where
DBM BC No. 2011-5 was issued late in the fiscal year, complicating the petitioner’s compliance efforts.

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ICAB’s belief that the ICAB’s savings could be used for CNA Incentives, despite being based on an
incorrect interpretation of DBM BC No. 2006-1, was not indicative of gross negligence. The absence of clear
jurisprudence at the time and the late issuance of DBM BC No. 2011-5 further support the petitioner’s position.
Thus, consistent with the principles established in Montejo, ICAB’s approving authority should be excused
from personal liability for the disallowed amount, as the errors made were not a result of gross negligence but
rather an honest misunderstanding of the applicable regulations.

(3) NO. In the case of Abellanosa v. COA, the Court refined the Rules on Return established in Madera, et
al. v. COA, particularly regarding the liability of recipients of disallowed amounts. The refined rules clarify that
to fall under Rule 2c—which excuses the return of amounts genuinely given in consideration of services
rendered—two requisites must be met:

(a) The incentive or benefit must have a proper legal basis but is only disallowed
due to procedural irregularities.
(b) There must be a clear, direct, and reasonable connection between the
incentive or benefit and the actual performance of the recipient's official
duties.

These refined parameters are designed to prevent the misuse of Rule 2c and ensure that it is applied
only in exceptional cases. This ensures that the general rule—requiring the return of disallowed public
expenditures—remains effective and not easily circumvented.

Applying this to the case at hand, ICAB’s approving authority is not liable to return the excess CNA
Incentive received. The CNA Incentive had a proper legal basis under DBM BC Nos. 2006-1 and 2011-5 but
was disallowed due to procedural irregularities. Moreover, the CNA Incentive was directly related to the actual
performance of the recipients' official duties, as it was granted following the completion of performance targets
and was funded by savings from cost-cutting measures. This aligns with the principle that disallowed amounts
should be returned only under specific conditions where the benefit or incentive was not genuinely linked to
official performance or authorized by law.

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MUNICIPALITY OF TUPI, REPRESENTED BY ITS MUNICIPAL MAYOR REYNALDO S.

TAMAYO, JR. v. HERMININIO F. FAUSTINO
G.R. No. 231896, 5 July 2021, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

To be valid and enforceable, an ordinance regulating land transportation and traffic rules must adhere to specific
requirements set forth by R.A. No. 4136. Key prerequisites include the classification of public highways by the local government
unit (LGU) according to Section 35, proper marking of these highways with visible signs, and obtaining approval from the LTO.
Additionally, the LGU must certify these classifications and markings to the LTO.

The subject Ordinance failed to meet these requirements as there was no evidence of highway classification, marking, or
LTO approval. Furthermore, the Ordinance did not comply with publication requirements, as previously mentioned, having neither
been published in a newspaper of general circulation nor posted in prominent locations as mandated. This lack of adherence to
procedural and substantive requirements rendered the Ordinance invalid and unenforceable.

FACTS
The Municipality of Tupi, led by Mayor Reynaldo S. Tamayo, Jr., enacted Ordinance No. 688
(Ordinance) in March 2014, to address high accident rates along the national highway between Crossing
Barangay Polonuling and Crossing Barangay Cebuano. This ordinance set speed limits for different sections of
the highway: 80 kilometers per hour (kph) from Crossing Polonuling to Crossing Acmonan and 40 kph from
Crossing Acmonan to Crossing Cebuano. It also established penalties for speeding, including fines and
imprisonment for repeated offenses.

In October 2014, Atty. Herminio B. Faustino (Faustino) was fined PHP 1,000 for speeding at 70 kph
in the 40 kph zone. Faustino paid the fine under protest and subsequently filed a petition challenging the
constitutionality of the ordinance in the Regional Trial Court (RTC). He argued that the ordinance was
unconstitutional due to its lack of publication, violating constitutional and statutory provisions. Atty. Faustino
sought a declaration of unconstitutionality, refunds of fines, and damages for the embarrassment and
humiliation he suffered. On its part, the Municipality of Tupi contended that the ordinance was valid and
aligned with Republic Act No. 4136's speed limit regulations.

In January 2016, the RTC declared the Ordinance of the Municipality of Tupi as void ab initio, meaning
it was invalid from the outset. The RTC also ordered the Municipality of Tupi to refund all fines collected under
this Ordinance and permanently enjoined its enforcement. The RTC reasoned that although the Ordinance was
in breach of R.A. No. 4136, its ongoing enforcement would lead to future violations due to conflicting speed
limits. However, the RTC did not declare the Ordinance unconstitutional, citing insufficient evidence or
arguments for such a declaration.

ISSUES
(1) Is a petition for declaratory relief the proper remedy at the first instance to assail the validity of the
Ordinance?
(2) Did the Ordinance comply with the publication requirement under the Local Government Code of
1991 (LGC)?
(3) Does the Ordinance violate R.A. No. 4136?
(4) Is the RTC’s directive for a refund of all fines thus far collected pursuant to the Ordinance proper?

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RULING
(1) NO. The petition for declaratory relief filed by the Faustino was deemed an inappropriate remedy
for challenging the validity of the Ordinance, which had already been enforced and penalties imposed.
According to the decision in Aquino v. Municipality of Malay, Aklan, declaratory relief is not viable once there
has been an actual breach or enforcement of the ordinance. This special writ is designed to secure a preemptive
authoritative statement on rights or obligations under a statute, ordinance, or regulation and is not suitable for
resolving disputes arising from breaches.

In this case, because the Ordinance had already been implemented and fines had been collected, the
proper remedy was a petition for certiorari or prohibition, not declaratory relief. Department of Transportation
et al. v. Philippine Petroleum Sea Transport Association et al. clarified that certiorari and prohibition are
appropriate for correcting errors of jurisdiction or grave abuse of discretion by government branches, including
local government units. These remedies are broader and can address actions seriously alleged to violate
constitutional or legal principles.

Although the Municipality of Tupi chose the wrong procedural remedy, the Court decided to treat the
petition as one for certiorari and prohibition, as all essential allegations challenging the ordinance's validity had
been presented. This approach allows the Court to resolve the underlying issues despite procedural missteps.

(2) NO. The Ordinance was found invalid due to non-compliance with publication requirements
mandated by the LGC. According to Section 59 of the LGC, ordinances with penal sanctions must be published
in a newspaper of general circulation within the province. If no such newspaper is available, posting in
prominent locations within all municipalities and cities in the province is required. Additionally, Section 511
emphasizes that ordinances with penal sanctions must be posted for three consecutive weeks and, where
possible, published in a newspaper of general circulation.

The Ordinance, in this case, only satisfied the posting requirement, specifying that it would take effect
after 15 days of posting in three conspicuous places. However, it failed to meet the publication requirement
because there was no evidence of publication in a newspaper, nor did Tupi provide proof that such a newspaper
was unavailable. The Tupi also did not seek an exemption based on the absence of a newspaper.

In Coca-Cola Bottlers Philippines, Inc. v. City of Manila, the Court invalidated a tax ordinance for
similar reasons, stressing that publication is essential to notify the public and entities affected by new measures.
Without proper publication, as seen with Ordinance No. 688, the relevant parties—such as vehicle owners and
drivers—were not informed of the speed limits. Consequently, the Ordinance did not become effective or
enforceable due to its failure to comply with the publication requirements.

(3) YES. To be valid and enforceable, an ordinance regulating land transportation and traffic rules
must adhere to specific requirements set forth by R.A. No. 4136. Key prerequisites include the classification of
public highways by the local government unit (LGU) according to Section 35, proper marking of these highways
with visible signs, and obtaining approval from the LTO. Additionally, the LGU must certify these
classifications and markings to the LTO.

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The Ordinance failed to meet these requirements as there was no evidence of highway classification,
marking, or LTO approval. Furthermore, the Ordinance did not comply with publication requirements, as
previously mentioned, having neither been published in a newspaper of general circulation nor posted in
prominent locations as mandated. This lack of adherence to procedural and substantive requirements rendered
the Ordinance invalid and unenforceable.

The Court’s decision in Primicias v. Municipality of Urdaneta highlights the necessity of these
procedural steps and underscores that municipal ordinances must align with national statutes. Consequently,
despite the intentions behind the Ordinance, its procedural lapses necessitated its invalidation.

(4) NO. As a rule, a claim for damages cannot be joined with an action for declaratory relief. This
principle is reflected in the procedural rules governing actions and petitions. Specifically, Rule 65 of the Rules
of Court (Rules) provides for petitions for certiorari and prohibition to challenge acts of tribunals, boards, or
officers that are alleged to be without or in excess of jurisdiction or marked by grave abuse of discretion. Unlike
these, petitions for mandamus explicitly allow the joinder of claims for damages, addressing situations where a
party seeks to compel the performance of a duty and also seeks compensation for damages sustained due to
the Faustino’s wrongful acts.

In the case of the Ordinance, although the primary relief sought was the nullification of it, Atty.
Faustino’s prayer for a refund of the fine imposed under the Ordinance can be considered an incidental relief.
Incidental reliefs are those that are ancillary to the principal relief and are necessary to fully resolve the issues
at hand. Here, if the Ordinance is declared invalid, the fine collected under it was also collected illegally. Thus,
the refund of the PHP 1,000.00 fine is a logical consequence of the declaration of the Ordinance's invalidity.

However, the RTC erred in extending this relief to all other fees collected from other motorists. Atty.
Faustino did not represent a class or act on behalf of other fined individuals, and there was no evidence
regarding the personal circumstances of these other individuals who were fined. The Rules require that all
interested parties must be properly joined in the petition to benefit from its resolution. Since the other
individuals were not joined as parties and their personal circumstances were not presented, the trial court's
directive to refund all such fees was improper.

Regarding the application of the operative fact doctrine, which allows certain effects of a void act to
be recognized to avoid unjust consequences, it does not apply here. The doctrine is an exception to the general
rule that a void act has no legal effect. It may be invoked only if nullifying the effects would result in inequity
or injustice. In this case, no party raised the operative fact doctrine, and there was no reliance by the public on
the Ordinance in good faith. The fines collected were monetary and thus can be refunded without undue
difficulty. Therefore, applying the doctrine of operative fact would not be appropriate here, and the refund of
the fine to the respondent is justified.

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GLADYS MINERVA N. BILIBLI, DARROW P. ODSEY, AND ZENAIDA BRIGIDA H. PAWID

v. COMMISSION ON AUDIT
G.R. No. 231871, 06 July 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

A valid transfer of appropriated funds requires the concurrence of the following conditions:
a. There is a law authorizing the President, the President of the Senate, the Speaker of the House of
Representatives, the Chief Justice of the Supreme Court, and the heads of the Constitutional Commissions to
transfer funds within their respective offices;
b. The funds to be transferred are savings generated from the appropriations for their respective offices; and
c. The purpose of the transfer is to augment an item in the general appropriations law for their respective offices.

Here, the so-called augmentation of the NCIP's scholarship program is utterly devoid of legal basis. Consequently, the COA
Proper did not commit grave abuse of discretion when it sustained the Notice of Disallowance No. 2013-001 issued by the COA
Audit Team corresponding to PHP 1,462,358.04, the amount paid by NCIP to the ADMU.

FACTS
Gladys Minerva N. Bilibli, Darrow P. Odsey, and Zenaida Brigida H. Pawid (Bilibli et al.) are officials
of the National Commission on Indigenous Peoples (NCIP).

The NCIP Board of Trustees authorized a scholarship program at Ateneo de Manila University
(ADMU) for 24 NCIP officials and employees through a resolution, funded by realigning unutilized funds from
the 2011 budget.

The Commission on Audit (COA) issued Notice of Disallowance No. 2013-001, citing irregularities
such as the lack of an approved Annual Procurement Plan, absence of public bidding, and the scholarship
program not being included in the 2012 budget.

The COA-National Government Sector (NGS) and COA En Banc affirmed the disallowance, holding
the NCIP officers liable.

Bilibli et al. argued that the scholarship program was part of their Human Resource Development Plan
and that they acted in good faith. On the other hand, the COA maintained that the scholarship program was
not legally funded by augmentation from reprogrammed funds.

ISSUES
(1) Did the COA gravely abuse its discretion when it affirmed the Notice of Disallowance?
(2) Are Bilibli et al. liable to refund the full disallowed amount?

RULING
(1) NO. A valid transfer of appropriated funds requires the concurrence of the following conditions:

a. There is a law authorizing the President, the President of the Senate, the Speaker of the
House of Representatives, the Chief Justice of the Supreme Court, and the heads of the
Constitutional Commissions to transfer funds within their respective offices;

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b. The funds to be transferred are savings generated from the appropriations for their
respective offices; and
c. The purpose of the transfer is to augment an item in the general appropriations law for
their respective offices.

Here, the so-called augmentation of the NCIP's scholarship program is utterly devoid of legal basis.
Consequently, the COA Proper did not commit grave abuse of discretion when it sustained the Notice of
Disallowance No. 2013-001 issued by the COA Audit Team corresponding to PHP 1,462,358.04, the amount
paid by NCIP to the ADMU.

(2) YES. In Abellanosa, the Court cautioned that the excuse to return disallowed amounts under Rule
2d of the Madera Rules "must constitute a bona fide instance which strongly impels the Court to prevent a
clear inequity arising from a directive to return."

In this case, the disallowed amounts ultimately redound to the benefit of the NCIP, more particularly, as
payment of its 24 officials and employees/scholars. It is discerned that NCIP is a sui generis government agency
that came about as a result of the promise of the State to recognize indigeneity with both respect and pride as
a fundamental element of nation building and national consciousness and as a social justice measure to correct
past mistakes of prejudice and discrimination against indigenous peoples. The protection of the rights of
indigenous peoples carries with it significant social justice considerations, which, in turn, necessitates the
development and empowerment of NCIP's officials, at least insofar as the peculiar facts of this case are
concerned.

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VICENTE J. CAMPA, JR. and PERFECTO M. PASCUA v. HON. EUGENE C. PARAS,

PRESIDING JUDGE, RTC, BR. 58, MAKATI CITY and PEOPLE OF THE PHILIPPINES
G.R. No. 250504, 12 July 2021, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

To aid the courts in determining whether there is inordinate delay our jurisdiction has adopted the Balancing Test as
established in the case of Cagang v. Sandiganbayan which involves the assessment of four (4) criteria: first, the length of the delay;
second, the reason for the delay; third, the defendant’s assertion or non-assertion of his or her right; and fourth, the prejudice to the
defendant because of the delay.

Applying the Balancing test, the Supreme Court found that there was inordinate delay. First, it is undisputed that the
DOJ took about ten (10) years and five (5) months from filing of the complaint before it issued a Resolution dated 08 February
2019 finding probable cause to indict Campa, Jr. and Pascua. Second, the delay was purely imputable on the prosecution and
Campa, Jr. and Pascua did not cause or contributed to the delay. Third, Campa, Jr. and Pascua had actually timely assailed the
subject resolution through a Manifestation with Motion to Adopt and Entry of Appearance with Motion to Dismiss. Moreover,
when the trial court denied their motions, Campa, Jr. and Pascua did not take much time on assailing the Orders of denial through
the present Petition for Certiorari. Fourth, Campa, Jr. and Pascua were unduly prejudiced by the ten (10) – year delay because
access to records and contact to witnesses could prove to be too difficult to effectively defend themselves in trial.

FACTS
On 12 September 2007, the Bangko Sentral ng Pilipinas (BSP) filed a complaint before the DOJ against
the officers of Bank Wise, Inc. including Vicente Campa, Jr. (Campa, Jr.) and Perfecto Pascua (Pascua) and five
others, for violation of Monetary Board Resolution No. 1460 in relation to Section 3, Republic Act No. 7653
(R.A. No. 7653). In the complaint, the BSP charged Campa, Jr., et al. with issuing unfunded manager’s checks
and failing to present documents to support the bank’s disbursements in acquiring assets. After due
proceedings, the case was deemed submitted for resolution on 29 August 2008.

More than ten (10) years thereafter, the Department of Justice (DOJ) found probable cause to hold
Campa, Jr. and Pascua. for the offense charged as indicated under Resolution dated 08 February 2019. The
DOJ then filed before the Regional Trial Court (RTC) eleven (11) Informations against Campa, Jr. and five (5)
against Pascua for violation of Monetary Board Resolution No. 1460 in relation to Section 3, R.A. No. 7653.

By filing Manifestation with Motion to Adopt and Entry of Appearance with Motion to Dismiss,
Campa Jr. and Pascua sought the dismissal of the cases before the trial court on the ground of inordinate delay.
According to them, the unreasonable length of the investigation before the DOJ violated their right to speedy
disposition of their cases as enshrined under Section 16, Article III of the 1987 Constitution. The RTC ruled
that the delay of ten (10) years and five (5) months was neither vexatious, capricious, nor oppressive and may
be attributed to the complexity of the case which involved voluminous documents. After their motion for
reconsideration was denied, Campa, Jr. and Pascua filed the present petition for certiorari before the Supreme
Court.

ISSUES
(1) Did the delay in the preliminary investigation before the DOJ violate Campa, Jr. and Pascua’s
constitutional right to a speedy disposition of their cases?

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(2) Did the RTC act in grave abuse of discretion when it denied Campa, Jr. and Pascua’s motion to dismiss
and/or quash?

RULING
(1) YES. The right to speedy disposition of cases under Section 16, Art. III of the 1987 Constitution
may be invoked against all judicial, quasi-judicial or administrative bodies, in civil, criminal, or administrative
cases before them and inordinate delay in the resolution of cases warrant their dismissal. Delay is determined
through the examination of the facts and circumstances surrounding each case, not through the mere
mathematical reckoning.

To aid the courts in determining whether there is inordinate delay our jurisdiction has adopted the
Balancing Test as established in the case of Cagang v. Sandiganbayan which involves the assessment of four (4)
criteria: first, the length of the delay; second, the reason for the delay; third, the defendant’s assertion or non-
assertion of his or her right; and fourth, the prejudice to the defendant because of the delay.

Applying the Balancing test, the Supreme Court found that there was inordinate delay.

First, it is undisputed that the DOJ took about ten (10) years and five (5) months from filing of the
complaint on 12 September 2007 before it issued a Resolution dated 08 February 2019 finding probable cause
to indict Campa, Jr. and Pascua for violation of Monetary Board Resolution No. 1460 in relation to Section 3,
R.A. No. 7653. Second, the delay was purely imputable on the prosecution and Campa, Jr. and Pascua did not
cause or contributed to the delay. Third, Campa, Jr. and Pascua had actually timely assailed the subject resolution
through a Manifestation with Motion to Adopt and Entry of Appearance with Motion to Dismiss. Moreover,
when the trial court denied their motions, Campa, Jr. and Pascua did not take much time on assailing the Orders
of denial through the present Petition for Certiorari. Fourth, Campa, Jr. and Pascua were unduly prejudiced by
the ten (10) – year delay because access to records and contact to witnesses could prove to be too difficult to
effectively defend themselves in trial.

(2) YES. Grave abuse of discretion is the capricious or whimsical exercise of judgment equivalent to
lack or excess of jurisdiction and is required to be so patent and gross as to amount to an evasion of a positive
duty or to a virtual refusal to perform a duty enjoined by law, as where the power is exercised in an arbitrary
and despotic manner by reason of passion and hostility.

In this case, Campa, Jr. and Pascua sufficiently established that the trial court acted in grave abuse of
discretion. Procedural rules are clear on the periods for resolving cases and jurisprudence provides analogous
situations on which the trial court could have based its rulings. In spite of these, the trial court denied Campa,
Jr. and Pascua’s motions without properly determining the existence of inordinate delay by applying the balance
test in accordance with Cagang v. Sandiganbayan. If the trial court otherwise applied the same, it would have
discovered for itself that inordinate delay had indeed attended the DOJ investigation and that Campa, Jr. and
Pascua’s right to speedy disposition of their cases had been violated.

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NOEL T. JASPE et al. v. PUBLIC ASSISTANCE AND CORRUPTION PREVENTION OFFICE

AND AGUSTIN SONZA, JR.
G.R. No. 251940, 12 July 2021, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 26 of RA No. 9184 provides that a bidder may modify his bid, provided that this is done before the deadline
for the receipt of bids. The modification shall be submitted in a sealed envelope duly identified as a modification of the original bid
and stamped received by the BAC. A bidder may, through a letter, withdraw his bid or express his intention not to participate in
the bidding before the deadline for the receipt of bids. In such case, he shall no longer be allowed to submit another Bid for the same
contract either directly or indirectly.

Here, to begin with, the application of Section 26 is patently erroneous, if not totally misplaced. For there is no modification
or withdrawal of bids to speak of in this case. As borne by the Minutes of Opening of bids and Abstract of Bid as Read, AFG
did not bid on any of the five projects, TDMC bid for three projects while FGCI bid for two. In their respective letters, they gave
the reason why they were not bidding for the other projects they had identified. TDMC, and FGCI each explained that the estimated
costs for the projects exceeded the ABC while AFG failed to complete the bidding documents in time. From these undisputed facts,
it is plainly illogical to infer an act of illegality or immorality against AFG, TDCM, and FGCI.

At any rate, since there is no modification or withdrawal of bids to speak of here, Section 26 is not relevant to the
resolution of this case, specifically in determining whether the BAC members committed grave misconduct in the performance of their
duty.

FACTS
The Municipality of Sta. Barbara, Iloilo (Municipality) conducted a bidding for its five infrastructure
projects, namely: Concreting of Libertad and Arroyo Streets; Asphalt Overlaying of Castilla Street; Concreting
of Sodusta Street; Asphalting or Arroyo Street; and Construction of Fish Section Building.

Three bidders secured bid documents for the said five projects, namely: Topmost Development and
Marketing Corporation (TDMC); F. Gurrea Construction, Incorporated (FGCI)l; and AFG Construction and
Construction Supply (AFG).

The Bids and Awards Committee (BAC) of the Municipality were composed of Lyndofer V. Beup
(Beup) as Chairman, Noel T. Jaspe (Jaspe), as Vice Chairman, and Negegina V. Araneta (Araneta), Sanny
Apuant (Apuang), and Genaro Sonza (Sonza) as members.

At the start of the scheduled opening of bids, AFG verbally informed BAC that it was not bidding for
all five infrastructure projects, and that its formal notice would follow. During the bidding process, BAC found
a letter from TDMC, enclosed in their bid envelope, wherein it informed them that it was not bidding for the
Asphalting Overlay of Sodusta Street and Asphalting of Arroyo Street because the estimated costs exceeded
the approved budget of contracts (ABC). Likewise, BAC found another letter, in another bid envelope, wherein
FGCI informed them that it was not bidding for the Concreting of Libertad and Arroyo Street, Concreting of
Sodusta Street and Construction of Fish Section Building.

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Sonza questioned the withdrawal of TDMC and FCGI who did not manifest the same at an earlier
date. He alluded to the fact that the withdrawal was part of the bidder’s internal sharing scheme on the projects,
thus he recommended that the BAC declare a failure of bidding. In response, Beup mentioned that according
to Section 36 (c) of Republic Act No. 9184 (RA 9184), a single calculated bidder is allowed, and that although
a bidder may have submitted its letter of intent and even passed the eligibility stage, it is still possible that the
bidder, on the day of the bidding, may decide to bid only for certain projects. In line with the foregoing, Jaspe
moved for the continuation of the bids.

Eventually, BAC declared TDMC as the lone bidder for the Concreting of Libertad and Arroyo Sts.
Concreting of Sodusta Street and Construction of Fish Section Building; and further declared that FGCI as the
lone bidder for the Asphalting Overlay of Castilla Street and Asphalting of Arroyo Street. In response to the
said outcome, Sonza filed before the Office of the Ombudsman (OMB) a letter complaint arguing that there
had been irregularities in the bidding of the five construction projects. He suggests that Beup conspired with
TDMC and FGCI to ensure the award of contracts to these countries.

In a fact-finding report made by the Commission on Audit (COA), it found that BAC allowed the
belated withdrawal of bids after the deadline of the submission and receipt of bids which constitutes a violation
of Section 26 of RA No. 9184. As such, Graft Investigation and Prosecution Office Theodore P. Banderado
(GIPO Banderado) filed a complaint for grave misconduct against Apuang, Japse, and Araneta (Jaspe et al.).
According to GIPO Banderado, the withdrawal of the bids made by AFG, TDMC and FCGI was void because
it deviated from the prescribed procedure of RA No. 9184, and despite such patent irregularity, the BAC
members proceeded to open the bids which eventually led to the award of contracts to TDMC and FGCI.
Ultimately, GIPO Banderado claims that the BAC members were deemed to have conspired with and given
unwarranted benefits to these two companies.

In its decision, the OMB found Jaspet et al. liable for grave misconduct and imposed the penalty of
dismissal from the service. According to the OMB, Jasper et al. violated the procurement rules when they
allowed the bidders to withdraw their bids in violation of the prescribed procedure under RA No. 9184. For
intentionally disregarding the procurement rules, they were deemed to have conspired with the winning bidders
to ensure that the latter got the projects in accordance with their sharing scheme. As a result, the government
was deprived of the benefits of competitive bidding. On appeal before the Court of Appeals (CA), the OMB’s
decision was affirmed.

Hence, the present petition before the Supreme Court. According to Jasper at el., there was no
withdrawal to speak in the first place since the bidders did not bid for certain identified projects; that even then,
the bidders substantially complied with the rules when they submitted their letters not to bid. The BAC arrived
at a collegial decision to allow the bidding to proceed which was done in good faith.

ISSUE
Did Jasper et al. commit grave misconduct?

RULING
NO. Grave misconduct is defined as the "wrongful, improper or unlawful conduct motivated by a
premeditated, obstinate or intentional purpose." It is not mere failure to comply with the law. Failure to comply
must be deliberate and must be done in order to secure benefits for the offender or for some other person.

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For a charge of grave misconduct or any grave offense to prosper, therefore, the evidence against the
respondent should be competent and must be derived from direct knowledge. Reliance on mere allegations,
conjectures and suppositions, as in this case, warrants the dismissal of the charge. So must it be.
Section 26 of RA No. 9184 provides that a bidder may modify his bid, provided that this is done before
the deadline for the receipt of bids. The modification shall be submitted in a sealed envelope duly identified as
a modification of the original bid and stamped received by the BAC. A bidder may, through a letter, withdraw
his bid or express his intention not to participate in the bidding before the deadline for the receipt of bids. In
such case, he shall no longer be allowed to submit another Bid for the same contract either directly or indirectly.

Here, to begin with, the application of Section 26 is patently erroneous, if not totally misplaced. For
there is no modification or withdrawal of bids to speak of in this case. As borne by the Minutes of Opening of
bids and Abstract of Bid as Read, AFG did not bid on any of the five projects, TDMC bid for three projects
while FGCI bid for two. In their respective letters, they gave the reason why they were not bidding for the
other projects they had identified. TDMC, and FGCI each explained that the estimated costs for the projects
exceeded the ABC while AFG failed to complete the bidding documents in time. From these undisputed facts,
it is plainly illogical to infer an act of illegality or immorality against AFG, TDCM, and FGCI.

At any rate, since there is no modification or withdrawal of bids to speak of here, Section 26 is not
relevant to the resolution of this case, specifically in determining whether the BAC members committed grave
misconduct in the performance of their duty. In other words, the adverse findings of the OMB and the CA
against Jaspe et al., derived as they were from a forced or misplaced application of Section 26 should be struck
down.

Specifically, the Supreme Court reject the baseless, nay, illogical finding that since the BAC members
supposedly deviated from Section 26, they were deemed to have colluded with the winning bidders to
manipulate the bidding process in order to give undue advantage to the latter and consequently deprive the
government of the benefit of the bidding process.

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CIVIL SERVICE COMMISSION v. MARILOU T. RODRIGUEZ

G.R. No. 248255, 27 August 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In the case of Bacsasar v. Civil Service Commission, the Court discussed the concept of good faith. Accordingly, good faith
refers to an honest intention and a lack of knowledge about circumstances that should prompt further inquiry. It means abstaining
from exploiting others unfairly, even through legal technicalities. Essentially, good faith concerns a person's intention, which is best
determined by their actions and conduct rather than their self-reported intentions.

Rodriguez’s repeated falsification of Personal Data Sheets from 1989 to 2000, claiming to be a registered nurse,
constitutes serious dishonesty. Dishonesty in this context involves intentionally making false statements or attempting to deceive in
securing examination, appointment, or registration. Her use of fake documents to secure employment and promotions at the Davao
Oriental Provincial Hospital, as well as her unauthorized practice of nursing, not only prejudiced other qualified applicants but
also endangered patients' lives. Her actions, including the falsification of public records, tarnished the image and integrity of public
service.

FACTS
In June 1988, Marilou Rodriguez (Rodriguez) took the Nursing Licensure Examination (NLE) in
Manila but did not pass. Despite this, she applied and was accepted as a staff nurse at the Davao Oriental
Provincial Hospital in 1989, using a forged PRC Identification Card and a false passing grade of 79.6%. She
consistently claimed to be a registered nurse with a valid license in her Personal Data Sheets (PDSs) until 2002,
when she resigned after discovering her PRC card was fake. Rodriguez later worked abroad and eventually
passed the NLE in 2009. She returned to the country for good and then applied and was appointed as a nurse
at the Office of City Health Officer, Mati, Davao Oriental.

In 2014, Rodriguez received a Show Cause Order from the Civil Service Commission (CSC) Regional
Office No. XI for falsifying official documents and claiming to be a registered nurse. An investigation revealed
that the PRC Identification Card number she had used actually belonged to someone else. Despite her claims
of good faith, citing misinformation from a person named “Evelyn Sapon,” she did not comply with the show
cause order or provide evidence to refute the accusations.

The CSC Regional Office No. XI found Rodriguez guilty of serious dishonesty, grave misconduct,
conduct prejudicial to the best interest of the service, and falsification of official documents. As a result, she
was dismissed from service, with additional penalties including the cancellation of eligibility, forfeiture of
retirement benefits, and perpetual disqualification from holding public office and taking civil service
examinations.

The Court of Appeals (CA) initially determined that the charges against Rodriguez were not rendered
moot by her prior resignation from government service in 2002, as her re-entry into public service in 2013
subjected her to the jurisdiction of the CSC and the courts. However, the CA absolved Rodriguez of
administrative liability, granting her the benefit of good faith due to her resignation and admission that the PRC
Identification Card used in her PDSs from 1989 to 2000 was fake. The CA also noted her demonstrated
remorse.

ISSUE

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Did the Court of Appeals erred in absolving Rodriguez from any liability for using a fake NLE rating
and PRC Identification Card and for falsely declaring in her PDSs that she was a registered nurse during the
relevant years?

RULING
YES. In the case of Bacsasar v. Civil Service Commission, the Court discussed the concept of good faith.
Accordingly, good faith refers to an honest intention and a lack of knowledge about circumstances that should
prompt further inquiry. It means abstaining from exploiting others unfairly, even through legal technicalities.
Essentially, good faith concerns a person’s intention, which is best determined by their actions and conduct
rather than their self-reported intentions.

In this case, Rodriguez’s claim of good faith is unsupported. Upon learning that her name was not on
the list of successful examinees for the 1988 NLE, she relied on a person named “Evelyn Sapon,” who allegedly
claimed that her name was on a “deferred status” list, requiring only a “processing fee” and “lacking
documents” to clear her status. However, the governing law, R.A. No. 4704, or the Amendments to the
Philippine Nursing Law, does not provide for a “deferred status.”

Rodriguez’s subsequent silence and inaction, despite allegedly receiving a fake PRC Identification Card
and a passing grade of 79.6% from “Evelyn Sapon,” further discredit her claim of good faith. During the
investigation, it was revealed that the PRC Identification Card actually belonged to “Ella S. Estopo,” not to
Rodriguez. Despite her assertion of ignorance, her use of fake documents to practice nursing from 1989 to
2002 without a valid certificate of registration as required by R.A. No. 877, also known as the Philippine Nursing
Law, demonstrates grave misconduct.

Rodriguez’s repeated falsification of PDSs from 1989 to 2000, claiming to be a registered nurse,
constitutes serious dishonesty. Dishonesty in this context involves intentionally making false statements or
attempting to deceive in securing examination, appointment, or registration. Her use of fake documents to
secure employment and promotions at the Davao Oriental Provincial Hospital, as well as her unauthorized
practice of nursing, not only prejudiced other qualified applicants but also endangered patients’ lives. Her
actions, including the falsification of public records, tarnished the image and integrity of public service. Thus,
she was found guilty of serious dishonesty, grave misconduct, and conduct prejudicial to the best interest of
the service, warranting appropriate sanctions.

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LAND BANK OF THE PHILIPPINES v. MILAGROS DE JESUS-MACARAEG

G.R. No. 244213, 14 September 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The RTC-SAC enjoys original and exclusive jurisdiction to determine just compensation for lands acquired for purposes
of agrarian reform. In fixing just compensation, however, RTC-SAC must take into consideration the factors enumerated under
Section 17 of RA 6657 or the Comprehensive Agrarian Reform Law of 1988.

Through the aforementioned formulas, consequently, the Court arrives at the total land value of P777,880.40.

Further, in the case of Land Bank of the Philippines v. Uy, citing Apo Fruits Corporation v. Land Bank of the
Philippines, the Supreme Court elucidates that the concept of just compensation embraces not only the correct determination of the
amount to be paid to the owners of the land, but also payment within a reasonable time from its taking.

Here, Land Bank had already paid 1,472,382.33 to Milagros by depositing the same in her name. Deducting this
amount from P777,880.40 would leave a balance of P305,498.07 on which the legal interest should be imposed in accordance
with Nacar v. Gallery Frames, however, the Court adjusts the interest rate to twelve percent legal interest per annum from March
3, 2003 until June 30, 2013 and thereafter, to six percent legal interest per annum until fully paid.

FACTS
Milagros De Jesus-Macaraeg (Milagros) is the registered owner of a parcel of land located in Davao
City.

In 2002, part of the subject land was placed under the Comprehensive Agrarian Reform Program
(CARP) and were valued with a total of P472,383.33 in accordance with the basic formula provided under
Department of Agrarian Reform (DAR) Administrative Order No. 5 (DAR AO5) series of 1998. Land Bank
of the Philippines (Landbank) offered the aforesaid amount to Milagros, albeit the latter rejected the offer. Land
Bank then deposited the amount under the name of Milagros.

An administrative proceeding before the DAR Adjudication Board (DARAB) was conducted to fix
the amount of just compensation. The DAR Adjudicator valued the property at a higher value. Land Bank's
motion for reconsideration was denied. Aggrieved, Land Bank brought the case to the Regional Trial Court
sitting as Special Agrarian Court (RTC-SAC).

