Professional Documents
Culture Documents
Case Notes/Digest
Luzon Development Bank v. Assoc of LDB
Issue
Whether or not the company has violated the
Collective Bargaining Agreement provision and the
Memorandum of Agreement dated April 1994, on
promotion.
At a conference, the parties agreed on the submission
of their respective Position Papers on December 115, 1994. Atty. Ester S. Garcia, in her capacity as
Voluntary Arbitrator, received ALDBE's Position
Paper on January 18, 1995. LDB, on the other hand,
failed to submit its Position Paper despite a letter
from the Voluntary Arbitrator reminding them to do
so. As of May 23, 1995 no Position Paper had been
filed by LDB. (The Arbitrator proceeded to rule on
the matter notwithstanding the absence of the
position paper of the petitioner.)
In labor law context, arbitration is the reference of a
labor dispute to an impartial third person for
determination on the basis of evidence and arguments
presented by such parties who have bound
themselves to accept the decision of the arbitrator as
final and binding. Compulsory arbitration is a system
whereby the parties to a dispute are compelled by
the government to forego their right to strike and are
compelled to accept the resolution of their dispute
through arbitration by a third party. Under voluntary
arbitration, on the other hand, referral of a dispute by
the parties is made, pursuant to a voluntary
arbitration clause in their collective agreement, to
an impartial third person for a final and binding
resolution.
Ideally, arbitration awards are supposed to be
complied with by both parties without delay, such
that once an award has been rendered by an
arbitrator, nothing is left to be done by both parties
but to comply with the same. After all, they are
presumed to have freely chosen arbitration as the
mode of settlement for that particular dispute.
Pursuant thereto, they have chosen a mutually
acceptable arbitrator who shall hear and decide their
case.
In the Philippine context, the parties to a Collective
Bargaining Agreement (CBA) are required to
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
FUNCTIONS ACTS IN A QUASI-JUDICIAL
CAPACITY." Under these rulings, it follows that the
voluntary arbitrator, whether acting solely or in a
panel, enjoys in law the status of a quasi-judicial
agency but independent of, and apart from, the
NLRC since his decisions are not appealable to the
latter.
An "instrumentality" is anything used as a means
or agency. 12 Thus, the terms governmental
"agency" or "instrumentality" are synonymous in the
sense that either of them is a means by which a
government acts, or by which a certain government
act or function is performed. 13 The word
"instrumentality," with respect to a state,
contemplates an authority to which the state
delegates
governmental
power
for
the
PERFORMANCE OF A STATE FUNCTION. 14
An individual person, like an administrator or
executor, is a judicial instrumentality in the settling of
an estate, 15 in the same manner that a sub-agent
appointed by a bankruptcy court is an instrumentality
of the court, 16 and a trustee in bankruptcy of a
defunct corporation is an instrumentality of the state.
The voluntary arbitrator no less performs a state
function pursuant to a governmental power
delegated to him under the provisions therefor in
the Labor Code and he falls, therefore, within the
contemplation of the term "instrumentality" in the
aforequoted Sec. 9 of B.P. 129. The fact that his
functions and powers are provided for in the Labor
Code does not place him within the exceptions to said
Sec. 9 since he is a quasi-judicial instrumentality as
contemplated therein.
A fortiori, the decision or award of the voluntary
arbitrator or panel of arbitrators should likewise be
appealable to the Court of Appeals, in line with the
procedure outlined in Revised Administrative
Circular No. 1-95, just like those of the quasi-judicial
agencies, boards and commissions enumerated
therein.
Iron & Steel Authority v. CA
Petitioner Iron and Steel Authority ("ISA") was
created by Presidential Decree (P.D.) No. 272 dated 9
August 1973 in order, generally, to develop and
promote the iron and steel industry in the Philippines.
P.D. No. 272 initially created petitioner ISA for a
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San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
case." 3 The trial court also referred to noncompliance by petitioner ISA with the requirements
of Section 16, Rule 3 of the Rules of Court.
