[G.R. NO.

169777* : April 20, 2006]

SENATE OF THE PHILIPPINES, represented by FRANKLIN M. DRILON, in his

capacity as Senate President, JUAN M. FLAVIER, in his capacity as Senate President Pro
Tempore, FRANCIS N. PANGILINAN, in his capacity as Majority Leader, AQUILINO Q.
PIMENTEL, JR., in his capacity as Minority Leader, SENATORS RODOLFO G.
BIAZON, "COMPANERA" PIA S. CAYETANO, JINGGOY EJERCITO ESTRADA,
LUISA "LOI" EJERCITO ESTRADA, JUAN PONCE ENRILE, RICHARD J. GORDON,
PANFILO M. LACSON, ALFREDO S.LIM, M. A. MADRIGAL, SERGIO OSMENA III,
RALPH G. RECTO, and MAR ROXAS, Petitioners, v. EDUARDO R. ERMITA, in his
capacity as Executive Secretary and alter-ego of President Gloria Macapagal-Arroyo, and
anyone acting in his stead and in behalf of the President of the Philippines, Respondents.

DECISION

CARPIO MORALES, J.:

A transparent government is one of the hallmarks of a truly republican state. Even in the early
history of republican thought, however, it has been recognized that the head of government may
keep certain information confidential in pursuit of the public interest. Explaining the reason for
vesting executive power in only one magistrate, a distinguished delegate to the U.S.
Constitutional Convention said: "Decision, activity, secrecy, and dispatch will generally
characterize the proceedings of one man, in a much more eminent degree than the proceedings of
any greater number; and in proportion as the number is increased, these qualities will be
diminished."1

History has been witness, however, to the fact that the power to withhold information lends itself
to abuse, hence, the necessity to guard it zealously.

The present consolidated petitions for certiorari and prohibition proffer that the President has
abused such power by issuing Executive Order No. 464 (E.O. 464) last September 28, 2005.
They thus pray for its declaration as null and void for being unconstitutional.

In resolving the controversy, this Court shall proceed with the recognition that the issuance under
review has come from a co-equal branch of government, which thus entitles it to a strong
presumption of constitutionality. Once the challenged order is found to be indeed violative of the
Constitution, it is duty-bound to declare it so. For the Constitution, being the highest expression
of the sovereign will of the Filipino people, must prevail over any issuance of the government
that contravenes its mandates.

In the exercise of its legislative power, the Senate of the Philippines, through its various Senate
Committees, conducts inquiries or investigations in aid of legislation which call for, inter alia,
the attendance of officials and employees of the executive department, bureaus, and offices
including those employed in Government Owned and Controlled Corporations, the Armed
Forces of the Philippines (AFP), and the Philippine National Police (PNP).
On September 21 to 23, 2005, the Committee of the Senate as a whole issued invitations to
various officials of the Executive Department for them to appear on September 29, 2005 as
resource speakers in a public hearing on the railway project of the North Luzon Railways
Corporation with the China National Machinery and Equipment Group (hereinafter North Rail
Project). The public hearing was sparked by a privilege speech of Senator Juan Ponce Enrile
urging the Senate to investigate the alleged overpricing and other unlawful provisions of the
contract covering the North Rail Project.

The Senate Committee on National Defense and Security likewise issued invitations 2 dated
September 22, 2005 to the following officials of the AFP: the Commanding General of the
Philippine Army, Lt. Gen. Hermogenes C. Esperon; Inspector General of the AFP Vice Admiral
Mateo M. Mayuga; Deputy Chief of Staff for Intelligence of the AFP Rear Admiral Tirso R.
Danga; Chief of the Intelligence Service of the AFP Brig. Gen. Marlu Q. Quevedo; Assistant
Superintendent of the Philippine Military Academy (PMA) Brig. Gen. Francisco V. Gudani; and
Assistant Commandant, Corps of Cadets of the PMA, Col. Alexander F. Balutan, for them to
attend as resource persons in a public hearing scheduled on September 28, 2005 on the
following: (1) Privilege Speech of Senator Aquilino Q. Pimentel Jr., delivered on June 6, 2005
entitled "Bunye has Provided Smoking Gun or has Opened a Can of Worms that Show Massive
Electoral Fraud in the Presidential Election of May 2005"; (2) Privilege Speech of Senator
Jinggoy E. Estrada delivered on July 26, 2005 entitled "The Philippines as the Wire-Tapping
Capital of the World"; (3) Privilege Speech of Senator Rodolfo Biazon delivered on August 1,
2005 entitled "Clear and Present Danger"; (4) Senate Resolution No. 285 filed by Senator Maria
Ana Consuelo Madrigal - Resolution Directing the Committee on National Defense and Security
to Conduct an Inquiry, in Aid of Legislation, and in the National Interest, on the Role of the
Military in the So-called "Gloriagate Scandal"; and (5) Senate Resolution No. 295 filed by
Senator Biazon - Resolution Directing the Committee on National Defense and Security to
Conduct an Inquiry, in Aid of Legislation, on the Wire-Tapping of the President of the
Philippines.

Also invited to the above-said hearing scheduled on September 28 2005 was the AFP Chief of
Staff, General Generoso S. Senga who, by letter3 dated September 27, 2005, requested for its
postponement "due to a pressing operational situation that demands [his utmost personal
attention" while "some of the invited AFP officers are currently attending to other urgent
operational matters."

On September 28, 2005, Senate President Franklin M. Drilon received from Executive Secretary
Eduardo R. Ermita a letter4 dated September 27, 2005 "respectfully request[ing] for the
postponement of the hearing [regarding the NorthRail project] to which various officials of the
Executive Department have been invited" in order to "afford said officials ample time and
opportunity to study and prepare for the various issues so that they may better enlighten the
Senate Committee on its investigation."

Senate President Drilon, however, wrote5 Executive Secretary Ermita that the Senators "are
unable to accede to [his request]" as it "was sent belatedly" and "[a]ll preparations and
arrangements as well as notices to all resource persons were completed [the previous] week."
Senate President Drilon likewise received on September 28, 2005 a letter6 from the President of
the North Luzon Railways Corporation Jose L. Cortes, Jr. requesting that the hearing on the
NorthRail project be postponed or cancelled until a copy of the report of the UP Law Center on
the contract agreements relative to the project had been secured.

On September 28, 2005, the President issued E.O. 464, "Ensuring Observance of the Principle of
Separation of Powers, Adherence to the Rule on Executive Privilege and Respect for the Rights
of Public Officials Appearing in Legislative Inquiries in Aid of Legislation Under the
Constitution, and For Other Purposes,"7 which, pursuant to Section 6 thereof, took effect
immediately. The salient provisions of the Order are as follows:

SECTION 1. Appearance by Heads of Departments Before Congress. - In accordance with

Article VI, Section 22 of the Constitution and to implement the Constitutional provisions on the
separation of powers between co-equal branches of the government, all heads of departments of
the Executive Branch of the government shall secure the consent of the President prior to
appearing before either House of Congress.

When the security of the State or the public interest so requires and the President so states in
writing, the appearance shall only be conducted in executive session.

SECTION. 2. Nature, Scope and Coverage of Executive Privilege.'

(a) Nature and Scope. - The rule of confidentiality based on executive privilege is fundamental to
the operation of government and rooted in the separation of powers under the Constitution
(Almonte v. Vasquez, G.R. No. 95367, 23 May 1995). Further, Republic Act No. 6713 or the
Code of Conduct and Ethical Standards for Public Officials and Employees provides that Public
Officials and Employees shall not use or divulge confidential or classified information officially
known to them by reason of their office and not made available to the public to prejudice the
public interest.

Executive privilege covers all confidential or classified information between the President and
the public officers covered by this executive order, including:

Conversations and correspondence between the President and the public official covered by this
executive order (Almonte v. Vasquez G.R. No. 95367, 23 May 1995; Chavez v. Public Estates
Authority, G.R. No. 133250, 9 July 2002);

Military, diplomatic and other national security matters which in the interest of national security
should not be divulged (Almonte v. Vasquez, G.R. No. 95367, 23 May 1995; Chavez v.
Presidential Commission on Good Government, G.R. No. 130716, 9 December 1998).

Information between inter-government agencies prior to the conclusion of treaties and executive
agreements (Chavez v. Presidential Commission on Good Government, G.R. No. 130716, 9
December 1998);
Discussion in close-door Cabinet meetings (Chavez v. Presidential Commission on Good
Government, G.R. No. 130716, 9 December 1998);

Matters affecting national security and public order (Chavez v. Public Estates Authority, G.R.
No. 133250, 9 July 2002).

(b) Who are covered. - The following are covered by this executive order:

Senior officials of executive departments who in the judgment of the department heads are
covered by the executive privilege;

Generals and flag officers of the Armed Forces of the Philippines and such other officers who in
the judgment of the Chief of Staff are covered by the executive privilege;

Philippine National Police (PNP) officers with rank of chief superintendent or higher and such
other officers who in the judgment of the Chief of the PNP are covered by the executive
privilege;

Senior national security officials who in the judgment of the National Security Adviser are
covered by the executive privilege; and cralawlibrary

Such other officers as may be determined by the President.

SECTION 3. Appearance of Other Public Officials Before Congress. - All public officials
enumerated in Section 2 (b) hereof shall secure prior consent of the President prior to appearing
before either House of Congress to ensure the observance of the principle of separation of
powers, adherence to the rule on executive privilege and respect for the rights of public officials
appearing in inquiries in aid of legislation. (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

Also on September 28, 2005, Senate President Drilon received from Executive Secretary Ermita
a copy of E.O. 464, and another letter8 informing him "that officials of the Executive Department
invited to appear at the meeting [regarding the NorthRail project] will not be able to attend the
same without the consent of the President, pursuant to [E.O. 464]" and that "said officials have
not secured the required consent from the President." On even date which was also the scheduled
date of the hearing on the alleged wiretapping, Gen. Senga sent a letter9 to Senator Biazon,
Chairperson of the Committee on National Defense and Security, informing him "that per
instruction of [President Arroyo], thru the Secretary of National Defense, no officer of the [AFP]
is authorized to appear before any Senate or Congressional hearings without seeking a written
approval from the President" and "that no approval has been granted by the President to any AFP
officer to appear before the public hearing of the Senate Committee on National Defense and
Security scheduled [on] 28 September 2005."

Despite the communications received from Executive Secretary Ermita and Gen. Senga, the
investigation scheduled by the Committee on National Defense and Security pushed through,
with only Col. Balutan and Brig. Gen. Gudani among all the AFP officials invited attending.
For defying President Arroyo's order barring military personnel from testifying before legislative
inquiries without her approval, Brig. Gen. Gudani and Col. Balutan were relieved from their
military posts and were made to face court martial proceedings.

As to the NorthRail project hearing scheduled on September 29, 2005, Executive Secretary
Ermita, citing E.O. 464, sent letter of regrets, in response to the invitations sent to the following
government officials: Light Railway Transit Authority Administrator Melquiades Robles, Metro
Rail Transit Authority Administrator Roberto Lastimoso, Department of Justice (DOJ) Chief
State Counsel Ricardo V. Perez, then Presidential Legal Counsel Merceditas Gutierrez,
Department of Transportation and Communication (DOTC) Undersecretary Guiling
Mamonding, DOTC Secretary Leandro Mendoza, Philippine National Railways General
Manager Jose Serase II, Monetary Board Member Juanita Amatong, Bases Conversion
Development Authority Chairperson Gen. Narciso Abaya and Secretary Romulo L. Neri.10
NorthRail President Cortes sent personal regrets likewise citing E.O. 464.11

On October 11, 2005, Petitioner Senate of the Philippines, alleging that it has a vital interest in the
resolution of the issue of the validity of E.O. 464 for it stands to suffer imminent and material injury, as it
has already sustained the same with its continued enforcement since it directly interferes with and
impedes the valid exercise of the Senate's powers and functions and conceals information of great
public interest and concern, filed its petition for certiorari and prohibition, docketed as G.R. No. 169777
and prays that E.O. 464 be declared unconstitutional.

Petitioners in G.R. No. 16966023 and G.R. No. 16977724 filed their memoranda on March 7, 2006, while
those in G.R. No. 16966725 and G.R. No. 16983426 filed theirs the next day or on March 8, 2006.
Petitioners in G.R. No. 171246 did not file any memorandum.

Petitioners submit that E.O. 464 violates the following constitutional provisions:

Art. VI, Sec. 2130

Art. VI, Sec. 2231

Art. VI, Sec. 132

Art. XI, Sec. 133

Art. III, Sec. 734

Art. III, Sec. 435

Art. XIII, Sec. 16 36

Art. II, Sec. 2837

Respondents Executive Secretary Ermita et al., on the other hand, pray in their consolidated
memorandum38 on March 13, 2006 for the dismissal of the petitions for lack of merit.
The Court synthesizes the issues to be resolved as follows:

1. Whether E.O. 464 contravenes the power of inquiry vested in Congress;

2. Whether E.O. 464 violates the right of the people to information on matters of public concern;
andcralawlibrary

3. Whether respondents have committed grave abuse of discretion when they implemented E.O.
464 prior to its publication in a newspaper of general circulation.

Essential requisites for judicial review

Before proceeding to resolve the issue of the constitutionality of E.O. 464, ascertainment of
whether the requisites for a valid exercise of the Court's power of judicial review are present is in
order.

Like almost all powers conferred by the Constitution, the power of judicial review is subject to
limitations, to wit: (1) there must be an actual case or controversy calling for the exercise of
judicial power; (2) the person challenging the act must have standing to challenge the validity of
the subject act or issuance; otherwise stated, he must have a personal and substantial interest in
the case such that he has sustained, or will sustain, direct injury as a result of its enforcement; (3)
the question of constitutionality must be raised at the earliest opportunity; and (4) the issue of
constitutionality must be the very lis mota of the case.39

Except with respect to the requisites of standing and existence of an actual case or controversy
where the disagreement between the parties lies, discussion of the rest of the requisites shall be
omitted.

Standing

Respondents, through the Solicitor General, assert that the allegations in G.R. NOS. 169659,
169660 and 169667 make it clear that they, adverting to the non-appearance of several officials
of the executive department in the investigations called by the different committees of the
Senate, were brought to vindicate the constitutional duty of the Senate or its different committees
to conduct inquiry in aid of legislation or in the exercise of its oversight functions. They maintain
that Representatives Ocampo et al. have not shown any specific prerogative, power, and
privilege of the House of Representatives which had been effectively impaired by E.O. 464,
there being no mention of any investigation called by the House of Representatives or any of its
committees which was aborted due to the implementation of E.O. 464.

As for Bayan Muna's alleged interest as a party-list representing the marginalized and
underrepresented, and that of the other petitioner groups and individuals who profess to have
standing as advocates and defenders of the Constitution, respondents contend that such interest
falls short of that required to confer standing on them as parties "injured-in-fact."40
Respecting petitioner Chavez, respondents contend that Chavez may not claim an interest as a
taxpayer for the implementation of E.O. 464 does not involve the exercise of taxing or spending
power.41

With regard to the petition filed by the Senate, respondents argue that in the absence of a
personal or direct injury by reason of the issuance of E.O. 464, the Senate and its individual
members are not the proper parties to assail the constitutionality of E.O. 464.

Invoking this Court's ruling in National Economic Protectionism Association v. Ongpin42 and
Valmonte v. Philippine Charity Sweepstakes Office,43 respondents assert that to be considered a
proper party, one must have a personal and substantial interest in the case, such that he has
sustained or will sustain direct injury due to the enforcement of E.O. 464.44

That the Senate of the Philippines has a fundamental right essential not only for intelligent public
decision-making in a democratic system, but more especially for sound legislation45 is not
disputed. E.O. 464, however, allegedly stifles the ability of the members of Congress to access
information that is crucial to law-making.46 Verily, the Senate, including its individual members,
has a substantial and direct interest over the outcome of the controversy and is the proper party to
assail the constitutionality of E.O. 464. Indeed, legislators have standing to maintain inviolate the
prerogative, powers and privileges vested by the Constitution in their office and are allowed to
sue to question the validity of any official action which they claim infringes their prerogatives as
legislators.47

In the same vein, party-list representatives Satur Ocampo (Bayan Muna), Teodoro Casino
(Bayan Muna), Joel Virador (Bayan Muna), Crispin Beltran (Anakpawis), Rafael Mariano
(Anakpawis), and Liza Maza (Gabriela) are allowed to sue to question the constitutionality of
E.O. 464, the absence of any claim that an investigation called by the House of Representatives
or any of its committees was aborted due to the implementation of E.O. 464 notwithstanding, it
being sufficient that a claim is made that E.O. 464 infringes on their constitutional rights and
duties as members of Congress to conduct investigation in aid of legislation and conduct
oversight functions in the implementation of laws.

The national political party, Bayan Muna, likewise meets the standing requirement as it obtained
three seats in the House of Representatives in the 2004 elections and is, therefore, entitled to
participate in the legislative process consonant with the declared policy underlying the party list
system of affording citizens belonging to marginalized and underrepresented sectors,
organizations and parties who lack well-defined political constituencies to contribute to the
formulation and enactment of legislation that will benefit the nation.48

As Bayan Muna and Representatives Ocampo et al. have the standing to file their petitions,
passing on the standing of their co-petitioners Courage and Codal is rendered unnecessary.49

In filing their respective petitions, Chavez, the ALG which claims to be an organization of
citizens, and the incumbent members of the IBP Board of Governors and the IBP in behalf of its
lawyer members,50 invoke their constitutional right to information on matters of public concern,
asserting that the right to information, curtailed and violated by E.O. 464, is essential to the
effective exercise of other constitutional rights51 and to the maintenance of the balance of power
among the three branches of the government through the principle of checks and balances.52

It is well-settled that when suing as a citizen, the interest of the petitioner in assailing the
constitutionality of laws, presidential decrees, orders, and other regulations, must be direct and
personal. In Franciso v. House of Representatives,53 this Court held that when the proceeding
involves the assertion of a public right, the mere fact that he is a citizen satisfies the requirement
of personal interest.

As for petitioner PDP-Laban, it asseverates that it is clothed with legal standing in view of the
transcendental issues raised in its petition which this Court needs to resolve in order to avert a
constitutional crisis. For it to be accorded standing on the ground of transcendental importance,
however, it must establish (1) the character of the funds (that it is public) or other assets involved
in the case, (2) the presence of a clear case of disregard of a constitutional or statutory
prohibition by the public respondent agency or instrumentality of the government, and (3) the
lack of any party with a more direct and specific interest in raising the questions being raised.54
The first and last determinants not being present as no public funds or assets are involved and
petitioners in G.R. NOS. 169777 and 169659 have direct and specific interests in the resolution
of the controversy, petitioner PDP-Laban is bereft of standing to file its petition. Its allegation
that E.O. 464 hampers its legislative agenda is vague and uncertain, and at best is only a
"generalized interest" which it shares with the rest of the political parties. Concrete injury,
whether actual or threatened, is that indispensable element of a dispute which serves in part to
cast it in a form traditionally capable of judicial resolution.55 In fine, PDP-Laban's alleged
interest as a political party does not suffice to clothe it with legal standing.

Actual Case or Controversy

Petitioners assert that an actual case exists, they citing the absence of the executive officials
invited by the Senate to its hearings after the issuance of E.O. 464, particularly those on the
NorthRail project and the wiretapping controversy.

Respondents counter that there is no case or controversy, there being no showing that President
Arroyo has actually withheld her consent or prohibited the appearance of the invited officials.56
These officials, they claim, merely communicated to the Senate that they have not yet secured
the consent of the President, not that the President prohibited their attendance.57 Specifically with
regard to the AFP officers who did not attend the hearing on September 28, 2005, respondents
claim that the instruction not to attend without the President's consent was based on its role as
Commander-in-Chief of the Armed Forces, not on E.O. 464.

Respondents thus conclude that the petitions merely rest on an unfounded apprehension that the
President will abuse its power of preventing the appearance of officials before Congress, and that
such apprehension is not sufficient for challenging the validity of E.O. 464.

The Court finds respondents' assertion that the President has not withheld her consent or
prohibited the appearance of the officials concerned immaterial in determining the existence of
an actual case or controversy insofar as E.O. 464 is concerned. For E.O. 464 does not require
either a deliberate withholding of consent or an express prohibition issuing from the President in
order to bar officials from appearing before Congress.

As the implementation of the challenged order has already resulted in the absence of officials
invited to the hearings of petitioner Senate of the Philippines, it would make no sense to wait for
any further event before considering the present case ripe for adjudication. Indeed, it would be
sheer abandonment of duty if this Court would now refrain from passing on the constitutionality
of E.O. 464.

Constitutionality of E.O. 464

E.O. 464, to the extent that it bars the appearance of executive officials before Congress,
deprives Congress of the information in the possession of these officials. To resolve the question
of whether such withholding of information violates the Constitution, consideration of the
general power of Congress to obtain information, otherwise known as the power of inquiry, is in
order.

The power of inquiry

The Congress power of inquiry is expressly recognized in Section 21 of Article VI of the

Constitution which reads:

SECTION 21. The Senate or the House of Representatives or any of its respective committees
may conduct inquiries in aid of legislation in accordance with its duly published rules of
procedure. The rights of persons appearing in or affected by such inquiries shall be respected.
(Underscoring supplied) ςrαlαωlιbrαrÿ

This provision is worded exactly as Section 8 of Article VIII of the 1973 Constitution except
that, in the latter, it vests the power of inquiry in the unicameral legislature established therein -
the Batasang Pambansa - and its committees.

The 1935 Constitution did not contain a similar provision. Nonetheless, in Arnault v. Nazareno,58
a case decided in 1950 under that Constitution, the Court already recognized that the power of
inquiry is inherent in the power to legislate.

Arnault involved a Senate investigation of the reportedly anomalous purchase of the Buenavista
and Tambobong Estates by the Rural Progress Administration. Arnault, who was considered a
leading witness in the controversy, was called to testify thereon by the Senate. On account of his
refusal to answer the questions of the senators on an important point, he was, by resolution of the
Senate, detained for contempt. Upholding the Senate's power to punish Arnault for contempt,
this Court held:

Although there is no provision in the Constitution expressly investing either House of Congress
with power to make investigations and exact testimony to the end that it may exercise its
legislative functions advisedly and effectively, such power is so far incidental to the legislative
function as to be implied. In other words, the power of inquiry - with process to enforce it - is an
essential and appropriate auxiliary to the legislative function. A legislative body cannot legislate
wisely or effectively in the absence of information respecting the conditions which the
legislation is intended to affect or change; and where the legislative body does not itself possess
the requisite information - which is not infrequently true - recourse must be had to others who do
possess it. Experience has shown that mere requests for such information are often unavailing,
and also that information which is volunteered is not always accurate or complete; so some
means of compulsion is essential to obtain what is needed.59 . . . (Emphasis and underscoring
supplied)ςrαlαωlιbrαrÿ

That this power of inquiry is broad enough to cover officials of the executive branch may be
deduced from the same case. The power of inquiry, the Court therein ruled, is co-extensive with
the power to legislate.60 The matters which may be a proper subject of legislation and those
which may be a proper subject of investigation are one. It follows that the operation of
government, being a legitimate subject for legislation, is a proper subject for investigation.

Thus, the Court found that the Senate investigation of the government transaction involved in
Arnault was a proper exercise of the power of inquiry. Besides being related to the expenditure
of public funds of which Congress is the guardian, the transaction, the Court held, "also involved
government agencies created by Congress and officers whose positions it is within the power of
Congress to regulate or even abolish."

Since Congress has authority to inquire into the operations of the executive branch, it would be
incongruous to hold that the power of inquiry does not extend to executive officials who are the
most familiar with and informed on executive operations.

As discussed in Arnault, the power of inquiry, "with process to enforce it," is grounded on the
necessity of information in the legislative process. If the information possessed by executive
officials on the operation of their offices is necessary for wise legislation on that subject, by
parity of reasoning, Congress has the right to that information and the power to compel the
disclosure thereof.

As evidenced by the American experience during the so-called "McCarthy era," however, the
right of Congress to conduct inquiries in aid of legislation is, in theory, no less susceptible to
abuse than executive or judicial power. It may thus be subjected to judicial review pursuant to
the Court's certiorari powers under Section 1, Article VIII of the Constitution.

For one, as noted in Bengzon v. Senate Blue Ribbon Committee,61 the inquiry itself might not
properly be in aid of legislation, and thus beyond the constitutional power of Congress. Such
inquiry could not usurp judicial functions. Parenthetically, one possible way for Congress to
avoid such a result as occurred in Bengzon is to indicate in its invitations to the public officials
concerned, or to any person for that matter, the possible needed statute which prompted the need
for the inquiry. Given such statement in its invitations, along with the usual indication of the
subject of inquiry and the questions relative to and in furtherance thereof, there would be less
room for speculation on the part of the person invited on whether the inquiry is in aid of
legislation.
Section 21, Article VI likewise establishes crucial safeguards that proscribe the legislative power
of inquiry. The provision requires that the inquiry be done in accordance with the Senate or
House's duly published rules of procedure, necessarily implying the constitutional infirmity of an
inquiry conducted without duly published rules of procedure. Section 21 also mandates that the
rights of persons appearing in or affected by such inquiries be respected, an imposition that
obligates Congress to adhere to the guarantees in the Bill of Rights.

These abuses are, of course, remediable before the courts, upon the proper suit filed by the
persons affected, even if they belong to the executive branch. Nonetheless, there may be
exceptional circumstances, none appearing to obtain at present, wherein a clear pattern of abuse
of the legislative power of inquiry might be established, resulting in palpable violations of the
rights guaranteed to members of the executive department under the Bill of Rights. In such
instances, depending on the particulars of each case, attempts by the Executive Branch to
forestall these abuses may be accorded judicial sanction.

Even where the inquiry is in aid of legislation, there are still recognized exemptions to the power
of inquiry, which exemptions fall under the rubric of "executive privilege." Since this term
figures prominently in the challenged order, it being mentioned in its provisions, its preambular
clauses,62 and in its very title, a discussion of executive privilege is crucial for determining the
constitutionality of E.O. 464.

Executive privilege

The phrase "executive privilege" is not new in this jurisdiction. It has been used even prior to the
promulgation of the 1986 Constitution.63 Being of American origin, it is best understood in light
of how it has been defined and used in the legal literature of the United States.

Schwartz defines executive privilege as "the power of the Government to withhold information
from the public, the courts, and the Congress."64 Similarly, Rozell defines it as "the right of the
President and high-level executive branch officers to withhold information from Congress, the
courts, and ultimately the public."65

Executive privilege is, nonetheless, not a clear or unitary concept.66 It has encompassed claims of
varying kinds.67 Tribe, in fact, comments that while it is customary to employ the phrase
"executive privilege," it may be more accurate to speak of executive privileges "since
presidential refusals to furnish information may be actuated by any of at least three distinct kinds
of considerations, and may be asserted, with differing degrees of success, in the context of either
judicial or legislative investigations."

One variety of the privilege, Tribe explains, is the state secrets privilege invoked by U.S.
Presidents, beginning with Washington, on the ground that the information is of such nature that
its disclosure would subvert crucial military or diplomatic objectives. Another variety is the
informer's privilege, or the privilege of the Government not to disclose the identity of persons
who furnish information of violations of law to officers charged with the enforcement of that
law. Finally, a generic privilege for internal deliberations has been said to attach to
intragovernmental documents reflecting advisory opinions, recommendations and deliberations
comprising part of a process by which governmental decisions and policies are formulated.68

Tribe's comment is supported by the ruling in In re Sealed Case, thus:

Since the beginnings of our nation, executive officials have claimed a variety of privileges to
resist disclosure of information the confidentiality of which they felt was crucial to fulfillment of
the unique role and responsibilities of the executive branch of our government. Courts ruled
early that the executive had a right to withhold documents that might reveal military or state
secrets. The courts have also granted the executive a right to withhold the identity of government
informers in some circumstances and a qualified right to withhold information related to pending
investigations. x x x"69 (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

The entry in Black's Law Dictionary on "executive privilege" is similarly instructive regarding
the scope of the doctrine.

This privilege, based on the constitutional doctrine of separation of powers, exempts the
executive from disclosure requirements applicable to the ordinary citizen or organization where
such exemption is necessary to the discharge of highly important executive responsibilities
involved in maintaining governmental operations, and extends not only to military and
diplomatic secrets but also to documents integral to an appropriate exercise of the executive'
domestic decisional and policy making functions, that is, those documents reflecting the frank
expression necessary in intra-governmental advisory and deliberative communications.70
(Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

That a type of information is recognized as privileged does not, however, necessarily mean that it
would be considered privileged in all instances. For in determining the validity of a claim of
privilege, the question that must be asked is not only whether the requested information falls
within one of the traditional privileges, but also whether that privilege should be honored in a
given procedural setting.71

The leading case on executive privilege in the United States is U.S. v. Nixon, 72 decided in 1974.
In issue in that case was the validity of President Nixon's claim of executive privilege against a
subpoena issued by a district court requiring the production of certain tapes and documents
relating to the Watergate investigations. The claim of privilege was based on the President's
general interest in the confidentiality of his conversations and correspondence. The U.S. Court
held that while there is no explicit reference to a privilege of confidentiality in the U.S.
Constitution, it is constitutionally based to the extent that it relates to the effective discharge of a
President's powers. The Court, nonetheless, rejected the President's claim of privilege, ruling that
the privilege must be balanced against the public interest in the fair administration of criminal
justice. Notably, the Court was careful to clarify that it was not there addressing the issue of
claims of privilege in a civil litigation or against congressional demands for information.

Cases in the U.S. which involve claims of executive privilege against Congress are rare.73
Despite frequent assertion of the privilege to deny information to Congress, beginning with
President Washington's refusal to turn over treaty negotiation records to the House of
Representatives, the U.S. Supreme Court has never adjudicated the issue.74 However, the U.S.
Court of Appeals for the District of Columbia Circuit, in a case decided earlier in the same year
as Nixon, recognized the President's privilege over his conversations against a congressional
subpoena.75 Anticipating the balancing approach adopted by the U.S. Supreme Court in Nixon,
the Court of Appeals weighed the public interest protected by the claim of privilege against the
interest that would be served by disclosure to the Committee. Ruling that the balance favored the
President, the Court declined to enforce the subpoena.76

In this jurisdiction, the doctrine of executive privilege was recognized by this Court in Almonte
v. Vasquez.77 Almonte used the term in reference to the same privilege subject of Nixon. It
quoted the following portion of the Nixon decision which explains the basis for the privilege:

"The expectation of a President to the confidentiality of his conversations and correspondences,

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

Almonte involved a subpoena duces tecum issued by the Ombudsman against the therein
petitioners. It did not involve, as expressly stated in the decision, the right of the people to
information.78 Nonetheless, the Court recognized that there are certain types of information
which the government may withhold from the public, thus acknowledging, in substance if not in
name, that executive privilege may be claimed against citizens' demands for information.

In Chavez v. PCGG,79 the Court held that this jurisdiction recognizes the common law holding
that there is a "governmental privilege against public disclosure with respect to state secrets
regarding military, diplomatic and other national security matters."80 The same case held that
closed-door Cabinet meetings are also a recognized limitation on the right to information.

Similarly, in Chavez v. Public Estates Authority,81 the Court ruled that the right to information
does not extend to matters recognized as "privileged information under the separation of
powers,"82 by which the Court meant Presidential conversations, correspondences, and
discussions in closed-door Cabinet meetings. It also held that information on military and
diplomatic secrets and those affecting national security, and information on investigations of
crimes by law enforcement agencies before the prosecution of the accused were exempted from
the right to information.

From the above discussion on the meaning and scope of executive privilege, both in the United
States and in this jurisdiction, a clear principle emerges. Executive privilege, whether asserted
against Congress, the courts, or the public, is recognized only in relation to certain types of
information of a sensitive character. While executive privilege is a constitutional concept, a
claim thereof may be valid or not depending on the ground invoked to justify it and the context
in which it is made. Noticeably absent is any recognition that executive officials are exempt from
the duty to disclose information by the mere fact of being executive officials. Indeed, the
extraordinary character of the exemptions indicates that the presumption inclines heavily against
executive secrecy and in favor of disclosure.

Validity of Section 1

Section 1 is similar to Section 3 in that both require the officials covered by them to secure the
consent of the President prior to appearing before Congress. There are significant differences
between the two provisions, however, which constrain this Court to discuss the validity of these
provisions separately.

Section 1 specifically applies to department heads. It does not, unlike Section 3, require a prior
determination by any official whether they are covered by E.O. 464. The President herself has,
through the challenged order, made the determination that they are. Further, unlike also Section
3, the coverage of department heads under Section 1 is not made to depend on the department
heads' possession of any information which might be covered by executive privilege. In fact, in
marked contrast to Section 3 vis - à-vis Section 2, there is no reference to executive privilege at
all. Rather, the required prior consent under Section 1 is grounded on Article VI, Section 22 of
the Constitution on what has been referred to as the question hour.

SECTION 22. The heads of departments may upon their own initiative, with the consent of the
President, or upon the request of either House, as the rules of each House shall provide, appear
before and be heard by such House on any matter pertaining to their departments. Written
questions shall be submitted to the President of the Senate or the Speaker of the House of
Representatives at least three days before their scheduled appearance. Interpellations shall not be
limited to written questions, but may cover matters related thereto. When the security of the State
or the public interest so requires and the President so states in writing, the appearance shall be
conducted in executive session.

Determining the validity of Section 1 thus requires an examination of the meaning of Section 22
of Article VI. Section 22 which provides for the question hour must be interpreted vis - à-vis
Section 21 which provides for the power of either House of Congress to "conduct inquiries in aid
of legislation." As the following excerpt of the deliberations of the Constitutional Commission
shows, the framers were aware that these two provisions involved distinct functions of Congress.

MR. MAAMBONG. x x x When we amended Section 20 [now Section 22 on the Question

Hour] yesterday, I noticed that members of the Cabinet cannot be compelled anymore to appear
before the House of Representatives or before the Senate. I have a particular problem in this
regard, Madam President, because in our experience in the Regular Batasang Pambansa - as the
Gentleman himself has experienced in the interim Batasang Pambansa - one of the most
competent inputs that we can put in our committee deliberations, either in aid of legislation or in
congressional investigations, is the testimonies of Cabinet ministers. We usually invite them, but
if they do not come and it is a congressional investigation, we usually issue subpoenas.
I want to be clarified on a statement made by Commissioner Suarez when he said that the fact
that the Cabinet ministers may refuse to come to the House of Representatives or the Senate
[when requested under Section 22] does not mean that they need not come when they are invited
or subpoenaed by the committee of either House when it comes to inquiries in aid of legislation
or congressional investigation. According to Commissioner Suarez, that is allowed and their
presence can be had under Section 21. Does the gentleman confirm this, Madam President? cralawlibrary

MR. DAVIDE. We confirm that, Madam President, because Section 20 refers only to what was
originally the Question Hour, whereas, Section 21 would refer specifically to inquiries in aid of
legislation, under which anybody for that matter, may be summoned and if he refuses, he can be
held in contempt of the House.83 (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

A distinction was thus made between inquiries in aid of legislation and the question hour. While
attendance was meant to be discretionary in the question hour, it was compulsory in inquiries in
aid of legislation. The reference to Commissioner Suarez bears noting, he being one of the
proponents of the amendment to make the appearance of department heads discretionary in the
question hour.

So clearly was this distinction conveyed to the members of the Commission that the Committee
on Style, precisely in recognition of this distinction, later moved the provision on question hour
from its original position as Section 20 in the original draft down to Section 31, far from the
provision on inquiries in aid of legislation. This gave rise to the following exchange during the
deliberations:

MR. GUINGONA. [speaking in his capacity as Chairman of the Committee on Style] We now
go, Mr. Presiding Officer, to the Article on Legislative and may I request the chairperson of the
Legislative Department, Commissioner Davide, to give his reaction.

THE PRESIDING OFFICER (Mr. Jamir). Commissioner Davide is recognized. ςηαñrοblεš Î½Î¹r† Ï…αl  lαω  lιbrαrÿ

MR. DAVIDE. Thank you, Mr. Presiding Officer. I have only one reaction to the Question Hour.
I propose that instead of putting it as Section 31, it should follow Legislative Inquiries.

THE PRESIDING OFFICER. What does the committee say? cralawlibrary

MR. GUINGONA. I ask Commissioner Maambong to reply, Mr. Presiding Officer.

MR. MAAMBONG. Actually, we considered that previously when we sequenced this but we
reasoned that in Section 21, which is Legislative Inquiry, it is actually a power of Congress in
terms of its own lawmaking; whereas, a Question Hour is not actually a power in terms of its
own lawmaking power because in Legislative Inquiry, it is in aid of legislation. And so we put
Question Hour as Section 31. I hope Commissioner Davide will consider this.

MR. DAVIDE. The Question Hour is closely related with the legislative power, and it is
precisely as a complement to or a supplement of the Legislative Inquiry. The appearance of the
members of Cabinet would be very, very essential not only in the application of check and
balance but also, in effect, in aid of legislation.

MR. MAAMBONG. After conferring with the committee, we find merit in the suggestion of
Commissioner Davide. In other words, we are accepting that and so this Section 31 would now
become Section 22. Would it be, Commissioner Davide? cralawlibrary

MR. DAVIDE. Yes.84 (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

Consistent with their statements earlier in the deliberations, Commissioners Davide and
Maambong proceeded from the same assumption that these provisions pertained to two different
functions of the legislature. Both Commissioners understood that the power to conduct inquiries
in aid of legislation is different from the power to conduct inquiries during the question hour.
Commissioner Davide's only concern was that the two provisions on these distinct powers be
placed closely together, they being complementary to each other. Neither Commissioner
considered them as identical functions of Congress.

The foregoing opinion was not the two Commissioners' alone. From the above-quoted exchange,
Commissioner Maambong's committee - the Committee on Style - shared the view that the two
provisions reflected distinct functions of Congress. Commissioner Davide, on the other hand,
was speaking in his capacity as Chairman of the Committee on the Legislative Department. His
views may thus be presumed as representing that of his Committee.

In the context of a parliamentary system of government, the "question hour" has a definite
meaning. It is a period of confrontation initiated by Parliament to hold the Prime Minister and
the other ministers accountable for their acts and the operation of the government,85
corresponding to what is known in Britain as the question period. There was a specific provision
for a question hour in the 1973 Constitution86 which made the appearance of ministers
mandatory. The same perfectly conformed to the parliamentary system established by that
Constitution, where the ministers are also members of the legislature and are directly accountable
to it.

An essential feature of the parliamentary system of government is the immediate accountability

of the Prime Minister and the Cabinet to the National Assembly. They shall be responsible to the
National Assembly for the program of government and shall determine the guidelines of national
policy. Unlike in the presidential system where the tenure of office of all elected officials cannot
be terminated before their term expired, the Prime Minister and the Cabinet remain in office only
as long as they enjoy the confidence of the National Assembly. The moment this confidence is
lost the Prime Minister and the Cabinet may be changed.87

The framers of the 1987 Constitution removed the mandatory nature of such appearance during
the question hour in the present Constitution so as to conform more fully to a system of
separation of powers.88 To that extent, the question hour, as it is presently understood in this
jurisdiction, departs from the question period of the parliamentary system. That department
heads may not be required to appear in a question hour does not, however, mean that the
legislature is rendered powerless to elicit information from them in all circumstances. In fact, in
light of the absence of a mandatory question period, the need to enforce Congress' right to
executive information in the performance of its legislative function becomes more imperative.
As Schwartz observes:

Indeed, if the separation of powers has anything to tell us on the subject under discussion, it is
that the Congress has the right to obtain information from any source - even from officials of
departments and agencies in the executive branch. In the United States there is, unlike the
situation which prevails in a parliamentary system such as that in Britain, a clear separation
between the legislative and executive branches. It is this very separation that makes the
congressional right to obtain information from the executive so essential, if the functions of the
Congress as the elected representatives of the people are adequately to be carried out. The
absence of close rapport between the legislative and executive branches in this country,
comparable to those which exist under a parliamentary system, and the nonexistence in the
Congress of an institution such as the British question period have perforce made reliance by the
Congress upon its right to obtain information from the executive essential, if it is intelligently to
perform its legislative tasks. Unless the Congress possesses the right to obtain executive
information, its power of oversight of administration in a system such as ours becomes a power
devoid of most of its practical content, since it depends for its effectiveness solely upon
information parceled out ex gratia by the executive.89 (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

Sections 21 and 22, therefore, while closely related and complementary to each other, should not
be considered as pertaining to the same power of Congress. One specifically relates to the power
to conduct inquiries in aid of legislation, the aim of which is to elicit information that may be
used for legislation, while the other pertains to the power to conduct a question hour, the
objective of which is to obtain information in pursuit of Congress' oversight function.

When Congress merely seeks to be informed on how department heads are implementing the
statutes which it has issued, its right to such information is not as imperative as that of the
President to whom, as Chief Executive, such department heads must give a report of their
performance as a matter of duty. In such instances, Section 22, in keeping with the separation of
powers, states that Congress may only request their appearance. Nonetheless, when the inquiry in
which Congress requires their appearance is "in aid of legislation" under Section 21, the
appearance is mandatory for the same reasons stated in Arnault.90

In fine, the oversight function of Congress may be facilitated by compulsory process only to the
extent that it is performed in pursuit of legislation. This is consistent with the intent discerned
from the deliberations of the Constitutional Commission.

Ultimately, the power of Congress to compel the appearance of executive officials under Section
21 and the lack of it under Section 22 find their basis in the principle of separation of powers.
While the executive branch is a co-equal branch of the legislature, it cannot frustrate the power
of Congress to legislate by refusing to comply with its demands for information.

When Congress exercises its power of inquiry, the only way for department heads to exempt
themselves therefrom is by a valid claim of privilege. They are not exempt by the mere fact that
they are department heads. Only one executive official may be exempted from this power - the
President on whom executive power is vested, hence, beyond the reach of Congress except
through the power of impeachment. It is based on her being the highest official of the executive
branch, and the due respect accorded to a co-equal branch of government which is sanctioned by
a long-standing custom.

By the same token, members of the Supreme Court are also exempt from this power of inquiry.
Unlike the Presidency, judicial power is vested in a collegial body; hence, each member thereof
is exempt on the basis not only of separation of powers but also on the fiscal autonomy and the
constitutional independence of the judiciary. This point is not in dispute, as even counsel for the
Senate, Sen. Joker Arroyo, admitted it during the oral argument upon interpellation of the Chief
Justice.

Having established the proper interpretation of Section 22, Article VI of the Constitution, the
Court now proceeds to pass on the constitutionality of Section 1 of E.O. 464.

Section 1, in view of its specific reference to Section 22 of Article VI of the Constitution and the
absence of any reference to inquiries in aid of legislation, must be construed as limited in its
application to appearances of department heads in the question hour contemplated in the
provision of said Section 22 of Article VI. The reading is dictated by the basic rule of
construction that issuances must be interpreted, as much as possible, in a way that will render it
constitutional.

The requirement then to secure presidential consent under Section 1, limited as it is only to
appearances in the question hour, is valid on its face. For under Section 22, Article VI of the
Constitution, the appearance of department heads in the question hour is discretionary on their
part.

Section 1 cannot, however, be applied to appearances of department heads in inquiries in aid of

legislation. Congress is not bound in such instances to respect the refusal of the department head
to appear in such inquiry, unless a valid claim of privilege is subsequently made, either by the
President herself or by the Executive Secretary.

Validity of Sections 2 and 3

Section 3 of E.O. 464 requires all the public officials enumerated in Section 2(b) to secure the
consent of the President prior to appearing before either house of Congress. The enumeration is
broad. It covers all senior officials of executive departments, all officers of the AFP and the PNP,
and all senior national security officials who, in the judgment of the heads of offices designated
in the same section (i.e. department heads, Chief of Staff of the AFP, Chief of the PNP, and the
National Security Adviser), are "covered by the executive privilege."

The enumeration also includes such other officers as may be determined by the President. Given
the title of Section 2 - "Nature, Scope and Coverage of Executive Privilege" ', it is evident that
under the rule of ejusdem generis, the determination by the President under this provision is
intended to be based on a similar finding of coverage under executive privilege.
En passant, the Court notes that Section 2(b) of E.O. 464 virtually states that executive privilege
actually covers persons. Such is a misuse of the doctrine. Executive privilege, as discussed
above, is properly invoked in relation to specific categories of information and not to categories
of persons.

In light, however, of Sec 2(a) of E.O. 464 which deals with the nature, scope and coverage of
executive privilege, the reference to persons being "covered by the executive privilege" may be
read as an abbreviated way of saying that the person is in possession of information which is, in
the judgment of the head of office concerned, privileged as defined in Section 2(a). The Court
shall thus proceed on the assumption that this is the intention of the challenged order.

Upon a determination by the designated head of office or by the President that an official is
"covered by the executive privilege," such official is subjected to the requirement that he first
secure the consent of the President prior to appearing before Congress. This requirement
effectively bars the appearance of the official concerned unless the same is permitted by the
President. The proviso allowing the President to give its consent means nothing more than that
the President may reverse a prohibition which already exists by virtue of E.O. 464.

Thus, underlying this requirement of prior consent is the determination by a head of office,
authorized by the President under E.O. 464, or by the President herself, that such official is in
possession of information that is covered by executive privilege. This determination then
becomes the basis for the official's not showing up in the legislative investigation.

In view thereof, whenever an official invokes E.O. 464 to justify his failure to be present, such
invocation must be construed as a declaration to Congress that the President, or a head of office
authorized by the President, has determined that the requested information is privileged, and that
the President has not reversed such determination. Such declaration, however, even without
mentioning the term "executive privilege," amounts to an implied claim that the information is
being withheld by the executive branch, by authority of the President, on the basis of executive
privilege. Verily, there is an implied claim of privilege.

The letter dated September 28, 2005 of respondent Executive Secretary Ermita to Senate
President Drilon illustrates the implied nature of the claim of privilege authorized by E.O. 464. It
reads:

In connection with the inquiry to be conducted by the Committee of the Whole regarding the
Northrail Project of the North Luzon Railways Corporation on 29 September 2005 at 10:00 a.m.,
please be informed that officials of the Executive Department invited to appear at the meeting
will not be able to attend the same without the consent of the President, pursuant to Executive
Order No. 464 (s. 2005), entitled "Ensuring Observance Of The Principle Of Separation Of
Powers, Adherence To The Rule On Executive Privilege And Respect For The Rights Of Public
Officials Appearing In Legislative Inquiries In Aid Of Legislation Under The Constitution, And
For Other Purposes". Said officials have not secured the required consent from the President.
(Underscoring supplied) ςrαlαωlιbrαrÿ
The letter does not explicitly invoke executive privilege or that the matter on which these
officials are being requested to be resource persons falls under the recognized grounds of the
privilege to justify their absence. Nor does it expressly state that in view of the lack of consent
from the President under E.O. 464, they cannot attend the hearing.

Significant premises in this letter, however, are left unstated, deliberately or not. The letter
assumes that the invited officials are covered by E.O. 464. As explained earlier, however, to be
covered by the order means that a determination has been made, by the designated head of office
or the President, that the invited official possesses information that is covered by executive
privilege. Thus, although it is not stated in the letter that such determination has been made, the
same must be deemed implied. Respecting the statement that the invited officials have not
secured the consent of the President, it only means that the President has not reversed the
standing prohibition against their appearance before Congress.

Inevitably, Executive Secretary Ermita's letter leads to the conclusion that the executive branch,
either through the President or the heads of offices authorized under E.O. 464, has made a
determination that the information required by the Senate is privileged, and that, at the time of
writing, there has been no contrary pronouncement from the President. In fine, an implied claim
of privilege has been made by the executive.

While there is no Philippine case that directly addresses the issue of whether executive privilege
may be invoked against Congress, it is gathered from Chavez v. PEA that certain information in
the possession of the executive may validly be claimed as privileged even against Congress.
Thus, the case holds:

There is no claim by PEA that the information demanded by petitioner is privileged information
rooted in the separation of powers. The information does not cover Presidential conversations,
correspondences, or discussions during closed-door Cabinet meetings which, like internal-
deliberations of the Supreme Court and other collegiate courts, or executive sessions of either
house of Congress, are recognized as confidential. This kind of information cannot be pried open
by a co-equal branch of government. A frank exchange of exploratory ideas and assessments,
free from the glare of publicity and pressure by interested parties, is essential to protect the
independence of decision-making of those tasked to exercise Presidential, Legislative and
Judicial power. This is not the situation in the instant case.91 (Emphasis and underscoring
supplied)ςrαlαωlιbrαrÿ

Section 3 of E.O. 464, therefore, cannot be dismissed outright as invalid by the mere fact that it
sanctions claims of executive privilege. This Court must look further and assess the claim of
privilege authorized by the Order to determine whether it is valid.

While the validity of claims of privilege must be assessed on a case to case basis, examining the
ground invoked therefor and the particular circumstances surrounding it, there is, in an implied
claim of privilege, a defect that renders it invalid per se. By its very nature, and as demonstrated
by the letter of respondent Executive Secretary quoted above, the implied claim authorized by
Section 3 of E.O. 464 is not accompanied by any specific allegation of the basis thereof (e.g.,
whether the information demanded involves military or diplomatic secrets, closed-door Cabinet
meetings, etc.). While Section 2(a) enumerates the types of information that are covered by the
privilege under the challenged order, Congress is left to speculate as to which among them is
being referred to by the executive. The enumeration is not even intended to be comprehensive,
but a mere statement of what is included in the phrase "confidential or classified information
between the President and the public officers covered by this executive order."

Certainly, Congress has the right to know why the executive considers the requested information
privileged. It does not suffice to merely declare that the President, or an authorized head of
office, has determined that it is so, and that the President has not overturned that determination.
Such declaration leaves Congress in the dark on how the requested information could be
classified as privileged. That the message is couched in terms that, on first impression, do not
seem like a claim of privilege only makes it more pernicious. It threatens to make Congress
doubly blind to the question of why the executive branch is not providing it with the information
that it has requested.

A claim of privilege, being a claim of exemption from an obligation to disclose information,

must, therefore, be clearly asserted. As U.S. v. Reynolds teaches:

The privilege belongs to the government and must be asserted by it; it can neither be claimed nor
waived by a private party. It is not to be lightly invoked. There must be a formal claim of
privilege, lodged by the head of the department which has control over the matter, after actual
personal consideration by that officer. The court itself must determine whether the circumstances
are appropriate for the claim of privilege, and yet do so without forcing a disclosure of the very
thing the privilege is designed to protect.92 (Underscoring supplied)ςrαlαωlιbrαrÿ

Absent then a statement of the specific basis of a claim of executive privilege, there is no way of
determining whether it falls under one of the traditional privileges, or whether, given the
circumstances in which it is made, it should be respected.93 These, in substance, were the same
criteria in assessing the claim of privilege asserted against the Ombudsman in Almonte v.
Vasquez94 and, more in point, against a committee of the Senate in Senate Select Committee on
Presidential Campaign Activities v. Nixon.95

A.O. Smith v. Federal Trade Commission is enlightening:

[T]he lack of specificity renders an assessment of the potential harm resulting from disclosure
impossible, thereby preventing the Court from balancing such harm against plaintiffs' needs to
determine whether to override any claims of privilege.96 (Underscoring supplied) ςrαlαωlιbrαrÿ

And so is U.S. v. Article of Drug:97

On the present state of the record, this Court is not called upon to perform this balancing
operation. In stating its objection to claimant's interrogatories, government asserts, and nothing
more, that the disclosures sought by claimant would inhibit the free expression of opinion that
non-disclosure is designed to protect. The government has not shown - nor even alleged - that
those who evaluated claimant's product were involved in internal policymaking, generally, or in
this particular instance. Privilege cannot be set up by an unsupported claim. The facts upon
which the privilege is based must be established. To find these interrogatories objectionable, this
Court would have to assume that the evaluation and classification of claimant's products was a
matter of internal policy formulation, an assumption in which this Court is unwilling to indulge
sua sponte.98 (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

Mobil Oil Corp. v. Department of Energy99 similarly emphasizes that "an agency must provide
'precise and certain' reasons for preserving the confidentiality of requested information."

Black v. Sheraton Corp. of America100 amplifies, thus:

A formal and proper claim of executive privilege requires a specific designation and description
of the documents within its scope as well as precise and certain reasons for preserving their
confidentiality. Without this specificity, it is impossible for a court to analyze the claim short of
disclosure of the very thing sought to be protected. As the affidavit now stands, the Court has
little more than its sua sponte speculation with which to weigh the applicability of the claim. An
improperly asserted claim of privilege is no claim of privilege. Therefore, despite the fact that a
claim was made by the proper executive as Reynolds requires, the Court can not recognize the
claim in the instant case because it is legally insufficient to allow the Court to make a just and
reasonable determination as to its applicability. To recognize such a broad claim in which the
Defendant has given no precise or compelling reasons to shield these documents from outside
scrutiny, would make a farce of the whole procedure.101 (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

Due respect for a co-equal branch of government, moreover, demands no less than a claim of
privilege clearly stating the grounds therefor. Apropos is the following ruling in McPhaul v.
U.S:102

We think the Court's decision in United States v. Bryan, 339 U.S. 323, 70 S. Ct. 724, is highly
relevant to these questions. For it is as true here as it was there, that 'if (petitioner) had legitimate
reasons for failing to produce the records of the association, a decent respect for the House of
Representatives, by whose authority the subpoenas issued, would have required that (he) state
(his) reasons for noncompliance upon the return of the writ. Such a statement would have given
the Subcommittee an opportunity to avoid the blocking of its inquiry by taking other appropriate
steps to obtain the records. 'To deny the Committee the opportunity to consider the objection or
remedy is in itself a contempt of its authority and an obstruction of its processes. His failure to
make any such statement was "a patent evasion of the duty of one summoned to produce papers
before a congressional committee[, and] cannot be condoned." (Emphasis and underscoring
supplied; citations omitted)

Upon the other hand, Congress must not require the executive to state the reasons for the claim
with such particularity as to compel disclosure of the information which the privilege is meant to
protect.103 A useful analogy in determining the requisite degree of particularity would be the
privilege against self-incrimination. Thus, Hoffman v. U.S.104 declares:

The witness is not exonerated from answering merely because he declares that in so doing he
would incriminate himself - his say-so does not of itself establish the hazard of incrimination. It
is for the court to say whether his silence is justified, and to require him to answer if 'it clearly
appears to the court that he is mistaken.' However, if the witness, upon interposing his claim,
were required to prove the hazard in the sense in which a claim is usually required to be
established in court, he would be compelled to surrender the very protection which the privilege
is designed to guarantee. To sustain the privilege, it need only be evident from the implications
of the question, in the setting in which it is asked, that a responsive answer to the question or an
explanation of why it cannot be answered might be dangerous because injurious disclosure could
result." x x x (Emphasis and underscoring supplied) ςrαlαωlιbrαrÿ

The claim of privilege under Section 3 of E.O. 464 in relation to Section 2(b) is thus invalid per
se. It is not asserted. It is merely implied. Instead of providing precise and certain reasons for the
claim, it merely invokes E.O. 464, coupled with an announcement that the President has not
given her consent. It is woefully insufficient for Congress to determine whether the withholding
of information is justified under the circumstances of each case. It severely frustrates the power
of inquiry of Congress.

In fine, Section 3 and Section 2(b) of E.O. 464 must be invalidated.

No infirmity, however, can be imputed to Section 2(a) as it merely provides guidelines, binding
only on the heads of office mentioned in Section 2(b), on what is covered by executive privilege.
It does not purport to be conclusive on the other branches of government. It may thus be
construed as a mere expression of opinion by the President regarding the nature and scope of
executive privilege.

Petitioners, however, assert as another ground for invalidating the challenged order the alleged
unlawful delegation of authority to the heads of offices in Section 2(b). Petitioner Senate of the
Philippines, in particular, cites the case of the United States where, so it claims, only the
President can assert executive privilege to withhold information from Congress.

Section 2(b) in relation to Section 3 virtually provides that, once the head of office determines
that a certain information is privileged, such determination is presumed to bear the President's
authority and has the effect of prohibiting the official from appearing before Congress, subject
only to the express pronouncement of the President that it is allowing the appearance of such
official. These provisions thus allow the President to authorize claims of privilege by mere
silence.

Such presumptive authorization, however, is contrary to the exceptional nature of the privilege.
Executive privilege, as already discussed, is recognized with respect to information the
confidential nature of which is crucial to the fulfillment of the unique role and responsibilities of
the executive branch,105 or in those instances where exemption from disclosure is necessary to the
discharge of highly important executive responsibilities.106 The doctrine of executive privilege is
thus premised on the fact that certain informations must, as a matter of necessity, be kept
confidential in pursuit of the public interest. The privilege being, by definition, an exemption
from the obligation to disclose information, in this case to Congress, the necessity must be of
such high degree as to outweigh the public interest in enforcing that obligation in a particular
case.
In light of this highly exceptional nature of the privilege, the Court finds it essential to limit to
the President the power to invoke the privilege. She may of course authorize the Executive
Secretary to invoke the privilege on her behalf, in which case the Executive Secretary must state
that the authority is "By order of the President," which means that he personally consulted with
her. The privilege being an extraordinary power, it must be wielded only by the highest official
in the executive hierarchy. In other words, the President may not authorize her subordinates to
exercise such power. There is even less reason to uphold such authorization in the instant case
where the authorization is not explicit but by mere silence. Section 3, in relation to Section 2(b),
is further invalid on this score.

It follows, therefore, that when an official is being summoned by Congress on a matter which, in
his own judgment, might be covered by executive privilege, he must be afforded reasonable time
to inform the President or the Executive Secretary of the possible need for invoking the privilege.
This is necessary in order to provide the President or the Executive Secretary with fair
opportunity to consider whether the matter indeed calls for a claim of executive privilege. If,
after the lapse of that reasonable time, neither the President nor the Executive Secretary invokes
the privilege, Congress is no longer bound to respect the failure of the official to appear before
Congress and may then opt to avail of the necessary legal means to compel his appearance.

The Court notes that one of the expressed purposes for requiring officials to secure the consent of
the President under Section 3 of E.O. 464 is to ensure "respect for the rights of public officials
appearing in inquiries in aid of legislation." That such rights must indeed be respected by
Congress is an echo from Article VI Section 21 of the Constitution mandating that "[t]he rights
of persons appearing in or affected by such inquiries shall be respected."

In light of the above discussion of Section 3, it is clear that it is essentially an authorization for
implied claims of executive privilege, for which reason it must be invalidated. That such
authorization is partly motivated by the need to ensure respect for such officials does not change
the infirm nature of the authorization itself.

Right to Information

E.O 464 is concerned only with the demands of Congress for the appearance of executive
officials in the hearings conducted by it, and not with the demands of citizens for information
pursuant to their right to information on matters of public concern. Petitioners are not amiss in
claiming, however, that what is involved in the present controversy is not merely the legislative
power of inquiry, but the right of the people to information.

There are, it bears noting, clear distinctions between the right of Congress to information which
underlies the power of inquiry and the right of the people to information on matters of public
concern. For one, the demand of a citizen for the production of documents pursuant to his right
to information does not have the same obligatory force as a subpoena duces tecum issued by
Congress. Neither does the right to information grant a citizen the power to exact testimony from
government officials. These powers belong only to Congress and not to an individual citizen.
Thus, while Congress is composed of representatives elected by the people, it does not follow,
except in a highly qualified sense, that in every exercise of its power of inquiry, the people are
exercising their right to information.

To the extent that investigations in aid of legislation are generally conducted in public, however,
any executive issuance tending to unduly limit disclosures of information in such investigations
necessarily deprives the people of information which, being presumed to be in aid of legislation,
is presumed to be a matter of public concern. The citizens are thereby denied access to
information which they can use in formulating their own opinions on the matter before Congress
- opinions which they can then communicate to their representatives and other government
officials through the various legal means allowed by their freedom of expression. Thus holds
Valmonte v. Belmonte:

It is in the interest of the State that the channels for free political discussion be maintained to the
end that the government may perceive and be responsive to the people's will. Yet, this open
dialogue can be effective only to the extent that the citizenry is informed and thus able to
formulate its will intelligently. Only when the participants in the discussion are aware of the
issues and have access to information relating thereto can such bear fruit.107 (Emphasis and
underscoring supplied) ςrαlαωlιbrαrÿ

The impairment of the right of the people to information as a consequence of E.O. 464 is,
therefore, in the sense explained above, just as direct as its violation of the legislature's power of
inquiry.

Implementation of E.O. 464 prior to its publication

While E.O. 464 applies only to officials of the executive branch, it does not follow that the same
is exempt from the need for publication. On the need for publishing even those statutes that do
not directly apply to people in general, Tañada v. Tuvera states:

The term "laws" should refer to all laws and not only to those of general application, for strictly
speaking all laws relate to the people in general albeit there are some that do not apply to them
directly. An example is a law granting citizenship to a particular individual, like a relative of
President Marcos who was decreed instant naturalization. It surely cannot be said that such a law
does not affect the public although it unquestionably does not apply directly to all the people.
The subject of such law is a matter of public interest which any member of the body politic may
question in the political forums or, if he is a proper party, even in courts of justice.108 (Emphasis
and underscoring supplied) ςrαlαωlιbrαrÿ

Although the above statement was made in reference to statutes, logic dictates that the
challenged order must be covered by the publication requirement. As explained above, E.O. 464
has a direct effect on the right of the people to information on matters of public concern. It is,
therefore, a matter of public interest which members of the body politic may question before this
Court. Due process thus requires that the people should have been apprised of this issuance
before it was implemented.
Conclusion

Congress undoubtedly has a right to information from the executive branch whenever it is sought
in aid of legislation. If the executive branch withholds such information on the ground that it is
privileged, it must so assert it and state the reason therefor and why it must be respected.

The infirm provisions of E.O. 464, however, allow the executive branch to evade congressional
requests for information without need of clearly asserting a right to do so and/or proffering its
reasons therefor. By the mere expedient of invoking said provisions, the power of Congress to
conduct inquiries in aid of legislation is frustrated. That is impermissible. For

[w]hat republican theory did accomplish was to reverse the old presumption in favor of secrecy,
based on the divine right of kings and nobles, and replace it with a presumption in favor of
publicity, based on the doctrine of popular sovereignty. (Underscoring supplied)109

Resort to any means then by which officials of the executive branch could refuse to divulge
information cannot be presumed valid. Otherwise, we shall not have merely nullified the power
of our legislature to inquire into the operations of government, but we shall have given up
something of much greater value - our right as a people to take part in government.

WHEREFORE, the petitions are PARTLY GRANTED. Sections 2(b) and 3 of Executive Order
No. 464 (series of 2005), "Ensuring Observance of the Principle of Separation of Powers,
Adherence to the Rule on Executive

Privilege and Respect for the Rights of Public Officials Appearing in Legislative Inquiries in Aid
of Legislation Under the Constitution, and For Other Purposes," are declared VOID. Sections 1
and 2(a) are, however, VALID.

SO ORDERED.
 [G.R. No. 132988. July 19, 2000.]

AQUILINO Q. PIMENTEL, JR., Petitioner, v. Hon. ALEXANDER AGUIRRE in his

capacity as Executive Secretary, Hon. EMILIA BONCODIN in her capacity as Secretary of
the Department of Budget and Management, Respondents.

ROBERTO PAGDANGANAN, intervenor.

DECISION

PANGANIBAN, J.:

The Constitution vests the President with the power of supervision, not control, over local
government units (LGUs). Such power enables him to see to it that LGUs and their officials
execute their tasks in accordance with law. While he may issue advisories and seek their
cooperation in solving economic difficulties, he cannot prevent them from performing their tasks
and using available resources to achieve their goals. He may not withhold or alter any authority
or power given them by the law. Thus, the withholding of a portion of internal revenue
allotments legally due them cannot be directed by administrative fiat. chanrobles virtual lawlibrary

The Case

Before us is an original Petition for Certiorari and Prohibition seeking (1) to annul Section 1 of
Administrative Order (AO) No. 372, insofar as it requires local government units to reduce their
expenditures by 25 percent of their authorized regular appropriations for non-personal services;
and (2) to enjoin respondents from implementing Section 4 of the Order, which withholds a
portion of their internal revenue allotments.

On November 17, 1998, Roberto Pagdanganan, through Counsel Alberto C. Agra, filed a Motion
for Intervention/Motion to Admit Petition for Intervention, 1 attaching thereto his Petition in
Intervention 2 joining petitioner in the reliefs sought. At the time, intervenor was the provincial
governor of Bulacan, national president of the League of Provinces of the Philippines and
chairman of the League of Leagues of Local Governments. In a Resolution dated December 15,
1998, the Court noted said Motion and Petition.

The Facts and the Arguments

On December 27, 1997, the President of the Philippines issued AO 372. Its full text, with
emphasis on the assailed provisions, is as follows:jgc:chanrobles.com.ph

"ADMINISTRATIVE ORDER NO. 372

ADOPTION OF ECONOMY MEASURES IN GOVERNMENT FOR FY 1998

WHEREAS, the current economic difficulties brought about by the peso depreciation requires
continued prudence in government fiscal management to maintain economic stability and sustain
the country’s growth momentum;

WHEREAS, it is imperative that all government agencies adopt cash management measures to
match expenditures with available resources;

NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by

virtue of the powers vested in me by the Constitution, do hereby order and direct: chanrob1es virtual 1aw library

SECTION 1. All government departments and agencies, including state universities and colleges,
government-owned and controlled corporations and local governments units will identify and
implement measures in FY 1998 that will reduce total expenditures for the year by at least 25%
of authorized regular appropriations for non-personal services items, along the following
suggested areas: chanrob1es virtual 1aw library

1. Continued implementation of the streamlining policy on organization and staffing by deferring

action on the following: chanrob1es virtual 1aw library

a. Operationalization of new agencies;

b. Expansion of organizational units and/or creation of positions;

c. Filling of positions; and

d. Hiring of additional/new consultants, contractual and casual personnel, regardless of funding

source.

2. Suspension of the following activities: chanrob1es virtual 1aw library

a. Implementation of new capital/infrastructure projects, except those which have already been
contracted out;

b. Acquisition of new equipment and motor vehicles;

c. All foreign travels of government personnel, except those associated with scholarships and
trainings funded by grants;

d. Attendance in conferences abroad where the cost is charged to the government except those
clearly essential to Philippine commitments in the international field as may be determined by
the Cabinet;

e. Conduct of trainings/workshops/seminars, except those conducted by government training

institutions and agencies in the performance of their regular functions and those that are funded
by grants;
f. Conduct of cultural and social celebrations and sports activities, except those associated with
the Philippine Centennial celebration and those involving regular competitions/events;

g. Grant of honoraria, except in cases where it constitutes the only source of compensation from
government received by the person concerned;

h. Publications, media advertisements and related items, except those required by law or those
already being undertaken on a regular basis;

i. Grant of new/additional benefits to employees, except, those expressly and specifically

authorized by law; and

j. Donations, contributions, grants and gifts, except those given by institutions to victims of
calamities.

3. Suspension of all tax expenditure subsidies to all GOCCs and LGUs

4. Reduction in the volume of consumption of fuel, water, office supplies, electricity and other
utilities

5. Deferment of projects that are encountering significant implementation problems

6. Suspension of all realignment of funds and the use of savings and reserves

SECTION 2. Agencies are given the flexibility to identify the specific sources of cost-savings,
provided the 25% minimum savings under Section 1 is complied with.

SECTION 3. A report on the estimated savings generated from these measures shall be
submitted to the Office of the President, through the Department of Budget and Management, on
a quarterly basis using the attached format.

SECTION 4. Pending the assessment and evaluation by the Development Budget Coordinating
Committee of the emerging fiscal situation, the amount equivalent to 10% of the internal revenue
allotment to local government units shall be withheld.

SECTION 5. The Development Budget Coordination Committee shall conduct a monthly review
of the fiscal position of the National Government and if necessary, shall recommend to the
President the imposition of additional reserves or the lifting of previously imposed reserves.

SECTION 6. This Administrative Order shall take effect January 1, 1998 and shall remain valid
for the entire year unless otherwise lifted.

DONE in the City of Manila, this 27th day of December, in the year of our Lord, nineteen
hundred and ninety-seven." cralaw virtua1aw library

Subsequently, on December 10, 1998, President Joseph E. Estrada issued AO 43, amending
Section 4 of AO 372, by reducing to five percent (5%) the amount of internal revenue allotment
(IRA) to be withheld from the LGUs.

Petitioner contends that the President, in issuing AO 372, was in effect exercising the power of
control over LGUs. The Constitution vests in the President, however, only the power of general
supervision over LGUs, consistent with the principle of local autonomy. Petitioner further argues
that the directive to withhold ten percent (10%) of their IRA is in contravention of Section 286 of
the Local Government Code and of Section 6, Article X of the Constitution, providing for the
automatic release to each of these units its share in the national internal revenue.

The solicitor general, on behalf of the respondents, claims on the other hand that AO 372 was
issued to alleviate the "economic difficulties brought about by the peso devaluation" and
constituted merely an exercise of the President’s power of supervision over LGUs. It allegedly
does not violate local fiscal autonomy, because it merely directs local governments to identify
measures that will reduce their total expenditures for non-personal services by at least 25
percent. Likewise, the withholding of 10 percent of the LGUs’ IRA does not violate the statutory
prohibition on the imposition of any lien or holdback on their revenue shares, because such
withholding is "temporary in nature pending the assessment and evaluation by the Development
Coordination Committee of the emerging fiscal situation." cralaw virtua1aw library

The Issues

The Petition 3 submits the following issues for the Court’s resolution: jgc:chanrobles.com.ph

"A. Whether or not the president committed grave abuse of discretion [in] ordering all LGUS to
adopt a 25% cost reduction program in violation of the LGU[’]S fiscal autonomy

"B. Whether or not the president committed grave abuse of discretion in ordering the
withholding of 10% of the LGU[’]S IRA"

In sum, the main issue is whether (a) Section 1 of AO 372, insofar as it "directs" LGUs to reduce
their expenditures by 25 percent; and (b) Section 4 of the same issuance, which withholds 10
percent of their internal revenue allotments, are valid exercises of the President’s power of
general supervision over local governments.

Additionally, the Court deliberated on the question whether petitioner had the locus standi to
bring this suit, despite respondents’ failure to raise the issue. 4 However, the intervention of
Roberto Pagdanganan has rendered academic any further discussion on this matter.

The Court’s Ruling

The Petition is partly meritorious.

Main Issue: chanrob1es virtual 1aw library

Validity of AO 372

Insofar as LGUs Are Concerned

Before resolving the main issue, we deem it important and appropriate to define certain crucial
concepts: (1) the scope of the President’s power of general supervision over local governments
and (2) the extent of the local governments’ autonomy.

Scope of Presidents Power of

Supervision Over LGUs

Section 4 of Article X of the Constitution confines the President’s power over local governments
to one of general supervision. It reads as follows: jgc:chanrobles.com.ph

"SECTION 4. The President of the Philippines shall exercise general supervision over local
governments. . . ."cralaw virtua1aw library

This provision has been interpreted to exclude the power of control. In Mondano v. Silvosa, 5 the
Court contrasted the President’s power of supervision over local government officials with that
of his power of control over executive officials of the national government. It was emphasized
that the two terms — supervision and control — differed in meaning and extent. The Court
distinguished them as follows: jgc:chanrobles.com.ph

". . . In administrative law, supervision means overseeing or the power or authority of an officer
to see that subordinate officers perform their duties. If the latter fail or neglect to fulfill them, the
former may take such action or step as prescribed by law to make them perform their duties.
Control, on the other hand, means the power of an officer to alter or modify or nullify or set
aside what a subordinate officer ha[s] done in the performance of his duties and to substitute the
judgment of the former for that of the latter." 6

In Taule v. Santos, 7 we further stated that the Chief Executive wielded no more authority than
that of checking whether local governments or their officials were performing their duties as
provided by the fundamental law and by statutes. He cannot interfere with local governments, so
long as they act within the scope of their authority. "Supervisory power, when contrasted with
control, is the power of mere oversight over an inferior body; it does not include any restraining
authority over such body," 8 we said.

In a more recent case, Drilon v. Lim, 9 the difference between control and supervision was
further delineated. Officers in control lay down the rules in the performance or accomplishment
of an act. If these rules are not followed, they may, in their discretion, order the act undone or
redone by their subordinates or even decide to do it themselves. On the other hand, supervision
does not cover such authority. Supervising officials merely see to it that the rules are followed,
but they themselves do not lay down such rules, nor do they have the discretion to modify or
replace them. If the rules are not observed, they may order the work done or redone, but only to
conform to such rules. They may not prescribe their own manner of execution of the act. They
have no discretion on this matter except to see to it that the rules are followed.

Under our present system of government, executive power is vested in the President. 10 The
members of the Cabinet and other executive officials are merely alter egos. As such, they are
subject to the power of control of the President, at whose will and behest they can be removed
from office; or their actions and decisions changed, suspended or reversed. 11 In contrast, the
heads of political subdivisions are elected by the people. Their sovereign powers emanate from
the electorate, to whom they are directly accountable. By constitutional fiat, they are subject to
the President’s supervision only, not control, so long as their acts are exercised within the sphere
of their legitimate powers. By the same token, the President may not withhold or alter any
authority or power given them by the Constitution and the law.

Extent of Local Autonomy

Hand in hand with the constitutional restraint on the President’s power over local governments is
the state policy of ensuring local autonomy. 12 In Ganzon v. Court of Appeals, 13 we said that
local autonomy signified "a more responsive and accountable local government structure
instituted through a system of decentralization." The grant of autonomy is intended to "break up
the monopoly of the national government over the affairs of local governments, . . . not . . . to
end the relation of partnership and interdependence between the central administration and local
government units . . ." Paradoxically, local governments are still subject to regulation, however
limited, for the purpose of enhancing self-government. 14

Decentralization simply means the devolution of national administration, not power, to local
governments. Local officials remain accountable to the central government as the law may
provide. 15 The difference between decentralization of administration and that of power was
explained in detail in Limbona v. Mangelin 16 as follows: jgc:chanrobles.com.ph

"Now, autonomy is either decentralization of administration or decentralization of power. There

is decentralization of administration when the central government delegates administrative
powers to political subdivisions in order to broaden the base of government power and in the
process to make local governments ‘more responsive and accountable,’ 17 and ‘ensure their
fullest development as self-reliant communities and make them more effective partners in the
pursuit of national development and social progress.’ 18 At the same time, it relieves the central
government of the burden of managing local affairs and enables it to concentrate on national
concerns. The President exercises ‘general supervision’ 19 over them, but only to ‘ensure that
local affairs are administered according to law.’ 20 He has no control over their acts in the sense
that he can substitute their judgments with his own. 21

Decentralization of power, on the other hand, involves an abdication of political power in the
favor of local government units declared to be autonomous. In that case, the autonomous
government is free to chart its own destiny and shape its future with minimum intervention from
central authorities. According to a constitutional author, decentralization of power amounts to
‘self-immolation,’ since in that event, the autonomous government becomes accountable not to
the central authorities but to its constituency." 22
Under the Philippine concept of local autonomy, the national government has not completely
relinquished all its powers over local governments, including autonomous regions. Only
administrative powers over local affairs are delegated to political subdivisions. The purpose of
the delegation is to make governance more directly responsive and effective at the local levels. In
turn, economic, political and social development at the smaller political units are expected to
propel social and economic growth and development. But to enable the country to develop as a
whole, the programs and policies effected locally must be integrated and coordinated towards a
common national goal. Thus, policy-setting for the entire country still lies in the President and
Congress. As we stated in Magtajas v. Pryce Properties Corp., Inc., municipal governments are
still agents of the national government. 23

The Nature of AO 372

Consistent with the foregoing jurisprudential precepts, let us now look into the nature of AO 372.
As its preambular clauses declare, the Order was a "cash management measure" adopted by the
government "to match expenditures with available resources," which were presumably depleted
at the time due to "economic difficulties brought about by the peso depreciation." Because of a
looming financial crisis, the President deemed it necessary to "direct all government agencies,
state universities and colleges, government owned and controlled corporations as well as local
governments to reduce their total expenditures by at least 25 percent along suggested areas
mentioned in AO 372.

Under existing law, local government units, in addition to having administrative autonomy in the
exercise of their functions, enjoy fiscal autonomy as well. Fiscal autonomy means that local
governments have the power to create their own sources of revenue in addition to their equitable
share in the national taxes released by the national government, as well as the power to allocate
their resources in accordance with their own priorities. It extends to the preparation of their
budgets, and local officials in turn-have to work within the constraints thereof. They are not
formulated at the national level and imposed on local governments, whether they are relevant to
local needs and resources or not. Hence, the necessity of a balancing of viewpoints and the
harmonization of proposals from both local and national officials, 24 who in any case are
partners in the attainment of national goals.

Local fiscal autonomy does not however rule out any manner of national government
intervention by way of supervision, in order to ensure that local programs, fiscal and otherwise,
are consistent with national goals. Significantly, the President, by constitutional fiat, is the head
of the economic and planning agency of the government, 25 primarily responsible for
formulating and implementing continuing, coordinated and integrated social and economic
policies, plans and programs 26 for the entire country. However, under the Constitution, the
formulation and the implementation of such policies and programs are subject to "consultations
with the appropriate public agencies, various private sectors, and local government units." The
President cannot do so unilaterally.