However, Land Bank did not appear during the scheduled hearing for presentation of its evidence. On
the other hand, Milagros presented her valuation of P3,055,000.00 per appraisal of Asian Appraisal Corp. which
she engaged for the purpose. Milagros also offered the testimony of her husband, Ramon Macaraeg (Ramon)
who is the head of technical service unit of the Alcantara group which claimed to have conducted a study on
the property's pineapple production in the year 2002. According to Ramon, the average production of pineapple
then was 46,666 kilos per hectare and that the average price of pineapples based on agricultural statistics was
P15.00 per kilo.

On March 3, 2003, Milagros withdrew the initial deposit of just compensation made by Land Bank.

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The RTC-SAC ordered Land Bank to pay Milagros 2,765,727.08 as just compensation, with twelve
percent (12%) interest per annum until fully paid.

The Court of Appeals (CA) reversed the decision of the RTC-SAC and ruled that the Selling Price (SP)
fixed by the RTC-SAC was arbitrary. Consequently, the CA reduced the SP based on Land Bank's initial offer
and adjusted the Market Value. Nevertheless, the CA affirmed the Annual Gross Production (AGP) and the
award of legal interest albeit at the reduced rate of six percent per annum in accordance with Nacar v. Gallery
Frames.

ISSUES
(1) Did the CA erred in its computation of the just compensation?
(2) Did the CA erred in imposing legal interest on the balance owed to Milagros?

RULING
(1) YES. The RTC-SAC enjoys original and exclusive jurisdiction to determine just compensation for
lands acquired for purposes of agrarian reform. In fixing just compensation, however, RTC-SAC must take
into consideration the factors enumerated under Section 17 of RA 6657 or the Comprehensive Agrarian Reform
Law of 1988.

These factors have been translated into a basic formula under DAR AO5, viz:

A. There shall be one basic formula for the valuation of lands covered by [Voluntary Offer to Sell]
VOS or [Compulsory Acquisition] CA:

LV = (CNI x 0.6) + (CS x 0.3) + (MV x 0.1)

Where: LV = Land Value

CNI = Capitalized Net Income
CS = Comparable Sales
MV = Market Value per Tax Declaration

The above formula shall be used if all the three factors are present, relevant, and applicable.

Further, among others, A.1 When the CS factor is not present and CNI and MV are applicable, the
formula shall be:

LV = (CNI x 0.9) + (MV x 0.1)

Verily, the default formula is LV = (CNI x 0.6) + (CS x 0.3) + (MV x 0.1). The formula adjusts,
however, when one or two of the factors other than MV are missing or otherwise inapplicable. In this case due
to the absence of data for CS, the following formula shall govern:

Land Valuation = (Capitalized Net Income x 0.9) + (Market Value x 0.1)

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Notably, neither Land Bank nor Milagros assails the MV set by the CA; hence, the Court now focuses
on the computation of the CNI.

Under DAR AO5, the CNI is computed as follows:

CNI = (AGP x SP – CO)
––––––––––––––
0.12

Where:
CNI = Capitalized Net Income
AGP = Annual Gross Production corresponding to the latest available 12-months' gross production
immediately preceding the date of [Field Investigation (FI)].
SP = The average of the latest available 12-months' selling prices prior to the date of receipt of the CF
by the LBP for processing, such prices to be secured from the Department of Agriculture (DA) and
other appropriate regulatory bodies or, in their absence, from the Bureau of Agricultural Statistics. If
possible, SP data shall be gathered for the barangay or municipality where the property is located. In
the absence thereof, SP may be secured within the province or region.
CO = Cost of Operations
0.12 = Capitalization Rate

Here, the CA used 46,666 kilos per hectare as the AGP of the subject property. But as correctly argued
by Land Bank, this figure was unverified. In stark contrast, Land Bank obtained data from the BAS.

Through the aforementioned formulas, consequently, the Court arrives at the total land value of
P777,880.40.

(2) NO. In the case of Land Bank of the Philippines v. Uy, citing Apo Fruits Corporation v. Land Bank of the
Philippines, the Supreme Court elucidates that the concept of just compensation embraces not only the correct
determination of the amount to be paid to the owners of the land, but also payment within a reasonable time
from its taking. Thus, when property is taken, full compensation of its value must immediately be paid to
achieve a fair exchange for the property and the potential income lost. If full compensation is not paid for the
property taken, then the State must make up for the shortfall in the earning potential immediately lost due to
the taking, and the absence of replacement property from which income can be derived; interest on the unpaid
compensation becomes due as compliance with the constitutional mandate on eminent domain and as a basic
measure of fairness.

Here, Land Bank had already paid 1,472,382.33 to Milagros by depositing the same in her name. In
fact, Milagros withdrew this initial deposit in March 2003 even before Land Bank took possession of the
property. Deducting this amount from P777,880.40 would leave a balance of P305,498.07 on which the legal
interest should be imposed in accordance with Nacar v. Gallery Frames, however, the Court adjusts the interest
rate to twelve percent legal interest per annum from March 3, 2003 until June 30, 2013 and thereafter, to six
percent legal interest per annum until fully paid.

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SILVERIO REMOLANO v. PEOPLE OF THE PHILIPPINES

G.R. No. 248682, 06 October 2021, FIRST DIVISION (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

One of the fundamental rights of the accused is the constitutional right of the accused to be informed of the nature and
cause of accusation against him or her, a right which comes to life during the arraignment. Thus, when the allegations in the
Information are read to the accused during the arraignment, the accused is consequently informed of the crime charged, its essential
elements, and the manner of the commission thereof imputed on him or her. The ultimate purpose is to enable the accused to prepare
for his or her defense based on the recitals of the Information read to him. It goes without saying, therefore, that the prosecution must
also establish its case on the basis of the same Information read to the accused, who as such, may only be convicted of the crime
charged and proved.

Here, the crime of direct bribery is not covered by Remolano’’s indictment for the crime of robbery. Remolano, therefore,
cannot be convicted of direct bribery. The variance between the allegations contained in the Information and the conviction resulting
from trial will justify a conviction for either the offense charged or the offense proved only if either is included in the other. To convict
Remolano for direct bribery, as the Court of Appeals (CA) did, violates the proscription found in the Constitution and our own
Rules on Criminal Procedure.

FACTS
Metro Manila Development Authority (MMDA) Traffic Aides Silverio Remolano (Remolano) and his
co-accused Rolando Tamor (Tamor) were found to be engaging in extortion activities. They would not issue
traffic violation tickets to motorists they flagged, in exchange for money surreptitiously handed to them. During
an entrapment operation, a police officer posed as a civilian motorist and was flagged down by the Remolano
for illegal swerving. When the police officer told Remolano to pardon him for the violation, Remolano replied,
“Sige pagbibigyan kita pero bahala ka na sa amin ng kabuddy ko. Kahit magkano lang.” The police officer handed him
two (2) Php 100.00 bills marked money. This prompted his team members to arrest Remolano and Tamor. The
team informed them of their constitutional rights. They were brought to the police station where Remolano’s
hands were tested and found positive for the presence of the powder which came from the marked money.
Remolano denied doing so and claimed that the police officer posing as a civilian motorist suddenly handed
him the money which he refused.

The Regional Trial Court (RTC) convicted Remolano of the crime of Robbery under paragraph 5,
Article 294 of the Revised Penal Code (RPC) but acquitted Tamor on reasonable doubt. On appeal, Remolano
argued that the element of intimidation could not have been present since his arrest was a result of an
entrapment operation.

The Court of Appeals (CA) agreed with Remolano. Nonetheless, the CA rendered a verdict of
conviction against Remolano for Direct Bribery under Article 210 of the RPC. It ruled that the allegations in
the Information for Robbery necessarily included the charge of direct bribery, and so did the evidence adduced
during the trial.

Remolano seeks affirmative relief before the Supreme Court (SC) via a petition on certiorari. He faults
the CA for convicting him of Direct Bribery when it was not purportedly charged in the Information filed
against him, depriving him of his constitutional rights to be informed of the nature and cause of the accusation
against him and to due process.

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ISSUE
Did the modification of the verdict of conviction against Remolano from robbery to direct robbery
have the effect of depriving him of his right to be informed of the nature and cause of accusation against him,
as well as his right to due process?

RULING
YES. The real nature of the criminal charge is determined not by the caption of the Information or
the citation of the law allegedly violated, which are mere conclusions of law, but by the actual recital of facts in
that Information. Thus, to discharge its burden of informing the accused of the charge, the State must specify
in the Information the details of the crime and any aggravating or qualifying circumstances surrounding its
commission. It emanates from the presumption of innocence in favor of the accused who is always deemed to
have no independent knowledge of the details of the crime he or she is being charged with.

The Information did not sufficiently allege the second element of Direct Bribery, that is, “the offender
accepts an offer or a promise or receives a gift or present.” There was no allegation in the Information that the police
officer voluntarily offered or gave the Php 200.00 to Remolano as a consideration for the latter not to issue a
traffic violation ticket against him. Neither was it averred that there was an agreement between the parties to
exchange Remolano’s performance of his official duties for payment of money. In truth, the Information simply
alleged that Remolano “by means of intimidation extorted/demanded from the complainant the amount of
Php 200.00, in exchange for non-issuance of traffic violation receipt, thus creating fear in the mind of the
complainant who was compelled to give to the accused the amount of Php 200.00.”

The principal distinction between bribery and robbery “is that in bribery the transaction is mutual and
voluntary; in the case of robbery the transaction is neither voluntary nor mutual, but is consummated by the
use of force or intimidation.” Thus, if the offended party had voluntarily offered to pay the accused, the
transaction constitutes bribery. But if the accused demanded payment accompanied with threats, he is guilty of
robbery. Verily, direct bribery is not necessarily included, nor includes, the crime of robbery, and vice versa.
The element of violence, or force or intimidation in robbery under Article 293, in relation to Article 294 (5) of
the RPC cancels out, and in fact, clashes with the element of voluntariness or mutual agreement in direct bribery
under Article 210 of the RPC.

Here, the crime of direct bribery is not covered by Remolano’s indictment for the crime of robbery.
Remolano, therefore, cannot be convicted of direct bribery. The variance between the allegations contained in
the Information and the conviction resulting from trial will justify a conviction for either the offense charged
or the offense proved only if either is included in the other. To convict Remolano for direct bribery, as the CA
did, violates the proscription found in the Constitution and the Rules on Criminal Procedure.

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JAIME V. SERRANO v. FACT-FINDING INVESTIGATION BUREAU, OFFICE OF THE

DEPUTY OMBUDSMAN FOR THE MILITARY AND OTHER LAW ENFORCEMENT
OFFICES
G.R. No. 219876, 13 October 2021, 1ST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The following are the duties and responsibilities of agency officials:

6.0 DUTIES AND RESPONSIBILITIES OF AGENCY OFFICIALS

xxxx

6.04 Disbursing officers[,] in particular[,] shall faithfully comply with Section 100 of Presidential
Decree No. 1445 which require[s] them to render monthly reports of their transactions pursuant to
existing auditing regulations not later than the fifth day of the ensuing month to the auditor concerned.

6.05 The official involved in the daily recording of transactions in the books of accounts shall turn
over the receipts and the disbursement records with all paid vouchers and documents evidencing the
transaction to the Auditor within ten (10) days from [the] date of receipt of said documents.
xxxx

6.08 Pre-repair evaluation shall be performed by management, furnishing a copy thereof to the
Auditor within five (5) days from [the] date of evaluation/inspection.

6.09 Inspection of consumable and perishable items, as well as unserviceable and disposable
government property and others (sic) assets, shall be conducted by management. A copy of the report
of inspection or its equivalent shall be submitted to the Head of the Auditing Unit within twenty[-
]four (24) hours from acceptance of the items delivered and, in the case of unserviceable and disposable
property/assets, immediately after inspection thereof by management.

6.10 Management shall furnish the Auditor with a copy of the schedule or notice of opening of bids
and condemnation/destruction of government property and other disposable assets, as the case may
be, at least five (5) days before the scheduled time.

Verily, the role of the Resident Auditor did not become passive and reactive by the mere lifting of pre-audit activities, as
a rule, under COA Circular No. 95-006. It did not render Resident Auditors powerless when it comes to detecting and preventing
irregular or anomalous transactions entered into by various government agencies. For control measures have remained in place to
prevent the wastage, if not depletion of government coffers. Had Serrano implemented these control measures here, the PNP could
have avoided wasting its funds on ghost deliveries and illegal contracts relative to the repairs and refurbishing of the twenty-eight
(28) LAVs of the PNP.

FACTS
Jaime Serrano (Serrano) was the Commission on Audit (COA) Supervisor and Resident Supervisor of
the Philippine National Police (PNP). During his time with the PNP, the then PNP Director General Oscar
Calderon (Calderon) requested the repair and refurbishing of the twenty-eight (28) Light Armored Vehicles

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(LAV) used by the PNP. This was approved by former President Gloria Macapagal Arroyo and the Department
of Budget Management (DBM) approved the release of the funds for the repair of the LAV.

Controversy struck when it was discovered by COA and the Criminal Investigation and Detection
Group (CIDG) that the procurement process for the repair of the LAVs were highly irregular and illegal. Thus,
the Fact-Finding Investigation Bureau of the Office of the Deputy Ombudsman for the Military and Other
Law Enforcement Offices (FFIB-MOLEO) filed a complaint affidavit before the Ombudsman against the
signatories of the request. The FFIB-MOLEO likewise charged Serrano as an accessory for failing to observe
all the requirements and conditions of Pre-Audit and other existing COA Rules and Regulations.

The Ombudsman absolved Serrano of the criminal charges, but it dismissed him from service for grave
misconduct and serious dishonesty. Aggrieved, Serrano sought recourse before the Court of Appeals (CA). The
CA then affirmed the ruling of the Ombudsman.

Hence, the recourse before the Court.

ISSUE
Is Serrano administratively liable for his inaction as COA Supervisor and Resident Auditor?

RULING
YES. Although pre-audit activities had already been lifted, as a rule, under COA Circular No. 95-006,
the submission of certain documents and reports remains mandatory, viz.:

6.0 DUTIES AND RESPONSIBILITIES OF AGENCY OFFICIALS

6.04 Disbursing officers[,] in particular[,] shall faithfully comply with Section 100 of
Presidential Decree No. 1445 which require[s] them to render monthly reports of their
transactions pursuant to existing auditing regulations not later than the fifth day of the ensuing
month to the auditor concerned.

6.05 The official involved in the daily recording of transactions in the books of accounts shall
turn over the receipts and the disbursement records with all paid vouchers and documents
evidencing the transaction to the Auditor within ten (10) days from [the] date of receipt of
said documents.

6.08 Pre-repair evaluation shall be performed by management, furnishing a copy thereof to

the Auditor within five (5) days from [the] date of evaluation/inspection.

6.09 Inspection of consumable and perishable items, as well as unserviceable and disposable
government property and others (sic) assets, shall be conducted by management. A copy of
the report of inspection or its equivalent shall be submitted to the Head of the Auditing Unit
within twenty[-]four (24) hours from acceptance of the items delivered and, in the case of
unserviceable and disposable property/assets, immediately after inspection thereof by
management.

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6.10 Management shall furnish the Auditor with a copy of the schedule or notice of opening
of bids and condemnation/destruction of government property and other disposable assets,
as the case may be, at least five (5) days before the scheduled time.

Non-compliance with the reportorial requirements warrants the suspension of payment of

salaries of the erring employees:
xxxx
7.0 FAILURE TO SUBMIT REPORTS

7.01 Unjustified failure on the part of the official or employee concerned to submit the
documents and reports mentioned herein shall be considered a ground for the automatic
suspension of payment of this (sic) salary until he shall have complied with the aforesaid
requirements, without prejudice to any disciplinary action that may be instituted against him.

Verily, the role of the Resident Auditor did not become passive and reactive by the mere lifting of pre-
audit activities, as a rule, under COA Circular No. 95-006. It did not render Resident Auditors powerless when
it comes to detecting and preventing irregular or anomalous transactions entered into by various government
agencies. For control measures have remained in place to prevent the wastage, if not depletion of government
coffers. Had Serrano implemented these control measures here, the PNP could have avoided wasting its funds
on ghost deliveries and illegal contracts relative to the repairs and refurbishing of the twenty-eight (28) LAVs
of the PNP.

Second. Even assuming that it is physically impossible to conduct post-audit of all PNP transactions,
this is no reason to ignore a P409,740,000.00 transaction. To reiterate, Serrano did not perform either pre-audit
or post-audit activities. It was as though he was completely hands-off insofar as the transaction was concerned.
The sheer magnitude of the amount involved would have told him to at least give due attention to the
transaction as the probability of wastage if not corruption bears proportionality thereto.

Third. Being undermanned is nothing new to public service. It is not something we can use as a
convenient tool to wax negligence and failure. Time and again, the Court has held that having a heavy workload
is not a valid excuse. Otherwise, every government employee charged with dereliction of duty would proffer
such a convenient excuse to escape liability, to the great prejudice of the public. At any rate, he could have
simply called the attention of PNP management as regards the irregularity with the contract and non-
compliance with COA Circular 95-006. Surely, this did not require additional personnel.

Finally. The Court agree with the Court of Appeals that Serrano’s instruction to Quiambao was a mere
afterthought, an attempt to exculpate himself of administrative liability. Offering such a flimsy excuse trivialized
his role as a COA Supervisor. Given the amounts involved and his bounden duty as COA auditor to ensure
that government funds are properly expended, he should have exercised a higher degree of care and vigilance
in the discharge of his duties in relation to the repair and refurbishing contracts. Had he faithfully executed his
duties, the highly irregular transactions would have been discovered earlier. Instead, Serrano was unmindful of
his duties as COA Supervisor and Resident Auditor of PNP and allowed the P409,740,000.00 transaction to
slip through the cracks with ease.

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Verily, the documents which Serrano supposedly instructed Quiambao to review and require from the
PNP to produce were exactly the same documents required for him to be able to perform his duty as COA
Supervisor and Resident Auditor vis-a-vis COA Circular No. 95-006. As it was though, despite Serrano’s
supposed instruction to Quiambao, the documents were not submitted. But instead of compelling compliance,
Serrano’s simply and quietly did nothing more. In fact, he did not even disapprove the payment for this
otherwise undocumented transaction though it is basic that the total absence of supporting documents renders
any public contract outrightly irregular, anomalous, and unlawful. When Serrano did not disapprove the
contract in question, albeit he had the sworn duty to do so, it meant he tacitly approved it.

Justice Caguioa also points out that Serrano purportedly reported the failure of PNP to submit the
relevant documents covering the questionable transaction in the PNP Annual Audit Report for 2008. Serrano
even quoted this observation in his counter-affidavit before the Ombudsman, thus:

34. Significantly, PNP's delayed submission of the financial reports and disbursement
vouchers was among my adverse audit findings for the year 2008. The pertinent portion of
the 2008 Annual Audit Report, particularly Finding No. 25 thereof, reads:

25. Submission of financial reports was not made in accordance with section 122 of PD 1445.
This always hampers the timeliness of audit/review of the agency's financial transactions.
xxxx

But the report only speaks of supposed documents which were submitted late. Hence, it could not
have referred to the relevant documents asked of Quiambao that were never submitted at all. Whichever,
Serrano should have disapproved the payment just the same. The transaction being undocumented is the
strongest ground to disapprove its payment outright. But he never did. Had Serrano done his job by outrightly
disapproving the transaction, he never even had to complain in his annual report about documents supposedly
submitted late to his office.

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VINES REALTY CORPORATION v. RODEL RET

G.R. No. 224610, 13 October 2021, FIRST DIVISION (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

Under Section 101 of Commonwealth Act No. 141 (CA 141), the Public Land Act, it is the OSG alone which may
file a complaint for reversion of property on behalf of the Republic. This power of the President to direct the OSG to institute
reversion proceedings is part of the President’s executive control and supervision under Section 17, Article VII of the Constitution.

In this case, the Court of Appeals here directed the OSG to review and reinvestigate the issuance of the OCT for possible
reversion proceedings. But again, whether to investigate possible reversion cases or file reversion proceedings are pure matters of
executive prerogative which the Court cannot encroach.

FACTS
The subject property originally formed part of a 144.62 hectares of land situated in Camarines Norte.
The San Mauricio Mining Company (SMMC) had mineral claims on the property. By Deed of Absolute Sale,
SMMC transferred its surface rights in favor of National Shipyards and Steel Corporation (NASSCO), a
government-owned and controlled corporation.

By Proclamation No. 500, then President Ferdinand E. Marcos (President Marcos) reserved 170.2890
hectares of land, including the subject property as site for NASSCO’s pier, warehouse, and smelting plant in
Camarines Norte. Former President Marcos further issued Presidential Decree No. 837 (PD 837) transferring
ownership of the entire 170.2890 hectares to the name of NASSCO.

Original Certificate of Title was thus issued in favor of NASSCO. Weeks later, NASSCO sold the land
to Philippine Smelters Corporation (PSC), a private corporation chaired by Jose T. Marcelo, Jr. (Marcelo). By
virtue thereof, the land was titled in the name of PSC under Transfer Certificate of Title (TCT).

Claiming to have retained its mining rights over the property despite the earlier sale of its surface rights
to NASSCO, PSC's predecessor in interest, SMMC caused the annotation of an adverse claim on OCT which
got carried over to subsequent titles. Thus, PSC filed with the then Court of First Instance (CFI) a civil case
against the San Mauricio Mining Co., and Marsman & Co., Inc. for quieting of title.

After due proceedings, the CFI rendered judgment, ordering the cancellation of SMMC’s adverse
claim, declaring PSC as the true and absolute owner of the land, and awarding the possession of the land,
including the surface rights thereon to PSC. In another case entitled SMMC v. Ancheta (San Mauricio), the Court
affirmed the ruling that SMMC no longer had any vested right in the property since NASSCO already sold the
land to PSC. The aforesaid decision had long become final and executory.

In 1986, PSC closed its operations. Consequently, PSC creditors Development Bank of the Philippines
(DBP), PISO Bank, and Conrad C. Leviste (Leviste) of Vines Realty Corporation (Vines Realty) went after the
assets of PSC to satisfy their respective claims. For its part, Vines Realty, through Leviste, initiated a civil case
against PSC and obtained a favorable money judgment which got executed over a portion of the property. Later
on, Vines Realty purchased the additional portions of the property at a public auction sale. Vines Realty, thus,
eventually became the owner of a portion of the subject property. Thereafter, Vines Realty applied for and was

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granted writs of possession and demolition against the informal settlers occupying these portions. The Court
of Appeals (CA) subsequently affirmed with finality.

But the informal settlers remained adamant. This time, claiming to be tenants of the property, they
sought relief from the Department of Agrarian Reform Adjudication Board (DARAB through filing a DARAB
Case which was eventually dismissed.

Meantime, the enforcement of the writs of possession and demolition was suspended upon the request
of the Municipal Mayor and Sangguniang Bayan of Jose Panganiban. Subsequently, alias writs of possession
and demolition were issued only to be halted again, still at the instance of the informal settlers and the local
government officials. Hence, Vines Realty charged the informal settlers with indirect contempt. Both the trial
court and the CA gave affirmative relief to Vines Realty and cited the informal settlers for indirect contempt.

Through a letter, the informal settlers, otherwise known as the residents of Barangay Bagongbayan,
Jose Panganiban, Camarines Norte, through their leader, herein Rodel Ret (Ret), along with other respondents,
wrote then Governor Emmanuel B. Pimentel to cause an investigation on the issuance of OCT which they
claimed was tainted with fraud. They, too, asserted that they have been in physical possession of different
portions of the land even before World War II. Together with the local government, they had introduced
improvements thereon which are now covered by the OCT and its derivative titles all in the name of Vines
Realty.

After several endorsements, the letter ended up with then Secretary Antonio Cerilles of the Department
of Environment and Natural Resources (DENR) who, by Memorandum, ordered the City Environment &
Natural Resources Office (CENRO) to conduct the desired investigation and submit its report and
recommendation.

Under Land Management Officer (LMO) III Fortunata Z. Hemady (Hemady)’s Report and
Recommendation addressed to CENRO, she recommended the filing of reversion proceedings on the entire
land. The CENRO and Provincial Environment & Natural Resources Office (PENRO) favorably endorsed
the report to DENR. By another Memorandum, however, Regional Executive Director Oscar Hamada
(Director Hamada), citing San Mauricio, reversed the recommendation on the ground of res judicata.

Ret, et al., filed with the Office of the President (OP) a Letter-Complaint to compel the DENR to
render an early resolution of their land problem. Meantime, the DENR issued a status quo ante order and
directed Vines Realty to allow Bagongbayan residents to use the ingress and egress at the pier as previously
practiced. Eventually, then DENR Secretary Jose L. Atienza, Jr. dismissed the complaint for lack of merit and
lifting the status quo ante.

The appellate court reversed and set aside the resolution of the Office of the President. It held that the
OP failed to consider Hemady's Investigation Report which noted certain irregularities in PSC's acquisition of
title and recommended the filing of reversion proceedings on the land.

ISSUES
(1) May the OSG initiate reversion proceedings, sans the recommendation of the LMB or DENR?

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(2) Do courts have the authority to encroach on the executive prerogative to determine whether to file a
reversion case?

RULING
(1) NO. Reversion proceeding is the manner through which the State seeks to revert land to the mass
of the public domain; it is proper when public land is fraudulently awarded and disposed of in favor of private
individuals or corporations, or when a person obtains a title under the Public Land Act which includes, by
oversight, lands which cannot be registered under the Torrens system as they form part of the public domain.

Under Section 101 of Commonwealth Act No. 141 (CA 141), the Public Land Act, it is the OSG alone
which may file or institute a complaint for reversion of property on behalf of the Republic. This power of the
President to direct the OSG to institute reversion proceedings is part of the President’s executive control and
supervision under Section 17, Article VII of the Constitution.

Indeed, the nature of reversion proceedings puts the onus probandi on the State. In order to ensure that
the State would be able to discharge this burden, the LMB or DENR first determines whether there is ground
to file a case for reversion and whether the State has sufficient evidence to prove its claim. Without a
recommendation and evidentiary documentation from LMB and DENR, the OSG could not possibly prosecute
its case for reversion; it would not be able to discharge its burden of proof.

Here, Ret wanted the DENR to investigate the circumstances surrounding the issuance of the subject
OCT on allegations of fraud. But the DENR dismissed their letter complaint upon its finding that no legal
basis existed for the OSG to initiate reversion proceedings and seek the cancellation of the OCT and its
derivative titles, ruling that San Mauricio operates as res judicata to any reversion proceeding the OSG may file.
This ruling was affirmed by the OP. In other words, the requisite recommendation to file the reversion case
was not forthcoming. Without it, the OSG cannot be compelled to file a complaint for reversion, lest it violates
Section 101 of CA 141.

(2) NO. The President’s constitutional power of control over all the executive departments, bureaus,
and offices cannot be curtailed or diminished by law. Since the Constitution has given the president the power
of control, with all its awesome implications, it is the Constitution alone which can curtail such power. This
constitutional power of control of the President cannot be diminished by the CTA. Thus, if two executive
offices or agencies cannot agree, it is only proper and logical that the President, as the sole Executive who under
the Constitution has control over both offices or agencies in dispute, should resolve the dispute instead of the
courts.

The judiciary should not intrude in this executive function of determining which is correct between
the opposing government offices or agencies, which are both under the sole control of the President. Under
his constitutional power of control, the President decides the dispute between the two executive offices. The
judiciary cannot substitute its decision over that of the President. Only after the President has decided or settled
the dispute can the courts’ jurisdiction be invoked. Until such time, the judiciary should not interfere since the
issue is not yet ripe for judicial adjudication. Otherwise, the judiciary would infringe on the President’s exercise
of his constitutional power of control over all the executive departments, bureaus, and offices.

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Only when there is an actual case or controversy may the jurisdiction of the courts be invoked. This
requirement goes into the nature of the judiciary as a co-equal branch of government. It is bound by the doctrine
of separation of powers and will not rule on any matter or cause the invalidation of any act, law, or regulation
if there is no actual or sufficiently imminent breach of or injury to a right. The courts interpret laws, but the
ambiguities may only be clarified in an actual case or controversy.

Otherwise stated, there appears to be no actual case or controversy here as the courts do not have the
authority to grant the relief sought by Ret, lest the courts violate the doctrine of separation of powers and the
President's constitutional power of control over all executive departments, bureaus and offices.

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HUMPHREY T. MONTEROSO v. SPECIAL PANEL NO. 13-01-IAB, REPRESENTED BY

DONABEL ATIENZA
G.R. Nos. 235274-75, 13 October 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

To constitute an administrative offense, misconduct should relate to or be connected with the performance of the official
functions and duties of a public officer. On the other hand, when the element of corruption or clear intent to violate the law or
flagrantly disregard an established rule is manifest, the public officer shall be liable for grave misconduct.

Here, the actions of Monteroso are undoubtedly imbued with corruption. He unlawfully and wrongfully used his position
to procure pecuniary and non-pecuniary benefits for himself, contrary to his duty and with flagrant disregard for the rights of others.

FACTS
In June 2009, Spouses Jesus and Meljurena Osabel (Spouses Osabel) filed a criminal complaint with
the Office of the Ombudsman-Mindanao (OMB-MIN) against General Santos Mayor Pedro Acharon, Jr. and
other city officials for alleged tampering with land titles in General Santos City. The case was assigned to
Humprey Monteroso (Monteroso), then Deputy Ombudsman of OMB-MIN. Despite multiple motions for an
early resolution and follow-ups, the complaint stagnated at the preliminary investigation level for two years
without progress.

In December 2011, Assistant Ombudsman Asryman T. Rafanan (AO Rafanan) forwarded the
complaint to Monteroso for action and requested a status update within seven days. Monteroso failed to
respond. This prompted Spouses Osabel to escalate the issue to President Benigno Aquino, who referred it to
the OMB's Public Assistance Bureau (PAB). A PAB memorandum reiterated the need for prompt action, but
Monteroso still did not respond. Four years after the complaint was filed, OMB-MIN eventually dismissed it
for lack of probable cause.

Due to Monteroso's continued inaction and failure to address Spouses Osabel’s letters and directives,
the Internal Affairs Board (IAB) initiated an investigation led by IAB Investigating Staff Atty. Reyvic Iringan.
The investigation recommended administrative adjudication against Monteroso for Gross Neglect of Duty,
Gross Insubordination, and Conduct Prejudicial to the Best Interest of the Service. The IAB approved this
recommendation and created a special panel to investigate further.

In his Counter-Affidavit, Monteroso denied the allegations, claiming that he did not intentionally refuse
to act on the complaint and attributing the lack of response to being understaffed. He explained that all
communications were handled by his assigned lawyer, Atty. Noel Gelito and his office eventually dismissed the
complaint due to a lack of probable cause.

The IAB's Report and Recommendation found Monteroso guilty of Simple Neglect of Duty and
Conduct Prejudicial to the Best Interest of the Service but exonerated him of Gross Insubordination. The IAB
noted that as the head of OMB-MIN, Monteroso was responsible for ensuring timely resolution of cases. The
prolonged delay and failure to act on the complaint were deemed infringements on the right to a speedy trial,
and his heavy workload was not considered a valid excuse. The IAB imposed a nine-month suspension,
considering Monteroso's length of service as a mitigating factor, but since his term had expired, the penalty was
converted to a fine equivalent to six months' salary, deducted from his retirement benefits.

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Additionally, Monteroso faced separate charges of Grave Misconduct and Grave Abuse of Authority.
Emmanuel Arquellano (Arquellano), Monteroso’s former personal aide, reported that Monteroso exploited him
for personal chores and financial transactions. Arquellano was instructed by Monteroso to open bank accounts
and manage substantial funds, which he later returned before resigning. Arquellano reported these activities to
the IAB, providing supporting documents. The IAB found Monteroso guilty of Grave Misconduct for
exploiting Arquellano for personal tasks without compensation, as his salary was drawn from OMB-MIN.

The IAB also found Monteroso guilty of Grave Abuse of Authority for obstructing access to HR files
and berating a subordinate, Chief Administrative Officer Amelia Peligro (CAO Peligro), for complying with an
IAB subpoena. This conduct was seen as oppressive and abusive.

The IAB recommended dismissal from service for Grave Misconduct and Grave Abuse of Authority
but imposed a fine equivalent to six months' salary due to the expiration of Monteroso's term. Ombudsman
Conchita Carpio Morales approved this recommendation. Monteroso's motions for reconsideration were
denied, and the cases were consolidated for appeal before the Court of Appeals.

ISSUE
Is Monteroso liable for simple neglect of duty, conduct prejudicial to the best interest of the service,
grave misconduct, and grave abuse of authority?

RULING
YES. The Court ruled that Monteroso was correctly charged with simple neglect of duty, conduct
prejudicial to the best interest of the service, grave misconduct, and grave abuse of authority.

Under Section 5(a) of Republic Act No. 6713 (R.A. No. 6713), otherwise known as the Code of
Conduct and Ethical Standards for Public Officials and Employees, every public officer or employee must
respond to letters and requests addressed to him or her within 15 working days from notice.

In the case of Monteroso, he does not deny that he failed to formally reply to the endorsement of
Rafanan and to the PAB Memorandum. Neither does he deny that he failed to inform Spouses Osabel of the
action so far taken on their criminal complaint despite the directive from AO Rafanan and the PAB to do so
or at least acknowledge his receipt of the directive either by himself or through the assigned handling lawyer.
In other words, he failed to give proper attention to a task expected of him, signifying a disregard of his duty
resulting from either carelessness or indifference. This constitutes simple neglect of duty.

Under the Civil Service law and rules, there is no concrete description of what specific acts constitute
the grave offense of conduct prejudicial to the best interest of the service. Jurisprudence, however, instructs
that for an act to constitute such an administrative offense, the act need not be related to or connected with
the public officer's official functions. If the questioned conduct tarnishes the image and integrity of his or her
public office, the corresponding penalty may be meted out to the erring public officer or employee.

The Court also found Monteroso guilty of conduct prejudicial to the best interest of the service.
Monteroso’s prolonged delay in resolving Spouses Osabel’s complaint (filed in June 2009 and dismissed in May
2013) caused significant harm, requiring intervention from higher authorities and tarnishing the reputation of

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the office. This delay and Monteroso’s indifference compromised the integrity of his office, similar to Miranda
v. CSC, where delays in submission led to prejudice against the public interest.

Misconduct is a transgression of some established and definite rule of action, more particularly,
unlawful behavior or gross neglect of duty by a public officer. The misconduct is considered to be grave if it
also involves other elements such as corruption or the willful intent to violate the law or to disregard established
rules.
To constitute an administrative offense, misconduct should relate to or be connected with the
performance of the official functions and duties of a public officer. On the other hand, when the element of
corruption or clear intent to violate the law or flagrantly disregard an established rule is manifest, the public
officer shall be liable for grave misconduct. Corruption in grave misconduct involves officials using their
position improperly to gain personal benefits or advantages for others, against their duties and others' rights.