Petitioner contended that despite the expiration of
its term, its juridical existence continued until the
winding up of its affairs could be completed. In the
alternative, petitioner ISA urged that the Republic of
the Philippines, being the real party-in-interest,
should be allowed to be substituted for petitioner
ISA. In this connection, ISA referred to a letter from
the Office of the President dated 28 September 1988
which especially directed the Solicitor General to
continue the expropriation case. (Which was denied
on the ground that the property to be expropriated is
not for public use of benefit but for the use and
benefit of NSC, which will engage in private business
and profit.)
Court of Appeals affirmed the order of dismissal of
the trial court. The Court of Appeals held that
petitioner ISA, "a government regulatory agency
exercising sovereign functions," did not have the
same rights as an ordinary corporation and that the
ISA, unlike corporations organized under the
Corporation Code, was not entitled to a period for
winding up its affairs after expiration of its legally
mandated term, with the result that upon expiration
of its term on 11 August 1987, ISA was "abolished
and [had] no more legal authority to perform
governmental functions." The Court of Appeals went
on to say that the action for expropriation could not
prosper because the basis for the proceedings, the
ISA's exercise of its delegated authority to
expropriate, had become ineffective as a result of
the delegate's dissolution, and could not be
continued in the name of Republic of the Philippines,
represented by the Solicitor General.
Issue
The principal issue which we must address in this
case is whether or not the Republic of the Philippines
is entitled to be substituted for ISA in view of the
expiration of ISA's term.
Ruling
Clearly, ISA was vested with some of the powers or
attributes normally associated with juridical
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
rule is, of course, that an action must be prosecuted
and defended in the name of the real party in interest.
(Rule 3, Section 2) Petitioner ISA was, at the
commencement of the expropriation proceedings, a
real party in interest, having been explicitly
authorized by its enabling statute to institute
expropriation proceedings. In the instant case, ISA
instituted the expropriation proceedings in its
capacity as an agent or delegate or representative of
the Republic of the Philippines pursuant to its
authority under P.D. No. 272. The present
expropriation suit was brought on behalf of and for
the benefit of the Republic as the principal of ISA.
From the foregoing premises, it follows that the
Republic of the Philippines is entitled to be
substituted in the expropriation proceedings as partyplaintiff in lieu of ISA, the statutory term of ISA
having expired. Put a little differently, the expiration
of ISA's statutory term did not by itself require or
justify the dismissal of the eminent domain
proceedings.
While the power of eminent domain is, in principle,
vested primarily in the legislative department of the
government, we believe and so hold that no new
legislative act is necessary should the Republic
decide, upon being substituted for ISA, in fact to
continue to prosecute the expropriation proceedings.
For the legislative authority, a long time ago, enacted
a continuing or standing delegation of authority to
the President of the Philippines to exercise, or
cause the exercise of, the power of eminent domain
on behalf of the Government of the Republic of the
Philippines. The 1917 Revised Administrative Code,
which was in effect at the time of the commencement
of the present expropriation proceedings before the
Iligan Regional Trial Court, provided that: In addition
to his general supervisory authority, the President of
the Philippines shall have such other specific
powers and duties as are expressly conferred or
imposed on him by law, and also, in particular, the
powers and duties set forth in this Chapter. To
determine when it is necessary or advantageous to
exercise the right of eminent domain in behalf of the
Government of the Philippines; and to direct the
Secretary of Justice, where such act is deemed
advisable, to cause the condemnation proceedings to
be begun in the court having proper jurisdiction.
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
does not change the principle. Where the special law
is later, it will be regarded as an exception to, or a
qualification of, the prior general act; and where the
general act is later, the special statute will be
construed as remaining an exception to its terms,
unless repealed expressly or by necessary
implication. It is obvious that the general law in this
case is BP No. 129 and PD No. 1344 the special law.
We do not read that provision as vesting concurrent
jurisdiction on the Regional Trial Court and the
Board over the complaint mentioned in PD No. 1344
if only because grants of power are not to be lightly
inferred or merely implied. The only purpose of this
section, as we see it, is to reserve. to the aggrieved
party such other remedies as may be provided by
existing law, like a prosecution for the act
complained of under the Revised Penal Code.
