G.R. No. 177131. June 7, 2011.

*
BOY SCOUTS OF THE PHILIPPINES, petitioner, vs. COMMISSION ON AUDIT, respondent.
FACTS: The Commission on Audit issued COA Resolution No. 99-011 in which the said resolution
state that the BSP was created as a public corporation under Commonwealth Act No. 111, as
amended by Presidential Decree No. 460 and Republic Act No. 7278; that in Boy Scouts of the
Philippines vs. National Labor Relations Commission, the Supreme Court ruled that the BSP, as
constituted under its charter, was a “government-controlled corporation within the meaning of
Article IX (B)(2)(1) of the Constitution; and that “the BSP is appropriately regarded as a government
instrumentality under the 1987 Administrative Code.”
The BSP sought reconsideration of the COA Resolution in a letter signed by the BSP National
President Jejomar Binay. He claimed that RA 7278 eliminated the “substantial government
participation” in the National Executive Board by removing: (i) the President of the Philippines and
executive secretaries, with the exception of the Secretary of Education, as members thereof; and
(ii) the appointment and confirmation power of the President of the Philippines, as Chief Scout,
over the members of the said Board.
The BSP further claimed that the 1987 Administrative Code itself, of which the BSP s. NLRC relied
on for some terms, defines government-owned and controlled corporations as agencies organized
as stock or non-stock corporations which the BSP, under its present charter, is not. And finally,
they claim that the Government, like in other GOCCs, does not have funds invested in the BSP.
The BSP is not an entity administering special funds. The BSP is neither a unit of the Government;
a department which refers to an executive department as created by law; nor a bureau which
refers to any principal subdivision or unit of any department.
ISSUE: Whether the BSP falls under the COA’s audit jurisdiction.
RULING: After considering the legislative history of the amended charter and the applicable laws
and the arguments of both parties, the Court found that the BSP is a public corporation and its
funds are subject to the COA’s audit jurisdiction. The BSP Charter created the BSP as a “public
corporation” to serve the following public interest or purpose: xxx to promote through organization
and cooperation with other agencies, the ability of boys to do useful things for themselves and
others, to train them in scout craft, and to inculcate in them patriotism, civic consciousness and
responsibility, courage, self-reliance, discipline and kindred virtues, and moral values, using the
method which are in common use by boy scouts.
The BSP is a public corporation or a government agency or instrumentality with juridical
personality, which does not fall within the constitutional prohibition in Article XII, Section 16,
notwithstanding the amendments to its charter. Not all corporations, which are not government
owned or controlled, are ipso facto to be considered private corporations as there exist another
distinct class of corporations or chartered institutions which are otherwise known as “public
corporations.” These corporations are treated by law as agencies or instrumentalities of the
government which are not subject to the test of ownership or control and economic viability but
to different criteria relating to their public purposes/interests or constitutional policies and
objectives and their administrative relationship to the government or any of its Departments or
Offices.
Since BSP, under its amended charter, continues to be a public corporation or a government
instrumentality, the Court concludes that it is subject to the exercise by the COA of its audit
jurisdiction in the manner consistent with the provisions of the BSP Charter.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 1

G.R. No. 80391. February 28, 1989.*
SULTAN ALIMBUSAR P. LIMBONA, petitioner, vs. CONTE MANGELIN, SALIC ALI, SALINDATO
ALI, PILIMPINAS CONDING, ACMAD TOMAWIS, GERRY TOMAWIS, JESUS ORTIZ, ANTONIO
DELA FUENTE, DIEGO PALOMARES, JR., RAKIL DAGALANGIT, and BIMBO SINSUAT,
respondents.
Facts: Petitioner, Sultan Alimbusar Limbona, was elected Speaker of the Regional Legislative
Assembly or Batasang Pampook of Central Mindanao (Assembly). On October 21, 1987
Congressman Datu Guimid Matalam, Chairman of the Committee on Muslim Affairs of the House
of Representatives, invited petitioner in his capacity as Speaker of the Assembly of Region XII in a
consultation/dialogue with local government officials. Petitioner accepted the invitation and
informed the Assembly members through the Assembly Secretary that there shall be no session
in November as his presence was needed in the house committee hearing of Congress. However,
on November 2, 1987, the Assembly held a session in defiance of the Limbona's advice, where he
was unseated from his position. Petitioner prays that the session's proceedings be declared null
and void and be it declared that he was still the Speaker of the Assembly. Pending further
proceedings of the case, the SC received a resolution from the Assembly expressly expelling
petitioner's membership therefrom. Respondents argue that petitioner had "filed a case before the
Supreme Court against some members of the Assembly on a question which should have been
resolved within the confines of the Assembly," for which the respondents now submit that the
petition had become "moot and academic" because its resolution.
Issue: Whether or not the courts of law have jurisdiction over the autonomous governments or
regions. What is the extent of self-government given to the autonomous governments of Region XII
Held: 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". 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" over them, but only to "ensure
that local affairs are administered according to law." He has no control over their acts in the sense
that he can substitute their judgments with his own. Decentralization of power, on the other hand,
involves an abdication of political power in the favor of local governments 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.
An autonomous government that enjoys autonomy of the latter category [CONST. (1987), Art. X,
Sec. 15.] is subject alone to the decree of the organic act creating it and accepted principles on the
effects and limits of "autonomy." On the other hand, an autonomous government of the former
class is, as we noted, under the supervision of the national government acting through the
President (and the Department of Local Government). If the Sangguniang Pampook (of Region XII),
then, is autonomous in the latter sense, its acts are, debatably beyond the domain of this Court
in perhaps the same way that the internal acts, say, of the Congress of the Philippines are beyond
our jurisdiction. But if it is autonomous in the former category only, it comes unarguably under
our jurisdiction. An examination of the very Presidential Decree creating the autonomous
governments of Mindanao persuades us that they were never meant to exercise autonomy in the
second sense (decentralization of power). PD No. 1618, in the first place, mandates that "[t]he
President shall have the power of general supervision and control over Autonomous Regions."
Hence, we assume jurisdiction. And if we can make an inquiry in the validity of the expulsion in
question, with more reason can we review the petitioner's removal as Speaker.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 2

G.R. No. 91649. May 14, 1991.*
ATTORNEYS HUMBERTO BASCO, EDILBERTO BALCE, SOCRATES MARANAN AND LORENZO
SANCHEZ, petitioners, vs. PHILIPPINE AMUSEMENTS AND GAMING CORPORATION
(PAGCOR), respondent.
Facts: Petitioner is seeking to annul the Philippine Amusement and Gaming Corporation
(PAGCOR) Charter -- PD 1869, because it is allegedly contrary to morals, public policy and order,
and because it constitutes a waiver of a right prejudicial to a third person with a right recognized
by law. It waived the Manila Cit government’s right to impose taxes and license fees, which is
recognized by law. For the same reason, the law has intruded into the local government’s right to
impose local taxes and license fees. This is in contravention of the constitutionally enshrined
principle of local autonomy.
Issue: Whether or not Presidential Decree No. 1869 is valid.
Ruling:
1. The City of Manila, being a mere Municipal corporation has no inherent right to impose taxes.
Their charter or statute must plainly show an intent to confer that power, otherwise the
municipality cannot assume it. Its power to tax therefore must always yield to a legislative act
which is superior having been passed upon by the state itself which has the “inherent power to
tax.”
The Charter of Manila is subject to control by Congress. It should be stressed that “municipal
corporations are mere creatures of Congress”, which has the power to “create and abolish
municipal corporations” due to its “general legislative powers”. Congress, therefore, has the power
of control over the Local governments. And if Congress can grant the City of Manila the power to
tax certain matters, it can also provide for exemptions or even take back the power.
2. The City of Manila’s power to impose license fees on gambling, has long been revoked by P.D.
No. 771 and vested exclusively on the National Government. Therefore, only the National
Government has the power to issue “license or permits” for the operation of gambling.
3. Local governments have no power to tax instrumentalities of the National Government. PAGCOR
is government owned or controlled corporation with an original charter, P.D. No. 1869. All of its
shares of stocks are owned by the National Government. PAGCOR has a dual role, to operate and
to regulate gambling casinos. The latter role is governmental, which places it in the category of an
agency or instrumentality of the Government. Being an instrumentality of the Government,
PAGCOR should be and actually is exempt from local taxes. Otherwise, its operation might be
burdened, impeded or subjected to control by a mere Local Government.
4. Petitioners also argue that the Local Autonomy Clause of the Constitution will be violated by
P.D. No. 1869.
Article 10, Section 5 of the 1987 Constitution:
“Each local government unit shall have the power to create its own source of revenue and to levy
taxes, fees, and other charges subject to such guidelines and limitation as the congress may
provide, consistent with the basic policy on local autonomy. Such taxes, fees and charges shall
accrue exclusively to the local government.”
SC said this is a pointless argument. The power of the local government to “impose taxes and fees”
is always subject to “limitations” which Congress may provide by law. Besides, the principle of
local autonomy under the 1987 Constitution simply means “decentralization.” It does not make
local governments sovereign within the state.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 3