Here, Monteroso was correctly found guilty of grave misconduct. He exploited his position by allowing
his family house boy, Arquellano, to simultaneously serve as a government employee while performing
domestic chores. Additionally, Monteroso used Arquellano to facilitate large, unexplained bank deposits,
demonstrating corruption and wrongful use of office for personal gain. This misconduct involved serious
elements of corruption and disregard for law, warranting a grave offense classification.

Oppression, or grave abuse of authority, is when a public officer abuses their power to inflict harm or
injury on others, such as through cruelty or excessive authority. The Court has previously addressed such
behavior, as seen in the case of Office of the Court Administrator v. Yu, who was found guilty of grave abuse
of authority for blocking access to records in an administrative case against her. The Court emphasized that
abuse of authority extends beyond physical violence and can include any actions that torment, irritate, or hinder
others. The government must not tolerate such misconduct, as it undermines trust and fairness in public service.

In this case, Monteroso, in using his position, obstructed the investigation by berating CAO Peligro
and controlling access to HR files, which hindered the investigation into his actions. His behavior was abusive
and oppressive, using his position to suppress evidence and obstruct the truth.

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CAGAYAN DE ORO CITY WATER DISTRICT, REPRESENTED BY ITS GENERAL

MANAGER ENGR. RACHEL M. BEJA v. HON. EMMANUEL P. PASAL, REGIONAL TRIAL
COURT, BRANCH 38, CAGAYAN DE ORO CITY AND RIO VERDE WATER CONSORTIUM,
INC.
G.R. No. 202305, 11 November 2021, 1ST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Under the principle of competence-competence, the arbitral tribunal has the first opportunity to rule on whether it has
jurisdiction to decide a dispute submitted for its resolution. In other words, whether the trial court acted in grave abuse of discretion
or otherwise grievously erred in directing COWD and Rio Verde to submit to arbitration is for the arbitral tribunal itself to
determine, not the Court.

Hence, COWD's beeline to the Court via Rule 65 of the Rules of Court is explicitly prohibited under the Special ADR
Rules. The fact alone that COWD is a government entity does not excuse it from abiding by these Rules.

FACTS
The case involves a dispute between Cagayan De Oro City Water District (COWD) and Rio Verde
Water Consortium, Inc. (Rio Verde).

The Cagayan De Oro City Water District (COWD) conducted public bidding of the contract for the
design, construction, operation, maintenance, and management of its Bulk Water Supply Project (BWSP) for
Cagayan de Oro City and its environs, with a Model Contract as part of the bidding documents.

The COWD awarded the BWSP contract to Rio Verde. Consequently they signed the Bulk Water
Supply Agreement (BWSA). Rio Verde was awarded the contract to supply bulk water to COWD at a starting
rate of P10.45 per cubic meter for 25 years. Billing issues arose when Rio Verde charged P11.52 per cubic
meter, prompting COWD to review the contracts.

The Commission on Audit (COA) issued a Notice of Disallowance against the payment of
P132,414,165.40 to Rio Verde, citing irregularities in the bidding process and contract execution.

Despite ongoing COA investigations, Rio Verde sought arbitration as per the BWSA's dispute
resolution clause, which COWD opposed.

The Regional Trial Court (RTC) then ordered COWD to submit to arbitration.

ISSUES
(1) May the trial court's directive to arbitrate be properly challenged via the present petition for certiorari?
(2) Did the trial court gravely abuse its discretion when it directed the COWD and Rio Verde to arbitrate
despite the then ongoing investigation being conducted by COA on the award and execution of the
questioned contract to Rio Verde?
(3) Does the recommendation of COA to charge the members of the board of directors of COWD and
Rio Verde with violation of Section 3(e) of RA 3019, and to file a civil case for nullity of the BWSA,
legally preclude the parties from proceeding to arbitrate?

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RULING
(1) YES. The prohibition against filing for motions for reconsideration, appeals, or petitions for
certiorari against the order to arbitrate is not without basis. In fact, it promotes the principle of competence-
competence and policy of judicial restraint highlighted in Republic Act No. 9285 (RA 9285) or the Alternative
Dispute Resolution Act of 2004 and Rule 2 of the Special ADR Rules.

Under the principle of competence-competence, the arbitral tribunal has the first opportunity to rule
on whether it has jurisdiction to decide a dispute submitted for its resolution. In other words, whether the trial
court acted in grave abuse of discretion or otherwise grievously erred in directing COWD and Rio Verde to
submit to arbitration is for the arbitral tribunal itself to determine, not the Court.

Indeed, arbitration agreements are liberally construed in favor of proceeding to arbitration. This
emanates from the Court's policy favoring party autonomy in the resolution of disputes as reflected in our Civil
Code, RA 876, RA 9285, and Executive Order 1008, otherwise known as The Construction Industry Arbitration
Law, which invariably recognize the validity and enforceability of the parties' decision to arbitrate.

Thus, in LM Power Engineering Corporation v. CICGI, the Court affirmed the referral of an ongoing case
to arbitration, since the arbitral clause in the Agreement is a commitment on the part of the parties to submit
to arbitration the disputes covered therein. Because that clause is binding, they are expected to abide by it in
good faith. And because it covers the dispute between the parties in the present case, either of them may compel
the other to arbitrate.

To repeat, only after the arbitral tribunal shall have already ruled on the issue of jurisdiction may the
aggrieved party seek judicial recourse against submitting itself to the process of arbitration. Leapfrogging the
judicial process in clear defiance of the Special Rules on ADR violates the principle of competence-competence
and the State policy to actively promote the use of alternative modes of dispute resolution.

Hence, COWD's beeline to the Court via Rule 65 of the Rules of Court is explicitly prohibited under
the Special ADR Rules. The fact alone that COWD is a government entity does not excuse it from abiding by
these Rules.

(2) NO. As aptly noted by the trial court, the doctrine of separability holds that the arbitration
agreement is independent of the main contract. In other words, the supposed invalidity of the main contract
does not ipso facto render the arbitration clause/agreement itself invalid or unenforceable.

In fine, the trial court did not commit grave abuse of discretion when it compelled the parties to
arbitrate in accordance with the arbitration clause of their BWSA, as amended. This does not mean though that
COWD is already precluded from questioning or invoking the alleged invalidity of the aforesaid BWSA, as
amended. It may actually do so before the arbitral tribunal itself which in accordance with the principle of
competence--competence has primary jurisdiction to resolve any objection pertaining to the existence or
validity of the arbitration agreement.

(3) NO. To repeat, the arbitral tribunal has the first opportunity to rule on whether it has jurisdiction
to decide a dispute submitted for its resolution, including the validity of the contract itself. This is clear from
Article 19 of the BWSA which clearly states that among the arbitrable issues is the nullity of the BWSA itself.

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FIELD INVESTIGATION OFFICE, OFFICE OF THE OMBUDSMAN v. ENRICO T. YUZON,

GODOFREDO DE GUZMAN, LUDIVINA BANZON, AND EMERLINDA TALENTO
G.R. No. 215985, 11 November 2021, FIRST DIVISION, (Lazaro-Javier, J.)

FIELD INVESTIGATION OFFICE, OFFICE OF THE OMBUDSMAN v. FRANCISCO T.

CAPARAS
G.R. No. 216001, 11 November 2021, FIRST DIVISION, (Lazaro-Javier, J.)

FIELD INVESTIGATION OFFICE, OFFICE OF THE OMBUDSMAN v. RODOLFO H. DE

MESA
G.R. No. 216135, 11 November 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Misconduct is a transgression of some established and definite rule of action, more· particularly, unlawful behavior or
gross negligence by the public officer. To warrant dismissal from the service, the misconduct must be grave, serious, important,
weighty, momentous, and not trifling. The misconduct must imply a wrongful intention and not a mere error of judgment. It must
also have a direct relation to the performance of the public officer's official duties amounting either to maladministration or willful,
intentional neglect, or failure to discharge the duties of the office. In order to differentiate gross misconduct from simple misconduct,
the elements of corruption, clear intent to violate the law, or flagrant disregard of established rule, must be manifest in the former.

Meanwhile, dishonesty has been defined as the concealment or distortion of truth, which shows lack of integrity or a
disposition to defraud, cheat, deceive, or betray, or intent to violate the truth.

The OMB correctly found that the procurement of the patrol boat was replete with flagrant and multiple violations of
the procurement law and its implementing rules and regulations. The BAC members, in violation of the procurement law and its
implementing rules and regulations, awarded the patrol boat contract to a supplier who was not technically, legally, and financially
qualified, to the prejudice of the government.

FACTS
The Field Investigation Office (FIO) of the Office of the Ombudsman (OMB) filed against numerous
local officials of the Provincial Government of Bataan charges for violation of Section 3(e) and (g) of Republic
Act No. 3019 (R.A. No. 3019), and dishonesty, grave misconduct, and conduct prejudicial to the best interest
of the service. These cases involved the alleged anomalous purchase of a patrol boat. The Bids and Awards
Committee (BAC) of Bataan held an initial bidding for the supply and delivery of the patrol boat. There was
failure of bidding since the lone bidder failed to pass the post-qualification stage due to lack of experience to
undertake the project. The re-bidding also failed because there was no participating bidder. The BAC then
recommended the use of Limited Source Bidding (LSB) or Selective Bidding. These recommendations were
duly approved by the Bataan Governor. The LSB never happened. Instead, the BAC resorted to negotiated
procurement inviting the following to bid for the project: Ernesto Asistin, Jr. (Asistin, Jr.), Agrifino Otor (Otor),
and Marcelo Rodriguez (Rodriguez). A Notice of Award (NOA) was eventually issued to Asistin as the winning
bidder. The NOA, Contract Agreement, and Notice to Proceed signed by the provincial administrator
contained alterations modifying the specifications of the patrol boat. The patrol boat was eventually delivered,
received, and paid for by provincial officials.

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During the FIO investigation, Asistin, Jr. claimed that he had received the full amount of the bid which
he used to build the patrol boat weeks after the supposed delivery to the local government. Otor averred that
he is a fisherman who occasionally does boat repairs. He also averred that he did not sign any document for
the Province of Bataan as he can hardly read, having finished only Grade 1. He does not have a boat business.
Rodriguez stated that as a carpenter, he sometimes does boat repairs, but claimed that he does not have any
boat business. He denied owning the signature affixed to a document coming from the Province of Bataan
although his name appeared thereon.

The OMB found numerous provincial officials liable for grave misconduct and dishonesty and meted
them the penalty of dismissal from the service. The OMB ruled that the BAC members flagrantly disregarded
procurement rules in the procurement of the patrol boat when it approved the modification in the specification
after the project was already awarded to Asistin, Jr. Such modification requires a new bidding with the
corresponding reduction in the purchase price. The BAC also negotiated with Asistin, Jr., Otor, and Rodriguez,
who were not bonafide suppliers, not having the technical, legal, and financial capacity to enter into a contract
with the government.

These BAC members also committed dishonesty when they claimed to have received and inspected
the patrol boat in January 2006 when no such delivery took place. Asistin, Jr. claimed to have encashed the
check in February 2006 and spent the next three to four weeks to finish the boat. Governor Garcia was not
exempt from liability as he exercised general supervision and control over all programs, projects, services, and
activities of the provincial government. He failed to ensure the proper conduct of the procurement. His loss in
his reelection bid in the May 2010 elections, however, meant that the administrative case against him was
declared moot.

The Court of Appeals (CA) decreed the dismissal of the administrative complaints. It considered as a
mere technical error the reference to “Limited Source Bidding” instead of “Negotiated Procurement,” the latter
being allegedly allowed under the law. The CA also found that the patrol boat was actually delivered based on
evidence. It ruled that the BAC members did not misuse their official functions for personal gain or benefit. It
also declared that the documents covering the procurement and inspection of the patrol boat were properly
executed.

ISSUE
Are the BAC members guilty of grave misconduct and serious dishonesty?

RULING
YES. Misconduct is a transgression of some established and definite rule of action, more· particularly,
unlawful behavior or gross negligence by the public officer. To warrant dismissal from the service, the
misconduct must be grave, serious, important, weighty, momentous, and not trifling. The misconduct must
imply a wrongful intention and not a mere error of judgment. It must also have a direct relation to the
performance of the public officer's official duties amounting either to maladministration or willful, intentional
neglect, or failure to discharge the duties of the office. In order to differentiate gross misconduct from simple
misconduct, the elements of corruption, clear intent to violate the law, or flagrant disregard of established rule,
must be manifest in the former.

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Meanwhile, dishonesty has been defined as the concealment or distortion of truth, which shows lack
of integrity or a disposition to defraud, cheat, deceive, or betray, or intent to violate the truth. Dishonesty is
considered serious if any of the following circumstances is present:

1. The dishonest act caused serious damage and grave prejudice to the government;
2. The respondent gravely abused his authority in order to commit the dishonest act;
xxx
5. The respondent employed fraud and/or falsification of official documents in the commission of
the dishonest act related to his/her employment;
xxxx

The OMB correctly found that the procurement of the patrol boat was replete with flagrant and
multiple violations of the procurement law and its implementing rules and regulations. The BAC members, in
violation of the procurement law and its implementing rules and regulations, awarded the patrol boat contract
to a supplier who was not technically, legally, and financially qualified, to the prejudice of the government.

The BAC resorted to Negotiated Procurement without the required authorization from the Head of
the Procuring Entity (HOPE).

Section 10 of R.A. No. 9184 requires that as a rule, every procurement shall be done through
competitive bidding. By way of exception, Sec. 48 of the same law allows the procuring entities to resort to
alternative methods to promote economy and efficiency subject to certain conditions:

SEC. 10. Competitive Bidding. - All Procurement shall be done through Competitive Bidding,
except as provided for in Article XVI of this Act.
xxxx
SEC. 48. Alternative Methods. - Subject to the prior approval of the Head of the Procuring Entity
or his duly authorized representative, and whenever justified by the conditions provided in this Act,
the Procuring Entity may, in order to promote economy and efficiency, resort to any of the following
alternative methods of Procurement:

Instead of following the process for LSB, the BAC, without any authority from the HOPE, suddenly
made a detour and peremptorily, on its own, resorted to Negotiated Procurement-Two Failed Biddings under
Section 53(a). This the BAC did by directly inviting three (3) bidders to submit bids for the patrol boat project.
They diverted to this method of procurement on the mere pretext that the requisite condition for the use of
this alternative method anyway was present, i.e., failure of bidding for the second time. Notably, too, the BAC
altogether skipped the requisite approval from the HOPE itself.

Requiring the prior approval of the HOPE for the change in the procurement method is not technical.
It is a substantial and procedural requisite which cannot be lightly dismissed. The use of the word SUBJECT
connotes a command. It is mandatory, not directory. The word "subject" imposes a condition on the use of
alternative method of procurement, that is, without the HOPE's approval as a condition, resort to alternative
method will not be permitted.

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Even assuming that the BAC was authorized to resort to Negotiated Procurement, they still violated
the governing law under R.A. No. 9184 and its IRR-A.

During the preliminary examination of bids, the BAC first determines whether the submitted bids
strictly comply with the technical specifications, and the terms and conditions of the project. If compliant, the
BAC shall proceed to open the financial proposal of bidders rated " passed." But when there is non-compliance
with any of the technical specifications, terms and conditions, the bid will be rated as " failed" and would no
longer be considered for evaluation and its financial proposal shall not be opened.

Here, the BAC failed to strictly observe the procedure for preliminary evaluation of bids. The invitation
to submit an offer or bid specifically required a 6-cylinder type patrol boat. Admittedly, Asistin, Jr. offered a 4-
cylinder engine patrol boat. His offer should have been declared as " failed," notwithstanding that his offer was
the lowest. His offer should not have been considered at all for being non-responsive. Despite this patent
defect, the BAC accepted his offer and recommended the award of the contract to him, making it appear that
they were awarding for the delivery of a 6-cylinder boat when in fact the offer was for a 4-cylinder engine patrol
boat.

The BAC disregarded another requirement in Section 53 of IRR-A governing negotiated procurement:
to negotiate only with a technically, legally, and financially capable supplier.

The three (3) supposed bidders denied ever participating in the bidding. Thus, in their respective
affidavits, Otor and Rodriguez denied submitting any documents to join the bidding for the patrol boat.
Although their main source of livelihood is fishing and there are times they build or repair boats, they are not
in the business of boat making. Even then, however, the BAC still invited all three of them, ignoring the fact
that they had no capacity at all to bid for the project. The BAC even went to the extent of introducing fake
documents into the records to make it appear that Otor and Rodriguez who denied submitting any documents
submitted the documentary requirements for Negotiated Procurement and participated therein.

The BAC violated the principles of competition and transparency when they allowed a material
alteration of the project from a 6-cylinder patrol boat to a 4-cylinder patrol boat only after the whole bidding
process had already been accomplished and the project already awarded to Asistin, Jr. This alteration has a
significant effect on the price of the patrol boat. In fact, the issued justification stated that the Approved Budget
for the Contract (ABC) was no longer sufficient for a 6-cylinder engine patrol boat, hence, the need to modify.
Had the bidders been informed of such change, they would have perhaps made an offer corresponding to a 4-
cylinder engine boat which costs less than a 6-cylinder engine boat. But as stated, no notice was ever given them
nor the so-called invited bidders.

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POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT (PSALM) Corp. v.

COMMISSION ON AUDIT
G.R. No. 247924, 16 November 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 49 of Presidential Decree No. 1445 provides that COA is mandated not only by law but by its own procedural
rules to evaluate a request for concurrence of a retainer contract of private lawyers, specifically within sixty (60) days from submission
of the request for concurrence.

The Court found COA's delay unreasonable and a violation of PSALM's right to a speedy disposition of its case under
Section 16, Article III of the Constitution. The Court noted that COA failed to provide any valid reason for its delayed action
and that its eventual denial was based solely on the technicality that PSALM did not have prior concurrence, despite the delay
being attributable to COA itself.

FACTS
In 2011, the Power Sector Assets and Liabilities Management (PSALM) Corporation sought approval
from the Commission on Audit (COA) and the Office of the Government Corporate Counsel (OGCC) to
engage Mr. John T. K. Yeap and Atty. Michael B. Tantoco as legal advisors for six months. Mr. Yeap was to
provide international legal advice at a fee of USD 580 per hour, capped at USD 609,000, while Atty. Tantoco
was to offer advice on Philippine law at a fee of PHP 11,858.94 per hour, capped at PHP 6,403,773.60. Despite
OGCC's approval on May 31, 2011, COA did not respond by the requested deadline of May 30, 2011, nor in
the 110 days that followed. Due to the lack of response, PSALM proceeded with the engagements in August
2011, without COA's concurrence.

Three years later, COA denied PSALM's request for approval, citing the lack of prior concurrence as
a violation of circulars. PSALM argued that the urgency of their privatization projects justified bypassing the
COA’s approval, but COA maintained that their prior concurrence was mandatory for all legal engagements,
including advisory services. PSALM’s subsequent petition argued that the services did not require COA’s
approval, as they were advisory and did not involve court representation. However, COA upheld its decision,
insisting on the necessity of its approval to ensure compliance and transparency, and holding PSALM officers
personally liable for the fees paid.

ISSUES
(1) Is the required prior concurrence of COA a specie of pre-audit? If so, is imposing it as a prerequisite
to the validity of the engagement of a private lawyer ultra vires?
(2) Does COA have the exclusive jurisdiction to decide when to require or not to require a prior written
concurrence, though it is an instance of pre-audit?
(3) Are the contracts of engagement here subject to the concurrence requirement under COA Circulars
Nos. 86-255 and 95-011?
(4) Did COA commit grave abuse of discretion when it acted on PSALM's request for the engagement of
the legal advisors only after three (3) years following its receipt thereof?
(5) Are the approving PSALM officers liable for the payment of the advisors' fees?

RULING

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(1) YES. The discretion to require the COA’s written concurrence in the hiring of legal services functions
is similar to a pre-audit. As defined in Dela Llana v. COA, a pre-audit involves examining financial transactions
before payment to ensure compliance with laws, availability of funds, reasonableness of expenditures, and
proper authorization.

While COA argues that its written concurrence is distinct from a pre-audit because it is not tied to a
specific payment or disbursement, however, this distinction is minimal. Both processes aim to prevent the
misuse of public funds by identifying suspicious transactions before they occur. COA acknowledges that the
purpose of the written concurrence is to ensure the reasonableness of legal fees and consistency in legal
practices across government agencies, aligning with the goals of a pre-audit.

(2) YES. The history of COA's stance on pre-audit reveals a pattern of lifting and reinstituting pre-audit
measures based on the needs and circumstances of the time. Starting in 1982, COA began lifting pre-audit
requirements to streamline government transactions, only to reinstitute them selectively in response to
irregularities. Over the years, COA has oscillated between lifting and reinstating pre-audit functions, ultimately
lifting pre-audit for all financial transactions in 1995 but retaining the right to reinstitute it selectively when
necessary.

Without a new COA circular revoking the withdrawal of pre-audit, all forms of pre-audit, including
prior written concurrence, should be considered disallowed. However, the majority opinion holds that COA
retains the exclusive authority to interpret and enforce its auditing mandates, including the discretion to require
pre-audit as it deems necessary.

The COA has consistently maintained a "saving clause" in its circulars, allowing it to reinstitute pre-
audit selectively when internal control systems are inadequate. This means that COA does not need to issue a
new circular each time it decides to reinstate pre-audit for specific transactions or agencies.

Recent COA Circular No. 2021-003 exempts certain government agencies and GOCCs from requiring
prior written concurrence for hiring lawyers and legal consultants under specific conditions, emphasizing the
goal of preventing unnecessary delays and ensuring the reasonableness of legal fees. However, this exemption
does not apply to contracts involving amounts exceeding specified limits or contracts no longer pending COA
review. Hence, COA retains the authority to require pre-audit selectively and does not need to amend previous
circulars to do so. The rationale for requiring prior written concurrence remains valid, particularly in
safeguarding public funds from potential misuse.

(3) NO. The Court, in Alejandrino v. COA, held that government-owned and controlled corporations
(GOCCs) may hire external lawyers only if they meet three conditions: (1) the hiring must be in exceptional
cases, (2) the GOCC must obtain written consent from the Solicitor General or the Government Corporate
Counsel, and (3) COA's written concurrence must be secured.

In Polloso v. Gangan, the Court further clarified that the COA concurrence requirement applies to all
types of legal services, not just those involving court litigation. The COA Circular No. 86-255 restricts GOCCs
from hiring private lawyers for any legal service without prior approval, regardless of whether the service
involves litigation.

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Similarly, Oñate emphasized that COA Circular No. 95-011 prohibits the use of public funds to pay
private lawyers for any legal service unless exceptional circumstances justify such hiring and the necessary
approvals are obtained. The purpose of these rules is to prevent unauthorized disbursement of public funds
for legal services, in line with COA's mandate to regulate government expenditures.

Thus, PSALM's hiring of legal advisors without COA's concurrence is not compliant with the
established legal requirements.

(4) YES. Section 49 of Presidential Decree No. 1445 provides that COA is mandated not only by law but
by its own procedural rules to evaluate a request for concurrence of a retainer contract of private lawyers,
specifically within sixty (60) days from submission of the request for concurrence.

The Court found COA's delay unreasonable and a violation of PSALM's right to a speedy disposition
of its case under Section 16, Article III of the Constitution. The Court noted that COA failed to provide any
valid reason for its delayed action and that its eventual denial was based solely on the technicality that PSALM
did not have prior concurrence, despite the delay being attributable to COA itself.

The Court emphasized that COA's inaction forced PSALM into a position where it had no choice but
to proceed with the engagement of the legal advisors to avoid further delay in the privatization process
mandated by EPIRA. The court ruled that COA's denial was unjustified and excused PSALM's actions, as they
were in pursuit of a greater government objective under the circumstances caused by COA's inaction. The court
recognized the need for expertise in the privatization process and held that PSALM should not be faulted for
proceeding without COA's concurrence due to the latter's inordinate delay.

(5) NO. Legal advisors provide services under their contracts with the government and are rightfully
entitled to the fees agreed upon. Contracts are binding and enforceable, obligating parties to fulfill their terms
in good faith.

The PSALM officers who approved and implemented the contracts are not personally liable for the
payment of these fees. Their actions were aligned with their duty to advance the government's interest and
improve power supply quality through privatization. Personal liability for public officials arises only from acts
done with malice, bad faith, or beyond their authority.

In this case, the PSALM officers acted with integrity, aiming to fulfill the EPIRA mandate and serve the
public interest. No evidence of bad faith or fraudulent intent exists regarding their processing of contracts and
payments.

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VENUS COMMERCIAL CO., INC. v. THE DEPARTMENT OF HEALTH and THE FOOD
AND DRUG ADMINISTRATION
G.R. No. 240764, 18 November 2021, FIRST DIVISION (LAZARO-JAVIER, J.)

DOCTRINE OF THE CASE

Although warrantless searches and seizures are generally considered unreasonable, the rule admits of exceptional instances
when warrantless searches and seizures are considered permissible, such as searches incident of inspection, supervision, and regulation
sanctioned by the State in the exercise of its police power. For a proper exercise of police power, the Court, in Lucena Grand Central
Terminal, Inc. v. JAC Liner, stated that there must be a concurrence of a lawful subject and lawful method.

The Court found that public health was the lawful subject of the police power legislation here. Also, the means employed
by the legislature to protect public health and safety against the production and sale of hazardous products in the market are not
only necessary but reasonable and fair. The FDA Personnel Order was issued to ensure public safety pursuant to the exercise of
FDA's regulatory authority.

FACTS
The Food and Drug Administration (FDA) received a letter from EcoWaste Coalition regarding the
alleged high lead content of Artex Fine Water Colors manufactured by Venus Commercial Co., Inc. (Venus),
without FDA approval. FDA then purchased samples of Artex Fine Water Colors and subjected them to
laboratory analysis. The results showed that the amount of lead in each sample exceeded the maximum tolerable
limits prescribed by FDA.

Consequently, the FDA Acting Director-General issued FDA Personnel Order No. 2014-220, giving
Food and Drug Regulation Officers to proceed and enter at Venus, conduct inspection, and if confirmed
manufacturing and/or distributing Artex Fine Water Colors, to seize the same and/or padlock the
Establishment.

The FDA agents went to Venus’ office to implement the FDA Personnel Order but the security guards
did not allow them in. The FDA agents were consequently constrained to leave, but not without first serving
Venus a Notice of Violation Report.

A few days later, Venus filed the petition for certiorari and prohibition with application for writ of
preliminary injunction and/or temporary restraining order (TRO). In the petition, Venus sought to declare as
unconstitutional Section 30 (4) of R.A. 3720, as amended by R.A. 9711, and Section 2 (b), paragraph (5), Article
III of the IRR for allegedly violative of its constitutional right against illegal search and seizure, as well as the
constitutional command that searches and seizures be covered by judicial warrants or orders. Venus also
assailed, for being supposedly an undue delegation of legislative power, Section 10 (ff) of the amended law.
Finally, it sought to invalidate the FDA Personnel Order for being purportedly violative of its right to due
process.

The Department of Health (DOH) and FDA argued that aside from confirming through laboratory
analysis the high lead content of the product samples of Artex Water Colors, FDA also verified that Venus did
not have a license to operate as a manufacturer of household urban hazardous materials and that the subject
water colors are not FDA registered.

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On the other hand, Venus’ operations manager Joel Nell Coteng testified that the concerned FDA
Operatives were simply armed with FDA Personnel Order without any document bearing the so-called
confirmatory test results on the supposed high lead content.

The Regional Trial Court (RTC) avoided the issue of constitutionality and focused solely on the factual
basis of FDA Personnel Order. It ruled that since there was no showing that laboratory tests were actually done
on the product samples, the right of Venus to due process was violated, hence, the FDA Personnel Order is
void.

On the other hand, the Court of Appeals (CA) reversed and consequently dissolved the writ of
permanent injunction.

ISSUES
(1) Do Sections 12(a) and 30(4) of RA 3720, as amended and Section 2(b), paragraph (5), Article III of
Department Circular No. 2011-0101 violate the Constitutional proscription against unreasonable
searches and seizures?
(2) Does Section 10(ff) constitute an invalid delegation of legislative power?
(3) Does FDA Personnel Order No. 2014-220 violate the guarantee against due process and the right
against self-incrimination?

RULING
(1) NO. The Court held that although warrantless searches and seizures are generally considered
unreasonable, the rule admits of exceptional instances when warrantless searches and seizures are considered
permissible, such as searches incident of inspection, supervision, and regulation sanctioned by the State in the
exercise of its police power. They are better known as administrative searches.

In Lucena Grand Central Terminal, Inc. v. JAC Liner, the Court stated that the proper exercise of police
power requires that there must be a concurrence of a lawful subject and lawful method.

The law is a legitimate exercise of police power if it has general welfare for its object. Here, Sections
12 (a) and 30 (4) of the law, as well Section 2 (b), paragraph (5), Article III of Department Circular No. 2011-
0101 are clearly designed to protect the health and safety of the people against exposure to and use of hazardous
products. More, FDA Personnel Order was specifically issued to prevent Venus from selling toxic watercolors
to protect the public, especially the young children from the risks of ingesting the same or from coming in
contact with the toxic high lead component of the product. There is no question that public health was the
lawful subject of the police power legislation here.

For the requirement of lawful method, the Court seeks to answer whether the means employed by law
are reasonably necessary and not unduly oppressive upon individuals. In United States v. Jamieson-McKames
Pharmaceuticals, the U.S. Court of Appeals for the Eighth (8th) Circuit ruled in favor of the FDA and pronounced
that the drug manufacturing industry was included within the class of closely regulated businesses and that
inspections made by FDA agents were reasonable in the interest of the general public.

In this case, FDA Personnel Order was issued after the FDA Director-General confirmed reports
about the hazardous lead content of Artex Fine Water Colors and following the confirmatory results of

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chemical analysis of product samples. Since the subject water colors are intended for the use of young students
and children in general, the FDA Director-General found it necessary to immediately order the seizure of the
water colors and to order the temporary closure of the establishment to prevent further harm to this vulnerable
sector of the public.

Hence, the Court found that the means employed by the legislature to protect public health and safety
against the production and sale of hazardous products in the market are not only necessary but reasonable and
fair. The FDA Personnel Order was issued to ensure public safety pursuant to the exercise of FDA’s regulatory
authority.

(2) NO. In Department of Trade and Industry v. Steelasia Manufacturing Corp, the Court stated that valid
delegation requires: (1) the completeness of the statute making the delegation; and (2) the presence of a
sufficient standard.

To determine completeness, the policy to be executed, carried out, or implemented by the delegate
must be set forth therein. All the terms and provisions of the law must leave nothing to the delegate except to
implement it. What only can be delegated is not the discretion to determine what the law should be but the
discretion to determine how the law shall be enforced. To be sufficient, the standard must specify the limits of
the delegate's authority, announce the legislative policy, and identify the conditions under which it is to be
implemented.

First, RA 3720, as amended, is complete in itself. Section 3 thereof sets forth the policy to be carried
out or implemented by the delegate, the FDA. Second, the law fixes a standard and the limits of such standards
are sufficiently determinate or determinable. Consistent with the State policy to protect and promote the right
to health of the Filipino people and maintain an effective health products regulatory system, the legislature
strengthened the FDA’s regulatory power over “health products.” Hence, there is no undue delegation of
legislative power in this case.

(3) NO. Alliance for the Family Foundation, Philippines, Inc. v. Garin laid down the aspects of due process:
substantive and procedural:

“In order that a particular act may not be impugned as violative of the due process clause, there must
be compliance with both the substantive and the procedural requirements thereof. Substantive due process
refers to the intrinsic validity of a law that interferes with the rights of a person to his property. Procedural due
process, on the other hand, means compliance with the procedures or steps, even periods, prescribed by the
statute, in conformity with the standard of fair play and without arbitrariness on the part of those who are called
upon to administer it.”

The Court ruled that there is no violation of due process in the present case. Venus was served with a
Notice of Violation Report when the FDA Operatives went to their establishment. Also, under Section 30(4),
the confiscation of the hazardous products is without prejudice to the outcome of the authorized hearing or
appeal.

On the argument that FDA Personnel Order is violative of the right of Venus against self-
incrimination, the Court held that the argument is utterly misplaced. The Order was never executed, hence, no

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watercolor was even seized by the FDA operatives. It bears to stress that the right against self-incrimination
must be invoked at the proper time, that is, when a question calling for an incriminating answer is propounded.
Necessarily then, the right against self-incrimination may only be invoked where there is already an actual case,
whether criminal, civil, or administrative; not before. Hence, the argument of Venus is misplaced, if not
premature.

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GM LORETO P. SEARES, JR. v. NATIONAL ELECTRIFICATION ADMINISTRATION

BOARD
G.R. No. 254336, 18 November 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The tribunal or officer should, in all controversial questions, render its decision in such a manner that the parties to the
proceeding can know the various issues involved, and the reason for the decision rendered. The performance of this duty is
inseparable from the authority conferred upon it.

Here, NEAB failed to pinpoint which of the acts allegedly committed by GM Seares exactly pertain to the first, the
second, and the infraction charged. What NEAB simply did was make a swift shotgun statement that based on the results of its
commissioned audit report, GM Seares was found to have committed all three infractions. There was absolutely no effort at all to
discuss each infraction, let alone, draw its one on one correspondence with the supposed evidence or factual findings on record. Lastly,
citing Repiblic v. Legaspi, Sr., the Supreme Court held that since it is a requirement of due process that the parties to a litigation
be informed of how it was decided, with an explanation of the factual and legal reasons that led to the conclusions of the court, a
decision that does not conform to the form and substance required by the Constitution, and the law, is void and deemed legally
inexistent. Applying the aforementioned principle, the decision rendered by the NEAB, since it did not clearly pinpoint GM Seares’
fault to justify its disciplinary action against the latter, the said decision is null and void.

Citing Zambales II Electric Cooperative, Inc. Board of Directors v. Castillejos Consumers Association, Inc. the Supreme
Court held that the creation of the CDA did not divest of the NEAB of its regulatory jurisdiction over electric cooperatives nor its
disciplinary jurisdiction over the members of the boards of directors and officers of these electric cooperatives. In addition, PD No.
1645 which amended Presidential Decree No. 269 (PD No. 269) broadened the NEAB’s regulatory powers, among others.

Here, the amendments emphatically recognized the NEAB’s power of supervision and control over electric cooperatives;
and gave it the power to conduct investigations, and impose preventive and disciplinary sanctions over the board of director of
regulated entities.