As a result of the growing complexity of the modern
society, it has become necessary to create more and
more administrative bodies to help in the regulation
of its ramified activities. Specialized in the particular
fields assigned to them, they can deal with the
problems thereof with more expertise and dispatch
than can be expected from the legislature or the
courts of justice. This is the reason for the increasing
vesture of quasi-legislative and quasi-judicial powers
in what is now not unreasonably called the fourth
department of the government. Statutes conferring
powers on their administrative agencies must be
liberally construed to enable them to discharge
their assigned duties in accordance with the
legislative purpose.
Dadubo v. Civil Service Commission
Petitioner Lolita A. Dadubo, Senior Accounts Analyst
and Rosario B. Cidro, Cash Supervisor, of the
Development Bank of the Philippines, Borongan
Branch were administratively charged with
conduct prejudicial to the best interest of the
service. 1 The charges were based on reports on the
unposted withdrawal of P60,000.00 (The withdrawal
occurred for at least 3 times.) from Savings Account
No. 87-692 in the name of Eric Tiu, Edgar Tiu, and/or
Pilar Tiu.
On the basis of these findings, DBP found Dadubo
guilty of dishonesty for embezzlement of bank
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
Required to comment, the Solicitor General argued
that CSC Resolution No. 92-878 did not need to
restate the legal and factual bases of the original
decision in CSC-MSPB No. 497 which already
explained the relevant facts and the applicable law.
The petitioner had admitted that she changed the
entry of the dates in the subsidiary ledger card from
August 13 to 14 in the course of her reconciliation
work although she was not authorized to do this. This
admission, along with the other evidence Presented
during the investigation in the bank, proved Dadubo's
guilt. Moreover, the affidavit of Albert C. Ballicud
was inadmissible in evidence because he was never
subjected to cross-examination.
Ruling
The petitioner's challenges are mainly factual. The
rule is that the findings of fact of administrative
bodies, if based on substantial evidence, are
controlling on the reviewing authority. 10 is settled
that it is not for the appellate court to substitute its
own judgment for that of the administrative agency
on the sufficiency of the evidence and the credibility
of the witnesses. 11 Administrative decisions on
matters within their jurisdiction are entitled to respect
and can only be set aside on proof of grave abuse of
discretion, fraud or error of law. 12 None of these
vices has been shown in this case.
The petitioner's invocation of due process is without
merit. Her complaint that she was not sufficiently
informed of the charges against her has no basis.
While the rules governing Judicial trials should be
observed as much as possible, their strict
observance is not indispensable in administrative
cases. 13 As this Court has held, "the standard of due
process that must be met in administrative tribunals
allows a certain latitude as long as the element of
fairness is not ignored."
The essence of due process is distilled in the
immortal cry of Themistocles to Eurybiades: "Strike,
but hear me first!" Less dramatically, it simply
connotes an opportunity to be heard. The petitioner
had several opportunities to be heard and to present
evidence that she was not guilty of embezzlement but
only of failure to comply with the tellering procedure.
Not only did she testify at her formal investigation
but she also filed a motion for reconsideration with
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
Agusan-Surigao as described in Section 1 of Art.
1693 of the Philippine Commission as indicated in
the green pencil in the attached sketch" of the areas
as prepared by the Bureau of Forestry.
The Director of Forestry ruled on the matter, by
holding that he claim of the Ago Timber Corporation
runs counter to the intentions of this Office is
granting the license of Mr. Narciso Lansang; and
further, that it also runs counter to the intentions of
this Office in granting the Timber License Agreement
to the Lianga Bay Logging Co., Inc. The intentions of
this Office in granting the two licenses (Lansang and
Lianga Bay Logging Co., Inc.) are patently manifest
in that distances and bearings are the controlling
factors. If mention was ever made of the AgusanSurigao boundary, as the common boundary line of
both licensees, this Office could not have meant the
Agusan-Surigao boundary as described under Section
1 of Act 1693 of the Philippine Commission for were
it so it could have been so easy for this Office to
mention the distance from point 3 to point 4 of
Narciso Lansang as approximately 13,800 meters.
This cannot be considered a mistake considering that
the percentage of error which is more or less 103%
is too high an error to be committed by an Office
manned by competent technical men. The AgusanSurigao boundary as mentioned in the technical
descriptions of both licensees, is, therefore, patently
an imaginary line based on B.F. License Control
Map. Such being the case, it is reiterated that distance
and bearings control the description where an
imaginary line exists. 3 The decision fixed the
common boundary of the licensed areas of the Ago
Timber Corporation and Lianga Bay Logging Co.,
Inc. as that indicated in red pencil of the sketch
attached to the decision.
