[G.R. No. 132601.

October 12, 1998]

LEO ECHEGARAY y PILO, petitioner, vs. THE SECRETARY OF

JUSTICE and THE DIRECTOR OF THE BUREAU OF
CORRECTIONS, THE EXECUTIVE JUDGE OF THE
REGIONAL TRIAL COURT OF QUEZON CITY AND THE
PRESIDING JUDGE OF REGIONAL TRIAL COURT OF
QUEZON CITY, BRANCH 104, respondents.
DECISION
PER CURIAM:

On June 25, 1996, this Court affirmed [1] the conviction of petitioner Leo
Echegaray y Pilo for the crime of rape of the 10 year-old daughter of his
common-law spouse and the imposition upon him of the death penalty for
the said crime.
Petitioner duly filed a Motion for Reconsideration raising mainly factual
issues, and on its heels, a Supplemental Motion for Reconsideration raising
for the first time the issue of the constitutionality of Republic Act No.
7659[2] (the death penalty law) and the imposition of the death penalty for
the crime of rape.
On February 7, 1998, this Court denied [3] petitioner's Motion for
Reconsideration and Supplemental Motion for Reconsideration with a finding
that Congress duly complied with the requirements for the reimposition of
the death penalty and therefore the death penalty law is not
unconstitutional.
In the meantime, Congress had seen it fit to change the mode of
execution of the death penalty from electrocution to lethal injection, [4] and
passed Republic Act No. 8177, AN ACT DESIGNATING DEATH BY LETHAL
INJECTION AS THE METHOD OF CARRYING OUT CAPITAL PUNISHMENT,
AMENDING FOR THE PURPOSE ARTICLE 81 OF THE REVISED PENAL CODE,
AS AMENDED BY SECTION 24 OF REPUBLIC ACT NO. 7659. [5] Pursuant to the
provisions of said law, the Secretary of Justice promulgated the Rules and
Regulations to Implement Republic Act No. 8177 ("implementing rules")

and directed the Director of the Bureau of Corrections to prepare the

Lethal Injection Manual.[7]
[6]

On March 2, 1998, petitioner filed a Petition [8] for Prohibition, Injunction

and/or Temporary Restraining Order to enjoin respondents Secretary of
Justice and Director of the Bureau of Prisons from carrying out the execution
by lethal injection of petitioner under R.A. No. 8177 and its implementing
rules as these are unconstitutional and void for being: (a) cruel, degrading
and inhuman punishment per se as well as by reason of its being (b)
arbitrary, unreasonable and a violation of due process, (c) a violation of the
Philippines' obligations under international covenants, (d) an undue
delegation of legislative power by Congress, (e) an unlawful exercise by
respondent Secretary of the power to legislate, and (f) an unlawful
delegation of delegated powers by the Secretary of Justice to respondent
Director.
On March 3, 1998, petitioner, through counsel, filed a Motion for Leave of
Court[9] to Amend and Supplement Petition with the Amended and
Supplemental Petition[10] attached thereto, invoking the additional ground of
violation of equal protection, and impleading the Executive Judge of the
Regional Trial Court of Quezon City and the Presiding Judge of the Regional
Trial Court, Branch 104, in order to enjoin said public respondents from
acting under the questioned rules by setting a date for petitioner's
execution.
On March 3, 1998, the Court resolved, without giving due course to the
petition, to require the respondents to COMMENT thereon within a nonextendible period of ten (10) days from notice, and directed the parties "to
MAINTAIN the status quo prevailing at the time of the filing of this petition."
On March 10, 1998, the Court granted the Motion for Leave of Court to
Amend and Supplement Petition, and required respondents to COMMENT
thereon within ten (10) days from notice.
On March 16, 1998, petitioner filed a Very Urgent Motion (1) To
clarify Status Quo Order, and (2) For the Issuance of a Temporary
Restraining Order expressly enjoining public respondents from taking any
action to carry out petitioner's execution until the petition is resolved.

On March 16, 1998, the Office of the Solicitor General [11] filed a Comment
(On the Petition and the Amended Supplemental Petition) [12] stating that (1)
this Court has already upheld the constitutionality of the Death Penalty Law,
and has repeatedly declared that the death penalty is not cruel, unjust,
excessive or unusual punishment; (2) execution by lethal injection, as
authorized under R.A. No. 8177 and the questioned rules, is constitutional,
lethal injection being the most modern, more humane, more economical,
safer and easier to apply (than electrocution or the gas chamber); (3)
the International Covenant on Civil and Political Rights does not expressly or
impliedly prohibit the imposition of the death penalty; (4) R.A. No. 8177
properly delegated legislative power to respondent Director; and that (5)
R.A. No. 8177 confers the power to promulgate the implementing rules to
the Secretary of Justice, Secretary of Health and the Bureau of Corrections.
On March 17, 1998, the Court required the petitioner to file a REPLY
thereto within a non-extendible period of ten days from notice.
On March 25, 1998, the Commission on Human Rights [13] filed a Motion
for Leave of Court to Intervene and/or Appear as Amicus Curiae[14] with the
attached Petition to Intervene and/or Appear as Amicus Curiae[15] alleging
that the death penalty imposed under R.A. No. 7659 which is to be
implemented by R.A. No. 8177 is cruel, degrading and outside the limits of
civil society standards, and further invoking (a) Article II, Section 11 of the
Constitution which provides: "The State values the dignity of every human
person and guarantees full respect for human rights."; (b) Article III of
the Universal Declaration of Human Rights which states that "Everyone has
the right to life, liberty and security of person," and Article V thereof, which
states that "No one shall be subjected to torture or to cruel, inhuman or
degrading treatment or punishment."; (c) The International Covenant on
Civil and Political Rights, in particular, Article 6 thereof, and the Second
Optional Protocol to the International Covenant on Civil and Political Rights
Aiming At The Abolition of the Death Penalty; (d) Amnesty International
statistics showing that as of October 1996, 58 countries have abolished the
death penalty for all crimes, 15 countries have abolished the death penalty
for ordinary crimes, and 26 countries are abolitionists de facto, which means
that they have retained the death penalty for ordinary crimes but are
considered abolitionists in practice that they have not executed anyone
during the past ten (10) years or more, or in that they have made an
international commitment not to carry out executions, for a total of 99

countries which are total abolitionists in law or practice, and 95 countries as

retentionists;[16] and (e) Pope John Paul II's encyclical, "Evangelium Vitae." In
a Resolution dated April 3, 1998, the Court duly noted the motion.
On March 27, 1998, petitioner filed a Reply [17] stating that (1) this Court
is not barred from exercising judicial review over the death penalty per se,
the death penalty for rape and lethal injection as a mode of carrying out the
death penalty; (2) capital punishment is a cruel, degrading and inhuman
punishment; (3) lethal injection is cruel, degrading and inhuman
punishment, and that being the "most modern" does not make it less cruel
or more humane, and that the Solicitor General's "aesthetic" criteria is shortsighted, and that the lethal injection is not risk free nor is it easier to
implement; and (4) the death penalty violates the International Covenant on
Civil and Political Rights considering that the Philippines participated in the
deliberations of and voted for the Second Optional Protocol.
After deliberating on the pleadings, the Court gave due course to the
petition, which it now resolves on the merits.
In the Amended and Supplemental Petition, petitioner assails the
constitutionality of the mode of carrying out his death sentence by lethal
injection on the following grounds:[18]
I.

DEATH BY LETHAL INJECTION IS UNCONSTITUTIONAL

FOR BEING A CRUEL, DEGRADING AND INHUMAN
PUNISHMENT.
II.

THE DEATH PENALTY VIOLATES THE INTERNATIONAL

COVENANT ON CIVIL AND POLITICAL RIGHTS, WHICH IS
PART OF THE LAW OF THE LAND.
III.

LETHAL INJECTION, AS AUTHORIZED UNDER REPUBLIC

ACT NO. 8177 AND THE QUESTIONED RULES, IS

UNCONSTITUTIONAL BECAUSE IT IS AN UNNECESSARY

AND WANTON INFLICTION OF PAIN ON A PERSON AND
IS, THUS, A CRUEL, DEGRADING, AND INHUMAN
PUNISHMENT.
IV.

REPUBLIC ACT NO. 8177 UNDULY DELEGATES

LEGISLATIVE POWER TO RESPONDENT DIRECTOR.
V.

RESPONDENT SECRETARY UNLAWFULLY DELEGATED THE

LEGISLATIVE POWERS DELEGATED TO HIM UNDER
REPUBLIC ACT NO. 8177 TO RESPONDENT DIRECTOR.
VI.

RESPONDENT SECRETARY EXCEEDED THE AUTHORITY

DELEGATED TO HIM UNDER REPUBLIC ACT NO. 8177 AND
UNLAWFULLY USURPED THE POWER TO LEGISLATE IN
PROMULGATING THE QUESTIONED RULES.
VII.

SECTION 17 OF THE QUESTIONED RULES IS

UNCONSTITUTIONAL FOR BEING DISCRIMINATORY AS
WELL AS FOR BEING AN INVALID EXERCISE BY
RESPONDENT SECRETARY OF THE POWER TO LEGISLATE.
VIII.

INJUCTION MUST ISSUE TO PREVENT IRREPARABLE

DAMAGE AND INJURY TO PETITIONER'S RIGHTS BY
REASON OF THE EXISTENCE, OPERATION AND
IMPLEMENTATION OF AN UNCONSTITUTIONAL STATUTE
AND EQUALLY INVALID AND IMPLEMENTING RULES.

Concisely put, petitioner argues that R.A. No. 8177 and its implementing
rules do not pass constitutional muster for: (a) violation of the constitutional
proscription against cruel, degrading or inhuman punishment, (b) violation of
our international treaty obligations, (c) being an undue delegation of
legislative power, and (d) being discriminatory.
The Court shall now proceed to discuss these issues in seriatim.
I.

LETHAL INJECTION, NOT CRUEL, DEGRADING OR INHUMAN

PUNISHMENT UNDER SECTION 19, ARTICLE III OF THE 1987
CONSTITUTION.

The main challenge to R.A. 8177 and its implementing rules is anchored
on Article III, Section 19 (1) of the 1987 Constitution which proscribes the
imposition of "cruel, degrading or inhuman" punishment. "The prohibition in
the Philippine Bill against cruel and unusual punishments is an Anglo-Saxon
safeguard against governmental oppression of the subject, which made its
first appearance in the reign of William and Mary of England in 'An Act
declaring the rights and liberties of the subject, and settling the succession
of the crown,' passed in the year 1689. It has been incorporated into the
Constitution of the United States (of America) and into most constitutions of
the various States in substantially the same language as that used in the
original statute. The exact language of the Constitution of the United States
is used in the Philippine Bill." [19] "The counterpart of Section 19 (1) in the
1935 Constitution reads: 'Excessive fines shall not be imposed, nor cruel and
inhuman punishment inflicted.' xxx In the 1973 Constitution the phrase
became 'cruel or unusual punishment.' The Bill of Rights Committee of the
1986 Constitutional Commission read the 1973 modification as prohibiting
'unusual' punishment even if not 'cruel.' It was thus seen as an obstacle to
experimentation in penology.Consequently, the Committee reported out the
present text which prohibits 'cruel, degrading or inhuman punishment' as
more consonant with the meaning desired and with jurisprudence on the
subject."[20]
Petitioner contends that death by lethal injection constitutes cruel,
degrading and inhuman punishment considering that (1) R.A. No. 8177 fails
to provide for the drugs to be used in carrying out lethal injection, the
dosage for each drug to be administered, and the procedure in administering
said drug/s into the accused; (2) R.A. No. 8177 and its implementing rules

are uncertain as to the date of the execution, time of notification, the court
which will fix the date of execution, which uncertainties cause the greatest
pain and suffering for the convict; and (3) the possibility of "botched
executions" or mistakes in administering the drugs renders lethal injection
inherently cruel.
Before the Court proceeds any further, a brief explanation of the process
of administering lethal injection is in order.
In lethal injection, the condemned inmate is strapped on a hospital
gurney and wheeled into the execution room. A trained technician inserts a
needle into a vein in the inmate's arm and begins an intravenous flow of
saline solution. At the warden's signal, a lethal combination of drugs is
injected into the intravenous line. The deadly concoction typically includes
three drugs: (1) a nonlethal dose of sodium thiopenthotal, a sleep inducing
barbiturate; (2) lethal doses of pancuronium bromide, a drug that paralyzes
the muscles; and (3) potassium chloride, which stops the heart within
seconds. The first two drugs are commonly used during surgery to put the
patient to sleep and relax muscles; the third is used in heart bypass surgery.
[21]

Now it is well-settled in jurisprudence that the death penalty per se is not

a cruel, degrading or inhuman punishment. [22] In the oft-cited case of Harden
v. Director of Prisons,[23] this Court held that "[p]unishments are cruel when
they involve torture or a lingering death; but the punishment of death is not
cruel, within the meaning of that word as used in the constitution. It implies
there something inhuman and barbarous, something more than the mere
extinguishment of life." Would the lack in particularity then as to the details
involved in the execution by lethal injection render said law "cruel, degrading
or inhuman"? The Court believes not. For reasons hereafter discussed, the
implementing details of R.A. No. 8177 are matters which are properly left to
the competence and expertise of administrative officials.[24]
Petitioner contends that Sec. 16[25] of R.A. No. 8177 is uncertain as to
which "court" will fix the time and date of execution, and the date of
execution and time of notification of the death convict. As petitioner already
knows, the "court" which designates the date of execution is the trial court
which convicted the accused, that is, after this Court has reviewed the entire
records of the case[26] and has affirmed the judgment of the lower

court. Thereupon, the procedure is that the "judgment is entered fifteen (15)
days after its promulgation, and 10 days thereafter, the records are
remanded to the court below including a certified copy of the judgment for
execution.[27] Neither is there any uncertainty as to the date of execution nor
the time of notification. As to the date of execution, Section 15 of the
implementing rules must be read in conjunction with the last sentence of
Section 1 of R.A. No. 8177 which provides that the death sentence shall be
carried out "not earlier than one (1) year nor later then eighteen (18)
months from the time the judgment imposing the death penalty became
final and executory, without prejudice to the exercise by the President of his
executive clemency powers at all times." Hence, the death convict is in effect
assured of eighteen (18) months from the time the judgment imposing the
death penalty became final and executory [28] wherein he can seek executive
clemency[29] and attend to all his temporal and spiritual affairs.[30]
Petitioner further contends that the infliction of "wanton pain" in case of
possible complications in the intravenous injection, considering and as
petitioner claims, that respondent Director is an untrained and untested
person insofar as the choice and administration of lethal injection is
concerned, renders lethal injection a cruel, degrading and inhuman
punishment. Such supposition is highly speculative and unsubstantiated.
First. Petitioner has neither alleged nor presented evidence that lethal
injection required the expertise only of phlebotomists and not trained
personnel and that the drugs to be administered are unsafe or ineffective.
[31]
Petitioner simply cites situations in the United States wherein execution
by lethal injection allegedly resulted in prolonged and agonizing death for
the convict,[32] without any other evidence whatsoever.
Second. Petitioner overlooked Section 1, third paragraph of R.A. No.
8177 which requires that all personnel involved in the execution proceedings
should be trained prior to the performance of such task. We must presume
that the public officials entrusted with the implementation of the death
penalty (by lethal injection) will carefully avoid inflicting cruel punishment. [33]
Third. Any infliction of pain in lethal injection is merely incidental in
carrying out the execution of death penalty and does not fall within the
constitutional proscription against cruel, degrading and inhuman
punishment. "In a limited sense, anything is cruel which is calculated to give

pain or distress, and since punishment imports pain or suffering to the

convict, it may be said that all punishments are cruel. But of course the
Constitution does not mean that crime, for this reason, is to go
unpunished."[34] The cruelty against which the Constitution protects a
convicted man is cruelty inherent in the method of punishment, not the
necessary suffering involved in any method employed to extinguish life
humanely.[35] Numerous federal and state courts of the United States have
been asked to review whether lethal injections constitute cruel and unusual
punishment. No court has found lethal injections to implicate prisoner's
Eighth Amendment rights. In fact, most courts that have addressed the issue
state in one or two sentences that lethal injection clearly is a constitutional
form of execution.[36] A few jurisdictions, however, have addressed the merits
of the Eighth Amendment claims. Without exception, these courts have
found that lethal injection does not constitute cruel and unusual
punishment. After reviewing the medical evidence that indicates that
improper doses or improper administration of the drugs causes severe pain
and that prison officials tend to have little training in the administration of
the drugs, the courts have found that the few minutes of pain does not rise
to a constitutional violation.[37]
What is cruel and unusual "is not fastened to the obsolete but may
acquire meaning as public opinion becomes enlightened by a humane
justice" and "must draw its meaning from the evolving standards of decency
that mark the progress of a maturing society." [38] Indeed, "[o]ther (U.S.)
courts have focused on 'standards of decency' finding that the widespread
use of lethal injections indicates that it comports with contemporary
norms."[39] the primary indicator of society's standard of decency with regard
to capital punishment is the response of the country's legislatures to the
sanction.[40] Hence, for as long as the death penalty remains in our statute
books and meets the most stringent requirements provided by the
Constitution, we must confine our inquiry to the legality of R.A. No. 8177,
whose constitutionality we duly sustain in the face of petitioner's
challenge. We find that the legislature's substitution of the mode of carrying
out the death penalty from electrocution to lethal injection infringes no
constitutional rights of petitioner herein.
II. REIMPOSITION OF THE DEATH PENALTY LAW DOES NOT VIOLATE
INTERNATIONAL TREATY OBLIGATIONS

Petitioner assiduously argues that the reimposition of the death penalty

law violates our international obligations, in particular, the International
Covenant on Civil And Political Rights, which was adopted by the General
Assembly of the United Nations on December 16, 1996, signed and ratified
by the Philippines on December 19, 1966 and October 23, 1986,
[41]
respectively.
Article 6 of
Rights provides:

the International

Covenant

on

Civil

and

Political

"1. Every human being has the inherent right to life. This right shall
be protected by law. No one shall be arbitrarily deprived of his life.
2. In countries which have not abolished the death penalty,
sentence of death may be imposed only for the most serious
crimes in accordance with the law in force at the time of the
commission of the crime and not contrary to the provisions of the
present Covenant and to the Convention on the Prevention and
Punishment of the Crime of Genocide. This penalty can only be
carried out pursuant to a final judgment rendered by a competent
court." (emphasis supplied)
3. When deprivation of life constitutes the crime of genocide, it is
understood that nothing in this article shall authorize any State
Party to the present Covenant to derogate in any way from any
obligation assumed under the provisions of the Convention on the
Prevention and Punishment of the Crime of Genocide.
4. Anyone sentenced to death shall have the right to seek pardon or
commutation of the sentence. Amnesty, pardon or commutation of
the sentence of death may be granted in all-cases.
5. Sentence of death shall not be imposed for crimes committed by
persons below eighteen years of age and shall not be carried out on
pregnant women.

6. Nothing in this article shall be invoked to delay or to prevent the

abolition of capital punishment by any State. Party to the present
Covenant."
Indisputably, Article 6 of the Covenant enshrines the individual's right to
life. Nevertheless, Article 6 (2) of theCovenant explicitly recognizes that
capital punishment is an allowable limitation on the right to life, subject to
the limitation that it be imposed for the "most serious crimes". Pursuant to
Article 28 of the Covenant, a Human Rights Committee was established and
under Article 40 of the Covenant, State parties to the Covenant are required
to submit an initial report to the Committee on the measures they have
adopted which give effect to the rights recognized within the Covenant and
on the progress made on the enjoyment of those rights one year of its entry
into force for the State Party concerned and thereafter, after five years. On
July 27, 1982, the Human Rights Committee issued General Comment No.
6 interpreting Article 6 of the Covenant stating that "(while) it follows from
Article 6 (2) to (6) that State parties are not obliged to abolish the death
penalty totally, they are obliged to limit its use and, in particular, to abolish it
for other than the 'most serious crimes.' Accordingly, they ought to consider
reviewing their criminal laws in this light and, in any event, are obliged to
restrict the application of the death penalty to the most serious crimes.' The
article strongly suggests (pars. 2 (2) and (6) that abolition is desirable. xxx
The Committee is of the opinion that the expression 'most serious crimes'
must be read restrictively to mean that the death penalty should be a quite
exceptional measure." Further, the Safeguards Guaranteeing Protection of
Those Facing the Death Penalty[42] adopted by the Economic and Social
Council of the United Nations declare that the ambit of the term 'most
serious crimes' should not go beyond intentional crimes, with lethal or other
extremely grave consequences.
The Optional Protocol to the International Covenant on Civil and Political
Rights was adopted by the General Assembly of the United Nations on
December 16, 1966, and signed and ratified by the Philippines on December
19,
1966
and
August
22,
1989, [43] respectively. The Optional
Protocol provides that the Human Rights Committee shall receive and
consider communications from individuals claiming to be victims of violations
of any of the rights set forth in the Covenant.

On the other hand, the Second Optional Protocol to the International

Covenant on Civil and Political Rights, Aiming at the Abolition of the Death
Penalty was adopted by the General Assembly on December 15, 1989. The
Philippines neither signed nor ratified said document.[44] Evidently,
petitioner's assertion of our obligation under the Second Optional Protocol is
misplaced.
III. THERE IS NO UNDUE DELEGATION OF LEGISLATIVE POWER IN R.A.
NO. 8177 TO THE SECRETARY OF JUSTICE AND THE DIRECTOR OF
BUREAU OF CORRECTIONS, BUT SECTION 19 OF THE RULES AND
REGULATIONS TO IMPLEMENT R.A. NO. 8177 IS INVALID.

The separation of powers is a fundamental principle in our system of

government. It obtains not through express provision but by actual division
in the framing of our Constitution. Each department of the government has
exclusive cognizance of matters placed within its jurisdiction, and is supreme
within its own sphere.[45] Corollary to the doctrine of separation of powers is
the principle of non-delegation of powers. "The rule is that what has been
delegated, cannot be delegated or as expressed in a Latin maxim: potestas
delegata non delegari potest."[46] The recognized exceptions to the rule are as
follows:
(1) Delegation of tariff powers to the President under Section 28 (2) of
Article VI of the Constitution;
(2) Delegation of emergency powers to the President under Section 23 (2)
of Article VI of the Constitution;
(3) Delegation to the people at large;
(4) Delegation to local governments; and
(5) Delegation to administrative bodies.[47]

Empowering the Secretary of Justice in conjunction with the Secretary of

Health and the Director of the Bureau of Corrections, to promulgate rules
and regulations on the subject of lethal injection is a form of delegation of
legislative authority to administrative bodies.
The reason for delegation of authority to administrative agencies is the
increasing complexity of the task of government requiring expertise as well

as the growing inability of the legislature to cope directly with the myriad
problems demanding its attention. The growth of society has ramified its
activities and created peculiar and sophisticated problems that the
legislature cannot be expected to attend to by itself. Specialization even in
legislation has become necessary. On many problems involving day-to-day
undertakings, the legislature may not have the needed competence to
provide the required direct and efficacious, not to say, specific
solutions. These solutions may, however, be expected from its delegates,
who are supposed to be experts in the particular fields assigned to them. [48]
Although Congress may delegate to another branch of the Government
the power to fill in the details in the execution, enforcement or
administration of a law, it is essential, to forestall a violation of the principle
of separation of powers, that said law: (a) be complete in itself - it must set
forth therein the policy to be executed, carried out or implemented by the
delegate[49] - and (b) fix a standard - the limits of which are sufficiently
determinate or determinable - to which the delegate must conform in the
performance of his functions.[50]
Considering the scope and the definiteness of R.A. No. 8177, which
changed the mode of carrying out the death penalty, the Court finds that the
law sufficiently describes what job must be done, who is to do it, and what is
the scope of his authority.[51]
R.A. No. 8177 likewise provides the standards which define the
legislative policy, mark its limits, map out its boundaries, and specify the
public agencies which will apply it. it indicates the circumstances under
which the legislative purpose may be carried out. [52] R.A. No. 8177
specifically requires that "[t]he death sentence shall be executed under the
authority of the Director of the Bureau of Corrections, endeavoring so far
as possible to mitigate the sufferings of the person under the
sentence during the lethal injection as well as during the
proceedings prior to the execution."[53] Further, "[t]he Director of the
Bureau of Corrections shall take steps to ensure that the lethal injection
to be administered is sufficient to cause the instantaneous death of
the convict."[54] The legislature also mandated that "all personnel
involved in the administration of lethal injection shall be trained
prior to the performance of such task."[55] The Court cannot see that any
useful purpose would be served by requiring greater detail. [56] The question

raised is not the definition of what constitutes a criminal offense, [57] but the
mode of carrying out the penalty already imposed by the Courts. In this
sense, R.A. No. 8177 is sufficiently definite and the exercise of discretion by
the administrative officials concerned is, to use the words of Justice
Benjamin Cardozo, canalized within banks that keep it from overflowing.
Thus, the Court finds that the existence of an area for exercise of
discretion by the Secretary of Justice and the Director of the Bureau of
Corrections under delegated legislative power is proper where standards are
formulated for the guidance and the exercise of limited discretion, which
though general, are capable of reasonable application. [58]
It is also noteworthy that Article 81 of the Revised Penal Code which
originally provided for the death penalty by electrocution was not subjected
to attack on the ground that it failed to provide for details such as the kind
of chair to be used, the amount of voltage, volume of amperage or place of
attachment of electrodes on the death convict. Hence, petitioner's analogous
argument with respect to lethal injection must fail.
A careful reading of R.A. No. 8177 would show that there is no undue
delegation of legislative power from the Secretary of Justice to the Director
of the Bureau of Corrections for the simple reason that under the
Administrative Code of 1987, the Bureau of Corrections is a mere constituent
unit of the Department of Justice. [59] Further, the Department of Justice is
tasked, among others, to take charge of the "administration of the
correctional system."[60]Hence, the import of the phraseology of the law is
that the Secretary of Justice should supervise the Director of the Bureau of
Corrections in promulgating the Lethal Injection Manual, in consultation with
the Department of Health.[61]
However, the Rules and Regulations to Implement Republic Act No. 8177
suffer serious flaws that could not be overlooked. To begin with, something
basic appears missing in Section 19 of the implementing rules which
provides:

"SEC. 19. EXECUTION PROCEDURE. - Details of the

procedure prior to, during and after administering the lethal
injection shall be set forth in a manual to be prepared by the
Director. The manual shall contain details of, among others, the

sequence of events before and after execution; procedures in

setting up the intravenous line; the administration of the lethal
drugs; the pronouncement of death; and the removal of the
intravenous system.
Said manual shall be confidential and its distribution shall be
limited to authorized prison personnel."
Thus, the Courts finds in the first paragraph of Section 19 of the
implementing rules a veritable vacuum. The Secretary of Justice has
practically abdicated the power to promulgate the manual on the execution
procedure to the Director of the Bureau of Corrections, by not providing for a
mode of review and approval thereof. Being a mere constituent unit of the
Department of Justice, the Bureau of Corrections could not promulgate a
manual that would not bear the imprimatur of the administrative superior,
the Secretary of Justice as the rule-making authority under R.A. No.
8177. Such apparent abdication of departmental responsibility renders the
said paragraph invalid.
As to the second paragraph of section 19, the Court finds the
requirement of confidentiality of the contents of the manual even with
respect to the convict unduly suppressive. It sees no legal impediment for
the convict, should he so desire, to obtain a copy of the manual. The
contents of the manual are matters of public concern "which the public may
want to know, either because these directly affect their lives, or simply
because such matters naturally arouse the interest of an ordinary
citizen."[62] Section 7 of Article III of the 1987 Constitution provides:

"SEC. 7. 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, transaction,
or decisions, as well as to government research data used as a
basis for policy development, shall be afforded the citizen,
subject to such limitation as may be provided by law."
The incorporation in the Constitution of a guarantee of access to
information of public concern is a recognition of the essentiality of the free
flow of ideas and information in a democracy.[63] In the same way that free

discussion enables members of society to cope with the exigencies of their

time,[64] access to information of general interest aids the people in
democratic decision-making[65] by giving them a better perspective of the
vital issues confronting the nation.[66]
D. SECTION 17 OF THE RULES AND REGULATIONS TO IMPLEMENT R.A. NO.
8177 IS INVALID FOR BEING DISCRIMINATORY AND CONTRARY TO LAW.

Even more seriously flawed than

implementing rules which provides:

Section

19

is

Section

of

the

"SEC. 17. SUSPENSION OF THE EXECUTION OF THE DEATH

SENTENCE. Execution by lethal injection shall not be inflicted
upon a woman within the three years next following the date of
the sentence or while she is pregnant, nor upon any person over
seventy (70) years of age. In this latter case, the death penalty
shall be commuted to the penalty of reclusion perpetua with the
accessory penalties provided in Article 40 of the Revised Penal
Code."
Petitioner contends that Section 17 is unconstitutional for being
discriminatory as well as for being an invalid exercise of the power to
legislate by respondent Secretary. Petitioner insists that Section 17 amends
the instances when lethal injection may be suspended, without an express
amendment of Article 83 of the Revised Penal Code, as amended by section
25 of R.A. No. 7659.
Article 83 f the Revised Penal Code, as amended by section 25 of R.A.
No. 7659 now reads as follows:

"ART. 83, Suspension of the execution of the death sentence.The death sentence shall not be inflicted upon a woman while
she is pregnant or within one (1) year after delivery, nor upon
any person over seventy years of age.In this last case, the death
sentence shall be commuted to the penalty of reclusion perpetua
with the accessory penalty provided in Article 40. x x x".

On this point, the Courts finds petitioner's contention impressed with

merit. While Article 83 of the Revised Penal Code, as amended by Section 25
of Republic Act No. 7659, suspends the implementation of the death
penalty while a woman is pregnant or within one (1) year after
delivery, Section 17 of the implementing rules omits the one (1) year
period following delivery as an instance when the death sentence is
suspended, and adds a ground for suspension of sentence no longer found
under Article 83 of the Revised Penal Code as amended, which is the threeyear reprieveafter a woman is sentenced. This addition is, in petitioner's
view, tantamount to a gender-based discrimination sans statutory basis,
while the omission is an impermissible contravention of the applicable law.
Being merely an implementing rule, Section 17 aforecited must not
override, but instead remain consistent and in harmony with the law it seeks
to apply and implement. Administrative rules and regulations are intended to
carry out, neither to supplant nor to modify, the law." [67] An administrative
agency cannot amend an act of Congress. [68] In case of discrepancy between
a provision of statute and a rule or regulation issued to implement said
statute, the statutory provision prevails. Since the cited clause in Section 17
which suspends the execution of a woman within the three (3) years next
following the date of sentence finds no supports in Article 83 of the Revised
Penal Code as amended, perforce Section 17 must be declared invalid.
One member of the Court voted to declare Republic Act. No. 8177 as
unconstitutional insofar as it delegates the power to make rules over the
same subject matter to two persons (the Secretary of Justice and the
Director of the Bureau of Corrections) and constitutes a violation of the
international norm towards the abolition of the death penalty.One member of
the Court, consistent with his view in People v. Echegaray, 267 SCRA 682,
734-758 (1997) that the death penalty law (Republic Act. No. 7659) is itself
unconstitutional, believes that Republic Act No. 8177 which provides for the
means of carrying out the death sentence, is likewise unconstitutional. Two
other members of the court concurred in the aforesaid Separate Opinions in
that the death penalty law (Republic Act No. 7659) together with the
assailed statute (Republic Act No. 8177) are unconstitutional. In sum, four
members of the Court voted to declare Republic Act. No. 8177 as
unconstitutional. These Separate Opinions are hereto annexed, infra.

WHEREFORE, the petition is DENIED insofar as petitioner seeks to

declare the assailed statute (Republic Act No. 8177) as unconstitutional;
but GRANTED insofar as Sections 17 and 19 of the Rules and Regulations to
Implement Republic Act No. 8177 are concerned, which are hereby
declared INVALID because (a) Section 17 contravenes Article 83 of the
Revised Penal Code, as amended by Section 25 of the Republic Act No.
7659; and (b) Section 19 fails to provide for review and approval of the
Lethal Injection Manual by the Secretary of Justice, and unjustifiably makes
the manual confidential, hence unavailable to interested parties including the
accused/convict and counsel. Respondents are hereby enjoined from
enforcing and implementing Republic Act No. 8177 until the aforesaid
Sections 17 and 19 of the Rules and Regulations to Implement Republic Act
No. 8177 are appropriately amended, revised and/or corrected in accordance
with this Decision.
NO COSTS.
SO ORDERED.

G.R. No. L-9820

August 30, 1957

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellant,

vs.
PEDRO R. EXCONDE defendant-appellant.
Office of the Solicitor General Ambrosio Padilla and Assistant Solicitor
General Ramon L. Avancea for plaintiff-appellant.
Sotero H. Laurel and Leo C. Caro for defendant-appellant.
REYES, J.B.L., J.:

The accused Pedro R. Exconde was convicted in the Court of First

Instance of Manila of violating Central Bank Circular No. 37, approved
September 25,1952, limiting to P100 the amount of Philippine
currency that an outgoing passenger could have on his person. The
court below meted upon him a sentence four (4) months of
imprisonment and fine of P100 and costs.
The facts are not disputed. On May 5, 1954, the appellant Pedro R.
Exconde was on board the s.s. President Wilson, as one of its
passengers bound for Japan Supervising agent Jose A. Fojas of the
Department of Finance, found in Exconde's possession P5,090 in
Philippine currency, plus U.S. $50 in cash; travelers' checks for $100;
and a Bank of America remitter's receipt for $350. Admittedly
Exconde's possession of the P5,000 was not licensed, and was in
violation of Central Bank Circular No. 37 (48 Off. Gaz. 3823) providing
as follows:
SECTION 1. Pursuant to section 34 of Republic Act No. 265 the
Monetary Board is hereby promulgating this circular. Violation of
any of its provisions shall subject the offender to the penal
provisions of said Act.
SEC. 2. The import and export of Philippine coins and notes
without the necessary license issued by the Central Bank is
prohibited except in the following cases:
(a) Travellers entering the Philippines may bring in Philippine
coins and notes in an amount not exceeding P100, provided the
coins do not exceed P50. In case of travelers arriving on ships,
the coins they bring in, shall not exceed P50 for first class
passengers, P20 for second class passengers and P10 for third
class passengers.
(b) Travelers leaving the Philippines may take with them
Philippine coins and notes in an amount not exceeding P100,
provided the coins do not exceed P5.

SEC. 3. The following shall also be held liable within the meaning
of this circular:
(a) Any outgoing passengers already booked and ready to leave
the country found having in his person or among his luggage, at
the airport or piers, an amount exceeding P100 or Philippine
coins exceeding P5 when no license has been previously obtained
for the excess amount.
(b) The sender of any mail matter, envelope, or package already
deposited in the mails, manifested or put on board an outgoing
international carrier found to contain an amount exceeding P100
when no license has been previously obtained for the excess
amount.
SEC. 4. All circulars, notifications or regulations previously
promulgated by the Monetary Board inconsistent herewith are
hereby repealed.
SEC. 5. This circular shall take effect immediately.
The aforesaid circular was promulgated in connection with sec. 34 of
Republic Act 265 (Central Bank Act) providing that:
SEC. 34. Proceedings upon violation of laws and regulations.
Whenever any person or entity willfully violates this Act or any
order, instruction, rule or regulation legally issued by the
Monetary Board, the person or persons responsible for such
violation shall be punished by a fine of not more than twenty
thousand pesos and by imprisonment of not more than five
years.
Whenever a banking institution persists in violating its chartered
or by-laws or any law, or orders, instructions, rules or regulations
legally issued by the Monetary Board, or whenever a banking
institution persist in carrying on its business in as unlawful or
unsafe manner, the Board shall, by the Solicitor General, and

without prejudice to the penalties provided in the preceding

paragraph of this section, file a petition in the Court of First
Instance praying the assistance of the court to compel the
banking institution to discontinue the violations or practices
objected to in the petition of the Board. The Monetary Board
may, with the approval of the court, take such action as the court
may deem necessary to compel the banking institution
complained against to discontinue the violations or practices set
forth in the Board's petition, and, if necessary, the Board may,
under order of the court, direct the Superintendent of Banks to
liquidate the business of the institution.
Two appeals were taken from the decision of the trial court and are
submitted to us for decision. One is the appeal perfected by Exconde,
who alleges that Circular No. 37 is invalid, and the other is the appeal
taken by the Government from the lower court's refusal to order the
confiscation of the P5,000.00 unauthorizedly held by Exconde and
found in his possession by agent Fojas.
The first argument of appellant Exconde is that sec. 34 of the Central
Bank can not validate the issuance of Circular No. 37 because sec. 34
refers solely to regulations under Art. IV, Chapter B of the Act,
concerning activities of the "Department of Supervision and
Examination" of banking institutions.
We see no merit in this contention. The first paragraph of sec. 34,
heretofore quoted, is so broad in terms that it was evidently designed
to establish penal sanctions for any and all violations of the Act as well
as of the regulations legally issued by the Monetary Board; and there
being no other sanctioning provision elsewhere in the Act itself,
appellant's stand, if upheld, would lead to the result that, with the
exception of Art. IV, Chapter B, all other provisions of the Central Bank
Act could be violated with impunity. That effect the law could not have
intended.

It is next argued that sec. 14 of the Central Bank Law does not grant
authority to the Monetary Board to prohibit the exportation of
Philippine currency, and that if any such authority was in fact granted,
the same is void as an, invalid delegation of legislative power. Section
14 is as follows:
SEC. 14. Exercise of authority In order to exercise the
authority granted to it under this Act, the Monetary Board shall:
(a) Prepare and issue such rules and regulations as it considers
necessary for the effective discharge of the responsibilities and
exercise of the powers assigned to the Monetary Board and to
the Central Bank under this Act;
(b) Direct the management, operations and administration of the
Central Bank and prepare such rules and regulations as it may
deem necessary or convenient for this purpose;
(c) On the recommendation of the Governor, appoint, fix the
renumerations, and remove all officers and employees of the
Central Bank, with the exception of the Governor; and
(d) Authorize such expenditures by the Central Bank as are in the
interest of the effective administration and operation of the Bank.
It is well established in this jurisdiction that, while the making of laws
is a non-delegable activity that corresponds exclusively to Congress,
nevertheless the latter may constitutionally delegate authority to
promulgate rules and regulations to implement a given legislation and
effectuate its policies, for the reason that the legislature often finds it
impracticable (if not impossible) to anticipate and provide for the
multifarious and complex situations that may be met in carrying the
law into effect. All that is required is that the regulation should be
germane to the objects and purposes of the law; that the regulation be
not in contradiction with it, but conform to the standards that the law
prescribes (Calalang vs. Williams, 70 Phil. 727; Pangasinan
Transportation vs. Public Service Commission, 70 Phil. 22; Peo. vs.