Consequently, the Local Government Code provides: 27

". . . [I]n the event the national government incurs an unmanaged public sector deficit, the
President of the Philippines is hereby authorized, upon the recommendation of [the] Secretary of
Finance, Secretary of the Interior and Local Government and Secretary of Budget and
Management, and subject to consultation with the presiding officers of both Houses of Congress
and the presidents of the liga, to make the necessary adjustments in the internal revenue
allotment of local government units but in no case shall the allotment be less than thirty percent
(30%) of the collection of national internal revenue taxes of the third fiscal year preceding the
current fiscal year . . ."
cralaw virtua1aw library

There are therefore several requisites before the President may interfere in local fiscal matters:
(1) an unmanaged public sector deficit of the national government; (2) consultations with the
presiding officers of the Senate and the House of Representatives and the presidents of the
various local leagues; and (3) the corresponding recommendation of the secretaries of the
Department of Finance, Interior and Local Government, and Budget and Management.
Furthermore, any adjustment in the allotment shall in no case be less than thirty percent (30%) of
the collection of national internal revenue taxes of the third fiscal year preceding the current one.

Petitioner points out that respondents failed to comply with these requisites before the issuance
and the implementation of AO 372. At the very least, they did not even try to show that the
national government was suffering from an unmanageable public sector deficit. Neither did they
claim having conducted consultations with the different leagues of local governments. Without
these requisites, the President has no authority to adjust, much less to reduce, unilaterally the
LGU’s internal revenue allotment.

The solicitor general insists, however, that AO 372 is merely directory and has been issued by
the President consistent with his power of supervision over local governments. It is intended only
to advise all government agencies and instrumentalities to undertake cost-reduction measures
that will help maintain economic stability in the country, which is facing economic difficulties.
Besides, it does not contain any sanction in case of noncompliance. Being merely an advisory,
therefore, Section 1 of AO 372 is well within the powers of the President. Since it is not a
mandatory imposition, the directive cannot be characterized as an exercise of the power of
control.

While the wordings of Section 1 of AO 372 have a rather commanding tone, and while we agree
with petitioner that the requirements of Section 284 of the Local Government Code have not
been satisfied, we are prepared to accept the solicitor general’s assurance that the directive to
"identify and implement measures . . . that will reduce total expenditures . . . by at least 25% of
authorized regular appropriation" is merely advisory in character, and does not constitute a
mandatory or binding order that interferes with local autonomy. The language used, while
authoritative, does not amount to a command that emanates from a boss to a subaltern.

Rather, the provision is merely an advisory to prevail upon local executives to recognize the need
for fiscal restraint in a period of economic difficulty. Indeed, all concerned would do well to
heed the President’s call to unity, solidarity and teamwork to help alleviate the crisis. It is
understood, however, that no legal sanction may be imposed upon LGUs and their officials who
do not follow such advice. It is in this light that we sustain the solicitor general’s contention in
regard to Section 1.
Withholding a Part

of LGUs’ IRA

Section 4 of AO 372 cannot, however, be upheld. A basic feature of local fiscal autonomy is the
automatic release of the shares of LGUs in the national internal revenue. This is mandated by no
less than the Constitution. 28 The Local Government Code 29 specifies further that the release
shall be made directly to the LGU concerned within five (5) days after every quarter of the year
and "shall not be subject to any lien or holdback that may be imposed by the national
government for whatever purpose." 30 As a rule, the term "shall" is a word of command that
must be given a compulsory meaning. 31 The provision is, therefore, imperative. chanrobles.com : virtual law library

Section 4 of AO 372, however, orders the withholding, effective January 1, 1998, of 10 percent
of the LGUs’ IRA "pending the assessment and evaluation by the Development Budget
Coordinating Committee of the emerging fiscal situation" in the country. Such withholding
clearly contravenes the Constitution and the law. Although temporary, it is equivalent to a
holdbacks which means "something held back or withheld, often temporarily." 32 Hence, the
"temporary" nature of the retention by the national government does not matter. Any retention is
prohibited.

In sum, while Section 1 of AO 372 may be upheld as an advisory effected in times of national
crisis, Section 4 thereof has no color of validity at all. The latter provision effectively encroaches
on the fiscal autonomy of local governments. Concededly, the President was well-intentioned in
issuing his Order to withhold the LGUs’ IRA, but the rule of law requires that even the best
intentions must be carried out within the parameters of the Constitution and the law. Verily,
laudable purposes must be carried out by legal methods.

Refutation of Justice Kapunan’s Dissent

Mr. Justice Santiago M. Kapunan dissents from our Decision on the grounds that, allegedly, (1)
the Petition is premature; (2) AO 372 falls within the powers of the President as chief fiscal
officer; and (3) the withholding of the LGUs’ IRA is implied in the President’s authority to
adjust it in case of an unmanageable public sector deficit.

First, on prematurity. According to the Dissent, when "the conduct has not yet occurred and the
challenged construction has not yet been adopted by the agency charged with administering the
administrative order, the determination of the scope and constitutionality of the executive action
in advance of its immediate adverse effect involves too remote and abstract an inquiry for the
proper exercise of judicial function."cralaw virtua1aw library

This is a rather novel theory — that people should await the implementing evil to befall on them
before they can question acts that are illegal or unconstitutional. Be it remembered that the real
issue here is whether the Constitution and the law are contravened by Section 4 of AO 372, not
whether they are violated by the acts implementing it. In the unanimous en banc case Tañada v.
Angara, 33 this Court held that when an act of the legislative department is seriously alleged to
have infringed the Constitution, settling the controversy becomes the duty of this Court. By the
mere enactment of the questioned law or the approval of the challenged action, the dispute is said
to have ripened into a judicial controversy even without any other overt act. Indeed, even a
singular violation of the Constitution and/or the law is enough to awaken judicial duty. Said the
Court:jgc:chanrobles.com.ph

"In seeking to nullify an act of the Philippine Senate on the ground that it contravenes the
Constitution, the petition no doubt raises a justiciable controversy. Where an action of the
legislative branch is seriously alleged to have infringed the Constitution, it becomes not only the
right but in fact the duty of the judiciary to settle the dispute. The question thus posed is judicial
rather than political. The duty (to adjudicate) remains to assure that the supremacy of the
Constitution is upheld.’ 34 Once a ‘controversy as to the application or interpretation of a
constitutional provision is raised before this Court . . ., it becomes a legal issue which the Court
is bound by constitutional mandate to decide.’ 35

x        x       x

"As this Court has repeatedly and firmly emphasized in many cases, 36 it will not shirk, digress
from or abandon its sacred duty and authority to uphold the Constitution in matters that involve
grave abuse of discretion brought before it in appropriate cases, committed by any officer,
agency, instrumentality or department of the government." cralaw virtua1aw library

In the same vein, the Court also held in Tatad v. Secretary of the Department of Energy: 37

". . . Judicial power includes not only the duty of the courts to settle actual controversies
involving rights which are legally demandable and enforceable, but also the duty to determine
whether or not there has been grave abuse of discretion amounting to lack or excess of
jurisdiction on the part of any branch or instrumentality of government. The courts, as guardians
of the Constitution, have the inherent authority to determine whether a statute enacted by the
legislature transcends the limit imposed by the fundamental law. Where the statute violates the
Constitution, it is not only the right but the duty of the judiciary to declare such act
unconstitutional and void." cralaw virtua1aw library

By the same token, when an act of the President, who in our constitutional scheme is a coequal
of Congress, is seriously alleged to have infringed the Constitution and the laws, as in the present
case, settling the dispute becomes the duty and the responsibility of the courts.

Besides, the issue that the Petition is premature has not been raised by the parties; hence it is
deemed waived. Considerations of due process really prevents its use against a party that has not
been given sufficient notice of its presentation, and thus has not been given the opportunity to
refute it. 38

Second, on the President’s power as chief fiscal officer of the country. Justice Kapunan posits
that Section 4 of AO 372 conforms with the President’s role as chief fiscal officer, who allegedly
"is clothed by law with certain powers to ensure the observance of safeguards and auditing
requirements, as well as the legal prerequisites in the release and use of IRAs, taking into
account the constitutional and statutory mandates." 39 He cites instances when the President may
lawfully intervene in the fiscal affairs of LGUs.

Precisely, such powers referred to in the Dissent have specifically been authorized by law and
have not been challenged as violative of the Constitution. On the other hand, Section 4 of AO
372, as explained earlier, contravenes explicit provisions of the Local Government Code (LGC)
and the Constitution. In other words, the acts alluded to in the Dissent are indeed authorized by
law; but, quite the opposite, Section 4 of AO 372 is bereft of any legal or constitutional basis.

Third, on the President’s authority to adjust the RA of LGUs in case of an unmanageable public
sector deficit. It must be emphasized that in striking down Section 4 of AO 372, this Court is not
ruling out any form of reduction in the IRAs of LGUs. Indeed, as the President may make
necessary adjustments in case of an unmanageable public sector deficit, as stated in the main part
of this Decision, and in line with Section 284 of the LGC which Justice Kapunan cites. He,
however, merely glances over a specific requirement in the same provision — that such
reduction is subject to consultation with the presiding officers of both Houses of Congress and,
more importantly, with the presidents of the leagues of local governments.

Notably, Justice Kapunan recognizes the need for "interaction between the national government
and the LGUs at the planning level," in order to ensure that "local development plans . . . hew to
national policies and standards." The problem is that no such interaction or consultation was ever
held prior to the issuance of AO 372. This is why the petitioner and the intervenor (who was a
provincial governor and at the same time president of the League of Provinces of the Philippines
and chairman of the League of Leagues of Local Governments) have protested and instituted this
action. Significantly, respondents do not deny the lack of consultation.

In addition, Justice Kapunan cites Section 287 40 of the LGC as impliedly authorizing the
President to withhold the IRA of an LGU, pending its compliance with certain requirements.
Even a cursory reading of the provision reveals that it is totally inapplicable to the issue at bar. It
directs LGUs to appropriate in their annual budgets 20 percent of their respective IRAs for
development projects. It speaks of no positive power granted the President to priorly withhold
any amount. Not at all.

WHEREFORE, the Petition is GRANTED. Respondents and their successors are hereby
permanently PROHIBITED from implementing Administrative Order Nos. 372 and 43,
respectively dated December 27, 1997 and December 10, 1998, insofar as local government units
are concerned.

SO ORDERED.

Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Mendoza, Quisumbing, Pardo, Buena, Gonzaga-
Reyes and De Leon, Jr., JJ., concur.

Separate Opinions

KAPUNAN, J., dissenting: chanrob1es virtual 1aw library

In striking down as unconstitutional and illegal Section 4 of Administrative Order No. 372 ("AO
No. 372"), the majority opinion posits that the President exercised power of control over the
local government units ("LGU"), which he does not have, and violated the provisions of Section
6, Article X of the Constitution, which states: chanrob1es virtual 1aw library

SECTION 6. Local government units shall have a just share, as determined by law, in the
national taxes which shall be automatically released to them.

and Section 286(a) of the Local Government Code, which provides: chanrob1es virtual 1aw library

SECTION 286. Automatic Release of Shares. — (a) The share of each local government unit
shall be released, without need of any further action, directly to the provincial, city, municipal or
barangay treasurer, as the case may be, on a quarterly basis within five (5) days after the end of
each quarter, and which shall not be subject to any lien or holdback that may be imposed by the
national government for whatever purpose.

The share of the LGUs in the national internal revenue taxes is defined in Section 284 of the
same Local Government Code, to wit: chanrob1es virtual 1aw library

SECTION 284. Allotment of Internal Revenue Taxes. — Local government units shall have a
share in the national internal revenue taxes based on the collection of the third fiscal year
preceding the current fiscal year as follows: chanrob1es virtual 1aw library

(a) On the first year of the effectivity of this Code, thirty percent (30%);

(b) On the second year, thirty-five (35%) percent; and

(c) On the third year and thereafter, forty percent (40%).

Provided, That in the event that the national government incurs an unmanageable public sector
deficit, the President of the Philippines is hereby authorized, upon the recommendation of
Secretary of Finance, Secretary of Interior and Local Government and Secretary of Budget and
Management, and subject to consultation with the presiding officers of both Houses of Congress
and the presidents of the "liga," to make the necessary adjustments in the internal revenue
allotment of local government units but in no case shall the allotment be less than thirty percent
(30%) of the collection of national internal revenue taxes of the third fiscal year preceding the
current fiscal year: Provided, further, That in the first year of the effectivity of this Code, the
local government units shall, in addition to the thirty percent (30%) internal revenue allotment
which shall include the cost of devolved functions for essential public services, be entitled to
receive the amount equivalent to the cost of devolved personal services.

x        x       x

The majority opinion takes the view that the withholding of ten percent (10%) of the internal
revenue allotment ("IRA") to the LGUs pending the assessment and evaluation by the
Development Budget Coordinating Committee of the emerging fiscal situation as called for in
Section 4 of AO No. 372 transgresses against the above-quoted provisions which mandate the
"automatic" release of the shares of the LGUs in the national internal revenue in consonance with
local fiscal autonomy. The pertinent portions of AO No. 372 are reproduced hereunder: chanrob1es virtual 1aw library

ADMINISTRATIVE ORDER NO. 372

ADOPTION OF ECONOMY MEASURES IN GOVERNMENT FOR FY 1998

WHEREAS, the current economic difficulties brought about by the peso depreciation requires
continued prudence in government fiscal management to maintain economic stability and sustain
the country’s growth momentum;

WHEREAS, it is imperative that all government agencies adopt cash management measures to
match expenditures with available resources; NOW THEREFORE, I, FIDEL V. RAMOS,
President of the Republic of the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby order and direct:
chanrob1es virtual 1aw library

SECTION 1. All government departments and agencies, including . . . local government units
will identify and implement measures in FY 1998 that will reduce total appropriations for non-
personal services items, along the following suggested areas: chanrob1es virtual 1aw library

x        x       x

SECTION 4. Pending the assessment and evaluation by the Development Budget Coordinating
Committee of the emerging fiscal situation, the amount equivalent to 10% of the internal revenue
allotment to local government units shall be withheld.

x        x       x

Subsequently, on December 10, 1998, President Joseph E. Estrada issued Administrative Order
No. 43 ("AO No. 43"), amending Section 4 of AO No. 372, by reducing to five percent (5%) the
IRA to be withheld from the LGUs, thus: chanrob1es virtual 1aw library

ADMINISTRATIVE ORDER NO. 43

AMENDING ADMINISTRATIVE ORDER NO. 372 DATED 27 DECEMBER 1997

ENTITLED "ADOPTION OF ECONOMY MEASURES IN GOVERNMENT FOR FY 1998"

WHEREAS, Administrative Order No. 372 dated 27 December 1997 entitled "Adoption of
Economy Measures in Government for FY 1998" was issued to address the economic difficulties
brought about by the peso devaluation in 1997;

WHEREAS, Section 4 of Administrative Order No. 372 provided that the amount equivalent to
10% of the internal revenue allotment to local government units shall be withheld; and,
WHEREAS, there is a need to release additional funds to local government units for vital
projects and expenditures.

NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA President of the Republic of the

Philippines, by virtue of the powers vested in me by law, do hereby order the reduction of the
withheld Internal Revenue Allotment (IRA) of local government units from ten percent to five
percent.

The five percent reduction in the IRA withheld for 1998 shall be released before 25 December
1998.

DONE in the City of Manila, this 10th day of December, in the year of our Lord, nineteen
hundred and ninety eight.

With all due respect, I beg to disagree with the majority opinion.

Section 4 of AO No. 372 does not present a case ripe for adjudication. The language of Section 4
does not conclusively show that, on its face, the constitutional provision on the automatic release
of the IRA shares of the LGUs has been violated. Section 4, as worded, expresses the idea that
the withholding is merely temporary which fact alone would not merit an outright conclusion of
its unconstitutionality, especially in light of the reasonable presumption that administrative
agencies act in conformity with the law and the Constitution. Where the conduct has not yet
occurred and the challenged construction has not yet been adopted by the agency charged with
administering the administrative order, the determination of the scope and constitutionality of the
executive action in advance of its immediate adverse effect involves too remote and abstract an
inquiry for the proper exercise of judicial function. Petitioners have not shown that the alleged
5% IRA share of LGUs that was temporarily withheld has not yet been released, or that the
Department of Budget and Management (DBM) has refused and continues to refuse its release.
In view thereof, the Court should not decide as this case suggests an abstract proposition on
constitutional issues.

The President is the chief fiscal officer of the country. He is ultimately responsible for the
collection and distribution of public money: chanrob1es virtual 1aw library

SECTION 3. Powers and Functions. — The Department of Budget and Management shall assist
the President in the preparation of a national resources and expenditures budget, preparation,
execution and control of the National Budget, preparation and maintenance of accounting
systems essential to the budgetary process, achievement of more economy and efficiency in the
management of government operations, administration of compensation and position
classification systems, assessment of organizational effectiveness and review and evaluation of
legislative proposals having budgetary or organizational implications. 1

In a larger context, his role as chief fiscal officer is directed towards "the nation’s efforts at
economic and social upliftment 2 for which more specific economic powers are delegated.
Within statutory limits, the President can, thus, fix "tariff rates, import and export quotas,
tonnage and wharfage dues, and other duties or imposts within the framework of the national
development program of the government," 3 as he is also responsible for enlisting the country in
international economic agreements. 4 More than this, to achieve "economy and efficiency in the
management of government operations," the President is empowered to create appropriation
reserves, 5 suspend expenditure appropriations, 6 and institute cost reduction schemes. 7

As chief fiscal officer of the country, the President supervises fiscal development in the local
government units and ensures that laws are faithfully executed. 8 For this reason, he can set aside
tax ordinances if he finds them contrary to the Local Government Code. 9 Ordinances cannot
contravene statutes and public policy as declared by the national government. 10 The goal of
local economy is not to "end the relation of partnership and inter-dependence between the central
administration and local government units," 11 but to make local governments "more responsive
and accountable" [to] "ensure their fullest development as self-reliant communities and make
them more effective partners in the pursuit of national development and social progress." 12

The interaction between the national government and the local government units is mandatory at
the planning level. Local development plans must thus hew to "national policies and standards"
13 as these are integrated into the regional development plans for submission to the National
Economic Development Authority." 14 Local budget plans and goals must also be harmonized,
as far as practicable, with "national development goals and strategies in order to optimize the
utilization of resources and to avoid duplication in the use of fiscal and physical resources." 15

Section 4 of AO No. 372 was issued in the exercise by the President not only of his power of
general supervision, but also in conformity with his role as chief fiscal officer of the country in
the discharge of which he is clothed by law with certain powers to ensure the observance of
safeguards and auditing requirements, as well as the legal prerequisites in the release and use of
IRAs, taking into account the constitutional 16 and statutory 17 mandates.

However, the phrase "automatic release" of the LGUs’ shares does not mean that the release of
the funds is mechanical, spontaneous, self-operating or reflex. IRAs must first be determined,
and the money for their payment collected. 18 In this regard, administrative documentations are
also undertaken to ascertain their availability, limits and extent. The phrase, thus, should be used
in the context of the whole budgetary process and in relation to pertinent laws relating to audit
and accounting requirements. In the workings of the budget for the fiscal year, appropriations for
expenditures are supported by existing funds in the national coffers and by proposals for revenue
raising. The money, therefore, available for IRA release may not be existing but merely inchoate,
or a mere expectation. It is not infrequent that the Executive Department’s proposals for raising
revenue in the form of proposed legislation may not be passed by the legislature. As such, the
release of IRA should not mean release of absolute amounts based merely on mathematical
computations. There must be a prior determination of what exact amount the local government
units are actually entitled in light of the economic factors which affect the fiscal situation in the
country. Foremost of these is where, due to an unmanageable public sector deficit, the President
may make the necessary adjustments in the IRA of LGUs. Thus, as expressly provided in Article
284 of the Local Government Code: chanrob1es virtual 1aw library

. . . (I)n the event that the national government incurs an unmanageable public sector deficit, the
President of the Philippines is hereby authorized, upon the recommendation of Secretary of
Finance, Secretary of Interior and Local Government and Secretary of Budget and Management,
and subject to consultation with the presiding officers of both Houses of Congress and the
presidents of the "liga," to make the necessary adjustments in the internal revenue allotment of
local government units but in no case shall the allotment be less than thirty percent (30%) of the
collection of national internal revenue taxes of the third fiscal year preceding the current fiscal
year. . .

Under the aforecited provision, if facts reveal that the economy has sustained or will likely
sustain such "unmanageable public sector deficit," then the LGUs cannot assert absolute right of
entitlement to the full amount of forty percent (40%) share in the IRA, because the President is
authorized to make an adjustment and to reduce the amount to not less than thirty percent (30%).
It is, therefore, impractical to immediately release the full amount of the IRAs and subsequently
require the local government units to return at most ten percent (10%) once the President has
ascertained that there exists an unmanageable public sector deficit.

By necessary implication, the power to make necessary adjustments (including reduction) in the
IRA in case of an unmanageable public sector deficit, includes the discretion to withhold the
IRAs temporarily until such time that the determination of the actual fiscal situation is made. The
test in determining whether one power is necessarily included in a stated authority is: "The
exercise of a more absolute power necessarily includes the lesser power especially where it is
needed to make the first power effective." 19 If the discretion to suspend temporarily the release
of the IRA pending such examination is withheld from the President, his authority to make the
necessary IRA adjustments brought about by the unmanageable public sector deficit would be
emasculated in the midst of serious economic crisis. In the situation conjured by the majority
opinion, the money would already have been gone even before it is determined that fiscal crisis
is indeed happening.

The majority opinion overstates the requirement in Section 286 of the Local Government Code
that the IRAs "shall not be subject to any lien or holdback that may be imposed by the national
government for whatever purpose" as proof that no withholding of the release of the IRAs is
allowed albeit temporary in nature.

It is worthy to note that this provision does not appear in the Constitution. Section 6, Art X of the
Constitution merely directs that LGUs "shall have a just share" in the national taxes "as
determined by law" and which share "shall be automatically released to them." This means that
before the LGUs’ share is released, there should be first a determination, which requires a
process, of what is the correct amount as dictated by existing laws. For one, the Implementing
Rules of the Local Government Code allows deductions from the IRAs, to wit: chanrob1es virtual 1aw library

Article 384. Automatic Release of IRA Shares of LGUs: chanrob1es virtual 1aw library

x        x       x

(c) The IRA share of LGUs shall not be subject to any lien or hold back that may be imposed by
the National Government for whatever purpose unless otherwise provided in the Code or other
applicable laws and loan contract on project agreements arising from foreign loans and
international commitments, such as premium contributions of LGUs to the Government Service
Insurance System and loans contracted by LGUS under foreign-assisted projects.

Apart from the above, other mandatory deductions are made from the IRAs prior to their release,
such as: (1) total actual cost of devolution and the cost of city-funded hospitals; 20 and (2)
compulsory contributions 21 and other remittances. 22 It follows, therefore, that the President
can withhold portions of IRAs in order to set-off or compensate legitimately incurred obligations
and remittances of LGUs.

Significantly, Section 286 of the Local Government Code does not make mention of the exact
amount that should be automatically released to the LGUs. The provision does not mandate that
the entire 40% share mentioned in Section 284 shall be released. It merely provides that the
"share" of each LGU shall be released and which "shall not be subject to any lien or holdback
that may be imposed by the national government for whatever purpose." The provision on
automatic release of IRA share should, thus, be read together with Section 284, including the
proviso on adjustment or reduction of IRAs, as well as other relevant laws. It may happen that
the share of the LGUs may amount to the full forty percent (40%) or the reduced amount of
thirty percent (30%) as adjusted without any law being violated. In other words, all that Section
286 requires is the automatic release of the amount that the LGUs are rightfully and legally
entitled to, which, as the same section provides, should not be less than thirty percent (30%) of
the collection of the national revenue taxes. So that even if five percent (5%) or ten percent
(10%) is either temporarily or permanently withheld, but the minimum of thirty percent (30%)
allotment for the LGUs is released pursuant to the President’s authority to make the necessary
adjustment in the LGUs’ share, there is still full compliance with the requirements of the
automatic release of the LGUs’ share.

Finally, the majority insists that the withholding of ten percent (10%) or five percent (5%) of the
IRAs could not have been done pursuant to the power of the President to adjust or reduce such
shares under Section 284 of the Local Government Code because there was no showing of an
unmanageable public sector deficit by the national government, nor was there evidence that
consultations with the presiding officers of both Houses of Congress and the presidents of the
various leagues had taken place and the corresponding recommendations of the Secretary of
Finance, Secretary of Interior and Local Government and the Budget Secretary were made. chanroblesvirtuallawlibrary

I beg to differ. The power to determine whether there is an unmanageable public sector deficit is
lodged in the President. The President’s determination, as fiscal manager of the country, of the
existence of economic difficulties which could amount to "unmanageable public sector deficit"
should be accorded respect. In fact, the withholding of the ten percent (10%) of the LGUs’ share
was further justified by the current economic difficulties brought about by the peso depreciation
as shown by one of the "WHEREASES" of AO No. 372. 23 In the absence of any showing to the
contrary, it is presumed that the President had made prior consultations with the officials thus
mentioned and had acted upon the recommendations of the Secretaries of finance, Interior and
Local Government and Budget. 24

Therefore, even assuming hypothetically that there was effectively a deduction of five percent
(5%) of the LGUs’ share, which was in accordance with the President’s prerogative in view of
the pronouncement of the existence of an unmanageable public sector deficit, the deduction
would still be valid in the absence of any proof that the LGUs’ allotment was less than the thirty
percent (30%) limit provided for in Section 284 of the Local Government Code.

In resumé, the withholding of the amount equivalent to five percent (5%) of the IRA to the LGUs
was temporary pending determination by the Executive of the actual share which the LGUs are
rightfully entitled to on the basis of the applicable laws, particularly Section 284 of the Local
Government Code, authorizing the President to make the necessary adjustments in the IRA of
LGUs in the event of an unmanageable public sector deficit. And assuming that the said five
percent (5%) of the IRA pertaining to the 1998 Fiscal Year has been permanently withheld, there
is no showing that the amount actually released to the LGUs that same year was less than thirty
percent (30%) of the national internal revenue taxes collected, without even considering the
proper deductions allowed by law.

WHEREFORE, I vote to DISMISS the petition.

[G.R. No. 118295. May 2, 1997.]

WIGBERTO E. TAÑADA and ANNA DOMINIQUE COSETENG, as members of the Philippine Senate and
as taxpayers; GREGORIO ANDOLANA and JOKER ARROYO as members of the House of Representatives
and as taxpayers; NICANOR P. PERLAS and HORACIO R. MORALES, both as taxpayers: CIVIL LIBERTIES
UNION, NATIONAL ECONOMIC PROTECTIONISM ASSOCIATION, CENTER FOR ALTERNATIVE
DEVELOPMENT INITIATIVES, LIKAS-KAYANG KAUNLARAN FOUNDATION, INC., PHILIPPINE RURAL
RECONSTRUCTION MOVEMENT, DEMOKRATIKONG KILUSAN NG MAGBUBUKID NG PILIPINAS, INC.,
and PHILIPPINE PEASANT INSTITUTE, in representation of various taxpayers and as non-governmental
organizations, Petitioners, v. EDGARDO ANGARA, ALBERTO ROMULO, LETICIA RAMOS-SHAHANI,
HEHERSON ALVAREZ, AGAPITO AQUINO, RODOLFO BIAZON, NEPTALI GONZALES, ERNESTO HERRERA,
JOSE LINA, GLORIA MACAPAGAL-ARROYO, ORLANDO MERCADO, BLAS OPLE, JOHN OSMEÑA,
SANTANINA RASUL, RAMON REVILLA, RAUL ROCO, FRANCISCO TATAD and FREDDIE WEBB, in their
respective capacities as members of the Philippine Senate who concurred in the ratification by the
President of the Philippines of the Agreement Establishing the World Trade Organization; SALVADOR
ENRIQUEZ, in his capacity as Secretary of Budget and Management; CARIDAD VALDEHUESA, in her
capacity as National Treasurer; RIZALINO NAVARRO, in his capacity as Secretary of Trade and Industry;
ROBERTO SEBASTIAN, in his capacity as Secretary of Agriculture; ROBERTO DE OCAMPO, in his
capacity as Secretary of Finance; ROBERTO ROMULO, in his capacity as Secretary of Foreign Affairs;
and TEOFISTO T. GUINGONA, in his capacity as Executive Secretary, Respondents.

SYLLABUS

1. REMEDIAL LAW; ACTIONS; ESTOPPEL, SUBJECT TO WAIVER. — The matter of

estoppel will not be taken up because this defense is waivable and the respondents have
effectively, waived it by not pursuing it in any of their pleadings; in any event, this issue, even if
ruled in respondents’ favor, will not cause the petition’s dismissal as there are petitioners other
than the two senators, who are not vulnerable to the defense of estoppel.

2. ID.; ID.; PARTIES; LOCUS PROBANDI; SUBJECT TO WAIVER. — During its

deliberations on the case, the Court noted that the respondents did not question the locus standi
of petitioners. Hence, they are also deemed to have waived the benefit of such issue. They
probably realized that grave constitutional issues, expenditures of public funds and serious
international commitments of the nation are involved here, and that transcendental public interest
requires that the substantive issues be met head on and decided on the merits, rather than skirted
or deflected by procedural matters.

3. ID.; ID.; PETITION SEEKING TO NULLIFY ACT OF SENATE ON GROUND THAT IT

CONTRAVENES THE CONSTITUTION, A JUSTICIABLE QUESTION. — In seeking to
nullify an act of the Philippine Senate on the ground that it contravenes the Constitution, the
petition no doubt raises a justiciable controversy. Where an action of the legislative branch is
seriously alleged to have infringed the Constitution, it becomes not only the right but in fact the
duty of the judiciary to settle the dispute. "The question thus posed is judicial rather than
political. The duty (to adjudicate) remains to assure that the supremacy of the Constitution is
upheld." Once a "controversy as to the application or interpretation of a constitutional provision
is raised before this Court (as in the instant case), it becomes a legal issue which the Court is
bound by constitutional mandate to decide." cralaw virtua1aw library

4. ID.; SUPREME COURT; JUDICIAL POWER; SCOPE. — The jurisdiction of this Court to
adjudicate the matters raised in the petition is clearly set out in the 1987 Constitution, as follows:
"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." The foregoing text emphasizes the judicial
department’s duty and power to strike down grave abuse of discretion on the part of any branch
or instrumentality, of government including Congress. It is an innovation in our political law. As
explained by former Chief Justice Roberto Concepcion, "the judiciary is the final arbiter on the
question of whether or not a branch of government or any of its officials has acted without
jurisdiction or in excess of jurisdiction or so capriciously, as to constitute an abuse of discretion
amounting to excess of jurisdiction. This is not only a judicial power but a duty to pass judgment
on matters of this nature." As this Court has repeatedly and firmly emphasized in many cases, it
will not shirk, digress from or abandon its sacred duty and authority to uphold the Constitution in
matters that involve grave abuse of discretion brought before it in appropriate cases, committed
by any officer, agency, instrumentality or department of the government.

5. ID.; SPECIAL CIVIL ACTIONS; CERTIORARI, PROHIBITION AND MANDAMUS;

APPROPRIATE REMEDIES TO REVIEW ACTS OF LEGISLATIVE AND EXECUTIVE
OFFICIALS. — Certiorari, prohibition and mandamus are appropriate remedies to raise
constitutional issues and to review and/or prohibit/nullify, when proper, acts of legislative and
executive officials.

6. POLITICAL LAW; CONSTITUTION; DECLARATION OF PRINCIPLES AND STATE

POLICIES; AIDS OR GUIDES IN THE EXERCISE OF JUDICIAL AND LEGISLATIVE
POWERS. — By its very title, Article II of the Constitution is a "declaration of principles and
state policies." The counterpart of this article in the 1935 Constitution is called the "basic
political creed of the nation" by Dean Vicente Sinco. These principles in Article II are not
intended to be self-executing principles ready for enforcement through the courts. They are used
by the judiciary as aids or as guides in the exercise of its power of judicial review, and by the
legislature in its enactment of laws. As held in the leading case of Kilosbayan, Incorporated v.
Morato, the principles and state policies enumerated in Article II and some sections of Article
XII are not "self-executing provisions, the disregard of which can give rise to a cause of action in
the courts. They do not embody judicially enforceable constitutional rights but guidelines for
legislation."
DECISION

PANGANIBAN, J.:

The emergence on January 1, 1995 of the World Trade Organization, abetted by the membership
thereto of the vast majority of countries, has revolutionized international business and economic
relations amongst states. It has irreversibly propelled the world towards trade liberalization and
economic globalization. Liberalization, globalization, deregulation and privatization, the third-
millennium buzz words, are ushering in a new borderless world of business by sweeping away as
mere historical relics the heretofore traditional modes of promoting and protecting national
economies like tariffs, export subsidies, import quotas, quantitative restrictions, tax exemptions
and currency controls. Finding market niches and becoming the best in specific industries in a
market-driven and export-oriented global scenario are replacing age-old "beggar-thy-neighbor"
policies that unilaterally protect weak and inefficient domestic producers of goods and services.
In the words of Peter Drucker, the well-known management guru, "Increased participation in the
world economy has become the key to domestic economic growth and prosperity." chanrobles.com : virtual law library

Brief Historical Background

To hasten worldwide recovery from the devastation wrought by the Second World War, plans for
the establishment of three multilateral institutions — inspired by that grand political body, the
United Nations — were discussed at Dumbarton Oaks and Bretton Woods. The first was the
World Bank (WB) which was to address the rehabilitation and reconstruction of war-ravaged and
later developing countries; the second, the International Monetary Fund (IMF) which was to deal
with currency problems; and the third, the International Trade Organization (ITO), which was to
foster order and predictability in world trade and to minimize unilateral protectionist policies that
invite challenge, even retaliation, from other states. However, for a variety of reasons, including
its non-ratification by the United States, the ITO, unlike the IMF and WB, never took off. What
remained was only GATT — the General Agreement on Tariffs and Trade. GATT was a
collection of treaties governing access to the economies of treaty adherents with no
institutionalized body administering the agreements or dependable system of dispute settlement.

After half a century and several dizzying rounds of negotiations, principally the Kennedy Round,
the Tokyo Round and the Uruguay Round, the world finally gave birth to that administering
body — the World Trade Organization — with the signing of the "Final Act" in Marrakesh,
Morocco and the ratification of the WTO Agreement by its members. 1 1a 1b 1c

Like many other developing countries, the Philippines joined WTO as a founding member with
the goal, as articulated by President Fidel V. Ramos in two letters to the Senate (infra), of
improving "Philippine access to foreign markets, especially its major trading partners, through
the reduction of tariffs on its exports, particularly agricultural and industrial products." The
President also saw in the WTO the opening of "new opportunities for the services sector . . ., (the
reduction of) costs and uncertainty associated with exporting . . ., and (the attraction of) more
investments into the country." Although the Chief Executive did not expressly mention it in his
letter, the Philippines — and this is of special interest to the legal profession — will benefit from
the WTO system of dispute settlement by judicial adjudication through the independent WTO
settlement bodies called (1) Dispute Settlement Panels and (2) Appellate Tribunal. Heretofore,
trade disputes were settled mainly through negotiations where solutions were arrived at
frequently on the basis of relative bargaining strengths, and where naturally, weak and
underdeveloped countries were at a disadvantage.

The Petition in Brief

Arguing mainly (1) that the WTO requires the Philippines "to place nationals and products of
member-countries on the same footing as Filipinos and local products" and (2) that the WTO
"intrudes, limits and/or impairs" the constitutional powers of both Congress and the Supreme
Court, the instant petition before this Court assails the WTO Agreement for violating the
mandate of the 1987 Constitution to "develop a self-reliant and independent national economy
effectively controlled by Filipinos . . . (to) give preference to qualified Filipinos (and to) promote
the preferential use of Filipino labor, domestic materials and locally produced goods." cralaw virtua1aw library

Simply stated, does the Philippine Constitution prohibit Philippine participation in worldwide
trade liberalization and economic globalization? Does it proscribe Philippine integration into a
global economy that is liberalized, deregulated and privatized? These are the main questions
raised in this petition for certiorari, prohibition and mandamus under Rule 65 of the Rules of
Court praying (1) for the nullification, on constitutional grounds, of the concurrence of the
Philippine Senate in the ratification by the President of the Philippines of the Agreement
Establishing the World Trade Organization (WTO Agreement, for brevity) and (2) for the
prohibition of its implementation and enforcement through the release and utilization of public
funds, the assignment of public officials and employees, as well as the use of government
properties and resources by respondent-heads of various executive offices concerned therewith.
This concurrence is embodied in Senate Resolution No. 97, dated December 14, 1994.

The Facts

On April 15, 1994, Respondent Rizalino Navarro, then Secretary of the Department of Trade and
Industry (Secretary Navarro, for brevity), representing the Government of the Republic of the
Philippines, signed in Marrakesh, Morocco, the Final Act Embodying the Results of the Uruguay
Round of Multilateral Negotiations (Final Act, for brevity).

By signing the Final Act, 2 Secretary Navarro on behalf of the Republic of the Philippines,
agreed:jgc:chanrobles.com.ph

"(a) to submit, as appropriate, the WTO Agreement for the consideration of their respective
competent authorities, with a view to seeking approval of the Agreement in accordance with
their procedures; and

(b) to adopt the Ministerial Declarations and Decisions." cralaw virtua1aw library

On August 12, 1994, the members of the Philippine Senate received a letter dated August 11,
1994 from the President of the Philippines, 3 stating among others that "the Uruguay Round
Final Act is hereby submitted to the Senate for its concurrence pursuant to Section 21, Article
VII of the Constitution." cralaw virtua1aw library

On August 13, 1994, the members of the Philippine Senate received another letter from the
President of the Philippines 4 likewise dated August 11, 1994, which stated among others that
"the Uruguay Round Final Act, the Agreement Establishing the World Trade Organization, the
Ministerial Declarations and Decisions, and the Understanding on Commitments in Financial
Services are hereby submitted to the Senate for its concurrence pursuant to Section 21, Article
VII of the Constitution." cralaw virtua1aw library

On December 9, 1994, the President of the Philippines certified the necessity of the immediate
adoption of P.S. 1083, a resolution entitled "Concurring in the Ratification of the Agreement
Establishing the World Trade Organization." 5

On December 14, 1994, the Philippine Senate adopted Resolution No. 97 which "Resolved, as it
is hereby resolved, that the Senate concur, as it hereby concurs, in the ratification by the
President of the Philippines of the Agreement Establishing the World Trade Organization." 6
The text of the WTO Agreement is written on pages 137 et seq. of Volume I of the 36-volume
Uruguay Round of Multilateral Trade Negotiations and includes various agreements and
associated legal instruments (identified in the said Agreement as Annexes 1, 2 and 3 thereto and
collectively referred to as Multilateral Trade Agreements, for brevity) as follows:
jgc:chanrobles.com.ph

"ANNEX I

Annex 1A: Multilateral Agreement on Trade in Goods

General Agreement on Tariffs and Trade 1994

Agreement on Agriculture

Agreement on the Application of Sanitary and Phytosanitary

Measures

Agreement on Textiles and Clothing

Agreement on Technical Barriers to Trade

Agreement on Trade-Related Investment Measures

Agreement on Implementation of Article VI of the General

Agreement on Tariffs and Trade 1994

Agreement on Implementation of Article VII of the General

on Tariffs and Trade 1994

Agreement on Pre-Shipment Inspection

Agreement on Rules of Origin

Agreement on Imports Licensing Procedures

Agreement on Subsidies and Coordinating Measures

Agreement on Safeguards

Annex 1B: General Agreement on Trade in Services and Annexes

Annex 1C: Agreement on Trade-Related Aspects of Intellectual

Property Rights

ANNEX 2

Understanding on Rules and Procedures Governing the

Settlement of Disputes

ANNEX 3

Trade Policy Review Mechanism"

On December 16, 1994, the President of the Philippines signed 7 the Instrument of Ratification,
declaring:jgc:chanrobles.com.ph

"NOW THEREFORE, be it known that I, FIDEL V. RAMOS, President of the Republic of the
Philippines, after having seen and considered the aforementioned Agreement Establishing the
World Trade Organization and the agreements and associated legal instruments included in
Annexes one (1), two (2) and three (3) of that Agreement which are integral parts thereof, signed
at Marrakesh, Morocco on 15 April 1994, do hereby ratify and confirm the same and every
Article and Clause thereof." cralaw virtua1aw library

To emphasize, the WTO Agreement ratified by the President of the Philippines is composed of
the Agreement Proper and "the associated legal instruments included in Annexes one (1), two (2)
and three (3) of that Agreement which are integral parts thereof." cralaw virtua1aw library

On the other hand, the Final Act signed by Secretary Navarro embodies not only the WTO
Agreement (and its integral annexes aforementioned) but also (1) the Ministerial Declarations
and Decisions and (2) the Understanding on Commitments in Financial Services. In his
Memorandum dated May 13, 1996, 8 the Solicitor General describes these two latter documents
as follows: jgc:chanrobles.com.ph

"The Ministerial Decisions and Declarations are twenty-five declarations and decisions on a
wide range of matters, such as measures in favor of least developed countries, notification
procedures, relationship of WTO with the International Monetary Fund (IMF), and agreements
on technical barriers to trade and on dispute settlement.

The Understanding on Commitments in Financial Services dwell on, among other things,
standstill or limitations and qualifications of commitments to existing non-conforming measures,
market access, national treatment, and definitions of non-resident supplier of financial services,
commercial presence and new financial service." cdti

On December 29, 1994, the present petition was filed. After careful deliberation on respondents’
comment and petitioners’ reply thereto, the Court resolved on December 12, 1995, to give due
course to the petition, and the parties thereafter filed their respective memoranda. The Court also
requested the Honorable Lilia R. Bautista, the Philippine Ambassador to the United Nations
stationed in Geneva, Switzerland, to submit a paper, hereafter referred to as "Bautista Paper," 9
for brevity, (1) providing a historical background of and (2) summarizing the said agreements.

During the Oral Argument held on August 27, 1996, the Court directed: jgc:chanrobles.com.ph

"(a) the petitioners to submit the (1) Senate Committee Report on the matter in controversy and
(2) the transcript of proceedings/hearings in the Senate; and

(b) the Solicitor General, as counsel for respondents, to file (1) a list of Philippine treaties signed
prior to the Philippine adherence to the WTO Agreement, which derogate from Philippine
sovereignty and (2) copies of the multi-volume WTO Agreement and other documents
mentioned in the Final Act, as soon as possible." cralaw virtua1aw library

After receipt of the foregoing documents, the Court said it would consider the case submitted for
resolution. In a Compliance dated September 16, 1996, the Solicitor General submitted a printed
copy of the 36-volume Uruguay Round of Multilateral Trade Negotiations, and in another
Compliance dated October 24, 1996, he listed the various "bilateral or multilateral treaties or
international instruments involving derogation of Philippine sovereignty." Petitioners, on the
other hand, submitted their Compliance dated January 28, 1997, on January 30, 1997.

The Issues

In their Memorandum dated March 11, 1996, petitioners summarized the issues as follows: jgc:chanrobles.com.ph

"A. Whether the petition presents a political question or is otherwise not justiciable.

B. Whether the petitioner members of the Senate who participated in the deliberations and voting
leading to the concurrence are estopped from impugning the validity of the Agreement
Establishing the World Trade Organization or of the validity or of the concurrence.

C. Whether the provisions of the Agreement Establishing the World Trade Organization
contravene the provisions of Sec. 19, Article II, and Secs. 10 and 12, Article XII, all of the 1987
Philippine Constitution.

D. Whether provisions of the Agreement Establishing the World Trade Organization unduly
limit, restrict and impair Philippine sovereignty specifically the legislative power which, under
Sec. 2, Article VI, 1987 Philippine Constitution is ‘vested in the Congress of the Philippines’;
E. Whether provisions of the Agreement Establishing the World Trade Organization interfere
with the exercise of judicial power.

F. Whether the respondent members of the Senate acted in grave abuse of discretion amounting
to lack or excess of jurisdiction when they voted for concurrence in the ratification of the
constitutionally-infirm Agreement Establishing the World Trade Organization.

G. Whether the respondent members of the Senate acted in grave abuse of discretion amounting
to lack or excess of jurisdiction when they concurred only in the ratification of the Agreement
Establishing the World Trade Organization, and not with the Presidential submission which
included the Final Act, Ministerial Declaration and Decisions, and the Understanding on
Commitments in Financial Services." cralaw virtua1aw library

On the other hand, the Solicitor General as counsel for respondents "synthesized the several
issues raised by petitioners into the following" : 10

"1. Whether or not the provisions of the ‘Agreement Establishing the World Trade Organization
and the Agreements and Associated Legal Instruments included in Annexes one (1), two (2) and
three (3) of that agreement’ cited by petitioners directly contravene or undermine the letter, spirit
and intent of Section 19, Article II and Sections 10 and 12, Article XII of the 1987 Constitution.

2. Whether or not certain provisions of the Agreement unduly limit, restrict or impair the
exercise of legislative power by Congress.

3. Whether or not certain provisions of the Agreement impair the exercise of judicial power by
this Honorable Court in promulgating the rules of evidence.

4. Whether or not the concurrence of the Senate ‘in the ratification by the President of the
Philippines of the Agreement establishing the World Trade Organization’ implied rejection of
the treaty embodied in the Final Act." cralaw virtua1aw library

By raising and arguing only four issues against the seven presented by petitioners, the Solicitor
General has effectively ignored three, namely: (1) whether the petition presents a political
question or is otherwise not justiciable; (2) whether petitioner-members of the Senate (Wigberto
E. Tañada and Anna Dominique Coseteng) are estopped from joining this suit; and (3) whether
the respondent-members of the Senate acted in grave abuse of discretion when they voted for
concurrence in the ratification of the WTO Agreement. The foregoing notwithstanding, this
Court resolved to deal with these three issues thus: chanroblesvirtuallawlibrary

(1) The "political question" issue — being very fundamental and vital, and being a matter that
probes into the very jurisdiction of this Court to hear and decide this case — was deliberated
upon by the Court and will thus be ruled upon as the first issue;

(2) The matter of estoppel will not be taken up because this defense is waivable and the
respondents have effectively waived it by not pursuing it in any of their pleadings; in any event,
this issue, even if ruled in respondents’ favor, will not cause the petition’s dismissal as there are
petitioners other than the two senators, who are not vulnerable to the defense of estoppel; and

(3) The issue of alleged grave abuse of discretion on the part of the respondent senators will be
taken up as an integral part of the disposition of the four issues raised by the Solicitor General.

During its deliberations on the case, the Court noted that the respondents did not question the
locus standi of petitioners. Hence, they are also deemed to have waived the benefit of such issue.
They probably realized that grave constitutional issues, expenditures of public funds and serious
international commitments of the nation are involved here, and that transcendental public interest
requires that the substantive issues be met head on and decided on the merits, rather than skirted
or deflected by procedural matters. 11

To recapitulate, the issues that will be ruled upon shortly are: chanrob1es virtual 1aw library

(1) DOES THE PETITION PRESENT A JUSTICIABLE CONTROVERSY? OTHERWISE

STATED, DOES THE PETITION INVOLVE A POLITICAL QUESTION OVER WHICH
THIS COURT HAS NO JURISDICTION?

(2) DO THE PROVISIONS OF THE WTO AGREEMENT AND ITS THREE ANNEXES
CONTRAVENE SEC. 19, ARTICLE II, AND SECS. 10 AND 12, ARTICLE XII, OF THE
PHILIPPINE CONSTITUTION?

(3) DO THE PROVISIONS OF SAID AGREEMENT AND ITS ANNEXES LIMIT,

RESTRICT, OR IMPAIR THE EXERCISE OF LEGISLATIVE POWER BY CONGRESS?

(4) DO SAID PROVISIONS UNDULY IMPAIR OR INTERFERE WITH THE EXERCISE OF

JUDICIAL POWER BY THIS COURT IN PROMULGATING RULES ON EVIDENCE?

(5) WAS THE CONCURRENCE OF THE SENATE IN THE WTO AGREEMENT AND ITS
ANNEXES SUFFICIENT AND/OR VALID, CONSIDERING THAT IT DID NOT INCLUDE
THE FINAL ACT, MINISTERIAL DECLARATIONS AND DECISIONS, AND THE
UNDERSTANDING ON COMMITMENTS IN FINANCIAL SERVICES?

The First Issue: Does the Court Have Jurisdiction Over the Controversy?

In seeking to nullify an act of the Philippine Senate on the ground that it contravenes the
Constitution, the petition no doubt raises a justiciable controversy. Where an action of the
legislative branch is seriously alleged to have infringed the Constitution, it becomes not only the
right but in fact the duty of the judiciary to settle the dispute. "The question thus posed is judicial
rather than political. The duty (to adjudicate) remains to assure that the supremacy of the
Constitution is upheld." 12 Once a "controversy as to the application or interpretation of a
constitutional provision is raised before this Court (as in the instant case), it becomes a legal
issue which the Court is bound by constitutional mandate to decide." 13

The jurisdiction of this Court to adjudicate the matters 14 raised in the petition is clearly set out
in the 1987 Constitution, 15 as follows: jgc:chanrobles.com.ph
"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." cralaw virtua1aw library

The foregoing text emphasizes the judicial department’s duty and power to strike down grave
abuse of discretion on the part of any branch or instrumentality of government including
Congress. It is an innovation in our political law. 16 As explained by former Chief Justice
Roberto Concepcion, 17 "the judiciary is the final arbiter on the question of whether or not a
branch of government or any of its officials has acted without jurisdiction or in excess of
jurisdiction or so capriciously as to constitute an abuse of discretion amounting to excess of
jurisdiction. This is not only a judicial power but a duty to pass judgment on matters of this
nature."cralaw virtua1aw library

As this Court has repeatedly and firmly emphasized in many cases, 18 it will not shirk, digress
from or abandon its sacred duty and authority to uphold the Constitution in matters that involve
grave abuse of discretion brought before it in appropriate cases, committed by any officer,
agency, instrumentality or department of the government. chanrobles.com:cralaw:red

As the petition alleges grave abuse of discretion and as there is no other plain, speedy or
adequate remedy in the ordinary course of law, we have no hesitation at all in holding that this
petition should be given due course and the vital questions raised therein ruled upon under Rule
65 of the Rules of Court. Indeed, certiorari, prohibition and mandamus are appropriate remedies
to raise constitutional issues and to review and/or prohibit/nullify, when proper, acts of
legislative and executive officials. On this, we have no equivocation.

We should stress that, in deciding to take jurisdiction over this petition, this Court will not
review the wisdom of the decision of the President and the Senate in enlisting the country into
the WTO, or pass upon the merits of trade liberalization as a policy espoused by said
international body. Neither will it rule on the propriety of the government’s economic policy of
reducing/removing tariffs, taxes, subsidies, quantitative restrictions, and other import/trade
barriers. Rather, it will only exercise its constitutional duty "to determine whether or not there
had been a grave abuse of discretion amounting to lack or excess of jurisdiction" on the part of
the Senate in ratifying the WTO Agreement and its three annexes.

Second Issue: The WTO Agreement and Economic Nationalism

This is the lis mota, the main issue, raised by the petition.

Petitioners vigorously argue that the "letter, spirit and intent" of the Constitution mandating
"economic nationalism" are violated by the so-called "parity provisions" and "national treatment"
clauses scattered in various parts not only of the WTO Agreement and its annexes but also in the
Ministerial Decisions and Declarations and in the Understanding on Commitments in Financial
Services.
Specifically, the "flagship" constitutional provisions referred to are Sec. 19, Article II, and Secs.
10 and 12, Article XII, of the Constitution, which are worded as follows: jgc:chanrobles.com.ph

"Article II

DECLARATION OF PRINCIPLES AND STATE POLICIES

x        x       x

Sec. 19. The State shall develop a self-reliant and independent national economy effectively
controlled by Filipinos.

x        x       x

Article XII

NATIONAL ECONOMY AND PATRIMONY

x        x       x

Sec. 10 . . . The Congress shall enact measures that will encourage the formation and operation
of enterprises whose capital is wholly owned by Filipinos.

In the grant of rights, privileges, and concessions covering the national economy and patrimony,
the State shall give preference to qualified Filipinos.

x        x       x

Sec. 12. The State shall promote the preferential use of Filipino labor, domestic materials and
locally produced goods, and adopt measures that help make them competitive." cralaw virtua1aw library

Petitioners aver that these sacred constitutional principles are desecrated by the following WTO
provisions quoted in their memorandum: 19

"a) In the area of investment measures related to trade in goods (TRIMS, for brevity): jgc:chanrobles.com.ph

"Article 2

National Treatment and Quantitative Restrictions.

1. Without prejudice to other rights and obligations under GATT 1994. No Member shall apply
any TRIM that is inconsistent with the provisions of Article III or Article XI of GATT 1994.
2. An Illustrative list of TRIMS that are inconsistent with the obligations of general elimination
of quantitative restrictions provided for in paragraph I of Article XI of GATT 1994 is contained
in the Annex to this Agreement." (Agreement on Trade-Related Investment Measures, Vol. 27,
Uruguay Round, Legal Instruments, p. 22121, Emphasis supplied).

The Annex referred to reads as follows: jgc:chanrobles.com.ph

"ANNEX

Illustrative List

1. TRIMS that are inconsistent with the obligation of national treatment provided for in
paragraph 4 of Article III of GATT 1994 include those which are mandatory or enforceable
under domestic law or under administrative rulings, or compliance with which is necessary to
obtain an advantage, and which require: chanrob1es virtual 1aw library

(a) the purchase or use by an enterprise of products of domestic origin or from any domestic
source, whether specified in terms of particular products, in terms of volume or value of
products, or in terms of proportion of volume or value of its local production; or

(b) that an enterprise’s purchases or use of imported products be limited to an amount related to
the volume or value of local products that it exports. chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph

2. TRIMS that are inconsistent with the obligations of general elimination of quantitative
restrictions provided for in paragraph 1 of Article XI of GATT 1994 include those which are
mandatory or enforceable under domestic laws or under administrative rulings, or compliance
with which is necessary to obtain an advantage, and which restrict: chanrob1es virtual 1aw library

(a) the importation by an enterprise of products used in or related to the local production that it
exports;

(b) the importation by an enterprise of products used in or related to its local production by
restricting its access to foreign exchange inflows attributable to the enterprise; or

(c) the exportation or sale for export specified in terms of particular products, in terms of volume
or value of products, or in terms of a preparation of volume or value of its local production."
(Annex to the Agreement on Trade-Related Investment Measures, Vol. 27, Uruguay Round
Legal Documents, p. 22125, Emphasis supplied).

The paragraph 4 of Article III of GATT 1994 referred to is quoted as follows: chanrob1es virtual 1aw library

The products of the territory of any contracting party imported into the territory of any other
contracting party shall be accorded treatment no less favorable than that accorded to like
products of national origin in respect of laws, regulations and requirements affecting their
internal sale, offering for sale, purchase, transportation, distribution or use. The provisions of this
paragraph shall not prevent the application of differential internal transportation charges which
are based exclusively on the economic operation of the means of transport and not on the
nationality of the product." (Article III, GATT 1947, as amended by the Protocol Modifying Part
II, and Article XXVI of GATT, 14 September 1948, 62 UMTS 82-84 in relation to paragraph 1
(a) of the General Agreement on Tariffs and Trade 1994, Vol. 1, Uruguay Round, Legal
Instruments p. 177, Emphasis supplied).

"b) In the area of trade-related aspects of intellectual property rights (TRIPS, for brevity): chanrob1es virtual 1aw library

Each Member shall accord to the nationals of other Members treatment no less favourable than
that it accords to its own nationals with regard to the protection of intellectual property . . . (par.
1, Article 3, Agreement on Trade-Related Aspect of Intellectual Property rights, Vol. 31,
Uruguay Round, Legal Instruments, p. 25432 (Emphasis supplied)

"(c) In the area of the General Agreement on Trade in Services: chanrob1es virtual 1aw library

National Treatment

1. In the sectors inscribed in its schedule, and subject to any conditions and qualifications set out
therein, each Member shall accord to services and service suppliers of any other Member, in
respect of all measures affecting the supply of services, treatment no less favourable than it
accords to its own like services and service suppliers.

2. A Member may meet the requirement of paragraph I by according to services and service
suppliers of any other Member, either formally identical treatment or formally different
treatment to that it accords to its own like services and service suppliers.

3. Formally identical or formally different treatment shall be considered to be less favourable if it

modifies the conditions of completion in favour of services or service suppliers of the Member
compared to like services or service suppliers of any other Member. (Article XVII, General
Agreement on Trade in Services, Vol. 28, Uruguay Round Legal Instruments, p. 22610
Emphasis supplied)." cralaw virtua1aw library

It is petitioners’ position that the foregoing "national treatment" and "parity provisions" of the
WTO Agreement "place nationals and products of member countries on the same footing as
Filipinos and local products," in contravention of the "Filipino First" policy of the Constitution.
They allegedly render meaningless the phrase "effectively controlled by Filipinos." The
constitutional conflict becomes more manifest when viewed in the context of the clear duty
imposed on the Philippines as a WTO member to ensure the conformity of its laws, regulations
and administrative procedures with its obligations as provided in the annexed agreements. 20
Petitioners further argue that these provisions contravene constitutional limitations on the role
exports play in national development and negate the preferential treatment accorded to Filipino
labor, domestic materials and locally produced goods.

On the other hand, respondents through the Solicitor General counter (1) that such Charter
provisions are not self-executing and merely set out general policies; (2) that these nationalistic
portions of the Constitution invoked by petitioners should not be read in isolation but should be
related to other relevant provisions of Art. XII, particularly Secs. 1 and 13 thereof; (3) that read
properly, the cited WTO clauses do not conflict with the Constitution; and (4) that the WTO
Agreement contains sufficient provisions to protect developing countries like the Philippines
from the harshness of sudden trade liberalization. chanrobles law library

We shall now discuss and rule on these arguments.

Declaration of Principles Not Self-Executing

By its very title, Article II of the Constitution is a "declaration of principles and state policies."
The counterpart of this article in the 1935 Constitution 21 is called the "basic political creed of
the nation" by Dean Vicente Sinco. 22 These principles in Article II are not intended to be self-
executing principles ready for enforcement through the courts. 23 They are used by the judiciary
as aids or as guides in the exercise of its power of judicial review, and by the legislature in its
enactment of laws. As held in the leading case of Kilosbayan, Incorporated v. Morato, 24 the
principles and state policies enumerated in Article II and some sections of Article XII are not
"self-executing provisions, the disregard of which can give rise to a cause of action in the courts.
They do not embody judicially enforceable constitutional rights but guidelines for legislation." cralaw virtua1aw library

In the same light, we held in Basco v. Pagcor 25 that broad constitutional principles need
legislative enactments to implement them, thus: jgc:chanrobles.com.ph

"On petitioners’ allegation that P.D. 1869 violates Sections 11 (Personal Dignity) 12 (Family)
and 13 (Role of Youth) of Article II; Section 13 (Social Justice) of Article XIII and Section 2
(Educational Values) of Article XIV of the 1987 Constitution, suffice it to state also that these
are merely statements of principles and policies. As such, they are basically not self-executing,
meaning a law should be passed by Congress to clearly define and effectuate such principles.

‘In general, therefore, the 1935 provisions were not intended to be self-executing principles
ready for enforcement through the courts. They were rather directives addressed to the executive
and to the legislature. If the executive and the legislature failed to heed the directives of the
article, the available remedy was not judicial but political. The electorate could express their
displeasure with the failure of the executive and the legislature through the language of the
ballot. (Bernas, Vol. II, p. 2)."
cralaw virtua1aw library

The reasons for denying a cause of action to an alleged infringement of broad constitutional
principles are sourced from basic considerations of due process and the lack of judicial authority
to wade "into the uncharted ocean of social and economic policy making." Mr. Justice Florentino
P. Feliciano in his concurring opinion in Oposa v. Factoran, Jr., 26 explained these reasons as
follows:jgc:chanrobles.com.ph

"My suggestion is simply that petitioners must, before the trial court, show a more specific legal
right — a right cast in language of a significantly lower order of generality than Article II (15) of
the Constitution — that is or may be violated by the actions, or failures to act, imputed to the
public respondent by petitioners so that the trial court can validly render judgment granting all or
part of the relief prayed for. To my mind, the court should be understood as simply saying that
such a more specific legal right or rights may well exist in our corpus of law, considering the
general policy principles found in the Constitution and the existence of the Philippine
Environment Code, and that the trial court should have given petitioners an effective opportunity
so to demonstrate, instead of aborting the proceedings on a motion to dismiss.

It seems to me important that the legal right which is an essential component of a cause of action
be a specific, operable legal right, rather than a constitutional or statutory policy, for at least two
(2) reasons. One is that unless the legal right claimed to have been violated or disregarded is
given specification in operational terms, defendants may well be unable to defend themselves
intelligently and effectively; in other words, there are due process dimensions to this matter.

The second is a broader-gauge consideration — where a specific violation of law or applicable

regulation is not alleged or proved, petitioners can be expected to fall back on the expanded
conception of judicial power in the second paragraph of Section 1 of Article VIII of the
Constitution which reads: chanrob1es virtual 1aw library

‘Section 1. . . .

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.’ (Emphasis supplied)

When substantive standards as general as ‘the right to a balanced and healthy ecology’ and ‘the
right to health’ are combined with remedial standards as broad ranging as ‘a grave abuse of
discretion amounting to lack or excess of jurisdiction,’ the result will be, it is respectfully
submitted, to propel courts into the uncharted ocean of social and economic policy making. At
least in respect of the vast area of environmental protection and management, our courts have no
claim to special technical competence and experience and professional qualification. Where no
specific, operable norms and standards are shown to exist, then the policy making departments
— the legislative and executive departments — must be given a real and effective opportunity to
fashion and promulgate those norms and standards, and to implement them before the courts
should intervene." chanroblesvirtuallawlibrary

Economic Nationalism Should Be Read with Other Constitutional Mandates to Attain Balanced
Development of Economy

On the other hand, Secs. 10 and 12 of Article XII, apart from merely laying down general
principles relating to the national economy and patrimony, should be read and understood in
relation to the other sections in said article, especially Secs. 1 and 13 thereof which read: jgc:chanrobles.com.ph

"Section 1. The goals of the national economy are a more equitable distribution of opportunities,
income, and wealth; a sustained increase in the amount of goods and services produced by the
nation for the benefit of the people; and an expanding productivity as the key to raising the
quality of life for all, especially the underprivileged.
The State shall promote industrialization and full employment based on sound agricultural
development and agrarian reform, through industries that make full and efficient use of human
and natural resources, and which are competitive in both domestic and foreign markets.
However, the State shall protect Filipino enterprises against unfair foreign competition and trade
practices.

In the pursuit of these goals, all sectors of the economy and all regions of the country shall be
given optimum opportunity to develop. . .

x        x       x

Sec. 13. The State shall pursue a trade policy that serves the general welfare and utilizes all
forms and arrangements of exchange on the basis of equality and reciprocity." cralaw virtua1aw library

As pointed out by the Solicitor General, Sec. 1 lays down the basic goals of national economic
development, as follows: chanrob1es virtual 1aw library

1. A more equitable distribution of opportunities, income and wealth;

2. A sustained increase in the amount of goods and services provided by the nation for the
benefit of the people; and

3. An expanding productivity as the key to raising the quality of life for all especially the
underprivileged.

With these goals in context, the Constitution then ordains the ideals of economic nationalism (1)
by expressing preference in favor of qualified Filipinos "in the grant of rights, privileges and
concessions covering the national economy and patrimony" 27 and in the use of "Filipino labor,
domestic materials and locally-produced goods" ; (2) by mandating the State to "adopt measures
that help make them competitive; 28 and (3) by requiring the State to "develop a self-reliant and
independent national economy effectively controlled by Filipinos." 29 In similar language, the
Constitution takes into account the realities of the outside world as it requires the pursuit of "a
trade policy that serves the general welfare and utilizes all forms and arrangements of exchange
on the basis of equality and reciprocity" ; 30 and speaks of industries "which are competitive in
both domestic and foreign markets" as well as of the protection of "Filipino enterprises against
unfair foreign competition and trade practices." cralaw virtua1aw library

It is true that in the recent case of Manila Prince Hotel v. Government Service Insurance System,
Et Al., 31 this Court held that "Sec. 10, second par., Art. XII of the 1987 Constitution is a
mandatory, positive command which is complete in itself and which needs no further guidelines
or implementing laws or rules for its enforcement. From its very words the provision does not
require any legislation to put it in operation. It is per se judicially enforceable." However, as the
constitutional provision itself states, it is enforceable only in regard to "the grants of rights,
privileges and concessions covering national economy and patrimony" and not to every aspect of
trade and commerce. It refers to exceptions rather than the rule. The issue here is not whether
this paragraph of Sec. 10 of Art. XII is self-executing or not. Rather, the issue is whether, as a
rule, there are enough balancing provisions in the Constitution to allow the Senate to ratify the
Philippine concurrence in the WTO Agreement. And we hold that there are.

All told, while the Constitution indeed mandates a bias in favor of Filipino goods, services, labor
and enterprises, at the same time, it recognizes the need for business exchange with the rest of
the world on the bases of equality and reciprocity and limits protection of Filipino enterprises
only against foreign competition and trade practices that are unfair. 32 In other words, the
Constitution did not intend to pursue an isolationist policy. It did not shut out foreign
investments, goods and services in the development of the Philippine economy. While the
Constitution does not encourage the unlimited entry of foreign goods, services and investments
into the country, it does not prohibit them either. In fact, it allows an exchange on the basis of
equality and reciprocity, frowning only on foreign competition that is unfair.

WTO Recognizes Need to Protect Weak Economies

Upon the other hand, respondents maintain that the WTO itself has some built-in advantages to
protect weak and developing economies, which comprise the vast majority of its members.
Unlike in the UN where major states have permanent seats and veto powers in the Security
Council, in the WTO, decisions are made on the basis of sovereign equality, with each member’s
vote equal in weight to that of any other. There is no WTO equivalent of the UN Security
Council.chanrobles.com : virtual lawlibrary

"WTO decides by consensus whenever possible, otherwise, decisions of the Ministerial

Conference and the General Council shall be taken by the majority of the votes cast, except in
cases of interpretation of the Agreement or waiver of the obligation of a member which would
require three fourths vote. Amendments would require two thirds vote in general. Amendments
to MFN provisions and the Amendments provision will require assent of all members. Any
member may withdraw from the Agreement upon the expiration of six months from the date of
notice of withdrawals." 33

Hence, poor countries can protect their common interests more effectively through the WTO
than through one-on-one negotiations with developed countries. Within the WTO, developing
countries can form powerful blocs to push their economic agenda more decisively than outside
the Organization. This is not merely a matter of practical alliances but a negotiating strategy
rooted in law. Thus, the basic principles underlying the WTO Agreement recognize the need of
developing countries like the Philippines to "share in the growth in international trade
commensurate with the needs of their economic development." These basic principles are found
in the preamble 34 of the WTO Agreement as follows: jgc:chanrobles.com.ph

"The Parties to this Agreement,

Recognizing that their relations in the field of trade and economic endeavour should be
conducted with a view to raising standards of living, ensuring full employment and a large and
steadily growing volume of real income and effective demand, and expanding the production of
and trade in goods and services, while allowing for the optimal use of the world’s resources in
accordance with the objective of sustainable development, seeking both to protect and preserve
the environment and to enhance the means for doing so in a manner consistent with their
respective needs and concerns at different levels of economic development,

Recognizing further that there is need for positive efforts designed to ensure that developing
countries, and especially the least developed among them, secure a share in the growth in
international trade commensurate with the needs of their economic development,

Being desirous of contributing to these objectives by entering into reciprocal and mutually
advantageous arrangements directed to the substantial reduction of tariffs and other barriers to
trade and to the elimination of discriminatory treatment in international trade relations,

Resolved, therefore, to develop an integrated, more viable and durable multilateral trading
system encompassing the General Agreement on Tariffs and Trade, the results of past trade
liberalization efforts, and all of the results of the Uruguay Round of Multilateral Trade
Negotiations,

Determined to preserve the basic principles and to further the objectives underlying this
multilateral trading system, . . ." (Emphasis supplied.)

Specific WTO Provisos Protect Developing Countries

So too, the Solicitor General points out that pursuant to and consistent with the foregoing basic
principles, the WTO Agreement grants developing countries a more lenient treatment, giving
their domestic industries some protection from the rush of foreign competition. Thus, with
respect to tariffs in general, preferential treatment is given to developing countries in terms of the
amount of tariff reduction and the period within which the reduction is to be spread out.
Specifically, GATT requires an average tariff reduction rate of 36% for developed countries to
be effected within a period of six (6) years while developing countries — including the
Philippines — are required to effect an average tariff reduction of only 24% within ten (10)
years.

In respect to domestic subsidy, GATT requires developed countries to reduce domestic support
to agricultural products by 20% over six (6) years, as compared to only 13% for developing
countries to be effected within ten (10) years.

In regard to export subsidy for agricultural products, GATT requires developed countries to
reduce their budgetary outlays for export subsidy by 36% and export volumes receiving export
subsidy by 21% within a period of six (6) years. For developing countries, however, the
reduction rate is only two-thirds of that prescribed for developed countries and a longer period of
ten (10) years within which to effect such reduction.

Moreover, GATT itself has provided built-in protection from unfair foreign competition and
trade practices including anti-dumping measures, countervailing measures and safeguards against
import surges. Where local businesses are jeopardized by unfair foreign competition, the
Philippines can avail of these measures. There is hardly therefore any basis for the statement that
under the WTO, local industries and enterprises will all be wiped out and that Filipinos will be
deprived of control of the economy. Quite the contrary, the weaker situations of developing
nations like the Philippines have been taken into account; thus, there would be no basis to say
that in joining the WTO, the respondents have gravely abused their discretion. True, they have
made a bold decision to steer the ship of state into the yet uncharted sea of economic
liberalization. But such decision cannot be set aside on the ground of grave abuse of discretion,
simply because we disagree with it or simply because we believe only in other economic
policies. As earlier stated, the Court in taking jurisdiction of this case will not pass upon the
advantages and disadvantages of trade liberalization as an economic policy. It will only perform
its constitutional duty of determining whether the Senate committed grave abuse of discretion. chanroblesvirtual|awlibrary

Constitution Does Not Rule Out Foreign Competition

Furthermore, the constitutional policy of a "self-reliant and independent national economy" 35

does not necessarily rule out the entry of foreign investments, goods and services. It
contemplates neither "economic seclusion" nor "mendicancy in the international community." As
explained by Constitutional Commissioner Bernardo Villegas, sponsor of this constitutional
policy:jgc:chanrobles.com.ph

"Economic self reliance is a primary objective of a developing country that is keenly aware of
overdependence on external assistance for even its most basic needs. It does not mean autarky or
economic seclusion; rather, it means avoiding mendicancy in the international community.
Independence refers to the freedom from undue foreign control of the national economy,
especially in such strategic industries as in the development of natural resources and public
utilities." 36

The WTO reliance on "most favored nation," "national treatment," and "trade without
discrimination" cannot be struck down as unconstitutional as in fact they are rules of equality and
reciprocity that apply to all WTO members. Aside from envisioning a trade policy based on
"equality and reciprocity," 37 the fundamental law encourages industries that are "competitive in
both domestic and foreign markets," thereby demonstrating a clear policy against a sheltered
domestic trade environment, but one in favor of the gradual development of robust industries that
can compete with the best in the foreign markets. Indeed, Filipino managers and Filipino
enterprises have shown capability and tenacity to compete internationally. And given a free trade
environment, Filipino entrepreneurs and managers in Hongkong have demonstrated the Filipino
capacity to grow and to prosper against the best offered under a policy of laissez faire.

Constitution Favors Consumers, Not Industries or Enterprises

The Constitution has not really shown any unbalanced bias in favor of any business or enterprise,
nor does it contain any specific pronouncement that Filipino companies should be pampered with
a total proscription of foreign competition. On the other hand, respondents claim that
WTO/GATT aims to make available to the Filipino consumer the best goods and services
obtainable anywhere in the world at the most reasonable prices. Consequently, the question boils
down to whether WTO/GATT will favor the general welfare of the public at large.

Will adherence to the WTO treaty bring this ideal (of favoring the general welfare) to reality?
Will WTO/GATT succeed in promoting the Filipinos’ general welfare because it will — as
promised by its promoters — expand the country’s exports and generate more employment?

Will it bring more prosperity, employment, purchasing power and quality products at the most
reasonable rates to the Filipino public?

The responses to these questions involve "judgment calls" by our policy makers, for which they
are answerable to our people during appropriate electoral exercises. Such questions and the
answers thereto are not subject to judicial pronouncements based on grave abuse of discretion.

Constitution Designed to Meet Future Events and Contingencies

No doubt, the WTO Agreement was not yet in existence when the Constitution was drafted and
ratified in 1987. That does not mean however that the Charter is necessarily flawed in the sense
that its framers might not have anticipated the advent of a borderless world of business. By the
same token, the United Nations was not yet in existence when the 1935 Constitution became
effective. Did that necessarily mean that the then Constitution might not have contemplated a
diminution of the absoluteness of sovereignty when the Philippines signed the UN Charter,
thereby effectively surrendering part of its control over its foreign relations to the decisions of
various UN organs like the Security Council?

It is not difficult to answer this question. Constitutions are designed to meet not only the vagaries
of contemporary events. They should be interpreted to cover even future and unknown
circumstances. It is to the credit of its drafters that a Constitution can withstand the assaults of
bigots and infidels but at the same time bend with the refreshing winds of change necessitated by
unfolding events. As one eminent political law writer and respected jurist 38 explains: jgc:chanrobles.com.ph

"The Constitution must be quintessential rather than superficial, the root and not the blossom, the
base and framework only of the edifice that is yet to rise. It is but the core of the dream that must
take shape, not in a twinkling by mandate of our delegates, but slowly ‘in the crucible of Filipino
minds and hearts,’ where it will in time develop its sinews and gradually gather its strength and
finally achieve its substance. In fine, the Constitution cannot, like the goddess Athena, rise full-
grown from the brow of the Constitutional Convention, nor can it conjure by mere fiat an instant
Utopia. It must grow with the society it seeks to re-structure and march apace with the progress
of the race, drawing from the vicissitudes of history the dynamism and vitality that will keep it,
far from becoming a petrified rule, a pulsing, living law attuned to the heartbeat of the nation."
cdtech

Third Issue: The WTO Agreement and Legislative Power

The WTO Agreement provides that" (e)ach Member shall ensure the conformity of its laws,
regulations and administrative procedures with its obligations as provided in the annexed
Agreements." 39 Petitioners maintain that this undertaking "unduly limits, restricts and impairs
Philippine sovereignty, specifically the legislative power which under Sec. 2, Article VI of the
1987 Philippine Constitution is vested in the Congress of the Philippines. It is an assault on the
sovereign powers of the Philippines because this means that Congress could not pass legislation
that will be good for our national interest and general welfare if such legislation will not conform
with the WTO Agreement, which not only relates to the trade in goods . . . but also to the flow of
investments and money . . . as well as to a whole slew of agreements on socio-cultural
matters . . ." 40

More specifically, petitioners claim that said WTO proviso derogates from the power to tax,
which is lodged in the Congress. 41 And while the Constitution allows Congress to authorize the
President to fix tariff rates, import and export quotas, tonnage and wharfage dues, and other
duties or imposts, such authority is subject to "specified limits and . . . such limitations and
restrictions" as Congress may provide, 42 as in fact it did under Sec. 401 of the Tariff and
Customs Code.

Sovereignty Limited by International Law and Treaties

This Court notes and appreciates the ferocity and passion by which petitioners stressed their
arguments on this issue. However, while sovereignty has traditionally been deemed absolute and
all-encompassing on the domestic level, it is however subject to restrictions and limitations
voluntarily agreed to by the Philippines, expressly or impliedly, as a member of the family of
nations. Unquestionably, the Constitution did not envision a hermit-type isolation of the country
from the rest of the world. In its Declaration of Principles and State Policies, the Constitution
"adopts the generally accepted principles of international law as part of the law of the land, and
adheres to the policy of peace, equality, justice, freedom, cooperation and amity, with all
nations." 43 By the doctrine of incorporation, the country is bound by generally accepted
principles of international law, which are considered to be automatically part of our own laws. 44
One of the oldest and most fundamental rules in international law is pacta sunt servanda —
international agreements must be performed in good faith. "A treaty engagement is not a mere
moral obligation but creates a legally binding obligation on the parties . . . A state which has
contracted valid international obligations is bound to make in its legislations such modifications
as may be necessary to ensure the fulfillment of the obligations undertaken." 45

By their inherent nature, treaties really limit or restrict the absoluteness of sovereignty. By their
voluntary act, nations may surrender some aspects of their state power in exchange for greater
benefits granted by or derived from a convention or pact. After all, states, like individuals, live
with coequals, and in pursuit of mutually covenanted objectives and benefits, they also
commonly agree to limit the exercise of their otherwise absolute rights. Thus, treaties have been
used to record agreements between States concerning such widely diverse matters as, for
example, the lease of naval bases, the sale or cession of territory, the termination of war, the
regulation of conduct of hostilities, the formation of alliances, the regulation of commercial
relations, the settling of claims, the laying down of rules governing conduct in peace and the
establishment of international organizations. 46 The sovereignty of a state therefore cannot in
fact and in reality be considered absolute. Certain restrictions enter into the picture: (1)
limitations imposed by the very nature of membership in the family of nations and (2) limitations
imposed by treaty stipulations. As aptly put by John F. Kennedy, "Today, no nation can build its
destiny alone. The age of self-sufficient nationalism is over. The age of interdependence is here."
47
UN Charter and Other Treaties Limit Sovereignty

Thus, when the Philippines joined the United Nations as one of its 51 charter members, it
consented to restrict its sovereign rights under the "concept of sovereignty as auto-limitation."
47-A Under Article 2 of the UN Charter," (a)ll members shall give the United Nations every
assistance in any action it takes in accordance with the present Charter, and shall refrain from
giving assistance to any state against which the United Nations is taking preventive or
enforcement action." Such assistance includes payment of its corresponding share not merely in
administrative expenses but also in expenditures for the peace-keeping operations of the
organization. In its advisory opinion of July 20, 1961, the International Court of Justice held that
money used by the United Nations Emergency Force in the Middle East and in the Congo were
"expenses of the United Nations" under Article 17, paragraph 2, of the UN Charter. Hence, all its
members must bear their corresponding share in such expenses. In this sense, the Philippine
Congress is restricted in its power to appropriate. It is compelled to appropriate funds whether it
agrees with such peace-keeping expenses or not. So too, under Article 105 of the said Charter,
the UN and its representatives enjoy diplomatic privileges and immunities, thereby limiting
again the exercise of sovereignty of members within their own territory. Another example:
although "sovereign equality" and "domestic jurisdiction" of all members are set forth as
underlying principles in the UN Charter, such provisos are however subject to enforcement
measures decided by the Security Council for the maintenance of international peace and
security under Chapter VII of the Charter. A final example: under Article 103," (i)n the event of
a conflict between the obligations of the Members of the United Nations under the present
Charter and their obligations under any other international agreement, their obligation under the
present charter shall prevail," thus unquestionably denying the Philippines — as a member — the
sovereign power to make a choice as to which of conflicting obligations, if any, to honor. chanroblesvirtuallawlibrary:red

Apart from the UN Treaty, the Philippines has entered into many other international pacts —
both bilateral and multilateral — that involve limitations on Philippine sovereignty. These are
enumerated by the Solicitor General in his Compliance dated October 24, 1996, as follows: jgc:chanrobles.com.ph

"(a) Bilateral convention with the United States regarding taxes on income, where the
Philippines agreed, among others, to exempt from tax, income received in the Philippines by,
among others, the Federal Reserve Bank of the United States, the Export/Import Bank of the
United States, the Overseas Private Investment Corporation of the United States. Likewise, in
said convention, wages, salaries and similar remunerations paid by the United States to its
citizens for labor and personal services performed by them as employees or officials of the
United States are exempt from income tax by the Philippines.