G.R. No. 129093. August 30, 2001.*
HON. JOSE D. LINA, JR., SANGGUNIANG PANLALAWIGAN OF LAGUNA, and HON. CALIXTO
CATAQUIZ, petitioners, vs. HON. FRANCISCO DIZON PAÑO and TONY CALVENTO,
respondents.
FACTS: On December 29, 1995, respondent Tony Calvento was appointed agent by the Philippine
Charity Sweepstakes Office (PCSO) to install Terminal OM 20 for the operation of lotto. He asked
Mayor Calixto Cataquiz, Mayor of San Pedro, Laguna, for a mayor’s permit to open the lotto outlet.
This was denied by Mayor Cataquiz in a letter dated February 19, 1996. The ground for said
denial was an ordinance passed by the Sangguniang Panlalawigan of Laguna entitled Kapasiyahan
Blg. 508, T. 1995which was issued on September 18, 1995.As a result of this resolution of denial,
respondent Calvento filed a complaint for declaratory relief with prayer for preliminary injunction
and temporary restraining order. In the said complaint, respondent Calvento asked the Regional
Trial Court of San Pedro Laguna, Branch 93, for the following reliefs: (1) a preliminary injunction
or temporary restraining order, ordering the defendants to refrain from implementing or enforcing
Kapasiyahan Blg. 508, T. 1995; (2) an order requiring Hon. Municipal Mayor Calixto R. Cataquiz
to issue a business permit for the operation of a lotto outlet; and (3) an order annulling or declaring
as invalid Kapasiyahan Blg. 508, T. 1995.On February 10, 1997, the respondent judge, Francisco
Dizon Paño, promulgated his decision enjoining the petitioners from implementing or enforcing
resolution or Kapasiyahan Blg. 508, T. 1995.
ISSUE: WON Kapasiyahan Blg. 508, T. 1995 is valid
HELD: As a policy statement expressing the local government’s objection to the lotto, such
resolution is valid. This is part of the local government’s autonomy to air its views which may be
contrary to that of the national government’s. However, this freedom to exercise contrary views
does not mean that local governments may actually enact ordinances that go against laws duly
enacted by Congress. Given this premise, the assailed resolution in this case could not and should
not be interpreted as a measure or ordinance prohibiting the operation of lotto.n our system of
government, the power of local government units to legislate and enact ordinances and resolutions
is merely a delegated power coming from Congress. As held in Tatel vs. Virac, ordinances should
not contravene an existing statute enacted by Congress. The reasons for this is obvious, as
elucidated in Magtajas v. Pryce Properties Corp.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 4

G.R. No. 79956. January 29, 1990.*
CORDILLERA BROAD COALITION, petitioner, vs. COMMISSION ON AUDIT, respondent.
Facts: Pursuant to a ceasefire agreement signed on September 13, 1986, the Cordillera People’s
Liberation Army (CPLA) and the Cordillera Bodong Administration agreed that the Cordillera
people shall not undertake their demands through armed and violent struggle but by peaceful
means, such as political negotiations.
A subsequent joint agreement was then arrived at by the two parties. Such agreement states that
they are to:
Par. 2. Work together in drafting an Executive Order to create a preparatory body that
could perform policy-making and administrative functions and undertake consultations
and studies leading to a draft organic act for the Cordilleras.
Par. 3. Have representatives from the Cordillera panel join the study group of the R.P. Panel
in drafting the Executive Order.
Pursuant to the above joint agreement, E.O. 220 was drafted by a panel of the Philippine
government and of the representatives of the Cordillera people. This was then signed into law by
President Corazon Aquino, in the exercise of her legislative powers, creating the Cordillera
Administrative Region [CAR], which covers the provinces of Abra, Benguet, Ifugao, Kalinga-Apayao
and Mountain Province and the City of Baguio.
Petitioners assail the constitutionality of E.O. 220 on the primary ground that by issuing the said
order, the President, in the exercise of her legislative powers, had virtually pre-empted Congress
from its mandated task of enacting an organic act and created an autonomous region in the
Cordilleras.
Issue: Whether or not E.O. 220 is constitutional
Ruling: The Supreme Court has come to the conclusion that petitioners’ are unfounded.
E.O. 220 does not create the autonomous region contemplated in the Constitution. It merely
provides for transitory measures in anticipation of the enactment of an organic act and the creation
of an autonomous region. In short, it prepares the ground for autonomy. This does not necessarily
conflict with the provisions of the Constitution on autonomous regions.
The Constitution outlines a complex procedure for the creation of an autonomous region in the
Cordilleras. Since such process will undoubtedly take time, the President saw it fit to provide for
some measures to address the urgent needs of the Cordilleras in the meantime that the organic
act had not yet been passed and the autonomous region created. At this time, the President was
still exercising legislative powers as the First Congress had not yet convened.
Based on Article X Section 18 of the Constitution (providing the basic structure of government in
the autonomous region), the Supreme Court finds that E. O. No. 220 did not establish an
autonomous regional government. The bodies created by E. O. No. 220 do not supplant the
existing local governmental structure; nor are they autonomous government agencies. They merely
constitute the mechanism for an "umbrella" that brings together the existing local governments,
the agencies of the National Government, the ethno-linguistic groups or tribes and non-
governmental organizations in a concerted effort to spur development in the Cordilleras.
In fact, it was Republic Act No. 6766, the organic act for the Cordillera autonomous region signed
into law on October 23, 1989, and the plebiscite for the approval of the act which completed the
autonomous region-creating process outlined in the Constitution.
Therefore, E.O. 220 is constitutional.
PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 5
G.R. No. 195770. July 17, 2012.*
AQUILINO Q. PIMENTEL, JR., SERGIO TADEO and NELSON ALCANTARA, petitioners, vs.
EXECUTIVE SECRETARY PAQUITO N. OCHOA and SECRETARY CORAZON JULIANO-
SOLIMAN OF THE DEPARTMENT OF SOCIAL WELFARE and DEVELOPMENT, respondents.
Facts:
• The petioner assets the validity of certain provisions of Republic Act No. 10147 or the General
Appropriations Act (GAA) of 20111 which provides a P21 Billion budget allocation for the
Conditional Cash Transfer Program (CCTP) headed by the Department of Social Welfare &
Development (DSWD). Petitioners seek to enjoin respondents Executive Secretary Paquito N.
Ochoa and DSWD Secretary Corazon Juliano-Soliman from implementing the said program on
the ground that it amounts to a "recentralization" of government functions that have already
been devolved from the national government to the local government units.
• Petitioners admit that the wisdom of adopting the CCTP as a poverty reduction strategy for the
Philippines is with the legislature. They take exception, however, to the manner by which it is
being implemented, that is, primarily through a national agency like DSWD instead of the
LGUs to which the responsibility and functions of delivering social welfare, agriculture and
health care services have been devolved pursuant to Section 17 of Republic Act No. 7160, also
known as the Local Government Code of 1991, in relation to Section 25, Article II & Section 3,
Article X of the 1987 Constitution.
• Petitioners assert that giving the DSWD full control over the identification of beneficiaries and
the manner by which services are to be delivered or conditionalities are to be complied with,
instead of allocating the P21 Billion CCTP Budget directly to the LGUs that would have
enhanced its delivery of basic services, results in the "recentralization" of basic government
functions, which is contrary to the precepts of local autonomy and the avowed policy of
decentralization.
Issue: Whether or not the 21 billion budget allocation of Conditional Cash Transfer violates Article
2, Section 2 of Article 10, section 6 of the 1987 Philippine constitution in relation of section 17 of
the Local Government Code of 1991?
Held:
• Petition is dismissed. 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.
• Every law has in its favor the presumption of constitutionality, and to justify its nullification,
there must be a clear and unequivocal breach of the Constitution, not a doubtful and
argumentative one.23 Petitioners have failed to discharge the burden of proving the invalidity
of the provisions under the GAA of 2011. The allocation of a P21 billion budget for an
intervention program formulated by the national government itself but implemented in
partnership with the local government units to achieve the common national goal development
and social progress can by no means be an encroachment upon the autonomy of local
governments.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 6

