1

BASIC SERVICES AND FACILITIES

G.R. No. 148357 June 30, 2006
ANIANO A. ALBON, Petitioner,
vs.
BAYANI F. FERNANDO, City Mayor of Marikina, ENGR. ALFONSO ESPIRITO, City Engineer
of Marikina, ENGR. ANAKI MADERAL, Assistant City Engineer of Marikina, and NATIVIDAD
CABALQUINTO, City Treasurer of Marikina, Respondents.
RESOLUTION
CORONA, J.:
May a local government unit (LGU) validly use public funds to undertake the widening, repair and
improvement of the sidewalks of a privately-owned subdivision?
This is the issue presented for the Court’s resolution in
this petition for review on certiorari1 which assails the December 22, 2000 decision2 and May 30,
2001 resolution of the Court of Appeals in CA-G.R. SP No. 56767.
In May 1999, the City of Marikina undertook a public works project to widen, clear and repair the
existing sidewalks of Marikina Greenheights Subdivision. It was undertaken by the city government
pursuant to Ordinance No. 59, s. 19933 like other infrastructure projects relating to roads, streets
and sidewalks previously undertaken by the city.
On June 14, 1999, petitioner Aniano A. Albon filed with the Regional Trial Court of Marikina, Branch
73, a taxpayer’s suit for certiorari, prohibition and injunction with damages against respondents (who
were at that time officials of Marikina), namely, City Mayor Bayani F. Fernando, City Engineer
Alfonso Espirito, Assistant City Engineer Anaki Maderal and City Treasurer Natividad Cabalquinto.
It was docketed as SCA Case No. 99-331-MK.
Petitioner claimed that it was unconstitutional and unlawful for respondents to use government
equipment and property, and to disburse public funds, of the City of Marikina for the grading,
widening, clearing, repair and maintenance of the existing sidewalks of Marikina Greenheights
Subdivision. He alleged that the sidewalks were private property because Marikina Greenheights
Subdivision was owned by V.V. Soliven, Inc. Hence, the city government could not use public
resources on them. In undertaking the project, therefore, respondents allegedly violated the
constitutional proscription against the use of public funds for private purposes 4 as well as Sections
335 and 336 of RA 71605 and the Anti-Graft and Corrupt Practices Act. Petitioner further alleged
that there was no appropriation for the project.
On June 22, 1999, the trial court denied petitioner’s application for a temporary restraining order
(TRO) and writ of preliminary injunction. The trial court reasoned that the questioned undertaking
was covered by PD 1818 and Supreme Court Circular No. 68-94 which prohibited courts from
issuing a TRO or injunction in any case, dispute or controversy involving an infrastructure project of
the government.
On November 15, 1999, the trial court rendered its decision6 dismissing the petition. It ruled that the
City of Marikina was authorized to carry out the contested undertaking pursuant to its inherent police
power. Invoking this Court’s 1991 decision in White Plains Association v. Legaspi,7 the roads and
sidewalks inside the Marikina Greenheights Subdivision were deemed public property.
Petitioner sought a reconsideration of the trial court’s decision but it was denied.
Thereafter, petitioner elevated the case to the Court of Appeals via a petition for certiorari,
prohibition, injunction and damages. On December 22, 2000, the appellate court sustained the ruling
of the trial court and held that Ordinance No. 59, s. 1993, was a valid enactment. The sidewalks of
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Marikina Greenheights Subdivision were public in nature and ownership thereof belonged to the City
of Marikina or the Republic of the Philippines following the 1991 White Plains Association decision.
Thus, the improvement and widening of the sidewalks pursuant to Ordinance No. 59, s. 1993 was
well within the LGU’s powers. On these grounds, the petition was dismissed.
Petitioner moved for reconsideration of the appellate court’s decision but it was denied. Undaunted,
he instituted this petition.
Like all LGUs, the City of Marikina is empowered to enact ordinances for the purposes set forth in
the Local Government Code (RA 7160). It is expressly vested with police powers delegated to LGUs
under the general welfare clause of RA 7160.8 With this power, LGUs may prescribe reasonable
regulations to protect the lives, health, and property of their constituents and maintain peace and
order within their respective territorial jurisdictions.9
Cities and municipalities also have the power to exercise such powers and discharge such functions
and responsibilities as may be necessary, appropriate or incidental to efficient and effective
provisions of the basic services and facilities, including infrastructure facilities intended primarily to
service the needs of their residents and which are financed by their own funds.10 These
infrastructure facilities include municipal or city roads and bridges and similar facilities. 11
There is no question about the public nature and use of the sidewalks in the Marikina Greenheights
Subdivision. One of the "whereas clauses" of PD 1216 12 (which amended PD 95713) declares that
open spaces,14 roads, alleys and sidewalks in a residential subdivision are for public use and beyond
the commerce of man. In conjunction herewith, PD 957, as amended by PD 1216, mandates
subdivision owners to set aside open spaces which shall be devoted exclusively for the use of the
general public.
Thus, the trial and appellate courts were correct in upholding the validity of Ordinance No. 59, s.
1993. It was enacted in the exercise of the City of Marikina’s police powers to regulate the use of
sidewalks. However, both the trial and appellate courts erred when they invoked our 1991 decision
in White Plains Association and automatically applied it in this case.
This Court has already resolved three interrelated White Plains Association cases:15 (1) G.R. No.
5568516 resolved in 1985; (2) G.R. No. 9552217 decided in 1991 and (3) G.R. No. 12813118 decided
in 1998.
The ruling in the 1991 White Plains Association decision relied on by both the trial and appellate
courts was modified by this Court in 1998 in White Plains Association v. Court of
Appeals.19 Citing Young v. City of Manila,20 this Court held in its 1998 decision that subdivision
streets belonged to the owner until donated to the government or until expropriated upon payment
of just compensation.
The word "street," in its correct and ordinary usage, includes not only the roadway used for carriages
and vehicular traffic generally but also the portion used for pedestrian travel.21 The part of the street
set aside for the use of pedestrians is known as a sidewalk.22
Moreover, under subdivision laws,23 lots allotted by subdivision developers as road lots include
roads, sidewalks, alleys and planting strips.24 Thus, what is true for subdivision roads or streets
applies to subdivision sidewalks as well. Ownership of the sidewalks in a private subdivision belongs
to the subdivision owner/developer until it is either transferred to the government by way of donation
or acquired by the government through expropriation.
Section 335 of RA 7160 is clear and specific that no public money or property shall be appropriated
or applied for private purposes. This is in consonance with the fundamental principle in local fiscal
administration that local government funds and monies shall be spent solely for public purposes. 25
In Pascual v. Secretary of Public Works,26 the Court laid down the test of validity of a public
expenditure: it is the essential character of the direct object of the expenditure which must determine
 3

its validity and not the magnitude of the interests to be affected nor the degree to which the general
advantage of the community, and thus the public welfare, may be ultimately benefited by their
promotion.27 Incidental advantage to the public or to the State resulting from the promotion of private
interests and the prosperity of private enterprises or business does not justify their aid by the use of
public money.28
In Pascual, the validity of RA 920 ("An Act Appropriating Funds for Public Works") which
appropriated P85,000 for the construction, repair, extension and improvement of feeder roads within
a privately-owned subdivision was questioned. The Court held that where the land on which the
projected feeder roads were to be constructed belonged to a private person, an appropriation made
by Congress for that purpose was null and void.29
In Young v. City of Manila,30 the City of Manila undertook the filling of low-lying streets of the Antipolo
Subdivision, a privately-owned subdivision. The Court ruled that as long as the private owner
retained title and ownership of the subdivision, he was under the obligation to reimburse to the city
government the expenses incurred in land-filling the streets.
Moreover, the implementing rules of PD 957, as amended by PD 1216, provide that it is the
registered owner or developer of a subdivision who has the responsibility for the maintenance, repair
and improvement of road lots and open spaces of the subdivision prior to their donation to the
concerned LGU. The owner or developer shall be deemed relieved of the responsibility of
maintaining the road lots and open space only upon securing a certificate of completion and
executing a deed of donation of these road lots and open spaces to the LGU. 31
Therefore, the use of LGU funds for the widening and improvement of privately-owned sidewalks is
unlawful as it directly contravenes Section 335 of RA 7160. This conclusion finds further support
from the language of Section 17 of RA 7160 which mandates LGUs to efficiently and effectively
provide basic services and facilities. The law speaks of infrastructure facilities intended primarily to
service the needs of the residents of the LGU and "which are funded out of municipal funds."32 It
particularly refers to "municipal roads and bridges" and "similar facilities."33
Applying the rules of ejusdem generis, the phrase "similar facilities" refers to or includes
infrastructure facilities like sidewalks owned by the LGU. Thus, RA 7160 contemplates that only the
construction, improvement, repair and maintenance of infrastructure facilities owned by the LGU
may be bankrolled with local government funds.
Clearly, the question of ownership of the open spaces (including the sidewalks) in Marikina
Greenheights Subdivision is material to the determination of the validity of the challenged
appropriation and disbursement made by the City of Marikina. Similarly significant is the character
of the direct object of the expenditure, that is, the sidewalks.
Whether V.V. Soliven, Inc. has retained ownership of the open spaces and sidewalks or has already
donated them to the City of Marikina, and whether the public has full and unimpeded access to the
roads and sidewalks of Marikina Greenheights Subdivision, are factual matters. There is a need for
the prior resolution of these issues before the validity of the challenged appropriation and
expenditure can be determined.
WHEREFORE, this case is hereby ordered REMANDED to the Regional Trial Court of Marikina City
for the reception of evidence to determine (1) whether V.V. Soliven, Inc. has retained ownership of
the open spaces and sidewalks of Marikina Greenheights Subdivision or has donated them to the
City of Marikina and (2) whether the public has full and unimpeded access to, and use of, the roads
and sidewalks of the subdivision. The Marikina City Regional Trial Court is directed to decide the
case with dispatch.
SO ORDERED.
RENATO C. CORONA
Associate Justice
 4