Rosenthal, 68 Phil. 328; Peo. vs. Vera, 39 Phil. 660; Rubi vs. Prov.
Board of Mindoro, 39 Phil. 660).
In the case of People vs. Rosenthal and Osmea, G.R. Nos.
46076 and 46077, promulgated June 12, 1939,1 and
in Pangasinan Transportation vs. The Public Service Commission,
G.R. No. 47065, promulgated June 26, 1940,2 this Court had
occasion to observe that the principle of separation of powers has
been made to adapt itself to the complexities of modern
governments, giving rise to the adoption, within certain limits, of
the principle of subordinate legislation, not only in the United
States and England but in practically all modern governments.
Accordingly, with the growing complexity of modern life, the
multiplication of the subjects of governmental regulations, and
the increased difficulty of administering the laws, the rigidity of
the theory of separation of governmental powers has, to a large
extent, been relaxed by permitting the delegation of greater
powers by the legislative and vesting a larger amount of
discretion in administrative and executive officials, not only in the
execution of the laws, but also in the promulgation of certain
rules and regulations calculated to promote public interest.
Considering that the "responsibilities and powers" assigned to the
Bank and its Monetary Board, mentioned in sec 14 (a), are those
specified in sec. 2 of the Act:
SEC. 2. Responsibilities and objectives. It shall be the
responsibility of the Central Bank of the Philippines to administer
the monetary and banking system of the Republic.
It shall be the duty of the Central Bank to use powers granted to
it under this Act to achieve the following objectives:
(a) To maintain monetary stability in the Philippines;

(b) To preserve the international value of the peso and the

convertibility of the peso into other freely convertible currencies;
and
(c) To promote a rising level of production, employment and real
income in the Philippines.
as well as those prescribed in sec. 64 of same law, to wit:
SEC. 64. Guiding principle. The Monetary Board shall endeavor
to control any expansion or contraction in the supply, or any rise
or fall in prices, which, in the opinion of the Board, is prejudicial
to the attainment or maintenance of a high level of production,
employment, and real income. In adopting policies and measures
in accordance with this principle the Monetary Board shall have
due regard for their effects on the availability and cost of money
to particular sectors of the economy as well as to the economy as
a whole, and their effects on the relationship of domestic prices
and costs to world prices and costs,
we experience no difficulty in concluding that Circular No. 37 here in
question was a valid exercise of the regulatory power delegated by the
Central Bank Act, and that said Circular is in harmony with the
objectives sought to be achieved by that law, particularly the control of
any prejudicial "expansion and contraction of the money supply" (sec.
64) and "the preservation of the international value of the peso" (sec.
2, par. b). It requires no effort to understand that unless the
exportation of currency is curtailed, the value of the peso in terms of
other currencies can not be maintained, for the increase of the peso
supply in foreign countries would tend to depress its value therein.
How far the limitation should go may give rise to honest differences of
opinion, but the power to restrict the export of Philippine currency is
undoubtedly there, and courts are only concerned with the question of
authority, not the wisdom of the measure involved.

Appellants does not dispute that the objectives set forth in secs. 2 and
64 of the Central Bank Act constitute adequate standards to guide the
Bank and the Monetary Board; nor may doubt be entertained on that
score, specially when compared to those criteria upon which this Court
has previously affixed the stamp of its approval, like "public welfare"
(Cardoa vs. Binangonan, 37 Phil. 547); "necessary in the interest of
law and order" (Rubi vs. Provincial Board, 39 Phil, 660) public interest"
(People vs. Rosenthal, 68 Phil. 328);"justice and equity and the
substantial merits of the case" (Int. Hardwood vs. Pagil Fed. of Labor,
70 Phil. 602).
Having reached these conclusions, we must likewise assent to the
proposition that the violation of Circular No. 37 comes within the penal
sanctions of the Central Bank Act; because a violation or infringement
of a rule or regulation validly issued can constitute a misdemeanor or a
crime punishable as provided in the authorizing statute, and by virtue
of the latter.
. . ., the regulations adopted under legislative authority by a
particular department must be in harmony with the provisions of
the law, and for the sole purpose of carrying into effect its
general provisions. By such regulations, of course, the law itself
can not be extended. So long, however, as the regulations relate
solely to carrying into effect the provisions of the law, they are
valid. A violation of a regulation prescribed by an executive
officer of the Government in conformity with and based upon a
statute authorizing such regulation, constitutes an offense and
renders the offender liable to punishment in accordance with the
provisions of law. (United States vs. Bailey, 9 Pet., 238, 252,
254, 256; Caha vs. United States, 152 U. S., 211, 218, United
States vs. Eaton, 144 U.S., 677), (U.S. vs. Tupasi, Molina, 29
Phil. 124)
The legislature cannot delegate to a board or to an executive
officer the power to declare what acts shall constitute a criminal
offense. It is competent for it, however, to authorize a

commission to prescribe duties on which the law may operate in

imposing a penalty and in effectuating the purpose designed in
enacting the law. There are numerous cases in which the courts
have sustained statutes authorizing administrative officers to
promulgate rules on a specified subject and providing that a
violation of such rules or orders should constitute a
misdemeanor, punishable as provided in the statute. (11 Am. Jur.
pp. 965-966)
Where statutes provide that violation of a rule or regulation of an
administrative agency shall be a misdemeanor, if the rule or
regulation is reasonable, the enforcement of the penalty for its
violation is sustained by the courts, for the legislature and not
the administrative agency made the action penal. (Vol. 1,
Sutherland Statutory Construction, p. 92).
Turning now to the State's appeal, it is apparent that the refusal of the
court below to order the confiscation of the unlicensed found in the
possession of the accused Exconde is contrary to the provisions of Art.
10 of the Revised Penal Code, that read as follows:
ART. 10. Offenses not subject to the provisions of the Code.
Offenses which are or in the future may be punishable under
special laws are not subject to the provisions of this Code. This
Code shall be supplementary to such laws, unless the latter
should specially provide the contrary.
Pursuant to this rule, Art. 45 of the Penal Code (providing for the
confiscation or forfeiture of the instruments or tools employed in the
commission of a crime) has repeatedly been applied to crimes
penalized by special laws, in default of a contrary mandate therein.
Such a course was adopted in U.S. vs. Bruhez, 28 Phil. 305, involving
a violation of the Opium Law; U.S. vs. Filart, 30 Phil. 80 (infraction of
the lottery act, No. 1757); Villaruz vs. Court of First Instance, 71 Phil.
72 (usury); Commissioner of Customs vs. Sadia, 95 Phil., 439, 50 Off.
Gaz. 3560 (violation of the Revised Administrative Code).

In the case of U.S. Bruhez, supra, this Court affirmed the confiscation
of seven P500-peso bills delivered to a customs official in consideration
of his allowing an illegal importation of opium, and considered the
money as an instrument for the commission of the crime. Similarly,
in Commissioner of Customs vs. Encarnacion, we held that dutiable
articles imported without having been declared as required by law
should be declared forfeited to the Government under Art. 45 of the
Revised Penal Code.
If in People vs. Paet, 53 Off. Gaz. 668, and People vs. Sanchez, supra,
745, this Court refused to entertain the Government's appeal from the
refusal of the Court of First Instance to decree such a forfeiture, it did
so, not because Article 45 of the Penal Code did not apply, but
exclusively on the ground that in a criminal case wherein the accused
had not appealed, no appeal can be interposed by the Government
with a view to increasing the penalty imposed by the court below; and
confiscation being an additional penalty, the accused would be placed
twice in jeopardy of punishment for the same offense, should the
Government's appeal be entertained. But in the present case of
accused Exconde, his own appeal has removed all bars to the review
and correction of the penalty imposed by the court below, even if an
increase thereof should be the result. (Rule 120, sec. 11)
Summing up, we hold: (1) that Circular No. 37, issued by the
Monetary Board of the Central Bank, is valid exercise of the regulatory
power constitutionally delegated to the same under the terms of the
Central Bank Act (Rep. Act No. 265); (2) that violations of said circular
are punishable as criminal offenses under the provisions of the first
paragraph of section 34 of said Act; and (3) that, pursuant to Article
10 of the Revised Penal Code, Art. 45 of the said code applies to
criminal proceedings for violations of the Central Bank Act or of the
regulations validly issued in accordance with the same.
Wherefore the judgment appealed from is therefore modified by
ordering that the unlicensed money found in the possession of the
appellant Exconde be declared forfeited to the Government. In all

other respects, the appealed judgment is affirmed. Costs against the

accused appellant Pedro R. Exconde. So ordered.

G.R. No. 76633 October 18, 1988

EASTERN SHIPPING LINES, INC., petitioner,
vs.
PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION
(POEA), MINISTER OF LABOR AND EMPLOYMENT, HEARING
OFFICER ABDUL BASAR and KATHLEEN D. SACO, respondents.
Jimenea, Dala & Zaragoza Law Office for petitioner.
The Solicitor General for public respondent.
Dizon Law Office for respondent Kathleen D. Saco.

CRUZ, J.:
The private respondent in this case was awarded the sum of
P192,000.00 by the Philippine Overseas Employment Administration
(POEA) for the death of her husband. The decision is challenged by the
petitioner on the principal ground that the POEA had no jurisdiction
over the case as the husband was not an overseas worker.
Vitaliano Saco was Chief Officer of the M/V Eastern Polaris when he
was killed in an accident in Tokyo, Japan, March 15, 1985. His widow
sued for damages under Executive Order No. 797 and Memorandum
Circular No. 2 of the POEA. The petitioner, as owner of the vessel,
argued that the complaint was cognizable not by the POEA but by the
Social Security System and should have been filed against the State
Insurance Fund. The POEA nevertheless assumed jurisdiction and after
considering the position papers of the parties ruled in favor of the
complainant. The award consisted of P180,000.00 as death benefits
and P12,000.00 for burial expenses.

The petitioner immediately came to this Court, prompting the Solicitor

General to move for dismissal on the ground of non-exhaustion of
administrative remedies.
Ordinarily, the decisions of the POEA should first be appealed to the
National Labor Relations Commission, on the theory inter alia that the
agency should be given an opportunity to correct the errors, if any, of
its subordinates. This case comes under one of the exceptions,
however, as the questions the petitioner is raising are essentially
questions of law. 1 Moreover, the private respondent himself has not objected to the
petitioner's direct resort to this Court, observing that the usual procedure would delay the
disposition of the case to her prejudice.

The Philippine Overseas Employment Administration was created under

Executive Order No. 797, promulgated on May 1, 1982, to promote
and monitor the overseas employment of Filipinos and to protect their
rights. It replaced the National Seamen Board created earlier under
Article 20 of the Labor Code in 1974. Under Section 4(a) of the said
executive order, the POEA is vested with "original and exclusive
jurisdiction over all cases, including money claims, involving employeeemployer relations arising out of or by virtue of any law or contract
involving Filipino contract workers, including seamen." These cases,
according to the 1985 Rules and Regulations on Overseas Employment
issued by the POEA, include "claims for death, disability and other
benefits" arising out of such employment. 2
The petitioner does not contend that Saco was not its employee or that
the claim of his widow is not compensable. What it does urge is that
he was not an overseas worker but a 'domestic employee and
consequently his widow's claim should have been filed with Social
Security System, subject to appeal to the Employees Compensation
Commission.
We see no reason to disturb the factual finding of the POEA that
Vitaliano Saco was an overseas employee of the petitioner at the time
he met with the fatal accident in Japan in 1985.

Under the 1985 Rules and Regulations on Overseas Employment,

overseas employment is defined as "employment of a worker outside
the Philippines, including employment on board vessels plying
international waters, covered by a valid contract. 3 A contract worker is
described as "any person working or who has worked overseas under a valid employment
contract and shall include seamen" 4 or "any person working overseas or who has been
employed by another which may be a local employer, foreign employer, principal or partner
under a valid employment contract and shall include seamen." 5 These definitions clearly
apply to Vitaliano Saco for it is not disputed that he died while under a contract of
employment with the petitioner and alongside the petitioner's vessel, the M/V Eastern
Polaris, while berthed in a foreign country.

It is worth observing that the petitioner performed at least two acts

which constitute implied or tacit recognition of the nature of Saco's
employment at the time of his death in 1985. The first is its
submission of its shipping articles to the POEA for processing,
formalization and approval in the exercise of its regulatory power over
overseas employment under Executive Order NO. 797. 7 The second is its
payment 8 of the contributions mandated by law and regulations to the Welfare Fund for
Overseas Workers, which was created by P.D. No. 1694 "for the purpose of providing social
and welfare services to Filipino overseas workers."

Significantly, the office administering this fund, in the receipt it

prepared for the private respondent's signature, described the subject
of the burial benefits as "overseas contract worker Vitaliano
Saco." 9 While this receipt is certainly not controlling, it does indicate, in the light of the
petitioner's own previous acts, that the petitioner and the Fund to which it had made
contributions considered Saco to be an overseas employee.

The petitioner argues that the deceased employee should be likened to

the employees of the Philippine Air Lines who, although working
abroad in its international flights, are not considered overseas workers.
If this be so, the petitioner should not have found it necessary to
submit its shipping articles to the POEA for processing, formalization
and approval or to contribute to the Welfare Fund which is available
only to overseas workers. Moreover, the analogy is hardly appropriate
as the employees of the PAL cannot under the definitions given be
considered seamen nor are their appointments coursed through the
POEA.

The award of P180,000.00 for death benefits and P12,000.00 for burial
expenses was made by the POEA pursuant to its Memorandum Circular
No. 2, which became effective on February 1, 1984. This circular
prescribed a standard contract to be adopted by both foreign and
domestic shipping companies in the hiring of Filipino seamen for
overseas employment. A similar contract had earlier been required by
the National Seamen Board and had been sustained in a number of
cases by this Court. 10 The petitioner claims that it had never entered into such a
contract with the deceased Saco, but that is hardly a serious argument. In the first place, it
should have done so as required by the circular, which specifically declared that "all parties
to the employment of any Filipino seamen on board any ocean-going vessel are advised to
adopt and use this employment contract effective 01 February 1984 and to desist from
using any other format of employment contract effective that date." In the second place,
even if it had not done so, the provisions of the said circular are nevertheless deemed
written into the contract with Saco as a postulate of the police power of the State.

11

But the petitioner questions the validity of Memorandum Circular No. 2

itself as violative of the principle of non-delegation of legislative power.
It contends that no authority had been given the POEA to promulgate
the said regulation; and even with such authorization, the regulation
represents an exercise of legislative discretion which, under the
principle, is not subject to delegation.
The authority to issue the said regulation is clearly provided in Section
4(a) of Executive Order No. 797, reading as follows:
... The governing Board of the Administration (POEA), as
hereunder provided shall promulgate the necessary rules
and regulations to govern the exercise of the adjudicatory
functions of the Administration (POEA).
Similar authorization had been granted the National Seamen Board,
which, as earlier observed, had itself prescribed a standard shipping
contract substantially the same as the format adopted by the POEA.
The second challenge is more serious as it is true that legislative
discretion as to the substantive contents of the law cannot be
delegated. What can be delegated is the discretion to

determine how the law may be enforced, notwhat the law shall be. The
ascertainment of the latter subject is a prerogative of the legislature.
This prerogative cannot be abdicated or surrendered by the legislature
to the delegate. Thus, in Ynot v. Intermediate Apellate Court 12 which
annulled Executive Order No. 626, this Court held:

We also mark, on top of all this, the questionable manner of

the disposition of the confiscated property as prescribed in
the questioned executive order. It is there authorized that
the seized property shall be distributed to charitable
institutions and other similar institutions as the Chairman of
the National Meat Inspection Commission may see fit, in the
case of carabaos.' (Italics supplied.) The phrase "may see
fit" is an extremely generous and dangerous condition, if
condition it is. It is laden with perilous opportunities for
partiality and abuse, and even corruption. One searches in
vain for the usual standard and the reasonable guidelines,
or better still, the limitations that the officers must observe
when they make their distribution. There is none. Their
options are apparently boundless. Who shall be the
fortunate beneficiaries of their generosity and by what
criteria shall they be chosen? Only the officers named can
supply the answer, they and they alone may choose the
grantee as they see fit, and in their own exclusive
discretion. Definitely, there is here a 'roving commission a
wide and sweeping authority that is not canalized within
banks that keep it from overflowing,' in short a clearly
profligate and therefore invalid delegation of legislative
powers.
There are two accepted tests to determine whether or not there is a
valid delegation of legislative power, viz, the completeness test and the
sufficient standard test. Under the first test, the law must be complete
in all its terms and conditions when it leaves the legislature such that
when it reaches the delegate the only thing he will have to do is
enforce it. 13 Under the sufficient standard test, there must be adequate guidelines or

stations in the law to map out the boundaries of the delegate's authority and prevent the
delegation from running riot.

14

Both tests are intended to prevent a total transference of legislative

authority to the delegate, who is not allowed to step into the shoes of
the legislature and exercise a power essentially legislative.
The principle of non-delegation of powers is applicable to all the three
major powers of the Government but is especially important in the
case of the legislative power because of the many instances when its
delegation is permitted. The occasions are rare when executive or
judicial powers have to be delegated by the authorities to which they
legally certain. In the case of the legislative power, however, such
occasions have become more and more frequent, if not necessary. This
had led to the observation that the delegation of legislative power has
become the rule and its non-delegation the exception.
The reason is the increasing complexity of the task of government and
the growing inability of the legislature to cope directly with the myriad
problems demanding its attention. The growth of society has ramified
its activities and created peculiar and sophisticated problems that the
legislature cannot be expected reasonably to comprehend.
Specialization even in legislation has become necessary. To many of
the problems attendant upon present-day undertakings, the legislature
may not have the competence to provide the required direct and
efficacious, not to say, specific solutions. These solutions may,
however, be expected from its delegates, who are supposed to be
experts in the particular fields assigned to them.
The reasons given above for the delegation of legislative powers in
general are particularly applicable to administrative bodies. With the
proliferation of specialized activities and their attendant peculiar
problems, the national legislature has found it more and more
necessary to entrust to administrative agencies the authority to issue
rules to carry out the general provisions of the statute. This is called
the "power of subordinate legislation."

With this power, administrative bodies may implement the broad

policies laid down in a statute by "filling in' the details which the
Congress may not have the opportunity or competence to provide. This
is effected by their promulgation of what are known as supplementary
regulations, such as the implementing rules issued by the Department
of Labor on the new Labor Code. These regulations have the force and
effect of law.
Memorandum Circular No. 2 is one such administrative regulation. The
model contract prescribed thereby has been applied in a significant
number of the cases without challenge by the employer. The power of
the POEA (and before it the National Seamen Board) in requiring the
model contract is not unlimited as there is a sufficient standard guiding
the delegate in the exercise of the said authority. That standard is
discoverable in the executive order itself which, in creating the
Philippine Overseas Employment Administration, mandated it to
protect the rights of overseas Filipino workers to "fair and equitable
employment practices."
Parenthetically, it is recalled that this Court has accepted as sufficient
standards "Public interest" in People v. Rosenthal 15 "justice and equity"
in Antamok Gold Fields v. CIR

16

"public convenience and welfare" in Calalang v.

17

Williams
and "simplicity, economy and efficiency" in Cervantes v. Auditor General, 18 to
mention only a few cases. In the United States, the "sense and experience of men" was
accepted in Mutual Film Corp. v. Industrial Commission,
in Hirabayashi v. United States.

19

and "national security"

20

It is not denied that the private respondent has been receiving a

monthly death benefit pension of P514.42 since March 1985 and that
she was also paid a P1,000.00 funeral benefit by the Social Security
System. In addition, as already observed, she also received a
P5,000.00 burial gratuity from the Welfare Fund for Overseas Workers.
These payments will not preclude allowance of the private
respondent's claim against the petitioner because it is specifically
reserved in the standard contract of employment for Filipino seamen
under Memorandum Circular No. 2, Series of 1984, that

Section C. Compensation and Benefits.

1. In case of death of the seamen during the term of his
Contract, the employer shall pay his beneficiaries the
amount of:
a. P220,000.00 for master and chief engineers
b. P180,000.00 for other officers, including radio
operators and master electrician
c. P 130,000.00 for ratings.
2. It is understood and agreed that the benefits mentioned
above shall be separate and distinct from, and will be in
addition to whatever benefits which the seaman is entitled
to under Philippine laws. ...
3. ...
c. If the remains of the seaman is buried in the
Philippines, the owners shall pay the
beneficiaries of the seaman an amount not
exceeding P18,000.00 for burial expenses.
The underscored portion is merely a reiteration of Memorandum
Circular No. 22, issued by the National Seamen Board on July 12,1976,
providing an follows:
Income Benefits under this Rule Shall be Considered
Additional Benefits.
All compensation benefits under Title II, Book Four of the
Labor Code of the Philippines (Employees Compensation
and State Insurance Fund) shall be granted, in addition to
whatever benefits, gratuities or allowances that the seaman
or his beneficiaries may be entitled to under the
employment contract approved by the NSB. If applicable, all

benefits under the Social Security Law and the Philippine

Medicare Law shall be enjoyed by the seaman or his
beneficiaries in accordance with such laws.
The above provisions are manifestations of the concern of the State for
the working class, consistently with the social justice policy and the
specific provisions in the Constitution for the protection of the working
class and the promotion of its interest.
One last challenge of the petitioner must be dealt with to close t case.
Its argument that it has been denied due process because the same
POEA that issued Memorandum Circular No. 2 has also sustained and
applied it is an uninformed criticism of administrative law itself.
Administrative agencies are vested with two basic powers, the quasilegislative and the quasi-judicial. The first enables them to promulgate
implementing rules and regulations, and the second enables them to
interpret and apply such regulations. Examples abound: the Bureau of
Internal Revenue adjudicates on its own revenue regulations, the
Central Bank on its own circulars, the Securities and Exchange
Commission on its own rules, as so too do the Philippine Patent Office
and the Videogram Regulatory Board and the Civil Aeronautics
Administration and the Department of Natural Resources and so on ad
infinitumon their respective administrative regulations. Such an
arrangement has been accepted as a fact of life of modern
governments and cannot be considered violative of due process as
long as the cardinal rights laid down by Justice Laurel in the landmark
case of Ang Tibay v. Court of Industrial Relations 21 are observed.
Whatever doubts may still remain regarding the rights of the parties in
this case are resolved in favor of the private respondent, in line with
the express mandate of the Labor Code and the principle that those
with less in life should have more in law.
When the conflicting interests of labor and capital are weighed on the
scales of social justice, the heavier influence of the latter must be
counter-balanced by the sympathy and compassion the law must

accord the underprivileged worker. This is only fair if he is to be given

the opportunity and the right to assert and defend his cause not as a
subordinate but as a peer of management, with which he can
negotiate on even plane. Labor is not a mere employee of capital but
its active and equal partner.
WHEREFORE, the petition is DISMISSED, with costs against the
petitioner. The temporary restraining order dated December 10, 1986
is hereby LIFTED. It is so ordered.
Narvasa, Gancayco, Grio-Aquino and Medialdea, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 115381 December 23, 1994

KILUSANG MAYO UNO LABOR CENTER, petitioner,
vs.
HON. JESUS B. GARCIA, JR., the LAND TRANSPORTATION
FRANCHISING AND REGULATORY BOARD, and the PROVINCIAL
BUS OPERATORS ASSOCIATION OF THE
PHILIPPINES, respondents.
Potenciano A. Flores for petitioner.
Robert Anthony C. Sison, Cesar B. Brillantes and Jose Z. Galsim for
private respondent.
Jose F. Miravite for movants.

KAPUNAN, J.:

Public utilities are privately owned and operated businesses whose

service are essential to the general public. They are enterprises which
specially cater to the needs of the public and conduce to their comfort
and convenience. As such, public utility services are impressed with
public interest and concern. The same is true with respect to the
business of common carrier which holds such a peculiar relation to the
public interest that there is superinduced upon it the right of public
regulation when private properties are affected with public interest,
hence, they cease to be juris privati only. When, therefore, one
devotes his property to a use in which the public has an interest, he, in
effect grants to the public an interest in that use, and must submit to
the control by the public for the common good, to the extent of the
interest he has thus created. 1
An abdication of the licensing and regulatory government agencies of
their functions as the instant petition seeks to show, is indeed
lamentable. Not only is it an unsound administrative policy but it is
inimical to public trust and public interest as well.
The instant petition for certiorari assails the constitutionality and
validity of certain memoranda, circulars and/or orders of the
Department of Transportation and Communications (DOTC) and the
Land Transportation Franchising and Regulatory Board LTFRB) 2 which,
among others, (a) authorize provincial bus and jeepney operators to increase or decrease
the prescribed transportation fares without application therefor with the LTFRB and without
hearing and approval thereof by said agency in violation of Sec. 16(c) of Commonwealth Act
No. 146, as amended, otherwise known as the Public Service Act, and in derogation of
LTFRB's duty to fix and determine just and reasonable fares by delegating that function to
bus operators, and (b) establish a presumption of public need in favor of applicants for
certificates of public convenience (CPC) and place on the oppositor the burden of proving
that there is no need for the proposed service, in patent violation not only of Sec. 16(c) of
CA 146, as amended, but also of Sec. 20(a) of the same Act mandating that fares should be
"just and reasonable." It is, likewise, violative of the Rules of Court which places upon each
party the burden to prove his own affirmative allegations. 3 The offending provisions
contained in the questioned issuances pointed out by petitioner, have resulted in the
introduction into our highways and thoroughfares thousands of old and smoke-belching
buses, many of which are right-hand driven, and have exposed our consumers to the
burden of spiraling costs of public transportation without hearing and due process.

The following memoranda, circulars and/or orders are sought to be

nullified by the instant petition, viz: (a) DOTC Memorandum Order 90395, dated June 26, 1990 relative to the implementation of a fare
range scheme for provincial bus services in the country; (b) DOTC
Department Order No.
92-587, dated March 30, 1992, defining the policy framework on the
regulation of transport services; (c) DOTC Memorandum dated October
8, 1992, laying down rules and procedures to implement Department
Order No. 92-587; (d) LTFRB Memorandum Circular No. 92-009,
providing implementing guidelines on the DOTC Department Order No.
92-587; and (e) LTFRB Order dated March 24, 1994 in Case No. 943112.
The relevant antecedents are as follows:
On June 26, 1990; then Secretary of DOTC, Oscar M. Orbos, issued
Memorandum Circular No. 90-395 to then LTFRB Chairman, Remedios
A.S. Fernando allowing provincial bus operators to charge passengers
rates within a range of 15% above and 15% below the LTFRB official
rate for a period of one (1) year. The text of the memorandum order
reads in full:
One of the policy reforms and measures that is in line with
the thrusts and the priorities set out in the Medium-Term
Philippine Development Plan (MTPDP) 1987 1992) is the
liberalization of regulations in the transport sector. Along
this line, the Government intends to move away gradually
from regulatory policies and make progress towards greater
reliance on free market forces.
Based on several surveys and observations, bus companies
are already charging passenger rates above and below the
official fare declared by LTFRB on many provincial routes. It
is in this context that some form of liberalization on public
transport fares is to be tested on a pilot basis.

In view thereof, the LTFRB is hereby directed to

immediately publicize a fare range scheme for all provincial
bus routes in country (except those operating within Metro
Manila). Transport Operators shall be allowed to charge
passengers within a range of fifteen percent (15%) above
and fifteen percent (15%) below the LTFRB official rate for
a period of one year.
Guidelines and procedures for the said scheme shall be
prepared by LTFRB in coordination with the DOTC Planning
Service.
The implementation of the said fare range scheme shall
start on 6 August 1990.
For compliance. (Emphasis ours.)
Finding the implementation of the fare range scheme "not legally
feasible," Remedios A.S. Fernando submitted the following
memorandum to Oscar M. Orbos on July 24, 1990, to wit:
With reference to DOTC Memorandum Order No. 90-395
dated 26 June 1990 which the LTFRB received on 19 July
1990, directing the Board "to immediately publicize a fare
range scheme for all provincial bus routes in the country
(except those operating within Metro Manila)" that will allow
operators "to charge passengers within a range of fifteen
percent (15%) above and fifteen percent (15%) below the
LTFRB official rate for a period of one year" the undersigned
is respectfully adverting the Secretary's attention to the
following for his consideration:
1. Section 16(c) of the Public Service Act
prescribes the following for the fixing and
determination of rates (a) the rates to be
approved should be proposed by public service
operators; (b) there should be a publication and

notice to concerned or affected parties in the

territory affected; (c) a public hearing should be
held for the fixing of the rates; hence,
implementation of the proposed fare range
scheme on August 6 without complying with the
requirements of the Public Service Act may not
be legally feasible.
2. To allow bus operators in the country to
charge fares fifteen (15%) above the present
LTFRB fares in the wake of the devastation,
death and suffering caused by the July 16
earthquake will not be socially warranted and will
be politically unsound; most likely public
criticism against the DOTC and the LTFRB will be
triggered by the untimely motu
propio implementation of the proposal by the
mere expedient of publicizing the fare range
scheme without calling a public hearing, which
scheme many as early as during the Secretary's
predecessor know through newspaper reports
and columnists' comments to be Asian
Development Bank and World Bank inspired.
3. More than inducing a reduction in bus fares by
fifteen percent (15%) the implementation of the
proposal will instead trigger an upward
adjustment in bus fares by fifteen percent (15%)
at a time when hundreds of thousands of people
in Central and Northern Luzon, particularly in
Central Pangasinan, La Union, Baguio City,
Nueva Ecija, and the Cagayan Valley are
suffering from the devastation and havoc caused
by the recent earthquake.

4. In lieu of the said proposal, the DOTC with its

agencies involved in public transportation can
consider measures and reforms in the industry
that will be socially uplifting, especially for the
people in the areas devastated by the recent
earthquake.
In view of the foregoing considerations, the undersigned
respectfully suggests that the implementation of the
proposed fare range scheme this year be further studied
and evaluated.
On December 5, 1990, private respondent Provincial Bus Operators
Association of the Philippines, Inc. (PBOAP) filed an application for fare
rate increase. An across-the-board increase of eight and a half
centavos (P0.085) per kilometer for all types of provincial buses with a
minimum-maximum fare range of fifteen (15%) percent over and
below the proposed basic per kilometer fare rate, with the said
minimum-maximum fare range applying only to ordinary, first class
and premium class buses and a fifty-centavo (P0.50) minimum per
kilometer fare for aircon buses, was sought.
On December 6, 1990, private respondent PBOAP reduced its applied
proposed fare to an across-the-board increase of six and a half
(P0.065) centavos per kilometer for ordinary buses. The decrease was
due to the drop in the expected price of diesel.
The application was opposed by the Philippine Consumers Foundation,
Inc. and Perla C. Bautista alleging that the proposed rates were
exorbitant and unreasonable and that the application contained no
allegation on the rate of return of the proposed increase in rates.
On December 14, 1990, public respondent LTFRB rendered a decision
granting the fare rate increase in accordance with the following
schedule of fares on a straight computation method, viz:
AUTHORIZED FARES

LUZON
MIN. OF 5 KMS. SUCCEEDING KM.
REGULAR P1.50 P0.37
STUDENT P1.15 P0.28
VISAYAS/MINDANAO
REGULAR P1.60 P0.375
STUDENT P1.20 P0.285
FIRST CLASS (PER KM.)
LUZON P0.385
VISAYAS/
MINDANAO P0.395
PREMIERE CLASS (PER KM.)
LUZON P0.395
VISAYAS/
MINDANAO P0.405
AIRCON (PER KM.) P0.415. 4
On March 30, 1992, then Secretary of the Department of
Transportation and Communications Pete Nicomedes Prado issued
Department Order No.
92-587 defining the policy framework on the regulation of transport
services. The full text of the said order is reproduced below in view of
the importance of the provisions contained therein:
WHEREAS, Executive Order No. 125 as amended,
designates the Department of Transportation and
Communications (DOTC) as the primary policy, planning,
regulating and implementing agency on transportation;
WHEREAS, to achieve the objective of a viable, efficient,
and dependable transportation system, the transportation
regulatory agencies under or attached to the DOTC have to

harmonize their decisions and adopt a common philosophy

and direction;
WHEREAS, the government proposes to build on the
successful liberalization measures pursued over the last five
years and bring the transport sector nearer to a balanced
longer term regulatory framework;
NOW, THEREFORE, pursuant to the powers granted by laws
to the DOTC, the following policies and principles in the
economic regulation of land, air, and water transportation
services are hereby adopted:
1. Entry into and exit out of the industry. Following the
Constitutional dictum against monopoly, no franchise holder
shall be permitted to maintain a monopoly on any route. A
minimum of two franchise holders shall be permitted to
operate on any route.
The requirements to grant a certificate to operate, or
certificate of public convenience, shall be: proof of Filipino
citizenship, financial capability, public need, and sufficient
insurance cover to protect the riding public.
In determining public need, the presumption of need for a
service shall be deemed in favor of the applicant. The
burden of proving that there is no need for a proposed
service shall be with the oppositor(s).
In the interest of providing efficient public transport
services, the use of the "prior operator" and the "priority of
filing" rules shall be discontinued. The route measured
capacity test or other similar tests of demand for
vehicle/vessel fleet on any route shall be used only as a
guide in weighing the merits of each franchise application
and not as a limit to the services offered.

Where there are limitations in facilities, such as congested

road space in urban areas, or at airports and ports, the use
of demand management measures in conformity with
market principles may be considered.
The right of an operator to leave the industry is recognized
as a business decision, subject only to the filing of
appropriate notice and following a phase-out period, to
inform the public and to minimize disruption of services.
2. Rate and Fare Setting. Freight rates shall be freed
gradually from government controls. Passenger fares shall
also be deregulated, except for the lowest class of
passenger service (normally third class passenger
transport) for which the government will fix indicative or
reference fares. Operators of particular services may fix
their own fares within a range 15% above and below the
indicative or reference rate.
Where there is lack of effective competition for services, or
on specific routes, or for the transport of particular
commodities, maximum mandatory freight rates or
passenger fares shall be set temporarily by the government
pending actions to increase the level of competition.
For unserved or single operator routes, the government
shall contract such services in the most advantageous
terms to the public and the government, following public
bids for the services. The advisability of bidding out the
services or using other kinds of incentives on such routes
shall be studied by the government.
3. Special Incentives and Financing for Fleet Acquisition. As
a matter of policy, the government shall not engage in
special financing and incentive programs, including direct
subsidies for fleet acquisition and expansion. Only when the

market situation warrants government intervention shall

programs of this type be considered. Existing programs
shall be phased out gradually.
The Land Transportation Franchising and Regulatory Board,
the Civil Aeronautics Board, the Maritime Industry Authority
are hereby directed to submit to the Office of the Secretary,
within forty-five (45) days of this Order, the detailed rules
and procedures for the Implementation of the policies
herein set forth. In the formulation of such rules, the
concerned agencies shall be guided by the most recent
studies on the subjects, such as the Provincial Road
Passenger Transport Study, the Civil Aviation Master Plan,
the Presidential Task Force on the Inter-island Shipping
Industry, and the Inter-island Liner Shipping Rate
Rationalization Study.
For the compliance of all concerned. (Emphasis ours)
On October 8, 1992, public respondent Secretary of the Department of
Transportation and Communications Jesus B. Garcia, Jr. issued a
memorandum to the Acting Chairman of the LTFRB suggesting swift
action on the adoption of rules and procedures to implement abovequoted Department Order No. 92-587 that laid down deregulation and
other liberalization policies for the transport sector. Attached to the
said memorandum was a revised draft of the required rules and
procedures covering (i) Entry Into and Exit Out of the Industry and (ii)
Rate and Fare Setting, with comments and suggestions from the World
Bank incorporated therein. Likewise, resplendent from the said
memorandum is the statement of the DOTC Secretary that the
adoption of the rules and procedures is a pre-requisite to the approval
of the Economic Integration Loan from the World Bank. 5
On February 17, 1993, the LTFRB issued Memorandum Circular
No. 92-009 promulgating the guidelines for the implementation of

DOTC Department Order No. 92-587. The Circular provides, among

others, the following challenged portions:
xxx xxx xxx
IV. Policy Guidelines on the Issuance of Certificate of Public
Convenience.
The issuance of a Certificate of Public Convenience is
determined by public need. The presumption of public need
for a service shall be deemed in favor of the applicant,
while burden of proving that there is no need for the
proposed service shall be the oppositor'(s).
xxx xxx xxx
V. Rate and Fare Setting
The control in pricing shall be liberalized to introduce price
competition complementary with the quality of service,
subject to prior notice and public hearing. Fares shall not be
provisionally authorized without public hearing.
A. On the General Structure of Rates
1. The existing authorized fare range system of plus or
minus 15 per cent for provincial buses and jeepneys shall
be widened to 20% and -25% limit in 1994 with the
authorized fare to be replaced by an indicative or reference
rate as the basis for the expanded fare range.
2. Fare systems for aircon buses are liberalized to cover
first class and premier services.
xxx xxx xxx
(Emphasis ours).