G.R. Nos. 120865-71. December 7, 1995.*
LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner, vs. COURT OF APPEALS
FACTS: The Laguna Lake Development Authority (LLDA) was created through Republic Act No. 4850.
It was granted, inter alia, exclusive jurisdiction to issue permits for the use of all surface water for any
project or activity in or affecting the said region including navigation, construction, and operation of
fishpens, fish enclosures, fish corrals and the like.
Then came RA 7160, the Local Government Code of 1991. The municipalities in the Laguna Lake region
interpreted its provisions to mean that the newly passed law gave municipal governments the exclusive
jurisdiction to issue fishing privileges within their municipal waters.
ISSUE: Who should exercise jurisdiction over the Laguna Lake and its environs insofar as the issuance
of permits for fishing privileges is concerned, the LLDA or the towns and municipalities comprising the
region?
HELD: LLDA has jurisdiction over such matters because the charter of the LLDA prevails over the
Local Government Code of 1991. The said charter constitutes a special law, while the latter is a general
law. It is basic in statutory construction that the enactment of a later legislation which is a general
law, cannot be construed to have repealed a special law. The special law is to be taken as an exception
to the general law in the absence of special circumstances forcing a contrary conclusion. In addition,
the charter of the LLDA embodies a valid exercise of police power for the purpose of protecting and
developing the Laguna Lake region, as opposed to the Local Government Code, which grants powers
to municipalities to issue fishing permits for revenue purposes.
G.R. No. 135962. March 27, 2000.*
METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. BEL-AIR VILLAGE
ASSOCIATION, INC., respondent.
Facts: Metropolitan Manila Development Authority (MMDA), petitioner herein, is a Government
Agency tasked with the delivery of basic services in Metro Manila. Bel-Air Village Association (BAVA),
respondent herein, received a letter of request from the petitioner to open Neptune Street of Bel-Air
Village for the use of the public. The said opening of Neptune Street will be for the safe and convenient
movement of persons and to regulate the flow of traffic in Makati City. This was pursuant to MMDA
law or Republic Act No. 7924. On the same day, the respondent was appraised that the perimeter
wall separating the subdivision and Kalayaan Avenue would be demolished. The respondent, to stop
the opening of the said street and demolition of the wall, filed a preliminary injunction and a
temporary restraining order. Respondent claimed that the MMDA had no authority to do so and the
lower court decided in favor of the Respondent. Petitioner appealed the decision of the lower courts
and claimed that it has the authority to open Neptune Street to public traffic because it is an agent
of the State that can practice police power in the delivery of basic services in Metro Manila.
Issue: Whether or not the MMDA has the mandate to open Neptune Street to public traffic pursuant
to its regulatory and police powers.
Held: The Court held that the MMDA does not have the capacity to exercise police power. Police power
is primarily lodged in the National Legislature. However, police power may be delegated to government
units. Petitioner herein is a development authority and not a political government unit. Therefore, the
MMDA cannot exercise police power because it cannot be delegated to them.
It is not a legislative unit of the government. Republic Act No. 7924 does not empower the MMDA to
enact ordinances, approve resolutions and appropriate funds for the general welfare of the
inhabitants of Manila. There is no syllable in the said act that grants MMDA police power. It is an
agency created for the purpose of laying down policies and coordinating with various national
government agencies, people’s organizations, non-governmental organizations and the private sector
for the efficient and expeditious delivery of basic services in the vast metropolitan area.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 7

G.R. No. 149848. November 25, 2004.*
ARSADI M. DISOMANGCOP and RAMIR M. DIMALOTANG, petitioners, vs. THE SECRETARY
OF THE DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS, SIMEON A. DATUMANONG and
THE SECRETARY OF BUDGET and MANAGEMENT EMILIA T. BONCODIN, respondents.
FACTS: On Aug. 1, 1989, RA 6734 was passed (Organic Act of ARMM). Four provinces voted for
inclusion in ARMM, namely: Lanao del Sur, Maguindanao, Sulu and Tawi-Tawi. In accordance
with it, EO 426 was issued by Pres. Cory Aquino on Oct. 12, 1990. The same devolved to the
ARMM the power of the DPWH. Consequently, DO 119 entitled "Creation of Marawi Sub-District
Engineering Office." was issued by DPWH Sec. Vigilar last May 20, 1999, which is in accordance
with the E.O 124. It created a DPWH Marawi Sub-District Engineering Office which shall have
jurisdiction over all national infrastructure projects and facilities under the DPWH within Marawi
City and Lanao del Sur. On Jan. 17, 2001, RA 8999 which created a new Engineering District in
the first district of Lanao del Sur was passed by Pres. Estrada entitled “An act establishing an
engineering district as the first district of Lanao Del Sur and appropriating funds therefor”. On
March 31, 2001, RA 9054 which amended RA 6734 was passed. The province of Basilan and the
City of Marawi voted to join ARMM through said law.
Disomangcop and Dimalotang sin their capacity as Officer-in-Charge and Engineer II respectively
of the First Engineering District of DPWH-ARMM in Lanao del Sur filed a petition questioning the
constitutionality and validity of DO 119 and RA 8999 on the ground that they contravene the
constitution and the organic acts of the ARMM. Moreover they sought mainly the following relief:
to prohibit respondent DPWH Secretary from implementing D.O 119 and R.A 8999 and releasing
funds for public work projects intended for Lanao Del Sur and Marawi City to the Marawi Sub-
District Engineering Office and other administrative regions of DPWH.
ISSUE: WON DO 119 and RA 8999 are both invalid and constitutionally infirm
HELD: Yes, Republic Act 8999 never became an operative and was superseded or repealed by
Republic Act 9054. RA 8999 is patently inconsistent with RA 9054 which is a later law. RA 9054,
which is anchored on the 1987 Constitution advances the constitutional grant of autonomy by
detailing the powers of the ARMM which covers among others Lanao del Sur. However, RA 8999
ventures to re-establish the National Government's jurisdiction over the infrastructure programs
in Lanao del Sur. RA 8999 is patently inconsistent with RA 9054, and it destroys the latter law's
objective of devolution of the functions of DPWH in line with the policy of the Constitution to grant
LGUs meaningful and authentic regional autonomy.
DO 119 creating the Marawi Sub-District Engineering Office which has jurisdiction over
infrastructure projects within Marawi City and Lanao del Sur is violate of the provisions of EO 426
which implements the transfer of control and supervision of the DPWH to the ARMM in line with
RA 6734. The office created under DO 119 having essentially the same powers with the District
Engineering Office of Lanao del Sur as created under EO 426, is a duplication. The DO in effect
takes back powers which have been previously devolved under EO 426. RA 9054 however has
repealed DO Department Order 119.
Thus, R.A 8999 is antagonistic to and cannot be reconciled with both ARMM Organic Acts. It
contravened true decentralization which is the essence of regional autonomy. And, D.O were
issued unconstitutional and were issued grave abuse of discretion.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 8