(b) Bilateral agreement with Belgium, providing, among others, for the avoidance of double
taxation with respect to taxes on income.

(c) Bilateral convention with the Kingdom of Sweden for the avoidance of double taxation.

(d) Bilateral convention with the French Republic for the avoidance of double taxation.
(e) Bilateral air transport agreement with Korea where the Philippines agreed to exempt from all
customs duties, inspection fees and other duties or taxes aircrafts of South Korea and the regular
equipment, spare parts and supplies arriving with said aircrafts.

(f) Bilateral air service agreement with Japan, where the Philippines agreed to exempt from
customs duties, excise taxes, inspection fees and other similar duties, taxes or charges fuel,
lubricating oils, spare parts, regular equipment, stores on board Japanese aircrafts while on
Philippine soil.

(g) Bilateral air service agreement with Belgium where the Philippines granted Belgian air
carriers the same privileges as those granted to Japanese and Korean air carriers under separate
air service agreements.

(h) Bilateral notes with Israel for the abolition of transit and visitor visas where the Philippines
exempted Israeli nationals from the requirement of obtaining transit or visitor visas for a sojourn
in the Philippines not exceeding 59 days.

(i) Bilateral agreement with France exempting French nationals from the requirement of
obtaining transit and visitor visa for a sojourn not exceeding 59 days.

(j) Multilateral Convention on Special Missions, where the Philippines agreed that premises of
Special Missions in the Philippines are inviolable and its agents can not enter said premises
without consent of the Head of Mission concerned. Special Missions are also exempted from
customs duties, taxes and related charges.

(k) Multilateral Convention on the Law of Treaties. In this convention, the Philippines agreed to
be governed by the Vienna Convention on the Law of Treaties.

(l) Declaration of the President of the Philippines accepting compulsory jurisdiction of the
International Court of Justice. The International Court of Justice has jurisdiction in all legal
disputes concerning the interpretation of a treaty, any question of international law, the existence
of any fact which, if established, would constitute a breach of international obligation." cralaw virtua1aw library

In the foregoing treaties, the Philippines has effectively agreed to limit the exercise of its
sovereign powers of taxation, eminent domain and police power. The underlying consideration in
this partial surrender of sovereignty is the reciprocal commitment of the other contracting states
in granting the same privilege and immunities to the Philippines, its officials and its citizens. The
same reciprocity characterizes the Philippine commitments under WTO-GATT.

"International treaties, whether relating to nuclear disarmament, human rights, the environment,
the law of the sea, or trade, constrain domestic political sovereignty through the assumption of
external obligations. But unless anarchy in international relations is preferred as an alternative, in
most cases we accept that the benefits of the reciprocal obligations involved outweigh the costs
associated with any loss of political sovereignty. (T)rade treaties that structure relations by
reference to durable, well-defined substantive norms and objective dispute resolution procedures
reduce the risks of larger countries exploiting raw economic power to bully smaller countries, by
subjecting power relations to some form of legal ordering. In addition, smaller countries
typically stand to gain disproportionately from trade liberalization. This is due to the simple fact
that liberalization will provide access to a larger set of potential new trading relationship than in
case of the larger country gaining enhanced success to the smaller country’s market." 48

The point is that, as shown by the foregoing treaties, a portion of sovereignty may be waived
without violating the Constitution, based on the rationale that the Philippines "adopts the
generally accepted principles of international law as part of the law of the land and adheres to the
policy of . . . cooperation and amity with all nations." casia

Fourth Issue: The WTO Agreement and Judicial Power

Petitioners aver that paragraph 1, Article 34 of the General Provisions and Basic Principles of the
Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) 49 intrudes on the
power of the Supreme Court to promulgate rules concerning pleading, practice and procedures.
50

To understand the scope and meaning of Article 34, TRIPS, 51 it will be fruitful to restate its full
text as follows:jgc:chanrobles.com.ph

"Article 34

Process Patents: Burden of Proof

1. For the purposes of civil proceedings in respect of the infringement of the rights of the owner
referred to in paragraph 1 (b) of Article 28, if the subject matter of a patent is a process for
obtaining a product, the judicial authorities shall have the authority to order the defendant to
prove that the process to obtain an identical product is different from the patented process.
Therefore, Members shall provide, in at least one of the following circumstances, that any
identical product when produced without the consent of the patent owner shall, in the absence of
proof to the contrary, be deemed to have been obtained by the patented process: chanrob1es virtual 1aw library

(a) if the product obtained by the patented process is new;

(b) if there is a substantial likelihood that the identical product was made by the process and the
owner of the patent has been unable through reasonable efforts to determine the process actually
used.

2. Any Member shall be free to provide that the burden of proof indicated in paragraph 1 shall be
on the alleged infringer only if the condition referred to in subparagraph (a) is fulfilled or only if
the condition referred to in subparagraph (b) is fulfilled.

3. In the adduction of proof to the contrary, the legitimate interests of defendants in protecting
their manufacturing and business secrets shall be taken into account." cralaw virtua1aw library

From the above, a WTO Member is required to provide a rule of disputable (note the words "in
the absence of proof to the contrary") presumption that a product shown to be identical to one
produced with the use of a patented process shall be deemed to have been obtained by the
(illegal) use of the said patented process, (1) where such product obtained by the patented
product is new, or (2) where there is "substantial likelihood" that the identical product was made
with the use of the said patented process but the owner of the patent could not determine the
exact process used in obtaining such identical product. Hence, the "burden of proof"
contemplated by Article 34 should actually be understood as the duty of the alleged patent
infringer to overthrow such presumption. Such burden, properly understood, actually refers to
the "burden of evidence" (burden of going forward) placed on the producer of the identical (or
fake) product to show that his product was produced without the use of the patented process.

The foregoing notwithstanding, the patent owner still has the "burden of proof" since, regardless
of the presumption provided under paragraph 1 of Article 34, such owner still has to introduce
evidence of the existence of the alleged identical product, the fact that it is "identical" to the
genuine one produced by the patented process and the fact of "newness" of the genuine product
or the fact of "substantial likelihood" that the identical product was made by the patented
process.

The foregoing should really present no problem in changing the rules of evidence as the present
law on the subject, Republic Act No. 165, as amended, otherwise known as the Patent Law,
provides a similar presumption in cases of infringement of patented design or utility model,
thus:jgc:chanrobles.com.ph

"SEC. 60. Infringement. — Infringement of a design patent or of a patent for utility model shall
consist in unauthorized copying of the patented design or utility model for the purpose of trade or
industry in the article or product and in the making, using or selling of the article or product
copying the patented design or utility model. Identity or substantial identity with the patented
design or utility model shall constitute evidence of copying." (Emphasis supplied)

Moreover, it should be noted that the requirement of Article 34 to provide a disputable

presumption applies only if (1) the product obtained by the patented process is NEW or (2) there
is a substantial likelihood that the identical product was made by the process and the process
owner has not been able through reasonable effort to determine the process used. Where either of
these two provisos does not obtain, members shall be free to determine the appropriate method of
implementing the provisions of TRIPS within their own internal systems and processes.

By and large, the arguments adduced in connection with our disposition of the third issue —
derogation of legislative power — will apply to this fourth issue also. Suffice it to say that the
reciprocity clause more than justifies such intrusion, if any actually exists. Besides, Article 34
does not contain an unreasonable burden, consistent as it is with due process and the concept of
adversarial dispute settlement inherent in our judicial system.

So too, since the Philippine is a signatory to most international conventions on patents,

trademarks and copyrights, the adjustment in legislation and rules of procedure will not be
substantial. 52
Fifth Issue: Concurrence Only in the WTO Agreement and Not in Other Documents Contained
in the Final Act

Petitioners allege that the Senate concurrence in the WTO Agreement and its annexes — but not
in the other documents referred to in the Final Act, namely the Ministerial Declaration and
Decisions and the Understanding on Commitments in Financial Services — is defective and
insufficient and thus constitutes abuse of discretion. They submit that such concurrence in the
WTO Agreement alone is flawed because it is in effect a rejection of the Final Act, which in turn
was the document signed by Secretary Navarro, in representation of the Republic upon authority
of the President. They contend that the second letter of the President to the Senate 53 which
enumerated what constitutes the Final Act should have been the subject of concurrence of the
Senate.chanroblesvirtuallawlibrary

"A final act, sometimes called protocol de clôture, is an instrument which records the winding up
of the proceedings of a diplomatic conference and usually includes a reproduction of the texts of
treaties, conventions, recommendations and other acts agreed upon and signed by the
plenipotentiaries attending the conference." 54 It is not the treaty itself. It is rather a summary of
the proceedings of a protracted conference which may have taken place over several years. The
text of the "Final Act Embodying the Results of the Uruguay Round of Multilateral Trade
Negotiations" is contained in just one page 55 in Vol. I of the 36-volume Uruguay Round of
Multilateral Trade Negotiations. By signing said Final Act, Secretary Navarro as representative
of the Republic of the Philippines undertook: jgc:chanrobles.com.ph

"(a) to submit, as appropriate, the WTO Agreement for the consideration of their respective
competent authorities with a view to seeking approval of the Agreement in accordance with their
procedures; and

(b) to adopt the Ministerial Declarations and Decisions." cralaw virtua1aw library

The assailed Senate Resolution No. 97 expressed concurrence in exactly what the Final Act
required from its signatories, namely, concurrence of the Senate in the WTO Agreement.

The Ministerial Declarations and Decisions were deemed adopted without need for ratification.
They were approved by the ministers by virtue of Article XXV: 1 of GATT which provides that
representatives of the members can meet "to give effect to those provisions of this Agreement
which invoke joint action, and generally with a view to facilitating the operation and furthering
the objectives of this Agreement." 56

The Understanding on Commitments in Financial Services also approved in Marrakesh does not
apply to the Philippines. It applies only to those 27 Members which "have indicated in their
respective schedules of commitments on standstill, elimination of monopoly, expansion of
operation of existing financial service suppliers, temporary entry of personnel, free transfer and
processing of information, and national treatment with respect to access to payment, clearing
systems and refinancing available in the normal course of business." 57

On the other hand, the WTO Agreement itself expresses what multilateral agreements are
deemed included as its integral parts, 58 as follows: jgc:chanrobles.com.ph

"Article II

Scope of the WTO

1. The WTO shall provide the common institutional framework for the conduct of trade relations
among its Members in matters to the agreements and associated legal instruments included in the
Annexes to this Agreement.

2. The Agreements and associated legal instruments included in Annexes 1, 2, and 3 (hereinafter
referred to as "Multilateral Agreements") are integral parts of this Agreement, binding on all
Members.

3. The Agreements and associated legal instruments included in Annex 4 (hereinafter referred to
as "Plurilateral Trade Agreements") are also part of this Agreement for those Members that have
accepted them, and are binding on those Members. The Plurilateral Trade Agreements do not
create either obligation or rights for Members that have not accepted them.

4. The General Agreement on Tariffs and Trade 1994 as specified in annex 1A (hereinafter
referred to as "GATT 1994") is legally distinct from the General Agreement on Tariffs and
Trade, dated 30 October 1947, annexed to the Final Act adopted at the conclusion of the Second
Session of the Preparatory Committee of the United Nations Conference on Trade and
Employment, as subsequently rectified, amended or modified (hereinafter referred to as "GATT
1947").

It should be added that the Senate was well-aware of what it was concurring in as shown by the
members’ deliberation on August 25, 1994. After reading the letter of President Ramos dated
August 11, 1994, 59 the senators of the Republic minutely dissected what the Senate was
concurring in, as follows: 60

"THE CHAIRMAN: Yes. Now, the question of the validity of the submission came up in the
first day hearing of this Committee yesterday. Was the observation made by Senator Tañada that
what was submitted to the Senate was not the agreement on establishing the World Trade
Organization by the final act of the Uruguay Round which is not the same as the agreement
establishing the World Trade Organization? And on that basis, Senator Tolentino raised a point
of order which, however, he agreed to withdraw upon understanding that his suggestion for an
alternative solution at that time was acceptable. That suggestion was to treat the proceedings of
the Committee as being in the nature of briefings for Senators until the question of the
submission could be clarified.

And so, Secretary Romulo, in effect, is the President submitting a new. . . is he making a new
submission which improves on the clarity of the first submission?

MR. ROMULO: Mr. Chairman, to make sure that it is clear cut and there should be no
misunderstanding, it was his intention to clarify all matters by giving this letter.
THE CHAIRMAN: Thank you.

Can this Committee hear from Senator Tañada and later on Senator Tolentino since they were
the ones that raised this question yesterday?

Senator Tañada, please.

SEN. TAÑADA: Thank you, Mr. Chairman.

Based on what Secretary Romulo has read, it would now clearly appear that what is being
submitted to the Senate for ratification is not the Final Act of the Uruguay Round, but rather the
Agreement on the World Trade Organization as well as the Ministerial Declarations and
Decisions, and the Understanding and Commitments in Financial Services.

I am now satisfied with the wording of the new submission of President Ramos.

SEN. TAÑADA. . . . of President Ramos, Mr. Chairman.

THE CHAIRMAN. Thank you, Senator Tañada. Can we hear from Senator Tolentino? And after
him Senator Neptali Gonzales and Senator Lina.

SEN. TOLENTINO, Mr. Chairman, I have not seen the new submission actually transmitted to
us but I saw the draft of his earlier, and I think it now complies with the provisions of the
Constitution, and with the Final Act itself . The Constitution does not require us to ratify the
Final Act. It requires us to ratify the Agreement which is now being submitted. The Final Act
itself specifies what is going to be submitted to with the governments of the participants.
chanrobles.com : virtual law library

In paragraph 2 of the Final Act, we read and I quote: chanrob1es virtual 1aw library

‘By signing the present Final Act, the representatives agree: (a) to submit as appropriate the
WTO Agreement for the consideration of the respective competent authorities with a view of
seeking approval of the Agreement in accordance with their procedures.’

In other words, it is not the Final Act that was agreed to be submitted to the governments for
ratification or acceptance as whatever their constitutional procedures may provide but it is the
World Trade Organization Agreement. And if that is the one that is being submitted now, I think
it satisfies both the Constitution and the Final Act itself .

Thank you, Mr. Chairman.

THE CHAIRMAN. Thank you, Senator Tolentino, May I call on Senator Gonzales.

SEN. GONZALES. Mr. Chairman, my views on this matter are already a matter of record. And
they had been adequately reflected in the journal of yesterday’s session and I don’t see any need
for repeating the same.
Now, I would consider the new submission as an act ex abudante cautela.

THE CHAIRMAN. Thank you, Senator Gonzales. Senator Lina, do you want to make any
comment on this?

SEN. LINA, Mr. President, I agree with the observation just made by Senator Gonzales out of
the abundance of question. Then the new submission is, I believe, stating the obvious and
therefore I have no further comment to make." cralaw virtua1aw library

Epilogue

In praying for the nullification of the Philippine ratification of the WTO Agreement, petitioners
are invoking this Court’s constitutionally imposed duty "to determine whether or not there has
been grave abuse of discretion amounting to lack or excess of jurisdiction" on the part of the
Senate in giving its concurrence therein via Senate Resolution No. 97. Procedurally, a writ of
certiorari grounded on grave abuse of discretion may be issued by the Court under Rule 65 of
the Rules of Court when it is amply shown that petitioners have no other plain, speedy and
adequate remedy in the ordinary course of law.

By grave abuse of discretion is meant such capricious and whimsical exercise of judgment as is
equivalent to lack of jurisdiction. 61 Mere abuse of discretion is not enough. It must be grave
abuse of discretion as when the power is exercised in an arbitrary or despotic manner by reason
of passion or personal hostility, and must be so patent and so 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. 62 Failure on the part of the petitioner to show grave abuse of discretion will result in the
dismissal of the petition. 63

In rendering this Decision, this Court never forgets that the Senate, whose act is under review, is
one of two sovereign houses of Congress and is thus entitled to great respect in its actions. It is
itself a constitutional body independent and coordinate, and thus its actions are presumed regular
and done in good faith. Unless convincing proof and persuasive arguments are presented to
overthrow such presumptions, this Court will resolve every doubt in its favor. Using the
foregoing well-accepted definition of grave abuse of discretion and the presumption of regularity
in the Senate’s processes, this Court cannot find any cogent reason to impute grave abuse of
discretion to the Senate’s exercise of its power of concurrence in the WTO Agreement granted it
by Sec. 21 of Article VII of the Constitution. 64

It is true, as alleged by petitioners, that broad constitutional principles require the State to
develop an independent national economy effectively controlled by Filipinos; and to protect
and/or prefer Filipino labor, products, domestic materials and locally produced goods. But it is
equally true that such principles — while serving as judicial and legislative guides — are not in
themselves sources of causes of action. Moreover, there are other equally fundamental
constitutional principles relied upon by the Senate which mandate the pursuit of a "trade policy
that serves the general welfare and utilizes all forms and arrangements of exchange on the basis
of equality and reciprocity" and the promotion of industries "which are competitive in both
domestic and foreign markets," thereby justifying its acceptance of said treaty. So too, the
alleged impairment of sovereignty in the exercise of legislative and judicial powers is balanced
by the adoption of the generally accepted principles of international law as part of the law of the
land and the adherence of the Constitution to the policy of cooperation and amity with all
nations.chanroblesvirtuallawlibrary

That the Senate, after deliberation and voting, voluntarily and overwhelmingly gave its consent
to the WTO Agreement thereby making it "a part of the law of the land" is a legitimate exercise
of its sovereign duty and power. We find no "patent and gross" arbitrariness or despotism "by
reason of passion or personal hostility" in such exercise. It is not impossible to surmise that this
Court, or at least some of its members, may even agree with petitioners that it is more
advantageous to the national interest to strike down Senate Resolution No. 97. But that is not a
legal reason to attribute grave abuse of discretion to the Senate and to nullify its decision. To do
so would constitute grave abuse in the exercise of our own judicial power and duty. Ineludably,
what the Senate did was a valid exercise of its authority. As to whether such exercise was wise,
beneficial or viable is outside the realm of judicial inquiry and review. That is a matter between
the elected policy makers and the people. As to whether the nation should join the worldwide
march toward trade liberalization and economic globalization is a matter that our people should
determine in electing their policy makers. After all, the WTO Agreement allows withdrawal of
membership, should this be the political desire of a member.

The eminent futurist John Naisbitt, author of the best seller Megatrends, predicts an Asian
Renaissance 65 where "the East will become the dominant region of the world economically,
politically and culturally in the next century." He refers to the "free market" espoused by WTO
as the "catalyst" in this coming Asian ascendancy. There are at present about 31 countries
including China, Russia and Saudi Arabia negotiating for membership in the WTO.
Notwithstanding objections against possible limitations on national sovereignty, the WTO
remains as the only viable structure for multilateral trading and the veritable forum for the
development of international trade law. The alternative to WTO is isolation, stagnation, if not
economic self-destruction. Duly enriched with original membership, keenly aware of the
advantages and disadvantages of globalization with its on-line experience, and endowed with a
vision of the future, the Philippines now straddles the crossroads of an international strategy for
economic prosperity and stability in the new millennium. Let the people, through their duly
authorized elected officers, make their free choice.

WHEREFORE, the petition is DISMISSED for lack of merit. chanroblesvirtuallawlibrary:red

SO ORDERED.
 [G.R. NO. 183591 : October 14, 2008]

THE PROVINCE OF NORTH COTABATO, duly represented by GOVERNOR JESUS

SACDALAN and/or VICE-GOVERNOR EMMANUEL PIÑOL, for and in his own
behalf, Petitioners, v. THE GOVERNMENT OF THE REPUBLIC OF THE PHILIPPINES
PEACE PANEL ON ANCESTRAL DOMAIN (GRP), represented by SEC. RODOLFO
GARCIA, ATTY. LEAH ARMAMENTO, ATTY. SEDFREY CANDELARIA, MARK
RYAN SULLIVAN and/or GEN. HERMOGENES ESPERON, JR., the latter in his
capacity as the present and duly-appointed Presidential Adviser on the Peace Process
(OPAPP) or the so-called Office of the Presidential Adviser on the Peace Process,
Respondent.

DECISION

CARPIO MORALES, J.:

Subject of these consolidated cases is the extent of the powers of the President in pursuing the
peace process.While the facts surrounding this controversy center on the armed conflict in
Mindanao between the government and the Moro Islamic Liberation Front (MILF), the legal
issue involved has a bearing on all areas in the country where there has been a long-standing
armed conflict. Yet again, the Court is tasked to perform a delicate balancing act. It must
uncompromisingly delineate the bounds within which the President may lawfully exercise her
discretion, but it must do so in strict adherence to the Constitution, lest its ruling unduly restricts
the freedom of action vested by that same Constitution in the Chief Executive precisely to enable
her to pursue the peace process effectively.

I. FACTUAL ANTECEDENTS OF THE PETITIONS

On August 5, 2008, the Government of the Republic of the Philippines (GRP) and the MILF,
through the Chairpersons of their respective peace negotiating panels, were scheduled to sign a
Memorandum of Agreement on the Ancestral Domain (MOA-AD) Aspect of the GRP-MILF
Tripoli Agreement on Peace of 2001 in Kuala Lumpur, Malaysia.

The MILF is a rebel group which was established in March 1984 when, under the leadership of
the late Salamat Hashim, it splintered from the Moro National Liberation Front (MNLF) then
headed by Nur Misuari, on the ground, among others, of what Salamat perceived to be the
manipulation of the MNLF away from an Islamic basis towards Marxist-Maoist orientations.1

The signing of the MOA-AD between the GRP and the MILF was not to materialize, however,
for upon motion of petitioners, specifically those who filed their cases before the scheduled
signing of the MOA-AD, this Court issued a Temporary Restraining Order enjoining the GRP
from signing the same.

The MOA-AD was preceded by a long process of negotiation and the concluding of several prior
agreements between the two parties beginning in 1996, when the GRP-MILF peace negotiations
began. On July 18, 1997, the GRP and MILF Peace Panels signed the Agreement on General
Cessation of Hostilities. The following year, they signed the General Framework of Agreement
of Intent on August 27, 1998.

The Solicitor General, who represents respondents, summarizes the MOA-AD by stating that the
same contained, among others, the commitment of the parties to pursue peace negotiations,
protect and respect human rights, negotiate with sincerity in the resolution and pacific settlement
of the conflict, and refrain from the use of threat or force to attain undue advantage while the
peace negotiations on the substantive agenda are on-going.2

Early on, however, it was evident that there was not going to be any smooth sailing in the GRP-
MILF peace process. Towards the end of 1999 up to early 2000, the MILF attacked a number of
municipalities in Central Mindanao and, in March 2000, it took control of the town hall of
Kauswagan, Lanao del Norte.3 In response, then President Joseph Estrada declared and carried
out an "all-out-war" against the MILF.

When President Gloria Macapagal-Arroyo assumed office, the military offensive against the
MILF was suspended and the government sought a resumption of the peace talks. The MILF,
according to a leading MILF member, initially responded with deep reservation, but when
President Arroyo asked the Government of Malaysia through Prime Minister Mahathir
Mohammad to help convince the MILF to return to the negotiating table, the MILF convened its
Central Committee to seriously discuss the matter and, eventually, decided to meet with the
GRP.4

The parties met in Kuala Lumpur on March 24, 2001, with the talks being facilitated by the
Malaysian government, the parties signing on the same date the Agreement on the General
Framework for the Resumption of Peace Talks Between the GRP and the MILF. The MILF
thereafter suspended all its military actions.5

Formal peace talks between the parties were held in Tripoli, Libya from June 20-22, 2001, the
outcome of which was the GRP-MILF Tripoli Agreement on Peace (Tripoli Agreement 2001)
containing the basic principles and agenda on the following aspects of the negotiation: Security
Aspect, Rehabilitation Aspect, and Ancestral Domain Aspect. With regard to the Ancestral
Domain Aspect, the parties in Tripoli Agreement 2001 simply agreed "that the same be discussed
further by the Parties in their next meeting."

A second round of peace talks was held in Cyberjaya, Malaysia on August 5-7, 2001 which
ended with the signing of the Implementing Guidelines on the Security Aspect of the Tripoli
Agreement 2001 leading to a ceasefire status between the parties. This was followed by the
Implementing Guidelines on the Humanitarian Rehabilitation and Development Aspects of the
Tripoli Agreement 2001, which was signed on May 7, 2002 at Putrajaya, Malaysia. Nonetheless,
there were many incidence of violence between government forces and the MILF from 2002 to
2003.

Meanwhile, then MILF Chairman Salamat Hashim passed away on July 13, 2003 and he was
replaced by Al Haj Murad, who was then the chief peace negotiator of the MILF. Murad's
position as chief peace negotiator was taken over by Mohagher Iqbal.6
In 2005, several exploratory talks were held between the parties in Kuala Lumpur, eventually
leading to the crafting of the draft MOA-AD in its final form, which, as mentioned, was set to be
signed last August 5, 2008.

II. STATEMENT OF THE PROCEEDINGS

Before the Court is what is perhaps the most contentious "consensus" ever embodied in an
instrument - the MOA-AD which is assailed principally by the present petitions bearing docket
numbers 183591, 183752, 183893, 183951 and 183962.

Commonly impleaded as respondents are the GRP Peace Panel on Ancestral Domain7 and the
Presidential Adviser on the Peace Process (PAPP) Hermogenes Esperon, Jr.

On July 23, 2008, the Province of North Cotabato8 and Vice-Governor Emmanuel Piñol filed a
petition, docketed as G.R. No. 183591, for Mandamus and Prohibition with Prayer for the
Issuance of Writ of Preliminary Injunction and Temporary Restraining Order.9 Invoking the right
to information on matters of public concern, petitioners seek to compel respondents to disclose
and furnish them the complete and official copies of the MOA-AD including its attachments, and
to prohibit the slated signing of the MOA-AD, pending the disclosure of the contents of the
MOA-AD and the holding of a public consultation thereon. Supplementarily, petitioners pray
that the MOA-AD be declared unconstitutional.10

This initial petition was followed by another one, docketed as G.R. No. 183752, also for
Mandamus and Prohibition11 filed by the City of Zamboanga,12 Mayor Celso Lobregat, Rep. Ma.
Isabelle Climaco and Rep. Erico Basilio Fabian who likewise pray for similar injunctive reliefs.
Petitioners herein moreover pray that the City of Zamboanga be excluded from the Bangsamoro
Homeland and/or Bangsamoro Juridical Entity and, in the alternative, that the MOA-AD be
declared null and void.

By Resolution of August 4, 2008, the Court issued a Temporary Restraining Order commanding
and directing public respondents and their agents to cease and desist from formally signing the
MOA-AD.13 The Court also required the Solicitor General to submit to the Court and petitioners
the official copy of the final draft of the MOA-AD,14 to which she complied.15

Meanwhile, the City of Iligan16 filed a petition for Injunction and/or Declaratory Relief, docketed
as G.R. No. 183893, praying that respondents be enjoined from signing the MOA-AD or, if the
same had already been signed, from implementing the same, and that the MOA-AD be declared
unconstitutional. Petitioners herein additionally implead Executive Secretary Eduardo Ermita as
respondent.

The Province of Zamboanga del Norte,17 Governor Rolando Yebes, Vice-Governor Francis
Olvis, Rep. Cecilia Jalosjos-Carreon, Rep. Cesar Jalosjos, and the members18 of the Sangguniang
Panlalawigan of Zamboanga del Norte filed on August 15, 2008 a petition for Certiorari,
Mandamus and Prohibition,19 docketed as G.R. No. 183951. They pray, inter alia, that the
MOA-AD be declared null and void and without operative effect, and that respondents be
enjoined from executing the MOA-AD.
On August 19, 2008, Ernesto Maceda, Jejomar Binay, and Aquilino Pimentel III filed a petition
for Prohibition,20 docketed as G.R. No. 183962,praying for a judgment prohibiting and
permanently enjoining respondents from formally signing and executing the MOA-AD and or
any other agreement derived therefrom or similar thereto, and nullifying the MOA-AD for being
unconstitutional and illegal. Petitioners herein additionally implead as respondent the MILF
Peace Negotiating Panel represented by its Chairman Mohagher Iqbal.

Various parties moved to intervene and were granted leave of court to file their petitions -
/comments-in-intervention. Petitioners-in-Intervention include Senator Manuel A. Roxas, former
Senate President Franklin Drilon and Atty. Adel Tamano, the City of Isabela21 and Mayor
Cherrylyn Santos-Akbar, the Province of Sultan Kudarat22 and Gov. Suharto Mangudadatu, the
Municipality of Linamon in Lanao del Norte,23 Ruy Elias Lopez of Davao City and of the
Bagobo tribe, Sangguniang Panlungsod member Marino Ridao and businessman Kisin Buxani,
both of Cotabato City; and lawyers Carlo Gomez, Gerardo Dilig, Nesario Awat, Joselito Alisuag,
Richalex Jagmis, all of Palawan City. The Muslim Legal Assistance Foundation, Inc. (Muslaf)
and the Muslim Multi-Sectoral Movement for Peace and Development (MMMPD) filed their
respective Comments-in-Intervention.

By subsequent Resolutions, the Court ordered the consolidation of the petitions. Respondents
filed Comments on the petitions, while some of petitioners submitted their respective Replies.

Respondents, by Manifestation and Motion of August 19, 2008, stated that the Executive
Department shall thoroughly review the MOA-AD and pursue further negotiations to address the
issues hurled against it, and thus moved to dismiss the cases. In the succeeding exchange of
pleadings, respondents' motion was met with vigorous opposition from petitioners.

The cases were heard on oral argument on August 15, 22 and 29, 2008 that tackled the following
principal issues:

1. Whether the petitions have become moot and academic

(i) insofar as the mandamus aspect is concerned, in view of the disclosure of official copies of
the final draft of the Memorandum of Agreement (MOA); and cralawlibrary

(ii) insofar as the prohibition aspect involving the Local Government Units is concerned, if it is
considered that consultation has become fait accompli with the finalization of the draft;

2. Whether the constitutionality and the legality of the MOA is ripe for adjudication;

3. Whether respondent Government of the Republic of the Philippines Peace Panel committed
grave abuse of discretion amounting to lack or excess of jurisdiction when it negotiated and
initiated the MOA vis - à-vis ISSUES Nos. 4 and 5;

4. Whether there is a violation of the people's right to information on matters of public concern
(1987 Constitution, Article III, Sec. 7) under a state policy of full disclosure of all its transactions
involving public interest (1987 Constitution, Article II, Sec. 28) including public consultation
under Republic Act No. 7160 (LOCAL GOVERNMENT CODE OF 1991)[;]

If it is in the affirmative, whether prohibition under Rule 65 of the 1997 Rules of Civil Procedure
is an appropriate remedy;

5. Whether by signing the MOA, the Government of the Republic of the Philippines would be
BINDING itself

a) to create and recognize the Bangsamoro Juridical Entity (BJE) as a separate state, or a
juridical, territorial or political subdivision not recognized by law;

b) to revise or amend the Constitution and existing laws to conform to the MOA;

c) to concede to or recognize the claim of the Moro Islamic Liberation Front for ancestral
domain in violation of Republic Act No. 8371 (THE INDIGENOUS PEOPLES RIGHTS ACT
OF 1997), particularly Section 3(g) & Chapter VII (DELINEATION, RECOGNITION OF
ANCESTRAL DOMAINS)[;]

If in the affirmative, whether the Executive Branch has the authority to so bind the Government
of the Republic of the Philippines;

6. Whether the inclusion/exclusion of the Province of North Cotabato, Cities of Zamboanga,

Iligan and Isabela, and the Municipality of Linamon, Lanao del Norte in/from the areas covered
by the projected Bangsamoro Homeland is a justiciable question; and cralawlibrary

7. Whether desistance from signing the MOA derogates any prior valid commitments of the
Government of the Republic of the Philippines.24

The Court, thereafter, ordered the parties to submit their respective Memoranda. Most of the
parties submitted their memoranda on time.

III. OVERVIEW OF THE MOA-AD

As a necessary backdrop to the consideration of the objections raised in the subject five petitions
and six petitions-in-intervention against the MOA-AD, as well as the two comments-in-
intervention in favor of the MOA-AD, the Court takes an overview of the MOA.

The MOA-AD identifies the Parties to it as the GRP and the MILF.

Under the heading "Terms of Reference" (TOR), the MOA-AD includes not only four earlier
agreements between the GRP and MILF, but also two agreements between the GRP and the
MNLF: the 1976 Tripoli Agreement, and the Final Peace Agreement on the Implementation of
the 1976 Tripoli Agreement, signed on September 2, 1996 during the administration of President
Fidel Ramos.
The MOA-AD also identifies as TOR two local statutes - the organic act for the Autonomous
Region in Muslim Mindanao (ARMM)25 and the Indigenous Peoples Rights Act (IPRA),26 and
several international law instruments - the ILO Convention No. 169 Concerning Indigenous and
Tribal Peoples in Independent Countries in relation to the UN Declaration on the Rights of the
Indigenous Peoples, and the UN Charter, among others.

The MOA-AD includes as a final TOR the generic category of "compact rights entrenchment
emanating from the regime of dar-ul-mua'hada (or territory under compact) and dar-ul-sulh (or
territory under peace agreement) that partakes the nature of a treaty device."

During the height of the Muslim Empire, early Muslim jurists tended to see the world through a
simple dichotomy: there was the dar-ul-Islam (the Abode of Islam) and dar-ul-harb (the Abode
of War). The first referred to those lands where Islamic laws held sway, while the second
denoted those lands where Muslims were persecuted or where Muslim laws were outlawed or
ineffective.27 This way of viewing the world, however, became more complex through the
centuries as the Islamic world became part of the international community of nations.

As Muslim States entered into treaties with their neighbors, even with distant States and inter-
governmental organizations, the classical division of the world into dar-ul-Islam and dar-ul-harb
eventually lost its meaning. New terms were drawn up to describe novel ways of perceiving non-
Muslim territories. For instance, areas like dar-ul-mua'hada (land of compact) and dar-ul-sulh
(land of treaty) referred to countries which, though under a secular regime, maintained peaceful
and cooperative relations with Muslim States, having been bound to each other by treaty or
agreement. Dar-ul-aman (land of order), on the other hand, referred to countries which, though
not bound by treaty with Muslim States, maintained freedom of religion for Muslims.28

It thus appears that the "compact rights entrenchment" emanating from the regime of dar-ul-
mua'hada and dar-ul-sulh simply refers to all other agreements between the MILF and the
Philippine government - the Philippines being the land of compact and peace agreement - that
partake of the nature of a treaty device, "treaty" being broadly defined as "any solemn agreement
in writing that sets out understandings, obligations, and benefits for both parties which provides
for a framework that elaborates the principles declared in the [MOA-AD]."29

The MOA-AD states that the Parties "HAVE AGREED AND ACKNOWLEDGED AS
FOLLOWS," and starts with its main body.

The main body of the MOA-AD is divided into four strands, namely, Concepts and
Principles, Territory, Resources, and Governance.

A. CONCEPTS AND PRINCIPLES

This strand begins with the statement that it is "the birthright of all Moros and all Indigenous
peoples of Mindanao to identify themselves and be accepted as 'Bangsamoros.'" It defines
"Bangsamoro people" as the natives or original inhabitants of Mindanao and its adjacent islands
including Palawan and the Sulu archipelago at the time of conquest or colonization, and their
descendants whether mixed or of full blood, including their spouses.30
Thus, the concept of "Bangsamoro," as defined in this strand of the MOA-AD, includes not only
"Moros" as traditionally understood even by Muslims,31 but all indigenous peoples of Mindanao
and its adjacent islands. The MOA-AD adds that the freedom of choice of indigenous peoples
shall be respected. What this freedom of choice consists in has not been specifically defined.

The MOA-AD proceeds to refer to the "Bangsamoro homeland," the ownership of which is
vested exclusively in the Bangsamoro people by virtue of their prior rights of occupation.32 Both
parties to the MOA-AD acknowledge that ancestral domain does not form part of the public
domain.33

The Bangsamoro people are acknowledged as having the right to self-governance, which right is
said to be rooted on ancestral territoriality exercised originally under the suzerain authority of
their sultanates and the Pat a Pangampong ku Ranaw. The sultanates were described as states or
"karajaan/kadatuan" resembling a body politic endowed with all the elements of a nation-state in
the modern sense.34

The MOA-AD thus grounds the right to self-governance of the Bangsamoro people on the past
suzerain authority of the sultanates. As gathered, the territory defined as the Bangsamoro
homeland was ruled by several sultanates and, specifically in the case of the Maranao, by the Pat
a Pangampong ku Ranaw, a confederation of independent principalities (pangampong) each
ruled by datus and sultans, none of whom was supreme over the others.35

The MOA-AD goes on to describe the Bangsamoro people as "the 'First Nation' with defined
territory and with a system of government having entered into treaties of amity and commerce
with foreign nations."

The term "First Nation" is of Canadian origin referring to the indigenous peoples of that
territory, particularly those known as Indians. In Canada, each of these indigenous peoples is
equally entitled to be called "First Nation," hence, all of them are usually described collectively
by the plural "First Nations."36 To that extent, the MOA-AD, by identifying the Bangsamoro
people as "the First Nation" - suggesting its exclusive entitlement to that designation - departs
from the Canadian usage of the term.

The MOA-AD then mentions for the first time the "Bangsamoro Juridical Entity" (BJE) to
which it grants the authority and jurisdiction over the Ancestral Domain and Ancestral Lands of
the Bangsamoro.37

B. TERRITORY

The territory of the Bangsamoro homeland is described as the land mass as well as the maritime,
terrestrial, fluvial and alluvial domains, including the aerial domain and the atmospheric space
above it, embracing the Mindanao-Sulu-Palawan geographic region.38

More specifically, the core of the BJE is defined as the present geographic area of the ARMM -
thus constituting the following areas: Lanao del Sur, Maguindanao, Sulu, Tawi-Tawi, Basilan,
and Marawi City. Significantly, this core also includes certain municipalities of Lanao del Norte
that voted for inclusion in the ARMM in the 2001 plebiscite.39

Outside of this core, the BJE is to cover other provinces, cities, municipalities and barangays,
which are grouped into two categories, Category A and Category B. Each of these areas is to be
subjected to a plebiscite to be held on different dates, years apart from each other. Thus,
Category A areas are to be subjected to a plebiscite not later than twelve (12) months following
the signing of the MOA-AD.40 Category B areas, also called "Special Intervention Areas," on the
other hand, are to be subjected to a plebiscite twenty-five (25) years from the signing of a
separate agreement - the Comprehensive Compact.41

The Parties to the MOA-AD stipulate that the BJE shall have jurisdiction over all natural
resources within its "internal waters," defined as extending fifteen (15) kilometers from the
coastline of the BJE area;42 that the BJE shall also have "territorial waters," which shall stretch
beyond the BJE internal waters up to the baselines of the Republic of the Philippines (RP) south
east and south west of mainland Mindanao; and that within these territorial waters, the BJE and
the "Central Government" (used interchangeably with RP) shall exercise joint jurisdiction,
authority and management over all natural resources.43 Notably, the jurisdiction over the internal
waters is not similarly described as "joint."

The MOA-AD further provides for the sharing of minerals on the territorial waters between the
Central Government and the BJE, in favor of the latter, through production sharing and economic
cooperation agreement.44 The activities which the Parties are allowed to conduct on the
territorial waters are enumerated, among which are the exploration and utilization of natural
resources, regulation of shipping and fishing activities, and the enforcement of police and safety
measures.45 There is no similar provision on the sharing of minerals and allowed activities with
respect to the internal waters of the BJE.

C. RESOURCES

The MOA-AD states that the BJE is free to enter into any economic cooperation and trade
relations with foreign countries and shall have the option to establish trade missions in those
countries. Such relationships and understandings, however, are not to include aggression against
the GRP. The BJE may also enter into environmental cooperation agreements.46

The external defense of the BJE is to remain the duty and obligation of the Central Government.
The Central Government is also bound to "take necessary steps to ensure the BJE's participation
in international meetings and events" like those of the ASEAN and the specialized agencies of
the UN. The BJE is to be entitled to participate in Philippine official missions and delegations for
the negotiation of border agreements or protocols for environmental protection and equitable
sharing of incomes and revenues involving the bodies of water adjacent to or between the islands
forming part of the ancestral domain.47

With regard to the right of exploring for, producing, and obtaining all potential sources of
energy, petroleum, fossil fuel, mineral oil and natural gas, the jurisdiction and control thereon is
to be vested in the BJE "as the party having control within its territorial jurisdiction." This right
carries the proviso that, "in times of national emergency, when public interest so requires," the
Central Government may, for a fixed period and under reasonable terms as may be agreed upon
by both Parties, assume or direct the operation of such resources.48

The sharing between the Central Government and the BJE of total production pertaining to
natural resources is to be 75:25 in favor of the BJE.49

The MOA-AD provides that legitimate grievances of the Bangsamoro people arising from any
unjust dispossession of their territorial and proprietary rights, customary land tenures, or their
marginalization shall be acknowledged. Whenever restoration is no longer possible, reparation is
to be in such form as mutually determined by the Parties.50

The BJE may modify or cancel the forest concessions, timber licenses, contracts or agreements,
mining concessions, Mineral Production and Sharing Agreements (MPSA), Industrial Forest
Management Agreements (IFMA), and other land tenure instruments granted by the Philippine
Government, including those issued by the present ARMM.51

D. GOVERNANCE

The MOA-AD binds the Parties to invite a multinational third-party to observe and monitor the
implementation of the Comprehensive Compact. This compact is to embody the "details for the
effective enforcement" and "the mechanisms and modalities for the actual implementation" of
the MOA-AD. The MOA-AD explicitly provides that the participation of the third party shall not
in any way affect the status of the relationship between the Central Government and the BJE.52

The "associative" relationship

between the Central Government
and the BJE

The MOA-AD describes the relationship of the Central Government and the BJE as
"associative," characterized by shared authority and responsibility. And it states that the structure
of governance is to be based on executive, legislative, judicial, and administrative institutions
with defined powers and functions in the Comprehensive Compact.

The MOA-AD provides that its provisions requiring "amendments to the existing legal
framework" shall take effect upon signing of the Comprehensive Compact and upon effecting the
aforesaid amendments, with due regard to the non-derogation of prior agreements and within
the stipulated timeframe to be contained in the Comprehensive Compact. As will be discussed
later, much of the present controversy hangs on the legality of this provision.

The BJE is granted the power to build, develop and maintain its own institutions inclusive of
civil service, electoral, financial and banking, education, legislation, legal, economic, police and
internal security force, judicial system and correctional institutions, the details of which shall be
discussed in the negotiation of the comprehensive compact.
As stated early on, the MOA-AD was set to be signed on August 5, 2008 by Rodolfo Garcia and
Mohagher Iqbal, Chairpersons of the Peace Negotiating Panels of the GRP and the MILF,
respectively. Notably, the penultimate paragraph of the MOA-AD identifies the signatories as
"the representatives of the Parties," meaning the GRP and MILF themselves, and not merely of
the negotiating panels.53 In addition, the signature page of the MOA-AD states that it is
"WITNESSED BY" Datuk Othman Bin Abd Razak, Special Adviser to the Prime Minister of
Malaysia, "ENDORSED BY" Ambassador Sayed Elmasry, Adviser to Organization of the
Islamic Conference (OIC) Secretary General and Special Envoy for Peace Process in Southern
Philippines, and SIGNED "IN THE PRESENCE OF" Dr. Albert G. Romulo, Secretary of
Foreign Affairs of RP and Dato' Seri Utama Dr. Rais Bin Yatim, Minister of Foreign Affairs,
Malaysia, all of whom were scheduled to sign the Agreement last August 5, 2008.

Annexed to the MOA-AD are two documents containing the respective lists cum maps of the
provinces, municipalities, and barangays under Categories A and B earlier mentioned in the
discussion on the strand on TERRITORY.

IV. PROCEDURAL ISSUES

A. RIPENESS

The power of judicial review is limited to actual cases or controversies.54 Courts decline to issue
advisory opinions or to resolve hypothetical or feigned problems, or mere academic questions.55
The limitation of the power of judicial review to actual cases and controversies defines the role
assigned to the judiciary in a tripartite allocation of power, to assure that the courts will not
intrude into areas committed to the other branches of government.56

An actual case or controversy involves a conflict of legal rights, an assertion of opposite legal
claims, susceptible of judicial resolution as distinguished from a hypothetical or abstract
difference or dispute. There must be a contrariety of legal rights that can be interpreted and
enforced on the basis of existing law and jurisprudence.57 The Court can decide the
constitutionality of an act or treaty only when a proper case between opposing parties is
submitted for judicial determination.58

Related to the requirement of an actual case or controversy is the requirement of ripeness. A

question is ripe for adjudication when the act being challenged has had a direct adverse effect on
the individual challenging it.59 For a case to be considered ripe for adjudication, it is a
prerequisite that something had then been accomplished or performed by either branch before a
court may come into the picture,60 and the petitioner must allege the existence of an immediate or
threatened injury to itself as a result of the challenged action.61 He must show that he has
sustained or is immediately in danger of sustaining some direct injury as a result of the act
complained of.62

The Solicitor General argues that there is no justiciable controversy that is ripe for judicial
review in the present petitions, reasoning that
The unsigned MOA-AD is simply a list of consensus points subject to further negotiations and
legislative enactments as well as constitutional processes aimed at attaining a final peaceful
agreement. Simply put, the MOA-AD remains to be a proposal that does not automatically create
legally demandable rights and obligations until the list of operative acts required have been duly
complied with. x x x

xxx

In the cases at bar, it is respectfully submitted that this Honorable Court has no authority to pass
upon issues based on hypothetical or feigned constitutional problems or interests with no
concrete bases. Considering the preliminary character of the MOA-AD, there are no concrete
acts that could possibly violate petitioners' and intervenors' rights since the acts complained of
are mere contemplated steps toward the formulation of a final peace agreement. Plainly,
petitioners and intervenors' perceived injury, if at all, is merely imaginary and illusory apart from
being unfounded and based on mere conjectures. (Underscoring supplied) cralawlibrary

The Solicitor General cites63 the following provisions of the MOA-AD:

TERRITORY

xxx

2. Toward this end, the Parties enter into the following stipulations:

xxx

d. Without derogating from the requirements of prior agreements, the Government stipulates to
conduct and deliver, using all possible legal measures, within twelve (12) months following the
signing of the MOA-AD, a plebiscite covering the areas as enumerated in the list and depicted in
the map as Category A attached herein (the "Annex"). The Annex constitutes an integral part of
this framework agreement. Toward this end, the Parties shall endeavor to complete the
negotiations and resolve all outstanding issues on the Comprehensive Compact within fifteen
(15) months from the signing of the MOA-AD.

xxx

GOVERNANCE

xxx

7. The Parties agree that mechanisms and modalities for the actual implementation of this MOA-
AD shall be spelt out in the Comprehensive Compact to mutually take such steps to enable it to
occur effectively.

Any provisions of the MOA-AD requiring amendments to the existing legal framework shall
come into force upon the signing of a Comprehensive Compact and upon effecting the necessary
changes to the legal framework with due regard to non-derogation of prior agreements and
within the stipulated timeframe to be contained in the Comprehensive Compact.64 (Underscoring
supplied)cralawlibrary

The Solicitor General's arguments fail to persuade.

Concrete acts under the MOA-AD are not necessary to render the present controversy ripe. In
Pimentel, Jr. v. Aguirre,65 this Court held:

x x x [B]y the mere enactment of the questioned law or the approval of the challenged action, the
dispute is said to have ripened into a judicial controversy even without any other overt act.
Indeed, even a singular violation of the Constitution and/or the law is enough to awaken judicial
duty.

xxx

By the same token, when an act of the President, who in our constitutional scheme is a coequal
of Congress, is seriously alleged to have infringed the Constitution and the laws x x x settling the
dispute becomes the duty and the responsibility of the courts.66

In Santa Fe Independent School District v. Doe,67 the United States Supreme Court held that the
challenge to the constitutionality of the school's policy allowing student-led prayers and speeches
before games was ripe for adjudication, even if no public prayer had yet been led under the
policy, because the policy was being challenged as unconstitutional on its face.68

That the law or act in question is not yet effective does not negate ripeness. For example, in New
York v. United States,69 decided in 1992, the United States Supreme Court held that the action by
the State of New York challenging the provisions of the Low-Level Radioactive Waste Policy
Act was ripe for adjudication even if the questioned provision was not to take effect until January
1, 1996, because the parties agreed that New York had to take immediate action to avoid the
provision's consequences.70

The present petitions pray for Certiorari,71 Prohibition, and Mandamus. Certiorari and
Prohibition are remedies granted by law when any tribunal, board or officer has acted, in the case
of certiorari, or is proceeding, in the case of prohibition, without or in excess of its jurisdiction
or with grave abuse of discretion amounting to lack or excess of jurisdiction.72 Mandamus is a
remedy granted by law when any tribunal, corporation, board, officer or person unlawfully
neglects the performance of an act which the law specifically enjoins as a duty resulting from an
office, trust, or station, or unlawfully excludes another from the use or enjoyment of a right or
office to which such other is entitled.73 Certiorari, Mandamus and Prohibition are appropriate
remedies to raise constitutional issues and to review and/or prohibit/nullify, when proper, acts of
legislative and executive officials.74

The authority of the GRP Negotiating Panel is defined by Executive Order No. 3 (E.O. No. 3),
issued on February 28, 2001.75 The said executive order requires that "[t]he government's policy
framework for peace, including the systematic approach and the administrative structure for
carrying out the comprehensive peace process x x x be governed by this Executive Order."76

The present petitions allege that respondents GRP Panel and PAPP Esperon drafted the terms of
the MOA-AD without consulting the local government units or communities affected, nor
informing them of the proceedings. As will be discussed in greater detail later, such omission, by
itself, constitutes a departure by respondents from their mandate under E.O. No. 3.

Furthermore, the petitions allege that the provisions of the MOA-AD violate the Constitution.
The MOA-AD provides that "any provisions of the MOA-AD requiring amendments to the
existing legal framework shall come into force upon the signing of a Comprehensive Compact
and upon effecting the necessary changes to the legal framework," implying an amendment of
the Constitution to accommodate the MOA-AD. This stipulation, in effect, guaranteed to the
MILF the amendment of the Constitution. Such act constitutes another violation of its authority.
Again, these points will be discussed in more detail later.

As the petitions allege acts or omissions on the part of respondent that exceed their authority,
by violating their duties under E.O. No. 3 and the provisions of the Constitution and statutes, the
petitions make a prima facie case for Certiorari, Prohibition, and Mandamus, and an actual case
or controversy ripe for adjudication exists. When an act of a branch of government is
seriously alleged to have infringed the Constitution, it becomes not only the right but in
fact the duty of the judiciary to settle the dispute.77

B. LOCUS STANDI

For a party to have locus standi, one must allege "such a personal stake in the outcome of the
controversy as to assure that concrete adverseness which sharpens the presentation of issues
upon which the court so largely depends for illumination of difficult constitutional questions."78

Because constitutional cases are often public actions in which the relief sought is likely to affect
other persons, a preliminary question frequently arises as to this interest in the constitutional
question raised.79

When suing as a citizen, the person complaining must allege that he has been or is about to be
denied some right or privilege to which he is lawfully entitled or that he is about to be subjected
to some burdens or penalties by reason of the statute or act complained of.80 When the issue
concerns a public right, it is sufficient that the petitioner is a citizen and has an interest in the
execution of the laws.81

For a taxpayer, one is allowed to sue where there is an assertion that public funds are illegally
disbursed or deflected to an illegal purpose, or that there is a wastage of public funds through the
enforcement of an invalid or unconstitutional law.82 The Court retains discretion whether or not
to allow a taxpayer's suit.83

In the case of a legislator or member of Congress, an act of the Executive that injures the
institution of Congress causes a derivative but nonetheless substantial injury that can be
questioned by legislators. A member of the House of Representatives has standing to maintain
inviolate the prerogatives, powers and privileges vested by the Constitution in his office.84

An organization may be granted standing to assert the rights of its members,85 but the mere
invocation by the Integrated Bar of the Philippines or any member of the legal profession of the
duty to preserve the rule of law does not suffice to clothe it with standing.86

As regards a local government unit (LGU), it can seek relief in order to protect or vindicate an
interest of its own, and of the other LGUs.87

Intervenors, meanwhile, may be given legal standing upon showing of facts that satisfy the
requirements of the law authorizing intervention,88 such as a legal interest in the matter in
litigation, or in the success of either of the parties.

In any case, the Court has discretion to relax the procedural technicality on locus standi, given
the liberal attitude it has exercised, highlighted in the case of David v. Macapagal-Arroyo,89
where technicalities of procedure were brushed aside, the constitutional issues raised being of
paramount public interest or of transcendental importance deserving the attention of the Court in
view of their seriousness, novelty and weight as precedents.90 The Court's forbearing stance on
locus standi on issues involving constitutional issues has for its purpose the protection of
fundamental rights.

In not a few cases, the Court, in keeping with its duty under the Constitution to determine
whether the other branches of government have kept themselves within the limits of the
Constitution and the laws and have not abused the discretion given them, has brushed aside
technical rules of procedure.91

In the petitions at bar, petitioners Province of North Cotabato (G.R. No. 183591) Province of
Zamboanga del Norte (G.R. No. 183951), City of Iligan (G.R. No. 183893) and City of
Zamboanga (G.R. No. 183752) and petitioners-in-intervention Province of Sultan Kudarat,
City of Isabela and Municipality of Linamon have locus standi in view of the direct and
substantial injury that they, as LGUs, would suffer as their territories, whether in whole or in
part, are to be included in the intended domain of the BJE. These petitioners allege that they did
not vote for their inclusion in the ARMM which would be expanded to form the BJE territory.
Petitioners' legal standing is thus beyond doubt.

In G.R. No. 183962, petitioners Ernesto Maceda, Jejomar Binay and Aquilino Pimentel III
would have no standing as citizens and taxpayers for their failure to specify that they would be
denied some right or privilege or there would be wastage of public funds. The fact that they are a
former Senator, an incumbent mayor of Makati City, and a resident of Cagayan de Oro,
respectively, is of no consequence. Considering their invocation of the transcendental importance
of the issues at hand, however, the Court grants them standing.

Intervenors Franklin Drilon and Adel Tamano, in alleging their standing as taxpayers, assert
that government funds would be expended for the conduct of an illegal and unconstitutional
plebiscite to delineate the BJE territory. On that score alone, they can be given legal standing.
Their allegation that the issues involved in these petitions are of "undeniable transcendental
importance" clothes them with added basis for their personality to intervene in these petitions.

With regard to Senator Manuel Roxas, his standing is premised on his being a member of the
Senate and a citizen to enforce compliance by respondents of the public's constitutional right to
be informed of the MOA-AD, as well as on a genuine legal interest in the matter in litigation, or
in the success or failure of either of the parties. He thus possesses the requisite standing as an
intervenor.

With respect to Intervenors Ruy Elias Lopez, as a former congressman of the 3rd district of
Davao City, a taxpayer and a member of the Bagobo tribe; Carlo B. Gomez, et al., as members of
the IBP Palawan chapter, citizens and taxpayers; Marino Ridao, as taxpayer, resident and
member of the Sangguniang Panlungsod of Cotabato City; and Kisin Buxani, as taxpayer, they
failed to allege any proper legal interest in the present petitions. Just the same, the Court
exercises its discretion to relax the procedural technicality on locus standi given the paramount
public interest in the issues at hand.

Intervening respondents Muslim Multi-Sectoral Movement for Peace and Development, an

advocacy group for justice and the attainment of peace and prosperity in Muslim Mindanao; and
Muslim Legal Assistance Foundation Inc., a non-government organization of Muslim lawyers,
allege that they stand to be benefited or prejudiced, as the case may be, in the resolution of the
petitions concerning the MOA-AD, and prays for the denial of the petitions on the grounds
therein stated. Such legal interest suffices to clothe them with standing.

B. MOOTNESS

Respondents insist that the present petitions have been rendered moot with the satisfaction of all
the reliefs prayed for by petitioners and the subsequent pronouncement of the Executive
Secretary that "[n]o matter what the Supreme Court ultimately decides[,] the government will not
sign the MOA."92

In lending credence to this policy decision, the Solicitor General points out that the President had
already disbanded the GRP Peace Panel.93

In David v. Macapagal-Arroyo,94 this Court held that the "moot and academic" principle not
being a magical formula that automatically dissuades courts in resolving a case, it will decide
cases, otherwise moot and academic, if it finds that (a) there is a grave violation of the
Constitution;95 (b) the situation is of exceptional character and paramount public interest is
involved;96 (c) the constitutional issue raised requires formulation of controlling principles to
guide the bench, the bar, and the public;97 and (d) the case is capable of repetition yet evading
review.98

Another exclusionary circumstance that may be considered is where there is a voluntary

cessation of the activity complained of by the defendant or doer. Thus, once a suit is filed and the
doer voluntarily ceases the challenged conduct, it does not automatically deprive the tribunal of
power to hear and determine the case and does not render the case moot especially when the
plaintiff seeks damages or prays for injunctive relief against the possible recurrence of the
violation.99

The present petitions fall squarely into these exceptions to thus thrust them into the domain of
judicial review. The grounds cited above in David are just as applicable in the present cases as
they were, not only in David, but also in Province of Batangas v. Romulo100 and Manalo v.
Calderon101 where the Court similarly decided them on the merits, supervening events that would
ordinarily have rendered the same moot notwithstanding.

Petitions not mooted

Contrary then to the asseverations of respondents, the non-signing of the MOA-AD and the
eventual dissolution of the GRP Peace Panel did not moot the present petitions. It bears
emphasis that the signing of the MOA-AD did not push through due to the Court's issuance of a
Temporary Restraining Order.

Contrary too to respondents' position, the MOA-AD cannot be considered a mere "list of
consensus points," especially given its nomenclature, the need to have it signed or initialed by
all the parties concerned on August 5, 2008, and the far-reaching Constitutional implications
of these "consensus points," foremost of which is the creation of the BJE.

In fact, as what will, in the main, be discussed, there is a commitment on the part of
respondents to amend and effect necessary changes to the existing legal framework for
certain provisions of the MOA-AD to take effect. Consequently, the present petitions are not
confined to the terms and provisions of the MOA-AD, but to other on-going and future
negotiations and agreements necessary for its realization. The petitions have not, therefore, been
rendered moot and academic simply by the public disclosure of the MOA-AD,102 the
manifestation that it will not be signed as well as the disbanding of the GRP Panel not
withstanding.

Petitions are imbued with paramount public interest

There is no gainsaying that the petitions are imbued with paramount public interest, involving a
significant part of the country's territory and the wide-ranging political modifications of affected
LGUs. The assertion that the MOA-AD is subject to further legal enactments including
possible Constitutional amendments more than ever provides impetus for the Court to
formulate controlling principles to guide the bench, the bar, the public and, in this case, the
government and its negotiating entity.

Respondents cite Suplico v. NEDA, et al.103 where the Court did not "pontificat[e] on issues
which no longer legitimately constitute an actual case or controversy [as this] will do more harm
than good to the nation as a whole."

The present petitions must be differentiated from Suplico. Primarily, in Suplico, what was
assailed and eventually cancelled was a stand-alone government procurement contract for a
national broadband network involving a one-time contractual relation between two parties-the
government and a private foreign corporation. As the issues therein involved specific
government procurement policies and standard principles on contracts, the majority opinion in
Suplico found nothing exceptional therein, the factual circumstances being peculiar only to the
transactions and parties involved in the controversy.

The MOA-AD is part of a series of agreements

In the present controversy, the MOA-AD is a significant part of a series of agreements

necessary to carry out the Tripoli Agreement 2001. The MOA-AD which dwells on the Ancestral
Domain Aspect of said Tripoli Agreement is the third such component to be undertaken
following the implementation of the Security Aspect in August 2001 and the Humanitarian,
Rehabilitation and Development Aspect in May 2002.

Accordingly, even if the Executive Secretary, in his Memorandum of August 28, 2008 to the
Solicitor General, has stated that "no matter what the Supreme Court ultimately decides[,] the
government will not sign the MOA[-AD]," mootness will not set in in light of the terms of the
Tripoli Agreement 2001.

Need to formulate principles-guidelines

Surely, the present MOA-AD can be renegotiated or another one will be drawn up to carry out
the Ancestral Domain Aspect of the Tripoli Agreement 2001, in another or in any form,
which could contain similar or significantly drastic provisions. While the Court notes the word of
the Executive Secretary that the government "is committed to securing an agreement that is both
constitutional and equitable because that is the only way that long-lasting peace can be assured,"
it is minded to render a decision on the merits in the present petitions to formulate controlling
principles to guide the bench, the bar, the public and, most especially, the government in
negotiating with the MILF regarding Ancestral Domain.

Respondents invite the Court's attention to the separate opinion of then Chief Justice Artemio
Panganiban in Sanlakas v. Reyes104 in which he stated that the doctrine of "capable of repetition
yet evading review" can override mootness, "provided the party raising it in a proper case has
been and/or continue to be prejudiced or damaged as a direct result of their issuance." They
contend that the Court must have jurisdiction over the subject matter for the doctrine to be
invoked.

The present petitions all contain prayers for Prohibition over which this Court exercises original
jurisdiction. While G.R. No. 183893 (City of Iligan v. GRP) is a petition for Injunction and
Declaratory Relief, the Court will treat it as one for Prohibition as it has far reaching implications
and raises questions that need to be resolved.105 At all events, the Court has jurisdiction over
most if not the rest of the petitions.

Indeed, the present petitions afford a proper venue for the Court to again apply the doctrine
immediately referred to as what it had done in a number of landmark cases.106 There is a
reasonable expectation that petitioners, particularly the Provinces of North Cotabato, Zamboanga
del Norte and Sultan Kudarat, the Cities of Zamboanga, Iligan and Isabela, and the Municipality
of Linamon, will again be subjected to the same problem in the future as respondents' actions are
capable of repetition, in another or any form.

It is with respect to the prayers for Mandamus that the petitions have become moot, respondents
having, by Compliance of August 7, 2008, provided this Court and petitioners with official
copies of the final draft of the MOA-AD and its annexes. Too, intervenors have been furnished,
or have procured for themselves, copies of the MOA-AD.

V. SUBSTANTIVE ISSUES

As culled from the Petitions and Petitions-in-Intervention, there are basically two
SUBSTANTIVE issues to be resolved, one relating to the manner in which the MOA-AD was
negotiated and finalized, the other relating to its provisions, viz:

1. Did respondents violate constitutional and statutory provisions on public consultation and the
right to information when they negotiated and later initialed the MOA-AD? cralawred

2. Do the contents of the MOA-AD violate the Constitution and the laws?

ON THE FIRST SUBSTANTIVE ISSUE

Petitioners invoke their constitutional right to information on matters of public concern, as

provided in Section 7, Article III on the Bill of Rights:

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, transactions,
or decisions, as well as to government research data used as basis for policy development, shall
be afforded the citizen, subject to such limitations as may be provided by law.107

As early as 1948, in Subido v. Ozaeta,108 the Court has recognized the statutory right to examine
and inspect public records, a right which was eventually accorded constitutional status.

The right of access to public documents, as enshrined in both the 1973 Constitution and the 1987
Constitution, has been recognized as a self-executory constitutional right.109

In the 1976 case of Baldoza v. Hon. Judge Dimaano,110 the Court ruled that access to public
records is predicated on the right of the people to acquire information on matters of public
concern since, undoubtedly, in a democracy, the pubic has a legitimate interest in matters of
social and political significance.

x x x The incorporation of this right in the Constitution is a recognition of the fundamental role
of free exchange of information in a democracy. There can be no realistic perception by the
public of the nation's problems, nor a meaningful democratic decision-making if they are denied
access to information of general interest. Information is needed to enable the members of society
to cope with the exigencies of the times. As has been aptly observed: "Maintaining the flow of
such information depends on protection for both its acquisition and its dissemination since, if
either process is interrupted, the flow inevitably ceases." x x x111

In the same way that free discussion enables members of society to cope with the exigencies of
their time, access to information of general interest aids the people in democratic decision-
making by giving them a better perspective of the vital issues confronting the nation
112
so that they may be able to criticize and participate in the affairs of the government in a
responsible, reasonable and effective manner. It is by ensuring an unfettered and uninhibited
exchange of ideas among a well-informed public that a government remains responsive to the
changes desired by the people.113

The MOA-AD is a matter of public concern

That the subject of the information sought in the present cases is a matter of public concern114
faces no serious challenge. In fact, respondents admit that the MOA-AD is indeed of public
concern.115 In previous cases, the Court found that the regularity of real estate transactions
entered in the Register of Deeds,116 the need for adequate notice to the public of the various
laws,117 the civil service eligibility of a public employee,118 the proper management of GSIS
funds allegedly used to grant loans to public officials,119 the recovery of the Marcoses' alleged ill-
gotten wealth,120 and the identity of party-list nominees,121 among others, are matters of public
concern. Undoubtedly, the MOA-AD subject of the present cases is of public concern, involving
as it does the sovereignty and territorial integrity of the State, which directly affects the lives of
the public at large.

Matters of public concern covered by the right to information include steps and negotiations
leading to the consummation of the contract. In not distinguishing as to the executory nature or
commercial character of agreements, the Court has categorically ruled:

x x x [T]he right to information "contemplates inclusion of negotiations leading to the

consummation of the transaction." Certainly, a consummated contract is not a requirement for
the exercise of the right to information. Otherwise, the people can never exercise the right if no
contract is consummated, and if one is consummated, it may be too late for the public to expose
its defects.

Requiring a consummated contract will keep the public in the dark until the contract, which may
be grossly disadvantageous to the government or even illegal, becomes fait accompli. This
negates the State policy of full transparency on matters of public concern, a situation which the
framers of the Constitution could not have intended. Such a requirement will prevent the
citizenry from participating in the public discussion of any proposed contract, effectively
truncating a basic right enshrined in the Bill of Rights. We can allow neither an emasculation of
a constitutional right, nor a retreat by the State of its avowed "policy of full disclosure of all its
transactions involving public interest."122 (Emphasis and italics in the original)

Intended as a "splendid symmetry"123 to the right to information under the Bill of Rights is the
policy of public disclosure under Section 28, Article II of the Constitution reading:
Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and implements a
policy of full public disclosure of all its transactions involving public interest.124

The policy of full public disclosure enunciated in above-quoted Section 28 complements the right
of access to information on matters of public concern found in the Bill of Rights. The right to
information guarantees the right of the people to demand information, while Section 28
recognizes the duty of officialdom to give information even if nobody demands.125

The policy of public disclosure establishes a concrete ethical principle for the conduct of public
affairs in a genuinely open democracy, with the people's right to know as the centerpiece. It is a
mandate of the State to be accountable by following such policy.126 These provisions are vital to
the exercise of the freedom of expression and essential to hold public officials at all times
accountable to the people.127

Whether Section 28 is self-executory, the records of the deliberations of the Constitutional

Commission so disclose:

MR. SUAREZ. And since this is not self-executory, this policy will not be enunciated or will not
be in force and effect until after Congress shall have provided it.

MR. OPLE. I expect it to influence the climate of public ethics immediately but, of course, the
implementing law will have to be enacted by Congress, Mr. Presiding Officer.128

The following discourse, after Commissioner Hilario Davide, Jr., sought clarification on the
issue, is enlightening.

MR. DAVIDE. I would like to get some clarifications on this. Mr. Presiding Officer, did I get the
Gentleman correctly as having said that this is not a self-executing provision? It would require a
legislation by Congress to implement? cralawred

MR. OPLE. Yes. Originally, it was going to be self-executing, but I accepted an amendment
from Commissioner Regalado, so that the safeguards on national interest are modified by the
clause "as may be provided by law"

MR. DAVIDE. But as worded, does it not mean that this will immediately take effect and
Congress may provide for reasonable safeguards on the sole ground national interest? cralawred

MR. OPLE. Yes. I think so, Mr. Presiding Officer, I said earlier that it should immediately
influence the climate of the conduct of public affairs but, of course, Congress here may no
longer pass a law revoking it, or if this is approved, revoking this principle, which is inconsistent
with this policy.129 (Emphasis supplied) cralawlibrary

Indubitably, the effectivity of the policy of public disclosure need not await the passing of a
statute. As Congress cannot revoke this principle, it is merely directed to provide for
"reasonable safeguards." The complete and effective exercise of the right to information
necessitates that its complementary provision on public disclosure derive the same self-executory
nature. Since both provisions go hand-in-hand, it is absurd to say that the broader130 right to
information on matters of public concern is already enforceable while the correlative duty of the
State to disclose its transactions involving public interest is not enforceable until there is an
enabling law. Respondents cannot thus point to the absence of an implementing legislation as an
excuse in not effecting such policy.

An essential element of these freedoms is to keep open a continuing dialogue or process of

communication between the government and the people. It is in the interest of the State that the
channels for free political discussion be maintained to the end that the government may perceive
and be responsive to the people's will.131 Envisioned to be corollary to the twin rights to
information and disclosure is the design for feedback mechanisms.

MS. ROSARIO BRAID. Yes. And lastly, Mr. Presiding Officer, will the people be able to
participate? Will the government provide feedback mechanisms so that the people can
participate and can react where the existing media facilities are not able to provide full
feedback mechanisms to the government? I suppose this will be part of the government
implementing operational mechanisms.

MR. OPLE. Yes. I think through their elected representatives and that is how these courses take
place. There is a message and a feedback, both ways.

xxx

MS. ROSARIO BRAID. Mr. Presiding Officer, may I just make one last sentence? cralawred

I think when we talk about the feedback network, we are not talking about public officials
but also network of private business o[r] community-based organizations that will be
reacting. As a matter of fact, we will put more credence or credibility on the private network of
volunteers and voluntary community-based organizations. So I do not think we are afraid that
there will be another OMA in the making.132 (Emphasis supplied) cralawlibrary

The imperative of a public consultation, as a species of the right to information, is evident in the
"marching orders" to respondents. The mechanics for the duty to disclose information and to
conduct public consultation regarding the peace agenda and process is manifestly provided by
E.O. No. 3.133 The preambulatory clause of E.O. No. 3 declares that there is a need to further
enhance the contribution of civil society to the comprehensive peace process by institutionalizing
the people's participation.

One of the three underlying principles of the comprehensive peace process is that it "should be
community-based, reflecting the sentiments, values and principles important to all Filipinos" and
"shall be defined not by the government alone, nor by the different contending groups only, but
by all Filipinos as one community."134 Included as a component of the comprehensive peace
process is consensus-building and empowerment for peace, which includes "continuing
consultations on both national and local levels to build consensus for a peace agenda and
process, and the mobilization and facilitation of people's participation in the peace process."135
Clearly, E.O. No. 3 contemplates not just the conduct of a plebiscite to effectuate
"continuing" consultations, contrary to respondents' position that plebiscite is "more than
sufficient consultation."136

Further, E.O. No. 3 enumerates the functions and responsibilities of the PAPP, one of which is to
"[c]onduct regular dialogues with the National Peace Forum (NPF) and other peace partners to
seek relevant information, comments, recommendations as well as to render appropriate and
timely reports on the progress of the comprehensive peace process."137 E.O. No. 3 mandates the
establishment of the NPF to be "the principal forum for the PAPP to consult with and seek
advi[c]e from the peace advocates, peace partners and concerned sectors of society on both
national and local levels, on the implementation of the comprehensive peace process, as well as
for government[-]civil society dialogue and consensus-building on peace agenda and
initiatives."138

In fine, E.O. No. 3 establishes petitioners' right to be consulted on the peace agenda, as a
corollary to the constitutional right to information and disclosure.

PAPP Esperon committed grave abuse of discretion

The PAPP committed grave abuse of discretion when he failed to carry out the pertinent
consultation. The furtive process by which the MOA-AD was designed and crafted runs
contrary to and in excess of the legal authority, and amounts to a whimsical, capricious,
oppressive, arbitrary and despotic exercise thereof.

The Court may not, of course, require the PAPP to conduct the consultation in a particular way
or manner. It may, however, require him to comply with the law and discharge the functions
within the authority granted by the President.139

Petitioners are not claiming a seat at the negotiating table, contrary to respondents' retort in
justifying the denial of petitioners' right to be consulted. Respondents' stance manifests the
manner by which they treat the salient provisions of E.O. No. 3 on people's participation. Such
disregard of the express mandate of the President is not much different from superficial conduct
toward token provisos that border on classic lip service.140 It illustrates a gross evasion of
positive duty and a virtual refusal to perform the duty enjoined.

As for respondents' invocation of the doctrine of executive privilege, it is not tenable under the
premises. The argument defies sound reason when contrasted with E.O. No. 3's explicit
provisions on continuing consultation and dialogue on both national and local levels. The
executive order even recognizes the exercise of the public's right even before the GRP makes
its official recommendations or before the government proffers its definite propositions.141 It bear
emphasis that E.O. No. 3 seeks to elicit relevant advice, information, comments and
recommendations from the people through dialogue.

AT ALL EVENTS, respondents effectively waived the defense of executive privilege in view of
their unqualified disclosure of the official copies of the final draft of the MOA-AD. By
unconditionally complying with the Court's August 4, 2008 Resolution, without a prayer for the
document's disclosure in camera, or without a manifestation that it was complying therewith ex
abundante ad cautelam.

Petitioners' assertion that the Local Government Code (LGC) of 1991 declares it a State policy to
"require all national agencies and offices to conduct periodic consultations with appropriate local
government units, non-governmental and people's organizations, and other concerned sectors of
the community before any project or program is implemented in their respective jurisdictions"142
is well-taken. The LGC chapter on intergovernmental relations puts flesh into this avowed
policy:

Prior Consultations Required. - No project or program shall be implemented by government

authorities unless the consultations mentioned in Sections 2 (c) and 26 hereof are complied with,
and prior approval of the sanggunian concerned is obtained: Provided, That occupants in areas
where such projects are to be implemented shall not be evicted unless appropriate relocation sites
have been provided, in accordance with the provisions of the Constitution.143 (Italics and
underscoring supplied)

In Lina, Jr. v. Hon. Paño,144 the Court held that the above-stated policy and above-quoted
provision of the LGU apply only to national programs or projects which are to be implemented
in a particular local community. Among the programs and projects covered are those that are
critical to the environment and human ecology including those that may call for the eviction of a
particular group of people residing in the locality where these will be implemented.145 The
MOA-AD is one peculiar program that unequivocally and unilaterally vests ownership of a
vast territory to the Bangsamoro people,146 which could pervasively and drastically result
to the diaspora or displacement of a great number of inhabitants from their total
environment.

With respect to the indigenous cultural communities/indigenous peoples (ICCs/IPs), whose

interests are represented herein by petitioner Lopez and are adversely affected by the MOA-AD,
the ICCs/IPs have, under the IPRA, the right to participate fully at all levels of decision-making
in matters which may affect their rights, lives and destinies.147 The MOA-AD, an instrument
recognizing ancestral domain, failed to justify its non-compliance with the clear-cut mechanisms
ordained in said Act,148 which entails, among other things, the observance of the free and prior
informed consent of the ICCs/IPs.