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
(DSWD), Respondents.
DECISION
PERLAS-BERNABE, J.:
The Case
For the Court’s consideration in this Petition for Certiorari and Prohibition is the constitutionality of
certain provisions of Republic Act No. 10147 or the General Appropriations Act (GAA) of 2011 1 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.
The Facts
In 2007, the DSWD embarked on a poverty reduction strategy with the poorest of the poor as target
beneficiaries.2 Dubbed "Ahon Pamilyang Pilipino," it was pre-pilot tested in the municipalities of
Sibagat and Esperanza in Agusan del Sur; the municipalities of Lopez Jaena and Bonifacio in
Misamis Occidental, the Caraga Region; and the cities of Pasay and Caloocan3 upon the release of
the amount of P50 Million Pesos under a Special Allotment Release Order (SARO) issued by the
Department of Budget and Management.4
On July 16, 2008, the DSWD issued Administrative Order No. 16, series of 2008 (A.O. No. 16, s.
2008),5 setting the implementing guidelines for the project renamed "Pantawid Pamilyang Pilipino
Program" (4Ps), upon the following stated objectives, to wit:
1. To improve preventive health care of pregnant women and young children
2. To increase enrollment/attendance of children at elementary level
3. To reduce incidence of child labor
4. To raise consumption of poor households on nutrient dense foods
5. To encourage parents to invest in their children's (and their own) future
6. To encourage parent's participation in the growth and development of young children, as well as
involvement in the community.6
This government intervention scheme, also conveniently referred to as CCTP, "provides cash grant
to extreme poor households to allow the members of the families to meet certain human
development goals."7
Eligible households that are selected from priority target areas consisting of the poorest provinces
classified by the National Statistical Coordination Board (NCSB)8 are granted a health assistance of
P500.00/month, or P6,000.00/year, and an educational assistance of P300.00/month for 10 months,
or a total of P3,000.00/year, for each child but up to a maximum of three children per family. 9 Thus,
after an assessment on the appropriate assistance package, a household beneficiary could receive
from the government an annual subsidy for its basic needs up to an amount of P15,000.00, under
the following conditionalities:
 5

a) Pregnant women must get pre natal care starting from the 1st trimester, child birth is attended by
skilled/trained professional, get post natal care thereafter
b) Parents/guardians must attend family planning sessions/mother's class, Parent Effectiveness
Service and others
c) Children 0-5 years of age get regular preventive health check-ups and vaccines
d) Children 3-5 years old must attend day care program/pre-school
e) Children 6-14 years of age are enrolled in schools and attend at least 85% of the time 10
Under A.O. No. 16, s. 2008, the DSWD also institutionalized a coordinated inter-agency network
among the Department of Education (DepEd), Department of Health (DOH), Department of Interior
and Local Government (DILG), the National Anti-Poverty Commission (NAPC) and the local
government units (LGUs), identifying specific roles and functions in order to ensure effective and
efficient implementation of the CCTP. As the DSWD takes on the role of lead implementing agency
that must "oversee and coordinate the implementation, monitoring and evaluation of the program,"
the concerned LGU as partner agency is particularly tasked to –
a. Ensure availability of the supply side on health and education in the target areas.
b. Provide necessary technical assistance for Program implementation
c. Coordinate the implementation/operationalization of sectoral activities at the City/Municipal level
to better execute Program objectives and functions
d. Coordinate with various concerned government agencies at the local level, sectoral
representatives and NGO to ensure effective Program implementation
e. Prepare reports on issues and concerns regarding Program implementation and submit to the
Regional Advisory Committee, and
f. Hold monthly committee meetings11
A Memorandum of Agreement (MOA)12 executed by the DSWD with each participating LGU outlines
in detail the obligation of both parties during the intended five-year implementation of the CCTP.
Congress, for its part, sought to ensure the success of the CCTP by providing it with funding under
the GAA of 2008 in the amount of Two Hundred Ninety-Eight Million Five Hundred Fifty Thousand
Pesos (P298,550,000.00). This budget allocation increased tremendously to P5 Billion Pesos in
2009, with the amount doubling to P10 Billion Pesos in 2010. But the biggest allotment given to the
CCTP was in the GAA of 2011 at Twenty One Billion One Hundred Ninety-Four Million One Hundred
Seventeen Thousand Pesos (P21,194,117,000.00).13 1âwphi1
Petitioner Aquilino Pimentel, Jr., a former Senator, joined by Sergio Tadeo, incumbent President of
the Association of Barangay Captains of Cabanatuan City, Nueva Ecija, and Nelson Alcantara,
incumbent Barangay Captain of Barangay Sta. Monica, Quezon City, challenges before the Court
the disbursement of public funds and the implementation of the CCTP which are alleged to have
encroached into the local autonomy of the LGUs.
The Issue
THE P21 BILLION CCTP BUDGET ALLOCATION UNDER THE DSWD IN THE GAA FY 2011
VIOLATES ART. II, SEC. 25 & ART. X, SEC. 3 OF THE 1987 CONSTITUTION IN RELATION TO
SEC. 17 OF THE LOCAL GOVERNMENT CODE OF 1991 BY PROVIDING FOR THE
RECENTRALIZATION OF THE NATIONAL GOVERNMENT IN THE DELIVERY OF BASIC
SERVICES ALREADY DEVOLVED TO THE LGUS.
 6

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.
Our Ruling
The Constitution declares it a policy of the State to ensure the autonomy of local governments 14 and
even devotes a full article on the subject of local governance 15 which includes the following pertinent
provisions:
Section 3. The Congress shall enact a local government code which shall provide for a more
responsive and accountable local government structure instituted through a system of
decentralization with effective mechanisms of recall, initiative, and referendum, allocate among the
different local government units their powers, responsibilities, and resources, and provide for the
qualifications, election, appointment and removal, term, salaries, powers and functions and duties
of local officials, and all other matters relating to the organization and operation of the local units.
xxx
Section 14. The President shall provide for regional development councils or other similar bodies
composed of local government officials, regional heads of departments and other government
offices, and representatives from non-governmental organizations within the regions for purposes
of administrative decentralization to strengthen the autonomy of the units therein and to accelerate
the economic and social growth and development of the units in the region. (Underscoring supplied)
In order to fully secure to the LGUs the genuine and meaningful autonomy that would develop them
into self-reliant communities and effective partners in the attainment of national goals, 16 Section 17
of the Local Government Code vested upon the LGUs the duties and functions pertaining to the
delivery of basic services and facilities, as follows:
SECTION 17. Basic Services and Facilities. –
(a) Local government units shall endeavor to be self-reliant and shall continue exercising the powers
and discharging the duties and functions currently vested upon them. They shall also discharge the
functions and responsibilities of national agencies and offices devolved to them pursuant to this
Code. Local government units shall likewise exercise such other powers and discharge such other
functions and responsibilities as are necessary, appropriate, or incidental to efficient and effective
provision of the basic services and facilities enumerated herein.
(b) Such basic services and facilities include, but are not limited to, x x x.
While the aforementioned provision charges the LGUs to take on the functions and responsibilities
that have already been devolved upon them from the national agencies on the aspect of providing
for basic services and facilities in their respective jurisdictions, paragraph (c) of the same provision
provides a categorical exception of cases involving nationally-funded projects, facilities, programs
and services, thus:
 7