G.R. No. 152774. May 27, 2004.*
THE PROVINCE OF BATANGAS, represented by its Governor, HERMILANDO I. MANDANAS,
petitioner, vs. HON. ALBERTO G. ROMULO, Executive Secretary and Chairman of the
Oversight Committee on Devolution; HON. EMILIA BONCODIN, Secretary, Department of
Budget and Management; HON. JOSE D. LINA, JR., Secretary, Department of Interior and
Local Government, respondents.
FACTS: In 1998, then President Estrada issued EO No. 48 establishing the “Program for
Devolution Adjustment and Equalization” to enhance the capabilities of LGUs in the discharge of
the functions and services devolved to them through the LGC.
The Oversight Committee under Executive Secretary Ronaldo Zamora passed Resolutions No.
OCD-99-005, OCD-99-006 and OCD-99-003 which were approved by Pres. Estrada on October 6,
1999. The guidelines formulated by the Oversight Committee required the LGUs to identify the
projects eligible for funding under the portion of LGSEF and submit the project proposals and
other requirements to the DILG for appraisal before the Committee serves notice to the DBM for
the subsequent release of the corresponding funds.
Hon. Herminaldo Mandanas, Governor of Batangas, petitioned to declare unconstitutional and
void certain provisos contained in the General Appropriations Acts (GAAs) of 1999, 2000, and
2001, insofar as they uniformly earmarked for each corresponding year the amount of P5billion
for the Internal Revenue Allotment (IRA) for the Local Government Service Equalization Fund
(LGSEF) & imposed conditions for the release thereof.
ISSUE: Whether the assailed provisos in the GAAs of 1999, 2000, and 2001, and the OCD
resolutions infringe the Constitution and the LGC of 1991.
HELD: Yes. The assailed provisos in the GAAs of 1999, 2000, and 2001, and the OCD resolutions
constitute a “withholding” of a portion of the IRA – they effectively encroach on the fiscal autonomy
enjoyed by LGUs and must be struck down.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 9

G.R. No. 132988. July 19, 2000.*
AQUILINO Q. PIMENTEL, JR., petitioner, vs. 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.
Facts: In 1997, President Ramos issued AO 372 which: (1) required all government departments and agencies,
including SUCs, GOCCs and LGUs to 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
(Section 1) and (2) ordered the withholding of 10% of the IRA to LGUs (Section 4) . On 10 December 1998,
President Estrada issued AO 43, reducing to 5% the amount of IRA to be withheld from LGU.
Issues:
1. 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
2. Whether 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
Held:
1. Section 1 of AO 372 does not violate local fiscal autonomy. Local fiscal autonomy does not 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, primarily responsible for formulating and implementing
continuing, coordinated and integrated social and economic policies, plans and programs 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.
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.
AO 372, however, 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.
2. Section 4 of AO 372 cannot 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. The Local
Government Code 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." As a rule, the term "shall" is a word of command that must be given
a compulsory meaning. The provision is, therefore, imperative. (Pimentel vs. Aguirre, G.R. No. 132988, July 19,
2000)

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 10

G.R. No. 93252. August 5, 1991.*
RODOLFO T. GANZON, petitioner, vs. THE HONORABLE COURT OF APPEALS, and LUIS T.
SANTOS, respondents.
FACTS: A series of administrative complaints, ten in number, were filed before the Department of
Local Government against petitioner Mayor Rodolfo T. Ganzon by various city officials sometime
in 1988 on various charges, among them, abuse of authority, oppression, grave misconduct, etc.
Finding probable grounds, the respondent Secretary of the Department of Local Government Luis
T. Santos issued successive suspensions. The petitioner then instituted an action for prohibition
against the secretary in the RTC of Iloilo City where he succeeded in obtaining a writ of preliminary
injunction. He also instituted actions for prohibition before the Court of Appeals but were both
dismissed. Thus, this petition for review with the argument that the respondent Secretary is
devoid, in any event, of any authority to suspend and remove local officials as the 1987
Constitution no longer allows the President to exercise said power.
ISSUE: Whether or not the President, acting thru the Secretary of Local Government, has the
power to suspend, remove, or both, local officials.
HELD: Yes. It is the considered opinion of the Court that notwithstanding the change in the
Constitutional language, the charter did not intend to divest the legislature of its right-or the
President of her prerogative as conferred by existing legislation to provide administrative sanction
against local officials. The Constitution did not…intend
G.R. No. 92299. April 19, 1991.*
REYNALDO R. SAN JUAN, petitioner, vs. CIVIL SERVICE COMMISSION, DEPARTMENT OF
BUDGET AND MANAGEMENT and CECILIA ALMAJOSE, respondents.
Facts: The Provincial Budget Officer of Rizal (PBO) was left vacant; thereafter Rizal Governor San
Juan, peititioner, nominated Dalisay Santos for the position and the latter quickly assumed
position. However, Director Abella of Region IV Department of Budget and Management (DBM) did
not endorse the nominee, and recommended private respondent Cecilia Almajose as PBO on the
ground that she was the most qualified. This appointment was subsequently approved by the
DBM. Petitioner protested the appointment of Almajose before the DBM and the Civil Service
Commission who both dismissed his complaints. His arguments rest on his contention that he
has the sole right and privilege to recommend the nominees to the position of PBO and that the
appointee should come only from his nominees. In support thereof, he invokes Section 1 of
Executive Order No. 112.
Issue: Whether or not DBM is empowered to appoint a PBO who was not expressly nominated by
the provincial governor.
Held: Under the cited Sec 1 of EO 112, the petitioner's power to recommend is subject to the
qualifications prescribed by existing laws for the position of PBO. Consequently, in the event that
the recommendations made by the petitioner fall short of the required standards, the appointing
authority, public respondent DBM is expected to reject the same. In the event that the Governor
recommends an unqualified person, is the Department Head free to appoint anyone he fancies?
The DBM may appoint only from the list of qualified recommendees nominated by the Governor.
If none is qualified, he must return the list of nominees to the Governor explaining why no one
meets the legal requirements and ask for new recommendees who have the necessary eligibilities
and qualifications.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 11

G.R. No. 199752. February 17, 2015.*
LUCENA D. DEMAALA, petitioner, vs. COMMISSION ON AUDIT, represented by its
Chairperson MA. GRACIA M. PULIDO-TAN, respondent.
FACTS: The Sangguniang Panlalawigan of Palawan enacted Provincial Ordinance No. 332-A,
Series of 1995, entitled “An Ordinance Approving and Adopting the Code Governing the Revision
of Assess-ments, Classification and Valuation of Real Properties in the Province of Palawan” (Ordi-
nance).Chapter 5, Section 48 of the Ordinance provides for an additional levy on real property tax
for the special education fund at the rate of one-half percent or 0.5%.
In conformity with Section 48 of the Ordinance, the Municipality of Narra, Palawan, with Demaala
as mayor, collected from owners of real properties located within its territory an annual tax as
special education fund at the rate of 0.5% of the assessed value of the property subject to tax. This
collection was effected through the municipal treasurer.
On post-audit, Audit Team Leader Juanito A. Nostratis issued Audit Observation Memorandum
(AOM) No. 03-005 dated August 7, 2003 in which he noted supposed deficiencies in the special
education fund collected by the Municipality of Narra. He questioned the levy of the special edu-
cation fund at the rate of only 0.5% rather than at 1%, the rate stated in Section 235 of Republic
Act No. 7160, otherwise known as the Local Government Code of 1991 (Local Government Code).
After evaluating AOM No. 03-005, Regional Cluster Director Sy issued NC No. 2004-04-101 dated
August 30, 2004 in the amount of P1,125,416.56. He held Demaala, the municipal treasurer of
Nar-ra, and all special education fund payors liable for the deficiency in special education fund
collec-tions.
The Municipality of Narra, through Demaala, filed the Motion for Reconsideration dated December
2, 2004. It stressed that the collection of the special education fund at the rate of 0.5% was mere-
ly in accordance with the Ordinance. On March 9, 2005, Regional Cluster Director Sy issued an
In-dorsement denying this Motion for Reconsideration.
Following this, the Municipality of Narra, through Demaala, filed an appeal with the Commission
on Audit’s Legal and Adjudication Office. In Local Decision No. 2006-05618 dated April 19, 2006,
this appeal was denied.
The Municipality of Narra, through Demaala, then filed a Petition for Review with the Commission
on Audit.
In Decision No. 2008-087 dated September 22, 2008, the Commission on Audit ruled against
Demaala and affirmed LAO Local Decision No. 2006-056 with the modification that former Palawan
Vice Governor Joel T. Reyes and the other members of the Sangguniang Panlalawigan of Palawan
who enacted the Ordinance were held jointly and severally liable with Demaala, the municipal
treasurer of Narra, and the special education fund payors.
Thereafter, Demaala, who was no longer the mayor of the Municipality of Narra, filed a Motion for
Reconsideration. Former Vice Governor Joel T. Reyes and the other members of the Sangguniang
Panlalawigan of Palawan who were held liable under Decision No. 2008-087 filed a separate Mo-
tion for Reconsideration. The Commission on Audit’s Decision No. 2011-083 dated November 16,
2011 affirmed its September 22, 2008 Decision.
Demaala then filed with this court the present Petition for Certiorari.
Respondent Commission on Audit, through the Office of the Solicitor General, filed its Com-ment
on April 20, 2012. Petitioner Demaala filed her Reply on September 6, 2012. Thereafter, the parties
filed their respective Memoranda.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 12

