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Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 113811 October 7, 1994


ISHMAEL HIMAGAN, petitioner,
vs.
PEOPLE OF THE PHILIPPINES and HON. JUDGE HILARIO MAPAYO, RTC, Br. 11, Davao
City, respondents.
Victorio S. Advincula for petitioner.

KAPUNAN, J.:
Petitioner, a policeman assigned with the medical company of the Philippine National Police Regional
Headquarters at Camp Catitigan, Davao City, was implicated in the killing of Benjamin Machitar, Jr. and the
attempted murder of Bernabe Machitar. After the informations for murder 1 and attempted murder 2 were filed
with the Regional Trial Court, Branch 11, Davao City, on September 16, 1992, the trial court issued an Order
suspending petitioner until the termination of the case on the basis of Section 47, R.A. 6975, otherwise known
as Department of Interior and Local Government Act of 1990, which provides:
Sec. 47. Preventive Suspension Pending Criminal Case. Upon the filing of a complaint
or information sufficient in form and substance against a member of the PNP for grave
felonies where the penalty imposed by law is six (6) years and one (1) day or more, the
court shall immediately suspend the accused from office until the case is terminated. Such
case shall be subject to continuous trial and shall be terminated within ninety (90) days
from arraignment of the accused (Emphasis ours).
On October 11, 1993, petitioner filed a motion to lift the order for his suspension, 3 relying on Section 42 of
P.D. 807 of the Civil Service Decree, that his suspension should be limited to ninety (90) days and, also, on our
ruling in Deloso v. Sandiganbayan, 4 and Layno v. Sandiganbayan. 5 In his order dated December 14,
1993 6 respondent judge denied the motion pointing out that under Section 47 of R.A. 6975, the accused shall be
suspended from office until his case is terminated. The motion for reconsideration of the order of denial was,
likewise, denied. 7 Hence, the petition for certiorari andmandamus to set aside the orders of respondent Judge
and to command him to lift petitioner's preventive suspension.
We find the petition devoid of merit.
There is no question that the case of petitioner who is charged with murder and attempted murder under
the Revised Penal Code falls squarely under Sec. 47 of RA 6975 which specifically applies to members of
the PNP. In dispute however, is whether the provision limits the period of suspension to 90 days,
considering that while the first sentence of Sec. 47 provides that the accused who is charged with grave

felonies where the penalty imposed is six (6) years and one (1) day shall be suspended from office "until
the case is terminated", the second sentence of the same section mandates that the case, which shall be
subject to continuous trial, shall be terminated within 90 days from the arraignment of the accused.
Petitioner posits that as a member of the Philippine National Police, under Sec. 91 of RA 6975 which
reads:
Sec. 91. The Civil Service Law and its implementing rules and regulations shall apply to all
personnel of the Department.
he is covered by the Civil Service Law, particularly Sec. 42 of PD 807 of the Civil Service Decree, which
limits the maximum period of suspension to ninety (90) days, thus:
Sec. 42. Lifting of Preventive Suspension Pending Administrative Investigation. When
the administrative case against the officer or employee under preventive suspension is not
finally decided by the disciplining authority within the period of ninety (90) days after the
date of suspension of the respondent who is not a presidential appointee, the respondent
shall be automatically reinstated in the service; Provided, That when the delay in the
disposition of the case is due to the fault, negligence or petition of the respondent, the
period of delay shall not be counted in computing the period of suspension herein provided.
He claims that an imposition of preventive suspension of over 90 days is contrary to the Civil Service Law
and would be a violation of his constitutional right to equal protection of laws. He further asserts that the
requirements in
Sec. 47 of R.A. 6975 that "the court shall immediately suspend the accused from office until the case is
terminated" and the succeeding sentence, "Such case shall be subject to continuous trial and shall be
terminated within ninety (90) days from arraignment of the accused" are both substantive and should be
taken together to mean that if the case is not terminated within 90 days, the period of preventive
suspension must be lifted because of the command that the trial must be terminated within ninety (90)
days from arraignment.
We disagree.
First. The language of the first sentence of Sec. 47 of R.A. 6975 is clear, plain and free from ambiguity. It
gives no other meaning than that the suspension from office of the member of the PNP charged with grave
offense where the penalty is six years and one day or more shall last until the termination of the case. The
suspension cannot be lifted before the termination of the case. The second sentence of the same Section
providing that the trial must be terminated within ninety (90) days from arraignment does not qualify or limit
the first sentence. The two can stand independently of each other. The first refers to the period of
suspension. The second deals with the time frame within which the trial should be finished.
Suppose the trial is not terminated within ninety days from arraignment, should the suspension of accused
be lifted? The answer is certainly no. While the law uses the mandatory word "shall" before the phrase "be
terminated within ninety (90) days", there is nothing in R.A. 6975 that suggests that the preventive
suspension of the accused will be lifted if the trial is not terminated within that period. Nonetheless, the
Judge who fails to decide the case within the period without justifiable reason may be subject to
administrative sanctions and, in appropriate cases where the facts so warrant, to criminal 8 or civil liability. 9 If
the trial is unreasonably delayed without fault of the accused such that he is deprived of his right to a speedy
trial, he is not without a remedy. He may ask for the dismissal of the case. Should the court refuse to dismiss the
case, the accused can compel its dismissal by certiorari, prohibition ormandamus, or secure his liberty
by habeas corpus. 10

Second. Petitioner misapplies Sec. 42 of PD 807. A meticulous reading of the section clearly shows that it
refers to the lifting of preventive suspension in pending administrative investigation, not in criminal cases,
as here. What is more, Section 42 expressly limits the period of preventive suspension to ninety (90) days.
Sec. 91 of R.A. 6975 which states that "The Civil Service Law and its implementing rules shall apply to all
personnel of the Department" simply means that the provisions of the Civil Service Law and its
implementing rules and regulations are applicable to members of the Philippine National Police insofar as
the provisions, rules and regulations are not inconsistent with
R.A. 6975. Certainly, Section 42 of the Civil Service Decree which limits the preventive suspension to
ninety (90) days cannot apply to members of the PNP because Sec. 47 of R.A. 6995 provides differently,
that is, the suspension where the penalty imposed by law exceeds six (6) years shall continue until the
case is terminated.
Third. Petitioner's reliance on Layno and Deloso is misplaced. These cases all stemmed from charges in
violation of R.A. 3019 (1060), otherwise known as the Anti-Graft and Corrupt Practices Act which, unlike
R.A. 6975, is silent on the duration of the preventive suspension. Sec. 13 of R.A. 3019 reads as follows:
Suspension and loss of benefits. Any public officer against whom any criminal
prosecution under a valid information under this Act or under the provisions of the Revised
Penal Code on bribery is pending in court, shall be suspended from office. Should he be
convicted by final judgment, he shall lose all retirement or gratuity benefits under any law,
but if he is acquitted, he shall be entitled to reinstatement and to the salaries and benefits
which he failed to receive during suspension, unless in the meantime administrative
proceedings have been filed against him.
In the case of Layno, the duly elected mayor of Lianga, Surigao del Sur, was preventively suspended after
an information was filed against him for offenses under R.A. 3019 (1060), the Anti-Graft Corrupt Practices
Act. He had been suspended for four (4) months at the time he filed a motion to lift his preventive
suspension. We held that his indefinite preventive suspension violated the "equal protection clause" and
shortened his term of office. Thus:
2. Petitioner is a duly elected municipal mayor of Lianga, Surigao del Sur. His term of office
does not expire until 1986. Were it not for this information and the suspension decreed by
the Sandiganbayan according to the Anti-Graft and Corrupt Practices Act, he would have
been all this while in the full discharge of his functions as such municipal mayor. He was
elected precisely to do so. As of October 26, 1983, he has been unable to. It is a basic
assumption of the electoral process implicit in the right of suffrage that the people are
entitled to the services of elective officials of their choice. For misfeasance or malfeasance,
any of them could, of course, be proceeded against administratively or, as in this instance,
criminally. In either case, his culpability must be established. Moreover, if there be a
criminal action, he is entitled to the constitutional presumption of innocence. A preventive
suspension may be justified. Its continuance, however, for an unreasonable length of time
raises a due process question. For even if thereafter he were acquitted, in the meanwhile
his right to hold office had been nullified. Clearly, there would be in such a case an injustice
suffered by him. Nor is he the only victim. There is injustice inflicted likewise on the people
of Lianga. They were deprived of the services of the man they had elected to serve as
mayor. In that sense, to paraphrase Justice Cardozo, the protracted continuance of this
preventive suspension had outrun the bounds of reason and resulted in sheer oppression.
A denial of due process is thus quite manifest. It is to avoid such an unconstitutional
application that the order of suspension should be lifted.
3. Nor is it solely the denial of procedural due process that is apparent. There is likewise an
equal protection question. If the case against petitioner Layno were administrative in

character the Local Government Code would be applicable. It is therein clearly provided
that while preventive suspension is allowable for the causes therein enumerated, there is
this emphatic limitation on the duration thereof: "In all cases, preventive suspension shall
not extend beyond sixty days after the start of said suspension." It may be recalled that the
principle against indefinite suspension applies equally to national government officials. So it
was held in the leading case of Garcia v. Hon. Executive Secretary. According to the
opinion of Justice Barrera: "To adopt the theory of respondents that an officer appointed by
the President, facing administrative charges, can be preventively suspended indefinitely,
would be to countenance a situation where the preventive suspension can, in effect, be the
penalty itself without a finding of guilt after due hearing, contrary to the express mandate of
the Constitution and the Civil Service law." Further: "In the guise of a preventive
suspension, his term of office could be shortened and he could in effect, be removed
without a finding of a cause duly established after due hearing, in violation of the
Constitution. Clearly then, the policy of the law mandated by the Constitution frowns at a
suspension of indefinite duration. In this particular case, the mere fact that petitioner is
facing a charge under the Anti-Graft and Corrupt Practices Act does not justify a different
rule of law. To do so would be to negate the safeguard of the equal protection guarantee. 11
The case of Deloso, likewise, involved another elective official who
was preventively suspended as provincial governor, also under RA 3019 the Anti-Graft Law. This Court,
faced with similar factual circumstances as in Layno, applied the ruling in the latter case "in relation to the
principles of due process and equal protection."
It is readily apparent that Section 13 of R.A. 3019 upon which the preventive suspension of the accused
in Laynoand Deloso was based is silent with respect to the duration of the preventive suspension, such
that the suspension of the accused therein for a prolonged and unreasonable length of time raised a due
process question. Not so in the instant case. Petitioner is charged with murder under the Revised Penal
Code and it is undisputed that he falls squarely under Sec. 47 of R.A. 6975 which categorically states that
his suspension shall last until the case is terminated. The succeeding sentence of the same section
requires the case to be subjected to continuous trial which shall be terminated within ninety (90) days from
arraignment of the accused. As previously emphasized, nowhere in the law does it say that after the lapse
of the 90-day period for trial, the preventive suspension should be lifted. The law is clear, the ninety (90)
days duration applies to the trial of the case not to the suspension. Nothing else should be read into the
law. When the words and phrases of the statute are clear and unequivocal, their meaning determined from
the language employed and the statute must be taken to mean exactly what it says. 12
Fourth. From the deliberations of the Bicameral Conference Committee on National Defense relative to the
bill that became R.A. 6975, the meaning of Section 47 of R.A. 6975 insofar as the period of suspension is
concerned becomes all the more clear. We quote:
So other than that in that particular section, ano ba itong "Jurisdiction in
Criminal Cases?" What is this all about?
REP. ZAMORA. In case they are charged with crimes.
THE CHAIRMAN (SEN. MACEDA). Ah, the previous one is administrative,
no. Now, if it is charged with a crime, regular courts.
SEN. GONZALES. Ano, the courts mismo ang magsasabing . . .
THE CHAIRMAN (SEN. MACEDA). No, the jurisdiction.

REP. ZAMORA. The jurisdiction if there is robbery.


THE CHAIRMAN (SEN. MACEDA). Okay. "Preventive Suspension Pending
Criminal Case. Upon the filing of a complaint or informations sufficient in
form and substance against a member of the PNP for grave felonies where
the penalty imposed by law is six years and one day or more, the court shall
immediately suspend the accused from the office until the case is
terminated."
REP. ALBANO. Where are we now Mr. Chairman.
THE CHAIRMAN (SEN. MACEDA). Grave felonies ito e. Six years and one
day or more.
SEN. SAGUISAG. Kung five years and litigation ng Supreme Court, ganoon
ba and . . .?
THE CHAIRMAN (SEN. MACEDA). Hindi, dahil iyong iba panay disciplinary
iyon e.
SEN. PIMENTEL. Anong page iyan, Rene?
THE CHAIRMAN (SEN. MACEDA). Page 29 Preventive Suspension.
REP. GUTANG. Ang complaint kasi ng mga tao, pagka may pulis na may
criminal case at may baril pa rin at nag-uuniforme, hindi magandang
tingnan e. So parang natatakot iyong mga witnesses.
SEN. GONZALES. Anyway, kung ma-exempt na rito naman siya e.
REP. GUTANG. Mayroong entitlement to reinstatement and pay. . . .
xxx xxx xxx
SEN. PIMENTEL. Dito sa "Preventive Suspension Pending Criminal Case."
Okay ito but I think we should also mandate the early termination of the
case. Ibig sabihin, okay, hindi ba "the suspension of the accused from office
until the case is terminated?" Alam naman natin ang takbo ng mga kaso rito
sa ating bansa e.
REP. ZAMORA. Twenty days, okay na.
SEN. PIMENTEL. Hindi, and ibig kong sabihin, let us just assume that a
case can be, as Rene pointed out, can run to six years bago
ma-terminate, sometimes ten years pa nga e. Okay, but maybe we should
mandate. . .
REP. ZAMORA. Continuous hearing.
SEN. PIMENTEL. Not only that, but the case must be terminated within a
period.

REP. ALBANO. Ninety days na ho sa Supreme Court the trial.


SEN. PIMENTEL. Ha?
REP. ALBANO. The trial must be done within ninety days,
SEN. PIMENTEL. Ang ibig kong sabihin kung maari sanang ilagay rito that
the case shall also be terminated in one year from the time . . . aywan ko
kung kaya nating gawin iyon.
REP. ALBANO. One solution, Mr. Chairman.
THE CHAIRMAN (SEN. MACEDA). Criminal case? Hindi ba that has all
been held as directory even if you put it in the law?
SEN. PIMENTEL. I know, but, iyon na nga, we are looking at some solution
to a particular situation.
SEN. ANGARA. Let's have continuous hearing and be terminated not later
than ninety days.
REP. ZAMORA. Ang point ni Ernie, that's really only the directory. All of
these, well, looks exactly the same thing.
SEN. ANGARA. No, but at least, we will shorten it up in a case like this. We
are really keen on having it quick, swift.
SEN. PIMENTEL. Swift justice.
REP. ALBANO. Mr. Chairman.
THE CHAIRMAN. (SEN. MACEDA). Yes.
REP. ALBANO. Following the Veloso case in Anti-graft cases before the
Sandiganbayan, the preventive suspension is only ninety days. In no case
shall it go beyond ninety days which can also be applicable here because
this is a preventive suspension.
SEN. PIMENTEL. No, because you can legislate at least.
SEN. SAGUISAG. But then the case may be anti-graft ha. The case filed
against a policeman may be anti-graft in nature. . .
SEN. PIMENTEL. Correct, correct, but is that a constitutional provision? Is
it?
REP. ALBANO. No, but as a standard procedure.
SEN. PIMENTEL. Then you can legislate.

THE CHAIRMAN (SEN. MACEDA). No, because this particular provision is


for criminal cases. I know anti-graft is a criminal case but here we are
talking, let's say, of murder, rape, treason, robbery. That's why it is in that
context that there is a difference between a purely anti-graft case and a
criminal case which could be a serious case since it is six years and one
day or more, so it must be already a grave felony.
xxx xxx xxx
REP. ALBANO. . . .
What I mean to say is, preventive suspension, we can use the
Veloso case.
THE CHAIRMAN (SEN. MACEDA). No, that's too short, that's what I am
saying. The feeling here is, for policeman, we have to be stricter especially
if it is a criminal case.
What Rene is just trying to say is, he is agreeable that the suspension is
until the case is terminated, but he just wants some administrative
balancing to expedite it. So let us study what kind of language could be
done along that line. So just on the National Police Commission . . .
SEN. ANGARA. Can I suggest a language that may reflect. . .
THE CHAIRMAN (SEN. MACEDA). Okay, please.
SEN. ANGARA. "Such case shall be subject to continuous trial and be
terminated not later than . . ." whatever we agree.
THE CHAIRMAN (SEN. MACEDA). Okay, so let's study that.
So if there are any further amendments to Chapter 2 on the National Police
Commission. . . . . . 13
The foregoing discussions reveal the legislative intent to place on preventive suspension a member of the
PNP charged with grave felonies where the penalty imposed by law exceeds six years of imprisonment
and which suspension continues until the case against him is terminated.
The reason why members of the PNP are treated differently from the other classes of persons charged
criminally or administratively insofar as the application of the rule on preventive suspension is concerned is
that policemen carry weapons and the badge of the law which can be used to harass or intimidate
witnesses against them, as succinctly brought out in the legislative discussions.
If a suspended policeman criminally charged with a serious offense is reinstated to his post while his case
is pending, his victim and the witnesses against him are obviously exposed to constant threat and thus
easily cowed to silence by the mere fact that the accused is in uniform and armed. The imposition of
preventive suspension for over 90 days under Section 47 of
R.A. 6975 does not violate the suspended policeman's constitutional right to equal protection of the laws.

The equal protection clause exists to prevent undue favor or privilege. It is intended to eliminate
discrimination and oppression based on inequality. Recognizing the existence of real differences among
men, the equal protection clause does not demand absolute equality. It merely requires that all persons
shall be treated alike, under like circumstances and conditions both as to the privileges conferred and
liabilities enforced. 14 Thus, the equal protection clause does not absolutely forbid classifications, such as the
one which exists in the instant case. If the classification is based on real and substantial differences; 15 is
germane to the purpose of the law; 16 applies to all members of the same
class; 17 and applies to current as well as future conditions, 18 the classification may not be impugned as violating
the Constitution's equal protection guarantee. A distinction based on real and reasonable considerations related
to a proper legislative purpose such as that which exists here is neither unreasonable, capricious nor
unfounded.
ACCORDINGLY, the petition is hereby DISMISSED.
SO ORDERED.
Narvasa, C.J., Cruz, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Quiason, Puno, Vitug and Mendoza,
JJ., concur.
Feliciano, Padilla and Bidin, JJ., are on leave.

# Footnotes
1 Criminal Case No. 27, 148-92, Rollo, p. 30.
2 Criminal Case No. 27, 147-92, Rollo, p. 29.
3 Rollo, pp. 32-33.
4 173 SCRA 409 (1989).
5 136 SCRA 536 (1985).
6 Rollo, pp. 24-26.
7 Id. at pp. 27-28.
8 REVISED PENAL CODE, Art. 207. The penalty of prision correccional in its minimum
period shall be imposed upon any judge guilty of malicious delay in the administration of
justice.
9 CIVIL CODE, Articles 27 and 32 provide:
Art. 27. Any person suffering material or moral loss because a public servant or employee
refuses or neglects, without just cause, to perform his official duty may file an action for
damages and other relief against the latter, without prejudice to any disciplinary
administrative action that may be taken.

Art. 32. Any public officer or employee, or any private individual, who directly or indirectly
obstructs, defeats, violates or in any manner impedes or impairs any of the following rights
and liberties of another person shall be liable to the latter for damages:
xxx xxx xxx
(16) The right of the accused to have a speedy and public trial,. . . .
10 Acebedo v. Sarmiento, 36 SCRA 247; Esguerra v. de la Costa, 66 Phil. 134; Kalaw v.
Apostol, 64 Phil. 852.

Today is Saturday, January 09, 2016

Republic of the Philippines


SUPREME COURT
Manila
EN BANC

G.R. No. 95367 May 23, 1995


COMMISSIONER JOSE T. ALMONTE, VILLAMOR C. PEREZ, NERIO ROGADO, and ELISA
RIVERA,petitioners,
vs.
HONORABLE CONRADO M. VASQUEZ and CONCERNED CITIZENS, respondents.

MENDOZA, J.:

This is a petition for certiorari, prohibition, and mandamus to annul the subpoena duces tecum and orders
issued by respondent Ombudsman, requiring petitioners Nerio Rogado and Elisa Rivera, as chief accountant
and record custodian, respectively, of the mEconoic Intelligence and Investigation Bureau (EIIB) to produce "a
documents relating to Personal Services Funds for the year 1988 and all evidence, such as vouchers (salary)
for the whole plantilla of EIIB for 1988" and to enjoin him from enforcing his orders.

Petitioner Jose T. Almonte was formerly Commissioner of the EIIB, while Villamor C. Perez is Chief of the
EIIB's Budget and Fiscal Management Division. The subpoena duces tecum was issued by the Ombudsman
connection with his investigation of an anonymous letter alleging that funds representing savings from unfilled
positions in the EIIB had been illegally disbursed. The letter, purporting to have been written by an employee
the EIIB and a concerned citizen, was addressed to the Secretary of Finance, with copies furnished several
government offices, including the Office of the Ombudsman.
The letter reads in pertinent parts:

1 These are the things that I have been observing. During the implementation of E.O. 127 on May 1, 1988, on
hundred ninety (190) personnel were dismissed. Before that implementation, we had a monthly savings of
P500,000.00 from unfilled plantilla position plus the implementation of RA 6683 wherein seventy (70) regular
employees availed a total amount of P1,400,000.00 was saved from the government monthly. The question is
how do they used or disbursed this savings? The EIIB has a syndicate headed by the Chief of Budget Divisio
who is manipulating funds and also the brain of the so called "ghost agents" or the "Emergency Intelligence
Agents" (EIA). The Commissioner of EIIB has a biggest share on this. Among his activities are:

a) Supporting RAM wherein he is involved. He gives big amount especially during the Dec. Failed coup.
b) Payment for thirty five (30) mini UZI's.
c) Payment for the purchased of Maxima '87 for personal used of the Commissioner.

d) Another observation was the agents under the Director of NCR EIIB is the sole operating unit within Metro
Manila which was approved by no less than the Commissioner due to anomalous activities of almost all agen
assigned at the central office directly under the Commissioner. Retired Brig. Gen. Almonte as one of the AntiGraft board member of the Department of Finance should not tolerate this. However, the Commissioner did n
investigate his own men instead, he placed them under the 15-30 payroll.
e) Many more which are personal.

