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Adjudicatory Powers A. Quasi-judicial power and quasi-judicial body, defined Smart Communications vs NTC G.R. No. 151908 12 August 2003

Facts: Petitioners Isla Communications Co., Inc. and Pilipino Telephone Corporation filed against the National Telecommunications Commission, an action for declaration of nullity of NTC Memorandum Circular No. 13-6-2000 (the Billing Circular). Petitioners allege that the NTC has no jurisdiction to regulate the sale of consumer goods such as the prepaid call cards since such jurisdiction belongs to the Department of Trade and Industry under the Consumer Act of the Philippines; that the Billing Circular is oppressive, confiscatory and violative of the constitutional prohibition against deprivation of property without due process of law; that the Circular will result in the impairment of the viability of the prepaid cellular service by unduly prolonging the validity and expiration of the prepaid SIM and call cards; and that the requirements of identification of prepaid card buyers and call balance announcement are unreasonable. Hence, they prayed that the Billing Circular be declared null and void ab initio. Issue :WON the RTC has jurisdiction over the case Held: Petitions are granted. The issuance by the NTC of Memorandum Circular No. 136-2000 and its Memorandum dated October 6, 2000 was pursuant to its quasi-legislative or rule-making power. As such, petitioners were justified in invoking the judicial power of the Regional Trial Court to assail the constitutionality and validity of the said issuances. What is assailed is the validity or constitutionality of a rule or regulation issued by the administrative agency in the performance of its quasi-legislative function, the regular courts have jurisdiction to pass upon the same. The determination of whether a specific rule or set of rules issued by an administrative agency contravenes the law or the constitution is within the jurisdiction of the regular courts. Indeed, the Constitution vests the power of judicial review or the power to declare a law, treaty, international or executive agreement, presidential decree, order, instruction, ordinance, or regulation in the courts, including the regional trial courts.25 This is within the scope of judicial power, which includes the authority of the courts to determine in an appropriate action the validity of the acts of the political departments.26 Judicialx power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable, and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.

Not to be confused with the quasi-legislative or rule-making power of an administrative agency is its quasi-judicial or administrative adjudicatory power. This is the power to hear and determine questions of fact to which the legislative policy is to apply and to decide in accordance with the standards laid down by the law itself in enforcing and administering the same law. The administrative body exercises its quasi-judicial power when it performs in a judicial manner an act which is essentially of an executive or administrative nature, where the power to act in such manner is incidental to or reasonably necessary for the

performance of the executive or administrative duty entrusted to it. In carrying out their quasi-judicial functions, the administrative officers or bodies are required to investigate facts or ascertain the existence of facts, hold hearings, weigh evidence, and draw conclusions from them as basis for their official action and exercise of discretion in a judicial nature. Santiago, Jr. vs Bautista 32 SCRA 188
Facts: The appellant was a grade 6 pupil in a certain public elementary school. As the school year was then about to end, the "Committee On the Rating Of Students For Honor" was constituted by the teachers concerned at said school for the purpose of selecting the "honor students" of its graduating class. With the school Principal, as chairman, and the members of the committee deliberated and finally adjudged Socorro Medina, Patricia Ligat and Teodoro C. Santiago, Jr. as first, second and third honors, respectively. The school's graduation exercises were thereafter set for May 21, 1965; but three days before that date, the "third placer" Teodoro Santiago, Jr., represented by his mother, and with his father as counsel, sought the invalidation of the "ranking of honor students" thus made, by instituting the above-mentioned civil case in the Court of First Instance of Cotabato, committee members along with the District Supervisor and the Academic Supervisor of the place. Issue: WON the committee committed grave abuse of discretion Held: "'NO GRAVE ABUSE OF DISCRETION "Allegations relating to the alleged 'grave abuse of discretion' on the part of teachers refer to errors, mistakes, or irregularities rather than to the real grave abuse of discretion that would amount to lack of jurisdiction. Mere commission of errors in the exercise of jurisdiction may not be corrected by means of certiorari. WHAT ARE JUDICIAL OR QUASI JUDICIAL ACTS? It is difficult, if not impossible, precisely to define what are judicial or quasi judicial acts, and there is considerable conflict in the decisions in regard thereto, in connection with the law as to the right to a writ of certiorari. it is clear, however, that it is the nature of the act to be performed, rather than of the office, board, or body which performs it, that determines whether or not it is the discharge of a judicial or quasi-judicial function. It is not essential that the proceedings should be strictly and technically judicial, in the sense in which that word is used when applied to courts of justice, but it is sufficient if they are quasi judicial. It is enough if the officers act judicially in making their decision, whatever may be their public character.

The precise line of demarkation between what are judicial and what are administrative or ministerial functions is often difficult to determine. The exercise of judicial functions may involve the performance of legislative or administrative duties, and the performance of administrative or ministerial duties, may, in a measure, involve the exercise of judicial functions. It may be said generally that the exercise of judicial functions is to determine what the law 2

is, and what the legal rights of parties are, with respect to a matter in controversy; and whenever an officer is clothed with that authority, and undertakes to determine those questions, he acts judicially.

Filipinas Shell Petroleum Corp. VS. Oil Industry Commission 145 SCRA 433
Facts: Respondent Manuel B. Yap is a gasoline dealer by virtue of a "Sublease and Dealer Agreement" entered into with petitioner Pilipinas Shell Petroleum Corporation (hereinafter known as Shell) originally in the year 1965 and superseded in the year 1969. The latter was filed and registered with the OIC. While petitioner Shell complied with its contractual commitments, Manuel B. Yap defaulted in his obligations upon failure to pay for his purchases of gasoline and other petroleum products. Petitioner Shell sent demand letters to respondent Manuel B. Yap who continued to ignore these demands letters forcing petitioner Shell to exercise its contractual rights to terminate the contract. Petitioner Shell sent respondent Yap the required 90-day written notice to terminate their contract as provided for by Sec. 5 of their "Sublease and Dealer Agreement." Despite the pendency of the controversy before the ordinary civil courts, OIC persisted in asserting jurisdiction over it by rendering a decision stating it has jurisdiction to pass upon the alleged contractual right of petitioner to declare Yap's contract terminated. The OIC negated the existence of such right because the stipulation is an "unfair and onerous trade practice." Respondent OIC also allowed respondent Yap reasonable time from receipt of the decision within which to pay his judgment debt to petitioner as adjudged in a Civil Case. Petitioner Shell moved for a reconsideration but respondent OIC denied it. Issue: WON Respondent OIC has jurisdiction to hear and decide contractual disputes between a gasoline dealer and an oil company. Held: the OIC has no jurisdiction. The contentions of petitioner are well-founded. A detailed reading of the entire OIC Act will reveal that there is no express provision conferring upon respondent OIC the power to hear and decide contractual disputes between a gasoline dealer and an oil company. It is of course a well-settled principle of administrative law that unless expressly empowered, administrative agencies like respondent OIC, are bereft of quasi-judicial powers. As We declared in Miller vs. Mardo, et al (2 SCRA 898): " . . . It may be conceded that the Legislature may confer on administrative boards or bodies quasi-judicial powers involving the exercise of judgment and discretion, as incident to the performance of administrative functions, but in so doing, the legislature must state its intention in express terms that would leave no doubt, as even such quasijudicial prerogatives must be limited, if they are to be valid, only to those incidental to,

or in connection with, the performance of administrative duties which do not amount to conferment of jurisdiction over a matter exclusively vested in the courts."


