Doctrines (Administrative Law)

Definition of Administrative Law

1. LUZON DEV. BANK V. ASSOCIATON OF LDBE G.R. No. 120319

VOLUNTARY ARBITRATORS; STATUS IS THAT OF A QUASI-JUDICIAL INSTRUMENTALITY; DECISIONS APPEALABLE TO

THE COURT OF APPEALS. — In Volkschel Labor Union, et al., v. NLRC, et al., this Court ruled that the awards of voluntary
arbitrators determine the rights of parties; hence, their decisions have the same legal effect as judgments of a court. In
Oceanic Bic Division (FFW), et al. v. Romero, et al., this Court ruled that "a voluntary arbitrator by the nature of her
functions acts in a quasi-judicial capacity." Under these rulings, it follows that the voluntary arbitrator, whether acting
solely or in a panel, enjoys in law the status of a quasi-judicial agency but independent of, and apart from, the NLRC
since his decisions are not appealable to the latter. Section 9 of B.P. Blg. 129, as amended by Republic Act No. 7902,
provides that the Court of Appeals shall exercise exclusive appellate jurisdiction over all judgments, decisions,
resolutions, orders or awards of quasi-judicial agencies and instrumentalities. Governmental "agency" or
"instrumentality" are synonymous. Either of them is a means by which a government acts, or by which a certain
government act or function is performed. The voluntary arbitrator performs a state function pursuant to a governmental
power delegated to him under the provisions in the Labor Code and he falls, therefore, within the contemplation of the
term "instrumentality" in Sec. 9 of B.P. 129. The award or decision of the voluntary arbitrator is equated with that of the
regional trial court. Consequently, in a petition for certiorari from that award or decision, the Court of Appeals must be
deemed to have concurrent jurisdiction with the Supreme Court. As a matter of policy, this Court shall henceforth
remand to the Court of Appeals petitions of this nature for proper disposition. 

2. IRON AND STEEL AUTHORITY v. THE COURT OF APPEALS GR. NO. 102976

POLITICAL LAW; GOVERNMENT AGENCIES OR INSTRUMENTALITIES; INCORPORATED OR NON-INCORPORATED;

CONSEQUENCES OF THE EXPIRATION OF STATUTORY TERM. — It is worth noting that the term "Authority" has been
used to designate both incorporated and non-incorporated agencies or instrumentalities of the Government. When the
statutory term of a non-incorporated agency expires, the powers, duties and functions as well as the assets and liabilities
of that agency revert back to, and are re-assumed by, the Republic of the Philippines, in the absence of special
provisions of law specifying some other disposition thereof such as, e.g., devolution or transmission of such powers,
duties, functions, etc. to some other identified successor agency or instrumentality of the Republic of the Philippines.
When the expiring agency is an incorporated one, the consequences of such expiry must be looked for, in the first
instance, in the charter of that agency and, by way of supplementation, in the provisions of the Corporation Code. The
procedural implications of the relationship between an agent or delegate of the Republic of the Philippines and the
Republic itself are, at least in part, spelled out in the Rules of Court. The general rule is, of course, that an action must be
prosecuted and defended in the name of the real party-in-interest. (Rule 3, Section 2) The Rules of Court at the same
time expressly recognize the role of representative parties.

CONSTITUTIONAL LAW; POWER OF EMINENT DOMAIN; VALID DELEGATION TO THE PRESIDENT IN THE CASE AT BAR.
— While the power of eminent domain is, in principle, vested primarily in the legislative department of the government,
this Court believes and so holds that no new legislative act is necessary should the Republic decide, upon being
substituted for ISA, in fact to continue to prosecute the expropriation proceedings. For the legislative authority, a long
time ago, enacted a continuing or standing delegation of authority to the President of the Philippines to exercise, or
cause the exercise of, the power of eminent domain on behalf of the Government of the Republic of the Philippines. In
the present case, the President, exercising the power duly delegated under both the 1917 and 1987 Revised
Administrative Codes in effect made a determination that it was necessary and advantageous to exercise the power of
eminent domain in behalf of the Government of the Republic and accordingly directed the Solicitor General to proceed
with the suit.

