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[NUMBER] [CASE TITLE]

Docket No.| Date | Topic | Ponente | Digest Maker

Petitioner:
Respondents:

Case Doctrine :

FACTS:

ISSUE/S:
Whether or not (YES/NO)
Whether or not (YES/NO)

HELD:
 [1] [MACEDA vs ERB]
G.R. No. 95203-05| December 18, 1990 | Topic | J. Sarmiento | Chua

Petitioner: Senator Ernesto Maceda

Respondents: Energy Regulatory Board (ERB)

Case Doctrine:

FACTS: Caltex, Shell and Petron filed separate applications with the ERB for permission to increase the
wholesale prices of petroleum products, and meanwhile, for provisional authority to temporarily
increase such prices pending further proceedings. The ERB, in a joint order granted provisional relief
and authorizes said applicant a provisional increase. The petitioners, Sen. Ernesto Maceda and Atty.
Oliver Lozano submits that the same was issued without proper notice and hearing in violation of
Section 3, paragraph (e) of EO No. 172, and has been issued with grave abuse of discretion,
tantamount to lack of jurisdiction. Section 3 states that the Board shall, upon proper notice and
hearing, exercise the following, among other powers and functions: (e) Whenever the Board has
determined that there is a shortage of any petroleum product, or when public interest so requires, it
may take such steps as it may consider necessary, including the temporary adjustment of the levels of
prices of petroleum products and the payment to the Oil Price Stabilization Fund created under
Presidential Decree No. 1956 by persons or entities engaged in the petroleum industry of such
amounts as may be determined by the Board, which will enable the importer to recover its cost of
importation. Hence, this petition praying for injunctive relief, to stop the ERB from implementing its
order mandating a provisional increase in the prices of petroleum and petroleum products.

ISSUE/S:Whether or not the order of the ERB is valid? (YES)

HELD:
Senator Maceda and Atty. Lozano, in questioning the lack of a hearing, have overlooked the provisions
of Section 8 of Executive Order No. 172 which authorizes the Board to grant provisional relief on
motion of a party in the case or on its own initiative, without prejudice to a final decision after hearing,
should the Board find that the documentary evidences substantially support the provisional order.
Provided, That the Board shall immediately schedule and conduct a hearing thereon within thirty (30)
days thereafter, upon publication and notice to all affected parties. Section 3, paragraph (e) and
Section 8 do not negate each other, or otherwise, operate exclusively of the other, in that the Board
may resort to one but not to both at the same time. Section 3(e) outlines the jurisdiction of the Board
and the grounds for which it may decree a price adjustment, subject to the requirements of notice and
hearing. Pending that, however, it may order, under Section 8, an authority to increase provisionally,
without need of a hearing, subject to the final outcome of the proceeding.
 [2] US V. DORR
GR NO. 1051 | May 19, 1903 | Government | Mansilla

Petitioner: The United States

Respondent: Fred L. Dorr Et. Al.

Case Doctrine:People running the government is different from the government itself.

Facts: The defendants have been convicted upon a complaint based upon section 8 of Act No. 292 of
the Commission charging them with the offense of writing, publishing, and circulating a scurrilous libel
against the Government of the United States and the Insular Government of the Philippine Islands. The
alleged libel was published as an editorial in the issue of the "Manila Freedom" under the caption of " A
few hard facts." which is directed to the Civil Commission and the people running it.

Issue: Whether their publication constitutes an offense under section 8 of Act No. 292? (No)
What is the meaning of Government on the Act?

Held: The important question is to determine what is meant in section 8 of Act No. "92 by the
expression "the Insular Government of the Philippine Islands." Does it mean in a general and abstract
sense the existing laws and institutions of the Islands, or does it mean the aggregate of the individuals
by whom the Government of the Islands is, for the time being, administered? Either sense would
doubtless be admissible.

"We understand, in modern political science . . . by the term "government", that institution or aggregate
of institutions by which an independent society makes and carries out those rules of action which are
necessary to enable men to live in a social state, or which are imposed upon the people forming that
society by those who possess the power or authority of prescribing them. Government is the aggregate
of authorities which rule a society. By "administration" again, we understand in modern times, and
especially in more or less free countries, the aggregate of those persons in whose hands the reins of
government are for the time being (the chief ministers or heads of departments)." (Bouvier, Law
Dictionary, 891.) But the writer adds that the terms "government and ''administration" are not always
used in their strictness, and that "government" is often used for ''administration.''

In the act of Congress of July 14, 1798, commonly known as the "Sedition Act," it is made an offense to
"write, print, utter, or publish," or "cause to procure to be written, printed, uttered, or published," or to
"knowingly and willingly assist or aid in writing, printing, uttering, or publishing any false, scandalous,
and malicious writing or writings against the Government of the United States, or either house of the
Congress of the United States, or the President of the United States, with intent to defame the said
Government, or either house of the said Congress or the said President, or to bring-them, or either of
them, into contempt or disrepute, or to excite against them or either or any of them the hatred of the
good people of the United States," etc.

The term "government" would appeal to be used here in the abstract sense of the existing political
system, as distinguished from the concrete organisms of the Government — the houses of Congress
and the Executive — which are also specially mentioned.
The article in question contains no attack upon the governmental system of the United States, and it is
quite apparent that, though grossly abusive as respects both the Commission as a body and some of its
individual members, it contains no attack upon the governmental system by which the authority of the
United States is enforced in these Islands.
 [3] [Poindexter v. Greenhow]
114 U.S. 270| April 20, 1885 | Topic | J. Matthews | Paralejas

Petitioner: Pointdexter
Respondents: Samuel Greenhow

Case Doctrine: The state itself is an ideal person, intangible, invisible, immutable. The government is
an agent, and, within the sphere of the agency, a perfect representative; but outside of that, it is a
lawless usurpation. The constitution of the state is the limit of the authority of its government, and
both government and state are subject to the supremacy of the constitution of the United States, and
of the laws made in pursuance thereof.

FACTS: The plaintiff in error, who was also plaintiff below, brought his action in detinue on the twenty-
sixth day of April, 1883, against Samuel C. Greenhow, for the recovery of specific personal property, to-
wit, one office desk of the value of $30, before a police justice in the city of Richmond, who dismissed
the same for want of Jurisdiction. That the plaintiff was a resident of the city of Richmond, in the state
of Virginia; that he owed to the state of Virginia, for taxes on property owned by him in said city for the
year 1882, $12.45, which said t xes were due and leviable for, under the laws of Virginia

This the defendant, in the present case, undertook to do. He relied on the act of January 26, 1882,
requiring him to collect taxes in gold, silver, United States treasury notes, national bank currency, and
nothing else, and thus forbidding his receipt of coupons in lieu of money. That, it is true, is a legislative
act of the government of Virginia, but it is not a law of the state of Virginia.

ISSUE/S:Whether it was valid for a U.S. tax official to refuse coupons as tax payments despite being
allowed by the United States Constitution? (NO)

HELD:In the discussion of such questions, the distinction between the government of a state and the
state itself is important, and should be observed. In common speech and common apprehension they
are usually regarded as identical; and as ordinarily the acts of the government are the acts of the state,
because within the limits of its delegation of power, the government of the state is generally confounded
with the state itself, and often the former is meant when the latter is mentioned. The state itself is an
ideal person, intangible, invisible, immutable. The government is an agent, and, within the sphere of the
agency, a perfect representative; but outside of that, it is a lawless usurpation. The constitution of the
state is the limit of the authority of its government, and both government and state are subject to the
supremacy of the constitution of the United States, and of the laws made in pursuance thereof. So that,
while it is true in respect to the government of a state, as was said in Langford v. U. S. 101 U.S. 341 , that
the maxim, that the king can do no wrong, has no place in our system of government; yet it is also true,
in respect to the state itself, that whatever wrong is attempted in its name is imputable to its government,
and not to the state, for, as it can speak and act only by law, whatever it does say and do must be lawful.
That which, therefore, is unlawful because made so by the supreme law, the constitution of the United
States, is not the word or deed of the state, but is the mere wrong and trespass of those individual
persons who falsely speak and act in its name
 [5] [MCIA v. Marcos]
GR No. 120082| Sept 11, 1996 | Topic | Davide | Brubio

Petitioner: MACTAN CEBU INTERNATIONAL AIRPORT AUTHORITY (MCIAA)

Respondents: HON. FERDINAND J. MARCOS

Case Doctrine :

Even if it be conceded to be an "agency" or "instrumentality" of the Government, a taxable person for

such purpose in view of the withdrawal in the last paragraph of Section 234 of exemptions from the
payment of real property taxes, which, as earlier adverted to, applies to the petitioner.

FACTS:

MCIAA was created by Congress on July 31, 1990 under Republic Act No. 6958 to “undertake the
economical, efficient and effective control, management and supervision of the Mactan International
Airport in the Province of Cebu and the Lahug Airport in Cebu City... and such other airports as may be
established in the Province of Cebu.”

Since the time of its creation, petitioner MCIAA enjoyed the privilege of exemption from payment of
realty taxes in accordance with Sec 14 of its Charter. However, Mr. Eustaquio B. Cesa, Officer-in-charge,
Office of the Treasurer of the City of Cebu, demanded payment for realty taxes on several parcels of
land belonging to the petitioner in the total amount of Php 2,229,078.79.

MCIAA objected that the demand for payment was unjustified and baseless in accordance with Sec 14
of its Charter. It also asserted that it is an instrumentality of the government performing governmental
functions which puts limitations on the taxing powers of local government units.

Respondent City refused to withdraw the demands and asserted that MCIAA is not an instrumentality of
the government but merely a government-owned corporation performing proprietary functions. As such,
all exemptions previously granted to it were deemed withdrawn by operation of law, as provided under
Sections 193 and 234 of the Local Government Code when it took effect on January 1, 1992.

RTC dismissed the petition stating that the tax exemption provided for in RA 6958 creating petitioner
had been expressly repealed by the provisions of the New Local Government Code of 1991 and ordered
MCIAA to pay the assessed realty tax of its properties effective after January 1, 1992 until the present.

ISSUE/S:Whether MCIAA is liable to pay Real Property Tax? (Yes)

HELD:The Court ruled that an "agency" of the Government refers to "any of the various units of the
Government, including a department, bureau, office, instrumentality, or government owned or
controlled corporation, or a local government or a distinct unit therein;" while an "instrumentality" refers
to "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. This term
includes regulatory agencies, chartered institutions and government-owned and controlled
corporations."

If Section 234(a) intended to extend the exception therein to the withdrawal of the exemption from
payment of real property taxes under the last sentence of the said section to the agencies and
instrumentalities of the National Government mentioned in Section 133(o), then it should have restated
the wording of the latter. Yet, it did not. Moreover, that Congress did not wish to expand the scope of the
exemption in Section 234(a) to include real property owned by other instrumentalities or agencies of the
government including government-owned and controlled corporations is further borne out by the fact
that the source of this exemption is Section 40(a) of P.D. No. 464, otherwise known as The Real Property
Tax Code, which reads:

SEC. 40. Exemptions from Real Property Tax . — The exemption shall be as follows:
(a) Real property owned by the Republic of the Philippines or any of its political subdivisions and any
government-owned or controlled corporation so exempt by its charter: Provided, however, That this
exemption shall not apply to real property of the above-mentioned entities the beneficial use of which has
been granted, for consideration or otherwise, to a taxable person.

The crucial issues then to be addressed are: (a) whether the parcels of land in question belong to the
Republic of the Philippines whose beneficial use has been granted to the petitioner, and (b) whether the
petitioner is a "taxable person."

The transfer stated in Sec 15 of MCIAA’s charter is actually an absolute conveyance of the ownership
thereof because the petitioner's authorized capital stock consists of, inter alia, "the value of such real
estate owned and/or administered by the airports." Hence, the petitioner is now the owner of the land in
question and the exception in Section 234(c) of the LGC is inapplicable.

Moreover, the petitioner cannot claim that it was never a "taxable person" under its Charter. It was only
exempted from the payment of real property taxes. The grant of the privilege only in respect of this tax
is conclusive proof of the legislative intent to make it a taxable person subject to all taxes, except real
property tax.

Finally, even if the petitioner was originally not a taxable person for purposes of real property tax, in light
of the foregoing disquisitions, it had already become, even if it be conceded to be an "agency" or
"instrumentality" of the Government, a taxable person for such purpose in view of the withdrawal in the
last paragraph of Section 234 of exemptions from the payment of real property taxes, which, as earlier
adverted to,applies to the petitioner.

[6] [MIAA v. Court of Appeals]

 G.R. No. 155650 | July 20, 2006 | Administrative Agencies |CARPIO, J.| Almase

Petitioner: MANILA INTERNATIONAL AIRPORT AUTHORITY

Respondents: COURT OF APPEALS, CITY OF PARAÑAQUE, CITY MAYOR OF PARAÑAQUE,

SANGGUNIANG PANGLUNGSOD NG PARAÑAQUE, CITY ASSESSOR OF PARAÑAQUE, and CITY
TREASURER OF PARAÑAQUE

Case Doctrine :Under Section 2(10) and (13) of the Introductory Provisions of the Administrative Code,
which governs the legal relation and status of government units, agencies and offices within the entire
government machinery, MIAA is a government instrumentality and not a government-owned or
controlled corporation. Under Section 133(o) of the Local Government Code, MIAA as a government
instrumentality is not a taxable person because it is not subject to "[t]axes, fees or charges of any kind"
by local governments. The only exception is when MIAA leases its real property to a "taxable person"
as provided in Section 234(a) of the Local Government Code, in which case the speciBc real property
leased becomes subject to real estate tax. Thus, only portions of the Airport Lands and Buildings
leased to taxable persons like private parties are subject to real estate tax by the City of Parañaque.

FACTS:Petitioner Manila International Airport Authority (MIAA) operates the Ninoy Aquino
International Airport (NAIA) Complex in Parañaque City under Executive Order No. 903, otherwise
known as the Revised Charter of the Manila International Airport Authority ("MIAA Charter"). Executive
Order No. 903 was issued on 21 July 1983 by then President Ferdinand E. Marcos. Subsequently,
Executive Order Nos. 909 1 and 298 2 amended the MIAA Charter.

On 21 March 1997, the Office of the Government Corporate Counsel (OGCC) issued Opinion No.061.
The OGCC opined that the Local Government Code of 1991 withdrew the exemption from real estate
tax granted to MIAA under Section 21 of the MIAA Charter. Thus, MIAA negotiated with respondent
City of Parañaque to pay the real estate tax imposed by the City. MIAA then paid some of the real estate
tax already due.

As operator of the international airport, MIAA administers the land, improvements and equipment
within the NAIA Complex. The MIAA Charter transferred to MIAA approximately 600 hectares of land,
including the runways and buildings ("Airport Lands and Buildings") then under the Bureau of Air
Transportation. The MIAA Charter further provides that no portion of the land transferred to MIAA shall
be disposed of through sale or any other mode unless specifically approved by the President of the
Philippines.

On 28 June 2001, MIAA received Final Notices of Real Estate Tax Delinquency from the City of
Parañaque for the taxable years 1992 to 2001. On 17 July 2001, the City of Parañaque, through its City
Treasurer, issued notices of levy and warrants of levy on the Airport Lands and Buildings. The Mayor
of the City of Parañaque threatened to sell at public auction the Airport Lands and Buildings should
MIAA fail to pay the real estate tax delinquency. MIAA thus sought a clarification of OGCC Opinion No.
061.

The petitioner (MIAA) points out that Section 21 of the MIAA Charter specifically exempts MIAA from
the payment of real estate tax. MIAA insists that it is also exempt from real estate tax under Section 234
of the Local Government Code because the Airport Lands and Buildings are owned by the Republic. To
justify the exemption, MIAA invokes the principle that the government cannot tax itself. MIAA points out
that the reason for tax exemption of public property is that its taxation would not inure to any public
advantage, since in such a case the tax debtor is also the tax creditor.

Respondents invoke Section 193 of the Local Government Code, which expressly withdrew the tax
exemption privileges of "government-owned and-controlled corporations" upon the effectivity of the
Local Government Code. Respondents also argue that a basic rule of statutory construction is that the
express mention of one person, thing, or act excludes all others. An international airport is not among
the exceptions mentioned in Section 193 of the Local Government Code. Thus, respondents assert that
MIAA cannot claim that the Airport Lands and Buildings are exempt from real estate tax.

ISSUE/S:

Whether or not MIAA is an instrumentality of the government and not a government owned and
controlled corporation and as such exempted from tax. (NO)

HELD:

We rule that MIAA's Airport Lands and Buildings are exempt from real estate tax imposed by local
governments. First, MIAA is not a government-owned or controlled corporation but an instrumentality
of the National Government and thus exempt from local taxation. Second, the real properties of MIAA
are owned by the Republic of the Philippines and thus exempt from real estate tax.

A government-owned or controlled corporation must be "organized as a stock or non-stock corporation."

MIAA is not organized as a stock or non-stock corporation. MIAA is not a stock corporation because it
has no capital stock divided into shares. MIAA has no stockholders or voting shares. MIAA is also not
a non-stock corporation because it has no members. The Airport Lands and Buildings of MIAA are
property of public dominion and therefore owned by the State or the Republic of the Philippines.

Under Section 2(10) and (13) of the Introductory Provisions of the Administrative Code, which governs
the legal relation and status of government units, agencies and offices within the entire government
machinery, MIAA is a government instrumentality and not a government-owned or controlled
corporation. Under Section 133(o) of the Local Government Code, MIAA as a government instrumentality
is not a taxable person because it is not subject to "[t]axes, fees or charges of any kind" by local
governments. The only exception is when MIAA leases its real property to a "taxable person" as provided
in Section 234(a) of the Local Government Code, in which case the speciBc real property leased
becomes subject to real estate tax. Thus, only portions of the Airport Lands and Buildings leased to
taxable persons like private parties are subject to real estate tax by the City of Parañaque.

[7] [MIAA v. City of Pasay]

 G.R. No. 163072| April, 2, 2009 | Government-Owned or Controlled Corporation; Government
Instrumentalities | CARPIO, J. | FERAREN

Petitioner: Manila International Airport Authority (MIAA)

Respondents: City of Pasay

Case Doctrine :
- A Government Owned or Controlled Corporation is Organized as a Stock or Non-stock
Corporation. In this case, MIAA is neither a Stock or Non-Stock Corporation but instead it is a
government instrumentality.
- The term government ‘instrumentality’ is broader than the term ‘government-owned or
controlled corporation.’ The fact that the two terms have separate definitions means that
while a government ‘instrumentality’ may include a ‘government-owned or controlled
corporation,’ there may be a government ‘instrumentality’ that will not qualify as a
‘government-owned or controlled corporation’.
- Government Instrumentalities are exempted from real property tax.