Distinguished from judicial power Carino vs CHR 204 SCRA 483

Facts: Some 800 public school teachers, among them members of the Manila Public School Teachers Association (MPSTA) and Alliance of Concerned Teachers (ACT) undertook what they described as amass concerted actions" to "dramatize and highlight' their plight resulting from the alleged failure of the public authorities to act upon grievances that had time and again been brought to the latter's attention. According to them they had decided to undertake said "mass concerted actions" after the protest rally staged at the DECS premises on September 14, 1990 without disrupting classes as a last call for the government to negotiate the granting of demands had elicited no response from the Secretary of Education. Through their representatives, the teachers participating in the mass actions were served with an order of the Secretary of Education to return to work in 24 hours or face dismissal, and a memorandum directing the DECS officials concerned to initiate dismissal proceedings against those who did not comply and to hire their replacements. "For failure to heed the return-to-work order, the CHR complainants (private respondents) were administratively charged on the basis of the principal's report and given five (5) days to answer the charges. They were also preventively suspended for ninety (90) days 'pursuant to Section 41 of P.D. 807' and temporarily replaced. An investigation committee was consequently formed to hear the charges in accordance with P.D. 807." Issue: WON the Commission on Human Rights has jurisdiction, adjudicatory powers over, or the power to try and decide, or hear and determine, certain specific type of cases, like alleged human rights violation involving civil or political rights. Held: The Court declares the Commission on Human Rights to have no such power. The Constitution clearly and categorically grants to the Commission the power to investigate all forms of human rights violations involving civil and political rights. It can exercise that power on its own initiative or on complaint of any person. It may exercise that power pursuant to such rules of procedure as it may adopt and, in cases of violations of said rules, cite for contempt in accordance with the Rules of Court. In the course of any investigation conducted by it or under its authority, it may grant immunity from prosecution to any person whose testimony or whose possession of documents or other evidence is necessary or convenient to determine the truth. It may also request the assistance of any department, bureau, office, or agency in the performance of its functions, in the conduct of its investigation or in extending such remedy as may be required by its findings. But it cannot try and decide cases (or hear and determine causes) as courts of justice, or even quasi-judicial bodies do. "x x 'It may be said generally that the exercise of judicial functions is to determine what the law is, and what the legal rights of parties are, with respect to a matter in controversy; and whenever an officer is clothed with that authority, and undertakes to determine those questions, he acts judicially.'x x."

Hence it is that the Commission on Human Rights, having merely the power "to investigate," cannot and should not "try and resolve on the merits" (adjudicate) the matters involved in Striking Teachers HRC

Luzon Development Bank vs Association of LDB Employees 249 SCRA 162

Facts: From a submission agreement of the Luzon Development Bank (LDB) and the Association of Luzon Development Bank Employees (ALDBE) arose an arbitration case to resolve the following issue: Issue: WON the company has violated the Collective Bargaining Agreement provision and the Memorandum of Agreement dated April 1994, on promotion. Held: It is to be noted that the Jurisdiction conferred by law on a voluntary arbitrator or a panel of such arbitrators is quite limited compared to the original jurisdiction of the labor arbiter and the appellate jurisdiction of the National Labor Relations Commission (NLRC) for that matter. The state of our present law relating to voluntary arbitration provides that "(t)he award or decision of the Voluntary Arbitrator x x x shall be final and executory after ten (10) calendar days from receipt of the copy of the award or decision by the parties," while the "(d)ecision, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders." Hence, while there is an express mode of appeal from the decision of a labor arbiter, Republic Act No. 6715 is silent with respect to an appeal from the decision of a voluntary arbitrator.

Whats the ruling? C. Distinguished from administrative function Presidential Anti-Dollar Salting Task Force vs CA 171 SCRA 348
Facts: The petitioner, the Presidential Anti-Dollar Salting Task Force, the President's arm assigned to investigate and prosecute so-called "dollar salting" activities in the country. PADS issued search warrants against certain companies. Issue: WON the PADS is a quasi-judicial body issue search warrants under the 1973 Constitution? Held: the court ruled that PADS was not granted by law to issue a warrant of arrest. A quasi-judicial body has been defined as "an organ of government other than a court and other than a legislature, which affects the rights of private parties through either adjudication or rule making It is the basic function of these bodies to adjudicate claims and/or to determine rights, and unless its decision are seasonably appealed to the proper reviewing authorities, the same attain finality and become executory. A perusal of the Presidential Anti-Dollar Salting Task Force's organic act, Presidential Decree No. 1936, as amended by Presidential Decree No. 2002, convinces the Court that the Task Force was not meant

to exercise quasi-judicial functions, that is, to try and decide claims and execute its judgments. As the President's arm called upon to combat the vice of "dollar salting" or the blackmarketing and salting of foreign exchange, it is tasked alone by the Decree to handle the prosecution of such activities, but nothing more.

Cojuangco vs PCGG 190 SCRA 226

Facts: President Corazon C. Aquino directed the Solicitor General to prosecute all persons involved in the misuse of coconut levy funds. Pursuant to the above directive the Solicitor General created a task force to conduct a thorough study of the possible involvement of all persons in the anomalous use of coconut levy funds. Upon the creation of the PCGG under EO. 1 issued by President Aquino, the PCGG was charged with the task of assisting the President not only in the recovery of illgotten wealth or unexplained wealth accumulated by the former President, his immediate family, relatives, subordinates and close associates but also in the investigation of such cases of graft and corruption as the President may assign to the Commission from time to time and to prevent a repetition of the same in the future. Petitioner alleges that the PCGG may not conduct a preliminary investigation of the complaints filed by the Solicitor General without violating petitioner's rights to due process and equal protection of the law, and that the PCGG has no right to conduct such preliminary investigation. Issue: WON the Presidential Commission on Good Government (PCGG) has the power to conduct a preliminary investigation of the anti-graft and corruption cases filed by the Solicitor General against Eduardo Cojuangco, Jr. and other respondents for the alleged misuse of coconut levy funds. Held: the court ruled in the negative. Considering that the PCGG, like the courts, is vested with the authority to grant provisional remedies of (1) sequestration, (2) freezing assets, and (3) provisional takeover, it is indispensable that, as in the case of attachment and receivership, there exists a prima facie factual foundation, at least, for the sequestration order, freeze order or takeover order, an adequate and fair opportunity to contest it and endeavor to cause its negation or nullification. Both are assured under the foregoing executive orders and the rules and regulations promulgated by the PCGG. The general power of investigation vested in the PCGG may be divided into two stages. The first stage of investigation which is called the criminal investigation stage is the fact finding inquiring which is usually conducted by the law enforcement agents whereby they gather evidence and interview witnesses after which they assess the evidence and if they find sufficient basis, file the complaint for the purpose of preliminary investigation. The second stage is the preliminary investigation stage of the said complaint. It is at this stage, as above discussed, where it is ascertained if there is sufficient evidence to bring a person to trial. It is in such instances that we say one cannot be "a prosecutor and judge at the same time." Having gathered the evidence and filed the complaint as a law enforcer, he cannot be expected to handle with impartiality the preliminary investigation of his own complaint, this time as a public prosecutor.

The Court holds that a just and fair administration of justice can be promoted if the PCGG would be prohibited from conducting the preliminary investigation of the complaints subject of this petition and the petition for intervention and that the records of the same should be forwarded to the Ombudsman, who as an independent constitutional officer has primary jurisdiction over cases of this nature, to conduct such preliminary investigation and take appropriate action.