3. PLDT V. CITY OF BACOLOD G.R. NO. 149179

THE BUREAU OF LOCAL GOVERNMENT FINANCE IS NOT AN ADMINISTRATIVE AGENCY WHOSE FINDINGS OF FACT ARE
GIVEN WEIGHT AND DEFERENCE IN COURTS. — PLDT likewise argued in said case that the RTC at Davao City erred in
not giving weight to the ruling of the BLGF which, according to petitioner, is an administrative agency with technical
expertise and mastery over the specialized matters assigned to it. But then again, we held in Davao: To be sure, the BLGF
is not an administrative agency whose findings on questions of fact are given weight and deference in the courts. The
authorities cited by petitioner pertain to the Court of Tax Appeals, a highly specialized court which performs judicial
functions as it was created for the review of tax cases. In contrast, the BLGF was created merely to provide consultative
services and technical assistance to local governments and the general public on local taxation, real property
assessment, and other related matters, among others. The question raised by petitioner is a legal question, to wit, the
interpretation of §23 of R.A. No. 7925. There is, therefore, no basis for claiming expertise for the BLGF that
administrative agencies are said to possess in their respective fields.

Origin and Development of Administrative Law

4. SOLID HOMES VS. PAYAWAL G.R. No. 84811

ADMINISTRATIVE LAW; NATIONAL HOUSING AUTHORITY; EXCLUSIVE JURISDICTION. — The National Housing
Authority shall have exclusive jurisdiction to hear and decide cases of the following nature: A. Unsound real estate
business practices; B. Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer
against the project owner, developer, dealer, broker or salesman; and C. Cases involving specific performance of
contractual and statutory obligations filed by buyers of subdivision lot or condominium unit against the owner,
developer, dealer, broker or salesman.

5. CHRISTIAN GENERAL ASSEMBLY V. IGNACIO G.R. NO. 164789

Criticisms and Advantages of Administrative Law

6. DADUBO V. CSC G.R. No. 106498

CONSTITUTIONAL LAW; CIVIL SERVICE COMMISSION; FINDINGS OF FACTS OF ADMINISTRATIVE BODIES;

CONTROLLING ON THE REVIEWING AUTHORITY IF BASED ON SUBSTANTIAL EVIDENCE. — The rule is that the findings
of fact of administrative bodies, if based on substantial evidence, are controlling on the reviewing authority. It is settled
that it is not for the appellate court to substitute its own judgment for that of the administrative agency on the
sufficiency of the evidence and the credibility of the witnesses. Administrative decisions on matters within their
jurisdiction are entitled to respect and can only be set aside on proof of grave abuse of discretion, fraud or error of law.

PETITIONER'S INVOCATION OF DUE PROCESS IS WITHOUT MERIT; REASON. — The petitioner's invocation of due
process is without merit. Her complaint that she was not sufficiently informed of the charges against her has no basis.
While the rules governing judicial trials should be observed as much as possible, their strict observance is not
indispensable in administrative cases. As this Court has held, "the standard of due process that must be met in
administrative tribunals allows certain latitude as long as the element of fairness is not ignored."
THE CHARGE IN AN ADMINISTRATIVE CASE; THE ALLEGATION OF THE ACTS COMPLAINED OF IS CONTROLLING, NOT
THE DESIGNATION OF THE OFFENSE. — It is true that the petitioner was formally charged with conduct prejudicial to
the best interest of the bank and not specifically with embezzlement. Nevertheless, the allegations and the evidence
presented sufficiently proved her guilt of embezzlement of bank funds, which is unquestionably prejudicial to the best
interest of the bank. The charge against the respondent in an administrative case need not be drafted with the precision
of an information in a criminal prosecution. It is sufficient that he is apprised of the substance of the charge against him;
what is controlling is the allegation of the acts complained of, not the designation of the offense.