FACTS:
- Manila International Airport Authority (MIAA) operates and administers the Ninoy Aquino
International Airport (NAIA) Complex under EO No. 903. Under the EO, approximately 600
hectares of land, including the runaways, the airport tower, and other airport buildings, were
transferred to MIAA.
- In August 2001, MIAA received Final Notices of Real Property Tax Delinquency from the City of
Pasay for the taxable years of 1992 to 2001.
- The City of Pasay, through its City Treasurer, issued notices of levy and warrants for the NAIA
Pasay properties, the City threatened to sell these properties at public auction if the taxes
remained unpaid.
- MIAA filed a petition with the Court of Appeals which sought to enjoin the City of Pasay from
imposing real property taxes on, levying against, and auctioning for public sale the NAIA Pasay
properties.
- The CA dismissed the petition and upheld the power of the City of Pasay to impose and collect
realty taxes on the NAIA Pasay properties. It argued that the Local Government Code which took
effect on January 1 1992, withdrew the exemption from payment of real property taxes to
government-owned or controlled corporations. Since MIAA is a government-owned corporation,
it follows that its tax exemption under Section 21 of EO 903 has been withdrawn upon effectivity
of the Local Government Code.

ISSUE/S:
(1) Whether or not Manila International Airport Authority (MIAA) is a government-owned or controlled
corporation.
(2) Whether or not MIAA is exempted to pay real property tax.

HELD:
 (1) MIAA is not a government-owned and controlled corporation. As discussed in the 2006 MIAA case,
A government owned or controlled corporation must be “ organized as a stock or non-stock corporation.
MIAA is not a stock corporation because it has no capital stock divided into shares. MIAA has no
stockholders or voting shares.

- MIAA is also not a non-stock corporation because it has no members. According to the Corporation
Code, a non-stock corporation is “ one where no part of its income is distributable as dividends to its
members, trustees or officers' ' A non- stock corporation must have members.

- MIAA is a government instrumentality vested with corporate powers to perform efficiently its
governmental functions. When the law vests in a government instrumentality corporate powers, the
instrumentality does not become a corporation. Unless the government instrumentality is organized
as a stock or non-stock corporation. MIAA exercises the governmental powers of eminent domain,
police authority and the levying of fees and charges. At the same time, MIAA exercises, “all powers of
a corporation under the Corporation Law.”

(2) Yes, MIAA is exempted to pay real property tax. Since MIAA is a government instrumentality it is
exempted from any kind of tax from the local government. Under the Local Government Code, “ local
government units have no power to tax instrumentalities of the national government like the MIAA.
Hence, MIAA is not liable to pay real property tax for the NAIA Pasay properties.

Furthermore, the airport lands and buildings of MIAA are properties of public dominion intended for public
use, and such are exempt from real property tax under the Local Government Code.
 [8] [MCIAA vs City of Lapu-Lapu]
GR No. 181756| June 15, 2015 | Government Instrumentality | Leonardo-De Castro, J | Aguinaldo

Petitioner: Mactan-Cebu International Airport Authority (MCIAA)

Respondents: City of Lapu-Lapu and Elena T. Pacaldo

Case Doctrine : When the law vests in a government instrumentality corporate powers, the
instrumentality does not become a corporation. Unless the government instrumentality is organized as
a stock or non-stock corporation, it remains a government instrumentality exercising not only
governmental but also corporate powers.

FACTS:
Petitioner enjoyed exemption from realty taxes under the provisions of Republic Act No. 6958. However,
the Court rendered a decision in MCIAA vs Marcos (the 1996 MCIAA Case) declaring that upon the
effectivity of RA No. 7160 (The Local Government Code of 1991), the petitioner was no longer exempt
from real estate taxes. Therefore, respondent City issued to petitioner a Statement of Real Estate Tax
assessing the lots comprising the Mactan International Airport. Petitioner paid the respondent City a
total of 275,728,313.36. Respondent City Treasurer Elena T. Pacaldo sent petitioner a Statement of Real
property Tax Balances up to the year 2002. Petitioner claimed that the statement again included the lots
utilized solely and exclusively for public purpose such as the airfield, runway, and taxiway and the lots
on which these are built.

ISSUE/S:
1. Whether or not the petitioner is a government instrumentality (YES)
2. Whether or not the local government units have the power to collect real property taxes from
airport authorities located within their area (NO)

HELD:The petitioner is an instrumentality of the government; thus, its properties actually, solely and
exclusively used for public purposes, consisting of the airport terminal building, airfield, runway, taxiway
and the lots on which they are situated, are not subject to real property tax and respondent City is not
justified in collecting taxes from petitioner over said properties.
Petitioner MCIAA, with its many similarities to the MIAA, should be classified as a government
instrumentality, as its properties are being used for public purposes, and should be exempt from real
estate taxes. This is not to derogate in any way the delegated authority of local government units to
collect realty taxes, but to uphold the fundamental doctrines of uniformity in taxation and equal
protection of the laws, by applying all the jurisprudence that have exempted from said taxes similar
authorities, agencies, and instrumentalities, whether covered by the 2006 MIAA ruling or not.
Petitioner MCIAA is vested with corporate powers but it is not a stock or non-stock corporation,
which is a necessary condition before an agency or instrumentality is deemed a government-owned or
controlled corporation. Like MIAA, petitioner MCIAA has capital under its charter but it is not divided into
shares of stock. It also has no stockholders or voting shares.
 [9] LRTA V. QUEZON CITY
GR NO. 221626| October 9, 2019 | GOCC / Government Instrumentality | Merle

Petitioners: Light Rail Transit Authority

Respondents: Quezon City represented by City Treasurer and City Assessor

Case Doctrine: 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.

Facts: Pursuant to Executive Order No. 603 3 (EO 603) dated July 12, 1980, the Light Rail Transit
Authority (LRTA) was created primarily to construct, operate, maintain, and/or lease the light rail
transit system of the country. For this purpose, the LRTA acquired real properties and commenced its
operations in 1984.

On October 15, 2007, the LRTA received several Statements of Delinquency and Final Notices of Tax
Delinquency, this time, from respondent Quezon City. By letter dated October 15, 2007, the LRTA
informed Quezon City that pursuant to the subsequent case of MIAA v. Court of Appeals, the LRTA is a
government instrumentality, thus, exempt from real property tax. Through the Office of the City
Treasurer, Quezon City issued warrants of levy on the LRTA's properties on which realty taxes had not
been paid. In December 2007, Quezon City auctioned the affected LRTA properties. But for lack of any
interested bidder, these properties were instead sold to Quezon City pursuant to Sec. 263 of RA 7610.
Meantime, the LRTA's right of redemption expired on April 4, 2011. 13 It thus filed a petition for certiorari,
prohibition and injunction against Quezon City before the Regional Trial Court.

Issues:
1. Is the LRTA a GOCC or a government instrumentality; (government instrumentality) and
2. Are the LRTA's properties subject to real property tax? (no)

Held: Section 234 of the Local Government Code (LGC) has withdrawn the previous real property tax
exemptions granted to natural or juridical persons, including government-owned or controlled
corporations, except as otherwise provided therein. The law ordains that only real properties owned by
the Republic of the Philippines or any of its political subdivisions are exempt from real property tax.

The LRTA is not a government-owned and controlled corporation (GOCC).

Indeed, an agency is a government-owned or controlled corporation when it is organized as a stock or

non-stock corporation. Consequently, to be considered as a GOCC, an entity must either be organized
as a stock or non-stock corporation. Three (3) requisites must concur for one to be classified as a
stock corporation, viz.: (1) it has capital stock, (2) the capital stock is divided into shares, and (3) it is
authorized to distribute dividends and allotments of surplus and profits to its stockholders. As for non-
stock corporations, they must have members and must not distribute any part of their income to said
members.

Section 15 of the LRTA's Charter 25 decrees:

 Sec. 15. Capitalization. — The Authority shall have an authorized capital of FIVE HUNDRED
MILLION PESOS (P500,000,000.00) which shall be fully subscribed by the Republic of the
Philippines and other government institutions, corporations, instrumentalities, and agencies,
whether national or local, within the framework of their respective charters.

The LRTA has statutory capital — but not capital stock or share capital. The wording of its capital
structure is similar to that of the Manila International Airport Authority (MIAA).
Under their respective Charters, both the LRTA and the MIAA do not have capital stock that is divided
into shares. To repeat, Section 3 of the Corporation Code defines a stock corporation as one whose
"capital stock is divided into shares and x x x authorized to distribute to the holders of such dividends x
x x." The LRTA and the MIAA have capital but it is not a capital stock or share capital, which is not
divided into shares of stock. Neither of them has stockholders nor voting shares. Hence, the LRTA —
as the MIAA — is not a stock corporation.

The LRTA is also not a non-stock corporation because it has no members. Section 87 of the
Corporation Code defines a non-stock corporation as "one where no part of its income is distributable
as dividends to its members, trustees or oficers." A non-stock corporation must have members. Even if
we assume that the government is considered as the sole member of the LRTA, this will not make the
LRTA a non-stock corporation. Section 88 of the Corporation Code provides that non-stock
corporations are "organized for charitable, religious, educational, professional, cultural, recreational,
fraternal, literary, scientific, social, civil service, or similar purposes, like trade, industry, agriculture and
like chambers." The LRTA is not organized for any of these purposes. As a public utility, it is organized
to operate the light rail transit system for public use.

The LRTA is a government instrumentality exercising corporate powers.

Notably, what is defined in the Administrative Code of 1987 is an "instrumentality." 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.

This classification was eventually adopted in Executive Order No. 596 (EO 596) which was enacted into
law on December 29, 2006. It acknowledged the third classification of a government agency in addition
to GOCCs and instrumentalities, viz.: government instrumentalities vested with corporate powers and
named as "government corporate entities" (GCE). EO 596 includes GCEs within the jurisdiction of the
Office of the Government Corporate Counsel (OGCC). In 2011, RA No. 10149, the GOCC Governance Act
of 2011 was passed into law adopting such new category under EO 596: Government Instrumentalities
with Corporate Powers (GICP)/Government Corporate Entities (GCE). Thus, the classification of
Government Instrumentalities with Corporate Powers (GICP)/Government Corporate Entities is now
officially recognized.

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.

The characterization of government instrumentality is not lost where the government entity possesses
corporate status. These are not polar opposites. This is so especially when, despite the corporate status,
it is really the resources and reputation of the Republic for a paramount public purpose that are at stake
in the capitalization and operations of the government entity. Here, the LRTA bears the elemental
characteristics of a government instrumentality vested with corporate powers . Consider:

1. The vesture of its corporate powers is found in Article 2 of Executive Order 603
SEC. 4. General Powers. — The Authority, through the Board of Directors, may undertake such
actions as are expedient for or conducive to the attainment of the purposes and objectives of
the Authority, or of any purpose reasonably incidental to or consequential upon any of these
purposes. x x x.
2. 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.
3. 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.

The next inquiry hinges on the tax-exempt status of government instrumentalities vested with
corporate powers.

In sum, a government instrumentality though vested with corporate powers are exempt from real
property tax, but the exemption shall not extend to taxable private entities to whom the beneficial use of
the government instrumentality's properties has been vested. The taxable private entities are subject to
real property tax, but not the government instrumentality they have dealt with, much less, the properties
of the government instrumentality subject of such beneficial use.

The LRTA operations and properties of public dominion are devoted to public use and public welfare,
hence, are owned by the Republic of the Philippines, and for legal and socially significant reasons, are
exempt from real property taxes and the means to collect such taxes. To be sure, the LRTA and its
properties are tasked to establish the light rail transit in the country. To pursue this mandate and
purpose, the LRTA pioneered the construction of light rail transit infrastructure, which was financed
through foreign loans. The revenues from the LRTA operations were designed to pay for the loans
incurred for its construction. The LRTA operations were intended as a public utility rather than as a profit-
making mechanism.
 [10] [Philippine Heart Center v QC]

G.R. No. 225409 | March 11, 2020 | Administrative Agencies | Lazaro-Javier | Hidalgo, Carlos

Petitioner: Philippine Heart Center

Respondents: Local government of QC, City Mayor of QC, City treasurer of QC, City Assessor of QC

Case Doctrine: The PHC is a government instrumentality with corporate powers exempt from local
taxes. Local governments cannot tax the national government. 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. 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

FACTS: The Philippine Heart Center was established under PD 673 mandated to provide cardiovascular
care to the general public, Under the Decree, the heart center was authorize to acquire property, enter
into contracts, and to encumber its properties, and is exempted from payment of taxes imposed by
government or any political subdivision or instrumentality for a period of 10 years. Pres. Marcos issued
a letter of instruction extending the tax exemption “without interruption”.

The QC Government issued final notices of delinquency for unpaid RPT of 11 properties owned by the
Heart center. The heart center and the QC government entered into a MOA where the center agreed to
provide free medical services to qualified residents of QC until the monetary equivalent of the free
service was enough to cover the RPT liability. The Heart Center became aware of MIAA v CA which
states that government entities are exempt from taxes imposed by a LGU.

QC claims that they the center is still liable for RPT since the heart center was leasing its properties to
private individuals such as Jollibee, and Chowking. The properties were levied and sold to the QC
government as the highest bidder. PHC filed petition of certiorari to the CA stating grave abuse of
discretion claiming its properties were used for charitable purposes and as charitable institution, it is
exempt from tax. CA DISMISSED the case stating failure of PHC to exhaust all administrative remedies
under section 252 of RA 7160 where no protest shall be entertained unless the taxpayer first pays the
tax. PHC counters that there are exemptions to exhausting of administrative remedies since the tax is
patently illegal, and they are raising a pure question of law.

PHC reiterates its claim for exemption from real property taxes pursuant to PD 673 and LOI 1455. It also
argues that under Article III, Section 28 (3) of the 1987 Constitution 33 and Section 234 (b) of RA 7160,
charitable institutions are exempt from paying real property taxes on its properties which are being
actually, directly, and exclusively being used for charitable purposes.

ISSUE/S:

Whether or not the Philippine Heart Center is a government instrumentality vested with corporate
powers(YES)

Whether or not the Philippine Heart Center is exempt from paying RPT on its 11 properties in QC(YES)
HELD:

The Local Government Code Provides that the exercise of the taxing powers of provinces, cities,
municipalities, and barangays shall not extend to the levy of the following: (o) Taxes, fees or charges
of any kind on the National Government, its agencies and instrumentalities and local government units.
Section 234 (a) of RA 7160 further exempts real property owned by the Republic from real property taxes:
Real property owned by the Republic of the Philippines or any of its political subdivisions except when
the beneficial use thereof has been granted, for consideration or otherwise, to a taxable person. When
the law vests in a government instrumentality corporate powers, the instrumentality does not become
a corporation. Unless the government instrumentality is organized as a stock or non-stock corporation,
it remains a government instrumentality exercising not only governmental but also corporate powers.

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. respondents also failed to show that the taxable lessees were
validly served notices of assessments covering the properties purportedly leased out by the PHC.
Otherwise stated, local government units are precluded from availing of the remedy of levy against
properties owned by government instrumentalities, whether or not vested with corporate powers, such
as the PHC.
 [11] [De la Llana vs. Alba]
GR No. 57883 | March 12, 1982 | Administrative Agencies | Fernando CJ| Maningo

Petitioner: GUALBERTO J. DE LA LLANA, Presiding Judge, Branch II of the City Court of Olongapo,
ESTANISLAO L. CESA, JR., FIDELA Y. VARGAS, BENJAMIN C. ESCOLANGO, JUANITO C. ATIENZA,
MANUEL REYES ROSAPAPAN, JR., VIRGILIO E. ACIERTO, and PORFIRIO AGUILLON AGUILA

Respondents: MANUEL ALBA, Minister of Budget, FRANCISCO TANTUITCO, Chairman, Commission on

Audit, and RICARDO PUNO, Minister of Justice

Case Doctrine:Removal is distinguished from termination by virtue of the abolition of office. After
abolition of office, there is in law no occupant, while in removal, there is an occupant who could lose his
position. THIS IS AN ISSUE OF ABOLITION OF OFFICE. In this case, the question of security of tenure
does not arise. In the case of abolition of an inferior court, there is no difference between removal and
abolition of office.

No removal or separation of petitioners from the service is here involved, but the validity of the abolition
of their offices. This is a legal issue that is for the Courts to decide. It is well-known rule also that valid
abolition of offices is neither removal nor separation of the incumbents. And, of course, if the abolition
is void, the incumbent is deemed never to have ceased to hold office. As well- settled as the rule that
the abolition of an office does not amount to an illegal removal of its incumbent is the principle that, in
order to be valid, the abolition must be made in good faith.

FACTS:BP 129 was enacted, titled “An Act Reorganizing the Judiciary, Appropriating Funds therefor and
for Other Purposes”, the same being contrary to the security of tenure provision of the Constitution as it
separates from the judiciary Justices and judges of inferior courts from the Court of Appeals to
municipal circuit courts except the occupants of the Sandiganbayan and the Court of Tax Appeals,
unless appointed to the inferior courts established by such Act.
De la Llana is a judge that would be removed from his position because of the law, hence, he assailed
the validity of this law, because it goes against the constitutional provision on the security of tenure of
incumbent justices and judges.

The Solicitor General pointed out that there is no valid justification for the attack on the constitutionality
of the statute, it being a legitimate exercise of the power vested in the Batasang Pambansa to reorganize
the judiciary.

ISSUE/S: Whether or not Batas Pambansa Blg 129 is unconstitutional for colliding with the security of
tenure enjoyed by judges and justices. (NO)

HELD:The Court held that the unconstitutionality of Batas Pambansa Blg. 129 not having been shown.
It held that the enactment thereof was in answer to a pressing and urgent need for a major
reorganization of the judiciary.

It is a fundamental proposition that the legislature may abolish courts inferior to the Supreme Court and
therefore may reorganize them territorially or otherwise thereby necessitating new appointments and
commissions. To be specific, the Batasang Pambansa is expressly vested with the authority to
reorganize inferior courts and in the process to abolish existing ones. As in this case, the Court also held
that no removal or separation of petitioners from service is here involved, but the validity of the abolition
of their offices. It is well-known rule also that valid abolition of offices is neither removal nor separation
of the incumbents.

Removal is to be distinguished from termination by virtue of valid abolition of the office. There can be
no tenure to a non-existent office. After the abolition, there is in law no occupant. In case of removal,
there is an office with an occupant who would thereby lose his position. It is in that sense that from
the standpoint of strict law, the question of any impairment of security of tenure does not arise.

In the case of abolition of an inferior court (as in the case at bar), there is no difference between
removal and abolition of office.

In the choice of alternatives between two constructions where one would save and another would
invalidate a statute, the former is to be preferred.

The Batasang Pambansa has express authority to reorganize inferior courts and in the process to
abolish existing ones.