(c) Notwithstanding the provisions of subsection (b) hereof, public works and infrastructure projects
and other facilities, programs and services funded by the National Government under the annual
General Appropriations Act, other special laws, pertinent executive orders, and those wholly or
partially funded from foreign sources, are not covered under this Section, except in those cases
where the local government unit concerned is duly designated as the implementing agency for such
projects, facilities, programs and services. (Underscoring supplied)
The essence of this express reservation of power by the national government is that, unless an LGU
is particularly designated as the implementing agency, it has no power over a program for which
funding has been provided by the national government under the annual general appropriations act,
even if the program involves the delivery of basic services within the jurisdiction of the LGU.
The Court held in Ganzon v. Court of Appeals17 that while it is through a system of decentralization
that the State shall promote a more responsive and accountable local government structure, the
concept of local autonomy does not imply the conversion of local government units into "mini-
states."18 We explained that, with local autonomy, the Constitution did nothing more than "to break
up the monopoly of the national government over the affairs of the local government" and, thus, did
not intend to sever "the relation of partnership and interdependence between the central
administration and local government units." 19 In Pimentel v. Aguirre,20 the Court defined the extent
of the local government's autonomy in terms of its partnership with the national government in the
pursuit of common national goals, referring to such key concepts as integration and coordination.
Thus:
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.
Certainly, to yield unreserved power of governance to the local government unit as to preclude any
and all involvement by the national government in programs implemented in the local level would
be to shift the tide of monopolistic power to the other extreme, which would amount to a
decentralization of power explicated in Limbona v. Mangelin21 as beyond our constitutional concept
of autonomy, thus:
Now, autonomy is either decentralization of administration or decentralization of
power.1âwphi1 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’ and ‘ensure their
fullest development as self-reliant communities and make them more effective partners in the pursuit
of national development and social progress.’ 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 [sic]
favor of local governments [sic] units declared to be autonomous. In that case, the autonomous
government is free to chart its own destiny and shape its future with minimum intervention from
central authorities. According to a constitutional author, decentralization of power amounts to ‘self-
immolation,’ since in that event, the autonomous government becomes accountable not to the
central authorities but to its constituency.22
 8

Indeed, a complete relinquishment of central government powers on the matter of providing basic
facilities and services cannot be implied as the Local Government Code itself weighs against it. The
national government is, thus, not precluded from taking a direct hand in the formulation and
implementation of national development programs especially where it is implemented locally in
coordination with the LGUs concerned.
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.
WHEREFORE, premises considered, the petition is hereby DISMISSED.
SO ORDERED.
ESTELA M. PERLAS-BERNABE
Associate Justice
 9

G.R. No. 189041 July 31, 2012

CIVIL SERVICE COMMISSION, Petitoner,
vs.
DR. AGNES OUIDA P. YU, Respondent.
DECISION
PERLAS-BERNABE, J.:
In this Petition for Review on Certiorari under Rule 45 of the Rules of Court, the Civil Service
Commission (CSC) assails the Decision1 dated March 30, 2009 and the Resolution2 dated July 9,
2009 rendered by the Court of Appeals (CA) in CA-G.R. SP No. 00327-MIN declaring Dr. Agnes
Ouida P. Yu to have a vested right in the position of Chief of Hospital II until her retirement on August
24, 2004.
The Facts
In 1992, the national government implemented a devolution program pursuant to Republic Act (R.A.)
No. 7160, otherwise known as the ―The Local Government Code of 1991,” which affected the
Department of Health (DOH) along with other government agencies.
Prior to the devolution, Dr. Fortunata Castillo (hereinafter Dr. Castillo) held the position of Provincial
Health Officer II (PHO II) of the Department of Health (DOH) Regional Office No. IX in Zamboanga
City and was the head of both the Basilan Provincial Health Hospital and Public Health Services.
Respondent Dr. Agnes Ouida P. Yu (Dr. Yu), on the other hand, held the position of Provincial Health
Officer I (PHO I). She was assigned, however, at the Integrated Provincial Health Office in Isabela,
Basilan.
Upon the implementation of the devolution program, then Basilan Governor Gerry Salapuddin
(Governor Salapuddin) refused to accept Dr. Castillo as the incumbent of the PHO II position that
was to be devolved to the local government unit of Basilan, prompting the DOH to retain Dr. Castillo
at the Regional Office No. IX in Zamboanga City where she would serve the remaining four years
of her public service. She retired in 1996.
Meanwhile, in 1994, or two years after the implementation of the devolution program, Governor
Salapuddin appointed Dr. Yu to the PHO II position.
On February 23, 1998, Republic Act No. 8543, otherwise known as ―An Act Converting the Basilan
Provincial Hospital in the Municipality of Isabela, Province of Basilan, into a Tertiary Hospital Under
the Full Administrative and Technical Supervision of the Department of Health, Increasing the
Capacity to One Hundred Beds and Appropriating Funds Therefor," was passed into law whereby
the hospital positions previously devolved to the local government unit of Basilan were re-
nationalized and reverted to the DOH. The Basilan Provincial Health Hospital was later renamed the
Basilan General Hospital, and the position of PHO II was then re-classified to Chief of Hospital II.
While Dr. Yu was among the personnel reverted to the DOH with the re-nationalization of the Basilan
General Hospital, she was made to retain her original item of PHO II instead of being given the re-
classified position of Chief of Hospital II. Subsequently, on August 1, 2003, then DOH Secretary
Manuel M. Dayrit (Secretary Dayrit) appointed Dr. Domingo Remus A. Dayrit (Dr. Dayrit) to the
position of Chief of Hospital II.
Aggrieved, Dr. Yu filed a letter of protest dated September 30, 2003 3 before the CSC claiming that
she has a vested right to the position of Chief of Hospital II. The pertinent portions of said letter read:
I come before your good office protesting the appointment issued by … DOH Secretary Manuel M.
Dayrit in favor of Dr. Domingo Remus A. Dayrit as Chief of Hospital … of the Basilan General
Hospital …
 10

xxx
… the position of Chief of Hospital II to which Dr. Dayrit has been appointed is a mere conversion
from the item of Provincial Health Officer II previously occupied by the herein protestant.
When what used to be called the Basilan Provincial Hospital was re-nationalized, now called the
Basilan General Hospital, the position of Provincial Health Officer II, then occupied by the
undersigned, was refused re-nationalized (sic) by DOH alleging the same position to be an LGU-
created position, that is, that the Local Government of Basilan created the position. Thus, instead of
the undersigned being automatically re-appointed Provincial Health Officer II of the Hospital, later
to be renamed Chief of Hospital II, pursuant to the Re-Nationalization Law, she was instead given
an appointment still as Provincial Health Officer II but under a co-terminous status at the Center for
Health and Development, DOH … which position the undersigned refused to accept...
On June 7, 2004, the CSC issued Resolution4 No. 040655 granting Dr. Yu's protest and revoking
the appointment of Dr. Dayrit as Chief of Hospital II of Basilan General Hospital. Further, Secretary
Dayrit was directed to appoint Dr. Yu to said position. Upon motion for reconsideration, however,
the CSC reversed itself and issued Resolution5 No. 040967 dated September 1, 2004 declaring that
the position of PHO II was never devolved to the Provincial Government of Basilan but was retained
by the DOH; that the PHO II position held by Dr. Yu was a newly-created position; and that, therefore,
she did not have a vested right to the Chief of Hospital II position that was created by virtue of R.A
No. 8543.
Dr. Yu then filed a motion for reconsideration which was denied by the CSC in its Resolution 6 No.
050287 dated February 28, 2005. She then elevated her case to the CA on petition for review raising
the sole issue of whether the item of PHO II she previously occupied was a devolved position or a
locally created one.
On March 30, 2009, the CA rendered the assailed Decision in favor of Dr. Yu, disposing as follows:
FOR REASONS STATED, the Petition for Review is GRANTED and CSC Resolutions Nos. 040967
and 050287 are REVERSED and SET ASIDE. Petitioner is declared to have a vested right in the
Chief of Hospital II position up to her retirement in August 24, 2004 and should receive her
corresponding salaries and benefits.
SO ORDERED.7
In ruling that the PHO II position was devolved to the Basilan Provincial Government, the appellate
court ratiocinated in this wise:
xxx The CSC’s ruling that there are two PHO II positions is not implausible but contrary to the
evidence on hand.
A perusal of the pleadings and attachments reveal that the PHO II position was devolved to the
Basilan Provincial Government. In a letter dated May 19, 1994, Ms. Vivian L. Young, Officer-in-
Charge of the Department of Health, Local Government Assistance & Monitoring Service informed
former Governor Salapuddin that the PHO II position was devolved to the local government, viz:
Dear Gov. Salapuddin,
This will refer to your letter relative to the item position of Dr. Fortunata C. Castillo which has been
devolved to the provincial government of BASILAN.
Please be informed that only the devolved health personnel who were not accepted by their Local
Chief Executive have been retained by DOH, the item positions per se remained in the respective
LGU’s. xxx The LGU’s have the option to retain the items vacated or to collapse the same for
financial reasons.
xxx
 11