In an appeal interposed by respondent Ago, docketed
in the Department of Agriculture and Natural
Resources as DANR Case No. 2268, the then Acting
Secretary of Agriculture and Natural Resources Jose
Y. Feliciano, in a decision dated August 9, 1965 set
aside the appealed decision of the Director of
Forestry and ruled that "(T)he common boundary line
of the licensed areas of the Ago Timber Corporation
and the Lianga Bay Logging Co., Inc., should be that
indicated by the green line on the same sketch which
had been made an integral part of the appealed
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
weigh the same in the light of the AUTHORITY
SPECIFICALLY VESTED in them by law. Such a
posture cannot be entertained, for it is a well-settled
doctrine that the courts of justice will generally not
interfere with purely administrative matters which
are addressed to the sound discretion of government
agencies and their expertise unless there is a clear
showing that the latter acted arbitrarily or with
grave abuse of discretion or when they have acted
in a capricious and whimsical manner such that their
action may amount to an excess or lack of
jurisdiction. A doctrine long recognized is that where
the law confines in an administrative office the power
to determine particular questions or matters, upon the
facts to be presented, the jurisdiction of such office
shall prevail over the courts.
The general rule, under the principles of
administrative law in force in this jurisdiction, is that
decisions of administrative officers shall not be
disturbed by the courts, except when the former
have acted without or in excess of their jurisdiction,
or with grave abuse of discretion. Findings of
administrative officials and agencies who have
acquired expertise because their jurisdiction is
confined to specific matters are generally accorded
not only respect but at times even finality of such
findings are supported by substantial evidence. 20
As recently stressed by the Court, "in this era of
clogged court dockets, the need for specialized
administrative boards or commissions with the
special knowledge, experience and capability to hear
and determine promptly disputes on technical matters
or essentially factual matters, subject to judicial
review in case of grave abuse of discretion, has
become well nigh indispensable."
It is elementary that a draft of a decision does not
operate as judgment on a case until the same is duly
signed and delivered to the clerk for filing and
promulgation. A decision cannot be considered as
binding on the parties until its promulgation. 23
Respondent should be aware of this rule. In still
another case of Ago v. Court of Appeals, 24 (where
herein respondent Ago was the petitioner) the Court
held that, "While it is to be presumed that the
judgment that was dictated in open court will be the
judgment of the court, the court may still modify said
order as the same is being put into writing. And even
Christian Arbiol
San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
Christian General Assembly v. Sps. Ignacio
Issue
We resolve in this Rule 45 petition the legal issue of
whether an action to rescind a contract to sell a
subdivision lot that the buyer found to be under
litigation falls under the exclusive jurisdiction of the
Housing and Land Use Regulatory Board (HLURB).
Facts
On April 30, 1998, CGA entered into a Contract to
Sell a subdivision lot 4 (subject property) with the
respondents the registered owners and developers
of a housing subdivision known as Villa Priscilla
Subdivision located in Barangay Cutcut, Pulilan,
Bulacan. Under the Contract to Sell, CGA would pay
P2,373,000.00 for the subject property on installment
basis; they were to pay a down payment of
P1,186,500, with the balance payable within three
years on equal monthly amortization payments of
P46,593.85, inclusive of interest at 24% per annum,
starting June 1998. On August 5, 2000, the parties
mutually agreed to amend the Contract to Sell to
extend the payment period from three to five years,
calculated from the date of purchase and based on the
increased total consideration of P2,706,600, with
equal monthly installments of P37,615.00, inclusive
of interest at 24% per annum, starting September
2000.
According to CGA, it religiously paid the monthly
installments until its administrative pastor
discovered that the title covering the subject
property suffered from fatal flaws and defects. CGA
learned that the subject property was actually part of
two consolidated lots (Lots 2-F and 2-G Bsd-04000829 [OLT]) that the respondents had acquired
from Nicanor Adriano (Adriano) and Ceferino
Sison (Sison), respectively. Adriano and Sison were
former tenant-beneficiaries of Purificacion S.