Notably, the IPRA does not grant the Executive Department or any government agency the
power to delineate and recognize an ancestral domain claim by mere agreement or compromise.
The recognition of the ancestral domain is the raison d'etre of the MOA-AD, without which all
other stipulations or "consensus points" necessarily must fail. In proceeding to make a sweeping
declaration on ancestral domain, without complying with the IPRA, which is cited as one of the
TOR of the MOA-AD, respondents clearly transcended the boundaries of their authority.
As it seems, even the heart of the MOA-AD is still subject to necessary changes to the legal
framework. While paragraph 7 on Governance suspends the effectivity of all provisions
requiring changes to the legal framework, such clause is itself invalid, as will be discussed in the
following section.
Indeed, ours is an open society, with all the acts of the government subject to public scrutiny and
available always to public cognizance. This has to be so if the country is to remain democratic,
with sovereignty residing in the people and all government authority emanating from them.149

ON THE SECOND SUBSTANTIVE ISSUE

With regard to the provisions of the MOA-AD, there can be no question that they cannot all be
accommodated under the present Constitution and laws. Respondents have admitted as much in
the oral arguments before this Court, and the MOA-AD itself recognizes the need to amend the
existing legal framework to render effective at least some of its provisions. Respondents,
nonetheless, counter that the MOA-AD is free of any legal infirmity because any provisions
therein which are inconsistent with the present legal framework will not be effective until the
necessary changes to that framework are made. The validity of this argument will be considered
later. For now, the Court shall pass upon how

The MOA-AD is inconsistent with the Constitution and laws as presently worded.

In general, the objections against the MOA-AD center on the extent of the powers conceded
therein to the BJE. Petitioners assert that the powers granted to the BJE exceed those granted to
any local government under present laws, and even go beyond those of the present ARMM.
Before assessing some of the specific powers that would have been vested in the BJE, however,
it would be useful to turn first to a general idea that serves as a unifying link to the different
provisions of the MOA-AD, namely, the international law concept of association. Significantly,
the MOA-AD explicitly alludes to this concept, indicating that the Parties actually framed its
provisions with it in mind.

Association is referred to in paragraph 3 on TERRITORY, paragraph 11 on RESOURCES, and

paragraph 4 on GOVERNANCE. It is in the last mentioned provision, however, that the MOA-
AD most clearly uses it to describe the envisioned relationship between the BJE and the Central
Government.

4. The relationship between the Central Government and the Bangsamoro juridical entity
shall be associative characterized by shared authority and responsibilitywith a structure of
governance based on executive, legislative, judicial and administrative institutions with defined
powers and functions in the comprehensive compact. A period of transition shall be established
in a comprehensive peace compact specifying the relationship between the Central Government
and the BJE. (Emphasis and underscoring supplied) cralawlibrary

The nature of the "associative" relationship may have been intended to be defined more precisely
in the still to be forged Comprehensive Compact. Nonetheless, given that there is a concept of
"association" in international law, and the MOA-AD - by its inclusion of international law
instruments in its TOR- placed itself in an international legal context, that concept of association
may be brought to bear in understanding the use of the term "associative" in the MOA-AD.

Keitner and Reisman state that

[a]n association is formed when two states of unequal power voluntarily establish durable links.
In the basic model, one state, the associate, delegates certain responsibilities to the other, the
principal, while maintaining its international status as a state. Free associations represent a
middle ground between integration and independence. x x x150 (Emphasis and underscoring
supplied)cralawlibrary

For purposes of illustration, the Republic of the Marshall Islands and the Federated States of
Micronesia (FSM), formerly part of the U.S.-administered Trust Territory of the Pacific
Islands,151 are associated states of the U.S. pursuant to a Compact of Free Association. The
currency in these countries is the U.S. dollar, indicating their very close ties with the U.S., yet
they issue their own travel documents, which is a mark of their statehood. Their international
legal status as states was confirmed by the UN Security Council and by their admission to UN
membership.

According to their compacts of free association, the Marshall Islands and the FSM generally
have the capacity to conduct foreign affairs in their own name and right, such capacity extending
to matters such as the law of the sea, marine resources, trade, banking, postal, civil aviation, and
cultural relations. The U.S. government, when conducting its foreign affairs, is obligated to
consult with the governments of the Marshall Islands or the FSM on matters which it (U.S.
government) regards as relating to or affecting either government.

In the event of attacks or threats against the Marshall Islands or the FSM, the U.S. government
has the authority and obligation to defend them as if they were part of U.S. territory. The U.S.
government, moreover, has the option of establishing and using military areas and facilities
within these associated states and has the right to bar the military personnel of any third country
from having access to these territories for military purposes.

It bears noting that in U.S. constitutional and international practice, free association is
understood as an international association between sovereigns. The Compact of Free Association
is a treaty which is subordinate to the associated nation's national constitution, and each party
may terminate the association consistent with the right of independence. It has been said that,
with the admission of the U.S.-associated states to the UN in 1990, the UN recognized that the
American model of free association is actually based on an underlying status of independence.152

In international practice, the "associated state" arrangement has usually been used as a
transitional device of former colonies on their way to full independence. Examples of states that
have passed through the status of associated states as a transitional phase are Antigua, St. Kitts-
Nevis-Anguilla, Dominica, St. Lucia, St. Vincent and Grenada. All have since become
independent states.153

Back to the MOA-AD, it contains many provisions which are consistent with the international
legal concept of association, specifically the following: the BJE's capacity to enter into economic
and trade relations with foreign countries, the commitment of the Central Government to ensure
the BJE's participation in meetings and events in the ASEAN and the specialized UN agencies,
and the continuing responsibility of the Central Government over external defense. Moreover,
the BJE's right to participate in Philippine official missions bearing on negotiation of border
agreements, environmental protection, and sharing of revenues pertaining to the bodies of water
adjacent to or between the islands forming part of the ancestral domain, resembles the right of
the governments of FSM and the Marshall Islands to be consulted by the U.S. government on
any foreign affairs matter affecting them.

These provisions of the MOA indicate, among other things, that the Parties aimed to vest in the
BJE the status of an associated state or, at any rate, a status closely approximating it.

The concept of association is not recognized under the present Constitution

No province, city, or municipality, not even the ARMM, is recognized under our laws as having
an "associative" relationship with the national government. Indeed, the concept implies powers
that go beyond anything ever granted by the Constitution to any local or regional government. It
also implies the recognition of the associated entity as a state. The Constitution, however, does
not contemplate any state in this jurisdiction other than the Philippine State, much less does it
provide for a transitory status that aims to prepare any part of Philippine territory for
independence.

Even the mere concept animating many of the MOA-AD's provisions, therefore, already requires
for its validity the amendment of constitutional provisions, specifically the following provisions
of Article X:

SECTION 1. The territorial and political subdivisions of the Republic of the Philippines are the
provinces, cities, municipalities, and barangays. There shall be autonomous regions in
Muslim Mindanao and the Cordilleras as hereinafter provided.

SECTION 15. There shall be created autonomous regions in Muslim Mindanao and in the
Cordilleras consisting of provinces, cities, municipalities, and geographical areas sharing
common and distinctive historical and cultural heritage, economic and social structures, and
other relevant characteristics within the framework of this Constitution and the national
sovereignty as well as territorial integrity of the Republic of the Philippines.

The BJE is a far more powerful

entity than the autonomous region
recognized in the Constitution

It is not merely an expanded version of the ARMM, the status of its relationship with the national
government being fundamentally different from that of the ARMM. Indeed, BJE is a state in all
but name as it meets the criteria of a state laid down in the Montevideo Convention,154
namely, a permanent population, a defined territory, a government, and a capacity to enter into
relations with other states.

Even assuming arguendo that the MOA-AD would not necessarily sever any portion of
Philippine territory, the spirit animating it - which has betrayed itself by its use of the concept
of association - runs counter to the national sovereignty and territorial integrity of the
Republic.
The defining concept underlying the relationship between the national government and the
BJE being itself contrary to the present Constitution, it is not surprising that many of the
specific provisions of the MOA-AD on the formation and powers of the BJE are in conflict
with the Constitution and the laws.

Article X, Section 18 of the Constitution provides that "[t]he creation of the autonomous region
shall be effective when approved by a majority of the votes cast by the constituent units in a
plebiscite called for the purpose, provided that only provinces, cities, and geographic areas
voting favorably in such plebiscite shall be included in the autonomous region." (Emphasis
supplied)cralawlibrary

As reflected above, the BJE is more of a state than an autonomous region. But even assuming
that it is covered by the term "autonomous region" in the constitutional provision just quoted, the
MOA-AD would still be in conflict with it. Under paragraph 2(c) on TERRITORY in relation to
2(d) and 2(e), the present geographic area of the ARMM and, in addition, the municipalities of
Lanao del Norte which voted for inclusion in the ARMM during the 2001 plebiscite - Baloi,
Munai, Nunungan, Pantar, Tagoloan and Tangkal - are automatically part of the BJE without
need of another plebiscite, in contrast to the areas under Categories A and B mentioned earlier in
the overview. That the present components of the ARMM and the above-mentioned
municipalities voted for inclusion therein in 2001, however, does not render another plebiscite
unnecessary under the Constitution, precisely because what these areas voted for then was their
inclusion in the ARMM, not the BJE.

The MOA-AD, moreover, would not

comply with Article X, Section 20 of
the Constitution

since that provision defines the powers of autonomous regions as follows:

SECTION 20. Within its territorial jurisdiction and subject to the provisions of this Constitution
and national laws, the organic act of autonomous regions shall provide for legislative powers
over:

(1) Administrative organization;

(2) Creation of sources of revenues;

(3) Ancestral domain and natural resources;

(4) Personal, family, and property relations;

(5) Regional urban and rural planning development;

(6) Economic, social, and tourism development;

(7) Educational policies;

(8) Preservation and development of the cultural heritage; and cralawlibrary

(9) Such other matters as may be authorized by law for the promotion of the general welfare of
the people of the region. (Underscoring supplied) cralawlibrary

Again on the premise that the BJE may be regarded as an autonomous region, the MOA-AD
would require an amendment that would expand the above-quoted provision. The mere passage
of new legislation pursuant to sub-paragraph No. 9 of said constitutional provision would not
suffice, since any new law that might vest in the BJE the powers found in the MOA-AD must,
itself, comply with other provisions of the Constitution. It would not do, for instance, to merely
pass legislation vesting the BJE with treaty-making power in order to accommodate paragraph 4
of the strand on RESOURCES which states: "The BJE is free to enter into any economic
cooperation and trade relations with foreign countries: provided, however, that such relationships
and understandings do not include aggression against the Government of the Republic of the
Philippines x x x." Under our constitutional system, it is only the President who has that power.
Pimentel v. Executive Secretary155 instructs:

In our system of government, the President, being the head of state, is regarded as the sole organ
and authority in external relations and is the country's sole representative with foreign
nations. As the chief architect of foreign policy, the President acts as the country's mouthpiece
with respect to international affairs. Hence, the President is vested with the authority to deal
with foreign states and governments, extend or withhold recognition, maintain diplomatic
relations, enter into treaties, and otherwise transact the business of foreign relations. In the
realm of treaty-making, the President has the sole authority to negotiate with other states.
(Emphasis and underscoring supplied) cralawlibrary

Article II, Section 22 of the Constitution must also be amended if the scheme envisioned in
the MOA-AD is to be effected. That constitutional provision states: "The State recognizes and
promotes the rights of indigenous cultural communities within the framework of national unity
and development." (Underscoring supplied) An associative arrangement does not uphold
national unity. While there may be a semblance of unity because of the associative ties between
the BJE and the national government, the act of placing a portion of Philippine territory in a
status which, in international practice, has generally been a preparation for independence, is
certainly not conducive to national unity.

Besides being irreconcilable with the Constitution, the MOA-AD is also inconsistent with
prevailing statutory law, among which are R.A. No. 9054156 or the Organic Act of the
ARMM, and the IPRA.157

Article X, Section 3 of the Organic Act of the ARMM is a bar to the adoption of the
definition of "Bangsamoro people" used in the MOA-AD. Paragraph 1 on Concepts and
Principles states:

1. It is the birthright of all Moros and all Indigenous peoples of Mindanao to identify
themselves and be accepted as "Bangsamoros". The Bangsamoro people refers to those who
are natives or original inhabitants of Mindanao and its adjacent islands including Palawan
and the Sulu archipelago at the time of conquest or colonization of its descendants whether
mixed or of full blood. Spouses and their descendants are classified as Bangsamoro. The freedom
of choice of the Indigenous people shall be respected. (Emphasis and underscoring supplied) cralawlibrary

This use of the term Bangsamoro sharply contrasts with that found in the Article X, Section 3 of
the Organic Act, which, rather than lumping together the identities of the Bangsamoro and other
indigenous peoples living in Mindanao, clearly distinguishes between Bangsamoro people and
Tribal peoples, as follows:

"As used in this Organic Act, the phrase "indigenous cultural community" refers to Filipino
citizens residing in the autonomous region who are:

(a) Tribal peoples. These are citizens whose social, cultural and economic conditions distinguish
them from other sectors of the national community; and cralawlibrary

(b) Bangsa Moro people. These are citizens who are believers in Islam and who have retained
some or all of their own social, economic, cultural, and political institutions."

Respecting the IPRA, it lays down the prevailing procedure for the delineation and recognition
of ancestral domains. The MOA-AD's manner of delineating the ancestral domain of the
Bangsamoro people is a clear departure from that procedure. By paragraph 1 of Territory, the
Parties simply agree that, subject to the delimitations in the agreed Schedules, "[t]he Bangsamoro
homeland and historic territory refer to the land mass as well as the maritime, terrestrial, fluvial
and alluvial domains, and the aerial domain, the atmospheric space above it, embracing the
Mindanao-Sulu-Palawan geographic region."

Chapter VIII of the IPRA, on the other hand, lays down a detailed procedure, as illustrated in the
following provisions thereof:

SECTION 52. Delineation Process. - The identification and delineation of ancestral domains
shall be done in accordance with the following procedures:

xxx

b) Petition for Delineation. - The process of delineating a specific perimeter may be initiated by
the NCIP with the consent of the ICC/IP concerned, or through a Petition for Delineation filed
with the NCIP, by a majority of the members of the ICCs/IPs;

c) Delineation Proper. - The official delineation of ancestral domain boundaries including census
of all community members therein, shall be immediately undertaken by the Ancestral Domains
Office upon filing of the application by the ICCs/IPs concerned. Delineation will be done in
coordination with the community concerned and shall at all times include genuine involvement
and participation by the members of the communities concerned;

d) Proof Required. - Proof of Ancestral Domain Claims shall include the testimony of elders or
community under oath, and other documents directly or indirectly attesting to the possession or
occupation of the area since time immemorial by such ICCs/IPs in the concept of owners which
shall be any one (1) of the following authentic documents:

1) Written accounts of the ICCs/IPs customs and traditions;

2) Written accounts of the ICCs/IPs political structure and institution;

3) Pictures showing long term occupation such as those of old improvements, burial grounds,
sacred places and old villages;

4) Historical accounts, including pacts and agreements concerning boundaries entered into by the
ICCs/IPs concerned with other ICCs/IPs;

5) Survey plans and sketch maps;

6) Anthropological data;

7) Genealogical surveys;

8) Pictures and descriptive histories of traditional communal forests and hunting grounds;

9) Pictures and descriptive histories of traditional landmarks such as mountains, rivers, creeks,
ridges, hills, terraces and the like; and
cralawlibrary

10) Write-ups of names and places derived from the native dialect of the community.

e) Preparation of Maps. - On the basis of such investigation and the findings of fact based
thereon, the Ancestral Domains Office of the NCIP shall prepare a perimeter map, complete with
technical descriptions, and a description of the natural features and landmarks embraced therein;

f) Report of Investigation and Other Documents. - A complete copy of the preliminary census
and a report of investigation, shall be prepared by the Ancestral Domains Office of the NCIP;

g) Notice and Publication. - A copy of each document, including a translation in the native
language of the ICCs/IPs concerned shall be posted in a prominent place therein for at least
fifteen (15) days. A copy of the document shall also be posted at the local, provincial and
regional offices of the NCIP, and shall be published in a newspaper of general circulation once a
week for two (2) consecutive weeks to allow other claimants to file opposition thereto within
fifteen (15) days from date of such publication: Provided, That in areas where no such newspaper
exists, broasting in a radio station will be a valid substitute: Provided, further, That mere posting
shall be deemed sufficient if both newspaper and radio station are not available;

h) Endorsement to NCIP. - Within fifteen (15) days from publication, and of the inspection
process, the Ancestral Domains Office shall prepare a report to the NCIP endorsing a favorable
action upon a claim that is deemed to have sufficient proof. However, if the proof is deemed
insufficient, the Ancestral Domains Office shall require the submission of additional evidence:
Provided, That the Ancestral Domains Office shall reject any claim that is deemed patently false
or fraudulent after inspection and verification: Provided, further, That in case of rejection, the
Ancestral Domains Office shall give the applicant due notice, copy furnished all concerned,
containing the grounds for denial. The denial shall be appealable to the NCIP: Provided,
furthermore, That in cases where there are conflicting claims among ICCs/IPs on the boundaries
of ancestral domain claims, the Ancestral Domains Office shall cause the contending parties to
meet and assist them in coming up with a preliminary resolution of the conflict, without
prejudice to its full adjudication according to the section below.

xxx

To remove all doubts about the irreconcilability of the MOA-AD with the present legal system, a
discussion of not only the Constitution and domestic statutes, but also of international law is in
order, for

Article II, Section 2 of the Constitution states that the Philippines "adopts the generally
accepted principles of international law as part of the law of the land."

Applying this provision of the Constitution, the Court, in Mejoff v. Director of Prisons,158 held
that the Universal Declaration of Human Rights is part of the law of the land on account of
which it ordered the release on bail of a detained alien of Russian descent whose deportation
order had not been executed even after two years. Similarly, the Court in Agustin v. Edu159
applied the aforesaid constitutional provision to the 1968 Vienna Convention on Road Signs and
Signals.

International law has long recognized the right to self-determination of "peoples," understood not
merely as the entire population of a State but also a portion thereof. In considering the question
of whether the people of Quebec had a right to unilaterally secede from Canada, the Canadian
Supreme Court in REFERENCE RE SECESSION OF QUEBEC160 had occasion to acknowledge
that "the right of a people to self-determination is now so widely recognized in international
conventions that the principle has acquired a status beyond 'convention' and is considered a
general principle of international law."

Among the conventions referred to are the International Covenant on Civil and Political Rights161
and the International Covenant on Economic, Social and Cultural Rights162 which state, in Article
1 of both covenants, that all peoples, by virtue of the right of self-determination, "freely
determine their political status and freely pursue their economic, social, and cultural
development."

The people's right to self-determination should not, however, be understood as extending to a

unilateral right of secession. A distinction should be made between the right of internal and
external self-determination. REFERENCE RE SECESSION OF QUEBEC is again instructive:

"(ii) Scope of the Right to Self-determination

126. The recognized sources of international law establish that the right to self-determination
of a people is normally fulfilled through internal self-determination - a people's pursuit of
its political, economic, social and cultural development within the framework of an existing
state. A right to external self-determination (which in this case potentially takes the form of
the assertion of a right to unilateral secession) arises in only the most extreme of cases and,
even then, under carefully defined circumstances. x x x

External self-determination can be defined as in the following statement from the

Declaration on Friendly Relations, supra, as

The establishment of a sovereign and independent State, the free association or integration with
an independent State or the emergence into any other political status freely determined by a
people constitute modes of implementing the right of self-determination by that people.
(Emphasis added)

127. The international law principle of self-determination has evolved within a framework
of respect for the territorial integrity of existing states. The various international documents
that support the existence of a people's right to self-determination also contain parallel statements
supportive of the conclusion that the exercise of such a right must be sufficiently limited to
prevent threats to an existing state's territorial integrity or the stability of relations between
sovereign states.

x x x x (Emphasis, italics and underscoring supplied)

The Canadian Court went on to discuss the exceptional cases in which the right to external self-
determination can arise, namely, where a people is under colonial rule, is subject to foreign
domination or exploitation outside a colonial context, and - less definitely but asserted by a
number of commentators - is blocked from the meaningful exercise of its right to internal self-
determination. The Court ultimately held that the population of Quebec had no right to secession,
as the same is not under colonial rule or foreign domination, nor is it being deprived of the
freedom to make political choices and pursue economic, social and cultural development, citing
that Quebec is equitably represented in legislative, executive and judicial institutions within
Canada, even occupying prominent positions therein.

The exceptional nature of the right of secession is further exemplified in the REPORT OF THE
INTERNATIONAL COMMITTEE OF JURISTS ON THE LEGAL ASPECTS OF THE
AALAND ISLANDS QUESTION.163 There, Sweden presented to the Council of the League of
Nations the question of whether the inhabitants of the Aaland Islands should be authorized to
determine by plebiscite if the archipelago should remain under Finnish sovereignty or be
incorporated in the kingdom of Sweden. The Council, before resolving the question, appointed
an International Committee composed of three jurists to submit an opinion on the preliminary
issue of whether the dispute should, based on international law, be entirely left to the domestic
jurisdiction of Finland. The Committee stated the rule as follows:

x x x [I]n the absence of express provisions in international treaties, the right of disposing of
national territory is essentially an attribute of the sovereignty of every State. Positive
International Law does not recognize the right of national groups, as such, to separate
themselves from the State of which they form part by the simple expression of a wish, any
more than it recognizes the right of other States to claim such a separation. Generally speaking,
the grant or refusal of the right to a portion of its population of determining its own
political fate by plebiscite or by some other method, is, exclusively, an attribute of the
sovereignty of every State which is definitively constituted. A dispute between two States
concerning such a question, under normal conditions therefore, bears upon a question which
International Law leaves entirely to the domestic jurisdiction of one of the States concerned. Any
other solution would amount to an infringement of sovereign rights of a State and would involve
the risk of creating difficulties and a lack of stability which would not only be contrary to the
very idea embodied in term "State," but would also endanger the interests of the international
community. If this right is not possessed by a large or small section of a nation, neither can it be
held by the State to which the national group wishes to be attached, nor by any other State.
(Emphasis and underscoring supplied) cralawlibrary

The Committee held that the dispute concerning the Aaland Islands did not refer to a question
which is left by international law to the domestic jurisdiction of Finland, thereby applying the
exception rather than the rule elucidated above. Its ground for departing from the general rule,
however, was a very narrow one, namely, the Aaland Islands agitation originated at a time when
Finland was undergoing drastic political transformation. The internal situation of Finland was,
according to the Committee, so abnormal that, for a considerable time, the conditions required
for the formation of a sovereign State did not exist. In the midst of revolution, anarchy, and civil
war, the legitimacy of the Finnish national government was disputed by a large section of the
people, and it had, in fact, been chased from the capital and forcibly prevented from carrying out
its duties. The armed camps and the police were divided into two opposing forces. In light of
these circumstances, Finland was not, during the relevant time period, a "definitively constituted"
sovereign state. The Committee, therefore, found that Finland did not possess the right to
withhold from a portion of its population the option to separate itself - a right which sovereign
nations generally have with respect to their own populations.

Turning now to the more specific category of indigenous peoples, this term has been used, in
scholarship as well as international, regional, and state practices, to refer to groups with distinct
cultures, histories, and connections to land (spiritual and otherwise) that have been forcibly
incorporated into a larger governing society. These groups are regarded as "indigenous" since
they are the living descendants of pre-invasion inhabitants of lands now dominated by others.
Otherwise stated, indigenous peoples, nations, or communities are culturally distinctive groups
that find themselves engulfed by settler societies born of the forces of empire and conquest.164
Examples of groups who have been regarded as indigenous peoples are the Maori of New
Zealand and the aboriginal peoples of Canada.

As with the broader category of "peoples," indigenous peoples situated within states do not have
a general right to independence or secession from those states under international law,165 but they
do have rights amounting to what was discussed above as the right to internal self-
determination.
In a historic development last September 13, 2007, the UN General Assembly adopted the
United Nations Declaration on the Rights of Indigenous Peoples (UN DRIP) throughGeneral
Assembly Resolution 61/295. The vote was 143 to 4, the Philippines being included among
those in favor, and the four voting against being Australia, Canada, New Zealand, and the U.S.
The Declaration clearly recognized the right of indigenous peoples to self-determination,
encompassing the right to autonomy or self-government, to wit:

Article 3

Indigenous peoples have the right to self-determination. By virtue of that right they freely
determine their political status and freely pursue their economic, social and cultural
development.

Article 4

Indigenous peoples, in exercising their right to self-determination, have the right to autonomy
or self-government in matters relating to their internal and local affairs, as well as ways and
means for financing their autonomous functions.

Article 5

Indigenous peoples have the right to maintain and strengthen their distinct political, legal,
economic, social and cultural institutions, while retaining their right to participate fully, if they
so choose, in the political, economic, social and cultural life of the State.

Self-government, as used in international legal discourse pertaining to indigenous peoples, has

been understood as equivalent to "internal self-determination."166 The extent of self-
determination provided for in the UN DRIP is more particularly defined in its subsequent
articles, some of which are quoted hereunder:

Article 8

1. Indigenous peoples and individuals have the right not to be subjected to forced assimilation or
destruction of their culture.

2. States shall provide effective mechanisms for prevention of, and redress for:

(a) Any action which has the aim or effect of depriving them of their integrity as distinct
peoples, or of their cultural values or ethnic identities;

(b) Any action which has the aim or effect of dispossessing them of their lands, territories
or resources;

(c) Any form of forced population transfer which has the aim or effect of violating or
undermining any of their rights;
(d) Any form of forced assimilation or integration;

(e) Any form of propaganda designed to promote or incite racial or ethnic discrimination
directed against them.

Article 21

1. Indigenous peoples have the right, without discrimination, to the improvement of their
economic and social conditions, including, inter alia, in the areas of education, employment,
vocational training and retraining, housing, sanitation, health and social security.

2. States shall take effective measures and, where appropriate, special measures to ensure
continuing improvement of their economic and social conditions. Particular attention shall be
paid to the rights and special needs of indigenous elders, women, youth, children and persons
with disabilities.

Article 26

1. Indigenous peoples have the right to the lands, territories and resources which they have
traditionally owned, occupied or otherwise used or acquired.

2. Indigenous peoples have the right to own, use, develop and control the lands, territories and
resources that they possess by reason of traditional ownership or other traditional occupation or
use, as well as those which they have otherwise acquired.

3. States shall give legal recognition and protection to these lands, territories and resources. Such
recognition shall be conducted with due respect to the customs, traditions and land tenure
systems of the indigenous peoples concerned.

Article 30

1. Military activities shall not take place in the lands or territories of indigenous peoples, unless
justified by a relevant public interest or otherwise freely agreed with or requested by the
indigenous peoples concerned.

2. States shall undertake effective consultations with the indigenous peoples concerned, through
appropriate procedures and in particular through their representative institutions, prior to using
their lands or territories for military activities.

Article 32

1. Indigenous peoples have the right to determine and develop priorities and strategies for the
development or use of their lands or territories and other resources.

2. States shall consult and cooperate in good faith with the indigenous peoples concerned
through their own representative institutions in order to obtain their free and informed consent
prior to the approval of any project affecting their lands or territories and other resources,
particularly in connection with the development, utilization or exploitation of mineral, water or
other resources.

3. States shall provide effective mechanisms for just and fair redress for any such activities, and
appropriate measures shall be taken to mitigate adverse environmental, economic, social, cultural
or spiritual impact.

Article 37

1. Indigenous peoples have the right to the recognition, observance and enforcement of treaties,
agreements and other constructive arrangements concluded with States or their successors and to
have States honour and respect such treaties, agreements and other constructive arrangements.

2. Nothing in this Declaration may be interpreted as diminishing or eliminating the rights of

indigenous peoples contained in treaties, agreements and other constructive arrangements.

Article 38

States in consultation and cooperation with indigenous peoples, shall take the appropriate
measures, including legislative measures, to achieve the ends of this Declaration.

Assuming that the UN DRIP, like the Universal Declaration on Human Rights, must now be
regarded as embodying customary international law - a question which the Court need not
definitively resolve here - the obligations enumerated therein do not strictly require the Republic
to grant the Bangsamoro people, through the instrumentality of the BJE, the particular rights and
powers provided for in the MOA-AD. Even the more specific provisions of the UN DRIP are
general in scope, allowing for flexibility in its application by the different States.

There is, for instance, no requirement in the UN DRIP that States now guarantee indigenous
peoples their own police and internal security force. Indeed, Article 8 presupposes that it is the
State which will provide protection for indigenous peoples against acts like the forced
dispossession of their lands - a function that is normally performed by police officers. If the
protection of a right so essential to indigenous people's identity is acknowledged to be the
responsibility of the State, then surely the protection of rights less significant to them as such
peoples would also be the duty of States. Nor is there in the UN DRIP an acknowledgement of
the right of indigenous peoples to the aerial domain and atmospheric space. What it upholds, in
Article 26 thereof, is the right of indigenous peoples to the lands, territories and resources which
they have traditionally owned, occupied or otherwise used or acquired.

Moreover, the UN DRIP, while upholding the right of indigenous peoples to autonomy, does not
obligate States to grant indigenous peoples the near-independent status of an associated state. All
the rights recognized in that document are qualified in Article 46 as follows:

1. Nothing in this Declaration may be interpreted as implying for any State, people, group or
person any right to engage in any activity or to perform any act contrary to the Charter of the
United Nations or construed as authorizing or encouraging any action which would
dismember or impair, totally or in part, the territorial integrity or political unity of
sovereign and independent States.

Even if the UN DRIP were considered as part of the law of the land pursuant to Article II,
Section 2 of the Constitution, it would not suffice to uphold the validity of the MOA-AD so as to
render its compliance with other laws unnecessary.

It is, therefore, clear that the MOA-AD contains numerous provisions that cannot be
reconciled with the Constitution and the laws as presently worded. Respondents proffer,
however, that the signing of the MOA-AD alone would not have entailed any violation of law or
grave abuse of discretion on their part, precisely because it stipulates that the provisions thereof
inconsistent with the laws shall not take effect until these laws are amended. They cite paragraph
7 of the MOA-AD strand on GOVERNANCE quoted earlier, but which is reproduced below for
convenience:

7. The Parties agree that the mechanisms and modalities for the actual implementation of this
MOA-AD shall be spelt out in the Comprehensive Compact to mutually take such steps to enable
it to occur effectively.

Any provisions of the MOA-AD requiring amendments to the existing legal framework shall
come into force upon signing of a Comprehensive Compact and upon effecting the necessary
changes to the legal framework with due regard to non derogation of prior agreements and within
the stipulated timeframe to be contained in the Comprehensive Compact.

Indeed, the foregoing stipulation keeps many controversial provisions of the MOA-AD from
coming into force until the necessary changes to the legal framework are effected. While the
word "Constitution" is not mentioned in the provision now under consideration or
anywhere else in the MOA-AD, the term "legal framework" is certainly broad enough to
include the Constitution.

Notwithstanding the suspensive clause, however, respondents, by their mere act of incorporating
in the MOA-AD the provisions thereof regarding the associative relationship between the BJE
and the Central Government, have already violated the Memorandum of Instructions From The
President dated March 1, 2001, which states that the "negotiations shall be conducted in
accordance with x x x the principles of the sovereignty and territorial integrity of the Republic
of the Philippines." (Emphasis supplied) Establishing an associative relationship between the
BJE and the Central Government is, for the reasons already discussed, a preparation for
independence, or worse, an implicit acknowledgment of an independent status already
prevailing.

Even apart from the above-mentioned Memorandum, however, the MOA-AD is defective
because the suspensive clause is invalid, as discussed below.

The authority of the GRP Peace Negotiating Panel to negotiate with the MILF is founded on
E.O. No. 3, Section 5(c), which states that there shall be established Government Peace
Negotiating Panels for negotiations with different rebel groups to be "appointed by the President
as her official emissaries to conduct negotiations, dialogues, and face-to-face discussions with
rebel groups." These negotiating panels are to report to the President, through the PAPP on the
conduct and progress of the negotiations.

It bears noting that the GRP Peace Panel, in exploring lasting solutions to the Moro Problem
through its negotiations with the MILF, was not restricted by E.O. No. 3 only to those options
available under the laws as they presently stand. One of the components of a comprehensive
peace process, which E.O. No. 3 collectively refers to as the "Paths to Peace," is the pursuit of
social, economic, and political reforms which may require new legislation or even constitutional
amendments. Sec. 4(a) of E.O. No. 3, which reiterates Section 3(a), of E.O. No. 125,167 states:

SECTION 4. The Six Paths to Peace. - The components of the comprehensive peace process
comprise the processes known as the "Paths to Peace". These component processes are
interrelated and not mutually exclusive, and must therefore be pursued simultaneously in a
coordinated and integrated fashion. They shall include, but may not be limited to, the following:

A. PURSUIT OF SOCIAL, ECONOMIC AND POLITICAL REFORMS. This component

involves the vigorous implementation of various policies, reforms, programs and projects
aimed at addressing the root causes of internal armed conflicts and social unrest. This may
require administrative action, new legislation or even constitutional amendments.

x x x x (Emphasis supplied) cralawlibrary

The MOA-AD, therefore, may reasonably be perceived as an attempt of respondents to address,

pursuant to this provision of E.O. No. 3, the root causes of the armed conflict in Mindanao. The
E.O. authorized them to "think outside the box," so to speak. Hence, they negotiated and were set
on signing the MOA-AD that included various social, economic, and political reforms which
cannot, however, all be accommodated within the present legal framework, and which thus
would require new legislation and constitutional amendments.

The inquiry on the legality of the "suspensive clause," however, cannot stop here, because it
must be asked whether the President herself may exercise the power delegated to the GRP
Peace Panel under E.O. No. 3, Sec. 4(a).

The President cannot delegate a power that she herself does not possess. May the President, in
the course of peace negotiations, agree to pursue reforms that would require new legislation and
constitutional amendments, or should the reforms be restricted only to those solutions which the
present laws allow? The answer to this question requires a discussion of the extent of the
President's power to conduct peace negotiations.

That the authority of the President to conduct peace negotiations with rebel groups is not
explicitly mentioned in the Constitution does not mean that she has no such authority. In
Sanlakas v. Executive Secretary,168 in issue was the authority of the President to declare a state of
rebellion - an authority which is not expressly provided for in the Constitution. The Court held
thus:
"In her ponencia in Marcos v. Manglapus, Justice Cortes put her thesis into jurisprudence. There,
the Court, by a slim 8-7 margin, upheld the President's power to forbid the return of her exiled
predecessor. The rationale for the majority's ruling rested on the President's

. . . unstated residual powers which are implied from the grant of executive power and
which are necessary for her to comply with her duties under the Constitution. The powers
of the President are not limited to what are expressly enumerated in the article on the
Executive Department and in scattered provisions of the Constitution. This is so,
notwithstanding the avowed intent of the members of the Constitutional Commission of 1986 to
limit the powers of the President as a reaction to the abuses under the regime of Mr. Marcos, for
the result was a limitation of specific powers of the President, particularly those relating to the
commander-in-chief clause, but not a diminution of the general grant of executive power.

Thus, the President's authority to declare a state of rebellion springs in the main from her
powers as chief executive and, at the same time, draws strength from her Commander-in-
Chief powers. x x x (Emphasis and underscoring supplied) cralawlibrary

Similarly, the President's power to conduct peace negotiations is implicitly included in her
powers as Chief Executive and Commander-in-Chief. As Chief Executive, the President has the
general responsibility to promote public peace, and as Commander-in-Chief, she has the more
specific duty to prevent and suppress rebellion and lawless violence.169

As the experience of nations which have similarly gone through internal armed conflict will
show, however, peace is rarely attained by simply pursuing a military solution. Oftentimes,
changes as far-reaching as a fundamental reconfiguration of the nation's constitutional structure
is required. The observations of Dr. Kirsti Samuels are enlightening, to wit:

x x x [T]he fact remains that a successful political and governance transition must form the core
of any post-conflict peace-building mission. As we have observed in Liberia and Haiti over the
last ten years, conflict cessation without modification of the political environment, even where
state-building is undertaken through technical electoral assistance and institution - or capacity-
building, is unlikely to succeed. On average, more than 50 percent of states emerging from
conflict return to conflict. Moreover, a substantial proportion of transitions have resulted in weak
or limited democracies.

The design of a constitution and its constitution-making process can play an important role in the
political and governance transition. Constitution-making after conflict is an opportunity to create
a common vision of the future of a state and a road map on how to get there. The constitution can
be partly a peace agreement and partly a framework setting up the rules by which the new
democracy will operate.170

In the same vein, Professor Christine Bell, in her article on the nature and legal status of peace
agreements, observed that the typical way that peace agreements establish or confirm
mechanisms for demilitarization and demobilization is by linking them to new constitutional
structures addressing governance, elections, and legal and human rights institutions.171
In the Philippine experience, the link between peace agreements and constitution-making has
been recognized by no less than the framers of the Constitution. Behind the provisions of the
Constitution on autonomous regions172 is the framers' intention to implement a particular peace
agreement, namely, the Tripoli Agreement of 1976 between the GRP and the MNLF, signed by
then Undersecretary of National Defense Carmelo Z. Barbero and then MNLF Chairman Nur
Misuari.

MR. ROMULO. There are other speakers; so, although I have some more questions, I will
reserve my right to ask them if they are not covered by the other speakers. I have only two
questions.

I heard one of the Commissioners say that local autonomy already exists in the Muslim
region; it is working very well; it has, in fact, diminished a great deal of the problems. So, my
question is: since that already exists, why do we have to go into something new?

MR. OPLE. May I answer that on behalf of Chairman Nolledo. Commissioner Yusup Abubakar
is right that certain definite steps have been taken to implement the provisions of the Tripoli
Agreement with respect to an autonomous region in Mindanao. This is a good first step,
but there is no question that this is merely a partial response to the Tripoli Agreement itself
and to the fuller standard of regional autonomy contemplated in that agreement, and now
by state policy.173 (Emphasis supplied) cralawlibrary

The constitutional provisions on autonomy and the statutes enacted pursuant to them have, to the
credit of their drafters, been partly successful. Nonetheless, the Filipino people are still faced
with the reality of an on-going conflict between the Government and the MILF. If the President
is to be expected to find means for bringing this conflict to an end and to achieve lasting peace in
Mindanao, then she must be given the leeway to explore, in the course of peace negotiations,
solutions that may require changes to the Constitution for their implementation. Being uniquely
vested with the power to conduct peace negotiations with rebel groups, the President is in a
singular position to know the precise nature of their grievances which, if resolved, may bring an
end to hostilities.

The President may not, of course, unilaterally implement the solutions that she considers viable,
but she may not be prevented from submitting them as recommendations to Congress, which
could then, if it is minded, act upon them pursuant to the legal procedures for constitutional
amendment and revision. In particular, Congress would have the option, pursuant to Article
XVII, Sections 1 and 3 of the Constitution, to propose the recommended amendments or revision
to the people, call a constitutional convention, or submit to the electorate the question of calling
such a convention.

While the President does not possess constituent powers - as those powers may be exercised only
by Congress, a Constitutional Convention, or the people through initiative and referendum - she
may submit proposals for constitutional change to Congress in a manner that does not involve
the arrogation of constituent powers.
In Sanidad v. COMELEC,174 in issue was the legality of then President Marcos' act of directly
submitting proposals for constitutional amendments to a referendum, bypassing the interim
National Assembly which was the body vested by the 1973 Constitution with the power to
propose such amendments. President Marcos, it will be recalled, never convened the interim
National Assembly. The majority upheld the President's act, holding that "the urges of absolute
necessity" compelled the President as the agent of the people to act as he did, there being no
interim National Assembly to propose constitutional amendments. Against this ruling, Justices
Teehankee and Muñoz Palma vigorously dissented. The Court's concern at present, however, is
not with regard to the point on which it was then divided in that controversial case, but on that
which was not disputed by either side.

Justice Teehankee's dissent,175 in particular, bears noting. While he disagreed that the President
may directly submit proposed constitutional amendments to a referendum, implicit in his opinion
is a recognition that he would have upheld the President's action along with the majority had the
President convened the interim National Assembly and coursed his proposals through it. Thus
Justice Teehankee opined:

"Since the Constitution provides for the organization of the essential departments of government,
defines and delimits the powers of each and prescribes the manner of the exercise of such
powers, and the constituent power has not been granted to but has been withheld from the
President or Prime Minister, it follows that the President's questioned decrees proposing and
submitting constitutional amendments directly to the people (without the intervention of the
interim National Assembly in whom the power is expressly vested) are devoid of
constitutional and legal basis."176 (Emphasis supplied)
cralawlibrary

From the foregoing discussion, the principle may be inferred that the President - in the course of
conducting peace negotiations - may validly consider implementing even those policies that
require changes to the Constitution, but she may not unilaterally implement them without the
intervention of Congress, or act in any way as if the assent of that body were assumed as a
certainty.

Since, under the present Constitution, the people also have the power to directly propose
amendments through initiative and referendum, the President may also submit her
recommendations to the people, not as a formal proposal to be voted on in a plebiscite similar to
what President Marcos did in Sanidad, but for their independent consideration of whether these
recommendations merit being formally proposed through initiative.

These recommendations, however, may amount to nothing more than the President's suggestions
to the people, for any further involvement in the process of initiative by the Chief Executive may
vitiate its character as a genuine "people's initiative." The only initiative recognized by the
Constitution is that which truly proceeds from the people. As the Court stated in Lambino v.
COMELEC:177

"The Lambino Group claims that their initiative is the 'people's voice.' However, the Lambino
Group unabashedly states in ULAP Resolution No. 2006-02, in the verification of their petition
with the COMELEC, that 'ULAP maintains its unqualified support to the agenda of Her
Excellency President Gloria Macapagal-Arroyo for constitutional reforms.' The Lambino Group
thus admits that their 'people's' initiative is an 'unqualified support to the agenda' of the
incumbent President to change the Constitution. This forewarns the Court to be wary of
incantations of 'people's voice' or 'sovereign will' in the present initiative."

It will be observed that the President has authority, as stated in her oath of office,178 only to
preserve and defend the Constitution. Such presidential power does not, however, extend to
allowing her to change the Constitution, but simply to recommend proposed amendments or
revision. As long as she limits herself to recommending these changes and submits to the proper
procedure for constitutional amendments and revision, her mere recommendation need not be
construed as an unconstitutional act.

The foregoing discussion focused on the President's authority to propose constitutional

amendments, since her authority to propose new legislation is not in controversy. It has been an
accepted practice for Presidents in this jurisdiction to propose new legislation. One of the more
prominent instances the practice is usually done is in the yearly State of the Nation Address of
the President to Congress. Moreover, the annual general appropriations bill has always been
based on the budget prepared by the President, which - for all intents and purposes - is a proposal
for new legislation coming from the President.179

The "suspensive clause" in the MOA-AD viewed in light of the above-discussed standards

Given the limited nature of the President's authority to propose constitutional amendments, she
cannot guarantee to any third party that the required amendments will eventually be put in
place, nor even be submitted to a plebiscite. The most she could do is submit these proposals as
recommendations either to Congress or the people, in whom constituent powers are vested.

Paragraph 7 on Governance of the MOA-AD states, however, that all provisions thereof which
cannot be reconciled with the present Constitution and laws "shall come into force upon signing
of a Comprehensive Compact and upon effecting the necessary changes to the legal framework."
This stipulation does not bear the marks of a suspensive condition - defined in civil law as a
future and uncertain event - but of a term. It is not a question of whether the necessary changes
to the legal framework will be effected, but when. That there is no uncertainty being
contemplated is plain from what follows, for the paragraph goes on to state that the contemplated
changes shall be "with due regard to non derogation of prior agreements and within the stipulated
timeframe to be contained in the Comprehensive Compact."

Pursuant to this stipulation, therefore, it is mandatory for the GRP to effect the changes to the
legal framework contemplated in the MOA-AD - which changes would include constitutional
amendments, as discussed earlier. It bears noting that,

By the time these changes are put in place, the MOA-AD itself would be counted among the
"prior agreements" from which there could be no derogation.
What remains for discussion in the Comprehensive Compact would merely be the implementing
details for these "consensus points" and, notably, the deadline for effecting the contemplated
changes to the legal framework.

Plainly, stipulation-paragraph 7 on GOVERNANCE is inconsistent with the limits of the

President's authority to propose constitutional amendments, it being a virtual guarantee that
the Constitution and the laws of the Republic of the Philippines will certainly be adjusted to
conform to all the "consensus points" found in the MOA-AD. Hence, it must be struck down as
unconstitutional.

A comparison between the "suspensive clause" of the MOA-AD with a similar provision
appearing in the 1996 final peace agreement between the MNLF and the GRP is most instructive.

As a backdrop, the parties to the 1996 Agreement stipulated that it would be implemented in two
phases. Phase I covered a three-year transitional period involving the putting up of new
administrative structures through Executive Order, such as the Special Zone of Peace and
Development (SZOPAD) and the Southern Philippines Council for Peace and Development
(SPCPD), while Phase II covered the establishment of the new regional autonomous
government through amendment or repeal of R.A. No. 6734, which was then the Organic Act of
the ARMM.

The stipulations on Phase II consisted of specific agreements on the structure of the expanded
autonomous region envisioned by the parties. To that extent, they are similar to the provisions of
the MOA-AD. There is, however, a crucial difference between the two agreements. While the
MOA-AD virtually guarantees that the "necessary changes to the legal framework" will be
put in place, the GRP-MNLF final peace agreement states thus: "Accordingly, these provisions
[on Phase II] shall be recommended by the GRP to Congress for incorporation in the
amendatory or repealing law."

Concerns have been raised that the MOA-AD would have given rise to a binding international
law obligation on the part of the Philippines to change its Constitution in conformity thereto, on
the ground that it may be considered either as a binding agreement under international law, or a
unilateral declaration of the Philippine government to the international community that it would
grant to the Bangsamoro people all the concessions therein stated. Neither ground finds sufficient
support in international law, however.

The MOA-AD, as earlier mentioned in the overview thereof, would have included foreign
dignitaries as signatories. In addition, representatives of other nations were invited to witness its
signing in Kuala Lumpur. These circumstances readily lead one to surmise that the MOA-AD
would have had the status of a binding international agreement had it been signed. An
examination of the prevailing principles in international law, however, leads to the contrary
conclusion.

The Decision on Challenge to Jurisdiction: Lomé Accord Amnesty180 (the Lomé Accord case) of
the Special Court of Sierra Leone is enlightening. The Lomé Accord was a peace agreement
signed on July 7, 1999 between the Government of Sierra Leone and the Revolutionary United
Front (RUF), a rebel group with which the Sierra Leone Government had been in armed conflict
for around eight years at the time of signing. There were non-contracting signatories to the
agreement, among which were the Government of the Togolese Republic, the Economic
Community of West African States, and the UN.

On January 16, 2002, after a successful negotiation between the UN Secretary-General and the
Sierra Leone Government, another agreement was entered into by the UN and that Government
whereby the Special Court of Sierra Leone was established. The sole purpose of the Special
Court, an international court, was to try persons who bore the greatest responsibility for serious
violations of international humanitarian law and Sierra Leonean law committed in the territory of
Sierra Leone since November 30, 1996.

Among the stipulations of the Lomé Accord was a provision for the full pardon of the members
of the RUF with respect to anything done by them in pursuit of their objectives as members of
that organization since the conflict began.

In the Lomé Accord case, the Defence argued that the Accord created an internationally
binding obligation not to prosecute the beneficiaries of the amnesty provided therein, citing,
among other things, the participation of foreign dignitaries and international organizations in the
finalization of that agreement. The Special Court, however, rejected this argument, ruling that
the Lome Accord is not a treaty and that it can only create binding obligations and rights
between the parties in municipal law, not in international law. Hence, the Special Court held, it is
ineffective in depriving an international court like it of jurisdiction.

"37. In regard to the nature of a negotiated settlement of an internal armed conflict it is easy to
assume and to argue with some degree of plausibility, as Defence counsel for the defendants
seem to have done, that the mere fact that in addition to the parties to the conflict, the
document formalizing the settlement is signed by foreign heads of state or their
representatives and representatives of international organizations, means the agreement of
the parties is internationalized so as to create obligations in international law.

xxx

40. Almost every conflict resolution will involve the parties to the conflict and the mediator or
facilitator of the settlement, or persons or bodies under whose auspices the settlement took place
but who are not at all parties to the conflict, are not contracting parties and who do not claim any
obligation from the contracting parties or incur any obligation from the settlement.

41. In this case, the parties to the conflict are the lawful authority of the State and the RUF
which has no status of statehood and is to all intents and purposes a faction within the
state. The non-contracting signatories of the Lomé Agreement were moral guarantors of
the principle that, in the terms of Article XXXIV of the Agreement, "this peace agreement
is implemented with integrity and in good faith by both parties". The moral guarantors
assumed no legal obligation. It is recalled that the UN by its representative appended,
presumably for avoidance of doubt, an understanding of the extent of the agreement to be
implemented as not including certain international crimes.
42. An international agreement in the nature of a treaty must create rights and obligations
regulated by international law so that a breach of its terms will be a breach determined under
international law which will also provide principle means of enforcement. The Lomé
Agreement created neither rights nor obligations capable of being regulated by
international law. An agreement such as the Lomé Agreement which brings to an end an
internal armed conflict no doubt creates a factual situation of restoration of peace that the
international community acting through the Security Council may take note of. That,
however, will not convert it to an international agreement which creates an obligation
enforceable in international, as distinguished from municipal, law. A breach of the terms of
such a peace agreement resulting in resumption of internal armed conflict or creating a threat to
peace in the determination of the Security Council may indicate a reversal of the factual situation
of peace to be visited with possible legal consequences arising from the new situation of conflict
created. Such consequences such as action by the Security Council pursuant to Chapter VII arise
from the situation and not from the agreement, nor from the obligation imposed by it. Such
action cannot be regarded as a remedy for the breach. A peace agreement which settles an
internal armed conflict cannot be ascribed the same status as one which settles an
international armed conflict which, essentially, must be between two or more warring
States. The Lomé Agreement cannot be characterised as an international instrument. x x x"
(Emphasis, italics and underscoring supplied)

Similarly, that the MOA-AD would have been signed by representatives of States and
international organizations not parties to the Agreement would not have sufficed to vest in it a
binding character under international law.

In another vein, concern has been raised that the MOA-AD would amount to a unilateral
declaration of the Philippine State, binding under international law, that it would comply with all
the stipulations stated therein, with the result that it would have to amend its Constitution
accordingly regardless of the true will of the people. Cited as authority for this view is Australia
v. France,181 also known as the Nuclear Tests Case, decided by the International Court of Justice
(ICJ).

In the Nuclear Tests Case, Australia challenged before the ICJ the legality of France's nuclear
tests in the South Pacific. France refused to appear in the case, but public statements from its
President, and similar statements from other French officials including its Minister of Defence,
that its 1974 series of atmospheric tests would be its last, persuaded the ICJ to dismiss the case.182
Those statements, the ICJ held, amounted to a legal undertaking addressed to the international
community, which required no acceptance from other States for it to become effective.

Essential to the ICJ ruling is its finding that the French government intended to be bound to the
international community in issuing its public statements, viz:

43. It is well recognized that declarations made by way of unilateral acts, concerning legal or
factual situations, may have the effect of creating legal obligations. Declarations of this kind may
be, and often are, very specific. When it is the intention of the State making the declaration
that it should become bound according to its terms, that intention confers on the
declaration the character of a legal undertaking, the State being thenceforth legally
required to follow a course of conduct consistent with the declaration. An undertaking of this
kind, if given publicly, and with an intent to be bound, even though not made within the context
of international negotiations, is binding. In these circumstances, nothing in the nature of a quid
pro quo nor any subsequent acceptance of the declaration, nor even any reply or reaction from
other States, is required for the declaration to take effect, since such a requirement would be
inconsistent with the strictly unilateral nature of the juridical act by which the pronouncement by
the State was made.

44. Of course, not all unilateral acts imply obligation; but a State may choose to take up a
certain position in relation to a particular matter with the intention of being bound-the
intention is to be ascertained by interpretation of the act. When States make statements by
which their freedom of action is to be limited, a restrictive interpretation is called for.

xxx

51. In announcing that the 1974 series of atmospheric tests would be the last, the French
Government conveyed to the world at large, including the Applicant, its intention
effectively to terminate these tests. It was bound to assume that other States might take
note of these statements and rely on their being effective. The validity of these statements
and their legal consequences must be considered within the general framework of the
security of international intercourse, and the confidence and trust which are so essential in the
relations among States. It is from the actual substance of these statements, and from the
circumstances attending their making, that the legal implications of the unilateral act must
be deduced. The objects of these statements are clear and they were addressed to the
international community as a whole, and the Court holds that they constitute an
undertaking possessing legal effect. The Court considers *270 that the President of the
Republic, in deciding upon the effective cessation of atmospheric tests, gave an undertaking to
the international community to which his words were addressed. x x x (Emphasis and
underscoring supplied) cralawlibrary

As gathered from the above-quoted ruling of the ICJ, public statements of a state representative
may be construed as a unilateral declaration only when the following conditions are present: the
statements were clearly addressed to the international community, the state intended to be bound
to that community by its statements, and that not to give legal effect to those statements would be
detrimental to the security of international intercourse. Plainly, unilateral declarations arise only
in peculiar circumstances.

The limited applicability of the Nuclear Tests Case ruling was recognized in a later case decided
by the ICJ entitled Burkina Faso v. Mali,183 also known as the Case Concerning the Frontier
Dispute. The public declaration subject of that case was a statement made by the President of
Mali, in an interview by a foreign press agency, that Mali would abide by the decision to be
issued by a commission of the Organization of African Unity on a frontier dispute then pending
between Mali and Burkina Faso.
Unlike in the Nuclear Tests Case, the ICJ held that the statement of Mali's President was not a
unilateral act with legal implications. It clarified that its ruling in the Nuclear Tests case rested
on the peculiar circumstances surrounding the French declaration subject thereof, to wit:

40. In order to assess the intentions of the author of a unilateral act, account must be taken of all
the factual circumstances in which the act occurred. For example, in the Nuclear Tests cases,
the Court took the view that since the applicant States were not the only ones concerned at
the possible continuance of atmospheric testing by the French Government, that
Government's unilateral declarations had 'conveyed to the world at large, including the
Applicant, its intention effectively to terminate these tests' (I. C.J. Reports 1974, p. 269, para.
51; p. 474, para. 53). In the particular circumstances of those cases, the French Government
could not express an intention to be bound otherwise than by unilateral declarations. It is
difficult to see how it could have accepted the terms of a negotiated solution with each of
the applicants without thereby jeopardizing its contention that its conduct was lawful. The
circumstances of the present case are radically different. Here, there was nothing to hinder
the Parties from manifesting an intention to accept the binding character of the conclusions
of the Organization of African Unity Mediation Commission by the normal method: a
formal agreement on the basis of reciprocity. Since no agreement of this kind was concluded
between the Parties, the Chamber finds that there are no grounds to interpret the declaration
made by Mali's head of State on 11 April 1975 as a unilateral act with legal implications in
regard to the present case. (Emphasis and underscoring supplied) cralawlibrary

Assessing the MOA-AD in light of the above criteria, it would not have amounted to a unilateral
declaration on the part of the Philippine State to the international community. The Philippine
panel did not draft the same with the clear intention of being bound thereby to the international
community as a whole or to any State, but only to the MILF. While there were States and
international organizations involved, one way or another, in the negotiation and projected signing
of the MOA-AD, they participated merely as witnesses or, in the case of Malaysia, as facilitator.
As held in the Lomé Accord case, the mere fact that in addition to the parties to the conflict, the
peace settlement is signed by representatives of states and international organizations does not
mean that the agreement is internationalized so as to create obligations in international law.

Since the commitments in the MOA-AD were not addressed to States, not to give legal effect to
such commitments would not be detrimental to the security of international intercourse - to the
trust and confidence essential in the relations among States.

In one important respect, the circumstances surrounding the MOA-AD are closer to that of
Burkina Faso wherein, as already discussed, the Mali President's statement was not held to be a
binding unilateral declaration by the ICJ. As in that case, there was also nothing to hinder the
Philippine panel, had it really been its intention to be bound to other States, to manifest that
intention by formal agreement. Here, that formal agreement would have come about by the
inclusion in the MOA-AD of a clear commitment to be legally bound to the international
community, not just the MILF, and by an equally clear indication that the signatures of the
participating states-representatives would constitute an acceptance of that commitment. Entering
into such a formal agreement would not have resulted in a loss of face for the Philippine
government before the international community, which was one of the difficulties that prevented
the French Government from entering into a formal agreement with other countries. That the
Philippine panel did not enter into such a formal agreement suggests that it had no intention to be
bound to the international community. On that ground, the MOA-AD may not be considered a
unilateral declaration under international law.

The MOA-AD not being a document that can bind the Philippines under international law
notwithstanding, respondents' almost consummated act of guaranteeing amendments to the
legal framework is, by itself, sufficient to constitute grave abuse of discretion. The grave
abuse lies not in the fact that they considered, as a solution to the Moro Problem, the creation of
a state within a state, but in their brazen willingness to guarantee that Congress and the
sovereign Filipino people would give their imprimatur to their solution. Upholding such an
act would amount to authorizing a usurpation of the constituent powers vested only in Congress,
a Constitutional Convention, or the people themselves through the process of initiative, for the
only way that the Executive can ensure the outcome of the amendment process is through an
undue influence or interference with that process.

The sovereign people may, if it so desired, go to the extent of giving up a portion of its own
territory to the Moros for the sake of peace, for it can change the Constitution in any it wants, so
long as the change is not inconsistent with what, in international law, is known as Jus Cogens.184
Respondents, however, may not preempt it in that decision.

SUMMARY

The petitions are ripe for adjudication. The failure of respondents to consult the local
government units or communities affected constitutes a departure by respondents from their
mandate under E.O. No. 3. Moreover, respondents exceeded their authority by the mere act of
guaranteeing amendments to the Constitution. Any alleged violation of the Constitution by any
branch of government is a proper matter for judicial review.

As the petitions involve constitutional issues which are of paramount public interest or of
transcendental importance, the Court grants the petitioners, petitioners-in-intervention and
intervening respondents the requisite locus standi in keeping with the liberal stance adopted in
David v. Macapagal-Arroyo.

Contrary to the assertion of respondents that the non-signing of the MOA-AD and the eventual
dissolution of the GRP Peace Panel mooted the present petitions, the Court finds that the present
petitions provide an exception to the "moot and academic" principle in view of (a) the grave
violation of the Constitution involved; (b) the exceptional character of the situation and
paramount public interest; (c) the need to formulate controlling principles to guide the bench, the
bar, and the public; and (d) the fact that the case is capable of repetition yet evading review.

The MOA-AD is a significant part of a series of agreements necessary to carry out the GRP-
MILF Tripoli Agreement on Peace signed by the government and the MILF back in June 2001.
Hence, the present MOA-AD can be renegotiated or another one drawn up that could contain
similar or significantly dissimilar provisions compared to the original.
The Court, however, finds that the prayers for mandamus have been rendered moot in view of
the respondents' action in providing the Court and the petitioners with the official copy of the
final draft of the MOA-AD and its annexes.

The people's right to information on matters of public concern under Sec. 7, Article III of the
Constitution is in splendid symmetry with the state policy of full public disclosure of all its
transactions involving public interest under Sec. 28, Article II of the Constitution. The right to
information guarantees the right of the people to demand information, while Section 28
recognizes the duty of officialdom to give information even if nobody demands. The complete
and effective exercise of the right to information necessitates that its complementary provision
on public disclosure derive the same self-executory nature, subject only to reasonable safeguards
or limitations as may be provided by law.

The contents of the MOA-AD is a matter of paramount public concern involving public interest
in the highest order. In declaring that the right to information contemplates steps and
negotiations leading to the consummation of the contract, jurisprudence finds no distinction as to
the executory nature or commercial character of the agreement.

An essential element of these twin freedoms is to keep a continuing dialogue or process of

communication between the government and the people. Corollary to these twin rights is the
design for feedback mechanisms. The right to public consultation was envisioned to be a species
of these public rights.

At least three pertinent laws animate these constitutional imperatives and justify the exercise of
the people's right to be consulted on relevant matters relating to the peace agenda.

One, E.O. No. 3 itself is replete with mechanics for continuing consultations on both national
and local levels and for a principal forum for consensus-building. In fact, it is the duty of the
Presidential Adviser on the Peace Process to conduct regular dialogues to seek relevant
information, comments, advice, and recommendations from peace partners and concerned
sectors of society.

Two, Republic Act No. 7160 or the Local Government Code of 1991 requires all national offices
to conduct consultations before any project or program critical to the environment and human
ecology including those that may call for the eviction of a particular group of people residing in
such locality, is implemented therein. The MOA-AD is one peculiar program that unequivocally
and unilaterally vests ownership of a vast territory to the Bangsamoro people, which could
pervasively and drastically result to the diaspora or displacement of a great number of inhabitants
from their total environment.

Three, Republic Act No. 8371 or the Indigenous Peoples Rights Act of 1997 provides for clear-
cut procedure for the recognition and delineation of ancestral domain, which entails, among
other things, the observance of the free and prior informed consent of the Indigenous Cultural
Communities/Indigenous Peoples. Notably, the statute does not grant the Executive Department
or any government agency the power to delineate and recognize an ancestral domain claim by
mere agreement or compromise.
The invocation of the doctrine of executive privilege as a defense to the general right to
information or the specific right to consultation is untenable. The various explicit legal
provisions fly in the face of executive secrecy. In any event, respondents effectively waived such
defense after it unconditionally disclosed the official copies of the final draft of the MOA-AD,
for judicial compliance and public scrutiny.

In sum, the Presidential Adviser on the Peace Process committed grave abuse of discretion when
he failed to carry out the pertinent consultation process, as mandated by E.O. No. 3, Republic
Act No. 7160, and Republic Act No. 8371. The furtive process by which the MOA-AD was
designed and crafted runs contrary to and in excess of the legal authority, and amounts to a
whimsical, capricious, oppressive, arbitrary and despotic exercise thereof. It illustrates a gross
evasion of positive duty and a virtual refusal to perform the duty enjoined.

The MOA-AD cannot be reconciled with the present Constitution and laws. Not only its specific
provisions but the very concept underlying them, namely, the associative relationship envisioned
between the GRP and the BJE, are unconstitutional, for the concept presupposes that the
associated entity is a state and implies that the same is on its way to independence.

While there is a clause in the MOA-AD stating that the provisions thereof inconsistent with the
present legal framework will not be effective until that framework is amended, the same does not
cure its defect. The inclusion of provisions in the MOA-AD establishing an associative
relationship between the BJE and the Central Government is, itself, a violation of the
Memorandum of Instructions From The President dated March 1, 2001, addressed to the
government peace panel. Moreover, as the clause is worded, it virtually guarantees that the
necessary amendments to the Constitution and the laws will eventually be put in place. Neither
the GRP Peace Panel nor the President herself is authorized to make such a guarantee. Upholding
such an act would amount to authorizing a usurpation of the constituent powers vested only in
Congress, a Constitutional Convention, or the people themselves through the process of
initiative, for the only way that the Executive can ensure the outcome of the amendment process
is through an undue influence or interference with that process.

While the MOA-AD would not amount to an international agreement or unilateral declaration
binding on the Philippines under international law, respondents' act of guaranteeing amendments
is, by itself, already a constitutional violation that renders the MOA-AD fatally defective.

WHEREFORE, respondents' motion to dismiss is DENIED. The main and intervening petitions
are GIVEN DUE COURSE and hereby GRANTED.

The Memorandum of Agreement on the Ancestral Domain Aspect of the GRP-MILF Tripoli
Agreement on Peace of 2001 is declared contrary to law and the Constitution.

SO ORDERED.
[G.R. No. L-5279. October 31, 1955.]

PHILIPPINE ASSOCIATION OF COLLEGES AND UNIVERSITIES, ETC., Petitioner, v. SECRETARY OF

EDUCATION and the BOARD OF TEXTBOOKS, Respondents.

SYLLABUS

1. CONSTITUTIONAL LAW; WHEN QUESTION OF CONSTITUTIONALITY MAY BE

RAISED; JUSTICIABLE CONTROVERSY. — Where the petitioning private schools are
actually operating by virtue of permits issued to them by the Secretary of Education under Act
No. 2706, who is not shown to have threatened to revoke their permits, there is no justiciable
controversy that would authorize the courts to pass upon the constitutionality of said Act.

2. ID.; POLICE POWER; SCHOOLS AND COLLEGES; PREVIOUS PERMIT SYSTEM. —

The Government, in the exercise of its police power to correct a great evil, which consisted in
that the great majority of the private schools from primary grade to university are money-making
devices for the profit of those who organize and administer them, may validly establish the
previous permit system provided for by Commonwealth Act No. 180.

3. ID.; ID.; ID.; DISCRETION OF SECRETARY OF EDUCATION; FIXING OF MINIMUM

STANDARDS OF INSTITUTION. — To confer, by statute, upon the Secretary of Education
power and discretion to prescribed rules fixing minimum standards of adequate and efficient
instruction to be observed by all private schools and colleges, is not unduly delegate legislative
powers.
DECISION

BENGZON, J.:

The petitioning colleges and universities request that Act No. 2706 as amended by Act No. 3075
and Commonwealth Act No. 180 be declared unconstitutional, because: A. They deprive owners
of schools and colleges as well as teachers and parents of liberty and property without due
process of law; B. They deprive parents of their natural right and duty to rear their children for
civic efficiency; and C. Their provisions conferring on the Secretary of Education unlimited
power and discretion to prescribe rules and standards constitute an unlawful delegation of
legislative power.

A printed memorandum explaining their position in extenso is attached to the record.

The Government’s legal representative submitted a mimeographed memorandum contending

that, (1) the matter constitutes no justiciable controversy exhibiting unavoidable necessity of
deciding the constitutional questions; (2) petitioners are in estoppel to challenge the validity of
the said acts and (3) the Acts are constitutionally valid.

Petitioners submitted a lengthy reply to the above arguments.

Act No. 2706 approved in 1917 is entitled, "An Act making the inspection and recognition of
private schools and colleges obligatory for the Secretary of Public Instruction." Under its
provisions, the Department of Education has, for the past 37 years, supervised and regulated all
private schools in this country apparently without audible protest, nay, with the general
acquiescence of the general public and the parties concerned.

It should be understandable, then, that this Court should be doubly reluctant to consider
petitioner’s demand for avoidance of the law aforesaid, specially where, as respondents assert,
petitioners suffered no wrong — nor allege any — from the enforcement of the criticized statute.

"It must be evident to any one that the power to declare a legislative enactment void is one which
the judge, conscious of the fallibility of the human judgment, will shrink from exercising in any
case where he can conscientiously and with due regard to duty and official oath decline the
responsibility." (Cooley Constitutional Limitations, 8th Ed., Vol. I, p. 332.)

When a law has been long treated as constitutional and important rights have become dependent
thereon, the Court may refuse to consider an attack on its validity. (C. J. S. 16, p. 204.)

As a general rule, the constitutionality of a statute will be passed on only if, and to the extent
that, it is directly and necessarily involved in a justiciable controversy and is essential to the
protection of the rights of the parties concerned. (16 C. J. S., p. 207.)

In support of their first proposition petitioners contend that the right of a citizen to own and
operate a school is guaranteed by the Constitution, and any law requiring previous governmental
approval or permit before such person could exercise said right, amounts to censorship of
previous restraint, a practice abhorent to our system of law and government. Petitioners
obviously refer to section 3 of Act No. 2706 as amended which provides that before a private
school may be opened to the public it must first obtain a permit from the Secretary of Education.
The Solicitor General on the other hand points out that none of petitioners has cause to present
this issue, because all of them have permits to operate and are actually operating by virtue of
their permits. 1 And they do not assert that the respondent Secretary of Education has threatened
to revoke their permits. They have suffered no wrong under the terms of the law — and,
naturally need no relief in the form they now seek to obtain.

"It is an established principle that to entitle a private individual immediately in danger of

sustaining a direct injury as the result of that action and it is not sufficient that he has merely a
general to invoke the judicial power to determine the validity of executive or legislative action he
must show that he has sustained or is interest common to all members of the public." (Ex parte
Levitt, 302 U. S. 633 82 L. Ed. 493.)

"Courts will not pass upon the constitutionality of a law" upon the complaint of one who fails to
show that he is injured by its operation. (Tyler v. Judges, 179 U. S. 405; Hendrick v. Maryland,
235 U. S. 610; Coffman v. Breeze Corp., 323 U. S. 316-325.)
"The power of courts to declare a law unconstitutional arises only when the interests of litigants
require the use of that judicial authority for their protection against actual interference, a
hypothetical threat being insufficient." (United Public Works v. Mitchell, 330 U. S. 75; 91 L. Ed.
754.)

"Bona fide suit. — Judicial power is limited to the decision of actual cases and controversies.
The authority to pass on the validity of statutes is incidental to the decision of such cases where
conflicting claims under the Constitution and under a legislative act assailed as contrary to the
Constitution are raised. It is legitimate only in the last resort, and as necessity in the
determination of real, earnest, and vital controversy between litigants." (Tañada and Fernando,
Constitution of the Philippines, p. 1138.)

Mere apprehension that the Secretary of Education might under the law withdraw the permit of
one of petitioners does not constitute a justiciable controversy. (Cf. Com. ex rel Watkins v.
Winchester Waterworks (Ky.) 197 S. W. 2d. 771.)

An action, like this, is brought for a positive purpose, nay, to obtain actual and positive relief.
(Salonga v. Warner Barnes, L-2245, January, 1951.) Courts do not sit to adjudicate mere
academic questions to satisfy scholarly interest therein however intellectually solid the problem
may be. This is specially true where the issues "reach constitutional dimensions, for then there
comes into play regard for the court’s duty to avoid decision of constitutional issues unless
avoidance becomes evasion." (Rice v. Sioux City, U. S. Sup. Ct. Adv. Rep., May 23, 1955, Law
Ed., Vol. 99, p. 511.)

The above notwithstanding, in view of the several decisions of the United States Supreme Court
quoted by petitioners, apparently outlawing censorship of the kind objected to by them, we have
decided to look into the matter, lest they may allege we refused to act even in the face of clear
violation of fundamental personal rights of liberty and property.

Petitioners complain that before opening a school the owner must secure a permit from the
Secretary of Education. Such requirement was not originally included in Act No. 2706. It was
introduced by Commonwealth Act No. 180 approved in 1936. Why?

In March 1924 the Philippine Legislature approved Act No. 3162 creating a Board of
Educational Survey to make a study and survey of education in the Philippines and of all
educational institutions, facilities and agencies thereof. A Board chairmaned by Dr. Paul
Munroe, Columbia University, assisted by a staff of carefully selected technical members
performed the task, made a five-month thorough and impartial examination of the local
educational system, and submitted a report with recommendations, printed as a book of 671
pages. The following paragraphs are taken from such report: jgc:chanrobles.com.ph

"PRIVATE-ADVENTURE SCHOOLS

There is no law or regulation in the Philippine Islands today to prevent a person, however
disqualified by ignorance, greed, or even immoral character, from opening a school to teach the
young. It true that in order to post over the door ’Recognized by the Government,’ a private
adventure school must first be inspected by the proper Government official, but a refusal to grant
such recognition does not by any means result in such a school ceasing to exist. As a matter of
fact, there are more such nonrecognized private schools than of the recognized variety. How
many, no one knows, as the Division of Private Schools keeps records only of the recognized
type." cralaw virtua1aw library

Conclusion. — An unprejudiced consideration of the fact presented under the caption Private
Adventure Schools leads but to one conclusion, viz. : the great majority of them from primary
grade to university are money-making devices for the profit of those who organize and
administer them. The people whose children and youth attend them are not getting what they pay
for. It is obvious that the system constitutes a great evil. That it should be permitted to exist with
almost no supervision is indefensible. The suggestion has been made with the reference to the
private institutions of university grade that some board of control be organized under legislative
control to supervise their administration. The Commission believes that the recommendations it
offers at the end of this chapter are more likely to bring about the needed reforms.

Recommendations. — The Commission recommends that legislation be enacted to prohibit the

opening of any school by an individual or organization without the permission of the Secretary
of Public Instruction. That before granting such permission the Secretary assure himself that such
school measures up to proper standards in the following respects, and that the continued
existence of the school be dependent upon its continuing to conform to these conditions: chanrob1es virtual 1aw library

(1) The location and construction of the buildings, the lighting and ventilation of the rooms, the
nature of the lavatories, closets, water supply, school furniture and apparatus, and methods of
cleaning shall be such as to insure hygienic conditions for both pupils and teachers.

(2) The library and laboratory facilities shall be adequate to the needs of instruction in the
subjects taught.

(3) The classes shall not show an excessive number of pupils per teacher. The Commission
recommends 40 as a maximum.

(4) The teachers shall meet qualifications equal to those of teachers in the public schools of the
same grade.

x       x       x"

In view of these finding and recommendations, can there be any doubt that the Government in
the exercise of its police power to correct "a great evil" could validly establish the "previous
permit" system objected to by petitioners? This is what differentiates our law from the other
statutes declared invalid in other jurisdictions. And if any doubt still exists, recourse may now be
had to the provision of our Constitution that "All educational institutions shall be under the
supervision and subject to regulation by the State." (Art. XIV, sec. 5.) The power to regulate
establishments or business occupations implies the power to require a permit or license. (53 C. J.
S. 4.)
What goes for the "previous permit" naturally goes for the power to revoke such permit on
account of violation of rules or regulations of the Department.

II. This brings us to the petitioners’ third proposition that the questioned statutes "conferring on
the Secretary of Education unlimited power and discretion to prescribe rules and standards
constitute an unlawful delegation of legislative power." cralaw virtua1aw library

This attack is specifically aimed at section 1 of Act No. 2706 which, as amended, provides: jgc:chanrobles.com.ph

"It shall be the duty of the Secretary of Public Instruction to maintain a general standard of
efficiency in all private schools and colleges of the Philippines so that the same shall furnish
adequate instruction to the public, in accordance with the class and grade of instruction given in
them, and for this purpose said Secretary or his duly authorized representative shall have
authority to advise, inspect, and regulate said schools and colleges in order to determine the
efficiency of instruction given in the same,"

"Nowhere in this Act" petitioners argue "can one find any description, either general or specific,
of what constitutes a ’general standard of efficiency.’ Nowhere in this Act is there any indication
of any basis or condition to ascertain what is ’adequate instruction to the public.’ Nowhere in this
Act is there any statement of conditions, acts, or factors, which the Secretary of Education must
take into account to determine the ’efficiency of instruction.’"

The attack on this score is also extended to section 6 which provides: jgc:chanrobles.com.ph

"The Department of Education shall from time to time prepare and publish in pamphlet form the
minimum standards required of primary, intermediate, and high schools, and colleges granting
the degrees of Bachelor of Arts, Bachelor of Science, or any other academic degree. It shall also
from time to time prepare and publish in pamphlet form the minimum standards required of law,
medical, dental, pharmaceutical, engineering, agricultural and other medical or vocational
schools or colleges giving instruction of a technical, vocational or professional character." cralaw virtua1aw library

Petitioners reason out, "this section leaves everything to the uncontrolled discretion of the
Secretary of Education or his department. The Secretary of Education is given the power to fix
the standard. In plain language, the statute turns over to the Secretary of Education the exclusive
authority of the legislature to formulate standard . . ."
cralaw virtua1aw library

It is quite clear the two sections empower and require the Secretary of Education to prescribe
rules fixing minimum standards of adequate and efficient instruction to be observed by all such
private schools and colleges as may be permitted to operate. The petitioners contend that as the
legislature has not fixed the standards, "the provision is extremely vague, indefinite and
uncertain" — and for that reason constitutionality objectionable. The best answer is that despite
such alleged vagueness the Secretary of Education has fixed standards to ensure adequate and
efficient instruction, as shown by the memoranda fixing or revising curricula, the school
calendars, entrance and final examinations, admission and accreditation of students etc.; and the
system of private education has, in general, been satisfactorily in operation for 37 years. Which
only shows that the Legislature did and could, validly rely upon the educational experience and
training of those in charge of the Department of Education to ascertain and formulate minimum
requirements of adequate instruction as the basis of government recognition of any private
school.

At any rate, petitioners do not show how these standards have injured any of them or interfered
with their operation. Wherefore, no reason exists for them to assail the validity of the power nor
the exercise of the power by the Secretary of Education.

True, the petitioners assert that, the Secretary has issued rules and regulations "whimsical and
capricious" and that such discretionary power has produced arrogant inspectors who "bully heads
and teachers of private schools." Nevertheless, their remedy is to challenge those regulations
specifically, and/or to ring those inspectors to book, in proper administrative or judicial
proceedings — not to invalidate the law. For it needs no argument, to show that abuse by the
officials entrusted with the execution of a statute does not per se demonstrate the
unconstitutionality of such statute.

Anyway, way find the defendants’ position to be sufficiently sustained by the decision in Alegre
v. Collector of Customs, 53 Phil., 394 upholding the statute that authorized the Director of
Agriculture to "designate standards for the commercial grades of abaca, maguey and sisal"
against vigorous attacks on the ground of invalid delegation of legislative power.

Indeed "adequate and efficient instruction" should be considered sufficient, in the same way as
"public welfare" "necessary in the interest of law and order" "public interest" and "justice and
equity and substantial merits of the case" have been held sufficient as legislative standards
justifying delegation of authority to regulate. (See Tañada and Fernando, Constitution of the
Philippines, p. 793, citing Philippine cases.)

On this phase of the litigation we conclude that there has been no undue delegation of legislative
power.

In this connection, and to support their position that the law and the Secretary of Education have
transcended the governmental power of supervision and regulation, the petitioners appended a
list of circulars and memoranda issued by the said Department. However they failed to indicate
which of such official documents was constitutionally objectionable for being "capricious," or
plain "nuisance" ; and it is one of our decisional practices that unless a constitutional point is
specifically raised, insisted upon and adequately argued, the court will not consider it. (Santiago
v. Far Eastern, 73 Phil., 408.)