FACTS
Loreto P. Seares, Jr., (GM Seares) was appointed as the General Manager of ABRECO, an electric
cooperative duly registered with the Cooperative Development Authority (CDA). Subsequently, pursuant to
Republic Act No. 10531, the National Electrification Administration Board (NEAB) was granted supervisory
and disciplinary powers over all electric cooperatives. As such, NEAB conducted an audit of ABRECO, and
yielded the result that the latter was in a state of continuous operational retrogression attributable to the alleged
ineffective management of GM Seares.

The NEAB found GM Seares and ABRECO’s officers guilty of Grave Misconduct, Dishonesty, and
Gross Incompetence in the Performance of Official Duties. The following findings were based upon GM
Seares and ABRECO officer’s (1) failed to effectively discharge their functions when they started charging their
consumers at a rate greater than prescribed by the Energy Regulatory Commission; (2) dictated their own
generation rate. In addition, the unfortunate financial condition of ABRECO was also imputed upon the alleged
mismanagement of GM Seares on the cooperative’s affairs. As such, NEAB imposed upon GM Seares the
penalty of removal from office along with the other officers of ABRECO’s board.

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GM Seares filed an appeal before the Court of Appeals (CA), finding fault at NEAB’s ruling for
dissolving ABRECO’s board of directors. Citing Republic Act No. 9520, GM Seares argues that it is the CA
that has the authority to suspend members of the Board of directors and not the NEAB. However, the CA
affirmed that the NEAB has the power to suspend, remove, or replace any or all of the members of an electric
cooperative board of directors and officers.

GM filed before the Supreme Court for an affirmative relief against the decision of the CA. It
challenges the NEAB’s authority to order his removal from office and the dissolution of ABRECO’s Board of
Directors. These powers purportedly pertain to the CDA and not to the NEAB. At any rate, the findings of
NEAB and the CA were allegedly unsupported by substantial evidence.

ISSUES
(1) Does the NEAB have the authority to remove the BOD of ABRECO?
(2) If in the affirmative, did the NEAB exercise this authority in accordance with due process?

RULING
(1) YES. Citing Zambales II Electric Cooperative, Inc. Board of Directors v. Castillejos Consumers Association, Inc.
the Supreme Court held that the creation of the CDA did not divest of the NEAB of its regulatory jurisdiction
over electric cooperatives nor its disciplinary jurisdiction over the members of the boards of directors and
officers of these electric cooperatives. In addition, PD No. 1645 which amended Presidential Decree No. 269
(PD No. 269) broadened the NEAB’s regulatory powers, among others.

Specifically, the amendments emphatically recognized the NEAB’s power of supervision and control
over electric cooperatives; and gave it the power to conduct investigations, and impose preventive and
disciplinary sanctions over the board of director of regulated entities. Under Section 10 of PD No. 269 states
that the NEAB is empowered to issue orders, rules, and regulations to conduct investigations, referenda and
other similar actions in all matters affecting said electric cooperatives and other borrower, or supervised or
controlled entities.

(2) NO. However, despite the acknowledging the power of the NEAB to impose disciplinary measures
against GM Seares and ABRECO’s Board of Directors, the Supreme Court held that such power was exercised
arbitrarily to deprive the latter’s due process. The Court cites the case of Ang Tibay v. Court of Industrial Relations,
where it held that the tribunal or officer should, in all controversial questions, render its decision in such a
manner that the parties to the proceeding can know the various issues involved, and the reason for the decision
rendered. The performance of this duty is inseparable from the authority conferred upon it.

Here, NEAB failed to pinpoint which of the acts allegedly committed by GM Seares exactly pertain to
the first, the second, and the infraction charged. What NEAB simply did was make a swift shotgun statement
that based on the results of its commissioned audit report, GM Seares was found to have committed all three
infractions. There was absolutely no effort at all to discuss each infraction, let alone, draw its one on one
correspondence with the supposed evidence or factual findings on record.

Lastly, citing Repiblic v. Legaspi, Sr., the Supreme Court held that since it is a requirement of due process
that the parties to a litigation be informed of how it was decided, with an explanation of the factual and legal

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reasons that led to the conclusions of the court, a decision that does not conform to the form and substance
required by the Constitution, and the law, is void and deemed legally inexistent.

Applying the aforementioned principle, the decision rendered by the NEAB, since it did not clearly
pinpoint GM Seares’ fault to justify its disciplinary action against the latter, the said decision is null and void.

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ANDREW N. BAYSA v. MARIETTA V. SANTOS

G.R. No. 254328, 02 December 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

For misconduct to be considered an administrative offense, it must be linked to the performance of a public official’s duties.
Grave misconduct requires elements such as corruption, clear intent to break the law, or a blatant disregard for established rules. If
these elements are absent, the violation is usually categorized as simple misconduct.

Even if Baysa's actions in issuing the demolition orders were marked by grave abuse of discretion or errors, this does not
automatically constitute an administrative violation unless there is clear evidence of bad faith. The Court did not find that Baysa
acted with a "premeditated, obstinate, or intentional purpose" in issuing the orders. There was no evidence that he acted with malice
or bad faith against Santos. The burden of proof rests on Santos to demonstrate, through substantial evidence, that Baysa was
driven by ill intent in his decision. However, she failed to allege or establish such evidence during the proceedings.

FACTS
Andrew N. Baysa (Baysa) was the Provincial Adjudicator of the Office of the Provincial Agrarian
Reform Adjudicator, Department of Agrarian Reform Adjudication Board (DARAB). Baysa rendered a
decision in a DARAB case unfavorably against Spouses Constantino Pascual and Zenaida Pascual (Spouses
Pascual). A writ of execution and a writ of demolition was issued against Spouses Pascual. While she had no
participation in the proceedings, Marietta Santos (Santos) furnished a copy of the motions and writ of execution
and demolition. Santos was never impleaded in the DARAB case. When the Sheriff attempted to serve the writ
on Santos, she noticed that part of the properties to be demolished was one of her buildings. Santos sought
relief before the Regional Trial Court (RTC) of Malolos City. She went to DARAB, but Baysa denied her
motion. She then filed an administrative complaint of Simple Misconduct against Baysa.

The Ombudsman (OMB) found Baysa guilty of Simple Misconduct and imposed the penalty of
suspension for three (3) months without pay. Baysa appealed to the Court of Appeals (CA) but the CA affirmed
the decision of the Ombudsman.

ISSUE
Can Baysa be held liable for misconduct?

RULING
NO. Misconduct is generally understood as wrongful or improper behavior driven by a deliberate or
intentional motive. It involves intentional wrongdoing or a purposeful breach of legal rules or standards of
conduct.

For misconduct to be considered an administrative offense, it must be linked to the performance of a

public official’s duties. Grave misconduct requires elements such as corruption, clear intent to break the law,
or a blatant disregard for established rules. If these elements are absent, the violation is usually categorized as
simple misconduct.

Even if Baysa's actions in issuing the demolition orders were marked by grave abuse of discretion or
errors, this does not automatically constitute an administrative violation unless there is clear evidence of bad
faith. The Court did not find that Baysa acted with a "premeditated, obstinate, or intentional purpose" in issuing

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the orders. There was no evidence that he acted with malice or bad faith against Santos. The burden of proof
rests on Santos to demonstrate, through substantial evidence, that Baysa was driven by ill intent in his decision.
However, she failed to allege or establish such evidence during the proceedings.

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SPOUSES MARCELO G. FLORES and MEDELYN FLORES v. SPOUSES LEOPOLDO

A. ESTRELLADO and ENRIQUETA ESTRELLADO, BEDE TABALINGCOS, ATTY. CRES
DAN D. BANGOY, ATTY. RAYMOND CARAOS, and ATTY. SOCRATES RIVERA
G.R. No. 251669, 07 December 2021, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Under Rule 47 of the Rules of Court, the grounds for annulment are limited to extrinsic fraud and lack of jurisdiction.
Arcelona v. Court of Appeals, however, recognized a third ground—denial of due process. A violation of a person’s right to be
heard by counsel is tantamount to a violation of said person’s right to due process. But just because a party is assisted by counsel in
a given case does not automatically mean that his or her right to counsel and due process are observed. For where counsel commits a
mistake so gross, palpable and inexcusable as to result in violation of his or her client’s substantive rights, such mistake may also
constitute due process violation.

Here, Spouses Flores were denied due process of law since they were represented by counsels who were either disbarred or
suspended from the practice. Although on paper, Spouses Flores were supposedly represented by Tabalingcos and Rivera throughout
the proceedings, the latter had already been disbarred and suspended by the Court, respectively. Thus, in reality, the spouses had no
counsel at all. Such legal assistance provided by Tabalingcos and Rivera were ineffectual, if not downright criminal. The annulment
of the trial court’s judgment is, therefore, warranted.

FACTS
In 2009, Spouses Marcelo and Medelyn Flores (Spouses Flores) engaged Atty. Bede Tabalingcos
(Tabalingcos) as their counsel in a case for the nullification of certain loan documents and foreclosure
proceedings. Unknown to Spouses Flores, Tabalingcos had been disbarred by the Supreme Court (SC) in its
Order dated 10 July 2012. Yet, Tabalingcos continued to represent them in the case.

Tabalingcos eventually withdrew as the Spouses Flores’ counsel and caused the entry of appearance of
Atty. Cres Dan Bangoy (Atty. Bangoy). Although Spouses Flores seemingly gave their conformity to such
change of counsel, such was only due to Tabalingcos’ misrepresentation that Atty. Bangoy was his law firm
partner. Despite the entry of appearance of Atty. Bangoy, Spouses Flores would still follow up their case with
Tabalingcos. They only dealt with Tabalingcos, no one else, when the case was pending with the trial court.
They never stopped paying Tabalingcos his legal fees.

Without the Spouses Flores’ knowledge, Atty. Bangoy filed pleadings on their behalf. Meanwhile, Atty.
Raymond Caraos (Atty. Caraos), another supposed associate of Tabalingcos, filed a Memorandum on Spouses
Flores’ behalf in the same case. As it was, Tabalingcos merely used the credentials of his so-called law firm
partner and associate to continue representing the spouses despite his disbarment.

After the Regional Trial Court (RTC) dismissed their complaint, Spouses Flores discovered that a
certain Atty. Socrates Rivera (Atty. Rivera) filed a motion for reconsideration on their behalf. Again,
Tabalingcos assured them that Atty. Rivera was another of his associates.

The motion for reconsideration allegedly signed by Atty. Rivera got denied. Tabalingcos, nevertheless,
assured the spouses that the matter may still be rectified through an appeal. Subsequently, a notice of appeal
was filed on their behalf, also purportedly signed by Atty. Rivera. The said appeal was dismissed for failure to
file their appellants’ brief.

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Spouses Flores’ case went further up to the SC via a petition for review on certiorari, supposedly
through Atty. Rivera. The said petition was dismissed for failure to state the material dates and to submit a soft
copy of the petition as required under the Efficient Use of Paper Rule, among others.

Spouses Flores confronted Atty. Rivera who denied having prepared, signed, and submitted any of
their pleadings, as well as being a supposed associate of Tabalingcos. Reeling from Tabalingcos’ betrayal,
Spouses Flores looked up to Atty. Rivera to rectify the situation. Atty. Rivera emphatically agreed and thereafter
filed a Compliance Cum Manifestation before the SC wherein he stated that his signatures in all previous
pleadings were forged. Moreover, Atty. Rivera allegedly filed a complaint with the Court of Appeals (CA), and
later on furnished the spouses with a spurious Resolution granting the said complaint.

Atty. Rivera filed additional pleadings before the CA. In the meantime, the trial court sought to
implement its earlier decision. Rivera countered with a Motion to Implement the CA’s purported Resolution
dated 5 November 2016, which was eventually denied.

Upon denial of the motion, Spouses Flores investigated Atty. Rivera’s legal standing and discovered
that the SC had suspended Rivera from the practice of law for three years in a Resolution dated 9 August 2016.
Hence, he could not have lawfully represented them in the proceedings nor file any pleading on their behalf.

With the aid of their new counsel, Spouses Flores filed a petition for annulment of judgment before
the CA, claiming that they were denied due process of law. The CA dismissed the petition. It essentially held
that the alleged violation of Spouses Flores’ right to due process was caused by their own negligence, noting
that they were furnished copies of pleadings and orders throughout the proceedings.

On their present appeal before the Supreme Court, Spouses Flores maintain that the right to be assisted
by counsel includes the right to be assisted by a member of the bar in good standing. Since their so-called
counsels were either disbarred or suspended while handling their cases, they were essentially deprived of their
right to counsel and denied due process of law. Moreover, they consistently and persistently monitored their
case. Unfortunately, they could not have guarded against the cunning misrepresentations of their so-called
counsels as they are an elderly couple with low education whose only guidance was that of their lawyers.

ISSUE
Should the judgment of the RTC be annulled on the ground of denial of due process?

RULING

YES. A petition for annulment of judgment is a remedy in equity which courts view with an attitude
of reluctance as it is an exception to the time-honored doctrine of immutability of final judgments. Thus, to
prevent parties aggrieved by final judgments, orders, or resolutions from abusing this exceptional remedy, the
Court installed safeguards limiting its application under Rule 47 of the Rules of Court. Under the rules, the
grounds for annulment are limited to extrinsic fraud and lack of jurisdiction. Arcelona v. Court of Appeals,
however, recognized a third ground—denial of due process.

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Section 1, Article III of the 1987 Constitution ordains that no person shall be “deprived of life, liberty,
or property without due process of law. Collateral to this right is the right to be assisted by counsel for the
purpose of ensuring that due process rights of litigants are truly observed. Section 14(2), Article III of the 1987
Constitution further mandates that in all criminal prosecutions, the accused shall enjoy the right to be heard by
himself and counsel. There is no reason, however, not to apply this safeguard to civil cases as well.

Verily, a violation of a person’s right to be heard by counsel is tantamount to a violation of said person's
right to due process. Thus, following Arcelona, proceedings wherein one or both parties were not duly
represented by counsel may be susceptible to annulment of judgment under Rule 4 7 of the Rules of Court.

But just because a party is assisted by counsel in a given case does not automatically mean that his or
her right to counsel and due process are observed. For where counsel commits a mistake so gross, palpable and
inexcusable as to result in violation of his or her client's substantive rights, such mistake may also constitute
due process violation.

Thus, in Heirs of Pael v. Destura, the Court upheld the dispositions of the CA which annulled the trial
court's ruling on grounds, inter alia, that therein respondents’ former counsel Atty. Oliver Lozano enigmatically
failed to file an answer to the complaint despite the extremely valuable property involved. Atty. Lozano, too,
successively filed a notice of appeal from the default judgment and a motion for new trial, though he knew full
well that both remedies were utterly inconsistent with and contradictory to each other. Consequently, the Court
affirmed the finding of the CA that Atty. Lozano’s suspicious actuations denied respondents of their day in
court.

In the present case, Spouses Flores were denied due process of law since they were represented by
counsels who were either disbarred or suspended from the practice. Although on paper, Spouses Flores were
supposedly represented by Tabalingcos and Rivera throughout the proceedings, the latter had already been
disbarred and suspended by the Court, respectively. Thus, in reality, the spouses had no counsel at all.

It may be that Tabalingcos was still a lawyer in good standing when Spouses Flores engaged his services
in 2009 until his disbarment on 10 July 2012. But it bears stress that the right to counsel is absolute and may be
invoked at all times. More so, in the case of an ongoing litigation, it is a right that must be exercised at every
step of the way, with the lawyer faithfully keeping his client company. Hence, despite Tabalingcos’ earlier
assistance to petitioners, the Court is constrained to rule that Spouses Flores were not afforded their day in
court.

The Court finds Heirs of Pael applicable here as well for the actuations of Tabalingcos and Rivera do
not only constitute gross, palpable and inexcusable mistake or negligence, but something much worse—fraud.

To recall, despite Tabalingcos’ disbarment, he continued to represent Spouses Flores using the
credentials of Atty. Bangoy and Atty. Caraos. But he could not have legally done so, for a disbarred lawyer is
no longer permitted to practice law either directly or indirectly. Rivera, on the other hand, had more fraudulent
tricks up his sleeve. He concealed the fact of his suspension and he continued to lawyer for Spouses Flores
post judgment. More, he lulled the spouses into believing that he had been diligently attending to their case
when, in truth, the documents he showed them were either spurious or otherwise not sanctioned by our rules.

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To be sure, such legal assistance provided by Tabalingcos and Rivera were ineffectual, if not downright
criminal. The Court, therefore, rules that Spouses Flores were deprived of their day in court, warranting the
annulment of the trial court’s judgment.

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ANGKLA: ANG PARTIDO NG MGA MARINONG PILIPINO, INC. (ANGKLA),

and SERBISYO SA BAYAN PARTY (SBP) v. COMMISSION ON ELECTIONS, et al.
G.R. No. 246816, 07 December 2021, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Subscribing to this concept of "one person, one vote" would cause chaos in the political landscape not only insofar as the
application of Section 11 (b) of R.A. 7941 to party-list systems is concerned, but also with respect to laws reapportioning legislative
districts. At any rate, the Court have already discussed in the 2020 Decision that the Constitution does not prescribe absolute
proportionality in distributing seats to party-lists, organizations, or coalitions. On the contrary, Congress is given a wide latitude of
discretion in setting the parameters for determining the actual volume and allocation of party-list representation in the House of
Representatives.

Here, in the exercise of its discretion, Congress enacted R.A. No. 7941 which contained mechanisms that prevent the
distribution of party-list seats based on absolute proportionality such as the three-seat cap and the two-tiered seat allocation. Notably,
these mechanisms are disadvantageous to the two-percenters and beneficial to non-two-percenters.

FACTS
ANGKLA: Ang Partido Ng Mga Pilipinong Marino, Inc. (ANGKLA) and Serbisyo sa Bayan Party
(SBP) move for reconsideration of the Court's Decision dated September 15, 2020 (2020 Decision) upholding
the constitutionality of the proviso in Section 11 (b) of Republic Act No. 7941 (R.A. No. 7941) or the Party-
List Systems Act.

The challenged proviso states:

Section 11. Number of Party-List Representatives. x x x

xxx xxx xxx

(b) The parties, organizations, and coalitions receiving at least two percent (2%) of the total
votes cast for the party- list system shall be entitled to one seat each: Provided, That those
garnering more than two percent (2%) of the votes shall be entitled to additional seats in
proportion to their total number of votes: Provided, finally, That each party, organization,
or coalition shall be entitled to not more than three (3) seats.

As settled in Barangay Association for National Advancement and Transparency v. Commission on Elections
(BANAT), Section 11 (b) of R.A. 7941 is to be applied as follows:

Round 1:
a. The participating parties, organizations or coalitions shall be ranked from highest
to lowest based on the number of votes they each garnered in the party-list
election.
b. Each of those receiving at least two percent (2%) of the total votes cast for the
party-list system shall be entitled to and guaranteed one seat each.

Round 2, Part 1:

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a. The percentage of votes garnered by each of the parties, organizations and

coalitions is multiplied by the remaining available seats after Round 1. All party-
list participants shall participate in this round regardless of the percentage of votes
they garnered
b. The party-list participants shall be entitled to additional seats based on the
product arrived at in (a). The whole integer of the product corresponds to a
party's share in the remaining available seats. Fractional seats shall not be
awarded.
c. A party-list shall be awarded no more than two (2) additional seats.

Round 2, Part 2:
a. The party-list party, organization, or coalition next in rank shall be allocated one
(1) additional seat each until all available seats are completely distributed.

ANGKLA and SBP insist that the manner of allocating additional seats in the second round violates
the "one person, one vote" policy protected under the equal protection clause and our democratic institutions.
They assert that "all votes are equal and should carry the same weight." Thus, votes counted and considered in
the allocation of guaranteed seats in the first round should be deducted before allocating seats in the second
round. To hold otherwise would be an instance of double counting of votes where the votes already used to
elect a representative via the guaranteed seat are once again used to elect a representative for the additional seat.

Furthermore, they alleged that the preference over two-percenters must be limited to the grant of
guaranteed seats in first round. in order not to dilute the weight of the votes for the non-two percenters. Such
is inconsistent with the voters' constitutional right to an equally weighted vote.

ANGKLA and SBP pray that the proviso in Section 11 (b) of R.A. No. 7941 be declared
unconstitutional. Their proposed formula should be applied as follows:

1. The parties, organizations, and coalitions taking part in the party-list elections shall be ranked from
the highest to the lowest based on the total number of votes they each garnered in the party-list
elections.
2. Each of the parties, organizations, and coalitions taking part in the party-list elections receiving at
least two percent (2%) of the total votes cast under the party-list elections shall be entitled to one
(1) guaranteed seat each.
3. Votes amounting to two percent (2%) of the total votes cast for the party-list elections obtained
by each of the participating parties, organizations, and coalitions should then be deducted from
the total votes of each of these party-list groups that have been entitled to and given guaranteed
seats.
4. The parties, organizations, and coalitions shall thereafter be re-ranked from highest to lowest based
on the recomputed number of votes, that is, after deducting the two percent (2%) stated in
paragraph 3.
5. The remaining party-list seats (or the "additional seats") shall then be distributed in proportion to
the recomputed number of votes in paragraph 3 until all the additional seats are allocated.
6. Each party, organization, or coalition shall be entitled to not more than three (3) seats.

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In its Comment, the Commission on Elections (COMELEC), through the Office of the Solicitor
General (OSG), argued that the Court in the 2010 Decision only applied the intent and language of Section 11
(b) of R.A. No. 7941. It could not have devised a different formula for allocating party-list seats since such
matter is an act of Congress.

ISSUE
Does the proviso in Section 11 (b) of R.A. No. 7941, as implemented through the BANAT formula,
violate the "one person, one vote" policy, as well as the equal protection clause?

RULING
NO. Section 11 (b) of R.A. No. 7941 does not violate the “one person, one vote” policy and the equal
protection clause.

First, ANGKLA and SBP are misguided in their view on how the "one person, one vote" policy applies
to the party-list system.

To reiterate, the principle of one person-one vote was discussed in the Dissenting Opinion of retired
Associate Justice Antonio T. Carpio in Aquino III v. COMELEC (Aquino) thus:

The constitutional standard of proportional representation is rooted in equality in voting

power — that each vote is worth the same as any other vote, not more or less. In constitutional
parlance, this means representation for every legislative district "in accordance with the
number of their respective inhabitants, and on the basis of a uniform and progressive ratio"
or proportional representation. Thus, the principle of "one person, one vote" or equality in
voting power is inherent in proportional representation

Verily, Justice Carpio's concept of "one person, one vote" is akin to absolute proportionality. Meaning,
the higher the population, the more representatives. Subscribing to this concept of "one person, one vote"
would cause chaos in the political landscape not only insofar as the application of Section 11 (b) of R.A. 7941
to party-list systems is concerned, but also with respect to laws reapportioning legislative districts. At any rate,
the Court have already discussed in the 2020 Decision that the Constitution does not prescribe absolute
proportionality in distributing seats to party-lists, organizations, or coalitions. On the contrary, Congress is
given a wide latitude of discretion in setting the parameters for determining the actual volume and allocation
of party-list representation in the House of Representatives.

In the exercise of its discretion, Congress enacted R.A. 7941 which contained mechanisms that prevent
the distribution of party-list seats based on absolute proportionality such as the three-seat cap and the two-
tiered seat allocation. Notably, these mechanisms are disadvantageous to the two-percenters and beneficial to
non-two-percenters. As illustrated in the 2020 Decision:

Consider the three-seat limit. This ensures the entry of various interests into the legislature
and bars any single party-list from dominating the party-list representation. Otherwise, the
rationale behind party-list representation in Congress would be defeated. But viewed from a
different perspective, this safeguard dilutes, if not negates, the number of votes that a party-
list party, organization, or coalition obtains.

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Consider also the two-tiered seat allocation. This serves to maximize representation and fulfil
the 20% requirement under Section 5 (1), Article VI of the Constitution. Seen in a different
light, however, this arithmetical allocation in practice inflates the weight of each of the votes
considered in the second round, as far as the non-two percenters are concerned, but deflates the weight
of each of the votes considered in the second round, as regards the two-percenters. This is because
the two-percent (2%) vote-threshold needed to guarantee a seat in the House of
Representatives would definitely be more than the votes it would take to earn an additional
seat, whether the Court apply ANGKLA & SBPs' proposal or the doctrine in BANAT.

Second. The BANAT formula is in accordance with the clear language and intent of the law.

The intention behind the proviso is clear — only the two-percenters were supposed to participate in
the second round of seat allocation and with full votes at that. This can be deduced from the language of the
proviso which originally allocated seats only to those "garnering more than two percent (2%) of the votes."

Thus, in Veterans Federation Party v. COMELEC, the Court crafted a formula for seat allocation with
two (2) notable characteristics: first, only the two-percenters were allowed to participate in the second round
of seat allocation; and second, the two-percenters participated in the second round of seat allocation with their
full votes intact. It was not until 2009, through the Court's ruling in BANAT, when the second round of seat
allocation was opened up to non-two-percenters by removing the 2% threshold for additional seats. But this
was only to fulfill the constitutional mandate that 20% of the total membership of the House of Representatives
be reserved for party-list representatives under Article VI, Section 5 (2) of the Constitution.

In other words, only the first characteristic of the Veterans formula was negated by the removal of the
2% threshold; the second characteristic was retained. This is in clear recognition of the original intent behind
the law to allow the two-percenters to participate in the second round of seat allocation with their full votes
intact.

Third. Allowing the two-percenters to participate in the second round of seat allocation with full votes
does not result in double-counting of votes. The Court have extensively discussed this in the ponencia, thus:

ANGKLA & SBP foist the idea that only the votes of the two-percenters were counted and
considered in the first round.
xxx xxx xxx

Nothing is farthest from the truth. All votes were counted, considered, and used during the
first round of seat allocation, not just those of the two-percenters. But in the end, the non-
two-percenters simply did not meet the requisite voting threshold to be allocated a guaranteed
seat.

The "total number of votes cast under the party-list system," the very divisor of the formula,
the very index of proportionality, requires that all votes cast under the party-list system be
counted and considered in allocating seats in the first round, be it in favor of a two-percenter
or a non-two-percenter. This only goes to show that all votes were counted and considered in

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the first round. Just because the non-two-percenters were not allocated a guaranteed seat does
not mean that their votes were accorded lesser weight, let alone, disregarded. It simply means
that they did not reach the proportional threshold in the first round.
xxx xxx xxx

Just as how all votes were considered in the first round of seat allocation, all votes would be
considered in the first part of the second round of seat allocation, too. Lest it be
misunderstood, though, there is no second round of counting at this stage. The Court do not
recompute the number of votes obtained by each party nor the percentage of votes they
garnered. The Court do not tally the votes anew. The Court do not modify the data used in
the first round. Instead, the number of votes cast for each party as determined in the first
round is preserved precisely to ensure that all votes are counted only once.

On the other hand, imposing a 2% penalty against two-percenters in the second round would yield an
absurd result which, too, had been illustrated in the 2010 Decision:

In ANGKLA & SBP’ proposal, however, a 2% deduction will be imposed against party-list X
before proceeding to the second round. This would result in X falling to the bottom of the
ranking with zero percent (0%) vote, dimming its chances, if not disqualifying it altogether,
for the second round. This is contrary to the language of the statute which points to
proportionality in relation to the TOTAL number of votes received by a party, organization,
or coalition in the party-list election, and the intention behind the law to acknowledge the two-
percenters' right to participate in the second round of seat allocation for the additional seats.

Fourth. Even assuming arguendo that the proviso in Section 11 (b) is void, this does not automatically
result in the application of ANGKLA & SBP's formula.

Nowhere is it stated in R.A. No. 7941 that a two percent (2%) deduction would first be imposed on
the two-percenters before they may be allowed to participate in the second round of seat allocation. Neither
does R.A. 7941 read that the parties will be re-ranked before distributing additional seats. Clearly, ANGKLA
& SBP would have the Court plant words into R.A. No. 7941 which are not there.

The Court is not in the position though to give its imprimatur on ANGKLA & SBP’s construction of
Section 11 (b) of R.A. No. 7941 at the risk of expanding the law as currently couched. The Court does not
"correct" laws by reading into them more than what they contain; the Court merely applies what is written. And
what is currently written in Section 11 (b) of R.A. No. 7941 does not need correction as it does not offend any
constitutional guarantee.

To stress, The Court is not here to discuss the merits of each formula, only to determine what the
applicable formula actually is based on the text of the law and in accordance with Constitutional standards. And
as stated, the textual progression of Section 11 (b) of R.A. No. 7941 is mirrored by the BANAT formula and,
contrary to ANGKLA & SBP' claim, does not offend the equal protection clause. Thus, until R.A. No. 7941 is
amended, Section 11 (b) as outlined in BANAT remains to be the applicable law.

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JOSEPH ROBLE PEÑAS v. COMMISSION ON ELECTIONS

UDK-16915, 15 February 2022, FIRST DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

A respondent in a criminal prosecution or investigation is not duty bound to follow up on his or her case; it is the governing
agency that is tasked to promptly resolve it.

As held in Cervantes v. Sandiganbayan it is the duty of the prosecutor to speedily resolve the complaint, as mandated by
the Constitution, regardless of whether the Peñas did not object to the delay or that the delay was with his acquiescence provided
that it was not due to causes directly attributable to him.

FACTS
In 2009, Joseph Roble Peñas (Peñas) filed his certificate of candidacy for Mayor of Digos City, Davao
Del Sur for the 2010 National and Local Elections. He ran under the Banner of the Nationalist People’s
Coalition. Thereafter, Peñas filed with the Commission on Elections (COMELEC) his Statement of
Contributions and Expenditures (SOCE) wherein he declared his total election campaign expenditures in the
amount of Php 600,000.00.

Subsequently, the COMELEC Campaign Finance Unit (CFU) informed Peñas that pursuant to Section
13 of Republic Act No. 7166 (RA No. 7166), he exceeded the expenditure limit allowed by law. He was given
ten days from receipt of the letter to submit a written explanation why no charges should be filed against him
for overspending. As such, Peñas submitted an Affidavit of Correction/Explanation before the COMELEC
Law Department wherein he explained that he failed in good faith to specify the breakdown of his expenses in
his SOCE. Further, because he was overwhelmed with emotions for having won in the mayoralty elections in
his city, he failed to thoroughly review the SOCE which was prepared by his Secretary. Ultimately, he claims
that his expenditure only amounted to Php 241, 574.01 deducting the printing for sample ballots and for
lawyer’s fees which amounted to Php 112,924.00 and Php 245,000.00, respectively.

Despite such response, the CFU filed a formal complaint against Peñas for violating Section 100 in
relation to Section 262 of the Omnibus Election Code (OEC). In his Counter-Affidavit, Peñas stated that since
he was appointed party Chairman of NPC for Digos City, Davao Del Sur, he was authorized to pay for any and
all expenses of NPC-Digos City as well as reasonable expenses redounding to the benefit of all the NPC local
candidates. As such, he contends that the expenditure regarding the printing of the sample ballots and for
lawyer’s fees were NPC expenses and not of his own personal expenditure as mayoralty candidacy. Hence, the
said expenses should be deducted from the computation of his expenditures during the 2010 campaign period.

The COMELEC En Banc (En Banc) found probable cause to hold Peñas for trial and ordered the
filing of an Information against him for violating the OEC.

Before the Court, the COMELEC, through the Office of the Solicitor General (OSG), contends that
Peñas failed to make a timely assertion of his right to speedy disposition of his case. Citing Cagang v.
Sandiganbayan (Cagang), Peñas should have done overt acts to manifest his assertion of the right, such as the
filing of a motion for early resolution. Since he failed to do so, Peñas was deemed to have acquiesced to the
delay, if any, and had already waived his right to the speedy disposition of cases.

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ISSUE
Did COMELEC violate Peñas’ right to speedy disposition of cases?

RULING
YES. In Cagang, the Supreme Court laid down certain guidelines in resolving issues concerning
inordinate delay, to wit:

First, the right to speedy disposition of cases is different from the right to speedy trial. While the
rationale for both rights is the same, the right to speedy trial may only be invoked in criminal prosecutions
against courts of law. The right to speedy disposition of cases, however, may be invoked before any tribunal,
whether judicial or quasi-judicial. What is important is that the accused may already be prejudiced by the
proceeding for the right to speedy disposition of cases to be invoked.

Second, a case is deemed initiated upon the filing of a formal complaint prior to a conduct of a
preliminary investigation. This Court acknowledges, however, that the Ombudsman should set reasonable
periods for preliminary investigation, with due regard to the complexities and nuances of each case. Delays
beyond this period will be taken against the prosecution. The period taken for fact-finding investigations prior
to the filing of the formal complaint shall not be included in the determination of whether there has been
inordinate delay.

Third, courts must first determine which party carries the burden of proof. If the right is invoked
within the given time periods contained in current Supreme Court resolutions and circulars, and the time
periods that will be promulgated by the Office of the Ombudsman, the defense has the burden of proving that
the right was justifiably invoked. If the delay occurs beyond the given lime period and the right is invoked, the
prosecution has the burden of justifying the delay.

If the defense has the burden of proof, it must prove first, whether the case is motivated by malice or
clearly only politically motivated and is attended by utter lack of evidence, and second, that the defense did not
contribute to the delay.

Once the burden of proof shifts to the prosecution, the prosecution must prove first, that it followed
the prescribed procedure in the conduct of preliminary investigation and in the prosecution of the case; second,
that the complexity of the issues and the volume of evidence made the delay inevitable; and third, that no
prejudice was suffered by the accused as a result of the delay.

Fourth, determination of the length of delay is never mechanical. Courts must consider the entire
context of the case, from the amount of evidence to be weighed to the simplicity or complexity of the issues
raised.

An exception to this rule is if there is an allegation that the prosecution of the case was solely motivated
by malice, such as when the case is politically motivated or when there is continued prosecution despite utter
lack of evidence. Malicious intent may be gauged from the behavior of the prosecution throughout the
proceedings. If malicious prosecution is properly alleged and substantially proven, the case would automatically
be dismissed without need of further analysis of the delay.

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Another exception would be the waiver of the accused to the right to speedy disposition of cases or
the right to speedy trial. If it can be proven that the accused acquiesced to the delay, the constitutional right
can no longer be invoked.

In all cases of dismissals due to inordinate delay, the causes of the delays must be properly laid out and
discussed by the relevant court.

Fifth, the right to speedy disposition of cases or the right to speedy trial must be timely raised. The
respondent or the accused must file the appropriate motion upon the lapse of the statutory or procedural
periods. Otherwise, they are deemed to have waived their right to speedy disposition of cases.

Applying these guidelines, there is clear inordinate delay in how the COMELEC handled the
preliminary investigation and subsequent resolution of Peñas’ case.