In case of removal, there is an office with an occupant who would thereby lose his position. It is in that
sense that from the stand- point of strict law, the question of any impairment of security of tenure does
not arise. Nonetheless, for the incumbents of 'Inferior Courts abolished, the effect is one of separation.
As to its effect, no distinction exists between removal and the abolition of the office.
 [12] [Canonizado v. Aguirre]
G.R. 133132 | January 25, 2000 | Administrative Agencies | Gonzaga-Reyes, J. | Navarro

Petitioner: Alexis C. Canonizado, Edgar Dula Torres, and Rogelio A. Pureza

Respondents: HON.ANDER P. AGUIRRE, as Executive Secretary, HON. EMILIA T. BONCODIN, as
Secretary of Budget and Management, JOSE PERCIVAL L. ADIONG, ROMEO L. CAIRME and VIRGINIA
U. CRISTOBAL

Case Doctrine : Under RA 6975, the NAPOLCOM was described as a collegial body within the DILG.
Whereas, RA 8551 made it an agency attached to the department for policy and program
coordination. This does not result to a creation of a new office.

FACTS:
Petitioners were duly appointed Commissioners of the National Police Commission (NAPOLCOM) –
created by virtue of RA 6975. Upon the passing of the amendatory law, RA 8851 a.k.a "Philippine
National Police Reform and Reorganization Act of 1998," it declared that the terms of the current
Commissioners were deemed as expired upon its effectivity.
Petitioners assail the constitutionality of sections 4 and 8 of RA 8551. Petitioners argue that their
removal from office by virtue of section 8 of RA 8551 violates their constitutionally guaranteed right to
security of tenure.

Public respondents insist that the express declaration in section 8 of RA 8551 that the terms of
petitioners offices are deemed expired discloses the legislative intent to impliedly abolish the
NAPOLCOM created under RA 6975 pursuant to a bona fide reorganization. Petitioners posit the theory
that the abolition of petitioners offices was a result of a reorganization of the NAPOLCOM allegedly
effected by RA 8551.

ISSUE/S:
1. WHETHER OR NOT petitioners were removed by virtue of a valid abolition of their office by
Congress. - NO

2. WHETHER OR NOT sections 4 and 8 are unconstitutional. - Yes

HELD:
1. Petitioners were not removed by virtue of a valid abolition of their office by Congress. First of
all, RA 8551 did not expressly abolish petitioners positions. “Public respondents would have this
Court believe that RA 8551 reorganized the NAPOLCOM resulting in the abolition of petitioners
offices. We hold that there has been absolutely no attempt by Congress to effect such a
reorganization…No bona fide reorganization of the NAPOLCOM having been mandated by
Congress, RA 8551, insofar as it declares the terms of office of the incumbent Commissioners,
petitioners herein, as expired and resulting in their removal from office, removes civil service
employees from office without legal cause and must therefore be struck down for being
constitutionally infirm.”
2. In the dispositive portion of the decision, the Court granted the petition “but only to the extent of
declaring section 8 of RA 8551 unconstitutional for being in violation of the petitioners right to
security of tenure. The removal from office of petitioners as a result of the application of such
unconstitutional provision of law and the appointment of new Commissioners in their stead is
therefore null and void.”

PETITION GRANTED. PETITIONERS ARE REINSTATED.

 [13] KAPISANAN v. BARIN
G.R. 150974 | June 29, 2007 | Abolition of Agency | Carpio, J. | Bernardino

Petitioner: KAPISANAN NG MGA KAWANI NG ENERGY REGULATORY BOARD

Respondents: COMMISSIONER FE B. BARIN, DEPUTY COMMISSIONERS CARLOS R. ALINDADA,

LETICIA V. IBAY, OLIVER B. BUTALID, and MARY ANNE B. COLAYCO, of the ENERGY REGULATORY
COMMISSION

Case Doctrine:
➔ The power to create an office carries with it the power to abolish.
➔ A valid order of abolition must not only come from a legitimate body, it must also be made in
good faith. An abolition is made in good faith when it is not made for political or personal
reasons, or when it does not circumvent the constitutional security of tenure of civil service
employees. Abolition of an office may be brought about by reasons of economy, or to remove
redundancy of functions, or a clear and explicit constitutional mandate for such termination of
employment. Where one office is abolished and replaced with another office vested with similar
functions, the abolition is a legal nullity. When there is a void abolition, the incumbent is deemed
to have never ceased holding office.

FACTS:RA 9136, popularly known as EPIRA (Electric Power Reform Act of 2001) provides the abolition
of ERB and the creation of ERC. In the guidelines issued by the Commissioners of the ERC for the
selection and hiring employes vis-a-vis Civil Service provides that since RA 9136 abolished ERB, it is the
view of the Commission that the provisions of RA 6656 will not directly apply to ERC’s current efforts to
establish a new organization. However, civil service laws, rules and regulations will have suppletory
application to the extent possible in regard to the selection and placement of employees in ERC. The
members of KERB raised their objection to the Commissioners’ stand and asserted that RA 9136 did not
abolish ERB or change ERB’s character as an economic regulator of the electric power industry. KERB
insisted that RA 9136 merely changed ERB’s name to ERC and expanded ERB’s functions and objectives.
Despite the request of KERB, ERC posted the plantilla positions, which prescribe higher standards, as
approved by DBM. The Commissioner stated that positions in ERC do not need the prior approval of
CSC, as ERC is only required to submit the qualification standards to CSC. KERB filed the present petition
because of the fearful uncertainty of the employment status of its members.

ISSUE/S:Whether or not there was a valid abolition of the ERB. → YES

HELD:There was a valid abolition of the ERB because of the expansion of the ERC’s functions and
concerns. In comparing the functions of ERB and ERC, it is evident that the ERC assumed the functions
of ERB. The overlap in the functions of ERB and of ERC does not mean that there is no valid abolition
of ERB. The ERC has new and expanded functions which are intended to meet the specific needs of a
deregulated power industry. Throughout the years, the scope of the regulation has gradually narrowed
from that of public services in 1902 to the electricity industry and water resources in 1972 to the
electric power industry and oil industry in 1977 to the electric industry alone in 1998. The ERC retains
ERB’s traditional rate and service regulation functions. However, the ERC now has to promote
competitive operations in the electricity market. RA 9136 expanded the ERC’s concerns to encompass
both the consumers and the utility investors.The law created ERC in place of ERC in tandem with the
restructuring of the industry to “a strong and purely independent regulatory body.” Hence, there is a
valid abolition of the ERB which means that there is no merit to KERB’s allegation that there is an
impairment of the security of tenure of ERB’s employees.
 [14] Crisostomo vs CA
106269| 7/15/96 | Administrative Agencies | Mendoza | Delos Reyes

Petitioner: ISABELO T. CRISOSTOMO

Respondents: THE COURT OF APPEALS and the PEOPLE OF THE PHILIPPINES

Case Doctrine :
New course offerings can be added to the curriculum of a school without affecting its legal existence.
Nor will changes in its existing structure and organization bring about its abolition and the creation of a
new one. Only an express declaration to that effect by the lawmaking authority will.

FACTS:
Isabelo Crisostomo was President of the Philippine College of Commerce (PCC). During his incumbency
two administrative cases were filed against petitioner for illegal use of government vehicles,
misappropriation of construction materials belonging to the college, oppression and harassment, grave
misconduct, nepotism and dishonesty.

The informations alleged that he appropriated for himself a bahay kubo, which was intended for the
College, and construction materials worth P250,000.00, more or less. Petitioner was also accused of
using a driver of the College as his personal and family driver.

As a result, he was preventively suspended from office. In his place Dr. Pablo T. Mateo, Jr. was
designated as officer-in-charge.

P.D. No. 1341 was issued by then President Ferdinand E. Marcos, CONVERTING THE PHILIPPINE
COLLEGE OF COMMERCE INTO A POLYTECHNIC UNIVERSITY. Mateo continued as the head of the new
University. He was appointed Acting President, and then as President for a term of six (6) years.

Circuit Criminal Court of Manila rendered judgment acquitting petitioner of the charges against him. The
cases filed before the Ombudsman were dismissed on the ground that they had become moot and
academic. On the other hand, the administrative cases were dismissed for failure of the complainants
to prosecute them.

Crisostomo filed with the RTC a motion for execution of the judgment, ordering his reinstatement to the
position of president of the PUP and the payment of his salaries and other benefits during the period of
suspension, which was granted. However, President Corazon C. Aquino appointed Dr. Jaime Gellor as
acting president of the PUP, following the expiration of the term of office of Dr. Nemesio (president
before Gellor)

RTC issued another order, reiterating earlier order for the reinstatement of petitioner to the position of
PUP president. Sheriff stated that he had executed the writ by installing petitioner as President of the
PUP, although Dr. Gellor did not vacate the office as he wanted to consult with the President of the
Philippines first.

This led to a contempt citation against Dr. Gellor. People of the Philippines filed a petition for certiorari
and prohibition assailing the two orders and the writs of execution issued by the trial court. It also asked
for a temporary restraining order.
Court of Appeals issued a temporary restraining order, enjoining petitioner to cease and desist from
acting as president of the PUP, and enjoining further proceedings in Criminal Cases

Hence this petition. Petitioner argues that P.D. No. 1341, which converted the PCC into the PUP, did not
abolish the PCC. He contends that if the law had intended the PCC to lose its existence, it would have
specified that the PCC was being "abolished" rather than "converted" and that if the PUP was intended
to be a new institution, the law would have said it was being "created." Petitioner claims that the PUP is
merely a continuation of the existence of the PCC, and, hence, he could be reinstated to his former
position as president.

ISSUE/S:
W/N PCC’s conversion abolished it → NO

HELD:
P.D. No. 1341 did not abolish, but only changed, the former Philippine College of Commerce into what
is now the Polytechnic University of the Philippines

What took place was a change in academic status of the educational institution, not in its corporate
life. Hence the change in its name, the expansion of its curricular offerings, and the changes in its
structure and organization.

The appellate court ruled, however, that the PUP and the PCC are not "one and the same institution"
but "two different entities" and that since petitioner Crisostomo's term was coterminous with the legal
existence of the PCC, petitioner's term expired upon the abolition of the PCC.

The PD explicitly provides that PUP's objectives and purposes cover not only PCC's offering of
programs "in the field of commerce and business administration" but also "programs in other
polytechnic areas" and "in other fields such as agriculture, arts and trades and fisheries . . ."

PUP was conceived as a bigger institution absorbing, merging and integrating the entire PCC and other
"national schools" as may be "transferred" to this new state university.

The manner of selection and appointment of the university head is substantially different from that
provided by the PCC Charter.

● PUP President "shall be appointed by the President of the Philippines upon recommendation of
the Secretary of Education and Culture after consultation with the University Board of Regents"
● President of PCC, on the other hand, was appointed "by the President of the Philippines upon
recommendation of the Board of Trustees" composition of the new university's Board of
Regents is likewise different from that of the PCC Board of Trustees

New course offerings can be added to the curriculum of a school without affecting its legal existence.
Nor will changes in its existing structure and organization bring about its abolition and the creation of
a new one. Only an express declaration to that effect by the lawmaking authority will.
The law does not state that the lands, buildings and equipment owned by the PCC were being
"transferred" to the PUP but only that they "stand transferred" to it. "Stand transferred" simply means,
for example, that lands transferred to the PCC were to be understood as transferred to the PUP as
the new name of the institution.

But the reinstatement of petitioner to the position of president of the PUP could not be ordered by the
trial court because on June 10, 1978, P.D. No. 1437 had been promulgated fixing the term of office of
presidents of state universities and colleges at six (6) years, renewable for another term of six (6)
years, and authorizing the President of the Philippines to terminate the terms of incumbents who were
not reappointed.

In this case, Dr. Pablo T. Mateo Jr., who had been acting president of the university since April 3, 1979,
was appointed president of PUP for a term of six (6) years on March 28, 1980, with the result that
petitioner's term was cut short.
 [15] [VIOLA v. ALUNAN]
GR No. 115844 | August 15, 1997 | Creation of Administrative Agencies
| Mendoza, J. | Teñido

Petitioner: Cesar Viola - Brgy. Chairman

Respondents: HON. RAFAEL M. ALUNAN III, Secretary DILG, ALEX L. DAVID, President/Secretary
General, National Liga ng mga Barangay, LEONARDO L. ANGAT, President, City of Manila, Liga ng mga
Barangay

Case Doctrine :Congress can delegate the power to create positions such as these has been settled by
our decisions upholding the validity of reorganization statutes authorizing the President of the
Philippines to create, abolish or merge officers in the executive department.

FACTS:This is a petition for prohibition challenging the validity of Art. III, §§ 1-2 of the Revised
Implementing Rules and Guidelines for the General Elections of the Liga ng mga Barangay Officers so
far as they provide for the election of first, second and third vice presidents and for auditors for the
National Liga ng mga Barangay and its chapters.

Cesar Viola was the barangay chairman of Brgy. 167, Zone 15, District II of Manila when he brought this
action against the respondents, restraining them from carrying out the elections for questioned
positions. Petitioner contended that the positions in question are in excess of those provided in the
Local Government Code (R.A. No. 7160), §493 of which mentions as elective positions only those of
president, vice president, and five members of the board of directors in each chapter at the municipal,
city, provincial, metropolitan political subdivision, and national levels. Petitioner argues that, in providing
for the positions of first, second and third vice presidents and auditor for each chapter, §§1-2 of the
Implementing Rules expand the number of positions authorized in §493 of the Local Government Code
in violation of the principle that implementing rules and regulations cannot add or detract from the
provisions of the law they are designed to implement.

ISSUE/S:Whether or not the additional positions in question have been created without authority of law
(NO)

HELD:Petitioner's contention that the additional positions in question have been created without
authority of law is untenable. To begin with, the creation of these positions was actually made in the
Constitution and By-laws of the Liga ng Mga Barangay, which was adopted by the First Barangay
National Assembly on January 11, 1994.

The post of executive vice president is in reality that of the vice president in §493 of the LGC, so that the
only additional positions created for each chapter in the Constitution and By-laws are those of first,
second and third vice presidents and auditor. Contrary to petitioner's contention, the creation of the
additional positions is authorized by the LGC which provides as follows:

§493. Organization. The liga at the municipal, city, provincial, Metropolitan political subdivision, and
national levels directly elect a president, a vice-president, and five (5) members of the board of directors.
The board shall appoint its secretary and treasurer and create such other positions as it may deem
necessary for the management of the chapter. A secretary-general shall be elected form among the
members of the national liga and shall be charged with the overall operation of the liga on the national
level. The board shall coordinate the activities of the chapters of the liga. (emphasis added)

This provision in fact requires — and not merely authorizes the board of directors to "create such other
positions as it may deem necessary for the management of the chapter" and belies petitioner's claim
that said provision (§493) limits the officers of a chapter to the president, vice president, five members
of the board of directors, secretary, and treasurer. That Congress can delegate the power to create
positions such as these has been settled by our decisions upholding the validity of reorganization
statutes authorizing the President of the Philippines to create, abolish or merge officers in the executive
department.

Statutory provisions authorizing the President of the Philippines to make reforms and changes in
government owned or controlled corporations for the purpose of promoting "simplicity, economy and
efficiency" in their operations and empowering the Secretary of Education to prescribe minimum
standards of "adequate and efficient instruction" in private schools and colleges have been found to be
sufficient for the purpose of valid delegation. Judged by these cases, we hold that §493 of the Local
Government Code, in directing the board of directors of the liga to "create such other positions as may
be deemed necessary for the management of the chapter[s]," embodies a fairly intelligible standard.
There is no undue delegation of power by Congress.

Justice Davide contends in dissent, however, that "only the Board of Directors — and not any other body
— is vested with the power to create other positions as may be necessary for the management of the
chapter" and that, in any case, there is no showing that the Barangay National Assembly was authorized
to draft the Constitution and By-laws because he is unable to find any creating it. But it is contended in
the dissent that

"Section 493 of the LGC . . . vests the power to create additional positions in the Board of Directors of
the chapter." The implication seems to be that the board of the directors at the national level did not
have that power. It is necessary to consider the organizational structure of the Liga ng mga Barangay
as provided in the LGC.

While the board of directors of a local chapter can create additional positions to provide for the needs
of the chapter, the board of directors of the National Liga must be deemed to have the power to create
additional positions not only for its management but also for that of all the chapters at the municipal,
city, provincial and metropolitan political subdivision levels. Otherwise the National Liga would be no
different from the local chapters.

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

 [16] [Beja, Sr. v. CA]
G.R. No. 97149 | March 31, 1992 | Administrative Relationships - Attachment | Romero, J. | Maulion

Petitioner: Fidencio Y. Beja Sr.

Respondents:COURT OF APPEALS, HONORABLE REINERIO O. REYES, in his capacity as Secretary of
the Department of Transportation and Communications; COMMODORE ROGELIO A. DAYAN, in his
capacity as General Manager of the Philippine Ports Authority; DEPARTMENT OF TRANSPORTATION
AND COMMUNICATIONS, ADMINISTRATIVE ACTION BOARD; and JUSTICE ONOFRE A. VILLALUZ, in
his capacity as Chairman of the Administrative Action Board, DOTC

Case Doctrine :"Attachment" is defined in Sec. 38, Book IV, Chapter 7 of the Administrative Code of
1987, as to the lateral relationship between the department or its equivalent and the attached agency
or coordination. An attached agency has a larger measure of independence from the Department to
which it is attached than one which is under departmental supervision and control or administrative
supervision. This is borne out by the "lateral relationship" between the Department and the attached
agency. The attachment is merely for "policy and program coordination."

FACTS:In 1975, petitioner was hired by the Philippine Ports Authority (PPA) as arrastre supervisor. In
1976, he became Assistant Port Operations Officer and in 1977, Port Operations Officer. In February
1988, as a result of the reorganization of the PPA, he was appointed Terminal Supervisor.

On October 21, 1988, PPA General Manager filed an Administrative Case against petitioner Beja and
Villaluz for grave dishonesty, grave misconduct, willful violation of reasonable office rules and
regulations and conduct prejudicial to the best interest of the service. They allegedly erroneously
assessed storage fees resulting in the loss of P38,150.77 on the part of the PPA. Consequently, they
were preventively suspended for the charges. After a preliminary investigation, the case was
"considered closed for lack of merit."

On December 13, 1988, another administrative case was filed against Beja by the PPA general
manager for the same offenses on the first one. The charge consisted of six (6) different
specifications of administrative offenses including fraud against the PPA in the total amount of
P218,000.00. Beja was also placed under preventive suspension pursuant to Sec. 41 of P.D. No. 807.