Based on the foregoing letter, Dr. Milagros L. Fernandez, Director IV of the DOH – Regional Field
Office No. IX, Zamboanga City, wrote a letter to petitioner, to wit:
xxx
Madam:
The letter dated May 19, 1994 of Ms. Vivian L. Young, Office-in-Charge (sic), LGAMS, Department
of Health, clarifies the issue raised by the Provincial Governor, in his letter dated April 14, 1994,
insofar as the retention of the Provincial Health Officer II of the province, in the person of Dr.
Fortunata Castillo by the DOH in view of the non-acceptance by the Governor consistent with the
provisions of law on devolution.
1. Dr. Fortunata A. Castillo, who was holding the position of Provincial Health Officer II of the
province, and a devolved health personnel, was retained by the DOH for reason above-mentioned.
2. While she, the occupant, was retained, the item position remained as among those items in the
Plantilla of Personnel of the Integrated Provincial Health Office devolved to the Office of the
Provincial Governor.
3. The Governor, in such a case, may or may not retain her item in his Plantilla, or abolish it for
reason therein stated. The position herewith (sic) was left vacant with the retention of Dr. Castillo in
this office.
4. The funds for salary and other benefits of the devolved item position of Provincial Health Officer
II remained devolved with the Office of the Governor.
In other words, with the retention of Dr. Castillo hereto, she never carried with her the item position
and the funds appropriated for salary and other benefits accruing to the position of Provincial Health
Officer II.
xxx
In a letter dated October 26, 2001, Director Macybel Alfaro-Sashi of the Civil Service Commission
Regional Office IX informed the petitioner that:
At the outset, it is apparent that the position you presently occupy is one which should be included
in the list of renationalized positions notwithstanding the fact that the said position carries a position
item number different from that carried by the previous holder thereof. Hence, the contention of the
DOH Regional Office that your position is not the same as that of the previous holder simply because
they bear different position item numbers deserves very scant consideration. The position item
numbers are immaterial in case of renationalization as such a system is merely adopted for purposes
of proper and systematic coding of all positions in the government, particularly in the budgeting
process. Thus, the position you are presently holding should be considered as one belonging to the
national government prior to its devolution, regardless of the position item number attached to the
position of the previous holder thereof.
Thus, it is apparent that the PHO II position occupied by petitioner is one and the same position
which was previously occupied by Dr. Castillo before the devolution. When the latter was not
accepted by Gov. Salapuddin, Dr. Castillo was retained by the DOH but the PHO II item was
devolved to the Provincial Government of Basilan. Consequently, the position of PHO II became
vacant. This is obvious by the fact that the salaries of Dr. Castillo were taken from a special fund
and not from the appropriation for the PHO II position.
The motion for reconsideration of the foregoing Decision filed by the CSC was denied by the CA in
its Resolution8 dated July 9, 2009. Hence, in this petition for review on certiorari, the CSC alleged
that -
The Issue
 12

THE COURT OF APPEALS ERRED IN HOLDING THAT THE PHO II POSITION PREVIOUSLY
OCCUPIED BY RESPONDENT YU IS A DEVOLVED POSITION.9
The Ruling of the Court
In pursuance of the declared policy under The Local Government Code of 1991 (R.A. No. 7160) to
provide for a more responsive and accountable local government structure through a system of
decentralization,10 national agencies or offices, including the DOH, were mandated to devolve to the
local government units the responsibility for the provision of basic services and facilities. 11
As defined, ―devolution‖ is the act by which the national government confers power and authority
upon the various local government units to perform specific functions and
responsibilities.12 Specifically, Section 17(i) of the same Code prescribes the manner of devolution,
as follows:
(i) The devolution contemplated in this Code shall include the transfer to local government units of
the records, equipment, and other assets and personnel of national agencies and offices
corresponding to the devolved powers, functions and responsibilities.
Personnel of said national agencies or offices shall be absorbed by the local government units to
which they belong or in whose areas they are assigned to the extent that it is administratively viable
as determined by the said oversight committee: Provided, further, That regional directors who are
career executive service officers and other officers of similar rank in the said regional offices who
cannot be absorbed by the local government unit shall be retained by the national government,
without any diminution of rank, salary or tenure.
To ensure the proper implementation of the devolution process, then President Corazon C. Aquino
issued Executive Order (E.O.) No. 503, otherwise known as the ―Rules and Regulations
Implementing the Transfer of Personnel and Assets, Liabilities and Records of National Government
Agencies Whose Functions Are To Be Devolved To The Local Government Units And For Other
Related Purposes," which laid down the following pertinent guidelines with respect to the transfer of
personnel:
Section 2. Principles and Policies Governing Transfer of Personnel. -
a. Coverage, Tenure, Compensation and Career Development. —
xxx
2. The absorption of the NGA personnel by the LGU shall be mandatory, in which case, the LGUs
shall create the equivalent positions of the affected personnel except when it is not administratively
viable.
3. Absorption is not administratively viable when there is a duplication of functions unless the LGU
opts to absorb the personnel concerned.
4. The national personnel who are not absorbed by the LGUs under no. 3 above, shall be retained
by the NGA concerned, subject to civil service law, rules and regulations.
xxx
12. Except as herein otherwise provided, devolved permanent personnel shall be automatically
reappointed by the local chief executive concerned immediately upon their transfer which shall not
go beyond June 30, 1992. xxx
On the basis of the foregoing, it was mandatory for Governor Salapuddin to absorb the position of
PHO II, as well as its incumbent, Dr. Fortunata Castillo. Highlighting the absence of discretion is the
use of the word ―shall‖ both in Section 17 (i) of R.A. No. 7160 and in Section 2(a)(2) of E.O. No.
503, which connotes a mandatory order. Its use in a statute denotes an imperative obligation and is
inconsistent with the idea of discretion.13 The only instance that the LGU concerned may choose not
 13