First. The right to speedy disposition of cases may be invoked to question the inordinate delay in the
course of preliminary investigations by the COMELEC. While fact-finding proceedings and investigations such
as these do not form part of the criminal prosecution proper, the respondent may already be prejudiced by such
proceedings

To be sure, a respondent, such as Peñas, though not yet imprisoned, is nevertheless disadvantaged by
the uncertainties of his potential criminal case. He is forced to live under a cloud of anxiety, suspicion and
often, hostility. His financial resources may be drained, his association is curtailed, and he is subjected to public
obloquy. Not to mention, his reputation is already tarnished despite the presumption of innocence in his favor.

Second. The COMELEC failed to observe its own prescribed period for resolving cases when it finally
recommended the filing of an Information against Peñas on December 9, 2020 or more than six (6) years from
when the formal complaint was filed on November 12, 2014.

As stated, the complaint against Peñas was filed on November 12, 2014. Subsequently, Peñas filed his
counter-affidavit on February 9, 2015. By Resolution No. 18-0665 dated November 5, 2018, or about four (4)
years from when the complaint was filed, the COMELEC ordered the filing of an Information against Peñas’
Peñas moved for reconsideration and this time, it took the COMELEC another two (2) years to issue
Resolution No. 220-00121-33 dated December 9, 2020 to deny the motion. Indubitably, the COMELEC went
beyond the prescribed period for the conduct of a preliminary investigation.

Third. In view of the COMELEC's failure to observe its own prescribed period for resolving Peñas’
case, the burden of justifying the delay is shifted to it. Consequently, it must prove first, that it followed the
prescribed procedure in the conduct of preliminary investigation and in the prosecution of the case; second,
that the complexity of the issues and the volume of evidence made the delay inevitable; and third, that no
prejudice was suffered by the accused as a result of the delay. The COMELEC, however, failed to establish
these circumstances.

Finally. Peñas cannot be deemed to have waived his right to a speedy disposition of his case and against
inordinate delay.

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Citing Javier v. Sandiganbayan, the Court cannot fault Peñas herein for only invoking his right to a speedy
disposition of his case in the present petition. As held, a respondent in a criminal prosecution or investigation
is not duty bound to follow up on his or her case; it is the governing agency that is tasked to promptly resolve
it. As held in Cervantes v. Sandiganbayan it is the duty of the prosecutor to speedily resolve the complaint, as
mandated by the Constitution, regardless of whether the Peñas did not object to the delay or that the delay was
with his acquiescence provided that it was not due to causes directly attributable to him.

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BRYAN TA-ALA Y CONSTANTINO v. PEOPLE OF THE PHILIPPINES

G.R. No. 254800, 20 June 2022, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 2 and Section 3, Article III of the Constitution provides for :

Sec. 2. The right of the people to be secure in their persons, houses, papers, and effects against
unreasonable searches and seizures of whatever nature and for any purpose shall be inviolable, and
no search warrant or warrant of arrest shall issue except upon probable cause to be determined
personally by the judge after examination under oath or affirmation of the complainant and the
witnesses he may produce, and particularly describing the place to be searched and the persons or
things to be seized.

Any evidence obtained in violation of Section 2, Article III of the Constitution is legally inadmissible in evidence as a
fruit of the poisonous tree. This principle is covered by this exclusionary rule:

Sec. 3. x x x
(2) Any evidence obtained in violation of the preceding section shall be inadmissible for any purpose
in any proceeding.

Here, Ta-ala's warrantless arrest is clearly and convincingly a case of frame up and planting of evidence. The story of the
police officers conjures a fabricated narrative meant to legitimize the unlawful warrantless arrest of Ta-ala and the incidental seizure
of the items in question. For without seeing Ta-ala in actual possession of the pistol, and thereafter, inside the box of alleged
contrabands, the police officers had no reason to effect his warrantless arrest in flagrante delicto, let alone, seize the same and the
other supposed illegal items in his possession. They had no probable cause to arrest Ta-ala without a warrant and to search and
seize the box as an incident of the arrest.

FACTS
In their Affidavit of Arrest, SPO4 Liberato S. Yorpo (SPO4 Yorpo) and SPO1 Jerome G. Jambaro
(SPO1 Jambaro) testified that they were instructed to go undercover to retrieve a package containing firearms
and its accessories shipped by ATLAS Shippers International Incorporated. The two officers were instructed
to wait for the suspects to arrive and claim their package and conduct an arrest.

On August 6, 2016, two male claimants on board a car arrived. Further, SPO4 Yorpo and SPO1
Jambaro averred that they carried the package and placed it at the back of the driver's seat. Wilford Palma
(Palma), one of the claimants, immediately opened and checked the content of the box exposing to the two
officers. While Bryan Ta-ala (Ta-ala), the driver of the car, alighted and also checked the box wherein a handle
of a pistol was brandishing on his back. Upon seeing the firearm and knowing the content of the box, SPO4
Yorpo and SPO1 Jambaro introduced themselves as police officers and apprehended Ta-ala and Palma.

In other words, SPO4 Yorpo and SPO1 Jambaro allegedly saw Ta-ala alight from the driver's seat to
inspect the contents of the box at the back of the driver's seat, they already noticed a pistol tucked in his waist
and visible from his back. And yet, the same pistol was also actually among the contents of the box that they
subsequently seized from Ta-ala and Palma.

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On August 8, 2016, Chief Intel Division of the CIDG, P/Superintendent Randy Glenn G. Silvio
(Silvio) filed with the Department of Justice (DOJ) a Letter-Complaint against Ta-ala and Palma. As alleged by
Ta-ala, no criminal information was filed on August 9, 2016 when the maximum 36 hour-period of warrantless
detention from August 6, 2016 arrest had lapsed.

Assistant State Prosecutor Michael A. Vito Cruz (ASP Vito Cruz) recommended the filing of two
separate informations against Ta-ala for illegal possession of firearm and for illegal possession of firearm
accessories both under Section 28, Republic Act No. 10591 otherwise known as Comprehensive Firearms and
Ammunition Regulation Act (R.A. No. 10591), respectively. On the other hand, the complaint against Palma
was dismissed for lack of probable cause, albeit he was recommended for admission to the DOJ Witness
Protection Program.

On September 6, 2016, a month after Ta-ala's arrest, the DOJ filed the first two Informations against
Ta-ala before the Regional Trial Court (RTC). Ta-ala filed a Motion to Quash Information and to Suppress
Evidence Illegally Obtained. The RTC ruled against Ta-ala prompting him to file an appeal before the Court
of Appeals (CA).

Over two months after Ta-ala's arrest, ASP Vito Cruz found probable cause against Ta-ala for violation
of Section 33, R.A. No. 10591; and Sections 101(a) and 3601 of the Tariff and Customs Code of the Philippines.
Another two Informations were filed against Ta-ala.

Before the RTC, Ta-ala prayed to consolidate the cases against him, judicially determine probable cause,
defer the issuance of a warrant of arrest, or in the alternative, allow him to post bail, quash the Information,
and suppress illegally obtained evidence. The RTC rendered a decision against Ta-ala. On appeal, the CA
ordered the consolidation of the twin Petitions, and affirmed Ta-ala’s warrantless arrest valid.

ISSUES
(1) Was Ta-ala's warrantless arrest valid?
(2) Was there a valid inquest or preliminary investigation on Ta-ala?

RULING
(1) NO. Section 5, Rule 113 of the Revised Rules of Criminal Procedure provides:

Section 5. Arrest without warrant; when lawful. – A peace officer or a private person
may, without a warrant, arrest a person:

(a) When, in his presence, the person to be arrested has committed, is actually
committing, or is attempting to commit an offense;
(b) When an offense has just been committed, and he has probable cause to believe based
on personal knowledge of facts or circumstances that the person to be arrested has
committed it; and
(c) When the person to be arrested is a prisoner who has escaped from a penal
establishment or place where he is serving final judgment or is temporarily confined
while his case is pending, or has escaped while being transferred from one
confinement to another.

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In cases falling under paragraph (a) and (b) above, the person arrested without a
warrant shall be forthwith delivered to the nearest police station or jail and shall be proceeded
against in accordance with Section 7 of Rule 112.

The Affidavit of Arrest reveals that the subject pistol was seen tucked in the waist of Ta-ala and
consequently seized from his possession and control. But the same one unit pistol was also listed in the
inventory of contrabands supposedly found in the box which Palma had claimed from Atlas Shipping
International. The Affidavit of Arrest is firsthand account of what happened during Ta-ala's arrest. How can
the same exact item be supposedly seized from Ta-ala and found in the box at the same time?

This discrepancy cannot simply be brushed aside. Ta-ala's warrantless arrest is clearly and convincingly
a case of frame up and planting of evidence. The story of the police officers conjures a fabricated narrative
meant to legitimize the unlawful warrantless arrest of Ta-ala and the incidental seizure of the items in question.
For without seeing Ta-ala in actual possession of the pistol, and thereafter, inside the box of alleged
contrabands, the police officers had no reason to effect his warrantless arrest in flagrante delicto, let alone, seize
the same and the other supposed illegal items in his possession. They had no probable cause to arrest Ta-ala
without a warrant and to search and seize the box as an incident of the arrest.

The police officers fabricated a narrative that is a lie. This untruthfulness cannot be the basis for
probable cause to effect the warrantless arrest and thereafter the warrantless search. The Court cannot tolerate
such a nefarious scheme, for it impacts the life and liberty of anyone in the situation of Ta-ala, who as a
consequence was unlawfully arrested and locked up in jail without bail.

Section 2 and Section 3, Article III of the Constitution command:

SEC. 2. The right of the people to be secure in their persons, houses, papers, and
effects against unreasonable searches and seizures of whatever nature and for any purpose
shall be inviolable, and no search warrant or warrant of arrest shall issue except upon probable
cause to be determined personally by the judge after examination under oath or affirmation of
the complainant and the witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized.

Any evidence obtained in violation of this provision is legally inadmissible in evidence

as a fruit of the poisonous tree. This principle is covered by this exclusionary rule:

SEC. 3. x x x (2) Any evidence obtained in violation of the preceding section shall be
inadmissible for any purpose in any proceeding.

Unfortunately, the story foisted by the police officers is not credible. The Court does not believe that
what they said truly happened. In view of this absence of a justification for the warrantless arrest and search,
or the absence of any other explanation to prove probable cause, these acts are unlawful. As a result, the pieces
of evidence obtained as a result of this illegal warrantless arrest and search – the alleged firearm and its
ammunitions, and the boxful of alleged firearm accessories or paraphernalia – are fruits of the poisonous tree,
which are inadmissible in any proceeding for any purpose whatsoever.

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(2) NO. The Court ruled that the inquest should have stopped the moment the timelines under Article
125 of the Revised Penal Code had lapsed, viz.:

Art 125 - Delay in the Delivery of Detained Persons to the Proper Judicial Authorities. - The
penalties provided in the next preceding article shall be imposed upon the public officer or
employee who shall detain any person for some legal ground and shall fail to deliver such
person to the proper judicial authorities within the period of: twelve (12) hours, for crimes or
offenses punishable by light penalties, or their equivalent; eighteen (18) hours, for crimes or
offenses punishable by correctional penalties, or their equivalent; and thirty-six (36) hours, for
crimes or offenses punishable by afflictive or capital penalties, or their equivalent.

In every case, the person detained shall be informed of the cause of his detention and shall be
allowed upon his request, to communicate and confer at any time with his attorney or counsel.

ASP Vito Cruz had 36 hours to complete the inquest, resolve the complaint, and file the Informations,
if any. Had he needed more time to resolve, he should have converted the inquest to a regular preliminary
investigation, but Ta-ala should have been released in the meantime.

Here, it took one month for ASP Vito Cruz to file the first two Informations for violation of Section
28 of R.A. No. 10591, and another one month for him to file the next two Informations for violation of Section
33 of R.A. No. 10591, without Ta-ala's consent, much less, a waiver of his rights under Article 125, or his right
to provisional liberty considering he already posted bail not once but twice. By making Ta-ala suffer
incarceration as ASP Vito Cruz bade his time to complete the inquest, ASP Vito Cruz and the DOJ violated
Ta-ala's right not to be deprived of his liberty without due process of law.

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NORMAN CORDERO MARQUEZ v. COMMISSION ON ELECTIONS

G.R. No. 258435, 28 June 2022, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In administrative cases, such as election cases, the burden of proof falls on the complainant. When the complainant fails
to show in a satisfactory manner the facts upon which he bases his claims, Marquez is under no obligation to prove his exception
or defense.

Here, the COMELEC relied on bare allegations by its Law Department in concluding that Marquez is a nuisance
candidate, thus: (a) Marquez has no bona fide intention to run for Senator as he is virtually unknown to the entire country; and
(b) Marquez is running for a national position as an independent candidate. Accordingly, the Court ruled that non-membership
in a political party and not being virtually known to the entire country were not enough grounds to declare Marquez as a nuisance
candidate.

FACTS
Norman Cordero Marquez (Marquez) filed a Certificate of Candidacy (COC) for Senator in the 2022
National and Local Elections. Accordingly, the Commission on Elections (COMELEC) Law Department motu
proprio filed a petition to declare Marquez as a nuisance candidate alleging, among others, that he had without
any bona fide intention to run for office and that he was not virtually known to the entire country except
possibly in the locality where he resides.

Marquez argued that he was not a nuisance candidate. He had been actively campaigning all over the
Philippines for about five (5) years already. In addition, as an advocate of animal welfare and cofounder of
Baguio Animal Welfare, Cordillera to the Rest of the Philippines he had the opportunity to travel and attend to
countless animal rescue projects, as well as extend free legal assistance in animal cruelty cases nationwide, all in
collaboration with established animal welfare groups. As a result of his successful projects and operations, he
had been featured several times in various media.

Subsequently, the COMELEC declared Marquez a nuisance candidate and subsequently canceled his
COC. The COMELEC held that Marquez had the burden to prove that he was not a nuisance candidate, and
that he failed to show that he is “known well enough nationwide.” Hence, Marquez charged the COMELEC
with grave abuse of discretion due to shifting the burden of proving the genuine intention to run for office to
him.

ISSUE
Was the COMELEC correct in declaring Marquez as a nuisance candidate?

RULING
NO. The Omnibus Election Code provides that an “election campaign” refers to any act designed to
promote the election or defeat of a particular candidate which shall include:

a. Forming organizations, associations, clubs, committees or other groups of persons for the purpose
of soliciting votes and/or undertaking any campaign for or against a candidate;

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b. Holding political caucuses, conferences, meetings, rallies, parades, or other similar assemblies, for
the purpose of soliciting votes and/or undertaking any campaign or propaganda for or against a
candidate;
c. Making speeches, announcements or commentaries, or holding interviews for or against the
election of any candidate for public office;
d. Publishing or distributing campaign literature or materials designed to support or oppose the
election of any candidate; or
e. Directly or indirectly soliciting votes, pledges or support for or against a candidate.

History would show that election campaigns invariably entail the expenditure of funds regardless of
the methodology employed. A simple door-to-door campaign and the airing of political advertisements on the
radio and television, while varied in scope, both require candidates to spend money. The difference lies only in
how much money a candidate is willing, able, and allowed to spend. Hence, for equating the perceived inability
of Marquez to mount an election campaign — with his supposed absence of bona fide intention to run for
office, the COMELEC indirectly violated the proscription against conflating a candidate's financial capacity
with bona fide intention to run.

In administrative cases, such as election cases, the burden of proof falls on the complainant. When the
complainant fails to show in a satisfactory manner the facts upon which he bases his claims, Marquez is under
no obligation to prove his exception or defense.

Here, the COMELEC unfairly shifted to Marquez the burden of proving his genuine intention to run
for office. As the COMELEC itself held, “he who alleges must prove.” Thus, it is the COMELEC Law
Department which should adduce evidence in support of its petition to declare Marquez a nuisance candidate,
not the other way around.

As shown, the COMELEC relied on bare allegations by its Law Department in concluding that
Marquez is a nuisance candidate, thus: (a) Marquez has no bona fide intention to run for Senator as he is
virtually unknown to the entire country; and (b) Marquez is running for a national position as an independent
candidate, which only “adds a burden to the task of making himself known to the entire country within the
short span of time during the campaign period.” Allegation, without more, is not evidence. Bona fide intent is
present when a candidate is able to demonstrate that he or she is serious in running for office. Several
circumstances belied the COMELEC’s conclusion that Marquez did not have any bona fide intention to run
for Senator.

Another thing, the COMELEC considered non-membership in a political party as proof of Marquez’s
alleged lack of bona fide intent to run for the position of Senator. Certainly, he should not be prejudiced by
this fact alone, for neither the law nor the rules impose such requirement on persons intending to run for public
office.

On this score, Marquez even explained that there had been a marked influx of funding from sponsors
and donors for animal welfare groups, as well as an increase in volunteers, rescuers and fellow advocates who
collectively aspire for reform in the animal welfare system. For these reasons, he never felt the need to associate
himself with any political party. Certainly, the COMELEC ought to balance its duty to ensure that the electoral

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process is clean, honest, orderly, and peaceful without conflating a candidate’s bona fide intention to run with
his or her capacity to wage a campaign, his or her political connections, alliances, or the lack thereof.

Finally, the COMELEC insists that Marquez was not virtually known to the entire country except
possibly in the locality where he resides. Assuming this to be true, it does not, standing alone, suffice to declare
one a nuisance candidate. In fact, it was not among the grounds for declaration of a nuisance candidate
enumerated in Section 69 of the Omnibus Election Code.

Further, declaring one a nuisance candidate simply because he or she is not known to the entire country
reduces the electoral process — a sacred instrument of democracy — to a mere popularity contest. The matter
of the candidate being known (or unknown) should not be taken against that candidate but is best left to the
electorate. As it is, our democratic and republican state is based on effective representation. Thus, the
electorate’s choices must be protected and respected.

Of note, nuisance candidates, as an evil to be remedied, do not justify the adoption of measures, not
specifically indicated under our election laws or rules, which would consequently bar seemingly unpopular
candidates from running for office.

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THE SENATE OF THE PHILIPPINES et al. v. THE EXECUTIVE SECRETARY SALVADOR

C. MEDIALDEA and SECRETARY OF HEALTH FRANCISCO T. DUQUE III
G.R. No. 257608, 05 July 2022, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The power of Congress to conduct inquiries in aid of legislation is inherent in its power to legislate. It is broad-based as
it was on the proposition that a legislative body cannot legislate wisely or effectively in the absence of information respecting the
conditions which the legislation is intended to affect or change. Section 21, Article VI of the 1987 Constitution empowers the
Congress to conduct inquiries in aid of legislation. However, the Court cannot exercise the power on behalf of the Blue Ribbon
Committee of the Senate lest the sacred principle of separation of powers where mutual respect by and between the three departments
of the government be unduly violated.

The Court consequently defers to the remedy found within the Senate’s own lofty jurisdiction. The availability of this
remedy under Section 3 of the Senate Rules of Procedure Governing Inquiries in Aid of Legislation effectively proscribes a premature
resort to the present special civil action for certiorari.

FACTS
By virtue of the COVID-19 pandemic, the Department of Health (DOH) received seventy-seven
billion pesos (P77,000,000,000.00) to address the health crisis. Of the said fund, thirty-seven billion pesos
(P37,000,000,000.00) was allotted for the procurement of Personal Protective Equipment (PPE).

In its 2020 Annual Audit Report, the Commission on Audit (COA) noted a deficiency of
P67,323,186,570.57 in public funds intended for the government’s COVID-19 response. This spurred an
investigation by the Senate Blue Ribbon Committee on the budget utilization of the DOH.

Meantime, several senators authored resolutions directing various committees of the Senate to conduct
inquiries relative to the disbursement of funds to address the COVID-19 pandemic.

The Senate Blue Ribbon Committee claims it had been undertaking an inquiry in aid of legislation. The
inquiry had been taking place for several hearings already when President Duterte initially complained of the
alleged browbeating of Executive Department officials appearing as resource persons at these hearings.

The President’s reaction came to a head when, through Executive Secretary Medialdea, he authorized
the issuance of the subject Memorandum prohibiting all officials and employees of the Executive Department
from appearing and attending the inquiry.

As worded, the Memorandum bore an instruction “for strict compliance.” It did not bear though the
initial ground of the President for objecting to the appearance and attendance of Executive Department officials
at the hearings. Instead, the Memorandum complained of their inability to fulfil their duties in relation to the
people’s right to health during the pandemic and contested the purpose of the inquiry as being in aid of
legislation. The Memorandum further asserted that the inquiry has turned into a preliminary investigation of
sorts meant to identify the person or persons allegedly liable for irregularities that existing statutes already define
and punish.

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The Senate noted that after the issuance of the Memorandum, Executive Department officials invited
to attend the inquiry had begged off citing the prohibition.

Executive officials, including DOH Secretary Francisco T. Duque, III (DOH Secretary Duque), who
initially graced the hearings, had ceased to attend the subsequent hearings on the inquiry. DOH Secretary Duque
referenced the Memorandum as the reason he had to excuse himself.

Viewing the subject Memorandum as an obstruction to their constitutional function to conduct

inquiries in aid of legislation, the Senate, through Resolution No. 131 resolved to challenge it before the Court.

ISSUE
Is direct resort to the Supreme Court via a Petition for Certiorari and Prohibition the proper remedy
to compel the attendance of officials of the Executive Department following the President’s jurisdictional
challenge to the legislative inquiry?

RULING
NO. Under Section 1, Rule 65 of the Rules of Court, a petition for certiorari is an extraordinary remedy
that is available only upon showing that a tribunal, board, or officer exercising judicial or quasi-judicial functions
has acted without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of
jurisdiction.

The writ of certiorari is not issued to correct every error that may have been committed by lower courts
and tribunals. It is a remedy specifically to keep lower courts and tribunals within the bounds of their
jurisdiction. In our judicial system, the writ is issued to prevent lower courts and tribunals from committing
grave abuse of discretion in excess of their jurisdiction.

For certiorari to prosper, the following requisites must concur: 1. The writ is directed against a tribunal,
board, or officer exercising judicial or quasi-judicial functions; 2. Such tribunal, board, or officer has acted
without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction;
and 3. There is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law.

It is basic that Rule 65 may be availed of only when there is no appeal or any other plain, speedy, and
adequate remedy in the ordinary course of law. Thus, where this remedy actually exists but the same is
peremptorily omitted, a Rule 65 petition will not prosper.

Here, when the subject Memorandum got issued, invited officials from the Executive Department
stopped attending the Senate hearings. For the Senate, the Memorandum was an affront to its Constitutional
duty to conduct inquiries in aid of legislation.

The power of Congress to conduct inquiries in aid of legislation is inherent in its power to legislate. It
is broad-based as it was on the proposition that a legislative body cannot legislate wisely or effectively in the
absence of information respecting the conditions which the legislation is intended to affect or change. Section
21, Article VI of the 1987 Constitution empowers the Congress to conduct inquiries in aid of legislation.

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Inquiries in aid of legislation serve as tools to enable the legislative body to gather information and,
thus, legislate wisely and effectively; and to determine whether there is a need to improve existing laws or enact
new or remedial legislation, albeit the inquiry need not result in any potential legislation. To be within the
jurisdiction of the legislative body making it, the inquiry must be material or necessary to the exercise of a power
vested in it by the Constitution, such as to legislate or to expel a member.

Medialdea and Duque III, on the other hand, argue that the Senate Blue Ribbon Committee did not
have jurisdiction to conduct the hearings in question. The focal point of the inquiries, according to them, was
not the 2020 COA Report but the alleged anomalies in the measures undertaken for the COVID-19 pandemic
response — matters which fall within the jurisdiction of the Joint Congressional Oversight Committee created
under the Bayanihan Acts.

Section 5 of RA 11469 or the Bayanihan to Heal as One Act indeed created an oversight committee
composed of four (4) members of each house to be appointed by the Senate President and the House Speaker,
respectively. Said Committee was tasked to determine whether the acts, orders, rules, and regulations of the
President were within the restrictions provided in the law. The oversight committee was retained in RA 11494
or the Bayanihan to Recover as One Act.

Medialdea and Duque III assert that the hearings in question were conducted in the exercise of the
Senate’s oversight function under Section 22, Article VI of the 1987 Constitution.

Verily, the Memorandum is founded on a jurisdictional challenge — whether the subject inquiry of the
Senate Blue Ribbon Committee properly falls within its jurisdiction or the within the jurisdiction of the Joint
Congressional Oversight Committee created under the Bayanihan Acts.

In asserting that the subject inquiry falls within the jurisdiction of the Joint Congressional Oversight
Committee created under the Bayanihan Acts, may the President object to the inquiry as not being in aid of
legislation? Senate vs. Ermita has ruled in the affirmative.

Notably, the forum to address such jurisdictional claim is the Senate and its committees themselves.
This recognition is meant to accord the highest respect for the Senate’s own Rules of Procedure Governing
Inquiries in Aid of Legislation. Undeniably, therefore, the Blue Ribbon Committee of the Senate has a remedy
within its office to resolve the jurisdictional challenge raised by the President.

To be sure, the Court cannot exercise the power on behalf of the Blue Ribbon Committee of the Senate
lest the sacred principle of separation of powers where mutual respect by and between the three departments
of the government be unduly violated.

The Court consequently defers to the remedy found within the Senate’s own lofty jurisdiction. The
availability of this remedy under Section 3 of the Senate Rules of Procedure Governing Inquiries in Aid of
Legislation effectively proscribes a premature resort to the present special civil action for certiorari.

In the same breadth, the Court cannot rule that there exists an actual case or controversy that is ripe
for judicial adjudication. There is no immediate or threatened injury to the power of the Senate because it has

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yet to exercise the same. Hence, the Court still cannot tell whether this power, despite its proper exercise, has
been disobeyed by the President as a result of his Memorandum.

Unless and until the Senate has resolved with finality the jurisdictional challenge of the President, there
can be no actual case or controversy to speak of yet.

In sum, the resolution of the petition does not hinge ultimately on the constitutionality or
unconstitutionality of the Memorandum. The Constitutional challenge may be resolved on some other ground
— here, by referencing the aforementioned power of the Senate under its own Rules of Procedure Governing
Inquiries in Aid of Legislation.

The petition is easily differentiated from Senate vs. Ermita. The present case presents a direct
jurisdictional challenge to the subject inquiry and its characterization. The President asserts — the inquiry falls
within the jurisdiction of the Joint Congressional Oversight Committee created under the Bayanihan Acts,
hence, beyond the power of legislative inquiry of the Senate and its Committees. The Senate has yet to resolve
this claim and the arising challenge in the manner set forth in the Rules of Procedure Governing Inquiries in
Aid of Legislation. On the other hand, Ermita involved a challenge on the ground of executive privilege and a
blanket prohibition that did not reject any subject inquiry as one in aid of legislation.

All told, the Court is constrained to dismiss the petition for having been prematurely filed. The Court
deems it no longer necessary to resolve the other issues raised by the parties.

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SPOUSES LOURDES V. RAFAEL and RAUL I. RAFAEL v. GOVERNMENT SERVICE

INSURANCE SYSTEM (GSIS)
G.R. No. 252073, 18 July 2022, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The first paragraph of Section 30 of RA 8291 empowers GSIS to settle any dispute arising under this statute and other
statutes administered by it. The second paragraph then identifies the hearing officer (i.e., a Board member or a GSIS lawyer-official)
and the decision-making body (i.e., the Board) to decide the dispute referred to in the first paragraph.

The Court cannot interpret and apply Section 30 in the manner the Court of Appeals did. To do so would violate the
aggrieved party’s right to due process. It is the solemn duty of this Court to ensure that laws are interpreted in a manner consistent
with the letter, spirit, and intent of the Constitution and the law.

Here, the Court holds that the dispute with GSIS did not arise under the laws administered by it, and therefore, the
determination of their dispute relied upon the application of other sets of laws is a matter the GSIS-BOT has neither the authority
nor the specialized knowledge and expertise to resolve originally and exclusively.

FACTS
Lourdes Rafael (Lourdes) was an employee of the Department of Budget and Management (DBM).
She submitted an Application for a House and Lot with GSIS. Subsequently, GSIS issued a Buyer’s Data Sheet
(BDS) and a loan evaluation form, stating that the term of the loan was “15 years graduated” or “15 years GPS”
— graduated payment scheme with monthly amortization of P3,094.35.

Thereafter, Lourdes and her husband Raul Rafael (Sps. Rafael), on one hand, and ARB Construction
Company, Inc. (ARB), on the other, entered into a Deed of Conditional Sale over a parcel of land.

After the property was turned over to them, the DBM started to deduct the monthly amortization
from the salary of Lourdes. ARB then transferred all its interests, rights, and participation in the Deed of
Conditional Sale to GSIS via a Deed of Absolute Sale with Assignment.

Later, GSIS informed Sps. Rafael that they had an outstanding balance of P384,354.72 and that final
demand was being made to settle the amount within 15 days from notice, otherwise, the deed of conditional
sale would be cancelled. Subsequent thereto, spouses Rafael received a notarized letter, cancelling the Deed of
Conditional Sale effective 30 days from notice with demand to vacate and turn over the property to GSIS.
Another notice to vacate was sent to them, prompting Lourdes to inquire from GSIS why the deed of
conditional sale was cancelled.

Sps. Rafael then filed a complaint for specific performance, injunction, and damages against the GSIS.
They claimed they had already paid P532,248.20, representing 172 monthly installments deducted from the
salary of Lourdes from May 1991 up to September 2005. Further, they pointed out that the Deed of Conditional
Sale had no stipulation for the graduated increase of the monthly installments. Also, they mentioned that neither
they nor the DBM received any prior notice from the GSIS regarding the supposed increase. Hence, they
concluded that the act of GSIS in unilaterally increasing the required monthly installment payment was made
without legal authority and was a blatant and abusive breach of the provisions of the Deed of Conditional Sale.

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On the other hand, GSIS explained that the adjustment of the monthly installments was made pursuant
to Board Resolution No. 365, recalculating the interest in Deeds of Conditional Sale under the Graduated
Payment Scheme, and Lourdes was allegedly notified thereof. GSIS averred that the monthly amortizations
should have been paid starting February 1991; however, the collection was only made on May 1991.

The Regional Trial Court (RTC) ruled in spouses Rafael’s favor. The Court of Appeals (CA), however,
reversed the ruling of the trial court.

ISSUE
Did the CA err in its ruling, thereby violating the aggrieved party’s right to due process?

RULING
YES. The first paragraph of Section 30 of RA 8291 empowers GSIS to settle any dispute arising under
this statute and other statutes administered by it. The second paragraph then identifies the hearing officer (i.e.,
a Board member or a GSIS lawyer-official) and the decision-making body (i.e., the Board) to decide the dispute
referred to in the first paragraph.

The Court cannot interpret and apply Section 30 in the manner the Court of Appeals did. To do so
would violate the aggrieved party’s right to due process. It is the solemn duty of this Court to ensure that laws
are interpreted in a manner consistent with the letter, spirit, and intent of the Constitution and the law.

The proceedings contemplated under Section 30 are a two-fold function of investigation and
adjudication of rights and obligations. They involve a sequential and seamless process, and not a disjointed one.
The end-goal of the investigative stage is the proper administration of justice in the adjudicative stage. The
investigative aspect cannot stand apart from the objectives of the adjudication – fairness and correctness of the
decision rendered. This is because a biased investigation will lead to a skewed adjudication. The adage garbage
in, garbage out, holds true for the Section 30 process.

While technically, the investigative phase does not itself determine rights and obligations of specific
parties on a specific set of facts, the investigation is crucial to and part and parcel of the pure quasi-judicial
function of adjudication. The investigation, therefore, cannot be treated like the investigation conducted by a
party-litigant itself, which would not yield an impartial result. Since, the fruits of the investigation will be the
foundation of the adjudication, the investigation must itself be impartial both as to the qualities of the hearing
officer and the report the latter renders.

On the other hand, adjudication is simply a quasi-judicial function. Thus, it is legally demanded that it
be carried out impartially and independently by an impartial and independent decision-maker. As a result, the
hearing officer who investigated the complaint and made recommendations on the dispute cannot directly
participate in the adjudication of rights and obligations.

For this two-fold process, the cardinal rights of due process must be observed. This intuitive
conclusion is dictated by the common-sensical legal principle that a body cannot be the investigator, prosecutor,
and judge of its own complaint or its own assailed action. More important, it is demanded by years of
jurisprudence that a quasi-judicial function, both as to the principal decision-making duty and the ancillary
process of investigation to gather facts and make recommendations, must comply with the due process

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requirements, which in turn should be evaluated based on the standard set forth, curiously, in Government Service
Insurance System v. Court of Appeals, amplifying Ang Tibay v. Court of Industrial Relations::

... what Ang Tibay failed to explicitly state was, prescinding from the general principles
governing due process, the requirement of an impartial tribunal which, needless to say, dictates that
one called upon to resolve a dispute may not sit as judge and jury simultaneously, neither may he review
his decision on appeal.

In Government Service Insurance System v. Court of Appeals, the investigator who had already recommended
a particular outcome on the applicant’s eligibility for post-death benefits was barred from sitting in the Board
that was determining this particular issue. He was told to recuse himself from directly participating in the
determination of rights and obligations of the claimant. This was meant to ensure the impartiality and
independence of the decision-making process.

Accordingly, the clause any dispute arising under this Act and any other laws administered by the GSIS
– the basis for the jurisdiction of the GSIS-BOT jurisdiction under Section 30 of RA 8291 – cannot be invoked
as regards disputes that compromise the due process requirement of impartiality and independence of the
hearing officer, the decision-maker, and the investigation and adjudication they each perform.

In addition, the clause must be construed in a manner that does not make it a potestative condition
dependent upon the sole will of the obligor and deemed written into every obligation assumed by GSIS. If
pursuant to Section 30, it were up to the GSIS-BOT to determine the fulfillment of its obligations, this scheme
will be both unfair and offensive to the principle of mutuality of contracts. The Court must avoid an
interpretation of Section 30 that makes it a potestative condition, which in turn is void.

Thus, for these purposes, any dispute arising under what falls with the GSIS-BOT’s jurisdiction must refer
only to disputes about matters that the GSIS-BOT has the statutory authority to act on, but not to those that
have not been committed to it. These are disputes regarding matters on which the GSIS-BOT has acquired
expertise and specialized knowledge.

Section 30 must be read and applied consistent with the doctrine of primary jurisdiction that “courts
will hold off from determining a controversy involving a question within the jurisdiction of an administrative
agency,particularly when its resolution demands the special knowledge, experience, and services of the
administrative tribunal to determine technical and intricate matters of fact.”