Sometime in March, 1994, private respondent PBOAP, availing itself of

the deregulation policy of the DOTC allowing provincial bus operators
to collect plus 20% and minus 25% of the prescribed fare without first
having filed a petition for the purpose and without the benefit of a
public hearing, announced a fare increase of twenty (20%) percent of
the existing fares. Said increased fares were to be made effective on
March 16, 1994.
On March 16, 1994, petitioner KMU filed a petition before the LTFRB
opposing the upward adjustment of bus fares.
On March 24, 1994, the LTFRB issued one of the assailed orders
dismissing the petition for lack of merit. The dispositive portion reads:
PREMISES CONSIDERED, this Board after considering the
arguments of the parties, hereby DISMISSES FOR LACK OF
MERIT the petition filed in the above-entitled case. This
petition in this case was resolved with dispatch at the
request of petitioner to enable it to immediately avail of the
legal remedies or options it is entitled under existing laws.
SO ORDERED. 6
Hence, the instant petition for certiorari with an urgent prayer for
issuance of a temporary restraining order.
The Court, on June 20, 1994, issued a temporary restraining order
enjoining, prohibiting and preventing respondents from implementing
the bus fare rate increase as well as the questioned orders and
memorandum circulars. This meant that provincial bus fares were
rolled back to the levels duly authorized by the LTFRB prior to March
16, 1994. A moratorium was likewise enforced on the issuance of
franchises for the operation of buses, jeepneys, and taxicabs.
Petitioner KMU anchors its claim on two (2) grounds. First, the
authority given by respondent LTFRB to provincial bus operators to set
a fare range of plus or minus fifteen (15%) percent, later increased to

plus twenty (20%) and minus twenty-five (-25%) percent, over and
above the existing authorized fare without having to file a petition for
the purpose, is unconstitutional, invalid and illegal. Second, the
establishment of a presumption of public need in favor of an applicant
for a proposed transport service without having to prove public
necessity, is illegal for being violative of the Public Service Act and the
Rules of Court.
In its Comment, private respondent PBOAP, while not actually touching
upon the issues raised by the petitioner, questions the wisdom and the
manner by which the instant petition was filed. It asserts that the
petitioner has no legal standing to sue or has no real interest in the
case at bench and in obtaining the reliefs prayed for.
In their Comment filed by the Office of the Solicitor General, public
respondents DOTC Secretary Jesus B. Garcia, Jr. and the LTFRB
asseverate that the petitioner does not have the standing to maintain
the instant suit. They further claim that it is within DOTC and LTFRB's
authority to set a fare range scheme and establish a presumption of
public need in applications for certificates of public convenience.
We find the instant petition impressed with merit.
At the outset, the threshold issue of locus standi must be struck.
Petitioner KMU has the standing to sue.
The requirement of locus standi inheres from the definition of judicial
power. Section 1 of Article VIII of the Constitution provides:
xxx xxx xxx
Judicial power includes the duty of the courts of justice to
settle actual controversies involving rights which are legally
demandable and enforceable, and to determine whether or
not there has been a grave abuse of discretion amounting
to lack or excess of jurisdiction on the part of any branch or
instrumentality of the Government.

In Lamb v. Phipps, 7 we ruled that judicial power is the power to hear and decide
causes pending between parties who have the right to sue in the courts of law and equity.
Corollary to this provision is the principle of locus standi of a party litigant. One who is
directly affected by and whose interest is immediate and substantial in the controversy has
the standing to sue. The rule therefore requires that a party must show a personal stake in
the outcome of the case or an injury to himself that can be redressed by a favorable
decision so as to warrant an invocation of the court's jurisdiction and to justify the exercise
of the court's remedial powers in his behalf. 8

In the case at bench, petitioner, whose members had suffered and

continue to suffer grave and irreparable injury and damage from the
implementation of the questioned memoranda, circulars and/or orders,
has shown that it has a clear legal right that was violated and
continues to be violated with the enforcement of the challenged
memoranda, circulars and/or orders. KMU members, who avail of the
use of buses, trains and jeepneys everyday, are directly affected by
the burdensome cost of arbitrary increase in passenger fares. They are
part of the millions of commuters who comprise the riding public.
Certainly, their rights must be protected, not neglected nor ignored.
Assuming arguendo that petitioner is not possessed of the standing to
sue, this court is ready to brush aside this barren procedural infirmity
and recognize the legal standing of the petitioner in view of the
transcendental importance of the issues raised. And this act of
liberality is not without judicial precedent. As early as theEmergency
Powers Cases, this Court had exercised its discretion and waived the
requirement of proper party. In the recent case of Kilosbayan, Inc., et
al. v. Teofisto Guingona, Jr., et al., 9 we ruled in the same lines and enumerated
some of the cases where the same policy was adopted, viz:

. . . A party's standing before this Court is a procedural

technicality which it may, in the exercise of its discretion,
set aside in view of the importance of the issues raised. In
the landmark Emergency Powers Cases, [G.R. No. L-2044
(Araneta v. Dinglasan); G.R. No. L-2756 (Araneta
v. Angeles); G.R. No. L-3054 (Rodriguez v. Tesorero de
Filipinas); G.R. No. L-3055 (Guerrero v. Commissioner of
Customs); and G.R. No. L-3056 (Barredo v. Commission on

Elections), 84 Phil. 368 (1949)], this Court brushed aside

this technicality because "the transcendental importance to
the public of these cases demands that they be settled
promptly and definitely, brushing aside, if we must,
technicalities of procedure. (Avelino vs. Cuenco, G.R. No. L2621)." Insofar as taxpayers' suits are concerned, this
Court had declared that it "is not devoid of discretion as to
whether or not it should be entertained," (Tan v. Macapagal,
43 SCRA 677, 680 [1972]) or that it "enjoys an open
discretion to entertain the same or not." [Sanidad v.
COMELEC, 73 SCRA 333 (1976)].
xxx xxx xxx
In line with the liberal policy of this Court on locus standi,
ordinary taxpayers, members of Congress, and even
association of planters, and
non-profit civic organizations were allowed to initiate and
prosecute actions before this court to question the
constitutionality or validity of laws, acts, decisions, rulings,
or orders of various government agencies or
instrumentalities. Among such cases were those assailing
the constitutionality of (a) R.A. No. 3836 insofar as it allows
retirement gratuity and commutation of vacation and sick
leave to Senators and Representatives and to elective
officials of both Houses of Congress (Philippine Constitution
Association, Inc. v. Gimenez, 15 SCRA 479 [1965]); (b)
Executive Order No. 284, issued by President Corazon C.
Aquino on 25 July 1987, which allowed members of the
cabinet, their undersecretaries, and assistant secretaries to
hold other government offices or positions (Civil Liberties
Union v. Executive Secretary, 194 SCRA 317 [1991]); (c)
the automatic appropriation for debt service in the General
Appropriations Act (Guingona v. Carague, 196 SCRA 221
[1991]; (d) R.A. No. 7056 on the holding of desynchronized
elections (Osmea v. Commission on Elections, 199 SCRA

750 [1991]); (e) P.D. No. 1869 (the charter of the

Philippine Amusement and Gaming Corporation) on the
ground that it is contrary to morals, public policy, and order
(Basco v. Philippine Amusement and Gaming Corp., 197
SCRA 52 [1991]); and (f) R.A. No. 6975, establishing the
Philippine National Police. (Carpio v. Executive Secretary,
206 SCRA 290 [1992]).
Other cases where we have followed a liberal policy
regarding locus standi include those attacking the validity or
legality of (a) an order allowing the importation of rice in
the light of the prohibition imposed by R.A. No. 3452 (Iloilo
Palay and Corn Planters Association, Inc. v. Feliciano, 13
SCRA 377 [1965]; (b) P.D. Nos. 991 and 1033 insofar as
they proposed amendments to the Constitution and P.D. No.
1031 insofar as it directed the COMELEC to supervise,
control, hold, and conduct the referendum-plebiscite on 16
October 1976 (Sanidad v. Commission on Elections, supra);
(c) the bidding for the sale of the 3,179 square meters of
land at Roppongi, Minato-ku, Tokyo, Japan (Laurel v.
Garcia, 187 SCRA 797 [1990]); (d) the approval without
hearing by the Board of Investments of the amended
application of the Bataan Petrochemical Corporation to
transfer the site of its plant from Bataan to Batangas and
the validity of such transfer and the shift of feedstock from
naphtha only to naphtha and/or liquefied petroleum gas
(Garcia v. Board of Investments, 177 SCRA 374 [1989];
Garcia v. Board of Investments, 191 SCRA 288 [1990]); (e)
the decisions, orders, rulings, and resolutions of the
Executive Secretary, Secretary of Finance, Commissioner of
Internal Revenue, Commissioner of Customs, and the Fiscal
Incentives Review Board exempting the National Power
Corporation from indirect tax and duties (Maceda v.
Macaraig, 197 SCRA 771 [1991]); (f) the orders of the
Energy Regulatory Board of 5 and 6 December 1990 on the
ground that the hearings conducted on the second

provisional increase in oil prices did not allow the petitioner

substantial cross-examination; (Maceda v. Energy
Regulatory Board, 199 SCRA 454 [1991]); (g) Executive
Order No. 478 which levied a special duty of P0.95 per liter
of imported oil products (Garcia v. Executive Secretary, 211
SCRA 219 [1992]); (h) resolutions of the Commission on
Elections concerning the apportionment, by district, of the
number of elective members of Sanggunians (De Guia vs.
Commission on Elections, 208 SCRA 420 [1992]); and (i)
memorandum orders issued by a Mayor affecting the Chief
of Police of Pasay City (Pasay Law and Conscience Union,
Inc. v. Cuneta, 101 SCRA 662 [1980]).
In the 1975 case of Aquino v. Commission on Elections (62
SCRA 275 [1975]), this Court, despite its unequivocal ruling
that the petitioners therein had no personality to file the
petition, resolved nevertheless to pass upon the issues
raised because of the far-reaching implications of the
petition. We did no less in De Guia v. COMELEC
(Supra) where, although we declared that De Guia "does
not appear to have locus standi, a standing in law, a
personal or substantial interest," we brushed aside the
procedural infirmity "considering the importance of the
issue involved, concerning as it does the political exercise of
qualified voters affected by the apportionment, and
petitioner alleging abuse of discretion and violation of the
Constitution by respondent."
Now on the merits of the case.
On the fare range scheme.
Section 16(c) of the Public Service Act, as amended, reads:
Sec. 16. Proceedings of the Commission, upon notice and
hearing. The Commission shall have power, upon proper

notice and hearing in accordance with the rules and

provisions of this Act, subject to the limitations and
exceptions mentioned and saving provisions to the
contrary:
xxx xxx xxx
(c) To fix and determine individual or joint rates, tolls,
charges, classifications, or schedules thereof, as well as
commutation, mileage kilometrage, and other special rates
which shall be imposed, observed, and followed thereafter
by any public service: Provided, That the Commission may,
in its discretion, approve rates proposed by public services
provisionally and without necessity of any hearing; but it
shall call a hearing thereon within thirty days thereafter,
upon publication and notice to the concerns operating in the
territory affected: Provided, further, That in case the public
service equipment of an operator is used principally or
secondarily for the promotion of a private business, the net
profits of said private business shall be considered in
relation with the public service of such operator for the
purpose of fixing the rates. (Emphasis ours).
xxx xxx xxx
Under the foregoing provision, the Legislature delegated to the
defunct Public Service Commission the power of fixing the rates
of public services. Respondent LTFRB, the existing regulatory
body today, is likewise vested with the same under Executive
Order No. 202 dated June 19, 1987. Section 5(c) of the said
executive order authorizes LTFRB "to determine, prescribe,
approve and periodically review and adjust, reasonable fares,
rates and other related charges, relative to the operation of
public land transportation services provided by motorized
vehicles."

Such delegation of legislative power to an administrative agency is

permitted in order to adapt to the increasing complexity of modern
life. As subjects for governmental regulation multiply, so does the
difficulty of administering the laws. Hence, specialization even in
legislation has become necessary. Given the task of determining
sensitive and delicate matters as
route-fixing and rate-making for the transport sector, the responsible
regulatory body is entrusted with the power of subordinate legislation.
With this authority, an administrative body and in this case, the LTFRB,
may implement broad policies laid down in a statute by "filling in" the
details which the Legislature may neither have time or competence to
provide. However, nowhere under the aforesaid provisions of law are
the regulatory bodies, the PSC and LTFRB alike, authorized to delegate
that power to a common carrier, a transport operator, or other public
service.
In the case at bench, the authority given by the LTFRB to the
provincial bus operators to set a fare range over and above the
authorized existing fare, is illegal and invalid as it is tantamount to an
undue delegation of legislative authority. Potestas delegata non
delegari potest. What has been delegated cannot be delegated. This
doctrine is based on the ethical principle that such a delegated power
constitutes not only a right but a duty to be performed by the delegate
through the instrumentality of his own judgment and not through the
intervening mind of another. 10 A further delegation of such power would indeed
constitute a negation of the duty in violation of the trust reposed in the delegate mandated
to discharge it directly. 11 The policy of allowing the provincial bus operators to change and
increase their fares at will would result not only to a chaotic situation but to an anarchic
state of affairs. This would leave the riding public at the mercy of transport operators who
may increase fares every hour, every day, every month or every year, whenever it pleases
them or whenever they deem it "necessary" to do so. In Panay Autobus Co. v. Philippine
Railway Co., 12 where respondent Philippine Railway Co. was granted by the Public Service
Commission the authority to change its freight rates at will, this Court categorically declared
that:

In our opinion, the Public Service Commission was not

authorized by law to delegate to the Philippine Railway Co.
the power of altering its freight rates whenever it should

find it necessary to do so in order to meet the competition

of road trucks and autobuses, or to change its freight rates
at will, or to regard its present rates as maximum rates,
and to fix lower rates whenever in the opinion of the
Philippine Railway Co. it would be to its advantage to do so.
The mere recital of the language of the application of the
Philippine Railway Co. is enough to show that it is
untenable. The Legislature has delegated to the Public
Service Commission the power of fixing the rates of public
services, but it has not authorized the Public Service
Commission to delegate that power to a common carrier or
other public service. The rates of public services like the
Philippine Railway Co. have been approved or fixed by the
Public Service Commission, and any change in such rates
must be authorized or approved by the Public Service
Commission after they have been shown to be just and
reasonable. The public service may, of course, propose new
rates, as the Philippine Railway Co. did in case No. 31827,
but it cannot lawfully make said new rates effective without
the approval of the Public Service Commission, and the
Public Service Commission itself cannot authorize a public
service to enforce new rates without the prior approval of
said rates by the commission. The commission must
approve new rates when they are submitted to it, if the
evidence shows them to be just and reasonable, otherwise
it must disapprove them. Clearly, the commission cannot
determine in advance whether or not the new rates of the
Philippine Railway Co. will be just and reasonable, because
it does not know what those rates will be.
In the present case the Philippine Railway Co. in effect
asked for permission to change its freight rates at will. It
may change them every day or every hour, whenever it
deems it necessary to do so in order to meet competition or
whenever in its opinion it would be to its advantage. Such a

procedure would create a most unsatisfactory state of

affairs and largely defeat the purposes of the public service
law. 13 (Emphasis ours).
One veritable consequence of the deregulation of transport fares is
a compounded fare. If transport operators will be authorized to impose
and collect an additional amount equivalent to 20% over and above
the authorized fare over a period of time, this will unduly prejudice a
commuter who will be made to pay a fare that has been computed in a
manner similar to those of compounded bank interest rates.
Picture this situation. On December 14, 1990, the LTFRB authorized
provincial bus operators to collect a thirty-seven (P0.37) centavo per
kilometer fare for ordinary buses. At the same time, they were allowed
to impose and collect a fare range of plus or minus 15% over the
authorized rate. Thus P0.37 centavo per kilometer authorized fare plus
P0.05 centavos (which is 15% of P0.37 centavos) is equivalent to
P0.42 centavos, the allowed rate in 1990. Supposing the LTFRB grants
another five (P0.05) centavo increase per kilometer in 1994, then, the
base or reference for computation would have to be P0.47 centavos
(which is P0.42 + P0.05 centavos). If bus operators will exercise their
authority to impose an additional 20% over and above the authorized
fare, then the fare to be collected shall amount to P0.56 (that is, P0.47
authorized LTFRB rate plus 20% of P0.47 which is P0.29). In effect,
commuters will be continuously subjected, not only to a double fare
adjustment but to a compounding fare as well. On their part, transport
operators shall enjoy a bigger chunk of the pie. Aside from fare
increase applied for, they can still collect an additional amount by
virtue of the authorized fare range. Mathematically, the situation
translates into the following:
Year** LTFRB authorized Fare Range Fare to be
rate*** collected per
kilometer

1990
1994
1998
2002

P0.37
P0.42
P0.56
P0.73

15% (P0.05) P0.42

+ 0.05 = 0.47 20% (P0.09) P0.56
+ 0.05 = 0.61 20% (P0.12) P0.73
+ 0.05 = 0.78 20% (P0.16) P0.94

Moreover, rate making or rate fixing is not an easy task. It is a delicate

and sensitive government function that requires dexterity of judgment
and sound discretion with the settled goal of arriving at a just and
reasonable rate acceptable to both the public utility and the public.
Several factors, in fact, have to be taken into consideration before a
balance could be achieved. A rate should not be confiscatory as would
place an operator in a situation where he will continue to operate at a
loss. Hence, the rate should enable public utilities to generate
revenues sufficient to cover operational costs and provide reasonable
return on the investments. On the other hand, a rate which is too high
becomes discriminatory. It is contrary to public interest. A rate,
therefore, must be reasonable and fair and must be affordable to the
end user who will utilize the services.
Given the complexity of the nature of the function of rate-fixing and its
far-reaching effects on millions of commuters, government must not
relinquish this important function in favor of those who would benefit
and profit from the industry. Neither should the requisite notice and
hearing be done away with. The people, represented by reputable
oppositors, deserve to be given full opportunity to be heard in their
opposition to any fare increase.
The present administrative procedure,

14

to our mind, already mirrors an orderly

and satisfactory arrangement for all parties involved. To do away with such a procedure and
allow just one party, an interested party at that, to determine what the rate should be, will
undermine the right of the other parties to due process. The purpose of a hearing is
precisely to determine what a just and reasonable rate is. 15 Discarding such procedural and
constitutional right is certainly inimical to our fundamental law and to public interest.

On the presumption of public need.

A certificate of public convenience (CPC) is an authorization granted by
the LTFRB for the operation of land transportation services for public

use as required by law. Pursuant to Section 16(a) of the Public Service

Act, as amended, the following requirements must be met before a
CPC may be granted, to wit: (i) the applicant must be a citizen of the
Philippines, or a corporation or co-partnership, association or jointstock company constituted and organized under the laws of the
Philippines, at least 60 per centum of its stock or paid-up capital must
belong entirely to citizens of the Philippines; (ii) the applicant must be
financially capable of undertaking the proposed service and meeting
the responsibilities incident to its operation; and (iii) the applicant
must prove that the operation of the public service proposed and the
authorization to do business will promote the public interest in a
proper and suitable manner. It is understood that there must be
proper notice and hearing before the PSC can exercise its power to
issue a CPC.
While adopting in toto the foregoing requisites for the issuance of a
CPC, LTFRB Memorandum Circular No. 92-009, Part IV, provides for yet
incongruous and contradictory policy guideline on the issuance of a
CPC. The guidelines states:
The issuance of a Certificate of Public Convenience is
determined by public need. The presumption of public need
for a service shall be deemed in favor of the applicant,
while the burden of proving that there is no need for the
proposed service shall be the oppositor's. (Emphasis ours).
The above-quoted provision is entirely incompatible and inconsistent
with Section 16(c)(iii) of the Public Service Act which requires that
before a CPC will be issued, the applicant must prove by proper notice
and hearing that the operation of the public service proposed will
promote public interest in a proper and suitable manner. On the
contrary, the policy guideline states that the presumption of public
need for a public service shall be deemed in favor of the applicant. In
case of conflict between a statute and an administrative order, the
former must prevail.

By its terms, public convenience or necessity generally means

something fitting or suited to the public need. 16 As one of the basic
requirements for the grant of a CPC, public convenience and necessity exists when the
proposed facility or service meets a reasonable want of the public and supply a need which
the existing facilities do not adequately supply. The existence or
non-existence of public convenience and necessity is therefore a question of fact that must
be established by evidence, real and/or testimonial; empirical data; statistics and such other
means necessary, in a public hearing conducted for that purpose. The object and purpose of
such procedure, among other things, is to look out for, and protect, the interests of both the
public and the existing transport operators.

Verily, the power of a regulatory body to issue a CPC is founded on the

condition that after full-dress hearing and investigation, it shall find, as
a fact, that the proposed operation is for the convenience of the
public. 17 Basic convenience is the primary consideration for which a CPC is issued, and
that fact alone must be consistently borne in mind. Also, existing operators in subject routes
must be given an opportunity to offer proof and oppose the application. Therefore, an
applicant must, at all times, be required to prove his capacity and capability to furnish the
service which he has undertaken to
render. 18 And all this will be possible only if a public hearing were conducted for that
purpose.

Otherwise stated, the establishment of public need in favor of an

applicant reverses well-settled and institutionalized judicial, quasijudicial and administrative procedures. It allows the party who initiates
the proceedings to prove, by mere application, his affirmative
allegations. Moreover, the offending provisions of the LTFRB
memorandum circular in question would in effect amend the Rules of
Court by adding another disputable presumption in the enumeration of
37 presumptions under Rule 131, Section 5 of the Rules of Court. Such
usurpation of this Court's authority cannot be countenanced as only
this Court is mandated by law to promulgate rules concerning
pleading, practice and procedure. 19
Deregulation, while it may be ideal in certain situations, may not be
ideal at all in our country given the present circumstances. Advocacy
of liberalized franchising and regulatory process is tantamount to an
abdication by the government of its inherent right to exercise police

power, that is, the right of government to regulate public utilities for
protection of the public and the utilities themselves.
While we recognize the authority of the DOTC and the LTFRB to issue
administrative orders to regulate the transport sector, we find that
they committed grave abuse of discretion in issuing DOTC Department
Order
No. 92-587 defining the policy framework on the regulation of
transport services and LTFRB Memorandum Circular No. 92-009
promulgating the implementing guidelines on DOTC Department Order
No. 92-587, the said administrative issuances being amendatory and
violative of the Public Service Act and the Rules of Court.
Consequently, we rule that the twenty (20%) per centum fare increase
imposed by respondent PBOAP on March 16, 1994 without the benefit
of a petition and a public hearing is null and void and of no force and
effect. No grave abuse of discretion however was committed in the
issuance of DOTC Memorandum Order No. 90-395 and DOTC
Memorandum dated October 8, 1992, the same being merely internal
communications between administrative officers.
WHEREFORE, in view of the foregoing, the instant petition is hereby
GRANTED and the challenged administrative issuances and orders,
namely: DOTC Department Order No. 92-587, LTFRB Memorandum
Circular
No. 92-009, and the order dated March 24, 1994 issued by respondent
LTFRB are hereby DECLARED contrary to law and invalid insofar as
they affect provisions therein (a) delegating to provincial bus and
jeepney operators the authority to increase or decrease the duly
prescribed transportation fares; and (b) creating a presumption of
public need for a service in favor of the applicant for a certificate of
public convenience and placing the burden of proving that there is no
need for the proposed service to the oppositor.
The Temporary Restraining Order issued on June 20, 1994 is hereby
MADE PERMANENT insofar as it enjoined the bus fare rate increase

granted under the provisions of the aforementioned administrative

circulars, memoranda and/or orders declared invalid.
No pronouncement as to costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION

G.R. No. L-26803 October 14, 1975

AMERICAN TOBACCO COMPANY, CARNATION COMPANY,
CURTISS CANDY COMPANY, CUDAHY PACKING CO., CLUETT,
PEABODY & CO., INC., CANNONMILLS COMPANY, FORMICA
CORPORATION, GENERALMOTORS CORPORATION,
INTERNATIONAL LATEX CORPORATION, KAYSER-ROTH
CORPORATION, M and R DIETETIC LABORATORIES, INC., OLIN
MATHIESON, PARFUM CIRO, INC., PROCTER and GAMBLE
COMPANY, PROCTER and GAMBLE PHILIPPINE
MANUFACTURING CORPORATION, PARFUMS PORVIL
DENTRIFICES DU DOCTEUR PIERRE REUNIS SOCIETE
ANONYME, R.J. REYNOLDS TOBACCO COMPANY, SWIFT AND
COMPANY, STERLING PRODUCTS INTERNATIONAL, THE
CLOROX COMPANY, WARNER LAMBERT PHARMACEUTICALS
COMPANY and ZENITH RADIO CORPORATION, petitioners,
vs.
THE DIRECTOR OF PATENTS, ATTYS. AMANDO L. MARQUEZ,
TEOFILO P. VELASCO, RUSTICO A. CASIA and HECTOR D.
BUENALUZ, respondents.
Lichauco, Picazo and Agcaoili for petitioners.
Office of the Solicitor General for respondents.

ANTONIO, J.:
In this petition for mandamus with preliminary injunction, petitioners
challenge the validity of Rule 168 of the "Revised Rules of Practice
before the Philippine Patent Office in Trademark Cases" as amended,
authorizing the Director of Patents to designate any ranking official of
said office to hear "inter partes" proceedings. Said Rule likewise
provides that "all judgments determining the merits of the case shall
be personally and directly prepared by the Director and signed by
him." These proceedings refer to the hearing of opposition to the
registration of a mark or trade name, interference proceeding
instituted for the purpose of determining the question of priority of
adoption and use of a trade-mark, trade name or service-mark, and
cancellation of registration of a trade-mark or trade name pending at
the Patent Office.
Petitioners are parties, respectively, in the following opposition,
interference and cancellation proceedings in said Office: Inter
Partes Cases Nos. 157, 392, 896, 282, 247, 354, 246,332, 398, 325,
374, 175, 297, 256, 267, 111, 400, 324, 114, 159, 346, and 404.
Under the Trade-mark Law (Republic Act No. 166 ), the Director of
Patents is vested with jurisdiction over the above-mentioned cases.
Likewise, the Rules of Practice in Trade-mark Cases contains a similar
provision, thus:
168. Original jurisdiction over inter partes proceeding.
the Director of Patents shall have original jurisdiction
over inter partes proceedings. In the event that the Patent
Office should be provided with an Examiner of
Interferences, this Examiner shall have the original
jurisdiction over these cases, instead of the Director. In the
case that the Examiner of Interferences takes over the
original jurisdiction over inter partes proceedings, his final

decision subject to appeal to the Director of Patents within

three months of the receipt of notice of decisions. Such
appeals shall be governed by sections 2, 3, 4, 6, 7, 8, 10,
11, 12, 13, 14, 15 and 22 of Rule 41 of the Rules of Court
insofar as said sections are applicable and appropriate, and
the appeal fee shall be P25.00.
The Rules of Practice in Trade-mark Cases were drafted and
promulgated by the Director of Patents and approved by the then
Secretary of Agriculture and Commerce.. 1
Subsequently, the Director of Patents, with the approval of the
Secretary of Agriculture and Commerce, amended the afore-quoted
Rule 168 to read as follows:
168. Original Jurisdiction over inter partes proceedings.
The Director of Patents shall have original jurisdiction
over inter partes proceedings, [In the event that the Patent
Office is provided with an Examiner of Interferences, this
Examiner shall then have the original jurisdiction over these
cases, instead of the Director. In the case that the Examiner
of Interferences takes over the original jurisdiction
over inter partes proceedings, his final decisions shall be
subject to appeal to the Director of Patents within three
months of the receipt of notice decision. Such appeals shall
be governed by Sections 2, 3, 4, 6, 7, 8,10, 11, 12, 13, 14,
15, and 22 of Rule 41 of the Rules of Court insofar as said
sections are applicable and appropriate, and the appeal fee
shall be [P25.00.] Such inter partesproceedings in the
Philippine Patent Office under this Title shall be heard
before the Director of Patents, any hearing officer, or any
ranking official designated by the Director, but all
judgments determining the merits of the case shall be
personally and directly prepared by the Director and signed
by him. (Emphasis supplied.)

In accordance with the amended Rule, the Director of Patents

delegated the hearing of petitioners' cases to hearing officers,
specifically, Attys. Amando Marquez, Teofilo Velasco, Rustico Casia and
Hector Buenaluz, the other respondents herein.
Petitioners filed their objections to the authority of the hearing officers
to hear their cases, alleging that the amendment of the Rule is illegal
and void because under the law the Director must personally hear and
decideinter partes cases. Said objections were overruled by the
Director of Patents, hence, the present petition formandamus, to
compel The Director of Patents to personally hear the cases of
petitioners, in lieu of the hearing officers.
It would take an extremely narrow reading of the powers of the
Director of Patents under the general law 2 and Republic Acts Nos. 165 3 and
166 3* to sustain the contention of petitioners. Under section 3 of RA 165, the Director of
Patents is "empowered to obtain the assistance of technical, scientific or other qualified
officers or employees of other departments, bureaus, offices, agencies and instrumentalities
of the Government, including corporations owned, controlled or operated by the
Government, when deemed necessary in the consideration of any matter submitted to the
Office relative to the enforcement of the provisions" of said Act. Section 78 of the same Act
also empowers "the Director, subject to the approval of the Department Head," to
"promulgate the necessary rules and regulations, not inconsistent with law, for the conduct
of all business in the Patent Office." The aforecited statutory authority undoubtedly also
applies to the administration and enforcement of the Trade-mark Law (Republic Act No.
166).

It has been held that power-conferred upon an administrative agency

to which the administration of a statute is entrusted to issue such
regulations and orders as may be deemed necessary or proper in order
to carry out its purposes and provisions maybe an adequate source of
authority to delegate a particular function, unless by express
provisions of the Act or by implication it has been withheld. 4 There is no
provision either in Republic Act No. 165 or 166 negativing the existence of such authority, so
far as the designation of hearing examiners is concerned. Nor can the absence of such
authority be fairly inferred from contemporaneous and consistent Executive interpretation of
the Act.

The nature of the power and authority entrusted to The Director of

Patents suggests that the aforecited laws (Republic Act No. 166, in

relation to Republic Act No. 165) should be construed so as to give the

aforesaid official the administrative flexibility necessary for the prompt
and expeditious discharge of his duties in the administration of said
laws. As such officer, he is required, among others, to determine the
question of priority in patent interference proceedings, 5 decide applications
for reinstatement of a lapsed patent, 6 cancellations of patents under Republic Act No.
165, 7 inter partes proceedings such as oppositions, 8 claims of interference, 9 cancellation cases
10

and other matters in connection with the enforcement of the

aforesaid laws. It could hardly be expected, in view of the magnitude of his responsibility, to
require him to hear personally each and every case pending in his Office. This would leave
under the Trade-mark Law

him little time to attend to his other duties. 11 For him to do so and at the same time attend
personally to the discharge of every other duty or responsibility imposed upon his Office by
law would not further the development of orderly and responsible administration. The
reduction of existing delays in regulating agencies requires the elimination of needless work
at top levels. Unnecessary and unimportant details often occupy far too much of the time
and energy of the heads of these agencies and prevent full and expeditious consideration of
the more important issues. the remedy is a far wider range of delegations to subordinate
officers. This sub-delegation of power has been justified by "sound principles of
organization" which demand that "those at the top be able to concentrate their attention
upon the larger and more important questions of policy and practice, and their time be
freed, so far as possible, from the consideration of the smaller and far less important
matters of detail."

12

Thus, it is well-settled that while the power to decide resides solely in

the administrative agency vested by law, this does not preclude a
delegation of the power to hold a hearing on the basis of which the
decision of the administrative agency will be
made. 13
The rule that requires an administrative officer to exercise his own
judgment and discretion does not preclude him from utilizing, as a
matter of practical administrative procedure, the aid of subordinates to
investigate and report to him the facts, on the basis of which the
officer makes his decisions. 14 It is sufficient that the judgment and discretion finally
exercised are those of the officer authorized by law. Neither does due process of law nor the
requirements of fair hearing require that the actual taking of testimony be before the same
officer who will make the decision in the case. As long as a party is not deprived of his right
to present his own case and submit evidence in support thereof, and the decision is
supported by the evidence in the record, there is no question that the requirements of due
process and fair trial are fully met. 15 In short, there is no abnegation of responsibility on
the part of the officer concerned as the actual decision remains with and is made by said

officer. 16 It is, however, required that to "give the substance of a hearing, which is for the
purpose of making determinations upon evidence the officer who makes the determinations
must consider and appraise the evidence which justifies them."

17

In the case at bar, while the hearing officer may make preliminary
rulings on the myriad of questions raised at the hearings of these
cases, the ultimate decision on the merits of all the issues and
questions involved is left to the Director of Patents. Apart from the
circumstance that the point involved is procedural and not
jurisdictional, petitioners have not shown in what manner they have
been prejudiced by the proceedings.
Moreover, as the Solicitor General Antonio P. Barredo, now a Member
of this Court has correctly pointed out, the repeated appropriations by
Congress for hearing officers of the Philippine Patent Office form 1963
to 1968 18 not only confirms the departmental construction of the statute, but also
constitutes a ratification of the act of the Director of Patents and the Department Head as
agents of Congress in the administration of the law.

19

WHEREFORE, the instant petition is hereby dismissed, with costs

against petitioners.
Castro (Actg., C.J.), Muoz Palma, Aquino and Martin, JJ., concur.
Fernando, J, is on leave.
Barredo, J., took no part.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC

G.R. No. 108310 September 1, 1994

RUFINO O. ESLAO, in his capacity as President of Pangasinan
State University, petitioner,
vs.
COMMISSION ON AUDIT, respondent.
Mehol K. Sadain for petitioner.

FELICIANO, J.:
In this Petition for Certiorari, Rufino O. Eslao in his capacity as
President of the Pangasinan State University ("PSU") asks us to set

aside Commission on Audit ("COA") Decisions Nos. 1547 (1990) and

2571 (1992) which denied honoraria and per diems claimed under
National Compensation Circular No. 53 by certain PSU personnel
including petitioner.
On 9 December 1988, PSU entered into a Memorandum of Agreement
("MOA") 1 with the Department of Environment and Natural Resources ("DENR") for the
evaluation of eleven (11) government reforestation operations in Pangasinan. 2 The
evaluation project was part of the commitment of the Asian Development Bank ("ADB")
under the ADB/OECF Forestry Sector Program Loan to the Republic of the Philippines and
was one among identical project agreements entered into by the DENR with sixteen (16)
other state universities.

On 9 December 1988, a notice to proceed

with the review and evaluation of

the eleven (11) reforestation operations was issued by the DENR to PSU. The latter
complied with this notice and did proceed.

On 16 January 1989, per advice of the PSU Auditor-in-Charge with

respect to the payment of honoraria and per diems of PSU personnel
engaged in the review and evaluation project, PSU Vice President for
Research and Extension and Assistant Project Director Victorino P.
Espero requested the Office of the President, PSU, to have the
University's Board of Regents ("BOR") confirm the appointments or
designations of involved PSU personnel including the rates
of honoraria and per diems corresponding to their specific roles and
functions. 4
The BOR approved the MOA on 30 January 1989

and on 1 February 1989,

PSU issued Voucher No. 8902007 representing the amount of P70,375.00 for payment
of honoraria to PSU personnel engaged in the project. Later, however, the
approved honoraria rates were found to be somewhat higher than the rates provided for in
the guidelines of National Compensation Circular ("NCC") No. 53. Accordingly, the amounts
were adjusted downwards to conform to NCC No. 53. Adjustments were made by deducting
amounts from subsequent disbursements of honoraria. By June 1989, NCC No. 53 was
being complied with.

On 6 July 1989, Bonifacio Icu, COA resident auditor at PSU, alleging

that there were excess payments ofhonoraria, issued a "Notice of
Disallowance" 8 disallowing P64,925.00 from the amount of P70,375.00 stated in
Voucher No. 8902007, mentioned earlier. The resident auditor based his action on the

premise that Compensation Policy Guidelines ("CPG") No. 80-4, dated 7 August 1980,
issued by the Department of Budget and Management which provided for lower rates than
NCC No. 53 dated 21 June 1988, also issued by the Department of Budget and
Management, was the schedule for honoraria and per diems applicable to work done under
the MOA of 9 December 1988 between the PSU and the DENR.

On 18 October 1989, a letter

was sent by PSU Vice President and Assistant

Project Director Espero to the Chairman of the COA requesting reconsideration of the action
of its resident auditor. In the meantime, the Department of Budget and Management
("DBM"), upon request by PSU, issued a letter 10 clarifying that the basis for the
project's honoraria should notbe CPG No. 80-4 which pertains to locally funded projects but
rather NCC No. 53 which pertains to foreign-assisted projects. A copy of this clarification
was sent to the COA upon request by PSU.

On 18 September 1990, COA Decision No. 1547

11

was issued denying

reconsideration of the decision of its resident auditor. The COA ruled that CPG. No. 80-4 is
the applicable guideline in respect of the honoraria as CPG No. 80-4 does not distinguish
between projects locally funded and projects funded or assisted with monies of foreignorigin.

PSU President Eslao sent a letter

12

dated 20 March 1991 requesting

reconsideration of COA Decision No. 1547 (1990) alleging that (a) COA had erred in
applying CPG No. 80-4 and not NCC No. 53 as the project was foreign-assisted and (b) the
decision was discriminatory honoraria based on NCC No. 53 having been approved and
granted by COA resident auditors in two (2) other state universities engaged in the same
reforestation project. PSU then submitted to the COA (a) a certification 13 from the DENR to
the effect that the DENR evaluation project was foreign- assisted and (b) the letter of the
DBM quoted in the margin supra.

On 16 November 1992, COA Decision No. 2571 (1992)

14

was issued

denying reconsideration.

In the meantime, in December 1990, the DENR informed petitioner of

its acceptance of the PSU final reports on the review and evaluation of
the government reforestation projects. 15 Subsequently, honoraria for the period
from January 1989 to January 1990 were disbursed in accordance with NCC No. 53. A
Certificate of Settlement and Balances (CSB No. 92-0005-184 [DENR]) 16 was then issued
by the COA resident auditor of PSU showing disallowance of alleged excess payment
of honoraria which petitioner was being required to return.