to absorb the NGA personnel is when absorption is not administratively viable, meaning, it would
result to duplication of functions, in which case, the NGA personnel shall be retained by the national
government. However, in the absence of the recognized exception, devolved permanent personnel
shall be automatically reappointed Section 2(a)(12) by the local chief executive concerned
immediately upon their transfer which shall not go beyond June 30, 1992. Webster's Third New
International Dictionary defines ―automatic‖ as ―involuntary either wholly or to a major extent so
that any activity of the will is largely negligible.” Being ―automatic‖, thus, connotes something
mechanical, spontaneous and perfunctory.14
There is no dearth of evidence showing that the item position of PHO II was, in fact, devolved to the
Provincial Government of Basilan. Governor Salapuddin himself certified 15 that said position was
included in the 1992 OSCAS16 received from the Department of Budget and Management (DBM)
with its corresponding budget appropriation. He further declared that during the formal turn over
program in 1993 attended by Dr. Milagros Fernandez, representing the DOH Regional Office, the
item position of PHO II was among the positions turned over to the Provincial Government of
Basilan. Thus, the argument17 of petitioner CSC that only 53 plantilla positions, not 54, were
devolved to the local government of Basilan does not hold water. It cannot be disputed that Dr.
Castillo's PHO II position was devolved.
However, Governor Salapuddin refused to reappoint Dr. Castillo to her devolved position in the LGU
for no other reason than that he ―wanted to accept only the item position of PHO II.” 18 It was not
shown, and no attempt was ever made on the part of the LGU to show, that the absorption of Dr.
Castillo was not administratively viable. There being no valid and legal basis therefor, Governor
Salapuddin's refusal to accept Dr. Castillo was, plainly and simply, whimsical.1âwphi1
Be that as it may, Governor Salapuddin's refusal did not prevent the devolution of Dr.Castillo which,
together with that of the PHO II position, took effect by operation of law. In order to solve his dilemma,
Governor Salapuddin requested that Dr. Castillo be detailed instead at the DOH, which was
confirmed by then Secretary of Health Juan M. Flavier in his Department Order 19 No. 228, series of
1993, signed on July 9, 1993, reproduced hereunder as follows:
This will officially confirm the detail of Dr. Fortunata A. Castillo PHO-II – Basilan at the Regional
Health Field Office No. IX, Zamboanga City per request of the Governor of Basilan, the Honorable
Jerry (sic) Salapuddin in his letter to Dr. Castillo, provided that the provincial government of Basilan
will continue to pay her salary and other benefits she's entitled thereto until further notice or order.
(Emphasis added)
Clearly therefore, the drawing of Dr. Castillo's salary from the LGU of Basilan which Governor
Salapuddin claimed to have allowed simply ―to accommodate her (Dr. Castillo)" 20 was, in fact, a
necessary consequence of her devolution to the LGU and subsequent detail to the DOH. Officials
and employees on detail with other offices shall be paid their salaries, emoluments, allowances,
fringe benefits and other personal services costs from the appropriations of their parent agencies
and in no case shall such be charged against the appropriations of the agencies where they are
assigned or detailed, except when authorized by law. 21
A detail is defined and governed by Executive Order 292, Book V, Title 1, Subtitle A, Chapter 5,
Section 26 (6), thus:22
(6) Detail. A detail is the movement of an employee from one agency to another without the issuance
of an appointment and shall be allowed, only for a limited period in the case of employees occupying
professional, technical and scientific positions. If the employee believes that there is no justification
for the detail, he may appeal his case to the Commission. Pending appeal, the decision to detail the
employee shall be executory unless otherwise ordered by the Commission. (Emphasis added)
Had Dr. Castillo felt aggrieved by her detail to the DOH Regional Office, she was not without
recourse. The law afforded her the right to appeal her case to the CSC, but she had not seen fit to
question the justification for her detail. We could only surmise that, since Dr. Castillo was looking at
 14

only three more years from the time of her detail until her retirement in 1996, and considering that
she obviously would not suffer any diminution in salary and rank, she found it pointless to pursue
the matter.
Neither did Dr. Castillo find need to raise a howl when, at the behest of Governor Salapuddin who
was determined to replace her, DOH officials categorized her as a devolution non-viable employee,
along with 216 others nationwide, by the mere fact that she was not accepted by the LGU of Basilan
and not because of an actual non-viability. Hence, in 1994, when Governor Salapuddin formally
manifested his intention to stop the drawing of Dr. Castillo's salary from the LGU in anticipation of
his appointment of Dr. Yu to the PHO II position, Dr. Castillo ceased to be a detailed employee at
the DOH Regional Office but was re-absorbed by the DOH as a devolution non-viable employee
and, consequently, paid salaries and benefits from the Miscellaneous Personnel Benefits Fund that
had been set aside under the Office of the Secretary of Health precisely for such employees.
Ms. Vivian L. Young, Officer-In-Charge of the DOH Local Government Assistance and Monitoring
Service, assured23 Governor Salapuddin that, while Dr. Castillo was ―retained‖ by the DOH, her
item position remained with the LGU of Basilan. Moreover, Dr. Milagros L. Fernandez, Director IV
of the DOH Regional Field Office No. IX in Zamboanga City, clarified24 that Dr. Castillo ―never
carried with her the item position and the funds appropriated for salary and other benefits accruing
to the position of Provincial Health Officer II.”
Hence, the appointment of Dr. Yu to the position PHO II.
The next question to be answered is – may Dr. Castillo be considered to have abandoned her
position for consistently failing to assert her rights thereto?
We certainly do not believe so.
―Abandonment of an office is the voluntary relinquishment of an office by the holder with the
intention of terminating his possession and control thereof. In order to constitute abandonment of
office, it must be total and under such circumstance as clearly to indicate an absolute relinquishment.
There must be a complete abandonment of duties of such continuance that the law will infer a
relinquishment. Abandonment of duties is a voluntary act; it springs from and is accompanied by
deliberation and freedom of choice. There are, therefore, two essential elements of abandonment:
first, an intention to abandon and, second, an overt or 'external' act by which the intention is carried
into effect."25
By no stretch of the imagination can Dr. Castillo's seeming lackadaisical attitude towards protecting
her rights be construed as an abandonment of her position resulting in her having intentionally and
voluntarily vacated the same. Governor Salapuddin's tenacious refusal to accept Dr. Castillo
negates any and all voluntariness on the part of the latter to let go of her position. The risk of incurring
the ire of a powerful politician effectively tied Dr. Castillo's hands, and it was quite understandable
that she could not don her gloves and fight, even if she wanted to. Considering, however, that
Governor Salapuddin's clear infraction of the law is not in issue before us, we need not make any
pronouncement on this matter.
We rule, therefore, under the attendant circumstances of the case, that with Dr. Castillo's re-
absorption by the DOH which appears to bear the former's approval, her devolved position with the
LGU of Basilan was left vacant. In her May 19, 1994 letter to Governor Salapuddin, Ms. Vivian L.
Young informed the local chief executive that he had the ―option to retain the item vacated or to
collapse the same for financial reasons.”26 Thus, we hold that Dr. Yu was validly appointed to the
position of PHO II in 1994 and, consequently, acquired a vested right to its re-classified designation
– Chief of Hospital II. As such, Dr. Yu should have been automatically re-appointed by Secretary
Dayrit in accordance with the Guidelines for the Re-Nationalization of Personnel, Assets and
Appropriations of Basilan Provincial Hospital,27 the pertinent portion of which provides, as follows:
Item III. Principles and Policies Governing the Transfer of Basilan Provincial Hospital
 15

A) xxx
3) The DOH shall assure that the re-nationalized personnel of the hospital shall:
3.i) Not be involuntarily separated, terminated or laid off;
3.ii) Continue to enjoy security of tenure;
3.iii) Be automatically re-appointed by the Secretary immediately upon their transfer;
3.iv) Retain their pay or benefits without diminution. (Emphasis supplied)
Considering, however, that Dr. Yu had already retired on August 24, 2004, we uphold the following
findings of the appellate court, to wit:
xxx ln as much as a re-appointment is no longer feasible due to her retirement, petitioner should at
least recover her salaries for the services she had rendered. However, petitioner admitted that she
received her salary as PHO II converted to Chief of Hospital for the period August to November
2001. Therefore, she should receive her salary and benefits as Chief of Hospital from December
2001 up to her retirement in August 24, 2004. 28
WHEREFORE, the instant petition is hereby DENIED for lack of merit. The assailed Decision dated
March 30, 2009 in CA-G.R. SP No. 00327-MIN is AFFIRMED.
SO ORDERED.
ESTELA M. PERLAS-BERNABE
Associate Justice
 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.
DECISION
PERALTA, J.:
This is a petition for certiorari, prohibition and mandamus, 1 praying that this Court order the
following: ( 1) declare as unconstitutional Section 17(b)(3)(iii) of Republic Act (R.A.) No. 7160,
otherwise known as The Local Government Code of 1991 and Section 24 of Republic Act (R.A.) No.
7076, otherwise known as the People's Small-Scale Mining Act of 1991; (2) prohibit and bar
respondents from exercising control over provinces; and (3) declare as illegal the respondent
Secretary of the Department of Energy and Natural Resources' (DENR) nullification, voiding and
cancellation of the Small-Scale Mining permits issued by the Provincial Governor of Bulacan.
The Facts are as follows:
On March 28, 1996, Golden Falcon Mineral Exploration Corporation (Golden Falcon) filed with the
DENR Mines and Geosciences Bureau Regional Office No. III (MGB R-III) an Application for
Financial and Technical Assistance Agreement (FTAA) covering an area of 61,136 hectares situated
in the Municipalities of San Miguel, San Ildefonso, Norzagaray and San Jose del Monte, Bulacan.2
On April 29, 1998, the MGB R-III issued an Order denying Golden Falcon's Application for Financial
and Technical Assistance Agreement for failure to secure area clearances from the Forest
Management Sector and Lands Management Sector of the DENR Regional Office No. III. 3
On November 11, 1998, Golden Falcon filed an appeal with the DENR Mines and Geosciences
Bureau Central Office (MGB-Central Office), and sought reconsideration of the Order dated April
29, 1998.4
On February 10, 2004, while Golden Falcon's appeal was pending, Eduardo D. Mercado, Benedicto
S. Cruz, Gerardo R. Cruz and Liberato Sembrano filed with the Provincial Environment and Natural
Resources Office (PENRO) of Bulacan their respective Applications for Quarry Permit (AQP), which
covered the same area subject of Golden Falcon's Application for Financial and Technical
Assistance Agreement.5
On July 16, 2004, the MGB-Central Office issued an Order denying Golden Falcon's appeal and
affirming the MGB R-III's Order dated April 29, 1998.
On September 13, 2004, Atlantic Mines and Trading Corporation (AMTC) filed with the PENRO of
Bulacan an Application for Exploration Permit (AEP) covering 5,281 hectares of the area covered
by Golden Falcon's Application for Financial and Technical Assistance Agreement. 6
On October 19, 2004, DENR-MGB Director Horacio C. Ramos, in response to MGB R-III Director
Arnulfo V. Cabantog's memorandum query dated September 8, 2004, categorically stated that the
MGB-Central Office's Order dated July 16, 2004 became final on August 11, 2004, fifteen (15) days
after Golden Falcon received the said Order, per the Certification dated October 8, 2004 issued by
the Postmaster II of the Philippine Postal Corporation of Cainta, Rizal.7
Through letters dated May 5 and May 10, 2005, AMTC notified the PENRO of Bulacan and the MGB
R-III Director, respectively, that the subject Applications for Quarry Permit fell within its (AMTC's)
existing valid and prior Application for Exploration Permit, and the the former area of Golden Falcon
was open to mining location only on August 11, 2004 per the Memorandum dated October 19, 2004
of the MGB Director, Central Office.8
 17