Sideco vs Sarenas, 41 Phil. 80

Facts: Two parties, Crispulo Sideco on the one hand, and Leocadio Sarenas and Rufino Sarenas on the other hand, claim the exclusive right to the use of the waters flowing through the estero for irrigation purposes. The claim of Sideco goes back to 1885 when the predecessor in interest of his father constructed a dam in these waters; the use of the dam was afterwards interrupted by outside causes such as imprisonment and war, but again reasserted in 1911, 1915, and 1916. Exactly what the two Sarenas' contention is not quite clear on the facts before us. However, it appears that they made application to the Director of Public Works, only to meet with the opposition of Sideco, and that the Director of Public Works, with the approval of the Secretary of Commerce and Communications, granted the two Sarenas the right, in preference to all other persons, to use the waters of the estero Bangad. Sideco then took the proceedings to the Court of First Instance of Nueva Ecija. After trial, judgment was entered, dismissing the complaint and the appeal of Sideco and confirming the decision of the administrative authorities, with the costs against the plaintiff. The further appeal of Sideco to this court, while conceding the correctness of the findings of the trial court, squarely challenges its judgment. Issue: WON the Director of public works has jurisdiction over the case? Held: Administrative machinery for the settlement of disputes as to the use of waters is provided by the Irrigation Act, as amended. Controversies must be submitted to the Secretary of Commerce and Communications through the Director of Public Works. The "decision" of the Secretary thereon is final "unless appeal therefrom be taken to the proper court within. thirty days after the date of the notification of the parties of said decision. In case of such appeal the court having jurisdiction shall try the controversy de novo." (See. 4.) A more extensive method is also provided, somewhat akin to our cadastral system, which makes it the duty of the Director of Public Works to make a technical examination of streams and to prepare a list of priorities. In the performance of this work, the Director of Public Works or any official especially authorized by him, may examine witnesses under oath, and can issue for this purpose subpoenas and subpoenas duces tecum. (Secs. 8, 41.) Certificates signed by the Secretary of Commerce and Communications are then granted each appropriator. (Secs. 9, 18.) "Appeal" lies from the "decision" of the Director of Public Works, as approved by the Secretary of Commerce and Communications, to the Court of First Instance of the province in which the property is situated. Such action must be brought within ninety days of the date of the publication of the approved list of priorities. (Sec. 10.) DECISION OF DIRECTOR OF PUBLIC WORKS AS PART OF JUDICIAL RECORD.-The decision of the Director of Public Works, affirmed by the Secretary of

Commerce and Communications, containing as it does the technical findings of officers especially qualified in irrigation engineering, should invariably be made a part of the judicial record because (1) the determination of these officials would be most useful to the courts, and (2) the exact date of the decision is of moment since it decides whether the appeal was taken in time.

Ocampo vs US 234 US 91 D. Distinguished from legislative power or rule-making Lupangco vs CA 160 SCRA 848
Facts: Professional Regulation Commission (PRC) issued Resolution No. 105 as part of its "Additional Instructions to Examinees to all those applying for admission to take the licensure examinations in accountancy. The resolution embodied the following pertinent provisions: "No examinee shall attend any review class, briefing, conference or the like conducted by, or shall receive any hand-out, review material, or any tip from any school, college or university, or any review center or the like or any reviewer, lecturer, instructor official or employee of any of the aforementioned or similar institutions during the three days immediately preceding every examination day including the examination day. Any examinee violating this instruction shall be subject to the sanctions. Petitioners, all reviewees preparing to take the licensure examinations in accountancy filed in their own behalf and in behalf of all others similarly situated like them, with the RTC a complaint for injunction with a prayer for the issuance of a writ of preliminary injunction against respondent PRC to restrain the latter from enforcing the abovementioned resolution and to declare the same unconstitutional. Issue: WON the Resolution is unconstitutional Held: The Resolution is null and void. The enforcement of Resolution No. 105 is not a guarantee that the alleged leakages in the licensure examinations will be eradicated or at least minimized. Making the examinees suffer by depriving them of legitimate means of review or preparation on those last three precious days-when they should be refreshing themselves with all that they have learned in the review classes and preparing their mental and psychological make-up for the examination day itself-would be like uprooting the tree to get ride of a rotten branch. What is needed to be done by the respondent is to find out the source of such leakages and stop it right there. If corrupt officials or personnel should be terminated from their loss, then so be it. Fixers or swindlers should be flushed out. Strict guidelines to be observed by examiners should be set up and if violations are committed, then licenses should be suspended or revoked. These are all within the powers of the respondent commission as provided for in Presidential Decree No. 223. But by all means the right and freedom of the examinees to avail of all legitimate means to prepare for the examinations should not be curtailed.

E. Rationale for vesting administrative agencies with quasi-judicial power C.T. Torres Enterprises, Inc. vs Hibionada 191 SCRA 268 Facts : The petitioner as agent of private respondent Pleasantville Development Corporation sold a subdivision lot on installment to private respondent Efren Diongon. The installment payments having been completed, Diongon demanded the delivery of the certificate of title to the subject land. When neither the petitioner nor Pleasantville complied, he filed a complaint against them for specific performance and damages in the Regional Trial Court of Negros Occidental. The case was set for initial hearing. It was then that C.T. Torres Enterprises filed a motion to dismiss for lack of jurisdiction, contending that the competent body to hear and decide the case was the Housing and Land Use Regulatory Board. The motion to dismiss was denied by the court contending that it had jurisdiction over the matter. Issue : WON the trial court have jurisdiction over the case. Ratio : P.D. No. 957, promulgated July 12, 1976 and otherwise known as "The Subdivision and Condominium Buyers' Protective Decree," provides that the National Housing Authority shall have exclusive authority to regulate the real estate trade and business. P.D. No. 1344, which was promulgated April 2, 1978, and empowered the National Housing Authority to issue writs of execution in the enforcement of its decisions under P.D. No. 957, specified the quasi-judicial jurisdiction of the agency as follows:
SECTION 1. In the exercise of its functions to regulate the real estate trade and business and in addition to its powers provided for in Presidential Decree No. 957, the National Housing Authority shall have exclusive jurisdiction to hear and decide cases of the following nature: A. Unsound real estate business practices; B. Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the project owner developer, dealer, broker or salesman; and C. Cases involving specific performance of contractual and statutory obligations filed by buyers of subdivision lots or condominium units against the owner, developer, dealer, broker or salesman.

This departure from the traditional allocation of governmental powers is justified by expediency, or the need of the government to respond swiftly and competently to the pressing problems of the modem world. F. Scope of quasi-judicial powers of an administrative agency GSIS vs CSC 202 SCRA 799 Facts : The Government Service Insurance System (GSIS) dismissed six (6) employees as being "notoriously undesirable," they having allegedly been found to be connected with irregularities in the canvass of supplies and materials. Five of these six dismissed employees appealed to the Merit Systems Board. The Board found the dismissals to be illegal because affected without formal charges having been filed or an opportunity given to the employees to answer, and ordered the remand of the cases to the GSIS for appropriate disciplinary proceedings. The GSIS appealed to the Civil Service Commission. By Resolution, the Commission ruled that the dismissal of all five was indeed illegal. GSIS appealed to the SC and affirmed the decision of the CSC with a modification that it eliminated the payment of back salaries until the outcome of the investigation and reinstatement of only 3 employees since the other two had died. The heirs of the deceased sought execution of the order from the CSC which was granted. GSIS opposed and came to the SC on certiorari contending that the CSC does not have any power to execute its resolution or judgment. Issue : WON the CSC had powers to execute its resolution or judgment. Ratio : The Civil Service Commission, like the Commission on Elections and the Commission on Audit, is a constitutional commission invested by the Constitution and relevant laws not only with authority to administer the civil service, but also with quasi-judicial powers. It has the authority to hear and decide administrative disciplinary cases instituted directly with it or brought to it on appeal. The Civil Service Commission promulgated Resolution No. 89-779 adopting, approving and putting into effect simplified rules of procedure on administrative disciplinary and protest cases, pursuant to the authority granted by the constitutional and statutory provisions. The provisions are analogous and entirely consistent with the duty or responsibility reposed in the Chairman by PD 807, subject to policies and resolutions adopted by the Commission. In light of all the foregoing constitutional and statutory provisions, it would appear absurd to deny to the Civil Service Commission the power or authority to enforce or order execution of its decisions, resolutions or orders which, it should