THE CONSTITUTIONAL REQUIREMENT TO STATE CLEARLY AND DISTINCTLY THE FACTS AND THE LAW ON WHICH A
DECISION IS BASED; APPLIES ONLY TO COURTS OF JUSTICE AND NOT TO ADMINISTRATIVE BODIES LIKE THE CIVIL
SERVICE COMMISSION — We must also dismiss the petitioner's complaint that CSC Resolution No. 92-878 failed to
comply with the constitutional requirement to state clearly and distinctly the facts and the law on which a decision is
based. We have held that this provision applies only to courts of justice and not to administrative bodies like the Civil
Service Commission. In any event, there was an earlier statement of the facts and the law involved in the decision
rendered by the MSPB dated February 28, 1990, which affirmed DBP's decision to dismiss the petitioner. In both
decisions, the facts and the law on which they were based were clearly and distinctly stated.

7. LIANGA BAY V. ENAGE G.R. No. L-30637

ADMINISTRATIVE LAW; REVISED ADMINISTRATIVE CODE; BUREAU OF FORESTRY; VESTED WITH THE JURISDICTION
AND AUTHORITY OVER DEMARCATION OF ALL PUBLIC FOREST AND FOREST RESERVES. — Respondent Judge erred in
taking cognizance of the complaint filed by respondent Ago, asking for the determination anew of the correct boundary
line of its licensed timber area, for the same issue had already been determined by the Director of Forestry, the
Secretary of Agriculture and Natural Resources and the Office of the President, administrative officials under whose
jurisdictions the matter properly belongs. Section 1816 of the Revised Administrative Code vests in the Bureau of
Forestry, the jurisdiction and authority over the demarcation, protection, management, reproduction, reforestation,
occupancy, and use of all public forests and forest reserves and over the granting of licenses for game and fish, and for
the taking of forest products, including stone and earth therefrom. The Secretary of Agriculture and Natural Resources,
as department head, may repeal or modify the decision of the Director of Forestry when advisable in the public
interests, whose decision is in turn appealable to the Office of the President.

COURTS OF JUSTICE DEVOID OF JURISDICTION TO TAKE COGNIZANCE PURELY ADMINISTRATIVE MATTERS. — In giving
due course to the complaint below, the respondent court would necessarily have to assess and evaluate anew all the
evidence presented in the administrative proceedings, which is beyond its competence and jurisdiction. For the
respondent court to consider and weigh again the evidence already presented and passed upon by said officials would
be to allow it to substitute its judgment for that of said officials who are in a better position to consider and weigh the
same in the light of the authority specifically vested in them by law. Such a posture cannot be entertained, for it is a
well-settled doctrine that the courts of justice will generally not interfere with purely administrative matters which are
addressed to the sound discretion of government agencies and their expertise unless there is a clear showing that the
latter acted arbitrarily or with grave abuse of discretion or when they have acted in a capricious and whimsical manner
such that their action may amount to an excess or lack of jurisdiction.

FINDINGS OF ADMINISTRATIVE BODIES SHALL NOT BE DISTURBED ON APPEAL. — A doctrine long recognized is that
where the law confines in an administrative office the power to determine particular questions or matters, upon the
facts to be presented, the jurisdiction of such office shall prevail over the courts. The general rule, under the principles
of administrative law in force in this jurisdiction, is that decisions of administrative officers shall not be disturbed by the
courts, except when the former have acted without or in excess of their jurisdiction, or with grave abuse of discretion.
Findings of administrative officials and agencies who have acquired expertise because their jurisdiction is confined to
specific matters are generally accorded not only respect but at times even finality of such findings are supported by
substantial evidence. As recently stressed by the Court, "in this era of clogged court dockets, the need for specialized
administrative boards or commissions with the special knowledge, experience and capability to hear and determine
promptly disputes on technical matters or essentially factual matters, subject to judicial review in case of grave abuse of
discretion, has become well-nigh indispensable."