ISSUE: Whether respondent committed grave abuse of discretion amounting to lack or excess of
ju-risdiction in holding that there was a deficiency in the Municipality of Narra’s collection of the
ad-ditional levy for the special education fund. Subsumed in this issue is the matter of whether a
mu-nicipality within the Metropolitan Manila Area, a city, or a province may have an additional
levy on real property for the special education fund at the rate of less than 1%
RULING: YES. Consistent with the 1987 Constitution’s declared preference, the taxing powers of
local govern-ment units must be resolved in favor of their local fiscal autonomy. In City
Government of San Pablo v. Reyes:
The power to tax is primarily vested in Congress. However, in our jurisdiction, it may be exercised
by local legislative bodies, no longer merely by virtue of a valid delegation as before, but pursu-ant
to direct authority conferred by Section 5, Article X of the Constitution.
The limits on the level of additional levy for the special education fund under Section 235 of the
Local Government Code should be read as granting fiscal flexibility to local government units.
Book II of the Local Government Code governs local taxation and fiscal matters. Title II of Book II
governs real property taxation.
Section 235 of the Local Government Code allows provinces and cities, as well as municipalities
in Metro Manila, to collect, on top of the basic annual real property tax, an additional levy which
shall exclusively accrue to the special education fund.
The operative phrase in Section 235’s grant to municipalities in Metro Manila, cities, and provinces
of the power to impose an additional levy for the special education fund is prefixed with “may,”
thus, “may levy and collect an annual tax of one percent (1%).”
In Buklod nang Magbubukid sa Lupaing Ramos, Inc. v. E.M. Ramos and Sons, Inc. the meaning
of “may” was discussed as follows:
Where the provision reads “may,” this word shows that it is not mandatory but discretionary. It is
an auxiliary verb indicating liberty, opportunity, permission and possibility. The use of the word
“may” in a statute denotes that it is directory in nature and generally permissive only.
Respondent concedes that Section 235’s grant to municipalities in Metro Manila, to cities, and to
provinces of the power to impose an additional levy for the special education fund makes its col-
lection optional. It is not mandatory that the levy be imposed and collected. The controversy which
the Commission on Audit created is not whether these local government units have discre-tion to
collect but whether they have discretion on the rate at which they are to collect.
It is respondent’s position that the option granted to a local government unit is limited to the
matter of whether it shall actually collect, and that the rate at which it shall collect (should it
choose to do so) is fixed by Section 235. In contrast, it is petitioner’s contention that the option
given to a local government unit extends not only to the matter of whether to collect but also to
the rate at which collection is to be made.
We sustain the position of petitioner. Section 235’s permissive language is unqualified. Moreover,
there is no limiting qualifier to the articulated rate of 1% which unequivocally indicates that any
and all special education fund collections must be at such rate.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 13

CITY OF GENERAL SANTOS, represented by its Mayor, HON. DARLENE MAGNOLIA R.
ANTONINO-CUSTODIO, petitioner, vs. COMMISSION ON AUDIT, respondent.
Facts: Former Mayor Acharon of General Santos City issued Executive Order No. 40, series of
2008, creating management teams pursuant to its organization development program. In addition
to, Executive Order No. 13, series of 2009 was also adopted embodying the organization
development masterplan. This was followed by Resolution No. 004, series of 2009, requesting for
the mayor’s support for GenSan SERVES, an early retirement program to be proposed to the
Sangguniang Panlungsod.
Consequently, Ordinance No. 08, series of 2009, was passed together with its implementing rules
and regulations. The said ordinance “provides for separation benefits for sickly employees who
have not yet reached retirement age.”
Respondent Commission on Audit (COA) argued that Ordinance No. 08, series of 2009, partakes
of the nature of a supplementary retirement benefit plan proscribed by Section 28, paragraph (b)
of Commonwealth Act No. 186 as amended. COA also observed that GenSan SERVES was not
based on a law passed by Congress but on ordinances and resolutions passed and approved by
the Sangguniang Panlungsod and Executive Orders by the city mayor. Moreover, nowhere in
Section 76 of the Local Government Code, does it provide a specific power for local government
units to establish an early retirement program.
Issue: Does the constitutional mandate for local autonomy grant local governments the power to
streamline and reorganize as well as the authority to create a separate or supplementary
retirement benefit plan?
Ruling: Local autonomy also grants local governments the power to streamline and reorganize.
This power is inferred from Section 76 of the Local Government Code on organizational structure
and staffing pattern, and Section 16 otherwise known as the general welfare clause. In this case,
the constitutional mandate for local autonomy supports petitioner city’s issuance of Executive
Order No. 40, series of 2008, creating change management teams as an initial step for its
organization development masterplan.
As for the supplementary retirement benefit plan, however, it is proscribed by Section 28,
paragraph (b) of Commonwealth Act No. 186, otherwise known as the Government Service
Insurance Act, as amended by Republic Act No. 4968. This provision bans all supplementary
retirement or pension plans for government employees in order to prevent the undue and
inequitous proliferation of such plans.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 14

G.R. No. 182574. September 28, 2010.*
THE PROVINCE OF NEGROS OCCIDENTAL, represented by its Governor ISIDRO P. ZAYCO,
petitioner, vs. THE COMMISSIONERS, COMMISSION ON AUDIT; THE DIRECTOR, CLUSTER
IV-VISAYAS; THE REGIONAL CLUSTER DIRECTORS; and THE
Issue: WON the insurance benefits granted to the employees require prior approval from the
President as required under Administrative Order No. 103
Petitioner:
• The payment of the insurance premium for the health benefits of its officers and employees was
not unlawful and improper since it was paid from an allocation of its retained earnings pursuant
to a valid appropriation ordinance.
O Such enactment was a clear exercise of its express powers under the principle of local fiscal
autonomy which includes the power of LGUs to allocate their resources in accordance with their
own priorities.
O Also, an LGU has fiscal control over its own revenues derived solely from its own tax base.
Respondent:
• Although LGUs are afforded local fiscal autonomy, LGUs are still bound by RA 6758 and their
actions are subject to the scrutiny of the DBM and applicable auditing rules and regulations
enforced by the COA.
• The grant of additional compensation, like the hospitalization and health care insurance benefits
in the present case, must have prior Presidential approval to conform with the state policy on
salary standardization for government workers.
Held: NO
• AO 103 took effect eleven months before the Sangguniang Panlalawigan passed Resolution No.
720-A. The main purpose of AO 103 is to prevent discontentment, dissatisfaction and
demoralization among government personnel, national or local, who do not receive, or who receive
less, productivity incentive benefits or other forms of allowances or benefits.
• It is clear from Sec. 1 of AO 103 that the President authorized all agencies of the national
government as well as LGUs to grant the maximum amount of P2,000 productivity incentive
benefit to each employee. In Sec. 2, the President enjoined all heads of government offices and
agencies from granting productivity incentive benefits or any and all similar forms of allowances
and benefits without the President’s prior approval.
• From a close reading of the provisions of AO 103, petitioner did not violate the rule of prior
approval from the President since Sec. 2 states that the prohibition applies only to “government
offices/agencies, including GOCCs, as well as their respective governing boards.” Nowhere is it
indicated that the prohibition also applies to LGUs. The requirement then of prior approval from
the President under AO 103 is applicable only to departments, bureaus, offices and GOCCs.
O Since LGUs are subject only to the power of general supervision of the President, the President’s
authority is limited to seeing to it that rules are followed and laws are faithfully executed. Thus,
the grant of additional compensation like hospitalization and health care insurance benefits in the
present case does not need the approval of the President to be valid.
• Also, while it is true that LGUs are still bound by RA 6758, the COA did not clearly establish
that the medical care benefits given by the government at the time under PD 1519 were sufficient
to cover the needs of government employees especially those employed by LGUs.
PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 15
• Petitioner correctly relied on the CSC Memorandum Circular No. 33 which provided the policy
framework for working conditions at the workplace. All government offices including LGUs were
directed to provide a health program for government employees which included hospitalization
services and annual mental, medical-physical examinations.
O The CSC, through MC No. 33, as well as the President, through AO 402, recognized the
deficiency of the state of health care and medical services implemented at the time. RA 7875
(National Health Insurance Act) instituting a National Health Insurance Program (NHIP) for all
Filipinos was only approved two months after the Sangguniang Panlalawigan passed Resolution
No. 720-A. Even with the establishment of the NHIP, AO 402 was still issued three years later
addressing a primary concern that basic health services under the NHIP either are still inadequate
or have not reached geographic areas like that of petitioner.
• Thus, consistent with the state policy of local autonomy as guaranteed by the 1987 Constitution,
under Sec. 25, Article II and Section 2, Article X, and the LGC, the Court declares that the grant
and release of the hospitalization and health care insurance benefits were validly enacted through
an ordinance passed by the Sangguniang Panlalawigan.
G.R. No. 195390. December 10, 2014.*
GOV. LUIS RAYMUND F. VILLAFUERTE, JR., and the PROVINCE OF CAMARINES SUR,
petitioners, vs. HON. JESSE M. ROBREDO, in his capacity as Secretary of the Department
of the Interior and Local Government, respondent.
SUMMARY: Villafuerte filed a petition assailing the three memorandum circulars issued by
Robredo. The circulars pertain to full disclosure of local budget and finances and other guidelines
regarding budget. Villafuerte argues that the circulars violate the principles of local and fiscal
autonomy of the LGU. The Court ruled that the circulars merely reiterated what was already
provided in the law and that the order on public disclosure is consistent with the policy of
promoting good governance through transparency, accountability and participation.
ISSUE: Whether or not the assailed memorandum circulars violate the principles of local and fiscal
autonomy enshired in the Constitution and the LGC? – NO
• Petitioners: assailed issuances interfere with the local and fiscal autonomy of LGUs embodied in
the Constitution and the LGC.
O MC 2010-138 transgressed these constitutionally-protected liberties when it restricted the
meaning of “development” and enumerated activities which the local government must finance
from the 20% development fund component of the IRA and provided sanctions for local authorities
who shall use the said component of the fund for the excluded purposes stated therein.
O Robredo cannot substitute his own discretion with that of the local legislative council in enacting
its annual budget and specifying the development projects that the 20% component of its IRA
should fund.
• Court: Petitioners’ arguments are untenable.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 16