In the case of the GSIS-BOT, the disputes within its primary jurisdiction would include those
concerning the availability of benefits, the amounts thereof, the conditions of their availability, and the
circumstances warranting their termination or revocation, including those of loans, to ensure the actuarial
solvency of its funds, in other words, the determination of the interpretations of the parameters of these
benefits. These would be the same examples of matters that fall within the jurisdiction of the hearing officer to
investigate and recommend about.

Conversely, disputes that reduce the GSIS as an adverse party-litigant itself, and its policies, as mere
counter-arguments to the claims of a complaining party, do not qualify as any dispute arising under, as mentioned,

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Section 30 of RA 8291. Essentially, these are disputes that refer to matters already extraneous to those within
the authority, specialized knowledge, and expertise of GSIS-BOT to act on.

Here, the Court holds that the dispute with GSIS did not arise under the laws administered by it, and
therefore, the determination of their dispute relied upon the application of other sets of laws is a matter the
GSIS-BOT has neither the authority nor the specialized knowledge and expertise to resolve originally and
exclusively.

In support of this holding, the Court refers to both the prayer for relief of the Complaint and its
allegations of ultimate facts, including the legal arguments mistakenly pleaded in the Complaint.

As a decision-maker, GSIS cannot restrain itself not to cancel the conditional sale or otherwise compel
itself to continue and complete the sale; as a contracting party it may, but not as a decision-maker under Section
30. Specific performance is the remedy of requiring exact performance of a contract in the specific form in
which it was made, or according to the precise terms agreed upon. It is the actual accomplishment of a contract
by a party bound to fulfill it. When the main relief sought is specific performance, the action is incapable of
pecuniary estimation within the exclusive jurisdiction of the Regional Trial Court. Also, GSIS cannot compute
damages with binding effect; neither can it impose damages against itself.

In Rubia v. GSIS, the Court pronounced that “needless to say, where proper, under Section 36, the
GSIS may be held liable for the contracts it has entered into in the course of its business investments. For GSIS
cannot claim a special immunity from liability in regard to its business ventures under said Section. Nor can it
deny contracting parties, in our view, the right of redress and the enforcement of a claim, particularly as it arises
from a purely contractual relationship of a private character between an individual and the GSIS.”

Verily, the trial court correctly exercised jurisdiction over spouses Rafael’s Complaint.

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GIORGIDI B. AGGABAO and AMELITA S. NAVARRO v. COMMISSION ON

ELECTIONS (COMELEC) and LAW DEPARTMENT
G.R. No. 258456, 26 July 2022, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Section 2 of Article IX-C of the 1987 Constitution empowers the COMELEC to exercise jurisdiction over all contests
relating to the elections, returns and qualifications of all elective officials, and to decide all questions affecting elections. It is mandated
to "investigate and, where appropriate, prosecute cases of violations of elections laws, including acts or omissions constituting election
frauds, offenses and malpractices."

Here, even after its acceptance of Ayson's CONA, which initially appeared to be regular, the COMELEC became
duty bound to take cognizance of, and investigate, the material information coming from Senator Lacson that Partido Reporma
had not issued any CONA in favor of Ayson. The lack of hearing precludes the Court from resolving who between Ayson and
Aggabao was the real official candidate of Partido Reporma.

FACTS
Amelita S. Navarro (Navarro) filed her Certificate of Candidacy (COC) for Mayor of Santiago City,
Isabela for the May 9, 2022 National and Local Elections (2022 Elections). She was officially nominated by the
Partido para sa Demokratikong Reporma (Partido Reporma) for the mayoralty race. She attached to her COC
a copy of her Certificate of Nomination and Acceptance (CONA) signed by Senator Panfilo M. Lacson (Senator
Lacson), the Chairperson of Partido Reporma.

One Christopher G. Ayson (Ayson) also filed a COC for Mayor of the same city. He, too, declared in
his COC that he was nominated by Partido Reporma. He submitted a CONA which he claimed was also signed
by Senator Lacson. Upon learning of Ayson's aforesaid declaration, Senator Lacson sent the Commission on
Election (COMELEC) Law Department a Letter, disclaiming that Partido Reporma issued any CONA in favor
of Ayson. He emphasized that Navarro was the official candidate of Partido Reporma for Mayor of Santiago
City, Isabela for the 2022 elections.

Subsequently, Navarro withdrew her candidacy and opted to run for Vice-Mayor of the city instead.
In her Statement of Withdrawal, she declared that she would be substituted by Giorgidi B.Aggabao (Aggabao)
who is also a member of Partido Reporma. Immediately, Aggabao filed his COC and stated that he was officially
nominated by Partido Reporma as evidenced by his CONA signed by Senator Lacson.

In its disposition, the COMELEC released Document No. 21-3973, informing Navarro that she was
deemed to be an independent candidate pursuant to Section 15 of COMELEC Resolution No. 10717 because
Partido Reporma nominated two (2) candidates for the same mayoralty post, more than the number allowed to
be voted for the elective position (i.e., one [1]). In response, Aggabao clarified that Navarro already withdrew
her COC for Mayor and he filed his COC as substitute candidate. Further, Senator Lacson sent another letter
to COMELEC reiterating that Navarro was the party’s official candidate prior to her withdrawal, and that they
never issued a CONA to Ayson as the latter was not even a member of the party.

In Document No. 21-7467, the COMELEC Law Department reflected the COMELEC En Banc
Decision which recognized the withdrawal of Navarro effective in November 2021. But on a later date, it
maintained that Navarro is an independent candidate pursuant to Section 15 of COMELEC Resolution No.

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10717. Consequently, Aggabao’s COC as a substitute cannot be given due course. Additionally, in the
COMELEC’s Certified List of Candidates for the 2022 Elections, Navarro’s name did not appear under the
column of “Mayor”, but in the “Vice-Mayor” column instead. Ayson’s name was indicated as an independent
candidate for "Mayor”, while Agabao’s name was not in the list.

Aggabao filed a motion for reconsideration which was denied under Document No. 22-0176.
COMELEC insisted that both Ayson and Navarro were independent candidates and Aggabao’s COC cannot
be given due course.

Before the Supreme Court (SC), Aggabao and Navvaro charged the COMELEC and its Law
Department with grave abuse of discretion when it declared Navarro as an independent candidate and denied
Aggabao’s substitution. Moreover, they seek the issuance of a temporary restraining order (TRO) and/or writ
of status quo ante order against the implementation of Document No. 21-7467, which the SC granted.

In its comment, COMELEC, through the Office of the Solicitor General (OSG) argued that since
Navarro was an independent candidate, Aggabao could not have substituted her for the mayoralty post pursuant
to Section 77 of the Omnibus Election Code (OEC) in relation to Section 40 of COMELEC Resolution No.
10717. It also asserted that it merely exercised its ministerial duty when it received Ayson's COC and CONA,
both of which it had accorded the presumption of regularity.

ISSUES
(1) Has the petition been rendered moot by the conclusion of the 2022 Elections?
(2) Did the COMELEC properly exercised its quasi-judicial function over the conflicting CONA’s of
Ayson and Navvaro?
(3) Did the COMELEC commit grave abuse of discretion when it refused to perform its adjudicative
duty?

RULING
(1) YES. There is mootness of the petition.

The conclusion of the 2022 National and Local Elections and the subsequent proclamation of one
Sheena Tan as the Mayor-elect of Santiago City, Isabela have undoubtedly rendered the petition moot insofar
as it seeks to nullify the denial of Aggabao's COC as substitute of Navarro, the non-inclusion of Aggabao's
name as a mayoralty candidate, and Navarro's declaration as an independent candidate. A case is moot when it
ceases to present a justiciable controversy by virtue of supervening events, so that an adjudication of the case
or a declaration on the issue would be of no practical value or use.

Here, the election of Tan to the contested mayoralty post has put an end to the dispute, and none of
the complained actions by COMELEC even if wrong will not undo the outcome of the election to this office.

Despite the mootness of a case, however, the Court may still render a decision if it finds that:
(a) there is a grave violation of the Constitution;
(b) the case involves a situation of exceptional character and is of paramount public interest;
(c) the issues raised require the formulation of controlling principles to guide the Bench, the Bar
and the public; and

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(d) the case is capable of repetition yet evading review

As eruditely explained by Associate Justice Maria Filomena D. Singh during the deliberation, the third
exception applies here. Left unchecked, the COMELEC may repeat the underlying questionable acts or
omissions which resulted in the assailed dispositions, albeit not necessarily against Aggabao and Navarro
themselves again but against some other individuals in elections to come. These underlying questionable acts
or omissions include:

(a) ignoring the clear and repeated certifications and letters of a particular political party about the identity
of the candidate it seeks to endorse and the falsity of a candidate's claim of endorsement by that
particular political party;
(b) failing to conduct a summary hearing on the candidates' conflicting claims pertaining to their party
membership and endorsement; and
(c) emasculating the TRO issued by the Court by perpetuating the erroneous COC cancellation and
improperly denying one's right to be substituted as a candidate.

(2) NO. The COMELEC failed to exercise its powers and functions.

The Constitution and the Omnibus Election Code confer the powers and functions of the COMELEC
which may be classified into administrative, quasi- legislative, and quasi-judicial. Bedol v. COMELEC expounds:

The quasi-judicial power of the COMELEC embraces the power to resolve controversies
arising from the enforcement of election laws, and to be the sole judge of all pre-proclamation
controversies; and of all contests relating to the elections, returns, and qualifications. Its
administrative function refers to the enforcement and administration of election laws. In the
exercise of such power, the Constitution (Section 6, Article IX- A) and the Omnibus Election
Code (Section 52 [c]) authorize the COMELEC to issue rules and regulations to implement
the provisions of the 1987 Constitution and the Omnibus Election Code. The quasi-judicial
or administrative adjudicatory power is the power to hear and determine questions of fact to
which the legislative policy is to apply, and to decide in accordance with the standards laid
down by the law itself in enforcing and administering the same law.

When the COMELEC receives or acknowledges receipt of COCs and CONAs filed in due form, it
performs the administrative function of enforcement and administration of all laws and regulations pertaining
to the conduct of an election. Section 76 of the Omnibus Election Code in relation to Section 32 of Resolution
No. 10717 provides:

Omnibus Election Code, Section 76:

Sec. 76. Ministerial duty of receiving and acknowledging receipt. — The Commission,
provincial election supervisor, election registrar or officer designated by the Commission or
the board of election inspectors under the succeeding section shall have the ministerial duty
to receive and acknowledge receipt of the certificate of candidacy.

COMELEC Resolution No. 10717, Section 32:

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Section 32. Ministerial Duty of Receiving and Acknowledging Receipt of Certificates of

Candidacy/Nomination and Acceptance. — The Receiving Officer has the ministerial duty to
receive and acknowledge the receipt of the COC and CONA; Provided that they are filed in
conformity with the rules and regulations.

Based thereon, the COMELEC must receive COCs and CONAs provided they are filed in conformity
with the rules and regulations. Thus, the Court agree with the COMELEC when it asserted that up to the point
when it received Ayson's COC and CONA (which it accorded with the presumption of regularity for having
been notarized), it merely performed its ministerial function under the foregoing provisions. A ministerial act
is one which an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to
the mandate of legal authority, without regard to or the exercise of his or her own judgment upon the propriety
or impropriety of the act done. To repeat, because Ayson's COC and CONA appeared to be regular on their
face, the COMELEC had no recourse but to accept them.

But following the acceptance of Ayson's COC and CONA, supervening events took place which
necessarily called for the COMELEC's exercise of its discretionary power vis-à-vis the performance of its quasi-
judicial functions, viz.: Senator Lacson, Chairperson of Partido Reporma, disclaimed the CONA allegedly
issued by Partido Reporma to Ayson; and he sought the COMELEC's "immediate action" and requested that
"the necessary correction/s be made in the [COMELEC's] Certified List of Candidates." In fine, Senator
Lacson was seeking a resolution of a controversy which affected the candidacy of Ayson and Navarro, and
subsequently, Aggabao.

As astutely observed by Associate Justice Alfredo Benjamin S. Caguioa (Justice Caguioa) during the
Court’s deliberation, when Senator Lacson sent his letters to the COMELEC challenging the validity or
authenticity of the CONA of Ayson, a legal controversy had then come to fore, i.e., which of the respective
CONAs of Ayson and Navarro should prevail? To be sure, this legal controversy required the COMELEC to
look beyond the face of these CONAs. On this score, Section 2 of Article IX-C of the 1987 Constitution
empowers the COMELEC to exercise jurisdiction over all contests relating to the elections, returns and
qualifications of all elective officials, and to decide all questions affecting elections. It is mandated to "investigate
and, where appropriate, prosecute cases of violations of elections laws, including acts or omissions constituting
election frauds, offenses and malpractices." Thus, even after its acceptance of Ayson's CONA, which initially
appeared to be regular, the COMELEC became duty bound to take cognizance of, and investigate, the material
information coming from Senator Lacson that Partido Reporma had not issued any CONA in favor of Ayson.

In this regard, where the situation calls for the power of the COMELEC to exercise its judgment or
discretion involving a determination of fact, or resolution of controversies where parties adduce evidence in
support of their contentious, the COMELEC ought to perform its quasi-judicial functions.

Again, as correctly pointed out by Justice Caguioa, the COMELEC En Banc had, in several instances,
referred matters to its Divisions for hearing. The COMELEC, therefore, should have similarly referred the
administrative matter in this case to a Division and docketed the same as an election case, heard the parties
thereon, and thereafter resolved the material issue as to who between Ayson and Navarro, and subsequently
Aggabao was the real mayoralty candidate of Partido Reporma. That the COMELEC rules may be silent on
how these conflicting CONA’S and the disavowals of the concerned political party may be resolved did not

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justify its inaction. All it needed to do was adhere to the due process requisites of notice and hearing attendant
to every adjudication it does in the exercise of its quasi-judicial functions.

In Engle v. COMELEC, the Court held that in the exercise of its quasi-judicial functions, the
COMELEC is mandated to hear and decide cases first by Division and, on motion for reconsideration, by the
COMELEC En Banc. The Court further stressed that the opinion of the COMELEC Law Department is not
binding and at most, is merely recommendatory. The COMELEC En Banc cannot short cut proceedings by
acting without prior action by a Division because this deprives the candidate of due process.

(3) YES. COMELEC acted with grave abuse of discretion.

Grave abuse of discretion is defined as arbitrary or despotic exercise of power due to passion, prejudice,
or personal hostility; or the whimsical, arbitrary, or capricious exercise of power that amounts to an evasion or
refusal to perform a positive duty enjoined by law or to act at all in contemplation of law.

Going by the undisputed facts, the COMELEC effectively aided the winning mayoralty candidate by
refusing to resolve the respective status of Ayson and Navarro, and later on of Aggabao, as candidates. It opted
to rely solely on the recommendation of its Law Department, sans the benefit of its own independent
confirmation which could have been done by referring the case to the COMELEC Division for a summary
hearing. Had the COMELEC performed its adjudicative duty required under the Constitution and the law,
Ayson or Aggabao could have given the winning candidate a run for her money. But as things turned out, both
were denied the opportunity to run as the official mayoralty candidate of Partido Reporma.

The Court once more agrees with the keen observation of Justice Caguioa that because the COMELEC
failed to exercise its quasi-judicial functions, conduct hearings, weigh evidence, and draw conclusions
therefrom, let alone, resolve once and for all the issue of party endorsement or representation between Ayson
and Aggabao, the Court itself in this certiorari proceeding cannot do either one or the other. The Court is not a
trier of facts. Nor can it draw conclusions or resolve the issue of party endorsement or representation where
the facts had not been established on record before the COMELEC at the first instance. Therefore, the lack of
hearing precludes the Court from resolving who between Ayson and Aggabao was the real official candidate of
Partido Reporma.

But as for the assailed Document No. 21-3973 dated November 10, 2021, declaring Navarro as an
independent candidate; (b) Document No. 21-7467 dated December 22, 2021, denying Aggabao's Certificate
of Candidacy (COC) as substitute candidate for petitioner Navarro; and (c) Document No. 222-0176 dated
January 5, 2022, denying Aggabao's motion for reconsideration, the Court nullifies and sets them aside for non-
compliance with the due process requirements as discussed above.

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DENNIS M. VILLA-IGNACIO v. WENDELL E. BARRERAS-SULIT

G.R. No. 222469, 21 September 2022, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The Court emphasize that the disciplinary authority of the Ombudsman proceeds from a constitutional imprimatur. It is
not a mere statutory power. For even without Sections 15, 19, or 21 of the Ombudsman Act, the Ombudsman is empowered no
less by the Constitution to investigate and discipline all public officers and employees, save only impeachable officers and the officials
and employees of the Judiciary and each of the Constitutional Commissions. The Special Prosecutor became the subordinate of the
Ombudsman with a mandate to continue to be the prosecuting arm of the Ombudsman under Presidential Decree 1630 or the
Tanodbayan Decree. In doing so, the Office of the Special Prosecutor is subject to the Ombudsman's disciplining authority. The
Court cannot erode the independence of the Ombudsman by not allowing the latter to remove the Special Prosecutor.

In view of the foregoing considerations, the IAB and the Offices of the Ombudsman and her Deputies here exercised the
powers which properly belong to them, i.e., the power to investigate the complaints filed against the Special Prosecutor and impose
disciplinary sanctions on him, if proper.

FACTS
Under an anonymous letter, "supposed concerned employees" complained that Dennis M. Villa-
Ignacio (Ignacio) failed to report to work on various dates and had a penchant for leaving work early. The letter
cited the entries in the Security Logbooks of the dates and times when Ignacio entered and left his place of
work. In another complaint, Assistant Special Prosecutor Rabendranath T. Uy (Uy) charged Ignacio with
dishonesty, falsification of public documents, estafa, and violation of Section 3 (e) of Republic Act No. 3019
(R.A. No. 3019), or the "Anti-Graft and Corrupt Practices Act," for his supposed habitual and unauthorized
absences and submission of falsified Certificates of Service from January 2008 to July 2008.

In yet another complaint, Wendell E. Barreras-Sulit (Sulit) charged Ignacio before the Internal Affairs
Board (IAB) of the Office of the Ombudsman (OMB) with violations of Articles 171 and 174 of the Revised
Penal Code; serious dishonesty, grave misconduct, conduct prejudicial to the best interest of the service,
frequent unauthorized absences/habitual absenteeism under the Uniform Rules on Administrative Cases in the
Civil Service; and violation of Section 3 (e) of R.A. No. 3019.

In the first two complaints, the IAB dismissed the charges for lack of probable cause. Moreover, it
ruled that the logbook entries were not sufficient, nor accurate evidence of absences, tardiness, or under times
allegedly incurred by Ignacio. Too, by the nature of Ignacio's office and functions, there were times he was
necessarily impelled to perform his official duties outside the office.

For the third complaint, Sulit averred that Ignacio falsified his certificates of service from August 2008
to December 2008. As indicated in these certificates, he rendered full-time service during the covered period,
except for the indicated 36 days when he took a leave of absence. In truth, according to the complaint, he was
actually absent for 64 days from August 2008 to December 2008, or an absence of 28 days without approved
leave.

In response, Ignacio argued that the entries in the logbook or Information Report of the Office of
Special Prosecutor (OSP) security guards were inaccurate and unreliable since they were not notarized nor
written by public officers in their official capacities. He also averred that the service of the Order to him was

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irregular, unfair, and impelled by sinister motives as it effectively required him to prepare his pleadings and
evidence during the holidays, thus, amounting to a denial of due process. Finally, he maintains that the IAB
had no jurisdiction over him as the OSP was directly under the control and supervision of the Office of the
President (OP) pursuant to Section 8 of Republic Act No. 6770 (R.A. No. 6770) or the Ombudsman Act.

The IAB found Ignacio guilty of the offenses charged in the third complaint. It ordered his dismissal
from the service.

On appeal, the Court of Appeals (CA) affirmed the IAB ruling. It argued that the power of the
Ombudsman to remove any erring public official from the service is set forth under Section 15, R.A. No. 6770.
On this score, the Office of the Ombudsman has the power to promulgate its own rules of procedure for the
effective exercise of its powers, functions, and duties.

ISSUES
(1) Does the Ombudsman have disciplinary power over the Special Prosecutor?
(2) Was Villa-Ignacio denied his right to due process of law during the IAB proceedings?
(3) Is Villa-Ignacio administratively liable for the alleged falsification of his certificates of service?

RULING
(1) YES. The Ombudsman has the power to remove the Special Prosecutor.

Suffice it to state at this time that the Ombudsman has the power to remove the Special Prosecutor.
This is found both in the Constitution and R.A. No. 6770. The Office of the Ombudsman is constitutionally
envisioned to be an independent agency. This has been affirmed in Gonzales III v. Office of the President (Gonzales
2012), and the Resolution dated January 28, 2014, in the same case (Gonzales 2014). The authority of the Office
of the Ombudsman to conduct administrative investigations proceeds from its constitutional mandate to be an
effective protector of the people against inept and corrupt government officers and employees. This power
looms over the Office of the Special Prosecutor, as well.

The extent of its power [Ombudsman] is circumscribed in Section 21 of R.A. No. 6770:

Section 21. Official Subject to Disciplinary Authority; Exceptions. — The Office of the Ombudsman
shall have disciplinary authority over all elective and appointive officials of the Government
and its subdivisions, instrumentalities and agencies, including Members of the Cabinet, local
government, government-owned or controlled corporations and their subsidiaries, except over
officials who may be removed only by impeachment or over Members of Congress, and the
Judiciary.

Insofar as administrative investigations affecting the Ombudsman Deputies and the Special
Prosecutor, however, Section 8 (2) of R.A. No. 6770 states:

Section 8. Removal; Filling of Vacancy. —

(2) A Deputy or the Special Prosecutor, may be removed from office by the President for any
of the grounds provided for the removal of the Ombudsman, and after due process.

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Ultimately, the Court [in Gonzales 2012] sustained the constitutionality of Section 8 (2), R.A. 6770 for
the following reasons:

(a) First, in an effort to harmonize the provisions of Section 8 (2) and Section 21 of R.A. 6770, the
Court ruled that the Ombudsman and the President exercise concurrent disciplinary jurisdiction
over a Deputy Ombudsman and the Special Prosecutor. This sharing of authority goes into the
wisdom of the legislature, hence, beyond judicial inquiry.
(b) Second, by granting express statutory power to the President to remove a Deputy Ombudsman
and the Special Prosecutor, the Legislature merely filled an obvious gap in the law: the Constitution
provides the avenue and grounds for the removal of the Ombudsman, but not a Deputy
Ombudsman and the Special Prosecutor.
(c) Third, the power of the President to remove a Deputy Ombudsman and the Special Prosecutor is
implied from his or her power to appoint them.
(d) Finally, granting the President the power to remove a Deputy Ombudsman and the Special
Prosecutor does not diminish the independence of the Office of the Ombudsman.

While Gonzales 2014 upheld the power of the President to remove the Special Prosecutor, it did not
rule that the Office of the Ombudsman lacked such power. The Court emphasizes that the disciplinary authority
of the Ombudsman proceeds from a constitutional imprimatur. It is not a mere statutory power. For even
without Sections 15, 19, or 21 of the Ombudsman Act, the Ombudsman is empowered no less by the
Constitution to investigate and discipline all public officers and employees, save only impeachable officers and
the officials and employees of the Judiciary and each of the Constitutional Commissions.

The Special Prosecutor became the subordinate of the Ombudsman with a mandate to continue to be
the prosecuting arm of the Ombudsman under Presidential Decree 1630 or the Tanodbayan Decree. In doing
so, the Office of the Special Prosecutor is subject to the Ombudsman's disciplining authority. The Court cannot
erode the independence of the Ombudsman by not allowing the latter to remove the Special Prosecutor. Indeed,
for purposes of emphasizing the Ombudsman's power to remove the Special Prosecutor, the Court say that
the Special Prosecutor has the same rank and salary as a Deputy Ombudsman over whom the Ombudsman
has the sole power to remove. With more reason must the Special Prosecutor enjoy the same level of
independence as the Ombudsman and the Deputies — to insulate the Special Prosecutor's prosecutorial
discretion every step of the way institutionally and in individual cases.

In view of the foregoing considerations, the IAB and the Offices of the Ombudsman and her Deputies
here exercised the powers which properly belong to them, i.e., the power to investigate the complaints filed
against the Special Prosecutor and impose disciplinary sanctions on him, if proper.

Section 11 of R.A. 6770 unmistakably supports the authority exercised by the Ombudsman. It vests
the Ombudsman with the power of supervision and control over the Special Prosecutor in order to aid the
mandate of the Office of the Ombudsman in the discharge of its powers and functions, principally in the
conduct of preliminary investigation and prosecution of criminal cases within the jurisdiction of the
Sandiganbayan. Thus, the meaning of "supervision and control" under Section 11 (3) of R.A. 6770 does not
only refer to the prosecutorial powers of the Special Prosecutor but also to the exercise of disciplinary authority
over the Special Prosecutor.

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(2) NO. Ignacio was not denied his constitutional right to due process of law.

In administrative proceedings, due process is satisfied when persons are notified of the charge against
them and given an opportunity to explain or defend themselves. In such proceedings, notice and hearing
afforded to these persons constitute the minimum requirements of due process. The essence of due process,
therefore, as applied to administrative proceedings, is an opportunity to explain one's side, or an opportunity
to seek a reconsideration of the action or ruling complained of. Thus, a violation of that right occurs when a
court or tribunal rules against a party without giving the person the opportunity to be heard.

Admittedly here, Ignacio was granted an extension of time to file a counter-affidavit. Thereafter, he
duly filed a Joint Counter-Affidavit Ex Abundanti Ad Cautelam. When he received the IAB ruling, he also filed
a motion for reconsideration. Verily, Ignacio cannot claim denial of due process. More, the supposed
unreasonable service of the IAB Order before the holidays was negated by the approval of Ignacio's request
for an extension of 15 days.

In any event, the observance of fairness in the conduct of any investigation is at the very heart of the
procedural due process. Administrative due process does not require due process in its strict judicial sense.
Administrative hearings are not done with a trial-type hearing; technical rules of procedure are not even strictly
applied. Here, Ignacio actively participated in the entire course of the investigation conducted. Assisted by
counsel, he filed numerous pleadings in defense of his position. He was given every opportunity to be heard,
including the grant of extension to file pleadings. He filed an appeal before the CA and the Supreme Court.
Denial of due process cannot be successfully invoked by a party who was in fact afforded the opportunity to
be heard and took part in it.

(3) NO. there is simply no substantial evidence to find Ignacio liable — he must be exonerated.

The factual findings of the Office of the Ombudsman are generally accorded great weight and respect,
if not finality, by the courts because of their special knowledge and expertise over matters falling under their
jurisdiction. When supported by substantial evidence, its findings of fact are deemed conclusive. In
administrative proceedings, the quantum of proof necessary for a finding of guilt is substantial evidence or such
relevant evidence as a reasonable mind may accept as adequate to support a conclusion. Well- entrenched is
the rule that substantial proof, and not clear and convincing evidence or proof beyond reasonable doubt, is
sufficient as basis for the imposition of any disciplinary action upon the employee.

Here, The Information Report is not a reliable source of attendance. This has already been pointed out
by the Office of the Ombudsman itself.

In the Fact-Finding Investigation Report, the IAB then headed by its Chairperson and Deputy
Ombudsman Mosquera dismissed the first complaint, citing the following reasons:
Likewise, entries in the logbooks only establish the fact that a particular official or employee
went inside or outside his/her workplace but not the fact that he/she actually reported for work or
was just in the premises for a visit or some other unofficial business.

On the other hand, in the Consolidated Resolution, the IAB dismissed the second complaint for
Falsification of Public Documents, Estafa, and Violation of Section 3 (e), R.A. 3019, viz:

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The sole basis for the alleged unauthorized absences of Ignacio is the Information Report of
the security guards culled from the entries in their logbook. However, said logbook entries, by
themselves, are not a reliable source for determining Ignacio's attendance and cannot be utilized as the
sole evidence or proof of such because the same may be inaccurate or incomplete.

Thus, contrary to the Decision of the IAB over the third complaint, as approved by the Ombudsman
and her deputies, the Information Report that was used to track Ignacio's attendance in the office is not a
reliable, accurate, or complete source for determining Ignacio's attendance and rendition of service. At the
most, it only established the fact that a particular official or employee went inside or outside his/her workplace
but not the fact that he or she actually reported for work or was just on the premises for a visit or some other
unofficial business.

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QUEZON CITY EYE CENTER v. PHILIPPINE HEALTH INSURANCE CORPORATION, et

al.
G.R. Nos. 246710-15, 06 February 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In Cayago v. Lina, the Court ruled that due process is satisfied when a person is notified of the charge against him and
given an opportunity to explain or defend himself. In administrative proceedings, the filing of charges and giving reasonable
opportunity for the person so charged to answer the accusations against him constitute the minimum requirements of due process.

Here, PhilHealth violated Quezon City Eye Center's right to due process when it did not furnish the latter a copy of the
resolution finding a prima facie case against it. Admittedly, Quezon City Eye Center was given a reasonable opportunity to file its
answers to the various complaints filed by the FFIED with the PhilHealth Prosecution Department. However, the due process
problem arose when the PhilHealth Prosecution Department simply disregarded its own procedural rules when it proceeded to file
the Complaints before the PhilHealth Arbitration Office, sans any resolution finding a prima facie case against Quezon City Eye
Center.

FACTS
Philippine Health Insurance Corporation (PhilHealth) issued Circular No. 17, series of 2007, directing
the suspension of PhilHealth claims for cataract operations performed during medical missions and through
other recruitment schemes for cataract surgeries.

Subsequently, a group of doctors alleged that certain doctors were involved in "cataract sweeping" and
recruitment. Thus, PhilHealth directed its Fact Finding Investigation and Enforcement Department (FFIED)
to investigate the top five ophthalmologists with the highest utilization rate in cataract services.

Accordingly, the investigation showed that Dr. Allan M. Valdez (Dr. Valdez) and Dr. Rhoumel A.
Yadao (Dr. Yadao) were among those involved in the so called "cataract sweeping" or recruitment activities.
Hence, six administrative cases were filed against Quezon City Eye Center where the two aforenamed doctors
performed cataract surgeries on their patients.

Quezon City Eye Center was given an opportunity to file its answers to the various complaints filed
by the FFIED with the PhilHealth Prosecution Department. However, the PhilHealth Prosecution Department
proceeded to file the Complaints before the PhilHealth Arbitration Office, even if there is no resolution finding
a prima facie case against Quezon City Eye Center.

Quezon City Eye Center filed Petitions for Certiorari before the Court of Appeals (CA). However, the
CA dismissed the same. It ruled that Quezon City Eye Center was afforded due process.

ISSUE
Did PhilHealth violate Quezon City Eye Center’s right to due process?

RULING
YES. In Cayago v. Lina, the Court ruled that due process is satisfied when a person is notified of the
charge against him and given an opportunity to explain or defend himself. In administrative proceedings, the

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filing of charges and giving reasonable opportunity for the person so charged to answer the accusations against
him constitute the minimum requirements of due process.

Here, Quezon City Eye Center was admittedly given a reasonable opportunity to file its answers to the
various complaints filed by the FFIED with the PhilHealth Prosecution Department. However, the due process
problem arose when the PhilHealth Prosecution Department simply disregarded its own procedural rules when
it proceeded to file the Complaints before the PhilHealth Arbitration Office, sans any resolution finding a prima
facie case against Quezon City Eye Center.

Accordingly, Section 88 of the 2013 Revised IRR ordains:

SECTION 88. Finding of a Prima Facie Case .

If from an evaluation of the affidavit-complaint, answer and other evidence attached thereto,
the investigating prosecutor finds a prima facie case against the respondent health care
provider/ member, the investigating prosecutor shall submit the resolution together with the
formal complaint for the approval of the Senior Vice-President for Legal Sector (SVP-LS)
within thirty (30) days from receipt of the answer or from the expiration of the period to file
the same.

The above provision uses the word "shall" which imposes a duty. In Diokno v. Rehabilitation Finance
Corporation, the Court ruled that the presumption is that the word "shall" in a statute is used is an imperative,
and not in a directory, sense.

Further, Section 90 of the 2013 IRR states that the resolution of the prosecutor duly approved by the
SVP-LS shall be final and cannot be a subject of a motion for reconsideration. Section 90 expressly speaks of
the finality of the resolution and the prohibition against a motion for reconsideration or similar pleading to
assail this resolution. Consequently, PhilHealth could not claim that the 2013 IRR did not intend to furnish the
health care provider or facility with a copy of the resolution of the prosecutor that was submitted for approval
by the SVP-LS of PhilHealth.

The reason is that petitioner or any party similarly situated is entitled to know the case it has to meet.
This information is found in the prosecutor's resolution that contains the evaluation, discussion, and analysis
of the allegations in the complaint-affidavit, the defense of the health care provider or facility in its answer, and
the evidence presented by both complainant and health care provider or facility. This resolution gives the
reasons for the prosecutor's determination of a prima facie case. The health care provider or facility will be unable
to meet its case if it has no copy of the prosecutor's resolution. Accordingly, due process dictates that the health
care provider or facility must be furnished a copy of the resolution of the prosecutor.

Here, PhilHealth violated Quezon City Eye Center 's right to due process when it did not furnish the
latter a copy of the resolution finding a prima facie case against it. Another, the Court ruled that PhilHealth must
ensure that there are full arms-length dealings between its prosecuting office and PhilHealth itself as reviewer
of the prosecutor's finding of a prima facie case. This too is part and parcel of due process. These bodies must be
separate from and independent of each other. The Court explained that we cannot afford to have just a single
body becoming the judge, prosecutor, and executioner all at the same time.

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POLICE OFFICER 2 ARTHUR M. PINEDA v. PEOPLE OF THE PHILIPPINES

G.R. No. 228232, 27 March 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Verily, it is fundamental that every element of the offense charged must be alleged in the complaint or information. For
the accused is presumed to have no independent knowledge of the facts that constitute the offense. The main purpose of requiring the
various elements of a crime to be set out in an information is to enable the accused to suitably prepare his or her defense. It is of no
moment how conclusive and convincing the evidence of guilt may be, but an accused cannot be convicted of any offense unless it is
charged in the complaint or information on which he or she is tried or is necessarily included therein.

In sum, PO2 Pineda was not charged with either Conniving with/Consenting to Evasion under Article 223 of the
Revised Penal Code nor with Evasion through Negligence under Article 224 of the Revised Penal Code. The allegations in the
Information were neither here nor there. It was even replete with contradictions. Consequently, PO2 Pineda cannot be found guilty
of either one of the aforesaid crimes. To do so would certainly violate his Constitutional right to be informed of the nature and cause
of the accusation against him.