2. Sir, my question is this. Can your good office investigate EII intelligence funds particularly Personal Service
(01) Funds? I wonder why the Dep't of Budget & Mgmt. cannot compel EIIB to submit an actual filled up
position because almost half of it are vacant and still they are releasing it. Are EIIB plantilla position classified
It is included in the Personal Services Itemization (PSI) and I believe it is not classified and a ruling from Civil
Service Commission that EIIB is not exempted from Civil Service. Another info, when we had salary differentia
last Oct '88 all money for the whole plantilla were released and from that alone, Millions were saved and
converted to ghost agents of EIA.

3. Another thing that I have observed was the Chief Budget Division possesses high caliber firearms such as
mini UZI, Armalite rifle and two (2) 45 cal. pistol issued to him by the Assistant Commissioner wherein he is no
an agent of EIIB and authorized as such according to memorandum order number 283 signed by the Preside
of the Republic of the Philippines effective 9 Jan. 1990.

Another observation was when EIIB agents apprehended a certain civilian who possesses numerous assorte
high powered firearms. Agents plus one personnel from the legal proclaimed only five (5) firearms and the
remaining was pilfered by them.

Another observation is almost all EIIB agents collects payroll from the big time smuggler syndicate monthly an
brokers every week for them not to be apprehended.
Another observation is the commissioner allocates funds coming from the intelligence funds to the media to
sustain their good image of the bureau.

In his comment 1 on the letter-complaint, petitioner Almonte denied that as a result of the separation of personnel,
the EIIB had made some savings. He averred that the only funds released to his agency by the Department of
Budget and Management (DBM) were those corresponding to 947 plantilla positions which were filled. He also
denied that there were "ghost agents" in the EIIB and claimed that disbursements for "open" (i.e., "overt" personne
and "closed" (i.e., "covert" personnel) plantillas of the agency had been cleared by the Commission on Audit (COA)
that the case of the 30 Uzis had already been investigated by Congress, where it was shown that it was not the EII
but an agent who had spent for the firearms and they were only loaned to the EIIB pending appropriation by
Congress; that, contrary to the charge that a Maxima car had been purchased for his use, he was using a
government issued car from the NICA; that it was his prerogative as Commissioner to "ground" agents in the EIIB
main office so that they could be given reorientation and retraining; that the allegation that the EIIB operatives
pilfered smuggled firearms was without factual basis because the firearms were the subject of seizure proceedings
before the Collector of Customs, Port of Manila; that the EIIB had been uncompromising toward employees found
involved in anomalous activities; and that intelligence funds had not been used for media propaganda and if media
people went to the EIIB it was because of newsworthy stories. Petitioner asked that the complaint be dismissed an

the case considered closed.

Similarly petitioner Perez, budget chief of the EIIB, denied in his comment 2 dated April 3, 1990 that savings ha
been realized from the implementation of E.O. No. 127, since the DBM provided allocations for only the remaining
947 personnel. He said that the disbursement of funds for the plantilla positions for "overt" and "covert" personnel
had been cleared by the COA and that the high-powered firearms had been issued for the protection of EIIB
personnel attending court hearings and the Finance Officer in withdrawing funds from the banks.

The Graft Investigation Officer of the Ombudsman's office, Jose F. Sao, found the comments unsatisfactory,
being "unverified and plying only on generalizations without meeting specifically the points raised by
complainant as constitutive of the alleged anomalies." 3 He, therefore, asked for authority to conduct a prelimina
investigation. Anticipating the grant of his request, he issued a subpoena 4 to petitioners Almonte and Perez,
requiring them to submit their counter-affidavits and the affidavits of their witnesses, as well as a subpoena duces
tecum 5 to the Chief of the EIIB's Accounting Division ordering him to bring "all documents relating to Personal
Services Funds for the year 1988 and all evidence, such as vouchers (salary) for the whole plantilla of EIIB for
1988."

Petitioners Almonte and Perez moved to quash the subpoena and the subpoena duces tecum. In his Order
dated June 15, 1990, 6 respondent Ombudsman granted the motion to quash the subpoena in view of the fact tha
there were no affidavits filed against petitioners. But he denied their motion to quash the subpoena duces tecum. H
ruled that petitioners were not being forced to produce evidence against themselves, since the subpoena duces
tecum was directed to the Chief Accountant, petitioner Nerio Rogado. In addition the Ombudsman ordered the Chie
of the Records a Section of the EIIB, petitioner Elisa Rivera, to produce before the investigator "all documents
relating to Personnel Service Funds, for the year 1988, and all documents, salary vouchers for the whole plantilla o
the EIIB for 1988, within ten (10) days from receipt hereof."
Petitioners Almonte and Perez moved for a reconsideration, arguing that Rogado and Rivera were EIIB
employees under their supervision and that the Ombudsman was doing indirectly what he could not do
directly,i.e., compelling them (petitioners Almonte and Perez) to produce evidence against themselves.
Petitioners' motion was denied in respondent Ombudsman's order dated August 6, 1990. Hence, this petition
which questions the orders of June 15, 1990 and August 6, 1990 of respondent Ombudsman.

To put this case in perspective it should be stated at the outset that it does not concern a demand by a citizen
for information under the freedom of information guarantee of the Constitution. 7 Rather it concerns the power o
the Office of the Ombudsman to obtain evidence in connection with an investigation conducted by it vis-a-vis the
claim of privilege of an agency of the Government. Thus petitioners raise the following issues: 8

I. WHETHER OR NOT A CASE BROUGHT ABOUT BY AN UNSIGNED AND UNVERIFIED LETTER


COMPLAINT IS AN "APPROPRIATE CASE" WITHIN THE CONCEPT OF THE CONSTITUTION IN WHICH
PUBLIC RESPONDENT CAN OBLIGE PETITIONERS BY VIRTUE OF HIS SUBPOENA DUCES TECUM TO
PRODUCE TO HIM "ALL DOCUMENTS RELATING TO PERSONAL SERVICES FUNDS FOR THE YEAR
1988 AND ALL EVIDENCES, SUCH AS VOUCHERS (SALARY) FOR THE WHOLE PLANTILLA OF EIIB FOR
1988."

II. WHETHER OR NOT "ALL DOCUMENTS RELATING TO PERSONAL SERVICES FUNDS FOR THE YEAR
1988 AND ALL EVIDENCES, SUCH AS VOUCHERS (SALARY) FOR THE WHOLE PLANTILLA OF EIIB FOR
1988" ARE CLASSIFIED AND, THEREFORE, BEYOND THE REACH OF PUBLIC RESPONDENT'S
SUBPOENA DUCES TECUM.

I.

There are several subsidiary issues raised by petitioners, but the principal ones revolve on the question
whether petitioners can be ordered to produce documents relating to personal services and salary vouchers o
EIIB employees on the plea that such documents are classified. Disclosure of the documents in question is
resisted on the ground that "knowledge of EIIB's documents relative to its Personal Services Funds and its
plantilla . . . will necessarily [lead to] knowledge of its operations, movements, targets, strategies, and tactics
and the whole of its being" and this could "destroy the EIIB." 9

Petitioners do not question the power of the Ombudsman to issue a subpoena duces tecum nor the relevancy
or materiality of the documents required to be produced, to the pending investigation in the Ombudsman's
office. Accordingly, the focus of discussion should be on the Government's claim of privilege.
A.

At common law a governmental privilege against disclosure is recognized with respect to state secrets bearin
on military, diplomatic and similar matters. This privilege is based upon public interest of such paramount
importance as in and of itself transcending the individual interests of a private citizen, even though, as a
consequence thereof, the plaintiff cannot enforce his legal rights. 10

In addition, in the litigation over the Watergate tape subpoena in 1973, the U.S. Supreme Court recognized th
right of the President to the confidentiality of his conversations and correspondence, which it likened to "the
claim of confidentiality of judicial deliberations." Said the Court in United States v. Nixon: 11

The expectation of a President to the confidentiality of his conversations and correspondence, like the claim o
confidentiality of judicial deliberations, for example, has all the values to which we accord deference for the
privacy of all citizens and, added to those values, is the necessity for protection of the public interest in candid
objective, and even blunt or harsh opinions in Presidential decision-making. A President and those who assis
him must be free to explore alternatives in the process of shaping policies and making decisions and to do so
in a way many would be unwilling to express except privately. These are the considerations justifying a
presumptive privilege for Presidential communications. The privilege is fundamental to the operation of the
government and inextricably rooted in the separation of powers under the Constitution. . . .

Thus, the Court for the first time gave executive privilege a constitutional status and a new name, although no
necessarily a new birth. 12

"The confidentiality of judicial deliberations" mentioned in the opinion of the Court referred to the fact that
Justices of the U.S. Supreme Court and judges of lower federal courts have traditionally treated their working
papers and judicial notes as private property. A 1977 proposal in the U.S. Congress that Justices and judges
lower federal courts "should be encouraged to make such arrangements as will assure the preservation and
eventual availability of their personal papers, especially the deposit of their papers in the same depository the
select for [their] Public Papers" 13 was rebuffed by the Justices who, in a letter to the Chairman of the
Subcommittee on Regulation and Government Information of the U.S. Senate, referred to "difficult concerns
respecting the appropriate separation that must be maintained between the legislative branch and this Court." 14
There are, in addition to such privileges, statutorily-created ones such as the Government's privilege to
withhold the identity of persons who furnish information of violations of laws. 15

With respect to the privilege based on state secret, the rule was stated by the U.S. Supreme Court as follows

Judicial control over the evidence in a case cannot be abdicated to the caprice of executive officers. Yet we w
not go so far as to say that the court may automatically require a complete disclosure to the judge before the
claim of privilege will be accepted in any case. It may be possible to satisfy the court, from all the
circumstances of the case, that there is a reasonable danger that compulsion of the evidence will expose
military matters which, in the interest of national security, should not be divulged. When this is the case, the
occasion for the privilege is appropriate, and the court should not jeopardize the security which the privilege is
meant to protect by insisting upon an examination of the evidence, even by the judge alone, in chambers. . . .
In each case, the showing of necessity which is made will determine how far the court should probe in
satisfying itself that the occasion for invoking the privilege is appropriate. Where there is a strong showing of
necessity, the claim of privilege should not be lightly accepted, but even the most compelling necessity canno
overcome the claim of privilege if the court is ultimately satisfied that military secrets are at stake. A fortiori,
where necessity is dubious, a formal claim of privilege, made under the circumstances of this case, will have
prevail. 16

On the other hand, where the claim of confidentiality does not rest on the need to protect military, diplomatic o
other national security secrets but on a general public interest in the confidentiality of his conversations, court
have declined to find in the Constitution an absolute privilege of the President against a subpoena considered
essential to the enforcement of criminal laws. 17
B.

In the case at bar, there is no claim that military or diplomatic secrets will be disclosed by the production of
records pertaining to the personnel of the EIIB. Indeed, EIIB's function is the gathering and evaluation of
intelligence reports and information regarding "illegal activities affecting the national economy, such as, but no
limited to, economic sabotage, smuggling, tax evasion, dollar salting." 18 Consequently, while in cases which
involve state secrets it may be sufficient to determine from the circumstances of the case that there is reasonable
danger that compulsion of the evidence will expose military matters without compelling production, 19 no similar
excuse can be made for a privilege resting on other considerations.
Nor has our attention been called to any law or regulation which considers personnel records of the EIIB as
classified information. To the contrary, COA Circular No. 88-293, which petitioners invoke to support their
contention that there is adequate safeguard against misuse of public funds, provides that the "only item of
expenditure which should be treated strictly confidential" is that which refers to the "purchase of information
and payment of rewards." Thus, part V, No. 7 of the Circular reads:

The only item of expenditure which should be treated as strictly confidential because it falls under the categor
of classified information is that relating to purchase of information and payment of rewards. However,
reasonable records should be maintained and kept for inspection of the Chairman, Commission on Audit or h
duly authorized representative. All other expenditures are to be considered unclassified supported by invoices
receipts and other documents, and, therefore, subject to reasonable inquiry by the Chairman or his duly
authorized representative. 20

It should be noted that the regulation requires that "reasonable records" be kept justifying the confidential or
privileged character of the information relating to informers. There are no such reasonable records in this cas
to substitute for the records claimed to be confidential.

The other statutes and regulations 21 invoked by petitioners in support of their contention that the documents
sought in the subpoena duces tecum of the Ombudsman are classified merely indicate the confidential nature of th
EIIB's functions, but they do not exempt the EIIB from the duty to account for its funds to the proper authorities.
Indeed by denying that there were savings made from certain items in the agency and alleging that the DBM had
released to the EIIB only the allocations needed for the 947 personnel retained after its reorganization, petitioners i

effect invited inquiry into the veracity of their claim. If, as petitioners claim, the subpoenaed records have been
examined by the COA and found by it to be regular in all respects, there is no reason why they cannot be shown to
another agency of the government which by constitutional mandate is required to look into any complaint concernin
public office.

On the other hand, the Ombudsman is investigating a complaint that several items in the EIIB were filled by
fictitious persons and that the allotments for these items in 1988 were used for illegal purposes. The plantilla
and other personnel records are relevant to his investigation. He and his Deputies are designated by the
Constitution "protectors of the people" and as such they are required by it "to act promptly on complaints in an
form or manner against public officials or employees of the Government, or any subdivision, agency or
instrumentality thereof, including government-owned or controlled corporation." 22

His need for the documents thus outweighs the claim of confidentiality of petitioners. What is more, while ther
might have been compelling reasons for the claim of privilege in 1988 when it was asserted by petitioners, no
seven years later, these reasons may have been attenuated, if they have not in fact ceased. The agents whos
identities could not then be revealed may have ceased from the service of the EIIB, while the covert missions
to which they might have been deployed might either have been accomplished or abandoned. On the other
hand, the Ombudsman's duty to investigate the complaint that there were in 1988 unfilled positions in the EIIB
for which continued funding was received by its officials and put to illegal use, remains.

Above all, even if the subpoenaed documents are treated as presumptively privileged, this decision would onl
justify ordering their inspection in camera but not their nonproduction. However, as concession to the nature o
the functions of the EIIB and just to be sure no information of a confidential character is disclosed, the
examination of records in this case should be made in strict confidence by the Ombudsman himself. Referenc
may be made to the documents in any decision or order which the Ombudsman may render or issue but only
to the extent that it will not reveal covert activities of the agency. Above all, there must be a scrupulous
protection of the documents delivered.

With these safeguards outlined, it is believed that a satisfactory resolution of the conflicting claims of the
parties is achieved. It is not amiss to state that even matters of national security have been inquired into in
appropriate in camera proceedings by the courts. In Lansang v. Garcia 23 this Court held closed door sessions,
with only the immediate parties and their counsel present, to determine claims that because of subversion there wa
imminent danger to public safety warranting the suspension of the writ of habeas corpus in 1971. Again in Marcos
v. Manglapus 24 the Court met behind closed doors to receive military briefings on the threat posed to national
security by the return to the country of the former President and his family. In the United States, a similar inquiry int
the danger to national security as a result of the publication of classified documents on the Vietnam war was upheld
by the U.S. Supreme Court. 25 We see no reason why similar safeguards cannot be made to enable an agency of th
Government, like the Office of the Ombudsman, to carry out its constitutional duty to protect public interests 26 while
insuring the confidentiality of classified documents.
C.

Petitioners contend that under Art. XI, 13(4) the Ombudsman can act only "in any appropriate case, and
subject to such limitations as may be provided by law" and that because the complaint in this case is unsigne
and unverified, the case is not an appropriate one. This contention lacks merit. As already stated, the
Constitution expressly enjoins the Ombudsman to act on any complaint filed "in any form or manner"
concerning official acts or omissions. Thus, Art. XI, 12 provides:

The Ombudsman and his Deputies, as protectors of the people, shall act promptly on complaints filed in any
form or manner against public officials or employees of the Government, or any subdivision, agency, or
instrumentality thereof, including government-owned or controlled corporations and shall in appropriate cases

notify the complainants of the action taken and the result thereof. (Emphasis added)
Similarly, the Ombudsman Act of 1989 (Rep. Act No. 6770) provides in 26(2):

The Office of the Ombudsman shall receive complaints from any source in whatever form concerning an offic
act or omission. It shall act on the complaint immediately and if it finds the same entirely baseless, it shall
dismiss the same and inform the complainant of such dismissal citing the reasons therefor. If it finds a
reasonable ground to investigate further, it shall first furnish the respondent public officer or employee with a
summary of the complaint and require him to submit a written answer within seventy-two hours from receipt
thereof. If the answer is found satisfactory, it shall dismiss the case. (Emphasis added)
Accordingly, in Diaz v. Sandiganbayan 27 the Court held that testimony given at a fact-finding investigation and
charges made in a pleading in a case in court constituted a sufficient basis for the Ombudsman to commence
investigation, because a formal complaint was really not necessary.

Rather than referring to the form of complaints, therefore, the phrase "in an appropriate case" in Art. XI, 12
means any case concerning official act or omission which is alleged to be "illegal, unjust, improper, or
inefficient."28 The phrase "subject to such limitations as may be provided by law" refers to such limitations as may b
provided by Congress or, in the absence thereof, to such limitations as may be imposed by the courts. Such
limitations may well include a requirement that the investigation be concluded in camera, with the public excluded,
exception to the general nature of the proceedings in the Office of the Ombudsman. 29 A reconciliation is thereby
made between the demands of national security and the requirement of accountability enshrined in the
Constitution. 30

What has been said above disposes of petitioners' contention that the anonymous letter-complaint against
them is nothing but a vexatious prosecution. It only remains to say that the general investigation in the
Ombudsman' s office is precisely for the purpose of protecting those against whom a complaint is filed agains
hasty, malicious, and oppressive prosecution as much as securing the State from useless and expensive trial
There may also be benefit resulting from such limited in camera inspection in terms of increased public
confidence that the privilege is not being abused and increased likelihood that no abuse is in fact occurring.
II.

Nor is there violation of petitioner's right to the equal protection of the laws. Petitioners complain that "in all
forum and tribunals . . . the aggrieved parties . . . can only hale respondents via their verified complaints or
sworn statements with their identities fully disclosed," while in proceedings before the Office of the
Ombudsman anonymous letters suffice to start an investigation. In the first place, there can be no objection to
this procedure because it is provided in the Constitution itself. In the second place, it is apparent that in
permitting the filing of complaints "in any form and in a manner," the framers of the Constitution took into
account the well-known reticence of the people which keep them from complaining against official
wrongdoings. As this Court had occasion to point out, the Office of the Ombudsman is different from the other
investigatory and prosecutory agencies of the government because those subject to its jurisdiction are public
officials who, through official pressure and influence, can quash, delay or dismiss investigations held against
them. 31 On the other hand complainants are more often than not poor and simple folk who cannot afford to hire
lawyers. 32
III.
Finally, it is contended that the issuance of the subpoena duces tecum would violate petitioners' right against
self-incrimination. It is enough to state that the documents required to be produced in this case are public
records and those to whom the subpoena duces tecum is directed are government officials in whose

possession or custody the documents are. Moreover, if, as petitioners claim the disbursement by the EIIB of
funds for personal service has already been cleared by the COA, there is no reason why they should object to
the examination of the documents by respondent Ombudsman.

WHEREFORE, the petition is DISMISSED, but it is directed that the inspection of subpoenaed documents be
made personally in camera by the Ombudsman, and with all the safeguards outlined in this decision.
SO ORDERED.
Narvasa, C.J., Feliciano, Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Quiason, Puno and Vitug,
JJ., concur.
Francisco, J., is on leave.

Separate Opinions

KAPUNAN, J., dissenting:

The well-written ponencia of Mr. Justice Mendoza would postulate that the Economic Intelligence and
Investigation Bureau (EIIB) documents relating to the Personal Services Funds for the year 1988 and all
documentary evidence, including salary vouchers for the whole plantilla of the EIIB for 1988 be produced
before the Ombudsman over the objections of the EIIB Commissioner on the ground that the documents
contain highly confidential matters, apart from the fact that the expenditures had been cleared in audit by the
Commission on Audit (COA). The reasons relied upon in the ponencia are a) that the EIIB documents at issue
are not classified under COA (Commission on Audit) Circular No. 88-293, Part V No. 7 which limits such
matters exclusively to expenditures relating to the purchase of information and payment of rewards; and b) th
documents relating to disbursement and expenditures of the EIIB for personal funds had already been
previously examined by the Commission on Audit when such outlay had been passed upon in audit in the sai
Office, such that there is no confidentiality privilege to protect.
With due respect, I beg to disagree.

Disclosure of the documents as required by the Ombudsman would necessarily defeat the legal mandate of t
EIIB as the intelligence arm of the executive branch of government relating to matters affecting the economy
the nation. As such, EIIB's functions are related to matters affecting national security. In the performance of its
function in relation with the gathering of intelligence information executive privilege could as well be invoked b
the EIIB, especially in relation to its covert operations.

The determination, by the executive branch, through its appropriate agencies, of a question as affecting the
national security is a policy decision for which this Court has neither the competence nor the mandate to
infringe upon. In the absence of a clear showing a grave abuse of discretion on the part of the Executive,
acting through its (national security) agencies, I am of the opinion that we cannot interfere with a determinatio

properly made, on a question affecting economic security lest we are prepared to ride roughshod over certain
prerogatives of our political branches. In an area obviously affecting the national security, disclosure of
confidential information on the promptings of some dissatisfied employees would potentially disturb a number
of carefully laid-out operations dependent on secrecy and I am not prepared to do this. The characterization o
the documents as classified information is not a shield for wrongdoing but a barrier against the burden some
requests for information which necessarily interfere with the proper performance of their duties. To give in, at
every turn, to such requests would be greatly disruptive of governmental functions. More so in this case, since
expenditures of the EIIB for personal funds had already been previously examined and passed upon in audit
the Commission on Audit. There has been no allegation of any irregularity in the COA's earlier examination,
and in the absence of substantiated allegations, the previous determination ought to be accorded our respect
unless we want to encourage unnecessary and tiresome forays and investigations into government activities
which would not only end up nowhere but which would also disrupt or derail such activities.