be stressed, it has been exercising through the years. It would seem quite obvious that the authority to decide cases is inutile unless accompanied by the authority to see that what has been decided is carried out. Hence, the grant to a tribunal or agency of adjudicatory power, or the authority to hear and adjudge cases, should normally and logically be deemed to include the grant of authority to enforce or execute the judgments it thus renders, unless the law otherwise provides. Death, however, has already sealed that outcome, foreclosing the initiation of disciplinary administrative proceedings, or the continuation of any then pending, against the deceased employees. Whatever may be said of the binding force of the Resolution of July 4, 1988 so far as, to all intents and purposes, it makes exoneration in the administrative proceedings a condition precedent to payment of back salaries, it cannot exact an impossible performance or decree a useless exercise. Angara vs Electoral Commission 63 Phil 139 Facts : This is an original action instituted in this court by the petitioner, Jose A. Angara, for the issuance of a writ of prohibition to restrain and prohibit the Electoral Commission, one of the respondents, from taking further cognizance of the protest filed by Pedro Ynsua, another respondent, against the election of said petitioner as member of the National Assembly for the first assembly district of the Province of Tayabas. Petitioner challenges the jurisdiction of the Electoral Commission. Issue : WON Electoral Commission acted without or in excess of its jurisdiction in assuming to take cognizance of the protest filed against the election of the herein petitioner notwithstanding the previous confirmation of such election by resolution of the National Assembly? Ratio : The creation of the Electoral Commission carried with it ex necesitate rei the power regulative in character to limit the time within which protests intrusted to its cognizance should be filed. It is a settled rule of construction that where a general power is conferred or duty enjoined, every particular power necessary for the exercise of the one or the performance of the other is also conferred (Cooley, Constitutional Limitations, eighth ed., vol. I, pp. 138, 139). In the absence of any further constitutional provision relating to the procedure to be followed in filing protests before the Electoral Commission, therefore, the incidental power to promulgate such rules necessary for the proper exercise of its exclusive powers to judge all contests relating to the election, returns and qualifications of members of the National Assembly, must be deemed by necessary implication to have been lodged also in the Electoral Commission.


Provident Tree Farms vs Batario, Jr. 231 SCRA 463 Facts : PETITIONER PROVIDENT TREE FARMS, INC. (PTFI), is a Philippine corporation engaged in industrial tree planting. It grows gubas trees in its plantations in Agusan and Mindoro which it supplies to a local match manufacturer solely for production of matches. In consonance with the state policy to encourage qualified persons to engage in industrial tree plantation, Sec. 36, par. (1), of the Revised Forestry Code 1 confers on entities like PTFI a set of incentives among which is a qualified ban against importation of wood and "wood-derivated" products. Private respondent A. J. International Corporation (AJIC) imported four (4) containers of matches from Indonesia, which the Bureau of Customs, and two (2) more containers of matches from Singapore. Upon request of PTFI, Secretary Fulgencio S. Factoran, Jr., of the Department of Natural Resources and Environment issued a certification that "there are enough available softwood supply in the Philippines for the match industry at reasonable price." PTFI then filed with the Regional Court of Manila a complaint for injunction and damages with prayer for a temporary restraining order against respondents Commissioner of Customs and AJIC to enjoin the latter from importing matches and "wood-derivative" products, and the Collector of Customs from allowing and releasing the importations. AJIC moved to dismiss the case asseverating that the enforcement of the import ban under Sec. 36, par. (1), of the Revised Forestry Code is within the exclusive realm of the Bureau of Customs, and direct recourse of petitioner to the Regional Trial Court to compel the Commissioner of Customs to enforce the ban is devoid of any legal basis. Issue : WON the RTC has jurisdiction over the case. Ruling : PTFI's correspondence with the Bureau of Customs contesting the legality of match importations may already take the nature of an administrative proceeding the pendency of which would preclude the court from interfering with it under the doctrine of primary jurisdiction. Under the sense-making and expeditious doctrine of primary jurisdiction . . . the courts cannot or will not determine a controversy involving a question which is within the jurisdiction of an administrative tribunal, where the question demands the exercise of sound administrative discretion requiring the special knowledge, experience, and services of the administrative tribunal to determine technical and intricate matters of fact, and a uniformity of ruling is essential to comply with the purposes of the regulatory statute administered.


In this era of clogged court dockets, the need for specialized administrative boards or commissions with the special knowledge, experience and capability to hear and determine promptly disputes on technical matters or essentially factual matters, subject to judicial review in case of grave abuse of discretion, has become well nigh indispensable . . . Tejada v. Homestead Property Corporation 178 SCRA 164 Facts : Private respondent Taclin V. Baez offered to sell to petitioner Enriqueto F. Tejada a 200 square meter lot owned by respondent corporation. Private respondent suggested that petitioner pay a reservation fee of P20,000.00, which would form part of the consideration in case they reach a final agreement of sale and which amount was to be returned to the petitioner should the parties fail to reach an agreement. After paying the reservation fee, the respondent corporation changed the terms of monthly amortization which resulted in the demand of the petitioner for the return of his reservation fee. Respondent refused to return the same and petitioner brought suit with the RTC for a collection of sum of money. Respondents herein filed a motion to dismiss contesting the jurisdiction of the RTC to hear the case. The same was denied and respondents appealed to the CA who decided in their favor. Petitioner argues that inasmuch as there is no perfected contract of sale between the parties, the claim for recovery of the reservation fee properly falls within the jurisdiction of the regular courts and not that of the HSRC. Issue : WON the RTC had jurisdiction over the recovery of reservation fee. Ratio : The RTC has no jurisdiction. Under Presidential Decree No. 1344, the NHA has exclusive jurisdiction to hear and decide claims involving refund and other claims filed by a subdivision lot or condominium unit buyer against the project owner, etc. There is no such qualification in said provision of law that makes a distinction between a perfected sale and one that has yet to be perfected. The word "buyer" in the law should be understood to be anyone who purchases anything for money. Under the circumstances of this case, one who offers to buy is as much a buyer as one who buys by virtue of a perfected contract of sale. Said powers have since been transferred to the HLRB. Moreover, upon the promulgation of Executive Order No. 90, it is therein provided that the HLRB has exclusive jurisdiction over claims involving refund filed against project owners, developers, and dealers, among others. When an administrative agency or body is conferred quasi-judicial functions, all controversies relating to the subject matter pertaining to its specialization are deemed to be included within the jurisdiction of said administrative agency or


body. Split jurisdiction is not favored. Since in this case the action for refund of reservation fee arose from a proposed purchase of a subdivision lot obviously the HLRB has exclusive jurisdiction over the case. Cario vs. CHR 204 SCRA 483 Ruling : Hence it is that the Commission on Human Rights, having merely the power "to investigate," cannot and should not "try and resolve on the merits" (adjudicate) the matters involved in Striking Teachers HRC Case No. 90-775, as it has announced it means to do; and it cannot do so even if there be a claim that in the administrative disciplinary proceedings against the teachers in question, initiated and conducted by the DECS, their human rights, or civil or political rights had been transgressed. More particularly, the Commission has no power to "resolve on the merits" the question of (a) whether or not the mass concerted actions engaged in by the teachers constitute a strike and are prohibited or otherwise restricted by law; (b) whether or not the act of carrying on and taking part in those actions, and the failure of the teachers to discontinue those actions and return to their classes despite the order to this effect by the Secretary of Education, constitute infractions of relevant rules and regulations warranting administrative disciplinary sanctions, or are justified by the grievances complained of by them; and (c) what where the particular acts done by each individual teacher and what sanctions, if any, may properly be imposed for said acts or omissions. These are matters undoubtedly and clearly within the original jurisdiction of the Secretary of Education, being within the scope of the disciplinary powers granted to him under the Civil Service Law, and also, within the appellate jurisdiction of the Civil Service Commission.