The PPA general manager indorsed the second administrative case to the Administrative Action Board
(AAB) for "appropriate action." At the scheduled hearing, Beja asked for continuance on the ground
that he needed time to study the charges against him. The AAB proceeded to hear the case and gave
Beja an opportunity to present evidence. However, on February 20, 1989, Beja filed a petition for
certiorari with preliminary injunction before the Regional Trial Court of Misamis Oriental. Two days
later, he filed with the AAB a manifestation and motion to suspend the hearing of Administrative Case
on account of the pendency of the certiorari proceeding before the court. AAB denied the motion and
continued with the hearing of the administrative case.

Thereafter, Beja moved for the dismissal of the certiorari case below and proceeded to file before the
Supreme Court a petition for certiorari with preliminary injunction and/or temporary restraining order.
The Court referred the case to the Court of Appeals for "appropriate action."
Meanwhile, a decision was rendered by the AAB, adjudging the following, namely: a) That respondents
Geronimo Beja, Jr. and Hernando Villaluz are exonerated from the charge against them; b) That
respondent Fidencio Y. Beja be dismissed from the service; c) That his leave credits and retirement
benefits are declared forfeited; d) That he be disqualified from re-employment in the government
service; e) That his eligibility is recommended to be cancelled.

On December 10, 1990, the Court of Appeals also rendered a decision dismissing the petition for
certiorari for lack of merit. Hence, Beja elevated the case back to the Supreme Court through an
"appeal by certiorari with preliminary injunction and/or temporary restraining order." Among others,
Beja contends that the Court of Appeals failed to declare that the AAB itself as an adjudicatory body,
have no jurisdiction to try the administrative case against him.

ISSUE/S:Whether or not the Secretary of the Department of Transportation and Communications

(DOTC) and/or its Administrative Action Board (AAB) have jurisdiction over administrative cases
involving personnel below the rank of Assistant General Manager of the Philippine Ports Authority
(PPA), an agency attached to DOTC. - No

HELD: The transmittal of the complaint by the PPA General Manager to the AAB was premature. The
PPA General Manager should have first conducted an investigation, made the proper recommendation
for the imposable penalty and sought its approval by the PPA Board of Directors. It was discretionary
on the part of the petitioner to elevate the case to the then DOTC Secretary Reyes. Only then could the
AAB take jurisdiction of the case.

The PPA was created through P.D. No. 505 on July 11, 1974. Corporate powers of the PPA were
vested in a governing Board of Directors known as the Philippine Port Authority Council. Sec. 5(i) of the
decree gave the Council the power "to appoint, discipline and remove, and determine the composition
of the technical staff of the Authority and other personnel." P.D. No. 505 was substituted by P.D. No.
857 on December 23, 1975. Sec. 4(a) thereof created the Philippine Ports Authority which would be
"attached" to the then Department of Public Works, Transportation and Communication.

When Executive Order No. 125 dated January 30, 1987 reorganizing the Ministry of Transportation and
Communications was issued, the PPA retained its "attached" status. Even Executive Order No. 292 or
the Administrative Code of 1987 classified the PPA as an agency "attached" to the Department of
Transportation and Communications (DOTC). Sec. 24 of Book IV, Title XV, Chapter 6 of the same Code
provides that the agencies attached to the DOTC "shall continue to operate and function in accordance
with the respective charters or laws creating them, except when they conflict with this Code.

Attachment of an agency to a Department is one of the three administrative relationships mentioned in

Book IV, Chapter 7 of the Administrative Code of 1987, the other two being supervision and control and
administrative supervision. "Attachment" is defined in Sec. 38 thereof as follows:

"(3) Attachment. — (a) This refers to the lateral relationship between the department or its
equivalent and the attached agency or coordination...
xxx”
An attached agency has a larger measure of independence from the Department to which it is
attached than one which is under departmental supervision and control or administrative supervision.
This is borne out by the "lateral relationship" between the Department and the attached agency. The
attachment is merely for "policy and program coordination." With respect to administrative matters,
the independence of an attached agency from Departmental control and supervision is further
reinforced by the fact that even an agency under a Department's administrative supervision is free
from Departmental interference with respect to appointments and other personnel actions "in
accordance with the decentralization of personnel functions" under the Administrative Code of 1987.
Moreover, the Administrative Code explicitly provides that Chapter 8 of Book IV on supervision and
control shall not apply to chartered institutions attached to a Department.

The AAB, which was created during the tenure of Secretary Reyes under Office Order No. 88-318 dated
July 1, 1988, was designed to act, decide and recommend to him "all cases of administrative
malfeasance, irregularities, grafts and acts of corruption in the Department." Composed of a Chairman
and two (2) members, the AAB came into being pursuant to Administrative Order No. 25 issued by the
President on May 25, 1987.Its special nature as a quasi-judicial administrative body notwithstanding,
the AAB is not exempt from the observance of due process in its proceedings.

WHEREFORE, the decision of the Court of Appeals is REVERSED insofar as it validates the jurisdiction
of the DOTC and/or the AAB to act on Administrative Case No. PPA-AAB-1-049-89 and rules that due
process has been accorded the petitioner.
The AAB decision in said case is hereby declared NULL and VOID and the case is REMANDED to the
PPA whose General Manager shall conduct with dispatch its reinvestigation.
 [17] [EUGENIO V. CSC]
GR No. 115863| March 31, 1995 | Abolition and Creation | Puno, J.| Bathan

Petitioner: Aida Eugenio

Respondents: Civil Service Commission, Hon. Guingona, Jr., Hon. Enriquez, Jr.

Case Doctrine :The CESB was created by law, it can only be abolished by the legislature. This follows
an unbroken stream of rulings that the creation and abolition of public offices is primarily a legislative
function.

FACTS:Aida Eugenio applied for a Career Executive Service (CES) Eligibility and a CESO rank. She was
given a CES Eligibility and was recommended to the President for a CESO rank by the CES Board
(CESB).However, the Civil Service Commission (CSC) abolished the CESB and created the Office for
Career Executive Service of the Civil Service Commission through a Resolution (Reso. No. 93-4359).

This became an impediment to the appointment for Civil Service Officer Rank 4. Eugenio received a
letter stating that because of the abolishment of the CESB by the CSC, the President has refrained
from considering appointments.

Hence, this petition to annul said Resolution. Eugenio argued that the CSC cannot validly abolish the
CESB through an issuance of a Resolution because such is the prerogative of the legislature.

ISSUE/S:
1. Whether or not the CSC can validly abolish the CES Board (CESB). (NO)
2. Whether or not the CSC Resolution is valid. (NO)

HELD:
1. The CESB was created by law, i.e. PD 1. Because it was created by law, it can only be abolished
by the legislature. The creation and abolition of public offices is primarily a legislative function,
except when the office is created by the Constitution.

In the case at bar, the legislature has not enacted any law abolishing the CESB. In fact, the
General Appropriations Act at the time had set aside funds for the CESB.

The argument that CSC “may effect changes in the organization as the need arises” under
Section 17, Book V of the Administrative Code has no merit. Section 17 must also be read
together with Section 16 of the Code which enumerates the offices under CSC. CESB is not one
of the offices under CSC. Indeed, the CSC can reorganize its offices, but it is only limited to
those under its control.

The CESB is an autonomous entity despite it being attached to the CSC. It is not under CSC’s
control. By said attachment, CESB was not made to fall within the control of CSC. Under the
Administrative Code of 1987, the purpose of attaching one functionally interrelated government
agency to another is to attain "policy and program coordination."

2. Therefore, because the CSC cannot validly abolish the CESB, the Resolution abolishing the same
issued by the CSC is invalid.
 6. Powers of the President
a. Power of Control
b.
Article VII, Sec. 17, 1987 Constitution
Section 17. The President shall have control of all the executive departments, bureaus, and offices. He
shall ensure that the laws be faithfully executed.

Book III, Chapter 1, Section 1, Administrative Code

SECTION 1. Power of Control.—The President shall have control of all the executive departments,
bureaus, and offices. He shall ensure that the laws be faithfully executed.

[18] ARANETA V. GATMAITAN

L-8895 and L-9191| April 30, 1957 | Power of Control | Felix, J. | Gonzales

Petitioner: Salvador Araneta etc. et. al.

Respondents: The Hon. Magno S. Gatmaitan, etc., et al.

Case Doctrine : Under sections 75 and 83 of the Fisheries Law, the restriction and banning of trawl
fishing from all Philippine waters come within the powers of the Secretary of Agriculture and Natural
Resources, who, in compliance with his duties may even cause the criminal prosecution of those who in
violation of his instructions, regulations or orders are caught fishing with trawls in Philippine waters.
However, as the Secretary of Agriculture and Natural Resources exercises its functions subject to the
general supervision and control of the President of the Philippines (Section 75, Revised Administrative
Code), the President can exercise the same power and authority through executive orders, regulations,
decrees and proclamations upon recommendation of the Secretary concerned. Hence, Executive
Orders Nos. 22, 66 and 80, series of 1954, restricting and banning of trawl fishing from San Miguel Bay
(Camarines) are valid and issued by authority of law.

FACTS:
1. San Miguel Bay, located in between Camarines Norte and Camarines Sur, is considered the most
important fishing area in the Pacific side of Bicol.
2. In 1950, trawl operators migrated to this region for the purpose of use this particular method of
fishing in the bay.
3. The people around the bay, believing that trawl operation caused the depletion of marine
resources in the area, asked for the prohibition of the operation of trawls in San Miguel Bay.
Hence, a resolution was passed by the Municipal Mayor’s League condemning the operation of
trawls as the cause of the wanton destruction of the shrimp specie and resolving to petition the
President of the Philippines to regulate fishing in the Bay. Another resolution was passed
praying that the Presidentban the operation of trawls therein. The Provincial Governor also
petitioned on behalf of the non-trawl fishermen recommending the cancellation of the licenses
of trawl operators.
4. The President issued on April 5, 1954, E.O 22 prohibiting the use of trawls in San Miguel Bay.
This was later on amended allowing trawl fishing but only during typhoon season.
5. A group of Otter trawl operators filed a complaint for injunction and/or declaratory relief with
preliminary injunction with the CFI praying that a writ of preliminary injunction be issued to
 restrain the Secretary of Agriculture and Natural Resources and the Director of Fisheries from
enforcing the EO.
6. The Secretary of Agriculture and Natural Resources and the Director of Fisheries answered,
among others, that since plaintiffs question the validity of the executive orders issued by the
President, then the Secretary of Agriculture and Natural Resources and the Director of Fisheries
were not the real parties in interest.

ISSUE/S:
1. Whether or not the President of the Philippines has authority to issue the assailed EOs - YES
2. Whether or not the EOS constitute an undue delegation of powers of Congress - NO

HELD:

1. Yes, since the Secretary of Agriculture and Natural Resources has authority to regulate or ban
fishing by trawls, the President exercises the same power and authority as granted under
Section 10(1) of Article VII of the Constitution.

1. Section 10(1), Article VII of the Constitution of the Philippines prescribes:

SEC. 10(1). The President shall have control -of all the executive departments, bureaus or offices,
exercises general supervision over all local governments as may be provided by law, and take care
that the laws be faithfully executed.
2. Section 63 of the Revised Administrative Code reads as follows:
SEC. 63. EXECUTIVE ORDERS AND EXECUTIVE PROCLAMATION.—Administrative acts and
commands of the President of the Philippines touching the organization or mode of operation of
the Government or rearranging or readjusting any of the districts, divisions, parts or ports of the
Philippines, and all acts and commands governing the, general performance of duties by public
'employees or disposing of issues of general concern shall be made in executive orders.
3. Section 74 of the Revised Administrative Code also provides for department organization:
All executive functions of the Government of the Republic of the Philippines shall be directly
under the Executive Department subject to the supervision and control of the President of the
Philippines in matters of general policy. The Departments are established for the proper
distribution of the work 01 the Executive, for the performance of the functions expressly assigned
to them by law, and in order that each branch of the administration may have a chief responsible
for its direction and policy. Each Department Secretary shall assume the burden of, and
responsibility for, all activities of the Government under his control and supervision. For
administrative purposes the President of the Philippines shall be considered the Department Head
of the Executive Office.
4. The executive department of Agriculture and Natural Resources is placed under the direction
and control of the Secretary, who exercises its functions subject to the general supervision and
control of the President. Moreover, EOs, regulations, decrees and proclamations are
promulgated by the President and issued upon the proposition and recommendation of the
respective Department.
5. In this case, the EOs were promulgated upon the recommendation of the Secretary of
Agriculture and Natural Resources.

2. No, there was no undue delegation of legislative powers by the Congress

 1. The Fisheries Act (Act No 4003) is complete in itself, leaving to the Secretary of Agriculture
and Natural Resources the promulgation of rules and regulations to carry into effect the
legislative intent.
2. The protection of fry or fish eggs and small and immature fishes, Congress intended with the
promulgation of Act No. 4003, to prohibit the use of any fish net or fishing device like trawl nets
that could endanger and deplete our supply of sea food, and to that end authorized the Secretary
of Agriculture and Natural Resources to provide by regulations such restrictions as he deemed
necessary in order to preserve the aquatic resources of the land. Consequently, when the
President, in response to the clamor of the people and authorities of Camarines Sur issued
Executive Order No. 80 absolutely prohibiting fishing by means of trawls in all waters
comprised within the San Miguel Bay, he did nothing but show an anxious regard for the
welfare of the inhabitants of said coastal province and dispose of issues of general concern.

Lacson-Magallanes Co., Inc. vs. Jose Paño, et. al.

G.R. No. L-27811 :: 27 November 1967
Sanchez, J.

LACSON-MAGALLANES CO., INC., plaintiff-appellant,

vs.
JOSE PAÑO, HON. JUAN PAJO, in his capacity as Executive Secretary, and HON. JUAN DE G.
RODRIGUEZ, in his capacity as Secretary of Agriculture and Natural Resources, defendants-appellees.

Leopoldo M. Abellera for plaintiff-appellant.

Victorio Advincula for defendant Jose Paño.
Office of the Solicitor General for defendant Secretary of Agriculture and Natural Resources and
Executive Secretary

FACTS:
In 1932, Jose Magallanes was a permittee and actual occupant of a 1,103-hectare pasture land situated
in Davao. On 1953, Magallanes ceded his rights and interests to a portion of the above public land to
the plaintiff. On 1954, the same was officially released from the forest zone as pasture land and
declared agricultural land. On 1955, Jose Paño and nineteen other claimants applied for the purchase
of 90 hectares of the released area. Plaintiff in turn filed its own sales application covering the entire
released area. The Director of Lands, following an investigation of the conflict, rendered a decision on
1956 giving due course to the application of plaintiff corporation. When the case was elevated to the
President of the Philippines, Executive Secretary Juan Pajo, by authority of the president, declared that
it would be for public interest that appellants, who are mostly landless farmers, be allocated that portion
on which the petitioner have made improvements.

ISSUES:

May the Executive Secretary, acting by authority of the President, reverse a decision of the Director of
Lands that had been affirmed by the Executive Secretary of Agriculture and Natural Resources?

HELD:
YES. The President’s duty to execute the law and control of all executive departments are of
constitutional origin. Naturally, he controls and directs their acts. Implicit then is his authority to go
over, confirm, modify or reverse the action taken by his department secretaries. It may also be stated
that the right to appeal to the President reposes upon the President’s power of control over the executive
departments. He may delegate to his Executive Secretary acts which the Constitution does not
command that he perform in person. As the Executive Secretary acts by authority of the President, his
decision is that of the President’s. Such decision is to be given full faith and credit by our courts, unless
disapproved or reprobated by the Chief Executive.

[20] [Humphrey's Executor v. United States]

295 U.S. 602 | May 27, 1935 | Powers of the President-Power of Control | JUSTICE SUTHERLAND |
Jalandoni
Petitioner: William E. Humphrey
Respondents: United States

Case Doctrine: Under the Constitution that unlimited power of removal is not possessed by the
President in respect of officers of the character of those just named. The authority of Congress, in
creating quasi-legislative or quasi-judicial agencies, to require them to act in discharge of their duties
independently of executive control cannot well be doubted; and that authority includes, as an
appropriate incident, power to fix the period during which they shall continue in office, and to forbid
their removal except for cause in the meantime.

FACTS: William E. Humphrey, on December 10, 1931, was nominated by President Hoover to succeed
himself as a member of the Federal Trade Commission, and was confirmed by the United States Senate.
He was duly commissioned for a term of seven years expiring September 25, 1938; and, after taking the
required oath of office, entered upon his duties. On July 25, 1933, President Roosevelt addressed a letter
to the commissioner asking for his resignation, on the ground "that the aims and purposes of the
Administration with respect to the work of the Commission can be carried out most effectively with
personnel of my own selection," but disclaiming any reflection upon the commissioner personally or
upon his services. The commissioner replied, asking time to consult his friends. After some further
correspondence upon the subject, the President on August 31, 1933, wrote the commissioner
expressing the hope that the resignation would be forthcoming and saying: "You will, I know, realize that
I do not feel that your mind and my mind go along together on either the policies or the administering of
the Federal Trade Commission, and, frankly, I think it is best for the people of this country that I should
have a full confidence." Petitioner refused to resign, and on October 7, 1933, the President wrote to him:
"Effective as of this date you are hereby removed from the office of Commissioner of the Federal Trade
Commission."

Petitioner never acquiesced in this action, but continued thereafter to insist that he was
still a member of the commission, entitled to perform its duties and receive the
compensation provided by law at the rate of $10,000 per annum.

ISSUE/S:Whether or not the power of the President to remove a commissioner is restricted or limited
- YES

HELD: Under the Constitution that unlimited power of removal is not possessed by the President in
respect of officers of the character of those just named. The authority of Congress, in creating quasi-
legislative or quasi-judicial agencies, to require them to act in discharge of their duties independently of
executive control cannot well be doubted; and that authority includes, as an appropriate incident, power
to fix the period during which they shall continue in office, and to forbid their removal except for cause
in the meantime. For it is quite evident that one who holds his office only during the pleasure of another,
cannot be depended upon to maintain an attitude of independence against the latter's will. The
fundamental necessity of maintaining each of the three general departments of government entirely free
from the control or coercive influence, direct or indirect, of either of the others, has often been stressed
and is hardly open to serious question. So much is implied in the very fact of the separation of the powers
of these departments by the Constitution; and in the rule which recognizes their essential co-equality.
The sound application of a principle that makes one master in his own house precludes him from
imposing his control in the house of another who is master there. James Wilson, one of the framers of
the Constitution and a former justice of this court, said that the independence of each department
required that its proceedings "should be free from the remotest influence,direct or indirect, of either of
the other two powers." Andrews, The Works of James Wilson (1896), vol. 1, p. 367. And Mr. Justice Story
in the first volume of his work on theConstitution, 4th ed., § 530, citing No. 48 of the Federalist, said that
neither of the departments in reference to each other "ought to possess, directly or indirectly, an
overruling influence in the administration of their respective powers."