We are told that such list will give an idea of how the statute has placed in the hands of the
Secretary of Education complete control of the various activities of private schools, and why the
statute should be struck down as unconstitutional. It is clear in our opinion that the statute does
not in express terms give the Secretary complete control. It gives him powers to inspect private
schools, to regulate their activities, to give them official permits to operate under certain
conditions, and to revoke such permits for cause. This does not amount to complete control. If
any of such Department circulars or memoranda issued by the Secretary go beyond the bounds of
regulation and seeks to establish complete control, it would surely be invalid. Conceivably some
of them are of this nature, but besides not having before us the text of such circulars, the
petitioners have omitted to specify. In any event with the recent approval of Republic Act No.
1124 creating the National Board of Education, opportunity for administrative correction of the
supposed anomalies or encroachments is amply afforded herein petitioners. A more expeditious
and perhaps more technically competent forum exists, wherein to discuss the necessity,
convenience or relevancy of the measures criticized by them. (See also Republic Act No. 176.)

If however the statutes in question actually give the Secretary control over private schools, the
question arises whether the power of supervision and regulation granted to the State by section 5
Article XIV was meant to include control of private educational institutions. It is enough to point
out that local educators and writers think the Constitution provides for control of Education by
the State. (See Tolentino, Government of the Philippines (1950), p. 401; Aruego, Framing of the
Philippine Constitution, Vol. II, p. 615; Benitez, Philippine Social Life and Progress, p. 335.)

The Constitution (it) "provides for state control of all educational institutions" even as it
enumerates certain fundamental objectives of all education to wit, the development of moral
character, personal discipline, civic conscience and vocational efficiency, and instruction in the
duties of citizenship. (Malcolm & Laurel, Philippine Constitutional Law, 1936.)

The Solicitor General cities many authorities to show that the power to regulate means power to
control, and quotes from the proceedings of the Constitutional Convention to prove that State
control of private education was intended by the organic law. It is significant to note that the
Constitution grants power to supervise and to regulate. Which may mean greater power than
mere regulation.

III. Another grievance of petitioners — probably the most significant — is the assessment of 1
per cent levied on gross receipts of all private schools for additional Government expenses in
connection with their supervision and regulation. The statute is section 11-A of Act No. 2706 as
amended by Republic Act No. 74 which reads as follows: jgc:chanrobles.com.ph

"SEC. 11-A. The total annual expense of the Office of Private Education shall be met by the
regular amount appropriated in the annual Appropriation Act: Provided, however, That for
additional expenses in the supervision and regulation of private schools, colleges and universities
and in the purchase of textbooks to be sold to students of said schools, colleges and universities
the President of the Philippines may authorize the Secretary of Instruction to levy an equitable
assessment from each private educational institution equivalent to one percent of the total
amount accruing from tuition and other fees: . . . and non-payment of the assessment herein
provided by any private school, college or university shall be sufficient cause for the cancellation
by the Secretary of Instruction of the permit for recognition granted to it." cralaw virtua1aw library

Petitioners maintain that this is a tax on the exercise of a constitutional right — the right to open
a school, the liberty to teach etc. They claim this is unconstitutional, in the same way that taxes
on the privilege of selling religious literature or of publishing a newspaper — both constitutional
privileges — have been held, in the United States, to be invalid as taxes on the exercise of a
constitutional right.
The Solicitor General on the other hand argues that insofar as petitioners’ action attempts to
restrain the further collection of the assessment, courts have no jurisdiction to restrain the
collection of taxes by injunction, and in so far as they seek to recover fees already paid the suit, it
is one against the State without its consent. Anyway he concludes, the action involving "the
legality of any tax impost or assessment" falls within the original jurisdiction of Courts of First
Instance.

There are good grounds in support of the Government’s position. If this levy of 1 per cent is truly
a mere fee — and not a tax — to finance the cost of the Department’s duty and power to regulate
and supervise private schools, the exaction may be upheld; but such point involves investigation
and examination of relevant data, which should best be carried out in the lower courts. If on the
other hand it is a tax, petitioners’ issue would still be within the original jurisdiction of the
Courts of First Instance.

The last grievance of petitioners relates to the validity of Republic Act No. 139 which in its
section 1 provides:jgc:chanrobles.com.ph

"The textbooks to be used in the private schools recognized or authorized by the government
shall be submitted to the Board (Board of Textbooks) which shall have the power to prohibit the
use of any of said textbooks which it may find to be against the law or to off end the dignity and
honor of the government and people of the Philippines, or which it may find to be against the
general policies of the government, or which it may deem pedagogically unsuitable." cralaw virtua1aw library

This power of the Board, petitioners aver, is censorship in "its baldest form." They cite two U. S.
cases (Miss. and Minnesota) outlawing statutes that impose previous restraints upon publication
of newspapers, or curtail the right of individuals to disseminate teachings critical of government
institutions or policies.

Herein lies another important issue submitted in the cause. The question is really whether the law
may be enacted in the exercise of the State’s constitutional power (Art. XIV, sec. 5) to supervise
and regulate private schools. If that power amounts to control of private schools, as some think it
is, maybe the law is valid. In this connection we do not share the belief that section 5 has added
new power to what the State inherently possesses by virtue of the police power. An express
power is necessarily more extensive than a mere implied power. 1 For instance, if there is
conflict between an express individual right 2 and the express power to control private education
it cannot off-hand be said that the latter must yield to the former — conflict of two express
powers. But if the power to control education is merely implied from the police power, it is
feasible to uphold the express individual right, as was probably the situation in the two decisions
brought to our attention, of Mississippi and Minnesota, states where constitutional control of
private schools is not expressly produced.

However, as herein previously noted, no justiciable controversy has been presented to us. We are
not informed that the Board on Textbooks has prohibited this or that text, or that the petitioners
refused or intend to refuse to submit some textbooks, and are in danger of losing substantial
privileges or rights for so refusing.
The average lawyer who reads the above quoted section of Republic Act 139 will fail to perceive
anything objectionable. Why should not the State prohibit the use of textbooks that are illegal, or
offensive to the Filipinos or adverse to governmental policies or educationally improper? What’s
the power of regulation and supervision for? But those trained to the investigation of
constitutional issues are likely to apprehend the danger to civil liberties, of possible educational
dictatorship or thought control, as petitioners’ counsel foresee with obvious alarm. Much
depends, however, upon the execution and implementation of the statute. Not that
constitutionality depends necessarily upon the law’s effects. But if the Board on Textbooks in its
actuations strictly adheres to the letter of the section and wisely steers a middle course between
the Scylla of "dictatorship" and the Charybdis of "thought control", no cause for complaint will
arise and no occasion for judicial review will develop. Anyway, and again, petitioners now have
a more expeditious remedy thru an administrative appeal to the National Board of Education
created by Republic Act 1124.

Of course it is unnecessary to assure herein petitioners, that when and if, the dangers they
apprehend materialize and judicial intervention is suitably invoked, after all administrative
remedies are exhausted, the courts will not shrink from their duty to delimit constitutional
boundaries and protect individual liberties.

IV. For all the foregoing considerations, reserving to the petitioners the right to institute in the
proper court, and at the proper time, such actions as may call for decision of the issues herein
presented by them, this petition for prohibition will be denied. So ordered.
 [G.R. NO. 192377 - July 25, 2012]

CESAR V. MADRIAGA, JR., Petitioner, v. CHINA BANKING CORPORATION,

Respondent.

DECISION

REYES, J.:

Before us is a Petition for Review of the Decision1 dated January 27, 2010 of the Court of
Appeals (CA) dismissing the petition for certiorari and the Resolution2 dated May 26, 2010
denying the motion for reconsideration thereof in CA-G.R. SP No. 96640.

The CA upheld the Order3 dated August 11, 2006 of the Regional Trial Court (RTC), Branch 17
of Malolos, in Civil Case No. P-167-2002 denying herein petitioner Cesar V. Madriaga, Jr. s
(petitioner) motion to quash the ex parte writ of possession issued in favor of herein respondent
China Banking Corporation (China Bank).

Factual Antecedents

The spouses Rolando and Norma Trajano (Spouses Trajano) were the original registered owners
of the properties in dispute two residential properties located in Ibayo, Marilao, Bulacan, covered
by TCT Nos. 114853(M) and 114854(M). Sometime in 1991, they agreed to sell the properties to
the petitioner s father, Cesar Madriaga, Sr. (Madriaga, Sr.) for P1,300,000.00 payable on
installment basis. Upon completion of payment,4 Spouses Trajano executed in Madriaga, Sr. s
favor a Deed of Absolute Sale dated September 2, 1992.5 ςrνll

Spouses Trajano, however, failed to deliver the lot titles, so Madriaga, Sr. sued for specific
performance with the RTC Branch 19 of Malolos City, and docketed as Civil Case No. 521-M-
93. The parties later entered into a compromise agreement, which the court approved on June 13,
1994.6 It was agreed that Spouses Trajano will take out a loan with Asia Trust Bank secured by a
mortgage over the properties, and from the proceeds, settle the P1,225,000.00 they owed
Madriaga, Sr.. It also appears from the agreement that the titles to the properties were retained by
a certain Mariano and Florentino Blanco as security for a loan received by both Spouses Trajano
and Madriaga, Sr..7 It was also agreed that the notice of lis pendens previously caused by
Madriaga, Sr. to be annotated on the titles will be cancelled.8 ςrνll

Spouses Trajano, however, failed to comply with their obligation under the compromise
judgment. On motion of Madriaga, Sr., the RTC issued a writ of execution on September 6,
1994, and several properties of Spouses Trajano were levied upon, including the disputed
properties. A notice of levy dated January 18, 1995 was also given to the Register of Deeds.9 At
the auction held on February 22, 1995, Madriaga, Sr. was declared the winning bidder, and a
certificate of sale was issued to him on March 22, 1995. After the lapse of the one-year
redemption period, he was issued a final deed of sale; consequently, TCT Nos. 114853(M) and
114854(M) were cancelled and replaced by TCT Nos. T-284713(M) and T-284714 in his name.
On January 27, 1997, he secured an ex parte writ of possession.10 ςrνll

Meanwhile, on January 2, 1995, Spouses Trajano obtained a loan from China Bank in the
amount of P700,000.00, payable in one year and secured by a mortgage over TCT Nos.
114853(M) and 114854(M). They defaulted on their loan, and on October 20, 1997, China Bank
foreclosed the mortgage and was declared the highest bidder at the foreclosure sale held on
November 24, 1997. After consolidation of its titles, TCT Nos. T-346239(M) and T-346240(M)
were issued to China Bank to replace, for the second time, TCT Nos. 114853(M) and
114854(M).11 ςrνll

On April 2, 2002, China Bank filed with the RTC Branch 17 of Malolos, an ex parte petition for
writ of possession, docketed as Civil Case No. P-167-2002. It impleaded as respondents the
"Sps. Trajano and/or all persons claiming rights under their name." The writ was granted on July
12, 2002, and a copy served upon Madriaga, Sr. on August 2, 2002.

On November 1, 2002, Madriaga, Sr. filed an opposition to the writ wherein he asserted that he
was the true owner of the properties, having obtained them at an earlier execution sale, and that
his titles were subsisting. The RTC dismissed his opposition and denied his motion for
reconsideration.

Undeterred, on April 13, 2005, the petitioner filed a "Motion to Quash/Abate the Writ of
Possession,"12 which was denied by the RTC in its Order13 dated February 6, 2006. The RTC
ruled that it had no jurisdiction over the parties contending claims of ownership which was
already pending before RTC Branch 12 of Malolos, docketed as Civil Case No. 406-M-2002
(specific performance case), entitled "Cesar Madriaga v. China Banking Corporation, Register of
Deeds of Meycauayan and Spouses Rolando and Norma Trajano." The RTC also noted that the
petitioner s motion had been mooted by the satisfaction of the writ on April 15, 2005, per the
Sheriff s return.14 ςrνll

On March 6, 2006, the petitioner moved for reconsideration of the Order dated February 6, 2006
in Civil Case No. P-167-2002 (writ of possession case),15 insisting that he was deprived of due
process because he was not served with notice of China Bank s ex parte petition for writ of
possession, and that he came to know of its separate titles only when he was served the writ of
possession.

Unmoved, the RTC denied his motion for reconsideration in its Order16 dated August 11, 2006,
reasoning that it was merely performing a ministerial duty to issue the writ of possession to
China Bank.

The petitioner, who succeeded to his father s properties then filed a petition for certiorari to the
CA averring that the RTC gravely and seriously abused its discretion in denying the motion to
abate/quash the writ of possession; in considering the issuance of the writ as ministerial; and in
not declaring China Bank in bad faith, hence, not entitled to possession of the properties.17 ςrνll
In the Decision dated January 27, 2010, the CA ruled that the RTC did not commit grave abuse
of discretion in denying Madriaga, Sr. s motion to quash or abate the ex parte writ of possession
for the reason that the motion had already been rendered moot and academic after the writ was
satisfied on April 15, 2005 with the physical removal of Madriaga, Sr. from the premises. On
May 26, 2010, the CA denied the petitioner s motion for reconsideration.18 ςrνll

Hence, the present petition.

The petitioner avers that the writ of possession was directed, not against his father, but against
Spouses Trajano and "all persons claiming rights under them." He insists that his father derived
his titles not through a voluntary transaction with Spouses Trajano, but by purchase in an
execution sale. He also maintains that China Bank s titles are void because they came from a
void mortgage.

The petitioner also asserts that the RTC gravely erred in not finding that China Bank failed to
investigate the titles of Spouses Trajano before approving their loan, in view of the lis pendens
annotation thereon. The petitioner adverts to the decision of the RTC in Civil Case No. 406-M-
2002 (specific performance case)19 charging China Bank with notice of a serious flaw in Spouses
Trajano s titles, whereas the petitioner s titles came from an earlier execution sale, and he and his
father had been in open, uninterrupted and adverse possession since 1991.

The petitioner also insists that an ex parte writ of possession can be attacked either directly or
collaterally for being null and void ab initio due to lack of due process, notwithstanding that in
the meantime it has even been satisfied.

The petitioner, thus, maintains that his restoration to possession must be ordered because his
eviction by a mere ex parte writ of possession violated his right to due process, since his father
was unable to participate in the said proceedings due to lack of notice.

Our Ruling

We deny the petition.

The case has been rendered moot and academic by the full implementation/satisfaction of the
writ of possession.

The trial court in its Order dated February 6, 2006 took note of the Sheriff s return stating that
the writ of possession it issued to China Bank had been satisfied on April 15, 2005 after the
petitioner had been successfully removed from the subject premises, prompting the court to
declare that the petitioner s Motion to Quash/Abate the Writ of Possession has been rendered
moot and academic.

Indeed, with the writ of possession having been served and satisfied, the said motions had ceased
to present a justiciable controversy, and a declaration thereon would be of no practical use or
value.20
ςrνll
Judicial power presupposes actual controversies, the very antithesis of mootness. Where there is
no more live subject of controversy, the Court ceases to have a reason to render any ruling or
make any pronouncement.21 Courts generally decline jurisdiction on the ground of mootness save
when, among others, a compelling constitutional issue raised requires the formulation of
controlling principles to guide the bench, the bar and the public; or when the case is capable of
repetition yet evading judicial review,22 which are not extant in this case.

The issuance of the ex parte writ of possession did not violate Madriaga, Sr. s right to due
process.

Section 7 of Act 3135 expressly allows the buyer at the auction to file a verified petition in the
form of an ex parte motion for issuance of a writ of possession. This connotes that it is for the
benefit of one party, without notice to or challenge by an adverse party. Being summary in
nature, it cannot be said to be a judgment on the merits, but is simply an incident in the transfer
of title.23 As pointed out in Philippine National Bank v. Court of Appeals,24 an ex parte petition
for writ of possession under Act 3135 is, strictly speaking, not a judicial, or litigious, proceeding,
for the reason that an extrajudicial foreclosure of mortgage is accomplished by filing a petition,
not with any court of justice, but with the office of the sheriff of the place where the sale is to be
made.

Indeed, the proceeding in a petition for a writ of possession is ex parte and summary in nature. It
is a judicial proceeding brought for the benefit of one party only and without notice by the court
to any person adversely interested. It is a proceeding wherein relief is granted without affording
the person against whom the relief is sought the opportunity to be heard.25 No notice is needed to
be served upon persons interested in the subject property.26 And as held in Carlos v. Court of
Appeals,27 the ex parte nature of the proceeding does not deny due process to the petitioners
because the issuance of the writ of possession does not bar a separate case for annulment of
mortgage and foreclosure sale. Hence, the RTC may grant the petition even in the absence of
Madriaga, Sr. s participation.

Moreover, records show that Madriaga, Sr. was able to air his side when he filed: on November
1, 2002 an opposition to the writ; on April 13, 2005, a "Motion to Quash/Abate the Writ of
Possession"; and on March 6, 2006, a motion for reconsideration of the Order dated February 6,
2006 denying his motion to quash/abate the writ of possession. When a party has been afforded
opportunity to present his side, he cannot feign denial of due process.28 ςrνll

The petitioner s predecessor is not a third-party whose possession of the disputed properties is
adverse to that of Spouses Trajano.

A writ of possession of real property may be issued in cases of extrajudicial foreclosure of a real
estate mortgage under Section 7 of Act 3135, as amended by Act 4118.29 Sec. 7 provides: ςrαlαω

Sec. 7. Possession during redemption period. In any sale made under the provisions of this Act,
the purchaser may petition the Court of First Instance of the province or place where the property
or any part thereof is situated, to give him possession thereof during the redemption period,
furnishing bond in an amount equivalent to the use of the property for a period of twelve months,
to indemnify the debtor in case it be shown that the sale was made without violating the
mortgage or without complying with the requirements of this Act. Such petition shall be made
under oath and filed in form of an ex parte motion in the registration or cadastral proceedings if
the property is registered, or in special proceedings in the case of property registered under the
Mortgage Law or under Sec. 194 of the Administrative Code, or of any other real property
encumbered with a mortgage duly registered in the office of any register of deeds in accordance
with any existing law, and in each case the clerk of court shall, upon the filing of such petition,
collect the fees specified in par. 11 of Sec. 114 of Act No. 496, and the court shall, upon
approval of the bond, order that a writ of possession issue, addressed to the sheriff of the
province in which the property is situated, who shall execute said order immediately.

The right of the owner to the possession of a property is an essential attribute of ownership.30 In
extrajudicial foreclosures, the purchaser becomes the absolute owner when no redemption is
made. Thus, after consolidation of ownership and issuance of a new transfer certificate of title in
the name of the purchaser, he is entitled to possession of the property31 as a matter of right under
Section 7, and its issuance by the RTC is a mere ministerial function.32 ςrνll

The rule, however, admits of an exception. Thus, it is specifically provided in Section 33, Rule
39 of the Rules of Court33 that the possession of the extrajudicially foreclosed property shall be
withheld from the purchaser if a third-party is actually holding the same adversely to the
mortgagor/debtor.34 ςrνll

"Sec. 33. Deed and possession to be given at expiration of redemption period; by whom executed
or given. x x x

x x x The possession of the property shall be given to the purchaser or last redemptioner by the
same officer unless a third party is actually holding the property adversely to the judgment
obligor."

In an extrajudicial foreclosure of real property, when the foreclosed property is in the possession
of a third-party holding the same adversely to the defaulting debtor/mortgagor, the issuance by
the RTC of a writ of possession in favor of the purchaser of the said real property ceases to be
ministerial and may no longer be done ex parte. For the exception to apply, however, the
property need not only be possessed by a third-party, but also held by the third-party adversely to
the debtor/mortgagor.35 ςrνll

In BPI Family Savings Bank, Inc. v. Golden Power Diesel Sales Center, Inc.,36 the Court
discussed the meaning of a "third-party who is actually holding the property adversely to the
judgment obligor"

"The exception provided under Section 33 of Rule 39 of the Revised Rules of Court
contemplates a situation in which a third party holds the property by adverse title or right, such
as that of a co-owner, tenant or usufructuary. The co-owner, agricultural tenant, and usufructuary
possess the property in their own right, and they are not merely the successor or transferee of the
right of possession of another co-owner or the owner of the property."37 ςrνll
It is not disputed that Madriaga, Sr. was in actual possession of the disputed properties at the
time the writ of possession was issued by the RTC. China Bank, on the other hand, has in its
favor TCT Nos. T-346239(M) and T-346240(M) issued pursuant to the extrajudicial foreclosure
sale. The RTC, at that juncture, had no alternative but to issue the writ of possession. As it stated
in its Order dated February 6, 2006," x x x [a]t the time it rendered its Decision on July 12, 2002
(granting the ex parte petition for the issuance of the writ of possession), the evidence obtaining
herein overwhelmingly warranted the issuance of the possessory writ in favor of petitioner
Bank."38ςrνll

Moreover, it must be emphasized that Madriaga, Sr. s possession was by virtue of the 1991
agreement between him and Spouses Trajano for the sale of the properties. As it turned out,
Spouses Trajano reneged on their original contractual undertaking to deliver the titles thereby
prompting the petitioner to pursue his claim over the disputed properties. The writ of execution
and execution sale referred to by the petitioner as basis of their alleged adverse possession was
issued by the RTC, as a matter of course in Civil Case No. 521-M-93, which was the initial civil
case filed by them to compel Spouses Trajano to deliver the title to the properties pursuant to the
sale. The filing of Civil Case No. 521-M-93, the compromise agreement subsequently entered
into by the parties, and the judgment and orders issued by the RTC in said case, in fact,
confinned the existence of the previous transaction between Madriaga, Sr. and Spouses Trajano,
i.e., the transfer of the disputed properties to Madriaga, Sr. by way of sale. Evidently, Madriaga,
Sr.'s interest from the properties sprung from his supposed right as the successor or transferee of
Spouses Trajano. It cannot be gainsaid, therefore, that their claim of possession was acquired
from Spouses Trajano, which cannot be considered adverse or contrary, and the RTC had all the
authority to issue the ex parte writ of possession.

In any event, as we have previously noted, the petitioner has already pursued Civil Case No.
406-M-2002 for "Specific Performance, Nullification of Title, Reconveyance and Damages," a
plenary action to recover possession or an accion reivindicatoria."39 It is in said forum that the
contending ownership claims of the parties, and resultantly the right of possession, can be best
ventilated and resolved with definiteness.

WHEREFORE, the Petition for Review is DENIED for lack of merit.

SO ORDERED.
 [G.R. NO. 170338 : December 23, 2008]

VIRGILIO O. GARCILLANO, Petitioner, v. THE HOUSE OF REPRESENTATIVES

COMMITTEES ON PUBLIC INFORMATION, PUBLIC ORDER AND SAFETY,
NATIONAL DEFENSE AND SECURITY, INFORMATION AND COMMUNICATIONS
TECHNOLOGY, and SUFFRAGE AND ELECTORAL REFORMS, Respondents.

DECISION

NACHURA, J.:

More than three years ago, tapes ostensibly containing a wiretapped conversation purportedly
between the President of the Philippines and a high-ranking official of the Commission on
Elections (COMELEC) surfaced. They captured unprecedented public attention and thrust the
country into a controversy that placed the legitimacy of the present administration on the line,
and resulted in the near-collapse of the Arroyo government. The tapes, notoriously referred to as
the "Hello Garci" tapes, allegedly contained the President's instructions to COMELEC
Commissioner Virgilio Garcillano to manipulate in her favor results of the 2004 presidential
elections. These recordings were to become the subject of heated legislative hearings conducted
separately by committees of both Houses of Congress.1

In the House of Representatives (House), on June 8, 2005, then Minority Floor Leader Francis G.
Escudero delivered a privilege speech, "Tale of Two Tapes," and set in motion a congressional
investigation jointly conducted by the Committees on Public Information, Public Order and
Safety, National Defense and Security, Information and Communications Technology, and
Suffrage and Electoral Reforms (respondent House Committees). During the inquiry, several
versions of the wiretapped conversation emerged. But on July 5, 2005, National Bureau of
Investigation (NBI) Director Reynaldo Wycoco, Atty. Alan Paguia and the lawyer of former NBI
Deputy Director Samuel Ong submitted to the respondent House Committees seven alleged
"original" tape recordings of the supposed three-hour taped conversation. After prolonged and
impassioned debate by the committee members on the admissibility and authenticity of the
recordings, the tapes were eventually played in the chambers of the House.2

On August 3, 2005, the respondent House Committees decided to suspend the hearings
indefinitely. Nevertheless, they decided to prepare committee reports based on the said
recordings and the testimonies of the resource persons.3

Alarmed by these developments, petitioner Virgilio O. Garcillano (Garcillano) filed with this
Court a Petition for Prohibition and Injunction, with Prayer for Temporary Restraining Order
and/or Writ of Preliminary Injunction4 docketed as G.R. No. 170338. He prayed that the
respondent House Committees be restrained from using these tape recordings of the "illegally
obtained" wiretapped conversations in their committee reports and for any other purpose. He
further implored that the said recordings and any reference thereto be ordered stricken off the
records of the inquiry, and the respondent House Committees directed to desist from further
using the recordings in any of the House proceedings.5

Without reaching its denouement, the House discussion and debates on the "Garci tapes"
abruptly stopped.

After more than two years of quiescence, Senator Panfilo Lacson roused the slumbering issue
with a privilege speech, "The Lighthouse That Brought Darkness." In his discourse, Senator
Lacson promised to provide the public "the whole unvarnished truth - the what's, when's,
where's, who's and why's" of the alleged wiretap, and sought an inquiry into the perceived
willingness of telecommunications providers to participate in nefarious wiretapping activities.

On motion of Senator Francis Pangilinan, Senator Lacson's speech was referred to the Senate
Committee on National Defense and Security, chaired by Senator Rodolfo Biazon, who had
previously filed two bills6 seeking to regulate the sale, purchase and use of wiretapping
equipment and to prohibit the Armed Forces of the Philippines (AFP) from performing electoral
duties.7

In the Senate's plenary session the following day, a lengthy debate ensued when Senator Richard
Gordon aired his concern on the possible transgression of Republic Act (R.A.) No. 42008 if the
body were to conduct a legislative inquiry on the matter. On August 28, 2007, Senator Miriam
Defensor-Santiago delivered a privilege speech, articulating her considered view that the
Constitution absolutely bans the use, possession, replay or communication of the contents of the
"Hello Garci" tapes. However, she recommended a legislative investigation into the role of the
Intelligence Service of the AFP (ISAFP), the Philippine National Police or other government
entities in the alleged illegal wiretapping of public officials.9

On September 6, 2007, petitioners Santiago Ranada and Oswaldo Agcaoili, retired justices of the
Court of Appeals, filed before this Court a Petition for Prohibition with Prayer for the Issuance
of a Temporary Restraining Order and/or Writ of Preliminary Injunction,10 docketed as G.R. No.
179275, seeking to bar the Senate from conducting its scheduled legislative inquiry. They argued
in the main that the intended legislative inquiry violates R.A. No. 4200 and Section 3, Article III
of the Constitution.11

As the Court did not issue an injunctive writ, the Senate proceeded with its public hearings on
the "Hello Garci" tapes on September 7,12 1713 and October 1,14 2007.

Intervening as respondents,15 Senators Aquilino Q. Pimentel, Jr., Benigno Noynoy C. Aquino,

Rodolfo G. Biazon, Panfilo M. Lacson, Loren B. Legarda, M.A. Jamby A.S. Madrigal and
Antonio F. Trillanes filed their Comment16 on the petition on September 25, 2007.

The Court subsequently heard the case on oral argument.17

On October 26, 2007, Maj. Lindsay Rex Sagge, a member of the ISAFP and one of the resource
persons summoned by the Senate to appear and testify at its hearings, moved to intervene as
petitioner in G.R. No. 179275.18
On November 20, 2007, the Court resolved to consolidate G.R. NOS. 170338 and 179275.19

It may be noted that while both petitions involve the "Hello Garci" recordings, they have
different objectives–the first is poised at preventing the playing of the tapes in the House and
their subsequent inclusion in the committee reports, and the second seeks to prohibit and stop the
conduct of the Senate inquiry on the wiretapped conversation.

The Court dismisses the first petition, G.R. No. 170338, and grants the second, G.R. No. 179275.

-I-

Before delving into the merits of the case, the Court shall first resolve the issue on the parties'
standing, argued at length in their pleadings.

In Tolentino v. COMELEC,20 we explained that "' [l]egal standing' or locus standi refers to a
personal and substantial interest in a case such that the party has sustained or will sustain direct
injury because of the challenged governmental act x x x," thus,

generally, a party will be allowed to litigate only when (1) he can show that he has personally
suffered some actual or threatened injury because of the allegedly illegal conduct of the
government; (2) the injury is fairly traceable to the challenged action; and (3) the injury is likely
to be redressed by a favorable action.21

The gist of the question of standing is whether a party has "alleged such a personal stake in the
outcome of the controversy as to assure that concrete adverseness which sharpens the
presentation of issues upon which the court so largely depends for illumination of difficult
constitutional questions."22

However, considering that locus standi is a mere procedural technicality, the Court, in recent
cases, has relaxed the stringent direct injury test. David v. Macapagal-Arroyo23 articulates that a
"liberal policy has been observed, allowing ordinary citizens, members of Congress, and civic
organizations to prosecute actions involving the constitutionality or validity of laws, regulations
and rulings."24 The fairly recent Chavez v. Gonzales25 even permitted a non-member of the broast
media, who failed to allege a personal stake in the outcome of the controversy, to challenge the
acts of the Secretary of Justice and the National Telecommunications Commission. The majority,
in the said case, echoed the current policy that "this Court has repeatedly and consistently
refused to wield procedural barriers as impediments to its addressing and resolving serious legal
questions that greatly impact on public interest, in keeping with the Court's duty under the 1987
Constitution to determine whether or not other branches of government have kept themselves
within the limits of the Constitution and the laws, and that they have not abused the discretion
given to them."26

In G.R. No. 170338, petitioner Garcillano justifies his standing to initiate the petition by alleging
that he is the person alluded to in the "Hello Garci" tapes. Further, his was publicly identified by
the members of the respondent committees as one of the voices in the recordings.27 Obviously,
therefore, petitioner Garcillano stands to be directly injured by the House committees' actions
and charges of electoral fraud. The Court recognizes his standing to institute the petition for
prohibition.

In G.R. No. 179275, petitioners Ranada and Agcaoili justify their standing by alleging that they
are concerned citizens, taxpayers, and members of the IBP. They are of the firm conviction that
any attempt to use the "Hello Garci" tapes will further divide the country. They wish to see the
legal and proper use of public funds that will necessarily be defrayed in the ensuing public
hearings. They are worried by the continuous violation of the laws and individual rights, and the
blatant attempt to abuse constitutional processes through the conduct of legislative inquiries
purportedly in aid of legislation.28

Intervenor Sagge alleges violation of his right to due process considering that he is summoned to
attend the Senate hearings without being apprised not only of his rights therein through the
publication of the Senate Rules of Procedure Governing Inquiries in Aid of Legislation, but also
of the intended legislation which underpins the investigation. He further intervenes as a taxpayer
bewailing the useless and wasteful expenditure of public funds involved in the conduct of the
questioned hearings.29

Given that petitioners Ranada and Agcaoili allege an interest in the execution of the laws and
that intervenor Sagge asserts his constitutional right to due process,30 they satisfy the requisite
personal stake in the outcome of the controversy by merely being citizens of the Republic.

Following the Court's ruling in Francisco, Jr. v. The House of Representatives,31 we find
sufficient petitioners Ranada's and Agcaoili's and intervenor Sagge's allegation that the
continuous conduct by the Senate of the questioned legislative inquiry will necessarily involve
the expenditure of public funds.32 It should be noted that in Francisco, rights personal to then
Chief Justice Hilario G. Davide, Jr. had been injured by the alleged unconstitutional acts of the
House of Representatives, yet the Court granted standing to the petitioners therein for, as in this
case, they invariably invoked the vindication of their own rights–as taxpayers, members of
Congress, citizens, individually or in a class suit, and members of the bar and of the legal
profession–which were also supposedly violated by the therein assailed unconstitutional acts.33

Likewise, a reading of the petition in G.R. No. 179275 shows that the petitioners and intervenor
Sagge advance constitutional issues which deserve the attention of this Court in view of their
seriousness, novelty and weight as precedents. The issues are of transcendental and paramount
importance not only to the public but also to the Bench and the Bar, and should be resolved for
the guidance of all.34

Thus, in the exercise of its sound discretion and given the liberal attitude it has shown in prior
cases climaxing in the more recent case of Chavez, the Court recognizes the legal standing of
petitioners Ranada and Agcaoili and intervenor Sagge.

- II -

The Court, however, dismisses G.R. No. 170338 for being moot and academic. Repeatedly
stressed in our prior decisions is the principle that the exercise by this Court of judicial power is
limited to the determination and resolution of actual cases and controversies.35 By actual cases,
we mean existing conflicts appropriate or ripe for judicial determination, not conjectural or
anticipatory, for otherwise the decision of the Court will amount to an advisory opinion. The
power of judicial inquiry does not extend to hypothetical questions because any attempt at
abstraction could only lead to dialectics and barren legal questions and to sterile conclusions
unrelated to actualities.36 Neither will the Court determine a moot question in a case in which no
practical relief can be granted. A case becomes moot when its purpose has become stale.37 It is
unnecessary to indulge in academic discussion of a case presenting a moot question as a
judgment thereon cannot have any practical legal effect or, in the nature of things, cannot be
enforced.38

In G.R. No. 170338, petitioner Garcillano implores from the Court, as aforementioned, the
issuance of an injunctive writ to prohibit the respondent House Committees from playing the
tape recordings and from including the same in their committee report. He likewise prays that the
said tapes be stricken off the records of the House proceedings. But the Court notes that the
recordings were already played in the House and heard by its members.39 There is also the widely
publicized fact that the committee reports on the "Hello Garci" inquiry were completed and
submitted to the House in plenary by the respondent committees.40 Having been overtaken by
these events, the Garcillano petition has to be dismissed for being moot and academic. After all,
prohibition is a preventive remedy to restrain the doing of an act about to be done, and not
intended to provide a remedy for an act already accomplished.41

- III -

As to the petition in G.R. No. 179275, the Court grants the same. The Senate cannot be allowed
to continue with the conduct of the questioned legislative inquiry without duly published rules of
procedure, in clear derogation of the constitutional requirement.

Section 21, Article VI of the 1987 Constitution explicitly provides that "[t]he Senate or the
House of Representatives, or any of its respective committees may conduct inquiries in aid of
legislation in accordance with its duly published rules of procedure." The requisite of
publication of the rules is intended to satisfy the basic requirements of due process.42 Publication
is indeed imperative, for it will be the height of injustice to punish or otherwise burden a citizen
for the transgression of a law or rule of which he had no notice whatsoever, not even a
constructive one.43 What constitutes publication is set forth in Article 2 of the Civil Code, which
provides that "[l]aws shall take effect after 15 days following the completion of their publication
either in the Official Gazette, or in a newspaper of general circulation in the Philippines."44

The respondents in G.R. No. 179275 admit in their pleadings and even on oral argument that the
Senate Rules of Procedure Governing Inquiries in Aid of Legislation had been published in
newspapers of general circulation only in 1995 and in 2006.45 With respect to the present Senate
of the 14th Congress, however, of which the term of half of its members commenced on June 30,
2007, no effort was undertaken for the publication of these rules when they first opened their
session.
Recently, the Court had occasion to rule on this very same question. In Neri v. Senate Committee
on Accountability of Public Officers and Investigations,46 we said:

Fourth, we find merit in the argument of the OSG that respondent Committees likewise violated
Section 21 of Article VI of the Constitution, requiring that the inquiry be in accordance with the
"duly published rules of procedure." We quote the OSG's explanation:

The phrase "duly published rules of procedure" requires the Senate of every Congress to publish
its rules of procedure governing inquiries in aid of legislation because every Senate is distinct
from the one before it or after it. Since Senatorial elections are held every three (3) years for one-
half of the Senate's membership, the composition of the Senate also changes by the end of each
term. Each Senate may thus enact a different set of rules as it may deem fit. Not having
published its Rules of Procedure, the subject hearings in aid of legislation conducted by the
14th Senate, are therefore, procedurally infirm.

Justice Antonio T. Carpio, in his Dissenting and Concurring Opinion, reinforces this ruling with
the following rationalization:

The present Senate under the 1987 Constitution is no longer a continuing legislative body. The
present Senate has twenty-four members, twelve of whom are elected every three years for a
term of six years each. Thus, the term of twelve Senators expires every three years, leaving less
than a majority of Senators to continue into the next Congress. The 1987 Constitution, like
the 1935 Constitution, requires a majority of Senators to "constitute a quorum to do business."
Applying the same reasoning in Arnault v. Nazareno, the Senate under the 1987 Constitution is
not a continuing body because less than majority of the Senators continue into the next Congress.
The consequence is that the Rules of Procedure must be republished by the Senate after every
expiry of the term of twelve Senators.47

The subject was explained with greater lucidity in our Resolution48 (On the Motion for
Reconsideration) in the same case, viz.:

On the nature of the Senate as a "continuing body," this Court sees fit to issue a clarification.
Certainly, there is no debate that the Senate as an institution is "continuing," as it is not
dissolved as an entity with each national election or change in the composition of its members.
However, in the conduct of its day-to-day business the Senate of each Congress acts separately
and independently of the Senate of the Congress before it. The Rules of the Senate itself
confirms this when it states:

RULE XLIV
UNFINISHED BUSINESS

SEC. 123. Unfinished business at the end of the session shall be taken up at the next session in
the same status.

All pending matters and proceedings shall terminate upon the expiration of one (1)
Congress, but may be taken by the succeeding Congress as if present for the first time.
Undeniably from the foregoing, all pending matters and proceedings, i.e., unpassed bills and
even legislative investigations, of the Senate of a particular Congress are considered terminated
upon the expiration of that Congress and it is merely optional on the Senate of the succeeding
Congress to take up such unfinished matters, not in the same status, but as if presented for the
first time. The logic and practicality of such a rule is readily apparent considering that the
Senate of the succeeding Congress (which will typically have a different composition as that of
the previous Congress) should not be bound by the acts and deliberations of the Senate of which
they had no part. If the Senate is a continuing body even with respect to the conduct of its
business, then pending matters will not be deemed terminated with the expiration of one
Congress but will, as a matter of course, continue into the next Congress with the same status.

This dichotomy of the continuity of the Senate as an institution and of the opposite nature of the
conduct of its business is reflected in its Rules. The Rules of the Senate (i.e. the Senate's main
rules of procedure) states:

RULE LI
AMENDMENTS TO, OR REVISIONS OF, THE RULES

SEC. 136. At the start of each session in which the Senators elected in the preceding elections
shall begin their term of office, the President may endorse the Rules to the appropriate committee
for amendment or revision.

The Rules may also be amended by means of a motion which should be presented at least one
day before its consideration, and the vote of the majority of the Senators present in the session
shall be required for its approval.

RULE LII
DATE OF TAKING EFFECT

SEC. 137. These Rules shall take effect on the date of their adoption and shall remain in force
until they are amended or repealed.

Section 136 of the Senate Rules quoted above takes into account the new composition of the
Senate after an election and the possibility of the amendment or revision of the Rules at the start
of each session in which the newly elected Senators shall begin their term.

However, it is evident that the Senate has determined that its main rules are intended to be valid
from the date of their adoption until they are amended or repealed. Such language is
conspicuously absent from the Rules. The Rules simply state "(t)hese Rules shall take effect
seven (7) days after publication in two (2) newspapers of general circulation." The latter does not
explicitly provide for the continued effectivity of such rules until they are amended or repealed.
In view of the difference in the language of the two sets of Senate rules, it cannot be presumed
that the Rules (on legislative inquiries) would continue into the next Congress. The Senate of the
next Congress may easily adopt different rules for its legislative inquiries which come within the
rule on unfinished business.
The language of Section 21, Article VI of the Constitution requiring that the inquiry be
conducted in accordance with the duly published rules of procedure is categorical. It is
incumbent upon the Senate to publish the rules for its legislative inquiries in each Congress or
otherwise make the published rules clearly state that the same shall be effective in subsequent
Congresses or until they are amended or repealed to sufficiently put public on notice.

If it was the intention of the Senate for its present rules on legislative inquiries to be effective
even in the next Congress, it could have easily adopted the same language it had used in its main
rules regarding effectivity.

Respondents justify their non-observance of the constitutionally mandated publication by

arguing that the rules have never been amended since 1995 and, despite that, they are published
in booklet form available to anyone for free, and accessible to the public at the Senate's internet
web page.49

The Court does not agree. The absence of any amendment to the rules cannot justify the Senate's
defiance of the clear and unambiguous language of Section 21, Article VI of the Constitution.
The organic law instructs, without more, that the Senate or its committees may conduct inquiries
in aid of legislation only in accordance with duly published rules of procedure, and does not
make any distinction whether or not these rules have undergone amendments or revision. The
constitutional mandate to publish the said rules prevails over any custom, practice or tradition
followed by the Senate.

Justice Carpio's response to the same argument raised by the respondents is illuminating:

The publication of the Rules of Procedure in the website of the Senate, or in pamphlet form
available at the Senate, is not sufficient under the Tañada v. Tuvera ruling which requires
publication either in the Official Gazette or in a newspaper of general circulation. The Rules of
Procedure even provide that the rules "shall take effect seven (7) days after publication in two
(2) newspapers of general circulation," precluding any other form of publication. Publication in
accordance with Tañada is mandatory to comply with the due process requirement because the
Rules of Procedure put a person's liberty at risk. A person who violates the Rules of Procedure
could be arrested and detained by the Senate.

The invocation by the respondents of the provisions of R.A. No. 8792,50 otherwise known as the
Electronic Commerce Act of 2000, to support their claim of valid publication through the
internet is all the more incorrect. R.A. 8792 considers an electronic data message or an electronic
document as the functional equivalent of a written document only for evidentiary purposes.51 In
other words, the law merely recognizes the admissibility in evidence (for their being the original)
of electronic data messages and/or electronic documents.52 It does not make the internet a
medium for publishing laws, rules and regulations.

Given this discussion, the respondent Senate Committees, therefore, could not, in violation of the
Constitution, use its unpublished rules in the legislative inquiry subject of these consolidated
cases. The conduct of inquiries in aid of legislation by the Senate has to be deferred until it shall
have caused the publication of the rules, because it can do so only "in accordance with its duly
published rules of procedure."

Very recently, the Senate caused the publication of the Senate Rules of Procedure Governing
Inquiries in Aid of Legislation in the October 31, 2008 issues of Manila Bulletin and Malaya.
While we take judicial notice of this fact, the recent publication does not cure the infirmity of the
inquiry sought to be prohibited by the instant petitions. Insofar as the consolidated cases are
concerned, the legislative investigation subject thereof still could not be undertaken by the
respondent Senate Committees, because no published rules governed it, in clear contravention of
the Constitution.

With the foregoing disquisition, the Court finds it unnecessary to discuss the other issues raised
in the consolidated petitions.

WHEREFORE, the petition in G.R. No. 170338 is DISMISSED, and the petition in G.R. No.
179275 is GRANTED. Let a writ of prohibition be issued enjoining the Senate of the Republic of
the Philippines and/or any of its committees from conducting any inquiry in aid of legislation
centered on the "Hello Garci" tapes.

SO ORDERED.
 [G.R. NO. 178830 : July 14, 2008]

ROLEX SUPLICO, Petitioner, v. NATIONAL ECONOMIC AND DEVELOPMENT

AUTHORITY, represented by NEDA SECRETARY ROMULO L. NERI, and the NEDA-
INVESTMENT COORDINATION COMMITTEE, DEPARTMENT OF
TRANSPORTATION AND COMMUNICATIONS (DOTC), represented by DOTC
SECRETARY LEANDRO MENDOZA, including the COMMISSION ON
INFORMATION AND COMMUNICATIONS TECHNOLOGY, headed by its Chairman,
RAMON P. SALES, THE TELECOMMUNICATIONS OFFICE, BIDS AND AWARDS
FOR INFORMATION AND COMMUNICATIONS TECHNOLOGY (ICT), headed by
DOTC ASSISTANT SECRETARY ELMER A. SONEJA as Chairman, and the
TECHNICAL WORKING GROUP FOR ICT, AND DOTC ASSISTANT SECRETARY
LORENZO FORMOSO, AND ALL OTHER OPERATING UNITS OF THE DOTC FOR
INFORMATION AND COMMUNICATIONS TECHNOLOGY, and ZTE
CORPORATION, AMSTERDAM HOLDINGS, INC., AND ALL PERSONS ACTING IN
THEIR BEHALF, Respondents.

RESOLUTION

REYES, R.T., J.:

Under consideration is the Manifestation and Motion1 dated October 26, 2007 of the Office of
the Solicitor General (OSG) which states:

The Office of the Solicitor General (OSG) respectfully avers that in an Indorsement dated
October 24, 2007, the Legal Service of the Department of Transportation and Communications
(DOTC) has informed it of the Philippine Government's decision not to continue with the ZTE
National Broadband Network Project (see attachment2 ). That said, there is no more justiciable
controversy for this Honorable Court to resolve. WHEREFORE, public respondents respectfully
pray that the present petitions be DISMISSED.

On November 13, 2007, the Court noted the OSG's manifestation and motion and required
petitioners in G.R. NOS. 178830, 179317, and 179613 to comment.

On December 6, 2007, Rolex Suplico, petitioner in G.R. No. 178830, filed his Consolidated
Reply and Opposition,3 opposing the aforequoted OSG Manifestation and Motion, arguing that:

66. Aside from the fact that the Notes of the Meeting Between President Gloria Macapagal-
Arroyo and Chinese President Hu Jintao held 2 October 2007 were not attached to the 26
October 2007 Manifestation and Motion - thus depriving petitioners of the opportunity to
comment thereon - a mere verbally requested 1st Indorsement is not sufficient basis for the
conclusion that the ZTE-DOTC NBN deal has been permanently scrapped.
67. Suffice to state, said 1st Indorsement is glaringly self-serving, especially without the Notes of
the Meeting Between President Gloria Macapagal-Arroyo and Chinese President Hu Jintao to
support its allegations or other proof of the supposed decision to cancel the ZTE-DOTC NBN
deal. Public respondents can certainly do better than that.4

Petitioner Suplico further argues that:

79. Assuming arguendo that some aspects of the present Petition have been rendered moot
(which is vehemently denied), this Honorable Court, consistent with well-entrenched
jurisprudence, may still take cognizance thereof.5

Petitioner Suplico cites this Court's rulings in Gonzales v. Chavez,6 Rufino v. Endriga,7 and
Alunan III v. Mirasol8 that despite their mootness, the Court nevertheless took cognizance of
these cases and ruled on the merits due to the Court's symbolic function of educating the bench
and the bar by formulating guiding and controlling principles, precepts, doctrines, and rules.

On January 31, 2008, Amsterdam Holdings, Inc. (AHI) and Nathaniel Sauz, petitioners in G.R.
No. 179317, also filed their comment expressing their sentiments, thus:

3. First of all, the present administration has never been known for candor. The present
administration has a very nasty habit of not keeping its word. It says one thing, but does another.

4. This being the case, herein petitioners are unable to bring themselves to feel even a bit
reassured that the government, in the event that the above-captioned cases are dismissed, will not
backtrack, re-transact, or even resurrect the now infamous NBN-ZTE transaction. This is
especially relevant since what was attached to the OSG's Manifestation and Motion was a mere
one (1) page written communication sent by the Department of Transportation and
Communications (DOTC) to the OSG, allegedly relaying that the Philippine Government has
decided not to continue with the NBN project "x x x due to several reasons and constraints."

Petitioners AHI and Sauz further contend that because of the transcendental importance of the
issues raised in the petition, which among others, included the President's use of the power to
borrow, i.e., to enter into foreign loan agreements, this Court should take cognizance of this case
despite its apparent mootness.

On January 15, 2008, the Court required the OSG to file respondents' reply to petitioners'
comments on its manifestation and motion.

On April 18, 2008, the OSG filed respondents' reply, reiterating their position that for a court to
exercise its power of adjudication, there must be an actual case or controversy - one which
involves a conflict of legal rights, an assertion of opposite legal claims susceptible of judicial
resolution; the case must not be moot or academic or based on extra-legal or other similar
considerations not cognizable by a court of justice.9

Respondents also insist that there is no perfected contract in this case that would prejudice the
government or public interest. Explaining the nature of the NBN Project as an executive
agreement, respondents stress that it remained in the negotiation stage. The conditions
precedent10 for the agreement to become effective have not yet been complied with.

Respondents further oppose petitioners' claim of the right to information, which they contend is
not an absolute right. They contend that the matters raised concern executive policy, a political
question which the judicial branch of government would generally hesitate to pass upon.

On July 2, 2008, the OSG filed a Supplemental Manifestation and Motion. Appended to it is the
Highlights from the Notes of Meeting between President Gloria Macapagal-Arroyo and Chinese
President Hu Jintao, held in XI Jiao Guesthouse, Shanghai, China, on October 2, 2007. In the
Notes of Meeting, the Philippine Government conveyed its decision not to continue with the
ZTE National Broadband Network Project due to several constraints. The same Notes likewise
contained President Hu Jintao's expression of understanding of the Philippine Government
decision.

We resolve to grant the motion.

Firstly, the Court notes the triple petitions to be for certiorari, prohibition and mandamus, with
application for the issuance of a Temporary Restraining Order (TRO) and/or Preliminary
Injunction. The individual prayers in each of the three (3) consolidated petitions are:

G.R. No. 178830

WHEREFORE, it is respectfully prayed of this Honorable Court:

1. Upon the filing of this Petition, pursuant to the second paragraph of Rule 58, Section 5 of the
Rules of Court, issue forthwith an ex parte temporary restraining order enjoining respondents,
their subordinates, agents, representatives and any and all persons acting on their behalf from
pursuing, entering into indebtedness, disbursing funds, and implementing the ZTE-DOTC
Broadband Deal;

2. Compel respondents, upon Writ of Mandamus, to forthwith produce and furnish petitioner or
his undersigned counsel a certified true copy of the contract or agreement covering the NBN
project as agreed upon with ZTE Corporation;

3. Schedule Oral Arguments in the present case pursuant to Rule 49 in relation to Section 2, Rule
56 of the revised Rules of Court; and,

4. Annul and set aside the award of the ZTE-DOTC Broadband Deal, and compel public
respondents to forthwith comply with pertinent provisions of law regarding procurement of
government ICT contracts and public bidding for the NBN contract.11 (Emphasis supplied) cralawlibrary

G.R. No. 179317

WHEREFORE, petitioners Amsterdam Holdings, Inc., and Nathaniel Sauz respectfully pray as
follows:
A. upon the filing of this Petition for Mandamus and conditioned upon the posting of a bond in
such amount as the Honorable Court may fix, a temporary restraining order and/or writ of
preliminary injunction be issued directing the Department of Transportation and
Communication, the Commission on Information and Communications Technology, all other
government agencies and instrumentalities, their officers, employees, and/or other persons acting
for and on their behalf to desist during the pendency of the instant Petition for Mandamus from
entering into any other agreements and from commencing with any kind, sort, or specie of
activity in connection with the National Broadband Network Project;

B. the instant Petition for Mandamus be given due course; and,

C. after due consideration of all relevant issues, judgment be rendered directing respondents to
allow herein petitioners access to all agreements entered into with the Government of China, the
ZTE Corporation, and/or other entities, government instrumentalities, and/or individuals with
regard to the National Broadband Network Project.12 (Emphasis supplied) cralawlibrary

G.R. No. 179613

WHEREFORE, it is respectfully prayed of this Honorable Court to:

1. Compel respondents, upon Writ of Mandamus, to forthwith produce and furnish petitioner or
his undersigned counsel a certified true copy of the contract or agreement covering the NBN
project as agreed upon with ZTE Corporation;

2. Schedule Oral Arguments in the present case pursuant to Rule 49 in relation to Section 2, Rule
56 of the Revised Rules of Court;

3. Annul and set aside the award of the contract for the national broadband network to
respondent ZTE Corporation, upon the ground that said contract, as well as the procedures
resorted to preparatory to the execution thereof, is contrary to the Constitution, to law and to
public policy;

4. Compel public respondent to forthwith comply with pertinent provisions of law regarding
procurement of government infrastructure projects, including public bidding for said contract to
undertake the construction of the national broadband network.13 (Emphasis supplied) cralawlibrary

On September 11, 2007, the Court issued a TRO14 in G.R. No. 178830, enjoining the parties
from "pursuing, entering into indebtedness, disbursing funds, and implementing the ZTE-DOTC
Broadband Deal and Project" as prayed for. Pertinent parts of the said Order read:

WHEREAS, the Supreme Court, on 11 September 2007, adopted a resolution in the above-
entitled case, to wit:

"G.R. No. 178830 (Rolex Suplico v. National Economic and Development Authority,
represented by NEDA Secretary Romulo L. Neri, and the NEDA Investment Coordination
Committee, Department of Transportation and Communications (DOTC), represented by DOTC
Secretary Leandro Mendoza, including the Commission on Information and Communications
Technology, headed by its Chairman, Ramon P. Sales, The Telecommunications Office, Bids
and Awards for Information and Communications Technology Committee (ICT), headed by
DOTC Assistant Secretary Elmer A. Soneja as Chairman, and The Technical Working Group for
ICT, and DOTC Assistant Secretary Lorenzo Formoso, and All Other Operating Units of the
DOTC for Information and Communications Technology, and ZTE Corporation, Amsterdam
Holdings, Inc., and ARESCOM, Inc. Acting on the instant petition with prayer for temporary
restraining order and/or writ of preliminary injunction, the Court Resolved, without giving due
course to the petition, to

x    x    x

(d) Issue a TEMPORARY RESTRAINING ORDER, effective immediately and continuing until
further orders from this Court, enjoining the (i) National Economic and Development Authority,
(ii) NEDA-Investment Coordination Committee, (iii) Department of Transportation and
Communications, Commission on Information and Communications Technology, (iv)
Telecommunications Office, Bids and Awards for Information and Communications Technology
Committee (ICT), (v) Technical Working Group for ICT, and all other Operating Units of the
DOTC for Information and Communications Technology, (vi) ZTE Corporation; (vii)
Amsterdam Holdings, Inc., and (viii) ARESCOM, Inc., and any and all persons acting on their
behalf from 'pursuing, entering into indebtedness, disbursing funds, and implementing the ZTE-
DOTC Broadband Deal and Project' as prayed for."

NOW THEREFORE, effective immediately and continuing until further orders from this Court,
You, Respondents (i) National Economic and Development Authority, (ii) NEDA-Investment
Coordination Committee, (iii) Department of Transportation and Communications, Commission
on Information and Communications Technology, (iv) Telecommunications Office, Bids and
Awards for Information and Communications Technology Committee (ICT), (v) Technical
Working Group for ICT, and all other Operating Units of the DOTC for Information and
Communications Technology, (vi) ZTE Corporation; (vii) Amsterdam Holdings, Inc., and (viii)
ARESCOM, Inc., and any and all persons acting on their behalf are hereby ENJOINED from
"pursuing, entering into indebtedness, disbursing funds, and implementing the ZTE-DOTC
Broadband Deal and Project" as prayed for.15 (Emphasis supplied.)

Petitioners in G.R. NOS. 178830 and 179613 pray that they be furnished certified true copies of
the "contract or agreement covering the NBN project as agreed upon with ZTE Corporation." It
appears that during one of the Senate hearings on the NBN project, copies of the supply
contract16 were readily made available to petitioners.17 Evidently, the said prayer has been
complied with and is, thus, mooted.

When President Gloria Macapagal-Arroyo, acting in her official capacity during the meeting
held on October 2, 2007 in China, informed China's President Hu Jintao that the Philippine
Government had decided not to continue with the ZTE-National Broadband Network (ZTE-
NBN) Project due to several reasons and constraints, there is no doubt that all the other principal
prayers in the three petitions (to annul, set aside, and enjoin the implementation of the ZTE-NBN
Project) had also become moot.
Contrary to petitioners' contentions that these declarations made by officials belonging to the
executive branch on the Philippine Government's decision not to continue with the ZTE-NBN
Project are self-serving, hence, inadmissible, the Court has no alternative but to take judicial
notice of this official act of the President of the Philippines.

Section 1, Rule 129 of the Rules of Court provides:

SECTION 1. Judicial Notice, when mandatory. - A court shall take judicial notice, without
introduction of evidence, of the existence and territorial extent of states, their political history,
forms of government and symbols of nationality, the law of nations, the admiralty and maritime
courts of the world and their seals, the political constitution and history of the Philippines, the
official acts of the legislative, executive and judicial departments of the Philippines, the laws of
nature, the measure of time, and the geographical divisions. (Emphasis supplied) cralawlibrary

Under the rules, it is mandatory and the Court has no alternative but to take judicial notice of the
official acts of the President of the Philippines, who heads the executive branch of our
government. It is further provided in the above-quoted rule that the court shall take judicial
notice of the foregoing facts without introduction of evidence. Since we consider the act of
cancellation by President Macapagal-Arroyo of the proposed ZTE-NBN Project during the
meeting of October 2, 2007 with the Chinese President in China as an official act of the
executive department, the Court must take judicial notice of such official act without need of
evidence.

In David v. Macapagal-Arroyo,18 We took judicial notice of the announcement by the Office of

the President banning all rallies and canceling all permits for public assemblies following the
issuance of Presidential Proclamation No. 1017 and General Order No. 5.

In Estrada v. Desierto,19 the Court also resorted to judicial notice in resolving the factual
ingredient of the petition.

Moreover, under Section 2, paragraph (m) of Rule 131 of the Rules of Court, the official duty of
the executive officials20 of informing this Court of the government's decision not to continue with
the ZTE-NBN Project is also presumed to have been regularly performed, absent proof to the
contrary. Other than petitioner AHI's unsavory insinuation in its comment, the Court finds no
factual or legal basis to disregard this disputable presumption in the present instance.

Concomitant to its fundamental task as the ultimate citadel of justice and legitimacy is the
judiciary's role of strengthening political stability indispensable to progress and national
development. Pontificating on issues which no longer legitimately constitute an actual case or
controversy will do more harm than good to the nation as a whole. Wise exercise of judicial
discretion militates against resolving the academic issues, as petitioners want this Court to do.
This is especially true where, as will be further discussed, the legal issues raised cannot be
resolved without previously establishing the factual basis or antecedents.

Judicial power presupposes actual controversies, the very antithesis of mootness. In the absence
of actual justiciable controversies or disputes, the Court generally opts to refrain from deciding
moot issues. Where there is no more live subject of controversy, the Court ceases to have a
reason to render any ruling or make any pronouncement.

Kapag wala nang buhay na kaso, wala nang dahilan para magdesisyon ang Husgado.

In Republic Telecommunications Holdings, Inc. v. Santiago,21 the lone issue tackled by the Court
of Appeals (CA) was whether the Securities Investigation and Clearing Department (SICD) and
Securities and Exchange Commission (SEC) en banc committed reversible error in issuing and
upholding, respectively, the writ of preliminary injunction. The writ enjoined the execution of
the questioned agreements between Qualcomm, Inc. and Republic Telecommunications
Holdings, Inc. (RETELCOM). The implementation of the agreements was restrained through the
assailed orders of the SICD and the SEC en banc which, however, were nullified by the CA
decision. Thus, RETELCOM elevated the matter to this Court praying for the reinstatement of
the writ of preliminary injunction of the SICD and the SEC en banc. However, before the matter
was finally resolved, Qualcomm, Inc. withdrew from the negotiating table. Its withdrawal had
thwarted the execution and enforcement of the contracts. Thus, the resolution of whether the
implementation of said agreements should be enjoined became no longer necessary.

Equally applicable to the present case is the Court ruling in the above-cited Republic
Telecommunications. There We held, thus:

Indeed, the instant petition, insofar as it assails the Court of Appeals' Decision nullifying the
orders of the SEC en banc and the SICD, has been rendered moot and academic. To rule, one
way or the other, on the correctness of the questioned orders of the SEC en banc and the SICD
will be indulging in a theoretical exercise that has no practical worth in view of the supervening
event.

The rule is well-settled that for a court to exercise its power of adjudication, there must be an
actual case or controversy - one which involves a conflict of legal rights, an assertion of opposite
legal claims susceptible of judicial resolution; the case must not be moot or academic or based on
extra-legal or other similar considerations not cognizable by a court of justice. Where the issue
has become moot and academic, there is no justiciable controversy, and an adjudication thereon
would be of no practical use or value as courts do not sit to adjudicate mere academic questions
to satisfy scholarly interest, however intellectually challenging.

In the ultimate analysis, petitioners are seeking the reinstatement of the writ of injunction to
prevent the concerned parties from pushing through with transactions with Qualcomm, Inc.
Given that Qualcomm, Inc. is no longer interested in pursuing the contracts, there is no actual
substantial relief to which petitioners would be entitled and which would be negated by the
dismissal of the petition.

The Court likewise finds it unnecessary to rule whether the assailed Court of Appeals' Decision
had the effect of overruling the Court's Resolution dated 29 January 1999, which set aside the
TRO issued by the appellate court.
A ruling on the matter practically partakes of a mere advisory opinion, which falls beyond the
realm of judicial review. The exercise of the power of judicial review is limited to actual cases
and controversies. Courts have no authority to pass upon issues through advisory opinions or to
resolve hypothetical or feigned problems.

While there were occasions when the Court passed upon issues although supervening events had
rendered those petitions moot and academic, the instant case does not fall under the exceptional
cases. In those cases, the Court was persuaded to resolve moot and academic issues to formulate
guiding and controlling constitutional principles, precepts, doctrines or rules for future guidance
of both bench and bar.

In the case at bar, the resolution of whether a writ of preliminary injunction may be issued to
prevent the implementation of the assailed contracts calls for an appraisal of factual
considerations which are peculiar only to the transactions and parties involved in this
controversy. Except for the determination of whether petitioners are entitled to a writ of
preliminary injunction which is now moot, the issues raised in this petition do not call for a
clarification of any constitutional principle or the interpretation of any statutory provision.22

Secondly, even assuming that the Court will choose to disregard the foregoing considerations
and brush aside mootness, the Court cannot completely rule on the merits of the case because the
resolution of the three petitions involves settling factual issues which definitely requires
reception of evidence. There is not an iota of doubt that this may not be done by this Court in the
first instance because, as has been stated often enough, this Court is not a trier of facts.

Ang pagpapasiya sa tatlong petisyon ay nangangailangan ng paglilitis na hindi gawain ng

Hukumang ito.

Respondent ZTE, in its Comment in G.R. No. 178830,23 correctly pointed out that since
petitioner Suplico filed his petition directly with this Court, without prior factual findings made
by any lower court, a determination of pertinent and relevant facts is needed. ZTE enumerated
some of these factual issues, to wit:

(1) Whether an executive agreement has been reached between the Philippine and Chinese
governments over the NBN Project;

(2) Whether the ZTE Supply Contract was entered into by the Republic of the Philippines,
through the DOTC, and ZTE International pursuant to, and as an integral part of, the executive
agreement;

(3) Whether a loan agreement for the NBN Project has actually been executed;

(4) Whether the Philippine government required that the NBN Project be completed under a
Build-Operate-and-Transfer Scheme;

(5) Whether the AHI proposal complied with the requirements for an unsolicited proposal under
the BOT Law;
(6) Whether the Philippine government has actually earmarked public finds for disbursement
under the ZTE Supply Contract; and cralawlibrary

(7) Whether the coverage of the NBN Project to be supplied under the ZTE Supply Contract is
more extensive than that under the AHI proposal or such other proposal submitted therefor.24

Definitely, some very specific reliefs prayed for in both G.R. NOS. 178830 and 179613 require
prior determination of facts before pertinent legal issues could be resolved and specific reliefs
granted.

In G.R. No. 178830, petitioner seeks to annul and set aside the award of the ZTE-DOTC
Broadband Deal and compel public respondents to forthwith comply with pertinent provisions of
law regarding procurement of government ICT contracts and public bidding for the NBN
contract.

In G.R. No. 179613, petitioners also pray that the Court annul and set aside the award of the
contract for the national broadband network to respondent ZTE Corporation, upon the ground
that said contract, as well as the procedures resorted to preparatory to the execution thereof, is
contrary to the Constitution, to law and to public policy. They also ask the Court to compel
public respondent to forthwith comply with pertinent provisions of law regarding procurement of
government infrastructure projects, including public bidding for said contract to undertake the
construction of the national broadband network.

It is simply impossible for this Court "to annul and set aside the award of the ZTE-DOTC
Broadband Deal" without any evidence to support a prior factual finding pointing to any
violation of law that could lead to such annulment order. For sure, the Supreme Court is not the
proper venue for this factual matter to be threshed out.

Thirdly, petitioner Suplico in G.R. No. 178830 prayed that this Court order "public respondents
to forthwith comply with pertinent provisions of law regarding procurement of government ICT
contracts and public bidding for the NBN contract."25 It would be too presumptuous on the part
of the Court to summarily compel public respondents to comply with pertinent provisions of law
regarding procurement of government infrastructure projects without any factual basis or prior
determination of very particular violations committed by specific government officials of the
executive branch. For the Court to do so would amount to a breach of the norms of comity
among co-equal branches of government. A perceived error cannot be corrected by committing
another error. Without proper evidence, the Court cannot just presume that the executive did not
comply with procurement laws. Should the Court allow itself to fall into this trap, it would
plainly commit grave error itself.

Magiging kapangahasan sa Hukumang ito na pilitin ang mga pinipetisyon na tumalima sa batas
sa pangongontrata ng pamahalaan kung wala pang pagtitiyak o angkop na ebidensiya ng
nagawang paglabag dito.

Let it be clarified that the Senate investigation in aid of legislation cannot be the basis of Our
decision which requires a judicial finding of facts.
Justice Antonio T. Carpio takes the view that the National Broadband Network Project should be
declared null and void. The foregoing threefold reasons would suffice to address the concern of
Our esteemed colleague.

The Court is, therefore, constrained to dismiss the petitions and deny them due course because of
mootness and because their resolution requires reception of evidence which cannot be done in an
original petition brought before the Supreme Court.

WHEREFORE, the petitions are DISMISSED. The Temporary Restraining Order issued on
September 11, 2007 is DISSOLVED.

SO ORDERED.
 [G.R. NO. 170516 : July 16, 2008]

AKBAYAN CITIZENS ACTION PARTY ("AKBAYAN"), PAMBANSANG

KATIPUNAN NG MGA SAMAHAN SA KANAYUNAN ("PKSK"), ALLIANCE OF
PROGRESSIVE LABOR ("APL"), VICENTE A. FABE, ANGELITO R. MENDOZA,
MANUEL P. QUIAMBAO, ROSE BEATRIX CRUZ-ANGELES, CONG. LORENZO R.
TANADA III, CONG. MARIO JOYO AGUJA, CONG. LORETA ANN P. ROSALES,
CONG. ANA THERESIA HONTIVEROS-BARAQUEL, AND CONG. EMMANUEL
JOEL J. VILLANUEVA, Petitioners, v. THOMAS G. AQUINO, in his capacity as
Undersecretary of the Department of Trade and Industry (DTI) and Chairman and Chief
Delegate of the Philippine Coordinating Committee (PCC) for the Japan-Philippines
Economic Partnership Agreement, EDSEL T. CUSTODIO, in his capacity as
Undersecretary of the Department of Foreign Affairs (DFA) and Co-Chair of the PCC for
the JPEPA, EDGARDO ABON, in his capacity as Chairman of the Tariff Commission and
lead negotiator for Competition Policy and Emergency Measures of the JPEPA,
MARGARITA SONGCO, in her capacity as Assistant Director-General of the National
Economic Development Authority (NEDA) and lead negotiator for Trade in Services and
Cooperation of the JPEPA, MALOU MONTERO, in her capacity as Foreign Service
Officer I, Office of the Undersecretary for International Economic Relations of the DFA
and lead negotiator for the General and Final Provisions of the JPEPA, ERLINDA
ARCELLANA, in her capacity as Director of the Board of Investments and lead negotiator
for Trade in Goods (General Rules) of the JPEPA, RAQUEL ECHAGUE, in her capacity
as lead negotiator for Rules of Origin of the JPEPA, GALLANT SORIANO, in his official
capacity as Deputy Commissioner of the Bureau of Customs and lead negotiator for
Customs Procedures and Paperless Trading of the JPEPA, MA. LUISA GIGETTE
IMPERIAL, in her capacity as Director of the Bureau of Local Employment of the
Department of Labor and Employment (DOLE) and lead negotiator for Movement of
Natural Persons of the JPEPA, PASCUAL DE GUZMAN, in his capacity as Director of the
Board of Investments and lead negotiator for Investment of the JPEPA, JESUS
MOTOOMULL, in his capacity as Director for the Bureau of Product Standards of the
DTI and lead negotiator for Mutual Recognition of the JPEPA, LOUIE CALVARIO, in his
capacity as lead negotiator for Intellectual Property of the JPEPA, ELMER H. DORADO,
in his capacity as Officer-in-Charge of the Government Procurement Policy Board
Technical Support Office, the government agency that is leading the negotiations on
Government Procurement of the JPEPA, RICARDO V. PARAS, in his capacity as Chief
State Counsel of the Department of Justice (DOJ) and lead negotiator for Dispute
Avoidance and Settlement of the JPEPA, ADONIS SULIT, in his capacity as lead
negotiator for the General and Final Provisions of the JPEPA, EDUARDO R. ERMITA, in
his capacity as Executive Secretary, and ALBERTO ROMULO, in his capacity as
Secretary of the DFA,* Respondents.

DECISION

CARPIO MORALES, J.:

Petitioners - non-government organizations, Congresspersons, citizens and taxpayers - seek via
the present petition for mandamus and prohibition to obtain from respondents the full text of the
Japan-Philippines Economic Partnership Agreement (JPEPA) including the Philippine and
Japanese offers submitted during the negotiation process and all pertinent attachments and
annexes thereto.

Petitioners Congressmen Lorenzo R. Tañada III and Mario Joyo Aguja filed on January 25,
2005 House Resolution No. 551 calling for an inquiry into the bilateral trade agreements then
being negotiated by the Philippine government, particularly the JPEPA. The Resolution became
the basis of an inquiry subsequently conducted by the House Special Committee on
Globalization (the House Committee) into the negotiations of the JPEPA.

In the course of its inquiry, the House Committee requested herein respondent Undersecretary
Tomas Aquino (Usec. Aquino), Chairman of the Philippine Coordinating Committee created
under Executive Order No. 213 ("Creation of A Philippine Coordinating Committee to Study the
Feasibility of the Japan-Philippines Economic Partnership Agreement")1 to study and negotiate
the proposed JPEPA, and to furnish the Committee with a copy of the latest draft of the JPEPA.
Usec. Aquino did not heed the request, however.

Congressman Aguja later requested for the same document, but Usec. Aquino, by letter of
November 2, 2005, replied that the Congressman shall be provided with a copy thereof "once the
negotiations are completed and as soon as a thorough legal review of the proposed agreement has
been conducted."

In a separate move, the House Committee, through Congressman Herminio G. Teves, requested
Executive Secretary Eduardo Ermita to furnish it with "all documents on the subject including
the latest draft of the proposed agreement, the requests and offers etc."2 Acting on the request,
Secretary Ermita, by letter of June 23, 2005, wrote Congressman Teves as follows:

In its letter dated 15 June 2005 (copy enclosed), [the] D[epartment of] F[oreign] A[ffairs]
explains that the Committee's request to be furnished all documents on the JPEPA may be
difficult to accomplish at this time, since the proposed Agreement has been a work in
progress for about three years. A copy of the draft JPEPA will however be forwarded to the
Committee as soon as the text thereof is settled and complete. (Emphasis supplied) cralawlibrary

Congressman Aguja also requested NEDA Director-General Romulo Neri and Tariff
Commission Chairman Edgardo Abon, by letter of July 1, 2005, for copies of the latest text of
the JPEPA.
Chairman Abon replied, however, by letter of July 12, 2005 that the Tariff Commission does not
have a copy of the documents being requested, albeit he was certain that Usec. Aquino would
provide the Congressman with a copy "once the negotiation is completed." And by letter of July
18, 2005, NEDA Assistant Director-General Margarita R. Songco informed the Congressman
that his request addressed to Director-General Neri had been forwarded to Usec. Aquino who
would be "in the best position to respond" to the request.
In its third hearing conducted on August 31, 2005, the House Committee resolved to issue a
subpoena for the most recent draft of the JPEPA, but the same was not pursued because by
Committee Chairman Congressman Teves' information, then House Speaker Jose de Venecia had
requested him to hold in abeyance the issuance of the subpoena until the President gives her
consent to the disclosure of the documents.3

Amid speculations that the JPEPA might be signed by the Philippine government within
December 2005, the present petition was filed on December 9, 2005.4 The agreement was to be
later signed on September 9, 2006 by President Gloria Macapagal-Arroyo and Japanese Prime
Minister Junichiro Koizumi in Helsinki, Finland, following which the President endorsed it to
the Senate for its concurrence pursuant to Article VII, Section 21 of the Constitution. To date,
the JPEPA is still being deliberated upon by the Senate.

The JPEPA, which will be the first bilateral free trade agreement to be entered into by the
Philippines with another country in the event the Senate grants its consent to it, covers a broad
range of topics which respondents enumerate as follows: trade in goods, rules of origin, customs
procedures, paperless trading, trade in services, investment, intellectual property rights,
government procurement, movement of natural persons, cooperation, competition policy, mutual
recognition, dispute avoidance and settlement, improvement of the business environment, and
general and final provisions.5

While the final text of the JPEPA has now been made accessible to the public since September
11, 2006,6 respondents do not dispute that, at the time the petition was filed up to the filing of
petitioners' Reply - when the JPEPA was still being negotiated - the initial drafts thereof were
kept from public view.

Before delving on the substantive grounds relied upon by petitioners in support of the petition,
the Court finds it necessary to first resolve some material procedural issues.

Standing

For a petition for mandamus such as the one at bar to be given due course, it must be instituted
by a party aggrieved by the alleged inaction of any tribunal, corporation, board or person which
unlawfully excludes said party from the enjoyment of a legal right.7 Respondents deny that
petitioners have such standing to sue. "[I]n the interest of a speedy and definitive resolution of
the substantive issues raised," however, respondents consider it sufficient to cite a portion of the
ruling in Pimentel v. Office of Executive Secretary8 which emphasizes the need for a "personal
stake in the outcome of the controversy" on questions of standing.

In a petition anchored upon the right of the people to information on matters of public concern,
which is a public right by its very nature, petitioners need not show that they have any legal or
special interest in the result, it being sufficient to show that they are citizens and, therefore, part
of the general public which possesses the right.9 As the present petition is anchored on the right
to information and petitioners are all suing in their capacity as citizens and groups of citizens
including petitioners-members of the House of Representatives who additionally are suing in
their capacity as such, the standing of petitioners to file the present suit is grounded in
jurisprudence.

Mootness

Considering, however, that "[t]he principal relief petitioners are praying for is the disclosure of
the contents of the JPEPA prior to its finalization between the two States parties,"10 public
disclosure of the text of the JPEPA after its signing by the President, during the pendency of the
present petition, has been largely rendered moot and academic.

With the Senate deliberations on the JPEPA still pending, the agreement as it now stands cannot
yet be considered as final and binding between the two States. Article 164 of the JPEPA itself
provides that the agreement does not take effect immediately upon the signing thereof. For it
must still go through the procedures required by the laws of each country for its entry into force,
viz:

Article 164
Entry into Force

This Agreement shall enter into force on the thirtieth day after the date on which the
Governments of the Parties exchange diplomatic notes informing each other that their
respective legal procedures necessary for entry into force of this Agreement have been
completed. It shall remain in force unless terminated as provided for in Article 165.11 (Emphasis
supplied)cralawlibrary

President Arroyo's endorsement of the JPEPA to the Senate for concurrence is part of the legal
procedures which must be met prior to the agreement's entry into force.

The text of the JPEPA having then been made accessible to the public, the petition has become
moot and academic to the extent that it seeks the disclosure of the "full text" thereof.

The petition is not entirely moot, however, because petitioners seek to obtain, not merely the text
of the JPEPA, but also the Philippine and Japanese offers in the course of the negotiations.12

A discussion of the substantive issues, insofar as they impinge on petitioners' demand for access
to the Philippine and Japanese offers, is thus in order.

Grounds relied upon by petitioners

Petitioners assert, first, that the refusal of the government to disclose the documents bearing on
the JPEPA negotiations violates their right to information on matters of public concern13 and
contravenes other constitutional provisions on transparency, such as that on the policy of full
public disclosure of all transactions involving public interest.14 Second, they contend that non-
disclosure of the same documents undermines their right to effective and reasonable participation
in all levels of social, political, and economic decision-making.15 Lastly, they proffer that
divulging the contents of the JPEPA only after the agreement has been concluded will effectively
make the Senate into a mere rubber stamp of the Executive, in violation of the principle of
separation of powers.

Significantly, the grounds relied upon by petitioners for the disclosure of the latest text of the
JPEPA are, except for the last, the same as those cited for the disclosure of the Philippine and
Japanese offers.

The first two grounds relied upon by petitioners which bear on the merits of respondents' claim
of privilege shall be discussed. The last, being purely speculatory given that the Senate is still
deliberating on the JPEPA, shall not.

The JPEPA is a matter of public concern

To be covered by the right to information, the information sought must meet the threshold
requirement that it be a matter of public concern. Apropos is the teaching of Legaspi v. Civil
Service Commission:

In determining whether or not a particular information is of public concern there is no rigid test
which can be applied. 'Public concern' like 'public interest' is a term that eludes exact definition.
Both terms embrace a broad spectrum of subjects 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. In the final analysis, it is for the courts to determine on a case by
case basis whether the matter at issue is of interest or importance, as it relates to or affects the
public.16 (Underscoring supplied) cralawlibrary

From the nature of the JPEPA as an international trade agreement, it is evident that the
Philippine and Japanese offers submitted during the negotiations towards its execution are
matters of public concern. This, respondents do not dispute. They only claim that diplomatic
negotiations are covered by the doctrine of executive privilege, thus constituting an exception to
the right to information and the policy of full public disclosure.