Organization of Administrative Bodies

8. DARIO V. MISON G.R. No. 81954

9. LARIN VS. EXECUTIVE SECRETARY G.R. No. 112745

EXECUTIVE ORDER NO. 127 CANNOT BE CONSIDERED AS THE LEGAL BASIS FOR THE REORGANIZATION OF THE
BUREAU OF INTERNAL REVENUE; REASON. — We cannot consider E.O. No. 127 signed on January 30, 1987 as a legal
basis for the reorganization of the BIR. E.O. No. 127 should be related to the second paragraph of Section 11 of Republic
Act No. 6656. Section 11 provides inter alia: ". . . In the case of the 1987 reorganization of the executive branch, all
departments and agencies which are authorized by executive orders promulgated by the President to reorganize shall
have ninety days from the approval of this act within which to implement their respective reorganization plans in
accordance with the provisions of this Act." Executive Order No. 127 was part of the 1987 reorganization contemplated
under said provision. Obviously, it had become stale by virtue of the expiration of the ninety days deadline period. It
cannot thus be used as a proper basis for the reorganization of the BIR. Nevertheless, as shown earlier, there are other
legal bases to sustain the authority of the President to issue the questioned E.O. No. 132.

WHEN IS REORGANIZATION REGARDED AS VALID? — While the President's power to reorganize cannot be denied, this
does not mean however that the reorganization itself is properly made in accordance with law. Well-settled is the rule
that reorganization is regarded as valid provided it is pursued in good faith. Thus, in Dario vs. Mison, this court has had
the occasion to clarify that: "As a general rule, reorganization is carried out in "good faith" if it is for the purpose of
economy or to make bureaucracy more efficient. In that event no dismissal or separation actually occurs because the
position itself ceases to exist. And in that case the security of tenure would not be a Chinese Wall. Be that as it may, if
the abolition which is nothing else but a separation or removal, is done for political reasons or purposely to defeat
security of tenure, or otherwise not in good faith, no valid abolition takes place and whatever abolition is done is void ab
initio. There is an invalid abolition as where there is merely a change of nomenclature of positions or where claims of
economy are belied by the existence of ample funds."

CIRCUMSTANCES CONSIDERED AS EVIDENCE OF BAD FAITH IN THE REORGANIZATION OF THE BUREAU OF INTERNAL
REVENUE. — In this regard, it is worth mentioning that Section 2 of R.A. No. 6656 lists down the circumstances
evidencing bad faith in the removal of employees as a result of the reorganization. A reading of some of the provisions
of the questioned E.O. No. 132 clearly leads us to an inescapable conclusion that there are circumstances considered as
evidences of bad faith in the reorganization of the BIR. Section 1.1.2 of said executive order provides that: "1.1.2 The
intelligence and Investigation Office and the Inspection Service are abolished. An Intelligence and Investigation Service is
hereby created to absorb the same functions of the abolished office and service. . . ." This provision is a clear illustration
of the circumstance mentioned in Section 2 (b) of R.A. No. 6656 that an office is abolished and another one performing
substantially the same functions created. Another circumstance is the creation of services and divisions in the BIR
resulting to a significant increase in the number of positions in the said bureau as contemplated in paragraph (a) of
Section 2 of R.A. No. 6656. Under Section 1.3 of E.O. No. 132, the Information Systems Group has two newly created
Systems Services. Aside from this, six new divisions are also created. Under Section 1.2.1, three more divisions of the
Assessment Service are formed. With these newly created offices, there is no doubt that a significant increase of
positions will correspondingly follow.

THE NON-REAPPOINTMENT OF THE PETITIONER AS ASSISTANT COMMISSIONER VIOLATES SECTION 4 OF REPUBLIC

ACT NO 6656 — It is perceivable that the non-reappointment of the petitioner as Assistant Commissioner violates
Section 4 of R.A. 6656. Under said provision, officers holding permanent appointments are given preference for
appointment to the new positions in the approved staffing pattern comparable to their former positions or in case there
are not enough comparable positions to positions next lower in rank. It is undeniable that petitioner is a career
executive officer who is holding a permanent position. Hence, he should have been given preference for appointment in
the position of Assistant Commissioner. As claimed by petitioner, Antonio Pangilinan who was one of those appointed as
Assistant Commissioner, "is an outsider of sorts to the bureau, not having been an incumbent officer of the Bureau at
the time of the reorganization." We should not lose sight of the second paragraph of Section 4 of R.A. No. 6656 which
explicitly states that no new employees shall be taken in until all permanent officers shall have been appointed for
permanent position.