G.R. No. 175368. April 11, 2013.*
LEAGUE OF PROVINCES OF THE PHILIPPINES, petitioner, vs. DEPARTMENT OF
ENVIRONMENT and NATURAL RESOURCES and HON. ANGELO T. REYES, in his capacity as
Secretary of DENR, respondents.
FACTS : Golden Falcon applied for FTAA before the MGB-RO. On April 29, 1998, MGB-RO denied
Golden Falcon’s application for FTAA on for failure to secure the required area clearances from the
Forest Management Sector and Lands Management Sector of the DENR-RO. Golden Falcon
appealed the denial with the Mines and Geosciences Bureau-Central Office (MGB-CO).
On February 10, 2004, pending Golden Falcon's appeal to the MGB-CO, MCCS filed with the
PENRO of Bulacan their applications for quarry permit covering the same area subject of Golden
Falcon's FTAA application. MGB-CO finally denied Golden Falcon’s appeal on July 16, 2004.
AMTC filed with the PENRO of Bulacan an application for exploration permit covering the same
subject area on September 13, 2004. Confusion of rights resulted from the overlapping
applications of AMTC and the persons applying for quarry permits – the contention was the date
the area of Golden Falcon’s application became open to other permit applications from other
parties
On October 19, 2004, upon query by MGB-RO Director Cabantog, DENR-MGB Director Ramos
stated that the denial of Golden Falcon’s application became final on August 11, 2004, or fifteen
days after Golden Falcon received the order of denial of its application. Hence, the area of Golden
Falcon’s application became open to permit applications only on that date.
Subsequently, the Provincial Legal Officer of Bulacan issued a legal opinion on the issue, stating
that the subject area became open for new applications on the date of the first denial on April 29,
1998 (MGB-RO’s order of denial), as MGB-CO’s order of denial on July 16, 2004 was a mere
reaffirmation of the MGB-RO’s April 29 order; hence, the reckoning period should be April 29.
Based on this legal opinion, MGB-RO Director Cabantog endorsed the applications for quarry
permit, now apparently converted to applications for small-scale mining permit, to the Governor
of Bulacan. PENRO of Bulacan recommended to the Governor the approval of said applications.
Eventually, the Governor issued the small-scale mining permits. AMTC appealed to the DENR
Secretary.
The DENR Secretary decided in favor of the AMTC and nullified and cancelled the governor’s
issuance of small-scale mining permits. It agreed with DENR-MGB Director Ramos that the area
was open to mining location only on August 11, 2004 (15 days after the MGB-CO denial). Hence,
the applications for quarry permit filed on February 10, 2004 were null as these were filed when
the area was still closed to mining location. On the other hand, AMTC filed its application when
the area was already open to other mining applicants, hence, its application was valid. The small-
scale mining permits were also issued in violation of Section 4 of R.A. No. 7076 and beyond the
authority of the Governor pursuant to Sec. 43 of RA 7942 because the area was never proclaimed
to be under the small-scale mining program.
The petitioner League of the Provinces of the Philippines filed this petition saying that that this is
not an action of one province alone, but the collective action of all provinces through the League,
as a favorable ruling will not only benefit one province, but all provinces and all local governments.
ISSUES
1. Whether DENR’s act of nullifying the small-scale mining permits amounts to executive control,
not merely supervision and usurps the devolved powers of all provinces, as the DENR Secretary
substituted the judgment of the Provincial Governor of Bulacan.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 17

2. Whether or not Section 17, b(3)(III) of the Local Government Code and Section 24 of the Small-
Scale Mining Act, which confer upon DENR and the DENR Secretary the power of control are
unconstitutional, as the Constitution states that the President (and Exec Depts) has the power of
supervision only, not control over acts of LGUs
RULING: [The Court finds that petitioner has legal standing to file this petition because it is tasked
under Section 504 of the Local Government Code of 1991 to promote local autonomy at the
provincial level; adopt measures for the promotion of the welfare of all provinces and its officials
and employees; and exercise such other powers and perform such other duties and functions as
the league may prescribe for the welfare of the provinces.]
DENR Sec’s act was valid and authorized pursuant to its power of review under the RA 7076 and
its IRR; Assailed statutes did not overcome the presumption of constitutionality, hence, are not
unconstitutional.
Control of the DENR/DENR Secretary over small-scale mining in the provinces is granted by three
statutes: (1) R.A. 7061 or The Local Government Code of 1991; (2) R.A. 7076 or the People's Small
Scale Mining Act of 1991; and (3) R.A. No. 7942 or the Philippine Mining Act of 1995.
Control is the power of an officer to alter or modify or set aside what a subordinate officer had
done in the performance of his/her duties and to substitute the judgment of the former for the
latter. Supervision is the power of a superior officer to see to it that lower officers perform their
function in accordance with law.
The Constitutional guarantee of local autonomy in the Article X, Sec. 2 of the Constitution refers
to the administrative autonomy of the LGUs or the decentralization of government authority. It
does not make local governments within the State. Administrative autonomy may involve
devolution of powers, but it is still subject to limitations, like following national policies or
standards and those provided by the Local Government Code, as the structuring of LGUs and the
allocation of powers/responsibilities/resources among the LGUs and local officials are placed by
the Constitution to Congress under Article X Section 3
It is the DENR which is in-charge of carrying out the State’s constitutional mandate to control and
supervise the exploration, development and utilization of the country’s natural resources,
pursuant to the provisions of Section 17, b(3)(III) of the LGC. Hence, the enforcement of the small-
scale mining law by the provincial government is subject to the supervision, control and review of
the DENR. The LGC did not fully devolve to the provincial government the enforcement of the
small-scale mining law.
RA 7076 or the People’s Small-Scale Mining program was established to be implemented by the
DENR Secretary in coordination with other government agencies (Section 4, RA 7076). Section 24
of the law makes the Provincial/ Mining Regulatory Board under the direct supervision and control
of the Secretary, its powers and functions subject to review by the same.
Under Section 123 of DENR AO No. 23, small-scale mining applications should be filed with the
PMRB and the permits shall be issued by the provincial governor, for applications outside the
mineral reservations.
DENR Administrative Order No. 34 (1992) which contains the IRR of RA 7076 likewise provides
that the DENR Secretary shall exercise direct supervision and control over the People’s Small-
Scale Mining Program, and that the Provincial/City Mining Regulatory Board’s (PMRB) powers and
functions shall be subject to review by the DENR Secretary. DENR Administrative Order No. 96-
40 or the Revised IRR of the Philippine Mining Act of 1995 provides that applications for Small-
Scale Mining Permits shall be filed with the Provincial Governor/City Mayor through their
respective Mining Regulatory Boards for areas outside the Mineral Reservations, and further, that