Respondents' claim of privilege

It is well-established in jurisprudence that neither the right to information nor the policy of full
public disclosure is absolute, there being matters which, albeit of public concern or public
interest, are recognized as privileged in nature. The types of information which may be
considered privileged have been elucidated in Almonte v. Vasquez,17 Chavez v. PCGG,18 Chavez
v. Public Estate's Authority,19 and most recently in Senate v. Ermita20 where the Court reaffirmed
the validity of the doctrine of executive privilege in this jurisdiction and dwelt on its scope.

Whether a claim of executive privilege is valid depends on theground invoked to justify it and
thecontext in which it is made.21 In the present case, the ground for respondents' claim of
privilege is set forth in their Comment, viz:

x x x The categories of information that may be considered privileged includes matters of

diplomatic character and under negotiation and review. In this case, the privileged character of
the diplomatic negotiations has been categorically invoked and clearly explained by respondents
particularly respondent DTI Senior Undersecretary.

The documents on the proposed JPEPA as well as the text which is subject to negotiations and
legal review by the parties fall under the exceptions to the right of access to information on
matters of public concern and policy of public disclosure. They come within the coverage of
executive privilege. At the time when the Committee was requesting for copies of such
documents, the negotiations were ongoing as they are still now and the text of the proposed
JPEPA is still uncertain and subject to change. Considering the status and nature of such
documents then and now, these are evidently covered by executive privilege consistent with
existing legal provisions and settled jurisprudence.

Practical and strategic considerations likewise counsel against the disclosure of the "rolling
texts" which may undergo radical change or portions of which may be totally abandoned.
Furthermore, the negotiations of the representatives of the Philippines as well as of Japan
must be allowed to explore alternatives in the course of the negotiations in the same
manner as judicial deliberations and working drafts of opinions are accorded strict
confidentiality.22 (Emphasis and underscoring supplied) cralawlibrary

The ground relied upon by respondents is thus not simply that the information sought involves a
diplomatic matter, but that it pertains to diplomatic negotiations then in progress.

Privileged character of diplomatic negotiations

The privileged character of diplomatic negotiations has been recognized in this jurisdiction. In
discussing valid limitations on the right to information, the Court in Chavez v. PCGG held that
"information on inter-government exchanges prior to the conclusion of treaties and executive
agreements may be subject to reasonable safeguards for the sake of national interest."23 Even
earlier, the same privilege was upheld in People's Movement for Press Freedom (PMPF) v.
Manglapus24 wherein the Court discussed the reasons for the privilege in more precise terms.

In PMPF v. Manglapus, the therein petitioners were seeking information from the President's
representatives on the state of the then on-going negotiations of the RP-US Military Bases
Agreement.25 The Court denied the petition, stressing that "secrecy of negotiations with foreign
countries is not violative of the constitutional provisions of freedom of speech or of the press
nor of the freedom of access to information." The Resolution went on to state, thus:

The nature of diplomacy requires centralization of authority and expedition of decision

which are inherent in executive action. Another essential characteristic of diplomacy is its
confidential nature. Although much has been said about "open" and "secret" diplomacy, with
disparagement of the latter, Secretaries of State Hughes and Stimson have clearly analyzed and
justified the practice. In the words of Mr. Stimson:

"A complicated negotiation . . . cannot be carried through without many, many private
talks and discussion, man to man; many tentative suggestions and proposals. Delegates
from other countries come and tell you in confidence of their troubles at home and of their
differences with other countries and with other delegates; they tell you of what they would
do under certain circumstances and would not do under other circumstances. . . If these
reports . . . should become public . . . who would ever trust American Delegations in
another conference? (United States Department of State, Press Releases, June 7, 1930, pp. 282-
284.)."

x    x    x

There is frequent criticism of the secrecy in which negotiation with foreign powers on
nearly all subjects is concerned. This, it is claimed, is incompatible with the substance of
democracy. As expressed by one writer, "It can be said that there is no more rigid system of
silence anywhere in the world." (E.J. Young, Looking Behind the Censorship, J. B. Lippincott
Co., 1938) President Wilson in starting his efforts for the conclusion of the World War declared
that we must have "open covenants, openly arrived at." He quickly abandoned his thought.

No one who has studied the question believes that such a method of publicity is possible. In the
moment that negotiations are started, pressure groups attempt to "muscle in." An ill-timed
speech by one of the parties or a frank declaration of the concession which are exacted or
offered on both sides would quickly lead to widespread propaganda to block the
negotiations. After a treaty has been drafted and its terms are fully published, there is
ample opportunity for discussion before it is approved. (The New American Government and
Its Works, James T. Young, 4th Edition, p. 194) (Emphasis and underscoring supplied) cralawlibrary

Still in PMPF v. Manglapus, the Court adopted the doctrine in U.S. v. Curtiss-Wright Export
Corp.26 that the President is the sole organ of the nation in its negotiations with foreign countries,
viz:

"x x x In this vast external realm, with its important, complicated, delicate and manifold
problems, the President alone has the power to speak or listen as a representative of the nation.
He makes treaties with the advice and consent of the Senate; but he alone negotiates. Into the
field of negotiation the Senate cannot intrude; and Congress itself is powerless to invade it. As
Marshall said in his great argument of March 7, 1800, in the House of Representatives, "The
President is the sole organ of the nation in its external relations, and its sole representative
with foreign nations." Annals, 6th Cong., col. 613. . . (Emphasis supplied; underscoring in the
original)

Applying the principles adopted in PMPF v. Manglapus, it is clear that while the final text of the
JPEPA may not be kept perpetually confidential - since there should be "ample opportunity for
discussion before [a treaty] is approved" - the offers exchanged by the parties during the
negotiations continue to be privileged even after the JPEPA is published. It is reasonable to
conclude that the Japanese representatives submitted their offers with the understanding that
"historic confidentiality"27 would govern the same. Disclosing these offers could impair the
ability of the Philippines to deal not only with Japan but with other foreign governments in
future negotiations.
A ruling that Philippine offers in treaty negotiations should now be open to public scrutiny
would discourage future Philippine representatives from frankly expressing their views during
negotiations. While, on first impression, it appears wise to deter Philippine representatives from
entering into compromises, it bears noting that treaty negotiations, or any negotiation for that
matter, normally involve a process of quid pro quo, and oftentimes negotiators have to be
willing to grant concessions in an area of lesser importance in order to obtain more
favorable terms in an area of greater national interest. Apropos are the following
observations of Benjamin S. Duval, Jr.:

x x x [T]hose involved in the practice of negotiations appear to be in agreement that publicity

leads to "grandstanding," tends to freeze negotiating positions, and inhibits the give-and-take
essential to successful negotiation. As Sissela Bok points out, if "negotiators have more to gain
from being approved by their own sides than by making a reasoned agreement with competitors
or adversaries, then they are inclined to 'play to the gallery . . .'' In fact, the public reaction may
leave them little option. It would be a brave, or foolish, Arab leader who expressed publicly a
willingness for peace with Israel that did not involve the return of the entire West Bank, or Israeli
leader who stated publicly a willingness to remove Israel's existing settlements from Judea and
Samaria in return for peace.28 (Emphasis supplied) cralawlibrary

Indeed, by hampering the ability of our representatives to compromise, we may be jeopardizing

higher national goals for the sake of securing less critical ones.

Diplomatic negotiations, therefore, are recognized as privileged in this jurisdiction, the JPEPA
negotiations constituting no exception. It bears emphasis, however, that such privilege is only
presumptive. For as Senate v. Ermita holds, recognizing a type of information as privileged
does not mean that it will be considered privileged in all instances. Only after a consideration of
the context in which the claim is made may it be determined if there is a public interest that calls
for the disclosure of the desired information, strong enough to overcome its traditionally
privileged status.

Whether petitioners have established the presence of such a public interest shall be discussed
later. For now, the Court shall first pass upon the arguments raised by petitioners against the
application of PMPF v. Manglapus to the present case.

Arguments proffered by petitioners against the application of PMPF v. Manglapus

Petitioners argue that PMPF v. Manglapus cannot be applied in toto to the present case, there
being substantial factual distinctions between the two.

To petitioners, the first and most fundamental distinction lies in the nature of the treaty involved.
They stress that PMPF v. Manglapus involved the Military Bases Agreement which necessarily
pertained to matters affecting national security; whereas the present case involves an economic
treaty that seeks to regulate trade and commerce between the Philippines and Japan, matters
which, unlike those covered by the Military Bases Agreement, are not so vital to national
security to disallow their disclosure.
Petitioners' argument betrays a faulty assumption that information, to be considered privileged,
must involve national security. The recognition in Senate v. Ermita29 that executive privilege has
encompassed claims of varying kinds, such that it may even be more accurate to speak of
"executive privileges," cautions against such generalization.

While there certainly are privileges grounded on the necessity of safeguarding national security
such as those involving military secrets, not all are founded thereon. One example is the
"informer's privilege," or the privilege of the Government not to disclose the identity of a person
or persons who furnish information of violations of law to officers charged with the enforcement
of that law.30 The suspect involved need not be so notorious as to be a threat to national security
for this privilege to apply in any given instance. Otherwise, the privilege would be inapplicable
in all but the most high-profile cases, in which case not only would this be contrary to long-
standing practice. It would also be highly prejudicial to law enforcement efforts in general.

Also illustrative is the privilege accorded to presidential communications, which are presumed
privileged without distinguishing between those which involve matters of national security and
those which do not, the rationale for the privilege being that

x x x [a] frank exchange of exploratory ideas and assessments, free from the glare of publicity
and pressure by interested parties, is essential to protect the independence of decision-making
of those tasked to exercise Presidential, Legislative and Judicial power. x x x31 (Emphasis
supplied)cralawlibrary

In the same way that the privilege for judicial deliberations does not depend on the nature of the
case deliberated upon, so presidential communications are privileged whether they involve
matters of national security.

It bears emphasis, however, that the privilege accorded to presidential communications is not
absolute, one significant qualification being that "the Executive cannot, any more than the other
branches of government, invoke a general confidentiality privilege to shield its officials and
employees from investigations by the proper governmental institutions into possible criminal
wrongdoing." 32 This qualification applies whether the privilege is being invoked in the context
of a judicial trial or a congressional investigation conducted in aid of legislation.33

Closely related to the "presidential communications" privilege is the deliberative process

privilege recognized in the United States. As discussed by the U.S. Supreme Court in NLRB v.
Sears, Roebuck & Co,34 deliberative process covers documents reflecting advisory opinions,
recommendations and deliberations comprising part of a process by which governmental
decisions and policies are formulated. Notably, the privileged status of such documents rests, not
on the need to protect national security but, on the "obvious realization that officials will not
communicate candidly among themselves if each remark is a potential item of discovery and
front page news," the objective of the privilege being to enhance the quality of agency
decisionshttp://web2.westlaw.com/find/default.wl?
rs=WLW7.07&serialnum=1975129772&fn=_top&sv=Split&tc=-1&findtype=Y&tf=-
1&db=708&utid=%7b532A6DBF-9B4C-4A5A-8F16-C20D9BAA36C4%7d&vr=2.0&rp=
%2ffind%2fdefault.wl&mt=WLIGeneralSubscription.35
The diplomatic negotiations privilege bears a close resemblance to the deliberative process and
presidential communications privilege. It may be readily perceived that the rationale for the
confidential character of diplomatic negotiations, deliberative process, and presidential
communications is similar, if not identical.

The earlier discussion on PMPF v. Manglapus36 shows that the privilege for diplomatic
negotiations is meant to encourage a frank exchange of exploratory ideas between the
negotiating parties by shielding such negotiations from public view. Similar to the privilege for
presidential communications, the diplomatic negotiations privilege seeks, through the same
means, to protect the independence in decision-making of the President, particularly in its
capacity as "the sole organ of the nation in its external relations, and its sole representative with
foreign nations." And, as with the deliberative process privilege, the privilege accorded to
diplomatic negotiations arises, not on account of the content of the information per se, but
because the information is part of a process of deliberation which, in pursuit of the public
interest, must be presumed confidential.

The decision of the U.S. District Court, District of Columbia in Fulbright & Jaworski v.
Department of the Treasury37 enlightens on the close relation between diplomatic negotiations
and deliberative process privileges. The plaintiffs in that case sought access to notes taken by a
member of the U.S. negotiating team during the U.S.-French tax treaty negotiations. Among the
points noted therein were the issues to be discussed, positions which the French and U.S. teams
took on some points, the draft language agreed on, and articles which needed to be amended.
Upholding the confidentiality of those notes, Judge Green ruled, thus:

Negotiations between two countries to draft a treaty represent a true example of a

deliberative process. Much give-and-take must occur for the countries to reach an accord.
A description of the negotiations at any one point would not provide an onlooker a summary of
the discussions which could later be relied on as law. It would not be "working law" as the points
discussed and positions agreed on would be subject to change at any date until the treaty was
signed by the President and ratified by the Senate.

The policies behind the deliberative process privilege support non-disclosure. Much harm
could accrue to the negotiations process if these notes were revealed. Exposure of the pre-
agreement positions of the French negotiators might well offend foreign governments and
would lead to less candor by the U. S. in recording the events of the negotiations process.
As several months pass in between negotiations, this lack of record could hinder readily the U. S.
negotiating team. Further disclosure would reveal prematurely adopted policies. If these policies
should be changed, public confusion would result easily.

Finally, releasing these snapshot views of the negotiations would be comparable to

releasing drafts of the treaty, particularly when the notes state the tentative provisions and
language agreed on. As drafts of regulations typically are protected by the deliberative
process privilege, Arthur Andersen & Co. v. Internal Revenue Service, C.A. No. 80-705
(D.C.Cir., May 21, 1982), drafts of treaties should be accorded the same protection.
(Emphasis and underscoring supplied) cralawlibrary
Clearly, the privilege accorded to diplomatic negotiations follows as a logical consequence from
the privileged character of the deliberative process.

The Court is not unaware that in Center for International Environmental Law (CIEL), et al. v.
Office of U.S. Trade Representative38 - where the plaintiffs sought information relating to the
just-completed negotiation of a United States-Chile Free Trade Agreement - the same district
court, this time under Judge Friedman, consciously refrained from applying the doctrine in
Fulbright and ordered the disclosure of the information being sought.

Since the factual milieu in CIEL seemed to call for the straight application of the doctrine in
Fulbright, a discussion of why the district court did not apply the same would help illumine this
Court's own reasons for deciding the present case along the lines of Fulbright.

In both Fulbright and CIEL, the U.S. government cited a statutory basis for withholding
information, namely, Exemption 5 of the Freedom of Information Act (FOIA).39 In order to
qualify for protection under Exemption 5, a document must satisfy two conditions: (1) it must be
either inter-agency or intra-agency in nature, and (2) it must be both pre-decisional and part
of the agency's deliberative or decision-making process.40

Judge Friedman, in CIEL, himself cognizant of a "superficial similarity of context" between the
two cases, based his decision on what he perceived to be a significant distinction: he found the
negotiator's notes that were sought in Fulbright to be "clearly internal," whereas the documents
being sought in CIEL were those produced by or exchanged with an outside party, i.e. Chile. The
documents subject of Fulbright being clearly internal in character, the question of disclosure
therein turned not on the threshold requirement of Exemption 5 that the document be inter-
agency, but on whether the documents were part of the agency's pre-decisional deliberative
process. On this basis, Judge Friedman found that "Judge Green's discussion [in Fulbright] of the
harm that could result from disclosure therefore is irrelevant, since the documents at issue [in
CIEL] are not inter-agency, and the Court does not reach the question of deliberative
process." (Emphasis supplied) cralawlibrary

In fine, Fulbright was not overturned. The court in CIEL merely found the same to be irrelevant
in light of its distinct factual setting. Whether this conclusion was valid - a question on which
this Court would not pass - the ruling in Fulbright that "[n]egotiations between two countries to
draft a treaty represent a true example of a deliberative process" was left standing, since the
CIEL court explicitly stated that it did not reach the question of deliberative process.

Going back to the present case, the Court recognizes that the information sought by petitioners
includes documents produced and communicated by a party external to the Philippine
government, namely, the Japanese representatives in the JPEPA negotiations, and to that extent
this case is closer to the factual circumstances of CIEL than those of Fulbright.

Nonetheless, for reasons which shall be discussed shortly, this Court echoes the principle
articulated in Fulbright that the public policy underlying the deliberative process privilege
requires that diplomatic negotiations should also be accorded privileged status, even if the
documents subject of the present case cannot be described as purely internal in character.
It need not be stressed that in CIEL, the court ordered the disclosure of information based on its
finding that the first requirement of FOIA Exemption 5 - that the documents be inter-agency -
was not met. In determining whether the government may validly refuse disclosure of the
exchanges between the U.S. and Chile, it necessarily had to deal with this requirement, it being
laid down by a statute binding on them.

In this jurisdiction, however, there is no counterpart of the FOIA, nor is there any statutory
requirement similar to FOIA Exemption 5 in particular. Hence, Philippine courts, when assessing
a claim of privilege for diplomatic negotiations, are more free to focus directly on the issue of
whether the privilege being claimed is indeed supported by public policy, without having to
consider - as the CIEL court did - if these negotiations fulfill a formal requirement of being
"inter-agency." Important though that requirement may be in the context of domestic
negotiations, it need not be accorded the same significance when dealing with international
negotiations.

There being a public policy supporting a privilege for diplomatic negotiations for the reasons
explained above, the Court sees no reason to modify, much less abandon, the doctrine in PMPF
v. Manglapus.

A second point petitioners proffer in their attempt to differentiate PMPF v. Manglapus from the
present case is the fact that the petitioners therein consisted entirely of members of the mass
media, while petitioners in the present case include members of the House of Representatives
who invoke their right to information not just as citizens but as members of Congress.

Petitioners thus conclude that the present case involves the right of members of Congress to
demand information on negotiations of international trade agreements from the Executive
branch, a matter which was not raised in PMPF v. Manglapus.

While indeed the petitioners in PMPF v. Manglapus consisted only of members of the mass
media, it would be incorrect to claim that the doctrine laid down therein has no bearing on a
controversy such as the present, where the demand for information has come from members of
Congress, not only from private citizens.

The privileged character accorded to diplomatic negotiations does not ipso facto lose all
force and effect simply because the same privilege is now being claimed under different
circumstances. The probability of the claim succeeding in the new context might differ, but to
say that the privilege, as such, has no validity at all in that context is another matter altogether.

The Court's statement in Senate v. Ermita that "presidential refusals to furnish information may
be actuated by any of at least three distinct kinds of considerations [state secrets privilege,
informer's privilege, and a generic privilege for internal deliberations], and may be asserted, with
differing degrees of success, in the context of either judicial or legislative investigations,"41
implies that a privilege, once recognized, may be invoked under different procedural settings.
That this principle holds true particularly with respect to diplomatic negotiations may be inferred
from PMPF v. Manglapus itself, where the Court held that it is the President alone who
negotiates treaties, and not even the Senate or the House of Representatives, unless asked, may
intrude upon that process.

Clearly, the privilege for diplomatic negotiations may be invoked not only against citizens'
demands for information, but also in the context of legislative investigations.

Hence, the recognition granted in PMPF v. Manglapus to the privileged character of diplomatic
negotiations cannot be considered irrelevant in resolving the present case, the contextual
differences between the two cases notwithstanding.

As third and last point raised against the application of PMPF v. Manglapus in this case,
petitioners proffer that "the socio-political and historical contexts of the two cases are worlds
apart." They claim that the constitutional traditions and concepts prevailing at the time PMPF v.
Manglapus came about, particularly the school of thought that the requirements of foreign policy
and the ideals of transparency were incompatible with each other or the "incompatibility
hypothesis," while valid when international relations were still governed by power, politics and
wars, are no longer so in this age of international cooperation.42

Without delving into petitioners' assertions respecting the "incompatibility hypothesis," the Court
notes that the ruling in PMPF v. Manglapus is grounded more on the nature of treaty
negotiations as such than on a particular socio-political school of thought. If petitioners are
suggesting that the nature of treaty negotiations have so changed that "[a]n ill-timed speech by
one of the parties or a frank declaration of the concession which are exacted or offered on both
sides" no longer "lead[s] to widespread propaganda to block the negotiations," or that parties in
treaty negotiations no longer expect their communications to be governed by historic
confidentiality, the burden is on them to substantiate the same. This petitioners failed to
discharge.

Whether the privilege applies only at certain stages of the negotiation process

Petitioners admit that "diplomatic negotiations on the JPEPA are entitled to a reasonable amount
of confidentiality so as not to jeopardize the diplomatic process." They argue, however, that the
same is privileged "only at certain stages of the negotiating process, after which such information
must necessarily be revealed to the public."43 They add that the duty to disclose this information
was vested in the government when the negotiations moved from the formulation and
exploratory stage to the firming up of definite propositions or official recommendations, citing
Chavez v. PCGG44 and Chavez v. PEA.45

The following statement in Chavez v. PEA, however, suffices to show that the doctrine in both
that case and Chavez v. PCGG with regard to the duty to disclose "definite propositions of the
government" does not apply to diplomatic negotiations:

We rule, therefore, that the constitutional right to information includes official information on
on-going negotiations before a final contract. The information, however, must constitute
definite propositions by the government and should not cover recognized exceptions like
privileged information, military and diplomatic secrets and similar matters affecting
national security and public order. x x x46 (Emphasis and underscoring supplied) cralawlibrary

It follows from this ruling that even definite propositions of the government may not be
disclosed if they fall under "recognized exceptions." The privilege for diplomatic negotiations is
clearly among the recognized exceptions, for the footnote to the immediately quoted ruling cites
PMPF v. Manglapus itself as an authority.

Whether there is sufficient public interest to overcome the claim of privilege

It being established that diplomatic negotiations enjoy a presumptive privilege against disclosure,
even against the demands of members of Congress for information, the Court shall now
determine whether petitioners have shown the existence of a public interest sufficient to
overcome the privilege in this instance.

To clarify, there are at least two kinds of public interest that must be taken into account. One is
the presumed public interest in favor of keeping the subject information confidential, which is
the reason for the privilege in the first place, and the other is the public interest in favor of
disclosure, the existence of which must be shown by the party asking for information.47

The criteria to be employed in determining whether there is a sufficient public interest in favor of
disclosure may be gathered from cases such as U.S. v. Nixon,48 Senate Select Committee on
Presidential Campaign Activities v. Nixon,49 and In re Sealed Case.50

U.S. v. Nixon, which involved a claim of the presidential communications privilege against the
subpoena duces tecum of a district court in a criminal case, emphasized the need to balance such
claim of privilege against the constitutional duty of courts to ensure a fair administration of
criminal justice.

x x x the allowance of the privilege to withhold evidence that is demonstrably relevant in a

criminal trial would cut deeply into the guarantee of due process of law and gravely impair
the basic function of the courts. A President's acknowledged need for confidentiality in the
communications of his office is general in nature, whereas the constitutional need for
production of relevant evidence in a criminal proceeding is specific and central to the fair
adjudication of a particular criminal case in the administration of justice. Without access to
specific facts a criminal prosecution may be totally frustrated. The President's broad interest in
confidentiality of communications will not be vitiated by disclosure of a limited number of
conversations preliminarily shown to have some bearing on the pending criminal cases.
(Emphasis, italics and underscoring supplied)

Similarly, Senate Select Committee v. Nixon,51 which involved a claim of the presidential
communications privilege against the subpoena duces tecum of a Senate committee, spoke of the
need to balance such claim with the duty of Congress to perform its legislative functions.

The staged decisional structure established in Nixon v. Sirica was designed to ensure that the
President and those upon whom he directly relies in the performance of his duties could continue
to work under a general assurance that their deliberations would remain confidential. So long as
the presumption that the public interest favors confidentiality can be defeated only by a
strong showing of need by another institution of government - a showing that the
responsibilities of that institution cannot responsibly be fulfilled without access to records
of the President's deliberations - we believed in Nixon v. Sirica, and continue to believe, that
the effective functioning of the presidential office will not be impaired. x x x

x    x    x

The sufficiency of the Committee's showing of need has come to depend, therefore, entirely
on whether the subpoenaed materials are critical to the performance of its legislative
functions. x x x (Emphasis and underscoring supplied) cralawlibrary

In re Sealed Case52 involved a claim of the deliberative process and presidential communications
privileges against a subpoena duces tecum of a grand jury. On the claim of deliberative process
privilege, the court stated:

The deliberative process privilege is a qualified privilege and can be overcome by a sufficient
showing of need. This need determination is to be made flexibly on a case-by-case, ad hoc
basis. "[E]ach time [the deliberative process privilege] is asserted the district court must
undertake a fresh balancing of the competing interests," taking into account factors such as
"the relevance of the evidence," "the availability of other evidence," "the seriousness of the
litigation," "the role of the government," and the "possibility of future timidity by
government employees. x x x (Emphasis, italics and underscoring supplied)

Petitioners have failed to present the strong and "sufficient showing of need" referred to in the
immediately cited cases. The arguments they proffer to establish their entitlement to the subject
documents fall short of this standard.

Petitioners go on to assert that the non-involvement of the Filipino people in the JPEPA
negotiation process effectively results in the bargaining away of their economic and property
rights without their knowledge and participation, in violation of the due process clause of the
Constitution. They claim, moreover, that it is essential for the people to have access to the initial
offers exchanged during the negotiations since only through such disclosure can their
constitutional right to effectively participate in decision-making be brought to life in the context
of international trade agreements.

Whether it can accurately be said that the Filipino people were not involved in the JPEPA
negotiations is a question of fact which this Court need not resolve. Suffice it to state that
respondents had presented documents purporting to show that public consultations were
conducted on the JPEPA. Parenthetically, petitioners consider these "alleged consultations" as
"woefully selective and inadequate."53

AT ALL EVENTS, since it is not disputed that the offers exchanged by the Philippine and
Japanese representatives have not been disclosed to the public, the Court shall pass upon the
issue of whether access to the documents bearing on them is, as petitioners claim, essential to
their right to participate in decision-making.

The case for petitioners has, of course, been immensely weakened by the disclosure of the full
text of the JPEPA to the public since September 11, 2006, even as it is still being deliberated
upon by the Senate and, therefore, not yet binding on the Philippines. Were the Senate to concur
with the validity of the JPEPA at this moment, there has already been, in the words of PMPF v.
Manglapus, "ample opportunity for discussion before [the treaty] is approved."

The text of the JPEPA having been published, petitioners have failed to convince this Court that
they will not be able to meaningfully exercise their right to participate in decision-making unless
the initial offers are also published.

It is of public knowledge that various non-government sectors and private citizens have already
publicly expressed their views on the JPEPA, their comments not being limited to general
observations thereon but on its specific provisions. Numerous articles and statements critical of
the JPEPA have been posted on the Internet.54 Given these developments, there is no basis for
petitioners' claim that access to the Philippine and Japanese offers is essential to the exercise of
their right to participate in decision-making.

Petitioner-members of the House of Representatives additionally anchor their claim to have a

right to the subject documents on the basis of Congress' inherent power to regulate commerce, be
it domestic or international. They allege that Congress cannot meaningfully exercise the power to
regulate international trade agreements such as the JPEPA without being given copies of the
initial offers exchanged during the negotiations thereof. In the same vein, they argue that the
President cannot exclude Congress from the JPEPA negotiations since whatever power and
authority the President has to negotiate international trade agreements is derived only by
delegation of Congress, pursuant to Article VI, Section 28(2) of the Constitution and Sections
401 and 402 of Presidential Decree No. 1464.55

The subject of Article VI Section 28(2) of the Constitution is not the power to negotiate treaties
and international agreements, but the power to fix tariff rates, import and export quotas, and
other taxes. Thus it provides:

(2) The Congress may, by law, authorize the President to fix within specified limits, and subject
to such limitations and restrictions as it may impose, tariff rates, import and export quotas,
tonnage and wharfage dues, and other duties or imposts within the framework of the national
development program of the Government.

As to the power to negotiate treaties, the constitutional basis thereof is Section 21 of Article VII -
the article on the Executive Department - which states:

No treaty or international agreement shall be valid and effective unless concurred in by at least
two-thirds of all the Members of the Senate.
The doctrine in PMPF v. Manglapus that the treaty-making power is exclusive to the President,
being the sole organ of the nation in its external relations, was echoed in BAYAN v. Executive
Secretary56 where the Court held:

By constitutional fiat and by the intrinsic nature of his office, the President, as head of State, is
the sole organ and authority in the external affairs of the country. In many ways, the President is
the chief architect of the nation's foreign policy; his "dominance in the field of foreign relations
is (then) conceded." Wielding vast powers and influence, his conduct in the external affairs of
the nation, as Jefferson describes, is "executive altogether."

As regards the power to enter into treaties or international agreements, the Constitution
vests the same in the President, subject only to the concurrence of at least two thirds vote of
all the members of the Senate. In this light, the negotiation of the VFA and the subsequent
ratification of the agreement are exclusive acts which pertain solely to the President, in the
lawful exercise of his vast executive and diplomatic powers granted him no less than by the
fundamental law itself. Into the field of negotiation the Senate cannot intrude, and
Congress itself is powerless to invade it. x x x(Italics in the original; emphasis and
underscoring supplied)

The same doctrine was reiterated even more recently in Pimentel v. Executive Secretary57 where
the Court ruled:

In our system of government, the President, being the head of state, is regarded as the sole organ
and authority in external relations and is the country's sole representative with foreign
nations. As the chief architect of foreign policy, the President acts as the country's mouthpiece
with respect to international affairs. Hence, the President is vested with the authority to deal
with foreign states and governments, extend or withhold recognition, maintain diplomatic
relations, enter into treaties, and otherwise transact the business of foreign relations. In the
realm of treaty-making, the President has the sole authority to negotiate with other states.

Nonetheless, while the President has the sole authority to negotiate and enter into treaties, the
Constitution provides a limitation to his power by requiring the concurrence of 2/3 of all the
members of the Senate for the validity of the treaty entered into by him. x x x (Emphasis and
underscoring supplied) cralawlibrary

While the power then to fix tariff rates and other taxes clearly belongs to Congress, and is
exercised by the President only by delegation of that body, it has long been recognized that the
power to enter into treaties is vested directly and exclusively in the President, subject only to the
concurrence of at least two-thirds of all the Members of the Senate for the validity of the treaty.
In this light, the authority of the President to enter into trade agreements with foreign nations
provided under P.D. 146458 may be interpreted as an acknowledgment of a power already
inherent in its office. It may not be used as basis to hold the President or its representatives
accountable to Congress for the conduct of treaty negotiations.
This is not to say, of course, that the President's power to enter into treaties is unlimited but for
the requirement of Senate concurrence, since the President must still ensure that all treaties will
substantively conform to all the relevant provisions of the Constitution.

It follows from the above discussion that Congress, while possessing vast legislative powers,
may not interfere in the field of treaty negotiations. While Article VII, Section 21 provides for
Senate concurrence, such pertains only to the validity of the treaty under consideration, not to the
conduct of negotiations attendant to its conclusion. Moreover, it is not even Congress as a whole
that has been given the authority to concur as a means of checking the treaty-making power of
the President, but only the Senate.

Thus, as in the case of petitioners suing in their capacity as private citizens, petitioners-members
of the House of Representatives fail to present a "sufficient showing of need" that the
information sought is critical to the performance of the functions of Congress, functions that do
not include treaty-negotiation.

Respondents' alleged failure to timely claim executive privilege

On respondents' invocation of executive privilege, petitioners find the same defective, not having
been done seasonably as it was raised only in their Comment to the present petition and not
during the House Committee hearings.

That respondents invoked the privilege for the first time only in their Comment to the present
petition does not mean that the claim of privilege should not be credited. Petitioners' position
presupposes that an assertion of the privilege should have been made during the House
Committee investigations, failing which respondents are deemed to have waived it.

When the House Committee and petitioner-Congressman Aguja requested respondents for copies
of the documents subject of this case, respondents replied that the negotiations were still on-
going and that the draft of the JPEPA would be released once the text thereof is settled and
complete. There was no intimation that the requested copies are confidential in nature by reason
of public policy. The response may not thus be deemed a claim of privilege by the standards of
Senate v. Ermita, which recognizes as claims of privilege only those which are accompanied by
precise and certain reasons for preserving the confidentiality of the information being sought.

Respondents' failure to claim the privilege during the House Committee hearings may not,
however, be construed as a waiver thereof by the Executive branch. As the immediately
preceding paragraph indicates, what respondents received from the House Committee and
petitioner-Congressman Aguja were mere requests for information. And as priorly stated, the
House Committee itself refrained from pursuing its earlier resolution to issue a subpoena duces
tecum on account of then Speaker Jose de Venecia's alleged request to Committee Chairperson
Congressman Teves to hold the same in abeyance.

While it is a salutary and noble practice for Congress to refrain from issuing subpoenas to
executive officials - out of respect for their office - until resort to it becomes necessary, the fact
remains that such requests are not a compulsory process. Being mere requests, they do not
strictly call for an assertion of executive privilege.

The privilege is an exemption to Congress' power of inquiry.59 So long as Congress itself finds
no cause to enforce such power, there is no strict necessity to assert the privilege. In this light,
respondents' failure to invoke the privilege during the House Committee investigations did not
amount to a waiver thereof.

The Court observes, however, that the claim of privilege appearing in respondents' Comment to
this petition fails to satisfy in full the requirement laid down in Senate v. Ermita that the claim
should be invoked by the President or through the Executive Secretary "by order of the
President."60 Respondents' claim of privilege is being sustained, however, its flaw
notwithstanding, because of circumstances peculiar to the case.

The assertion of executive privilege by the Executive Secretary, who is one of the respondents
herein, without him adding the phrase "by order of the President," shall be considered as partially
complying with the requirement laid down in Senate v. Ermita. The requirement that the phrase
"by order of the President" should accompany the Executive Secretary's claim of privilege is a
new rule laid down for the first time in Senate v. Ermita, which was not yet final and executory
at the time respondents filed their Comment to the petition.61 A strict application of this
requirement would thus be unwarranted in this case.

Response to the Dissenting Opinion of the Chief Justice

We are aware that behind the dissent of the Chief Justice lies a genuine zeal to protect our
people's right to information against any abuse of executive privilege. It is a zeal that We fully
share.

The Court, however, in its endeavor to guard against the abuse of executive privilege, should be
careful not to veer towards the opposite extreme, to the point that it would strike down as invalid
even a legitimate exercise thereof.

We respond only to the salient arguments of the Dissenting Opinion which have not yet been
sufficiently addressed above.

1. After its historical discussion on the allocation of power over international trade agreements in
the United States, the dissent concludes that "it will be turning somersaults with history to
contend that the President is the sole organ for external relations" in that jurisdiction. With
regard to this opinion, We make only the following observations:

There is, at least, a core meaning of the phrase "sole organ of the nation in its external relations"
which is not being disputed, namely, that the power to directly negotiate treaties and
international agreements is vested by our Constitution only in the Executive. Thus, the dissent
states that "Congress has the power to regulate commerce with foreign nations but does not
have the power to negotiate international agreements directly."62
What is disputed is how this principle applies to the case at bar.

The dissent opines that petitioner-members of the House of Representatives, by asking for the
subject JPEPA documents, are not seeking to directly participate in the negotiations of the
JPEPA, hence, they cannot be prevented from gaining access to these documents.

On the other hand, We hold that this is one occasion where the following ruling in Agan v.
PIATCO63 - and in other cases both before and since - should be applied:

This Court has long and consistently adhered to the legal maxim that those that cannot be
done directly cannot be done indirectly. To declare the PIATCO contracts valid despite the
clear statutory prohibition against a direct government guarantee would not only make a
mockery of what the BOT Law seeks to prevent - - which is to expose the government to the risk
of incurring a monetary obligation resulting from a contract of loan between the project
proponent and its lenders and to which the Government is not a party to - - but would also
render the BOT Law useless for what it seeks to achieve - - to make use of the resources of the
private sector in the "financing, operation and maintenance of infrastructure and development
projects" which are necessary for national growth and development but which the government,
unfortunately, could ill-afford to finance at this point in time.64

Similarly, while herein petitioners-members of the House of Representatives may not have been
aiming to participate in the negotiations directly, opening the JPEPA negotiations to their
scrutiny - even to the point of giving them access to the offers exchanged between the Japanese
and Philippine delegations - would have made a mockery of what the Constitution sought to
prevent and rendered it useless for what it sought to achieve when it vested the power of direct
negotiation solely with the President.

What the U.S. Constitution sought to prevent and aimed to achieve in defining the treaty-making
power of the President, which our Constitution similarly defines, may be gathered from
Hamilton's explanation of why the U.S. Constitution excludes the House of Representatives from
the treaty-making process:

x x x The fluctuating, and taking its future increase into account, the multitudinous composition
of that body, forbid us to expect in it those qualities which are essential to the proper execution
of such a trust. Accurate and comprehensive knowledge of foreign politics; a steady and
systematic adherence to the same views; a nice and uniform sensibility to national character,
decision, secrecy and dispatch; are incompatible with a body so variable and so numerous. The
very complication of the business by introducing a necessity of the concurrence of so many
different bodies, would of itself afford a solid objection. The greater frequency of the calls upon
the house of representatives, and the greater length of time which it would often be necessary to
keep them together when convened, to obtain their sanction in the progressive stages of a treaty,
would be source of so great inconvenience and expense, as alone ought to condemn the project.65

These considerations a fortiori apply in this jurisdiction, since the Philippine Constitution, unlike
that of the U.S., does not even grant the Senate the power to advise the Executive in the making
of treaties, but only vests in that body the power to concur in the validity of the treaty after
negotiations have been concluded.66 Much less, therefore, should it be inferred that the House of
Representatives has this power.

Since allowing petitioner-members of the House of Representatives access to the subject JPEPA
documents would set a precedent for future negotiations, leading to the contravention of the
public interests articulated above which the Constitution sought to protect, the subject documents
should not be disclosed.

2. The dissent also asserts that respondents can no longer claim the diplomatic secrets privilege
over the subject JPEPA documents now that negotiations have been concluded, since their
reasons for nondisclosure cited in the June 23, 2005 letter of Sec. Ermita, and later in their
Comment, necessarily apply only for as long as the negotiations were still pending;

In their Comment, respondents contend that "the negotiations of the representatives of the
Philippines as well as of Japan must be allowed to explore alternatives in the course of the
negotiations in the same manner as judicial deliberations and working drafts of opinions are
accorded strict confidentiality." That respondents liken the documents involved in the
JPEPA negotiations to judicial deliberations and working drafts of opinions evinces, by
itself, that they were claiming confidentiality not only until, but even after, the conclusion
of the negotiations.

Judicial deliberations do not lose their confidential character once a decision has been
promulgated by the courts. The same holds true with respect to working drafts of opinions,
which are comparable to intra-agencyrecommendations. Such intra-agency recommendations are
privileged even after the position under consideration by the agency has developed into a definite
proposition, hence, the rule in this jurisdiction that agencies have the duty to disclose only
definite propositions, and not the inter-agency and intra-agency communications during the stage
when common assertions are still being formulated.67

3. The dissent claims that petitioner-members of the House of Representatives have sufficiently
shown their need for the same documents to overcome the privilege. Again, We disagree.

The House Committee that initiated the investigations on the JPEPA did not pursue its earlier
intention to subpoena the documents. This strongly undermines the assertion that access to the
same documents by the House Committee is critical to the performance of its legislative
functions. If the documents were indeed critical, the House Committee should have, at the very
least, issued a subpoena duces tecum or, like what the Senate did in Senate v. Ermita, filed the
present petition as a legislative body, rather than leaving it to the discretion of individual
Congressmen whether to pursue an action or not. Such acts would have served as strong indicia
that Congress itself finds the subject information to be critical to its legislative functions.

Further, given that respondents have claimed executive privilege, petitioner-members of the
House of Representatives should have, at least, shown how its lack of access to the Philippine
and Japanese offers would hinder the intelligent crafting of legislation. Mere assertion that the
JPEPA covers a subject matter over which Congress has the power to legislate would not suffice.
As Senate Select Committee v. Nixon68 held, the showing required to overcome the presumption
favoring confidentiality turns, not only on the nature and appropriateness of the function in the
performance of which the material was sought, but also the degree to which the material was
necessary to its fulfillment. This petitioners failed to do.

Furthermore, from the time the final text of the JPEPA including its annexes and attachments
was published, petitioner-members of the House of Representatives have been free to use it for
any legislative purpose they may see fit. Since such publication, petitioners' need, if any,
specifically for the Philippine and Japanese offers leading to the final version of the JPEPA, has
become even less apparent.

In asserting that the balance in this instance tilts in favor of disclosing the JPEPA documents, the
dissent contends that the Executive has failed to show how disclosing them after the conclusion
of negotiations would impair the performance of its functions. The contention, with due respect,
misplaces the onus probandi. While, in keeping with the general presumption of transparency,
the burden is initially on the Executive to provide precise and certain reasons for upholding its
claim of privilege, once the Executive is able to show that the documents being sought are
covered by a recognized privilege, the burden shifts to the party seeking information to
overcome the privilege by a strong showing of need.

When it was thus established that the JPEPA documents are covered by the privilege for
diplomatic negotiations pursuant to PMPF v. Manglapus, the presumption arose that their
disclosure would impair the performance of executive functions. It was then incumbent on
petitioner - requesting parties to show that they have a strong need for the information sufficient
to overcome the privilege. They have not, however.

4. Respecting the failure of the Executive Secretary to explicitly state that he is claiming the
privilege "by order of the President," the same may not be strictly applied to the privilege claim
subject of this case.

When the Court in Senate v. Ermita limited the power of invoking the privilege to the President
alone, it was laying down a new rule for which there is no counterpart even in the United States
from which the concept of executive privilege was adopted. As held in the 2004 case of Judicial
Watch, Inc. v. Department of Justice,69 citing In re Sealed Case,70 "the issue of whether a
President must personally invoke the [presidential communications] privilege remains an open
question." U.S. v. Reynolds,71 on the other hand, held that "[t]here must be a formal claim of
privilege, lodged by the head of the department which has control over the matter, after actual
personal consideration by that officer."

The rule was thus laid down by this Court, not in adherence to any established precedent, but
with the aim of preventing the abuse of the privilege in light of its highly exceptional nature. The
Court's recognition that the Executive Secretary also bears the power to invoke the privilege,
provided he does so "by order of the President," is meant to avoid laying down too rigid a rule,
the Court being aware that it was laying down a new restriction on executive privilege. It is with
the same spirit that the Court should not be overly strict with applying the same rule in this
peculiar instance, where the claim of executive privilege occurred before the judgment in Senate
v. Ermita became final.
5. To show that PMPF v. Manglapus may not be applied in the present case, the dissent implies
that the Court therein erred in citing US v. Curtiss Wright72 and the book entitled The New
American Government and Its Work73 since these authorities, so the dissent claims, may not be
used to calibrate the importance of the right to information in the Philippine setting.

The dissent argues that since Curtiss-Wright referred to a conflict between the executive and
legislative branches of government, the factual setting thereof was different from that of PMPF
v. Manglapus which involved a collision between governmental power over the conduct of
foreign affairs and the citizen's right to information.

That the Court could freely cite Curtiss-Wright - a case that upholds the secrecy of diplomatic
negotiations against congressional demands for information - in the course of laying down a
ruling on the public right to informationonly serves to underscore the principle mentioned earlier
that the privileged character accorded to diplomatic negotiations does not ipso facto lose all force
and effect simply because the same privilege is now being claimed under different
circumstances.

PMPF v. Manglapus indeed involved a demand for information from private citizens and not an
executive-legislative conflict, but so did Chavez v. PEA74 which held that "the [public's] right to
information . . . does not extend to matters recognized as privileged information under the
separation of powers." What counts as privileged information in an executive-legislative conflict
is thus also recognized as such in cases involving the public's right to information.

Chavez v. PCGG75 also involved the public's right to information, yet the Court recognized as a
valid limitation to that right the same privileged information based on separation of powers -
closed-door Cabinet meetings, executive sessions of either house of Congress, and the internal
deliberations of the Supreme Court.

These cases show that the Court has always regarded claims of privilege, whether in the context
of an executive-legislative conflict or a citizen's demand for information, as closely intertwined,
such that the principles applicable to one are also applicable to the other.

The reason is obvious. If the validity of claims of privilege were to be assessed by entirely
different criteria in each context, this may give rise to the absurd result where Congress would
be denied access to a particular information because of a claim of executive privilege, but the
general public would have access to the same information, the claim of privilege
notwithstanding.

Absurdity would be the ultimate result if, for instance, the Court adopts the "clear and present
danger" test for the assessment of claims of privilege against citizens' demands for information.
If executive information, when demanded by a citizen, is privileged only when there is a clear
and present danger of a substantive evil that the State has a right to prevent, it would be very
difficult for the Executive to establish the validity of its claim in each instance. In contrast, if the
demand comes from Congress, the Executive merely has to show that the information is covered
by a recognized privilege in order to shift the burden on Congress to present a strong showing of
need. This would lead to a situation where it would be more difficult for Congress to access
executive information than it would be for private citizens.

We maintain then that when the Executive has already shown that an information is covered by
executive privilege, the party demanding the information must present a "strong showing of
need," whether that party is Congress or a private citizen.

The rule that the same "showing of need" test applies in both these contexts, however, should not
be construed as a denial of the importance of analyzing the context in which an executive
privilege controversy may happen to be placed. Rather, it affirms it, for it means that the specific
need being shown by the party seeking information in every particular instance is highly
significant in determining whether to uphold a claim of privilege. This "need" is, precisely,
part of the context in light of which every claim of privilege should be assessed.

Since, as demonstrated above, there are common principles that should be applied to executive
privilege controversies across different contexts, the Court in PMPF v. Manglapus did not err
when it cited the Curtiss-Wright case.

The claim that the book cited in PMPF v. Manglapus entitled The New American Government
and Its Work could not have taken into account the expanded statutory right to information in the
FOIA assumes that the observations in that book in support of the confidentiality of treaty
negotiations would be different had it been written after the FOIA. Such assumption is, with due
respect, at best, speculative.

As to the claim in the dissent that "[i]t is more doubtful if the same book be used to calibrate the
importance of the right of access to information in the Philippine setting considering its elevation
as a constitutional right," we submit that the elevation of such right as a constitutional right did
not set it free from the legitimate restrictions of executive privilege which is itself
constitutionally-based.76 Hence, the comments in that book which were cited in PMPF v.
Manglapus remain valid doctrine.

6.The dissent further asserts that the Court has never used "need" as a test to uphold or allow
inroads into rights guaranteed under the Constitution. With due respect, we assert otherwise. The
Court has done so before, albeit without using the term "need."

In executive privilege controversies, the requirement that parties present a "sufficient showing of
need" only means, in substance, that they should show a public interest in favor of disclosure
sufficient in degree to overcome the claim of privilege.77 Verily, the Court in such cases engages
in a balancing of interests. Such a balancing of interests is certainly not new in constitutional
adjudication involving fundamental rights. Secretary of Justice v. Lantion,78 which was cited in
the dissent, applied just such a test.

Given that the dissent has clarified that it does not seek to apply the "clear and present danger"
test to the present controversy, but the balancing test, there seems to be no substantial dispute
between the position laid down in this ponencia and that reflected in the dissent as to what test to
apply. It would appear that the only disagreement is on the results of applying that test in this
instance.

The dissent, nonetheless, maintains that "it suffices that information is of public concern for it to
be covered by the right, regardless of the public's need for the information," and that the same
would hold true even "if they simply want to know it because it interests them." As has been
stated earlier, however, there is no dispute that the information subject of this case is a matter of
public concern. The Court has earlier concluded that it is a matter of public concern, not on the
basis of any specific need shown by petitioners, but from the very nature of the JPEPA as an
international trade agreement.

However, when the Executive has - as in this case - invoked the privilege, and it has been
established that the subject information is indeed covered by the privilege being claimed, can a
party overcome the same by merely asserting that the information being demanded is a matter of
public concern, without any further showing required? Certainly not, for that would render the
doctrine of executive privilege of no force and effect whatsoever as a limitation on the right to
information, because then the sole test in such controversies would be whether an information is
a matter of public concern.

Moreover, in view of the earlier discussions, we must bear in mind that, by disclosing the
documents of the JPEPA negotiations, the Philippine government runs the grave risk of betraying
the trust reposed in it by the Japanese representatives, indeed, by the Japanese government itself.
How would the Philippine government then explain itself when that happens? Surely, it cannot
bear to say that it just had to release the information because certain persons simply wanted to
know it "because it interests them."

Thus, the Court holds that, in determining whether an information is covered by the right to
information, a specific "showing of need" for such information is not a relevant consideration,
but only whether the same is a matter of public concern. When, however, the government has
claimed executive privilege, and it has established that the information is indeed covered by the
same, then the party demanding it, if it is to overcome the privilege, must show that that the
information is vital, not simply for the satisfaction of its curiosity, but for its ability to effectively
and reasonably participate in social, political, and economic decision-making.79

7. The dissent maintains that "[t]he treaty has thus entered the ultimate stage where the people
can exercise their right to participate in the discussion whether the Senate should concur in its
ratification or not." (Emphasis supplied) It adds that this right "will be diluted unless the people
can have access to the subject JPEPA documents". What, to the dissent, is a dilution of the right
to participate in decision-making is, to Us, simply a recognition of the qualified nature of the
public's right to information. It is beyond dispute that the right to information is not absolute and
that the doctrine of executive privilege is a recognized limitation on that right.

Moreover, contrary to the submission that the right to participate in decision-making would be
diluted, We reiterate that our people have been exercising their right to participate in the
discussion on the issue of the JPEPA, and they have been able to articulate their different
opinions without need of access to the JPEPA negotiation documents.
Thus, we hold that the balance in this case tilts in favor of executive privilege.

8. Against our ruling that the principles applied in U.S. v. Nixon, the Senate Select Committee
case, and In re Sealed Case, are similarly applicable to the present controversy, the dissent cites
the caveat in the Nixon case that the U.S. Court was there addressing only the President's
assertion of privilege in the context of a criminal trial, not a civil litigation nor a congressional
demand for information. What this caveat means, however, is only that courts must be careful
not to hastily apply the ruling therein to other contexts. It does not, however, absolutely mean
that the principles applied in that case may never be applied in such contexts.

Hence, U.S. courts have cited U.S. v. Nixon in support of their rulings on claims of executive
privilege in contexts other than a criminal trial, as in the case of Nixon v. Administrator of
General Services80 - which involved former President Nixon's invocation of executive privilege
to challenge the constitutionality of the "Presidential Recordings and Materials Preservation
Act"81 - and the above-mentioned In re Sealed Case which involved a claim of privilege against a
subpoena duces tecum issued in a grand jury investigation.

Indeed, in applying to the present case the principles found in U.S. v. Nixon and in the other
cases already mentioned, We are merely affirming what the Chief Justice stated in his Dissenting
Opinion in Neri v. Senate Committee on Accountability82 - a case involving an executive-
legislative conflict over executive privilege. That dissenting opinion stated that, while Nixon was
not concerned with the balance between the President's generalized interest in confidentiality and
congressional demands for information, "[n]onetheless the [U.S.] Court laid down principles
and procedures that can serve as torch lights to illumine us on the scope and use of
Presidential communication privilege in the case at bar."83 While the Court was divided in
Neri, this opinion of the Chief Justice was not among the points of disagreement, and We
similarly hold now that the Nixon case is a useful guide in the proper resolution of the present
controversy, notwithstanding the difference in context.

Verily, while the Court should guard against the abuse of executive privilege, it should also
give full recognition to the validity of the privilege whenever it is claimed within the proper
bounds of executive power, as in this case. Otherwise, the Court would undermine its own
credibility, for it would be perceived as no longer aiming to strike a balance, but seeking merely
to water down executive privilege to the point of irrelevance.

Conclusion

To recapitulate, petitioners' demand to be furnished with a copy of the full text of the JPEPA has
become moot and academic, it having been made accessible to the public since September 11,
2006. As for their demand for copies of the Philippine and Japanese offers submitted during the
JPEPA negotiations, the same must be denied, respondents' claim of executive privilege being
valid.

Diplomatic negotiations have, since the Court promulgated its Resolution in PMPF v. Manglapus
on September 13, 1988, been recognized as privileged in this jurisdiction and the reasons
proffered by petitioners against the application of the ruling therein to the present case have not
persuaded the Court. Moreover, petitioners - both private citizens and members of the House of
Representatives - have failed to present a "sufficient showing of need" to overcome the claim of
privilege in this case.

That the privilege was asserted for the first time in respondents' Comment to the present petition,
and not during the hearings of the House Special Committee on Globalization, is of no moment,
since it cannot be interpreted as a waiver of the privilege on the part of the Executive branch.

For reasons already explained, this Decision shall not be interpreted as departing from the ruling
in Senate v. Ermita that executive privilege should be invoked by the President or through the
Executive Secretary "by order of the President."

WHEREFORE, the petition is DISMISSED.

SO ORDERED.
 G.R. No. 171101, April 24, 2018

HACIENDA LUISITA INCORPORATED, PETITIONER, LUISITA INDUSTRIAL

PARK CORPORATION AND RIZAL COMMERCIAL BANKING CORPORATION,
Petitioners-in-Intervention, v. PRESIDENTIAL AGRARIAN REFORM COUNCIL;
SECRETARY NASSER PANGANDAMAN OF THE DEPARTMENT OF AGRARIAN
REFORM; ALYANSA NG MGA MANGGAGAWANG BUKID NG HACIENDA
LUISITA, RENE GALANG, NOEL MALLARI, AND JULIO SUNIGA AND HIS
SUPERVISORY GROUP OF THE HACIENDA LUISITA, INC. AND WINDSOR
ANDAYA, Respondents.

RESOLUTION

VELASCO JR., J.:

This treats of the "Motion for Execution of the 05 July 2011 Decision" interposed by respondents
Noel Mallari and Windsor Andaya.1

As a backgrounder, in the fallo of its underlying Decision of July 5, 2011, the Court directed
petitioner Hacienda Luisita Incorporated (HLI) to, among other things, pay the 6,296 qualified
farm-worker beneficiaries (FWBs) of the hacienda the unspent or unused balance of the proceeds
of the sale of the 580.51-hectare lot received by the company, viz:

HLI is directed to pay the 6,296 FWBs the consideration of PhP500,000,000 received by it from
Luisita Realty, Inc. for the sale to the latter of 200 hectares out of the 500 hectares covered by
the August 14, 1996 Conversion Order, the consideration of PhP750,000,000 received by its
owned subsidiary, Centennary Holdings, Inc. for the sale of the remaining 300 hectares of the
aforementioned 500-hectare lot to Luisita Industrial Park Corporation, and the price of
PhP80,511,500 paid by the government through the Bases Conversion Development Authority
for the sale of the 80. 51-hectare lot used for the construction of the SCTEX road network. From
the total amount of PhP1,330,511,500 (PhP500,000,000 + PhP750,000,000 + PhP80,511,500
= PhP1,330,511,500) shall be deducted the 3% of the total gross sales from the production
of the agricultural land and the 3% of the proceeds of said transfers that were paid to the
FWBs, the taxes and expenses relating to the transfer of titles to the transferees, and the
expenditures incurred by HLI and Centennary Holdings, Inc. for legitimate corporate
purposes. For this purpose, DAR is ordered to engage the services of a reputable accounting
firm approved by the parties to audit the books of HLI and Centennary Holdings, Inc. to
determine if the PhP1,330,511,500 proceeds of the sale of the three (3) aforementioned lots were
used or spent for legitimate corporate purposes. Any unspent or unused balance as determined
by the audit shall be distributed to the 6,296 original FWBs.2
On November 22, 2011, the Court, acting on several incidents, issued a Resolution denying, in
the main, petitioner's motion for reconsideration and standing firm in its Decision of July 5,
2011. The dispositive portion of the Court's Resolution reads in full as follows:
WHEREFORE, the Motion for Partial Reconsideration dated July 20, 2011 filed by public
respondents Presidential Agrarian Reform Council and Department of Agrarian Reform, the
Motion for Reconsideration dated July 19, 2011 filed by private respondent Alyansa ng mga
Manggagawang Bukid sa Hacienda Luisita, the Motion for Reconsideration dated July 21, 2011
filed by respondent-intervenor Farmworkers Agrarian Reform Movement, Inc., and the Motion
for Reconsideration dated July 22, 2011 filed by private respondents Rene Galang and
AMBALA are PARTIALLY GRANTED with respect to the option granted to the original
farmworker-beneficiaries of Hacienda Luisita to remain with Hacienda Luisita, Inc., which
is hereby RECALLED and SET ASIDE. The Motion for Clarification and Partial
Reconsideration dated July 21, 2011 filed by petitioner HLI and the Motion for Reconsideration
dated July 21, 2011 filed by private respondents Noel Mallari, Julio Suniga, Supervisory Group
of Hacienda Luisita, Inc. and Windsor Andaya are DENIED.
The fallo of the Court's July 5, 2011 Decision is hereby amended and shall read:
PARC Resolution No. 2005-32-01 dated December 22, 2005 and Resolution No. 2006-34-01
dated May 3, 2006, placing the lands subject of HLI's SDP under compulsory coverage on
mandated land acquisition scheme of the CARP, are hereby AFFIRMED with the following
modifications:

All salaries, benefits, the 3% of the gross sales of the production of the agricultural lands, the 3%
share in the proceeds of the sale of the 500- hectare converted land and the 80.51-hectare
SCTEX lot and the homelots already received by the 10,502 FWBs composed of 6,296 original
FWBs and the 4,206 non-qualified FWBs shall be respected with no obligation to refund or
return them. The 6,296 original FWBs shall forfeit and relinquish their rights over the HLI shares
of stock issued to them in favor of HLI. The HLI Corporate Secretary shall cancel the shares
issued to the said FWBs and transfer them to HLI in the stocks and transfer book, which transfers
shall be exempt from taxes, fees and charges. The 4,206 non-qualified FWBs shall remain as
stockholders of HLI.

DAR shall segregate from the HLI agricultural land with an area of 4,915.75 hectares subject of
PARC's SOP-approving Resolution No. 89-12-2 the 500-hectare lot subject of the August 14,
1996 Conversion Order and the 80.51-hectare lot sold to, or acquired by, the government as part
of the SCTEX complex. After the segregation process, as indicated, is done, the remaining area
shall be turned over to DAR for immediate land distribution to the original 6,296 FWBs or their
successors-in-interest which will be identified by the DAR. The 4,206 non-qualified FWBs are
not entitled to any share in the land to be distributed by DAR.

HLI is directed to pay the original 6,296 FWBs the consideration of PhP500,000,000
received by it from Luisita Realty, Inc. for the sale to the latter of 200 hectares out of the
500 hectares covered by the August 14, 1996 Conversion Order, the consideration of
PhP750,000,000 received by its owned subsidiary, Centennary Holdings, Inc., for the sale of
the remaining 300 hectares of the aforementioned 500-hectare lot to Luisita Industrial Park
Corporation, and the price of PhP80,511,500 paid by the government through the Bases
Conversion Development Authority for the sale of the 80.51-hectare lot used for the
construction of the SCTEX road network. From the total amount of PhP1,330,511,500
(PhP500,000,000 + PhP750,000,000 + PhP80,511,500 = PhP1,330,511,500) shall be deducted
the 3% of the proceeds of said transfers that were paid to the FWBs, the taxes and expenses
relating to the transfer of titles to the transferees, and the expenditures incurred by HLI
and Centennary Holdings, Inc. for legitimate corporate purposes. For this purpose, DAR is
ordered to engage the services of a reputable accounting firm approved by the parties to
audit the books of HLI and Centennary Holdings, Inc. to determine if the
PhP1,330,511,500 proceeds of the sale of the three (3) aforementioned lots were actually
used or spent for legitimate corporate purposes. Any unspent or unused balance and any
disallowed expenditures as determined by the audit shall be distributed to the 6,296
original FWBs.

HLI is entitled to just compensation for the agricultural land that will be transferred to DAR to
be reckoned from November 21, 1989 which is the date of issuance of PARC Resolution No. 89-
12-2. DAR and LBP are ordered to determine the compensation due to HLI.

DAR shall submit a compliance report after six (6) months from finality of this judgment. It shall
also submit, after submission of the compliance report, quarterly reports on the execution of this
judgment within the first 15 days after the end of each quarter, until fully implemented.

The temporary restraining order is lifted.

SO ORDERED.3
The July 5, 2011 Decision of the Court, as affirmed with modification in its November 22, 2011
Resolution, became final and executory on April 24, 2012. Thus, for purposes of determining the
actual amount that may be distributed to the qualified FWBs, the Court issued a Resolution dated
January 28, 2014 appointing a panel of three accounting firms. The dispositive portion of the
Resolution provides:
WHEREFORE, premises considered, the following persons/entities are hereby APPOINTED as
members of the panel tasked to conduct the special audit as ordered by the Court in Our July 5,
2011 Decision, viz.:

1. Ocampo, Mendoza, Leong and Lim (OMLL);

2. Ms. Carissa May Pay-Penson, CPA; and

3. Navarro Amper & Co. (Deloitte)

The panel shall DETERMINE the legitimate corporate expenses incurred by HLI from the
respective dates of receipt by HLI of the payments for the properties until Our July 5, 2011
Decision became final and executory, which expenses shall be deducted from the
PhP1,330,511,500 proceeds of the sale of the 580.51 hectare HLI property.

The panel is hereby given a period of ninety (90) days to complete the audit.

Upon completion of the special audit, the panel shall immediately SUBMIT to the Court its
report/recommendation thereon.

The cost of the audit shall be shouldered by HLI.

The audit panel was appointed to determine if the P1,330,511,500 proceeds of the sale of the lots
were actually used or spent for legitimate corporate purposes by HLI. Given that, as previously
stated, any unspent or unused balance and any disallowed expenditures as determined by the
panel shall be distributed to the 6,296 FWBs. Essentially, to arrive at what shall be deemed the
unspent or unused balance of the sales proceeds, the following are to be deducted therefrom:

1. 3% of the proceeds that were already paid to the FWBs;

2. tax expenses relating to the transfer of titles to the transferees; and

3. expenditures incurred by the Company for legitimate corporate expenses.

As to the meaning of the term "legitimate corporate expenses," the Court's January 28, 2014
Resolution likewise clarified it by referring to the definition of "ordinary and necessary
expenses" used for taxation purposes, viz:
As regards the meaning of "legitimate corporate expenses," We refer to the definition of
"ordinary and necessary expenses" used for taxation purposes. Thus:
Ordinarily, an expense will be considered 'necessary' where the expenditure is appropriate and
helpful in the development of the taxpayer's business. It is 'ordinary' when it connotes a payment
which is normal in relation to the business of the taxpayer and the surrounding circumstances.
The term 'ordinary' does not require that the payments be habitual or normal in the sense that the
same taxpayer will have to make them often; the payment may be unique or non-recurring to the
particular taxpayer affected.

x x x Assuming that the expenditure is ordinary and necessary in the operation of the taxpayer's
business, the answer to the question as to whether the expenditure is an allowable deduction as a
business expense must be determined from the nature of the expenditure itself, which in turn
depends on the extent and permanency of the work accomplished by the expenditure.
On September 13, 2016, for the apparent lack of interest of the accounting firm OMLL, the
Court resolved to appoint Reyes Tacandong & Co. (RT&Co.) as a member of the audit panel. In
the same Resolution, the Court ordered that the audit panel shall, by a majority vote, decide on
the matters pertaining to the conduct of the audit and to submit a monthly report of their audit
and a Final Report on or before the lapse of the ninety (90)-day period.

Per its reports, the audit panel convened on April 19, 2017 and agreed on the following matters:

1. A common scope of work, work program, process, workflow and client

participation list;

2. Each member of the audit panel shall perform the procedures agreed upon
independently and shall therefore issue a separate report based on the procedures
performed;4 and

3. Other matters including communication protocols, engagement timeline and

reporting requirements.5

REYES TACANDONG & CO.'S FINAL REPORT

By September 15, 2017, RT&Co. submitted its Final Report and summarized its findings with
the following table:
 Inputs Amount  
       
Proceeds from sale of land:      
Sale to LRC   P500,000,000  
Sale to LIPCO   750,000,000  
Sale to BCDA   80,511,500  
Total Proceeds   1,330,511,500  
     
Less Disbursements Directly Related to the Sale:    
     
Taxes Related to the sale of parcels of land:    
Sale to LRC    
Sale to LIPCO    
Sale to BCDA   15,000,000  
    44,190,000  
3% share of FWB on the proceeds   4,830,690  
     
    39,915,345  
Net Proceeds after Taxes and 3% Share of FWB   1,226,575,465  
     
Legitimate Corporate Expenses:    
Claimed as deduction in Income Tax Returns P4,309,508,157  
(ITR) (29,746,035)  
Already claimed as disbursements directly related to
4,279,762,122  
the sale above
     
Net Disbursements after Taxes, 3% Share of FWB and
  (3,053,186,657)  
Legitimate Corporate Expenses
     
Revenue from Operations   2,404,396,492  
     
 Net Disbursements   P648,790,165)  
Explaining how it came up with the "legitimate corporate expenses" amounting to
P4,279,762,122, RT&Co. outlined the procedures it adopted and wrote in its Final Report that:
The procedures performed and the results and findings are discussed below: The documents
supporting the results and findings are filed in Annex E.

a. We obtained and summarized the Company's expense claimed as deductions in the ITR for the
fiscal years ended June 30, 1998 to 2011.

We requested copies of the ITR for the fiscal years ended June 30, 1998 to 2011 and were
provided with the ITR for fiscal years ended June 30, 1998, 2003 to 2005 and 2007 to 2011.
Because the ITR for other fiscal years are not available, we referred to the AFS to identify
corporate expenses that are deductible for income tax purposes.

Corporate expenses deducted for income tax purposes totaled P4,309,508,157 for the fiscal years
ended June 30, 1998 to 2011 as follows:
As Disclosed in the ITR and FS Amount
Cost of Sales P2,864,060,868
General and administrative expenses 1,001,102,071
Other charges 714,895,626
Less nondeductible expenses:
Provision for doubtful accounts 216,413,155
Retirement expense 18,990,626
Provision for decline of value of investment 13,500,000
Impairment loss on investment 12,100,000
Interest Expense 1,337,260
Unrealized foreign exchange loss 541,555
Unallowable representation expense 549,800
Nondeductible expense 7,118,012
Total P4,309,508,157
We did not note any exception.

b. We compared the corporate expenses claimed in the ITR against corporate expenses in the
AFS.

We requested and obtained the AFS of the Company for the fiscal years ended June 30, 1998 to
2011. We summarized the expenses reported in the AFS in the periods under consideration.
Furthermore, we compared the expenses reported in the AFS against the corporate expenses
disclosed in the ITR.

We did not note any exception.

c. We assessed if the expense claimed as deductions in the ITR can qualify as legitimate
corporate expenses as defined by the SC.
xxxx

Based on the definition above, all corporate expenses claimed as deductions in the ITR are
therefore qualified as legitimate corporate expenses in computing the net disbursements.

Moreover, we noted that there were taxes related to the sale and 3% FWB share on the proceeds
that were not presented net from the gain on sale and hence, were reported as part of the
corporate expenses. Accordingly, we excluded these from the legitimate corporate expenses as
these have been already claimed as disbursements directly related to the sale. Details are as
follows:
  Amount  
3% share of FWB in the sale - sale to LIPCO and BCDA P24,915,345  
Taxes Related to the sale - sale to LIPCO 4,830,690  
  P29,746,035  
d. We selected legitimate corporate expenses for testing from all disbursements amounting to at
least P100,000 for the fiscal years ended June 30, 1998 to 2011. We vouched these
disbursements to the check vouchers, payable vouchers and source documents. We, further,
determined if the disbursements were cleared by the bank.

Sample Selection

Due to the significant number of transactions in fiscal years 1998 to 2011, we only select
disbursements exceeding P100,000 for vouching. We exc1uded disbursements for the payment
of loans because these do not meet the definition of legitimate corporate expenses.

Matching of Disbursements to Legitimate Corporate Expense Categories

Disbursements vouched relating to legitimate corporate expenses aggregated P3,563,879,525.

We checked the account classification against entries in the subsidiary ledgers. Disbursements
which we cannot check the account classification because the subsidiary ledgers are not
available, were classified to a legitimate expense account based on the nature of the
disbursements.

Legitimate corporate expense vouched according to expense account classification are as

follows:
  Per ITR and FS Amounts vouched % Vouched
Cost of Sales
Planting and cultivating P1,290,138,754 P1,206,950,253 93.55%
Barrio administration 782,383,405 748,219,960 95.63%
Harvesting and transport 434,854,199 350,658,061 80.64%
Trash operations 143,956,890 101,097,725 70.23%
Production share 72,088,656 62,002,546 86.01%
Aquaculture 64,130,160 43,504,402 67.84%
Others 32,602,833 28,414,769 87.15%
  2,820,154,897 2,540,847,716 90.10%
General and Administrative
Expenses 684,560,618 501,818,738 73.31%
General administration 29,285,219 29,114,074 99.42%
Equipment group 44,508,278 43,442,688 97.61%
services   
Farm administration
  758,354,115 574,375,500 75.74%
Other charges
Interest expense 692,894,152 448,656,309 64.75%
Bank charges 8,358,958 -- 0.00%
  701,253,110 448,656,309 63.98%
Total P4,279,762,122 P3,563,879,525 83.27%
The nature of the legitimate corporate expenses vouched is as follows:
Nature Amount Vouched % of Total
Payroll P1,190,119,697 33.39%
Materials and 1,086,855,792 30.50%
supplies 446,719,470 12.53%
Interest payments 420,799,589 11.81%
Employee benefits 87,671,132 2.46%
Taxes and licenses 70,220,924 1.97%
Tractor services 62,002,546 1.74%
Production share 19,588,005 0.55%
Medical expense 17,323,395 0.49%
Retrenchment pay 16,489,576 0.46%
Hauling services 10,701,165 0.30%
Insurance 10,399,074 0.29%
Cutting and loading service 8,884,496 0.25%
Utilities 8,333,315 0.23%
Professional fees 8,307,484 0.23%
School bus allowance 99,463,865 2.79%
Others
Total P3,563,879,525 100.00%
Classification of Source Documents

We classified the vouched legitimate corporate expenses according to source documents as

follows:
 i. Payroll registers - internally-generated report that serves as the primary document
supporting the salaries of the farmworkers.

ii. Third Party Documents - external source documents issued by third-party

suppliers, including but not limited to official receipts, invoices and statements of
account.

iii. Accounting Documents and Other Internal Accounting Records - disbursements

are classified to this category if the supporting documents are merely check
vouchers, payable vouchers, request for payment and/or internally generated
document, other than payroll registers.

Results of our testing are as follows:

VOUCHED TOTAL
LEGITIMAT
    E
CORPORAT
E EXPENSES
Third Party
Payroll Accounting TOTAL
  Source  
Registers Documents VOUCHED
Documents
Cost of Sale
Planting and
Cultivating
Barrio
administration
Harvesting and P216,404,74 P1,206,950,25 P1,290,138,75
transport P401,192,257 7 P589,353,249 3 4
Trash 216,796,327 44,059,480 487,364,153 748,219,960 782,383,405
operations 273,433,975 3,561,892 73,662,194 350,658,061 434,854,199
Production 31,193,494 6,993,319 62,910,912 101,097,725 143,956,890
share 21,906,427 - 40,096,119 62,002,546 72,088,656
Aquaculture 9,274,072 6,206,776 28,023,554 43,504,402 64,130,160
Others 2,508,561 2,432,057 23,474,151 28,414,769 32,602,833
  956,305,113 279,658,271 1,304,884,332 2,540,847,716
General and 48,626,016 119,932,566 333,260,156 501,818,738 684,560,618
Administrativ 35,520,525 216,416 7,705,747 43,442,688 44,508,278
e 19,548,307 511,407 9,054,360 29,114,074 29,285,219
General and
administration
Equipment
Group
Services
Farm
Administration
  103,694,848 120,660,389 350,020,263 574,375,500 758,354,115
Other
Charges
Interest
Expense -- 368,952,229 79,704,080 448,656,309 692,894,152
Bank Charges -- -- -- -- 8,358,958
  -- 368,952,229 79,704,080 448,656,309 701,253,110
P1,059,999,96 P769,270,88 P1,734,608,67 P3,563,879,52 P4,279,762,12
Total
1 9 5 5 2
Source documents tested were original copies and duly signed and approved by the appropriate
parties.

Tracing to Bank Statements

Summary of the bank transactions for the fiscal years ended June 30, 1998 to 2011 are available
only for the Company's bank accounts in United Coconut Planters Bank (UCPB)-Tarlac and
Makati Branches and Metrobank-Makati Branch. However, the summary of the bank
transactions for the Metrobank account was only received in September 6, 2017 and was
excluded in the tracing.

We traced the legitimate corporate expense vouched to the bank statements. Results are as
follows:
Legitimate Corporate Expense Traced to Bank
 
Vouched Statements
Cost of Sales
Planting and cultivating P1,206,950,253 P444,459,041
Barrio administration 748,219,960 341,767,266
Harvesting and transport 350,658,061 211,889,577
Trash Operations 101,097,725 50,221,885
Production share 62,002,546 59,628,754
Aquaculture 43,504,402 16,869,453
Others 28,414,769 10,793,830
  2,540,847,716 1,135,629,806
General and
Administrative
501,818,738 164,656,037
General and administration
43,442,688 26,522,736
Equipment Group Services
29,114,074 19,164,614
Farm Administration
  574,375,500 210,343,387
Other Charges
Interest Expense 448,656,309 108,501,409
Bank Charges -- --
  448,656,309 108,501,409
Total P3,563,879,525 P1,454,474,602
% to Total 100.00% 40.81%
Moreover, legitimate corporate expenses vouched to internal accounting documents and records
only, were traced to the bank statements as disbursements. Results are as follows:
Legitimate Corporate Expense Vouched to
Traced to Bank
  Internal Accounting Records and Documents
Statements
Only
Cost of Sales
Planting and
cultivating P589,353,249 P174,640,533
Barrio administration 487,364.153 93,804,398
Harvesting and 73,662,194 53,730,554
transport 62,910,912 28,471,959
Trash Operations 40,096,119 20,968,280
Production share 28,023,554 10,295,250
Aquaculture 23,474,151 7,298,910
Others
  1,304,884,332 P489,209,884
General and
Administrative
General and
333,260,156 229,998,878
administration
9,054,360 6,667,435
Equipment Group
7,705,747 7,606,665
Services
Farm Administration
  350,020,263 244,272,978
Other Charges
Interest Expense 79,704,080 43,752,879
Bank Charges -- --
  79,704,080 43,752,879
Total P1,734,608,675 P777,235,741
% to Total 100.00% 44.81%
e. We obtained a listing of all expenses for fiscal years 1998 to 2011 from the various registers
and agreed the amounts in the listing with the AFS.
We were not provided a listing of all expenses for fiscal years 1998 to 2011. In lieu of the listing,
we were provided with the monthly subsidiary ledgers in the periods under consideration.

We summarized the monthly subsidiary ledgers for the fiscal years ended June 30, 1998 to 2011
and agreed the summarized expenses with the amounts reflected in the AFS. We noted
differences aggregating to P37.3 million for the fiscal years ended June 30, 2007 and 2008. The
differences were attributed to audit adjustments not posted in the Company's books of accounts.

f. We summarized expenses incurred by CHI by vouching to the AFS.

The following are the expenses incurred for the fiscal years 1998 to 2011.
  Amount
Taxes and Licenses P10,126,103
Pre-operating expenses 1,199,097
Professional fees 91,500
Transportation and travel 13,748
Others 38,257
  P11,468,705
We were not able to obtain documents supporting the abovementioned expenses and thus, we
cannot ascertain their validity.
NAVARRO AMPER & CO.'S FINAL REPORT

On September 18, 2017, the Court received the Final Report of NA&Co. The figure of
P1,710,494,333 appears to represent the legitimate corporate expenses of petitioner HLI for the
fiscal years relevant to the case. NA&Co. summarized its findings, thusly:
Note [d] - Legitimate Corporate Expense

Procedures Performed

As discussed under Section I (C), there was no separate and specific accounting and
identification of expenses to which the proceeds from the sale of land properties were used.
Following the Supreme Court's resolution deducting the legitimate corporate expenses from the
proceeds, we asked the company to provide us with the schedule of those expenses. In the
absence of the schedule, we then followed the procedures we planned (which was agreed by the
Panel) to identify the legitimate corporate expenses considering the definition of the Supreme
Court of the "legitimate corporate expenses".

Accordingly, we obtained from the Company all relevant accounting records such as cash
vouchers, payable vouchers, journal vouchers, cash book records, subsidiary ledgers, general
ledgers and other related attachments thereto, covering the period of the Engagement.

To the extent possible, we selected, traced and sighted the expense amounts from the cash books
to check vouchers, payable vouchers and related attachments thereto, as well to the bank
statements.
We also traced the transactions to the related subsidiary ledger, then subsidiary ledger total to the
general ledger and ultimately to the financial statements and income tax returns of the periods
covered by the Engagement.