10. BUKLOD NG KAWANI EIIB V. ZAMORA G.R. No. 142801

ADMINISTRATIVE LAW; PUBLIC OFFICE; "DEACTIVATE" AND "ABOLISH," DISTINGUISHED. — Surely, there exists a
distinction between the words "deactivate" and "abolish." To "deactivate" means to render inactive or ineffective or to
break up by discharging or reassigning personnel, while to "abolish" means to do away with, to annul, abrogate or
destroy completely. In essence, abolition denotes an intention to do away with the office wholly and permanently. Thus,
while in abolition, the office ceases to exist, the same is not true in deactivation where the office continues to exist,
albeit remaining dormant or inoperative. Be that as it may, deactivation and abolition are both reorganization measures.

POWER TO ABOLISH PUBLIC OFFICE, AS A GENERAL RULE, LODGED WITH THE LEGISLATURE. — The general rule has
always been that the power to abolish a public office is lodged with the legislature. This proceeds from the legal precept
that the power to create includes the power to destroy. A public office is either created by the Constitution, by statute,
or by authority of law. Thus, except where the office was created by the Constitution itself, it may be abolished by the
same legislature that brought it into existence.

EXCEPTION. — The exception, however, is that as far as bureaus, agencies or offices in the executive department are
concerned, the President's power of control may justify him to inactivate the functions of a particular office, or certain
laws may grant him the broad authority to carry out reorganization measures. The case in point is Larin v. Executive
Secretary.

CONSTITUTIONAL LAW; PRESIDENT; WITH AUTHORITY TO EFFECT ORGANIZATIONAL CHANGES, INCLUDING

ABOLITION, IN EXECUTIVE DEPARTMENT OR AGENCY; BASIS — We adhere to the precedent or ruling in Larin that this
provision recognizes the authority of the President to effect organizational changes in the department or agency under
the executive structure. Such a ruling further finds support in Section 78 of Republic Act No. 8760. Under this law, the
heads of departments, bureaus, offices and agencies and other entities in the Executive Branch are directed (a) to
conduct a comprehensive review of their respective mandates, missions, objectives, functions, programs, projects,
activities and systems and procedures; (b) identify activities which are no longer essential in the delivery of public
services and which may be scaled down, phased-out or abolished; and (c) adopt measures that will result in the
streamlined organization and improved overall performance of their respective agencies. Section 78 ends up with the
mandate that the actual streamlining and productivity improvement in agency organization and operation shall be
effected pursuant to Circulars or Orders issued for the purpose by the Office of the President. The law has spoken
clearly. We are left only with the duty to sustain. But of course, the list of legal basis authorizing the President to
reorganize any department or agency in the executive branch does not have to end here. We must not lose sight of the
very source of the power — that which constitutes an express grant of power. Under Section 31, Book III of Executive
Order No. 292 (otherwise known as the Administrative Code of 1987), "the President, subject to the policy in the
Executive Office and in order to achieve simplicity, economy and efficiency, shall have the continuing authority to
reorganize the administrative structure of the Office of the President." For this purpose, he may transfer the functions of
other Departments or Agencies to the Office of the President. In Canonizado v. Aguirre, we ruled that reorganization
"involves the reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy
of functions." It takes place when there is an alteration of the existing structure of government offices or units therein,
including the lines of control, authority and responsibility between them. The EIIB is a bureau attached to the
Department of Finance. It falls under the Office of the President. Hence, it is subject to the President's continuing
authority to reorganize.

ADMINISTRATIVE LAW; PUBLIC OFFICE; REORGANIZATION CARRIED OUT IN GOOD FAITH, VALID. — In this jurisdiction,
reorganizations have been regarded as valid provided they are pursued in good faith. Reorganization is carried out in
'good faith' if it is for the purpose of economy or to make bureaucracy more efficient.