Imperial (Imperial) whose property in Cutcut,
Pulilan, Bulacan 5 had been placed under Presidential
Decree (PD)No.
27's
Operation
Land
Transfer. 6 According to CGA, Imperial applied for
the retention of five hectares of her land
under Republic Act No. 6657, 7 which the
Department of Agrarian Reform (DAR) granted in its
October 2, 1997 order (DAR Order). The DAR
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San Beda College Alabang School of Law
Administrative Law
Case Notes/Digest
action was commenced. The jurisdiction of the
tribunal over the subject matter or nature of an action
is conferred only by law, not by the parties' consent
or by their waiver in favor of a court that would
otherwise have no jurisdiction over the subject matter
or the nature of an action. PD No. 957, enacted on
July 12, 1976, was intended to closely supervise and
regulate the real estate subdivision and condominium
businesses in order to curb the growing number of
swindling and fraudulent manipulations perpetrated
by unscrupulous subdivision and condominium
sellers and operators.
Section 3 of PD No. 957 granted the National
Housing Authority (NHA) the "exclusive jurisdiction
to regulate the real estate trade and business".
Thereafter, PD No. 1344 was issued on April 2,
1978 to expand the jurisdiction of the NHA.
Executive Order No. 648 (EO 648), dated February 7,
1981, transferred the regulatory and quasi-judicial
functions of the NHA to the Human Settlements
Regulatory
Commission (HSRC).
Pursuant
to Executive Order No. 90 dated December 17, 1986,
the HSRC was renamed as the HLURB.
The surge in the real estate business in the country
brought with it an increasing number of cases
between subdivision owners/developers and lot
buyers on the issue of the extent of the HLURB's
exclusive jurisdiction. In the cases that reached us,
we have consistently ruled that the HLURB has
exclusive jurisdiction over complaints arising from
contracts between the subdivision developer and the
lot buyer or those aimed at compelling the
subdivision developer to comply with its contractual
and statutory obligations to make the subdivision a
better place to live in.
The provisions of PD 957 were intended to
encompass all questions regarding subdivisions
and condominiums. The intention was aimed at
providing for an appropriate government agency,
the HLURB, to which all parties aggrieved in the
implementation of provisions and the enforcement
of contractual rights with respect to said category of
real estate may take recourse. The business of
developing subdivisions and corporations being
imbued with public interest and welfare, any question
arising from the exercise of that prerogative should
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San Beda College Alabang School of Law
10
Administrative Law
Case Notes/Digest
longer a uniquely judicial function, exercisable
only by our regular courts.
The expansive grant of jurisdiction to the HLURB
does not mean, however, that all cases involving
subdivision lots automatically fall under its
jurisdiction. Note particularly pars. (b) and (c) as
worded, where the HLURB's jurisdiction concerns
cases commenced by subdivision lot or condominium
unit buyers. As to par. (a), concerning "unsound real
estate practices", it would appear that the logical
complainant WOULD BE THE BUYERS AND
CUSTOMERS
AGAINST
THE
SELLERS
(subdivision
owners
and
developers
or
condominium builders and realtors), and not vice
versa.
Pursuant to Roxas, we held in Pilar Development
Corporation
v.
Villar 19 and Suntay
v.
Gocolay 20 that the HLURB has no jurisdiction over
cases filed bysubdivision or condominium owners or
developers against subdivision lot or condominium
unit buyers or owners. The rationale behind this can
be found in the wordings of Sec. 1, PD No. 1344,
which expressly qualifies that the cases cognizable by
the HLURB are those instituted by subdivision or
condomium buyers or owners against the project
developer or owner. This is also in keeping with the
policy of the law, which is to curb unscrupulous
practices in the real estate trade and business. The
only instance that HLURB may take cognizance of a
case filed by the developer is when said case is
instituted as a compulsory counterclaim to a pending
case filed against it by the buyer or owner of a
subdivision lot or condominium unit.
From these allegations, the main thrust of the CGA
complaint is clear to compel the respondents to
refund the payments already made for the subject
property because the respondents were selling a
property that they apparently did not own. In other
words, CGA claims that since the respondents
cannot comply with their obligations under the
contract, i.e., to deliver the property free from all
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San Beda College Alabang School of Law
11