Summary Results and Findings

Based on the procedures performed, the total legitimate corporate expenses sighted and traced
through the supporting documents amounted to P1,710,494,333 as summarized below:
TYPE OF DOCUMENT Original Photocopy Total
External Documents
Third Party P79,887,529 P96,750,835 P176,638,364
Internal Documents
Payroll Register 942,015,426 60,942,020 1,002,957,446
Payable Voucher 61,952,958 10,490,201 72,443,159
Request for Payment/Petty Cash
Voucher 160,654,199 21,427,804 182,082,003
Transactions Summary 219,345,895 40,298,935 259,644,830
Material Receipt 341,316 17,229 358,545
Internal Invoice 15,844,630 252,356 16,369,986
Subtotal 1,400,154,424 133,701,545 1,533,855,969
Total P1,480 041,953 P230,452,380 P1,710,494,333
Percentage of Amount:
traced to bank statements 82.84% 46.30% 77.92%
not traced to bank statements 17.16% 53.70% 22.08%
Total 100.00% 100.00% 100.00
In performing the above procedures, we were able to trace and note payment of liabilities which
may represent payment for accounts payable and accrued expenses. However, we were not able
to verify the actual expense accounts charged when the liabilities and the accruals were recorded
due to the following reasons:

a. Multiple invoices are paid in lump - It is difficult to trace the transactions to the
ledgers/journal vouchers since there is no unique referencing; thus, it was
impracticable to trace the liabilities to the underlying expense accounts.

b. Hospital bills - There are voluminous transactions with small amounts; hence,
making it impracticable to trace;

c. Absence of subsidiary ledgers which would allow us to trace the recording of the
expense.

Hence, we have not included those payments amounting to Php3,767,874,734 in the amount of
legitimate corporate expenses presented as sighted and traced.
xxxx
Taking into account the amount of P1,710,494,333, as the legitimate corporate expenses of
petitioner HLI, and all other amounts that shall be deducted from the proceeds of the sales per
this Court's Decision, NA&Co. calculated what may be disbursed to the FWBs in the following
manner:
  External Documents Internal Documents
Note Total Original Photocopy Original Photocopy
[a] PROCEEDS
FROM THE  
SALE
LRC P500,000,00 P500,000,0 P- P- P-
LIPCO 0 00 750,000,00 - -
BCDA 750,000,000 -- 0 - -
80,511,500 25,680,810 54,830,690
1,330,511,50 525,680,81 804,830,69
  - -
0 0 0
LESS
DISBURSEMENT
S
[b] 3% Share of
39,709,309 39,709,309 -
FWBs
[c] Taxes Related to
land sold to:
LRC 18,750,000 15,000,000 3,750,000 - -
LIPCO 55,440,000 46,440,000 9,000,000 - -
BCDA 4,830,690 -- 4,830,690 - -
  79,020,690 61,440,000 17,580,690 - -
Subtotal 118,729,999 61,440,000 17,580,690 39,709 309 -
 
[d] Legitimate
1,710,494,33
Corporate 79,887,529 96,750,835 1,400,154,424 133,701,545
3
Expenses
1,829,224,33 141,327,52 114,331,52
Total Expenses 1,439,863,733 133,701,545
0 9 5
 
NET PROCEEDS (P498,712,83 P384,353,2 P690,499,1 (P1,439,863,7 (P133,701,54
 (DISBURSEMEN 0) 81 65 33) 5)
TS)
CARISSA MAY PAY-PENSON'S FINAL REPORT

Pay-Penson who was nominated by the movants to be a member of the audit panel submitted her
Final Report on September 29, 2017. In tabular form, she summarized her findings as follows:
Document Grading Total in PHP

AA A BB B
(External (External (Internal (Internal
documents documents and documents documents
  and disbursement and and
disbursement not traced disbursement disbursement
traced through bank traced traced not
through bank statements) through bank through bank
statements)   statements) statements)
    1,330,511,500 1,330,511,500
   
Taxes and
  -79,020,462 -79,020,690
Expenses
3% Share of
  -34,740,462 -34,740,462
FWBs
TOTAL
  1,216,750,348 1,216,750,348
PROCEEDS

Legitimate
Corporate AA A BB B Total in PHP
Expenses
Cost of Growing
83,381 145,299,091 368,974,416 503,093,071 1,017,449,959
Crops
Irrigation and
1,954,873 2,470,758 243,871,435 22,887,894 271,184,960
Drainage
Planting and
2,457,132 91,023,881 55,928,765 27,069,669 176,479,447
Cultivating Costs
Barrio
763,170 4,899,381 102,311,272 22,956,548 130,930,371
Administration
Inventories - - 11,934,053 -- 86,718,142 98,652,195
Trash Operations 199,599 559,671 33,236,326 2,751,342 36,746,938
Aquaculture 1,065,809 2,364,181 4,196,433 2,215,570 9,841,993
Indirect Expenses -- 506,810 -- 1,491,949 1,998,759
General and
4,144,785 20,098,187 80,422,156 132,119,132 236,784,260
Administrative
  10,668,749 279,156,013 888,940,803 801,303,317 1,980,068,882
To sum up, all three members of the audit panel have determined that the legitimate corporate
expenses of HLI for the years 1998 up to 2011, coupled with the taxes and expenses related to
the sale and the 3% share already distributed to the FWBs, far exceed the proceeds of the sale of
the adverted 580.51-hectare lot. In net effect, there is no longer any unspent or unused balance of
the sales proceeds available for distribution.

WHEREFORE, premises considered, the July 5, 2011 Decision and November 22, 2011
Resolution of the Court insofar as it directed that "any unspent or unused balance and any
disallowed expenditures as determined by the audit shall be distributed to the 6,296 original
FWBs" are considered FULLY COMPLIED WITH.

SO ORDERED.

G.R. No. 192926 : November 15, 2011

ATTY. ELIAS OMAR A. SANA, Petitioner, v. CAREER EXECUTIVE SERVICE

BOARD, Respondent.
 DECISION

CARPIO, J.:

Before the Court is a petition for certiorari and prohibition assailing Executive Order No. 883,
series of 2010 (EO 883),1 which granted Career Executive Service Officer (CESO) rank to
eligible lawyers in the executive branch, and a related administrative issuance, Career Executive
Service Board (CESB) Resolution No. 870,2 for violating Section 15, Article VII of the
Constitution.

The Facts

On 28 May 2010, President Gloria Macapagal-Arroyo (President Arroyo) issued EO 883

granting the rank of CESO III or higher to officers and employees “occupying legal positions in
the government executive service who have obtained graduate degrees in law and successfully
passed the bar examinations” (Section 1). 3 EO 883 invoked the granting of CESO “rank to
government personnel who successfully complete certain graduate programs, such as Masters in
Public Safety Administration (MPSA) and Masters in National Security Administration
(MNSA)” as basis for the granting of CESO rank to government lawyers in the executive
service.4

On 2 June 2010, the CESB issued Resolution No. 870 finding no legal impediment for the
President to vest CESO rank to executive officials during the periods covered by the
constitutional ban on midnight appointment and statutory ban on pre-election appointment.5
CESB Resolution No. 870 reasoned: chanroblesvirtuallawlibrary

1. In its legal sense, appointment to a position pertains to selection, by the authority vested with
the power, of an individual who is to exercise the functions of a given office.

2. Appointment to a CES rank cannot properly be deemed synonymous to an appointment to a

position in the legal sense for it is merely a completion of a previous appointment and does not
entail the conferment of an authority to exercise the functions of an office.

3. In the CES concept, the word ‘appoint’ means a step in the bestowal of a CES rank, to which
one is entitled after having complied with all the requirements prescribed by the CESB.6

xxx

The CESB subsequently endorsed to President Arroyo its recommendation to vest CESO rank to
13 officials from various departments and agencies, including three members of the CESB who
signed CESB Resolution No. 870.7 On 10 June 2010, President Arroyo appointed the 13 officials
to varying CESO ranks.8

On 30 July 2010, President Benigno S. Aquino III (President Aquino) issued EO 3 expressly
revoking EO 883 (Section 1) and “[a] ll x x x administrative orders, proclamations, rules and
regulations” that conflict with EO 3 (Section 2). As basis for the repeal, the fifth “Whereas”
clause of EO 3 provides that “EO 883 encroaches upon the power of the CESB to ‘promulgate
rules, standards and procedures on the selection, classification, compensation and career
development of members of the Career Executive service x x x’ vested by law with the [CESB] x
x x.”9

On 4 August 2010, petitioner Atty. Elias Omar A. Sana (petitioner) filed the present petition,
contending that EO 883 and the subsequent appointment of the 13 executive officials to CESO
rank are void for violating the constitutional ban on midnight appointment under Section 15,
Article VII of the Constitution.10 Petitioner theorizes that appointments to positions and ranks in
the CES are “executive” in nature and, if made within the period provided under Section 15,
Article VII, fall under its prohibition. Petitioner submits that CESB Resolution No. 870
circumvents Section 15, Article VII by distinguishing the terms “appoint” and “appointment.”
He contends that CESB Resolution No. 870 cannot give new meaning to presidential issuances,
laws, and the Constitution.11

In its Comment, the CESB prays for the dismissal of the petition as the issue it raises was
rendered moot by EO 3’s revocation of EO 883. Alternatively, the CESB defends the vesting of
CESO rank to the 13 officials based on an opinion given by Atty. Ferdinand Rafanan (Rafanan),
head of the Commission on Elections (COMELEC) Law Department,12 that “the appointment to
a CES[O] rank is not equivalent to an appointment to an office since the latter entails the
conferment of an authority to exercise the functions of an office whereas the former is merely a
completion of a previous appointment.” Rafanan further opined that such vesting of CESO rank
is valid because it “does not contemplate any hiring or appointment since it involves only the
conferment of a rank rather than a selection for a position.”13

The CESB agrees with Rafanan’s view, invoking Article IV, Part III, paragraph (c) of the
Integrated Reorganization Plan (IRP), which states that “[a] ppointment to appropriate classes in
the Career Executive Service shall be made by the President from a list of career executive
eligibles recommended by the Board. Such appointments shall be made on the basis of rank.”
Nevertheless, the CESB submits that the grant of CESO rank III or higher to lawyers in the
executive service under EO 883 is “not automatic” because this needs prior guidelines from the
CESB. The CESB points out that President Arroyo did not confer CESO rank to any official
based on EO 883.14

For its part, the Office of the Solicitor General (OSG), while disclaiming any authorization for
the CESB to file its separate Comment, joins causes with the latter in praying for the dismissal of
the petition for mootness. The OSG contends that President Aquino’s issuance of EO 3 revoking
EO 883 moots the issue on the latter’s validity. The OSG arrives at the same conclusion on the
issue of the validity of the appointment of the 13 officials to CESO rank in light of the CESB’s
resubmission to President Aquino of its recommendation for the vesting of CESO rank to the
same officials.15

Alternatively, the OSG argues that EO 883 is unconstitutional for being violative of Section 15,
Article VII of the Constitution. The OSG adds that even if EO 883 is valid, it does not
automatically confer CESO rank to lawyers holding CES positions.16
 The Court’s Ruling

We dismiss the petition on the threshold ground of mootness.

The petition seeks a review of the constitutionality of EO 883 and CESB Resolution No. 870 for
being repugnant to Section 15, Article VII of the Constitution. At the time this petition was filed,
however, President Aquino had already issued EO 3 revoking EO 883 expressly (under Section
1) and CESB Resolution No. 870 impliedly (under Section 2). EO 883 and CESB Resolution No.
870 having ceased to have any force and effect, the Court finds no reason to reach the merits of
the petition and pass upon these issuances’ validity. To do so would transgress the requirement
of case and controversy as precondition for the Court’s exercise of judicial review.

True, this Court had relaxed the case and controversy requirement to resolve moot issues. In
those instances, however, the issues presented were grounded on peculiar set of facts giving rise
to important constitutional questions capable of repetition yet evading review17 or indicating
intent on the part of potential or actual parties to place a constitutional question beyond the ambit
of judicial review by performing acts rendering moot an incipient or pending justiciable
controversy.18

These factors do not obtain here. The question whether an appointment to a CESO rank of an
executive official amounts to an “appointment” for purposes of the constitutional ban on
midnight appointment, while potentially recurring, holds no certainty of evading judicial review
as the question can be decided even beyond the appointments-ban period under Section 15,
Article VII of the Constitution.

Indeed, petitioner does not allege to have suffered any violation of a right vested in him under
EO 883. He was not among the 13 officials granted CESO ranking by President Arroyo. The
CESB itself stated that “no conferment of CESO rank was ever made by President [Arroyo] in
relation to EO 883.”19 Hence, for the Court to nevertheless reach the merits of this petition and
determine the constitutionality of EO 883 and CESB Resolution No. 870 despite their
unquestioned repeal and the absence of any resulting prejudice to petitioner’s rights is to depart
from its constitutional role of settling “actual controversies involving rights which are legally
demandable and enforceable.”20

WHEREFORE, we DISMISS the petition.

SO ORDERED.

[G.R. Nos. L-68379-81. September 22, 1986.]

EVELIO B. JAVIER, Petitioner, v. THE COMMISSION ON ELECTIONS, and ARTURO

F. PACIFICADOR, Respondents.

Raul S. Roco and Lorna Patajo-Kapunan for Petitioner.

 SYLLABUS

1. REMEDIAL LAW; DISMISSAL OF ACTION; ISSUES BECAME MOOT AND

ACADEMIC; NOT A CASE OF. — The abolition of the Batasang Pambansa and the
disappearance of the office in dispute between the petitioner and the private respondent — both
of whom have gone their separate ways — could be a convenient justification for dismissing this
case. But there are larger issues involved that must be resolved now, once and for all, not only to
dispel the legal ambiguities here raised. The more important purpose is to manifest in the clearest
possible terms that this Court will not disregard and in effect condone wrong on the simplistic
and tolerant pretext that the case has become moot and academic. The Supreme Court is not only
the highest arbiter of legal questions but also the conscience of the government. The citizen
comes to us in quest of law but we must also give him justice. The two are not always the same.
There are times when we cannot grant the latter because the issue has been settled and decision is
no longer possible according to the law. But there are also times when although the dispute has
disappeared, as in this case, it nevertheless cries out to be resolved. Justice demands that we act
then, not only for the vindication of the outraged right, though gone, but also for the guidance of
and as a restraint upon the future.

2. CONSTITUTIONAL LAW; COMMISSION ON ELECTIONS; GIVEN FULL AUTHORITY

TO HEAR AND DECIDE CASES FROM BEGINNING TO END AND ALL MATTERS
RELATED THERETO. — We believe that in making the Commission on Elections the sole
judge of all contests involving the election, returns and qualifications of the members of the
Batasang Pambansa and elective provincial and city officials, the Constitution intended to give it
full authority to hear and decide these cases from beginning to end and on all matters related
thereto, including those arising before the proclamation of the winners.
DECISION

CRUZ, J.:

The new Solicitor General has moved to dismiss this petition on the ground that as a result of
supervening events it has become moot and academic. It is not as simple as that, Several lives
have been lost in connection with this case, including that of the petitioner himself. The private
respondent is now in hiding. The purity of suffrage has been defiled and the popular will scorned
through a confabulation of those in authority. This Court cannot keep silent in the face of these
terrible facts. The motion is denied.

The petitioner and the private respondent were candidates in Antique for the Batasang Pambansa
in the May 1984 elections. The former appeared to enjoy more popular support but the latter had
the advantage of being the nominee of the KBL with all its perquisites of power. On May 13,
1984, the eve of the elections, the bitter contest between the two came to a head when several
followers of the petitioner were ambushed and killed, allegedly by the latter’s men. Seven
suspects, including respondent Pacificador, are now facing trial for these murders. The incident
naturally heightened tension in the province and sharpened the climate of fear among the
electorate. Conceivably, it intimidated voters against supporting the Opposition candidate or into
supporting the candidate of the ruling party.

It was in this atmosphere that the voting was held, and the post-election developments were to
run true to form. Owing to what he claimed were attempts to railroad the private respondent’s
proclamation, the petitioner went to the Commission on Elections to question the canvass of the
election returns. His complaints were dismissed and the private respondent was proclaimed
winner by the Second Division of the said body. The petitioner thereupon came to this Court,
arguing that the proclamation was void because made only by a division and not by the
Commission on Elections en banc as required by the Constitution. Meanwhile, on the strength of
his proclamation, the private respondent took his oath as a member of the Batasang Pambansa.

The case was still being considered by this Court when on February 11, 1986, the petitioner was
gunned down in cold blood and in broad daylight. The nation, already indignant over the obvious
manipulation of the presidential elections in favor of Marcos, was revolted by the killing, which
flaunted a scornful disregard for the law by the assailants who apparently believed they were
above the law. This ruthless murder was possibly one of the factors that strengthened the cause
of the Opposition in the February revolution that toppled the Marcos regime and installed the
present government under President Corazon C. Aquino.

The abolition of the Batasang Pambansa and the disappearance of the office in dispute between
the petitioner and the private respondent — both of whom have gone their separate ways —
could be a convenient justification for dismissing this case. But there are larger issues involved
that must be resolved now, once and for all, not only to dispel the legal ambiguities here raised.
The more important purpose is to manifest in the clearest possible terms that this Court will not
disregard and in effect condone wrong on the simplistic and tolerant pretext that the case has
become moot and academic.

The Supreme Court is not only the highest arbiter of legal questions but also the conscience of
the government. The citizen comes to us in quest of law but we must also give him justice. The
two are not always the same. There are times when we cannot grant the latter because the issue
has been settled and decision is no longer possible according to the law. But there are also times
when although the dispute has disappeared, as in this case, it nevertheless cries out to be
resolved. Justice demands that we act then, not only for the vindication of the outraged right,
though gone, but also for the guidance of and as a restraint upon the future.

It is a notorious fact decried by many people and even by the foreign press that elections during
the period of the Marcos dictatorship were in the main a desecration of the right of suffrage.
Vote-buying, intimidation and violence, illegal listing of voters, falsified returns, and other
elections anomalies misrepresented and vitiated the popular will and led to the induction in office
of persons who did not enjoy the confidence of the sovereign electorate. Genuine elections were
a rarity. The price at times was human lives. The rule was chicanery and irregularity, and on all
levels of the polls, from the barangay to the presidential. This included the rigged plebiscites and
referenda that also elicited the decision and provoked the resentments of the people.

Antique in 1984 hewed to the line and equaled if it did not surpass the viciousness of elections in
other provinces dominated by the KBL. Terrorism was a special feature, as demonstrated by the
killings previously mentioned, which victimized no less than one of the main protagonists and
implicated his rival as a principal perpetrator. Opposition leaders were in constant peril of their
lives even as their supporters were gripped with fear of violence at the hands of the party in
power. chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph

What made the situation especially deplorable was the apparently indifferent attitude of the
Commission on Elections toward the anomalies being committed. It is a matter of record that the
petitioner complained against the terroristic acts of his opponents. All the electoral body did was
refer the matter to the Armed Forces without taking a more active step as befitted its
constitutional role as the guardian of free, orderly and honest elections. A more assertive stance
could have averted the Sibalom election eve massacre and saved the lives of the nine victims of
the tragedy.

Public confidence in the Commission on Elections was practically nil because of its transparent
bias in favor of the administration. This prejudice left many opposition candidates without
recourse except only to this Court.

Alleging serious anomalies in the conduct of the elections and the canvass of the election returns,
the petitioner went to the Commission on Elections to prevent the impending proclamation of his
rival, the private respondent herein. 1 Specifically, the petitioner charged that the elections were
marred by "massive terrorism, intimidation, duress, vote-buying, fraud, tampering and
falsification of election returns under duress, threat and intimidation, snatching of ballot boxes
perpetrated by the armed men of respondent Pacificador." 2 Particular mention was made of the
municipalities of Caluya, Cabate, Tibiao, Barbaza, Laua-an, and also of San Remigio, where the
petitioner claimed the election returns were not placed in the ballot boxes but merely wrapped in
cement bags or manila paper.

On May 18, 1984, the Second Division of the Commission on Elections directed the provincial
board of canvassers of Antique to proceed with the canvass but to suspend the proclamation of
the winning candidate until further orders. 3 On June 7, 1984, the same Second Division ordered
the board to immediately convene and to proclaim the winner without prejudice to the outcome
of the case before the Commission. 4 On certiorari before this Court, the proclamation made by
the board of canvassers was set aside as premature, having been made before the lapse of the 5-
day period of appeal, which the petitioner had seasonably made. 5 Finally, on July 23, 1984, the
Second Division promulgated the decision now subject of this petition which inter alia
proclaimed Arturo F. Pacificador the elected assemblyman of the province of Antique. 6

This decision was signed by Chairman Victoriano Savellano and Commissioners Jaime Opinion
and Froilan M. Bacungan. Previously asked to inhibit himself on the ground that he was a former
law partner of private respondent Pacificador, Opinion had refused. 7

The petitioner then came to this Court, asking us to annul the said decision.

The core question in this case is one of jurisdiction, to wit: Was the Second Division of the
Commission on Elections authorized to promulgate its decision of July 23, 1984, proclaiming the
private respondent the winner in the election? chanrobles.com:cralaw:red
The applicable provisions are found in Article XII-C, Sections 2 and 3, of the 1973 Constitution.

Section 2 confers on the Commission on Elections the power to: jgc:chanrobles.com.ph

"(2) Be the sole judge of all contests relating to the election, returns and qualifications of all
member of the Batasang Pambansa and elective provincial and city officials." cralaw virtua1aw library

Section 3 provides: jgc:chanrobles.com.ph

"The Commission on Elections may sit en banc or in three divisions. All election cases may be
heard and decided by divisions except contests involving members of the Batasang Pambansa,
which shall be heard and decided en banc. Unless otherwise provided by law, all election cases
shall be decided within ninety days from the date of their submission for decision." cralaw virtua1aw library

While both invoking the above provisions, the petitioner and the respondents have arrived at
opposite conclusions. The records are voluminous and some of the pleadings are exhaustive and
in part even erudite. And well they might be, for the noble profession of the law — despite all
the canards that have been flung against it — exerts all efforts and considers all possible
viewpoints in its earnest search of the truth.

The petitioner complains that the proclamation made by the Second Division is invalid because
all contests involving the members of the Batasang Pambansa come under the jurisdiction of the
Commission on Elections en banc. This is as it should be, he says, to insure a more careful
decision, considering the importance of the offices involved. The respondents, for their part,
argue that only contests need to be heard and decided en banc and all other cases can be — in
fact, should be — filed with and decided only by any of the three divisions.

The former Solicitor General makes much of this argument and lays a plausible distinction
between the terms "contests" and "cases" to prove his point. 8 Simply put, his contention is that
the pre-proclamation controversy between the petitioner and the private respondent was not yet a
contest at that time and therefore could be validly heard by a mere division of the Commission
on Elections, consonant with Section 3. The issue was at this stage still administrative and so was
resoluble by the Commission under its power to administer all laws relative to the conduct of
elections, 9 not its authority as sole judge of the election contest.

A contest, according to him, should involve a contention between the parties for the same office
"in which the contestant seeks not only to oust the intruder but also to have himself inducted into
the office." 10 No proclamation had as yet been made when the petition was filed and later
decided. Hence, since neither the petitioner nor the private respondent had at that time assumed
office, there was no Member of the Batasang Pambansa from Antique whose election, returns or
qualifications could be examined by the Commission on Elections en banc.

In providing that the Commission on Elections could act in division when deciding election
cases, according to this theory, the Constitution was laying down the general rule. The exception
was the election contest involving the members of the Batasang Pambansa, which had to be
heard and decided en banc. 11 The en banc requirement would apply only from the time a
candidate for the Batasang Pambansa was proclaimed as winner, for it was only then that a
contest could be permitted under the law. All matters arising before such time were, necessarily,
subject to decision only by division of the Commission as these would come under the general
heading of "election cases." cralaw virtua1aw library

As the Court sees it, the effect of this interpretation would be to divide the jurisdiction of the
Commission on Elections into two, viz.: (1) over matters arising before the proclamation, which
should be heard and decided by division in the exercise of its administrative power; and (2) over
matters arising after the proclamation, which could be heard and decided only en banc in the
exercise of its judicial power. Stated otherwise, the Commission as a whole could not act as sole
judge as long as one of its divisions was hearing a pre-proclamation matter affecting the
candidates for the Batasang Pambansa because there was as yet no contest; or to put it still
another way, the Commission en banc could not do what one of its divisions was competent to
do, i.e., decide a pre-proclamation controversy. Moreover, a mere division of the Commission on
Elections could hear and decide, save only those involving the election, returns and
qualifications of the members of the Batasang Pambansa, all cases involving elective provincial
and city officials from start to finish, including pre-proclamation controversies and up to the
election protest, In doing so, it would exercise first administrative and then judicial powers. But
in the case of the Commission en banc, its jurisdiction would begin only after the proclamation
was made and a contest was filed and not at any time and on any matter before that, and always
in the exercise only of judicial power.

This interpretation would give to the part more powers than were enjoyed by the whole, granting
to the division while denying to the banc. We do not think this was the intention of the
Constitution. The framers could not have intended such an irrational rule.

We believe that in making the Commission on Elections the sole judge of all contests involving
the election, returns and qualifications of the members of the Batasang Pambansa and elective
provincial and city officials, the Constitution intended to give it full authority to hear and decide
these cases from beginning to end and on all matters related thereto, including those arising
before the proclamation of the winners. chanrobles virtual lawlibrary

It is worth observing that the special procedure for the settlement of what are now called "pre-
proclamation controversies" is a relatively recent innovation in our laws, having been introduced
only in 1978, through P.D. No. 1296, otherwise known as the 1978 Election Code. Section 175
thereof provided: jgc:chanrobles.com.ph

"Sec. 175. Suspension and annulment of proclamation. — The Commission shall be the sole
judge of all pre-proclamation controversies and any of its decisions, orders or rulings shall be
final and executory. It may, motu proprio or upon written petition, and after due notice and
hearing order the suspension of the proclamation of a candidate-elect or annul any proclamation,
if one has been made, on any of the grounds mentioned in Sections 172, 173 and 174 thereof." cralaw virtua1aw library

Before that time all proceedings affecting the election, returns and qualifications of public
officers came under the complete jurisdiction of the competent court or tribunal from beginning
to end and in the exercise of judicial power only. It therefore could not have been the intention of
the framers in 1935, when the Commonwealth Charter was adopted, and even in 1973, when the
past Constitution was imposed, to divide the electoral process into the pre-proclamation stage
and the post-proclamation stage and to provide for a separate jurisdiction for each stage,
considering the first administrative and the second judicial.

Besides, the term "contest" as it was understood at the time Article XII-C, Section 2(2) was
incorporated in the 1973 Constitution did not follow the strict definition of a contention between
the parties for the same office. Under the Election Code of 1971, which presumably was taken
into consideration when the 1973 Constitution was being drafted, election contests included the
quo warranto petition that could be filed by any voter on the ground of disloyalty or ineligibility
of the contestee although such voter was himself not claiming the office involved. 12

The word "contests" should not be given a restrictive meaning; on the contrary, it should receive
the widest possible scope conformably to the rule that the words used in the Constitution should
be interpreted liberally. As employed in the 1973 Constitution, the term should be understood as
referring to any matter involving the title or claim of title to an elective office, made before or
after proclamation of the winner, whether or not the contestant is claiming the office in dispute.
Needless to stress, the term should be given a consistent meaning and understood in the same
sense under both Section 2(2) and Section 3 of Article XII-C of the Constitution.

The phrase "election, returns and qualifications" should be interpreted in its totality as referring
to all matters affecting the validity of the contestee’s title. But if it is necessary to specify, we can
say that "election" referred to the conduct of the polls, including the listing of voters, the holding
of the electoral campaign, and the casting and counting of the votes; "returns" to the canvass of
the returns and the proclamation of the winners, including questions concerning the composition
of the board of canvassers and the authenticity of the election returns; and "qualifications" to
matters that could be raised in a quo warranto proceeding against the proclaimed winner, such as
his disloyalty or ineligibility or the inadequacy of his certificate of candidacy. chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph

All these came under the exclusive jurisdiction of the Commission on Elections insofar as they
applied to the members of the defunct Batasang Pambansa and, under Article XII-C, Section 3,
of the 1973 Constitution, could be heard and decided by it only en banc.

We interpret "cases" as the generic term denoting the actions that might be heard and decided by
the Commission on Elections, only by division as a general rule except where the case was a
"contest" involving members of the Batasang Pambansa, which had to be heard and decided en
banc.

As correctly observed by the petitioner, the purpose of Section 3 in requiring that cases involving
members of the Batasang Pambansa be heard and decided by the Commission en banc was to
insure the most careful consideration of such cases. Obviously, that objective could not be
achieved if the Commission could act en banc only after the proclamation had been made, for it
might then be too late already. We are all-too-familiar with the grab-the-proclamation-and-delay-
the-protest strategy of many unscrupulous candidates which has resulted in the frustration of the
popular will and the virtual defeat of the real winners in the election. The respondent’s theory
would make this gambit possible for the pre-proclamation proceedings, being summary in nature,
could be hastily decided by only three members in division, without the care and deliberation
that would have otherwise been observed by the Commission en banc.

After that, the delay. The Commission en banc might then no longer be able to rectify in time the
proclamation summarily and not very judiciously made by the division. While in the end the
protestant might be sustained, he might find himself with only a Phyrric victory because the term
of his office would have already expired.

It may be argued that in conferring the initial power to decide the pre-proclamation question
upon the division, the Constitution did not intend to prevent the Commission en banc from
exercising the power directly, on the theory that the greater power embraces the lesser. It could if
it wanted to but then it could also allow the division to act for it. That argument would militate
against the purpose of the provision, which precisely limited all questions affecting the election
contest, as distinguished from election cases in general, to the jurisdiction of the Commission en
banc as sole judge thereof. "Sole judge" excluded not only all other tribunals but also and even
the division of the Commission. A decision made on the contest by less than the Commission en
banc would not meet the exacting standard of care and deliberation ordained by the Constitution.

Incidentally, in making the Commission the "sole judge" of pre-proclamation controversies in

Section 175, supra, the law was obviously referring to the body sitting en banc. In fact, the pre-
proclamation controversies involved in Aratuc v. Commission on Elections, 13 where the said
provision was applied, were heard and decided en banc.

Another matter deserving the highest consideration of this Court but accorded cavalier attention
by the respondent Commission on Elections is due process of law, that ancient guaranty of
justice and fair play which is the hallmark of the free society. Commissioner Opinion ignored it.
Asked to inhibit himself on the ground that he was formerly a law partner of the private
respondent, he obstinately insisted on participating in the case, denying he was biased. 14

Given the general attitude of the Commission on Elections toward the party in power at the time,
and the particular relationship between Commissioner Opinion and MP Pacificador, one could
not be at least apprehensive, if not certain, that the decision of the body would be adverse to the
petitioner. As in fact it was. Commissioner Opinion’s refusal to inhibit himself and his objection
to the transfer of the case to another division cannot be justified by any criterion of propriety. His
conduct on this matter belied his wounded protestations of innocence and proved the motives of
the Second Division when it rendered its decision. chanroblesvirtualawlibrary

This Court has repeatedly and consistently demanded "the cold neutrality of an impartial judge"
as the indispensable imperative of due process. 15 To bolster that requirement, we have held that
the judge must not only be impartial but must also appear to be impartial as an added assurance
to the parties that his decision will be just. 16 The litigants are entitled to no less than that. They
should be sure that when their rights are violated they can go to a judge who shall give them
justice. They must trust the judge, otherwise they will not go to him at all. They must believe in
his sense of fairness, otherwise they will not seek his judgment. Without such confidence, there
would be no point in invoking his action for the justice they expect.
Due process is intended to insure that confidence by requiring compliance with what Justice
Frankfurter calls the rudiments of fair play. Fair play calls for equal justice. There cannot be
equal justice where a suitor approaches a court already committed to the other party and with a
judgment already made and waiting only to be formalized after the litigants shall have undergone
the charade of a formal hearing. Judicial (and also extrajudicial) proceedings are not orchestrated
plays in which the parties are supposed to make the motions and reach the denouement according
to a prepared script. There is no writer to foreordain the ending. The judge will reach his
conclusions only after all the evidence is in and all the arguments are filed, on the basis of the
established facts and the pertinent law.

The relationship of the judge with one of the parties may color the facts and distort the law to the
prejudice of a just decision. Where this is probable or even only possible, due process demands
that the judge inhibit himself, if only out of a sense of delicadeza. For like Caesar’s wife, he must
be above suspicion. Commissioner Opinion, being a lawyer, should have recognized his duty and
abided by this well-known rule of judicial conduct. For refusing to do so, he divested the Second
Division of the necessary vote for the questioned decision, assuming it could act, and rendered
the proceeding null and void. 17

Since this case began in 1984, many significant developments have taken place, not the least
significant of which was the February revolution of "people power" that dislodged the past
regime and ended well nigh twenty years of travail for this captive nation. The petitioner is gone,
felled by a hail of bullets sprayed with deadly purpose by assassins whose motive is yet to be
disclosed. The private respondent has disappeared with the "pomp of power" he had before
enjoyed. Even the Batasang Pambansa itself has been abolished, "an iniquitous vestige of the
previous regime" discontinued by the Freedom Constitution. It is so easy now, as has been
suggested not without reason, to send the records of this case to the archives and say the case is
finished and the book is closed.

But not yet.

Let us first say these meager words in tribute to a fallen hero who was struck down in the vigor
of his youth because he dared to speak against tyranny. Where many kept a meekly silence for
fear of retaliation, and still others feigned and fawned in hopes of safety and even reward, he
chose to fight. He was not afraid. Money did not tempt him. Threats did not daunt him. Power
did not awe him. His was a singular and allexacting obsession: the return of freedom to his
country. And though he fought not in the barricades of war amid the sound and smoke of shot
and shell, he was a soldier nonetheless, fighting valiantly for the liberties of his people against
the enemies of his race, unfortunately of his race too, who would impose upon the land a
perpetual night of dark enslavement. He did not see the breaking of the dawn, sad to say, but in a
very real sense Evelio B. Javier made that dawn draw nearer because he was, like Saul and
Jonathan, "swifter than eagles and stronger than lions." cralaw virtua1aw library

A year ago this Court received a letter which began: "I am the sister of the late Justice Calixto
Zaldivar. I am the mother of Rhium Z. Sanchez, the grandmother of Plaridel Sanchez IV and
Aldrich Sanchez, the aunt of Mamerta Zaldivar. I lost all four of them in the election eve ambush
in Antique last year." She pleaded, as so did hundreds of others of her provincemates in separate
signed petitions sent us, for the early resolution of that horrible crime, saying "I am 82 years old
now. I am sick. May I convey to you my prayer in church and my plea to you, ‘Before I die, I
would like to see justice to my son and grandsons,’ May I also add that the people of Antique
have not stopped praying that the true winner of the last elections will be decided upon by the
Supreme Court soon." chanrobles law library : red

That was a year ago and since then a new government has taken over in the wake of the February
revolution. The despot has escaped, and with him, let us pray, all the oppressions and repressions
of the past have also been banished forever. A new spirit is now upon our land. A new vision
limns the horizon. Now we can look forward with new hope that under the Constitution of the
future every Filipino shall be truly sovereign in his own country, able to express his will through
the pristine ballow with only his conscience as his counsel.

This is not an impossible dream. Indeed, it is an approachable goal. It can and will be won if we
are able at last, after our long ordeal, to say never again to tyranny. If we can do this with
courage and conviction, then and only then, and not until then, can we truly say that the case is
finished and the book is closed.

WHEREFORE, let it be spread in the records of this case that were it not for the supervening
events that have legally rendered it moot and academic, this petition would have been granted
and the decision of the Commission on Elections dated July 23, 1984, set aside as violative of the
Constitution.

SO ORDERED.

[G.R. No. 192791 : April 24, 2012]

DENNIS A. B. FUNA, PETITIONER, VS. THE CHAIRMAN, COMMISSION ON

AUDIT, REYNALDO A. VILLAR, RESPONDENT.

DECISION

VELASCO JR., J.:

In this Petition for Certiorari and Prohibition under Rule 65, Dennis A. B. Funa challenges the
constitutionality of the appointment of Reynaldo A. Villar as Chairman of the Commission on
Audit and accordingly prays that a judgment issue “declaring the unconstitutionality” of the
appointment. cralaw

The facts of the case are as follows:

On February 15, 2001, President Gloria Macapagal-Arroyo (President Macapagal-Arroyo)

appointed Guillermo N. Carague (Carague) as Chairman of the Commission on Audit (COA) for
a term of seven (7) years, pursuant to the 1987 Constitution.[1]  Carague’s term of office started
on February 2, 2001 to end on February 2, 2008.

Meanwhile, on February 7, 2004, President Macapagal-Arroyo appointed Reynaldo A. Villar

(Villar) as the third member of the COA for a term of seven (7) years starting February 2, 2004
until February 2, 2011.

Following the retirement of Carague on February 2, 2008 and during the fourth year of Villar as
COA Commissioner, Villar was designated as Acting Chairman of COA from February 4, 2008
to April 14, 2008.  Subsequently, on April 18, 2008, Villar was nominated and appointed as
Chairman of the COA.  Shortly thereafter, on June 11, 2008, the Commission on Appointments
confirmed his appointment.  He was to serve as Chairman of COA, as expressly indicated in the
appointment papers, until the expiration of the original term of his office as COA Commissioner
or on February 2, 2011. Challenged in this recourse, Villar, in an obvious bid to lend color of
title to his hold on the chairmanship, insists that his appointment as COA Chairman accorded
him a fresh term of seven (7) years which is yet to lapse. He would argue, in fine, that his term of
office, as such chairman, is up to February 2, 2015, or 7 years reckoned from February 2, 2008
when he was appointed to that position.

Meanwhile, Evelyn R. San Buenaventura (San Buenaventura) was appointed as COA

Commissioner to serve the unexpired term of Villar as Commissioner or up to February 2, 2011.

Before the Court could resolve this petition, Villar, via a letter dated February 22, 2011
addressed to President Benigno S. Aquino III, signified his intention to step down from office
upon the appointment of his replacement. True to his word, Villar vacated his position when
President Benigno Simeon Aquino III named Ma. Gracia Pulido-Tan (Chairman Tan) COA
Chairman. This development has rendered this petition and the main issue tendered therein moot
and academic.

A case is considered moot and academic when its purpose has become stale,[2] or when it ceases
to present a justiciable controversy owing to the onset of supervening events,[3]  so that a
resolution of the case or a declaration on the issue would be of no practical value or use.[4] In
such instance, there is no actual substantial relief which a petitioner would be entitled to, and
which will anyway be negated by the dismissal of the basic petition.[5]  As a general rule, it is not
within Our charge and function to act upon and decide a moot case.  However, in David v.
Macapagal-Arroyo,[6] We acknowledged and accepted certain exceptions to the issue of
mootness, thus:

The “moot and academic” principle is not a magical formula that can automatically dissuade the
courts in resolving a case. Courts will decide cases, otherwise moot and academic, if: first, there
is a grave violation of the Constitution, second, the exceptional character of the situation and the
paramount public interest is involved, third, when constitutional issue raised requires formulation
of controlling principles to guide the bench, the bar, and the public, and fourth, the case is
capable of repetition yet evading review.

Although deemed moot due to the intervening appointment of Chairman Tan and the resignation
of Villar, We consider the instant case as falling within the requirements for review of a moot
and academic case, since it asserts at least four exceptions to the mootness rule discussed in
David, namely: there is a grave violation of the Constitution; the case involves a situation of
exceptional character and is of paramount public interest; the constitutional issue raised requires
the formulation of controlling principles to guide the bench, the bar and the public; and the case
is capable of repetition yet evading review.[7]   The situation presently obtaining is definitely of
such exceptional nature as to necessarily call for the promulgation of principles that will
henceforth “guide the bench, the bar and the public” should like circumstance arise.  Confusion
in similar future situations would be smoothed out if the contentious issues advanced in the
instant case are resolved straightaway and settled definitely. There are times when although the
dispute has disappeared, as in this case, it nevertheless cries out to be addressed. To borrow from
Javier v. Pacificador,[8] “Justice demands that we act then, not only for the vindication of the
outraged right, though gone, but also for the guidance of and as a restraint in the future.”

Both procedural and substantive issues are raised in this proceeding. The procedural aspect
comes down to the question of whether or not the following requisites for the exercise of judicial
review of an executive act obtain in this petition, viz: (1) there must be an actual case or
justiciable controversy before the court; (2) the question before it must be ripe for adjudication;
(3) the person challenging the act must be a proper party; and (4) the issue of constitutionality
must be raised at the earliest opportunity and must be the very litis mota of the case.[9]

To Villar, all the requisites have not been met, it being alleged in particular that petitioner, suing
as a taxpayer and citizen, lacks the necessary standing to challenge his appointment.[10]  On the
other hand, the Office of the Solicitor General (OSG), while recognizing the validity of Villar’s
appointment for the period ending February 11, 2011, has expressed the view that petitioner
should have had filed a petition for declaratory relief or quo warranto under Rule 63 or Rule 66,
respectively, of the Rules of Court instead of certiorari under Rule 65.

Villar’s posture on the absence of some of the mandatory requisites for the exercise by the Court
of its power of judicial review must fail.  As a general rule, a petitioner must have the necessary
personality or standing (locus standi) before a court will recognize the issues presented.  In
Integrated Bar of the Philippines v. Zamora, We defined locus standi as:

x x x a personal and substantial interest in the case such that the party has sustained or will
sustain a direct injury as a result of the governmental act that is being challenged.  The term
“interest” means a material interest, an interest in issue affected by the decree, as distinguished
from mere interest in the question involved, or a mere incidental interest.  The gist of the
question of standing is whether a party alleges “such personal stake in the outcome of the
controversy as to assure the concrete adverseness which sharpens the presentation of issues upon
which the court depends for illumination of difficult constitutional questions.”[11]

To have legal standing, therefore, a suitor must show that he has sustained or will sustain a
“direct injury” as a result of a government action, or have a “material interest” in the issue
affected by the challenged official act.[12]  However, the Court has time and again acted liberally
on the locus standi requirements and has accorded certain individuals, not otherwise directly
injured, or with material interest affected, by a Government act, standing to sue provided a
constitutional issue of critical significance is at stake.[13]  The rule on locus standi is after all a
mere procedural technicality in relation to which the Court, in a catena of cases involving a
subject of transcendental import, has waived, or relaxed, thus allowing non- traditional
plaintiffs, such as concerned citizens, taxpayers, voters or legislators, to sue in the public interest,
albeit they may not have been personally injured by the operation of a law or any other
government act.[14]  In David, the Court laid out the bare minimum norm before the so-called
“non-traditional suitors” may be extended standing to sue, thusly:

1.)  For taxpayers, there must be a claim of illegal disbursement of public funds or that the tax
measure is unconstitutional;

2.)  For voters, there must be a showing of obvious interest in the validity of the election law in
question;

3.)  For concerned citizens, there must be a showing that the issues raised are of transcendental
importance which must be settled early; and

4.) For legislators, there must be a claim that the official action complained of infringes their
prerogatives as legislators.

This case before Us is of transcendental importance, since it obviously has “far-reaching

implications,” and there is a need to promulgate rules that will guide the bench, bar, and the
public in future analogous cases. We, thus, assume a liberal stance and allow petitioner to
institute the instant petition.

Anent the aforestated posture of the OSG, there is no serious disagreement as to the propriety of
the availment of certiorari as a medium to inquire on whether the assailed appointment of
respondent Villar as COA Chairman infringed the constitution or was infected with grave abuse
of discretion. For under the expanded concept of judicial review under the 1987 Constitution, the
corrective hand of certiorari may be invoked not only “to settle actual controversies involving
rights which are legally demandable and enforceable,” but also “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.”[15]  “Grave abuse of discretion” denotes:
such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction, or, in
other words, where the power is exercised in an arbitrary or despotic manner by reason of
passion or personal hostility, and it must be so patent and gross as to amount to an evasion of
positive duty or to a virtual refusal to perform the duty enjoined or to act in contemplation of
law.[16]

We find the remedy of certiorari applicable to the instant case in view of the allegation that then
President Macapagal-Arroyo exercised her appointing power in a manner constituting grave
abuse of discretion.

This brings Us to the pivotal substantive issue of whether or not Villar’s appointment as COA
Chairman, while sitting in that body and after having served for four (4) years of his seven (7)
year term as COA commissioner, is valid in light of the term limitations imposed under, and the
circumscribing concepts tucked in, Sec. 1 (2), Art. IX(D) of the Constitution, which reads:

(2) The Chairman and Commissioners [on Audit] shall be appointed by the President with
the consent of the Commission on Appointments for a term of seven years without
reappointment. Of those first appointed, the Chairman shall hold office for seven years, one
commissioner for five years, and the other commissioner for three years, without reappointment.
Appointment to any vacancy shall be only for the unexpired portion of the term of the
predecessor. In no case shall any member be appointed or designated in a temporary or acting
capacity. (Emphasis added.)[17]

And if valid, for how long can he serve?

At once clear from a perusal of the aforequoted provision are the defined restricting features in
the matter of the composition of COA and the appointment of its members (commissioners and
chairman) designed to safeguard the independence and impartiality of the commission as a body
and that of its individual members.[18] These are, first, the rotational plan or the staggering term in
the commission membership, such that the appointment of commission members subsequent to
the original set appointed after the effectivity of the 1987 Constitution shall occur every two
years; second, the maximum but a fixed term-limit of seven (7) years for all commission
members whose appointments came about by reason of the expiration of term save the
aforementioned first set of appointees and those made to fill up vacancies resulting from certain
causes; third, the prohibition against reappointment of commission members who served the full
term of seven years or of members first appointed under the Constitution who served their
respective terms of office; fourth, the limitation of the term of a member to the unexpired portion
of the term of the predecessor; and fifth, the proscription against temporary appointment or
designation.

To elucidate on the mechanics of and the adverted limitations   on the matter of COA-member
appointments with fixed but staggered terms of office, the Court lays down the following
postulates deducible from pertinent constitutional provisions, as construed by the Court:

1.  The terms of office and appointments of the first set of commissioners, or the seven, five and
three-year termers referred to in Sec. 1(2), Art. IX(D) of the Constitution, had already expired.
Hence, their respective terms of office find relevancy for the most part only in understanding the
operation of the rotational plan. In Gaminde v. Commission on Audit,[19] the Court described how
the smooth functioning of the rotational system contemplated in said and like provisions
covering the two other independent commissions is achieved thru the staggering of terms:

x x x [T]he terms of the first Chairmen and Commissioners of the Constitutional Commissions
under the 1987 Constitution must start on a common date [February 02, 1987, when the 1987
Constitution was ratified] irrespective of the variations in the dates of appointments and
qualifications of the appointees in order that the expiration of the first terms of seven, five and
three years should lead to the regular recurrence of the two-year interval between the
expiration of the terms.

x x x In case of a belated appointment, the interval between the start of the terms and the
actual appointment shall be counted against the appointee.[20] (Italization in the original;
emphasis added.)

Early on, in Republic v. Imperial,[21] the Court wrote of two conditions, “both indispensable to
[the] workability” of the rotational plan.  These conditions may be described as follows: (a) that
the terms of the first batch of commissioners should start on a common date; and (b) that any
vacancy due to death, resignation or disability before the expiration of the term should be
filled only for the unexpired balance of the term. Otherwise, Imperial continued, “the
regularity of the intervals between appointments would be destroyed.” There appears to be near
unanimity as to the purpose/s of the rotational system, as originally conceived, i.e., to place in
the commission a new appointee at a fixed interval (every two years presently), thus preventing a
four-year administration appointing more than one permanent and regular commissioner,[22] or to
borrow from Commissioner Monsod of the 1986 CONCOM, “to prevent one person (the
President of the Philippines) from dominating the commissions.”[23] It has been declared too that
the rotational plan ensures continuity in, and, as indicated earlier, secure the independence of, the
commissions as a body.[24]

2.     An appointment to any vacancy in COA, which arose from an expiration of a term, after the
first chairman and commissioners appointed under the 1987 Constitution have bowed out, shall,
by express constitutional fiat, be for a term of seven (7) years, save when the appointment is to
fill up a vacancy for the corresponding unserved term of an outgoing member. In that case, the
appointment shall only be for the unexpired portion of the departing commissioner’s term of
office. There can only be an unexpired portion when, as a direct result of  his demise, disability,
resignation or impeachment, as the case may be, a sitting member is unable to complete his term
of office.[25] To repeat, should the vacancy arise out of the expiration of the term of the
incumbent, then there is technically no unexpired portion to speak of. The vacancy is for a new
and complete seven-year term and, ergo, the appointment thereto shall in all instances be for a
maximum seven (7) years.

3.  Sec. 1(2), Art. IX(D) of the 1987 Constitution prohibits the “reappointment” of a member of
COA after his appointment for seven (7) years. Writing for the Court in Nacionalista Party v. De
Vera,[26] a case involving the promotion of then COMELEC Commissioner De Vera to the
position of chairman, then Chief Justice Manuel Moran called attention to the fact that the
prohibition against “reappointment” comes as a continuation of the requirement that the
commissioners––referring to members of the COMELEC under the 1935 Constitution––shall
hold office for a term of nine (9) years. This sentence formulation imports, notes Chief Justice
Moran, that reappointment is not an absolute prohibition.

4. The adverted system of regular rotation or the staggering of appointments and terms in the
membership for all three constitutional commissions, namely the COA, Commission on
Elections (COMELEC) and Civil Service Commission (CSC) found in the 1987 Constitution
was patterned after the amended 1935 Constitution for the appointment of the members of
COMELEC[27] with this difference:  the 1935 version entailed a regular interval of vacancy every
three (3) years, instead of the present two (2) years and there was no express provision on
appointment to any vacancy being limited to the unexpired portion of the his predecessor’s term.
The model 1935 provision reads:

Section 1. There shall be an independent Commission on Elections composed of a Chairman and

two other members to be appointed by the President with the consent of the Commission on
Appointments, who shall hold office for a term of nine years and may not be reappointed. Of the
Members of the Commission first appointed, one shall hold office for nine years, another for six
years and the third for three years. x x x

Petitioner now asseverates the view that Sec. 1(2), Art. IX(D) of the 1987 Constitution
proscribes reappointment of any kind within the commission, the point being that a second
appointment, be it for the same position (commissioner to another position of commissioner) or
upgraded position (commissioner to chairperson) is a prohibited reappointment and is a nullity
ab initio.  Attention is drawn in this regard to the Court’s disposition in Matibag v. Benipayo.[28]

Villar’s promotional appointment, so it is argued, is void from the start, constituting as it did a
reappointment enjoined by the Constitution, since it actually needed another appointment to a
different office and requiring another confirmation by the Commission on Appointments.

Central to the adjudication of the instant petition is the correct meaning to be given to Sec. 1(2),
Article IX(D) of the Constitution on the ban against reappointment in relation to the appointment
issued to respondent Villar to the position of COA Chairman.

Without question, the parties have presented two (2) contrasting and conflicting positions. 
Petitioner contends that Villar’s appointment is proscribed by the constitutional ban on
reappointment under the aforecited constitutional provision.  On the other hand, respondent
Villar initially asserted that his appointment as COA Chairman is valid up to February 2, 2015
pursuant to the same provision.

The Court finds petitioner’s position bereft of merit.  The flaw lies in regarding the word
“reappointment” as, in context, embracing any and all species of appointment.

The rule is that if a statute or constitutional provision is clear, plain and free from ambiguity, it
must be given its literal meaning and applied without attempted interpretation.[29]  This is known
as the plain meaning rule enunciated by the maxim verba legis non est recedendum, or from the
words of a statute there should be no departure.[30]

The primary source whence to ascertain constitutional intent or purpose is the language of the
provision itself.[31]  If possible, the words in the Constitution must be given their ordinary
meaning, save where technical terms are employed. J.M. Tuason & Co., Inc. v. Land Tenure
Administration illustrates the verbal legis rule in this wise:

We look to the language of the document itself in our search for its meaning.  We do not of
course stop there, but that is where we begin.  It is to be assumed that the words in which
constitutional provisions are couched express the objective sought to be attained.  They are
to be given their ordinary meaning except where technical terms are employed in which case the
significance thus attached to them prevails.  As the Constitution is not primarily a lawyer’s
document, it being essential for the rule of law to obtain that it should ever be present in the
people’s consciousness, its language as much as possible should be understood in the sense
they have in common use.  What it says according to the text of the provision to be construed
compels acceptance and negates the power of the courts to alter it, based on the postulate that the
framers and the people mean what they say.  Thus there are cases where the need for
construction is reduced to a minimum.[32] (Emphasis supplied.)

Let us dissect and examine closely the provision in question:

(2) The Chairman and Commissioners [on Audit] shall be appointed by the President with
the consent of the Commission on Appointments for a term of seven years without
reappointment.  Of those first appointed, the Chairman shall hold office for seven years, one
commissioner for five years, and the other commissioner for three years, without reappointment. 
Appointment to any vacancy shall be only for the unexpired portion of the term of the
predecessor. x x x (Emphasis added.)

The first sentence is unequivocal enough.  The COA Chairman shall be appointed by the
President for a term of seven years, and if he has served the full term, then he can no longer be
reappointed or extended another appointment.  In the same vein, a Commissioner who was
appointed for a term of seven years who likewise served the full term is barred from being
reappointed.  In short, once the Chairman or Commissioner shall have served the full term of
seven years, then he can no longer be reappointed to either the position of Chairman or
Commissioner.  The obvious intent of the framers is to prevent the president from “dominating”
the Commission by allowing him to appoint an additional or two more commissioners.

The same purpose obtains in the second sentence of Sec. 1(2).  The Constitutional Convention
barred reappointment to be extended to commissioner-members first appointed under the 1987
Constitution to prevent the President from controlling the commission.  Thus, the first Chairman
appointed under the 1987 Constitution who served the full term of seven years can no longer be
extended a reappointment. Neither can the Commissioners first appointed for the terms of five
years and three years be eligible for reappointment.  This is the plain meaning attached to the
second sentence of Sec. 1(2), Article IX(D).

On the other hand, the provision, on its face, does not prohibit a promotional appointment from
commissioner to chairman as long as the commissioner has not served the full term of seven
years, further qualified by the third sentence of Sec. 1(2), Article IX (D) that “the appointment to
any vacancy shall be only for the unexpired portion of the term of the predecessor.”  In addition,
such promotional appointment to the position of Chairman must conform to the rotational plan or
the staggering of terms in the commission membership such that the aggregate of the service of
the Commissioner in said position and the term to which he will be appointed to the position of
Chairman must not exceed seven years so as not to disrupt the rotational system in the
commission prescribed by Sec. 1(2), Art. IX(D).

In conclusion, there is nothing in Sec. 1(2), Article IX(D) that explicitly precludes a promotional
appointment from Commissioner to Chairman, provided it is made under the aforestated
circumstances or conditions.

It may be argued that there is doubt or ambiguity on whether Sec. 1(2), Art. IX(D), as couched,
allows a promotional appointment from Commissioner to Chairman.  Even if We concede the
existence of an ambiguity, the outcome will remain the same.  J.M. Tuason & Co., Inc.[33] teaches
that in case of doubt as to the import and react of a constitutional provision, resort should be
made to extraneous aids of construction, such as debates and proceedings of the Constitutional
Convention, to shed light on and ascertain the intent of the framers or the purpose of the
provision being construed.

The understanding of the Convention as to what was meant by the terms of the constitutional
provision which was the subject of the deliberation goes a long way toward explaining the
understanding of the people when they ratified it.  The Court applied this principle in Civil
Liberties Union v. Executive Secretary:

A foolproof yardstick in constitutional construction is the intention underlying the provision

under consideration.  Thus, it has been held that the Court in construing a Constitution should
bear in mind the object sought to be accomplished by its adoption, and the evils, if any, sought to
be prevented or remedied.  A doubtful provision will be examined in the light of the history of
the times, and the condition and circumstances under which the Constitution was framed.  The
object is to ascertain the reason which induced the framers of the Constitution to enact the
particular provision and the purpose sought to be accomplished thereby, in order to
construe the whole as to make the words consonant to that reason and calculated to effect
that purpose.[34]  (Emphasis added.)

And again in Nitafan v. Commissioner on Internal Revenue:

x x x The ascertainment of that intent is but in keeping with the fundamental principle of
constitutional construction that the intent of the framers of the organic law and of the
people adopting it should be given effect.  The primary task in constitutional construction is to
ascertain and thereafter assure the realization of the purpose of the framers and of the people in
the adoption of the Constitution.  It may also be safely assumed that the people in ratifying
the Constitution were guided mainly by the explanation offered by the framers.[35] 
(Emphasis added.)
Much weight and due respect must be accorded to the intent of the framers of the Constitution in
interpreting its provisions.

Far from prohibiting reappointment of any kind, including a situation where a commissioner is
upgraded to the position of chairman, the 1987 Constitution in fact unequivocally allows
promotional appointment, but subject to defined parameters.  The ensuing exchanges during the
deliberations of the 1986 Constitutional Commission (CONCOM) on a draft proposal of what
would eventually be Sec. 1(2), Art. IX(D) of the present Constitution amply support the thesis
that a promotional appointment is allowed provided no one may be in the COA for an aggregate
threshold period of 7 years:

MS. AQUINO: In the same paragraph, I would propose an amendment x x x. Between x x x the
sentence which begins with “In no case,” insert THE APPOINTEE SHALL IN NO CASE
SERVE AN AGGREGATE PERIOD OF MORE THAN SEVEN YEARS. I was thinking that
this may approximate the situation wherein a commissioner is first appointed as chairman. I am
willing to withdraw that amendment if there is a representation on the part of the Committee that
there is an implicit intention to prohibit a term that in the aggregate will exceed more than
seven years. If that is the intention, I am willing to withdraw my amendment.

MR. MONSOD: If the [Gentlewoman] will read the whole Article, she will notice that there is
no reappointment of any kind and, therefore, as a whole there is no way somebody can serve
for more than seven years. The purpose of the last sentence is to make sure that this does not
happen by including in the appointment both temporary and acting capacities.

MS. AQUINO. Yes. Reappointment is fine; that is accounted for. But I was thinking of a
situation wherein a commissioner is upgraded to a position of chairman. But if this
provision is intended to cover that kind of situation, then I am willing to withdraw my
amendment.

MR. MONSOD. It is covered.

MR. FOZ. There is a provision on line 29 precisely to cover that situation. It states:
“Appointment to any vacancy shall be only for the unexpired portion of the predecessor.” In
other words, if there is upgrading of position from commissioner to chairman, the appointee
can serve only the unexpired portion of the term of the predecessor.

MS. AQUINO: But we have to be very specific x x x because it might shorten the term
because he serves only the unexpired portion of the term of the predecessor.

MR. FOZ: He takes it at his own risk. He knows that he will only have to serve the
unexpired portion of the term of the predecessor. (Emphasis added.)[36]

The phrase “upgrading of position” found in the underscored portion unmistakably shows that
Sec. 1(2), Art. IX(D) of the 1987 Constitution, for all its caveat against reappointment, does not
per se preclude, in any and all cases, the promotional appointment or upgrade of a commissioner
to chairman, subject to this proviso: the appointee’s tenure in office does not exceed 7 years in
all. Indeed, such appointment does not contextually come within the restricting phrase “without
reappointment” twice written in that section. Delegate Foz even cautioned, as a matter of fact,
that a sitting commissioner accepting a promotional appointment to fill up an unexpired portion
pertaining to the higher office does so at the risk of shortening his original term.  To illustrate the
Foz’s concern: assume that Carague left COA for reasons other than the expiration of his
threshold 7-year term and Villar accepted an appointment to fill up the vacancy. In this situation,
the latter can only stay at the COA and served the unexpired portion of Carague’s unexpired term
as departing COA Chairman, even if, in the process, his (Villar’s) own 7-year term as COA
commissioner has not yet come to an end. In this illustration, the inviolable regularity of the
intervals between appointments in the COA is preserved.

Moreover, jurisprudence tells us that the word “reappointment” means a second appointment to
one and the same office.[37] As Justice Arsenio Dizon (Justice Dizon) aptly observed in his
dissent in Visarra v. Miraflor,[38]  the constitutional prohibition against the reappointment of a
commissioner refers to his second appointment to the same office after holding it for nine years.
[39]
As Justice Dizon observed, “[T]he occupant of an office obviously needs no such second
appointment unless, for some valid cause, such as the expiration of his term or resignation, he
had ceased to be the legal occupant thereof.” [40] The inevitable implication of Justice Dizon’s
cogent observation is that a promotion from commissioner to chairman, albeit entailing a second
appointment, involves a different office and, hence, not, in the strict legal viewpoint, a
reappointment. Stated a bit differently, “reappointment” refers to a movement to one and the
same office. Necessarily, a movement to a different position within the commission (from
Commissioner to Chairman) would constitute an appointment, or a second appointment, to be
precise, but not reappointment.

A similar opinion was expressed in the same Visarra case by the concurring Justice Angelo
Bautista, although he expressly alluded to a promotional appointment as not being a prohibited
appointment under Art. X of the 1935 Constitution.

Petitioner’s invocation of Matibag as additional argument to contest the constitutionality of

Villar’s elevation to the COA chairmanship is inapposite. In Matibag, then President Macapagal-
Arroyo appointed, ad interim, Alfredo Benipayo as COMELEC Chairman and Resurreccion
Borra and Florentino Tuason as Commissioners, each for a term of office of seven (7) years. All
three immediately took their oath of, and assumed, office. These appointments were twice
renewed because the Commission on Appointments failed to act on the first two ad interim
appointments. Via a petition for prohibition, some disgruntled COMELEC officials assail as
infirm the appointments of Benipayo, et al.

Matibag lists (4) four situations where the prohibition on reappointment would arise, or to be
specific, where the proviso “[t]he Chairman and the Commissioners shall be appointed x x x for
a term of seven years without reappointment” shall apply. Justice Antonio T. Carpio declares in
his dissent that Villar’s appointment falls under a combination of two of the four situations.

Conceding for the nonce the correctness of the premises depicted in the situations referred to in
Matibag, that case is of doubtful applicability to the instant petition.  Not only is it cast against a
different milieu, but the lis mota of the case, as expressly declared in the main opinion, “is the
very constitutional issue raised by petitioner.”[41] And what is/are this/these issue/s? Only two
defined issues in Matibag are relevant, viz: (1) the nature of an ad interim appointment and
subsumed thereto the effect of a by-passed ad interim appointment; and (2) the constitutionality
of renewals of ad interim appointments. The opinion defined these issues in the following wise:
“Petitioner [Matibag] filed the instant petition questioning the appointment and the right to
remain in office of Benipayo, Borra and Tuason as Chairman and Commissioners of the
COMELEC, respectively. Petitioner claims that the ad interim appointments of Benipayo, et al.
violate the constitutional provisions on the independence of COMELEC, as well as on the
prohibitions on temporary appointments and reappointments of its Chairman and members.”  As
may distinctly be noted, an upgrade or promotion was not in issue in Matibag.

We shall briefly address the four adverted situations outlined in Matibag, in which, as there
urged, the uniform proviso on no reappointment––after a member of any of the three
constitutional commissions is appointed for a term of seven (7) years––shall apply.  Matibag
made the following formulation:

The first situation is where an ad interim appointee after confirmation by the Commission on
Appointments serves his full 7-year term. Such person cannot be reappointed whether as a
member or as chairman because he will then be actually serving more than seven (7) years.

The second situation is where the appointee, after confirmation, serves part of his term and then
resigns before his seven-year term of office ends. Such person cannot be reappointed whether as
a member or as chair to a vacancy arising from retirement because a reappointment will result in
the appointee serving more than seven years.

The third situation is where the appointee is confirmed to serve the unexpired portion of
someone who died or resigned, and the appointee completes the unexpired term. Such person
cannot be reappointed whether as a member or as chair to a vacancy arising from retirement
because a reappointment will result in the appointee also serving more than seven (7) years.

The fourth situation is where the appointee has previously served a term of less than seven
(7) years, and a vacancy arises from death or resignation. Even if it will not result in his
serving more than seven years, a reappointment of such person to serve an unexpired term
is also prohibited because his situation will be similar to those appointed under the second
sentence of Sec. 1(20), Art. IX-C of the Constitution [referring to the first set of appointees
(the 5 and 3 year termers) whose term of office are less than 7 years but are barred from
being reappointed under any situation].”[42] (Words in brackets and emphasis supplied.)

The situations just described constitute an obiter dictum, hence without the force of adjudication,
for the corresponding formulation of the four situations was not in any way necessary to resolve
any of the determinative issues specifically defined in Matibag. An opinion entirely unnecessary
for the decision of the case or one expressed upon a point not necessarily involved in the
determination of the case is an obiter.[43]

There can be no serious objection to the scenarios depicted in the first, second and third
situations, both hewing with the proposition that no one can stay in any of the three independent
commissions for an aggregate period of more than seven (7) years.  The fourth situation,
however, does not commend itself for concurrence inasmuch as it is basically predicated on the
postulate that reappointment, as earlier herein defined, of any kind is prohibited under any and
all circumstances. To reiterate, the word “reappointment” means a second appointment to one
and the same office; and   Sec. 1(2), Art. IX(D) of the 1987 Constitution and similar provisions
do not peremptorily prohibit the promotional appointment of a commissioner to chairman,
provided the new appointee’s tenure in both capacities does not exceed seven (7) years in all. 
The statements in Matibag enunciating the ban on reappointment in the aforecited fourth
situation, perforce, must be abandoned, for, indeed, a promotional appointment from the position
of Commissioner to that of Chairman is constitutionally permissible and not barred by Sec. 1(2),
Art. IX (D) of the Constitution.

One of the aims behind the prohibition on reappointment, petitioner urges, is to ensure and
preserve the independence of COA and its members,[44] citing what the dissenting Justice J.B.L
Reyes wrote in Visarra, that once appointed and confirmed, the commissioners should be free to
act as their conscience demands, without fear of retaliation or hope or reward. Pursued to its
logical conclusion, petitioner’s thesis is that a COA member may no longer act with
independence if he or she can be rewarded with a promotion or appointment, for then he or she
will do the bidding of the appointing authority in the hope of being promoted or reappointed.

The unstated reason behind Justice J.B.L. Reyes’ counsel is that independence is really a matter
of choice. Without taking anything away from the gem imparted by the eminent jurist, what
Chief Justice Moran said on the subject of independence is just as logically sound and perhaps
even more compelling, as follows:

A Commissioner, hopeful of reappointment may strive to do good. Whereas, without that hope
or other hope of material reward, his enthusiasm may decline as the end of his term approaches
and he may even lean to abuses if there is no higher restrain in his moral character. Moral
character is no doubt the most effective safeguard of independence. With moral integrity, a
commissioner will be independent with or without the possibility of reappointment.[45]

The Court is likewise unable to sustain Villar’s proposition that his promotional appointment as
COA Chairman gave him a completely fresh 7- year term––from February 2008 to February
2015––given his four (4)-year tenure as COA commissioner devalues all the past
pronouncements made by  this Court, starting in De Vera, then Imperial, Visarra, and finally
Matibag. While there had been divergence of opinion as to the import of the word
“reappointment,” there has been unanimity on the dictum that in no case can one be a COA
member, either as chairman or commissioner, or a mix of both positions, for an aggregate term
of more than 7 years. A contrary view would allow a circumvention of the aggregate 7-year
service limitation and would be constitutionally offensive as it would wreak havoc to the spirit of
the rotational system of succession. Imperial, passing upon the rotational system as it applied to
the then organizational set-up of the COMELEC, stated:

The provision that of the first three commissioners appointed “one shall hold office for 9 years,
another for 6 years and the third for 3 years,” when taken together with the prescribed term of
office for 9 years without reappointment, evinces a deliberate plan to have a regular rotation or
cycle in the membership of the commission, by having subsequent members appointable only
once every three years.[46]

To be sure, Villar’s appointment as COA Chairman partakes of a promotional appointment

which, under appropriate setting, would be outside the purview of the constitutional
reappointment ban in Sec 1(2), Art. IX(D) of the Constitution. Nonetheless, such appointment,
even for the term appearing in the underlying appointment paper, ought still to be struck down as
unconstitutional for the reason as shall be explained.

Consider:

In a mandatory tone, the aforecited constitutional provision decrees that the appointment of a
COA member shall be for a fixed 7-year term if the vacancy results from the expiration of the
term of the predecessor.  We reproduce in its pertinent part the provision referred to:

(2) The Chairman and Commissioners [on Audit] shall be appointed x x x for a term of
seven years without reappointment. x x x Appointment to any vacancy shall be only for the
unexpired portion of the term of the predecessor. x x x

Accordingly, the promotional appointment as COA Chairman of Villar for a stated fixed term of
less than seven (7) years is void for violating a clear, but mandatory constitutional prescription.
There can be no denying that the vacancy in the position of COA chairman when Carague
stepped down in February 2, 2008 resulted from the expiration of his 7-year term. Hence, the
appointment to the vacancy thus created ought to have been one for seven (7) years in line with
the verbal legis approach[47] of interpreting the Constitution. It is to be understood, however,
following Gaminde, that in case of a belated appointment, the interval between the start of the
term and the actual appointment shall be counted against the 7-year term of the appointee. 
Posing, however, as an insurmountable barrier to a full 7-year appointment for Villar is the rule
against one serving the commission for an aggregate term of more than seven (7) years.

Where the Constitution or, for that matter, a statute, has fixed the term of office of a public
official, the appointing authority is without authority to specify in the appointment a term shorter
or longer than what the law provides. If the vacancy calls for a full seven-year appointment, the
President is without discretion to extend a promotional appointment for more or for less than
seven (7) years. There is no in between. He or she cannot split terms. It is not within the power
of the appointing authority to override the positive provision of the Constitution which dictates
that the term of office of members of constitutional bodies shall be seven (7) years.[48] A contrary
reasoning “would make the term of office to depend upon the pleasure or caprice of the
[appointing authority] and not upon the will [of the framers of the Constitution] of the legislature
as expressed in plain and undoubted language in the law.”[49]

In net effect, then President Macapagal-Arroyo could not have had, under any circumstance,
validly appointed Villar as COA Chairman, for a full 7- year appointment, as the Constitution
decrees, was not legally feasible in light of the 7-year aggregate rule. Villar had already served 4
years of his 7-year term as COA Commissioner.  A shorter term, however, to comply with said
rule would also be invalid as the corresponding appointment would effectively breach the clear
purpose of the Constitution of giving to every appointee so appointed subsequent to the first set
of commissioners, a fixed term of office of 7 years.  To recapitulate, a COA commissioner like
respondent Villar who serves for a period less than seven (7) years cannot be appointed as
chairman when such position became vacant as a result of the expiration of the 7-year term of the
predecessor (Carague).  Such appointment to a full term is not valid and constitutional, as the
appointee will be allowed to serve more than seven (7) years under the constitutional ban.

On the other hand, a commissioner who resigned before serving his 7- year term can be extended
an appointment to the position of chairman for the unexpired period of the term of the latter,
provided the aggregate of the period he served as commissioner and the period he will serve as
chairman will not exceed seven (7) years.  This situation will only obtain when the chairman
leaves the office by reason of death, disability, resignation or impeachment.  Let us consider, in
the concrete, the situation of then Chairman Carague and his successor, Villar.  Carague was
appointed COA Chairman effective February 2, 2001 for a term of seven (7) years, or up to
February 2, 2008.  Villar was appointed as Commissioner on February 2, 2004 with a 7-year
term to end on February 2, 2011.  If Carague for some reason vacated the chairmanship in 2007,
then Villar can resign as commissioner in the same year and later be appointed as chairman to
serve only up to February 2, 2008, the end of the unexpired portion of Carague’s term. In this
hypothetical scenario, Villar’s appointment to the position of chairman is valid and constitutional
as the aggregate periods of his two (2) appointments will only be five (5) years which neither
distorts the rotational scheme nor violates the rule that the sum total of said appointments shall
not exceed seven (7) years. Villar would, however, forfeit two (2) years of his original seven (7)-
year term as Commissioner, since, by accepting an upgraded appointment to Carague’s position,
he agreed to serve the unexpired portion of the term of the predecessor. As illustrated earlier,
following Mr. Foz’s line, if there is an upgrading of position from commissioner to chairman, the
appointee takes the risk of cutting short his original term, knowing pretty well before hand that
he will serve only the unexpired portion of the term of his predecessor, the outgoing COA
chairman.

In the extreme hypothetical situation that Villar vacates the position of chairman for causes other
than the expiration of the original term of Carague, the President can only appoint the successor
of Villar for the unexpired portion of the Carague term in line with Sec. 1(2), Art. IX(D) of the
Constitution. Upon the expiration of the original 7-year term of Carague, the President can
appoint a new chairman for a term of seven (7) full years.

In his separate dissent, my esteemed colleague, Mr. Justice Mendoza, takes strong exception to
the view that the promotional appointment of a sitting commissioner is plausible only when he is
appointed to the position of chairman for the unexpired portion of the term of said official who
leaves the office by reason of any the following reasons: death, disability, resignation or
impeachment, not when the vacancy arises out as a result of the expiration of the 7-year term of
the past chairman.  There is nothing in the Constitution, so Justice Mendoza counters, that
restricts the promotion of an incumbent commissioner to the chairmanship only in instances
where the tenure of his predecessor was cut short by any of the four events referred to.  As earlier
explained, the majority view springs from the interplay of the following premises: The explicit
command of the Constitution is that the “Chairman and the Commissioners shall be appointed by
the President x x x for a term of seven years [and] appointment to any vacancy shall be only for
the unexpired portion of the term of the predecessor.”  To repeat, the President has two and only
two options on term appointments. Either he extends an appointment for a full 7-year term when
the vacancy results from the expiration of term, or for a shorter period corresponding to the
unexpired term of the predecessor when the vacancy occurs by reason of death, physical
disability, resignation or impeachment.  If the vacancy calls for a full seven-year appointment,
the Chief Executive is barred from extending a promotional appointment for less than seven
years.  Else, the President can trifle with terms of office fixed by the Constitution.

Justice Mendoza likewise invites attention to an instance in history when a commissioner had
been promoted chairman after the expiration of the term of his predecessor, referring
specifically to the appointment of then COMELEC Commissioner Gaudencio Garcia to succeed
Jose P. Carag after the expiration of the latter’s term in 1959 as COMELEC chairman.  Such
appointment to the position of chairman is not constitutionally permissible under the 1987
Constitution because of the policy and intent of its framers that a COA member who has served
his full term of seven (7) years or even for a shorter period can no longer be extended another
appointment to the position of chairman for a full term of seven (7) years.  As revealed in the
deliberations of the Constitutional Commission that crafted the 1987 Constitution, a member of
COA who also served as a commissioner for less than seven (7) years in said position cannot be
appointed to the position of chairman for a full term of seven (7) years since the aggregate will
exceed seven (7) years.  Thus, the adverted Garcia appointment in 1959 made under the 1935
Constitution cannot be used as a precedent to an appointment of such nature under the 1987
Constitution.  The dissent further notes that the upgrading remained uncontested.  In this regard,
suffice it to state that the promotion in question was either legal or it was not.  If it were not, no
amount of repetitive practices would clear it of invalidating taint.

Lastly, Villar’s appointment as chairman ending February 2, 2011 which Justice Mendoza
considers as valid is likewise unconstitutional, as it will destroy the rationale and policy behind
the rotational system or the staggering of appointments and terms in COA as prescribed in the
Constitution.  It disturbs in a way the staggered rotational system of appointment under Sec. 1(2),
Art. IX(D) of the 1987 Constitution. Consider: If Villar’s term as COA chairman up to February
2, 2011 is viewed as valid and constitutional as espoused by my esteemed colleague, then two
vacancies have simultaneously occurred and two (2) COA members going out of office at once,
opening positions for two (2) appointables on that date as Commissioner San Buenaventura’s
term also expired on that day. This is precisely one of the mischiefs the staggering of terms and
the regular intervals appointments seek to address. Note that San Buenaventura was specifically
appointed to succeed Villar as commissioner, meaning she merely occupied the position vacated
by her predecessor whose term as such commissioner expired on February 2, 2011.  The result is
what the framers of the Constitution doubtless sought to avoid, a sitting President with a 6-year
term of office, like President Benigno C. Aquino III, appointing all or at least two (2) members
of the three-man Commission during his term.  He appointed Ma. Gracia Pulido-Tan as
Chairman for the term ending February 2, 2015 upon the relinquishment of the post by
respondent Villar, and Heidi Mendoza was appointed Commissioner for a 7- year term ending
February 2, 2018 to replace San Buenaventura.  If Justice Mendoza’s version is adopted, then
situations like the one which obtains in the Commission will definitely be replicated in gross
breach of the Constitution and in clear contravention of the intent of its framers. Presidents in the
future can easily control the Commission depriving it of its independence and impartiality.

To sum up, the Court restates its ruling on Sec. 1(2), Art. IX(D) of the Constitution, viz:

1.  The appointment of members of any of the three constitutional commissions, after the
expiration of the uneven terms of office of the first set of commissioners, shall always be for a
fixed term of seven (7) years; an appointment for a lesser period is void and unconstitutional.

The appointing authority cannot validly shorten the full term of seven (7) years in case of the
expiration of the term as this will result in the distortion of the rotational system prescribed by
the Constitution.

2. Appointments to vacancies resulting from certain causes (death, resignation, disability or

impeachment) shall only be for the unexpired portion of the term of the predecessor, but such
appointments cannot be less than the unexpired portion as this will likewise disrupt the
staggering of terms laid down under Sec. 1(2), Art. IX(D).

3. Members of the Commission, e.g. COA, COMELEC or CSC, who were appointed for a full
term of seven years and who served the entire period, are barred from reappointment to any
position in the Commission. Corollarily, the first appointees in the Commission under the
Constitution are also covered by the prohibition against reappointment.