On June 24, 2005, Ricardo Medina, Jr., PENRO of Bulacan, indorsed AMTC's letter to the Provincial
Legal Officer, Atty. Eugenio F. Resurreccion, for his legal opinion on which date of denial of Golden
Falcon's application/appeal – April 29, 1998 or July 16, 2004 − is to be considered in the deliberation
of the Provincial Mining Regulatory Board (PMRB) for the purpose of determining when the land
subject of the Applications for Quarry Permit could be considered open for application.
On June 28, 2005, Provincial Legal Officer Eugenio Resurreccion issued a legal opinion stating that
the Order dated July 16, 2004 of the MGB-Central Office was a mere reaffirmation of the Order
dated April 29, 1998 of the MGB R-III; hence, the Order dated April 29, 1998 should be the reckoning
period of the denial of the application of Golden Falcon.
On July 22, 2005, AMTC filed with the PMRB of Bulacan a formal protest against the aforesaid
Applications for Quarry Permit on the ground that the subject area was already covered by its
Application for Exploration Permit.9
On August 8, 2005, MGB R-III Director Cabantog, who was the concurrent Chairman of the PMRB,
endorsed to the Provincial Governor of Bulacan, Governor Josefina M. dela Cruz, the aforesaid
Applications for Quarry Permit that had apparently been converted to Applications for Small-Scale
Mining Permit of Eduardo D. Mercado, Benedicto S. Cruz, Gerardo R. Cruz and Lucila S. Valdez
(formerly Liberato Sembrano).10
On August 9, 2005, the PENRO of Bulacan issued four memoranda recommending to Governor
Dela Cruz the approval of the aforesaid Applications for Small-Scale Mining Permit.11
On August 10, 2005, Governor Dela Cruz issued the corresponding Small-Scale Mining Permits in
favor of Eduardo D. Mercado, Benedicto S. Cruz, Gerardo R. Cruz and Lucila S. Valdez. 12
Subsequently, AMTC appealed to respondent DENR Secretary the grant of the aforesaid Small-
Scale Mining Permits, arguing that: (1) The PMRB of Bulacan erred in giving due course to the
Applications for Small-Scale Mining Permit without first resolving its formal protest; (2) The areas
covered by the Small-Scale Mining Permits fall within the area covered by AMTC's valid prior
Application for Exploration Permit; (3) The Applications for Quarry Permit were illegally converted to
Applications for Small-Scale Mining Permit; (4) DENR-MGB Director Horacio C. Ramos' ruling that
the subject areas became open for mining location only on August 11, 2004 was controlling; (5) The
Small-Scale Mining Permits were null and void because they covered areas that were never
declared People's Small-Scale Mining Program sites as mandated by Section 4 of the People's
Small-Scale Mining Act of 1991; and (6) Iron ore is not considered as one of the quarry resources,
as defined by Section 43 of the Philippine Mining Act of 1995, which could be subjects of an
Application for Quarry Permit.13
On August 8, 2006, respondent DENR Secretary rendered a Decision 14 in favor of AMTC. The
DENR Secretary agreed with MGB Director Horacio C. Ramos that the area was open to mining
location only on August 11, 2004, fifteen (15) days after the receipt by Golden Falcon on July 27,
2004 of a copy of the MGB-Central Office's Order dated July 16, 2004, which Order denied Golden
Falcon's appeal. According to the DENR Secretary, the filing by Golden Falcon of the letter-appeal
suspended the finality of the Order of denial issued on April 29, 1998 by the Regional Director until
the resolution of the appeal on July 16, 2004 by the MGB-Central Office. He stated that the
Applications for Quarry Permit were filed on February 10, 2004 when the area was still closed to
mining location; hence, the Small-Scale Mining Permits granted by the PMRB and the Governor
were null and void. On the other hand, the DENR Secretary declared that AMTC filed its Application
for Exploration Permit when the area was already open to other mining applicants; thus, AMTC’s
Application for Exploration Permit was valid. Moreover, the DENR Secretary held that the
questioned Small-Scale Mining Permits were issued in violation of Section 4 of R.A. No. 7076 and
beyond the authority of the Provincial Governor pursuant to Section 43 of R.A. No. 7942, because
the area was never proclaimed to be under the People's Small-Scale Mining Program. Further, the
DENR Secretary stated that iron ore mineral is not considered among the quarry resources.
 18

The dispositive portion of the DENR Secretary’s Decision reads:

WHEREFORE, the Application for Exploration Permit, AEP-III-02-04 of Atlantic Mines and Trading
Corp. is declared valid and may now be given due course. The Small-Scale Mining Permits, SSMP-
B-002-05 of Gerardo Cruz, SSMP-B-003-05 of Eduardo D. Mercado, SSMP-B-004-05 of Benedicto
S. Cruz and SSMP-B-005-05 of Lucila S. Valdez are declared NULL AND VOID. Consequently, the
said permits are hereby CANCELLED.15
Hence, petitioner League of Provinces filed this petition.
Petitioner is a duly organized league of local governments incorporated under R.A. No. 7160.
Petitioner declares that it is composed of 81 provincial governments, including the Province of
Bulacan. It states 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.
Petitioner raises these issues:
I
WHETHER OR NOT SECTION 17(B)(3)(III) OF THE, 1991 LOCAL GOVERNMENT CODE AND
SECTION 24 OF THE PEOPLE'S SMALL-SCALE MINING ACT OF 1991 ARE
UNCONSTITUTIONAL FOR PROVIDING FOR EXECUTIVE CONTROL AND INFRINGING UPON
THE LOCAL AUTONOMY OF PROVINCES.
II
WHETHER OR NOT THE ACT OF RESPONDENT [DENR] IN NULLIFYING, VOIDING AND
CANCELLING THE SMALL-SCALE MINING PERMITS AMOUNTS TO EXECUTIVE CONTROL,
NOT MERELY SUPERVISION AND USURPS THE DEVOLVED POWERS OF ALL PROVINCES. 16
To start, 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;17 adopt measures for the promotion of the welfare of all provinces and its officials
and employees;18 and exercise such other powers and perform such other duties and functions as
the league may prescribe for the welfare of the provinces.19
Before this Court determines the validity of an act of a co-equal and coordinate branch of the
Government, it bears emphasis that ingrained in our jurisprudence is the time-honored principle that
a statute is presumed to be valid.20 This presumption is rooted in the doctrine of separation of powers
which enjoins upon the three coordinate departments of the Government a becoming courtesy for
each other's acts.21 This Court, however, may declare a law, or portions thereof, unconstitutional
where a petitioner has shown a clear and unequivocal breach of the Constitution, 22 leaving no doubt
or hesitation in the mind of the Court.23
In this case, petitioner admits that respondent DENR Secretary had the authority to nullify the Small-
Scale Mining Permits issued by the Provincial Governor of Bulacan, as the DENR Secretary has
control over the PMRB, and the implementation of the Small-Scale Mining Program is subject to
control by respondent DENR.
Control of the DENR/DENR Secretary over small-scale mining in the provinces is granted by three
statutes: (1) R.A. No. 7061 or The Local Government Code of 1991; (2) R.A. No. 7076 or the
People's Small Scale Mining Act of 1991; and (3) R.A. No. 7942, otherwise known as the Philippine
Mining Act of 1995.24 The pertinent provisions of law sought to be declared as unconstitutional by
petitioner are as follows:
R.A. No. 7061 (The Local Government Code of 1991)
 19