The instant Petition prays that (a) COA Decision Nos. 1547 (1990) and
2571 (1992) be set aside; (b) the COA be ordered to pass in audit the
grant of honoraria for the entire duration of the project based on the

provisions and rates contained in NCC No. 53; and (c) the COA be held
liable for actual damages as well as petitioner's legal expenses and
attorney's fees.
The resolution of the dispute lies in the determination of the circular or
set of provisions applicable in respect of the honoraria to be paid to
PSU personnel who took part in the evaluation project, i.e., NCC No.
53 or CPG No. 80-4.
In asserting that NCC No. 53 supplies the applicable guideline and that
the COA erred in applying CPG No. 80-4 as the pertinent standard,
petitioner contends that:
(a) CPG No. 80-4 applies to "special projects" the definition and
scope of which do not embrace the evaluation project undertaken
by petitioner for the DENR;
(b) NCC No. 53 applies to foreign-assisted projects ("FAPs") while
CPG No. 80-4 applies to locally-funded projects as no reference
to any foreign component characterizing the projects under its
coverage is made;
(c) the DENR evaluation project is a foreign-assisted project per
certification and clarification of the DENR and DBM respectively
as well as the implied admission of the COA in its Comment; and
(d) the DBM's position on the matter should be respected since
the DBM is vested with authority to (i) classify positions and
determine appropriate salaries for specific position classes, (ii)
review the compensation benefits programs of agencies and (iii)
design job evaluation programs.
The Office of the Solicitor General, in lieu of a Comment on the
Petition, filed a Manifestation 17 stating that (a) since, per certification of the DENR
and Letter/Opinion of the DBM that the project undertaken by PSU is foreign-assisted, NCC
No. 53 should apply; and (b) respondent COA's contention that CPG No. 80-4 does not
distinguish between projects which are foreign-funded from locally-funded projects deserves
no merit, since NCC No. 53, a special guideline, must be construed as an exception to CPG

No. 80-4, a general guideline. The Solicitor General, in other words, agreed with the position
of petitioner.

Upon the other hand, respondent COA filed its own comment,
asserting that:
(a) while the DBM is vested with the authority to issue rules
and regulations pertaining to compensation, this authority
is regulated by Sec. 2 (2) of Art. IX-D of the 1987
Constitution which vests respondent COA with the power to
"promulgate accounting and auditing rules and regulations,
including those for the prevention and disallowance of
irregular, unnecessary, excessive, extravagant or
unconscionable expenditures, or uses of government funds
and properties;
(b) the Organizational Arrangement and Obligations of the
Parties sections of the MOA clearly show that the evaluation
project is an "inter-agency activity" between the DENR and
PSU and therefore a "special project";
(c) the issue as to whether the evaluation project is in fact
a "special project" has become moot in view of the DBM's
clarification/ruling that the evaluation project is foreignassisted and therefore NCC No. 53, not CPG No. 80-4 which
applies only to locally-funded projects, should apply;
(d) the DBM issuance notwithstanding, respondent COA
applied CPG No. 80-4 to effectively rationalize the rates of
additional compensation assigned to or detailed in "special
projects" as its application is without distinction as to the
source of funding and any payment therefore in excess of
that provided by CPG No. 80-4 is unnecessary, excessive
and disadvantageous to the government;
(e) respondent COA's previous allowance of payment
of honoraria based on NCC No. 53 or the fact that a full five

years had already elapsed since NCC No. 53's issuance does
not preclude COA from assailing the circular's validity as "it
is the responsibility of any public official to rectify every
error he encounters in the performance of his function" and
"he is not duty- bound to pursue the same mistake for the
simple reason that such mistake had been continuously
committed in the past";
(f) the DBM ruling classifying the evaluation project as
foreign-assisted does not rest on solid ground since loan
proceeds, regardless of source, eventually become public
funds for which the government is accountable, hence, any
project under the loan agreement is to be considered
locally-funded;
(g) the DBM ruling constitutes an unreasonable
classification, highly discriminatory and violative of the
equal protection clause of the Constitution; and
(h) granting arguendo NCC No. 53 is the applicable
criterion, petitioner received honoraria in excess of what
was provided in the MOA.
We consider the Petition meritorious.
Sec. 2.1 of CPG No. 80-4 defines "special project" as
an inter-agency or inter-committee activity or
an undertaking by a composite group of officials/employees
from various agencies which [activity or undertaking] is not
among the regular and primary functions of the agencies
involved. (Emphasis and brackets supplied)
Respondent COA maintains that the sections of the MOA detailing the
"Organizational Arrangement and Obligations of the Parties" clearly
show that the evaluation project is an "inter-agency activity." The
pertinent sections of the MOA are as follows:

ORGANIZATIONAL ARRANGEMENTS
A Coordinating Committee shall be created which shall be
responsible for the overall administration and coordination
of the evaluation, to be chaired by a senior officer of the
DENR. The Committee shall [be] composed [of] the
following:
Chairman : Undersecretary for Planning,
Policy and Project Management
[DENR]
Co-Chairman : Vice-President for Research
and Development [PSU]
Members : Director of FMB
Dean, PSU Infanta Campus
Associate Dean, PSU Infanta
Campus
Chief, Reforestation
Division
Project Director of the ADB
Program Loan for Forestry
Sector
OBLIGATIONS OF THE PARTIES
Obligations of DENR:
The DENR shall have the following obligations:
1. Provide the funds necessary for the review and
reevaluation of eleven (11) reforestation projects.
xxx xxx xxx

2. Undertake the monitoring of the study to ascertain its

progress and the proper utilization of funds in conformity
with the agreed work and financial plan.
3. Reserve the right to accept or reject the final report and
in the latter case, DENR may request PSU to make some
revisions/modifications on the same.
Obligations of the PSU:
The PSU shall have the following obligations:
1. Undertake the review and evaluation of the eleven (11)
DENR-funded reforestation projects in accordance with the
attached TOR;
2. Submit regularly to DENR financial status reports apart
from the progress report required to effect the second
release of funds;
3. Submit the final report to DENR fifteen (15) days after
the completion of the work. The report should at least
contain the information which appears in Annex D;
4. Return to DENR whatever balance is left of the funds
after the completion of work.
Simply stated, respondent COA argues that since the Coordinating
Committee is composed of personnel from the DENR and PSU, the
evaluation project is an "inter-agency activity" within the purview of
the definition of a "special project".
We are unable to agree with respondent COA.
Examination of the definition in CPG No. 80-4 of a "special project"
reveals that definition has two (2) components: firstly, there should be
an inter-agency or inter-committee activity or undertaking by a group
of officials or employees who are drawn from various agencies; and

secondly, the activity or undertaking involved is not part of the

"regular or primary" functions of the participating agencies.
Examination of the MOA and its annexes reveals that two (2) groups
were actually created. The first group consisted of the coordinating
committee, the membership of which was drawn from officials of the
DENR and of the PSU; and the second, the evaluation project
team itself which was, in contrast, composed exclusively of PSU
personnel. 18 We believe that the first component of the CPU No. 80-4's definition of
"special project" is applicable in respect of the group which is charged with the actual
carrying out of the project itself, rather than to the body or group which coordinates the
task of the operating or implementing group. To construe the administrative definition of
"special project" otherwise would create a situation, which we deem to be impractical and
possibly even absurd, under which any undertaking entered into between the senior officials
of government agencies would have to be considered an "inter-agency or inter-committee
activity," even though the actual undertaking or operation would be carried out not by the
coordinating body but rather by an separate group which might not (as in the present case)
be drawn from the agencies represented in the coordinating group. In other words, an
"inter-agency or inter-committee activity or . . . undertaking" must be one which is actually
carried out by a composite group of officials and employees from the two (2) or more
participating agencies.

As already noted, in the case at hand, the project team actually tasked
with carrying out the evaluation of the DENR reforestation activity
is composed exclusively of personnel from PSU; the project team's
responsibility and undertaking are quite distinct from the
responsibilities of the coordinating [DENR and PSU] committee. Thus,
the project team is not a "composite group" as required by the
definition of CPG No. 80-4 of "special projects." It follows that the
evaluation projects here involved do not fall within the ambit of a
"special project" as defined and regulated by CPG No. 80-4.
We do not consider it necessary to rule on whether the project at hand
involved an undertaking "which is not among the regular and primary
functions of the agencies involved" since the reforestation activity
evaluation group is not, as pointed out above, a "special project"
within the meaning of CPG No. 80-4. In any case, this particular issue
was not raised by any of the parties here involved.

It is true, as respondent COA points out, that the provisions of CPG

No. 80-4 do not distinguish between "a special project" which is
funded by monies of local or Philippine origin and "a special project"
which is funded or assisted by monies originating from international or
foreign agencies. As earlier noted, CPG No. 80-4 was issued by the
Department of Budget and Management back in 7 August 1980. Upon
the other hand, NCC No. 53 was issued also by the Department of
Budget and Management more than eight (8) years later, i.e., 9
December 1988. Examination of the provisions of NCC No. 53 makes it
crystal clear that the circular is applicable to foreign-assisted projects
only. The explicit text of NCC No. 53 states that it was issued to
prescribe/authorize the classification and compensation
rates of positions in foreign-assisted projects(FAPs)
including honoraria rates for personnel detailed to FAPs and
guidelines in the implementation thereof pursuant to
Memorandum No. 173 dated 16 May 1988 19 (Emphasis supplied)
and which apply to all positions in foreign-assisted projects only.
Clearly, NCC No. 53 amended the earlier CPG No. 80-4 by carving out
from the subject matter originally covered by CPG No. 80-4 all
"foreign-assisted [special] projects." CPG No. 80-4 was, accordingly,
modified so far as "foreign-assisted [special] projects (FAPs)" are
concerned. It is this fact or consequence of NCC No. 53 that
respondent COA apparently failed to grasp. Thus, CPG No. 80-4 does
not control, nor even relate to, the DENR evaluation project for at least
two (2) reasons: firstly, the evaluation project was not a "special
project" within the meaning of CPG No. 80-4; secondly, that same
evaluation project was a Foreign-Assisted Project to which NCC No. 53
is specifically applicable.
That the instant evaluation project is a Foreign-Assisted Project is
borne out by the records: (a) the MOA states that the project is "part
of the commitment with the Asian Development Bank (ADB) under the
Forestry Sector Program Loan"; (b) the certification issued by the
DENR certifies that

. . . the review and evaluation of DENR reforestation

projects undertaken by State Universities and Colleges, one
of which is Pangasinan State University, is one of the
components of the ADB/OECF Forestry Sector Program Loan
which is funded by the loan. It is therefore a
foreign-assisted project (Underscoring supplied); and
(c) the clarification issued by the DBM stating that
The honoraria rates of the detailed personnel should not be
based on Compensation Policy Guidelines No. 80-4, which
pertains to locally funded projects. Since the funding source
for this activity come from loan proceeds, National
Compensation Circular No. 53 should apply.
Even in its Comment respondent COA submits that
. . . the issue as to whether or not the project was special
already became moot in the face of the opinion/ruling of the
DBM that since it (the project) is "foreign-assisted" NCC 53
should apply, for CPG No. 80-4 applies only to "locallyfunded projects. 20
Under the Administration Code of 1987, the Compensation and
Position Classification Bureau of the DBM "shall classify positions and
determine appropriate salaries for specific position classes and review
appropriate salaries for specific position classes and review the
compensation benefits programs of agencies and shall design job
evaluation programs." 21 In Warren Manufacturing Workers Union (WMWU) v. Bureau
of Labor Relations, 22 the Court held that "administrative regulations and policies enacted by
administrative bodies to interpret the law have the force of law and are entitled to great
respect." It is difficult for the Court to understand why, despite these certifications,
respondent COA took such a rigid and uncompromising posture that CPG No. 80-4 was the
applicable criterion for honoraria to be given members of the reforestation evaluation
project team of the PSU.

Respondent COA's contention that the DBM clarification is

unconstitutional as that ruling does not fulfill the requisites of a valid

classification

23

is, in the Court's perception, imaginative but nonetheless an afterthought and a futile attempt to justify its action. As correctly pointed out by petitioner, the
constitutional arguments raised by respondent COA here were never even mentioned, much
less discussed, in COA Decisions Nos. 1547 (1990) and 2571 (1992) or in any of the
proceedings conducted before it.

Petitioner also argues that the project's duration stipulated in the MOA
was implicitly extended by the parties. The DENR's acceptance,
without any comment or objection, of PSU's (a) letter explaining the
delay in its submission of the final project report and (b) the final
project report itself brought about, according to petitioner, an implied
agreement between the parties to extend the project duration. It is
also contended that by the very nature of an evaluation project, the
project's duration is difficult to fix and as in the case at bar, the period
fixed in the MOA is merely an initial estimate subject to extension.
Lastly, petitioner argues that whether the project was impliedly
extended is an inconsequential consideration; the material
consideration being that the project stayed within its budget. The
project having been extended, petitioner concludes that the evaluation
team should be paidhonoraria from the time it proceeded with the
project and up to the time the DENR accepted its final report.
Mindful of the detailed provisions of the MOA and Project Proposal
governing project duration and project financing as regulated by NCC
No. 53, the Court is not persuaded that petitioner can so casually
assume implicit consent on the part of the DENR to an extension of the
evaluation project's duration.
The "Duration of Work" clause of the MOA provides that
PSU shall commence the work 10 days from receipt of the
Notice to Proceed and shall be completed five months
thereafter. (Emphasis supplied)
On 9 December 1988, the DENR advised PSU President Rufino
Eslao that PSU "may now proceed with the review and

reevaluation as stipulated" in the MOA. The Notice to Proceed

further stated that
Your institution is required to complete the work within five
months starting ten (10) days upon receipt of this notice.
(Emphasis supplied)
In respect of the financial aspects of the project, the MOA provides
that
The DENR shall have the following obligations:
1. Provide the funds necessary for the review and
reevaluation of the eleven (11) reforestation projects . . . in
the amount not more than FIVE HUNDRED SIX THOUSAND
TWO HUNDRED TWENTY FOUR PESOS (P506,224.00)
which shall be spent in accordance with the work and
financial plan which attached as Annex C. Fund remittances
shall be made on a staggered basis with the following
schedule:
a. FIRST RELEASE
Twenty percent (20%) of the total cost to be
remitted within fifteen (15) working days upon submission
of work plan;
b. SECOND RELEASE
Forty percent of the total cost upon submission of a
progress report of the activities that were so far
undertaken;
c. THIRD RELEASE
Thirty percent (30%) of the total amount upon submission
of the draft final report;

d. FOURTH RELEASE
Ten percent of the total amount [upon submission] of the
final report. (Underscoring supplied)
Annex "C" referred to in the MOA is the Project Proposal. Per the
Proposal's "Budget Estimate," P175,000.00 and P92,500.00 were
allotted for "Expert Services" and "Support Services" respectively
itemized as follows:
PERSONAL SERVICES
EXPERT SERVICES
Duration
Expert of Service Rate/ Total
(mo.) mo.
1. Ecologist 4 P5,000 P20,000
2. Silviculturist 3 -do- 15,000
3. Forestry Economist 4 -do- 20,000
4. Soils Expert 2 -do- 10,000
5. Social Forestry Expert 4 -do- 20,000
6. Management Expert 2 -do- 10,000
7. Horticulturist 2 -do- 10,000
8. Agricultural Engineer 2 -do- 10,000
9. Systems Analysts/Programer 2 -do- 10,000
10. Statistician 2 -do- 10,000

11. Shoreline Resources Expert 2 -do- 10,000

12. Animal Science Specialist 2 -do- 10,000
13. Policy/Administrative 4 -do- 20,000
Expert
T O T A L P175,000

Support Services
Research Associates (2) P8,000
Honorarium P1,000/mo. for 4 months
Special Disbursing Officer (1) 4,000
Honorarium P1,000/mo. for 4 months
Enumerators/Data Gatheres 36,000
360 mandays at P100/manday
including COLA
Coders/Encoders 30,000
300 mandays at P100/manday
including COLA
Cartographer/Illustrator 5,000
50 mandays at P100/manday
including COLA
Documentalist 4,500
45 mandays at P100/manday
including COLA
Typist 5,000
50 mandays at P100/manday
including COLA
T O T A L P92,500

In addition, the Proposal already provided a list of identified

experts:
EXPERTS
1. Dr. Victorino P. Espero Enviromental Science
2. Dean Antonio Q. Repollo Silviculture
3. Prof. Artemio M. Rebugio Forestry Economics
4. Ms. Naomenida Olermo Soils
5. Dr. Elvira R. Castillo Social Forestry
6. Dr. Alfredo F. Aquino Management
7. Dr. Lydio Calonge Horticulture
8. Engr. Manolito Bernabe Engineering
9. Dr. Elmer C. Vingua Animal Science
10. Prof. Rolando J. Andico Systems Analysts
Programming
11. Dr. Eusebio Miclat, Jr. Statistics/
Instrumentation
12. Dr. Porferio Basilio Shoreline Resources
13. Dr. Rufino O. Eslao Policy Administration
who, together with six (6) staff members namely Henedina M.
Tantoco, Alicia Angelo Yolanda Z. Sotelo, Gregoria Q. Calela, Nora
A. Caburnay and Marlene S. Bernebe composed the evaluation
project team. At this point, it should be pointed out that the "
Budget Estimate even provides a duration for the participation of
each and every person whether rendering expert or support
services.

On the other hand, NCC No. 53 provides:

3.3.1 The approved 0rganization and staffing shall be valid
up to project completion except for modifications deemed
necessary by the Project Manager. The Project Manager
shall be given the flexibility to determine the timing of

hiring personnel provided the approved man-years for a

given position for the duration of the project is not
exceeded.
xxx xxx xxx
3.6 A regular employee who may detailed to any FAPs on a
part-time basis shall be entitled to receive honoraria in
accordance with the schedule shown in Attachment II
hereof.
xxx xxx xxx
3.7 Payment of honoraria shall be made out of project
funds and in no case shall payment thereof be made out of
regular agency fund.
xxx xxx xxx
3.10 The total amount of compensation to be paid shall not
exceed the original amount allocated for personal
services of the individual foreign-assisted projects. Any
disbursement in excess of the original amount allotted for
personal services of the individual projects shall be the
personal liability and responsibility of the officials and
employees authorizing or making such payment.
(Underscoring supplied)
Attachment II of NCC No. 53 prescribes the monthly rates allowed for
officials/employees on assignment to foreign- assisted special projects:
A. Position Level Project Manager/Project
Director
Responsibility . . .
Parttime P2,000.00

B. Position Level Assistant Project

Director
Responsibility . . .
Parttime P1,500.00
C. Position Level Project Consultant
Responsibility . . .
Parttime P1,000.00
D. Position Level Supervisor/Senior Staff
Member
Responsibility . . .
Parttime P1,000.00
E. Position Level Staff Member
Responsibility . . .
Parttime P700.00
Administrative and Clerical Support
A. Position Level Administrative Assistant
Responsibility . . .
Parttime P500.00
B. Position Level Administrative Support
Staff
Responsibility . . .

Parttime P400.00
From the clear and detailed provisions of the MOA and Project Proposal
in relation to NCC No. 53, consent to any extension of the evaluation
project, in this instance, must be more concrete than the alleged
silence or lack of protest on the part of the DENR. Although tacit
acceptance is recognized in our jurisdiction, 24 as a rule, silence is not
equivalent to consent since its ambiguity lends itself to error. And although under the Civil
Code there are instances when silence amounts to consent, 25 these circumstances are
wanting in the case at bar. Furthermore, as correctly pointed out by the respondent COA,
the date when the DENR accepted the final project report is by no means conclusive as to
the terminal date of the evaluation project. Examination of the MOA (quoted earlier on
pages 19-20) reveals that the submission of reports merely served to trigger the phased
releases of funds. There being no explicit agreement between PSU and the DENR to extend
the duration of the evaluation project, the MOA's "Budget Estimate" which, among others,
provides in detail the duration of service for each member of the evaluation project as
amended by the rates provided by NCC No. 53 must be the basis of the honoraria due to the
evaluation team.

The other arguments of respondent COA appear to us to be

insubstantial and as, essentially, afterthoughts. The COA
apparently does not agree with the policy basis of NCC No. 53 in
relation to CPG No. 80-4 since COA argues that loan proceeds
regardless of source eventually become public funds for which
the government is accountable. The result would be that any
provisions under any [foreign] loan agreement should be
considered locally-funded. We do not consider that the COA is,
under its constitutional mandate, authorized to substitute its own
judgment for any applicable law or administrative regulation with
the wisdom or propriety of which, however, it does not agree, at
least not before such law or regulation is set aside by the
authorized agency of government i.e., the courts as
unconstitutional or illegal and void. The COA, like all other
government agencies, must respect the presumption of legality
and constitutionality to which statutes and administrative
regulations are entitled 26 until such statute or regulation is repealed or
amended, or until set aside in an appropriate case by a competent court (and
ultimately this Court).

Finally, we turn to petitioner's claim for moral damages and

reimbursement of legal expenses. We consider that this claim
cannot be granted as petitioner has failed to present evidence of
bad faith or tortious intent warranting an award thereof. The
presumption of regularity in the performance of duty must be
accorded to respondent COA; its action should be seen as its
effort to exercise (albeit erroneously, in the case at bar) its
constitutional power and duty in respect of uses of government
funds and properties.
WHEREFORE, for all the foregoing, the Petition for Certiorari is
hereby GRANTED. COA Decisions Nos. 1547 and 2571,
respectively dated 18 September 1990 and 16 November 1992,
are hereby SET ASIDE. The instant evaluation project being a
Foreign-Assisted Project, the following PSU personnel involved in
the project shall be paid according to the Budget Estimate
schedule of the MOA as aligned with NCC No. 53:
A. A. For Experts
Duration Rate/
Expert of month Total
Service (NCC
(mo.) No. 53)
1. Dr. Rufino O. Eslao Policy/Admi- 4 P2,000 P8,000 nistrative
expert*2. Dr. Victorino P. Espero Ecologist** 4 1,500 6,000
3. Dean Antonio Q. Repollo Silvicul- 3 1,000 3,000
turist***
4. Prof. Artemio M. Rebugio Forestry 4 1,000 4,000
Economist
5. Ms. Naomenida Olermo Soils Expert 2 1,000 2,000
6. Dr. Elvira R. Castillo Social 4 1,000 4,000
Forestry
Expert

7. Dr. Alfredo F. Aquino Management 2 1,000 2,000

Expert
8. Dr. Lydio Calonge Horticul 2 1,000 2,000
turist
9. Engr. Manolito Bernabe Agricultural 2 1,000 2,000
Engineer
10. Prof. Rolando J. Andico Systems 2 1,000 2,000
Analysts/
Programmer
11. Dr. Eusebio Miclat, Jr. Statistician 2 1,000 2,000
12. Dr. Porferio Basilio Shoreline 2 1,000 2,000
Resources
Expert
13. Dr. Elmer C. Vingua Animal 2 1,000 2,000
Science
Specialist
41,000

* Project Manager/ Project Director

** Assistant Project Director
*** Project Consultants
B. For Support Staff
Duration Rate/
Expert of month Total
Service (NCC
(mo.) No. 53)
1 Henedina M. Tantoco Research 4 700 2,800
Associate**
2 Alicia Angelo Research 4 700 2,800
3 Yolanda Z. Sotelo Documentalist 2.04 700 1,428
4 Gregoria Q. Calela Special 4 700 2,800

Disbursing
Officer
5 Nora A. Caburnay Typist 2.27 500 1,135
6 Marlene S. Bernebe Cashier 2.27 500 1,135

12,098
* Per Attachment to DBM Clarification dated 10
November 1989, Rollo, p. 59.
** Staff Member
*** Administrative Assistants.
No pronouncement as to costs.
SO ORDERED.
Narvasa, Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo,
Quiason, Puno, Vitug, Kapunan and Mendoza, JJ., concur.
Cruz, Bidin, on leave.

#Footnotes

1 Annex 'A' of Petition, Rollo, pp. 24-49.

2 Bamboo Pilot Plantation Project (Infanta); Bamboo
Plantation Project (Mangatarem); Bamboo Pilot Project
(Natividad); Mangrove Revegetation Project
(Anda/Bolinao/Alaminos); Manleluag Reforestation Project
(Mangatarem); Support to PIADP (Cacaoiten/Mangatarem);
Support to PIADP (San Nicolas/Natividad); Support to
PIADP (Siwasiw/Sual); San Nicolas Reforestation Project
(San Nicolas); Urban Forestry Project (Dagupan City) and
Villaverde Trail Revegetation Project (San Nicolas).

3 Annex 'B' of Petition, Rollo, p. 49.

4 Annex 'C' of Petition, Rollo, p. 50.
5 Annex 'D' of Petition, Rollo, p. 51.
6 Annex 'E' of Petition, Rollo, p. 52.
7 Annexes 'F', 'G' and 'H', Rollo, pp. 53-55.
8 Annex "I" of Petition, Rollo, p. 56. The Notice reads:
July 6, 1989
Mr. Rufino Eslao
University President, PSU Main
Lingayen, Pangasinan
Sir/Madam:
This is to inform you that in our audit of 8902007 (Pres.
Rufino O. Eslao and Co.) the amount of P70,375.00 has
been disallowed for the following reasons:
Amount paid per payroll........... P 70,375.00
Amount allowed in audit .......... 5,450.00
Difference to be refunded ....... 64,925.00
Amount paid in excess of the authorized
rates under CPG 80-4 dated August 7,
1980 is disallowed.

and you have been determined as one to be jointly and

severally liable therefor.
In view of this, you are hereby directed to settle
immediately the above disallowance. Failure to do so may
compel this Office to adopt the necessary measures to
enforce settlement hereof.
Very truly yours,
(SGD.) Bonifacio Icu
9 Annex 'J' of Petition, Rollo, p. 57.
10 Annex 'K' of Petition, Rollo, pp. 58-59. The letter reads:
November 10, 1989
Hon. Rufino O. Eslao
President, Pangasinan State University
Lingayen, Pangasinan
Dear President O. Eslao,
This pertains to your request for authority to pay the
honoraria of Pangasinan State University (PSU) personnel
detailed to the Department of Environment and Natural
Resources - PSU Project under the ADB assisted Forestry
Sector Loan (889/890 PHI).
The honoraria rates of the detailed personnel should not be
based on Compensation Policy Guidelines No. 80-4, which
pertains to locally funded projects. Since the funding source
for this activity come from loan proceeds, National
Compensation Circular No. 53 should apply.

It should be pointed out that the provisions of your

Memorandum of Agreement with the DENR cannot prescribe
higher honoraria rates than that authorized under existing
rules and regulations.
In view of the foregoing, attached is the authority to grant
honoraria to PSU personnel at the rates prescribed.
We hope that this clarifies the issues in your letter.
Very truly yours,
(SGD.)
for Guillermo N. Carague
(Underscoring supplied)
11 Annex 'L' of Petition, Rollo, p. 60. COA Decision NO.
1547 reads:
September 18, 1990
Mr. Victorino P. Espero
Officer in Charge and
Vice President for Research
and Development
Pangasinan State University
Lingayen, Pangasinan
Sir:
This pertains to your letter dated October 9, 1989, seeking
reconsideration of the decision of this Commission
contained in a 2nd Indorsement dated May 10, 1989,

denying the claim for honoraria and per diems of some

personnel of the Pangasinan State University assigned at
the DENR Reforestation Project in Pangasinan in excess of
those provided under Compensation Policy Guidelines 80-4
dated April 7, 1980.
You allege that the project in question does not fall under
the contemplation of Compensation Policy Guideline (sic)
No. 80-4 since it is a foreign-assisted project. We find your
position to be meritless. It bears stress that the purpose of
the guideline is to rationalize the rates of additional
compensation of officials on assignment to special projects
and to ensure uniform practice therein. Thus, it is believed
that CPG No. 80-4 remains to be the present guideline on
the matter since it does not qualify whether or not the
same is applicable only to locally funded special projects.
Where the law does not distinguish, no distinction should be
made.
Premises considered, the herein request for reconsideration
has to be, as it is hereby, denied.

EN BANC
WILLIAM C. DAGAN, CARLOS G.R. No. 175220
H. REYES, NARCISO MORALES,
BONIFACIO MANTILLA, Present:
CESAR AZURIN, WEITONG LIM,
MA. TERESA TRINIDAD, MA. PUNO, C.J.,

CARMELITA FLORENTINO, QUISUMBING,

Petitioners, YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
- versus - CARPIO MORALES,
AZCUNA,
TINGA,
CHICO-NAZARIO,
VELASCO, JR.,
PHILIPPINE RACING COMMISSION, NACHURA,
MANILA JOCKEY CLUB, INC., and LEONARDO DE CASTRO,
PHILIPPINE RACING CLUB, INC., BRION, and
Respondents PERALTA, JJ.
Promulgated:
February 12, 2009
x
---------------------------------------------------------------------------------- x

DECISION
TINGA, J.:
The subject of this petition for certiorari is the decision [1] of
the

Court

of

Appeals

in

CA-G.R.

SP

No. 95212,

affirming in toto the judgment[2] of the Regional Trial Court of

Makati in Civil Case No. 04-1228.

The

controversy

stemmed

from

the 11

August

2004 directive[3] issued by the Philippine Racing Commission

(Philracom) directing the Manila Jockey Club, Inc. (MJCI) and

Philippine Racing Club, Inc. (PRCI) to immediately come up with
their respective Clubs House Rule to address Equine Infectious
Anemia (EIA)[4] problem and to rid their facilities of horses
infected

with

Administrative

EIA.
Order

Said
No.

directive

was

5[5] dated 28

issued
March

pursuant
1994 by

to
the

Department of Agriculture declaring it unlawful for any person,

firm or corporation to ship, drive, or transport horses from any
locality or place except when accompanied by a certificate issued
by the authority of the Director of the Bureau of Animal Industry
(BAI).[6]
In compliance with the directive, MJCI and PRCI ordered the
owners of racehorses stable in their establishments to submit the
horses to blood sampling and administration of the Coggins
Test to determine whether they are afflicted with the EIA
virus. Subsequently, on 17 September 2004, Philracom issued
copies of the guidelines for the monitoring and eradication of EIA.
[7]

Petitioners and racehorse owners William Dagan (Dagan),

Carlos Reyes, Narciso Morales, Bonifacio Montilla, Cezar Azurin,
Weitong Lim, Ma. Teresa Trinidad and Ma. Carmelita Florentino
refused to comply with the directive. First, they alleged that there
had been no prior consultation with horse owners. Second, they

claimed that neither official guidelines nor regulations had been

issued relative to the taking of blood samples. And third, they
asserted that no documented case of EIA had been presented to
justify the undertaking.[8]
Despite

resistance

from

petitioners,

the

blood

testing

proceeded. The horses, whose owners refused to comply were

banned from the races, were removed from the actual day of
race, prohibited from renewing their licenses or evicted from their
stables.
When their complaint went unheeded, the racehorse owners
lodged a complaint before the Office of the President (OP) which
in turn issued a directive instructing Philracom to investigate the
matter.
For failure of Philracom to act upon the directive of the OP,
petitioners filed a petition for injunction with application for the
issuance

of

temporary

restraining

order

(TRO). In

an

order[9] dated 11 November 2004, the trial court issued a TRO.

Dagan refused to comply with the directives because, according

to him, the same are unfair as there are no implementing rules
on the banning of sick horses from races. Consequently, his
horses were evicted from the stables and transferred to an

isolation area. He also admitted that three of his horses had been
found positive for EIA.[10]
Confronted with two issues, namely: whether there were valid
grounds for the issuance of a writ of injunction and whether
respondents

had

acted

with

whim

and

caprice

in

the

implementation of the contested guideline, the trial court resolved

both queries in the negative.
The trial court found that most racehorse owners, except for
Dagan,

had

already

subjected

their

racehorses

to

EIA

testing. Their act constituted demonstrated compliance with the

contested guidelines, according to the trial court. Hence, the acts
sought to be enjoined had been rendered moot and academic.
With respect to the subject guidelines, the trial court upheld their
validity as an exercise of police power, thus:
The Petitioners submission that the subject
guidelines are oppressive and hence confiscatory of
proprietary rights is likewise viewed by this Court to be
barren of factual and legal support. The horseracing
industry, needless to state, is imbued with public interest
deserving of utmost concern if not constant vigilance. The
Petitioners do not dispute this. It is because of this basic
fact that respondents are expected to police the
concerned individuals and adopt measures that will
promote and protect the interests of all the stakeholders
starting from the moneyed horse-owners, gawking
bettors down to the lowly maintainers of the stables. This
is a clear and valid exercise of police power with the
respondents acting for the State. Participation in the
business of horseracing is but a privilege; it is not a
right. And no clear acquiescence to this postulation can

there be than the Petitioners' own undertaking to abide

by the rules and conditions issued and imposed by the
respondents as specifically shown by their contracts of
lease with MCJI.[11]

Petitioners appealed to the Court of Appeals. In its Decision

dated 27 October 2006, the appellate court affirmed in toto the
decision of the trial court.
The appellate court upheld the authority of Philracom to
formulate guidelines since it is vested with exclusive jurisdiction
over and control of the horse-racing industry per Section 8 of
Presidential Decree (P.D.) No. 8. The appellate court further
pointed out that P.D. No. 420 also endows Philracom with the
power to prescribe additional rules and regulations not otherwise
inconsistent with the said presidential decree [12] and to perform
such duties and exercise all powers incidental or necessary to the
accomplishment

of

its

aims

and

objectives. [13] It

similarly

concluded that the petition for prohibition should be dismissed on

the ground of mootness in light of evidence indicating that
petitioners had already reconsidered their refusal to have their
horses tested and had, in fact, subsequently requested the
administration of the test to the horses.[14]

Aggrieved by the appellate courts decision, petitioners filed

the instant certiorari petition[15]imputing grave abuse of discretion

on the part of respondents in compelling petitioners to subject

their racehorses to blood testing.
In

their

amended

petition,[16] petitioners

allege

that

Philracoms unsigned and undated implementing guidelines suffer

from

several

guidelines

infirmities. They
do

not

maintain

comply

with

that

the
due

assailed
process

requirements. Petitioners insist that racehorses already in the

MJCI stables were allowed to be so quartered because the
individual horse owners had already complied with the Philracom
regulation that horses should not bear any disease. There was
neither a directive nor a rule that racehorses already lodged in
the stables of the racing clubs should again be subjected to the
collection of blood samples preparatory to the conduct of the EIA
tests,[17] petitioners note. Thus, it came as a surprise to horse
owners when told about the administration of a new Coggins
Tests on old horses since the matter had not been taken up with
them.[18] No investigation or at least a summary proceeding was
conducted affording petitioners an opportunity to be heard.
[19]

Petitioners also aver that the assailed guidelines are ultra

vires in that the sanctions imposed for refusing to submit to

medical examination are summary eviction from the stables or
arbitrary banning of participation in the races, notwithstanding
the penalties prescribed in the contract of lease.[20]
In its Comment,[21] the PRCI emphasizes that it merely
obeyed the terms of its franchise and abided by the rules enacted
by Philracom.[22] For its part, Philracom, through the Office of the
Solicitor-General (OSG), stresses that the case has become moot

and academic since most of petitioners had complied with the

guidelines by subjecting their race horses to EIA testing. The
horses found unafflicted with the disease were eventually allowed
to

join

the

races.[23] Philracom

under the law to regulate

horse

also

justified

racing.[24] MJCI

its

right

adds

that

Philracom need
not delegate its rule-making power to the former since MJCIs
right to formulate its internal rules is subsumed under the
franchise granted to it by Congress.[25]
In their Reply,[26] petitioners raise for the first time the issue that
Philracom had unconstitutionally delegated its rule-making power
to PRCI and MJCI in issuing the directive for them to come up
with club rules. In response to the claim that respondents had
merely

complied

with

their

duties

under

their

franchises,

petitioners counter that the power granted to PRCI and MJCI

under

their

respective

franchises

is

limited

to:

(1)

the

construction, operation and maintenance of racetracks; (2) the

establishment of branches for booking purposes; and (3) the
conduct of horse races.
It appears on record that only Dagan had refused to comply
with the orders of respondents.Therefore, the case subsists as
regards Dagan.
Petitioners essentially assail two issuances of Philracom;
namely: the Philracom directive[27]and the subsequent guidelines
addressed to MJCI and PRCI.

The validity of an administrative issuance, such as the

assailed guidelines, hinges on compliance with the following
requisites:
1. Its promulgation must be authorized by the legislature;
2. It

must

be

promulgated

in

accordance

with

the

prescribed procedure;
3. It must be within the scope of the authority given by the
legislature;
4. It must be reasonable.[28]

All the prescribed requisites are met as regards the

questioned issuances. Philracoms authority is drawn from P.D. No.
420. The delegation made in the presidential decree is valid.
Philracom did not exceed its authority. And the issuances are fair
and reasonable.

The rule is that what has been delegated cannot be

delegated, or as expressed in the Latin maxim: potestas delegate
non delegare potest. This rule is based upon the ethical principle
that such delegated power constitutes not only a right but a duty
to be performed by the delegate by the instrumentality of his own
judgment acting immediately upon the matter of legislation and
not through the intervening mind of another.[29] This rule however
admits of recognized exceptions[30] such as the grant of rule-

making

power

to

administrative

agencies. They

have

been

granted by Congress with the authority to issue rules to regulate

the implementation of a law entrusted to them. Delegated rulemaking has become a practical necessity in modern governance
due to the increasing complexity and variety of public functions.
[31]

However, in every case of permissible delegation, there must

be a showing that the delegation itself is valid. It is valid only if
the law (a) is complete in itself, setting forth therein the policy to
be executed, carried out, or implemented by the delegate; and
(b) fixes a standardthe limits of which are sufficiently determinate
and determinableto which the delegate must conform in the
performance of his functions. A sufficient standard is one which
defines legislative policy, marks its limits, maps out its boundaries
and specifies the public agency to apply it. It indicates the
circumstances under which the legislative command is to be
effected.[32]
P.D. No. 420 hurdles the tests of completeness and
standards sufficiency.
Philracom was created for the purpose of carrying out the
declared policy in Section 1 which is to promote and direct the
accelerated development and continued growth of horse racing
not only in pursuance of the sports development program but
also in order to insure the full exploitation of the sport as a
source of revenue and employment. Furthermore, Philracom was

granted exclusive jurisdiction and control over every aspect of the

conduct of horse racing, including the framing and scheduling of
races, the construction and safety of race tracks, and the
security of racing. P.D. No. 420 is already complete in itself.
Section 9 of the law fixes the standards and limitations to
which

Philracom must conform in

the performance of its

functions, to wit:
Section
9.
Specific
Powers. Specifically,
Commission shall have the power:
a.

b.
c.

d.

e.

f.

the

To enforce all laws, decrees and executive

orders relating to horse-racing that are not
expressly or implied repealed or modified by this
Decree, including all such existing rules and
regulations until otherwise modified or amended by
the Commission;
To prescribe additional rules and regulations not
otherwise inconsistent with this Decree;
To register race horses, horse owners or
associations or federations thereof, and to
regulate the construction of race tracks and to
grant permit for the holding of races;
To issue, suspend or revoke permits and
licenses and to impose or collect fees for the
issuance of such licenses and permits to persons
required to obtain the same;
To review, modify, approve or disapprove the
rules and regulations issued by any person or
entity concerning the conduct of horse races held
by them;
To supervise all such race meeting to assure
integrity
at
all
times. It
can order
the
suspension of any racing event in case of

g.

h.
i.

j.

violation of any law, ordinance or rules and

regulations;
To prohibit the use of improper devices,
drugs, stimulants or other means to enhance
or diminish the speed of horse or materially
harm their condition;
To approve the annual budget of the omission
and such supplemental budgets as may be
necessary;
To appoint all personnel, including an Executive
Director of the Commission, as it may be deem
necessary in the exercise and performance of its
powers and duties; and
To enter into contracts involving obligations
chargeable to or against the funds of the
Commission. (Emphasis supplied)

Clearly, there is a proper legislative delegation of rulemaking power to Philracom. Clearly too, for its part Philracom has
exercised its rule-making power in a proper and reasonable
manner. More specifically, its discretion to rid the facilities of MJCI
and PRCI of horses afflicted with EIA is aimed at preserving the
security and integrity of horse races.
Petitioners

also

question

the

supposed

delegation

by

Philracom of its rule-making powers to MJCI and PRCI.