Classification of adjudicatory powers 2. Directing powers. Illustrated by the corrective powers of public utility commissions, powers of assessment under the revenue laws, reparations under public utility laws and awards under; 3. Enabling powers. The grant or denial of permit or authorization; 1. Dispensing powers. The authority to exempt from or relax a general prohibition, or authority to relieve from affirmative duty. The licensing power sets or assumes a standard, while the dispensing power sanctions a deviation from a standard;


2. Summary powers. To designate administrative power to apply compulsion or force against person or property to effectuate a legal purpose without a judicial warrant to authorize such action; 3. Equitable powers. An administrative tribunal having power to determine the law upon a particular state of facts has the right to and must consider and make proper application of the rules of equity. VII. The Power to Issue Subpoena Carmelo vs Ramos 6 SCRA 836 Facts : Issue : Ruling : Section 13 Book VII 1987 Admin. Code Caamic vs Galaon 237 SCRA 390 Facts : Respondent MTC judge issued a subpoena against Caamic which required her to appear before his sala under the penalty of law. Caamic was surprised for she was not aware of any case filed against her. When she appeared at the date, time and place stated in the subpoena, she was berated by the respondent and demanded 8K from her. Said amount was the amount of the life insurance policy of one Edgardo Sandagan. Said subpoena was issued upon request by Generosa Sandagan who sought the help of respondent because she could not get a share of the proceeds of the life insurance policy of her dead husband whose beneficiary was Caamic. Issue : Propriety of the subpoena issued by the respondent judge. Ruling : Respondent should have known or ought to know that under Section 1, Rule 23 of the Rules of Court, a subpoena "is a process directed to a person requiring him to attend and to testify at the hearing or the trial of an action, or at any investigation conducted under the laws of the Philippines, or for taking of his deposition." Although the subpoena he caused to be issued purports to be in a form for criminal cases pending in his court, it was not, in fact, issued in connection with a criminal case or for any other pending case in his court nor for any investigation he was competent to conduct pursuant to law or by direction of


this Court. It was designated for a specific purpose, viz., administrative conference. That purpose was, in no way connected with or related to some of his administrative duties because he knew from the beginning that it was for a confrontation with the complainant as solicited by Generosa. Sandagan for the latter to get a share in the death benefits of Edgardo Sandagan which was received by the complainant. Generosa had not filed any action in respondent's court for her claim; neither is there any case in respondent's court concerning such death benefits. What Generosa wanted was for respondent to act as mediator or conciliator to arrive at a possible compromise with the complainant, which was, obviously, non-official and absolutely a private matter. Not being then directly or remotely related to his official functions and duties, accommodating the request and using his official functions and office in connection therewith was, by any yardstick, improper. In a suit for unfair competition, it is only through the issuance of the questioned "subpoena duces tecum " that the complaining party is afforded his full rights of redress. Universal Rubber Products vs CA 130 SCRA 104 Facts : Private respondents herein sued herein petitioner for unfair competition in the lower court. During the trial and after the presentation of some of private respondents witnesses, they requested the court for a subpoena duces tecum as regards to the books of herein petitioner. Petitioner moved to quash the subpoena on the ground that it can only be regarded as a fishing bill to discover evidence against herein petitioner and that such is not applicable in a case for unfair competition. The trial court denied the same. Issue : WON the issuance of a subpoena duces tecum is proper in a case for unfair competition. Ratio : A case for unfair competition is actually a case for injunction and damages. As a general rule, on obtaining an injunction for infringement of a trademark, complainant is entitled to an accounting and recovery of defendant's profits on the goods sold under that mark, as incident to, and a part of, his property right, and this rule applies in cases of unfair competition. In such case, the infringer or unfair trader is required in equity to account for and yield up his gains on a principle analogous to that which charges as trustee with the profits acquired by the wrongful use of the property of the cestui que trust, and defendant's profits are regarded as an equitable measure of the compensation plaintiff should receive for the past harm suffered by him.


in order to entitle a parry to the issuance of a "subpoena duces tecum, " it must appear. by clear and unequivocal proof, that the book or document sought to be produced contains evidence relevant and material to the issue before the court, and that the precise book, paper or document containing such evidence has been so designated or described that it may be identified. A "subpoena duces tecum" once issued by the court may be quashed upon motion if the issuance therof is unreasonable and oppressive, or the relevancy of the books. documents or things does not appear, or if the persons in whose behalf the subpoena is issued fails to advance the reasonable cost of production thereof. In the instant case in determining whether the books subject to the subpoena duces tecum are relevant and reasonable in relation to the complaint of private respondent for unfair competition. Masangcay vs COMELEC 6 SCRA 27 Facts : Masangcay was the provincial treasurer of Aklan who was charged with several others for CONTEMPT by the COMELEC when it opened 3 boxes without the presence of the persons and/or parties indicated in its Resolution. After appearing and showing cause why they should not be punished for contempt, the COMELEC sentenced Masangcay for imprisonment and imposing a fine. Masangcay filed a petition for review with the SC. Issue : WON the COMELEC may punish Masangcay for contempt for his acts. Ruling : When the Commission exercises a ministerial function it cannot exercise the power to punish for contempt because such power is inherently judicial in nature. In proceeding on this matter, it only discharged a ministerial duty; it did not exercise any judicial function. Such being the case, it could not exercise the power to punish for contempt as postulated in the law, for such power is inherently judicial in nature. The Commission on Elections has not only the duty to enforce and administer all laws relative to the conduct of elections, but also the power to try, hear and decide any controversy that may be submitted to it in connection with the elections. In this sense, we said, the Commission, although it cannot be classified as a court of justice within the meaning of the Constitution (Section 30, Article VIII), for it is merely an administrative body, may however exercise quasijudicial functions insofar as controversies that by express provision of law come under its jurisdiction.