The confidentiality privilege invoked by petitioners attaches in the exercise of the functions of the EIIB, as
presidential immunity is bestowed by reason of the political functions of the Chief Executive, as a separate an
co-equal branch of government. By the same parity of reasoning, the disclosure of the EIIB documents
required to be examined by the Ombudsman even in camera proceedings will under the pretext of ascertainin
the proper disbursements of the EIIB funds will unnecessarily impair the performance by the EIIB of its
functions especially those affecting national security.

The constitutional right allowing disclosure of governmental documents, i.e., the right to information on matter
of public concern is not absolute. While access to official records may not be prohibited, it may be
regulated. 1Regulation includes appropriate authority to determine what documents are of public concern, the
manner of access to information contained in such documents and to withhold information under certain
circumstances, particularly, as in this case, those circumstances affecting the national security. 2

Besides, as I emphasized earlier, the determination of the legality of EIIB's disbursements of funds allocated t
it are properly within the competence of the Commission on Audit, which as the ponencia of Justice Mendoza
finds, has been cleared in audit. The Commission on Audit had adopted, as in the past, measures to protect
"classified information" pertaining to examination of expenditures of intelligence agencies. In the present case
disclosure of information to any other agency would unnecessarily expose the covert operations of EIIB, as a
government agency charged with national security functions.
I, therefore, vote to give due course to the petition.

Separate Opinions
KAPUNAN, J., dissenting:

The well-written ponencia of Mr. Justice Mendoza would postulate that the Economic Intelligence and
Investigation Bureau (EIIB) documents relating to the Personal Services Funds for the year 1988 and all
documentary evidence, including salary vouchers for the whole plantilla of the EIIB for 1988 be produced
before the Ombudsman over the objections of the EIIB Commissioner on the ground that the documents
contain highly confidential matters, apart from the fact that the expenditures had been cleared in audit by the
Commission on Audit (COA). The reasons relied upon in the ponencia are a) that the EIIB documents at issue
are not classified under COA (Commission on Audit) Circular No. 88-293, Part V No. 7 which limits such
matters exclusively to expenditures relating to the purchase of information and payment of rewards; and b) th

documents relating to disbursement and expenditures of the EIIB for personal funds had already been
previously examined by the Commission on Audit when such outlay had been passed upon in audit in the sai
Office, such that there is no confidentiality privilege to protect.
With due respect, I beg to disagree.

Disclosure of the documents as required by the Ombudsman would necessarily defeat the legal mandate of t
EIIB as the intelligence arm of the executive branch of government relating to matters affecting the economy
the nation. As such, EIIB's functions are related to matters affecting national security. In the performance of its
function in relation with the gathering of intelligence information executive privilege could as well be invoked b
the EIIB, especially in relation to its covert operations.

The determination, by the executive branch, through its appropriate agencies, of a question as affecting the
national security is a policy decision for which this Court has neither the competence nor the mandate to
infringe upon. In the absence of a clear showing a grave abuse of discretion on the part of the Executive,
acting through its (national security) agencies, I am of the opinion that we cannot interfere with a determinatio
properly made, on a question affecting economic security lest we are prepared to ride roughshod over certain
prerogatives of our political branches. In an area obviously affecting the national security, disclosure of
confidential information on the promptings of some dissatisfied employees would potentially disturb a number
of carefully laid-out operations dependent on secrecy and I am not prepared to do this. The characterization o
the documents as classified information is not a shield for wrongdoing but a barrier against the burden some
requests for information which necessarily interfere with the proper performance of their duties. To give in, at
every turn, to such requests would be greatly disruptive of governmental functions. More so in this case, since
expenditures of the EIIB for personal funds had already been previously examined and passed upon in audit
the Commission on Audit. There has been no allegation of any irregularity in the COA's earlier examination,
and in the absence of substantiated allegations, the previous determination ought to be accorded our respect
unless we want to encourage unnecessary and tiresome forays and investigations into government activities
which would not only end up nowhere but which would also disrupt or derail such activities.

The confidentiality privilege invoked by petitioners attaches in the exercise of the functions of the EIIB, as
presidential immunity is bestowed by reason of the political functions of the Chief Executive, as a separate an
co-equal branch of government. By the same parity of reasoning, the disclosure of the EIIB documents
required to be examined by the Ombudsman even in camera proceedings will under the pretext of ascertainin
the proper disbursements of the EIIB funds will unnecessarily impair the performance by the EIIB of its
functions especially those affecting national security.

The constitutional right allowing disclosure of governmental documents, i.e., the right to information on matter
of public concern is not absolute. While access to official records may not be prohibited, it may be
regulated. 1Regulation includes appropriate authority to determine what documents are of public concern, the
manner of access to information contained in such documents and to withhold information under certain
circumstances, particularly, as in this case, those circumstances affecting the national security. 2

Besides, as I emphasized earlier, the determination of the legality of EIIB's disbursements of funds allocated t
it are properly within the competence of the Commission on Audit, which as the ponencia of Justice Mendoza
finds, has been cleared in audit. The Commission on Audit had adopted, as in the past, measures to protect
"classified information" pertaining to examination of expenditures of intelligence agencies. In the present case
disclosure of information to any other agency would unnecessarily expose the covert operations of EIIB, as a
government agency charged with national security functions.
I, therefore, vote to give due course to the petition.

Footnotes
1 Rollo, pp. 36-37.
2 Id., p. 38.
3 Id., p. 39.
4 Id., p. 41.
5 Id., p. 42.
6 Id., pp. 53-54.

7 Art. III, 7 provides: "The right of the people to information on matters of public concern shall be recognized
Access to official records, and to documents, and papers pertaining to official acts, transactions, or decisions,
as well as to government research data used as basis for policy development, shall be afforded the citizen,
subject to such limitations as may be provided by law."
8 Petitioners' Memorandum, p. 6.
9 Petitioners' Memorandum, p. 27.

10 Anno., Government Privilege Against Disclosure of Official Information, 95 L. Ed. 3-4 and 7, pp. 427-29,
434.
11 418 U.S. 683, 708-9, 41 L. Ed. 2d 1039, 1061-4 (1973).

12 Freund, The Supreme Court 1973 Term Foreword: On Presidential Privilege, 88 HARV. L. REV. 13, 1835 (1974).

13 Final Report of the National Study Commission on Records and Documents of Federal Officials (March 31
1977), quoted in BLOCH & KRATTENMAKER, SUPREME COURT POLITICS: THE INSTITUTION AND ITS
PROCEDURES 677-87 (1994).
14 Letter of Chief Justice William H. Rehnquist dated June 7, 1993 to Sen. Joseph I. Lieberman, Chairman,
Subcommittee on Regulation and Government Information, U.S. Senate, quoted in BLOCH &
KRATTENMAKER, id., at 687-8.
15 COA Circular No. 88-293.

16 United States v. Reynolds, 345 U.S. 1, 10-11, 97 L. Ed. 727, 734-35 (1953). In this case the U.S. Supreme
Court reversed a lower court order requiring the government to produce documents relating to the crash of a
military aircraft which had been engaged in a secret mission to test electronic equipment. The fact conceded
respondents, that the aircraft was on secret military mission, justified nonproduction of the report of the
accident. It was apparent the report contained state secrets which in the interest of national security could not
be divulged even in the chambers of the judge or in camera. There was "a reasonable danger that the
investigation report would contain references to the secret electronic equipment which was the primary conce

of the mission."

17 In United States v. Nixon, 418 U.S. 683, 41 L. Ed. 2d 1039 (1974), the Court, while acknowledging that the
President's need "for complete candor and objectivity from advisers calls for great deference from the courts,"
nonetheless held that such generalized claim of confidentiality could not prevail over the "specific need for
evidence in a pending criminal trial." Accordingly the Court ordered the tapes of conversations of President
Nixon to be turned over to the trial judge for in camera inspection to determine whether they were relevant an
admissible apart from being privileged. Similarly in Nixon v. Administrator of General Services, 433 U.S. 425,
53 L. Ed. 2d 867 (1977) it was held that the mere screening of tapes and other records of President Nixon's
conversations with employees of the Federal Government, to be done by professional archivists for the
purpose of "legitimate historical and governmental purpose," constituted "a very limited intrusion . . . into
executive confidentiality comparable to those held to justify in camera inspection." 433 U.S. at 451-52, 53 L.
Ed. 2d. at 896-97. Accordingly the validity of the law, entitled "Presidential Recordings and Materials
Preservation Act," was upheld against the claim that "the Presidential privilege shields the records from
archival scrutiny."
18 E.O. No. 127.
19 United States v. Reynolds, supra note 16.
20 Quoted in Petitioners' Memorandum, p. 27.
21 Petitioners cite in their Memorandum, at p. 19, the following:

19. Release of Intelligence and Confidential Funds. Intelligence and confidential funds provided for in the
budgets of departments, bureaus, offices or other agencies of the national government,including amounts fro
savings authorized by Special Provisions to be used for intelligence and counter-intelligence activities, shall b
released only upon approval of the President of the Philippines. (RA 6642-GAA for CY 1988).

Effective immediately, all requests for the allocation or release of intelligence funds shall indicate in full detail
the specific purposes for which said funds shall be spent and shall explain the circumstances giving rise to the
necessity for the expenditure and the particular aims to be accomplished. (Letter of Instructions No. 1282 date
January 12, 1983).

Any disbursement of intelligence funds should not be allowed in audit, unless it is in strict compliance with the
provisions of Letters of Instruction
No. . . . and 1282. Any officer or employee who violates the provisions of the aforementioned Letter of
Instruction shall be dealt with administratively without prejudice to any criminal action that may be warranted.
(Memorandum Circular No. 1290 of the Office of the President dated August 19, 1985).
22 Art. XI, 12.
23 42 SCRA 448 (1971).
24 117 SCRA 668 (1989).

25 New York Times Co. v. United States [The Pentagon Papers Case], 403 U.S. 713, 29 L. Ed. 2d 822 (1971)
26 Art. XI, 13. The Office of the Ombudsman shall have the following powers, functions, and duties:

(1) Investigate on its own, or on complaint by any person, any act or omission of any public official, employee
office or agency, when such act or omission appears to be illegal, unjust, improper, or inefficient.
(2) Direct, upon complaint or at its own instance, any public official or employee of the Government, or any
subdivision, agency or instrumentality thereof, as well as of any government-owned or controlled corporation
with original charter, to perform and expedite any act or duty required by law, or to stop, prevent and correct
any abuse or impropriety in the performance of duties.
(3) Direct the officer concerned to take appropriate action against a public official or employee at fault, and
recommend his removal, suspension, demotion, fine, censure, or prosecution, and ensure compliance
therewith.

(4) Direct the officer concerned, in any appropriate case, and subject to such limitations as may be provided b
law, to furnish it with copies of documents relating to contracts or transactions entered into by his office
involving the disbursement or use of public funds or properties, and report any irregularity to the Commission
on Audit for appropriate action.
(5) Request any government agency for assistance and information necessary in the discharge of its
responsibilities, and to examine, if necessary, pertinent records and documents.
xxx xxx xxx

(7) Determine the causes of inefficiency, red tape, mismanagement, fraud, and corruption in the Government
and make recommendations or their elimination and the observance of high standards of ethics and efficiency

In the performance of his functions the Ombudsman is given under Republic Act No. 6770, 15(8) the power
to issue subpoena and subpoena duces tecum.
27 219 SCRA 675 (1993).
28 Art. XI, 13(1).
29 Art. XI, 13(6) requires the Office of the Ombudsman to "publicize matters covered by its investigation
when circumstances so warrant and with due prudence."
30 Art. XI, 1 provides: "Public office is a public trust. Public officers and employees must at all times be
accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency, act with
patriotism and justice and lead modest lives."
31 Deloso v. Domingo, 191 SCRA 545, 551 (1990).
32 2 RECORD OF THE CONSTITUTIONAL COMMISSION, pp. 369-370.
KAPUNAN, J., dissenting:
1 BERNAS, I THE CONSTITUTION OF THE REPUBLIC OF THE PHILIPPINES, 265 (1987).
2 See id., at 267.

The Lawphil Project - Arellano Law Foundation

11 See note 5, supra, pp. 541-542.


12 Pascual v. Pascual-Bautista, 207 SCRA 567.
13 Senate and House Bicameral Conference Committee on National Defense, May
15, 1990, pp. 1-7.
14 COOLEY, CONSTITUTIONAL LIMITATIONS, 824-825.
15 Villegas vs. Hiu Chiong Tsai Pao Ho, 86 SCRA 270, 275 (1978).
16 Ichong v. Hernandez, 101 Phil. 1155 (1957).
17 Id., at p. 1176.
18 Id.

Republic of the Philippines


SUPREME COURT
Manila
EN BANC

G.R. No. 113105 August 19, 1994


PHILIPPINE CONSTITUTION ASSOCIATION, EXEQUIEL B. GARCIA and A. GONZALES, petitioners,
vs.
HON. SALVADOR ENRIQUEZ, as Secretary of Budget and Management; HON. VICENTE T. TAN, as
National Treasurer and COMMISSION ON AUDIT, respondents.
G.R. No. 113174 August 19, 1994
RAUL S. ROCO, as Member of the Philippine Senate, NEPTALI A. GONZALES, Chairman of the
Committee on Finance of the Philippine Senate, and EDGARDO J. ANGARA, as President and Chief
Executive of the Philippine Senate, all of whom also sue as taxpayers, in their own behalf and in
representation of Senators HEHERSON ALVAREZ, AGAPITO A. AQUINO, RODOLFO G. BIAZON,
JOSE D. LINA, JR., ERNESTO F. HERRERA, BLAS F. OPLE, JOHN H. OSMENA, GLORIA
MACAPAGAL- ARROYO, VICENTE C. SOTTO III, ARTURO M. TOLENTINO, FRANCISCO S. TATAD,
WIGBERTO E. TAADA and FREDDIE N. WEBB, petitioners,
vs.
THE EXECUTIVE SECRETARY, THE DEPARTMENT OF BUDGET AND MANAGEMENT, and THE

NATIONAL TREASURER, THE COMMISSION ON AUDIT, impleaded herein as an unwilling


co-petitioner, respondents.
G.R. No. 113766 August 19, 1994
WIGBERTO E. TAADA and ALBERTO G. ROMULO, as Members of the Senate and as taxpayers,
and FREEDOM FROM DEBT COALITION, petitioners,
vs.
HON. TEOFISTO T. GUINGONA, JR. in his capacity as Executive Secretary, HON. SALVADOR
ENRIQUEZ, JR., in his capacity as Secretary of the Department of Budget and Management, HON.
CARIDAD VALDEHUESA, in her capacity as National Treasurer, and THE COMMISSION ON
AUDIT, respondents.
G.R. No. 113888 August 19, 1994
WIGBERTO E. TAADA and ALBERTO G. ROMULO, as Members of the Senate and as
taxpayers,petitioners,
vs.
HON. TEOFISTO T. GUINGONA, JR., in his capacity as Executive Secretary, HON. SALVADOR
ENRIQUEZ, JR., in his capacity as Secretary of the Department of Budget and Management, HON.
CARIDAD VALDEHUESA, in her capacity as National Treasurer, and THE COMMISSION ON
AUDIT, respondents.
Ramon R. Gonzales for petitioners in G.R. No. 113105.
Eddie Tamondong for petitioners in G.R. Nos. 113766 & 113888.
Roco, Buag, Kapunan, Migallos & Jardeleza for petitioners Raul S. Roco, Neptali A. Gonzales and
Edgardo Angara.
Ceferino Padua Law Office fro intervenor Lawyers Against Monopoly and Poverty (Lamp).

QUIASON, J.:
Once again this Court is called upon to rule on the conflicting claims of authority between the Legislative
and the Executive in the clash of the powers of the purse and the sword. Providing the focus for the
contest between the President and the Congress over control of the national budget are the four cases at
bench. Judicial intervention is being sought by a group of concerned taxpayers on the claim that Congress
and the President have impermissibly exceeded their respective authorities, and by several Senators on
the claim that the President has committed grave abuse of discretion or acted without jurisdiction in the
exercise of his veto power.
I
House Bill No. 10900, the General Appropriation Bill of 1994 (GAB of 1994), was passed and approved by
both houses of Congress on December 17, 1993. As passed, it imposed conditions and limitations on
certain items of appropriations in the proposed budget previously submitted by the President. It also
authorized members of Congress to propose and identify projects in the "pork barrels" allotted to them and
to realign their respective operating budgets.

Pursuant to the procedure on the passage and enactment of bills as prescribed by the Constitution,
Congress presented the said bill to the President for consideration and approval.
On December 30, 1993, the President signed the bill into law, and declared the same to have become
Republic Act No. 7663, entitled "AN ACT APPROPRIATING FUNDS FOR THE OPERATION OF THE
GOVERNMENT OF THE PHILIPPINES FROM JANUARY ONE TO DECEMBER THIRTY ONE,
NINETEEN HUNDRED AND NINETY-FOUR, AND FOR OTHER PURPOSES" (GAA of 1994). On the
same day, the President delivered his Presidential Veto Message, specifying the provisions of the bill he
vetoed and on which he imposed certain conditions.
No step was taken in either House of Congress to override the vetoes.
In G.R. No. 113105, the Philippine Constitution Association, Exequiel B. Garcia and Ramon A. Gonzales as
taxpayers, prayed for a writ of prohibition to declare as unconstitutional and void: (a) Article XLI on the
Countrywide Development Fund, the special provision in Article I entitled Realignment of Allocation for
Operational Expenses, and Article XLVIII on the Appropriation for Debt Service or the amount appropriated
under said Article XLVIII in excess of the P37.9 Billion allocated for the Department of Education, Culture
and Sports; and (b) the veto of the President of the Special Provision of
Article XLVIII of the GAA of 1994 (Rollo, pp. 88-90, 104-105)
In G.R. No. 113174, sixteen members of the Senate led by Senate President Edgardo J. Angara, Senator
Neptali A. Gonzales, the Chairman of the Committee on Finance, and Senator Raul S. Roco, sought the
issuance of the writs of certiorari, prohibition and mandamus against the Executive Secretary, the
Secretary of the Department of Budget and Management, and the National Treasurer.
Suing as members of the Senate and taxpayers, petitioners question: (1) the constitutionality of the
conditions imposed by the President in the items of the GAA of 1994: (a) for the Supreme Court, (b)
Commission on Audit (COA), (c) Ombudsman, (d) Commission on Human Rights (CHR), (e) Citizen Armed
Forces Geographical Units (CAFGU'S) and (f) State Universities and Colleges (SUC's); and (2) the
constitutionality of the veto of the special provision in the appropriation for debt service.
In G.R. No. 113766, Senators Alberto G. Romulo and Wigberto Taada (a co-petitioner in G.R. No.
113174), together with the Freedom from Debt Coalition, a non-stock domestic corporation, sought the
issuance of the writs of prohibition and mandamus against the Executive Secretary, the Secretary of the
Department of Budget and Management, the National Treasurer, and the COA.
Petitioners Taada and Romulo sued as members of the Philippine Senate and taxpayers, while petitioner
Freedom from Debt Coalition sued as a taxpayer. They challenge the constitutionality of the Presidential
veto of the special provision in the appropriations for debt service and the automatic appropriation of funds
therefor.
In G.R. No. 11388, Senators Taada and Romulo sought the issuance of the writs of prohibition and
mandamus against the same respondents in G.R. No. 113766. In this petition, petitioners contest the
constitutionality of: (1) the veto on four special provision added to items in the GAA of 1994 for the Armed
Forces of the Philippines (AFP) and the Department of Public Works and Highways (DPWH); and (2) the
conditions imposed by the President in the implementation of certain appropriations for the CAFGU's, the
DPWH, and the National Housing Authority (NHA).
Petitioners also sought the issuance of temporary restraining orders to enjoin respondents Secretary of
Budget and Management, National Treasurer and COA from enforcing the questioned provisions of the
GAA of 1994, but the Court declined to grant said provisional reliefs on the time- honored principle of
according the presumption of validity to statutes and the presumption of regularity to official acts.