DEACTIVATION OF EIIB AND CREATION OF TASK FORCE ADUANA, MADE IN GOOD FAITH. — An examination of the
pertinent Executive Orders shows that the deactivation of EIIB and the creation of Task Force Aduana were done in good
faith. It was not for the purpose of removing the EIIB employees, but to achieve the ultimate purpose of E.O. No. 191,
which is economy. While Task Force Aduana was created to take the place of EIIB, its creation does not entail expense to
the government. There is no employment of new personnel to man the Task Force. E.O. No. 196 provides that the
technical, administrative and special staffs of EIIB are to be composed of people who are already in the public service,
they being employees of other existing agencies. Obviously, the idea is to encourage the utilization of personnel,
facilities and resources of the already existing departments, agencies, bureaus, etc., instead of maintaining an
independent office with a whole set of personnel and facilities. It is evident from the yearly budget appropriation of the
government that the creation of the Task Force Aduana was especially intended to lessen EIIB's expenses.

ABOLITION OF OFFICE; DOES NOT CURTAIL RIGHT TO SECURITY OF TENURE. — We hold that petitioners' right to
security of tenure is not violated. Nothing is better settled in our law than that the abolition of an office within the
competence of a legitimate body if done in good faith suffers from no infirmity. Valid abolition of offices is neither
removal nor separation of the incumbents.

EXCEPT IN CONSTITUTIONAL OFFICES, NO ONE HAS VESTED RIGHT IN AN OFFICE OR ITS SALARY. — Indeed, there is no
such thing as an absolute right to hold office. Except constitutional offices which provide for special immunity as regards
salary and tenure, no one can be said to have any vested right in an office or its salary.

11. DOMINGO VS. ZAMORA G.R. No. 142283

POLITICAL LAW; ADMINISTRATIVE CODE OF 1987; EO 81 IS A VALID EXERCISE OF THE PRESIDENT'S DELEGATED POWER
TO REORGANIZE THE OFFICE OF THE PRESIDENT. — Executive Order No. 292 ("EO 292" for brevity), otherwise known as
the Administrative Code of 1987, expressly grants the President continuing authority to reorganize the Office of the
President. Under Section 31. . . Since EO 81 is based on the President's continuing authority under Section 31 (2) and (3)
of EO 292, EO 81 is a valid exercise of the President's delegated power to reorganize the Office of the President. The law
grants the President this power in recognition of the recurring need of every President to reorganize his office "to
achieve simplicity, economy and efficiency." The Office of the President is the nerve center of the Executive Branch. To
remain effective and efficient, the Office of the President must be capable of being shaped and reshaped by the
President in the manner he deems fit to carry out his directives and policies. After all, the Office of the President is the
command post of the President. This is the rationale behind the President's continuing authority to reorganize the
administrative structure of the Office of the President. Petitioners' contention that the DECS is not part of the Office of
the President is immaterial. Under EO 292, the DECS is indisputably a Department of the Executive Branch. Even if the
DECS is not part of the Office of the President, Section 31 (2) and (3) of EO 292 clearly authorizes the President to
transfer any function or agency of the DECS to the Office of the President. Under its charter, the PSC is attached to the
Office of the President. Therefore, the President has the authority to transfer the "functions, programs and activities of
DECS related to sports development" to the PSC, making EO 81 a valid presidential issuance.

DISTINGUISHED FROM THE PRESIDENT'S POWER TO REORGANIZE THE OFFICE OF THE PRESIDENT PROPER; CASE AT
BAR. — However, the President's power to reorganize the Office of the President under Section 31 (2) and (3) of EO 292
should be distinguished from his power to reorganize the Office of the President Proper. Under Section 31 (1) of EO 292,
the President can reorganize the Office of the President Proper by abolishing, consolidating or merging units, or by
transferring functions from one unit to another. In contrast, under Section 31 (2) and (3) of EO 292, the President's
power to reorganize offices outside the Office of the President Proper but still within the Office of the President is
limited to merely transferring functions or agencies from the Office of the President to Departments or Agencies, and
vice versa. This distinction is crucial as it affects the security of tenure of employees. The abolition of an office in good
faith necessarily results in the employee's cessation in office, but in such event there is no dismissal or separation
because the office itself ceases to exist. On the other hand, the transfer of functions or agencies does not result in the
employee's cessation in office because his office continues to exist although in another department, agency or office. In
the instant case, the BPESS employees who were not transferred to PSC were at first temporarily, then later
permanently reassigned to other offices of the DECS, ensuring their continued employment. At any rate, RA 9155 now
mandates that these employees "shall be retained by the Department."