The power of removal here claimed for the President falls within this principle, since its coercive
influence threatens the independence of a commission, which is not only wholly disconnected from the
executive department, but which, as already fully appears, was created by Congress as a means of
carrying into operation legislative and judicial powers,and as an agency of the legislative and judicial
departments.

Facts.

President Roosevelt fired Mr. Humphrey, a commissioner of the Federal Trade Commission (FTC), in
violation of a statute that said that a commissioner could only be removed for “inefficiency, neglect of
duty or malfeasance in office.” The executor of Humphrey’s estate (plaintiff) sued the United States
(defendant) for back pay. The government responded that back pay was not merited because the
removal restriction was unconstitutional. The case came before the United States Supreme Court.

Issue.

Whether the President has unrestricted power, under the U.S. Constitution, to remove a government
officer whose functions are of a legislative and judicial nature where Congress provides specific grounds
upon which the officer may be removed from office.

Held.

An FTC commissioner’s functions are legislative and judicial in nature. The President’s exclusive
removal power does not extend to such government officers. The President’s exercise of his removal
power here exerts coercive influence over the FTC that threatens the agency’s independence. Such an
outcome is at odds with the separation of powers doctrine. Accordingly, the President had no
constitutional power to remove Humphrey outside of the reasons specified by Congress.
 b. Power to Create Public Office and Reorganize

CODAL:
Article VII, Section 17, 1987 Constitution

SECTION 17. The President shall have control of all the executive departments, bureaus, and offices. He
shall ensure that the laws be faithfully executed.

Book III, Chapter 10, Section 31, Administrative Code

SECTION 31. Continuing Authority of the President to Reorganize his Office.—The President, subject
to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have
continuing authority to reorganize the administrative structure of the Office of the President. For this
purpose, he may take any of the following actions:

(1) Restructure the internal organization of the Office of the President Proper, including the immediate
Offices, the Presidential Special Assistants/Advisers System and the Common Staff Support System, by
abolishing, consolidating or merging units thereof or transferring functions from one unit to another;

(2) Transfer any function under the Office of the President to any other Department or Agency as well
as transfer functions to the Office of the President from other Departments and Agencies; and

(3) Transfer any agency under the Office of the President to any other department or agency as well as
transfer agencies to the Office of the President from other departments or agencies.
[21] [Biraogo v Philippine truth]
192935| Dec 7, 2010| Topic | Mendoza,J| Carig

Petitioner: LOUIS “BAROK” C. BIRAOGO

Respondents: THE PHILIPPINE TRUTH COMMISSION OF 2010

Petitioners: REP. EDCEL C. LAGMAN, REP. RODOLFO B. ALBANO, JR., REP. SIMEON A.
DATUMANONG, and REP. ORLANDO B. FUA, SR.,

Respondents: EXECUTIVE SECRETARY PAQUITO N. OCHOA, JR. and DEPARTMENT OF BUDGET AND
MANAGEMENT SECRETARY FLORENCIO B. ABAD

Case Doctrine :

The creation of a fact-finding body to investigate cases of graft and corruption falls within the power of
the president, pursuant to its obligation to faithfully execute the laws. However, to focus such fact-
finding to the acts of the past administration violates the equal protection.

FACTS:Prior to May 2010 Elections Benigno Simeon Aquino declared war against graft and corruption;
by this he won the Presidential race of 2010. To carry out the war against graft and corruption, he created
the Philippine Truth Commission (PTC) by EO No. 1. PTC is a fact-finding body, and is an ad hoc body
created under the Office of the President the primary task of which is to investigate reports of graft and
corruption committed by third-level public officers and employees and agents during the previous
administration. It is vested with the investigative bodies under the Administrative Code but it is not quasi-
judicial body.

what the ptc can do?

Gather, collect and assess evidence of graft and corruption and make recommendations.

what the ptc can’t do?

Adjudicate or resolve issues, cite people in contempt, cause arrest, determine from facts gathered if
probable cause exist to warrant filing of information before the Courts, impose criminal, civil penalties
and administrative sanctions.

Petitioners’arguments

The PTC is unconstitutional because:

1.It arrogates power of the Congress to create a public office and appropriate funds for its operation;

2.The power delegated under Sec. 31 of the Admin Code does not legitimize EO No. 1 as it does not
grant the creation of office as the PTC;

3.It illegally amended the Constitution by vesting with it quasi-judicial powers duplicating or superseding
the Office of the Ombudsman;

4. Violates the equal protection clause for selectively targeting the previous administration;

5.Violates the generally accepted principles of international law where Truth Commissions were solely
created for investigating human rights violation

6.It is an exercise in futility;

7.The fact that previous commissions are not challenged does not bar raising questions of
constitutionality.

ISSUE/S:
1.Do petitioners have legal standing?
2. Does the creation of the PTC fall within the ambit of the power to reorganize- NO
3. Whether or not Executive Order No. 1 violates the principle of separation of powers by usurping the
powers of Congress to create and to appropriate funds for public offices, agencies and commissions;
- NO

4. Whether or not Executive Order No. 1 supplants the powers of the Ombudsman and the DOJ

5. Whether or not Executive Order No. 1 violates the equal protection clause - yes

HELD:

1. Biraogo has no legal standing. But the issue raised is of transcendental importance not only to
the public but also to the Bench and the Bar, they should be resolved for the guidance of all.
 The direct injury test requires that the person who impugns the validity of a statute must
have a personal and substantial interest in the case such that he has sustained, or will sustain direct
injury as a result. (Vera Doctrine)

The petitioners-legislators have legal standing. Their petition primarily invokes usurpation of the power
of the Congress as a body to which they belong as members.

Legislators have a legal standing to see to it that the prerogative, powers and privileges vested by the
Constitution in their office remain inviolate. Thus, they are allowed to question the validity of any official
action which, to their mind, infringes on their prerogatives as legislators.

2. No. The provision refers to reduction of personnel, consolidation of offices, or abolition thereof
by reason of economy or redundancy of functions. The power to create offices is not granted

The President’s power to conduct investigations (investigative power of the President) to aid him in
ensuring the faithful execution of laws [VII(17)]— in this case, fundamental laws on public accountability
and transparency — is inherent in the President’s powers as the Chief Executive. That the authority of
the President to conduct investigations and to create bodies to execute this power is not explicitly
mentioned in the Constitution or in statutes does not mean that he is bereft of such authority. (faithful
execution clause)

requisites for a valid exercise of its power of judicial review

1) there must be an actual case or controversy calling for the exercise of judicial power;
(2) the person challenging the act must have the standing to question the validity of the subject act or
issuance; otherwise stated, he must have a personal and substantial interest in the case such that he
has sustained, or will sustain, direct injury as a result of its enforcement;
3) the question of constitutionality must be raised at the earliest opportunity; and
(4) the issue of constitutionality must be the very lis mota of the case

3. No. Justification is found in Sec. 17, Art. VII of the Constitution, imposing upon the President
the duty to ensure that all laws are faithfully executed. It carries with it the power to create
bodies that will aid him in the performance of such task. There is also no appropriation but
merely allotment of the funds already appropriated.

4. PTC will not supplant the Ombudsman or the DOJ or erode their respective powers. It is a fact-
finding body, not a quasi-judicial body. It does not have the power to settle controversies, at
most, its findings are recommendatory. Its task is to investigate issues of graft and corruption
of the previous administration to aid the President in ensuring the faithful execution of the laws.

Quasi-judicial powers involve 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 law
itself in enforcing and administering the same law.

It is exclusively vested in the judiciary, in case of administrative agencies, it must be clearly

authorized by the legislature.
 5. YES. By singling out the previous administration, there is apparent transgression of the equal
protection clause.

Equal protection simply requires that all persons or things similarly situated should be treated alike, both
as to rights conferred and responsibilities imposed.

Universal application of law, however is not required. What is required is equality among equals.
Classification is permitted but such classification must pass the reasonableness test. The
reasonableness test has four requisites:
(1) The classification rests on substantial distinctions;
(2) It is germane to the purpose of the law;
(3) It is not limited to existing conditions only; and
(4) It applies equally to all members of the same class.
 [22] MANGUNE VS ERMITA
G.R. No. 182604 | September 27, 2016 | Power to reorganize | Jardeleza, J. | Jimenez

Petitioner: Employees of the DOH assigned to TPDH (Mangune)

Respondents: Ermita (Executive Secretary, Duque (DOH Secretary); Tinga (Mayor of Taguig), Capco
(Mayor of Pateros)

Case Doctrine : The transfer of the administration and supervision of TPDH from the DOH to the City of
Taguig is a result of the President's exercise of her power of control over the executive department,
including the DOH.

FACTS:
In 1994, RA No. 7842 was enacted establishing under the administration and supervision of DOH, the
Taguig-Pateros District Hospital (TPDH). In 2006, President Arroyo issued E.O. No. 567 devolving the
administration and supervision of TPDH from the DOH to the City of Taguig. E.O. No. 567 provided that
it was issued pursuant to R.A. No. 7160 or Local Government Code of 1991 and the President's
continuing authority to reorganize the offices under the executive department. Thus Mayor Tinga issued
E.O. No. 053 formalizing the plan for the City of Taguig's take-over of the operations of TPDH. The City
of Taguig and the DOH subsequently entered into a Memorandum of Agreement providing the details of
the transition and turn-over. Petitioners then submitted a position paper to the DOH and letter to the
office of the President which received no action. Thereafter, Mayor Tinga issued EO No. 001 creating
the TPDH Management Team which will implement the MOA. Petitioner then filed a petition for
declaratory relief which was later amended to a Petition for Prohibition with prayer of issuance of TRO
and Writ of Preliminary injuction against respondents in the RTC of Manila. RTC denied the prayer. On
motion of petitioners and due to the Municipal Government of Pateros' failure to file its Answer to the
amended petition despite notice, the RTC declared it in default.

ISSUE/S:Whether or not E.O. No. 567 (transferring TDPH administration to Taguig City) is
constitutional

HELD:
Yes. To be valid, an administrative issuance, such as an executive order, 40 must comply with the
following requisites:
(1) Its promulgation must be authorized by the legislature;
E.O. No. 567 was issued pursuant to Section 17 of the Local Government Code expressly
devolving to the local government units the delivery of basic services and facilities,
including health services.
The transfer of the administration and supervision of TPDH from the DOH to the City of
Taguig is a result of the President's exercise of her power of control over the executive
department, including the DOH.
The Constitution declares it a policy of the State to ensure the autonomy of local
governments while Section 17 of the Local Government Code secures to the local
governments the genuine and meaningful autonomy that would develop them into self-
reliant communities and effective partners in the attainment of national goals. Therefore,
in issuing E.O. No. 567, the President was actually carrying out the provisions of the
Constitution and the Local Government Code. She was performing her duty to ensure the
faithful execution of the laws.

(2) It must be promulgated in accordance with the prescribed procedure;

Petitioners do not question the procedure by which E.O. No. 567 was issued.

(3) It must be within the scope of the authority given by the legislature;
Regarding petitioners’ invocation of Sec. 17(e), LGC, which limits the devolution of services
to LGUs only 6 months from the effectivity of the LGC, the Court states that the law “must
be interpreted not by the letter that killeth, but by the spirit that giveth life.” Section 3, Article
X of the Constitution provides that the congress shall enact a local government code which
shall provide for a more responsive and accountable local government structure instituted
through a system of decentralization xxx. One form of decentralization is devolution, which
involves the transfer of powers, responsibilities, and resources for the performance of
certain functions from the central government to the LGUs. Petitioners' restrictive
interpretation of Section 17(e) is inconsistent with the Constitution and the Local
Government Code. It limits the devolution intended by both the Constitution and the Local
Government Code to an unduly short period of time.

(4) It must be reasonable.

E.O. No. 567 meets the test of reasonableness. The transfer of the administration and
supervision of TPDH from the DOH to the City of Taguig aims to provide the City of Taguig
the genuine and meaningful autonomy which would make it an effective and efficient
partner in the attainment of national goals and providing basic health services and facilities
to the community.
 [23] [Pichay v Executive Secretary]
GR No. 196425| July 24, 2012| Administrative Agencies- Powers of the President | Perlas-Bernabe,
J.| Tan

Petitioner: Prospero Pichay

Respondents: Office of the Deputy Executive Secretary for Legal Affairs-Investigative and Adjudicatory
Division, Hon. Paquito N. Ochoa, Jr., in his capacity as Executive Secretarym and Hon. Cesar V.
Purisima, in his capacity as Secretary of Finance, and as an ex-officio member of the monetary board

Case Doctrine : Power to Create Public Office and Reorganize

FACTS:
>seeks to declare EO 13 as unconstitutional

1. In 2001, then President Arroyo issued EO No 12, creating the Presidential Anti-Graft
Commission (PAGC) which has the power to investigate or hear administrative cases or
complaints for possible graft and corruption against presidential appointees and to submit its
report and recommendations to the President.

2. In 2010, then President Aquino issued EO No. 13, abolishing PAGC and transferring its
functions to the Investigative and Adjudicatory Division - Office of the Deputy Executive
Secretary for Legal Affairs (IAD-ODESLA). Its powers, functions, and duties are mentioned in
Section 2 of EO 13 which states:
“SECTION 2. Abolition of Presidential Anti-Graft Commission (PAGC).— To
enable the the Office of the President (OP) to directly investigate graft and
corrupt cases of Presidential appointees in the Executive Department
including heads of government-owned and controlled corporations, the
Presidential Anti-Graft Commission (PAGC) is hereby abolished and their vital
functions and other powers and functions inherent or incidental thereto,
transferred to the Office of the Deputy Executive Secretary for Legal Affairs
(ODESLA), OP in accordance with the provisions of this Executive Order.

3. In 2011, Finance Secretary Purisima filed a complaint before the IAD-ODESLA against Pichay
(Chairman of the Board of Trustees of the Local Water Utilities Administration [LWUA]) and the
other board members of LWUA for grave misconduct which arose from the purchase by LWUA
of 445,377 shares of stock from Express Savings Bank, Inc.

4. Alleging that no other plain, speedy, and adequate remedy is available to him, Pichay resorted
to filing the present petition for certiorari and prohibition, seeking to declare EO 13 as
unconstitutional based on the following grounds:
a. EO 13 usurped the power of the legislature to create a public office
b. EO 13 usurped the power of the legislature to appropriate funds
c. EO 13 usurped the power of the Congress to delegate quasi-judicial powers to
administrative agencies
d. EO 13 encroached upon the powers of the Ombudsman
e. EO violated the equal protection clause
 He assailed that the President has no authority under any existing law to create the IAD-ODESLA,
and that by doing so, the President usurped the powers of congress.

ISSUE/S:
Whether or not EO 13 is unconstitutional. - NO

HELD: NO. The Supreme Court held that Sec. 31 of EO No. 292 (Administrative Code of 1987) states
that the president has the Continuing Authority to reorganize the offices under him in order to achieve
simplicity, economy, and efficiency.
“Section 31, Book 3 of EO 292:
Sec. 31. Continuing Authority of the President to Reorganize his Office. - The
President, subject to the policy in the Executive Office and in order to achieve
simplicity, economy and efficiency, shall have continuing authority to reorganize
the administrative structure of the Office of the President. For this purpose, he may
take any of the following actions:

(1) Restructure the internal organization of the Office of the President Proper,
including the immediate Offices, the Presidential Special Assistants/Advisers
System and the Common staff Support System, by abolishing, consolidating or
merging units thereof or transferring functions from one unit to another;

(2) Transfer any function under the Office of the President to any other Department
or Agency as well as transfer functions to the Office of the President from other
Departments and Agencies; and

(3) Transfer any agency under the Office of the President to any other department
or agency as well as transfer agencies to the Office of the President from other
departments or agencies. “

Clearly, the abolition of the PAGC and the transfer of its functions to a division specially created within
the ODESLA is properly within the prerogative of the President under his continuing "delegated
legislative authority to reorganize" his own office pursuant to E.O. 292.

Furthermore, the President's authority to issue EO 13 and const we itute the IAD-ODESLA as his fact-
finding investigator cannot be doubted. After all, as Chief Executive, he is granted full control over the
Executive Department to ensure the enforcement of the laws. Section 17, Article VII of the Constitution
provides:
Section 17. The President shall have control of all the executive departments,
bureaus and offices.He shall ensure that the laws be faithfully executed.

The obligation to see to it that laws are faithfully executed necessitates the corresponding power in the
President to conduct investigations into the conduct of officials and employees in the executive
department.
 [24] [Malaria Employees and Workers Association of the Philippines, Inc. (MEWAP) et al v. The
Honorable Executive Secretary Alberto Romulo]
Docket No.160093 | July 31, 2007 | Administrative Agencies |Puno, C.J |Lim

Petitioner: Malaria Employees and Workers Association of the Philippines, Inc. (MEWAP) et al
Respondents: The Honorable Executive Secretary Alberto Romulo

Case Doctrine :Be that as it may, the President must exercise good faith in carrying out the
reorganization of any branch or agency of the executive department. Reorganization is effected in good
faith if it is for the purpose of the economy or to make bureaucracy more efficient. R.A. No. 6656
provides for the circumstances which may be considered as evidence of bad faith in the removal of civil
service employees made as a result of reorganization, to wit: (a) where there is a significant increase in
the number of positions in the new staffing pattern of the department or agency concerned; (b) where
an office is abolished and another performing substantially the same functions is created; (c) where
incumbents are replaced by those less qualified in terms of status of appointment, performance and
merit; (d) where there is a classification of offices in the department or agency concerned and the
reclassified offices perform substantially the same functions as the original offices; and (e) where the
removal violates the order of separation.

FACTS:On October 19, 1999, the President issued E.O. No. 165 "Directing the Formulation of an
Institutional Strengthening and Streamlining Program for the Executive Branch" which created the
Presidential Committee on Executive Governance (PCEG) composed of the Executive Secretary as chair
and the Secretary of the Department of Budget and Management (DBM) as co-chair. The DBM, on July
8, 2000, issued the Notice of Organization, Staffing and Compensation Action (NOSCA). On July 17,
2000, the PCEG likewise issued Memorandum Circular (M.C.) No. 62, entitled "Implementing Executive
Order No. 102, Series of 1999 Redirecting the Functions and Operations of the Department of Health."
2 M.C. No. 62 directed the rationalization and streamlining of the said Department.
On July 28, 2000, the Secretary of Health again issued Department Circular No. 221, Series of 2000,
stating that the Department will start implementing the Rationalization and Streamlining Plan by a
process of selection, placement or matching of personnel to the approved organizational chart and the
list of the approved plantilla items. The Secretary also issued Administrative Order (A.O.) No. 94, Series
of 2000, which set the implementing guidelines for the restructuring process on personnel selection and
placement, retirement and/or voluntary resignation. A.O. No. 94 outlined the general guidelines for the
selection and placement of employees adopting the procedures and standards set forth in R.A. No. 6656
4 or the "Rules on Governmental Reorganization", Civil Service Rules and Regulations, Sections 76 to 78
of the GAA for the Year 2000, and Section 42 of E.O. No. 292.
Petitioner Malaria Employees and Workers Association of the Philippines, Inc. (MEWAP) is a union of
affected employees in the Malaria Control Service of the Department of Health. MEWAP filed a
complaint, docketed as Civil Case No. 00-98793, with the Regional Trial Court of Manila seeking to nullify
Department Memorandum No. 157, the NOSCA and the Placement List of Department of Health
Personnel and other issuances implementing E.O. No. 102.