In view of the importance and novelty of most of the issues raised in the four petitions, the Court invited
former Chief Justice Enrique M. Fernando and former Associate Justice Irene Cortes to submit their
respective memoranda as Amicus curiae, which they graciously did.
II
Locus Standi
When issues of constitutionality are raised, the Court can exercise its power of judicial review only if the
following requisites are compresent: (1) the existence of an actual and appropriate case; (2) a personal
and substantial interest of the party raising the constitutional question; (3) the exercise of judicial review is
pleaded at the earliest opportunity; and (4) the constitutional question is the lis mota of the case (Luz
Farms v. Secretary of the Department of Agrarian Reform, 192 SCRA 51 [1990]; Dumlao v. Commission on
Elections, 95 SCRA 392 [1980]; People v. Vera, 65 Phil. 56 [1937]).
While the Solicitor General did not question the locus standi of petitioners in G.R. No. 113105, he claimed
that the remedy of the Senators in the other petitions is political (i.e., to override the vetoes) in effect saying
that they do not have the requisite legal standing to bring the suits.
The legal standing of the Senate, as an institution, was recognized in Gonzales v. Macaraig, Jr., 191
SCRA 452 (1990). In said case, 23 Senators, comprising the entire membership of the Upper House of
Congress, filed a petition to nullify the presidential veto of Section 55 of the GAA of 1989. The filing of the
suit was authorized by Senate Resolution No. 381, adopted on February 2, 1989, and which reads as
follows:
Authorizing and Directing the Committee on Finance to Bring in the Name of the Senate of
the Philippines the Proper Suit with the Supreme Court of the Philippines contesting the
Constitutionality of the Veto by the President of Special and General Provisions, particularly
Section 55, of the General Appropriation Bill of 1989 (H.B. No. 19186) and For Other
Purposes.
In the United States, the legal standing of a House of Congress to sue has been recognized (United States
v. American Tel. & Tel. Co., 551 F. 2d 384, 391 [1976]; Notes: Congressional Access To The Federal
Courts, 90 Harvard Law Review 1632 [1977]).
While the petition in G.R. No. 113174 was filed by 16 Senators, including the Senate President and the
Chairman of the Committee on Finance, the suit was not authorized by the Senate itself. Likewise, the
petitions in
G.R. Nos. 113766 and 113888 were filed without an enabling resolution for the purpose.
Therefore, the question of the legal standing of petitioners in the three cases becomes a preliminary issue
before this Court can inquire into the validity of the presidential veto and the conditions for the
implementation of some items in the GAA of 1994.
We rule that a member of the Senate, and of the House of Representatives for that matter, has the legal
standing to question the validity of a presidential veto or a condition imposed on an item in an
appropriation bill.
Where the veto is claimed to have been made without or in excess of the authority vested on the President
by the Constitution, the issue of an impermissible intrusion of the Executive into the domain of the

Legislature arises (Notes: Congressional Standing To Challenge Executive Action, 122 University of
Pennsylvania Law Review 1366 [1974]).
To the extent the power of Congress are impaired, so is the power of each member thereof, since his office
confers a right to participate in the exercise of the powers of that institution (Coleman v. Miller, 307 U.S.
433 [1939]; Holtzman v. Schlesinger, 484 F. 2d 1307 [1973]).
An act of the Executive which injures the institution of Congress causes a derivative but nonetheless
substantial injury, which can be questioned by a member of Congress (Kennedy v. Jones, 412 F. Supp.
353 [1976]). In such a case, any member of Congress can have a resort to the courts.
Former Chief Justice Enrique M. Fernando, as Amicus Curiae, noted:
This is, then, the clearest case of the Senate as a whole or individual Senators as such
having a substantial interest in the question at issue. It could likewise be said that there
was the requisite injury to their rights as Senators. It would then be futile to raise any locus
standi issue. Any intrusion into the domain appertaining to the Senate is to be resisted.
Similarly, if the situation were reversed, and it is the Executive Branch that could allege a
transgression, its officials could likewise file the corresponding action. What cannot be
denied is that a Senator has standing to maintain inviolate the prerogatives, powers and
privileges vested by the Constitution in his office (Memorandum, p. 14).
It is true that the Constitution provides a mechanism for overriding a veto (Art. VI, Sec. 27 [1]). Said
remedy, however, is available only when the presidential veto is based on policy or political considerations
but not when the veto is claimed to be ultra vires. In the latter case, it becomes the duty of the Court to
draw the dividing line where the exercise of executive power ends and the bounds of legislative jurisdiction
begin.
III
G.R. No. 113105
1. Countrywide Development Fund
Article XLI of the GAA of 1994 sets up a Countrywide Development Fund of P2,977,000,000.00 to "be
used for infrastructure, purchase of ambulances and computers and other priority projects and activities
and credit facilities to qualified beneficiaries." Said Article provides:
COUNTRYWIDE DEVELOPMENT FUND
For Fund requirements of countrywide
development projects P 2,977,000,000

New Appropriations, by Purpose


Current Operating Expenditures
A. PURPOSE
Personal Maintenance Capital Total
Services and Other Outlays

Operating
Expenses
1. For Countrywide
Developments Projects P250,000,000 P2,727,000,000 P2,977,000,000
TOTAL NEW
APPROPRIATIONS P250,000,000 P2,727,000,000 P2,977,000,000
Special Provisions
1. Use and Release of Funds. The amount herein appropriated shall be used for
infrastructure, purchase of ambulances and computers and other priority projects and
activities, and credit facilities to qualified beneficiaries as proposed and identified by
officials concerned according to the following allocations: Representatives, P12,500,000
each; Senators, P18,000,000 each; Vice-President, P20,000,000; PROVIDED, That, the
said credit facilities shall be constituted as a revolving fund to be administered by a
government financial institution (GFI) as a trust fund for lending operations. Prior years
releases to local government units and national government agencies for this purpose shall
be turned over to the government financial institution which shall be the sole administrator
of credit facilities released from this fund.
The fund shall be automatically released quarterly by way of Advice of Allotments and
Notice of Cash Allocation directly to the assigned implementing agency not later than five
(5) days after the beginning of each quarter upon submission of the list of projects and
activities by the officials concerned.
2. Submission of Quarterly Reports. The Department of Budget and Management shall
submit within thirty (30) days after the end of each quarter a report to the Senate
Committee on Finance and the House Committee on Appropriations on the releases made
from this Fund. The report shall include the listing of the projects, locations, implementing
agencies and the endorsing officials (GAA of 1994, p. 1245).
Petitioners claim that the power given to the members of Congress to propose and identify the projects
and activities to be funded by the Countrywide Development Fund is an encroachment by the legislature
on executive power, since said power in an appropriation act in implementation of a law. They argue that
the proposal and identification of the projects do not involve the making of laws or the repeal and
amendment thereof, the only function given to the Congress by the Constitution (Rollo, pp. 78- 86).
Under the Constitution, the spending power called by James Madison as "the power of the purse," belongs
to Congress, subject only to the veto power of the President. The President may propose the budget, but
still the final say on the matter of appropriations is lodged in the Congress.
The power of appropriation carries with it the power to specify the project or activity to be funded under the
appropriation law. It can be as detailed and as broad as Congress wants it to be.
The Countrywide Development Fund is explicit that it shall be used "for infrastructure, purchase of
ambulances and computers and other priority projects and activities and credit facilities to qualified
beneficiaries . . ." It was Congress itself that determined the purposes for the appropriation.

Executive function under the Countrywide Development Fund involves implementation of the priority
projects specified in the law.
The authority given to the members of Congress is only to propose and identify projects to be implemented
by the President. Under Article XLI of the GAA of 1994, the President must perforce examine whether the
proposals submitted by the members of Congress fall within the specific items of expenditures for which
the Fund was set up, and if qualified, he next determines whether they are in line with other projects
planned for the locality. Thereafter, if the proposed projects qualify for funding under the Funds, it is the
President who shall implement them. In short, the proposals and identifications made by the members of
Congress are merely recommendatory.
The procedure of proposing and identifying by members of Congress of particular projects or activities
under Article XLI of the GAA of 1994 is imaginative as it is innovative.
The Constitution is a framework of a workable government and its interpretation must take into account the
complexities, realities and politics attendant to the operation of the political branches of government. Prior
to the GAA of 1991, there was an uneven allocation of appropriations for the constituents of the members
of Congress, with the members close to the Congressional leadership or who hold cards for "horsetrading," getting more than their less favored colleagues. The members of Congress also had to reckon
with an unsympathetic President, who could exercise his veto power to cancel from the appropriation bill a
pet project of a Representative or Senator.
The Countrywide Development Fund attempts to make equal the unequal. It is also a recognition that
individual members of Congress, far more than the President and their congressional colleagues are likely
to be knowledgeable about the needs of their respective constituents and the priority to be given each
project.
2. Realignment of Operating Expenses
Under the GAA of 1994, the appropriation for the Senate is P472,000,000.00 of which P464,447,000.00 is
appropriated for current operating expenditures, while the appropriation for the House of Representatives
is P1,171,924,000.00 of which P1,165,297,000.00 is appropriated for current operating expenditures (GAA
of 1994, pp. 2, 4, 9, 12).
The 1994 operating expenditures for the Senate are as follows:
Personal Services
Salaries, Permanent 153,347
Salaries/Wage, Contractual/Emergency 6,870

Total Salaries and Wages 160,217


=======
Other Compensation

Step Increments 1,073


Honoraria and Commutable Allowances 3,731
Compensation Insurance Premiums 1,579

Pag-I.B.I.G. Contributions 1,184


Medicare Premiums 888
Bonus and Cash Gift 14,791
Terminal Leave Benefits 2,000
Personnel Economic Relief Allowance 10,266
Additional Compensation of P500 under A.O. 53 11,130
Others 57,173

Total Other Compensation 103,815

01 Total Personal Services 264,032


=======
Maintenance and Other Operating Expenses
02 Traveling Expenses 32,841
03 Communication Services 7,666
04 Repair and Maintenance of Government Facilities 1,220
05 Repair and Maintenance of Government Vehicles 318
06 Transportation Services 128
07 Supplies and Materials 20,189
08 Rents 24,584
14 Water/Illumination and Power 6,561
15 Social Security Benefits and Other Claims 3,270
17 Training and Seminars Expenses 2,225
18 Extraordinary and Miscellaneous Expenses 9,360
23 Advertising and Publication
24 Fidelity Bonds and Insurance Premiums 1,325
29 Other Services 89,778

Total Maintenance and Other Operating Expenditures 200,415

Total Current Operating Expenditures 464,447


=======
(GAA of 1994, pp. 3-4)
The 1994 operating expenditures for the House of Representatives are as follows:
Personal Services
Salaries, Permanent 261,557
Salaries/Wages, Contractual/Emergency 143,643

Total Salaries and Wages 405,200


=======
Other Compensation
Step Increments 4,312
Honoraria and Commutable
Allowances 4,764

Compensation Insurance
Premiums 1,159
Pag-I.B.I.G. Contributions 5,231
Medicare Premiums 2,281
Bonus and Cash Gift 35,669
Terminal Leave Benefits 29
Personnel Economic Relief
Allowance 21,150
Additional Compensation of P500 under A.O. 53
Others 106,140

Total Other Compensation 202,863

01 Total Personal Services 608,063


=======
Maintenance and Other Operating Expenses
02 Traveling Expenses 139,611
03 Communication Services 22,514
04 Repair and Maintenance of Government Facilities 5,116
05 Repair and Maintenance of Government Vehicles 1,863
06 Transportation Services 178
07 Supplies and Materials 55,248
10 Grants/Subsidies/Contributions 940
14 Water/Illumination and Power 14,458
15 Social Security Benefits and Other Claims 325
17 Training and Seminars Expenses 7,236
18 Extraordinary and Miscellaneous Expenses 14,474
20 Anti-Insurgency/Contingency Emergency Expenses 9,400
23 Advertising and Publication 242
24 Fidelity Bonds and Insurance Premiums 1,420
29 Other Services 284,209

Total Maintenance and Other Operating Expenditures 557,234

Total Current Operating Expenditures 1,165,297


=======
(GAA of 1994, pp. 11-12)
The Special Provision Applicable to the Congress of the Philippines provides:
4. Realignment of Allocation for Operational Expenses. A member of Congress may realign
his allocation for operational expenses to any other expenses category provide the total of
said allocation is not exceeded. (GAA of 1994, p. 14).
The appropriation for operating expenditures for each House is further divided into expenditures for
salaries, personal services, other compensation benefits, maintenance expenses and other operating
expenses. In turn, each member of Congress is allotted for his own operating expenditure a proportionate
share of the appropriation for the House to which he belongs. If he does not spend for one items of

expense, the provision in question allows him to transfer his allocation in said item to another item of
expense.
Petitioners assail the special provision allowing a member of Congress to realign his allocation for
operational expenses to any other expense category (Rollo, pp. 82-92), claiming that this practice is
prohibited by Section 25(5), Article VI of the Constitution. Said section provides:
No law shall be passed authorizing any transfer of appropriations: however, the President,
the President of the Senate, the Speaker of the House of Representatives, the Chief
Justice of the Supreme Court, and the heads of Constitutional Commissions may, by law,
be authorized to augment any item in the general appropriations law for their respective
offices from savings in other items of their respective appropriations.
The proviso of said Article of the Constitution grants the President of the Senate and the Speaker of the
House of Representatives the power to augment items in an appropriation act for their respective offices
from savings in other items of their appropriations, whenever there is a law authorizing such augmentation.
The special provision on realignment of the operating expenses of members of Congress is authorized by
Section 16 of the General Provisions of the GAA of 1994, which provides:
Expenditure Components. Except by act of the Congress of the Philippines, no change or
modification shall be made in the expenditure items authorized in this Act and other
appropriation laws unless in cases
of augmentations from savings in appropriations as authorized under Section 25(5) of
Article VI of the Constitution (GAA of 1994, p. 1273).
Petitioners argue that the Senate President and the Speaker of the House of Representatives, but not the
individual members of Congress are the ones authorized to realign the savings as appropriated.
Under the Special Provisions applicable to the Congress of the Philippines, the members of Congress only
determine the necessity of the realignment of the savings in the allotments for their operating expenses.
They are in the best position to do so because they are the ones who know whether there are savings
available in some items and whether there are deficiencies in other items of their operating expenses that
need augmentation. However, it is the Senate President and the Speaker of the House of Representatives,
as the case may be, who shall approve the realignment. Before giving their stamp of approval, these two
officials will have to see to it that:
(1) The funds to be realigned or transferred are actually savings in the items of expenditures from which
the same are to be taken; and
(2) The transfer or realignment is for the purposes of augmenting the items of expenditure to which said
transfer or realignment is to be made.
3. Highest Priority for Debt Service
While Congress appropriated P86,323,438,000.00 for debt service (Article XLVII of the GAA of 1994), it
appropriated only P37,780,450,000.00 for the Department of Education Culture and Sports. Petitioners
urged that Congress cannot give debt service the highest priority in the GAA of 1994 (Rollo, pp. 93-94)
because under the Constitution it should be education that is entitled to the highest funding. They invoke
Section 5(5), Article XIV thereof, which provides:

(5) The State shall assign the highest budgetary priority to education and ensure that
teaching will attract and retain its rightful share of the best available talents through
adequate remuneration and other means of job satisfaction and fulfillment.
This issue was raised in Guingona, Jr. v. Carague, 196 SCRA 221 (1991), where this Court held that
Section 5(5), Article XIV of the Constitution, is merely directory, thus:
While it is true that under Section 5(5), Article XIV of the Constitution, Congress is
mandated to "assign the highest budgetary priority to education" in order to "insure that
teaching will attract and retain its rightful share of the best available talents through
adequate remuneration and other means of job satisfaction and fulfillment," it does not
thereby follow that the hands of Congress are so hamstrung as to deprive it the power to
respond to the imperatives of the national interest and for the attainment of other state
policies or objectives.
As aptly observed by respondents, since 1985, the budget for education has tripled to
upgrade and improve the facility of the public school system. The compensation of
teachers has been doubled. The amount of P29,740,611,000.00 set aside for the
Department of Education, Culture and Sports under the General Appropriations Act (R.A.
No. 6381), is the highest budgetary allocation among all department budgets. This is a
clear compliance with the aforesaid constitutional mandate according highest priority to
education.
Having faithfully complied therewith, Congress is certainly not without any power, guided
only by its good judgment, to provide an appropriation, that can reasonably service our
enormous debt, the greater portion of which was inherited from the previous administration.
It is not only a matter of honor and to protect the credit standing of the country. More
especially, the very survival of our economy is at stake. Thus, if in the process Congress
appropriated an amount for debt service bigger than the share allocated to education, the
Court finds and so holds that said appropriation cannot be thereby assailed as
unconstitutional.
G.R. No. 113105
G.R. No. 113174
Veto of Provision on Debt Ceiling
The Congress added a Special Provision to Article XLVIII (Appropriations for Debt Service) of the GAA of
1994 which provides:
Special Provisions
1. Use of the Fund. The appropriation authorized herein shall be used for payment of
principal and interest of foreign and domestic indebtedness; PROVIDED, That any
payment in excess of the amount herein appropriated shall be subject to the approval of
the President of the Philippines with the concurrence of the Congress of the
Philippines; PROVIDED, FURTHER, That in no case shall this fund be used to pay for the
liabilities of the Central Bank Board of Liquidators.
2. Reporting Requirement. The Bangko Sentral ng Pilipinas and the Department of Finance
shall submit a quarterly report of actual foreign and domestic debt service payments to the

House Committee on Appropriations and Senate Finance Committee within one (1) month
after each quarter (GAA of 1944, pp. 1266).
The President vetoed the first Special Provision, without vetoing the P86,323,438,000.00 appropriation for
debt service in said Article. According to the President's Veto Message:
IV. APPROPRIATIONS FOR DEBT SERVICE
I would like to emphasize that I concur fully with the desire of Congress to reduce the debt
burden by decreasing the appropriation for debt service as well as the inclusion of the
Special Provision quoted below. Nevertheless, I believe that this debt reduction scheme
cannot be validly done through the 1994 GAA. This must be addressed by revising our debt
policy by way of innovative and comprehensive debt reduction programs conceptualized
within the ambit of the Medium-Term Philippine Development Plan.
Appropriations for payment of public debt, whether foreign or domestic, are automatically
appropriated pursuant to the Foreign Borrowing Act and Section 31 of P.D. No. 1177 as
reiterated under Section 26, Chapter 4, Book VI of E.O. No. 292, the Administrative Code
of 1987. I wish to emphasize that the constitutionality of such automatic provisions on debt
servicing has been upheld by the Supreme Court in the case of "Teofisto T. Guingona, Jr.,
and Aquilino Q. Pimentel, Jr. v. Hon. Guillermo N. Carague, in his capacity as Secretary of
Budget and Management, et al.," G.R. No. 94571, dated April 22, 1991.
I am, therefore vetoing the following special provision for the reason that the GAA is not the
appropriate legislative measure to amend the provisions of the Foreign Borrowing Act, P.D.
No. 1177 and E.O. No. 292:
Use of the Fund. The appropriation authorized herein shall be used for
payment of principal and interest of foreign and domestic
indebtedness: PROVIDED, That any payment in excess of the amount
herein appropriated shall be subject to the approval of the President of the
Philippines with the concurrence of the Congress of the
Philippines:PROVIDED, FURTHER, That in no case shall this fund be used
to pay for the liabilities of the Central Bank Board of Liquidators (GAA of
1994, p. 1290).
Petitioners claim that the President cannot veto the Special Provision on the appropriation for debt service
without vetoing the entire amount of P86,323,438.00 for said purpose (Rollo, G.R. No. 113105, pp. 9398; Rollo, G.R. No. 113174, pp. 16-18). The Solicitor General counterposed that the Special Provision did
not relate to the item of appropriation for debt service and could therefore be the subject of an item veto
(Rollo, G.R. No. 113105, pp. 54-60; Rollo, G.R. No. 113174, pp. 72-82).
This issue is a mere rehash of the one put to rest in Gonzales v. Macaraig, Jr., 191 SCRA 452 (1990). In
that case, the issue was stated by the Court, thus:
The fundamental issue raised is whether or not the veto by the President of Section 55 of
the 1989 Appropriations Bill (Section 55
FY '89), and subsequently of its counterpart Section 16 of the 1990 Appropriations Bill
(Section 16 FY '90), is unconstitutional and without effect.
The Court re-stated the issue, just so there would not be any misunderstanding about it, thus:

The focal issue for resolution is whether or not the President exceeded the item-veto power
accorded by the Constitution. Or differently put, has the President the power to veto
"provisions" of an Appropriations Bill?
The bases of the petition in Gonzales, which are similar to those invoked in the present case, are stated as
follows:
In essence, petitioners' cause is anchored on the following grounds: (1) the President's
line-veto power as regards appropriation bills is limited to item/s and does not cover
provision/s; therefore, she exceeded her authority when she vetoed Section 55 (FY '89)
and Section 16 (FY '90) which are provisions; (2) when the President objects to a provision
of an appropriation bill, she cannot exercise the item-veto power but should veto the entire
bill; (3) the item-veto power does not carry with it the power to strike out conditions or
restrictions for that would be legislation, in violation of the doctrine of separation of powers;
and (4) the power of augmentation in Article VI, Section 25 [5] of the 1987 Constitution, has
to be provided for by law and, therefore, Congress is also vested with the prerogative to
impose restrictions on the exercise of that power.
The restrictive interpretation urged by petitioners that the President may not veto a
provision without vetoing the entire bill not only disregards the basic principle that a distinct
and severable part of a bill may be the subject of a separate veto but also overlooks the
Constitutional mandate that any provision in the general appropriations bill shall relate
specifically to some particular appropriation therein and that any such provision shall be
limited in its operation to the appropriation to which it relates (1987 Constitution, Article VI,
Section 25 [2]). In other words, in the true sense of the term, a provision in an
Appropriations Bill is limited in its operation to some particular appropriation to which it
relates, and does not relate to the entire bill.
The Court went one step further and ruled that even assuming arguendo that "provisions" are beyond the
executive power to veto, and Section 55
(FY '89) and Section 16 (FY '90) were not "provisions" in the budgetary sense of the term, they are
"inappropriate provisions" that should be treated as "items" for the purpose of the President's veto power.
The Court, citing Henry v. Edwards, La., 346 So. 2d 153 (1977), said that Congress cannot include in a
general appropriations bill matters that should be more properly enacted in separate legislation, and if it
does that, the inappropriate provisions inserted by it must be treated as "item", which can be vetoed by the
President in the exercise of his item-veto power.
It is readily apparent that the Special Provision applicable to the appropriation for debt service insofar as it
refers to funds in excess of the amount appropriated in the bill, is an "inappropriate" provision referring to
funds other than the P86,323,438,000.00 appropriated in the General Appropriations Act of 1991.
Likewise the vetoed provision is clearly an attempt to repeal Section 31 of P.D. No. 1177 (Foreign
Borrowing Act) and E.O. No. 292, and to reverse the debt payment policy. As held by the Court
in Gonzales, the repeal of these laws should be done in a separate law, not in the appropriations law.
The Court will indulge every intendment in favor of the constitutionality of a veto, the same as it will
presume the constitutionality of an act of Congress (Texas Co. v. State, 254 P. 1060; 31 Ariz, 485, 53
A.L.R. 258 [1927]).
The veto power, while exercisable by the President, is actually a part of the legislative process
(Memorandum of Justice Irene Cortes as Amicus Curiae, pp. 3-7). That is why it is found in Article VI on

the Legislative Department rather than in Article VII on the Executive Department in the Constitution. There
is, therefore, sound basis to indulge in the presumption of validity of a veto. The burden shifts on those
questioning the validity thereof to show that its use is a violation of the Constitution.
Under his general veto power, the President has to veto the entire bill, not merely parts thereof (1987
Constitution, Art. VI, Sec. 27[1]). The exception to the general veto power is the power given to the
President to veto any particular item or items in a general appropriations bill (1987 Constitution, Art. VI,
Sec. 27[2]). In so doing, the President must veto the entire item.
A general appropriations bill is a special type of legislation, whose content is limited to specified sums of
money dedicated to a specific purpose or a separate fiscal unit (Beckman, The Item Veto Power of the
Executive,
31 Temple Law Quarterly 27 [1957]).
The item veto was first introduced by the Organic Act of the Philippines passed by the U.S. Congress on
August 29, 1916. The concept was adopted from some State Constitutions.
Cognizant of the legislative practice of inserting provisions, including conditions, restrictions and limitations,
to items in appropriations bills, the Constitutional Convention added the following sentence to Section
20(2), Article VI of the 1935 Constitution:
. . . When a provision of an appropriation bill affect one or more items of the same, the
President cannot veto the provision without at the same time vetoing the particular item or
items to which it relates . . . .
In short, under the 1935 Constitution, the President was empowered to veto separately not only items in an
appropriations bill but also "provisions".
While the 1987 Constitution did not retain the aforementioned sentence added to Section 11(2) of Article VI
of the 1935 Constitution, it included the following provision:
No provision or enactment shall be embraced in the general appropriations bill unless it
relates specifically to some particular appropriation therein. Any such provision or
enactment shall be limited in its operation to the appropriation to which it relates (Art. VI,
Sec. 25[2]).
In Gonzales, we made it clear that the omission of that sentence of Section 16(2) of the 1935 Constitution
in the 1987 Constitution should not be interpreted to mean the disallowance of the power of the President
to veto a "provision".
As the Constitution is explicit that the provision which Congress can include in an appropriations bill must
"relate specifically to some particular appropriation therein" and "be limited in its operation to the
appropriation to which it relates," it follows that any provision which does not relate to any particular item,
or which extends in its operation beyond an item of appropriation, is considered "an inappropriate
provision" which can be vetoed separately from an item. Also to be included in the category of
"inappropriate provisions" are unconstitutional provisions and provisions which are intended to amend
other laws, because clearly these kind of laws have no place in an appropriations bill. These are matters of
general legislation more appropriately dealt with in separate enactments. Former Justice Irene Cortes,
as Amicus Curiae, commented that Congress cannot by law establish conditions for and regulate the
exercise of powers of the President given by the Constitution for that would be an unconstitutional intrusion
into executive prerogative.