The power to punish for contempt is inherent in all courts; its existence is essential to the preservation of order in judicial proceedings, and to the enforcement of judgments, orders and mandates of courts, and, consequently, in the, administration of justice. The exercise of this power has always been regarded as a necessary incident and attribute of courts. Its exercise by administrative bodies has been invariably limited to making effective the power to elicit testimony. And the exercise of that power by an administrative body in furtherance of its administrative function has been held invalid. VIII. The Power To Punish For Contempt People v. Mendoza 92 Phil 570 Camelo v. Ramos 116 Phil 1152 IX. Power to impose penalties Scotys Department Store v. Micaller 99 Phil 762 Facts: Nena Micaller was employed as a salesgirl in the Scoty's Department Store situated at 615 Escolta, Manila. This store was owned and operated by Yu Ki Lam, Richard Yang, Yu Si Kiao and Helen Yang. Pursuant to section 5(b) of the Industrial Peace Act, Nena Micaller filed charges of unfair labor practice against her above employers alleging that she was dismissed by them because of her membership in the National Labor Union and that, prior to her separation, said employers had been questioning their employees regarding their membership in said union and had interfered with their right to organize under the law. The employers denied the charge. They claimed that the complainant was dismissed from the service because of her misconduct and serious disrespect to the management and her co employees so much so that several criminal charges were filed against her with the city fiscal of Manila who, after investigation, filed the corresponding informations against her and the same are now pending trial in court. The Court of industrial relation ruled in favor of Nina Micaller and impose fine against the petitioner. Issue: WON the Court of Industrial Relations has jurisdiction to impose the penalties prescribed in section 25 of Republic Act No. 875.


Ruling: This is against the due process guaranteed by our Constitution. It may be contended that this gap may be subserved by requiring the Court of Industrial Relations to observe strictly the rules applicable to criminal cases to meet the requirements of the Constitution, but this would be tantamount to amending the law which is not within the province of the judicial branch of our Government. In conclusion, our considered opinion is that the power to impose the penalties provided for in section 25 of Republic Act No. 875 is lodged in ordinary courts, and not in the Court of Industrial Relations, notwithstanding the definition of the word "Court" contained in section 2 (a) of said Act. Hence, the decision of the industrial court in so far as it imposes a fine of P100 upon petitioners is illegal and should be nullified. The procedure laid down by law to be observed by the Court of Industrial Relations in dealing with unfair labor practice cases negates those constitutional guarantees to the accused. And this is so because, among other things, the law provides that "the rules of evidence prevailing in courts of law or equity shall not be controlling and it is the spirit and intention of this Act that the Court (of Industrial Relations) and its members and Hearing Examiners shall use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law, or procedure." It is likewise enjoined that "the Court shall not be bound solely by the evidence presented during the hearing but may avail itself of all other means such as (but not limited to) ocular inspections and questioning of well-informed persons which results must be made a part of the record". All-this means that an accused may be tried without the right "to meet the witnesses face to face" and may be convicted merely on preponderance of evidence and not beyond reasonable doubt. CAB v. PAL 63 SCRA 524 X. Power in deportation and citizenship cases Lao Gi v. Court of Appeals 180 SCRA 756 ADMINISTRATIVE PROCEEDINGS I. Jurisdiction A. Definition People vs Mariano 71 SCRA 600


Facts: The Accused was convicted of the crime of abused of chastity. He filed an appealed contending that he married the victim therefore his criminal liability should be extinguished. The Attorney-General entered an opposition to said petition wherein, after discussing the scope of article 448 of the Penal Code and Act No. 1773 of the Philippine Legislature amending said article, he concluded that the marriage of the accused with the offended party cannot extinguish his liability as perpetrator of the crime of abuse against chastity. Issue: Whether or not section 2 of Act No. 1773 includes the crime of abuse against chastity among those cases in which criminal liability is extinguished by the marriage of the accused with the offended party. Ruling: The intention of our Legislature in enacting said Act No. 1773 was that the marriage of the accused or convict with the offended party should extinguish the criminal liability in the cases of seduction, abduction and rape and those involving offenses included in said crimes, such as frustrated or attempted seduction, abduction or rape. This is clear and logical. If the liability for a crime is extinguished in the graver cases, it must be extinguished, and for a stronger reason, in the lesser crimes. Now then, if the crime of abuse against chastity is not denominated rape, it is only for the lack of the intention to lie, both crimes being identical in every other respect, though of different degrees of gravity. We therefore conclude that the crime of abuse against chastity is included in the crime of rape mentioned in section 2 of Act No. 1773 and, consequently, the marriage of the accused with the offended party in the present case has extinguished his criminal liability. B. Extent of jurisdiction of administrative agencies performing quasijudicial acts Chin vs LBP 201 SCRA 190 Taule vs Santos 200 SCRA 512 Facts: The Federation of Associations of Barangay Councils (FABC) of Catanduanes decided to hold the election of katipunan despite the absence of five (5) of its members, the Provincial Treasurer and the Provincial Election Supervisor walked out. The President elect - Ruperto Taule Vice-President- Allan Aquino SecretaryVicente Avila Treasurer- Fidel Jacob Auditor- Leo Sales. Respondent Leandro L Verceles, Governor of Catanduanes sent a letter to respondent Luis T. Santos, the Secretary of Local Government,** protesting the election of the officers of the FABC and seeking its mullification in view of several flagrant irregularities in the manner it was conducted. Respondent


Secretary issued a resolution nullifying the election of the officers of the FABC in Catanduanes held on June 18, 1989 and ordering a new one to be conducted as early as possible to be presided by the Regional Director of Region V of the Department of Local Government. Petitioner filed a motion for reconsideration of the resolution but it was denied by respondent Secretary. In the petition for certiorari before Us, petitioner seeks the reversal of the resolutions of respondent for being null and void. Issue: Whether or not the respondent Secretary has jurisdiction to entertain an election protest involving the election of the officers of the Federation of Association of Barangay Councils, Assuming that the respondent Secretary has jurisdiction over the election protest, whether or not he committed grave abuse of discretion amounting to lack of jurisdiction in nullifying the election? Ruling: The Secretary of Local Government is not vested with jurisdiction to entertain any protest involving the election of officers of the FABC. There is no question that he is vested with the power to promulgate rules and regulations as set forth in Section 222 of the Local Government Code. "(3) Promulgate rules and regulations necessary to carry out department objectives, policies, functions, plans, programs and projects;" It is a well-settled principle of administrative law that unless expressly empowered, administrative agencies are bereft of judicial powers. The jurisdiction of administrative authorities is dependent entirely upon the provisions of the statutes reposing power in them; they cannot confer it upon themselves. Such jurisdiction is essential to give validity to their determinations." There is neither a statutory nor constitutional provision expressly or even by necessary implication conferring upon the Secretary of Local Government the power to assume jurisdiction over an election protect involving officers of the katipunan ng mga barangay. Construing the constitutional limitation on the power of general supervision of the President over local governments, We hold that respondent Secretary has no authority to pass upon the validity or regularity of the election of the officers of the katipunan. To allow respondent Secretary to do so will give him more power than the law or the Constitution grants. It will in effect give him control over local government officials for it will permit him to interfere in a purely democratic and nonpartisan activity aimed at strengthening the barangay as the basic component of local governments so that the ultimate goal of fullest autonomy may be achieved.