12. BAGAOISAN V. NTA G.R. No. 152845

POLITICAL LAW; EXECUTIVE DEPARTMENT; PRESIDENT IS EXPRESSLY GRANTED CONTROL THEREOF; APPLICATION IN
CASE AT BAR. — It is important to emphasize that the questioned Executive Orders No. 29 and No. 36 have not
abolished the National Tobacco Administration but merely mandated its reorganization through the streamlining or
reduction of its personnel. Article VII, Section 17, of the Constitution, expressly grants the President control of all
executive departments, bureaus, agencies and offices which may justify an executive action to inactivate the functions of
a particular office or to carry out reorganization measures under a broad authority of law. Section 78 of the General
Provisions of Republic Act No. 8522 (General Appropriations Act of FY 1998) has decreed that the President may direct
changes in the organization and key positions in any department, bureau or agency pursuant to Article VI, Section 25, of
the Constitution, which grants to the Executive Department the authority to recommend the budget necessary for its
operation. Evidently, this grant of power includes the authority to evaluate each and every government agency,
including the determination of the most economical and efficient staffing pattern, under the Executive Department. In
the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon. Ronaldo D. Zamora, in his capacity as the Executive Secretary,
et al., this Court has had occasion to also delve on the President's power to reorganize the Office of the President under
Section 31(2) and (3) of Executive Order No. 292 and the power to reorganize the Office of the President Proper. The
Court has there .observed: ". . . .Under Section 31(1) of EO 292, the President can reorganize the Office of the President
Proper by abolishing, consolidating or merging units, or by transferring functions from one unit to another. In contrast,
under Section 31(2) and (3) of EO 292, the President's power to reorganize offices outside the Office of the President
Proper but still within the Office of the President is limited to merely transferring functions or agencies from the Office
of the President to Departments or Agencies, and vice versa." The provisions of Section 31, Book III, Chapter 10, of
Executive Order No. 292 (Administrative Code of 1987), above-referred to, reads thusly: "SEC. 31. Continuing Authority
of the President to Reorganize his Office. — The President, subject to the policy in the Executive Office and in order to
achieve simplicity, economy and efficiency, shall have continuing authority to reorganize the administrative structure of
the Office, of the President. For this purpose, he may take any of the following actions: "(1) Restructure the internal
organization of the Office of the President Proper, including the immediate Offices, the Presidential Special
Assistants/Advisers System and the Common Staff Support System, by abolishing, consolidating or merging units thereof
or transferring functions from one unit to another; "(2) Transfer any function under the Office of the President to any
other Department or Agency as well as transfer functions to the Office of the President from other Departments and
Agencies; and "(3) Transfer any agency under the Office of the President to any other department or agency as well as
transfer agencies to the Office of the President from other departments and agencies." The first sentence of the law is
an express grant to the President of a continuing authority to reorganize the administrative structure of the Office of the
President. The succeeding numbered paragraphs are not in the nature of provisos that unduly limit the aim and scope of
the grant to the President of the power to reorganize but are to be viewed in consonance therewith. Section 31(1) of
Executive Order No. 292 specifically refers to the President's power to restructure the internal organization of the Office
of the President Proper, by abolishing, consolidating or merging units hereof or transferring functions from one unit to
another, while Section 31(2) and (3) concern executive offices outside the Office of the President Proper allowing the
President to transfer any function under the Office of the President to any other Department or Agency and vice-versa,
and the transfer of any agency under the Office of the President to any other department or agency and vice-versa. In
the present instance, involving neither an abolition nor transfer of offices, the assailed action is a mere reorganization
under the general provisions of the law consisting mainly of streamlining the NTA in the interest of simplicity, economy
and efficiency. It is an act well within the authority of President motivated and carried out, according to the findings of
the appellate court, in good faith, a factual assessment that this Court could only but accept.