The doctrine of "inappropriate provision" was well elucidated in Henry v. Edwards, supra., thus:
Just as the President may not use his item-veto to usurp constitutional powers conferred on
the legislature, neither can the legislature deprive the Governor of the constitutional powers
conferred on him as chief executive officer of the state by including in a general
appropriation bill matters more properly enacted in separate legislation. The Governor's
constitutional power to veto bills of general legislation . . . cannot be abridged by the careful
placement of such measures in a general appropriation bill, thereby forcing the Governor to
choose between approving unacceptable substantive legislation or vetoing "items" of
expenditures essential to the operation of government.The legislature cannot by location of
a bill give it immunity from executive veto. Nor can it circumvent the Governor's veto power
over substantive legislation by artfully drafting general law measures so that they appear to
be true conditions or limitations on an item of appropriation. Otherwise, the legislature
would be permitted to impair the constitutional responsibilities and functions of a co-equal
branch of government in contravention of the separation of powers doctrine . . . We are no
more willing to allow the legislature to use its appropriation power to infringe on the
Governor's constitutional right to veto matters of substantive legislation than we are to allow
the Governor to encroach on the Constitutional powers of the legislature. In order to avoid
this result, we hold that,when the legislature inserts inappropriate provisions in a general
appropriation bill, such provisions must be treated as "items" for purposes of the
Governor's item veto power over general appropriation bills.
xxx xxx xxx
. . . Legislative control cannot be exercised in such a manner as to encumber the general
appropriation bill with veto-proof "logrolling measures", special interest provisions which
could not succeed if separately enacted, or "riders", substantive pieces of legislation
incorporated in a bill to insure passage without veto . . . (Emphasis supplied).
Petitioners contend that granting arguendo that the veto of the Special Provision on the ceiling for debt
payment is valid, the President cannot automatically appropriate funds for debt payment without complying
with the conditions for automatic appropriation under the provisions of R.A. No. 4860 as amended by P.D.
No. 81 and the provisions of P.D. No. 1177 as amended by the Administrative Code of 1987 and P.D. No.
1967 (Rollo, G.R. No. 113766, pp. 9-15).
Petitioners cannot anticipate that the President will not faithfully execute the laws. The writ of prohibition
will not issue on the fear that official actions will be done in contravention of the laws.
The President vetoed the entire paragraph one of the Special Provision of the item on debt service,
including the provisions that the appropriation authorized in said item "shall be used for payment of the
principal and interest of foreign and domestic indebtedness" and that "in no case shall this fund be used to
pay for the liabilities of the Central Bank Board of Liquidators." These provisions are germane to and have
a direct connection with the item on debt service. Inherent in the power of appropriation is the power to
specify how the money shall be spent (Henry v. Edwards, LA, 346 So., 2d., 153). The said provisos, being
appropriate provisions, cannot be vetoed separately. Hence the item veto of said provisions is void.
We reiterate, in order to obviate any misunderstanding, that we are sustaining the veto of the Special
Provision of the item on debt service only with respect to the proviso therein requiring that "any payment in
excess of the amount herein, appropriated shall be subject to the approval of the President of the
Philippines with the concurrence of the Congress of the Philippines . . ."

G.R. NO. 113174


G.R. NO. 113766
G.R. NO. 11388
1. Veto of provisions for revolving funds of SUC's.
In the appropriation for State Universities and Colleges (SUC's), the President vetoed special provisions
which authorize the use of income and the creation, operation and maintenance of revolving funds. The
Special Provisions vetoed are the following:
(H. 7) West Visayas State University
Equal Sharing of Income. Income earned by the University subject to Section 13 of the
special provisions applicable to all State Universities and Colleges shall be equally shared
by the University and the University Hospital (GAA of 1994, p. 395).
xxx xxx xxx
(J. 3) Leyte State College
Revolving Fund for the Operation of LSC House and Human Resources Development
Center (HRDC). The income of Leyte State College derived from the operation of its LSC
House and HRDC shall be constituted into a Revolving Fund to be deposited in an
authorized government depository bank for the operational expenses of these
projects/services. The net income of the Revolving Fund at the end of the year shall be
remitted to the National Treasury and shall accrue to the General Fund. The implementing
guidelines shall be issued by the Department of Budget and Management (GAA of 1994, p.
415).
The vetoed Special Provisions applicable to all SUC's are the following:
12. Use of Income from Extension Services. State Universities and Colleges are authorized
to use their income from their extension services. Subject to the approval of the Board of
Regents and the approval of a special budget pursuant to Sec. 35, Chapter 5, Book VI of
E.O.
No. 292, such income shall be utilized solely for faculty development, instructional
materials and work study program (GAA of 1994, p. 490).
xxx xxx xxx
13. Income of State Universities and Colleges. The income of State Universities and
Colleges derived from tuition fees and other sources as may be imposed by governing
boards other than those accruing to revolving funds created under LOI Nos. 872 and 1026
and those authorized to be recorded as trust receipts pursuant to Section 40, Chapter 5,
Book VI of E.O. No. 292 shall be deposited with the National Treasury and recorded as a
Special Account in the General Fund pursuant to P.D. No. 1234 and P.D. No. 1437 for the
use of the institution, subject to Section 35, Chapter 5, Book VI of E.O. No.
292L PROVIDED, That disbursements from the Special Account shall not exceed the
amount actually earned and deposited: PROVIDED, FURTHER, That a cash advance on
such income may be allowed State half of income actually realized during the preceding
year and this cash advance shall be charged against income actually earned during the

budget year: AND PROVIDED, FINALLY, That in no case shall such funds be used to
create positions, nor for payment of salaries, wages or allowances, except as may be
specifically approved by the Department of Budge and Management for income-producing
activities, or to purchase equipment or books, without the prior approval of the President of
the Philippines pursuant to Letter of Implementation No. 29.
All collections of the State Universities and Colleges for fees, charges and receipts
intended for private recipient units, including private foundations affiliated with these
institutions shall be duly acknowledged with official receipts and deposited as a trust receipt
before said income shall be subject to Section 35, Chapter 5, Book VI of E.O. No. 292
(GAA of 1994, p. 490).
The President gave his reason for the veto thus:
Pursuant to Section 65 of the Government Auditing Code of the Philippines, Section 44,
Chapter 5, Book VI of E.O. No. 292, s. 1987 and Section 22, Article VII of the Constitution,
all income earned by all Government offices and agencies shall accrue to the General
Fund of the Government in line with the One Fund Policy enunciated by Section 29 (1),
Article VI and Section 22, Article VII of the Constitution. Likewise, the creation and
establishment of revolving funds shall be authorized by substantive law pursuant to Section
66 of the Government Auditing Code of the Philippines and Section 45, Chapter 5, Book VI
of E.O. No. 292.
Notwithstanding the aforementioned provisions of the Constitution and existing law, I have
noted the proliferation of special provisions authorizing the use of agency income as well
as the creation, operation and maintenance of revolving funds.
I would like to underscore the facts that such income were already considered as integral
part of the revenue and financing sources of the National Expenditure Program which I
previously submitted to Congress. Hence, the grant of new special provisions authorizing
the use of agency income and the establishment of revolving funds over and above the
agency appropriations authorized in this Act shall effectively reduce the financing sources
of the 1994 GAA and, at the same time, increase the level of expenditures of some
agencies beyond the well-coordinated, rationalized levels for such agencies. This
corresponding increases the overall deficit of the National Government (Veto Message, p.
3).
Petitioners claim that the President acted with grave abuse of discretion when he disallowed by his veto
the "use of income" and the creation of "revolving fund" by the Western Visayas State University and Leyte
State Colleges when he allowed other government offices, like the National Stud Farm, to use their income
for their operating expenses (Rollo, G.R. No. 113174, pp. 15-16).
There was no undue discrimination when the President vetoed said special provisions while allowing
similar provisions in other government agencies. If some government agencies were allowed to use their
income and maintain a revolving fund for that purpose, it is because these agencies have been enjoying
such privilege before by virtue of the special laws authorizing such practices as exceptions to the "onefund policy" (e.g., R.A. No. 4618 for the National Stud Farm, P.D. No. 902-A for the Securities and
Exchange Commission; E.O. No. 359 for the Department of Budget and Management's Procurement
Service).
2. Veto of provision on 70% (administrative)/30% (contract) ratio for road maintenance.

In the appropriation for the Department of Public Works and Highways, the President vetoed the second
paragraph of Special Provision No. 2, specifying the 30% maximum ration of works to be contracted for the
maintenance of national roads and bridges. The said paragraph reads as follows:
2. Release and Use of Road Maintenance Funds. Funds allotted for the maintenance and
repair of roads which are provided in this Act for the Department of Public Works and
Highways shall be released to the respective Engineering District, subject to such rules and
regulations as may be prescribed by the Department of Budget and Management.
Maintenance funds for roads and bridges shall be exempt from budgetary reserve.
Of the amount herein appropriated for the maintenance of national roads and bridges, a
maximum of thirty percent (30%) shall be contracted out in accordance with guidelines to
be issued by the Department of Public Works and Highways. The balance shall be used for
maintenance by force account.
Five percent (5%) of the total road maintenance fund appropriated herein to be applied
across the board to the allocation of each region shall be set aside for the maintenance of
roads which may be converted to or taken over as national roads during the current year
and the same shall be released to the central office of the said department for eventual
sub-allotment to the concerned region and district: PROVIDED, That any balance of the
said five percent (5%) shall be restored to the regions on a pro-rata basis for the
maintenance of existing national roads.
No retention or deduction as reserves or overhead expenses shall be made, except as
authorized by law or upon direction of the President
(GAA of 1994, pp. 785-786; Emphasis supplied).
The President gave the following reason for the veto:
While I am cognizant of the well-intended desire of Congress to impose certain restrictions
contained in some special provisions, I am equally aware that many programs, projects and
activities of agencies would require some degree of flexibility to ensure their successful
implementation and therefore risk their completion. Furthermore, not only could these
restrictions and limitations derail and impede program implementation but they may also
result in a breach of contractual obligations.
D.1.a. A study conducted by the Infrastructure Agencies show that for practical intent and
purposes, maintenance by contract could be undertaken to an optimum of seventy percent
(70%) and the remaining thirty percent (30%) by force account. Moreover, the policy of
maximizing implementation through contract maintenance is a covenant of the Road and
Road Transport Program Loan from the Asian Development Bank (ADB Loan No. 1047PHI-1990) and Overseas Economic Cooperation Fund (OECF Loan No. PH-C17-199). The
same is a covenant under the World Bank (IBRD) Loan for the Highway Management
Project (IBRD Loan
No. PH-3430) obtained in 1992.
In the light of the foregoing and considering the policy of the government to encourage and
maximize private sector participation in the regular repair and maintenance of infrastructure
facilities, I am directly vetoing the underlined second paragraph of Special Provision No. 2
of the Department of Public Works and Highways (Veto Message, p. 11).

The second paragraph of Special Provision No. 2 brings to fore the divergence in policy of Congress and
the President. While Congress expressly laid down the condition that only 30% of the total appropriation for
road maintenance should be contracted out, the President, on the basis of a comprehensive study,
believed that contracting out road maintenance projects at an option of 70% would be more efficient,
economical and practical.
The Special Provision in question is not an inappropriate provision which can be the subject of a veto. It is
not alien to the appropriation for road maintenance, and on the other hand, it specified how the said item
shall be expended 70% by administrative and 30% by contract.
The 1987 Constitution allows the addition by Congress of special provisions, conditions to items in an
expenditure bill, which cannot be vetoed separately from the items to which they relate so long as they are
"appropriate" in the budgetary sense (Art. VII, Sec. 25[2]).
The Solicitor General was hard put in justifying the veto of this special provision. He merely argued that the
provision is a complete turnabout from an entrenched practice of the government to maximize contract
maintenance (Rollo, G.R. No. 113888, pp. 85-86). That is not a ground to veto a provision separate from
the item to which it refers.
The veto of the second paragraph of Special Provision No. 2 of the item for the DPWH is therefore
unconstitutional.
3. Veto of provision on purchase of medicines by AFP.
In the appropriation for the Armed Forces of the Philippines (AFP), the President vetoed the special
provision on the purchase by the AFP of medicines in compliance with the Generics Drugs Law (R.A. No.
6675). The vetoed provision reads:
12. Purchase of Medicines. The purchase of medicines by all Armed Forces of the
Philippines units, hospitals and clinics shall strictly comply with the formulary embodied in
the National Drug Policy of the Department of Health (GAA of 1994, p. 748).
According to the President, while it is desirable to subject the purchase of medicines to a standard
formulary, "it is believed more prudent to provide for a transition period for its adoption and smooth
implementation in the Armed Forces of the Philippines" (Veto Message, p. 12).
The Special Provision which requires that all purchases of medicines by the AFP should strictly comply
with the formulary embodied in the National Drug Policy of the Department of Health is an "appropriate"
provision. it is a mere advertence by Congress to the fact that there is an existing law, the Generics Act of
1988, that requires "the extensive use of drugs with generic names through a rational system of
procurement and distribution." The President believes that it is more prudent to provide for a transition
period for the smooth implementation of the law in the case of purchases by the Armed Forces of the
Philippines, as implied by Section 11 (Education Drive) of the law itself. This belief, however, cannot justify
his veto of the provision on the purchase of medicines by the AFP.
Being directly related to and inseparable from the appropriation item on purchases of medicines by the
AFP, the special provision cannot be vetoed by the President without also vetoing the said item (Bolinao
Electronics Corporation v. Valencia, 11 SCRA 486 [1964]).
4. Veto of provision on prior approval of Congress for purchase of military equipment.

In the appropriation for the modernization of the AFP, the President vetoed the underlined proviso of
Special Provision No. 2 on the "Use of Fund," which requires the prior approval of Congress for the release
of the corresponding modernization funds, as well as the entire Special Provisions
No. 3 on the "Specific Prohibition":
2. Use of the Fund. Of the amount herein appropriated, priority shall be given for the
acquisition of AFP assets necessary for protecting marine, mineral, forest and other
resources within Philippine territorial borders and its economic zone, detection, prevention
or deterrence of air or surface intrusions and to support diplomatic moves aimed at
preserving national dignity, sovereignty and patrimony: PROVIDED, That the said
modernization fund shall not be released until a Table of Organization and Equipment for
FY 1994-2000 is submitted to and approved by Congress.
3. Specific Prohibition. The said Modernization Fund shall not be used for payment of six
(6) additional S-211 Trainer planes, 18 SF-260 Trainer planes and 150 armored personnel
carriers (GAA of 1994, p. 747).
As reason for the veto, the President stated that the said condition and prohibition violate the Constitutional
mandate of non-impairment of contractual obligations, and if allowed, "shall effectively alter the original
intent of the AFP Modernization Fund to cover all military equipment deemed necessary to modernize the
Armed Forces of the Philippines" (Veto Message, p. 12).
Petitioners claim that Special Provision No. 2 on the "Use of Fund" and Special Provision No. 3 are
conditions or limitations related to the item on the AFP modernization plan.
The requirement in Special Provision No. 2 on the "Use of Fund" for the AFP modernization program that
the President must submit all purchases of military equipment to Congress for its approval, is an exercise
of the "congressional or legislative veto." By way of definition, a congressional veto is a means whereby
the legislature can block or modify administrative action taken under a statute. It is a form of legislative
control in the implementation of particular executive actions. The form may be either negative, that is
requiring disapproval of the executive action, or affirmative, requiring approval of the executive action. This
device represents a significant attempt by Congress to move from oversight of the executive to shared
administration (Dixon, The Congressional Veto and Separation of Powers: The Executive on a Leash,
56 North Carolina Law Review, 423 [1978]).
A congressional veto is subject to serious questions involving the principle of separation of powers.
However the case at bench is not the proper occasion to resolve the issues of the validity of the legislative
veto as provided in Special Provisions Nos. 2 and 3 because the issues at hand can be disposed of on
other grounds. Any provision blocking an administrative action in implementing a law or requiring
legislative approval of executive acts must be incorporated in a separate and substantive bill. Therefore,
being "inappropriate" provisions, Special Provisions Nos. 2 and 3 were properly vetoed.
As commented by Justice Irene Cortes in her memorandum as Amicus Curiae: "What Congress cannot do
directly by law it cannot do indirectly by attaching conditions to the exercise of that power (of the President
as Commander-in-Chief) through provisions in the appropriation law."
Furthermore, Special Provision No. 3, prohibiting the use of the Modernization Funds for payment of the
trainer planes and armored personnel carriers, which have been contracted for by the AFP, is violative of
the Constitutional prohibition on the passage of laws that impair the obligation of contracts (Art. III, Sec.
10), more so, contracts entered into by the Government itself.

The veto of said special provision is therefore valid.


5. Veto of provision on use of savings to augment AFP pension funds.
In the appropriation for the AFP Pension and Gratuity Fund, the President vetoed the new provision
authorizing the Chief of Staff to use savings in the AFP to augment pension and gratuity funds. The vetoed
provision reads:
2. Use of Savings. The Chief of Staff, AFP, is authorized, subject to the approval of the
Secretary of National Defense, to use savings in the appropriations provided herein to
augment the pension fund being managed by the AFP Retirement and Separation Benefits
System as provided under Sections 2(a) and 3 of P.D. No. 361 (GAA of 1994,
p. 746).
According to the President, the grant of retirement and separation benefits should be covered by direct
appropriations specifically approved for the purpose pursuant to Section 29(1) of Article VI of the
Constitution. Moreover, he stated that the authority to use savings is lodged in the officials enumerated in
Section 25(5) of Article VI of the Constitution (Veto Message, pp. 7-8).
Petitioners claim that the Special Provision on AFP Pension and Gratuity Fund is a condition or limitation
which is so intertwined with the item of appropriation that it could not be separated therefrom.
The Special Provision, which allows the Chief of Staff to use savings to augment the pension fund for the
AFP being managed by the AFP Retirement and Separation Benefits System is violative of Sections 25(5)
and 29(1) of the Article VI of the Constitution.
Under Section 25(5), no law shall be passed authorizing any transfer of appropriations, and under Section
29(1), no money shall be paid out of
the Treasury except in pursuance of an appropriation made by law. While Section 25(5) allows as an
exception the realignment of savings to augment items in the general appropriations law for the executive
branch, such right must and can be exercised only by the President pursuant to a specific law.
6. Condition on the deactivation of the CAFGU's.
Congress appropriated compensation for the CAFGU's, including the payment of separation benefits but it
added the following Special Provision:
1. CAFGU Compensation and Separation Benefit. The appropriation authorized herein
shall be used for the compensation of CAFGU's including the payment of their separation
benefit not exceeding one (1) year subsistence allowance for the 11,000 members who will
be deactivated in 1994. The Chief of Staff, AFP, shall, subject to the approval of the
Secretary of National Defense, promulgate policies and procedures for the payment of
separation benefit (GAA of 1994, p. 740).
The President declared in his Veto Message that the implementation of this Special Provision to the item
on the CAFGU's shall be subject to prior Presidential approval pursuant to P.D. No. 1597 and R.A.. No.
6758. He gave the following reasons for imposing the condition:
I am well cognizant of the laudable intention of Congress in proposing the amendment of
Special Provision No. 1 of the CAFGU. However, it is premature at this point in time of our
peace process to earmark and declare through special provision the actual number of

CAFGU members to be deactivated in CY 1994. I understand that the number to be


deactivated would largely depend on the result or degree of success of the on-going peace
initiatives which are not yet precisely determinable today. I have desisted, therefore, to
directly veto said provisions because this would mean the loss of the entire special
provision to the prejudice of its beneficient provisions. I therefore declare that the actual
implementation of this special provision shall be subject to prior Presidential approval
pursuant to the provisions of P.D. No. 1597 and
R.A. No. 6758 (Veto Message, p. 13).
Petitioners claim that the Congress has required the deactivation of the CAFGU's when it appropriated the
money for payment of the separation pay of the members of thereof. The President, however, directed that
the deactivation should be done in accordance to his timetable, taking into consideration the peace and
order situation in the affected localities.
Petitioners complain that the directive of the President was tantamount to an administrative embargo of the
congressional will to implement the Constitution's command to dissolve the CAFGU's (Rollo, G.R. No.
113174,
p. 14; G.R. No. 113888, pp. 9, 14-16). They argue that the President cannot impair or withhold
expenditures authorized and appropriated by Congress when neither the Appropriations Act nor other
legislation authorize such impounding (Rollo, G.R. No. 113888, pp. 15-16).
The Solicitor General contends that it is the President, as Commander-in-Chief of the Armed Forces of the
Philippines, who should determine when the services of the CAFGU's are no longer needed (Rollo, G.R.
No. 113888,
pp. 92-95.).
This is the first case before this Court where the power of the President to impound is put in issue.
Impoundment refers to a refusal by the President, for whatever reason, to spend funds made available by
Congress. It is the failure to spend or obligate budget authority of any type (Notes: Impoundment of
Funds, 86 Harvard Law Review 1505 [1973]).
Those who deny to the President the power to impound argue that once Congress has set aside the fund
for a specific purpose in an appropriations act, it becomes mandatory on the part of the President to
implement the project and to spend the money appropriated therefor. The President has no discretion on
the matter, for the Constitution imposes on him the duty to faithfully execute the laws.
In refusing or deferring the implementation of an appropriation item, the President in effect exercises a veto
power that is not expressly granted by the Constitution. As a matter of fact, the Constitution does not say
anything about impounding. The source of the Executive authority must be found elsewhere.
Proponents of impoundment have invoked at least three principal sources of the authority of the President.
Foremost is the authority to impound given to him either expressly or impliedly by Congress. Second is the
executive power drawn from the President's role as Commander-in-Chief. Third is the Faithful Execution
Clause which ironically is the same provision invoked by petitioners herein.
The proponents insist that a faithful execution of the laws requires that the President desist from
implementing the law if doing so would prejudice public interest. An example given is when through
efficient and prudent management of a project, substantial savings are made. In such a case, it is sheer
folly to expect the President to spend the entire amount budgeted in the law (Notes: Presidential
Impoundment: Constitutional Theories and Political Realities, 61 Georgetown Law Journal 1295 [1973];
Notes; Protecting the Fisc: Executive Impoundment and Congressional Power, 82 Yale Law Journal 1686
[1973).