SEC. 17. Basic Services and Facilities. - (a) Local government units shall endeavor to be self-reliant
and shall continue exercising the powers and discharging the duties and functions currently vested
upon them. They shall also discharge the functions and responsibilities of national agencies and
offices devolved to them pursuant to this Code. Local government units shall likewise exercise such
other powers and discharge such other functions and responsibilities as are necessary, appropriate,
or incidental to efficient and effective provision of the basic services and facilities enumerated herein.
(b) Such basic services and facilities include, but are not limited to, the following:
xxxx
(3) For a Province:c
xxxx
(iii) Pursuant to national policies and subject to supervision, control and review of the DENR,
enforcement of forestry laws limited to community-based forestry projects, pollution control law,
small-scale mining law, and other laws on the protection of the environment; and mini-hydro electric
projects for local purposes; x x x25
R.A. No. 7076 (People's Small-Scale Mining Act of 1991)
Sec. 24. Provincial/City Mining Regulatory Board. - There is hereby created under the direct
supervision and control of the Secretary a provincial/city mining regulatory board, herein called the
Board, which shall be the implementing agency of the Department, and shall exercise the following
powers and functions, subject to review by the Secretary:
(a) Declare and segregate existing gold-rush areas for small-scale mining;
(b) Reserve future gold and other mining areas for small-scale mining;
(c) Award contracts to small-scale miners;
(d) Formulate and implement rules and regulations related to small-scale mining;
(e) Settle disputes, conflicts or litigations over conflicting claims within a people’s small-scale mining
area, an area that is declared a small-mining; and
(f) Perform such other functions as may be necessary to achieve the goals and objectives of this
Act.26
Petitioner contends that the aforecited laws and DENR Administrative Order No. 9640 (the
Implementing Rules and Regulations of the Philippine Mining Act of 1995) did not explicitly confer
upon respondents DENR and the DENR Secretary the power to reverse, abrogate, nullify, void, or
cancel the permits issued by the Provincial Governor or small-scale mining contracts entered into
by the PMRB. The statutes are also silent as to the power of respondent DENR Secretary to
substitute his own judgment over that of the Provincial Governor and the PMRB.
Moreover, petitioner contends that Section 17 (b)(3)(iii) of the Local Government Code of 1991 and
Section 24 of R.A. No. 7076, which confer upon respondents DENR and the DENR Secretary the
power of control are unconstitutional, as the Constitution states that the President (and Executive
Departments and her alter-egos) has the power of supervision only, not control, over acts of the
local government units, and grants the local government units autonomy, thus:
The 1987 Constitution:
Article X, Section 4. The President of the Philippines shall exercise general supervision over local
governments. Provinces with respect to component cities and municipalities, and cities and
municipalities with respect to component barangays, shall ensure that the acts of their component
units are within the scope of their prescribed powers and functions.27
 20

Petitioner contends that the policy in the above-cited constitutional provision is mirrored in the Local
Government Code, which states:
SEC. 25. National Supervision over Local Government Units. - (a) Consistent with the basic policy
on local autonomy, the President shall exercise general supervision over local government units to
ensure that their acts are within the scope of their prescribed powers and functions.
The President shall exercise supervisory authority directly over provinces, highly urbanized cities,
and independent component cities; through the province with respect to component cities and
municipalities; and through the city and municipality with respect to barangays. 28
Petitioner contends that the foregoing provisions of the Constitution and the Local Government Code
of 1991 show that the relationship between the President and the Provinces or respondent DENR,
as the alter ego of the President, and the Province of Bulacan is one of executive supervision, not
one of executive control. The term "control" has been defined as 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, while the term "supervision" is the power of a
superior officer to see to it that lower officers perform their function in accordance with law. 29
Petitioner argues that respondent DENR Secretary went beyond mere executive supervision and
exercised control when he nullified the small-scale mining permits granted by the Provincial
Governor of Bulacan, as the former substituted the judgment of the latter.
Petitioner asserts that what is involved here is a devolved power.
Under the Local Government Code of 1991, the power to regulate small-scale mining has been
devolved to all provinces. In the exercise of devolved powers, departmental approval is not
necessary.30
Petitioner contends that if the provisions in Section 24 of R.A. No. 7076 and Section 17 (b)(3)(iii) of
the Local Government Code of 1991 granting the power of control to the DENR/DENR Secretary
are not nullified, nothing would stop the DENR Secretary from nullifying, voiding and canceling the
small-scale mining permits that have been issued by a Provincial Governor.
Petitioner submits that the statutory grant of power of control to respondents is unconstitutional, as
the Constitution only allows supervision over local governments and proscribes control by the
executive departments.
In its Comment, respondents, represented by the Office of the Solicitor General, stated that contrary
to the assertion of petitioner, the power to implement the small-scale mining law is expressly limited
in Section 17 (b)(3)(iii) of the Local Government Code, which provides that it must be carried out
"pursuant to national policies and subject to supervision, control and review of the DENR." Moreover,
the fact that the power to implement the small-scale mining law has not been fully devolved to
provinces is further amplified by Section 4 of the People's Small-Scale Mining Act of 1991, which
provides, among others, that the People's Small-Scale Mining Program shall be implemented by the
DENR Secretary.
The petition lacks merit.
Paragraph 1 of Section 2, Article XII (National Economy and Patrimony) of the
Constitution31 provides that "the exploration, development and utilization of natural resources shall
be under the full control and supervision of the State."
Moreover, paragraph 3 of Section 2, Article XII of the Constitution provides that "the Congress may,
by law, allow small-scale utilization of natural resources by Filipino citizens x x x."
Pursuant to Section 2, Article XII of the Constitution, R.A. No. 7076 or the People's Small-Scale
Mining Act of 1991, was enacted, establishing under Section 4 thereof a People's Small-Scale
 21

Mining Program to be implemented by the DENR Secretary in coordination with other concerned
government agencies.
The People's Small-Scale Mining Act of 1991 defines "small-scale mining" as "refer[ring] to mining
activities, which rely heavily on manual labor using simple implement and methods and do not use
explosives or heavy mining equipment."32
It should be pointed out that the Administrative Code of 198733 provides that the DENR is, subject
to law and higher authority, in charge of carrying out the State's constitutional mandate, under
Section 2, Article XII of the Constitution, to control and supervise the exploration, development,
utilization and conservation of the country's natural resources. Hence, the enforcement of small-
scale mining law in the provinces is made subject to the supervision, control and review of the DENR
under the Local Government Code of 1991, while the People’s Small-Scale Mining Act of 1991
provides that the People’s Small-Scale Mining Program is to be implemented by the DENR
Secretary in coordination with other concerned local government agencies.
Indeed, Section 4, Article X (Local Government) of the Constitution states that "[t]he President of
the Philippines shall exercise general supervision over local governments," and Section 25 of the
Local Government Code reiterates the same. General supervision by the President means no more
than seeing to it that laws are faithfully executed or that subordinate officers act within the law. 34
The Court has clarified that the constitutional guarantee of local autonomy in the Constitution Art. X,
Sec. 2 refers to the administrative autonomy of local government units or, cast in more technical
language, the decentralization of government authority. 35 It does not make local governments
sovereign within the State.36 Administrative autonomy may involve devolution of powers, but subject
to limitations like following national policies or standards,37 and those provided by the Local
Government Code, as the structuring of local governments and the allocation of powers,
responsibilities, and resources among the different local government units and local officials have
been placed by the Constitution in the hands of Congress 38 under Section 3, Article X of the
Constitution.
Section 3, Article X of the Constitution mandated Congress to "enact a local government code which
shall provide for a more responsive and accountable local government structure instituted through
a system of decentralization with effective mechanisms of recall, initiative, and referendum, allocate
among the different local government units their powers, responsibilities, and resources, and provide
for the qualifications, election, appointment and removal, term, salaries, powers and functions and
duties of local officials, and all other matters relating to the organization and operation of the local
units."
In connection with the enforcement of the small-scale mining law in the province, Section 17 of the
Local Government Code provides:
SEC. 17. Basic Services and Facilities. - (a) Local government units shall endeavor to be self-reliant
and shall continue exercising the powers and discharging the duties and functions currently vested
upon them. They shall also discharge the functions and responsibilities of national agencies and
offices devolved to them pursuant to this Code. Local government units shall likewise exercise such
other powers and discharge such other functions and responsibilities as are necessary, appropriate,
or incidental to efficient and effective provision of the basic services and facilities enumerated herein.
(b) Such basic services and facilities include, but are not limited to, the following:
xxxx
(3) For a Province:c
xxxx
 22