Scope of Powers

13. MAKATI STOCK EXCHANGE V. SEC G.R. No. L-23004

SECURITIES AND EXCHANGE COMMISSION; MAY NOT PROHIBIT DOUBLE LISTING OF SECURITIES IN STOCK
EXCHANGES. — The Securities and Exchange Commission's rule that a security already listed in any securities exchange
may not be listed anew in any other securities exchange is beyond the power of the Commission to impose because it
results in discrimination and violation of constitutional rights.

PROHIBITION AGAINST DOUBLE LISTING AS CONDITION FOR LICENSING OF STOCK EXCHANGE — The Securities and
Exchange Commission may not validly impose as a condition precedent for the licensing of a stock exchange its rule
against double listing of securities.

14. SOLID HOMES VS. PAYAWAL G.R. No. 84811

STATUTES CONFERRING POWERS ON ADMINISTRATIVE AGENCIES, LIBERALLY CONSTRUED. — Statutes conferring

powers on their administrative agencies must be liberally construed to enable them to discharge their assigned duties in
accordance with the legislative purpose.

15. TAULE VS. SANTOS G.R. No. 90336

SECRETARY OF LOCAL GOVERNMENT; WITHOUT JURISDICTION TO ENTERTAIN PROTESTS INVOLVING THE ELECTION
OF OFFICERS OF THE FABC. — The Secretary of Local Government is not vested with jurisdiction to entertain any protest
involving the election of officers of the FABC. There is no question that he is vested with the power to promulgate rules
and regulations as set forth in Section 222 of the Local Government Code. Likewise, under Book IV, Title XII, Chapter 1,
Sec. 3(2) of the Administrative Code of 1987, the respondent Secretary has the power to "establish and prescribe rules,
regulations and other issuances and implementing laws on the general supervision of local government units and on the
promotion of local autonomy and monitor compliance thereof by said units." Also, the respondent Secretary's rule
making power is provided in Sec. 7, Chapter II, Book IV of the Administrative Code. Thus, DLG Circular No. 89-09 was
issued by respondent Secretary in pursuance of his rule-making power conferred by law and which now has the force
and effect of law. It is a well-settled principle of administrative law that unless expressly empowered, administrative
agencies are bereft of quasi-judicial powers. The jurisdiction of administrative authorities is dependent entirely upon the
provisions of the statutes reposing power in them; they cannot confer it upon themselves. Such jurisdiction is essential
to give validity to their determinations. There is neither a statutory nor constitutional provision expressly or even by
necessary implication conferring upon the Secretary of Local Government the power to assume jurisdiction over an
election protest involving officers of the katipunan ng mga barangay.

GENERAL SUPERVISION OF THE CHIEF EXECUTIVE; CONCEPT. — Presidential power over local governments is limited by
the Constitution to the exercise of general supervision "to ensure that local affairs are administered according to law."
The general supervision is exercised by the President through the Secretary of Local Government. In administrative law,
supervision means overseeing or the power or authority of an officer to see that the subordinate officers perform their
duties. If the latter fails or neglects 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 had done in the performance of his duties and to substitute the judgment of the former
for that of the latter. The fundamental law permits the Chief Executive to wield no more authority than that of checking
whether said local government or the officers thereof perform their duties as provided by statutory enactments. Hence,
the President cannot interfere with local governments so long as the same or its officers 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.

CONSTITUTIONAL LIMITATION DEPRIVES SECRETARY OF LOCAL GOVERNMENT AUTHORITY TO PASS UPON VALIDITY
OR REGULARITY OF THE ELECTION OF THE OFFICERS OF THE KATIPUNAN. — Construing the constitutional limitation on
the power of general supervision of the President over local governments, We hold that respondent Secretary has no
authority to pass upon the validity or regularity of the election of the officers of the katipunan. To allow respondent
Secretary to do so will give him more power than the law or the Constitution grants. It will in effect give him control over
local government officials for it will permit him to interfere in a purely democratic and non-partisan activity aimed at
strengthening the barangay as the basic component of local governments so that the ultimate goal of fullest autonomy
may be achieved. In fact, his order that the new elections to be conducted be presided by the Regional Director is a clear
and direct interference by the Department with the political affairs of the barangays which is not permitted by the
limitation of presidential power to general supervision over local governments.