4. A commissioner who resigns after serving in the Commission for less than seven years is
eligible for an appointment to the position of Chairman for the unexpired portion of the term of
the departing chairman. Such appointment is not covered by the ban on reappointment, provided
that the aggregate period of the length of service as commissioner and the unexpired period of
the term of the predecessor will not exceed seven (7) years and provided further that the vacancy
in the position of Chairman resulted from death, resignation, disability or removal by
impeachment. The Court clarifies that “reappointment” found in Sec. 1(2), Art. IX(D) means a
movement to one and the same office (Commissioner to Commissioner or Chairman to
Chairman).  On the other hand, an appointment involving a movement to a different position or
office (Commissioner to Chairman) would constitute a new appointment and, hence, not, in the
strict legal sense, a reappointment barred under the Constitution.

5. Any member of the Commission cannot be appointed or designated in a temporary or acting

capacity.

WHEREFORE the petition is PARTLY GRANTED.  The appointment of then Commissioner

Reynaldo A. Villar to the position of Chairman of the Commission on Audit to replace
Guillermo N. Carague, whose term of office as such chairman has expired, is hereby declared
UNCONSTITUTIONAL for violation of Sec. 1(2), Art. IX(D) of the Constitution.

SO ORDERED.
 G.R. No. 199082, July 23, 2013

JOSE MIGUEL T. ARROYO, Petitioner, v. DEPARTMENT OF JUSTICE;

COMMISSION ON ELECTIONS; HON. LEILA DE LIMA, IN HER CAPACITY AS
SECRETARY OF THE DEPARTMENT OF JUSTICE; HON. SIXTO BRILLANTES,
JR., IN HIS CAPACITY AS CHAIRPERSON OF THE COMMISSION ON ELECTIONS;
 AND THE JOINT DOJ-COMELEC PRELIMINARY INVESTIGATION COMMITTEE
AND FACT-FINDING TEAM, Respondents.

RESOLUTION

PERALTA, J.:

For resolution are the separate motions for reconsideration filed by movants Gloria Macapagal
Arroyo (GMA)1 in G.R. No. 199118 and Jose Miguel T. Arroyo (Mike Arroyo)2 in G.R. No.
199082  praying that the Court take a second look at our September 18, 2012 Decision3
dismissing their petitions and supplemental petitions against respondents Commission on
Elections (Comelec), the Department of Justice (DOJ), Senator Aquilino M. Pimentel III
(Senator Pimentel), Joint DOJ-Comelec Preliminary Investigation Committee (Joint Committee)
and DOJ-Comelec Fact-Finding Team (Fact-Finding Team), et al.

For a better perspective, we briefly state the relevant factual and procedural antecedents as found
by the Court in the assailed decision, to wit:
cralavvonlinelawlibrary

On August 15, 2011, the Comelec and the DOJ issued Joint Order No. 001-2011 creating and
constituting a Joint Committee and Fact-Finding Team (referred to as Joint Panel) on the 2004
and 2007 National Elections electoral fraud and manipulation cases. The Joint Committee was
mandated to conduct the necessary preliminary investigation on the basis of the evidence
gathered and the charges recommended by the Fact-Finding Team. The Fact-Finding Team, on
the other hand, was created for the purpose of gathering real, documentary, and testimonial
evidence which can be utilized in the preliminary investigation to be conducted by the Joint
Committee.  Pursuant to Section 74 of the Joint Order, on August 23, 2011, the Joint Committee
promulgated its Rules of Procedure.

In its Initial Report5 dated October 20, 2011, the Fact-Finding Team concluded that manipulation
of the results in the May 14, 2007 senatorial elections in the provinces of North and South
Cotabato, and Maguindanao was indeed perpetrated.6 The Fact-Finding Team recommended,
among others, that petitioner Benjamin S. Abalos, Sr. (Abalos) be subjected to preliminary
investigation for electoral sabotage for conspiring to manipulate the election results in North and
South Cotabato; that GMA and Abalos be subjected to another preliminary investigation for
manipulating the election results in Maguindanao;7 and, that Mike Arroyo be subjected to further
investigation.8 The case was docketed as DOJ-Comelec Case No. 001-2011.

Meanwhile, on October 17, 2011, Senator Pimentel filed a Complaint-Affidavit9 for Electoral
Sabotage against petitioners and twelve others, and several John Does and Jane Does. The case
was docketed as DOJ-Comelec Case No. 002-2011.

On October 24, 2011, the Joint Committee issued two subpoenas against petitioners in DOJ-
Comelec Case Nos. 001-2011 and 002-2011.10 On November 3, 2011, petitioners, through
counsel, appeared before the Joint Committee11  and respondents therein were ordered to submit
their Counter-Affidavits by November 14, 2011.12

Thereafter, petitioners filed before the Court separate Petitions for Certiorari and Prohibition
with Prayer for the Issuance of a Temporary Restraining Order (TRO) and/or Writ of Preliminary
Injunction assailing the creation of the Joint Panel.13 The petitions were eventually consolidated.

On November 14, 2011, Mike Arroyo filed a Motion to Defer Proceedings14 before the Joint
Committee, in view of the pendency of his petition before the Court. On the same day, GMA
filed before the Joint Committee an Omnibus Motion Ad Cautelam15 to require Senator Pimentel
to furnish her with documents referred to in his complaint-affidavit and for the production of
election documents as basis for the charge of electoral sabotage. GMA prayed that she be
allowed to file her counter-affidavit within ten (10) days from receipt of the requested
documents.16 Petitioner Abalos, for his part, filed a Motion to Suspend Proceedings (Ex
Abundante Ad Cautelam),17 in view of the pendency of his petition brought before the Court.

In an Order18 dated November 15, 2011, the Joint Committee denied the aforesaid motions of
petitioners. GMA, subsequently, filed a motion for reconsideration.19

On November 16, 2011, the Joint Committee promulgated a Joint Resolution which was later
indorsed to the Comelec.20 On November 18, 2011, the Comelec en banc issued a Resolution21
approving and adopting the Joint Resolution subject to modifications. The Comelec resolved,
among others, that an information for electoral sabotage be filed against GMA and Abalos, while
the charges against Mike Arroyo be dismissed for insufficiency of evidence.

On even date, pursuant to the above Resolution, the Comelec’s Law Department filed with the
Regional Trial Court (RTC), Pasay City, an Information against petitioner GMA, Governor
Andal Ampatuan, Sr., and Atty. Lintang H. Bedol, for violation of Section 42(b)(3) of Republic
Act (RA) No.  9369, amending Section 27 (b) of RA 6646, docketed as Criminal Case No.
RPSY-11-04432-CR.22 The case was raffled to Branch 112 and the corresponding Warrant of
Arrest was issued which was served on GMA on the same day.23

On November 18, 2011, GMA filed with the RTC an Urgent Omnibus Motion Ad Cautelam24
with leave to allow the Joint Committee to resolve the motion for reconsideration filed by GMA,
to defer issuance of a warrant of arrest and a hold departure order, and to proceed to judicial
determination of probable cause. She, likewise, filed with the Comelec a Motion to Vacate Ad
Cautelam25 praying that its Resolution be vacated for being null and void. The RTC, nonetheless,
issued a Warrant for her arrest which was duly served. GMA was later arraigned and she entered
a plea of “not guilty.” She was, for some time, on hospital arrest but was able to obtain
temporary liberty when her motion for bail was granted. At present, she is again on hospital
arrest by virtue of a warrant issued in another criminal case.

On September 18, 2012, the Court rendered the assailed Decision, the dispositive portion of
which reads:cralavvonlinelawlibrary

WHEREFORE, premises considered, the petitions and supplemental petitions are

DISMISSED. Comelec Resolution No. 9266 dated August 2, 2011, Joint Order No. 001-2011
dated August 15, 2011, and the Fact- Finding Team’s Initial Report dated October 20, 2011, are
declared VALID. However, the Rules of Procedure on the Conduct of Preliminary Investigation
on the Alleged Election Fraud in the 2004 and 2007 National Elections is declared
INEFFECTIVE for lack of publication.

In view of the constitutionality of the Joint Panel and the proceedings having been conducted in
accordance with Rule 112 of the Rules on Criminal Procedure and Rule 34 of the Comelec Rules
of Procedure, the conduct of the preliminary investigation is hereby declared VALID.

Let the proceedings in the Regional Trial Court of Pasay City, Branch 112, where the criminal
cases for electoral sabotage against petitioners GMA and Abalos are pending, proceed with
dispatch.

SO ORDERED.26

Hence, these motions for reconsideration.

Issues

Mike Arroyo reiterates his arguments on the independence of the Comelec as basis in nullifying
the subject joint DOJ-Comelec resolutions. Echoing Justice Arturo Brion in his Dissenting and
Concurring Opinion,27 Mike Arroyo insists that the creation of the Joint Panel undermines the
decisional independence of the Comelec.28

Mike Arroyo also maintains that the DOJ should conduct preliminary investigation only when
deputized by the Comelec but not exercise concurrent jurisdiction.29  Finally, as has been
repeatedly pointed out in his earlier pleadings before the Court, Mike Arroyo claims that the
proceedings involving the electoral sabotage case were rushed because of pressures from the
executive branch of the government.30

For her part, GMA claims that in availing of the procedural remedies available, she merely
exercised her earnest efforts to defend herself and should not have been deemed by the Court as
acts which purportedly tend to demonstrate that she either waived or forfeited her right to submit
her counter-affidavit and countervailing evidence.31 Citing several cases decided by the Court,
she likewise faults the Court in not upholding her right to ask for additional time within which to
submit her counter-affidavit and countervailing evidence.32 GMA highlights that the subject
Comelec Resolution creating the Joint Panel is different from the previous Comelec resolutions
requesting the DOJ Secretary to assign prosecutors to assist the Comelec, as the latter emphasize
the role of the DOJ as deputized agency in the conduct of preliminary investigation.  She
maintains that it is the Comelec and not the Joint Committee that has the primary, if not
exclusive, authority to conduct preliminary investigation of election cases.33

In their Consolidated Comment,34 respondents defend the creation of the Joint Committee and
argue that it does not undermine the independence of the Comelec as a constitutional body
because it is still the Comelec that ultimately determines probable cause.35 As to the conduct of
the preliminary investigation, respondents maintain that no rights were violated as GMA was
afforded the opportunity to defend herself, submit her counter-affidavit and other countervailing
evidence.36 They, thus, consider GMA’s claim of availing of the remedial measures as “delaying
tactics” employed to thwart the investigation of charges against her by the Joint Committee.37

The Court’s Ruling

Clearly from the above discussion, movants raise issues that have been thoroughly explained by
the Court in the assailed decision. The issues were all addressed and the explanation was
exhaustive, thus, we find no reason to disturb the Court’s conclusions.

At any rate, if only to address the motions of the movants herein and to put an end to the
questions attached to the creation of the Joint Panel and, consequently, to the performance of
their assigned tasks, we hereby reiterate our findings and conclusions made in the assailed
decision.

This is not the first time that the Court is confronted with the issue of whether the Comelec has
the exclusive power to investigate and prosecute cases of violations of election laws. In
Barangay Association for National Advancement and Transparency (BANAT) Party-List v.
Commission on Elections,38 the constitutionality of Section 4339 of RA 936940 had already been
raised by petitioners therein and addressed by the Court. While recognizing the Comelec’s
exclusive power to investigate and prosecute cases under Batas Pambansa Bilang 881 or the
Omnibus Election Code, the Court pointed out that the framers of the 1987 Constitution did not
have such intention. This exclusivity is thus a legislative enactment that can very well be
amended by  Section 43 of RA 9369. Therefore, under the present law, the Comelec and other
prosecuting arms of the government, such as the DOJ, now exercise concurrent jurisdiction in the
investigation and prosecution of election offenses.

Indeed, as aptly pointed out by GMA, there is a discrepancy between Comelec Resolution No.
346741 dated January 12, 2001 and Joint Order No. 001-2011, dated August 15, 2011, creating
and constituting a Joint Committee and Fact-Finding Team on the 2004 and 2007 National
Elections electoral fraud and manipulation cases. However, GMA seemed to miss the date when
these two resolutions were promulgated by the Comelec. It is noteworthy that Comelec
Resolution No. 3467 was issued when Section 265 of the Omnibus Election Code was still
effective, while Joint Order No. 001-2011 as well as Comelec Resolution Nos. 873342 and 905743
mentioned in the assailed decision but missed out by GMA in her motion, were issued during the
effectivity of Section 43 of RA 9369, giving the Comelec and other prosecuting arms of the
government the concurrent jurisdiction to investigate and prosecute election offenses. This
amendment paved the way for the discrepancy. In Comelec Resolution No. 3467, the Comelec
maintained the continuing deputation of prosecutors and the Comelec Law Department was
tasked to supervise the investigatory and prosecutory functions of the task force pursuant to the
mandate of the Omnibus Election Code. However, with the amendment, the Comelec likewise
changed the tenor of the later resolutions to reflect the new mandate of the Comelec and other
prosecuting arms of the government now exercising concurrent jurisdiction. Thus, the Comelec
Law Department and the Office of the Chief State Prosecutor of the DOJ were tasked to jointly
supervise the investigatory and prosecutory functions of the Comelec-DOJ Task Force.
Considering, therefore, that the later resolutions, including Joint Order No. 001-2011, were
issued pursuant to Section 43 of RA 9369 amending Section 265 of BP 881 which was declared
“constitutional” in Banat, there is no reason for us to declare otherwise.  To maintain the
previous role of other prosecuting arms of the government as mere deputies despite the
amendment would mean challenging Section 43 of RA 9369 anew which has already been
settled in Banat.

To be sure, the creation of a Joint Committee is not repugnant to the concept of “concurrent
jurisdiction” authorized by the amendatory law. As we explained in our September 18, 2012
Decision: cralavvonlinelawlibrary

x x x  The doctrine of concurrent jurisdiction means equal jurisdiction to deal with the same
subject matter. Contrary to the contention of the petitioners, there is no prohibition on
simultaneous exercise of power between two coordinate bodies. What is prohibited is the
situation where one files a complaint against a respondent initially with one office (such as the
Comelec) for preliminary investigation which was immediately acted upon by said office and the
re-filing of substantially the same complaint with another office (such as the DOJ). The
subsequent assumption of jurisdiction by the second office over the cases filed will not be
allowed. Indeed, it is a settled rule that the body or agency that first takes cognizance of the
complaint shall exercise jurisdiction to the exclusion of the others.

xxxx

None of these problems would likely arise in the present case. The Comelec and the DOJ
themselves agreed that they would exercise their concurrent jurisdiction jointly. Although the
preliminary investigation was conducted on the basis of two complaints – the initial report of the
Fact-Finding Team and the complaint of Senator Pimentel – both complaints were filed with the
Joint Committee. Consequently, the complaints were filed with and the preliminary investigation
was conducted by only one investigative body. Thus, we find no reason to disallow the exercise
of concurrent jurisdiction jointly by those given such authority. This is especially true in this case
given the magnitude of the crimes allegedly committed by petitioners. The joint preliminary
investigation also serves to maximize the resources and manpower of both the Comelec and the
DOJ for the prompt disposition of the cases.44

Notwithstanding the grant of concurrent jurisdiction, the Comelec and the DOJ nevertheless
included a provision in the assailed Joint Order whereby the resolutions of the Joint Committee
finding probable cause for election offenses shall still be approved by the Comelec in accordance
with the Comelec Rules of Procedure.45 With more reason, therefore, that we cannot consider the
creation of the Joint Committee as an abdication of the Comelec’s independence enshrined in the
1987 Constitution.

Finally, we focus on the validity of the preliminary investigation conducted by the Joint
Committee.

The procedure in conducting the preliminary investigation is governed by Rule 112 of the
Revised Rules on Criminal Procedure and Rule 34 of the Comelec Rules of Procedure. Under
both Rules,46 the respondent shall submit his counter-affidavit and that of his witnesses and other
supporting documents relied upon for his defense, within ten (10) days from receipt of the
subpoena, with the complaint and supporting affidavits and documents.47 Also in both Rules,
respondent is given the right to examine evidence, but such right of examination is limited only
to the documents or evidence submitted by complainants which she may not have been furnished
and to copy them at her expense.48

As to the alleged denial of GMA’s right to examine documents, we maintain that no right was
violated in view of the limitation of such right as set forth above. We reiterate our explanation in
the assailed decision, to wit:
cralavvonlinelawlibrary

While it is true that Senator Pimentel referred to certain election documents which served as
bases in the allegations of significant findings specific to the protested municipalities involved,
there were no annexes or attachments to the complaint filed. As stated in the Joint Committee’s
Order dated November 15, 2011 denying GMA’s Omnibus Motion Ad Cautelam, Senator
Pimentel was ordered to furnish petitioners with all the supporting evidence. However, Senator
Pimentel manifested that he was adopting all the affidavits attached to the Fact-Finding Team’s
Initial Report. Therefore, when GMA was furnished with the documents attached to the Initial
Report, she was already granted the right to examine as guaranteed by the Comelec Rules of
Procedure and the Rules on Criminal Procedure. Those were the only documents submitted by
the complainants to the Committee. If there are other documents that were referred to in Senator
Pimentel’s complaint but were not submitted to the Joint Committee, the latter considered those
documents unnecessary at that point (without foreclosing the relevance of other evidence that
may later be presented during the trial) as the evidence submitted before it were considered
adequate to find probable cause against her. x x x49

Neither was GMA’s right violated when her motion for extension of time within which to submit
her counter-affidavit and countervailing evidence was consequently denied. The Rules use the
term “shall” in requiring the respondent to submit counter-affidavit and other countervailing
evidence within ten (10) days from receipt of the subpoena. It is settled that the use of the word
“shall” which is a word of command, underscores the mandatory character of the rule.50 As in
any other rule, though, liberality in the application may be allowed provided that the party is able
to present a compelling justification for the non-observance of the mandatory rules. In the 2008
Revised Manual for Prosecutors, investigating prosecutors allow or grant motions or requests for
extension of time to submit counter-affidavits when the interest of justice demands that
respondent be given reasonable time or sufficient opportunity to engage the services of counsel;
examine voluminous records submitted in support of the complaint or undertake research on
novel, complicated or technical questions or issues of law and facts of the case.51

In this case, GMA claimed that she could not submit her counter-affidavit within the prescribed
period because she needed to examine documents mentioned in Senator Pimentel’s complaint-
affidavit. It appeared, however, that said documents were not submitted to the Joint Committee
and the only supporting documents available were those attached to the Initial Report of the
Fact-Finding Team. Admittedly, GMA was furnished those documents. Thus, at the time she
asked for the extension of time within which to file her counter-affidavit, she very well knew that
the documents she was asking were not in the record of the case. Obviously, she was not
furnished those documents because they were not submitted to the Joint Committee. Logically,
she has no right to examine said documents. We cannot, therefore, fault the Joint Committee in
consequently denying her motion for extension to file counter-affidavit as there was no
compelling justification for the non-observance of the period she was earlier required to follow.

And as we held in the assailed decision: cralavvonlinelawlibrary

There might have been overzealousness on the part of the Joint Committee in terminating the
investigation, endorsing the Joint Resolution to the Comelec for approval, and in filing the
information in court. However, speed in the conduct of proceedings by a judicial or quasi-
judicial officer cannot per se be instantly attributed to an injudicious performance of functions.
The orderly administration of justice remains the paramount consideration with particular regard
to the peculiar circumstances of each case. To be sure, petitioners were given the opportunity to
present countervailing evidence. Instead of complying with the Joint Committee’s directive,
several motions were filed but were denied by the Joint Committee. Consequently, petitioners’
right to submit counter-affidavit and countervailing evidence was forfeited. Taking into account
the constitutional right to speedy disposition of cases and following the procedures set forth in
the Rules on Criminal Procedure and the Comelec Rules of Procedure, the Joint Committee
finally reached its conclusion and referred the case to the Comelec. The latter, in turn, performed
its task and filed the information in court. Indeed, petitioners were given the opportunity to be
heard. They even actively participated in the proceedings and in fact filed several motions before
the Joint Committee. Consistent with the constitutional mandate of speedy disposition of cases,
unnecessary delays should be avoided. 52

Finally, in our assailed decision, we already took judicial notice that not only did GMA enter a
plea of “not guilty,” she also filed a Motion for Bail and after due hearing, it was granted.
Apparently, she benefited from the RTC Order giving her temporary liberty. In filing the motion
before the RTC and actively participating therein, she has chosen to seek judicial remedy before
the RTC where the electoral sabotage case is pending instead of the executive remedy of going
back to the Joint Committee for the submission of her counter-affidavit and countervailing
evidence. Besides, as thoroughly discussed in the assailed decision, the irregularity or even the
absence of preliminary investigation does not impair the validity of the information filed against
her.

WHEREFORE, premises considered, the Motions for Reconsideration are DENIED for lack of
merit.

SO ORDERED.

[G.R. NO. 180245 - July 4, 2012]

PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., Petitioner, v.

TAKENAKA CORPORATION and ASAHIKOSAN CORPORATION, Respondents.

DECISION
 PERALTA, J.:

This resolves the Petition for Review on Certiorari under Rule 45 of the Rules of Court, praying
that the Decision1 of the Court of Appeals (CA), dated July 27, 2007, and the CA Resolution2
dated October 23, 2007, denying herein petitioner's motion for partial reconsideration, be
reversed and set aside.

The antecedent facts were accurately narrated in the CA Decision as follows.

In 1997, by way of a Concession Agreement, the Philippine Government awarded to petitioner

the right to build and operate the NAIA International Passenger Terminal III ("NAIA IPT3").
Petitioner then contracted respondents Takenaka Corporation, and Asahikosan Corporation
("private respondents") to construct and equip NAIA IPT3.

Private respondents are both foreign corporations organized under the laws of Japan, but only
respondent Takenaka Corporation is licensed to do business in the Philippines through its local
branch office.

Claiming that petitioner made no further payments after May 2002 despite continued
performance of their obligations, private respondents filed two collection suits before the High
Court of Justice, Queen's Bench Division, Technology and Construction Court in London,
England ("London Court"), docketed as Claim No. HT-04-248 and Claim No. HT-05-269. In
both claims, respondent Takenaka Corporation was designated as the First Claimant and
respondent Asahikosan Corporation, the Second Claimant.

Ruling in favor of private respondents, the London Court issued an Order dated February 18,
2005 in Claim No. HT-04-248 and an Order dated December 2, 1005 in Claim No. HT-05-269,
directing that -

Claim No. HT-04-248 ςηαñrοblεš  Î½Î¹r† Ï…αl  lαω  lιbrαrÿ

"1. Judgment be entered for the First Claimant in the sum of 6,602,971.00 United States dollars,
together with interest in the sum of 116,825,365.34 Philippine pesos up to and including 18
February 2005.

2. Judgment be entered for the Second Claimant in the sum of 8,224,236.00 United States
dollars, together with interest in the sum of 2,947,564.87 United States dollars up to and
including 18 February 2005, being a total of 11,171,800.87 United States dollars.

3. Save for the costs of and caused by the amendment of the particulars of claim, which will be
the subject of a separate order, the Defendant to pay the First Claimant's and the Second
Claimant's costs in the action, to be subject to detailed assessment if not agreed."
chanrobles virtual law library

Claim No. HT-05-269 ςηαñrοblεš  Î½Î¹r† Ï…αl  lαω  lιbrαrÿ

"1. Judgment be entered for the First Claimant in the sum of 21,688,012.18 United States dollars,
together with interest in the sum of 6,052,805.83 United States dollars.

2. Judgment be entered for the Second Claimant in the sum of 30,319,248.36 United States
dollars, together with interest in the sum of 5,442,628.26 United States dollars.

3. The Defendant to pay the Claimants' costs in the action, to be subject to detailed assessment if
not agreed."
chanrobles virtual law library

On March 1, 2006, private respondents filed a Complaint, docketed as Civil Case No. 06-171,
before the Regional Trial Court of Makati City, Br. 58, to enforce the aforesaid Orders of the
London Court.

Petitioner filed a Motion to Dismiss the Complaint on the grounds of: (a) defective verification
and certification against forum shopping, because there was no board resolution showing that
Mr. Takeshi Kurebayashi was authorized by private respondents to sign the verification and
certification of non-forum shopping, and the special powers of attorney executed in favor of Mr.
Kurebayashi by the Executive Vice-President and President of respondents Takenaka
Corporation and Asahikosan Corporation, respectively, were not only insufficient but also
improperly authenticated since the said officers never personally appeared before the notary
public, and finally, Mr. Kurebayashi was not competent to guarantee that respondent Asahikosan
Corporation has not engaged in forum shopping, not being an employee or member of the said
corporation; (b) forum shopping, because the Complaint was allegedly private respondents' third
attempt to file the same claim, the first attempt being private respondents' voluntary submission
to the jurisdiction of the Pasay Court in Civil Case No. 04-0876, the expropriation case filed by
the Republic of the Philippines against herein petitioner, where private respondents manifested
that they are not objecting to the taking of the condemned property (NAIA IPT3), provided that
they are justly compensated for their claims as unpaid contractors, and the second attempt having
been made before the Supreme Court in G.R. No. 166429 where private respondents moved for
partial reconsideration (in intervention) of the Supreme Court's decision affirming, with
modification, the Pasay Court's Order allowing the full release to herein petitioner of the funds
deposited by the Republic of the Philippines for the expropriation of the NAIA IPT3; (c )
payment, novation, abandonment or extinguishment of the claims, inasmuch as private
respondents have allegedly entered into a contract with the Philippine government pursuant to
which private respondents supposedly received payment of US$10Million from the Philippine
government, with the latter committing to deliver more; and (d) non-compliance with a condition
precedent, because petitioner failed to resort to arbitration before the Construction Industry
Arbitration Commission (CIAC) as allegedly provided by the terms of the parties' agreement.

During the hearing of the Motion to Dismiss on April 7, 2006, private respondents asked for time
to file their Opposition. Private respondents subsequently filed their Opposition, which was
followed by petitioner's Reply, private respondents' Rejoinder and petitioner's Sur-Rejoinder.

On May 9, 2006, petitioner filed a Motion to Set its Motion to Dismiss for hearing, to enable it to
present evidence on the alleged payment, novation and extinguishment of its obligations to
private respondents. Thereafter, petitioner filed a Request for Subpoena Duces Tecum Ad
Testificandum to direct Mr. Takeshi Kurebayashi to appear and testify in court, and to bring the
alleged General Framework Agreement ("GFA") between private respondents and the Philippine
government as represented by the Manila International Airport Authority (MIAA). Petitioner
likewise filed a Motion for Production and Inspection of Documents to require private
respondents, or any of its officers and representatives, to produce and permit the inspection,
copying and photographing of the GFA by petitioner.

Private respondents opposed the said Motions and Request, arguing that the Motion to Dismiss
need not be heard anew because the ground sought to be proved, i.e., payment, novation or
extinguishment of obligation, was based on mere newspaper reports which are hearsay evidence.
Private respondents also asserted that Mr. Kurebayashi may not be compelled to testify as an
adverse party witness without first being served interrogatories. They further argued that
discovery of documents may not be allowed until the answer is filed since the materiality of the
document requested cannot be determined until the issues are joined. And assuming for the sake
of argument that petitioner could prove the partial payment of US$10Million, the payment would
allegedly not extinguish petitioner's total obligation as to result in the dismissal of the action.

Petitioner thereafter filed with the trial court, and served upon the President of respondent
Takenaka Corporation, Written Interrogatories which, among others, asked if Takenaka entered
into a General Framework Agreement with the Philippine government, what its salient features
are, and if any amount has been paid to Takenaka by the Philippine government.

Private respondents moved to expunge the Written Interrogatories, arguing that written
interrogatories cannot be served without leave of court before an Answer has been filed.

On June 26, 2006, petitioner filed a Motion for Leave to serve its Written Interrogatories on the
President of respondent Takenaka Corporation. That same day, respondent judge issued the first
assailed Omnibus Order denying petitioner's Motion to Dismiss, Motion to Set the Motion to
Dismiss for hearing, Motion for Production and Inspection of Documents, and Written
Interrogatories.

Respondent judge held that Mr. Takeshi Kurebayashi was duly authorized to represent both
private respondents noting the Special Powers of Attorney attached to the Verification and
Certification against Forum Shopping, which were executed by the representative directors of
private respondents, and accompanied by Notarial Certificates executed in Tokyo by a Japanese
Notary, giving authority to Mr. Kurebayashi to file the Complaint. Respondent judge observed
that under Articles 261 and 78 of the Commercial Law of Japan, corporations may act through
their representative directors, similar to the Executive Committee under Philippine Corporation
Law. Respondent judge held that under the principle of lex loci celebrationis, the validity of the
Special Powers of Attorney is determined by the law of the place where they were executed.

Respondent judge rejected petitioner's claim of forum shopping, holding that private respondents
simply served notice on the Pasay Court and the Supreme Court about their being unpaid
contractors. Respondent judge found that private respondents merely prayed that the said Courts
hold in abeyance the release of the funds to petitioner until such time they can enforce the
London Court Orders by virtue of a final judgment, which neither the Pasay court nor the
Supreme Court may render because the case before them was one for expropriation.

Respondent judge likewise rejected petitioner's assertion that its obligation has been extinguished
by payment or novation. According to respondent judge, petitioner's claim that private
respondents had entered into a contract with the Philippine government was based on alleged
newspaper articles which are inadmissible in evidence for being hearsay. If at all, said
respondent judge, such claim should be raised as an affirmative defense in the Answer and
substantiated in a full-blown trial. And assuming private respondents were indeed paid
US$10Million under the alleged contract with the Philippine government, the same is but a small
portion of the total amount claimed which is around US$198Million, excluding attorney's fees
and costs of suit.

Anent private respondents' alleged failure to resort to arbitration, respondent judge held that "this
ground, which actually assails the jurisdiction of the foreign court," is "a matter of affirmative or
special defense" which should be threshed out in a trial.

Finally, respondent judge held that the Motion for Production and Inspection of Documents and
the Written Interrogatories are modes of discovery that can only be availed of after the Answer
has been filed, pursuant to A.M. No. 03-1-09-SC.

Dissatisfied with respondent judge's ruling, petitioner moved for reconsideration of the June 26,
2006 Omnibus Order.

Noting that petitioner "failed to attach a copy of the alleged General Framework (of) Agreement
in its Motion for Reconsideration that will give flesh and blood to its bones of contentions that
(private respondents') claim has already been paid, novated or extinguished," respondent judge
issued his Order dated September 5, 2006, directing petitioner to submit the alleged GFA within
5 days from notice.

Accordingly, petitioner filed a Request for Subpoena Duces Tecum for Alfonso Cusi, General
Manager or Records Custodian of MIAA, to bring the GFA, vouchers, receipts and other papers
proving MIAA's alleged payments to respondent Takenaka Corporation.

On September 22, 2006, respondent judge granted petitioner's request and directed the issuance
of the subpoena duces tecum.

On September 27, 2006, the MIAA, through the Office of the Solicitor General, filed a Motion to
Quash the subpoena duces tecum, without serving a copy of their motion on the parties. The
MIAA averred that the subpoena was oppressive and unreasonable for it allegedly violated
Section 6, Rule 21, and petitioner allegedly failed to show the relevance of the documents sought
to be produced. The MIAA added that "(t)he only objective that (petitioner) has in asking for the
GFA is to use against the Government and shift its burden of paying its EPC contractors,
Takenaka Corporation and Asahikosan Corporation for the unpaid services rendered before the
government expropriated the NAIA Terminal III." The MIAA averred that "(petitioner) is
venturing into a 'fishing expedition' to evade its obligations to Takenaka Corporation and
Asahikosan Corporation, and shifting the burden to the Government."

On October 9, 2006, respondent judge issued the second assailed Order quashing the subpoena
duces tecum, because the MIAA was not given ample opportunity to prepare for the submission
of the requested document, and because petitioner had to show the relevancy of the said
document in the light of MIAA's contention that petitioner is merely shifting the burden to pay
its contractors for unpaid services rendered before the expropriation of the NAIA IPT3.

Consequently, petitioner moved for reconsideration of the October 9, 2006 Order.

On January 15, 2007, respondent judge issued the third assailed Omnibus Order, denying
petitioner's motions for reconsideration of the assailed June 26, 2006 Omnibus Order, and
October 9, 2006 Order.3 ςrνll

Petitioner then filed a Petition for Certiorari, prohibition and mandamus with the CA, alleging
that the trial court committed grave abuse of discretion amounting to lack or excess of
jurisdiction when it refused to set another hearing for the motion to dismiss, when it denied the
Motion to Dismiss and the Motion for Production and Inspection of Documents, and the Written
Interrogatories. The CA ruled that since a hearing on the Motion to Dismiss was held on April 7,
2006 and, thereafter, both parties filed an exchange of pleadings, then petitioner had reasonable
opportunity to be heard, which was the essence of due process. The CA concluded that the trial
court did not commit grave abuse of discretion in denying petitioner's motion to dismiss and the
motion to set said motion for hearing. However, the CA ruled that it was grave abuse of
discretion for the trial judge not to grant the motion for production and inspection of documents
and written interrogatories, because Section 1, Rule 25, in relation to Section 1, Rule 23 provides
that written interrogatories may be served even before the Answer is filed so long as leave of
court has been obtained, and Section 1, Rule 27 states that the motion for production of
documents or things may be filed while the action is pending, which includes the period before
the Answer is filed. With regard to the quashal of the subpoena duces tecum, the CA held that
MIAA s Motion to Quash should not have been acted upon by the trial court because it did not
contain a Notice of Hearing, making it a mere scrap of paper. Thus, it held that the issuance of
the Order dated October 9, 2007 quashing the subject subpoena was done with grave abuse of
discretion. On July 27, 2007, the CA rendered the assailed Decision, disposing as follows: ςrαlαω

WHEREFORE, the petition is GRANTED IN PART. The assailed Order dated October 9,
2006, which quashed the subpoena duces tecum, is hereby SET ASIDE. The assailed Omnibus
Order dated June 26, 2006 is SET ASIDE IN PART insofar as it denied petitioner's Motion for
Production and Inspection of Documents and Written Interrogatories. The assailed Omnibus
Order dated January 15, 2007 is likewise SET ASIDE IN PART insofar as it denied
reconsideration of the June 26, 2006 denial of the Motion for Production and Inspection of
Documents and Written Interrogatories, and the October 9, 2006 quashal of the subpoena duces
tecum. The assailed June 26, 2006 and January 15, 2007 Omnibus Orders are AFFIRMED IN
PART insofar as they denied the Motion to Set the Motion to Dismiss for hearing, and the
Motion to Dismiss.
SO ORDERED.4 ςrνll

Petitioner moved for partial reconsideration of the CA Decision, but the same was denied in a
Resolution dated October 23, 2007.

Hence, this Petition for Review on Certiorari where petitioner alleges that the CA erred (1) in
ruling that the Complaint is not fatally defective despite the fact that only a Special Power of
Attorney, and not a Board Resolution was attached to the Verification and Certification Against
Forum Shopping; and (2) in depriving petitioner the right to present evidence on its Motion to
Dismiss.

On the other hand, respondents countered in their Comment that the petition should be dismissed
outright because it was filed out of time; it did not include a material portion of the record below,
i.e., respondents' Comment to the petition before the CA; and the CA did not err in ruling that
Mr. Kurebayashi was duly authorized by respondents to sign the verification/certification of non-
forum shopping, because under the laws of Japan, under which laws respondents were
incorporated, the board of directors of a Japanese corporation may appoint one or more
Representative Directors who shall have the authority to perform all acts within court
proceedings and out-of-court acts relating to the business of the corporation, and Mr.
Kurebayashi was validly appointed by respondents' Representative Directors to execute the
Verification/Certification.

The Court finds the petition unmeritorious.

At the outset, respondents must be disabused of the belief that the petition was filed late.
Petitioner originally had only until December 14, 2007 within which to file action. However, the
Court indeed suspended office transactions on December 14, 2007 due to the celebration of the
Christmas party so the Court's receiving section was closed. Petitioner, therefore, had until the
next working day, or until December 17, 2007, within which to file the petition. As long as the
petition was filed on that last day of December 17, 2007, then it is considered to have been filed
on time. Records show that the petition was indeed filed on December 17, 2007. Hence, it is of
no moment that the Secretary's Certificate attached to the Verification and Certification of Non-
Forum Shopping was notarized on December 17, 2007, or later than December 14, 2007.

Having resolved the question on the timeliness of the petition, we go on to discuss the main
issues in this case.

The Court does not see any reason to overturn the CA's finding that there was no grave abuse of
discretion on the part of the trial court in denying the Motion to Dismiss and the Motion to Set
the Motion to Dismiss

for Hearing. The established definition of grave abuse of discretion was reiterated in Ligeralde v.
Patalinghug5 in this wise: ςrαlαω

x x x By grave abuse of discretion is meant such capricious or whimsical exercise of judgment

as is equivalent to lack of jurisdiction. The abuse of discretion must be patent and gross as to
amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law, or
to act at all in contemplation of law as where the power is exercised in an arbitrary and
despotic manner by reason of passion and hostility. In sum, for the extraordinary writ of
certiorari to lie, there must be capricious, arbitrary or whimsical exercise of power.6 (Emphases
supplied)

In this case, there is no showing of such capricious or whimsical exercise of judgment or

arbitrary and despotic exercise of power committed by the trial court. In fact, records reveal that
both parties were given ample opportunity to be heard. A hearing on the Motion to Dismiss was,
in fact, held on April 7, 2006. Thereafter, both parties submitted their pleadings setting forth
their claims, arguments and supporting evidence. Petitioner points out that at the April 7, 2006
hearing, the parties were only allowed to file their pleadings, and no actual hearing, or
presentation of evidence, was conducted. It is an oft-repeated principle that where opportunity to
be heard, either through oral arguments or pleadings, is accorded, there is no denial of due
process.7 Moreover, the issues that petitioner seeks to tackle in the requested hearing on the
motion to dismiss, i.e., novation, payment, extinguishment or abandonment of the obligation, are
the meat of their defense and would require the presentation of voluminous evidence. Such
issues are better threshed out during trial proper. Thus, the trial court was not amiss in ruling that
petitioner already had the opportunity to be heard and there was no longer any need to set
another hearing on the motion to dismiss.

It also appears from the RTC's Orders and the CA's Decision that any and all evidence and
argument advanced by both parties were seriously taken into consideration by said lower courts
in arriving at their rulings. Such being the case, there could be no grave abuse of discretion
committed by the trial court.

Lastly, on the issue of the Verification/Certification, the court has the power to give due course
to the complaint even with the supposed defect, if special circumstances warrant. Even assuming
arguendo, that the form used to show Mr. Kurebayashi's authority to execute the Verification
and Certification Against Forum Shopping is defective, petitioner should bear in mind that this
Court may relax the application of procedural rules for the greater interest of substantial justice.
Thus, in Cua, Jr. v. Tan,8 this Court explained thus: ςrαlαω

x x x Although the submission of a certificate against forum shopping is deemed obligatory, it is

not jurisdictional. Hence, in this case in which such a certification was in fact submitted only, it
was defective the Court may still refuse to dismiss and may, instead, give due course to the
Petition in light of attendant exceptional circumstances.

x    x    x

x x x [I]n the interest of substantial justice, the strict application of procedural technicalities
should not hinder the speedy disposition of this case on the merits. x x x

x    x    x
x x x Indeed, where, as here, there is a strong showing that a grave miscarriage of justice would
result from the strict application of the Rules, the Court will not hesitate to relax the same in the
interest of substantial justice. It bears stressing that the rules of procedure are merely tools
designed to facilitate the attainment of justice. They were conceived and promulgated to
effectively aid the court in the dispensation of justice. Courts are not slaves to or robots of
technical rules, shorn of judicial discretion. In rendering justice, courts have always been, as they
ought to be, conscientiously guided by the norm that, on the balance, technicalities take a
backseat against substantive rights, and not the other way around. Thus, if the application of the
Rules would tend to frustrate rather than promote justice, it is always within the power of
the Court to suspend the Rules, or except a particular case from its operation.9 (Emphasis
supplied)cralawlibrary

This case is one of those that deserves a more lenient application of procedural rules, considering
that it affects one of the most important public utilities of our country. In Agan, Jr. v. Philippine
International Air Terminals Co., Inc.,10 this Court has already stated that these cases involving
the construction and operation of the country's premier international airport, has attained
transcendental importance.11 Therefore, the Court sees it fit to relax the rules in this case to arrive
at a full settlement of the parties' claims and avoid further delay in the administration of justice.

IN VIEW OF THE FOREGOING, the petition is DENIED. The Court of Appeal's Decision
dated July 27, 2007, and the CA Resolution dated October 23, 2007 in CA-G.R. SP No. 98166
are hereby AFFIRMED.

SO ORDERED.

[G.R. NO. 161081 : May 10, 2005]

RAMON M. ATIENZA, in his capacity as Vice-Governor of the Province of Occidental

Mindoro, Petitioner, v. JOSE T. VILLAROSA, in his capacity as Governor of the Province
of Occidental Mindoro, Respondent.
 DECISION

CALLEJO, SR., J.:

Before the Court is the Petition for Review on Certiorari filed by Ramon M. Atienza, in his
capacity as Vice-Governor of the Province of Occidental Mindoro, seeking to reverse and set
aside the Decision1 dated November 28, 2003 of the Court of Appeals in CA-G.R. SP No. 72069.
The assailed decision dismissed the petition for prohibition under Rule 65 of the Rules of Court
filed by petitioner Atienza which had sought to enjoin the implementation of the Memoranda
dated June 25, 2002 and July 1, 2002 issued by Jose T. Villarosa, Governor of the same
province.

The present case arose from the following undisputed facts:

Petitioner Atienza and respondent Villarosa were the Vice-Governor and Governor, respectively,
of the Province of Occidental Mindoro. On June 26, 2002, the petitioner Vice-Governor received
the Memorandum dated June 25, 2002 issued by the respondent Governor concerning the
"AUTHORITY TO SIGN PURCHASE ORDERS OF SUPPLIES, MATERIALS,
EQUIPMENT[S], INCLUDING FUEL, REPAIRS AND MAINTENANCE OF THE
SANGGUNIANG PANLALAWIGAN." The said memorandum reads:

For proper coordination and to ensure efficient and effective local government administration
particularly on matters pertaining to supply and property management, effective immediately, all
Purchase Orders issued in connection with the procurement of supplies, materials and
equipment[s] including fuel, repairs and maintenance needed in the transaction of public
business or in the pursuit of any undertaking, project or activity of the Sangguniang
Panlalawigan, this province, shall be approved by the undersigned in his capacity as the local
chief executive of the province.

The provision of DILG Opinion No. 148-1993 which states that the authority to sign Purchase
Orders of supplies, materials and equipment[s] of the Sanggunian belongs to the local chief
executive, serves as basis of this memorandum.

For strict compliance.2

In reply to the above memorandum, the petitioner Vice-Governor wrote the respondent Governor
stating that:

We are of the opinion that - purchase orders for supplies, materials and equipment are included
under those as authorized for signature by the Vice-chief executive of the Sanggunian on the
basis of the DILG Opinion No. 96-1995 as affirmed by the COA Opinions on June 28, April 11
and February 9, 1994 and coursing it to the Governor for his approval is no longer necessary, the
fact that [Secs.] 466 and 468, RA 7160 already provides for the separation of powers between the
executive and legislative. Such authority even include everything necessary for the legislative
research program of the Sanggunian.3
Unimpressed, the respondent Governor issued the Memorandum dated July 1, 2002 relating to
the "TERMINATION OF CONTRACT OF SERVICES OF CASUAL/JOB ORDER
EMPLOYEES AND REAPPOINTMENT OF THE RESPECTIVE RECOMMENDEES." The
said memorandum reads:

For faithful and appropriate enforcement and execution of laws and issuances and to promote
efficiency in the government service, effective immediately, all existing contract of employment
- casual/job order basis and reappointment of the recommendees - entered into by Vice-Governor
Ramon M. Atienza are hereby terminated for being unauthorized.

Aside from being signed by the unauthorized signatory, the following facts regarding the
appointments were considered:

1. The appointment of 28 clerks - on top of existing permanent employees - is a clear

manifestation of an excessive and bloated bureaucracy;

2. The appointment of an X-ray Technician detailed at the Provincial Health Office and some
clerks detailed at various offices in the province were not proper to be assigned by the Vice-
Governor;

3. The appointment of 30 messengers, utility workers and drivers ran counter to COA Opinion as
cited in the letter of the undersigned dated 28 June 2002, addressed to the Vice-Governor.

However, in order to accommodate the Vice-Governor and the members of the Sangguniang
Panlalawigan, the undersigned, in his capacity as the local chief executive of the province, will
allow four (4) casual/job order employees to be assigned to the Vice-Governor and one (1)
casual/job order employee to be assigned to each member of the Sangguniang Panlalawigan.

The Vice-Governor and all the Sanggunian Members are hereby directed to submit immediately
the names of their recommendees to the undersigned for immediate approval of their respective
appointments.

Please be guided accordingly.4

On July 3, 2002, the respondent Governor issued another Memorandum regarding the
"ENFORCIBILITY (sic) OF PREVIOUS MEMORANDA ISSUED ON JUNE 20, 26 AND
JULY 1, 2002." It provides that:

Please be properly advised that the Memoranda dated June 20, 26 and July 1, 2002 issued by the
undersigned regarding the issuance of permit to travel and authority to sign Purchase Orders of
supplies, materials, equipment, including fuel, repairs and maintenance of the Sangguniang
Panlalawigan, is to be strictly adhered to for compliance.

Likewise for strict compliance is the Memorandum dated July 1, 2002 with reference to the
Cancellation of the Appointment of Casual/Job Order Employees of the Sangguniang
Panlalawigan Members/Office of the Vice-Governor previously signed by Vice-Governor
Ramon M. Atienza.

Please be guided accordingly.5

In his Letter dated July 9, 2002, the petitioner Vice-Governor invoked the principle of separation
of powers as applied to the local government units, i.e., the respondent, as the Governor, the head
of the executive branch, and the petitioner, as the Vice-Governor, the head of the legislative
branch, which is the Sangguniang Panlalawigan. The petitioner Vice-Governor reiterated his
request for the respondent to make a "deeper study" on the matter before implementing his
memoranda. The request, however, went unheeded as the respondent Governor insisted on
obliging the department heads of the provincial government to comply with the memoranda.

The petitioner Vice-Governor thus filed with the Court of Appeals the petition for prohibition
assailing as having been issued with grave abuse of discretion the respondent Governor's
Memoranda dated June 25, 2002 and July 1, 2002. The petitioner Vice-Governor claimed that
these memoranda excluded him from the use and enjoyment of his office in violation of the
pertinent provisions of Republic Act No. 7160, or the Local Government Code of 1991, and its
implementing rules and regulations. It was prayed that the respondent Governor be enjoined
from implementing the assailed memoranda.

The appellate court, in its Decision dated November 28, 2003, dismissed the petition for
prohibition. Citing Section 3446 of Rep. Act No. 7160, the CA upheld the authority of the
respondent Governor to issue the Memorandum dated June 25, 2002 as it recognized his
authority to approve the purchase orders. The said provision provides in part that "approval of
the disbursement voucher by the local chief executive himself shall be required whenever local
funds are disbursed."

The CA explained that Section 466(a)(1)7 of the same Code, relied upon by the petitioner Vice-
Governor, speaks of the authority of the Vice-Governor to sign "all warrants drawn on the public
treasury for all expenditures appropriated for the operation of the sangguniang panlalawigan." In
declaring this provision inapplicable, the CA reasoned that the approval of purchase orders is
different from the power of the Vice-Governor to sign warrants drawn against the public
treasury.

Section 3618 was, likewise, held to be inapplicable ratiocinating, thus:

[R]equisitioning, which is provided under Section 361 of RA 7160, is the act of requiring that
something be furnished. In the procurement function, it is the submission of written requests for
supplies and materials and the like. It could be inferred that, in the scheme of things, approval of
purchase requests is different from approval of purchase orders. Thus, the inapplicability of
Section 361.

Anent the Memorandum dated July 1, 2002, the CA ruled that the issue on whether it could be
enjoined had already been rendered moot and academic. The CA pointed out that the subject of
the said memorandum could no longer be enjoined or restrained as the termination of the
employees had already been effected. It opined that where the act sought to be enjoined in the
prohibition proceedings had already been performed and there is nothing more to restrain, the
case is already moot and academic.

The petitioner Vice-Governor now seeks recourse to this Court alleging that the appellate court
committed reversible error in ruling that it is the Governor, and not the Vice-Governor, who has
the authority to sign purchase orders of supplies, materials, equipment, including fuel, repairs
and maintenance of the Sangguniang Panlalawigan. The petitioner Vice-Governor, likewise,
takes exception to the holding of the CA that the issue relating to the July 1, 2002 Memorandum
had been rendered moot and academic. He points out that the appointment of casual/job order
employees is exercised by the appointing authority every six months in the case of casual
employees and per job order as to job order employees. Thus, while the July 1, 2002
Memorandum had already been implemented, what is being sought to be enjoined is the
respondent Governor's continued usurpation of the petitioner Vice-Governor's authority to
appoint the employees of the Sangguniang Panlalawigan under the pertinent provisions of Rep.
Act No. 7160.

For his part, the respondent Governor maintains that his Memoranda dated June 25, 2002 and
July 1, 2002 are valid. He asserts that the approval of purchase orders is different from the power
of the Vice-Governor to sign warrants drawn against the provincial treasury under Section 466(a)
(1) of Rep. Act No. 7160. Rather, he insists on the application of the last clause in Section 344
which states that the approval of the disbursement by the local chief executive is required
whenever local funds are disbursed.

The respondent Governor likewise defends the validity of the Memorandum dated July 1, 2002
stating that it was issued upon finding that the petitioner Vice-Governor appointed, among
others, 28 clerks on top of the existing permanent employees resulting in an excessive and
bloated bureaucracy. He concedes the appointing power of the Vice-Governor but submits that
this is limited to the employees of the Sangguniang Panlalawigan and that he is not authorized to
appoint officials and employees of the Office of the Vice-Governor.

As correctly presented by the appellate court, the issues for resolution in this case are:

A. Who between the petitioner and the respondent is authorized to approve purchase orders
issued in connection with the procurement of supplies, materials, equipment, including fuel,
repairs and maintenance of the Sangguniang Panlalawigan? cralawlibrary

B. Does respondent Villarosa, as local chief executive, have the authority to terminate or cancel
the appointments of casual/job order employees of the Sangguniang Panlalawigan Members and
the Office of the Vice-Governor?9

Before resolving the foregoing issues, it is noted that petitioner Atienza and respondent Villarosa
had ceased to be the Vice-Governor and Governor, respectively, of the Province of Occidental
Mindoro effective June 30, 2004 when the newly-elected officials of the province took their
oaths of offices. The petitioner Vice-Governor did not run for re-election during the May 2004
elections while the respondent Governor did not succeed in his re-election bid. The expiration of
their terms of offices has effectively rendered the case moot. However, even in cases where
supervening events had made the cases moot, the Court did not hesitate to resolve the legal or
constitutional issues raised to formulate controlling principles to guide the bench, bar and the
public.10 In this case, there is compelling reason for the Court to resolve the issues presented in
order to clarify the scope of the respective powers of the Governor and Vice-Governor under the
pertinent provisions of the Local Government Code of 1991.

To resolve the substantive issues presented in the instant case, it is well to recall that Rep. Act
No. 7160 was enacted to give flesh to the constitutional mandate to "provide for a more
responsive and accountable local government structure instituted through a system of
decentralization with effective mechanism of recall, initiative and referendum, allocate among
the different local government units their powers, responsibilities, and resources, and provide for
the qualifications, election, appointment and removal, term, salaries, powers and functions and
duties of local officials, and all matters relating to the organization and operation of the local
units."11

In this connection, the provisions of Rep. Act No. 7160 are anchored on principles that give
effect to decentralization. Among these principles are: [t]here shall be an effective allocation
among the different local government units of their respective powers, functions, responsibilities,
and resources; [t]here shall be established in every local government unit an accountable,
efficient, and dynamic organizational structure and operating mechanism that will meet the
priority needs and service requirements of its communities; [p]rovinces with respect to
component cities and municipalities, and cities and municipalities with respect to component
barangays, shall ensure that the acts of their component units are within the scope of their
prescribed powers and functions; and [e]ffective mechanisms for ensuring the accountability of
local government units to their respective constituents shall be strengthened in order to upgrade
continually the quality of local leadership.12

With these guideposts, the Court shall now address the issue on who between the Governor and
Vice-Governor is authorized to approve purchase orders issued in connection with the
procurement of supplies, materials, equipment, including fuel, repairs and maintenance of the
Sangguniang Panlalawigan.

We hold that it is the Vice-Governor who has such authority.

Under Rep. Act No. 7160, local legislative power for the province is exercised by the
Sangguniang Panlalawigan13 and the Vice-Governor is its presiding officer.14 Being vested with
legislative powers, the Sangguniang Panlalawigan enacts ordinances, resolutions and
appropriates funds for the general welfare of the province in accordance with the provisions of
Rep. Act No. 7160.15 The same statute vests upon the Vice-Governor the power to:

(1) Be the presiding officer of the sangguniang panlalawigan and sign all warrants drawn on the
provincial treasury for all expenditures appropriated for the operation of the sangguniang
panlalawigan.16

Further, Section 344 provides:

Sec. 344. Certification on, and Approval of, Vouchers. - No money shall be disbursed unless the
local budget officer certifies to the existence of appropriation that has been legally made for the
purpose, the local accountant has obligated said appropriation, and the local treasurer certifies to
the availability of funds for the purpose. Vouchers and payrolls shall be certified to and approved
by the head of the department or office who has administrative control of the fund concerned, as
to validity, propriety and legality of the claim involved. Except in cases of disbursements
involving regularly recurring administrative expenses such as payrolls for regular or permanent
employees, expenses for light, water, telephone and telegraph services, remittances to
government creditor agencies such as the GSIS, SSS, LBP, DBP, National Printing Office,
Procurement Service of the DBM and others, approval of the disbursement voucher by the local
chief executive himself shall be required whenever local funds are disbursed.

In cases of special or trust funds, disbursements shall be approved by the administrator of the
fund.

In case of temporary absence or incapacity of the department head or chief of office, the officer
next-in-rank shall automatically perform his function and he shall be fully responsible therefor.

Reliance by the CA on the clause "approval of the disbursement voucher by the local chief
executive himself shall be required whenever local funds are disbursed" of the above section
(Section 344) to rule that it is the Governor who has the authority to approve purchase orders for
the supplies, materials or equipment for the operation of the Sangguniang Panlalawigan is
misplaced. This clause cannot prevail over the more specific clause of the same provision which
provides that "vouchers and payrolls shall be certified to and approved by the head of the
department or office who has administrative control of the fund concerned." The Vice-Governor,
as the presiding officer of the Sangguniang Panlalawigan, has administrative control of the
funds of the said body. Accordingly, it is the Vice-Governor who has the authority to approve
disbursement vouchers for expenditures appropriated for the operation of the Sangguniang
Panlalawigan.

On this point, Section 39 of the Manual on the New Government Accounting System for Local
Government Units, prepared by the Commission on Audit (COA), is instructive:

Sec. 39. Approval of Disbursements. - Approval of disbursements by the Local Chief Executive
(LCE) himself shall be required whenever local funds are disbursed, except for regularly
recurring administrative expenses such as: payrolls for regular or permanent employees,
expenses for light, water, telephone and telegraph services, remittances to government creditor
agencies such as GSIS, BIR, PHILHEALTH, LBP, DBP, NPO, PS of the DBM and others,
where the authority to approve may be delegated. Disbursement vouchers for expenditures
appropriated for the operation of the Sanggunian shall be approved by the provincial Vice
Governor, the city Vice-Mayor or the municipal Vice-Mayor, as the case may be.17

While Rep. Act No. 7160 is silent as to the matter, the authority granted to the Vice-Governor to
sign all warrants drawn on the provincial treasury for all expenditures appropriated for the
operation of the Sangguniang Panlalawigan as well as to approve disbursement vouchers
relating thereto necessarily includes the authority to approve purchase orders covering the same
applying the doctrine of necessary implication. This doctrine is explained, thus:

No statute can be enacted that can provide all the details involved in its application. There is
always an omission that may not meet a particular situation. What is thought, at the time of
enactment, to be an all-embracing legislation may be inadequate to provide for the unfolding of
events of the future. So-called gaps in the law develop as the law is enforced. One of the rules of
statutory construction used to fill in the gap is the doctrine of necessary implication. The doctrine
states that what is implied in a statute is as much a part thereof as that which is expressed. Every
statute is understood, by implication, to contain all such provisions as may be necessary to
effectuate its object and purpose, or to make effective rights, powers, privileges or jurisdiction
which it grants, including all such collateral and subsidiary consequences as may be fairly and
logically inferred from its terms. Ex necessitate legis. And every statutory grant of power, right
or privilege is deemed to include all incidental power, right or privilege. This is so because the
greater includes the lesser, expressed in the maxim, in eo plus sit, simper inest et minus.18

Warrants are "order[s] directing the treasurer of the municipality to pay money out of funds in
city treasury which are or may become available for purpose specified to designated person[s]."19
Warrants of a municipal corporation are generally orders payable when funds are found. They
are issued for the payment of general municipal debts and expenses subject to the rule that they
shall be paid in the order of presentation.20

The ordinary meaning of "voucher" is a document which shows that services have been
performed or expenses incurred. It covers any acquittance or receipt discharging the person or
evidencing payment by him. When used in connection with disbursement of money, it implies
some instrument that shows on what account or by what authority a particular payment has been
made, or that services have been performed which entitle the party to whom it is issued to
payment.21

Purchase order, on the other hand, is "an authorization by the issuing party for the recipient to
provide materials or services for which issuing party agrees to pay; it is an offer to buy which
becomes binding when those things ordered have been provided."22

When an authorized person approves a disbursement voucher, he certifies to the correctness of

the entries therein, among others: that the expenses incurred were necessary and lawful, the
supporting documents are complete and the availability of cash therefor. Further, the person who
performed the services or delivered the supplies, materials or equipment is entitled to payment.23
On the other hand, the terms and conditions for the procurement of supplies, materials or
equipment, in particular, are contained in a purchase order. The tenor of a purchase order
basically directs the supplier to deliver the articles enumerated and subject to the terms and
conditions specified therein.24 Hence, the express authority to approve disbursement vouchers
and, in effect, authorize the payment of money claims for supplies, materials or equipment,
necessarily includes the authority to approve purchase orders to cause the delivery of the said
supplies, materials or equipment.
Since it is the Vice-Governor who approves disbursement vouchers and approves the payment
for the procurement of the supplies, materials and equipment needed for the operation of the
Sangguniang Panlalawigan, then he also has the authority to approve the purchase orders to
cause the delivery of the said supplies, materials or equipment.

Indeed, the authority granted to the Vice-Governor to sign all warrants drawn on the provincial
treasury for all expenditures appropriated for the operation of the Sangguniang Panlalawigan as
well as to approve disbursement vouchers relating thereto is greater and includes the authority to
approve purchase orders for the procurement of the supplies, materials and equipment necessary
for the operation of the Sangguniang Panlalawigan.

Anent the second issue, the appellate court likewise committed reversible error in holding that
the implementation of the Memorandum dated July 1, 2002 had rendered the petition moot and
academic. It is recognized that courts will decide a question otherwise moot and academic if it is
"capable of repetition yet evading review."25 Even if the employees whose contractual or job
order employment had been terminated by the implementation of the July 1, 2002 Memorandum
may no longer be reinstated, still, similar memoranda may be issued by other local chief
executives. Hence, it behooves the Court to resolve whether the Governor has the authority to
terminate or cancel the appointments of casual/job order employees of the Sangguniang
Panlalawigan and the Office of the Vice-Governor.

We hold that the Governor, with respect to the appointment of the officials and employees of the
Sangguniang Panlalawigan, has no such authority.

Among the powers granted to the Governor under Section 465 of Rep. Act No. 7160 are:

Sec. 465. The Chief Executive: Powers, Duties, Functions and Compensation. - (a) The
provincial governor, as the chief executive of the provincial government, shall exercise such
powers and perform such duties and functions as provided by this Code and other laws.

(b) For efficient, effective and economical governance the purpose of which is the general
welfare of the province and its inhabitants pursuant to Section 16 of this Code, the provincial
governor shall:

(v) Appoint all officials and employees whose salaries and wages are wholly or mainly paid out
of provincial funds and whose appointments are not otherwise provided for in this Code, as well
as those he may be authorized by law to appoint.

On the other hand, Section 466 vests on the Vice-Governor the power to, among others:

(2) Subject to civil service law, rules and regulations, appoint all officials and employees of the
sangguniang panlalawigan, except those whose manner of appointment is specifically provided
in this Code.

Thus, while the Governor has the authority to appoint officials and employees whose salaries are
paid out of the provincial funds, this does not extend to the officials and employees of the
Sangguniang Panlalawigan because such authority is lodged with the Vice-Governor. In the
same manner, the authority to appoint casual and job order employees of the Sangguniang
Panlalawigan belongs to the Vice-Governor.

The authority of the Vice-Governor to appoint the officials and employees of the Sangguniang
Panlalawigan is anchored on the fact that the salaries of these employees are derived from the
appropriation specifically for the said local legislative body. Indeed, the budget source of their
salaries is what sets the employees and officials of the Sangguniang Panlalawigan apart from the
other employees and officials of the province. Accordingly, the appointing power of the Vice-
Governor is limited to those employees of the Sangguniang Panlalawigan, as well as those of the
Office of the Vice-Governor, whose salaries are paid out of the funds appropriated for the
Sangguniang Panlalawigan. As a corollary, if the salary of an employee or official is charged
against the provincial funds, even if this employee reports to the Vice-Governor or is assigned to
his office, the Governor retains the authority to appoint the said employee pursuant to Section
465(b)(v) of Rep. Act No. 7160.

However, in this case, it does not appear whether the contractual/job order employees, whose
appointments were terminated or cancelled by the Memorandum dated July 1, 2002 issued by the
respondent Governor, were paid out of the provincial funds or the funds of the Sangguniang
Panlalawigan. Nonetheless, the validity of the said memorandum cannot be upheld because it
absolutely prohibited the respondent Vice-Governor from exercising his authority to appoint the
employees, whether regular or contractual/job order, of the Sangguniang Panlalawigan and
restricted such authority to one of recommendatory nature only.26 This clearly constituted an
encroachment on the appointment power of the respondent Vice - Governor under Section 466(a)
(2) of Rep. Act No. 7160.

At this juncture, it is well to note that under Batas Pambansa Blg. 337, the Local Government
Code prior to Rep. Act No. 7160, the Governor was the presiding officer of the Sangguniang
Panlalawigan:

Sec. 205. Composition. (1) Each provincial government shall have a provincial legislature
hereinafter known as the sangguniang panlalawigan, upon which shall be vested the provincial
legislative power.

(2) The sangguniang panlalawigan shall be composed of the governor, vice-governor, elective
members of the said sanggunian, and the presidents of the katipunang panlalawigan and the
kabataang barangay provincial federation who shall be appointed by the President of the
Philippines.

Sec. 206. Sessions. -

(3) The governor, who shall be the presiding officer of the sangguniang panlalawigan, shall not
be entitled to vote except in case of a tie.

With Rep. Act No. 7160, the union of legislative and executive powers in the office of the local
chief executive under the BP Blg. 337 has been disbanded, so that either department now
comprises different and non-intermingling official personalities with the end in view of ensuring
a better delivery of public service and provide a system of check and balance between the two.27

Senator Aquilino Pimentel, the principal author of Rep. Act No. 7160, explained that "the Vice-
Governor is now the presiding officer of the Sangguniang Panlalawigan. The City Vice-Mayor
presides at meetings of the Sangguniang Panlungsod and the Municipal Vice-Mayor at the
sessions of the Sangguniang Bayan. The idea is to distribute powers among elective local
officials so that the legislative, which is the Sanggunian, can properly check the executive, which
is the Governor or the Mayor and vice versa and exercise their functions without any undue
interference from one by the other."28

The avowed intent of Rep. Act. No. 7160, therefore, is to vest on the Sangguniang Panlalawigan
independence in the exercise of its legislative functions vis-a-vis the discharge by the Governor
of the executive functions. The Memoranda dated June 25, 2002 and July 1, 2002 of the
respondent Governor, which effectively excluded the petitioner Vice-Governor, the presiding
officer of the Sangguniang Panlalawigan, from signing the purchase orders for the procurement
of supplies, materials or equipment needed for the operation of the Sangguniang Panlalawigan
as well as from appointing its casual and job order employees, constituted undue interference
with the latter's functions. The assailed memoranda are clearly not in keeping with the intent of
Rep. Act No. 7160 and their implementation should thus be permanently enjoined.

WHEREFORE, the petition is GRANTED. The Memoranda dated June 25, 2002 and July 1,
2002 issued by respondent Governor Jose T. Villarosa are NULL AND VOID.

SO ORDERED.

[G.R. NO. 138965 : June 30, 2006]

PUBLIC INTEREST CENTER INC., LAUREANO T. ANGELES, and JOCELYN P.

CELESTINO, Petitioners, v. MAGDANGAL B. ELMA, as Chief Presidential Legal
 Counsel and as Chairman of the Presidential Commission on Good Government, and
RONALDO ZAMORA, as Executive Secretary, Respondents.

DECISION

CHICO-NAZARIO, J.:

This is an original action for Certiorari, Prohibition, and Mandamus, with a Prayer for
Temporary Restraining Order/Writ of Preliminary Injunction filed on 30 June 1999.1 This action
seeks to declare as null and void the concurrent appointments of respondent Magdangal B. Elma
as Chairman of the Presidential Commission on Good Government (PCGG) and as Chief
Presidential Legal Counsel (CPLC) for being contrary to Section 13,2 Article VII and Section 7,
par. 2,3 Article IX-B of the 1987 Constitution. In addition, the petitioners further seek the
issuance of the extraordinary writs of prohibition and mandamus, as well as a temporary
restraining order to enjoin respondent Elma from holding and discharging the duties of both
positions and from receiving any salaries, compensation or benefits from such positions during
the pendency of this petition.4 Respondent Ronaldo Zamora was sued in his official capacity as
Executive Secretary.

On 30 October 1998, respondent Elma was appointed and took his oath of office as Chairman of
the PCGG. Thereafter, on 11 January 1999, during his tenure as PCGG Chairman, respondent
Elma was appointed CPLC. He took his oath of office as CPLC the following day, but he waived
any remuneration that he may receive as CPLC.5

Petitioners cited the case of Civil Liberties Union v. Executive Secretary6 to support their
position that respondent Elma's concurrent appointments as PCGG Chairman and CPLC
contravenes Section 13, Article VII and Section 7, par. 2, Article IX-B of the 1987 Constitution.
Petitioners also maintained that respondent Elma was holding incompatible offices.

Citing the Resolution7 in Civil Liberties Union v. Executive Secretary, respondents allege that
the strict prohibition against holding multiple positions provided under Section 13, Article VII of
the 1987 Constitution applies only to heads of executive departments, their undersecretaries and
assistant secretaries; it does not cover other public officials given the rank of Secretary,
Undersecretary, or Assistant Secretary.

Respondents claim that it is Section 7, par. 2, Article IX-B of the 1987 Constitution that should
be applied in their case. This provision, according to the respondents, would allow a public
officer to hold multiple positions if (1) the law allows the concurrent appointment of the said
official; and (2) the primary functions of either position allows such concurrent appointment.
Respondents also alleged that since there exists a close relation between the two positions and
there is no incompatibility between them, the primary functions of either position would allow
respondent Elma's concurrent appointments to both positions. Respondents further add that the
appointment of the CPLC among incumbent public officials is an accepted practice.

The resolution of this case had already been overtaken by supervening events. In 2001, the
appointees of former President Joseph Estrada were replaced by the appointees of the incumbent
president, Gloria Macapagal Arroyo. The present PCGG Chairman is Camilo Sabio, while the
position vacated by the last CPLC, now Solicitor General Antonio Nachura, has not yet been
filled. There no longer exists an actual controversy that needs to be resolved. However, this case
raises a significant legal question as yet unresolved - whether the PCGG Chairman can
concurrently hold the position of CPLC. The resolution of this question requires the exercise of
the Court's judicial power, more specifically its exclusive and final authority to interpret laws.
Moreover, the likelihood that the same substantive issue raised in this case will be raised again
compels this Court to resolve it.8 The rule is that courts will decide a question otherwise moot
and academic if it is "capable of repetition, yet evading review."9

Supervening events, whether intended or accidental, cannot prevent the Court from rendering a
decision if there is a grave violation of the Constitution. Even in cases where supervening events
had made the cases moot, this Court did not hesitate to resolve the legal or constitutional issues
raised to formulate controlling principles to guide the bench, bar, and public.10

The merits of this case may now be discussed.

The issue in this case is whether the position of the PCGG Chairman or that of the CPLC falls
under the prohibition against multiple offices imposed by Section 13, Article VII and Section 7,
par. 2, Article IX-B of the 1987 Constitution, which provide that:

Art. VII .

xxxx

Section 13. The President, Vice-President, the Members of the Cabinet, and their deputies or
assistants shall not, unless otherwise provided in this Constitution, hold any other office or
employment during their tenure. x x x

Art. IX-B.

xxxx

Section 7. No elective official shall be eligible for appointment or designation in any capacity to
any public office or position during his tenure.

Unless otherwise allowed by law or by the primary functions of his position, no appointive
official shall hold any other office or employment in the Government or any subdivision, agency
or instrumentality thereof, including government-owned or controlled corporations or their
subsidiaries.

To harmonize these two provisions, this Court, in the case of Civil Liberties Union v. Executive
Secretary,11 construed the prohibition against multiple offices contained in Section 7, Article IX-
B and Section 13, Article VII in this manner:
[T]hus, while all other appointive officials in the civil service are allowed to hold other office or
employment in the government during their tenure when such is allowed by law or by the
primary functions of their positions, members of the Cabinet, their deputies and assistants may
do so only when expressly authorized by the Constitution itself. In other words, Section 7,
Article IX-B is meant to lay down the general rule applicable to all elective and appointive
public officials and employees, while Section 13, Article VII is meant to be the exception
applicable only to the President, the Vice-President, Members of the Cabinet, their deputies and
assistants.

The general rule contained in Article IX-B of the 1987 Constitution permits an appointive
official to hold more than one office only if "allowed by law or by the primary functions of his
position." In the case of Quimson v. Ozaeta,12 this Court ruled that, "[t]here is no legal objection
to a government official occupying two government offices and performing the functions of both
as long as there is no incompatibility." The crucial test in determining whether incompatibility
exists between two offices was laid out in People v. Green13 - whether one office is subordinate
to the other, in the sense that one office has the right to interfere with the other.

[I]ncompatibility between two offices, is an inconsistency in the functions of the two; x x x

Where one office is not subordinate to the other, nor the relations of the one to the other such as
are inconsistent and repugnant, there is not that incompatibility from which the law declares that
the acceptance of the one is the vacation of the other. The force of the word, in its application to
this matter is, that from the nature and relations to each other, of the two places, they ought not to
be held by the same person, from the contrariety and antagonism which would result in the
attempt by one person to faithfully and impartially discharge the duties of one, toward the
incumbent of the other. x x x The offices must subordinate, one [over] the other, and they must,
per se, have the right to interfere, one with the other, before they are incompatible at common
law. x x x

In this case, an incompatibility exists between the positions of the PCGG Chairman and the
CPLC. The duties of the CPLC include giving independent and impartial legal advice on the
actions of the heads of various executive departments and agencies and to review investigations
involving heads of executive departments and agencies, as well as other Presidential appointees.
The PCGG is, without question, an agency under the Executive Department. Thus, the actions of
the PCGG Chairman are subject to the review of the CPLC. In Memorandum Order No. 152,
issued on 9 July 2004, the Office of the President, in an effort to promote efficiency and effective
coordination, clearly delineated and specified the functions and duties of its senior officers as
such:

SECTION 1. The Chief Presidential Legal Counsel (CPLC) shall advise and provide the
President with legal assistance on matters requiring her action, including matters pertaining to
legislation.

The CPLC shall have the following duties and functions:

A. Exercise administrative supervision over the Office of the CPLC;

b. Review and/or draft legal orders referred to her by the President on the following matters that
are subject of decisions of the President;

1. Executive Orders, proclamations, administrative orders, memorandum orders, and other legal
documents initiated by the President;

2. Decision on investigation involving Cabinet Secretaries, agency heads, or Presidential

appointees with the rank of Secretary conducted by the Presidential Anti-Graft Commission
(PAGC);14

As CPLC, respondent Elma will be required to give his legal opinion on his own actions as
PCGG Chairman and review any investigation conducted by the Presidential Anti-Graft
Commission, which may involve himself as PCGG Chairman. In such cases, questions on his
impartiality will inevitably be raised. This is the situation that the law seeks to avoid in imposing
the prohibition against holding incompatible offices.

Having thus ruled that Section 7, Article IX-B of the 1987 Constitution enjoins the concurrent
appointments of respondent Elma as PCGG Chairman and CPLC inasmuch as they are
incompatible offices, this Court will proceed to determine whether such appointments violate the
other constitutional provision regarding multiple offices, Section 13, Article VII of the 1987
Constitution.

While Section 7, Article IX-B of the 1987 Constitution applies in general to all elective and
appointive officials, Section 13, Article VII, thereof applies in particular to Cabinet secretaries,
undersecretaries and assistant secretaries. In the Resolution in Civil Liberties Union v. Executive
Secretary,15 this Court already clarified the scope of the prohibition provided in Section 13,
Article VII of the 1987 Constitution. Citing the case of US v. Mouat16, it specifically identified
the persons who are affected by this prohibition as secretaries, undersecretaries and assistant
secretaries; and categorically excluded public officers who merely have the rank of secretary,
undersecretary or assistant secretary.

Another point of clarification raised by the Solicitor General refers to the persons affected by the
constitutional prohibition. The persons cited in the constitutional provision are the "Members of
the Cabinet, their deputies and assistants." These terms must be given their common and general
acceptation as referring to the heads of the executive departments, their undersecretaries and
assistant secretaries. Public officials given the rank equivalent to a Secretary, Undersecretary, or
Assistant Secretary are not covered by the prohibition, nor is the Solicitor General affected
thereby. (Underscoring supplied.)

It is clear from the foregoing that the strict prohibition under Section 13, Article VII of the 1987
Constitution is not applicable to the PCGG Chairman nor to the CPLC, as neither of them is a
secretary, undersecretary, nor an assistant secretary, even if the former may have the same rank
as the latter positions.

It must be emphasized, however, that despite the non-applicability of Section 13, Article VII of
the 1987 Constitution to respondent Elma, he remains covered by the general prohibition under
Section 7, Article IX-B and his appointments must still comply with the standard of
compatibility of officers laid down therein; failing which, his appointments are hereby
pronounced in violation of the Constitution.

Granting that the prohibition under Section 13, Article VII of the 1987 Constitution is applicable
to the present case, the defect in respondent Elma's concurrent appointments to the incompatible
offices of the PCGG Chairman and the CPLC would even be magnified when seen through the
more stringent requirements imposed by the said constitutional provision. In the aforecited case
Civil Liberties Union v. Executive Secretary,17 the Court stressed that the language of Section 13,
Article VII is a definite and unequivocal negation of the privilege of holding multiple offices or
employment. The Court cautiously allowed only two exceptions to the rule against multiple
offices: (1) those provided for under the Constitution, such as Section 3, Article VII, authorizing
the Vice-President to become a member of the Cabinet; or (2) posts occupied by the Executive
officials specified in Section 13, Article VII without additional compensation in an ex-officio
capacity as provided by law and as required by the primary functions of said officials' office. The
Court further qualified that additional duties must not only be closely related to, but must be
required by the official's primary functions. Moreover, the additional post must be exercised in
an ex-officio capacity, which "denotes an act done in an official character, or as a consequence of
office, and without any other appointment or authority than that conferred by the office."18 Thus,
it will not suffice that no additional compensation shall be received by virtue of the second
appointment, it is mandatory that the second post is required by the primary functions of the first
appointment and is exercised in an ex-officio capacity.

With its forgoing qualifications, it is evident that even Section 13, Article VII does not sanction
this dual appointment. Appointment to the position of PCGG Chairman is not required by the
primary functions of the CPLC, and vice versa. The primary functions of the PCGG Chairman
involve the recovery of ill-gotten wealth accumulated by former President Ferdinand E. Marcos,
his family and associates, the investigation of graft and corruption cases assigned to him by the
President, and the adoption of measures to prevent the occurrence of corruption.19 On the other
hand, the primary functions of the CPLC encompass a different matter, that is, the review and/or
drafting of legal orders referred to him by the President.20 And while respondent Elma did not
receive additional compensation in connection with his position as CPLC, he did not act as either
CPLC or PGCC Chairman in an ex-officio capacity. The fact that a separate appointment had to
be made for respondent Elma to qualify as CPLC negates the premise that he is acting in an ex-
officio capacity.

In sum, the prohibition in Section 13, Article VII of the 1987 Constitution does not apply to
respondent Elma since neither the PCGG Chairman nor the CPLC is a Cabinet secretary,
undersecretary, or assistant secretary. Even if this Court assumes, arguendo, that Section 13,
Article VII is applicable to respondent Elma, he still could not be appointed concurrently to the
offices of the PCGG Chairman and CPLC because neither office was occupied by him in an ex-
officio capacity, and the primary functions of one office do not require an appointment to the
other post. Moreover, even if the appointments in question are not covered by Section 13, Article
VII of the 1987 Constitution, said appointments are still prohibited under Section 7, Article IX-
B, which covers all appointive and elective officials, due to the incompatibility between the
primary functions of the offices of the PCGG Chairman and the CPLC.
WHEREFORE, premises considered, this Court partly GRANTS this petition and declares
respondent Magdangal B. Elma's concurrent appointments as PCGG Chairman and CPLC as
unconstitutional. No costs.

SO ORDERED.