FACTS: Petition for Review on Certiorari of the Decision of the Court of Appeals in CA-G.R. SP No. 65475
dated September 12, 2003 which upheld the validity of (E.O.) No. 102, the law Redirecting the Functions
and Operations of the Department of Health. Then President Estrada issued E.O. No. 102 on May 24,
1999 pursuant to Section 20, Chapter 7, Title I, Book III of E.O. No. 292, “Administrative Code of 1987”,
and Sections 78 and 80 of R.A.8522, also known as the General Appropriations Act (GAA) of 1998. E.O.
No. 102 provided for structural changes and redirected the functions and operations of the Department
of Health.

ISSUE/S:Whether the President has authority to effect a reorganization of a department under the
Executive Branch. YES.

HELD: The President has the authority to carry out a reorganization of the Department of Health under
the Constitution and statutory laws. This authority is an adjunct of his power of control.

In Canonizado v. Aguirre, the Court held that reorganization "involves the reduction of personnel,
consolidation of offices, or abolition thereof by reason of economy or redundancy of functions." It alters
the existing structure of government offices or units therein, including the lines of control, authority and
responsibility between them. While the power to abolish an office is generally lodged with the
legislature, the authority of the President to reorganize the executive branch, which may include such
abolition, is permissible under our present laws, viz.: The general rule has always been that the power
to abolish a public office is lodged with the legislature. This proceeds from the legal precept that the
power to create includes the power to destroy. A public office is either created by the Constitution, by
statute, or by authority of law. Thus, except where the office was created by the Constitution itself, it
may be abolished by the same legislature that brought it into existence.

The exception, however, is that as far as bureaus, agencies or offices in the executive department are
concerned, the President's power of control may justify him to inactivate the functions of a particular
office, or certain laws may grant him the broad authority to carry out reorganization measures. The
President's power to reorganize the executive branch is also an exercise of his residual powers under
Section 20, Title I, Book III of E.O. No. 292 which grants the President broad organization powers to
implement reorganization measures, viz.:
SEC. 20. Residual Powers. — Unless Congress provides otherwise, the President shall exercise such
other powers and functions vested in the President which are provided for under the laws and which are
not specifically enumerated above, or which are not delegated by the President in accordance with law.

The pertinent provisions of Presidential Decree No. 1416, as amended by Presidential Decree No. 1772,
clearly support the President's continuing power to reorganize the executive branch, viz.: 1. The
President of the Philippines shall have continuing authority to reorganize the National Government. In
exercising this authority, the President shall be guided by generally acceptable principles of good
government and responsive national development, including but not limited to the following guidelines
for a more efficient, effective, economical and development-oriented governmental framework: xxx b)
Abolish departments, offices, agencies or functions which may not be necessary, or create those which
are necessary, for the efficient conduct of government functions, services and activities; c) Transfer
functions, appropriations, equipment, properties, records and personnel from one department, bureau,
office, agency or instrumentality to another; d) Create, classify, combine, split, and abolish positions; e)
Standardize salaries, materials, and equipment; f) Create, abolish, group, consolidate, merge, or integrate
entities, agencies, instrumentalities, and units of the National Government, as well as expand, amend,
change, or otherwise modify their powers, functions, and authorities, including, with respect to
government-owned or controlled corporations, their corporate life, capitalization, and other relevant
aspects of their charters; g) Take such other related actions as may be necessary to carry out the
purposes and objectives of this Decree.
In fact, as pointed out by respondents, the President's power to reorganize the executive department
even finds further basis under Sections 78 and 80 of R.A. No. 8522, viz.: Section 78. Organizational
Changes — Unless otherwise provided by law or directed by the President of the Philippines, no
organizational unit or changes in key positions in any department or agency shall be authorized in their
respective organizational structure and funded from appropriations provided by this Act. Section 80.
Scaling Down and Phase-out of Activities of Agencies within the Executive Branch — The heads of
departments, bureaus, offices and agencies are hereby directed to identify their respective activities
which are no longer essential in the delivery of public services and which may be scaled down, phased-
out or abolished subject to Civil Service rules and regulations. Said activities shall be reported to the
Office of the President through the Department of Budget and Management and to the Chairman,
Committee on Appropriations of the House of Representatives and the Chairman, Committee on Finance
of the Senate. Actual scaling down, phase-out or abolition of the activities shall be effected pursuant to
Circulars or Orders issued for the purpose by the Office of the President.

Be that as it may, the President must exercise good faith in carrying out the reorganization of any branch
or agency of the executive department. Reorganization is effected in good faith if it is for the purpose of
economy or to make bureaucracy more efficient. R.A. No. 6656 provides for the circumstances which
may be considered as evidence of bad faith in the removal of civil service employees made as a result
of reorganization, to wit: (a) where there is a significant increase in the number of positions in the new
staffing pattern of the department or agency concerned; (b) where an office is abolished and another
performing substantially the same functions is created; (c) where incumbents are replaced by those less
qualified in terms of status of appointment, performance and merit; (d) where there is a classification
of offices in the department or agency concerned and the reclassified offices perform substantially the
same functions as the original offices; and (e) where the removal violates the order of separation.
 [25] [Anak Mindanao v. ES]
GR No. 166052| August 29, 2007 | Topic | Carpio, J.| Ricasio

Petitioner: ANAK MINDANAO PARTY-LIST GROUP, as represented by Rep. Mujiv S. Hataman, and
MAMALO DESCENDANTS ORGANIZATION, INC., as represented by its Chairman Romy Pardi

Respondents:THE EXECUTIVE SECRETARY, THE HON. EDUARDO R. ERMITA, and THE SECRETARY
OF AGRARIAN/LAND REFORM, THE HON. RENE C. VILLA

Case Doctrine : The President may transfer any agency under the Office of the President to any other
department or agency, subject to the policy in the Executive Office and in order to achieve simplicity,
economy and efficiency.

An attached agency has a larger measure of independence from the Department to which it is attached
than one which is under departmental supervision and control or administrative supervision. This is
borne out by the "lateral relationship" between the Department and the attached agency. The attachment
is merely for "policy and program coordination."

FACTS: Petitioners Anak Mindanao Party-List Group (AMIN) and Mamalo Descendants Organization,
Inc. (MDOI) assail the constitutionality of Executive Order (E.O.) Nos. 364 (TRANSFORMING THE
DEPARTMENT OF AGRARIAN REFORM INTO THE DEPARTMENT OF LAND REFORM) and 379
(AMENDING EXECUTIVE ORDER NO. 364 ENTITLED TRANSFORMING THE DEPARTMENT OF
AGRARIAN REFORM INTO THE DEPARTMENT OF LAND REFORM).
The salient provision of EO No. 379 reads : Section 3. The National Commission on Indigenous Peoples
(NCIP) shall be an attached agency of the Department of Land Reform

AMIN contends that since the DAR, PCUP and NCIP were created by statutes, they can only be
transformed, merged or attached by statutes, not by mere executive orders.

AMIN cites the naming of the PCUP as a presidential commission to be clearly an extension of the
President, and the creation of the NCIP as an "independent agency under the Office of the President."24
It thus argues that since the legislature had seen fit to create these agencies at separate times and with
distinct mandates, the President should respect that legislative disposition.

In fine, AMIN contends that any reorganization of these administrative agencies should be the subject
of a statute.

ISSUE/S:WON the constitutional principles of separation of powers is violated by EO 364 and 379. (No)

HELD: The Office of the President consists of the Office of the President proper and the agencies under
it. PCUP and NCIP were formed as agencies under the Office of the President. The "Agencies under the
Office of the President" refer to those offices placed under the chairmanship of the President, those
under the supervision and control of the President, those under the administrative supervision of the
Office of the President, those attached to the Office for policy and program coordination, and those that
are not placed by law or order creating them under any special department.
As thus provided by law, the President may transfer any agency under the Office of the President to
any other department or agency, subject to the policy in the Executive Office and in order to achieve
simplicity, economy and efficiency. Gauged against these guidelines, the challenged executive orders
may not be said to have been issued with grave abuse of discretion or in violation of the rule of law.

The characterization of the NCIP as an independent agency under the Office of the President does not
remove said body from the President's control and supervision with respect to its performance of
administrative functions.

The Administrative Code of 1987 categorizes administrative relationships into (1) supervision and
control, (2) administrative supervision, and (3) attachment. With respect to the third category, it has been
held that an attached agency has a larger measure of independence from the Department to which it is
attached than one which is under departmental supervision and control or administrative supervision.
This is borne out by the "lateral relationship" between the Department and the attached agency. The
attachment is merely for "policy and program coordination." Indeed, the essential autonomous character
of a board is not negated by its attachment to a commission.
 [26] [Domingo v. Zamora]
GR No. 142283| February 6, 2003 | Powers of the President | Carpio, J. | Jamilano

Petitioner: ROSA LIGAYA C. DOMINGO, ROMEO M. FERNANDEZ, VICTORIA S. ESTRADA, JULIETA C.

FAJARDO, ADELAIDA B. GAWIRAN, MARCIANO M. SERVO, VICTORIA S. DAOANG, FELICIANO N.
TOLEDO III, JAYNELYN D. FLORES, MA. LIZA B. LLOREN, ROMELIA A. CONTAPAY, MARIVIC B.
TOLITOL, PAZ LEVITA G. VILLANUEVA, EDITHA C. HERNANDEZ, JOSE HERNANDEZ, JR., VERONICA C.
BELLES, AMELITA S. BUCE, MERCELITA C. MARANAN, CRISTITUTO C. LLOREN, HERNANDO M.
EVANGELISTA, and CARLOS BACAY, JR.
Respondents: HON. RONALDO D. ZAMORA, in his capacity as the Executive Secretary, HON. ANDREW
B. GONZALES, in his capacity as the Secretary of Education, and HON. CARLOS D. TUASON, in his
capacity as the Chairman of the Philippine Sports Commission

Case Doctrine :Under Section 31 (1) of EO 292, the President can reorganize the Office of the
President Proper by abolishing, consolidating or merging units, or by transferring functions from one
unit to another.

FACTS:
1. This is a petition for certiorari and prohibition with prayer for temporary restraining order seeking to
nullify Executive Order No. 81 and Memoranda Nos. 01592 and 01594 issued by former President
Joseph E. Estrada. The assailed executive order transferred the sports development programs and
activities of the Department of Education, Culture and Sports ("DECS" for brevity) to the Philippine
Sports Commission ("PSC" for brevity). The questioned memoranda ("DECS Memoranda" for brevity),
on the other hand, reassigned all Bureau of Physical Education and School Sports ("BPESS" for brevity)
personnel named in the DECS Memoranda to various offices within the DECS.

2. Petitioners were among the BPESS personnel affected by Memorandum No. 01594. Dissatisfied with
their reassignment, petitioners filed the instant petition. Petitioners argue that EO 81 is void and
unconstitutional for being an undue legislation by President Estrada. Petitioners maintain that the
President's issuance of EO 81 violated the principle of separation of powers. Petitioners also challenge
the DECS Memoranda for violating their right to security of tenure.

3. The Bureau of Physical Education and School Sports (BPESS) is hereby abolished. The personnel of
the BPESS, presently detailed with the PSC, are hereby transferred to the PSC without loss of rank,
including the plantilla positions they occupy. All other BPESS personnel shall be retained by the
Department.

ISSUE/S:Whether or not EO 81 and the DECS Memoranda are valid. – Yes.

HELD:This petition is dismissed for being moot and academic.

Since RA 9155 provides that BPESS personnel not transferred to the PSC shall be retained by the DECS,
petitioners now accept that "the law explicitly protects and preserves" their right to security of tenure.

Although the issue is already academic, its significance constrains the Court to point out that Executive
Order No. 292 ("EO 292" for brevity), otherwise known as the Administrative Code of 1987, expressly
grants the President continuing authority to reorganize the Office of the President.
Since EO 81 is based on the President's continuing authority under Section 31 (2) and (3) of EO 292, EO
81 is a valid exercise of the President's delegated power to reorganize the Office of the President. The
law grants the President this power in recognition of the recurring need of every President to reorganize
his office "to achieve simplicity, economy and efficiency.

Under Section 31 (1) of EO 292, the President can reorganize the OGce of the President Proper by
abolishing, consolidating or merging units, or by transferring functions from one unit to another. In
contrast, under Section 31 (2) and (3) of EO 292, the President's power to reorganize offices outside the
OFFIce of the President Proper but still within the OGce of the President is limited to merely transferring
functions or agencies from the OFFIce of the President to Departments or Agencies, and vice versa.
 [27] [Bagaoisan v. National Tobacco Administration]
G.R. No. 152845 | August 5, 2003 | Power to Create Public Office and Reorganize | Vitug, J. | Grefal

Petitioner: Drianita Bagaoisan, Fely Madriaga, Shirly Tagaban, Ricardo Sarandi, Susan Imperial,
Benjamin Demdem, Rodolfo Daga, Edgardo Baclig, Gregorio Labayan, Hilario Jerez, and Maria Corazon
Cuanang (Rank and file employees of NTA who were terminated and were not considered in the OSSP)
Respondents: National Tobacco Administration

Case Doctrine: The Constitution expressly grants the President control of all executive departments,
bureaus, agencies and offices which may justify an executive action to inactivate functions of a
particular office or to carry out reorganization measures under a broad authority of law.

FACTS: President Joseph Estrada issued Executive Order No. 29 entitled “Mandating the Streamlining
of the National Tobacco Administration (NTA)” and Executive Order No. 36, providing for a new staffing
pattern. In compliance therewith, the NTA prepared and adopted a new Organization Structure and
Staffing Pattern (OSSP), which was submitted to the Office of the President. The OSSP was approved
by the DBM. The NTA created a placement committee to assist the authority in the selection and
placement of permanent personnel in the revised OSSP.

Petitioners, rank and file employees of NTA Batac, received individual notices of termination of their
employment with the NTA effective 30 days from receipt thereof. Petitioners filed a petition for certiorari,
prohibition and mandamus, with prayer for preliminary injunction or TRO with the RTC of Batac, Ilocos
Norte, praying that a restraining order be issued enjoining the NTA from enforcing the notice of
termination addressed to petitioners and judgment be rendered declaring the notice of termination of
petitioners illegal and the reorganization null and void and ordering their reinstatement with backwages.

The RTC ordered the NTA to appoint petitioners in the new OSSP to positions similar or comparable to
their respective former assignments. The NTA filed an appeal with the Court of Appeals, which rendered
a decision reversing and setting aside the assailed orders of the trial court. Petitioners went to the
Supreme Court to assail the decision of the CA. The SC issued a resolution denying their petition.

ISSUE/S: Whether or not the President, through an issuance of an executive order, can validly carry out
the reorganization of the NTA. (YES).

HELD: The questioned Executive Orders have not abolished the National Tobacco Administration but
merely mandated its reorganization through the streamlining or reduction of its personnel.

Article VII, Section 17 of the Constitution expressly grants the President control of all executive
departments, bureaus, agencies and offices which may justify an executive action to inactivate
functions of a particular office or to carry out reorganization measures under a broad authority of law.
Section 78 of the General Appropriations act of FY 1998 has decreed that the President may direct
changes in the organization and key positions in any department, bureau or agency pursuant to Article
VI, Section 25, of the Constitution, which grants to the Executive Department the authority to recommend
the budget necessary for its operation. This includes the authority to evaluate each and every
government agency, including the determination of the most economical and efficient staffing pattern,
under the Executive Department.
In Rosa Ligaya C. Domingo, et al. v. Hon. Ronaldo D. Zamora, in his capacity as the Executive Secretary, et
al., this Court has had occasion to delve on the President’s power to reorganize the Office of the
President under Section 31(2) and (3) of Executive Order No. 292 and the power to reorganize the Office
of the President Proper. Section 31, Book III, Chapter 10 of EO 292 (Administrative Code) provides:

"SEC. 31. Continuing Authority of the President to Reorganize his Office. – The President,
subject to the policy in the Executive Office and in order to achieve simplicity, economy and
efficiency, shall have continuing authority to reorganize the administrative structure of the
Office of the President. For this purpose, he may take any of the following actions:

"(1) Restructure the internal organization of the Office of the President Proper, including the
immediate Offices, the Presidential Special Assistants/Advisers System and the Common
Staff Support System, by abolishing, consolidating or merging units thereof or transferring
functions from one unit to another;

"(2) Transfer any function under the Office of the President to any other Department or
Agency as well as transfer functions to the Office of the President from other Departments
and Agencies; and

"(3) Transfer any agency under the Office of the President to any other department or agency
as well as transfer agencies to the Office of the President from other departments and
agencies."

The first sentence of the law is an express grant to the president of a continuing authority to reorganize
the administrative structure of the Office of the President. The succeeding numbered paragraphs are
not in the nature of provisos that unduly limit the aim and scope of the grant of the President of the
power to reorganize but are to viewed in consonance therewith.

In the present instance, the assailed action is a mere reorganization under the general provisions of the
law consisting mainly of streamlining the NTA in the interest of simplicity, economy and efficiency. It is
an act well within the authority of the President motivated and carried out, according to the findings of
the appellate court, in good faith, a factual assessment that this Court could only but accept.
 [28] BUKLOD NG KAWANI NG EIIB VS. HON. EXECUTIVE SECRETARY ZAMORA
G.R. Nos. 142801-802 | 7-10-2001 | Creation/abolition of office |SANDOVAL-GUTIERREZ, J | Garay

Petitioner: BUKLOD NG KAWANING EIIB

Respondents: HON. EXECUTIVE SECRETARY RONALDO B. ZAMORA

Case Doctrine :
(1) The general rule has always been that the power to abolish a public office is lodged with the
legislature. This proceeds from the legal precept that the power to create includes the power to
destroy. A public office is either created by the Constitution, by statute, or by authority of law.
Thus, except where the office was created by the Constitution itself, it may be abolished by the
same legislature that brought it into existence. The exception, however, is that as far as bureaus,
agencies or offices in the executive department are concerned, the President's power of control
may justify him to inactivate the functions of a particular office,or certain laws may grant him
the broad authority to carry out reorganization measures.
(2) To "deactivate" means to render inactive or ineffective or to break up by discharging or
reassigning personnel, while to "abolish" means to do away with, to annul, abrogate or destroy
completely. In essence, abolition denotes an intention to do away with the office wholly and
permanently. Thus, while in abolition, the office ceases to exist, the same is not true in
deactivation where the office continues to exist, albeit remaining dormant or inoperative. Be that
as it may, deactivation and abolition are both reorganization measures.

