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Francisco Silva as NEA Administrator Petitioner

VS. Leovigildo T. Mationg -Respondent

Facts:
Aklan Electronic Cooperative, Inc (AKELCO) is an electric cooperative under
supervision and control of the National Electrification Administration (NEA) pursuant to
Presidential Decree No. 269. The controversy started when National Power Corporation
(NAPOCOR) cut-off the electricity in Aklan from March 18-20, 2002 because AKELCO
failed to pay its 25-million-peso obligation.
Edita Bueno, NEA Officer-in-Charge and Deputy Admin for Cooperatives Development
and Special Projects, formed a team to take-over the management and operation
AKELCO resulting to the restoration of the power supply to the area. However,
respondent remained the general manager of AKELCO despite the NEA take-over.
The AKELCO Board of Directors (AKELCO BOD) received a complaint from the
different municipal mayors seeking to dismiss respondent as AKELCO general manager
for gross incompetence and mismanagement. Consumer-members of AKELCO also
expressed their dissatisfaction and frustration over the inefficiency of AKELCOs
management.
The Board of Directors now issued Resolution No. 18 suspending the respondent to
prevent him from exerting undue influence while the audit and investigation were being
conducted by the NEA management team.
Bueno agreed with the BOD but reduced the suspension to 30 days.
An intra-corporate dispute erupted as the NEA received resolution 17 that disowns and
recall the Board Resolution No. 18. It seems that the dispute involved two factions of the
Board of Directors the Peralta faction and the Rentillo faction because of this Bueno
revoked the approval of Resolution No. 18 and passed the case to the NEA Board of
Administrators (NEA-BOA). The two factions submitted their respective position papers.
A committee was made for the evaluation of the position papers. The committee
recommended the approval of Resolution 18 and disapproval of Resolution 17. The
petitioner now then approved the recommendation and NEA-BOA issued resolution 22
authorizing petitioner to remove respondent from his position pursuant to Section 5(e) of
PD 269 as amended by PD 1645.
On May 2, 2002, respondent filed a petition to enjoin petitioner from enforcing the
resolution and the April 19, 2002 order
While the petition was pending, the BOD issued Board Resolution No. 32 which was
made to investigate the complaints against the respondents.
The NEA-BOA also made its move and approved of the petitioners order and
resolution.
The BOD terminated its investigation and issued Resolution No. 2 finding the
respondent guilty of willful breach of trust and confidence to the consumer-members
ang habitual neglect of his duties and terminated the respondents services. The
petitioner approved Resolution No. 2.
On the other hand, the respondent filed a Manifestation and Supplementary Motion with
the CA assailing his removal and praying for the nullification of petitioners issuances
and for reinstatement.
The NEA-BOA supported the petitioner by issuing Resolution No. 37 which confirms the
petitioners approval of Resolution No. 2.
DECISION OF THE COURT OF APPEALS
The Court of Appeals nullifying the petitioners order and resolution because It is the
Board of Administrator and not the Administrator himself who is empowered to suspend
and/or terminate the incumbent general manager and appoint an acting general
manager of an erring electric cooperative.
As to whether or not the Board of Administrators may validly delegate the foregoing
power to the NEA Administrator. The held that it cannot because to sanction this
delegation would violate the maxim: potestasdelegata non delegari potest (what has
been delegated cannot be delegated)
The petitioner now then elevated the case to the Supreme Court.
Issue:
Whether the NEA-BOAs administration for and confirmation of respondents suspension
and removal as AKELCO general manager by petitioner as then NEA Administrator are
legal.
Held:
Yes. The Supreme Court stated that the NEA Board of Administrators handles
disciplinary measures as provided in Section 10(e) and there was no undue delegation
of power by the NEA-BOA to the NEA Administrator because Resolution No 22 provides
that NEA Administrator is subject to the confirmation of the NEA-BOA. What is
delegated to the NEA Administrator is only the power to investigate and to make a
recommendation, not the power to discipline and this is provided in Section 5(b)(7) of
PD 269 which states that:
(7) To exercise such other powers and duties as may be vested in him by the
Board of Administrators.
The Court also note that the petitioner did not assail the resolution and orders on his
own impulse (motu proprio) because it is the BOD who initiated the suspension and
termination of respondent through their resolutions and the petitioner merely approved
it. This procedure is supported by Section 24(a) of PD 269 which basically states that
the management of the cooperative is handled by the Board of Directors under the
supervision and control of NEA which shall have the right to approve all policies and
resolutions.