There is no delegation of power to speak of between
Philracom, as the delegator and MJCI and PRCI as delegates. The
Philracom directive is merely instructive in character. Philracom
had instructed PRCI and MJCI to immediately come up with Clubs
House Rule to address the problem and rid their facilities of

horses infected with EIA. PRCI and MJCI followed-up when they
ordered the racehorse owners to submit blood samples and
subject their race horses to blood testing.Compliance with the
Philracoms directive is part of the mandate of PRCI and MJCI
under Sections 1[33] of R.A. No. 7953[34] and Sections 1[35] and
2[36] of 8407.[37]

As correctly proferred by MJCI, its duty is not derived from

the delegated authority of Philracom but arises from the franchise
granted to them by Congress allowing MJCI to do and carry out
all such acts, deeds and things as may be necessary to give effect
to the foregoing.[38] As justified by PRCI, obeying the terms of the
franchise and abiding by whatever rules enacted by Philracom is
its duty.[39]
More on the second, third and fourth requisites.
As to the second requisite, petitioners raise some infirmities
relating to Philracoms guidelines. They question the supposed
belated issuance of the guidelines, that is, only after the
collection

of

blood

samples

for

the Coggins

Test was

ordered. While it is conceded that the guidelines were issued a

month after Philracoms directive, this circumstance does not
render the directive nor the guidelines void. The directives validity
and

effectivity

are

not

dependent

on

any

supplemental

guidelines.Philracom has every right to issue directives to MJCI

and PRCI with respect to the conduct of horse racing, with or

without implementing guidelines.
Petitioners also argue that Philracoms guidelines have no
force and effect for lack of publication and failure to file copies
with the University of the Philippines (UP) Law Center as required
by law.
As a rule, the issuance of rules and regulations in the
exercise of an administrative agency of its quasi-legislative power
does not require notice 7and hearing.[40] In Abella, Jr. v. Civil
Service Commission,[41] this Court had the occasion to rule that
prior notice and hearing are not essential to the validity of rules
or regulations issued in the exercise of quasi-legislative powers
since there is no determination of past events or facts that have
to be established or ascertained.[42]
The third requisite for the validity of an administrative
issuance is that it must be within the limits of the powers granted
to it. The administrative body may not make rules and regulations
which are inconsistent with the provisions of the Constitution or a
statute, particularly the statute it is administering or which
created it, or which are in derogation of, or defeat, the purpose of
a statute.[43]
The

assailed

guidelines

prescribe

the

procedure

for

monitoring and eradicating EIA. These guidelines are in accord

with Philracoms mandate under the law to regulate the conduct of
horse racing in the country.

Anent the fourth requisite, the assailed guidelines do not

appear to be unreasonable or discriminatory. In fact, all horses
stabled at the MJCI and PRCIs premises underwent the same
procedure. The

guidelines

implemented

were

undoubtedly

reasonable as they bear a reasonable relation to the purpose

sought to be accomplished, i.e., the complete riddance of horses
infected with EIA.
It also appears from the records that MJCI properly notified
the racehorse owners before the test was conducted. [44] Those
who

failed

to

comply

were

repeatedly

warned

of

certain

consequences and sanctions.

Furthermore, extant from the records are circumstances
which allow respondents to determine from time to time the
eligibility of horses as race entries. The lease contract executed
between petitioner and MJC contains a proviso reserving the right
of the lessor, MJCI in this case, the right to determine whether a
particular horse is a qualified horse. In addition, Philracoms rules
and regulations on horse racing provide that horses must be free
from any contagious disease or illness in order to be eligible as
race entries.
All told, we find no grave abuse of discretion on the part of
Philracom in issuing the contested guidelines and on the part
MJCI and PRCI in complying with Philracoms directive.

WHEREFORE, the petition is DISMISSED. Costs against

petitioner William Dagan.
SO ORDERED.

HON. EXECUTIVE SECRETARY, et al. v. SOUTHWING HEAVY INDUSTRIES,

INC., et al.
En Banc
Sirs/Mesdames:
Quoted hereunder, for your information, is a resolution of this Court dated AUG. 22,
2006
G.R. No. 164171 (Hon. Executive Secretary, et al. v. Southwing Heavy Industries, Inc.,
et al.);
G.R. No. 164172 (Hon. Executive Secretary, et al. v. Subic Integrated Macro Ventures
Corp., etc.);
G.R. No. 168741 (Hon. Executive Secretary, et al. v. Motor Vehicle Importers
Association of Subic Bay Freeport, Inc., etc.)
This resolves the separate Motions for Clarification and Reconsideration filed by
respondents Southwing Heavy Industries, Inc., (SOUTHWING), United Auctioneers, Inc.

(UNITED AUCTIONEERS), and Microvan, Inc. (MICROVAN); Subic Integrated Macro

Ventures Corporation (MACRO VENTURES); and Motor Vehicle Importers Association of
Subic Bay Freeport, Inc. (ASSOCIATION). Respondents seek a definite ruling on
whether used motor vehicles may now be imported into the Philippines in view of the
issuance on April 4, 2005 by the Office of the President of Executive Order (E.O.) No.
418, imposing an import duty of P500,000.00 on used motor vehicles, except trucks,
buses and special purpose vehicles. They contend that E.O. No. 418 impliedly repealed
E.O. No. 156 which prohibits the importation of used motor vehicles. They thus prayed
that the Court's Decision dated February 20, 2006 be reconsidered by clarifying that
used motor vehicles may now be imported into the country, subject only to the
payment of the additional import duty.
In its Motion for Partial Reconsideration, respondent ASSOCIATION claims that E.O. No.
156 is void because it failed to satisfy the requisites of a valid delegation of legislative
power, hence, importation of used motor vehicles should be allowed subject to the
payment of additional duties as provided in E.O. No. 418.
The motions are without merit.
In the February 20, 2006 Decision of the Court, we held that E.O. No. 156 which
imposes a ban on the importation of used motor vehicles is applicable only in the
Philippine territory outside the presently secured fenced-in former Subic Naval Base
area as stated in Section 1.1 of E.O. No. 97-A. Simply put, respondents may import
used motor vehicles into the presently secured fenced-in former Subic Naval Base area,
but since entry of said used motor vehicles is prohibited in other parts of the Philippine
territory, they may be stored, used or traded in the presently secured fenced-in former
Subic Naval Base area, or exported to other countries, but they cannot be introduced in
the other parts of the Philippine territory.
The subsequent issuance of E.O. No. 418 increasing the import duties on used motor
vehicles did not alter the policy of the executive department to prohibit the importation
of said vehicles. In his Comment, the Executive Secretary through the Solicitor General
stated a clear and unequivocal intention to ban the importation of used motor vehicles
into the country, notwithstanding the issuance of E.O. No. 418. Moreover, there is
nothing in the text of E.O. No. 418 which expressly repeals E.O. No. 156. The Congress,
or the Office of the President in this case, is presumed to know the existing laws, such
that whenever it intends to repeal a particular or specific provision of law, it does so
expressly. The failure to add a specific repealing clause indicates that the intent was not
to repeal previous administrative issuances.[1] In order to effect a repeal by implication,
the later statute must be so irreconcilably inconsistent and repugnant with the existing
law that they cannot be made to reconcile and stand together. The clearest case
possible must be made before the inference of implied repeal may be drawn, for
inconsistency is never presumed.[2] There must be showing of repugnance clear and
convincing in character. The language used in the later statute must be such as to
cralaw

cralaw

render it irreconcilable with what has been formerly enacted. An inconsistency that falls
short of that standard does not suffice. For it is a well settled rule in statutory
construction that repeal of statues by implication is not favored. [3]
cralaw

In the instant case, E.O. No. 156 is very explicit in its prohibition on the importation of
used motor vehicles. On the other hand, E.O. No. 418 merely modifies the tariff and
nomenclature rates of import duty on used motor vehicles. Nothing therein expressly
revokes the importation ban. The full text thereof, reads:
EXECUTIVE ORDER NO. 418
MODIFYING THE TARRIF NOMENCLATURE AND RATES OF IMPORT DUTY ON USED
MOTOR VEHICLES UNDER SECTION 104 OF THE TARIFF AND CUSTOMS CODE OF 1978
(PRESIDENTIAL DECREE NO. 1464, AS AMENDED)
WHEREAS, it is the policy of the State to maintain a balance between development and
environmental protection, and hence, between motorization and air quality
management.
WHEREAS, it is the policy of the State to protect the public against unreasonable risks
to injury associated with consumer products;
WHEREAS, there is a need to mitigate the impact of used motor vehicle trading on air
quality and road safety;
WHEREAS, Article II:1 (b) of the 1994 General Agreement on Tariffs and Trade allows
the unilateral imposition of other duties and charges on tariff items that were not
previously the subject of concession;
WHEREAS, motor vehicles were not covered by Schedule LXXV - Philippine Schedule of
Concessions and therefore, do not have tariff bindings;
WHEREAS, of Section 401 of the Tariff and Customs Code of 1978, as amended,
empowers the President of the Republic of the Philippines to increase, reduce, or
remove existing rates of import duty, as well as to modify the form of duty and the
tariff nomenclature under Section 104 of the Code;
NOW, THEREFORE, I, GLORIA MACAPAGAL ARROYO, President of the Republic of the
Philippines, by virtue of the powers vested in me by law, do hereby order[:]
SECTION 1. The articles specifically listed in Annex "A" hereof, as classified under
Section 104 of the Tariff and Customs Code of 1978, as amended, shall be subject to
the rates of import duty indicated opposite each article, except for trucks, buses and
special purpose vehicles.

SEC. 2. In addition to the regular rates of import duty, the articles specifically listed in
Annex "A" hereof, as classified under Section 104 of the Tariff and Customs Code of
1978, as amended, shall be subject to additional specific duty of PhP500,000.00.
SEC. 3. The amount of specific duty will be indexed by the Secretary of Finance once
every two (2) years if the change in the exchange rate of the Philippine peso against
the United States (U.S.) dollar is more than ten percent (10%) from the date of the
effectivity of this Order, in the case of initial adjustment and from the last revision date
in the case of subsequent adjustments.
In case the change in the exchange rate of the Philippine peso against the US dollar is
more than twenty percent (20%) at any time within the two-year period referred to
above, the Secretary of Finance shall index the amount by the full rate of depreciation
or appreciation, as the case may be.
SEC. 4. The following motor vehicles shall be considered "used" and shall be subject to
the duties herein prescribed: (a) all motor vehicles that have been sold, registered and
operated in the roads/highways of any foreign state or country; or (b) all imported
motor vehicles that has a mileage of more than 200 kilometers regardless of year
model.
SEC. 5. Upon the effectivity of this Executive Order, the articles, specifically listed in the
aforesaid Annex, which are entered and withdrawn from warehouses in the Philippines,
shall be levied the rates of import and specific duties herein prescribed.
SEC. 6. All Presidential issuances, administrative rules and regulations, or parts thereof,
which are inconsistent with this Executive Order are hereby revoked or modified
accordingly.
SEC. 7. This Executive Order shall take effect thirty (30) days following its complete
publication in two (2) newspapers of general circulation in the Philippines.
XXXX
The positive and categorical language of the proscription on the importation of used
motor vehicles and the clear intent of the executive department to enforce the ban can
only be superseded by another issuance revoking the same in terms so certain and
unmistakable that needs no further interpretation or construction. Since no such
express repeal is stated in E.O. No. 418, the conclusion is that the said executive
issuance did not supersede E.O. No. 156.
Where it is possible to do so, it is the duty of courts, in the construction of statutes, to
harmonize and reconcile them, and to adopt a construction which reconciles them with
other statutory provisions. The fact that a later enactment may relate to the same

subject matter as that of an earlier statute is not of itself sufficient cause of an implied
repeal.[4] As asserted by petitioners, E.O. No. 418 is only a temporary measure to
address the influx of used motor vehicles in the country while E.O. No. 156 is under
legal challenge. With the categorical intent of the Office of the President to ban the
importation of used motor vehicles, E.O. No. 418 should be made operative only
pending the finality of this decision upholding the power of the President to ban the
importation of used motor vehicles. This way, we can give efficacy not only to the
executive policy proscribing the importation of used motor vehicles but also to the
executive issuance increasing the applicable import duties that would discourage the
entry into the country of the same vehicles pending the finality of this decision
sustaining the power of the President to issue an importation ban to protect the local
automotive industry.
cralaw

Likewise, the Motion for Partial Reconsideration of respondent ASSOCIATION must fail.
It argues that E.O. No. 156 is in effect extended to the Freeport because motor vehicle
importers can no longer continue their respective business if they cannot bring the
imported used motor vehicles into other parts of the Philippine territory. Respondent,
however, totally misses the point. While the presently secured fenced-in former Subic
Naval Base area enjoys the privilege of being considered as a "foreign territory," and
therefore, entry of used motor vehicles cannot be proscribed by E.O. No. 156, such
privilege should be construed as operative only within said area. Any movement or
entry of used motor vehicles to other parts of the Philippine territory would logically
subject said vehicles to the laws of the customs territory, specifically the importation
ban. To rule otherwise would be to put premium on the interest of a few businessmen
and to deprive the Congress or the President of the power to issue measures protective
of our domestic markets and air quality.
As exhaustively discussed in our February 20, 2006 Decision, the issuance of E.O. No.
156 has constitutional and statutory bases and the issuance thereof was in accordance
with the prescribed procedure. We also held therein that issuance of the ban to protect
the domestic industry and the environment including its air sheds against pollution from
mobile sources is a reasonable exercise of police power. Respondent ASSOCIATION's
contention that petitioners failed to prove that the importation of used motor vehicles
caused the deterioration of the local automotive industry lacks merit. Laws and other
administrative issuance enjoy the presumption of validity and the burden of proving its
invalidity rests upon those who assert the contrary.[5] It is therefore the obligation of
respondents and not of petitioners to show factual basis in support of their allegation
that E.O. No. 156 is void. However, respondents failed to do this because they moved
for rendition of summary judgment on the ground that there are no issues of facts
necessary to be resolved in the instant controversy.[6] Estoppel in presenting factual
basis in support of their argument operates against respondents. This Court is not a
trier of facts and the allegation of factual matters by the ASSOCIATION can no longer
be entertained.
cralaw

cralaw

ACCORDINGLY, respondents' separate motions for clarification and reconsideration

are DENIED. Notwithstanding the issuance of E.O. No. 418, used motor vehicles
imported via the presently secured fenced-in former Subic Naval Base area cannot
further be imported into the other parts of the Philippine territory. Used motor vehicles
may be imported into, stored, used, and traded within the presently secured fenced-in
former Subic Naval Base area, or exported to other countries, but entry thereof into the
other parts of the Philippine territory is prohibited pursuant to E.O. No. 156. (Corona,
J., On leave)
Very truly yours,

EN BANC
HOLY SPIRIT HOMEOWNERS G.R. No. 163980
ASSOCIATION, INC. and NESTORIO
F. APOLINARIO, in his personal
capacity and as President of Holy
Spirit Homeowners Association, Inc., Present:
Petitioners,
PANGANIBAN, C.J.,
- versus - PUNO,
QUISUMBING,
YNARES-SANTIAGO,
SECRETARY MICHAEL DEFENSOR, SANDOVAL-GUTIERREZ,
in his capacity as Chairman of the CARPIO,
Housing and Urban Development AUSTRIA-MARTINEZ,
Coordinating Council (HUDCC), CORONA,
ATTY. EDGARDO PAMINTUAN, CARPIO MORALES,
in his capacity as General Manager of CALLEJO, SR.,
the National Housing Authority (NHA), AZCUNA,
MR. PERCIVAL CHAVEZ, in his TINGA,
capacity as Chairman of the Presidential CHICO-NAZARIO,
Commission for the Urban Poor (PCUP), GARCIA, and
MAYOR FELICIANO BELMONTE, in VELASCO, JR., JJ.
his capacity as Mayor of Quezon City,
SECRETARY ELISEA GOZUN, in her
capacity as Secretary of the Department
of Environment and Natural Resources
(DENR) and SECRETARY FLORENTE Promulgated:
SORIQUEZ, in his capacity as Secretary
of the Department of Public Works and
Highways (DPWH) as ex-officio members
of the NATIONAL GOVERNMENT August 3, 2006
CENTER ADMINISTRATION
COMMITTEE,
Respondents.

x --------------------------------------------------------------------------------- x

DECISION
TINGA, J.:
The instant petition for prohibition under Rule 65 of the 1997
Rules of Civil Procedure, with prayer for the issuance of a
temporary restraining order and/or writ of preliminary injunction,
seeks to prevent respondents from enforcing the implementing
rules and regulations (IRR) of Republic Act No. 9207, otherwise
known as the National Government Center (NGC) Housing and
Land Utilization Act of 2003.
Petitioner Holy Spirit Homeowners Association, Inc. (Association)
is a homeowners association from the West Side of the NGC. It is
represented by its president, Nestorio F. Apolinario, Jr., who is a
co-petitioner in his own personal capacity and on behalf of the
association.
Named respondents are the ex-officio members of the National
Government Center Administration Committee (Committee). At
the filing of the instant petition, the Committee was composed of
Secretary Michael Defensor, Chairman of the Housing and Urban
Development

Coordinating

Council

(HUDCC),

Atty.

Edgardo

Pamintuan, General Manager of the National Housing Authority

(NHA),

Mr. Percival

Chavez,

Chairman

of

the

Presidential

Commission for Urban Poor (PCUP), Mayor Feliciano Belmonte of

Quezon City, Secretary Elisea Gozun of the Department of
Environment and Natural Resources (DENR), and Secretary
Florante Soriquez of the Department of Public Works and
Highways (DPWH).
Prior to the passage of R.A. No. 9207, a number of presidential
issuances authorized the creation and development of what is
now known as the National Government Center (NGC).
On March 5, 1972, former President Ferdinand Marcos
issued Proclamation No. 1826, reserving a parcel of land in
Constitution Hills, Quezon City, covering a little over 440 hectares
as a national government site to be known as the NGC.[1]
On August 11, 1987, then President Corazon Aquino issued
Proclamation No. 137, excluding 150 of the 440 hectares of the
reserved site from the coverage of Proclamation No. 1826 and
authorizing instead the disposition of the excluded portion by
direct sale to the bona fide residents therein.[2]
In view of the rapid increase in population density in the
portion excluded by Proclamation No. 137 from the coverage of
Proclamation No. 1826, former President Fidel Ramos issued
Proclamation No. 248 on September 7, 1993, authorizing the

vertical development of the excluded portion to maximize the

number of families who can effectively become beneficiaries of
the governments socialized housing program.[3]
On May 14, 2003, President Gloria Macapagal-Arroyo signed
into law R.A. No. 9207. Among the salient provisions of the law
are the following:

SEC. 2. Declaration of Policy. It is hereby declared the policy of

the State to secure the land tenure of the urban poor. Toward this end,
lands located in the NGC, Quezon City shall be utilized for housing,
socioeconomic, civic, educational, religious and other purposes.
SEC.
3. Disposition
of
Certain
Portions
of
the National Government Center Site
to
Bona
Fide
Residents.
Proclamation No. 1826, Series of 1979, is hereby amended by
excluding from the coverage thereof, 184 hectares on the west side
and 238 hectares on the east side of Commonwealth Avenue, and
declaring the same open for disposition to bona fide residents
therein: Provided, That the determination of the bona fide residents on
the west side shall be based on the census survey conducted in 1994
and the determination of the bona fide residents on the east side shall
be based on the census survey conducted in 1994 and occupancy
verification survey conducted in 2000: Provided, further, That all
existing legal agreements, programs and plans signed, drawn up or
implemented and actions taken, consistent with the provisions of this
Act are hereby adopted.
SEC. 4. Disposition
of
Certain
Portions
of
the National Government Center Site
for
Local
Government
or
Community Facilities, Socioeconomic, Charitable, Educational and
Religious Purposes. Certain portions of land within the aforesaid area
for local government or community facilities, socioeconomic,
charitable, educational and religious institutions are hereby reserved
for
disposition
for
such
purposes: Provided,
That
only
those institutions already operating and with existing facilities or
structures, or those occupying the land may avail of the disposition
program established under the provisions this Act; Provided, further,

That in ascertaining the specific areas that may be disposed of in favor

of these institutions, the existing site allocation shall be used as basis
therefore: Provided, finally. That in determining the reasonable lot
allocation of such institutionswithout specific lot allocations, the land
area that may be allocated to them shall be based on the area actually
used by said institutions at the time of effectivity of this Act.
(Emphasis supplied.)

In accordance with Section 5 of R.A. No. 9207, [4] the

Committee formulated the Implementing Rules and Regulations
(IRR)

of

R.A.

No.

9207

on June

29,

2004.

Petitioners

subsequently filed the instant petition, raising the following

issues:
WHETHER OR NOT SECTION 3.1 (A.4), 3.1 (B.2), 3.2 (A.1) AND
3.2 (C.1) OF THE RULES AND REGULATIONS OF REPUBLIC ACT NO.
9207, OTHERWISE KNOWN AS NATIONAL GOVERNMENT CENTER
(NGC) HOUSING AND LAND UTILIZATION ACT OF 2003 SHOULD BE
DECLARED NULL AND VOID FOR BEING INCONSISTENT WITH THE
LAW IT SEEKS TO IMPLEMENT.
WHETHER OR NOT SECTION 3.1 (A.4), 3.1 (B.2), 3.2 (A.1) AND
3.2 (C.1) OF THE RULES AND REGULATIONS OF REPUBLIC ACT NO.
9207, OTHERWISE KNOWN AS NATIONAL GOVERNMENT CENTER
(NGC) HOUSING AND LAND UTILIZATION ACT OF 2003 SHOULD BE
DECLARED NULL AND VOID FOR BEING ARBITRARY, CAPRICIOUS AND
WHIMSICAL.[5]

First, the procedural matters.

The Office of the Solicitor General (OSG) argues that
petitioner Association cannot question the implementation of
Section 3.1 (b.2) and Section 3.2 (c.1) since it does not claim any
right over the NGC East Side. Section 3.1 (b.2) provides for the
maximum lot area that may be awarded to a resident-beneficiary
of the NGC East Side, while Section 3.2 (c.1) imposes a lot price

escalation penalty to a qualified beneficiary who fails to execute a

contract to sell within the prescribed period. [6] Also, the OSG
contends that since petitioner association is not the duly
recognized peoples organization in the NGC and since petitioners
not qualify as beneficiaries, they cannot question the manner of
disposition of lots in the NGC.[7]
Legal standing or locus standi has been defined as a
personal and substantial interest in the case such that the party
has sustained or will sustain direct injury as a result of the
governmental act that is being challenged. The gist of the
question of standing is whether a party alleges such personal
stake in the outcome of the controversy as to assure that
concrete adverseness which sharpens the presentation of issues
upon which the court depends for illumination of difficult
constitutional questions.[8]
Petitioner association has the legal standing to institute the
instant petition, whether or not it is the duly recognized
association of homeowners in the NGC. There is no dispute that
the individual members of petitioner association are residents of
the NGC. As such they are covered and stand to be either
benefited or injured by the enforcement of the IRR, particularly
as regards the selection process of beneficiaries and lot allocation
to qualified beneficiaries. Thus, petitioner association may assail
those provisions in the IRR which it believes to be unfavorable to
the rights of its members. Contrary to the OSGs allegation that

the failure of petitioner association and its members to qualify as

beneficiaries

effectively

bars

them

from

questioning

the

provisions of the IRR, such circumstance precisely operates to

confer on them the legal personality to assail the IRR. Certainly,
petitioner and its members have sustained direct injury arising
from the enforcement of the IRR in that they have been
disqualified and eliminated from the selection process. While it is
true that petitioners claim rights over the NGC West Side only
and thus cannot be affected by the implementation of Section 3.1
(b.2), which refers to the NGC East Side, the rest of the assailed
provisions of the IRR, namely, Sections 3.1 (a.4), 3.2 (a.1) and
3.2 (c.1), govern the disposition of lots in the West Side itself or
all the lots in the NGC.

We cannot, therefore, agree with the OSG on the issue

of locus standi. The petition does not merit dismissal on that
ground.
There are, however, other procedural impediments to the
granting of the instant petition. The OSG claims that the instant
petition for prohibition is an improper remedy because the writ of
prohibition does not lie against the exercise of a quasi-legislative

function.[9] Since in issuing the questioned IRR of R.A. No. 9207,

the Committee was not exercising judicial, quasi-judicial or
ministerial function, which is the scope of a petition for
prohibition under Section 2, Rule 65 of the 1997 Rules of Civil
Procedure, the instant prohibition should be dismissed outright,
the OSG contends. For their part, respondent Mayor of Quezon
City[10] and respondent NHA[11] contend that petitioners violated
the doctrine of hierarchy of courts in filing the instant petition
with this Court and not with the Court of Appeals, which has
concurrent jurisdiction over a petition for prohibition.
The cited breaches are mortal. The petition deserves to be
spurned as a consequence.
Administrative agencies possess quasi-legislative or rulemaking powers and quasi-judicial or administrative adjudicatory
powers. Quasi-legislative or rule-making power is the power to
make rules and regulations which results in delegated legislation
that is within the confines of the granting statute and the doctrine
of non-delegability and separability of powers.[12]
In questioning the validity or constitutionality of a rule or
regulation issued by an administrative agency, a party need not
exhaust administrative remedies before going to court. This
principle,

however,

applies

only

where

the

act

of

the

administrative agency concerned was performed pursuant to its

quasi-judicial function, and not when the assailed act pertained to

its rule-making or quasi-legislative power.[13]
The assailed IRR was issued pursuant to the quasi-legislative
power of the Committee expressly authorized by R.A. No. 9207.
The petition rests mainly on the theory that the assailed IRR
issued by the Committee is invalid on the ground that it is not
germane to the object and purpose of the statute it seeks to
implement.

Where

constitutionality

of

what
a

rule

is

assailed
or

is

regulation

the

validity

issued

by

or
the

administrative agency in the performance of its quasi-legislative

function, the regular courts have jurisdiction to pass upon the
same.[14]
Since the regular courts have jurisdiction to pass upon the
validity of the assailed IRR issued by the Committee in the
exercise of its quasi-legislative power, the judicial course to assail
its validity must follow the doctrine of hierarchy of courts.
Although the Supreme Court, Court of Appeals and the Regional
Trial

Courts

of certiorari,

have

concurrent

jurisdiction

prohibition,mandamus, quo

to

issue

writs

warranto, habeas

corpus and injunction, such concurrence does not give the

petitioner unrestricted freedom of choice of court forum.[15]
True, this Court has the full discretionary power to take
cognizance of the petition filed directly with it if compelling
reasons, or the nature and importance of the issues raised, so

warrant.[16] A direct invocation of the Courts original jurisdiction to

issue these writs should be allowed only when there are special
and important reasons therefor, clearly and specifically set out in
the petition.[17]
In Heirs of Bertuldo Hinog v. Melicor,[18] the Court said that it
will not entertain direct resort to it unless the redress desired
cannot be obtained in the appropriate courts, and exceptional and
compelling circumstances, such as cases of national interest and
of serious implications, justify the availment of the extraordinary
remedy of writ of certiorari, calling for the exercise of its primary
jurisdiction.[19] A perusal, however, of the petition for prohibition
shows no compelling, special or important reasons to warrant the
Courts taking cognizance of the petition in the first instance.
Petitioner also failed to state any reason that precludes the lower
courts from passing upon the validity of the questioned IRR.
Moreover, as provided in Section 5, Article VIII of the

Constitution,[20] the Courts power to evaluate the validity of

an implementing rule or regulation is generally appellate in
nature. Thus, following the doctrine of hierarchy of courts, the
instant petition should have been initially filed with the Regional
Trial Court.
A petition for prohibition is also not the proper remedy to
assail an IRR issued in the exercise of a quasi-legislative function.
Prohibition is an extraordinary writ directed against any tribunal,

corporation, board, officer or person, whether exercising judicial,

quasi-judicial or ministerial functions, ordering said entity or
person to desist from further proceedings when said proceedings
are without or in excess of said entitys or persons jurisdiction, or
are accompanied with grave abuse of discretion, and there is no
appeal or any other plain, speedy and adequate remedy in the
ordinary course of law.[21] Prohibition lies against judicial or
ministerial

functions,

but

not

legislative

functions.

Generally,

against
the

legislative

purpose

of

or
a

quasiwrit

of

prohibition is to keep a lower court within the limits of its

jurisdiction in order to maintain the administration of justice in
orderly channels.[22] Prohibition is the proper remedy to afford
relief against usurpation of jurisdiction or power by an inferior
court, or when, in the exercise of jurisdiction in handling matters
clearly within its cognizance the inferior court transgresses the
bounds prescribed to it by the law, or where there is no adequate
remedy available in the ordinary course of law by which such
relief can be obtained.[23]Where the principal relief sought is to
invalidate an IRR, petitioners remedy is an ordinary action for its
nullification, an action which properly falls under the jurisdiction
of the Regional Trial Court. In any case, petitioners allegation that
respondents are performing or threatening to perform functions
without or in excess of their jurisdiction may appropriately be
enjoined by the trial court through a writ of injunction or a
temporary restraining order.

In a number of petitions,[24] the Court adequately resolved

them

on

other

grounds

without

adjudicating

on

the

constitutionality issue when there were no compelling reasons to

pass upon the same. In like manner, the instant petition may be
dismissed based on the foregoing procedural grounds. Yet, the
Court will not shirk from its duty to rule on the merits of this
petition to facilitate the speedy resolution of this case. In proper
cases, procedural rules may be relaxed or suspended in the
interest of substantial justice. And the power of the Court to
except a particular case from its rules whenever the purposes of
justice require it cannot be questioned.[25]
Now, we turn to the substantive aspects of the petition. The
outcome, however, is just as dismal for petitioners.
Petitioners assail the following provisions of the IRR:

Section 3. Disposition of Certain portions of the NGC Site to the

bonafide residents
3.1. Period for Qualification of Beneficiaries
xxxx
(a.4) Processing and evaluation of qualifications shall be based on the
Code of Policies and subject to the condition that a beneficiary is
qualified to acquire only one (1) lot with a minimum of 36 sq. m. and
maximum of 54 sq. m. and subject further to the availability of lots.
xxxx

(b.2) Applications for qualification as beneficiary shall be

processed and evaluated based on the Code of Policies including the
minimum and maximum lot allocation of 35 sq. m. and 60 sq. m.
xxxx
3.2. Execution of the Contract to Sell
(a) Westside
(a.1) All qualified beneficiaries shall execute Contract to
Sell (CTS) within sixty (60) days from the effectivity of the IRR
in order to avail of the lot at P700.00 per sq. m.
xxxx
(c) for both eastside and westside
(c.1) Qualified beneficiaries who failed to execute CTS on
the deadline set in item a.1 above in case of westside and in
case of eastside six (6) months after approval of the subdivision
plan shall be subjected to lot price escalation.
The rate shall be based on the formula to be set by the
National Housing Authority factoring therein the affordability
criteria. The new rate shall be approved by the NGCAdministration Committee (NGC-AC).

Petitioners contend that the aforequoted provisions of the

IRR are constitutionally infirm as they are not germane to and/or
are in conflict with the object and purpose of the law sought to be
implemented.
First. According to petitioners, the limitation on the areas to
be awarded to qualified beneficiaries under Sec. 3.1 (a.4) and
(b.2) of the IRR is not in harmony with the provisions of R.A. No.
9207, which mandates that the lot allocation to qualified
beneficiaries shall be based on the area actually used or occupied

by bona fide residents without limitation to area. The argument is

utterly baseless.

The beneficiaries of lot allocations in the NGC may be

classified into two groups, namely, the urban poor or the bona
fide residents within the NGC site and certain government
institutions including the local government. Section 3, R.A. No.
9207 mandates the allocation of additional property within the
NGC for disposition to its bona fide residents and the manner by
which this area may be distributed to qualified beneficiaries.
Section 4, R.A. No. 9207, on the other hand, governs the lot
disposition to government institutions. While it is true that
Section 4 of R.A. No. 9207 has a proviso mandating that the lot
allocation shall be based on the land area actually used or
occupied at the time of the laws effectivity, this proviso applies
only

to

institutional

beneficiaries

consisting

of

the

local

government, socioeconomic, charitable, educational and religious

institutions which do not have specific lot allocations, and not to
the bona fide residents of NGC. There is no proviso which even
hints that a bona fide resident of the NGC is likewise entitled to
the lot area actually occupied by him.
Petitioners interpretation is also not supported by the policy
of R.A. No. 9207 and the prior proclamations establishing the
NGC. The governments policy to set aside public property aims to
benefit not only the urban poor but also the local government and

various

government

institutionsdevoted to socioeconomic, charitable, educational and

religious

purposes.[26] Thus,

although

Proclamation

No.

137

authorized the sale of lots to bona fideresidents in the NGC, only

a third of the entire area of the NGC was declared open for
disposition subject to the condition that those portions being used
or earmarked for public or quasi-public purposes would be
excluded from the housing program for NGC residents. The same
policy

ofrational and optimal land

use

can

be

read

in

Proclamation No. 248 issued by then President Ramos. Although

the proclamation recognized the rapid increase in the population
density in the NGC, it did not allocate additional property within
the NGC for urban poor housing but instead authorized the
vertical

development

of

the

same

150

hectares

identified

previously by Proclamation No. 137 since the distribution of

individual lots would not adequately provide for the housing
needs of all the bona fide residents in the NGC.
In addition, as provided in Section 4 of R.A. No. 9207, the
institutional beneficiaries shall be allocated the areas actually
occupied

by

them;

hence,

the

portions

intended

for

the

institutional beneficiaries is fixed and cannot be allocated for

other non-institutional beneficiaries. Thus, the areas not intended
for

institutional

beneficiaries

would

have

to

be

equitably

distributed among the bona fideresidents of the NGC. In order to

accommodate all qualified residents, a limitation on the area to
be awarded to each beneficiary must be fixed as a necessary
consequence.
Second. Petitioners note that while Sec. 3.2 (a.1) of the IRR
fixes the selling rate of a lot atP700.00 per sq. m., R.A. No. 9207
does not provide for the price. They add Sec. 3.2 (c.1) penalizes
a beneficiary who fails to execute a contract to sell within six (6)
months from the approval of the subdivision plan by imposing a
price escalation, while there is no such penalty imposed by R.A.
No. 9207. Thus, they conclude that the assailed provisions
conflict with R.A. No. 9207 and should be nullified. The argument
deserves scant consideration.
Where a rule or regulation has a provision not expressly
stated or contained in the statute being implemented, that
provision does not necessarily contradict the statute. A legislative
rule is in the nature of subordinate legislation, designed to
implement a primary legislation by providing the details thereof.
[27]

All that is required is that the regulation should be germane to

the objects and purposes of the law; that the regulation be not in
contradiction to but in conformity with the standards prescribed
by the law.[28]
In Section 5 of R.A. No. 9207, the Committee is granted the
power to administer, formulate guidelines and policies, and

implement the disposition of the areas covered by the law.

Implicit in this authority and the statutes objective of urban poor
housing is the power of the Committee to formulate the manner
by which the reserved property may be allocated to the
beneficiaries.

Under

this

broad

power,

the

Committee

is

mandated to fill in the details such as the qualifications of

beneficiaries, the selling price of the lots, the terms and
conditions governing the sale and other key particulars necessary
to implement the objective of the law. These details are purposely
omitted from the statute and their determination is left to the
discretion of the Committee because the latter possesses special
knowledge and technical expertise over these matters.
The Committees authority to fix the selling price of the lots
may be likened to the rate-fixing power of administrative
agencies. In case of a delegation of rate-fixing power, the only
standard which the legislature is required to prescribe for the
guidance of the administrative authority is that the rate be
reasonable and just. However, it has been held that even in the
absence of an express requirement as to reasonableness, this
standard may be implied.[29] In this regard, petitioners do not
even claim that the selling price of the lots is unreasonable.
The provision on the price escalation clause as a penalty
imposed to a beneficiary who fails to execute a contract to sell
within the prescribed period is also within the Committees
authority to formulate guidelines and policies to implement R.A.

No. 9207. The Committee has the power to lay down the terms
and conditions governing the disposition of said lots, provided
that these are reasonable and just. There is nothing objectionable
about prescribing a period within which the parties must execute
the contract to sell. This condition can ordinarily be found in a
contract to sell and is not contrary to law, morals, good customs,
public order, or public policy.
Third. Petitioners also suggest that the adoption of the
assailed IRR suffers from a procedural flaw. According to them
the IRR was adopted and concurred in by several representatives
of peoples organizations contrary to the express mandate of R.A.
No. 9207 that only two representatives from duly recognized
peoples

organizations

must

compose

the

NGCAC

which

promulgated the assailed IRR. It is worth noting that petitioner

association is not a duly recognized peoples organization.
In subordinate legislation, as long as the passage of the rule
or regulation had the benefit of a hearing, the procedural due
process requirement is deemed complied with. That there is
observance of more than the minimum requirements of due
process in the adoption of the questioned IRR is not a ground to
invalidate the same.
In sum, the petition lacks merit and suffers from procedural
deficiencies.