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 18

the LGUs in coordination with the Bureau/Regional Offices shall approve applications for small-
scale mining, sand and gravel, quarry xxx and gravel permits not exceeding 5 hectares.
Petitioner’s contention that the aforementioned laws and rules did not confer upon DENR and
DENR Secretary the power to reverse, abrogate, nullify, void, cancel the permits issued by the
Provincial Governor or small-scale mining contracts entered into by the Board are without merit
because the DENR Secretary was granted the power of review in the PMRB’s resolution of disputes
under Sec. 24 of RA 7076 and Section 22 of its IRR. The decision of the DENR Secretary to nullify
and cancel the Governor’s issuance of permits emanated from its power of review under RA 7076
ad its IRR. Its power to review and decide on the validity of the issuance of the Small-Scale Mining
Permits by the Provincial Governor is a quasi-judicial function which involves the determination
of what the law is and what the legal rights of the contending parties are, with respect to the matter
in controversy and on the basis thereof and the facts obtaining, the adjudication of their respective
rights.
The DENR Secretary exercises quasi-judicial function under RA 7076 and its IRR to the extent
necessary in settling disputes, conflicts, or litigations over conflicting claims. This quasi-judicial
power of the DENR can neither be equated with “substitution of judgment” of the Provincial
Governor in issuing Small-Scale Mining Permits nor “control” over the said act of the Provincial
Governor as it is a determination of the rights of the AMTC over conflicting claims based on the
law.
In Beltran v. Secretary of Health, the Court held that every law has in its favor the presumption of
constitutionality. For a law to be nullified, it must be shown that there is a clear and unequivocal
breach of the Constitution. The ground for nullity must be clear and beyond reasonable doubt. In
this case, the grounds raised by the petitioner to challenge the constitutionality of Sec. 17 b(3)(iii)
of the LGC and Section 24 of RA 7076 has failed to overcome the constitutionality of the said
provisions of the law.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 19

G.R. No. 180050. May 12, 2010.*
RODOLFO G. NAVARRO, VICTOR F. BERNAL, and RENE O. MEDINA, petitioners, vs.
EXECUTIVE SECRETARY EDUARDO ERMITA, representing the President of the Philippines;
SENATE OF THE PHILIPPINES, represented by the SENATE PRESIDENT; HOUSE OF
REPRESENTATIVES, represented by the HOUSE SPEAKER; GOVERNOR ROBERT ACE S.
BARBERS, representing the Mother Province of Surigao del Norte; GOVERNOR GERALDINE
ECLEO VILLAROMAN, representing the new Province of Dinagat Islands, respondents.
FACTS: October 2, 2006, the President of the Republic approved into law Republic Act (R.A.) No.
9355 (An Act Creating the Province of Dinagat Islands).
December 3, 2006, the Commission on Elections (COMELEC) conducted the mandatory plebiscite
for the ratification of the creation of the province under the Local Government Code (LGC). The
plebiscite yielded 69,943 affirmative votes and 63,502 negative votes. With the approval of the
people from both the mother province of Surigao del Norte and the Province of Dinagat Islands
(Dinagat).
November 10, 2006, petitioners filed before this Court a petition for certiorari and prohibition
challenging the constitutionality of R.A. No. 9355. The Court dismissed the petition on technical
grounds. Their motion for reconsideration was also denied.
Undaunted, petitioners filed another petition for certiorari seeking to nullify R.A. No. 9355 for
being unconstitutional. They alleged that the creation of Dinagat as a new province, if uncorrected,
would perpetuate an illegal act of Congress, and would unjustly deprive the people of Surigao del
Norte of a large chunk of the provincial territory, Internal Revenue Allocation (IRA), and rich
resources from the area. They pointed out that when the law was passed, Dinagat had a land area
of 802.12 square kilometers only and a population of only 106,951, failing to comply with Section
10, Article X of the Constitution and of Section 461 of the LGC.
May 12, 2010, movants-intervenors raised three (3) main arguments to challenge the above
Resolution, namely: (1) that the passage of R.A. No. 9355 operates as an act of Congress amending
Section 461 of the LGC; (2) that the exemption from territorial contiguity, when the intended
province consists of two or more islands, includes the exemption from the application of the
minimum land area requirement; and (3) that the Operative Fact Doctrine is applicable in the
instant case.
July 20, 2010, the Court denied the Motion for Leave to Intervene and to File and to Admit
Intervenors’ Motion for Reconsideration of the Resolution dated May 12, 2010 on the ground that
the allowance or disallowance of a motion to intervene is addressed to the sound discretion of the
Court, and that the appropriate time to file the said motion was before and not after the resolution
of this case.
September 7, 2010, movants-intervenors filed a Motion for Reconsideration of the July 20, 2010
Resolution, citing several rulings of the Court, allowing intervention as an exception to Section 2,
Rule 19 of the Rules of Court that it should be filed at any time before the rendition of judgment.
They alleged that, prior to the May 10, 2010 elections, their legal interest in this case was not yet
existent. They averred that prior to the May 10, 2010 elections, they were unaware of the
proceedings in this case.
October 5, 2010, the Court issued an order for Entry of Judgment, stating that the decision in this
case had become final and executory on May 18, 2010.
ISSUE: Whether or not the provision in Article 9(2) of the Rules and Regulations Implementing the
Local Government Code of 1991 valid.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 20

HELD: Yes, the Congress, recognizing the capacity and viability of Dinagat to become a full-fledged
province, enacted R.A. No. 9355, following the exemption from the land area requirement, which,
with respect to the creation of provinces, can only be found as an express provision in the LGC-
IRR. In effect, pursuant to its plenary legislative powers, Congress breathed flesh and blood into
that exemption in Article 9(2) of the LGC-IRR and transformed it into law when it enacted R.A. No.
9355 creating the Island Province of Dinagat.
The land area, while considered as an indicator of viability of a local government unit, is not
conclusive in showing that Dinagat cannot become a province, taking into account its average
annual income of P82,696,433.23 at the time of its creation, as certified by the Bureau of Local
Government Finance, which is four times more than the minimum requirement of P20,000,000.00
for the creation of a province. The delivery of basic services to its constituents has been proven
possible and sustainable. Rather than looking at the results of the plebiscite and the May 10, 2010
elections as mere fait accompli circumstances which cannot operate in favor of Dinagat’s existence
as a province, they must be seen from the perspective that Dinagat is ready and capable of
becoming a province. This Court should not be instrumental in stunting such capacity.
Ratio legis est anima. The spirit rather than the letter of the law. A statute must be read according
to its spirit or intent, for what is within the spirit is within the statute although it is not within its
letter, and that which is within the letter but not within the spirit is not within the statute. Put a
bit differently, that which is within the intent of the lawmaker is as much within the statute as if
within the letter, and that which is within the letter of the statute is not within the statute unless
within the intent of the lawmakers. Withal, courts ought not to interpret and should not accept an
interpretation that would defeat the intent of the law and its legislators.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 21