FACTS
Alicia Go Tan (Tan) was the head nurse of the Metropolitan Medical Center (hospital). Patient
Marcelino Nicolas (Nicolas) had been admitted and confined under hospital arrest for two weeks already when
the incident happened. The police officers were posted outside his room, guarding him round the clock by
shift. Though Nicolas was stable, he was still in a critical stage and needed supervision. He had never been
handcuffed.

Tan removed the intravenous line attached to Nicolas per his request via buzzer and per the instruction
of the doctor. Tan then went to the pharmacy of the hospital to request a new intravenous set. Upon her return,
she discovered that Nicolas, who was charged with the murder of one Roberto Co, had absconded. Tan
reported his escape to her superior and supervisor, and to the Security Office, through Officer-in-Charge
Joemar Boquiren (SO Boquiren).

SO Boquiren immediately proceeded to the room occupied by Nicolas. Tan, together with two others,
signed an Incident Report and submitted the same to the Medical Director's Office. Tan did not see PO2
Arthur M. Pineda (PO2 Pineda) in his post between 12:00 noon to 1:00 p.m. of even date. PO2 Pineda also left
his post for two hours and 30 minutes. Tan did not see PO2 Pineda return to the hospital either after Nicolas
escaped.

PO2 Pineda said that he went on a lunch break during the incident. He then went outside the hospital
where he was approached by two barangay tanods and Punong Barangay Susan Duanan (Punong Barangay Duanan)
to seek his assistance with regard to a snatching/robbery incident. He searched for possible places where the
robber escaped and was unable to call for back-up since he did not have a radio or any means of communication
at the time. He rendered police assistance until 2:00 p.m.

The Metropolitan Trial Court (MeTC) found PO2 Pineda guilty of Conniving with or Consenting to
Evasion. However, the Regional Trial Court (RTC) affirmed PO2 Pineda's conviction, albeit for another crime
- Evasion through Negligence. The Court of Appeals affirmed the ruling of the RTC.

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ISSUE
Was PO2 Pineda duly informed of the nature and cause of the accusation against him for which he was
found guilty of?

RULING
NO. Section 14(2), Article III of the 1987 Constitution guarantees the right of the accused in all criminal
prosecutions to be informed of the nature and cause of the accusation against him or her.

In People v. Bayya, the Court explained the purpose of this provision, to wit:

The purpose of the above-quoted rule is to inform the accused of the nature and cause of the
accusation against him [or her], a right guaranteed by no less than the fundamental law of the land.
Elaborating on the defendant's right to be informed, the Court held in Pecha v. People that the objectives
of this right are:

(a) To furnish the accused with such a description of the charge against him [or her]
as will enable him to make the defense;
(b) To avail himself [or herself] of his conviction or acquittal for protection against a
further prosecution for the same cause; and
(c) To inform the court of the facts alleged, so that it may decide whether they are
sufficient in law to support a conviction, if one should be had.

It is thus imperative that the Information filed with the trial court be complete - to the end
that the accused may suitably prepare his defense. Corollary to this, an indictment must fully state the
elements of the specific offense alleged to have been committed as it is the recital of the essentials of
a crime which delineates the nature and cause of accusation against the accused.

Verily, it is fundamental that every element of the offense charged must be alleged in the complaint or
information. For the accused is presumed to have no independent knowledge of the facts that constitute the
offense. The main purpose of requiring the various elements of a crime to be set out in an Information is to
enable the accused to suitably prepare his or her defense. It is of no moment how conclusive and convincing
the evidence of guilt may be, but an accused cannot be convicted of any offense unless it is charged in the
complaint or information on which he or she is tried or is necessarily included therein.

Here, the offense of Conniving with/Consenting to Evasion under Article 223 of the Revised Penal Code
bears the following elements:

(a) the offender is a public officer;

(b) he or she had in his or her custody or charge either a detention prisoner or prisoner by
final judgment;
(c) such prisoner escaped from his or her custody; and
(d) he or she consented to the evasion or was in connivance with the prisoner in the latter's
escape.

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We focus on the fourth element. It pertains to the manner by which the offense was committed by the
accused, i.e., he or she consented to the evasion or was in connivance with the prisoner in the latter's escape.
As it was, this element was conspicuously absent in the subject Information which alleged that the crime was
committed willfully, unlawfully, feloniously, and with grave abuse and infidelity.

Grave abuse and infidelity, however, do not equate to consent or connivance as required under Article
223. While grave abuse and infidelity suggest willful and deliberate intent by the accused to commit the crime,
a form of assent from the accused to the prisoner's plan to abscond is further required.

As for Evasion through Negligence under Article 224 of the Revised Penal Code, the following elements
must be present:

(a) the offender is a public officer;

(b) he or she is charged with the conveyance or custody of either a detention prisoner or
prisoner by final judgment;
(c) such prisoner escaped from his or her custody; and
(d) due to his or her negligence.

Again, we focus on the fourth element i.e., negligence. We refer back to the allegation in the
Information that the accused "did then and there willfully, unlawfully, feloniously and with grave abuse and
infidelity, cause the escape of the said accused, by then and there leaving his place of assignment at the hospital
from 11:15 a.m. (1115H) to 2:35 p.m. (1435H) per Log Book of Security Guards on duty (Randy M. Serra arid
Lino M. Lapizar), thereby giving opportunity to said accused to escape."

The allegation is self-explanatory. It is devoid of the requisite element of negligence. The allegation in
fact speaks of the opposite of negligence such as "willfully, unlawfully, feloniously and with grave abuse and
infidelity." More, the Information is captioned Violation of Article 223 of the Revised Penal Code.

In sum, PO2 Pineda was not charged with either Conniving with/Consenting to Evasion under Article
223 of the Revised Penal Code nor with Evasion through Negligence under Article 224 of the Revised Penal Code.
The allegations in the Information were neither here nor there. It was even replete with contradictions.
Consequently, PO2 Pineda cannot be found guilty of either one of the aforesaid crimes. To do so would
certainly violate his Constitutional right to be informed of the nature and cause of the accusation against him.

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ILOILO GRAIN COMPLEX CORPORATION v. MA. THERESA N. ENRIQUEZ-GASPAR, in

her capacity as Presiding Judge of RTC-Iloilo City, Branch 33, and NATIONAL GRID
CORPORATION OF THE PHILIPPINES
G.R. No. 265153, 12 April 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In the hands of government agencies, local governments, public utilities, and other persons and entities, the right to
expropriate is not inherent and is only a delegated power.

As clearly indicated, NGCP's right to eminent domain, being a mere delegated power, is subject to several restrictions:

(a) it must conform to limitations prescribed by law; and

(b) it must be exercised in accordance with the proper procedure for expropriation.

NGCP must exercise its delegated power of expropriation in strict compliance with these conditions. For it is settled that
the right of eminent domain, not being an inherent, but a mere delegated power of NGCP, its right to expropriate is restrictively
limited to the confines of the delegating law. The scope of its delegated power is thus necessarily narrower than that of the delegating
authority.

Here, the RTC committed grave abuse of discretion amounting to lack or excess of jurisdiction when it issued the writ of
possession without first determining whether NGCP had in fact complied with the requirements of the law for a valid exercise of
its delegated power to expropriate, among them, the existence of a genuine necessity for the taking of the subject property, compliance
with the required ERC approval for the project, and compliance with the requirement that the expropriation and the manner by
which it was sought to be implemented was least burdensome to the landowner.

FACTS
Iloilo Grain Complex Corporation (IGCC) was a private corporation registered under the laws of the
Philippines, engaged agriculture business. National Grid Corporation of the Philippines (NGCP) was also a
private corporation registered under the laws of the Philippines and a holder of a national franchise to operate
and maintain the transmission assets and facilities of the National Transmission Corporation (TransCo) under
Republic Act (R.A.) No. 9511.

NGCP offered to buy a parcel of land of IGCC's industrial property at P1,075.00 per square meter
(sq.m.) for the construction of its Ingore Cable Terminal Station and Panay-Guimaras 138kV Transmission
Line Project. IGCC informed NGCP that the current fair market value of the property was already
PHP10,000.00 per sq.m.

NGCP then relayed to IGCC its desire to expropriate the property, albeit it made a last offer of
P5,000.00 per sq. m. equivalent to the residential zonal value of the property. Later, NGCP filed its Complaint
for expropriation with urgent prayer for issuance of writ of possession before the Regional Trial Court (RTC).

The RTC ordered the issuance of a writ of possession without hearing. It denied IGCC's affirmative
defenses, and its subsequent Motion for Reconsideration (MR) and Motion to Stay writ of possession.

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Accordingly, IGCC filed directly with the Court the present Petition for Certiorari and Prohibition with
Application for temporary restraining order (TRO) and/or Writ of Preliminary Injunction.

IGCC also asserted that the trial court committed grave abuse of discretion when it ordered the
issuance of the assailed writ of possession. It argued that the expropriation must be made in compliance with
pre-requisites set by law like Section 9(d) of R.A. No. 9136 or the Electric Power Industry Reform Act of 2001
(EPIRA), which required prior approval by the ERC of any plan for expansion or improvement of the facilities
of the TransCo. In addition, the line path chosen by NGCP for its project was not reasonably necessary since
there was an alternative straight-line path from NGCP's substation to the public highway which was shorter
than NGCP's chosen line path.

ISSUE
Did the trial court commit grave abuse of discretion when it issued the assailed writ of possession?

RULING
YES. The right of persons to life, liberty, or property is constitutionally protected. No one can be
deprived of the same without due process of law. For this reason, Section 9, Article III of the Constitution
limits the inherent power of the State itself in the taking of private property.

The power of eminent domain is defined as the right of the government to take and appropriate private
property for public use, whenever the public exigency requires it, which can be done only on condition of
providing reasonable compensation therefor. It is inseparable from sovereignty and inherent in the State. It is
primarily lodged with Congress as the legislative branch of the government. Congress may delegate the exercise
of the power of eminent domain to local government units, other public entities, and public utility corporations,
subject only to Constitutional limitations.

Accordingly, In the hands of government agencies, local governments, public utilities, and other
persons and entities, the right to expropriate is not inherent and is only a delegated power. On this score, it is
undisputed that R.A. No. 9511 granted NGCP the right to eminent domain.

As clearly indicated, NGCP's right to eminent domain, being a mere delegated power, is subject to
several restrictions:

(a) it must conform to limitations prescribed by law; and

(b) it must be exercised in accordance with the proper procedure for expropriation.

NGCP must exercise its delegated power of expropriation in strict compliance with these conditions.
For it is settled that the right of eminent domain, not being an inherent, but a mere delegated power of NGCP,
its right to expropriate is restrictively limited to the confines of the delegating law. The scope of its delegated
power is thus necessarily narrower than that of the delegating authority.

Here, the RTC committed grave abuse of discretion amounting to lack or excess of jurisdiction when
it issued the writ of possession without first determining whether NGCP had in fact complied with the
requirements of the law for a valid exercise of its delegated power to expropriate, among them, the existence
of a genuine necessity for the taking of the subject property, compliance with the required ERC approval for

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the project, and compliance with the requirement that the expropriation and the manner by which it was sought
to be implemented was least burdensome to the landowner.

Under Rule 67 of the Rules of Court (ROC), the exercise of the power of eminent domain has two
stages:
(a) the determination of the authority of the plaintiff to exercise the power of eminent domain and the
propriety of its exercise in the context of the surrounding facts; and
(b) the taking of the land by the State or its agency subject to payment of just compensation.

The first stage ends, if not in a dismissal of the action, with an order of condemnation declaring that
the plaintiff has a lawful right to take the property sought to be condemned, for public use.

The State or its agents may not proceed to the second part without complying with the first. Genuine
necessity is a condition sine qua non to the taking of one's private property. When a question thus arises on
whether the entity exercising the right to expropriate does so in conformity with its delegating law, the same
should be heard and determined by the court pursuant to its vested authority.

Here, the trial court never heard the issue of necessity incipiently raised by IGCC in relation to the
alleged absence of the required ERC clearance, lack of a genuine negotiation in good faith on the part of NGCP,
and lack of any showing that the choice of the subject property was the least burdensome to the landowner.

Accordingly, OCA Circular No. 113-2019, as reiterated by OCA Circular No. 68-2022 cites the case of
Municipality of Cordova v. Pathfinder Development Corporation, as basis for directing lower courts to immediately issue
a writ of possession in expropriation cases once the following twin requisites are satisfied:
(a) sufficiency of the complaint in form and substance; and
(b) the required provisional deposit.

To be deemed sufficient in substance, a complaint for expropriation must clearly set forth the following
requisites for the valid exercise of eminent domain:

(a) the property taken must be private property;

(b) there must be genuine necessity to take the private property;
(c) the taking must be for public use;
(d) there must be payment of just compensation; and
(e) the taking must comply with due process.

Indubitably, for entities exercising a mere delegated power of expropriation, they must likewise
demonstrate that they do have the authority to exercise such power of expropriation.

On this Score, the Court turned to Section 9(d) of the EPIRA which required ERC's prior approval of
any plan to expand or improve TransCo's facilities now being operated and maintained by NGCP.

Accordingly, before NGCP may expropriate private land for such project, it must first secure prior
approval from the ERC. Lacking this pre-requisite, it cannot be said that a genuine necessity exists for the
taking of Iloilo Grain's land simply because there is yet no approved project for the use of such land.

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Here, NGCP's failure to allege in its complaint that it had secured the requisite ERC approval and that
the expropriation sought, as well as its choice of the portion to be expropriated was the least burdensome to
the landowner rendered the complaint insufficient in substance.

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PROVINCE OF MAGUINDANAO DEL NORTE v. BUREAU OF LOCAL GOVERNMENT

FINANCE, REGIONAL OFFICE NO. XII, et al.
G.R. No. 265373, 26 June 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In Lecaroz v. Sandiganbayan, the Court reiterated the strong presumption against a legislative intent to create a vacuum
in public offices, which is founded on obvious considerations of public policy to avoid a hiatus in the performance of government
functions. The principle of hold over in public offices thus serves to prevent public inconvenience. The rule of hold over applies where
there is no express or implied legislative intent to the contrary. But it cannot be applied if there is such legislative intent.

Here, the intent of Congress is made clear in Section 50. It did not intend in the interim for a vacuum to exist in the
public offices of the newly created Provinces of Maguindanao del Norte and Maguindanao del Sur. Indeed, it would be absurd, nay,
contrary to the intent of Congress and the will of the sovereign constituents of these new provinces, to interpret the law in a manner
which unduly and unreasonably delays its operation and corporate existence.

FACTS
Republic Act No. 11550 (R.A. No. 11550) was signed into law, dividing the province of Maguindanao
into Maguindanao del Norte and Maguindanao del Sur, which would be created upon approval by the majority
of voters in the affected areas in a plebiscite to be conducted and supervised by the Commission on Elections
(COMELEC) within 90 days of the law's effectivity. However, the COMELEC deferred the plebiscite until
after the 2022 National and Local Elections (2022 NLE).

Subsequently, the COMELEC conducted the plebiscite, which resulted in the ratification of R.A. No.
11550. Accordingly, following the structure of Section 50 of R.A. No. 11550, the elected Vice Governor of the
Province of Maguindanao, Fatima Ainee L. Sinsuat (Sinsuat), and the next ranking member of the Sangguniang
Panlalawigan of the same province, Datu Sharifudin Tucao P. Mastura (Mastura), would assume their respective
offices as Governor and Vice-Governor of Maguindanao del Norte.

Later, Sinsuat requested that the Bureau of Local Government Finance (BLGF) Region XII designate
Badorie M. Alonzo (Alonzo) as Provincial Treasurer of Maguindanao del Norte. However, when BLGF XII
sought legal guidance, the BLGF Central Office argued that since the plebiscite occurred only after the 2022
NLE, Section 50 would no longer apply regarding the assumption of office by the supposed governing officials
of the newly created Province of Maguindanao del Norte.

Maguindanao del Norte, represented by Sinsuat, thus filed a Petition for Mandamus to compel BLGF
Region XII, et al., to process the designation of Alonzo or any qualified person designated by Sinsuat as its
Provincial Treasurer.

The Solicitor General maintained that Sinsuat had not established a legal right to compel BLGF to
appoint a provincial treasurer since the transitory provisions of R.A. 11550 would only apply if the law was
ratified at least six months prior to the May 2022 National and Local Elections. Moreover, BLGF is not the
one mandated by law to appoint a provincial treasurer but the Secretary of Finance.

ISSUE

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Was Section 50 of R.A. No. 11550 applicable to the governing officials of the newly created Province
of Maguindanao def Norte?

RULING
YES. Section 50 only expressly provides for two scenarios vis-á-vis the designation or election of
officials of the newly created provinces of Maguindanao del Norte and Maguindanao del Sur depending on the
date when R.A. 11550 is approved and ratified:

(a) The said elective officials shall be elected during the 2022 National and Local Elections if the Act
is approved and ratified within less than six months prior to the said elections; or
(b) The vice-governor and next ranking elective member of the Sangguniang Panlalawigan of the
Province of Maguindanao who are residents of Maguindanao del Norte shall assume as its acting
governor and acting vice-governor, respectively, if the Act is approved and ratified within six
months or more prior to the 2022 National and Local Elections.

As it was, however, none of the two contemplated scenarios took place. Instead, R.A. 11550 was
approved and ratified by an overwhelming majority only during the plebiscite which took place after the 2022
NLE. Notably, the law is silent as regards the filling in of the positions of elective officials for the newly created
provinces under this scenario.

The Court, nonetheless, must render judgment despite the silence, obscurity, or insufficiency of the
law. Here, an indubitable fact remains: the Provinces of Maguindanao del Norte and Maguindanao del Sur have
already ipso facto been created and segregated upon the approval of majority of the voters during the plebiscite.
It is this very operative act which created the provinces.

Albeit the plebiscite was conducted only after the 2022 NLE, this does not invalidate Section 50. As
one of the Transitory Provisions, Section 50 is intended to operate upon the effectivity of the law. Indeed, it
would be in keeping with the spirit and intention of the law to give life to its transitory provisions for we cannot
simply allow the already existing Provinces of Maguindanao del Norte and Maguindanao del Sur to be without
a set of officials or without any funds for their operations.

In Lecaroz v. Sandiganbayan, the Court reiterated the strong presumption against a legislative intent to
create a vacuum in public offices, which is founded on obvious considerations of public policy to avoid a hiatus
in the performance of government functions. The principle of hold over in public offices thus serves to prevent
public inconvenience. The rule of hold over applies where there is no express or implied legislative intent to
the contrary. But it cannot be applied if there is such legislative intent.

Here, the intent of Congress is made clear in Section 50. It did not intend in the interim for a vacuum
to exist in the public offices of the newly created Provinces of Maguindanao del Norte and Maguindanao del
Sur. Indeed, it would be absurd, nay, contrary to the intent of Congress and the will of the sovereign constituents
of these new provinces, to interpret the law in a manner which unduly and unreasonably delays its operation
and corporate existence. Hence, Section 50 was applicable to the governing officials of the newly created
Province of Maguindanao del Norte. Sinsuat and Mastura validly assumed office as governor and vice-governor,
respectively, of the province of Maguindanao del Norte, but only in acting capacities until elections for the
permanent officials to the said positions shall have been held.

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PEOPLE OF THE PHILIPPINES v. ADELBERTO FEDERICO YAP, et al.

G.R. No. 255087, 04 October 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Indeed, in criminal cases, as here, where the life and liberty of the accused is at stake, due process requires that the accused
be informed of the nature and cause of the accusation against him. An accused cannot be convicted of an offense unless it is clearly
charged in the complaint or information. To convict him or her of an offense other than that charged in the complaint or information
would be a violation of this constitutional right. In Evangelista v. People (Evangelista), the Court ruled that constitutionally,
Evangelista had a right to be informed of the nature and cause of the accusation against her. To convict her of an offense other than
that charged in the complaint or Information would be a violation of this constitutional right.

Here, nothing in the Information mentioned the omission of any of the foregoing steps relevant to the status of AsiaBorders
as a qualified bidder and awardee of the Contract. Nor did the Information allege the specific acts by which each of Yap, et al.,
acted in conspiracy in the commission of the crime charged.

FACTS
In preparation for the 12th Association of Southeast Asian Nations (ASEAN) Summit in Cebu, the
Mactan Cebu International Airport Authority (MCIAA) sought to upgrade its firefighting capabilities.
Accordingly, it resolved to purchase one unit of aircraft rescue fire fighting vehicle (ARFFV) through limited
source bidding.

Accordingly, the MCIAA Bids and Awards Committee (BAC) issued a Bulletin stating that the
representative or agent of the manufacturer must be engaged in the supply, delivery, and maintenance of airport
rescue firefighting trucks or airport-related equipment for at least five years. However, later on, this was lowered
to one year.

Later, the BAC declared AsiaBorders, Inc. (AsiaBorders) as the bidder with the lowest calculated and
responsive bid and recommended that the contract be awarded to AsiaBorders for the amount of USD
732,000.00. Acting thereon, MCIAA General Manager Adelberto Federico Yap (Yap) approved the award of
the contract to AsiaBorders.

Under the Contract, the parties agreed that 80% of the costs, fees, and charges relative to obtaining the
letter of credit shall be paid by AsiaBorders while the remaining 20% shall be borne by the MCIAA.
Accordingly, Marlon E. Barillo (Barillo), the President of AsiaBorders requested the remittance of six million
pesos for the opening of a letter of credit. The same was approved by Yap. The same was also signed by the
Manager of the Accounting Division of MCIAA, Ma. Venus B. Casas (Casas).

Accordingly, Yap, Barillo, Casas, et al., were charged with Section 3(e) of Republic Act (R.A.) No. 3019
or the Anti-Graft and Corrupt Practices Act. Yap was also charged with Section 3(g) of R.A. No. 3019. Among
others, the Information provided that there was evident bad faith or gross inexcusable negligence from the
advance partial payment of six million pesos to AsiaBoarders was not a qualified bidder and the vehicle had not
yet been delivered. Accordingly, it was a violation to Section 88 of Presidential Decree (P.D) No. 1445.

The Sandiganbayan (Sandigan) ruled that the prosecution had sufficiently established that Yap, et al.,
were guilty of violating Section 3(e) of R.A. No. 3019 beyond any shadow of doubt. The Sandigan ruled that

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they exhibited manifest partiality, evident bad faith, and gross inexcusable negligence when they caused the
PHP 6 million to be paid to AsiaBorders in advance of the actual delivery, inspection, and acceptance of the
ARFFV.

Further, the Sandigan ruled that there was conspiracy between Yap, et al., to reduce the required years
of relevant experience from five years to one year, sans any justification.

The Sandigan also found Yap guilty of violation of Section 3(g) of R.A. No. 3019. It ruled that the
USD732,000.00 price of the ARFFV was higher than its actual value. There was also a discrepancy between the
Cost, Insurance, and Freight (CIF) value of the ARFFV and the declared value of the ARFFV.

ISSUE
(1) Did Yap, et al., violate Section 3(e) of R.A. No. 3019?
(2) Was AsiaBorders a qualified bidder?
(3) Was the payment of six million pesos representing the government's share in the costs and
expenses for securing the required letter of credit premature?
(4) Was Yap liable for the violation of Section 3(g) of R.A. No. 3019?

RULING
(1) NO. The violation of Section 3(e) of R.A. No. 3019 requires the following elements:
(a) the accused must be a public officer discharging administrative, judicial, or official
functions or a private individual acting in conspiracy with such public officers;
(b) the accused acted with manifest partiality, evident bad faith, or gross inexcusable
negligence; and
(c) the action caused any undue injury to any party, including the government, or gave any
private party unwarranted benefits, advantage, or preference in the discharge of his or her
functions.

For the first element, Yap, et. al., were public officers for the period relevant to the offense charged.
As for Barillo, he was a private individual charged to have acted in conspiracy with Yap, et al., who were all
public officers.

For the second element, the Court cited the case of Uriarte v.People where the Court ruled that Section
3(e) of R.A. No. 3019 may be committed either by dolo, as when the accused acted with evident bad faith or
manifest partiality, or by culpa as when the accused committed gross inexcusable negligence. This is the mental
element of the crime charged - its mens rea. It ranges from recklessness to an intentional mental framework.

Evident bad faith does not simply connote bad judgment or negligence but of having a palpably and
patently fraudulent and dishonest purpose to do moral obliquity or conscious wrongdoing for some perverse
motive or ill will. Manifest partiality, on the other hand, is defined as a clear, notorious, or plain inclination or
predilection to favor one side or person rather than another. While gross inexcusable negligence is defined as
negligence characterized by the want of even the slightest care.

Accordingly, the Court ruled that the element of manifest partiality, evident bad faith, or gross
inexcusable negligence was not present here.

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Here, the Information was not hinged on any supposed defective terms in the Contract for the
procurement of the ARFFV.The Court noted that the validity of the Contract was never assailed in this case;
nor in any separate proceeding. For all intents and purposes, therefore, the Contract was valid in all respects,
including the subject matter, the obligee and the obligor, the reciprocal obligations of the parties and the price
certain or consideration.

Indeed, in criminal cases, as here, where the life and liberty of the accused is at stake, due process
requires that the accused be informed of the nature and cause of the accusation against him. An accused cannot
be convicted of an offense unless it is clearly charged in the complaint or information. To convict him or her
of an offense other than that charged in the complaint or information would be a violation of this constitutional
right.

For the third requisite, the Court ruled that in the absence of the requisite mental element of manifest
partiality, evident bad faith, or gross inexcusable negligence, there can be no resulting undue injury to any party,
specifically to the government. Nor can it be said that the Contract accorded some unwarranted benefit,
advantage, or preference to AsiaBorders, particularly when the number of years of experience required of
participating entities was reduced from five years to one year only.

Here, the member of the BAC explained that the aforesaid modification was due to the apprehension
of the BAC that based on the feedback of interested bidders, the five-year requirement was too strict, and
consequently, majority, if not all, would not be able to muster this requirement. Accordingly, The BAC here
had the authority to modify the eligibility requirements of the bidders. The discretion given to the authorities
on this matter was of such wide latitude that the courts would not interfere therewith, unless it was apparent
that it was issued as a shield to a fraudulent award.

Accordingly, to successfully prosecute the accused under Section 3(e) of Republic Act No. 3019 based
on a violation of procurement laws, the prosecution cannot solely rely on the fact that a violation of
procurement laws has been committed. The prosecution must still prove beyond reasonable doubt that:
(a) the violation of procurement laws caused undue injury to any party, including the government, or
gave any private party unwarranted benefits, advantage or preference; and
(b) the accused acted with evident bad faith, manifest partiality, or gross inexcusable negligence.

As shown, the prosecution failed to muster the requisite quantum of evidence to sustain a verdict of
conviction against Yap, et al., for violation of Section 3(e) of R.A. No. 3019. Hence, a verdict of acquittal was
in order.

(2) YES. In Evangelista v. People (Evangelista), the Court ruled that constitutionally, Evangelista had a right
to be informed of the nature and cause of the accusation against her. To convict her of an offense other than
that charged in the complaint or Information would be a violation of this constitutional right.

Here, nothing in the Information mentioned the omission of any of the foregoing steps relevant to the
status of AsiaBorders as a qualified bidder and awardee of the Contract. Nor did the Information allege the
specific acts by which each of Yap, et al., acted in conspiracy in the commission of the crime charged.

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The Sandiganbayan found reasons to support its factual conclusion that AsiaBorders was not a qualified
bidder. However, the Court keenly noted that these factual conclusions on how Yap, et al., supposedly
performed their individual or collective acts in concert for the purpose of violating Section 3(e) of R.A. No.
3019 were not borne in the Information itself.

This being the case, therefore, the so called not qualified bidder status of AsiaBorders as alleged in the
Information, sans any particulars on how it was so and how each of Yap, et al., unlawfully and wilfully acted
with evident bad faith or gross inexcusable negligence caused the advance payment of P6 million to
Asia.Borders, albeit it was "not a qualified bidder" was deemed not to have been established.

Further, applying Evangelista, to affirm Yap, et al.’s, conviction based on supposed acts not found in the
Information would gravely violate the sacred constitutional right of Yap, et al. to be informed of the nature and
cause of the accusation against them.

(3) NO. In Intestate Estate of Carungcong v. People, the Court ruled that the fundamental principle in
applying and in interpreting criminal laws is to resolve all doubts in favor of the accused. In dubio pro reo. In case
of doubt, then for the accused. This is in consonance with the constitutional guarantee that the accused shall
be presumed innocent until proven otherwise.

Intimately related to the in dubio pro reo principle is the rule of lenity. The rule applies when the court is
faced with two possible interpretations of a penal statute, one that is prejudicial to the accused and another that
is favorable to him or her. The rule calls for the adoption of an interpretation which is more lenient to the
accused. In addition, the equipoise rule provides that where the evidence in a criminal case is evenly balanced,
the constitutional presumption of innocence tilts the scales in favor of the accused.

Here, the provision of the Contract did not explicitly state when the share of the government should
be paid. What is clear though, based on the attendant circumstances of the case, was - time was of the essence.
Accordingly, the amount of P6 million necessarily had to be paid before the delivery of the ARFFV itself since
precisely this item could only be brought into the Philippines upon the obtention of the required letter of credit,
a condition imposed under the Contract itself, as approved by the MCIAA Board of Directors.

Accordingly, the right time for its payment ought to coincide with when exactly it was needed to achieve
the purpose for which it was intended in the first place. Stated differently, it should be paid at the time when
the need for it arose, that was, at the filing of the application for the letter of credit. Hence, the payment of P6
million, representing the government's share in the costs and expenses for securing the required letter of credit,
was not premature.

In fine, the application here of Section 88 of P.D. No. 1445 which prohibits the advance payment for
services not yet rendered or for supplies and materials not yet delivered was at best misplaced. Even then, a
violation of this provision does not ipso facto indicate the presence of manifest partiality, evident bad faith, or
gross inexcusable negligence.

(4) NO. The elements of the crime under Section 3(g) of R.A. No. 3019 are:

(a) the offender is a public officer;

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(b) he or she enters into a contract or transaction on behalf of the government; and
(c) the contract or transaction is grossly and manifestly disadvantageous to the government.

Here, the third element was absent.

In Morales v. People, the Court ordained that with respect to the third element of violation of Section
3(g) of R.A. No. 3019, 'manifest' means obvious to the understanding, evident to the mind and is synonymous
with open, clear, visible, unmistakable, indubitable, evident and self-evident. 'Gross,' on the other hand, means
flagrant, shameful, such conduct as is not to be excused.

Here, it was not Yap, but the MCIAA Board of Directors which approved the increased budget for
the procurement of the ARFFV and authorized the procurement in the amount of USD 732,000.00. As for the
supposed discrepancy between the ClF value of the ARFFV and the declared value of the ARFFV, there was
simply no proof that Yap had any participation in the preparation of these documents since obviously the same
came into existence only long after he had already vacated the position of General Manager of the MCIAA.

Consequently, it was the height of injustice to make Yap criminally liable for an act he did not officially
or personally perform; nor in any way have any participation therein. The prosecution's evidence simply failed
to establish that he committed the act described in the Information as an alleged violation of Section 3(g) of
Republic Act No. 3019.

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PEOPLE OF THE PHILIPPINES v. ABDUL AZIS AND ALIBAIR MACADATO

G.R. No. 258873, 30 August 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

A warrantless arrest may be justified under any of the following circumstances provided in Rule 113, Section 5 of the
Revised Rules of Criminal Procedure.

Azis and Macadato’s arrest falls under Rule 113, Section 5 (a), i.e., they were caught in flagrante delicto of illegally
possessing dangerous drugs.

Both the trial court and the Court of Appeals gave credence to PO1 Alcova’s testimony that while he and the apprehending
team were conducting Oplan Galugad within Phase 12, Barangay 188, Tala, Caloocan City, he heard Azis saying to Macadato
“eto pa yung tamok galing kay Patak” and thereafter saw Azis bring out a plastic bag of shabu from his sling bag and hand it
to Macadato, who then immediately slid it inside his own sling bag. The fact that PO1 Alcova was only 1.5 meters away from
Azis and Macadato at that time allowed him to hear and see clearly their illegal acts.

FACTS
A team of police officers was conducting an operation called “Oplan Galugad” when they noticed two
men carrying a sling bag. One of the officers, PO1 Alcova, heard one of them say to the other, “eto pa yung
tamok galing kay Patak.” One of the men, Abdul Azis (Azis), took out a plastic bag of suspected shabu and
gave it to Alibair Macadato (Macadato), who put it in his sling bag. PO1 Alcova apprehended Azis and Macadato
upon witnessing this, and seized Azis’ sling bag. This contained suspected shabu and a firearm. The officers
marked the sling bag and the sachets of suspected shabu.

The seized drugs were turned over to the investigator on duty. During the inventory and
photographing, only a media representative was present and there were no representatives from the barangay
and the DOJ. After signing the needed receipts, the seized items were sent to a crime lab for examination. The
specimens tested positive for methamphetamine hydrochloride.

The Regional Trial Court (RTC) found both Azis and Macadato guilty of violating Section 11 of Art.
II, R.A. 9165, holding that the chain of custody remained intact and unbroken. Although not all requirements
in Section 21 of R.A. 9165 were not fully complied with, there were justifiable grounds and that the evidentiary
value of the items were preserved.

The conviction was sustained by the Court of Appeals (CA), holding that the arrests were in flagrante
delicto arrests. The officers’ failure to secure the presence of an elected public official and/or a representative
from the National Prosecution Service was justified and that the presence of a lone media representative was
enough to ensure the integrity and evidentiary value of the seized drugs.

ISSUE
Is the arrest of Azis and Macadato a valid warrantless arrest?

RULING
YES. A warrantless arrest may be justified under any of the following circumstances provided in Rule
113, Section 5 of the Revised Rules of Criminal Procedure which states:

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A peace officer or a private person may, without a warrant, arrest a person:

(a) When in his presence, the person to be arrested has committed, is actually committing, or is
attempting to commit an offense;
(b) When an offense has just been committed and he has probable cause to believe based on personal
knowledge of facts or circumstances that the person to be arrested has committed it; and
(c) When the person to be arrested is a prisoner who has escaped from a penal establishment or place
where he is serving final judgment or is temporarily confined while his case is pending, or has escaped
while being transferred from one confinement to another.

Azis and Macadato’s arrest falls under Rule 113, Section 5 (a), i.e., they were caught in flagrante delicto
of illegally possessing dangerous drugs.

Both the trial court and the Court of Appeals gave credence to PO1 Alcova’s testimony that while he
and the apprehending team were conducting Oplan Galugad within Phase 12, Barangay 188, Tala, Caloocan
City, he heard Azis saying to Macadato “eto pa yung tamok galing kay Patak” and thereafter saw Azis bring out
a plastic bag of shabu from his sling bag and hand it to Macadato, who then immediately slid it inside his own
sling bag. The fact that PO1 Alcova was only 1.5 meters away from Azis and Macadato at that time allowed
him to hear and see clearly their illegal acts.