WHEREFORE,

the

instant

petition

DISMISSED. Costs against petitioners.

SO ORDERED.

for

prohibition

is

Republic of the Philippines

Supreme Court
Manila

EN BANC
ATTY.
ORCEO,

REYNANTE

Petitioner,

B.

G.R. No. 190779

Present:

PUNO, C.J.,*
CARPIO,**
CORONA,
CARPIO MORALES,
VELASCO, JR.,
NACHURA,
LEONARDO-DE CASTRO,
- versus -

BRION,
PERALTA,
BERSAMIN,
DEL CASTILLO,
ABAD,

VILLARAMA, JR.,
PEREZ, and
MENDOZA, JJ.

Promulgated:
COMMISSION ON
ELECTIONS,

March 26, 2010

Respondent.
x--------------------------------------------------------------------------------------x

DECISION

PERALTA, J.:

This is a petition for certiorari[1] questioning the validity

of Resolution No. 8714 insofar as it provides that the term
firearm includes airsoft guns and their replicas/imitations, which
results in their coverage by the gun ban during the election
period this year.

Resolution No. 8714 is entitled Rules and Regulations on

the: (1) Bearing, Carrying or Transporting of Firearms or other
Deadly Weapons; and (2) Employment, Availment or
Engagement of the Services of Security Personnel or Bodyguards,
During the Election Period for the May 10, 2010 National and
Local Elections. The Resolution was promulgated by the
Commission on Elections (COMELEC) on December 16, 2009, and
took effect on December 25, 2009.

Resolution No. 8714 contains the implementing rules and

regulations of Sec. 32 (Who May Bear Firearms) and Section 33
(Security Personnel and Bodyguards) of Republic Act (R.A.) No.
7166, entitled An Act Providing for Synchronized National and
Local Elections and for Electoral Reforms, Authorizing
Appropriations Therefor, and for Other Purposes.

Section 1 of Resolution No. 8714 prohibits an unauthorized

person from bearing, carrying or transporting firearms or other
deadly weapons in public places, including all public buildings,
streets, parks, and private vehicles or public conveyances, even if
licensed to possess or carry the same, during the election period.

Under Section 2 (b) of Resolution No. 8714, the term firearm

includes airgun, airsoft guns, and their replica/imitation in
whatever form that can cause an ordinary person to believe that
they are real.Hence, airsoft guns and their replicas/imitations are

included in the gun ban during the election period from January
10, 2010 to June 9, 2010.
Petitioner claims that he is a real party-in-interest, because
he has been playing airsoft since the year 2000. The continuing
implementation of Resolution No. 8714 will put him in danger of
sustaining direct injury or make him liable for an election
offense[2] if caught in possession of an airsoft gun and its
replica/imitation in going to and from the game site and playing
the sport during the election period.

Petitioner contends that the COMELEC gravely abused its

discretion amounting to lack or excess of jurisdiction in
including airsoft guns and their replicas/imitations in the
definition of firearm in Resolution No. 8714, since there is nothing
in R.A. No. 7166 that mentions airsoft guns and their
replicas/imitations. He asserts that the intendment of R.A. No.
7166 is that the term firearm refers to real firearm in its common
and ordinary usage. In support of this assertion, he cites the
Senate deliberation on the bill,[3] which later became R.A. No.
7166, where it was clarified that an unauthorized person caught
carrying a firearm during the election period is guilty of an
election offense under Section 261 (q) of the Omnibus Election
Code.

Further, petitioner alleges that there is no law that covers

airsoft guns. By including airsoft guns in the definition of firearm,
Resolution No. 8714, in effect, criminalizes the sport, since the

possession of an airsoft gun or its replica/imitation is now an

election offense, although there is still no law that governs the
use thereof.

Petitioner prays that the Court render a decision as

follows: (1) Annulling Resolution No. 8714 insofar as it includes
airsoft guns and their replicas/imitations within the meaning of
firearm, and declaring the Resolution as invalid; (2) ordering the
COMELEC to desist from further implementing Resolution No.
8714 insofar as airsoft guns and their replicas/imitations are
concerned; (3) ordering the COMELEC to amend Resolution No.
8714 by removing airsoft guns and their replicas/imitations within
the meaning of firearm; and (4) ordering the COMELEC to issue a
Resolution directing the Armed Forces of the Philippines,
Philippine National Police and other law enforcement agencies
deputized by the COMELEC to desist from further enforcing
Resolution No. 8714 insofar as airsoft guns and their
replicas/imitations are concerned.
The main issue is whether or not the COMELEC gravely
abused its discretion in including airsoft guns and their
replicas/imitations in the term firearm in Section 2 (b) of R.A. No.
8714.

The Court finds that the COMELEC did not commit grave
abuse of discretion in this case.

R.A. No. 7166 (An Act Providing for Synchronized National

and Local Elections and for Electoral Reforms, Authorizing
Appropriations Therefor, and for Other Purposes)[4] provides:
SEC. 32. Who May Bear Firearms. During the
election period, no person shall bear, carry or transport
firearms or other deadly weapons in public places,
including any building, street, park, private vehicle or
public conveyance, even if licensed to possess or carry the
same, unless authorized in writing by the Commission. The
issuance of firearms licenses shall be suspended during the
election period.

Only regular members or officers of the Philippine

National Police, the Armed Forces of the Philippines and
other law enforcement agencies of the Government who
are duly deputized in writing by the Commission for
election duty may be authorized to carry and possess
firearms during the election period: Provided, That, when
in the possession of firearms, the deputized law
enforcement officer must be: (a) in full uniform showing
clearly and legibly his name, rank and serial number, which
shall remain visible at all times; and (b) in the actual
performance of his election duty in the specific area
designated by the Commission.

xxxx

SEC. 35. Rules and Regulations. The Commission shall

issue rules and regulations to implement this Act. Said rules shall
be published in at least two (2) national newspapers of general
circulation.

Pursuant to Section 35 of R.A. No. 7166, the COMELEC

promulgated Resolution
No.
8714,
which contains
the
implementing rules and regulations of Sections 32 and 33 of R.A.
No. 7166. The pertinent portion of the Resolution states:

NOW, THEREFORE, pursuant to the powers vested in

it by the Constitution of the Republic of the Philippines,
the Omnibus Election Code (B.P. Blg. 881), Republic Acts
Nos. 6646, 7166, 8189, 8436, 9189, 9369 and other
elections laws, the Commission RESOLVED, as it hereby
RESOLVES, to promulgate the following rules and
regulations to implement Sections 32 and 33 of Republic
Act No. 7166 in connection with the conduct of the May
10, 2010 national and local elections:

SECTION 1. General Guiding Principles. During the

election period: (a) no person shall bear, carry or
transport firearms or other deadly weapons in
public places, including all public buildings, streets,
parks, and private vehicles or public conveyances,
even if licensed to possess or carry the same; and
(b) no candidate for public office, including incumbent
public officers seeking election to any public office, shall
employ, avail himself of or engage the services of security
personnel or bodyguards, whether or not such
bodyguards are regular members or officers of the
Philippine National Police (PNP), the Armed Forces of the
Philippines (AFP) or other law enforcement agency of the
Government.

The transport of firearms of those who are engaged

in the manufacture, importation, exportation, purchase,
sale of firearms, explosives and their spare parts or those
involving the transportation of firearms, explosives and
their spare parts, may, with prior notice to the
Commission, be authorized by the Director General of the
PNP provided that the firearms, explosives and their
spare parts are immediately transported to the Firearms
and Explosives Division, CSG, PNP.

SEC. 2. Definition
Resolution:

of

Terms. As

used

in

this

(a)
Election Period refers to the election period
prescribed in Comelec Resolution No. 8646 dated 14 July
2009 which is from 10 January 2010 to 09 June 2010;

(b)
Firearm shall
refer
to
the
"firearm"
as defined in existing laws, rules and regulations. The
term
also includes
airgun, airsoft guns, and
their
replica/imitation in whatever form that can cause an
ordinary person to believe that they are real;

(c)
Deadly weapon includes bladed instrument,
handgrenades or other explosives, except pyrotechnics.
xxxx

SEC. 4. Who May Bear Firearms. Only the following

persons who are in the regular plantilla of the PNP or AFP or

other law enforcement agencies are authorized to bear, carry or

transport firearms or other deadly weapons during the election
period:

(a) Regular member or officer of the PNP, the AFP and

other law enforcement agencies of the Government,
provided that when in the possession of firearm, he is:
(1) in the regular plantilla of the said agencies and is
receiving regular compensation for the services
rendered in said agencies; and (2) in the agencyprescribed uniform showing clearly and legibly his
name, rank and serial number or, in case rank and
serial number are inapplicable, his agency-issued
identification card showing clearly his name and
position, which identification card shall remain visible at
all times; (3) duly licensed to possess firearm and to
carry the same outside of residence by means of a valid
mission order or letter order; and (4) in the actual
performance of official law enforcement duty, or in
going to or returning from his residence/barracks or
official station.
xxxx

(b) Member of privately owned or operated security,

investigative, protective or intelligence agencies duly
authorized by the PNP, provided that when in the
possession of firearm, he is: (1) in the agencyprescribed uniform with his agency-issued identification
card prominently displayed and visible at all times,
showing clearly his name and position; and (2) in the
actual performance of duty at his specified place/area of
duty.

xxxx

SEC. 8. Enforcement. Any person who, not wearing the

authorized uniform mentioned herein, bears, carries or
transports firearm or other deadly weapon, shall be presumed
unauthorized to carry firearms and subject to arrest.[5]

Petitioner contends that under R.A. No. 7166, the term

firearm connotes real firearm. Moreover, R.A. No. 7166 does not
mention
airsoft
guns
and
their
replicas/imitations.
Hence, its implementing rules and regulations contained in
Resolution No. 8714 should not include airsoft guns and their
replicas/imitations in the definition of the term firearm.

The Court is not persuaded.

Holy Spirit Homeowners Association, Inc. v. Defensor [6] held:

Where a rule or regulation has a provision not expressly stated

or contained in the statute being implemented, that provision does not
necessarily contradict the statute. A legislative rule is in the nature of
subordinate legislation, designed to implement a primary legislation by
providing the details thereof.All that is required is that the
regulation should be germane to the objects and purposes of
the law; that the regulation be not in contradiction to, but in
conformity with, the standards prescribed by the law.[7]

Evidently, the COMELEC had the authority to promulgate

Resolution No. 8714 pursuant to Section 35 of R.A. No. 7166. It
was granted the power to issue the implementing rules and
regulations of Sections 32 and 33 of R.A. No. 7166. Under this
broad power, the COMELEC was mandated to provide the details
of who may bear, carry or transport firearms or other deadly
weapons, as well as the definition of firearms, among others.
These details are left to the discretion of the COMELEC, which is a
constitutional body that possesses special knowledge and
expertise on election matters, with the objective of ensuring the
holding of free, orderly, honest, peaceful and credible elections.

In its Comment,[8] the COMELEC, represented by the Office

of the Solicitor General, states that the COMELECs intent in the
inclusion of airsoft guns in the term firearm and their resultant
coverage by the election gun ban is to avoid the possible use of
recreational guns in sowing fear, intimidation or terror during the
election period. An ordinary citizen may not be able to distinguish
between a real gun and an airsoft gun. It is fear subverting the
will of a voter, whether brought about by the use of a real gun or
a recreational gun, which is sought to be averted. Ultimately, the
objective is to ensure the holding of free, orderly, honest,
peaceful and credible elections this year.
Contrary to petitioners allegation, there is a regulation that
governs the possession and carriage of airsoft rifles/pistols,
namely, Philippine National Police (PNP) Circular No. 11 dated
December 4, 2007, entitled Revised Rules and Regulations

Governing the Manufacture, Importation, Exportation, Sale,

Possession, Carrying of Airsoft Rifles/Pistols and Operation of
Airsoft Game Sites and Airsoft Teams. The Circular defines an
airsoft gun as follows:

Airsoft Rifle/Pistol x x x includes battery operated, spring

and gas type powered rifles/pistols which discharge plastic or
rubber pellets only as bullets or ammunition. This differs from
replica as the latter does not fire plastic or rubber pellet.

PNP Circular No. 11 classifies the airsoft rifle/pistol as a

special type of air gun, which is restricted in its use only to
sporting activities, such as war game simulation. [9] Any person
who desires to possess an airsoft rifle/pistol needs a license from
the PNP, and he shall file his application in accordance with PNP
Standard Operating Procedure No. 13, which prescribes the
procedure to be followed in the licensing of firearms. [10] The
minimum age limit of the applicant is 18 years old. [11]The Circular
also requires a Permit to Transport an airsoft rifle/pistol from the
place of residence to any game or exhibition site.[12]

A license to possess an airsoft gun, just like ordinary

licenses in other regulated fields, does not confer an absolute
right, but only a personal privilege to be exercised under existing
restrictions, and such as may thereafter be reasonably imposed.
[13]

The inclusion of airsoft guns and airguns in the term firearm

in Resolution No. 8714 for purposes of the gun ban during the
election period is a reasonable restriction, the objective of which
is to ensure the holding of free, orderly, honest, peaceful and
credible elections.

However, the Court excludes the replicas and imitations

of airsoft guns and airguns from the term firearm under
Resolution No. 8714, because they are not subject to any
regulation, unlike airsoftguns.

Petitioner further contends that Resolution No. 8714 is not in

accordance with the State policies in these constitutional
provisions:

Art. II, Sec. 12. The State recognizes the sanctity of family
life and shall protect and strengthen the family as a basic
autonomous social institution. x x x

Art. XV, Sec. 1. The State recognizes the Filipino family as

the foundation of the nation.Accordingly, it shall strengthen its
solidarity and actively promote its total development.

Art. II, Sec. 17. The State shall give priority to x x x sports
to foster patriotism and nationalism, accelerate social progress,
and promote total human liberation and development.

Petitioner asserts that playing airsoft provides bonding

moments among family members.Families are entitled to
protection by the society and the State under the Universal
Declaration of Human Rights. They are free to choose and enjoy
their recreational activities. These liberties, petitioner contends,
cannot be abridged by the COMELEC.

In its Comment, the COMELEC, through the Solicitor

General, states that it adheres to the aforementioned state
policies, but even constitutional freedoms are not absolute, and
they may be abridged to some extent to serve appropriate and
important interests.
As a long-time player of the airsoft sport, it is presumed that
petitioner has a license to possess an airsoft gun. As a lawyer,
petitioner is aware that
a licensee of an airsoft gun is subject to the restrictions imposed
upon him by PNP Circular No. 11 and other valid restrictions, such
as Resolution No. 8714. These restrictions exist in spite of the
aforementioned State policies, which do not directly uphold a
licensees absolute right to possess or carry an airsoft gun under
any circumstance.

Petitioners allegation of grave abuse of discretion by

respondent COMELEC implies such capricious and whimsical
exercise of judgment as is equivalent to lack of jurisdiction or, in
other words, the exercise of power in an arbitrary manner by
reason of passion, prejudice or personal hostility, and it must be
so patent or gross as to amount to an evasion of a positive duty
or to a virtual refusal to perform the duty enjoined or to act at all
in contemplation of law.[14]

The Court holds that the COMELEC did not gravely abuse its
discretion in including airsoft guns and airguns in the term
firearm in Resolution No. 8714 for purposes of the gun ban during
the election period, with the apparent objective of ensuring free,
honest, peaceful and credible elections this year. However, the
replicas and imitations of airsoft guns and airguns are excluded
from the term firearm in Resolution No. 8714.
WHEREFORE, the petition is PARTLY GRANTED insofar as
the exclusion of replicas and imitations of airsoft guns from the
term firearm is concerned. Replicas and imitations of airsoft guns
and airguns are hereby declared excluded from the term firearm
in Resolution No. 8714. The petition is DISMISSED in regard to
the exclusion of airsoft guns from the term firearm in Resolution
No. 8714. Airsoft guns and airguns are covered by the gun ban
during the election period.

No costs.

SO ORDERED.

FIRST DIVISION
[G.R. No. 119761. August 29, 1996]

COMMISSIONER
OF
INTERNAL
REVENUE, petitioner, vs. HON. COURT OF APPEALS,
HON. COURT OF TAX APPEALS and FORTUNE TOBACCO
CORPORATION,respondents.
DECISION

VITUG, J.:

The Commissioner of Internal Revenue ("CIR") disputes the

decision, dated 31 March 1995, of respondent Court of
Appeals affirming the 10th August 1994 decision and the 11th
October 1994 resolution of the Court of Tax Appeals ("CTA") in
C.T.A. Case No. 5015, entitled "Fortune Tobacco Corporation vs.
Liwayway Vinzons-Chato in her capacity as Commissioner of
Internal Revenue."
[1]

[2]

The facts, by and large, are not in dispute.

Fortune Tobacco Corporation ("Fortune Tobacco") is engaged in
the manufacture of different brands of cigarettes.
On various dates, the Philippine Patent Office issued to the
corporation separate certificates of trademark registration over
"Champion," "Hope," and "More" cigarettes. In a letter, dated 06
January 1987, of then Commissioner of Internal Revenue
Bienvenido A. Tan, Jr., to Deputy Minister Ramon Diaz of the
Presidential Commission on Good Government, "the initial position
of the Commission was to classify 'Champion,' 'Hope,' and 'More' as
foreign brands since they were listed in the World Tobacco Directory
as belonging to foreign companies. However, Fortune Tobacco
changed the names of 'Hope' to Hope Luxury'and 'More' to
'Premium More,' thereby removing the said brands from the foreign
brand category. Proof was also submitted to the Bureau (of Internal
Revenue ['BIR']) that 'Champion' was an original Fortune Tobacco
Corporation register and therefore a local brand." Ad Valorem taxes
were imposed on these brands, at the following rates:
[3]

[4]

"BRAND AD VALOREM TAX RATE

E.O. 22

06-23-86
07-01-86 and E.O. 273
07-25-87
01-01-88 RA 6956
06-18-90
07-05-90

Hope Luxury M. 100's

Sec. 142, (c), (2) 40% 45%
Hope Luxury M. King
Sec. 142, (c), (2) 40% 45%
More Premium M. 100's
Sec. 142, (c), (2) 40% 45%
More Premium International
Sec. 142, (c), (2) 40% 45%
Champion Int'l. M. 100's
Sec. 142, (c), (2) 40% 45%
Champion M. 100's
Sec. 142, (c), (2) 40% 45%
Champion M. King

Sec. 142, (c), last par. 15% 20%

Champion Lights
Sec. 142, (c), last par. 15% 20%"

[5]

A bill, which later became Republic Act ("RA") No. 7654, was
enacted, on 10 June 1993, by the legislature and signed into law, on
14 June 1993, by the President of the Philippines. The new law
became effective on 03 July 1993. It amended Section 142(c)(1) of
the National Internal Revenue Code ("NIRC") to read; as follows:
[6]

"SEC. 142. Cigars and Cigarettes. "x x x x x x x x x.

"(c) Cigarettes packed by machine. - There shall be levied, assessed
and collected on cigarettes packed by machine a tax at the rates
prescribed below based on the constructive manufacturer's
wholesale price or the actual manufacturer's wholesale price,
whichever is higher:
"(1) On locally manufactured cigarettes which are currently
classified and taxed at fifty-five percent (55%) or the exportation of
which is not authorized by contract or otherwise, fifty-five (55%)
provided that the minimum tax shall not be less than Five Pesos
(P5.00) per pack.
"(2). On other locally manufactured cigarettes, forty-five percent
(45%) provided that the minimum tax shall not be less than Three
Pesos (P3.00) per pack.
"x x x x x x x x x.
"When the registered manufacturer's wholesale price or the actual
manufacturer's wholesale price whichever is higher of existing
brands of cigarettes, including the amounts intended to cover the

taxes, of cigarettes packed in twenties does not exceed Four Pesos

and eighty centavos (P4.80) per pack, the rate shall be twenty
percent (20%)." (Italics supplied.)
[7]

About a month after the enactment and two (2) days before the
effectivity of RA 7654, Revenue Memorandum Circular No. 37-93
("RMC 37-93"), was issued by the BIR the full text of which
expressed:
"REPUBLIKA NG PILIPINAS
KAGAWARAN NG PANANALAPI
KAWANIHAN NG RENTAS INTERNAS
July 1, 1993
REVENUE MEMORANDUM CIRCULAR NO. 37-93
SUBJECT : Reclassification of Cigarettes Subject to Excise Tax
TO : All Internal Revenue Officers and Others Concerned.
"In view of the issues raised on whether 'HOPE,' 'MORE' and
'CHAMPION' cigarettes which are locally manufactured are
appropriately considered as locally manufactured cigarettes bearing
a foreign brand, this Office is compelled to review the previous
rulings on the matter.
"Section 142(c)(1) National Internal Revenue Code, as amended by
R.A. No. 6956, provides:
"'On locally manufactured cigarettes bearing a foreign brand, fiftyfive percent (55%) Provided, That this rate shall apply regardless of
whether or not the right to use or title to the foreign brand was sold
or transferred by its owner to the local manufacturer. Whenever it
has to be determined whether or not a cigarette bears a foreign

brand, the listing of brands manufactured in foreign countries

appearing in the current World Tobacco Directory shall govern."
"Under the foregoing, the test for imposition of the 55% ad
valorem tax on cigarettes is that the locally manufactured cigarettes
bear a foreign brand regardless of whether or not the right to use or
title to the foreign brand was sold or transferred by its owner to the
local manufacturer. The brand must be originally owned by a foreign
manufacturer or producer. If ownership of the cigarette brand is,
however, not definitely determinable, 'x x x the listing of brands
manufactured in foreign countries appearing in the current World
Tobacco Directory shall govern. x x x'
"'HOPE' is listed in the World Tobacco Directory as being
manufactured by (a) Japan Tobacco, Japan and (b) Fortune Tobacco,
Philippines. 'MORE' is listed in the said directory as being
manufactured by: (a) Fills de Julia Reig, Andorra; (b) Rothmans,
Australia; (c) RJR-Macdonald, Canada; (d) Rettig-Strenberg,
Finland; (e) Karellas, Greece; (f) R.J. Reynolds, Malaysia; (g)
Rothmans, New Zealand; (h) Fortune Tobacco, Philippines; (i) R.J.
Reynolds, Puerto Rico; (j) R.J. Reynolds, Spain; (k) Tabacalera,
Spain; (l) R.J. Reynolds, Switzerland; and (m) R.J. Reynolds,
USA. 'Champion' is registered in the said directory as being
manufactured by (a) Commonwealth Bangladesh; (b) Sudan, Brazil;
(c) Japan Tobacco, Japan; (d) Fortune Tobacco, Philippines; (e)
Haggar, Sudan; and (f) Tabac Reunies, Switzerland.
"Since there is no showing who among the above-listed
manufacturers of the cigarettes bearing the said brands are the real
owner/s thereof, then it follows that the same shall be considered
foreign brand for purposes of determining the ad valorem tax
pursuant to Section 142 of the National Internal Revenue Code. As
held in BIR Ruling No. 410-88, dated August 24, 1988, 'in cases
where it cannot be established or there is dearth of evidence as to

whether a brand is foreign or not, resort to the World Tobacco

Directory should be made.'
"In view of the foregoing, the aforesaid brands of
cigarettes, viz: 'HOPE,' 'MORE' and 'CHAMPION' being manufactured
by Fortune Tobacco Corporation are hereby considered locally
manufactured cigarettes bearing a foreign brand subject to the
55% ad valorem tax on cigarettes.
"Any ruling inconsistent herewith is revoked or modified accordingly.
(SGD) LIWAYWAY
VINZONS-CHATO
Commissioner"
On 02 July 1993, at about 17:50 hours, BIR Deputy
Commissioner Victor A. Deoferio, Jr., sent viatelefax a copy of RMC
37-93 to Fortune Tobacco but it was addressed to no one in
particular. On 15 July 1993, Fortune Tobacco received, by ordinary
mail, a certified xerox copy of RMC 37-93.
In a letter, dated 19 July 1993, addressed to the appellate
division of the BIR, Fortune Tobacco, requested for a review,
reconsideration and recall of RMC 37-93. The request was denied on
29 July 1993.The following day, or on 30 July 1993, the CIR
assessed Fortune Tobacco for ad valorem tax deficiency amounting
to P9,598,334.00.
On 03 August 1993, Fortune Tobacco filed a petition for review
with the CTA.
[8]

On 10 August 1994, the CTA upheld the position of Fortune

Tobacco and adjudged:
"WHEREFORE, Revenue Memorandum Circular No. 37-93
reclassifying the brands of cigarettes, viz: `HOPE,' `MORE' and

`CHAMPION' being manufactured by Fortune Tobacco Corporation

as locally manufactured cigarettes bearing a foreign brand subject
to the 55% ad valorem tax on cigarettes is found to be defective,
invalid and unenforceable, such that when R.A. No. 7654 took effect
on July 3, 1993, the brands in question were not CURRENTLY
CLASSIFIED AND TAXED at 55% pursuant to Section 1142(c)(1) of
the Tax Code, as amended by R.A. No. 7654 and were therefore still
classified as other locally manufactured cigarettes and taxed at 45%
or 20% as the case may be.
"Accordingly, the deficiency ad valorem tax assessment issued on
petitioner Fortune Tobacco Corporation in the amount of
P9,598,334.00, exclusive of surcharge and interest, is hereby
canceled for lack of legal basis.
"Respondent Commissioner of Internal Revenue is hereby enjoined
from collecting the deficiency tax assessment made and issued on
petitioner in relation to the implementation of RMC No. 37-93.
"SO ORDERED."

[9]

In its resolution, dated 11 October 1994, the CTA dismissed for lack
of merit the motion for reconsideration.
The CIR forthwith filed a petition for review with the Court of
Appeals, questioning the CTA's 10th August 1994 decision and 11th
October 1994 resolution. On 31 March 1993, the appellate court's
Special Thirteenth Division affirmed in all respects the assailed
decision and resolution.
In the instant petition, the Solicitor General argues: That "I. RMC 37-93 IS A RULING OR OPINION OF THE COMMISSIONER
OF INTERNAL REVENUE INTERPRETING THE PROVISIONS OF THE
TAX CODE.

"II. BEING AN INTERPRETATIVE RULING OR OPINION, THE

PUBLICATION OF RMC 37-93, FILING OF COPIES THEREOF WITH
THE UP LAW CENTER AND PRIOR HEARING ARE NOT NECESSARY
TO ITS VALIDITY, EFFECTIVITY AND ENFORCEABILITY.
"III. PRIVATE RESPONDENT IS DEEMED TO HAVE BEEN NOTIFIED
OR RMC 37-93 ON JULY 2, 1993.
IV. RMC 37-93 IS NOT DISCRIMINATORY SINCE IT APPLIES TO ALL
LOCALLY MANUFACTURED CIGARETTES SIMILARLY SITUATED AS
'HOPE,' 'MORE' AND 'CHAMPION' CIGARETTES.
"V. PETITIONER WAS NOT LEGALLY PROSCRIBED FROM
RECLASSIFYING HOPE, MORE AND CHAMPION CIGARETTES BEFORE
THE EFFECTIVITY OF R.A. NO. 7654.
VI. SINCE RMC 37-93 IS AN INTERPRETATIVE RULE, THE INQUIRY
IS NOT INTO ITS VALIDITY, EFFECTIVITY OR ENFORCEABILITY BUT
INTO ITS CORRECTNESS OR PROPRIETY; RMC 37-93 IS
CORRECT."
[10]

In fine, petitioner opines that RMC 37-93 is merely an

interpretative ruling of the BIR which can thus become effective
without any prior need for notice and hearing, nor publication, and
that its issuance is not discriminatory since it would apply under
similar circumstances to all locally manufactured cigarettes.
The Court must sustain both the appellate court and the tax
court.
Petitioner stresses on the wide and ample authority of the BIR in
the issuance of rulings for the effective implementation of the
provisions of the National Internal Revenue Code. Let it be made
clear that such authority of the Commissioner is not here
doubted. Like any other government agency, however, the CIR may

not disregard legal requirements or applicable principles in the

exercise of its quasi-legislative powers.
Let us first distinguish between two kinds of administrative
issuances - a legislative rule and aninterpretative rule.
In Misamis Oriental Association of Coco Traders, Inc., vs.
Department of Finance Secretary, the Court expressed:
[11]

"x x x a legislative rule is in the nature of subordinate legislation,

designed to implement a primary legislation by providing the details
thereof. In the same way that laws must have the benefit of public
hearing, it is generally required that before a legislative rule is
adopted there must be hearing. In this connection, the
Administrative Code of 1987 provides:
"Public Participation. - If not otherwise required by law, an agency
shall, as far as practicable, publish or circulate notices of proposed
rules and afford interested parties the opportunity to submit their
views prior to the adoption of any rule.
"(2) In the fixing of rates, no rule or final order shall be valid unless
the proposed rates shall have been published in a newspaper of
general circulation at least two (2) weeks before the first hearing
thereon.
"(3) In case of opposition, the rules on contested cases shall be
observed.
"In addition such rule must be published. On the other
hand, interpretative rules are designed to provide guidelines to the
law which the administrative agency is in charge of enforcing."
[12]

It should be understandable that when an administrative rule is

merely interpretative in nature, its applicability needs nothing
further than its bare issuance for it gives no real consequence more

than what the law itself has already prescribed. When, upon the
other hand, the administrative rule goes beyond merely providing
for the means that can facilitate or render least cumbersome the
implementation of the law but substantially adds to or increases the
burden of those governed, it behooves the agency to accord at least
to those directly affected a chance to be heard, and thereafter to be
duly informed, before that new issuance is given the force and
effect of law.
A reading of RMC 37-93, particularly considering the
circumstances under which it has been issued, convinces us that the
circular cannot be viewed simply as a corrective measure (revoking
in the process the previous holdings of past Commissioners) or
merely as construing Section 142(c)(1) of the NIRC, as amended,
but has, in fact and most importantly, been made in order to place
"Hope Luxury," "Premium More" and "Champion" within the
classification of locally manufactured cigarettes bearing foreign
brands and to thereby have them covered by RA 7654. Specifically,
the new law would have its amendatory provisions applied to locally
manufactured cigarettes which at the time of its effectivity were not
so classified as bearing foreign brands. Prior to the issuance of the
questioned circular, "Hope Luxury," "Premium More," and
"Champion" cigarettes were in the category of locally manufactured
cigarettes not bearing
foreign
brand
subject
to
45% ad
valorem tax. Hence, without RMC 37-93, the enactment of RA 7654,
would have had no new tax rate consequence on private
respondent's products. Evidently, in order to place "Hope Luxury,"
"Premium More," and "Champion" cigarettes within the scope of the
amendatory law and subject them to an increased tax rate, the now
disputed RMC 37-93 had to be issued. In so doing, the BIR not
simply interpreted the law; verily, it legislated under its quasilegislative authority. The due observance of the requirements of
notice, of hearing, and of publication should not have been then
ignored.

Indeed, the BIR itself, in its RMC 10-86, has observed and
provided:
"RMC NO. 10-86
Effectivity of Internal Revenue Rules and Regulations
"It has been observed that one of the problem areas bearing on
compliance with Internal Revenue Tax rules and regulations is lack
or insufficiency of due notice to the tax paying public. Unless there
is due notice, due compliance therewith may not be reasonably
expected. And most importantly, their strict enforcement could
possibly suffer from legal infirmity in the light of the constitutional
provision on `due process of law' and the essence of the Civil Code
provision concerning effectivity of laws, whereby due notice is a
basic requirement (Sec. 1, Art. IV, Constitution; Art. 2, New Civil
Code).
"In order that there shall be a just enforcement of rules and
regulations, in conformity with the basic element of due process,
the following procedures are hereby prescribed for the drafting,
issuance and implementation of the said Revenue Tax Issuances:
"(1). This Circular shall apply only to (a) Revenue Regulations; (b)
Revenue Audit Memorandum Orders; and (c)Revenue
Memorandum Circulars and Revenue Memorandum Orders
bearing on internal revenue tax rules and regulations.
"(2). Except when the law otherwise expressly provides, the
aforesaid internal revenue tax issuances shall not begin to be
operative until after due notice thereof may be fairly presumed.
"Due notice of the said issuances may be fairly presumed only after
the following procedures have been taken:
"xxx xxx xxx

"(5). Strict compliance with the foregoing procedures is enjoined."

[13]

Nothing on record could tell us that it was either impossible or

impracticable for the BIR to observe and comply with the above
requirements before giving effect to its questioned circular.
Not insignificantly, RMC 37-93 might have likewise infringed on
uniformity of taxation.
Article VI, Section 28, paragraph 1, of the 1987 Constitution
mandates taxation to be uniform and equitable. Uniformity requires
that all subjects or objects of taxation, similarly situated, are to be
treated alike or put on equal footing both in privileges and liabilities.
Thus, all taxable articles or kinds of property of the same class
must be taxed at the same rate and the tax must operate with the
same force and effect in every place where the subject may be
found.
[14]

[15]

Apparently, RMC 37-93 would only apply to "Hope Luxury,"

Premium More" and "Champion" cigarettes and, unless petitioner
would be willing to concede to the submission of private respondent
that the circular should, as in fact my esteemed colleague Mr.
Justice Bellosillo so expresses in his separate opinion, be
considered adjudicatory in nature and thus violative of due process
following the Ang Tibay doctrine, the measure suffers from lack of
uniformity of taxation. In its decision, the CTA has keenly noted that
other cigarettes bearing foreign brands have not been similarly
included within the scope of the circular, such as [16]

"1. Locally manufactured by ALHAMBRA INDUSTRIES, INC.

(a) `PALM TREE' is listed as manufactured by office of Monopoly,
Korea (Exhibit `R')
"2. Locally manufactured by LA SUERTE CIGAR and CIGARETTE
COMPANY

(a) `GOLDEN KEY' is listed being manufactured by United Tobacco,

Pakistan (Exhibit `S')
(b) `CANNON' is listed as being manufactured by Alpha Tobacco,
Bangladesh (Exhibit `T')
"3. Locally manufactured by LA PERLA INDUSTRIES, INC.
(a) `WHITE HORSE' is listed as being manufactured by Rothman's,
Malaysia (Exhibit `U')
(b) `RIGHT' is listed as being manufactured by SVENSKA, Tobaks,
Sweden (Exhibit `V-1')
"4. Locally manufactured by MIGHTY CORPORATION
(a) 'WHITE HORSE' is listed as being manufactured by Rothman's,
Malaysia (Exhibit 'U-1')
"5. Locally manufactured by STERLING TOBACCO CORPORATION
(a) UNION' is listed as being manufactured by Sumatra Tobacco,
Indonesia and Brown and Williamson, USA (Exhibit 'U-3')
(b) WINNER' is listed as being manufactured by Alpha Tobacco,
Bangladesh; Nanyang, Hongkong; Joo Lan, Malaysia; Pakistan
Tobacco Co., Pakistan; Premier Tobacco, Pakistan and Haggar,
Sudan (Exhibit 'U-4')."
[17]

The court quoted at length from the transcript of the hearing

conducted on 10 August 1993 by the Committee on Ways and
Means of the House of Representatives; viz:
"THE CHAIRMAN. So you have specific information on Fortune
Tobacco alone. You don't have specific information on other tobacco
manufacturers. Now, there are other brands which are similarly
situated. They are locally manufactured bearing foreign brands. And

may I enumerate to you all these brands, which are also listed in
the World Tobacco Directory x x x. Why were these brands not
reclassified at 55 if your want to give a level playing field to foreign
manufacturers?
"MS. CHATO. Mr. Chairman, in fact, we have already prepared a
Revenue Memorandum Circular that was supposed to come after
RMC No. 37-93 which have really named specifically the list of
locally manufactured cigarettes bearing aforeign brand for excise
tax purposes and includes all these brands that you mentioned at
55 percent except that at that time, when we had to come up with
this, we were forced to study the brands of Hope, More and
Champion because we were given documents that would indicate
the that these brands were actually being claimed or patented in
other countries because we went by Revenue Memorandum Circular
1488 and we wanted to give some rationality to how it came about
but we couldn't find the rationale there. And we really found based
on our own interpretation that the only test that is given by that
existing law would be registration in the World Tobacco Directory. So
we came out with this proposed revenue memorandum circular
which we forwarded to the Secretary of Finance except that at that
point in time, we went by the Republic Act 7654 in Section 1 which
amended Section 142, C-1, it said, that on locally manufactured
cigarettes which are currently classified and taxed at 55 percent. So
we were saying that when this law took effect in July 3 and if we
are going to come up with this revenue circular thereafter, then I
think our action would really be subject to question but we feel
that . . . Memorandum Circular Number 37-93 would really cover
even similarly situated brands. And in fact, it was really because of
the study, the short time that we were given to study the matter
that we could not include all the rest of the other brands that would
have been really classified as foreign brand if we went by the law
itself. I am sure that by the reading of the law, you would without
that ruling by Commissioner Tan they would really have been

included in the definition or in the classification of foregoing

brands. These brands that you referred to or just read to us and in
fact just for your information, we really came out with a proposed
revenue memorandum circular for those brands. (Italics supplied)
"Exhibit 'FF-2-C', pp. V-5 TO V-6, VI-1 to VI-3).
"x x x x x x x x x.
"MS. CHATO. x x x But I do agree with you now that it cannot and in
fact that is why I felt that we . . . I wanted to come up with a more
extensive coverage and precisely why I asked that revenue
memorandum circular that would cover all those similarly situated
would be prepared but because of the lack of time and I came out
with a study of RA 7654, it would not have been possible to really
come up with the reclassification or the proper classification of all
brands that are listed there. x x x' (italics supplied) (Exhibit 'FF-2d',
page IX-1)
"x x x x x x x x x.
"HON. DIAZ. But did you not consider that there are similarly
situated?
"MS. CHATO. That is precisely why, Sir, after we have come up with
this Revenue Memorandum Circular No. 37-93, the other brands
came about the would have also clarified RMC 37-93 by I was
saying really because of the fact that I was just recently appointed
and the lack of time, the period that was allotted to us to come up
with the right actions on the matter, we were really caught by the
July 3 deadline. But in fact, We have already prepared a revenue
memorandum circular clarifying with the other . . . does not yet,
would have been a list of locally manufactured cigarettes bearing a
foreign brand for excise tax purposes which would include all the
other brands that were mentioned by the Honorable
Chairman. (Italics supplied) (Exhibit 'FF-2-d,' par. IX-4)."
18

All taken, the Court is convinced that the hastily promulgated

RMC 37-93 has fallen short of a valid and effective administrative
issuance.
WHEREFORE, the decision of the Court of Appeals, sustaining
that of the Court of Tax Appeals, is AFFIRMED. No costs.
SO ORDERED.