We do not find anything in the language used in the challenged Special Provision that would imply that
Congress intended to deny to the President the right to defer or reduce the spending, much less to
deactivate 11,000 CAFGU members all at once in 1994. But even if such is the intention, the appropriation
law is not the proper vehicle for such purpose. Such intention must be embodied and manifested in
another law considering that it abrades the powers of the Commander-in-Chief and there are existing laws
on the creation of the CAFGU's to be amended. Again we state: a provision in an appropriations act
cannot
be used to repeal or amend other laws, in this case, P.D. No. 1597 and R.A. No. 6758.
7. Condition on the appropriation for the Supreme Court, etc.
(a) In the appropriations for the Supreme Court, Ombudsman, COA, and CHR, the Congress added the
following provisions:
The Judiciary
xxx xxx xxx
Special Provisions
1. Augmentation of any Item in the Court's Appropriations. Any savings in the
appropriations for the Supreme Court and the Lower Courts may be utilized by the Chief
Justice of the Supreme Court to augment any item of the Court's appropriations for (a)
printing of decisions and publication of "Philippine Reports"; (b) Commutable terminal
leaves of Justices and other personnel of the Supreme Court and payment of adjusted
pension rates to retired Justices entitled thereto pursuant to Administrative Matter No. 91-8225-C.A.; (c) repair, maintenance, improvement and other operating expenses of the
courts' libraries, including purchase of books and periodicals; (d) purchase, maintenance
and improvement of printing equipment; (e) necessary expenses for the employment of
temporary employees, contractual and casual employees, for judicial administration; (f)
maintenance and improvement of the Court's Electronic Data
Processing System; (g) extraordinary expenses of the Chief Justice, attendance in
international conferences and conduct of training programs; (h) commutable transportation
and representation allowances and fringe benefits for Justices, Clerks of Court, Court
Administrator, Chiefs of Offices and other Court personnel in accordance with the rates
prescribed by law; and (i) compensation of attorney-de-officio: PROVIDED, That as
mandated by LOI No. 489 any increase in salary and allowances shall be subject to the
usual procedures and policies as provided for under
P.D. No. 985 and other pertinent laws (GAA of 1994, p. 1128; Emphasis supplied).
xxx xxx xxx
Commission on Audit
xxx xxx xxx
5. Use of Savings. The Chairman of the Commission on Audit is hereby authorized, subject
to appropriate accounting and auditing rules and regulations, to use savings for the
payment of fringe benefits as may be authorized by law for officials and personnel of the
Commission (GAA of 1994, p. 1161; Emphasis supplied).

xxx xxx xxx


Office of the Ombudsman
xxx xxx xxx
6. Augmentation of Items in the appropriation of the Office of the Ombudsman. The
Ombudsman is hereby authorized, subject to appropriate accounting and auditing rules and
regulations to augment items of appropriation in the Office of the Ombudsman from savings
in other items of appropriation actually released, for: (a) printing and/or publication of
decisions, resolutions, training and information materials; (b) repair, maintenance and
improvement of OMB Central and Area/Sectoral facilities; (c) purchase of books, journals,
periodicals and equipment;
(d) payment of commutable representation and transportation allowances of officials and
employees who by reason of their positions are entitled thereto and fringe benefits as may
be authorized specifically by law for officials and personnel of OMB pursuant to Section 8 of
Article IX-B of the Constitution; and (e) for other official purposes subject to accounting and
auditing rules and regulations (GAA of 1994, p. 1174; Emphasis supplied).
xxx xxx xxx
Commission on Human Rights
xxx xxx xxx
1. Use of Savings. The Chairman of the Commission on Human Rights (CHR) is hereby
authorized, subject to appropriate accounting and auditing rules and regulations, to
augment any item of appropriation in the office of the CHR from savings in other items of
appropriations actually released, for: (a) printing and/or publication of decisions,
resolutions, training materials and educational publications; (b) repair, maintenance and
improvement of Commission's central and regional facilities; (c) purchase of books,
journals, periodicals and equipment, (d) payment of commutable representation and
transportation allowances of officials and employees who by reason of their positions are
entitled thereto and fringe benefits, as may be authorized by law for officials and personnel
of CHR, subject to accounting and auditing rules and regulations (GAA of 1994, p. 1178;
Emphasis supplied).
In his Veto Message, the President expressed his approval of the conditions included in the GAA of 1994.
He noted that:
The said condition is consistent with the Constitutional injunction prescribed under Section
8, Article IX-B of the Constitution which states that "no elective or appointive public officer
or employee shall receive additional, double, or indirect compensation unless specifically
authorized by law." I am, therefore, confident that the heads of the said offices shall
maintain fidelity to the law and faithfully adhere to the well-established principle on
compensation standardization (Veto Message, p. 10).
Petitioners claim that the conditions imposed by the President violated the independence and fiscal
autonomy of the Supreme Court, the Ombudsman, the COA and the CHR.

In the first place, the conditions questioned by petitioners were placed in the GAB by Congress itself, not
by the President. The Veto Message merely highlighted the Constitutional mandate that additional or
indirect compensation can only be given pursuant to law.
In the second place, such statements are mere reminders that the disbursements of appropriations must
be made in accordance with law. Such statements may, at worse, be treated as superfluities.
(b) In the appropriation for the COA, the President imposed the condition that the implementation of the
budget of the COA be subject to "the guidelines to be issued by the President."
The provisions subject to said condition reads:
xxx xxx xxx
3. Revolving Fund. The income of the Commission on Audit derived from sources
authorized by the Government Auditing Code of the Philippines (P.D. No. 1445) not
exceeding Ten Million Pesos (P10,000,000) shall be constituted into a revolving fund which
shall be used for maintenance, operating and other incidental expenses to enhance audit
services and audit-related activities. The fund shall be deposited in an authorized
government depository ban, and withdrawals therefrom shall be made in accordance with
the procedure prescribed by law and implementing rules and regulations: PROVIDED, That
any interests earned on such deposit shall be remitted at the end of each quarter to the
national Treasury and shall accrue to the General Fund: PROVIDED FURTHER,That the
Commission on Audit shall submit to the Department of Budget and Management a
quarterly report of income and expenditures of said revolving fund (GAA of 1994, pp. 11601161).
The President cited the "imperative need to rationalize" the implementation, applicability and operation of
use of income and revolving funds. The Veto Message stated:
. . . I have observed that there are old and long existing special provisions authorizing the
use of income and the creation of revolving funds. As a rule, such authorizations should be
discouraged. However, I take it that these authorizations have legal/statutory basis aside
from being already a vested right to the agencies concerned which should not be
jeopardized through the Veto Message. There is, however, imperative need to rationalize
their implementation, applicability and operation. Thus, in order to substantiate the purpose
and intention of said provisions, I hereby declare that the operationalization of the following
provisions during budget implementation shall be subject to theguidelines to be issued by
the President pursuant to Section 35, Chapter 5, Book VI of E.O. No. 292 and Sections 65
and 66 of P.D. No. 1445 in relation to Sections 2 and 3 of the General Provisions of this Act
(Veto Message, p. 6; Emphasis Supplied.)
(c) In the appropriation for the DPWH, the President imposed the condition that in the implementation of
DPWH projects, the administrative and engineering overhead of 5% and 3% "shall be subject to the
necessary administrative guidelines to be formulated by the Executive pursuant to existing laws." The
condition was imposed because the provision "needs further study" according to the President.
The following provision was made subject to said condition:
9. Engineering and Administrative Overhead. Not more than five percent (5%) of the
amount for infrastructure project released by the Department of Budget and Management

shall be deducted by DPWH for administrative overhead, detailed engineering and


construction supervision, testing and quality control, and the like, thus insuring that at least
ninety-five percent (95%) of the released fund is available for direct implementation of the
project. PROVIDED, HOWEVER, That for school buildings, health centers, day-care
centers and barangay halls, the deductible amount shall not exceed three percent (3%).
Violation of, or non-compliance with, this provision shall subject the government official or
employee concerned to administrative, civil and/or criminal sanction under Sections 43 and
80, Book VI of E.O.
No. 292 (GAA of 1994, p. 786).
(d) In the appropriation for the National Housing Authority (NHA), the President imposed the condition that
allocations for specific projects shall be released and disbursed "in accordance with the housing program
of the government, subject to prior Executive approval."
The provision subject to the said condition reads:
3. Allocations for Specified Projects. The following allocations for the specified projects
shall be set aside for corollary works and used exclusively for the repair, rehabilitation and
construction of buildings, roads, pathwalks, drainage, waterworks systems, facilities and
amenities in the area:PROVIDED, That any road to be constructed or rehabilitated shall
conform with the specifications and standards set by the Department of Public Works and
Highways for such kind of road:PROVIDED, FURTHER, That savings that may be available
in the future shall be used for road repair, rehabilitation and construction:
(1) Maharlika Village Road Not less than P5,000,000
(2) Tenement Housing Project (Taguig) Not less than
P3,000,000
(3) Bagong Lipunan Condominium Project (Taguig) Not
less than P2,000,000
4. Allocation of Funds. Out of the amount appropriated for the implementation of various
projects in resettlement areas, Seven Million Five Hundred Thousand Pesos (P7,500,000)
shall be allocated to the Dasmarias Bagong Bayan resettlement area, Eighteen Million
Pesos (P18,000,000) to the Carmona Relocation Center Area (Gen. Mariano Alvarez) and
Three Million Pesos (P3,000,000) to the Bulihan Sites and Services, all of which will be for
the cementing of roads in accordance with DPWH standards.
5. Allocation for Sapang Palay. An allocation of Eight Million Pesos (P8,000,000) shall be
set aside for the asphalting of seven (7) kilometer main road of Sapang Palay, San Jose
Del Monte, Bulacan
(GAA of 1994, p. 1216).
The President imposed the conditions: (a) that the "operationalization" of the special provision on revolving
funds of the COA "shall be subject to guidelines to be issued by the President pursuant to Section 35,
Chapter 5,
Book VI of E.O. 292 and Sections 65 and 66 of P.D. No. 1445 in relation to Sections 2 and 3 of the General
Provisions of this Act" (Rollo, G.R.
No. 113174, pp. 5,7-8); (b) that the implementation of Special Provision No. 9 of the DPWH on the

mandatory retention of 5% and 3% of the amounts released by said Department "be subject to the
necessary administrative guidelines to be formulated by the Executive pursuant to existing law" (Rollo,
G.R. No. 113888; pp. 10, 14-16); and (c) that the appropriations authorized for the NHA can be released
only "in accordance with the housing program of the government subject to prior Executive approval"
(Rollo, G.R. No. 113888, pp. 10-11;
14-16).
The conditions objected to by petitioners are mere reminders that the implementation of the items on which
the said conditions were imposed, should be done in accordance with existing laws, regulations or policies.
They did not add anything to what was already in place at the time of the approval of the GAA of 1994.
There is less basis to complain when the President said that the expenditures shall be subject to guidelines
he will issue. Until the guidelines are issued, it cannot be determined whether they are proper or
inappropriate. The issuance of administrative guidelines on the use of public funds authorized by Congress
is simply an exercise by the President of his constitutional duty to see that the laws are faithfully executed
(1987 Constitution, Art. VII, Sec. 17; Planas v. Gil 67 Phil. 62 [1939]). Under the Faithful Execution Clause,
the President has the power to take "necessary and proper steps" to carry into execution the law
(Schwartz, On Constitutional Law, p. 147 [1977]). These steps are the ones to be embodied in the
guidelines.
IV
Petitioners chose to avail of the special civil actions but those remedies can be used only when
respondents have acted "without or in excess" of jurisdiction, or "with grave abuse of discretion," (Revised
Rules of Court,
Rule 65, Section 2). How can we begrudge the President for vetoing the Special Provision on the
appropriation for debt payment when he merely followed our decision in Gonzales? How can we say that
Congress has abused its discretion when it appropriated a bigger sum for debt payment than the amount
appropriated for education, when it merely followed our dictum in Guingona?
Article 8 of the Civil Code of Philippines, provides:
Judicial decisions applying or interpreting the laws or the constitution shall from a part of
the legal system of the Philippines.
The Court's interpretation of the law is part of that law as of the date of its enactment since the court's
interpretation merely establishes the contemporary legislative intent that the construed law purports to
carry into effect (People v. Licera, 65 SCRA 270 [1975]). Decisions of the Supreme Court assume the
same authority as statutes (Floresca v. Philex Mining Corporation, 136 SCRA 141 [1985]).
Even if Guingona and Gonzales are considered hard cases that make bad laws and should be reversed,
such reversal cannot nullify prior acts done in reliance thereof.
WHEREFORE, the petitions are DISMISSED, except with respect to
(1) G.R. Nos. 113105 and 113766 only insofar as they pray for the annulment of the veto of the special
provision on debt service specifying that the fund therein appropriated "shall be used for payment of the
principal and interest of foreign and domestic indebtedness" prohibiting the use of the said funds "to pay
for the liabilities of the Central Bank Board of Liquidators", and (2) G.R. No. 113888 only insofar as it prays
for the annulment of the veto of: (a) the second paragraph of Special Provision No. 2 of the item of
appropriation for the Department of Public Works and Highways (GAA of 1994, pp. 785-786); and (b)
Special Provision No. 12 on the purchase of medicines by the Armed Forces of the Philippines (GAA of
1994, p. 748), which is GRANTED.

SO ORDERED.
Narvasa, C.J., Feliciano, Bidin, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Kapunan
and Mendoza, JJ., concur.

Separate Opinions

PADILLA, J., concurring and dissenting:


I concur with the ponencia of Mr. Justice Camilo D. Quiason except in so far as it re-affirms the Court's
decision inGonzalez v. Macaraig (191 SCRA 452).
Sec. 27(2), Art. VI of the Constitution states:
The President shall have the power to veto any particular item or items in an appropriation,
revenue, or tariff bill, but the veto shall not effect the item or items to which he does not
object.
In my dissenting opinion in Gonzalez, I stated that:
The majority opinion positions the veto questioned in this case within the scope of Section
27(2) [Article VI of the Constitution]. I do not see how this can be done without doing
violence to the constitutional design. The distinction between an item-veto and a provision
veto has been traditionally recognized in constitutional litigation and budgetary practice. As
stated by Mr. Justice Sutherland, speaking for the U.S. Supreme Court in Bengzon
v. Secretary of Justice, 299 U.S. 410-416:
. . . An item of an appropriation bill obviously means an item which in itself
is a specific appropriation of money, not some general provisions of law
which happens to be put into an appropriation bill . . .
When the Constitution in Section 27(2) empowers the President to veto any particular item
or items in the appropriation act, it does not
confer in fact, it excludes the power to veto any particular provision or provisions in
said act.
In an earlier case, Sarmiento v. Mison, et al., 156 SCRA 549, this court referred to its duty
to construe the Constitution, not in accordance with how the executive or the legislative
would want it construed, but in accordance with what it says and provides. When the
Constitution states that the President has the power to veto any particular item or items in
the appropriation act, this must be taken as a component of that delicate balance of power
between the executive and legislative, so that, for this Court to construe Sec. 27(2) of the
Constitution as also empowering the President to veto any particular provision or provisions
in the appropriations act, is to load the scale in favor of the executive, at the expense of
that delicate balance of power.

I therefore disagree with the majority's pronouncements which would validate the veto by the President of
specific provisions in the appropriations act based on the contention that such are "inappropriate
provisions." Even assuming, for the sake of argument, that a provision in the appropriations act is
"inappropriate" from the Presidential standpoint, it is still a provision, not an item, in an appropriations act
and, therefore, outside the veto power of the Executive.
VITUG, J., concurring:
I concur on the points so well expounded by a most respected colleague, Mr. Justice Camilo D. Quiason. I
should like to highlight a bit, however, that part of the ponencia dealing on the Countrywide Development
Fund or, so commonly referred to as, the infamous "pork barrel".
I agree that it lies with Congress to determine in an appropriation act the activities and the projects that are
desirable and may thus be funded. Once, however, such identification and the corresponding appropriation
therefore is done, the legislative act is completed and it ends there. Thereafter, the Executive is behooved,
with exclusive responsibility and authority, to see to it that the legislative will is properly carried out. I
cannot subscribe to another theory invoked by some quarters that, in so implementing the law, the
Executive does so only by way of delegation. Congress neither may delegate what it does not have nor
may encroach on the powers of a co-equal, independent and coordinate branch.
Within its own sphere, Congress acts as a body, not as the individuals that comprise it, in any action or
decision that can bind it, or be said to have been done by it, under its constitutional authority. Even
assuming that overseeing the laws it enacts continues to be a legislative process, one that I find difficult to
accept, it is Congress itself, not any of its members, that must exercise that function.
I cannot debate the fact that the members of Congress, more than the President and his colleagues, would
have the best feel on the needs of their own respective cosntituents. I see no legal obstacle, however, in
their making, just like anyone else, the proper recommendations to albeit not necessarily conclusive on,
the President for the purpose. Neother would it be objectionable for Congrss, by law, to appropriate funds
for specific projects as it may be minded; to give that authoriy, however, to the individual members of
Congress in whatever guise, I am afraid, would be constitutionality impermissible.

# Separate Opinions

PADILLA, J., concurring and dissenting:


I concur with the ponencia of Mr. Justice Camilo D. Quiason except in so far as it re-affirms the Court's
decision inGonzalez v. Macaraig (191 SCRA 452).
Sec. 27(2), Art. VI of the Constitution states:
The President shall have the power to veto any particular item or items in an appropriation,
revenue, or tariff bill, but the veto shall not effect the item or items to which he does not
object.
In my dissenting opinion in Gonzalez, I stated that:
The majority opinion positions the veto questioned in this case within the scope of Section
27(2) [Article VI of the Constitution]. I do not see how this can be done without doing

violence to the constitutional design. The distinction between an item-veto and a provision
veto has been traditionally recognized in constitutional litigation and budgetary practice. As
stated by Mr. Justice Sutherland, speaking for the U.S. Supreme Court in Bengzon
v. Secretary of Justice, 299 U.S. 410-416:
. . . An item of an appropriation bill obviously means an item which in itself
is a specific appropriation of money, not some general provisions of law
which happens to be put into an appropriation bill . . .
When the Constitution in Section 27(2) empowers the President to veto any particular item
or items in the appropriation act, it does not
confer in fact, it excludes the power to veto any particular provision or provisions in
said act.
In an earlier case, Sarmiento v. Mison, et al., 156 SCRA 549, this court referred to its duty
to construe the Constitution, not in accordance with how the executive or the legislative
would want it construed, but in accordance with what it says and provides. When the
Constitution states that the President has the power to veto any particular item or items in
the appropriation act, this must be taken as a component of that delicate balance of power
between the executive and legislative, so that, for this Court to construe Sec. 27(2) of the
Constitution as also empowering the President to veto any particular provision or provisions
in the appropriations act, is to load the scale in favor of the executive, at the expense of
that delicate balance of power.
I therefore disagree with the majority's pronouncements which would validate the veto by the President of
specific provisions in the appropriations act based on the contention that such are "inappropriate
provisions." Even assuming, for the sake of argument, that a provision in the appropriations act is
"inappropriate" from the Presidential standpoint, it is still a provision, not an item, in an appropriations act
and, therefore, outside the veto power of the Executive.
VITUG, J., concurring:
I concur on the points so well expounded by a most respected colleague, Mr. Justice Camilo D. Quiason. I
should like to highlight a bit, however, that part of the ponencia dealing on the Countrywide Development
Fund or, so commonly referred to as, the infamous "pork barrel".
I agree that it lies with Congress to determine in an appropriation act the activities and the projects that are
desirable and may thus be funded. Once, however, such identification and the corresponding appropriation
therefore is done, the legislative act is completed and it ends there. Thereafter, the Executive is behooved,
with exclusive responsibility and authority, to see to it that the legislative will is properly carried out. I
cannot subscribe to another theory invoked by some quarters that, in so implementing the law, the
Executive does so only by way of delegation. Congress neither may delegate what it does not have nor
may encroach on the powers of a co-equal, independent and coordinate branch.
Within its own sphere, Congress acts as a body, not as the individuals that comprise it, in any action or
decision that can bind it, or be said to have been done by it, under its constitutional authority. Even
assuming that overseeing the laws it enacts continues to be a legislative process, one that I find difficult to
accept, it is Congress itself, not any of its members, that must exercise that function.
I cannot debate the fact that the members of Congress, more than the President and his colleagues, would
have the best feel on the needs of their own respective constituents. I see no legal obstacle, however, in
their making, just like anyone else, the proper recommendations to, albeit not necessarily conclusive on,

the President for the purpose. Neither would it be objectionable for Congress, by law, to appropriate funds
for such specific projects as it may be minded; to give that authority, however, to the individual members of
Congress in whatever guise, I am afraid, would be constitutionally impermissible.

