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On 14 February 1998, Congress passed the General Appropriations Act of 1998. It provided that the Constitutional Commissions
and Offices enjoying fiscal autonomy are authorized to formulate and implement the organizational structures of their respective
offices, to fix and determine the salaries, allowances, and other benefits of their personnel.

On the strength of these special provisions, the CHR(the Chairperson & 3 commissioners) promulgated a resolution adopting an
upgrading and reclassification scheme among selected positions in the Commission. Annexed to said resolution is the proposed
creation of ten additional plantilla positions.

On 19 October 1998, CHR issued another resolution providing for the upgrading or raising of salary grades of some positions in
the Commission. To support the implementation of such scheme, the CHR, in the same resolution, authorized the augmentation
of a commensurate amount generated from savings under Personnel Services.

By virtue of Resolution No. A98-062, the CHR "collapsed" the vacant positions in the body to provide additional source of funding
for said staffing modification. Among the positions collapsed were: one Attorney III, four Attorney IV, one Chemist III, three
Special Investigator I, one Clerk III, and one Accounting Clerk II.

The CHR forwarded said staffing modification and upgrading scheme to the DBM with a request for its approval, but the then
DBM secretary denied the request as the further upgrade would elevate the field units to a bureau or regional office, a level even
higher than the one previously denied.

In light of the DBM's disapproval of the proposed personnel modification scheme, the CSC-National Capital Region Office
recommended to the Central Office that the subject appointments be rejected owing to the DBM's disapproval of the plantilla

Meanwhile, the officers of petitioner CHREA, in representation of the rank and file employees of the CHR, requested the CSC-
Central Office to affirm the recommendation of the CSC-Regional Office. CHREA stood its ground in saying that the DBM is the
only agency with appropriate authority mandated by law to evaluate and approve matters of reclassification and upgrading, as
well as creation of positions.

The CSC-Central Office denied CHREA's request, and reversed the recommendation of the CSC-Regional Office that the upgrading
scheme be censured. The case was elevated to the CA.

The Court of Appeals affirmed the pronouncement of the CSC-Central Office and upheld the validity of the upgrading, retitling,
and reclassification scheme in the CHR on the justification that such action is within the ambit of CHR's fiscal autonomy.


The CSC and the Court of Appeals erroneously assumed that CHR enjoys fiscal autonomy insofar as financial matters are
concerned, particularly with regard to the upgrading and reclassification of positions therein


petitioner has no locus standi considering that there exists no official written record in the Commission recognizing petitioner as
a bona fide organization of its employees nor is there anything in the records to show that its president, Marcial A. Sanchez, Jr.,
has the authority to sue the CHR.


1. Whether CHREA has legal standing

2. Whether the CHR enjoys FISCAL AUTONOMY


1. Petitioner has locus standi. A proper party is one who has sustained or is in immediate danger of sustaining an injury as a result
of the act complained of. Here, petitioner, which consists of rank and file employees of respondent CHR, protests that the
upgrading and collapsing of positions benefited only a select few in the upper level positions in the Commission resulting to the
demoralization of the rank and file employees. This sufficiently meets the injury test. Indeed, the CHR's upgrading scheme, if
found to be valid, potentially entails eating up the Commission's savings or that portion of its budgetary pie otherwise allocated
for Personnel Services, from which the benefits of the employees, including those in the rank and file, are derived.

Further, the personality of petitioner to file this case was recognized by the CSC when it took cognizance of the CHREA's request
to affirm the recommendation of the CSC-National Capital Region Office. CHREA's personality to bring the suit was a non-issue in
the Court of Appeals when it passed upon the merits of this case. Thus, neither should our hands be tied by this technical concern.
Indeed, it is settled jurisprudence that an issue that was neither raised in the complaint nor in the court below cannot be raised
for the first time on appeal, as to do so would be offensive to the basic rules of fair play, justice, and due process.


CHR does not enjoy Fiscal Autonomy because it is not among the class of Constitutional Commissions. Article IX of the Constitution
states that only the CSC, the Commission on Elections, and the Commission on Audit shall be tagged as Constitutional
Commissions with the appurtenant right to fiscal autonomy.

In essence, fiscal autonomy entails freedom from outside control and limitations, other than those provided by law. It is the
freedom to allocate and utilize funds granted by law, in accordance with law.