EN BANC
G.R. No. 205357, September 02, 2014
GMA NETWORK, INC., Petitioner, v. COMMISSION ON ELECTIONS, RESPONDENT.
SENATOR ALAN PETER COMPAERO S. CAYETANO, Petitioner-Intervenor.
G.R. NO. 205374

ABC DEVELOPMENT CORPORATION, Petitioner, v. COMMISSION ON

ELECTIONS, Respondent.
G.R. NO. 205592
MANILA BROADCASTING COMPANY, INC. AND NEWSOUNDS BROADCASTING
NETWORK, INC.,Petitioner, v. COMMISSION ON ELECTIONS, Respondent.
G.R. NO. 205852
KAPISANAN NG MGA BRODKASTER NG PILIPINAS (KBP) AND ABS-CBN
CORPORATION,Petitioners, v. COMMISSION ON ELECTIONS, Respondent.
G.R. NO. 206360
RADIO MINDANAO NETWORK, INC., Petitioner, v. COMMISSION ON
ELECTIONS, Respondent.
DECISION
PERALTA, J.:
The clash of rights demands a delicate balancing of interests approach which is a
fundamental postulate of constitutional law.1
Once again the Court is asked to draw a carefully drawn balance in the incessant
conflicts between rights and regulations, liberties and limitations, and competing
demands of the different segments of society. Here, we are confronted with the need to
strike a workable and viable equilibrium between a constitutional mandate to maintain
free, orderly, honest, peaceful and credible elections, together with the aim of ensuring
equal opportunity, time and space, and the right to reply, including reasonable, equal
rates therefor, for public information campaigns and forums among candidates, 2on one
hand, and the imperatives of a republican and democratic state, 3 together with its
guaranteed rights of suffrage,4 freedom of speech and of the press,5 and the peoples
right to information,6 on the other.
In a nutshell, the present petitions may be seen as in search of the answer to the
question how does the Charter of a republican and democratic State achieve a
viable and acceptable balance between liberty, without which, government
becomes an unbearable tyrant, and authority, without which, society becomes
an intolerable and dangerous arrangement?
Assailed in these petitions are certain regulations promulgated by the Commission on
Elections(COMELEC) relative to the conduct of the 2013 national and local elections
dealing with political advertisements. Specifically, the petitions question the
constitutionality of the limitations placed on aggregate airtime allowed to candidates
and political parties, as well as the requirements incident thereto, such as the need to
report the same, and the sanctions imposed for violations.

The five (5) petitions before the Court put in issue the alleged unconstitutionality of
Section 9 (a) of COMELEC Resolution No. 9615 (Resolution) limiting the broadcast and
radio advertisements of candidates and political parties for national election positions to
an aggregate total of one hundred twenty (120) minutes and one hundred eighty (180)
minutes, respectively. They contend that such restrictive regulation on allowable
broadcast time violates freedom of the press, impairs the peoples right to suffrage as
well as their right to information relative to the exercise of their right to choose who to
elect during the forthcoming elections.
The heart of the controversy revolves upon the proper interpretation of the limitation on
the number of minutes that candidates may use for television and radio
advertisements, as provided in Section 6 of Republic Act No. 9006 (R.A. No. 9006),
otherwise known as the Fair Election Act. Pertinent portions of said provision state,
thus:
ChanRoblesVirtualawlibrary

Sec. 6. Equal Access to Media Time and Space. - All registered parties and bona fide
candidates shall have equal access to media time and space. The following guidelines
may be amplified on by the COMELEC:
x x x x
6.2 (a) Each bona fide candidate or registered political party for a nationally elective
office shall be entitled to not more than one hundred twenty (120) minutes of television
advertisement and one hundred eighty (180) minutes of radio advertisement whether
by purchase or donation.
b. Each bona fide candidate or registered political party for a locally elective office shall
be entitled to not more than sixty (60) minutes of television advertisement and ninety
(90) minutes of radio advertisement whether by purchase or donation.
For this purpose, the COMELEC shall require any broadcast station or entity to submit to
the COMELEC a copy of its broadcast logs and certificates of performance for the review
and verification of the frequency, date, time and duration of advertisements broadcast
for any candidate or political party.
During the previous elections of May 14, 2007 and May 10, 2010, COMELEC issued
Resolutions implementing and interpreting Section 6 of R.A. No. 9006, regarding
airtime limitations, to mean that a candidate is entitled to the aforestated number of
minutes per station.7 For the May 2013 elections, however, respondent COMELEC
promulgated Resolution No. 9615 dated January 15, 2013, changing the interpretation
of said candidates' and political parties' airtime limitation for political campaigns or
advertisements from a per station basis, to a total aggregate basis.
Petitioners ABS-CBN Corporation (ABS-CBN), ABC Development Corporation (ABC),
GMA Network, Incorporated (GMA), Manila Broadcasting Company, Inc. (MBC),
Newsounds Broadcasting Network, Inc. (NBN), and Radio Mindanao Network, Inc.
(RMN) are owners/operators of radio and television networks in the Philippines, while
petitioner Kapisanan ng mga Brodkaster ng Pilipinas (KBP) is the national organization
of broadcasting companies in the Philippines representing operators of radio and
television stations and said stations themselves. They sent their respective letters to
the COMELEC questioning the provisions of the aforementioned Resolution, thus, the

COMELEC held public hearings. Thereafter, on February 1, 2013, respondent issued

Resolution No. 9631 amending provisions of Resolution No. 9615. Nevertheless,
petitioners still found the provisions objectionable and oppressive, hence, the present
petitions.
All of the petitioners assail the following provisions of the Resolution:

ChanRoblesVirtualawlibrary

a) Section 7 (d),8 which provides for a penalty of suspension or revocation of an

offender's franchise or permit, imposes criminal liability against broadcasting entities
and their officers in the event they sell airtime in excess of the size, duration, or
frequency authorized in the new rules;
b) Section 9 (a),9 which provides for an aggregate total airtime instead of the
previous per station airtime for political campaigns or advertisements, and also
required prior COMELEC approval for candidates' television and radio guestings and
appearances; and
c) Section 14,10 which provides for a candidate's right to reply.
In addition, petitioner ABC also questions Section 1 (4) 11 thereof, which defines the
term political advertisement or election propaganda, while petitioner GMA further
assails Section 35,12 which states that any violation of said Rules shall constitute an
election offense.
On March 15, 2013, Senator Alan Peter S. Cayetano (Petitioner-Intervenor) filed a
Motion for Leave to Intervene and to File and Admit the Petition-in-Intervention, which
was granted by the Court per its Resolution dated March 19, 2013. PetitionerIntervenor also assails Section 9 (a) of the Resolution changing the interpretation of
candidates' and political parties' airtime limitation for political campaigns or
advertisements from a per station basis, to a total aggregate basis.
Petitioners allege that Resolutions No. 9615 and 9631, amending the earlier Resolution,
are unconstitutional and issued without jurisdiction or with grave abuse of discretion
amounting to lack or excess of jurisdiction, for the reasons set forth hereunder.
Petitioners posit that Section 9 (a) of the assailed Resolution provides for a very
restrictive aggregate airtime limit and a vague meaning for a proper computation of
aggregate total airtime, and violates the equal protection guarantee, thereby
defeating the intent and purpose of R.A. No. 9006.
Petitioners contend that Section 9 (a), which imposes a notice requirement, is vague
and infringes on the constitutionally protected freedom of speech, of the press and of
expression, and on the right of people to be informed on matters of public concern
Also, Section 9 (a) is a cruel and oppressive regulation as it imposes an unreasonable
and almost impossible burden on broadcast mass media of monitoring a candidate's or
political party's aggregate airtime, otherwise, it may incur administrative and criminal
liability.
Further, petitioners claim that Section 7 (d) is null and void for unlawfully criminalizing

acts not prohibited and penalized as criminal offenses by R.A. No. 9006.
Section 14 of Resolution No. 9615, providing for a candidate's or political party's right
to reply, is likewise assailed to be unconstitutional for being an improper exercise of
the COMELEC's regulatory powers; for constituting prior restraint and infringing
petitioners' freedom of expression, speech and the press; and for being violative of the
equal protection guarantee.
In addition to the foregoing, petitioner GMA further argues that the Resolution was
promulgated without public consultations, in violation of petitioners' right to due
process. Petitioner ABC also avers that the Resolution's definition of the terms political
advertisement and election propaganda suffers from overbreadth, thereby producing
a chilling effect, constituting prior restraint.
On the other hand, respondent posits in its Comment and Opposition 13 dated March 8,
2013, that the petition should be denied based on the following reasons:
ChanRoblesVirtualawlibrary

Respondent contends that the remedies of certiorari and prohibition are not available to
petitioners, because the writ of certiorari is only available against the COMELEC's
adjudicatory or quasi-judicial powers, while the writ of prohibition only lies against the
exercise of judicial, quasi-judicial or ministerial functions. Said writs do not lie against
the COMELECs administrative or rule-making powers.
Respondent likewise alleges that petitioners do not have locus standi, as the
constitutional rights and freedoms they enumerate are not personal to them, rather,
they belong to candidates, political parties and the Filipino electorate in general, as the
limitations are imposed on candidates, not on media outlets. It argues that petitioners'
alleged risk of exposure to criminal liability is insufficient to give them legal standing as
said fear of injury is highly speculative and contingent on a future act.
Respondent then parries petitioners' attack on the alleged infirmities of the Resolution's
provisions.
Respondent maintains that the per candidate rule or total aggregate airtime limit is in
accordance with R.A. No. 9006 as this would truly give life to the constitutional
objective to equalize access to media during elections. It sees this as a more effective
way of levelling the playing field between candidates/political parties with enormous
resources and those without much. Moreover, the Comelecs issuance of the assailed
Resolution is pursuant to Section 4, Article IX (C) of the Constitution which vests on the
Comelec the power to supervise and regulate, during election periods, transportation
and other public utilities, as well as mass media, to wit:
ChanRoblesVirtualawlibrary

Sec. 4. The Commission may, during the election period, supervise or regulate the
enjoyment or utilization of all franchises or permits for the operation of transportation
and other public utilities, media of communication or information, all grants, special
privileges, or concessions granted by the Government or any subdivision, agency, or
instrumentality thereof, including any government-owned or controlled corporation or
its subsidiary. Such supervision or regulation shall aim to ensure equal opportunity,
and equal rates therefor, for public information campaigns and forums among

candidates in connection with the objective of holding free, orderly, honest, peaceful,
and credible elections.
This being the case, then the Resolutions cannot be said to have been issued with grave
abuse of discretion amounting to lack of jurisdiction.
Next, respondent claims that the provisions are not vague because the assailed
Resolutions have given clear and adequate mechanisms to protect broadcast stations
from potential liability arising from a candidate's or party's violation of airtime limits by
putting in the proviso that the station may require buyer to warrant under oath that
such purchase [of airtime] is not in excess of size, duration or frequency authorized by
law or these rules. Furthermore, words should be understood in the sense that they
have in common usage, and should be given their ordinary meaning. Thus, in the
provision for the right to reply, charges against candidates or parties must be
understood in the ordinary sense, referring to accusations or criticisms.
Respondent also sees no prior restraint in the provisions requiring notice to the Comelec
for appearances or guestings of candidates in bona fide news broadcasts. It points out
that the fact that notice may be given 24 hours after first broadcast only proves that
the mechanism is for monitoring purposes only, not for censorship. Further, respondent
argues, that for there to be prior restraint, official governmental restrictions on the
press or other forms of expression must be done in advance of actual publication or
dissemination. Moreover, petitioners are only required to inform the Comelec of
candidates'/parties' guestings, but there is no regulation as to the content of the news
or the expressions in news interviews or news documentaries. Respondent then
emphasized that the Supreme Court has held that freedom of speech and the press
may be limited in light of the duty of the Comelec to ensure equal access to
opportunities for public service.
With regard to the right to reply provision, respondent also does not consider it as
restrictive of the airing of bona fide news broadcasts. More importantly, it stressed, the
right to reply is enshrined in the Constitution, and the assailed Resolutions provide that
said right can only be had after going through administrative due process. The
provision was also merely lifted from Section 10 of R.A. No. 9006, hence, petitioner
ABC is actually attacking the constitutionality of R.A. No. 9006, which cannot be done
through a collateral attack.
Next, respondent counters that there is no merit to ABC's claim that the Resolutions'
definition of political advertisement or election propaganda suffers from
overbreadth, as the extent or scope of what falls under said terms is clearly stated in
Section 1 (4) of Resolution No. 9615.
It is also respondent's view that the nationwide aggregate total airtime does not violate
the equal protection clause, because it does not make any substantial distinctions
between national and regional and/or local broadcast stations, and even without the
aggregate total airtime rule, candidates and parties are likely to be more inclined to
advertise in national broadcast stations.
Respondent likewise sees no merit in petitioners' claim that the Resolutions amount to
taking of private property without just compensation. Respondent emphasizes that

radio and television broadcasting companies do not own the airwaves and frequencies
through which they transmit broadcast signals; they are merely given the temporary
privilege to use the same. Since they are merely enjoying a privilege, the same may be
reasonably burdened with some form of public service, in this case, to provide
candidates with the opportunity to reply to charges aired against them.
Lastly, respondent contends that the public consultation requirement does not apply to
constitutional commissions such as the Comelec, pursuant to Section 1, Chapter I, Book
VII of the Administrative Code of 1987. Indeed, Section 9, Chapter II, Book VII of said
Code provides, thus:
ChanRoblesVirtualawlibrary

Section 9. Public Participation. - (1) If not otherwise required by law, an agency shall,
as far as practicable, publish or circulate notices of proposed rules and afford interested
parties the opportunity to submit their views prior to the adoption of any rule.
However, Section 1, Chapter 1, Book VII of said Code clearly provides:

ChanRoblesVirtualawlibrary

Section 1. Scope. - This Book shall be applicable to all agencies as defined in the next
succeeding section, except the Congress, the Judiciary, the Constitutional Commissions,
military establishments in all matters relating exclusively to Armed Forces personnel,
the Board of Pardons and Parole, and state universities and colleges.
Nevertheless, even if public participation is not required, respondent still conducted a
meeting with representatives of the KBP and various media outfits on December 26,
2012, almost a month before the issuance of Resolution No. 9615.
On April 2, 2013, petitioner GMA filed its Reply,14 where it advanced the following
counter-arguments:
ChanRoblesVirtualawlibrary

According to GMA, a petition for certiorari is the proper remedy to question the herein
assailed Resolutions, which should be considered as a decision, order or ruling of the
Commission as mentioned in Section 1, Rule 37 of the COMELEC Rules of Procedure
which provides:
ChanRoblesVirtualawlibrary

Section 1. Petition for Certiorari; and Time to File. - Unless otherwise provided by law,
or by any specific provisions in these Rules, any decision, order or ruling of the
Commission may be brought to the Supreme Court on certiorari by the aggrieved party
within thirty (30) days from its promulgation.
GMA further stressed that this case involves national interest, and the urgency of the
matter justifies its resort to the remedy of a petition for certiorari.
Therefore, GMA disagrees with the COMELEC's position that the proper remedy is a
petition for declaratory relief because such action only asks the court to make a proper
interpretation of the rights of parties under a statute or regulation. Such a petition
does not nullify the assailed statute or regulation, or grant injunctive relief, which
petitioners are praying for in their petition. Thus, GMA maintains that a petition
for certiorari is the proper remedy.
GMA further denies that it is making a collateral attack on the Fair Election Act, as it is
not attacking said law. GMA points out that it has stated in its petition that the law in

fact allows the sale or donation of airtime for political advertisements and does not
impose criminal liability against radio and television stations. What it is assailing is the
COMELEC's erroneous interpretation of the law's provisions by declaring such sale
and/or donation of airtime unlawful, which is contrary to the purpose of the Fair Election
Act.
GMA then claims that it has legal standing to bring the present suit because:

ChanRoblesVirtualawlibrary

x x x First, it has personally suffered a threatened injury in the form of risk of criminal
liability because of the alleged unconstitutional and unlawful conduct of respondent
COMELEC in expanding what was provided for in R.A. No. 9006. Second, the injury is
traceable to the challenged action of respondent COMELEC, that is, the issuance of the
assailed Resolutions. Third, the injury is likely to be redressed by the remedy sought in
petitioner GMA's Petition, among others, for the Honorable Court to nullify the
challenged pertinent provisions of the assailed Resolutions.15
cralawred

On substantive issues, GMA first argues that the questioned Resolutions are contrary to
the objective and purpose of the Fair Election Act. It points out that the Fair Election
Act even repealed the political ad ban found in the earlier law, R.A. No. 6646. The Fair
Election Act also speaks of equal opportunity and equal access, but said law never
mentioned equalizing the economic station of the rich and the poor, as a declared
policy. Furthermore, in its opinion, the supposed correlation between candidates'
expenditures for TV ads and actually winning the elections, is a mere illusion, as there
are other various factors responsible for a candidate's winning the election. GMA then
cites portions of the deliberations of the Bicameral Conference Committee on the bills
that led to the enactment of the Fair Election Act, and alleges that this shows the
legislative intent that airtime allocation should be on a per station basis. Thus, GMA
claims it was arbitrary and a grave abuse of discretion for the COMELEC to issue the
present Resolutions imposing airtime limitations on an aggregate total basis.
It is likewise insisted by GMA that the assailed Resolutions impose an unconstitutional
burden on them, because their failure to strictly monitor the duration of total airtime
that each candidate has purchased even from other stations would expose their officials
to criminal liability and risk losing the station's good reputation and goodwill, as well as
its franchise. It argues that the wordings of the Resolutions belie the COMELEC's claim
that petitioners would only incur liability if they knowingly sell airtime beyond the
limits imposed by the Resolutions, because the element of knowledge is clearly absent
from the provisions thereof. This makes the provisions have the nature of malum
prohibitum.
Next, GMA also says that the application of the aggregate airtime limit constitutes prior
restraint and is unconstitutional, opining that [t]he reviewing power of respondent
COMELEC and its sole judgment of a news event as a political advertisement are so
pervasive under the assailed Resolutions, and provoke the distastes or chilling effect of
prior restraint16 as even a legitimate exercise of a constitutional right might expose it
to legal sanction. Thus, the governmental interest of leveling the playing field between
rich and poor candidates cannot justify the restriction on the freedoms of expression,
speech and of the press.

On the issue of lack of prior public participation, GMA cites Section 82 of the Omnibus
Election Code, pertinent portions of which provide, thus:
ChanRoblesVirtualawlibrary

Section 82. Lawful election propaganda. - Lawful election propaganda shall include:
xxxx
All other forms of election propaganda not prohibited by this Code as the Commission
may authorize after due notice to all interested parties and hearing where all the
interested parties were given an equal opportunity to be heard: Provided, That the
Commission's authorization shall be published in two newspapers of general circulation
throughout the nation for at least twice within one week after the authorization has
been granted.
There having been no prior public consultation held, GMA contends that the COMELEC is
guilty of depriving petitioners of its right to due process of law.
GMA then concludes that it is also entitled to a temporary restraining order, because the
implementation of the Resolutions in question will cause grave and irreparable damage
to it by disrupting and emasculating its mandate to provide television and radio services
to the public, and by exposing it to the risk of incurring criminal and administrative
liability by requiring it to perform the impossible task of surveillance and monitoring, or
the broadcasts of other radio and television stations.
Thereafter, on April 4, 2013, the COMELEC, through the Office of the Solicitor General
(OSG), filed a Supplemental Comment and Opposition 17 where it further expounded on
the legislative intent behind the Fair Election Act, also quoting portions of the
deliberations of the Bicameral Conference Committee, allegedly adopting the Senate Bill
version setting the computation of airtime limits on a per candidate, not per station,
basis. Thus, as enacted into law, the wordings of Section 6 of the Fair Election
Act shows that the airtime limit is imposed on a per candidate basis, rather than on a
per station basis. Furthermore, the COMELEC states that petitioner-intervenor Senator
Cayetano is wrong in arguing that there should be empirical data to support the need to
change the computation of airtime limits from a per station basis to a per candidate
basis, because nothing in law obligates the COMELEC to support its Resolutions with
empirical data, as said airtime limit was a policy decision dictated by the legislature
itself, which had the necessary empirical and other data upon which to base said policy
decision.
The COMELEC then points out that Section 2 (7),18 Article IX (C) of the Constitution
empowers it to recommend to Congress effective measures to minimize election
spending and in furtherance of such constitutional power, the COMELEC issued the
questioned Resolutions, in faithful implementation of the legislative intent and
objectives of the Fair Election Act.
The COMELEC also dismisses Senator Cayetano's fears that unauthorized or inadvertent
inclusion of his name, initial, image, brand, logo, insignia and/or symbol in tandem
advertisements will be charged against his airtime limits by pointing out that what will
be counted against a candidate's airtime and expenditures are those advertisements
that have been paid for or donated to them to which the candidate has given consent.

With regard to the attack that the total aggregate airtime limit constitutes prior
restraint or undue abridgement of the freedom of speech and expression, the COMELEC
counters that the Resolutions enjoy constitutional and congressional imprimatur. It is
the Constitution itself that imposes the restriction on the freedoms of speech and
expression, during election period, to promote an important and significant
governmental interest, which is to equalize, as far as practicable, the situation of rich
and poor candidates by preventing the former from enjoying the undue advantage
offered by huge campaign 'war chests.'19
cralawre d

Lastly, the COMELEC also emphasizes that there is no impairment of the people's right
to information on matters of public concern, because in this case, the COMELEC is not
withholding access to any public record.
On April 16, 2013, this Court issued a Temporary Restraining Order 20 (TRO) in view of
the urgency involved and to prevent irreparable injury that may be caused to the
petitioners if respondent COMELEC is not enjoined from implementing Resolution No.
9615.
On April 19, 2013 respondent filed an Urgent Motion to Lift Temporary Restraining
Order and Motion for Early Resolution of the Consolidated Petitions. 21
cralawred

On May 8, 2013, petitioners ABS-CBN and the KBP filed its Opposition/Comment 22 to
the said Motion. Not long after, ABC followed suit and filed its own Opposition to the
Motion23 filed by the respondent.
In the interim, respondent filed a Second Supplemental Comment and
Opposition24 dated April 8, 2013.
In the Second Supplemental Comment and Opposition, respondent delved on points
which were not previously discussed in its earlier Comment and Supplemental
Comment, particularly those raised in the petition filed by petitioner ABS-CBN and KBP.
Respondent maintains that certiorari in not the proper remedy to question the
Constitutionality of the assailed Resolutions and that petitioners ABS-CBN and KBP have
no locus standi to file the present petition.
Respondent posits that contrary to the contention of petitioners, the legislative history
of R.A. No. 9006 conclusively shows that congress intended the airtime limits to be
computed on a per candidate and not on a per station basis. In addition, the legal
duty of monitoring lies with the COMELEC. Broadcast stations are merely required to
submit certain documents to aid the COMELEC in ensuring that candidates are not sold
airtime in excess of the allowed limits.
Also, as discussed in the earlier Comment, the prior notice requirement is a mechanism
designed to inform the COMELEC of the appearances or guesting of candidates in bona
fide news broadcasts. It is for monitoring purposes only, not censorship. It does not
control the subject matter of news broadcasts in anyway. Neither does it prevent
media outlets from covering candidates in news interviews, news events, and news
documentaries, nor prevent the candidates from appearing thereon.

As for the right to reply, respondent insists that the right to reply provision cannot be
considered a prior restraint on the freedoms of expression, speech and the press, as it
does not in any way restrict the airing of bona fide new broadcasts. Media entities are
free to report any news event, even if it should turn out to be unfavourable to a
candidate or party. The assailed Resolutions merely give the candidate or party the
right to reply to such charges published or aired against them in news broadcasts.
Moreover, respondent contends that the imposition of the penalty of suspension and
revocation of franchise or permit for the sale or donation of airtime beyond the
allowable limits is sanctioned by the Omnibus Election Code.
Meanwhile, RMN filed its Petition on April 8, 2013. On June 4, 2013, the Court issued a
Resolution25consolidating the case with the rest of the petitions and requiring
respondent to comment thereon.
On October 10, 2013, respondent filed its Third Supplemental Comment and
Opposition.26 Therein, respondent stated that the petition filed by RMN repeats the
issues that were raised in the previous petitions. Respondent, likewise, reiterated its
arguments that certiorari in not the proper remedy to question the assailed resolutions
and that RMN has no locus standi to file the present petition. Respondent maintains
that the arguments raised by RMN, like those raised by the other petitioners are without
merit and that RMN is not entitled to the injunctive relief sought.
The petition is partly meritorious.
At the outset, although the subject of the present petitions are Resolutions promulgated
by the COMELEC relative to the conduct of the 2013 national and local elections,
nevertheless the issues raised by the petitioners have not been rendered moot and
academic by the conclusion of the 2013 elections. Considering that the matters
elevated to the Court for resolution are susceptible to repetition in the conduct of future
electoral exercises, these issues will be resolved in the present action.
PROCEDURAL ASPECTS
Matters of procedure and technicalities normally take a backseat when issues of
substantial and transcendental importance are presented before the Court. So the Court
does again in this particular case.
Proper Remedy
Respondent claims that certiorari and prohibition are not the proper remedies that
petitioners have taken to question the assailed Resolutions of the Comelec. Technically,
respondent may have a point. However, considering the very important and pivotal
issues raised, and the limited time, such technicality should not deter the Court from
having to make the final and definitive pronouncement that everyone else depends for
enlightenment and guidance. [T]his Court has in the past seen fit to step in and
resolve petitions despite their being the subject of an improper remedy, in view of the
public importance of the issues raised therein.27
cralawred

It has been in the past, we do so again.

Locus Standi
Every time a constitutional issue is brought before the Court, the issue of locus standi is
raised to question the personality of the parties invoking the Courts jurisdiction. The
Court has routinely made reference to a liberalized stance when it comes to petitions
raising issues of transcendental importance to the country. Invariably, after some
discussions, the Court would eventually grant standing.28
cralawred

In this particular case, respondent also questions the standing of the petitioners. We
rule for the petitioners. For petitioner-intervenor Senator Cayetano, he undoubtedly has
standing since he is a candidate whose ability to reach out to the electorate is impacted
by the assailed Resolutions.
For the broadcast companies, they similarly have the standing in view of the direct
injury they may suffer relative to their ability to carry out their tasks of disseminating
information because of the burdens imposed on them. Nevertheless, even in regard to
the broadcast companies invoking the injury that may be caused to their customers or
the public those who buy advertisements and the people who rely on their broadcasts
what the Court said in White Light Corporation v. City of Manila29 may dispose of the
question. In that case, there was an issue as to whether owners of establishments
offering wash-up rates may have the requisite standing on behalf of their patrons
equal protection claims relative to an ordinance of the City of Manila which prohibited
short-time or wash-up accommodation in motels and similar establishments. The
Court essentially condensed the issue in this manner: [T]he crux of the matter is
whether or not these establishments have the requisite standing to plead for protection
of their patrons equal protection rights.30 The Court then went on to hold:
ChanRoblesVirtualawlibrary

Standing or locus standi is the ability of a party to demonstrate to the court sufficient
connection to and harm from the law or action challenged to support that partys
participation in the case. More importantly, the doctrine of standing is built on the
principle of separation of powers, sparing as it does unnecessary interference or
invalidation by the judicial branch of the actions rendered by its co-equal branches of
government.
The requirement of standing is a core component of the judicial system derived directly
from the Constitution. The constitutional component of standing doctrine incorporates
concepts which concededly are not susceptible of precise definition. In this jurisdiction,
the extancy of a direct and personal interest presents the most obvious cause, as well
as the standard test for a petitioners standing. In a similar vein, the United States
Supreme Court reviewed and elaborated on the meaning of the three constitutional
standing requirements of injury, causation, and redressability in Allen v. Wright.
Nonetheless, the general rules on standing admit of several exceptions such as the
overbreadth doctrine, taxpayer suits, third party standing and, especially in the
Philippines, the doctrine of transcendental importance.
For this particular set of facts, the concept of third party standing as an exception and
the overbreadth doctrine are appropriate. x x x
xxxx

American jurisprudence is replete with examples where parties-in-interest were allowed

standing to advocate or invoke the fundamental due process or equal protection claims
of other persons or classes of persons injured by state action. x x x
xxxx
Assuming arguendo that petitioners do not have a relationship with their patrons for the
former to assert the rights of the latter, the overbreadth doctrine comes into play. In
overbreadth analysis, challengers to government action are in effect permitted to raise
the rights of third parties. Generally applied to statutes infringing on the freedom of
speech, the overbreadth doctrine applies when a statute needlessly restrains even
constitutionally guaranteed rights. In this case, the petitioners claim that the
Ordinance makes a sweeping intrusion into the right to liberty of their clients. We can
see that based on the allegations in the petition, the Ordinance suffers from
overbreadth.
We thus recognize that the petitioners have a right to assert the constitutional rights of
their clients to patronize their establishments for a wash-rate time frame. 31
If in regard to commercial undertakings, the owners may have the right to assert a
constitutional right of their clients, with more reason should establishments which
publish and broadcast have the standing to assert the constitutional freedom of speech
of candidates and of the right to information of the public, not to speak of their own
freedom of the press. So, we uphold the standing of petitioners on that basis.
SUBSTANTIVE ASPECTS
Aggregate Time Limits
COMELEC Resolution No. 9615 introduced a radical departure from the previous
COMELEC resolutions relative to the airtime limitations on political advertisements. This
essentially consists in computing the airtime on an aggregate basis involving all the
media of broadcast communications compared to the past where it was done on a per
station basis. Thus, it becomes immediately obvious that there was effected a drastic
reduction of the allowable minutes within which candidates and political parties would
be able to campaign through the air. The question is accordingly whether this is within
the power of the Comelec to do or not. The Court holds that it is not within the power of
the Comelec to do so.
a. Past elections and airtime limits
The authority of the COMELEC to impose airtime limits directly flows from the Fair
Election Act (R.A. No. 9006 [2001])32 one hundred (120) minutes of television
advertisement and one-hundred eighty (180) minutes for radio advertisement. For the
2004 elections, the respondent COMELEC promulgated Resolution No.
652033 implementing the airtime limits by applying said limitation on a per
stationbasis.34 Such manner of determining airtime limits was likewise adopted for the
2007 elections, through Resolution No. 7767.35 In the 2010 elections, under Resolution
No. 8758,36 the same was again adopted. But for the 2013 elections, the COMELEC,

through Resolution No. 9615, as amended by Resolution No. 9631, chose

to aggregate the total broadcast time among the different broadcast media, thus:

ChanRoblesVirtualawlibrary

Section 9. Requirements and/or Limitations on the Use of Election Propaganda through

Mass Media. All parties and bona fide candidates shall have equal access to media
time and space for their election propaganda during the campaign period subject to the
following requirements and/or limitations:
ChanRoblesVirtualawlibrary

a. Broadcast Election Propaganda

The duration of an air time that a candidate, or party may use for their broadcast
advertisements or election propaganda shall be, as follows:

For
Candidates/Registered
Political parties for a
National Elective
Position

Not more than an aggregate total of one hundred

(120) minutes of television advertising, whether
appearing on national, regional, or local, free or
cable television, and one hundred eighty (180)
minutes of radio advertising, whether airing on
national, regional, or local radio, whether by
purchase or donation

For
Candidates/Registered
Political parties for a
Local
Elective Position

Not more than an aggregate total of sixty (60)

minutes of television advertising, whether
appearing on national, regional, or local, free or
cable television, and ninety (90) minutes of radio
advertising, whether airing on national, regional, or
local radio, whether by purchase or donation.

In cases where two or more candidates or parties whose names, initials, images,
brands, logos, insignias, color motifs, symbols, or forms of graphical representations
are displayed, exhibited, used, or mentioned together in the broadcast election
propaganda or advertisements, the length of time during which they appear or are
being mentioned or promoted will be counted against the airtime limits allotted for the
said candidates or parties and the cost of the said advertisement will likewise be
considered as their expenditures, regardless of whoever paid for the advertisements or
to whom the said advertisements were donated.
x x x x37

cralawre d

Corollarily, petitioner-intervenor, Senator Cayetano, alleges:

6.15. The change in the implementation of Section 6 of R.A. 9006 was undertaken by
respondent Comelec without consultation with the candidates for the 2013 elections,
affected parties such as media organizations, as well as the general public. Worse, said
change was put into effect without explaining the basis therefor and without showing
any data in support of such change. Respondent Comelec merely maintained that such
action is meant to level the playing field between the moneyed candidates and those
who dont have enough resources, without particularizing the empirical data upon
which such a sweeping statement was based. This was evident in the public hearing

held on 31 January 2013 where petitioner GMA, thru counsel, explained that no
empirical data on the excesses or abuses of broadcast media were brought to the
attention of the public by respondent Comelec, or even stated in the Comelec
Resolution No. 9615. Thus
xxxx
Chairman Brillantes
So if we can regulate and amplify, we may amplify meaning we can expand if we want
to. But the authority of the Commission is if we do not want to amplify and we think
that the 120 or 180 is okay we cannot be compelled to amplify. We think that 120 or
180 is okay, is enough.
Atty. Lucila
But with due respect Your Honor, I think the basis of the resolution is found in the law
and the law has been enterpreted (sic) before in 2010 to be 120 per station, so why the
change, your Honor?
Chairman Brillantes
No, the change is not there, the right to amplify is with the Commission on Elections.
Nobody can encroach in our right to amplify. Now, if in 2010 the Commission felt that
per station or per network is the rule then that is the prerogative of the Commission
then they could amplify it to expand it. If the current Commission feels that 120 is
enough for the particular medium like TV and 180 for radio, that is our prerogative.
How can you encroach and what is unconstitutional about it?
Atty. Lucila
We are not questioning the authority of the Honorable Commission to regulate Your
Honor, we are just raising our concern on the manner of regulation because as it is right
now, there is a changing mode or sentiments of the Commission and the public has the
right to know, was there rampant overspending on political ads in 2010, we were not
informed Your Honor. Was there abuse of the media in 2010, we were not informed Your
Honor. So we would like to know what is the basis of the sudden change in this
limitation, Your Honor. . And law must have a consistent interpretation that
[is]our position, Your Honor.
Chairman Brillantes
But my initial interpretation, this is personal to this representation counsel, is that if the
Constitution allows us to regulate and then it gives us the prerogative to amplify then
the prerogative to amplify you should leave this to the discretion of the Commission.
Which means if previous Commissions felt that expanding it should be part of our
authority that was a valid exercise if we reduce it to what is provided for by law which is
120-180 per medium, TV, radio, that is also within the law and that is still within our
prerogative as provided for by the Constitution. If you say we have to expose the
candidates to the public then I think the reaction should come, the negative reaction
should come from the candidates not from the media, unless you have some interest to
protect directly. Is there any interest on the part of the media to expand it?
Atty. Lucila
Well, our interest Your Honor is to participate in this election Your Honor and we have
been constantly (sic) as the resolution says and even in the part involved because you
will be getting some affirmative action time coming from the media itself and Comelec

time coming from the media itself. So we could like to be both involved in the whole
process of the exercise of the freedom of suffrage Your Honor.
Chairman Brillantes
Yes, but the very essence of the Constitutional provision as well as the provision of
9006 is actually to level the playing field. That should be the paramount consideration.
If we allow everybody to make use of all their time and all radio time and TV time then
there will be practically unlimited use of the mass media....
Atty. Lucila
Was there in 2010 Your Honor, was there any data to support that there was an
unlimited and abuse of a (sic) political ads in the mass media that became the basis of
this change in interpretation Your Honor? We would like to know about it Your Honor.
Chairman Brillantes
What do you think there was no abuse in 2010?
Atty. Lucila
As far as the network is concern, there was none Your Honor.
Chairman Brillantes
There was none......
Atty. Lucila
Im sorry, Your Honor...
Chairman Brillantes
Yes, there was no abuse, okay, but there was some advantage given to those who
took... who had the more moneyed candidates took advantage of it.
Atty. Lucila
But that is the fact in life, Your Honor there are poor candidates, there are rich
candidates. No amount of law or regulation can even level the playing filed (sic) as far
as the economic station in life of the candidates are concern (sic) our Honor.38
Given the foregoing observations about what happened during the hearing, PetitionerIntervenor went on to allege that:
ChanRoblesVirtualawlibrary

6.16. Without any empirical data upon which to base the regulatory measures in
Section 9 (a), respondent Comelec arbitrarily changed the rule from per station
basis to aggregate airtime basis. Indeed, no credence should be given to the cliched
explanation of respondent Comelec (i.e. leveling the playing field) in its published
statements which in itself is a mere reiteration of the rationale for the enactment of the
political ad ban of Republic Act No. 6646, and which has likewise been foisted when said
political ad ban was lifted by R.A. 9006.39
From the foregoing, it does appear that the Comelec did not have any other basis for
coming up with a new manner of determining allowable time limits except its own idea
as to what should be the maximum number of minutes based on its exercise of
discretion as to how to level the playing field. The same could be encapsulized in the
remark of the Comelec Chairman that if the Constitution allows us to regulate and then
it gives us the prerogative to amplify then the prerogative to amplify you should
leave this to the discretion of the Commission.40
cralawre d

The Court could not agree with what appears as a nonchalant exercise of discretion, as

expounded anon.
COMELEC is duty bound to come up
with reasonable basis for changing the
interpretation and implementation of
the airtime limits
There is no question that the COMELEC is the office constitutionally and statutorily
authorized to enforce election laws but it cannot exercise its powers without limitations
or reasonable basis. It could not simply adopt measures or regulations just because it
feels that it is the right thing to do, in so far as it might be concerned. It does have
discretion, but such discretion is something that must be exercised within the bounds
and intent of the law. The COMELEC is not free to simply change the rules especially if it
has consistently interpreted a legal provision in a particular manner in the past. If ever
it has to change the rules, the same must be properly explained with sufficient basis.
Based on the transcripts of the hearing conducted by the COMELEC after it had already
promulgated the Resolution, the respondent did not fully explain or justify the change in
computing the airtime allowed candidates and political parties, except to make
reference to the need to level the playing field. If the per station basis was deemed
enough to comply with that objective in the past, why should it now be suddenly
inadequate? And, the short answer to that from the respondent, in a manner which
smacks of overbearing exercise of discretion, is that it is within the discretion of the
COMELEC. As quoted in the transcript, the right to amplify is with the COMELEC.
Nobody can encroach in our right to amplify. Now, if in 2010 the Commission felt that
per station or per network is the rule then that is the prerogative of the Commission
then they could amplify it to expand it. If the current Commission feels that 120 is
enough for the particular medium like TV and 180 for radio, that is our prerogative.
How can you encroach and what is unconstitutional about it? 41
cralawre d

There is something basically wrong with that manner of explaining changes in

administrative rules. For one, it does not really provide a good basis for change. For
another, those affected by such rules must be given a better explanation why the
previous rules are no longer good enough. As the Court has said in one case:
ChanRoblesVirtualawlibrary

While stability in the law, particularly in the business field, is desirable, there is no
demand that the NTC slavishly follow precedent. However, we think it essential, for the
sake of clarity and intellectual honesty, that if an administrative agency decides
inconsistently with previous action, that it explain thoroughly why a different result is
warranted, or if need be, why the previous standards should no longer apply or should
be overturned. Such explanation is warranted in order to sufficiently establish a
decision as having rational basis. Any inconsistent decision lacking thorough,
ratiocination in support may be struck down as being arbitrary. And any decision with
absolutely nothing to support it is a nullity.42
What the COMELEC came up with does not measure up to that level of requirement and
accountability which elevates administrative rules to the level of respectability and
acceptability. Those governed by administrative regulations are entitled to a reasonable
and rational basis for any changes in those rules by which they are supposed to live by,
especially if there is a radical departure from the previous ones.