FACTS:On June 30, 1987, former President Corazon C. Aquino, issued Executive Order No. 1273
establishing the Economic Intelligence and Investigation Bureau (EIIB) as part of the structural
organization of the Ministry of Finance. President Aquino issued Memorandum Order No. 225 providing
that the EIIB "shall be the agency of primary responsibility for anti-smuggling operations in all land areas
and inland waters and waterways outside the areas of sole jurisdiction of the Bureau of Customs."

Eleven years after,President Joseph Estrada issued Executive Order No. 191 entitled "Deactivation of
the Economic Intelligence and Investigation Bureau." Motivated by the fact that "the designated
functions of the EIIB are also being performed by the other existing agencies of the government" and
that "there is a need to constantly monitor the overlapping of functions" among these agencies, former
President Estrada ordered the deactivation of EIIB and the transfer of its functions to the Bureau of
Customs and the National Bureau of Investigation.

Meanwhile, President Estrada issued Executive Order No. 1968 creating the Presidential Anti-
Smuggling Task Force "Aduana." President Estrada issued Executive Order No. 22310 providing that all
EIIB personnel occupying positions specified therein shall be deemed separated from the service
effective April 30, 2000, pursuant to a bona fide reorganization resulting to abolition, redundancy,
merger, division, or consolidation of positions.

Agonizing over the loss of their employment, petitioners now come before this Court invoking our power
of judicial review of Executive Order Nos. 191 and 223. Petitioners contend that the issuance of the
executive orders is: (a) a violation of their right to security of tenure; (b) tainted with bad faith as they
were not actually intended to make the bureaucracy more efficient but to give way to Task Force
"Aduana," the functions of which are essentially and substantially the same as that of EIIB; and (c) a
usurpation of the power of Congress to decide whether or not to abolish the EIIB.
Arguing in behalf of respondents, the Solicitor General maintains that: (a) the President enjoys the
totality of the executive power provided under Sections 1 and 7, Article VII of the Constitution, thus, he
has the authority to issue Executive Order Nos. 191 and 223; (b) the said executive orders were issued
in the interest of national economy, to avoid duplicity of work and to streamline the functions of the
bureaucracy; and (c) the EIIB was not "abolished," it was only "deactivated."

ISSUE/S:
(1) Whether or not the president have the authority to reorganize the executive department.
(2) Whether or not the reorganization is valid.

HELD:
(1) Yes. The general rule has always been that the power to abolish a public office is lodged with
the legislature. This proceeds from the legal precept that the power to create includes the power
to destroy. A public office is either created by the Constitution, by statute, or by authority of law.
Thus, except where the office was created by the Constitution itself, it may be abolished by the
same legislature that brought it into existence. The exception, however, is that as far as bureaus,
agencies or offices in the executive department are concerned, the President's power of control
may justify him to inactivate the functions of a particular office,or certain laws may grant him
the broad authority to carry out reorganization measures. Under Section 31, Book III of
Executive Order No. 292 (otherwise known as the Administrative Code of 1987), "the President,
subject to the policy in the Executive Office and in order to achieve simplicity, economy and
efficiency, shall have the continuing authority to reorganize the administrative structure of the
Office of the President." For this purpose, he may transfer the functions of other Departments
or Agencies to the Office of the President. In Canonizado v. Aguirre, we ruled that reorganization
"involves the reduction of personnel, consolidation of offices, or abolition thereof by reason of
economy or redundancy of functions." It takes place when there is an alteration of the existing
structure of government offices or units therein, including the lines of control, authority and
responsibility between them. The EIIB is a bureau attached to the Department of Finance. It
falls under the Office of the President. Hence, it is subject to the President's continuing
authority to reorganize.
(2) YES, VALID. In this jurisdiction, reorganizations have been regarded as valid provided they are
pursued in good faith. Reorganization is carried out in 'good faith' if it is for the purpose of
economy or to make bureaucracy more efficient. Pertinently, Republic Act No. 665628 provides
for the circumstances which may be considered as evidence of bad faith in the removal of civil
service employees made as a result of reorganization, to wit: (a) where there is a significant
increase in the number of positions in the new staffing pattern of the department or agency
concerned; (b) where an office is abolished and another performing substantially the same
functions is created; (c) where incumbents are replaced by those less qualified in terms of
status of appointment, performance and merit; (d) where there is a classification of offices in
the department or agency concerned and the reclassified offices perform substantially the
same functions as the original offices, and (e) where the removal violates the order of
separation. An examination of the pertinent Executive Orders30 shows that the deactivation of
EIIB and the creation of Task Force Aduana were done in good faith. It was not for the purpose
of removing the EIIB employees, but to achieve the ultimate purpose of E.O. No. 191, which is
economy. While Task Force Aduana was created to take the place of EIIB, its creation does not
entail expense to the government. We ruled that a reorganization in good faith is one designed
to trim the fat off the bureaucracy and institute economy and greater efficiency in its operation.
 [30] Dario v. Mison
GR No. 81954 | 8 Aug 1989 | Powers of the President | Sarmiento, J. | Saquido

Petitioner: CESAR Z. DARIO, et.al

Respondents: SALVADOR M. MISON, in his capacity as Commissioner of Customs

Case Doctrine : A reorganization is carried out in "good faith" if it is for the purpose of economy or to
make bureaucracy more eFFIcient. In that event, no dismissal (in case of a dismissal) or separation
actually occurs because the position itself ceases to exist.

FACTS:On March 25, 1986, Pres. Aquino promulgated Proclamation No. 3 (DECLARING A NATIONAL
POLICY TO IMPLEMENT THE REFORMS MANDATED BY THE PEOPLE, PROTECTING THEIR BASIC
RIGHTS, ADOPTING A PROVISIONAL CONSTITUTION, AND PROVIDING FOR AN ORDERLY
TRANSITION TO A GOVERNMENT), providing for the intention of the President to, “completely
reorganize the government, eradicate unjust and oppressive structures, and all iniquitous vestiges of the
previous regime.” Since then, the President has issued a number of executive orders and directives
reorganizing various other government offices, a number of which, with respect to elected local offIcials.
May 28, 1986, the President enacted Executive Order No. 17, "PRESCRIBING RULES AND
REGULATIONS FOR THE IMPLEMENTATION OF SECTION 2, ARTICLE III OF THE FREEDOM
CONSTITUTION." Executive Order No. 17 recognized the "unnecessary anxiety and demoralization
among the deserving oKcials and employees" the ongoing government reorganization had generated,
and prescribed as "grounds for the separation/replacement of personnel.

On January 30, 1987, Pres. Aquino promulgated E.O. No. 127, “Reorganizing the Ministry of Finance”,
where, on January 6, 1988 Incumbent commissioner Mison issued a memorandum in the nature of
“Guidelines on the Implementation of Reorganization Executive orders”. In the same date the
commissioner constituted a Reorganization Appeals board charged with adjudicating appeals from
removals under the above memorandum. On the same date he addressed several notices invoking Sec.
59 of EO 127, and issued separation notices to a total of 394 officials, including the petitioner, Cesar
Dario, in his capacity as Deputy Commissioner. Thus, Cesar Dario petitioned for reinstatement on the
ground that the Provisional Constitution giving the power to dismiss public officials without cause ended
on February 25, 1987, seeing as the public officials enjoyed security of tenure under the provisions of
the 1987 Constitution. However, respondent Commissioner Mison contended that Sec. 16, Article XVIII
(Transitory Provisions) allows the reorganization of the Bureau of Customs under E.O. No. 127
(authorizing separation without cause) to continue even after the ratification of the 1987 Constitution –
citing the case of Jose v. Arroyo, wherein the Court decided in favor of a similar notion. Thus, there was
no violation of security of tenure.

The Civil Service Commission, nevertheless, ordered the reinstatement of the petitioner

ISSUE/S: Whether or not the 1987 Constitution grants license upon the Government to remove career
public officials it could have validly done under an "automatic"-vacancy-authority and to remove them
without rhyme or reason. (NO)

HELD:The court held that the authority to remove public oFFIcials under the Provisional Constitution
ended on February 25, 1987, advanced by jurisprudence to February 2, 1987. 70 It can only mean, then,
that whatever reorganization is taking place is upon the authority of the present Charter (1987
Constitution), and necessarily, upon the mantle of its provisions and safeguards. According to the
court’s holding in Esguerra and Palma-Fernandez, in which we categorically declared that after February
2, 1987, incumbent oFFIcials and employees have acquired security of tenure, which is not a deterrent
against separation by reorganization under the quondam fundamental law.

Reorganization under the aegis of the 1987 Constitution is not as stern as reorganization under the prior
Charter. Whereas the latter, sans the President's subsequently imposed constraints, envisioned a
purgation, the same cannot be said of the reorganization inferred under the new Constitution because,
precisely, the new Constitution seeks to usher in a democratic regime. But even if we concede ex gratia
argumenti that Section 16 is an exception to due process and no-removal-"except for cause provided by
law" principles enshrined in the very same 1987 Constitution, which may possibly justify removals "not
for cause," there is no contradiction in terms here because, while the former Constitution left the axe to
fall where it might, the present organic act requires that removals "not for cause" must be as a result of
reorganization. As we observed, the Constitution does not provide for "automatic" vacancies. It must
also pass the test of good faith — a test not obviously required under the revolutionary government
formerly prevailing, but a test well-established in democratic societies and in this government under
a democratic Charter.

When, therefore, Arroyo permitted a reorganization under Executive Order No. 127 after the ratiFIcation
of the 1987 Constitution, Arroyo (Jose v Arroyo case) permitted a reorganization provided that it is done
in good faith. Otherwise, security of tenure would be an insuperable impediment.

Reorganizations in this jurisdiction have been regarded as valid provided they are pursued in good faith.
As a general rule, a reorganization is carried out in "good faith" if it is for the purpose of economy or to
make bureaucracy more eFFIcient. In that event, no dismissal (in case of a dismissal) or separation
actually occurs because the position itself ceases to exist. And in that case, security of tenure would
not be a Chinese wall. Be that as it may, if the "abolition," which is nothing else but a separation or
removal, is done for political reasons or purposely to defeat security of tenure, or otherwise not in good
faith, no valid "abolition" takes place and whatever "abolition" is done, is void ab initio. There is an
invalid "abolition" as where there is merely a change of nomenclature of positions, or where claims of
economy are belied by the existence of ample funds.

It is to be stressed that by predisposing a reorganization to the yardstick of good faith, we are not, as a
consequence, imposing a "cause" for restructuring. Retrenchment in the course of a reorganization in
good faith is still removal "not for cause," if by "cause" we refer to "grounds" or conditions that call for
disciplinary action.

Good faith, as a component of a reorganization under a constitutional regime, is judged from the facts
of each case.

Hence, the President could have validly removed government employees, elected or appointed, without
cause but only before the effectivity of the 1987 Constitution on February 2, 1987 (De Leon v. Esguerra,
supra ; Palma-Fernandez vs. De la Paz, supra); in this connection, Section 59 (on non-reappointment of
incumbents) of Executive Order No. 127 cannot be a basis for termination.

FACTS:
Pres. Aquino promulgated Proclamation No. 3, providing for the intention of the President to,
“completely reorganize the government, eradicate unjust and oppressive structures, and all iniquitous
vestiges of the previous regime.” Subsequently, Pres. Aquino promulgated E.O. No. 127, “Reorganizing
the Ministry of Finance”, where, in Sec. 59, it provided for the reorganization of the Bureau of Customs.
Pursuant to the reorganization, Commissioner issued separation notices to a total of 394 officials,
including the petitioner, Cesar Dario, in his capacity as Deputy Commissioner.

Thus, Cesar Dario petitioned for reinstatement on the ground that the Provisional Constitution giving the
power to dismiss public officials without cause ended on February 25, 1987, seeing as the public
officials enjoyed of tenure under the provisions of the 1987 Constitution. However, respondent
Commissioner contended that Sec. 16, Article XVIII (Transitory Provisions) allows the reorganization of
the Bureau of Customs under E.O. No. 127 (authorizing separation without cause) to continue even after
the ratification of the 1987 Constitution – citing the case of Jose v. Arroyo, wherein the Court decided
in favor of a similar notion. Thus, there was no violation of security of tenure.

The Civil Service Commission, nevertheless, ordered the reinstatement of the petitioner. Whereas, the
respondent motioned for reconsideration.

ISSUE:

Does E.O. No. 127, providing reorganization, allow the “separation” of Dario from the Bureau of Customs
despite his right to security of tenure under the 1987 Constitution?

HELD:

No. The Court held that E.O. No. 127, providing reorganization, does not allow the “separation” of Dario
from the Bureau of Customs despite his right to security of tenure under the 1987 Constitution.

In line with this, the Court maintains that reorganization entails that an office is abolished, thus there
actually no separation or dismissal such that these concepts imply that there is an office to be separated
from. However, the Court asserts that reorganizations abolishing an office would only be valid if it
passes the test of good faith. A Reorganization carried out in good faith must have for its purpose the
efficiency of both the economy and bureaucracy. In this case, there is lack of good faith such that there
is no showing that legitimate structural changes were made, only that personnel were reduced. Thus,
it cannot be said that it was done by reason of economy or redundancy of functions. Thus, since there
is lack of good faith, there is no valid reorganization that would allow the “separation” of the
petitioners, in keeping with their security of tenure. The act of reorganization of the Bureau of Customs
dismissing Dario is unconstitutional

[30] [BLAQUERA v CSC]

FACTS:

1. To carry out said reorganization, and pursuant to Executive Order No. 165 of May 5, 1987 which
abolished the Commission of Government Reorganization and transferred its remaining functions1 to
the Department of Budget and Management (DBM for brevity), DENR Secretary Fulgencio S. Factoran,
Jr. submitted to the DBM a staffing pattern consisting of 28,106 positions. The DBM approved only
22,956 positions and the petitioners' positions were among those trimmed off the new plantilla. As the
lean plantilla did not meet the manpower requirements of the DENR, Secretary Factoran submitted a
staffing pattern consisting of 24,614 positions.

2. On July 4, 1988, the DBM released a revised staffing pattern containing 23,612 positions only which
was 1,002 positions less than what the DENR Secretary requested and which still did not include the
positions of the petitioners.

3. On July 29, 1988, the DENR requested the DBM to restore 839 positions which DBM had disapproved
earlier. The request was approved on September 14, 1988 after long negotiations between the DENR
and DBM, subject to the condition that these positions shall be coterminous with the appointees but not
to exceed three (3) years.

4. Meanwhile, on June 10, 1988, Republic Act No. 6656 "An Act to Protect the Security of Tenure of
Civil Service Officers and Employees In the Implementation of Government Reorganization," was
passed. Section 11 thereof orders all departments and agencies to complete the 1987 reorganization of
the executive branch within ninety (90) days from the approval of the law, or on or before September 8,
1988.

5. The directors of the affected bureaus requested the DENR and DBM Secretaries to convert the
coterminous positions to permanent. The DENR Secretary favorably endorsed their request citing
changes in the functions of the DENR as justification for the request The request was reiterated by the
DENR Assistant Secretary for Services Management but it was denied on December 19, 1990 by DBM
Secretary Guillermo Carague.

6. The DENR Secretary's motion for reconsideration was not acted upon by Secretary Carague.

7. Meanwhile, the General Appropriations Act of FY 1991 provided for the salaries of the coterminous
employees in the DENR until December 31 ,1991.

8. On August 6, 1991, DENR Secretary Factoran submitted a memorandum to President Aquino, through
Executive Secretary Franklin Drilon, requesting that the 597 coterminous positions of the DENR be
extended up to December 31, 1991, without prejudice to DBM's action on his (Secretary Factoran's)
motion for reconsideration. The Office of the President granted the request.

9. But as Secretary Factoran's request for reconsideration of Secretary Carague's order remained
unacted upon, the petitioners filed in this Court on December 19, 1991, the present petition for prohibition
and mandamus with a prayer for the issuance of a restraining order/preliminary injunction.

ISSUE/S:

1. W/N the impending mass dismissal of petitioners from employment on December 31, 1991 would
violate their right to security of tenure and the provisions of Republic Act. No. 6656;

2. Whether or not there was a valid reorganization - No

The Supreme Court finds merit in the petition.

Good faith, in the case of Dario vs Mison, is a basic ingredient for the validity of any government
reorganization. It is the golden thread that holds together the fabric of the reorganization. Without it, the
cloth would disintegrate. “Reorganization is a recognized valid ground for separation of civil service
employees, subject only to the condition that it be done in good faith. No less than the Constitution itself
in Sec. 16 of the Transitory Provisions, together with Section 33 and 34 of EO No. 81 and Sec. 9 of RA
No. 6656, support this conclusion with the declaration that all those not so appointed in the
implementation of said reorganization shall be deemed separated from the service with the concomitant
recognition of their entitlement to appropriate separation benefits and/or retirement plans of the
reorganized government agency.

A reorganization in good faith is one designed to trim the fat off the bureaucracy and institute economy
and greater efficiency in its operation. It is not a mere tool of the spoils system to change the face of
the bureaucracy and destroy the livelihood of hordes of career employees in the civil service so that the
new-powers-that-be may put their own people in control of the machinery of government.