EN BANC

[G.R. No. 150732. August 31, 2004]

TOMAS G. VELASQUEZ, Officer-In-Charge, Office of the School


Superintendent, DECS Division of Abra; MARIETTA BERSALONA,
Chairperson, DECS Fact Finding Committee; EDUARDO RUPERTO,
JOAQUIN PILIEN and LUZ CURBI, Members, DECS Fact Finding
Committee, petitioners, vs. HELEN B. HERNANDEZ, respondent.

[G.R. No. 151095. August 31, 2004]

CIVIL

SERVICE
COMMISSION petitioner,
HERNANDEZ, respondent.

vs. HELEN

B.

DECISION
TINGA, J.:

Subject of the consolidated petitions is the Decision of the Court of Appeals in


CA-G.R. SP No. 61081, entitled Helen B. Hernandez v. Tomas G. Velasquez,
promulgated on 07 November 2001. The assailed Decision annulled and set aside
the twin resolutions issued by the Civil Service Commission (CSC for brevity), in
Administrative Case No. 97-45 filed against respondent Hernandez. The CSC, in
its Resolution No. 00-1375 dated 13 June 2000, found respondent Hernandez
guilty of dishonesty and grave misconduct and ordered her dismissal from the
service, with all the accessory penalties including her perpetual disqualification
from holding public office. In Resolution No. 00-2064 dated 07 September 2000,
the CSC denied respondent's motion for reconsideration of Resolution No. 001375.
[1]

Stripped of non-essentials, the following are the factual antecedents:

In a letter dated 25 September 1996, the Assistant Schools Division


Superintendent of the DECS-CAR, (Cordillera Administrative Region) sent a letter
to petitioner (in G.R. No. 150732) Tomas G. Velasquez, informing him of the
alleged infractions committed by respondent, Helen B. Hernandez, such as
soliciting, accepting, and receiving sums of money, in exchange for transfer or
promotion of complainant teachers. Acting on the letter, petitioner Velasquez
convened a fact-finding committee to determine the veracity of the alleged
violations of respondent and to render a formal report and recommendation.
On 26 September 1996, the Committee composed of members assigned at the
DECS-Division of Abra, summoned to a meeting the teachers who have grievances
against respondent. Based on the sworn statements of the teachers, namely:
Elena Princena, Myrna Bayabos, Mildred Millare, Ofrina Benabese, Emilia Beralde,
Ruby Bringas, Regina Potolin, spouses Ernesto Callena, Jr. and Ma. Louisa
Callena, Irene Bermudez, Francisco Castillo, Elizabeth Castillo, Maribel Medrano,
Benigna Bulda, Irenea Viado, Cecilia Turqueza, Catherine Badere, Rosalinda
Bilgera, Nardita Tuscano, Henry Bisquera, Melba Linggayo, and Maritess Navarro,
it appears that respondent demanded and/or received money in various amounts
from the teachers in consideration of their appointment, promotion, and transfer
from one school to another.
On 15 November 1996, the Committee issued an Investigation
Report recommending the filing of administrative and criminal complaints against
respondent. On 14 March 1997, a formal charge for Grave Misconduct, Conduct
Grossly Prejudicial to the Best Interest of the Service, Abuse of Authority, and
Violation of Section 22 (k) Omnibus Rules Implementing Book V of E.O. 292 and
other related laws was filed against respondent.
On 24 March 1997, respondent filed her Answer to the charges. In the main,
she contended that the charges are brazen fabrications and falsehoods made by
parties with ulterior motives which are designed to harass her in a systematic
campaign to discredit her. Respondent likewise alleged that the preparation and
taking of the statements of the supposed 23 counts of irregularity leveled against
her were attended by coercion and fraud.
Meanwhile, the Office of the Provincial Prosecutor of Abra issued
a Resolution in I.S. No. 97-003 entitled, People of the Philippines v. Helen
Hernandez, et.al. ThisResolution, which arose from the sworn complaints filed by
the complaining teachers, indicted respondent and a certain Luzviminda de la Cruz
for violation of Section 3(b), Republic Act No. 3019 otherwise known as the AntiGraft and Corrupt Practices Act. The Resolution of the Provincial Prosecutor was
affirmed with modification by the Office of the Deputy Ombudsman for Luzon in
its Review Action dated 6 November 1997. Under the modified indictment,

respondent and dela Cruz were charged with direct bribery.However, upon motion
filed by respondent and her co-accused, the Office of the Deputy Ombudsman in
its Order dated 24 February 1998, reconsidered and set aside itsReview
Action dated 6 November 1997, and ordered the withdrawal of Informations for
direct bribery filed against respondent and de la Cruz.
After due proceedings, the CSC issued Resolution No. 00-1375, dated 13 June
2000, finding respondent guilty of the charges against her and ordering her
dismissal from the service. The motion for reconsideration filed by respondent was
denied by the CSC in its Resolution No. 00-2064 dated 7 September 2000.
Respondent appealed to the Court of Appeals raising the following issues:
1) Whether or not the CSC erred in assuming jurisdiction and/or in rendering judgment
adverse to her;
2) Whether or not the CSC erred in rendering judgment against her in violation of her right
to due process in administrative proceedings;
3) Whether or not the CSC erred in its appreciation of the evidence on record and;
4) Whether or not the CSC erred in imposing the penalty of dismissal.

[2]

The appellate court, in its now assailed Decision, reversed the resolutions of
the CSC. It opined that when petitioners filed a formal charge against respondent,
it was incumbent upon them to inform the Civil Service Commission that another
case was filed before the Office of the Deputy Ombudsman for Luzon considering
that the facts and circumstances from which both complaints stem are the same.
Citing Section 13 (1) of Article XI of the 1987 Constitution, and Section 19 and 21
of Republic Act No. 6770, the appellate court added that the CSC and the Office of
the Ombudsman have concurrent original jurisdiction over administrative cases
filed against any government employee.Thus, it ruled that the effects of res
judicata or litis pendentia may not be avoided by varying the designation of the
parties, changing the form of the action, or adopting a different mode of presenting
ones case.
Anent the issue of violation of respondents right to due process, the appellate
court stressed that it is not enough that the twin requisites of notice and hearing be
present. It is important that the tribunal hearing the case must be unbiased; indeed,
if the government official or employee under investigation is not afforded the
opportunity to present his case before a fair, independent, and impartial tribunal,
the hearing would be futile. Considering that the composition of the fact-finding

Committee is in question, the appellate court concluded that it cannot properly be


said that there was a fair and impartial hearing of the petitioners case.
The appellate court also ruled that petitioner failed to discharge the burden of
proving by substantial evidence the averments of the complaint because it appears
that some affiants who executed sworn statements to support the charges against
respondent later retracted their statements and executed new statements, alleging
that they were merely induced to testify against respondent. It also noted that some
of the complaining teachers even failed to appear in the investigation to confirm
their respective sworn statements. The appellate court, therefore, annulled and set
aside the Resolutions of the CSC and ordered the payment of backwages to
respondent.
Separate appeals via petition for review were filed before this Court by
petitioner Velasquez, in his capacity as Officer-in Charge, Office of the School
Superintendent, DECS-Division of Abra (G.R. No.150732) and the Civil Service
Commission (G.R. No. 151095), assailing the decision of the appellate court. The
two petitions were ordered consolidated in a Resolution of this Court dated 25 June
2002. G.R. No. 150732, assigned to the Third Division of this Court, was ordered
consolidated with G.R. No. 151095, an En Banc case even if the first mentioned
petition has a lower docket number considering that both cases involve resolutions
of the Civil Service Commission.
The issues in both petitions are substantially the same.
In G.R. No. 150732, petitioner raised the following issues:
I.

THE COURT OF APPEALS GRAVELY ERRED IN DECLARING THAT THE FORMAL


CHARGE WHICH WAS FILED BY THE CSC AGAINST THE RESPONDENT
SHOULD CONTAIN A CERTIFICATION OF NON-FORUM SHOPPING.
II.

THE COURT OF APPEALS GRAVELY ERRED IN DECLARING THAT


RESPONDENT'S RIGHT TO ADMINISTRATIVE DUE PROCESS WAS VIOLATED.
III.

THE COURT OF APPEALS GRAVELY ERRED IN DECLARING THAT THE


EVIDENCE AGAINST THE RESPONDENT WAS INSUFFICIENT.
IV.

THE COURT OF APPEALS GRAVELY ERRED IN ORDERING THE


REINSTATEMENT OF THE RESPONDENT AND THE PAYMENT OF HER
BACKWAGES.
[3]

On the other hand, the following issues were raised by the CSC in G.R. No.
151095:
I.

WHETHER OR NOT THE FORMAL CHARGE SHOULD CONTAIN A


CERTIFICATE AGAINST FORUM SHOPPING;
II.

WHETHER OR NOT THE CSC ERRED IN RENDERING JUDGMENT AGAINST


RESPONDENT IN VIOLATION OF THE LATTERS RIGHT TO DUE PROCESS IN
ADMINISTRATIVE PROCEEDINGS;
III.

WHETHER OR NOT THE CSC ERRED IN ITS APPRECIATION OF THE EVIDENCE


ON RECORD AND FINDING RESPONDENT GUILTY OF THE OFFENSES
CHARGED.
[4]

In both cases, petitioners asseverate that under Section 21 of the Uniform


Rules of Procedure in the Conduct of Administrative Investigations (CSC
Resolution No. 99-1936, dated 31 August 1999), it is the complaint and the not the
formal charge which should contain a certification of non-forum shopping. The
Office of the Solicitor General strongly argues that the formal charge was filed, not
by the complaining teachers or the DECS Fact-Finding Committee, but by the
CSC-CAR and it would thus be unnecessary to require a certification of non-forum
shopping considering that the CSC is the sole arbiter of all contests relating to the
Civil Service and it would be absurd for the CSC-CAR to file the same
administrative case against respondent in another forum. The OSG adds that there
was no need for the CSC-CAR to inform the CSC about the criminal action for
Direct Bribery in OMB-1-96-2757 because the said action was not filed by the
CSC-CAR.
The CSC on the other hand, argues that what was filed with the Office of the
Ombudsman is a criminal case and while the facts therein may be similar to the
pending administrative case, the Office of the Ombudsman and the CSC will not
rule on the same cause of action or grant the same relief. According to the CSC,
there is no possibility of having conflicting decisions as the two cases are distinct
from each other.

Petitioners dispute the Court of Appeals finding that respondents right to


administrative due process was violated. Respondent can hardly be said to have
been deprived of due process as she was given the chance to answer the charges,
to submit countervailing evidence, and to cross-examine the witnesses against her.
The mere fact that respondent questioned the impartiality of the fact finding
committee will not automatically result in a denial of due process because what
matters is that respondent had actively participated in the proceedings against
her. Petitioners add that respondents culpability was not based solely on the report
of the fact-finding committee, but also on the evidence submitted by the
respondent which, unfortunately, was found wanting.
Succinctly, petitioners argue that the appellate court erred in holding that the
evidence they presented to establish the culpability of the respondent is
insufficient. The finding is based merely on the retraction of the sworn statements
of some three teachers and the failure of three others to appear during the formal
investigation. Petitioners stress that a majority of the complainant teachers
remained consistent in their claim that respondent actually and directly received
from them various amounts of money in exchange for their appointment,
promotion, or transfer. They add that the dismissal of the criminal action against
respondent in OMB-1-96-2757 cannot be treated as a bar to the administrative
case primarily because administrative liability is distinct from penal liability. In
conclusion, petitioners fault the appellate court for reversing the factual findings of
the CSC, ordering the reinstatement of respondent, and awarding backwages in
her favor.
Upon the other hand, respondent would have the Court sustain the Decision of
the appellate court exonerating her of all the charges in the administrative case.
Citing CSCResolution No. 95-3099, respondent argues that even on the
assumption that a certificate of non-forum shopping is not necessary in the formal
charge, petitioners nevertheless failed to show that the complaint filed by the
teachers contained the required certification of non-forum shopping. She theorizes
that since it is the CSC-CAR which filed the formal charge against her, it would be
difficult to imagine that the CSC will make a turn around and take a position
contrary to its earlier findings that a prima facie case against her
exists. Respondent insists that to allow the CSC to exercise jurisdiction over the
case would be similar to allowing one person to act as prosecutor and judge at the
same time.
In support of the appellate courts Decision, respondent maintains that it
correctly ruled that there was no fair and impartial hearing of her case before the
fact-finding committee. She contends that the integrity of the fact-finding committee
is questionable considering that the chairperson of the committee is a relative of
one of the complainant teachers, Ms. Immaculada Bringas, who incidentally would

be the next in rank if she is ousted from her position. Finally, she adds that
petitioners are urging this Court to review the factual findings of the appellate court
which cannot be done in the instant petition which must raise only questions of law.
The Court rules for the petitioners.
CSC Resolution No. 95-3099 dated 9 May 1995 (Further Amended by CSC
Resolution No. 99-1936, dated 31 August 1999), amending Section 4 of CSC
Resolution No. 94-0521, Series of 1994, provides:
Section 4. Complaint in Writing and Under Oath - No complaint against a civil servant
shall be given due course, unless the same is in writing and under oath.
The complaint should be written in a clear, simple and concise language and in a systematic
manner as to apprise the civil servant concerned of the nature and cause of the accusation
against him and to enable him to intelligently prepare his defense or answer.
The complaint shall also contain the following:
(a) xxx xxx xxx xxx
(b) xxx xxx xxx xxx
(c) xxx xxx xxx xxx
(d) a statement that no other administrative action or complaint against the same party
involving the same acts or omissions and issues, has been filed before another agency or
administrative tribunal. In the absence of any one of the requirements therein stated, the
complaint shall be dismissed. (Underscoring supplied)
The appellate court placed much reliance on the above-quoted provision of
CSC Resolution No. 95-3099 in relation to Section 5, Rule 7 of the 1997 Rules of
Civil Procedure, when it ruled that it was incumbent upon petitioner (in G.R. No.
150732) to inform that another case was filed before the Office of the Deputy
Ombudsman for Luzon.Strikingly, the appellate court failed to state in
its Decision the person or entity which petitioner must notify of the pending case
with the Ombudsman. The appellate court then cited a litany of cases on forum
shopping and concluded that petitioners failure to state in the formal charge that
there is no other action or complaint pending against herein respondent constitutes
a violation of the rule against forum shopping that merited the dismissal of the
complaint. It ratiocinated that since the facts and circumstances from which both
complaints stem from are the same, petitioners should have attached in their
complaint the certificate of non-forum shopping. Inconsistently, however, the

appellate court was quick to add that the cause of action in the CSC and the Office
of the Deputy Ombudsman are distinct; nevertheless, it said that in order to obviate
the risk of violating the rule, petitioners should have attached the certification
against non-forum shopping.
The Court finds the above disquisition unsound.
Forum shopping consists of filing of multiple suits involving the same parties for
the same cause of action, either simultaneously or successively, for the purpose of
obtaining a favorable judgment. It may also consist in a party against whom an
adverse judgment has been rendered in one forum, seeking another and possibly
favorable opinion in another forum other than by appeal or special civil action of
certiorari.
[5]

[6]

The most important factor in determining the existence of forum shopping is the
vexation caused the courts and parties-litigants by a party who asks different
courts to rule on the same or related causes or grant the same or substantially the
same reliefs. A party, however, cannot be said to have sought to improve his
chances of obtaining a favorable decision or action where no unfavorable decision
has ever been rendered against him in any of the cases he has brought before the
courts.
[7]

In not a few cases, this Court has laid down the yardstick to determine whether
a party violated the rule against forum shopping as where the elements of litis
pendentia are present or where a final judgment in one case will amount to res
judicata in the other. Stated differently, there must be between the two cases (a)
identity of parties; (b) identity of rights asserted and reliefs prayed for, the relief
being founded on the same facts; and (c) that the identity of the two preceding
particulars is such that any judgment rendered in the other action will, regardless of
which party is successful, amount to res judicata in the action under consideration.
[8]

[9]

It is significant to note that the action filed before the CSC-CAR is


administrative in nature, dealing as it does with the proper administrative liability, if
any, which may have been incurred by respondent for the commission of the acts
complained of. In stark contrast, the case filed before the Office of the Deputy
Ombudsman for Luzon, which incidentally was not initiated by herein petitioners
but by the complainant teachers, deals with the criminal accountability of the
respondent for violation of the Anti-Graft and Corrupt Practices Act. Unmistakably,
the rule on forum shopping would find no proper application since the two cases
although based on the same essential facts and circumstances do not raise
identical causes of action and issues. It would, therefore, be absurd to require the
certification of forum shopping to be attached to the formal charge filed before the
CSC, for the evil sought to be curbed by the proscription against forum shopping is
simply not extant in the instant case.
[10]

On the issue of her having been denied administrative due process, the Court
likewise finds respondents claim untenable.
The essence of due process is that a party be afforded a reasonable
opportunity to be heard and to present any evidence he may have in support of his
defense or simply an opportunity to be heard; or as applied to administrative
proceedings, an opportunity to seek a reconsideration of the action of ruling
complained of. One may be heard, not solely by verbal presentation but also, and
perhaps even many times more creditably than oral argument, through
pleadings. Technical rules of procedure and evidence are not even strictly applied
to administrative proceedings, and administrative due process cannot be fully
equated to due process in its strict judicial sense.
[11]

[12]

[13]

In fact in Pefianco v. Moral, the Court had the occasion to rule that a
respondent in an administrative case is not entitled to be informed of the findings
and recommendations of any investigating committee created to inquire into
charges filed against him he is entitled only to the administrative decision based on
substantial evidence made of record, and a reasonable opportunity to meet the
charges and the evidence presented against him during the hearing of the
investigation committee. It is the administrative resolution, not the investigation
report, which should be the basis of any further remedies that the losing party in an
administrative case might wish to pursue.
[14]

Respondent had been amply accorded the opportunity to be heard. She was
required to answer the formal charge against her and given the chance to present
evidence in her behalf. She actively participated in the proceedings and even
cross-examined the witnesses against her. Clearly, based on the above
jurisprudential pronouncements the appellate courts finding that respondent was
denied due process is utterly without basis.
Administrative proceedings are governed by the substantial evidence rule. A
finding of guilt in an administrative case would have to be sustained for as long as
it is supported by substantial evidence that the respondent has committed the acts
stated in the complaint or formal charge. As defined, substantial evidence is such
relevant evidence as a reasonable mind may accept as adequate to support a
conclusion. This is different from the quantum of proof required in criminal
proceedings which necessitates a finding of guilt of the accused beyond
reasonable doubt. The Ombudsman, in ordering the withdrawal of the criminal
complaints against respondent was simply saying that there is no evidence
sufficient to establish her guilt beyond reasonable doubt which is a condition sine
qua non for conviction. Ergo, the dismissal of the criminal case will not foreclose
administrative action against respondent.
[15]

[16]

In the instant case, this Court is of the view that the sworn complaints of the
twenty remaining complainants coupled with their positive testimonies in the
proceedings below, more than adequately complies with the standard of proof
required in administrative cases. The desistance executed by three (3) out of the
twenty-three(23) original complainants is of no moment since administrative
actions cannot be made to depend upon the will of every complainant who may, for
one reason or another, condone a detestable act.
[17]

All told, the Court holds that respondents guilt in the administrative case has
been sufficiently established and pursuant to existing Civil Service Rules and
Regulations, her dismissal from the service is warranted.
[18]