The COMELEC went beyond the

authority granted it by the law in
adopting aggregate basis in the
determination of allowable airtime
The law, which is the basis of the regulation subject of these petitions, pertinently
provides:
ChanRoblesVirtualawlibrary

6.2. (a) Each bona fide candidate or registered political party for a nationally elective
office shall be entitled to not more than one hundred twenty (120) minutes of television
advertisement and one hundred eighty (180) minutes of radio advertisement whether
by purchase or donation.
(b) Each bona fide candidate or registered political party for a locally elective office shall
be entitled to not more than sixty (60) minutes of television advertisement and ninety
(90) minutes of radio advertisement whether by purchase or donation; x x x
The law, on its face, does not justify a conclusion that the maximum allowable airtime
should be based on the totality of possible broadcast in all television or radio stations.
Senator Cayetano has called our attention to the legislative intent relative to the airtime
allowed that it should be on a per station basis. 43
cralawre d

This is further buttressed by the fact that the Fair Election Act (R.A. No. 9006) actually
repealed the previous provision, Section 11(b) of Republic Act No. 6646, 44 which
prohibited direct political advertisements the so-called political ad ban. If under the
previous law, no candidate was allowed to directly buy or procure on his own his
broadcast or print campaign advertisements, and that he must get it through
the COMELEC Time or COMELEC Space, R.A. No. 9006 relieved him or her from that
restriction and allowed him or her to broadcast time or print space subject to the
limitations set out in the law. Congress, in enacting R.A. No. 9006, felt that the
previous law was not an effective and efficient way of giving voice to the people. Noting
the debilitating effects of the previous law on the right of suffrage and Philippine
democracy, Congress decided to repeal such rule by enacting the Fair Election Act.
In regard to the enactment of the new law, taken in the context of the restrictive nature
of the previous law, the sponsorship speech of Senator Raul Roco is enlightening:
ChanRoblesVirtualawlibrary

The bill seeks to repeal Section 85 of the Omnibus Election Code and Sections 10 and
11 of RA 6646. In view of the importance of their appeal in connection with the thrusts
of the bill, I hereby quote these sections in full:
ChanRoblesVirtualawlibrary

SEC. 85. Prohibited forms of election propaganda. It shall be unlawful:

ChanRoblesVirtualawlibrary

(a) To print, publish, post or distribute any poster, pamphlet, circular, handbill, or
printed matter urging voters to vote for or against any candidate unless they hear the
names and addresses of the printed and payor as required in Section 84 hereof;
(b) To erect, put up, make use of, attach, float or display any billboard, tinplateposter, balloons and the like, of whatever size, shape, form or kind, advertising for or
against any candidate or political party;

(c) To purchase, manufacture, request, distribute or accept electoral propaganda

gadgets, such as pens, lighters, fans of whatever nature, flashlights, athletic goods or
materials, wallets, shirts, hats, bandannas, matches, cigarettes and the like, except
that campaign supporters accompanying a candidate shall be allowed to wear hats
and/or shirts or T-shirts advertising a candidate;
(d) To show or display publicly any advertisement or propaganda for or against any
candidate by means of cinematography, audio-visual units or other screen projections
except telecasts which may be allowed as hereinafter provided; and
(e) For any radio broadcasting or television station to sell or give free of charge
airtime for campaign and other political purposes except as authorized in this Code
under the rules and regulations promulgated by the Commission pursuant thereto;
Any prohibited election propaganda gadget or advertisement shall be stopped,
confiscated or torn down by the representative of the Commission upon specific
authority of the Commission.
SEC. 10. Common Poster Areas. The Commission shall designate common poster
areas in strategic public places such as markets, barangay centers and the like wherein
candidates can post, display or exhibit election propaganda to announce or further their
candidacy.
Whenever feasible common billboards may be installed by the Commission and/or nonpartisan private or civic organizations which the Commission may authorize whenever
available, after due notice and hearing, in strategic areas where it may readily be seen
or read, with the heaviest pedestrian and/or vehicular traffic in the city or municipality.
The space in such common poster areas or billboards shall be allocated free of charge,
if feasible, equitably and impartially among the candidates in the province, city or
municipality.
SEC. 11. Prohibited Forms of Election Propaganda. In addition to the forms of
election propaganda prohibited under Section 85 of Batas Pambansa Blg. 881, it shall
be unlawful: (a) to draw, paint, inscribe, write, post, display or publicly exhibit any
election propaganda in any place, whether private or public, except in common poster
areas and/or billboards provided in the immediately preceding section, at the
candidates own residence, or at the campaign headquarters of the candidate or political
party: Provided, That such posters or election propaganda shall in no case exceed two
(2) feet by three (3) feet in area; Provided, further, That at the site of and on the
occasion of a public meeting or rally, streamers, not more than two (2) feet and not
exceeding three (3) feet by eight (8) each may be displayed five (5) days before the
date of the meeting or rally, and shall be removed within twenty-four (24) hours after
said meeting or rally; and
(b) For any newspapers, radio broadcasting or television station, or other mass media,
or any person making use of the mass media to sell or give for free of charge print
space or air time for campaign or other political purposes except to the Commission as
provided under Section 90 and 92 of Batas Pambansa Blg. 881. Any mass media

columnist, commentator, announcer or personality who is a candidate for any elective

public office shall take a leave of absence from his work as such during the campaign.
The repeal of the provision on the Common Poster Area implements the strong
recommendations of the Commission on Elections during the hearings. It also seeks to
apply the doctrine enunciated by the Supreme Court in the case of Blo Umpar Adiong
vs. Commission on Elections, 207 SCRA 712, 31 March 1992. Here a unanimous
Supreme Court ruled: The COMELECs prohibition on the posting of decals and stickers
on mobile places whether public or private except [in] designated areas provided for
by the COMELEC itself is null and void on constitutional grounds.
For the foregoing reasons, we commend to our colleagues the early passage of Senate
Bill No. 1742. In so doing, we move one step towards further ensuring free, orderly,
honest, peaceful and credible elections as mandated by the Constitution. 45
Given the foregoing background, it is therefore ineluctable to conclude that Congress
intended to provide a more expansive and liberal means by which the candidates,
political parties, citizens and other stake holders in the periodic electoral exercise may
be given a chance to fully explain and expound on their candidacies and platforms of
governance, and for the electorate to be given a chance to know better the
personalities behind the candidates. In this regard, the media is also given a very
important part in that undertaking of providing the means by which the political
exercise becomes an interactive process. All of these would be undermined and
frustrated with the kind of regulation that the respondent came up with.
The respondent gave its own understanding of the import of the legislative deliberations
on the adoption of R.A. No. 9006 as follows:
ChanRoblesVirtualawlibrary

The legislative history of R.A. 9006 clearly shows that Congress intended to impose the
per candidate or political party aggregate total airtime limits on political advertisements
and election propaganda. This is evidenced by the dropping of the per day per station
language embodied in both versions of the House of Representatives and Senate bills in
favour of the each candidate and not more than limitations now found in Section 6
of R.A. 9006.
The pertinent portions of House Bill No. 9000 and Senate Bill No. 1742 read as
follows:
ChanRoblesVirtualawlibrary

House Bill No. 9000:

SEC. 4. Section 86 of the same Batas is hereby amended to read as follows:
Sec. 86. Regulation of Election Propaganda Through Mass Media.
xxx

xxx

xxx

A) The total airtime available to the candidate and political party, whether by
purchase or by donation, shall be limited to five (5) minutes per day in each
television, cable television and radio stations during the applicable campaign
period.
Senate Bill No. 1742:

SEC. 5. Equal Access to Media Space and Time. All registered parties and bona fide
candidates shall have equal access to media space and time. The following guidelines
may be amplified by the COMELEC.
xxx

xxx

xxx

2. The total airtime available for each registered party and bona fide
candidate whether by purchase or donation shall not exceed a total of one (1)
minute per day per television or radio station. (Emphasis supplied.)
As Section 6 of R.A. 9006 is presently worded, it can be clearly seen that the legislature
intended the aggregate airtime limits to be computed on per candidate or party basis.
Otherwise, if the legislature intended the computation to be on per station basis, it
could have left the original per day per station formulation. 46
The Court does not agree. It cannot bring itself to read the changes in the bill as
disclosing an intent that the COMELEC wants this Court to put on the final language of
the law. If anything, the change in language meant that the computation must not be
based on a per day basis for each television or radio station. The same could not
therefore lend itself to an understanding that the total allowable time is to be done on
an aggregate basis for all television or radio stations.
Clearly, the respondent in this instance went beyond its legal mandate when it provided
for rules beyond what was contemplated by the law it is supposed to implement. As we
held in Lokin, Jr. v. Commission on Elections:47
cralawre d

The COMELEC, despite its role as the implementing arm of the Government in the
enforcement and administration of all laws and regulations relative to the conduct of an
election, has neither the authority nor the license to expand, extend, or add anything to
the law it seeks to implement thereby. The IRRs the COMELEC issued for that purpose
should always be in accord with the law to be implemented, and should not override,
supplant, or modify the law. It is basic that the IRRs should remain consistent with the
law they intend to carry out.
Indeed, administrative IRRs adopted by a particular department of the Government
under legislative authority must be in harmony with the provisions of the law, and
should be for the sole purpose of carrying the laws general provisions into effect. The
law itself cannot be expanded by such IRRs, because an administrative agency cannot
amend an act of Congress.48
In the case of Lokin, Jr., the COMELECs explanation that the Resolution then in
question did not add anything but merely reworded and rephrased the statutory
provision did not persuade the Court. With more reason here since the COMELEC not
only reworded or rephrased the statutory provision it practically replaced it with its
own idea of what the law should be, a matter that certainly is not within its authority.
As the Court said in Villegas v. Subido:49
cralawred

One last word. Nothing is better settled in the law than that a public official exercises
power, not rights. The government itself is merely an agency through which the will of
the state is expressed and enforced. Its officers therefore are likewise agents entrusted
with the responsibility of discharging its functions. As such there is no presumption that

they are empowered to act. There must be a delegation of such authority, either
express or implied. In the absence of a valid grant, they are devoid of power. What they
do suffers from a fatal infirmity. That principle cannot be sufficiently stressed. In the
appropriate language of Chief Justice Hughes: It must be conceded that departmental
zeal may not be permitted to outrun the authority conferred by statute. Neither the
high dignity of the office nor the righteousness of the motive then is an acceptable
substitute. Otherwise the rule of law becomes a myth. Such an eventuality, we must
take all pains to avoid.50
So it was then. So does the rule still remains the same.
Section 9 (a) of COMELEC Resolution
No. 9615 on airtime limits also goes
against the constitutional guaranty of
freedom of expression, of speech
and of the press
The guaranty of freedom to speak is useless without the ability to communicate and
disseminate what is said. And where there is a need to reach a large audience, the need
to access the means and media for such dissemination becomes critical. This is where
the press and broadcast media come along. At the same time, the right to speak and to
reach out would not be meaningful if it is just a token ability to be heard by a few. It
must be coupled with substantially reasonable means by which the communicator and
the audience could effectively interact. Section 9 (a) of COMELEC Resolution No. 9615,
with its adoption of the aggregate-based airtime limits unreasonably restricts the
guaranteed freedom of speech and of the press.
Political speech is one of the most important expressions protected by the Fundamental
Law. [F]reedom of speech, of expression, and of the press are at the core of civil
liberties and have to be protected at all costs for the sake of democracy.51 Accordingly,
the same must remain unfettered unless otherwise justified by a compelling state
interest.
In regard to limitations on political speech relative to other state interests, an American
case observed:
ChanRoblesVirtualawlibrary

A restriction on the amount of money a person or group can spend on political

communication during a campaign necessarily reduces the quantity of expression by
restricting the number of issues discussed, the depth of their exploration, and the size
of the audience reached. This is because virtually every means of communicating ideas
in todays mass society requires the expenditure of money. The distribution of the
humblest handbill or leaflet entails printing, paper, and circulation costs. Speeches and
rallies generally necessitate hiring a hall and publicizing the event. The electorates
increasing dependence on television, radio, and other mass media for news and
information has made these expensive modes of communication indispensable
instruments of effective political speech.
The expenditure limitations contained in the Act represent substantial, rather than
merely theoretical restraints on the quantity and diversity of political speech. The
$1,000 ceiling on spending relative to a clearly identified candidate, 18 U.S.C.
608(e)(1) (1970 ed., Supp. IV), would appear to exclude all citizens and groups except

candidates, political parties, and the institutional press from any significant use of the
most effective modes of communication. Although the Acts limitations on expenditures
by campaign organizations and political parties provide substantially greater room for
discussion and debate, they would have required restrictions in the scope of a number
of past congressional and Presidential campaigns and would operate to constrain
campaigning by candidates who raise sums in excess of the spending ceiling. 52
Section 9 (a) of COMELEC Resolution No. 9615 comes up with what is challenged as
being an unreasonable basis for determining the allowable air time that candidates and
political parties may avail of. Petitioner GMA came up with its analysis of the practical
effects of such a regulation:
ChanRoblesVirtualawlibrary

5.8. Given the reduction of a candidates airtime minutes in the New Rules, petitioner
GMA estimates that a national candidate will only have 120 minutes to utilize for his
political advertisements in television during the whole campaign period of 88 days, or
will only have 81.81 seconds per day TV exposure allotment. If he chooses to place
his political advertisements in the 3 major TV networks in equal allocation, he will only
have 27.27 seconds of airtime per network per day. This barely translates to 1
advertisement spot on a 30-second spot basis in television.
5.9. With a 20-hour programming per day and considering the limits of a stations
coverage, it will be difficult for 1 advertising spot to make a sensible and feasible
communication to the public, or in political propaganda, to make known [a candidates]
qualifications and stand on public issues.
5.10 If a candidate loads all of his 81.81 seconds per day in one network, this will
translate to barely three 30-second advertising spots in television on a daily basis using
the same assumptions above.
5.11 Based on the data from the 2012 Nielsen TV audience measurement in Mega
Manila, the commercial advertisements in television are viewed by only 39.2% of the
average total day household audience if such advertisements are placed with petitioner
GMA, the leading television network nationwide and in Mega Manila. In effect, under
the restrictive aggregate airtime limits in the New Rules, the three 30-second political
advertisements of a candidate in petitioner GMA will only be communicated to barely
40% of the viewing audience, not even the voting population, but only in Mega Manila,
which is defined by AGB Nielsen Philippines to cover Metro Manila and certain urban
areas in the provinces of Bulacan, Cavite, Laguna, Rizal, Batangas and Pampanga.
Consequently, given the voting population distribution and the drastically reduced
supply of airtime as a result of the New Rules aggregate airtime limits, a national
candidate will be forced to use all of his airtime for political advertisements in television
only in urban areas such as Mega Manila as a political campaign tool to achieve
maximum exposure.
5.12 To be sure, the people outside of Mega Manila or other urban areas deserve to be
informed of the candidates in the national elections, and the said candidates also enjoy
the right to be voted upon by these informed populace. 53
The Court agrees. The assailed rule on aggregate-based airtime limits is unreasonable
and arbitrary as it unduly restricts and constrains the ability of candidates and political

parties to reach out and communicate with the people. Here, the adverted reason for
imposing the aggregate-based airtime limits leveling the playing field does not
constitute a compelling state interest which would justify such a substantial restriction
on the freedom of candidates and political parties to communicate their ideas,
philosophies, platforms and programs of government. And, this is specially so in the
absence of a clear-cut basis for the imposition of such a prohibitive measure. In this
particular instance, what the COMELEC has done is analogous to letting a bird fly after
one has clipped its wings.
It is also particularly unreasonable and whimsical to adopt the aggregate-based time
limits on broadcast time when we consider that the Philippines is not only composed of
so many islands. There are also a lot of languages and dialects spoken among the
citizens across the country. Accordingly, for a national candidate to really reach out to
as many of the electorates as possible, then it might also be necessary that he conveys
his message through his advertisements in languages and dialects that the people may
more readily understand and relate to. To add all of these airtimes in different dialects
would greatly hamper the ability of such candidate to express himself a form of
suppression of his political speech.
Respondent itself states that [t]elevision is arguably the most cost-effective medium of
dissemination. Even a slight increase in television exposure can significantly boost a
candidate's popularity, name recall and electability.54 If that be so, then drastically
curtailing the ability of a candidate to effectively reach out to the electorate would
unjustifiably curtail his freedom to speak as a means of connecting with the people.
Finally on this matter, it is pertinent to quote what Justice Black wrote in his concurring
opinion in the landmark Pentagon Papers case: In the First Amendment, the Founding
Fathers gave the free press the protection it must have to fulfill its essential role in our
democracy. The press was to serve the governed, not the governors. The Government's
power to censor the press was abolished so that the press would remain forever free to
censure the Government. The press was protected so that it could bare the secrets of
government and inform the people. Only a free and unrestrained press can effectively
expose deception in government.55
cralawre d

In the ultimate analysis, when the press is silenced, or otherwise muffled in its
undertaking of acting as a sounding board, the people ultimately would be the victims.
Section 9 (a) of Resolution 9615 is
violative of the peoples
right to suffrage
Fundamental to the idea of a democratic and republican state is the right of the people
to determine their own destiny through the choice of leaders they may have in
government. Thus, the primordial importance of suffrage and the concomitant right of
the people to be adequately informed for the intelligent exercise of such birthright. It
was said that:
ChanRoblesVirtualawlibrary

x x x As long as popular government is an end to be achieved and safeguarded,

suffrage, whatever may be the modality and form devised, must continue to be the
means by which the great reservoir of power must be emptied into the receptacular

agencies wrought by the people through their Constitution in the interest of good
government and the common weal. Republicanism, in so far as it implies the adoption
of a representative type of government, necessarily points to the enfranchised citizen as
a particle of popular sovereignty and as the ultimate source of the established authority.
He has a voice in his Government and whenever possible it is the solemn duty of the
judiciary, when called upon to act in justifiable cases, to give it efficacy and not to stifle
or frustrate it. This, fundamentally, is the reason for the rule that ballots should be read
and appreciated, if not with utmost, with reasonable, liberality. x x x 56
It has also been said that [c]ompetition in ideas and governmental policies is at the
core of our electoral process and of the First Amendment freedoms.57 Candidates and
political parties need adequate breathing space including the means to disseminate
their ideas. This could not be reasonably addressed by the very restrictive manner by
which the respondent implemented the time limits in regard to political advertisements
in the broadcast media.
Resolution No. 9615 needs
prior hearing before adoption
The COMELEC promulgated Resolution No. 9615 on January 15, 2013 then came up
with a public hearing on January 31, 2013 to explain what it had done, particularly on
the aggregate-based air time limits. This circumstance also renders the new regulation,
particularly on the adoption of theaggregate-based airtime limit, questionable. It
must not be overlooked that the new Resolution introduced a radical change in the
manner in which the rules on airtime for political advertisements are to be reckoned. As
such there is a need for adequate and effective means by which they may be adopted,
disseminated and implemented. In this regard, it is not enough that they be published
or explained after they have been adopted.
While it is true that the COMELEC is an independent office and not a mere
administrative agency under the Executive Department, rules which apply to the latter
must also be deemed to similarly apply to the former, not as a matter of administrative
convenience but as a dictate of due process. And this assumes greater significance
considering the important and pivotal role that the COMELEC plays in the life of the
nation. Thus, whatever might have been said in Commissioner of Internal Revenue v.
Court of Appeals,58 should also apply mutatis mutandis to the COMELEC when it comes
to promulgating rules and regulations which adversely affect, or impose a heavy and
substantial burden on, the citizenry in a matter that implicates the very nature of
government we have adopted:
ChanRoblesVirtualawlibrary

It should be understandable that when an administrative rule is merely interpretative in

nature, its applicability needs nothing further than its bare issuance for it gives no real
consequence more than what the law itself has already prescribed. When, upon the
other hand, the administrative rule goes beyond merely providing for the means that
can facilitate or render least cumbersome the implementation of the law
butsubstantially adds to or increases the burden of those governed, it behooves
the agency to accord at least to those directly affected a chance to be heard, and
thereafter to be duly informed, before that new issuance is given the force and effect
of law.
A reading of RMC 3793, particularly considering the circumstances under which it has

been issued, convinces us that the circular cannot be viewed simply as a corrective
measure (revoking in the process the previous holdings of past Commissioners) or
merely as construing Section 142(c)(1) of the NIRC, as amended, but has, in fact and
most importantly, been made in order to place Hope Luxury, Premium More and
Champion within the classification of locally manufactured cigarettes bearing foreign
brands and to thereby have them covered by RA 7654. Specifically, the new law would
have its amendatory provisions applied to locally manufactured cigarettes which at the
time of its effectivity were not so classified as bearing foreign brands. x x x In so doing,
the BIR not simply interpreted the law; verily, it legislated under its quasi-legislative
authority. The due observance of the requirements of notice, of hearing, and of
publication should not have been then ignored.59
For failing to conduct prior hearing before coming up with Resolution No. 9615, said
Resolution, specifically in regard to the new rule on aggregate airtime is declared
defective and ineffectual.
Resolution No. 9615 does not impose
an unreasonable burden on the
broadcast industry
It is a basic postulate of due process, specifically in relation to its substantive
component, that any governmental rule or regulation must be reasonable in its
operations and its impositions. Any restrictions, as well as sanctions, must be
reasonably related to the purpose or objective of the government in a manner that
would not work unnecessary and unjustifiable burdens on the citizenry. Petitioner GMA
assails certain requirements imposed on broadcast stations as unreasonable. It
explained:
ChanRoblesVirtualawlibrary

5.40 Petitioner GMA currently operates and monitors 21 FM and AM radio stations
nationwide and 8 originating television stations (including its main transmitter in
Quezon City) which are authorized to dechain national programs for airing and insertion
of local content and advertisements.
5.41 In light of the New Rules wherein a candidates airtime minutes are applied on an
aggregate basis and considering that said Rules declare it unlawful in Section 7(d)
thereof for a radio, television station or other mass media to sell or give for free airtime
to a candidate in excess of that allowed by law or by said New Rules:
ChanRoblesVirtualawlibrary

Section 7. Prohibited Forms of Election Propaganda During the campaign period, it is

unlawful:
ChanRoblesVirtualawlibrary

xxx xxx xxx

(d) for any newspaper or publication, radio, television or cable television station,
or other mass media, or any person making use of the mass media to sell or to
give free of charge print space or air time for campaign or election propaganda
purposes to any candidate or party in excess of the size, duration or frequency
authorized by law or these rules;
xxx xxx xxx
(Emphasis supplied)

petitioner GMA submits that compliance with the New Rules in order to avoid
administrative or criminal liability would be unfair, cruel and oppressive.
x x x x.
5.43 In the present situation wherein airtime minutes shall be shared by all television
and radio stations, broadcast mass media organizations would surely encounter
insurmountable difficulties in monitoring the airtime minutes spent by the numerous
candidates for various elective positions, in real time.
5.44 An inquiry with the National Telecommunications Commission (NTC) bears out that
there are 372 television stations and 398 AM and 800 FM radio stations nationwide as
of June 2012. In addition, there are 1,113 cable TV providers authorized by the NTC to
operate within the country as of the said date.
5.45 Given such numbers of broadcast entities and the necessity to monitor political
advertisements pursuant to the New Rules, petitioner GMA estimates that monitoring
television broadcasts of all authorized television station would involve 7,440 manhours
per day. To aggravate matters, since a candidate may also spend his/her broadcasting
minutes on cable TV, additional 281,040 manhours per day would have to be spent in
monitoring the various channels carried by cable TV throughout the Philippines. As far
as radio broadcasts (both AM and FM stations) are concerned, around 23,960manhours
per day would have to be devoted by petitioner GMA to obtain an accurate and timely
determination of a political candidates remaining airtime minutes. During the
campaign period, petitioner GMA would have to spend an
estimated 27,494,720manhours in monitoring the election campaign commercials of
the different candidates in the country.
5.46 In order to carry-out the obligations imposed by the New Rules, petitioner GMA
further estimates that it would need to engage and train 39,055 additional persons on
an eight-hour shift, and assign them all over the country to perform the required
monitoring of radio, television and cable TV broadcasts. In addition, it would likewise
need to allot radio, television, recording equipment and computers, as well as
telecommunications equipment, for this surveillance and monitoring exercise, thus
imputing additional costs to the company. Attached herewith are the computations
explaining how the afore-said figures were derived and the conservative assumptions
made by petitioner GMA in reaching said figures, as Annex H.
5.47 Needless to say, such time, manpower requirements, expense and effort would
have to be replicated by each and every radio station to ensure that they have properly
monitored around 33 national and more than 40,000 local candidates airtime minutes
and thus, prevent any risk of administrative and criminal liability.60
The Court cannot agree with the contentions of GMA. The apprehensions of the
petitioner appear more to be the result of a misappreciation of the real import of the
regulation rather than a real and present threat to its broadcast activities. The Court is
more in agreement with the respondent when it explained that:
ChanRoblesVirtualawlibrary

The legal duty of monitoring lies with the Comelec. Broadcast stations are merely
required to submit certain documents to aid the Comelec in ensuring that candidates
are not sold airtime in excess of the allowed limits. These documents include: (1)
certified true copies of broadcast logs, certificates of performance, and certificates of
acceptance, or other analogous record on specified dates (Section 9[d] 3, Resolution No.
9615, in relation to Section 6.2, R.A. 9006; and (2) copies of all contract for
advertising, promoting or opposing any political party or the candidacy of any person
for public office within five (5) days after its signing (Section 6.3, R.A. 9006).
*****
[T]here is absolutely no duty on the broadcast stations to do monitoring, much less
monitoring in real time. GMA grossly exaggerates when it claims that the non-existent
duty would require them to hire and train an astounding additional 39,055 personnel
working on eight-hour shifts all over the country.61
The Court holds, accordingly, that, contrary to petitioners contention, the Reporting
Requirement for the Comelecs monitoring is reasonable.
Further, it is apropos to note that, pursuant to Resolution No. 9631, 62 the respondent
revised the third paragraph of Section 9 (a). As revised, the provision now reads:
ChanRoblesVirtualawlibrary

Appearance or guesting by a candidate on any bona fide newscast, bona fide news
interview, bona fide news documentary, if the appearance of the candidate is incidental
to the presentation of the subject or subjects covered by the news documentary, or onthe-spot coverage of bona fide news events, including but not limited to events
sanctioned by the Commission on Elections, political conventions, and similar activities,
shall not be deemed to be broadcast election propaganda within the meaning of this
provision. For purposes of monitoring by the COMELEC and ensuring that
parties and candidates were afforded equal opportunities to promote their
candidacy, the media entity shall give prior notice to the COMELEC, through
the appropriate Regional Election Director (RED), or in the case of the National
Capital Region (NCR), the Education and Information Department (EID). If
such prior notice is not feasible or practicable, the notice shall be sent within
twenty-four (24) hours from the first broadcast or publication. Nothing in the
foregoing sentence shall be construed as relieving broadcasters, in connection with the
presentation of newscasts, news interviews, news documentaries, and on-the-spot
coverage of news events, from the obligation imposed upon them under Sections 10
and 14 of these Rules. 63
Further, the petitioner in G.R. No. 205374 assails the constitutionality of such
monitoring requirement, contending, among others, that it constitutes prior restraint.
The Court finds otherwise. Such a requirement is a reasonable means adopted by the
COMELEC to ensure that parties and candidates are afforded equal opportunities to
promote their respective candidacies. Unlike the restrictive aggregate-based airtime
limits, the directive to give prior notice is not unduly burdensome and unreasonable,
much less could it be characterized as prior restraint since there is no restriction on
dissemination of information before broadcast.

Additionally, it is relevant to point out that in the original Resolution No. 9615, the
paragraph in issue was worded in this wise:
ChanRoblesVirtualawlibrary

Appearance or guesting by a candidate on any bona fide newscast, bona fide news
interview, bona fide news documentary, if the appearance of the candidate is incidental
to the presentation of the subject or subjects covered by the news documentary, or onthe-spot coverage of bona fide news events, including but not limited to events
sanctioned by the Commission on Elections, political conventions, and similar activities,
shall not be deemed to be broadcast election propaganda within the meaning of this
provision. To determine whether the appearance or guesting in a program is
bona fide, the broadcast stations or entities must show that (1) prior approval
of the Commission was secured; and (2) candidates and parties were afforded
equal opportunities to promote their candidacy. Nothing in the foregoing sentence
shall be construed as relieving broadcasters, in connection with the presentation of
newscasts, news interviews, news documentaries, and on-the-spot coverage of news
events, from the obligation imposed upon them under Sections 10 and 14 of these
Rules. 64
Comparing the original with the revised paragraph, one could readily appreciate what
the COMELEC had done to modify the requirement from prior approval to prior
notice. While the former may be suggestive of a censorial tone, thus inviting a charge
of prior restraint, the latter is more in the nature of a content-neutral regulation
designed to assist the poll body to undertake its job of ensuring fair elections without
having to undertake any chore of approving or disapproving certain expressions.
Also, the right to reply provision is reasonable
In the same way that the Court finds the prior notice requirement as not
constitutionally infirm, it similarly concludes that the right to reply provision is
reasonable and consistent with the constitutional mandate.
Section 14 of Resolution No. 9615, as revised by Resolution No. 9631, provides:

ChanRoblesVirtualawlibrary

SECTION 14. Right to Reply. All registered political parties, party-list groups or
coalitions and bona fide candidates shall have the right to reply to charges published or
aired against them. The reply shall be given publicity by the newspaper, television,
and/or radio station which first printed or aired the charges with the same prominence
or in the same page or section or in the same time slot as the first statement.
Registered political parties, party-list groups or coalitions and bona fide candidates may
invoke the right to reply by submitting within a non-extendible period of forty-eight
hours from first broadcast or publication, a formal verified claim against the media
outlet to the COMELEC, through the appropriate RED. The claim shall include a detailed
enumeration of the circumstances and occurrences which warrant the invocation of the
right to reply and must be accompanied by supporting evidence, such a copy of the
publication or recording of the television or radio broadcast, as the case may be. If the
supporting evidence is not yet available due to circumstances beyond the power of the
claimant, the latter shall supplement his claim as soon as the supporting evidence
becomes available, without delay on the part of the claimant. The claimant must
likewise furnish a copy of the verified claim and its attachments to the media outlet
concerned prior to the filing of the claim with the COMELEC.

The COMELEC, through the RED, shall view the verified claim within forty-eight (48)
hours from receipt thereof, including supporting evidence, and if circumstances warrant,
give notice to the media outlet involved for appropriate action, which shall, within fortyeight (48) hours, submit its comment, answer or response to the RED, explaining the
action it has taken to address the claim. The media outlet must likewise furnish a copy
of the said comment, answer or response to the claimant invoking the right to reply.
Should the claimant insist that his/her right to reply was not addressed, he/she may file
the appropriate petition and/or complaint before the Commission on Elections or its
field offices, which shall be endorsed to the Clerk of Court.
The attack on the validity of the right to reply provision is primarily anchored on the
alleged ground of prior restraint, specifically in so far as such a requirement may have a
chilling effect on speech or of the freedom of the press.
Petitioner ABC states, inter alia:
5.145. A conscious and detailed consideration of the interplay of the relevant interests
the constitutional mandate granting candidates the right to reply and the inviolability
of the constitutional freedom of expression, speech, and the press will show that the
Right to Reply, as provided for in the Assailed Resolution, is an impermissible restraint
on these fundamental freedoms.
5.146. An evaluation of the factors set forth in Soriano (for the balancing of interests
test) with respect to the present controversy will show that the Constitution does not
tilt the balance in favor of the Right to Reply provision in the Assailed Resolution and
the supposed governmental interest it attempts to further.65
The Constitution itself provides as part of the means to ensure free, orderly, honest, fair
and credible elections, a task addressed to the COMELEC to provide for a right to
reply.66 Given that express constitutional mandate, it could be seen that the
Fundamental Law itself has weighed in on the balance to be struck between the
freedom of the press and the right to reply. Accordingly, one is not merely to see the
equation as purely between the press and the right to reply. Instead, the
constitutionally-mandated desiderata of free, orderly, honest, peaceful, and credible
elections would necessarily have to be factored in trying to see where the balance lies
between press and the demands of a right-to-reply.
Moreover, as already discussed by the Court in Telecommunications and Broadcast
Attorneys of the Philippines, Inc. v. Commission on Elections. 67
cralawred

In truth, radio and television broadcasting companies, which are given franchises, do
not own the airwaves and frequencies through which they transmit broadcast signals
and images. They are merely given the temporary privilege of using them. Since a
franchise is a mere privilege, the exercise of the privilege may reasonably be burdened
with the performance by the grantee of some form of public service. x x x 68
Relevant to this aspect are these passages from an American Supreme Court decision

with regard to broadcasting, right to reply requirements, and the limitations on

speech:
ChanRoblesVirtualawlibrary

We have long recognized that each medium of expression presents special First
Amendment problems. Joseph Burstyn, Inc. v. Wilson, 343 U.S. 495, 502-503, 96 L
Ed 1098, 72 S Ct 777. And of all forms of communication, it is broadcasting that
has received the most limited First Amendment protection. Thus, although other
speakers cannot be licensed except under laws that carefully define and narrow official
discretion, a broadcaster may be deprived of his license and his forum if the
Commission decides that such an action would serve the public interest, convenience,
and necessity. Similarly, although the First Amendment protects newspaper
publishers from being required to print the replies of those whom they
criticize, Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241, 41 L Ed 2d 730, 94 S
Ct 2831, it affords no such protection to broadcasters; on the contrary, they
must give free time to the victims of their criticism. Red Lion Broadcasting Co. v.
FCC, 395 U.S. 367, 23 L Ed 2d 371, 89 S Ct 1794.
The reasons for these distinctions are complex, but two have relevance to the present
case. First, the broadcast media have established a uniquely pervasive presence in the
lives of all Americans. Patently offensive, indecent material presented over the airwaves
confronts the citizen not only in public, but also in the privacy of the home, where the
individual's right to be left alone plainly outweighs the First Amendment rights of an
intruder. Rowan v. Post Office Dept., 397 U.S. 728, 25 L Ed 2d 736, 90 S Ct 1484.
Because the broadcast audience is constantly tuning in and out, prior warnings cannot
completely protect the listener or viewer from unexpected program content. To say that
one may avoid further offense by turning off the radio when he hears indecent language
is like saying that the remedy for an assault is to run away after the first blow. One may
hang up on an indecent phone call, but that option does not give the caller a
constitutional immunity or avoid a harm that has already taken place.
Second, broadcasting is uniquely accessible to children, even those too young to read.
Although Cohen's written message might have been incomprehensible to a first grader,
Pacifica's broadcast could have enlarged a child's vocabulary in an instant. Other forms
of offensive expression may be withheld from the young without restricting the
expression at its source. Bookstores and motion picture theaters, for example, may be
prohibited from making indecent material available to children. We held in Ginsberg v.
New York, 390 U.S. 629, that the government's interest in the well-being of its youth
and in supporting parents' claim to authority in their own household justified the
regulation of otherwise protected expression. The ease with which children may obtain
access to broadcast material, coupled with the concerns recognized in Ginsberg, amply
justify special treatment of indecent broadcasting.69
Given the foregoing considerations, the traditional notions of preferring speech and the
press over so many other values of society do not readily lend itself to this particular
matter. Instead, additional weight should be accorded on the constitutional directive to
afford a right to reply. If there was no such mandate, then the submissions of
petitioners may more easily commend themselves for this Courts acceptance. But as
noted above, this is not the case. Their arguments simplistically provide minimal
importance to that constitutional command to the point of marginalizing its importance
in the equation.

In fine, when it comes to election and the exercise of freedom of speech, of expression
and of the press, the latter must be properly viewed in context as being necessarily
made to accommodate the imperatives of fairness by giving teeth and substance to the
right to reply requirement.
WHEREFORE, premises considered, the petitions are PARTIALLY GRANTED, Section
9 (a) of Resolution No. 9615, as amended by Resolution No. 9631, is
declared UNCONSTITUTIONAL and, therefore, NULL and VOID. The constitutionality
of the remaining provisions of Resolution No. 9615, as amended by Resolution No.
9631, is upheld and remain in full force and effect.
In view of this Decision, the Temporary Restraining Order issued by the Court on April
16, 2013 is hereby made PERMANENT.
SO ORDERED.

cralawla w library