"Reorganization in this jurisdiction has been regarded as valid provided they are pursued in good faith.
As a general rule, a reorganization is carried out in 'good faith' if it is for the purpose of the economy or
to make bureaucracy more efficient. In that event, no dismissal (in case of dismissal) or separation
actually occurs because the position itself ceases to exist. And in that case, security of tenure would not
be a Chinese wall. Be that as it may, if the 'abolition,' which is nothing else but a separation or removal,
is done for political reasons or purposely to defeat security of tenure, or otherwise not in good faith, no
valid

'abolition' takes place and whatever 'abolition' is done, is void ab initio. There is an invalid 'abolition' as
where there is merely a change of nomenclature of positions, or where claims of economy are belied by
the existence of ample funds." (Dario vs. Mison, 176 SCRA 84, 92-93.)There is no dispute over the power
to reorganize — whether traditional, progressive, or whatever adjective is appended to it. However, the
essence of constitutional government is adherence to basic rules. The rule of law requires that no
government official should feel free to do as he pleases using only his avowedly sincere intentions and
conscience to guide him. The fundamental standards of fairness embodied in the bona fide rule cannot
be disregarded. More particularly, the auto-limitations imposed by the President when she proclaimed
the Provisional Constitution and issued executive orders as sole lawmaker and the standards and
restrictions prescribed by the present Constitution and the Congress established under it, must be
obeyed. Absent this compliance, we cannot say that a reorganization is bona fide." (Mendoza vs.
Quisumbing, 186 SCRA 108.) "In fact, the right of the State to reorganize the Government resulting in the
separation of career civil service employees under the 1987 Constitution is beyond dispute, but as
emphasized in the Mison case (G.R. Nos. 81954, 81967 and 82023, August 8, 1989) and in the cases of
Bondoc vs. Sec. of Science and Technology (G.R. No. 83025), Quisumbing vs. Tupas (G.R. No. 87401)
and Hamed vs. Civil Service Commission (G.R. No. 89069), all of which having been promulgated on July
19, 1990, said reorganization, ouster, and appointments of successors must be made in GOOD FAITH."
(Siete vs. Santos, 190

There appears to be no sufficient justification for the reorganization of the DENR, as revised by the
DBM. The fact that Section 25 of E.O. No. 192 changed the status of all the officers and employees of
the DENR from permanent or regular to mere "hold-overs," flagrantly violating the employees’ right to
due process, taints the reorganization process. Section 25 provides: "SEC. 25. New Structure and
Pattern. — Upon approval of this Executive Order, the officers and employees of the Department shall in
a hold-over capacity, continue to perform their respective duties and responsibilities and receive the
corresponding salaries and benefits unless in the meantime they are separated from government
service. ". . . Those incumbents whose positions are not included therein, or, who are not reappointed,
shall be deemed separated from the service. . . ." . . . In Mendoza vs. Quisumbing, 186 SCRA 108, the
Court noted the pernicious effect of the "hold-over" provision (Sec. 24) in Executive Order No. 117
reorganizing the Department of Education and Culture which uprooted thousands of school teachers
and employees, thus: ". . . Pursuant to the above provision [Sec. 24, E.O. No. 117], around 400,000 school
teachers, janitors, clerks, principals, supervisors, administrators, and higher officials were placed on
'hold-over status.' When a public officer is placed on hold-over status, it means that his term has expired
or his services terminated but he should continue holding his office until his successor is appointed or
chosen and has qualified. That the reorganization of the DENR was not intended to achieve economy
and efficiency, is revealed by the admission in page 16 of the public respondents' Comment that the
new staffing pattern of the department contains "991 positions more than the total number of permanent
positions in the DENR before the reorganization." In fact, DENR Secretary Fulgencio Factoran (who is
presumed to know better than anyone else the needs of his department) had urged the DBM to restore
the positions of the petitioners because they are "vital to the functions, mandates and objectives of the
DENR." Since the abolition of their positions will not conduce to either "efficiency" or "economy" in the
Service, which are the principal justifications for any government overhaul, then, obviously, the
reorganization of the DENR is not justified. The conversion of the petitioners from permanent to
“coterminous" employees is a wholesale demotion of personnel which is tantamount to removal without
cause and without due process."
 [31] [Aurora Cerilles v CSC]

G.R. No. 180845| June 6, 2018 | Administrative Agencies | Caguioa | Hidalgo, Carlos

Petitioner: Aurora Cerilles

Respondents: CIvil Service Commission

Case Doctrine : CSC is mandated by RA 665 to protect tenure of permanent employees in case of a
reorganization in bad faith. The CSC, as the central personnel agency, has the obligation to implement
and safeguard the constitutional provisions on security of tenure and due process.Officers and
employees holding permanent appointments shall be given preference for appointment to the new
positions in the approved staffing pattern comparable to their former positions or in case there are not
enough comparable positions, to positions next lower in rank. No new employees shall be taken in until
all permanent officers and employees have been appointed. there is no encroachment on the discretion
of the appointing authority when the CSC revokes an appointment on the ground that the removal of the
employee was done in bad faith. In such instance, the CSC is not actually directing the appointment of
another but simply ordering the reinstatement of the illegally removed employee.

FACTS:A Republic act was passed creating the province of Zamboanga Sibugay from the Province of
Zamboanga del Sur. Because of this the Internal Revenue allotment of Zamboanga del sur was cut.
Thereafter, Governor Cerilles of Del sur sought opinion of CSC REGARDING REDUCING THE
WORKFORCE IN THE PROVINCIAL GOVERNMENT, CSC opined to wait for a sangguniang panlalawigan
resolution. A SP resolution was passed approving a new staffing pattern of 727 positions.

Private respondents were occupying permanent positions in the old plantilla but were not given
placement preference and were terminated without valid cause. They appealed by writing a letter to the
governor as required by sec and 8 of RA 6656 BUT IT WAS NOT ACTED UPON. They thereafter appealed
to the CSC regional office.

CSC regional office ruled that the new appointments of Gov. Cerilles violated RA 65 FOR FAILING TO
GRANT PREFERENCE to employees previously holding permanent positions in the old plantilla. CSCRO,
invalidated 96 appointments by Gov. Cerilles. Gov. Cerilles argued that it is not within the prerogative of
the CSC to revoke the appointments since it was within her exclusive discretion. CSC upheld ruling of
the regional office and Cerilles appealed to the CA which was dismissed. Respondents thereafter filed
motions for execution of judgement to have them reinstated

ISSUE/S: Whether or not the CSC may revoke an appointment for violating the provisions of RA 6656
(YES)

HELD:Officers and employees holding permanent appointments shall be given preference for
appointment to the new positions in the approved staffing pattern comparable to their former positions
or in case there are not enough comparable positions, to positions next lower in rank. No new employees
shall be taken in until all permanent officers and employees have been appointed.

First, an officer or employee may be validly removed from service pursuant to a bona fide reorganization;
in such case, there is no violation of security of tenure and the aggrieved employee has no cause of
action against the appointing authority. Second, if, on the other hand, the reorganization is done in bad
faith, as when the enumerated circumstances in Section 2 are present, the aggrieved employee, having
been removed without valid cause, may demand for his reinstatement or reappointment. Third, officers
and employees holding permanent appointments in the old staffing pattern shall be given preference for
appointment to the new positions in the approved staffing pattern, which shall be comparable to their
former position or in case there are not enough comparable positions, to positions next lower in rank.
Lastly, no new employees shall be taken in until all permanent officers and employees have been
appointed unless such positions are policy-determining, primarily confidential, or highly technical in
nature.

Appointment, by its very nature, is a highly discretionary act. In certain occasions, however, the selection
of the appointing authority is subject to review by respondent CSC as the central personnel agency of
the Government. In countless occasions, the Court has ruled that the only function of the CSC is merely
to ascertain whether the appointee possesses the minimum requirements under the law; if it is so, then
the CSC has no choice but to attest to such appointment. there is no encroachment on the discretion of
the appointing authority when the CSC revokes an appointment on the ground that the removal of the
employee was done in bad faith. In such instance, the CSC is not actually directing the appointment of
another but simply ordering the reinstatement of the illegally removed employee

The reorganization of Zamboanga was done in bad faith. As a general rule, a reorganization is carried
out in "good faith" if it is for the purpose of economy or to make bureaucracy more efficient. In that event
no dismissal or separation actually occurs because the position itself ceases to exist. First, the sheer
number of appointments found to be violative of RA 6656 is Astounding. Second, Respondents were
replaced by either new employees or those holding lower positions in the old staffing pattern —
circumstances that may be properly appreciated as evidence of bad faith pursuant to Section 2 and
Section 4 of RA 6656. Section 4 of R.A. No. 6656 explicitly states that no new employees shall be taken
in until all permanent officers shall have been appointed for permanent position.
C. Ordinance Powers

SECTION 2. Executive Orders.—Acts of the President providing for rules of a general or permanent
character in implementation or execution of constitutional or statutory powers shall be promulgated in
executive orders.

SECTION 3. Administrative Orders.—Acts of the President which relate to particular aspects of

governmental operations in pursuance of his duties as administrative head shall be promulgated in
administrative orders.

SECTION 4. Proclamations.—Acts of the President fixing a date or declaring a status or condition of

public moment or interest, upon the existence of which the operation of a specific law or regulation is
made to depend, shall be promulgated in proclamations which shall have the force of an executive order.

SECTION 5. Memorandum Orders.—Acts of the President on matters of administrative detail or of

subordinate or temporary interest which only concern a particular officer or office of the Government
shall be embodied in memorandum orders.

SECTION 6. Memorandum Circulars.—Acts of the President on matters relating to internal

administration, which the President desires to bring to the attention of all or some of the departments,
agencies, bureaus or offices of the Government, for information or compliance, shall be embodied in
memorandum circulars.

SECTION 7. General or Special Orders.—Acts and commands of the President in his capacity as
Commander-in-Chief of the Armed Forces of the Philippines shall be issued as general or special orders.

[32] David vs Arroyo

GR NO. 171396, 171409, 171485, 171483, 171400, 171489, 171424 | May 3, 2006 | Ordinance
Power | Merle

Petitioners: PROF. RANDOLF S. DAVID, LORENZO TAÑADA III, RONALD LLAMAS, H. HARRY L.
ROQUE, JR., JOEL RUIZ BUTUYAN, ROGER R. RAYEL, GARY S. MALLARI, ROMEL REGALADO
BAGARES, CHRISTOPHER F.C. BOLASTIG

NIÑEZ CACHO-OLIVARES AND TRIBUNE PUBLISHING CO., INC

FRANCIS JOSEPH G. ESCUDERO, JOSEPH A. SANTIAGO, TEODORO A. CASINO, AGAPITO A.

AQUINO, MARIO J. AGUJA, SATUR C. OCAMPO, MUJIV S. HATAMAN, JUAN EDGARDO ANGARA,
TEOFISTO DL. GUINGONA III, EMMANUEL JOSEL J. VILLANUEVA, LIZA L. MAZA, IMEE R. MARCOS,
RENATO B. MAGTUBO, JUSTIN MARC SB. CHIPECO, ROILO GOLEZ, DARLENE ANTONINO-
CUSTODIO, LORETTA ANN P. ROSALES, JOSEL G. VIRADOR, RAFAEL V. MARIANO, GILBERT C.
REMULLA, FLORENCIO G. NOEL, ANA THERESIA HONTIVEROS-BARAQUEL, IMELDA C. NICOLAS,
MARVIC M.V.F. LEONEN, NERI JAVIER COLMENARES, MOVEMENT OF CONCERNED CITIZENS FOR
CIVIL LIBERTIES REPRESENTED BY AMADO GAT INCIONG

KILUSANG MAYO UNO, REPRESENTED BY ITS CHAIRPERSON ELMER C. LABOG AND SECRETARY
GENERAL JOEL MAGLUNSOD, NATIONAL FEDERATION OF LABOR UNIONS – KILUSANG MAYO UNO
(NAFLU-KMU), REPRESENTED BY ITS NATIONAL PRESIDENT, JOSELITO V. USTAREZ, ANTONIO C.
PASCUAL, SALVADOR T. CARRANZA, EMILIA P. DAPULANG, MARTIN CUSTODIO, JR., AND ROQUE
M. TAN

ALTERNATIVE LAW GROUPS, INC. (ALG)

JOSE ANSELMO I. CADIZ, FELICIANO M. BAUTISTA, ROMULO R. RIVERA, JOSE AMOR M.

AMORADO, ALICIA A. RISOS-VIDAL, FELIMON C. ABELITA III, MANUEL P. LEGASPI, J.B. JOVY C.
BERNABE, BERNARD L. DAGCUTA, ROGELIO V. GARCIA AND INTEGRATED BAR OF THE
PHILIPPINES (IBP)

LOREN B. LEGARDA

Respondent: PRESIDENT GLORIA MACAPAGAL-ARROYO EXECUTIVE SECRETARY EDUARDO

ERMITA, HON. AVELINO CRUZ II, SECRETARY OF NATIONAL DEFENSE, GENERAL GENEROSO
SENGA, CHIEF OF STAFF, ARMED FORCES OF THE PHILIPPINES, DIRECTOR GENERAL ARTURO
LOMIBAO, CHIEF, PHILIPPINE NATIONAL POLICE

Facts:On February 24, 2006, as the nation celebrated the 20th Anniversary of the Edsa People Power I,
President Arroyo issued Presidential Proclamation 1017 declaring a state of national emergency due to
the power vested in her by the Section 18 Article 7 of the Constitution which states that the President
may call out the armed forces to prevent and suppress rebellion. Among the effects of the proclamation
was the revocation of the permits to hold rallies, raiding of an office of a newspaper company, and an
alleged illegal arrest of various partylist representatives.

Seven petitions were filed challenging the constitutionality of PP 1017

Issue:Whether PP 1017 is constitutional? (presidential proclamation itself is constitutional but the

effects are unconstitutional)

Held:

Factual Bases of PP1017

In Integrated Bar of the Philippines v. Zamora,[12] the Court considered the President’s “calling-out”
power as a discretionary power solely vested in the Chief Executive’s wisdom. Nonetheless, it stressed
that “this does not prevent an examination of whether such power was exercised within permissible
constitutional limits or whether it was exercised in a manner constituting grave abuse of discretion.”

As to how the Court may inquire into the President’s exercise of power, the standard laid down in
Lansang v. Garcia was not correctness, but arbitrariness. The Court further ruled in Integrated Bar of
the Philippines that the burden was upon the petitioner “to show that the President’s decision is totally
bereft of factual basis,” not upon the Court to “undertake an independent investigation beyond the
pleadings.”

In the present case, petitioners failed to show that President Arroyo’s exercise of the calling-out power
through PP 1017 was factually baseless. The solicitor general’s Consolidated Comment and
Memorandum made a detailed narration of the events leading to the issuance of the proclamation.
Petitioners presented no contrary allegations; thus, the Court was convinced that the President was
justified in issuing PP 1017.

Constitutional Basis of PP1017

The operative portion of PP1017 was divided into three parts:

First provision: By virtue of the power vested upon me by Section 18, Artilce VII x x x [I] do hereby
command the Armed Forces of the Philippines, to maintain law and order throughout the Philippines,
prevent or suppress all forms of lawless violence as well any act of insurrection or rebellion

Second Provision: and to enforce obedience to all the laws and to all decrees, orders and regulations
promulgated by me personally or upon my direction

Third Provision: as provided in Section 17, Article XII of the Constitution [ I ] do hereby declare a State
of National Emergency.”

First Provision: calling out power

The Court ruled that the only criterion for the exercise of the calling-out power was “whenever it
becomes necessary x x x to prevent or suppress lawless violence, invasion or rebellion.” Owing to the
vast intelligence network of her office, the President was in the best position to determine the actual
condition of the country.

Under the calling-out power, the President may summon the armed forces to aid her in suppressing
lawless violence, invasion and rebellion through ordinary police action. But every act beyond the
President’s calling-out power is considered illegal or ultra vires.

Second Provision: Execution of laws

The second provision pertained to the power of the President to ensure that the laws be faithfully
executed, as provided in Section 17,[22] Article VII of the Constitution. The enabling clause, however,
provides that the President may “enforce obedience to all the laws and to all decrees, orders and
regulations promulgated by me personally or upon my direction.”

A reading of PP 1017 operative clause

shows that it was lifted 120 from Former President Marcos' Proclamation No. 1081, which
partly reads:

NOW, THEREFORE, I, FERDINAND E. MARCOS , President of thePhilippines by virtue of the

powers vested upon me by Article VII, Section 10,Paragraph (2) of the Constitution, do hereby
place the entire Philippines as deNned in Article 1, Section 1 of the Constitution under martial
law and, in my capacity as their Commander-in-Chief, do hereby command the Armed
Forces of the Philippines, to maintain law and order throughout the Philippines, prevent or
suppress all forms of lawless violence as well as any act of insurrection or rebellion and to
 enforce obedience to all the laws and decrees, orders and regulations promulgated by me
personally or upon my direction.

We all know that it was PP 1081 which granted President Marcos legislative power.
Its enabling clause states: "to enforce obedience to all the laws and decrees,
orders and regulations promulgated by me personally or upon my direction."

Upon the other hand, the enabling clause of PP 1017 issued by President Arroyo is: to enforce
obedience to all the laws and to all decrees, orders and regulations
promulgated by me personally or upon my direction."

Is it within the domain of President Arroyo to promulgate "decrees"?

PP 1017 states in part: "to enforce obedience to all the laws and decrees . . . promulgated by me
personally or upon my direction."

The President is granted an Ordinance Power under Chapter 2, Book III of Executive
Order No. 292 (Administrative Code of 1987). She may issue any of the following:

Sec. 2. Executive Orders. — Acts of the President providing for rules of a general or permanent
character in implementation or execution of constitutional or statutory powers shall be promulgated in
executive orders.

Sec. 3. Administrative Orders. — Acts of the President which relate to particular aspect of
governmental operations in pursuance of his duties as administrative head shall be promulgated in
administrative orders.

Sec. 4. Proclamations. — Acts of the President Nxing a date or declaring a status or condition of public
moment or interest, upon the existence of which the
operation of a speciNc law or regulation is made to depend, shall be promulgated
in proclamations which shall have the force of an executive order.

Sec. 5. Memorandum Orders. — Acts of the President on matters of administrative detail or of

subordinate or temporary interest which only concern a particular office or office of the Government
shall be embodied in memorandum
Orders.

Sec. 6. Memorandum Circulars. — Acts of the President on matters relating to internal administration,
which the President desires to bring to the attention of
all or some of the departments, agencies, bureaus or oKces of the Government,
for information or compliance, shall be embodied in memorandum circulars.

Sec. 7. General or Special Orders. — Acts and commands of the President

in his capacity as Commander-in-Chief of the Armed Forces of the Philippines
shall be issued as general or special orders.

President Arroyo's ordinance power is limited to the foregoing issuances. She

cannot issue decrees similar to those issued by Former President Marcos under PP
1081. Presidential Decrees are laws which are of the same category and binding force as
statutes because they were issued by the President in the exercise of his legislative power
during the period of Martial Law under the 1973 Constitution.
This Court rules that the assailed PP 1017 is unconstitutional insofar as it grants President Arroyo the
authority to promulgate "decrees." Legislative power is peculiarly within the province of the Legislature.
Section 1, Article VI categorically states that "[t]he legislative power shall be vested in the Congress of
the Philippines which shall consist of a Senate and a House of Representatives." To be sure, neither
Martial Law nor a state of rebellion nor a state of emergency can justify President Arroyo's exercise of
legislative power by issuing decrees.

Can President Arroyo enforce obedience to all decrees and laws through the
Military?

As this Court stated earlier, President Arroyo has no authority to enact decrees. It
follows that these decrees are void and, therefore, cannot be enforced. With respect to
"laws," she cannot call the military to enforce or implement certain laws, such as customs
laws, laws governing family and property relations, laws on obligations and contracts and
the like. She can only order the military, under PP 1017, to enforce laws pertinent to its
duty to suppress lawless violence.