Procedure to be followed Sections 1 and 2.1 Book VII, 1987 Administrative Code A. Source of authority to promulgate rules of procedure Section 5.5, Article VIII, Constitution Angara vs Electoral Commission 63 Phil 139

Facts: That in the elections of September 17, 1935, the petitioner, Jose A. Angara won. The provincial board of canvassers, proclaimed the petitioner as memberelect of the National Assembly for the said district, for having received the most number of votes, the petitioner took his oath of office. Respondent Pedro Ynsua filed before the Electoral Commission a "Motion of Protest" against the election of the herein petitioner, Jose A. Angara, and praying, among other things, that said respondent be declared elected member of the National Assembly for the first district of Tayabas, or that the election of said position be nullified. Issue: WON the said Electoral Commission acted without or in excess of its jurisdiction in assuming to take cognizance of the protest filed against the election of the herein petitioner notwithstanding the previous confirmation of such election by resolution of the National Assembly? Ruling: The grant of power to the Electoral Commission to judge all contests relating to the election, returns and qualifications of members of the National Assembly, is intended to be as complete and unimpaired as if it had remained originally in the legislature. The express lodging of that power in the Electoral Commission is an implied denial of the exercise of that power by the National Assembly. And this is as effective a restriction upon the legislative power as an express prohibition in the Constitution. If we concede the power claimed in behalf of the National Assembly that said body may regulate the proceedings of the Electoral Commission and cut off the power of the commission to lay down the period within which protests should be filed, the grant of power to the commission would be ineffective. The creation of the Electoral Commission carried with it ex necesitate rei the power regulative in character to limit the time within which protests intrusted to its cognizance should be filed. It is a settled rule of construction that where a general power is conferred or duty enjoined, every particular power necessary for the exercise of the one or the performance of the other is also included. The incidental power to promulgate such rules necessary for the proper exercise of its exclusive power to judge all contests relating to the election, returns and


qualifications of members of the National Assembly, must be deemed by necessary implication to have been lodged also in the Electoral Commission. B. Limitations on the power to promulgate rules of procedure First Lepanto Ceramics vs CA 231 SCRA 30 lourdes C. Technical rules not applicable Kanlaon Construction Enterprises vs NLRC 279 SCRA 337 Facts: This is a labor case involving Kanlaon for illegal termination of employment of publics respondents. The arbitrations decision is appealed to the NLRC. Public respondents in their appeal questioned the validity of the NLRCs decision on the ground that the NLRC erroneously, patently and unreasonably interpreted the principle that the NLRC and its Arbitration Branch are not strictly bound by the rules of evidence. In brief, it was alleged that the the decision is void for the following reasons: (1) there was no valid service of summons; (2) Engineers Estacio and Dulatre and Atty. Abundiente had no authority to appear and represent petitioner at the hearings before the arbiters and on appeal to respondent Commission; (3) the decisions of the arbiters and respondent Commission are based on unsubstantiated and self-serving evidence and were rendered in violation of petitioner's right to due process. Issue: WON publics respondents claim is tenable. Held: The labor arbiters and the NLRC must not, at the expense of due process, be the first to arbitrarily disregard specific provisions of the Rules which are precisely intended to assist the parties in obtaining the just, expeditious and inexpensive settlement of labor disputes. The decision of the National Labor Relations Commission, Fifth Division, is annulled and set aside and the case is remanded to the Regional Arbitration Branch, Iligan City for further proceedings. Ang Tibay vs CIR 69 Phil 635 Ruling: The Court of Industrial Relations is not narrowly constrained by technical rules of procedure, and the Act requires it to "act according to justice and equity and substantial merits of the case, without regard to technicalities or legal forms and shall not be bound by any technical rules of legal evidence but may inform its mind in such manner as it may deem just and equitable." (Section 20, Commonwealth Act No. 103.) It shall not be restricted to the specific relief claimed or demands made by the parties to the industrial or agricultural dispute, but may include in the award, order or decision any matter or determination which may be deemed necessary or expedient for the purpose of settling the dispute or of preventing further industrial or agricultural disputes. (Section 13, ibid.) And in the light of this legislative policy, appeals to this Court have been especially regulated by the rules recently promulgated by this Court to carry into effect the avowed legislative purpose. The fact, however, that the Court of Industrial Relations 23

may be said to be free from the rigidity of certain procedural requirements does not mean that it can, in justiciable cases coming before it, entirely ignore or disregard the fundamental and essential requirements of due process in trials and investigations of an administrative character. Police Commission vs Lood 127 SCRA 757 Facts: Petitioner Police Commission seeks the setting aside of the decision of the defunct Court of First Instance (respondent court) of Rizal, Branch VI, which declared null and void its decision in Administrative Case No. 48 dismissing private respondent Simplicio C. Ibea and instead ordered then Municipal Mayor Braulio Sto. Domingo of San Juan, Rizal to reinstate said respondent to his former position as policeman of the same municipality with back salaries from the date of his suspension up to the date of his actual reinstatement. Petitioner contends that the lower court erred in holding that respondent Simplicio C. Ibea was deprived of due process of law because the Police Commission decided Administrative Case No. 48 even without stenographic notes taken of the proceedings of the case. Ruling: Respondent court's ruling against petitioner's decision as falling short of the legal requirements of due process, because it decided the subject administrative case without stenographic notes (which were not taken by the Board of Investigators) of the proceedings of the case, was in error. Rep. Act No. 4864 does not provide that the Board of Investigators shall be a "board of record," and as such it does not provide for office personnel such as clerks and stenographers who may be employed to take note of the proceedings of the board. The proceeding provided for is merely administrative and summary in character, in line with the principle that "administrative rules of procedure should be construed liberally in order to promote their object and to assist the parties in obtaining just, speedy and inexpensive determination of their respective claims and defenses." The formalities usually attendant in court hearings need not be present in an administrative investigation, provided that the parties are heard and gven the opportunity to adduce their respective evidence. D. Justiciable controversy and forum shopping SEC vs CA 246 SCRA 738 Facts: The petition before this Court relates to the exercise by the SEC of its powers in a case involving a stockbroker (CUALOPING) and a stock transfer agency (FIDELITY). The Commission has brought the case to this Court in the instant petition for review on certiorari, contending that the appellate court erred in setting aside the decision of the SEC which had (a) ordered the replacement of the certificates of stock of Philex and (b) imposed fines on both FIDELITY and CUALOPING.


Held: The Securities and Exchange Commission ("SEC") has both regulatory and adjudicative functions. Under its regulatory responsibilities, the SEC may pass upon applications for, or may suspend or revoke (after due notice and hearing), certificates of registration of corporations, partnerships and associations (excluding cooperatives, homeowners' associations, and labor unions); compel legal and regulatory compliances; conduct inspections; and impose fines or other penalties for violations of the Revised Securities Act, as well as implementing rules and directives of the SEC, such as may be warranted. The SEC decision which orders the two stock transfer agencies to "jointly replace the subject shares and for FIDELITY to cause the transfer thereof in the names of the buyers" clearly calls for an exercise of SEC's adjudicative jurisdiction. The stockholders who have been deprived of their certificates of stock or the persons to whom the forged certificates have ultimately been transferred by the supposed indorsee thereof are yet to initiate, if minded, an appropriate adversarial action. A justiciable controversy such as can occasion an exercise of SEC's exclusive jurisdiction would require an assertion of a right by a proper party against another who, in turn, contests it. The proper parties that can bring the controversy and can cause an exercise by the SEC of its original and exclusive jurisdiction would be all or any of those who are adversely affected by the transfer of the pilfered certificates of stock. Any peremptory judgment by the SEC, without such proceedings having initiated, would be precipitat. The question on the legal propriety of the imposition by the SEC of a P50,000 fine on each of FIDELITY and CUALOPING, is an entirely different matter. This time, it is the regulatory power of the SEC which is involved. When, on appeal to the Court of Appeals, the latter set aside the fines imposed by they the SEC, the latter, in its instant petition, can no longer be deemed just a nominal party but a real party in interest sufficient to pursuant appeals to this Court. Section 2.5 Book VII 1987 Admin Code Santiago, Jr. vs Bautista 32 SCRA 188 Villanueva vs Adre 172 SCRA 876 Chemphil Export & Import Corp. vs CA 251 SCRA 257 First Phil. Intl Bank vs CA 252 SCRA 259 R. Transport Corp. vs Laguesma 227 SCRA 826 Galongco vs CA 283 SCRA 493 E. Institution of proceedings; acquisition of jurisdiction Section 5, Rule 7 1997 Rules of Civil Procedure Santos vs NLRC 254 SCRA 675 Matanguihand vs Tengo, 272 SCRA 704 F. Pre-trial conference; default Section 10 Book VII 1987 Admin. Code Auyong vs CTA 59 SCRA 110 G. Hearing Secretary of Justice vs Lantion 322 SCRA 160 Section 11.1 Book VII 1987 Admin. Code