G.R. No. 133064. September 16, 1999.*
JOSE C. MIRANDA, ALFREDO S. DIRIGE, MANUEL H. AFIADO, MARIANO V. BABARAN and
ANDRES R. CABUYADAO, petitioners, vs. HON. ALEXANDER AGUIRRE, In his capacity as
Executive Secretary
FACTS: On 1994, RA No. 7720 effected the conversion of the municipality of Santiago, Isabela,
into an independent component city. July 4th, RA No. 7720 was approved by the people of Santiago
in a plebiscite. 1998, RA No. 8528 was enacted and it amended RA No. 7720 that practically
downgraded the City of Santiago from an independent component city to a component city.
Petitioners assail the constitutionality of RA No. 8528 for the lack of provision to submit the law
for the approval of the people of Santiago in a proper plebiscite.
Respondents defended the constitutionality of RA No. 8528 saying that the said act merely
reclassified the City of Santiago from an independent component city into a component city. It
allegedly did not involve any “creation, division, merger, abolition, or substantial alteration of
boundaries of local government units,” therefore, a plebiscite of the people of Santiago is
unnecessary. They also questioned the standing of petitioners to file the petition and argued that
the petition raises a political question over which the Court lacks jurisdiction.
ISSUE: Whether or not the Court has jurisdiction over the petition at bar.
RULING: Yes. RA No. 8528 is declared unconstitutional. That Supreme Court has the jurisdiction
over said petition because it involves not a political question but a justiciable issue, and of which
only the court could decide whether or not a law passed by the Congress is unconstitutional.
That when an amendment of the law involves creation, merger, division, abolition or substantial
alteration of boundaries of local government units, a plebiscite in the political units directly
affected is mandatory.
Petitioners are directly affected in the implementation of RA No. 8528. Miranda was the mayor of
Santiago City, Afiado was the President of the Sangguniang Liga, together with 3 other petitioners
were all residents and voters in the City of Santiago. It is their right to be heard in the conversion
of their city through a plebiscite to be conducted by the COMELEC. Thus, denial of their right in
RA No. 8528 gives them proper standing to strike down the law as unconstitutional.
Sec. 1 of Art. VIII of the Constitution states that: the judicial power shall be vested in one Supreme
Court and in such lower courts as may be established by law. 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 instru-mentality of the
Government.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 22

G.R. No. 103328. October 19, 1992.*
HON. ROY A. PADILLA, JR., In his capacity as Governor of the Province of Camarines Norte,
petitioner, vs. COMMISSION ON ELECTIONS, respondent.
Facts: Republic Act No. 7155 created the new municipality of Tulay-Na-Lupa in the Province of
Camarines Norte and pursuant to this law, the COMELEC (D) conducted a plebiscite for its
approval. In its resolution for the conduct of the plebiscite, the COMELEC (D) included all the
voters of the Municipality of Labo—the parent unit of the new municipality.
The result of the plebiscite showed that the majority rejected the creation of the new Municipality
of Tulay-Na-Lupa. The governor, Hon. Roy Padilla, Jr. (P), petitioned the court to set aside the
result arguing that the phrase "political units directly affected" in Section 10, Article X of the 1987
Constitution does not include the parent political unit—the Municipality of Labo.
Issues: Is the result of the plebiscite valid?
Ruling: Yes. When the law states that the plebiscite shall be conducted "in the political units
directly affected," it means that residents of the political entity who would be economically
dislocated by the separation thereof have a right to vote in said plebiscite. What is contemplated
by the phrase "political units directly affected," is the plurality of political units which would
participate in the plebiscite. Logically, those to be included in such political areas are the
inhabitants of the proposed Municipality of Tulay-Na-Lupa as well as those living in the the parent
Municipality of Labo, Camarines Norte.
G.R. No. 118577. March 7, 1995.*
JUANITO MARIANO, JR., et al., petitioners, vs. THE COMMISSION ON ELECTIONS, THE
MUNICIPALITY OF MAKATI, HON. JEJOMAR BINAY, THE MUNICIPAL TREASURER, AND
SANGGUNIANG BAYAN OF MAKATI, respondents.
FACTS: This is a petition for prohibition and declaratory relief filed by petitioners Juanito Mariano,
Jr., Ligaya S. Bautista, Teresita Tibay, Camilo Santos, Frankie Cruz, Ricardo Pascual, Teresita
Abang, Valentina Pitalvero, Rufino Caldoza, Florante Alba, and Perfecto Alba. Of the petitioners,
only Mariano, Jr., is a resident of Makati. The others are residents of Ibayo Ususan, Taguig, Metro
Manila. Suing as taxpayers, they assail sections 2, 51, and 52 of Republic Act No. 7854 as
unconstitutional.
ISSUE: Whether or not there is an actual case or controversy to challenge the constitutionality of
one of the questioned sections of R.A. No. 7854.
HELD: The requirements before a litigant can challenge the constitutionality of a law are well
delineated. They are: 1) there must be an actual case or controversy; (2) the question of
constitutionality must be raised by the proper party; (3) the constitutional question must be raised
at the earliest possible opportunity; and (4) the decision on the constitutional question must be
necessary to the determination of the case itself.
Petitioners have far from complied with these requirements. The petition is premised on the
occurrence of many contingent events, i.e., that Mayor Binay will run again in this coming
mayoralty elections; that he would be re-elected in said elections; and that he would seek re-
election for the same position in the 1998 elections. Considering that these contingencies may or
may not happen, petitioners merely pose a hypothetical issue which has yet to ripen to an actual
case or controversy. Petitioners who are residents of Taguig (except Mariano) are not also the
proper parties to raise this abstract issue. Worse, they hoist this futuristic issue in a petition for
declaratory relief over which this Court has no jurisdiction.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 23

G.R. No. 146319. October 26, 2001.
BENJAMIN E. CAWALING, JR., petitioner, vs. THE COMMISSION ON ELECTIONS, and Rep.
FRANCIS JOSEPH G. ESCUDERO, respondents.
Facts: On August 16, 2000, former President Joseph E. Estrada signed into law R.A. No. 8806,
an "Act Creating The City Of Sorsogon By Merging The Municipalities Of Bacon And Sorsogon In
The Province Of Sorsogon, And Appropriating Funds Therefor." The COMELEC a plebiscite in the
Municipalities of Bacon and Sorsogon and submitted the matter for ratification proclaimed the
creation of the City of Sorsogon as having been ratified and approved by the majority of the votes
cast in the plebiscite.
Invoking his right as a resident and taxpayer, the petitioner filed the present petition for certiorari
seeking the annulment of the plebiscite on the following grounds:
A. The December 16, 2000 plebiscite was conducted beyond the required 120-day period from the
approval of R.A. 8806, in violation of Section 54 thereof; and
B. Respondent COMELEC failed to observe the legal requirement of twenty (20) day extensive
information campaign in the Municipalities of Bacon and Sorsogon before conducting the
plebiscite.
Petitioner instituted another petition declaring enjoin R.A. No. 8806 unconstitutional ,contending,
in essence, that:
1. The creation of Sorsogon City by merging two municipalities violates Section 450(a) of the Local
Government Code of 1991 (in relation to Section 10, Article X of the Constitution) which requires
that only "a municipality or a cluster of barangays may be converted into a component city"; and
2. R.A. No. 8806 contains two (2) subjects, namely, the (a) creation of the City of Sorsogon and the
(b) abolition of the Municipalities of Bacon and Sorsogon, thereby violating the "one subject-one
bill" rule prescribed by Section 26(1), Article VI of the Constitution.
Petitioner contends that under Section 450(a) of the Code, a component city may be created only
by converting "a municipality or a cluster of barangays," not by merging two municipalities, as
what R.A. No. 8806 has done.
Issue: (1) WON a component city may be created by merging two municipalities.
(2) WON there exist a "compelling" reason for merging the Municipalities of Bacon and Sorsogon
in order to create the City of Sorsogon
(3) WON R.A. No. 8806 violatethe "one subject-one bill" rule enunciated in Section 26 (1), Article
VI of the Constitution
(4) WON R.A No 8806 is unconstitutional
Held: Yes. Petitioner's constricted reading of Section 450(a) of the Code is erroneous. The phrase
"A municipality or a cluster of barangays may be converted into a component city" is not a criterion
but simply one of the modes by which a city may be created. Section 10, Article X of the
Constitution allows the merger of local government units to create a province city, municipality or
barangay in accordance with the criteria established by the Code. the creation of an entirely new
local government unit through a division or a merger of existing local government units is
recognized under the Constitution, provided that such merger or division shall comply with the
requirements prescribed by the Code.

PUBCORP MIDTERM CASE NOTES, 2ND SEM AY 2018-2019 - cjamiemelchor 24