Where the in flagrante delicto arrest of the accused was lawful, there is no need for a warrant for the
seizure of the fruit of the crime as well as for the body search upon him, the same being incidental to a lawful
arrest and the search may extend beyond the person of the one arrested to include the premises or surroundings
under his immediate control.

In any case, Azis and Macadato can no longer object to the validity of their arrest and the incidental
search thereto. It is settled that any objection by the accused to an arrest without a warrant must be made before
they enter their plea, otherwise the objection is deemed waived. Here, not only did Azis and Macadato fail to
question their arrest and incidental search before they entered their plea, they also did not question the same
during trial and was only brought up as a defense for the first time before the Court of Appeals. Therefore, the
legality of their arrest and the incidental search must stand.

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AAA261422, a minor and represented by YYY261422 v. XXX261422

G.R. No. 261422, 13 November 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Double jeopardy sets in only upon:
(a) a valid indictment;
(b) before a competent court;
(c) after arraignment;
(d) a valid plea having been entered; and
(e) the case was dismissed or otherwise terminated without the express consent of the accused.

It is settled doctrine that double jeopardy cannot be invoked against the Court's setting aside of the trial court's judgment
of acquittal where the prosecution which represents the sovereign people in criminal cases is denied due process. For the cardinal
precept is that where there is a violation of basic constitutional rights, courts are ousted of their jurisdiction.

Here, second requisite is missing. The RTC was ousted of jurisdiction when it violated the People and AAA's right to
due process, hence, it was not a competent court.

FACTS
AAA261422 (AAA), 13 years old, and her siblings lived with her mother, CCC261422 (CCC) together
with the latter's live-in partner XXX261422 (XXX).

One time, AAA was asleep in her room when she was awakened and saw XXX covering her mouth.
He unzipped her shorts and inserted his finger into her vagina several times. He also sucked her breasts. After
that, he left and went to the kitchen. This incident was repeated three times. During all three instances, he licked
and sucked her breasts. However, on the third occasion, he was only able to touch her vagina because her
mother woke up.

AAA told the incident to her aunt, YYY261422 (YYY). YYY thus brought AAA to the Municipal Social
Welfare and Development Office and the police station to lodge complaints against XXX.

Dr. Ava O. Liwanag (Dr. Liwanag), a health officer, examined AAA. The examination results showed
that AAA sustained a hymenal laceration at the 7:00 o'clock position and her hymen was no longer intact. Dr.
Liwanag explained that the rupture of the hymen may be caused by sexual intercourse, masturbation, insertion
of foreign bodies, vaginal irritation or the passage of large blood clot during menstruation. She also saw an old
laceration in AAA's hymen.

Accordingly, XXX was charged with 2 counts of rape and one count of acts of lasciviousness.

The Regional Trial Court (RTC) acquitted XXX on reasonable doubt. AAA thus filed a petition for
certiorari before the Court of Appeals (CA). However, the CA dismissed the petition on June 25, 2020.

AAA filed a petition for review on certiorari to the Supreme Court (Court).

ISSUE

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Could XXX invoke double jeopardy as a defense?

RULING
NO. A judgment of acquittal, whether ordered by the trial court or the appellate court, is final,
unappealable, and immediately executory upon its promulgation. Accordingly, the State may not seek its review
without placing the accused in double jeopardy.

Double jeopardy sets in only upon:

(f) a valid indictment;
(g) before a competent court;
(h) after arraignment;
(i) a valid plea having been entered; and
(j) the case was dismissed or otherwise terminated without the express consent of the accused.

Accordingly, it is settled doctrine that double jeopardy cannot be invoked against the Court's setting
aside of the trial court's judgment of acquittal where the prosecution which represents the sovereign people in
criminal cases is denied due process. For the cardinal precept is that where there is a violation of basic
constitutional rights, courts are ousted of their jurisdiction.

Here, second requisite is missing. The RTC was ousted of jurisdiction when it violated the People and
AAA's right to due process, hence, it was not a competent court.

There being no violation of the rule on double jeopardy, nothing bars the CA from entertaining the
petition for certiorari filed by AAA261422 and reviewing the grave errors ascribed to the assailed judgment of
the trial court. Considering, however, that the case had been pending for years, the Court, in the interest of
expediency, shall itself resolve the merits of AAA261422's petition for certiorari. For indeed, nothing rings truer
than the maxim, "justice delayed is justice denied."

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PROVINCE OF MAGUINDANAO DEL NORTE v. BUREAU OF LOCAL GOVERNMENT

FINANCE, REGIONAL OFFICE NO. XII, et al.
G.R. No. 265373, 13 November 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

To warrant a finding of abandonment, its two essential elements must be present:

(a) Intention to abandon; and

(b) An overt or external act by which the intention is carried into effect.

In the case of Sangguniang Bayan of San Andres v. CA (San Andres), the Court ruled that private respondent was
deemed to have abandoned his office as a member of the Sangguniang Bayan based on his acts indicative of his intention to abandon
the same.

Here, Sinsuat never expressed any objection when the President appointed Macacua as OIC Governor of Maguindanao
del Norte. Accordingly, she ceased to discharge the functions of Governor of Maguindanao del Norte in the interim. Lastly, by
virtue of her voluntary relinquishment of the position, she likewise presumably failed to collect the remuneration for the post of
Governor during such period.

FACTS
Republic Act No. 11550 (R.A. No. 11550) was signed into law, dividing the province of Maguindanao
into Maguindanao del Norte and Maguindanao del Sur, which would be created upon approval by the majority
of voters in the affected areas in a plebiscite to be conducted and supervised by the Commission on Elections
(COMELEC) within 90 days of the law's effectivity. However, the COMELEC deferred the plebiscite until
after the 2022 National and Local Elections (2022 NLE).

Subsequently, the COMELEC conducted the plebiscite, which resulted in the ratification of R.A. No.
11550. Accordingly, following the structure of Section 50 of R.A. No. 11550, the elected Vice Governor of the
Province of Maguindanao, Fatima Ainee L. Sinsuat (Sinsuat), and the next ranking member of the Sangguniang
Panlalawigan of the same province, Datu Sharifudin Tucao P. Mastura (Mastura), would assume their respective
offices as Governor and Vice-Governor of Maguindanao del Norte.

Later, Sinsuat requested that the Bureau of Local Government Finance (BLGF) Region XII designate
Badorie M. Alonzo (Alonzo) as Provincial Treasurer of Maguindanao del Norte. However, when BLGF XII
sought legal guidance, the BLGF Central Office argued that since the plebiscite occurred only after the 2022
NLE, Section 50 would no longer apply regarding the assumption of office by the supposed governing officials
of the newly created Province of Maguindanao del Norte.

Maguindanao del Norte, represented by Sinsuat, thus filed a Petition for Mandamus to compel BLGF
Region XII, et al., to process the designation of Alonzo or any qualified person designated by Sinsuat as its
Provincial Treasurer.

However, later on, the President of the Philippines (President) appointed Abdulraof Abdul Macacua
(Macacua) as the Officer-in-charge (OIC) of the office of the Governor of Maguindanao del Norte. While

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Sinsuat was appointed as the Vice-Governor of Maguindanao del Norte. Both accepted the President’s
appointment and took their oaths of office.

Meanwhile, the Court issued Writ of Preliminary Mandatory Injunction, ordering BLGF Region XII,
et al., to process the designation of Alonzo or any qualified person as Provincial Treasurer of Maguindanao del
Norte.

Accordingly, the Office of the Solicitor General (OSG) argued, among others, that Sinsuat effectively
abandoned her claim as Acting Governor of Maguindanao del Norte and relinquished the authority to appoint
its Provincial Treasurer when she accepted her appointment and took her oath of office as the Vice Governor
of the said province. Consequently, she also effectively abandoned her interest in pursuing the subject of the
Petition, rendering the case moot.

ISSUES
(1) Had Sinsuat deemed to abandon her claim to the position of Governor when she accepted her
appointment as Vice Governor?
(2) Had the controversies involved in the present case become moot?

RULING
(1) YES. Abandonment of office is a specie of resignation, defined as the voluntary relinquishment of
an office by the holder, accompanied by the intention of terminating his or her possession and control thereof.
It springs from deliberation and freedom of choice. Its concomitant effect is that the former holder of an office
can no longer legally repossess it even by forcible reoccupancy.

To warrant a finding of abandonment, its two essential elements must be present:

(a) Intention to abandon; and

(b) An overt or external act by which the intention is carried into effect.

In the case of Sangguniang Bayan of San Andres v. CA (San Andres), the Court ruled that private respondent
was deemed to have abandoned his office as a member of the Sangguniang Bayan based on his acts indicative
of his intention to abandon the same. Notably, Sinsuat did the same acts, as shown below.

Here, Sinsuat never expressed any objection when the President appointed Macacua as OIC Governor
of Maguindanao del Norte. Accordingly, she ceased to discharge the functions of Governor of Maguindanao
del Norte in the interim. Lastly, by virtue of her voluntary relinquishment of the position, she likewise
presumably failed to collect the remuneration for the post of Governor during such period.

More compelling, the following positive acts of Sinsuat virtually carried into effect her intention to
abandon the post of Governor of Maguindanao del Norte.

First, she accepted her appointment as Vice Governor of the province, knowing full well that by doing
so, she could not simultaneously be the Governor of Maguindanao del Norte.

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Second, she took her oath of office as Vice Governor of Maguindanao del Norte before no less than
the President of the Philippines. Surely, the seriousness of swearing an oath before the very head of state
precludes any notion that such act was carried out without the most deliberate and cognizant intention of fully
assuming such position; and

Lastly, Sinsuat sealed her choice by assuming the office and discharging the duties and functions of
Vice Governor of Maguindanao del Norte while Macacua acted as Governor of the same province.

Certainly, the totality of the circumstances leads to no other reasonable conclusion that Sinsuat had
already abandoned her claim to the position of Governor of Maguindanao del Norte.

(2) YES. A case is moot if it ceases to present a justiciable controversy because of the supervening
events so that a declaration thereon would be of no practical use or value. When a case is moot and academic,
the Court generally declines jurisdiction over it, lest the ruling result in a mere advisory opinion. The rule stems
from the Court's judicial power, which is limited to settling actual cases and controversies involving legally
demandable and enforceable rights.

Significantly, in the case of Defensor-Santiago v. Ramos, the Court ruled that Defensor-Santiago was
deemed to have abandoned her claim to the presidential seat when she assumed the office of Senator, rendering
her election protest moot.

However, even if the case had become moot, the Court may still resolve the case if any of the following
exceptions are present:

(a) grave constitutional violations;

(b) exceptional character of the case;
(c) paramount public interest;
(d) the case presents an opportunity to guide the bench, the bar, and the public; or
(e) the case is capable of repetition yet evading review.

Here, considering Sinsuat's abandonment of her claim to the post of Governor of Maguindanao del
Norte, the issues raised in the Petition have been rendered moot and her authority to represent Maguindanao
del Norte had ceased, warranting the dismissal of the case.

Accordingly, none of the exceptions apply here, for it appeared that the province of Maguindanao del
Norte had, during the pendency of the case, become slowly operational. The President had appointed key
officials in the province who now manage and oversee the administration of the provincial government's affairs.
More, the birthing pain experienced by the new province of Maguindanao del Norte from which the Petition
arose was a rare and unique occurrence which will not likely find identical repetition in the future.

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ANTONIO ABIANG y CABONCE v. PEOPLE OF THE

PHILIPPINES
G.R. No. 265117, 13 November 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

The constitutional guarantee against unreasonable searches and seizures rests upon a valid determination of probable
cause, which requires adequate factual basis. The Court has held that the absence of any record of how the issuing judge determined
probable cause is inconsistent with the regular performance of duties and contradicts an assurance of a "probing and exhaustive"
examination of the witnesses.

Here, Abiang argues that the Search Warrant is invalid since its issuance was tainted with irregularities. He claims that
there was no record or stenographic notes of the proceedings in which Judge Viterbo allegedly propounded the required searching
questions and answers; the affidavits of the complainant and witnesses were not attached to the records of the case; the testimonies
given during the trial made no reference at all to the application for the Search Warrant; it was never disclosed who applied for the
Search Warrant; and the police officers who implemented the same had no participation in the application therefor as in fact, it was
never mentioned why the same was issued against Abiang; nor were the antecedent facts which led to its application disclosed.

FACTS
The Firearms and Explosives Office, Camp Crame, Quezon City issued via email an Initial Firearms
Holder Verification Report stating that Antonio Abiang y Cabonce (Abiang) is not a licensed firearm holder.

Executive Judge Frazierwin V. Viterbo (Judge Viterbo) of the Regional Trial Court (RTC) Nueva Ecija,
issued a Search Warrant dated May 22, 2019 against Abiang, authorizing the search of his house located in Brgy.
Cabaducan East, Nampicuan, Nueva Ecija, for a possible violation of Republic Act No. 10591 (R.A. No.
10591).

Thereafter, a team was constituted at the Nampicuan Police Station to implement the Search Warrant.
The team coordinated with Barangay Captain Arceo Papilla (Brgy. Capt. Papilla) and Kagawad Edgar Butay
(Kgd. Butay), who were to serve as witnesses during the search.

In the bedroom, Police Corporal Noel D. Pader (PCpl Pader) found a black basin containing some
clothes. When he removed the clothes, he found a sling bag. When he opened it, he saw a .38 caliber revolver
loaded with six pieces of live ammunition, one live ammunition, and four pieces of fired cartridge cases of the
same caliber. He disclosed his discovery to the barangay witnesses and Abiang, who was then arrested upon
being apprised of his rights.

PCpl Pader unloaded the bullets from the revolver and laid all the items he found on top of the bed.
He placed the markings on the firearm, live ammunitions, and the empty shells. The police officers did the
inventory of the confiscated items while the police investigator took photographs. Abiang was brought to the
police station.

The confiscated items were turned over to the Nueva Ecija Police Crime Laboratory Office
(NEPCLO) for ballistic examination. They were kept by the evidence custodian of NEPCLO, for safekeeping
prior to their presentation in court.

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Abiang offered the defenses of denial and frame-up. Brgy. Capt. Papilla, who was then with Kgd. Butay
testified that he did not see the confiscation of any contraband as the police officers were already taking pictures
of the alleged evidence when he arrived. Abiang denied ownership of the confiscated items, claiming that the
police officers must have placed the same in the basin themselves. He also posited that somebody must have
been envious of his close relation with the barangay captain, which could have been the reason why someone
reported that he fired a gun.

Abiang was charged with violation of R.A. No. 10591 or illegal possession of firearms. The trial court
convicted Abiang of the crime. The Court of Appeals affirmed but modified the penalty.

ISSUE
May Abiang be convicted of the crime charged?

RULING
NO. The search warrant was issued without probable cause; hence, invalid.

The State may only conduct searches and seizures pursuant to a valid warrant, which requires that: (1)
it must be issued based on a finding of probable cause; (2) probable cause must be determined personally by
the judge; (3) the judge must examine under oath or affirmation the complainant and the witnesses he or she
may produce; and (4) the warrant must particularly describe the place to be searched and the persons or things
to be seized. Any evidence obtained in violation of this rule shall be inadmissible for any purpose in any
proceeding.

First, apart from the lone statement in the Search Warrant itself, as well as in the Order dated May 22,
2019 issuing the search warrant, there was absolutely nothing in the case records which might, at the very least,
hint that Judge Viterbo propounded searching questions to the applicant and his/her witnesses which may lead
to a finding of probable cause against Abiang.

Worse, the antecedent facts, as culled from the records, do not reveal why the Search Warrant was
even issued against Abiang in the first place. They merely state that one was issued on May 22, 2019 sans any
further details on the matter. Even if the Court acknowledges the Initial Firearms Holder Verification Report
dated May 21, 2019, this piece of evidence alone is insufficient to sustain a finding of probable cause against
Abiang as it only certifies that he is not licensed to possess any kind of firearm but it does not, in any way,
prove that he is in actual possession of any firearm or ammunition.

In People v. Tee, the Court elucidated that while the absence of depositions and their transcript does not
necessarily invalidate a search warrant, there must nonetheless be particular facts and circumstances present in
the records of the case which the judge considered sufficient to ordain the existence of probable cause. In their
absence, however, a warrant may still be upheld if there is evidence in the records that the requisite examination
was made and probable cause was based thereon. There must be, in the records, particular facts and
circumstances that were considered by the judge as sufficient to make an independent evaluation of the
existence of probable cause to justify the issuance of the search warrant.

The People, through the OSG, did not proffer any explanation nor clarification on the obscurity of
the details involving the application for and issuance of the Search Warrant. It merely invoked the presumption

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of regularity in the performance of duty by the issuing judge and further evaded the issue by pointing out that
Abiang had already waived any objection to the validity of the search warrant when he failed to raise the same
before the trial court.

The constitutional guarantee against unreasonable searches and seizures rests upon a valid
determination of probable cause, which requires adequate factual basis. The Court has held that the absence of
any record of how the issuing judge determined probable cause is inconsistent with the regular performance of
duties and contradicts an assurance of a "probing and exhaustive" examination of the witnesses.

In Malaloan v. Court of Appeals, and as now provided under Rule 126, Section 14 of the Rules of Court,
the Court explained that any objections to the legality of the search warrant may be done either through: (1) a
motion to quash the search warrant filed before the issuing court; or (2) a motion to suppress evidence filed
before the court where the criminal case is pending. Objections to the legality of search warrants and the
admissibility of the evidence obtained pursuant thereto must be raised during the trial of the case; otherwise,
they are considered waived.

This rule has been relaxed by the Court especially in cases involving blatant violations of the right
against unreasonable searches and seizures such as here. Indeed, the ends of the higher interest of justice are
better served when the supremacy of this constitutionally protected right is preserved over mere technical rules
of procedure.

Abiang's objection to the admissibility of the Search Warrant as evidence before the trial court 60 belies
any intention on his part to waive his objections against its validity. More important, his failure to timely raise
the same cannot serve to cure the inherent defect of the Search Warrant in this case.

Considering the nullity of the Search Warrant, the search conducted pursuant thereto is likewise void.
Any evidence obtained in violation of Abiang's right against unreasonable searches and seizures, i.e., the firearm
and ammunitions confiscated inside Abiang's house, shall be inadmissible. Consequently, there is no more
evidence to support Abiang's conviction for violation of R.A. No. 10591. All told, a verdict of acquittal is in
order.

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VICENTE SUAREZ JR. Y BANUA v. PEOPLE OF THE PHILIPPINES

G.R. No. 268672, 04 December 2023, SECOND DIVISION, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

In Villa Gomez v. People, the Court held that since rules of procedure are not ends in themselves, courts may still brush
aside procedural infirmities in favor of resolving the merits of the case. Correlatively, since legal representation before the courts and
quasi-judicial bodies is a matter of procedure, any procedural lapse pertaining to such matter may be deemed waived when no timely
objections have been raised.

The Court sustains Suarez, Jr.’s invocation of double jeopardy. Indeed, all the requisites therefor are present in this case:
(1) he was indicted under a valid Information, (2) the trial court possessed jurisdiction over him and the offense charged; (3) following
the trial court’s approval of his plea bargain, he was arraigned for the lesser offense and entered a valid plea therefor; and (4) there
was a termination of the case in view of his eventual conviction for violation of Article II, Section 12 of Republic Act No. 9165.

FACTS
Vicente Suarez, Jr. (Suarez, Jr.) was charged with illegal sale of dangerous drugs. Suarez, Jr. filed a
motion to enter a plea of guilty to a lesser offense of violation of Article II, Section 12 of Republic Act No.
9165 otherwise known as the Comprehensive Dangerous Drug Act of 2002 (R.A. No. 9165), in lieu of the
original charge of violation of Section 5 of the same law. People of the Philippines (People) opposed the motion,
asserting, among others, that the approval of the public prosecutor and the arresting officers are required in
plea bargaining for offenses under R.A. No. 9165.

The Regional Trial Court (RTC) granted Suarez, Jr.’s motion and ordered that Suarez, Jr.’s plea of guilty
be entered into the records of the case. People sought reconsideration but the same was denied. On appeal,
People argued that the RTC acted with grave abuse of discretion for allowing Suarez, Jr. to plead guilty to a
lesser offense, sans its concurrence.

The Court of Appeals (CA) agreed with People that the consent of the prosecutor is a condition sine
qua non to obtaining a valid plea of guilty to a lesser offense. The CA rendered a decision in favor of People and
ordered the case to be remanded to RTC.

Hence, the instant case. Suarez, Jr. argued that a remand of the case will violate his constitutional right
against double jeopardy.

ISSUE
Would the remand of the case violate Suarez, Jr.’s constitutional right against double jeopardy?

RULING
YES. The concurrence of the prosecution is not an indispensable requirement for the trial court’s grant
of the motion to plead guilty to a lesser offense. Rather, the trial court must exercise its sound discretion in
accepting the terms of the plea bargaining.

The Court, nonetheless, finds that the trial court should not have granted the offer to plead guilty to a
lesser offense in this case for the simple reason that the original charge for which he was indicted (violation of
Article II, Section 5 of Republic Act No. 9165) involved 2.1585 grams of methamphetamine hydrochloride, in

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which case, plea bargaining is proscribed. Evidently, therefore, the trial court gravely erred in granting Suarez,
Jr.’s motion for plea bargaining and in consequently convicting him of the lesser offense of violation of Article
II, Section 12 of Republic Act No. 9165.

The Court notes, however, that although plea bargaining should not have been allowed, this argument
was never put to fore by People itself in any of its pleadings before the trial court, the appellate court, and now
even before the Court. People’s opposition was solely anchored on the fact that it did not conform to Suarez,
Jr.’s proposed plea bargaining. In any event, both the trial court and the appellate court themselves overlooked
the fact that Suarez, Jr.’s case fell within the excepting clause.

As it was, the trial court approved Suarez, Jr.’s proposed plea bargaining which eventually led to his re-
arraignment, his plea of guilty to the lesser offense of violation of Article II, Section 12 of Republic Act No.
9165, and finally, the promulgation of a judgment of conviction against him for such lesser offense, which
judgment has already become final and executory.

Hence, the Court sustains Suarez, Jr.’s invocation of double jeopardy. Indeed, all the requisites therefor
are present in this case: (1) he was indicted under a valid Information, (2) the trial court possessed jurisdiction
over him and the offense charged; (3) following the trial court’s approval of his plea bargain, he was arraigned
for the lesser offense and entered a valid plea therefor; and (4) there was a termination of the case in view of
his eventual conviction for violation of Article II, Section 12 of Republic Act No. 9165.

In Villa Gomez v. People, the Court held that since rules of procedure are not ends in themselves, courts
may still brush aside procedural infirmities in favor of resolving the merits of the case. Correlatively, since legal
representation before the courts and quasi-judicial bodies is a matter of procedure, any procedural lapse
pertaining to such matter may be deemed waived when no timely objections have been raised. In the same vein,
plea bargaining being a rule of procedure, People’s failure to invoke Suarez, Jr.’s disqualification from plea
bargaining may be deemed waived. That the trial court and the Court of Appeals erred in their application of
the Plea Bargaining Framework in Drugs Cases in favor of Suarez, Jr.; and People was even deemed to have
waived the exclusion clause therein should not be blamed on Suarez, Jr.. His right against double jeopardy
should therefore be sustained.

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WALTER MANUEL F. PRESCOTT v. BUREAU OF IMMIGRATION, as represented by HON.

ROGELIO D. GEVERO, JR., and the DEPARTMENT OF JUSTICE
G.R. No. 262938, 05 December 2023, EN BANC, (Lazaro-Javier, J.)

DOCTRINE OF THE CASE

Election of citizenship under the 1935 Constitution may be done in two ways:

(a) through formal election pursuant to Commonwealth Act No. 625; or

(b) through informal election, such as when it is evident from the positive acts of a child born to a mixed marriage
that he or she chose Philippine citizenship.

In Cabiling Ma v. Fernandez, Jr. (Cabiling Ma), the Court ruled that the Cabiling Ma, et al., were deemed Filipinos
in view of the fact that they already formally elected Philippine citizenship but only failed to register the same beyond the prescribed
timeframe. In the meantime, they have consistently and continuously done positive acts of citizenship manifesting their choice to
become Philippine citizens.

Accordingly, the special circumstances availing in Cabiling Ma and the logic applied by the Court therein may also be
applied in favor of Prescott. Here, it was true that Prescott never, by formal deed, elected Philippine citizenship within a reasonable
time upon reaching 21 years old. The Court found, however, that the Oath of Allegiance executed by Prescott in 2008 when he re-
acquired Philippine citizenship under Republic Act No. 9225 constituted substantial compliance with the formal election
requirements under Commonwealth Act No. 625.

FACTS
Walter Manuel F. Prescott (Prescott) was born on April 10, 1950, in the Philippines to an American
father and a Filipino mother. He never left the Philippines since he was born. Accordingly, in 1977, he was
informed by the American Embassy in Manila that he lost his American citizenship for overstaying in the
Philippines.

Later, he married Maria Lourdes S. Dingcong (Dingcong), an American citizen, in the Philippines. He
indicated his nationality as Filipino on their marriage contract and their child's birth certificate. After moving
to the United States of America (USA) to work for the World Bank, he became a naturalized American citizen.
He also traveled several times to the Philippines with balikbayan status.

Consequently, Prescott applied for reacquisition of his Philippine citizenship under Republic Act No.
9225. Accordingly, an order for the reacquisition of Philippine citizenship was issued in favor of him. He was
also issued a Philippine passport. When he retired from the World Bank, he immediately returned to the
Philippines with his wife, Dingcong, to settle for good. However, Dingcong went back to the USA.

Later, Dingcong filed with the BI a complaint against Prescott, alleging that he illegally reacquired his
Philippine citizenship. Several notices were sent to Prescott's supposed address asking him to appear on the
scheduled hearings regarding the complaint. Prescott, however, failed to appear. The notices were returned
"unserved" or Prescott was "out of the country." Accordingly, the BI recommended to the Secretary of Justice
(SOJ) to cancel Prescott's re-acquisition of Philippine citizenship. The SOJ approved the recommendation.
Prescott discovered this only when he tried to renew his Philippine passport. He requested case records from
the SOJ but was informed the Resolution of the Department of Justice (DOJ) was final and executory.

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Prescott was arrested pursuant to the warrant of deportation. Prescott filed a very urgent motion for
his release and dismissal of the deportation case against him. The BI denied the motion to release on bail and
treated his motion to dismiss as a motion for reconsideration (MR). Prescott filed his motion to re-open his
deportation case but the same was denied with finality.

ISSUES
(1) Was Prescott’s constitutional right to due process violated?
(2) May Prescott be legally deported?

RULING
(1) YES. The right of the People to due process is enshrined under Article III, Section 1 of the 1987
Constitution, which states that no person shall be deprived of life, liberty, or property without due process of
law, nor shall any person be denied the equal protection of the laws. This right is guaranteed not only in judicial
proceedings but also in administrative proceedings.

In administrative proceedings, the respondent has the right to a fair and reasonable opportunity to
explain his or her side, or an opportunity to seek a reconsideration of the action or ruling complained of.
Administrative due process, however, is not identical to the due process required in judicial proceedings. For
the latter requires a formal or trial-type hearing while the former does not strictly abide by technical rules of
procedure.

In fine, as long as the parties are given the opportunity to be heard before judgment is rendered, the
demands of due process are deemed sufficiently complied with. The requirements of administrative due process
are thoroughly laid out in the seminal case of Ang Tibay v. Court of Industrial Relations, viz.:

(a) The right to a hearing must be respected, which includes the right of the party interested or affected
to present his or her own case and submit evidence in support thereof;
(b) Not only must the party be given an opportunity to present his or her case and to adduce evidence
tending to establish the rights he or she asserts but the tribunal must consider the evidence presented;
(c) There must be evidence to support the finding or conclusion of the tribunal;
(d) Not only must there be evidence to support a finding or conclusion, but the evidence must be
substantial. Substantial evidence is such relevant evidence as a reasonable mind would accept as
adequate to support a conclusion;
(e) The decision must be rendered on the evidence presented at the hearing, or at least contained in the
record and disclosed to the parties affected;
(f) The tribunal must act on its own independent consideration of the law and facts of the controversy
and not simply accept the views of a subordinate in arriving at a decision; and
(g) The decision should be rendered in a manner that the parties to the proceeding can know the various
issues involved, and the reasons for the decision rendered.

Measured against these guidelines, there was a perceptible violation of Prescott's right to administrative
due process in the BI proceedings.

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Here, BI and DOJ did not contest that Prescott never received the notices allegedly sent by the Bureau
to him for the scheduled hearings. In addition, as regards the revocation of the reacquisition of his Philippine
citizenship, Bureau and DOJ did not allege, much less, adduce evidence, that Prescott was furnished a copy of
the same. Clearly, Prescott was undoubtedly deprived of any opportunity to present his case and submit
evidence to counter the allegations of fraud imputed against him.

Further, the Court ruled that mere filing of a MR cannot cure any due process defect, especially if the
same was filed precisely to raise the issue of violation of the right to due process considering that up until that
point, the opportunity to be heard on the merits had remained elusive.

In the case of Fontanilla v. Commission Proper, the Court ruled that if a person has not been given the
opportunity to squarely and intelligently answer the accusations or rebut the evidence presented against him,
or raise substantive defenses through the proper pleadings before a quasi-judicial body where he or she stands
charged, then a due process problem exists. This problem worsens and the denial of his most basic right
continues if, in the first place, he is found liable without having been charged and this finding is confirmed in
the appeal or reconsideration process without allowing him to rebut or explain his side on the finding against
him.

Here, neither the BI nor the DOJ passed upon Prescott's arguments in his motions where he invariably
raised violation of his right to due process. Neither did they allow him to air his defenses against the accusations
against him in the complaint. Nor was he even furnished copies of the records. All told, the mere fact that he
filed motions for reconsideration before the Bureau and the DOJ, which nonetheless were never properly
considered by Bureau and the DOJ, does not amount to a fair and reasonable opportunity to be heard required
by the Constitution, law, and jurisprudence.

Consequently, for having been rendered in violation of Prescott's fundamental right to due process,
the proceedings before the BI as well as the DOJ Resolution were void ab initio.

(2) NO. Prescott was born on August 10, 1950. Any issue regarding his citizenship consequently falls
under the aegis of the 1935 Constitution. Accordingly, Unlike the 1973 and 1987 Constitutions, the 1935
Constitution does not automatically recognize children born to Filipino mothers as Philippine citizens. As a
rule, they follow the citizenship of their alien father, unless, upon reaching the age of majority, they elect
Philippine citizenship. During the child's minority, what he or she possessed was merely an inchoate right to
choose Philippine citizenship.

Pursuant to Commonwealth Act No. 625, the election of Philippine citizenship must be done in
accordance with several formal requisites, such as:

(a) the same must be in writing;

(b) under oath;
(c) filed with the civil registry; and
(d) accompanied with an oath of allegiance to the Constitution and the Philippine government.

In the case of Cueco v. Secretary of Justice and Commissioner of Immigration, the election of Philippine
citizenship should be done within a reasonable time, id est, three years, subject to extension under certain

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circumstances such as when the person has always considered himself or herself as a Filipino, but not exceeding
seven years.

Per existing jurisprudence, election of citizenship under the 1935 Constitution may be done in two
ways:
(a) through formal election pursuant to Commonwealth Act No. 625; or
(b) through informal election, such as when it is evident from the positive acts of a child born to
a mixed marriage that he or she chose Philippine citizenship.

In Cabiling Ma v. Fernandez, Jr. (Cabiling Ma), the Court ruled that the Cabiling Ma, et al., were deemed
Filipinos in view of the fact that they already formally elected Philippine citizenship but only failed to register
the same beyond the prescribed timeframe. In the meantime, they have consistently and continuously done
positive acts of citizenship manifesting their choice to become Philippine citizens.

Accordingly, the special circumstances availing in Cabiling Ma and the logic applied by the Court therein
may also be applied in favor of Prescott.

Here, it was true that Prescott never, by formal deed, elected Philippine citizenship within a reasonable
time upon reaching 21 years old. The Court found, however, that the Oath of Allegiance executed by Prescott
in 2008 when he re-acquired Philippine citizenship under Republic Act No. 9225 constituted substantial
compliance with the formal election requirements under Commonwealth Act No. 625.

While it was undeniable that it took Prescott 30 years after reaching 21 years old before he executed
his Oath of Allegiance pursuant to Republic Act No. 9225, his peculiar and unique circumstances absolutely
justify an exception from the prescribed timeframe. To be sure, the time within which formal election must be
made was never enshrined in Commonwealth Act No. 625 but was merely laid down in jurisprudence. Even
then, the Court were cognizant that such period, when warranted by special circumstances, as here, may be
extended.

Here, Precott was born and raised in the Philippines. After he lost his American citizenship, he
consistently identified himself as Filipino in all his documents, including his Marriage Contract and the
Certificate of Live Birth of his first child.

In addition, when he was in the USA for his employment with the World Bank, he had to be naturalized
to become an American citizen. If indeed Prescott had been an American all along, he would not have had to
obtain American citizenship anew, much less, be naturalized to become one. Further, even when he became a
naturalized American citizen, he never really abandoned being a Filipino. In fact, he would often travel back to
the Philippines, and, significantly, he did so with a balikbayan status.

Prescott also obtained dual citizenship when he reacquired his Philippine citizenship under Republic
Act No. 9225. Lastly, when he retired, he chose to leave everything he had and return to the Philippines to
settle for good, even when his own wife left him to return to the USA, where she remained until now.

In any case, even if Prescott's Oath of Allegiance in 2008 could not be considered as his formal election,
he was still deemed a natural-born Filipino pursuant to the 1961 Convention on Reduction of Statelessness. To

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recall, he lost his American citizenship when he was 26 years old for failing to return to the USA within the
period prescribed under its law. Neither was he recognized as a Philippine citizen at the time under the 1935
Constitution. In fine, he became, as a result of the operation of American and Philippine laws, a stateless person
as defined under Article 1(1) of the Convention Relating to the Status of Stateless Persons, to which the
Philippines acceded in 2011.

Pursuant to Article 1(4) of the Convention, the Philippines had the obligation to recognize Prescott,
born to a Filipino mother, as a Philippine citizen after failing to formally elect Philippine citizenship within the
prescribed time since he would have otherwise become a stateless person. This grant of nationality to Prescott,
to this Court, must be reckoned from his birth if we are to give full life to the Philippines' commitment under
the Convention.

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