WHEREFORE, the instant consolidated petitions are hereby GRANTED. The


assailed Decision of the Court of Appeals is hereby REVERSED and SET
ASIDE. Costs against the respondent.
SO ORDERED.
Davide, Jr., C.J., Quisumbing, Ynares-Santiago, Austria-Martinez, Corona,
Carpio-Morales, Callejo, Sr., Azcuna, and Chico-Nazario, JJ., concur.
Puno, Panganiban, Sandoval-Gutierrez, and Carpio, JJ., on official leave.
G.R. No. 162994. September 19, 2005]
DUNCAN ASSOCIATION vs. GLAXO
SECOND DIVISION
Sirs/Mesdames:
Quoted hereunder, for your information, is a resolution of this Court dated SEP 19 2005.
G.R. No. 162994 (Duncan Association Of Detailman-PTGWO and Pedro A. Tecson vs. Glaxo Wellcome Philippines,
Inc.)
For resolution is a Motion for Reconsideration dated 8 October 2004, filed by petitioners who seek the reversal of
the Court's Resolution1 dated 17 September 2004 denying the instant Petition for Review.
A brief recapitulation of the facts is in order. Petitioner Pedro Tecson ("Tecson") was employed in 1995 by
respondent Glaxo Wellcome Philippines, Inc. ("Glaxo") as a medical representative. He was assigned to market
Glaxo's products in the Camarines Sur-Camarines Norte sales area. Upon his employment, Tecson signed an
employment contract, wherein he agreed, among others, to study and abide by existing company rules; to disclose
to management any existing or future relationship by consanguinity or affinity with co-employees or employees of
competing drug companies; and if management found that such relationship posed a possible conflict of interest, to
resign from the company.
Nonetheless, Tecson became romantically involved with Bettsy, an employee of a rival pharmaceutical firm Astra
Pharmaceuticals ("Astra"). The two eventually married in September of 1998. The relationship, including the
subsequent marriage, was cause for consternation to Glaxo. On January 1999, Tecson's superiors informed him
that his marriage to Bettsy had given rise to a conflict of interest. Negotiations ensued, with Tecson adverting to

his wife's possible resignation from Astra, and Glaxo making it known that they preferred to retain his services
owing to his good performance. Yet no resolution came to pass. In September 1999, Tecson applied for a transfer
to Glaxo's milk division, but his application was denied in view of Glaxo's "least-movement-possible" policy. Then in
November 1999, Glaxo transferred Tecson to the Butuan City-Surigao City-Agusan del Sur sales area. Tecson asked
Glaxo to reconsider its decision, but his request was denied.
The matter was then brought to the Glaxo Grievance Committee, and subsequently to a voluntary arbitrator. On 15
November 2000, the National Conciliation and Mediation Board (NCMB) rendered itsDecision declaring as valid
Glaxo's policy on relationships between its employees and persons employed with competitor companies, and
affirming Glaxo's right to transfer Tecson to another sales territory. This Decision was assailed by petitioners before
the Court of Appeals and this Court, but for naught.
The present Motion for Reconsideration advances four main arguments: that the Court erroneously relied on a
conjectural presumption that Tecson's relationship might compromise the interest of the company or allow a
competitor to gain access to Glaxo's secrets and procedures; that Glaxo's policy regarding the marriage of its
employees to employees of rival companies is contrary to public policy, morals and good customs; that Glaxo
violated its own policy which authorized the transfer of the subject employee to another department when it denied
Tecson's application to transfer to the milk division; and that Tecson was constructively dismissed when he was
transferred to the Butuan City-Surigao City-Agusan del Sur sales area.
One of the central anchors of the assailed Resolution was the holding that Glaxo's policy on marriage did not
violate the equal protection clause of the Constitution, 2 as the constitutional guarantee does not encompass
discriminatory behavior engaged by private individuals. 3 Petitioners do not challenge this holding of the Court, and
we see no reason to revisit this issue.
But before we engage in a renewed discussion on the validity of Glaxo's policy itself, we should examine the claim
that Tecson was constructively dismissed. After all, assuming that the policy itself were declared invalid, a finding
nonetheless that Tecson was not constructively dismissed would still render this petition futile. The Court has ruled
Tecson was not actually dismissed, and the Motion for Reconsideration adduces no substantial reasons why this
holding should be reversed.
The Resolution cited Abbott Laboratories (Phils.), Inc. v. NLRC4 wherein the Court upheld the prerogative of a drug
company to reassign a medical representative under its employ to a new territory. In the same vein, the Court has
consistently affirmed as a valid prerogative of the employer the reasonable reassignment or transfer of an
employee. As held in Philippine Japan Active Carbon Corp. v. NLRC:5
It is the employer's prerogative, based on its assessment and perception of its employees' qualifications, aptitudes,
and competence, to move them around in the various areas of its business operations in order to ascertain where
they will function with maximum benefit to the company. An employee's right to security of tenure does not give
him such a vested right in his position as would deprive the company of its prerogative to change his assignment or
transfer him where he will be most useful. When his transfer is not unreasonable, nor inconvenient, nor prejudicial
to him, and it does not involve a demotion in rank or a diminution of his salaries, benefits, and other privileges, the
employee may not complain that it amounts to a constructive dismissal. 6
In Philippine Telegraph and Telephone Corp. v. Laplana,7 the Court again upheld the prerogative of management to
reassign an employee to a different locality, despite the "personal inconvenience or hardship that will be caused to
the employee by reason of the transfer."
Tecson was not relieved of his employment with Glaxo. Neither was he transferred to a different position of lower
rank or remuneration. The alleged constructive dismissal pertained to his transfer to Butuan from Naga City, a
reassignment that would fall within the ambit of management's prerogative to transfer employees.
Petitioners, in their Motion for Reconsideration, purport that constructive dismissal was proved by the allegation
that Tecson's commissions for January and February were withheld from him, and that he was forced to surrender
his sales paraphernalia. Yet the veracity of these factual allegations were not acknowledged by either the voluntary
arbitrator or the Court of Appeals. This Court, which is not a trier of facts, could not very well at this late stage
reverse the established factual conclusions on the basis of mere allegations which have not been previously
substantiated but which in fact have been consistently rebutted by the respondents. 8

In case of a constructive dismissal, the employer has the burden of proving that the transfer and demotion of an
employee are for valid and legitimate grounds, i.e., that the transfer is not unreasonable, inconvenient, or
prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and
other benefits.9 In this case, Glaxo did not opt to terminate or demote Tecson, but transferred him to a sales
region that included the respective home provinces of himself and his wife, and offered monetary assistance to
shoulder his family's relocation.10. Certainly, the choice of location was not selected with petty malice
aforethought, but even designed for the easier palatability of the employee.
The fact that the employee may be displaced from established roots by reason of the transfer is not sufficient to
deny the valid management prerogative to transfer its employees. Tecson himself had acknowledged this
prerogative when he signed the contract of employment which expressly agreed "to be assigned any work or work
station for such periods as may be determined by the company and whenever the operations require such
assignment."
This finding that Tecson was not actually dismissed is determinative of this case, especially considering that his
transfer by Glaxo from Naga to Butuan would have been a valid exercise of an employer's prerogative, whether or
not the company policy on marriage subsists. Nonetheless, it would be specious to assume that Tecson's transfer
had nothing to do with his marriage to an employee from a rival drug company. Moreover, questions on the validity,
if not appropriateness of Glaxo's policy itself, has attracted comment on the various triers of this case, as well as
the public at large.
May an employer impose conditions, restrictions or consequences on an employee by reason of the latter's choice
to marry or choice of spouse? The answer would really all depend on the particular circumstances in each case.
The governing legal framework should be established. Under Article 136 of the Labor Code, it is illegal for an
employer to prohibit a female employee from getting married or to actually dismiss, discharge, discriminate or
otherwise prejudice a woman employee merely by reason of her marriage. This provision addresses a concern,
particularly gender discrimination, with no direct relevance to this case. Nonetheless, it can be invoked by a female
employee who finds herself prohibited by her employer from contracting marriage, or otherwise dismissed or
discriminated upon by reason of her marriage, and the employer faces the unenviable burden of establishing the
inapplicability of Article 136.11
Of more general application is Article 282 of the Labor Code, which governs the termination by employers for "just
causes." Had Tecson been actually terminated in this case, Article 282 would have necessarily found application,
since Articles 282 to 284 stand as the only basis in law for the valid termination of an employee by an employer.12
Under Article 282, the employer may dismiss the employee for any of the following causes: (a) serious misconduct
or willful disobedience by the employee of the lawful order of his employer or representative in connection with his
work; (b) gross and habitual neglect by the employee of his duties; (c) fraud or willful breach by the employee of
the trust reposed in him by his employer or duly authorized representative; (d) commission of a crime or offense
against the person of his employer or any immediate member of his family or his duly authorized representative;
and (e) other causes analogous to the foregoing. Assuming that there is a company policy allowing the dismissal,
constructive13 or otherwise, of an employee by reason of the employee's marriage or choice of spouse, such policy
alone cannot justify the dismissal. The employer will have to establish not only the existence of the policy, but the
presence of any of the grounds enumerated in Article 282. Our Constitution and Labor Code guarantee an
employee's security of tenure. For regular employees as defined under the Labor Code, security of tenure is
assured by the prohibition against termination except for the causes enumerated under Articles 282 to 284.
Thus, the validity of a company policy on marriage such as that maintained by Glaxo would not necessarily be
determinative of the question of whether an employee who violated such policy may be terminated. Still, there
may be instances wherein the validity of the policy, whether standing by itself or as incorporated into an
employment contract, would be the decisive factor. Such may arise if for example, the employee is sought to be
dismissed on the ground of loss of confidence,14 and such loss of confidence developed due to the marriage to an
employee from a rival company. In such cases wherein it is necessary to pass judgment on the employer's policy
itself, the following points should be considered.
Both the Constitution and our body of statutory laws accord special status and protection to the contract of
marriage. Our Constitution recognizes that "marriage, as an inviolable social institution, is the foundation of the
family, and shall be protected by the State,"15 and our Family Code acknowledges that marriage is "a special

contract of permanent union ... an inviolable social institution whose nature, consequences and incidents are
governed by law."16 It may be debatable whether these provisions, by themselves, may be the source of operative
and executory rights, but at the very least, they establish a pervasive public policy that frowns upon acts that
encumber any person's freedom to marry.
Moreover, if such encumbrance is contained in an employment contract, the stipulation can be declared void under
Article 1409(1) of the Civil Code, which provides that a contract whose cause, object or purpose is contrary to law,
morals, good customs, public order or public policy is inexistent and void from the beginning. 17 The standard is of
great utility, as it allows a measure of relief for persons laboring under private contractual obligations that, while
insusceptible to the traditional constitutional challenge under the Bill of Rights, nonetheless stand as onerous to the
obligor and noxious to our general body of laws.
Still, it would be injudicious, if not irresponsible, to judicially enforce a universal position that disencumbers
marriage from adverse consequences, if the encumbrance stands to protect third persons inevitably affected by an
act of marital union. For much as we may want to see and regard marriage in a vestal state, it may be a source of
negativity for third persons, and not just the jilted. This is apparent even on the most visceral level, as anybody
who dislikes an immediate family member's choice of bride or groom can attest to. The statutory protections
accorded to marriage do not translate to a legal compulsion on people to favor another person's choice in spouse.
The thesis is harmless enough if the consequence of such disapproval extends merely into the personal sphere and
not the legal. Yet, such as in this case, the consequences may be economic as well. For example, an aunt who
voluntarily extends regular financial benefits to a nephew may refuse to continue the doleout by reason of the
relative's marriage or choice of wife. In such a case, the nephew would have no cause of action to compel his aunt
to continue the remuneration, even if the aunt's reasons for disliking the new wife are noxious, such as bigotry. The
invocation of the inviolability of marriage or its protection under law will not suffice to legally compel the aunt to
extend her largesse to her nephew, for this act of charity arises solely from private volition. The State may protect
marriage, but it cannot compel private persons to give away money out of their pockets to the bride and groom.
If the prohibitions or restrictions are contained in a private employment policy or contract, the norms that would
govern their review are such as those contained in the Labor Code, and to an extent, the "public policy" clauses of
the Civil Code.18 However, the sanctity of the marital vow should not be the only relevant consideration at hand.
The considerations which may have impelled the employer to impose such conditions on the employee's absolute
right to marry warrant examination as well.
We can surmise that if the restrictions or conditions on the employee's right to marry bear no relevance to any
interests that the employer should be concerned with, then they should be voided if they are of obligatory import.
In that regard, it is difficult to foresee an instance wherein an absolute prohibition on any marriage imposed on the
employees may be sanctioned.19 Even if the prohibition is premised on the belief that a married employee would
be able to devote less time to the job, whatever causal economic concerns hardly outweigh the right of an
individual to get married. Employees this day and age have long transcended the yoke of serfdom and absolute
fealty to master and the expense of the marital bind.
If the prohibition or restriction pertains to the choice of spouse, rather than the choice to marry at all, there should
be an examination of the rationale behind the constraint. Again, if the restrictions or conditions bear no relevance
to any interests that the employer should be concerned with, then they should not be upheld. Restrictions that are
nothing more than the enforcement of personal biases, such as prohibitions on marrying members of a particular
race or ethnic group, may be struck down.
Nonetheless, while generalities may be sufficient to strike down the most obnoxious of prohibitions, those
restrictions that are geared towards maintaining valid economic concerns of the employer have to be assessed on a
case to case basis. Our fundamental law respects the right of enterprises to adopt and enforce such a policy to
protect its right to reasonable returns on investments and to expansion and growth. 20
If the rationale in question relates to a consideration so vital to the interests of the employer as to warrant legal
protection, it should then be determined whether the means employed by the employer are reasonable enough as
to allow a measure of balance between these key interests of the employer and the fundamental right of the
employee to marry.

Let us pay particular attention to Glaxo's policy. As noted in the Resolution, Glaxo belongs to the highly competitive
pharmaceutical industry. The competitive nature of the business is further highlighted by the fact that
pharmaceutical drugs are indispensable to modern society, and that the rival companies tend to produce drugs of
like effect but marketed under respective brand names. Thus, within the pharmaceutical industry, the hazard of
industrial espionage looms largely, more so than most other competitive industries. To that end, Glaxo is entitled to
guard its trade secrets, manufacturing formulas, marketing strategies and other confidential programs and
information from competitors, concomitant to its right to protect its own economic interests.
This in mind, it is but reasonable for Glaxo to be cautious about the social interaction of its employees with those of
companies which it directly competes with. If the employee goes as far as sharing hearth and home with the
employee of the rival company, there is greater cause of concern on the part of Glaxo. The fear may not so much
arise from the possibility of willful betrayal by its employees of trade secrets, but from the myriad opportunities in
the course of shared lives that one may inadvertently divulge to the spouse confidential information that the rival
drug company may benefit from. After all, the employer has no control over pillow talk. Neither could it be
expected that the employee maintain a higher fidelity to the employer than to the spouse.
It may be so, as petitioners argue, much of the fear is hypothetical in nature. Yet Glaxo, as with any other industry,
is allowed to take reasonable steps in order to prevent potential damage from becoming actual, especially if the
economic consequences are substantial. Glaxo is hardly a small-scale industry, and the pharmaceutical business
seldom characterized by old-fashioned rectitude.
Still, these concerns aside, the steps that Glaxo may employ to avoid the undue divulgence of its trade secrets
should be within reason. If termination is to be considered as an option, it should be only as a final resort, if there
is no other way to avoid the conflict of interest.
In this case, Glaxo's assailed policy does not call for automatic termination, providing as it does a process that
allows for all the opportunities for a mutually agreeable solution. Per the Employee Handbook, "every effort shall be
made, together by management and the employee, to arrive at a solution within six (6) months, either by transfer
to another department in a non-counter checking position, or by career preparation toward outside employment
after Glaxo Wellcome. Employees must be prepared for possible resignation within six (6) months, if no other
solution is feasible."21
This procedure is extremely reasonable under the circumstances, and we have no problems in upholding its
validity. As noted in the Resolution: "[i]n any event, from the wordings of the contractual provision and the policy
in its employee handbook, it is clear that Glaxo does not impose an absolute prohibition against relationships
between its employees and those of competitor companies. Its employees are free to cultivate relationships with
and marry persons of their own choosing."22 It recognizes the concern arising from the possible conflict of interest,
yet dissuades the enforcement of a hasty, unilateral solution. It appears from the record of this case that such a
procedure was adopted in good faith by both parties. Tecson may find fault with the fact that Glaxo refused his
request for transfer to the milk division, a step which, if resorted to, may have resolved the perceived conflict of
interest. Yet the procedure involved allows the transfer only if mutually agreed upon, and besides, employees
cannot generally compel the employer to transfer them from one division to another, this being a management
prerogative.
And finally, if no mutual resolution is arrived at, termination and voluntary resignation remain as viable options.
Neither obtained in this case, and we have already ruled that the transfer was valid and did not constitute
constructive dismissal. If Glaxo, or any employer with a similarly drawn-out procedure, were to ultimately resort to
termination, the burden would still fall upon it to establish that such termination is in accordance with the just
causes as provided in Article 282 of the Labor Code. Without such linkage, the termination would be invalid.
The fact that there was no actual termination in this case obviates the need for us to further apply Article 282 or
the jurisprudential rules on illegal termination to this case.
Still, should Glaxo retain the said policy, and another employee trek the same trail as Tecson did, it cannot be
foreordained that the Court would similarly rule for Glaxo and against the said employee. As repeatedly
emphasized, it all depends on the particular circumstances of each case. And ultimately, if dismissal, constructive
or otherwise, is resorted to, the standards for termination set by the Labor Code must still be complied with.
WHEREFORE, petitioner's Motion for Reconsideration is DENIED WITH FINALITY.

Very truly yours,


(Sgd.) LUDICHI YASAY-NUNAG
Clerk of Court

Endnotes:
1 G.R. No. 162994, 17 September 2004, 438 SCRA 343.
2 See Section 1, Article III, Constitution.
3 "The challenged company policy does not violate the equal protection clause of the Constitution as petitioners

erroneously suggest. It is a settled principle that the commands of the equal protection clause are addressed only
to the state or those acting under color of its authority. Corollarily, it has been held in a long array of U.S. Supreme
Court decisions that the equal protection clause erects no shield against merely private conduct, however
discriminatory or wrongful. The only exception occurs when the state in any of its manifestations or actions has
been found to have become entwined or involved in the wrongful private conduct. Obviously, however, the
exception is not present in this case. Significantly, the company actually enforced the policy after repeated requests
to the employee to comply with the policy. Indeed, the application of the policy was made in an impartial and evenhanded manner, with due regard for the lot of the employee." Duncan Association v. Glaxo, supra note 1 at 354355.
4 G.R. No. L-76959, 12 October 1987, 154 SCRA 713.
5 G.R. No. 83239, 8 March 1989, 171 SCRA 164.
6 Ibid.
7 G.R. No. 76645, 23 July 1991, 199 SCRA 485.
8 See Rollo, pp. 76-77.
9 Castillo v. NLRC, 367 Phil. 605 (1999).
10 Rollo, p. 210.
11 We have held that a company policy prohibiting female employees from contracting marriage during their

employment is void for violating Article 136 of the Labor Code.See PT&T v. NLRC, 338 Phil. 1093 (1997). However,
the American case of Emory v. Georgia Hospital Service Association, previously cited in our Decision, is also worth
noting. Therein, a female employee was discharged by her employer, a health insurance firm, for having married a
salesman from a rival insurance company. The discharged employee brought suit under the Civil Rights Act of
1964, alleging unlawful discrimination against her because of her sex. However, the Georgia District Court ruled
that plaintiff was validly terminated, as her termination was occasioned not by reason of her sex, but by her
violation of company policy prohibiting marriage to employees of directly competing insurance businesses. Emory v.
Georgia Hospital Service Association (1971), DC Ga., 4 CCH EPD 7785, 4 BNA FEP Cas 891, affd (CA5) 446 F2d
897, 4 CCH EPD 7786; Cited 45 Am Jur 2d Sec. 469.
12 In this case, Articles 283 (governing dismissals for authorized causes), and 284 (on dismissals on the ground of

disease) would not have found application.

13 "In constructive dismissal, the employer has the burden of proving that the transfer and demotion of an

employee are for just and valid grounds such as genuine business necessity. The employer must be able to show

that the transfer is not unreasonable, inconvenient, or prejudicial to the employee. It must not involve a demotion
in rank or a diminution of salary and other benefits. If the employer cannot overcome this burden of proof, the
employee's demotion shall be tantamount to unlawful constructive dismissal." Globe Telecom v. Florendo-Flores,
438 Phil. 756 (2002).
14 "Loss of confidence, as a just cause for termination of employment, is premised on the fact that the employee

concerned holds a position of responsibility, trust and confidence. He must be invested with confidence on delicate
matters such as the custody, handling, care and protection of the employer's property and/or funds. But in order to
constitute a just cause for dismissal, the act complained of must be "work-related" such as would show the
employee concerned to be unfit to continue working for the employer." Gonzales v. NLRC, G.R. No. 131653, 26
March 2001, 355 SCRA 195.
15 Section 2, Article XV, CONSTITUTION.
16 Article 1, FAMILY CODE.
17 See Article 1409 (1), Civil Code. See also Article 1352, Civil Code, which states that "[C]ontracts without cause,

or with unlawful cause, produce no effect whatever. The cause is unlawful if it is contrary to law, morals, good
customs, public order or public policy." Yet, while the principle is of long-standing recognition, it is also of
purposeful ambiguity. "Public policy" is a vague expression, and few cases can arise in which its application may
not be disputed. Noble v. City of Palo Alto, 89 Cal. App. 47, 50-51 (1928). A court's power to void a contract as
being in contravention of public policy has been described as delicate and undefined, see Jeffrey Lake
Development, Inc. v. Central Nebraska Public Power and Irrigation Dist., 262 Neb. 515, 633 N.W. 2d 102 (2001); In
re Kaufman, 201 OK 88, 37 P.3d 845 (Okla. 2001), and is thus exercised sparingly. First Nat. Bank of Springfield v.
Malpractice Research, Inc., 179 III. 2d 353, 228 III. Dec. 202, 688 N.E. 2d 1179, 70 A.L.R. 5th 759. The concepts
of "morals", "good customs", and "public order" are no less susceptible to easy definition.
18 Properly speaking, Articles 1306, 1352 and 1409 (1) pertain to contracts. These provisions can operate to nullify

clauses contained in employment contracts. We are aware though that in many establishments, employees are not
required to sign formal contracts, but are otherwise enjoined to observe company policies. The absence of a formal
contract would not preclude the application of the Civil Code in preventing the enforcement of obligations that are
contrary to law, good customs or public policy. Article 1183 of the Civil Code mandates the annulment of conditions
to an obligation that are contrary to good customs, public policy, or otherwise prohibited by law. Moreover, Article 6
prohibits the waiver of rights if such waiver is contrary to law, public order, public policy, morals or good customs.
Such rights would include the right to marry or the choice of whom to marry.
19 The grey area may exist in instances wherein the employer is a religious order which, in accordance with its

tenets, demands a vow of celibacy. In such a case, the freedom of exercise of religion would be accorded its due
respect, depending on its appropriate applicability in the particular case.
20 See Section 3, Article XIII, CONSTITUTION.
21 See Duncan Association v. Glaxo, supra note 1 at 352.
22 Id. at 355.