Medenilla vs CSC 194 SCRA 278 Simpao vs CSC 191 SCRA 396 Alejandro vs CA 191 SCRA 700 H. Evidence Section 12.3 Book VII 1987 Admin Code State Prosecutor vs Muro 236 SCRA 505 1. Proof beyond reasonable doubt People vs Bacalzo 195 SCRA 557 2. Clear and convincing evidence Blacks Law Dictionary 5th ed. P. 227 3. Preponderance of evidence New Testament Church of God vs CA 246 SCRA 266 4. Substantial evidence Velasquez vs Nery 211 SCRA 28 Malonzo ns COMELEC 269 SCRA 380 Decision Section 2.8, 14 Book VII 1987 Admin Code Marcelino vs Cruz 121 SCRA 51 Romualdez-Marcos vs COMELEC 248 SCRA 300 1. Form of decision Mangca vs COMELEC 112 SCRA 273 Malinao vs Reyes 255 SCRA 616 Sections 2.13 and 2.12 Book VII 1987 Admin Code 2. Publication of decisions Section 16.1.2 Book VII 1987 Admin Code 3. Finality, promulgation and notice of decision Section 15 Book VII 1987 Admin Code Robert Dollar Company vs Tuvera 123 SCRA 354 Lindo vs COMELEC 194 SCRA 25 Jamil vs COMELEC 283 SCRA 349 Section 14 Book VII 1987 Admin Code Zoleta vs Drilon 166 SCRA 548 4. Collegiate decision, requirement to be valid Mison vs COA 187 SCRA 445 Aquino-Sarmiento vs Morato 203 SCRA 515 5. Finality of decisions Section 15 Chapter III Book VII Admin Code of 1987 Administrative Order No. 18 Section 7 Uy vs COA 328 SCRA 607 Camarines Norte Electric Cooperative vs Torres 286 SCRA 666 6. Application of the doctrine of res judicata Republic vs Neri 213 SCRA 812 Brillantes v Castro 99 Phil 497 Ipekdjian Merchandising vs CTA, L-15430, 30 Sept. 1963



Teodoro vs Carague 206 SCRA 429 J. Administrative appeal in contested cases Section 19, 20, 21, 22 Book VII 1987 Admin Code Mendez vs CSC 204 SCRA 965 PCIB vs CA 229 SCRA 560 Diamonon vs DOLE 327 SCRA 283 De Leon vs Heirs of Gregorio Reyes 155 SCRA 584 Vda de Pineda vs Pena 187 SCRA 22 Reyes vs Zamora 90 SCRA 92 Section 23 Book VII 1987 Admin Code Zambales Chromite Mining Co. v. Court of Appeals 94 SCRA 261 Ysmael v. Dep Exec Sec 190 SCRA 673 K. Execution Divinagracia vs CFI 3 SCRA 775 GSIS vs CSC 202 SCRA 799 Vital-Gozon vs CA 212 SCRA 235 II. Due process of law in administrative adjudication A. Substantive and procedural due process, defined Santiago vs Alikpala 25 SCRA 356 Secretary of Justice vs Lantion 322 SCRA 160 Albert vs CFI of Manila 23 SCRA 948 B. Cardinal primary requirements of due process Ang Tibay vs CIR 69 Phil 635 Fabella vs CA 282 SCRA 256 Air Manila vs Balatbat 38 SCRA 489 C. Necessity for notice and hearing Philippine Movie Pictures Wokers Association vs Premiere Productions, Inc., G.R. No. L-5621, 25 March 1953 Mabuhay Textile Mills vs Ongpin 141 SCRA 437 Go vs NAPOLCOM 271 SCRA 447 D. Cold neutrality of a judge Zamboanga Chromite Mining Co. vs CA 94 SCRA 261 E. Prior notice and hearing, essential elements of procedural due process Villa vs Lazaro 189 SCRA 34 RCA Communications vs PLDT 110 Phil 420 Section 11 Book VII 1987 Admin Code Bolastig vs Sandiganbayan 235 SCRA 103 F. Notice and hearing, when dispensed with 1. Where there is an urgent need for immediate action, like the summary abatement of a nuisance per se, the preventive suspension of public servant facing administrative charges; Central Bank vs CA 220 SCRA 536 Estate of Gregoria Francisco vs CA 199 SCRA 595




Sitchon vs Aquino 98 Phil 458 2. Where there is tentativeness of administrative action; where the respondent is not precluded from enjoying the right to notice and hearing at a later time without prejudice to the person affected, such as the summary distraint and levy of the property of a delinquent taxpayer and the replacement of a temporary appointee; Lastimosa vs Vasquez 243 SCRA 497 3. Where the twin rights have previously been offered but the right to exercise them had not been claimed. Asprec vs Itchon 16 SCRA 921 Banco Filipino vs Central Bank 204 SCRA 767 G. Notice and hearing in rate-fixing Vigan Electric Light vs PSC 10 SCRA 46 H. Motion for reconsideration as a cure Medenilla vs CSC 194 SCRA 278 i. Right to counsel, not a due process requirement Lumiqued vs Exevea 282 SCRA 125 Doctrine of Primary Jurisdiction A. Definition and objective Industrial Enterprises vs CA, 184 SCRA 426 Smart Communications vs NTC G.R. No. 151908 12 August 2003 B. Distinguished from the doctrine of exhaustion of administrative remedies Felizardo vs CA 233 SCRA 220 C. Effect of doctrine Villaflor vs CA 280 SCRA 327 Machete vs CA 250 SCRA 176 Director of Lands vs CA 194 SCRA 224 Provident Tree Farms vs Batario 231 SCRA 463 Philippine Veterans Bank vs CA 322 SCRA 139 D. When doctrine does not apply Lagua vs Cusi 160 SCRA 260 Doctrine of exhaustion of administrative remedies A. Definition and purpose Rosales vs CA 165 SCRA 344 Gonzales vs Secretary of Education 5 SCRA 657 Carale vs Abarintos 269 SCRA 132 B. Effect of failure to exhaust remedies De los Santos vs Limbaga 4 SCRA 224 Republic vs Sandiganbayan 255 SCRA 438 Factora, Jr. vs CA 320 SCRA 530 C. When applied Ang Tuan Kai vs Import Control Commission L-4427, 21 April 1952 D. Exceptions to the doctrine 28

Sunville Timber Products vs Abad 206 SCRA 482 Gonzales vs Hechanova, 60 OG 802 Paat vs CA 266 SCRA 167 Corpus vs Cuaderno L-17860 30 March 1962 Smart Communications vs NTC G.R. No. 151908 12 August 2003 Marinduque Iron Mines v. Sec. of Public Works 8 SCRA 179 Bueno vs Patanao 9 SCRA 794 Continental Marble Corp. vs NLRC 161 SCRA 151 Kilusang Bayan vs Dominguez 205 SCRA 92 Almine vs CA 177 SCRA 796 Tapales vs President of UP 7 SCRA 553 Quintos v. National Stud Farm 54 SCRA 210 Soto v. Jareno 144 SCRA 116 Sunga v. NLRC 173 SCRA 338 Sabello v. DECS 100 SCRA 623 Montes v. Civil Service Board of Appeals 101 Phil 490