(iii) Pursuant to national policies and subject to supervision, control and review of the DENR,
enforcement of forestry laws limited to community-based forestry projects, pollution control law,
small-scale mining law, and other laws on the protection of the environment; and mini-hydro electric
projects for local purposes;39
Clearly, the Local Government Code did not fully devolve the enforcement of the small-scale mining
law to the provincial government, as its enforcement is subject to the supervision, control and review
of the DENR, which is in charge, subject to law and higher authority, of carrying out the State's
constitutional mandate to control and supervise the exploration, development, utilization of the
country's natural resources.40
Section 17 (b)(3)(iii) of the Local Government Code of 1991 is in harmony with R.A. No. 7076 or the
People's Small-Scale Mining Act of 1991,41 which established a People's Small-Scale Mining
Program to be implemented by the Secretary of the DENR, thus:
Sec. 2. Declaration of Policy. – It is hereby declared of the State to promote, develop, protect and
rationalize viable small-scale mining activities in order to generate more employment opportunities
and provide an equitable sharing of the nation's wealth and natural resources, giving due regard to
existing rights as herein provided.
xxxx
Sec. 4. People's Small-Scale Mining Program. - For the purpose of carrying out the declared policy
provided in Section 2 hereof, there is hereby established a People's Small-Scale Mining Program to
be implemented by the Secretary of the Department of Environment and Natural Resources,
hereinafter called the Department, in coordination with other concerned government agencies,
designed to achieve an orderly, systematic and rational scheme for the small-scale development
and utilization of mineral resources in certain mineral areas in order to address the social, economic,
technical, and environmental problems connected with small-scale mining activities.
xxxx
Sec. 24. Provincial/City Mining Regulatory Board. – There is hereby created under the direct
supervision and control of the Secretary a provincial/city mining regulatory board, herein called the
Board, which shall be the implementing agency of the Department, and shall exercise the following
powers and functions, subject to review by the Secretary:
(a) Declare and segregate existing gold-rush areas for small-scale mining;
(b) Reserve future gold and other mining areas for small-scale mining;
(c) Award contracts to small-scale miners;
(d) Formulate and implement rules and regulations related to small-scale mining;
(e) Settle disputes, conflicts or litigations over conflicting claims within a people’s small-scale mining
area, an area that is declared a small-mining; and
(f) Perform such other functions as may be necessary to achieve the goals and objectives of this
Act.42
DENR Administrative Order No. 34, series of 1992, containing the Rules and Regulations to
implement R.A. No. 7076, provides:
SEC. 21. Administrative Supervision over the People's Small-Scale Mining Program. − The following
DENR officials shall exercise the following supervisory functions in the implementation of the
Program:
21.1 DENR Secretrary – direct supervision and control over the program and activities of the small-
scale miners within the people's small-scale mining area;
 23

21.2 Director − the Director shall:

a. Recommend the depth or length of the tunnel or adit taking into account the: (1) size of
membership and capitalization of the cooperative; (2) size of mineralized areas; (3) quantity of
mineral deposits; (4) safety of miners; and (5) environmental impact and other considerations;
b. Determine the right of small-scale miners to existing facilities in consultation with the operator,
claimowner, landowner or lessor of an affected area upon declaration of a small-scale mining area;
c. Recommend to the Secretary the withdrawal of the status of the people's small-scale mining area
when it can no longer be feasibly operated on a small-scale basis; and
d. See to it that the small-scale mining contractors abide by small-scale mines safety rules and
regulations.
xxxx
SEC. 22. Provincial/City Mining Regulatory Board. − The Provincial/City Mining Regulatory Board
created under R.A. 7076 shall exercise the following powers and functions, subject to review by the
Secretary:
22.1 Declares and segregates existing gold rush area for small-scale mining;
22.2 Reserves for the future, mineralized areas/mineral lands for people's small-scale mining;
22.3 Awards contracts to small-scale miners’ cooperative;
22.4 Formulates and implements rules and regulations related to R.A. 7076;
22.5 Settles disputes, conflicts or litigations over conflicting claims within ninety (90) days upon filing
of protests or complaints; Provided, That any aggrieved party may appeal within five (5) days from
the Board's decision to the Secretary for final resolution otherwise the same is considered final and
executory; and
22.6 Performs such other functions as may be necessary to achieve the goals and objectives of
R.A. 7076.
SEC. 6. Declaration of People's Small-Scale Mining Areas. – The Board created under R.A. 7076
shall have the authority to declare and set aside People's Small-Scale Mining Areas in sites onshore
suitable for small-scale mining operations subject to review by the DENR Secretary thru the
Director.43
DENR Administrative Order No. 23, otherwise known as the Implementing Rules and Regulations
of R.A. No. 7942, otherwise known as the Philippine Mining Act of 1995, adopted on August 15,
1995, provides under Section 12344 thereof that small-scale mining applications should be filed with
the PMRB45 and the corresponding permits shall be issued by the Provincial Governor, except small-
scale mining applications within the mineral reservations.
Thereafter, DENR Administrative Order No. 96-40, otherwise known as the Revised Implementing
Rules and Regulations of R.A. No. 7942, otherwise known as the Philippine Mining Act of 1995,
adopted on December 19, 1996, provides that applications for Small-Scale Mining Permits shall be
filed with the Provincial Governor/City Mayor through the concerned Provincial/City Mining
Regulatory Board for areas outside the Mineral Reservations and with the Director though the
Bureau for areas within the Mineral Reservations.46 Moreover, it provides that Local Government
Units shall, in coordination with the Bureau/ Regional Offices and subject to valid and existing mining
rights, "approve applications for small-scale mining, sand and gravel, quarry x x x and gravel permits
not exceeding five (5) hectares."47
Petitioner contends that the Local Government Code of 1991, R.A. No. 7076, DENR Administrative
Orders Nos. 95-23 and 96-40 granted the DENR Secretary the broad statutory power of control, but
 24

did not confer upon the respondents 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.
The contention does not persuade.
The settlement of disputes over conflicting claims in small-scale mining is provided for in Section 24
of R.A. No. 7076, thus:
Sec. 24. Provincial/City Mining Regulatory Board. − There is hereby created under the direct
supervision and control of the Secretary a provincial/city mining regulatory board, herein called the
Board, which shall be the implementing agency of the Department, and shall exercise the following
powers and functions, subject to review by the Secretary:
xxxx
(e) Settle disputes, conflicts or litigations over conflicting claims within a people's small-scale mining
area, an area that is declared a small mining area; x x x
Section 24, paragraph (e) of R.A. No. 7076 cited above is reflected in Section 22, paragraph 22.5
of the Implementing Rules and Regulations of R.A. No. 7076, to wit:
SEC. 22. Provincial/City Mining Regulatory Board. – The Provincial/City Mining Regulatory Board
created under R.A. No. 7076 shall exercise the following powers and functions, subject to review by
the Secretary:
xxxx
22.5 Settles disputes, conflicts or litigations over conflicting claims within ninety (90) days upon filing
of protests or complaints; Provided, That any aggrieved party may appeal within five (5) days from
the Board's decision to the Secretary for final resolution otherwise the same is considered final and
executory; x x x
In this case, in accordance with Section 22, paragraph 22.5 of the Implementing Rules and
Regulations of R.A. No. 7076, the AMTC filed on July 22, 2005 with the PMRB of Bulacan a formal
protest against the Applications for Quarry Permits of Eduardo Mercado, Benedicto Cruz, Liberato
Sembrano (replaced by Lucila Valdez) and Gerardo Cruz on the ground that the subject area was
already covered by its Application for Exploration Permit.48 However, on August 8, 2005, the PMRB
issued Resolution Nos. 05-8, 05-9, 05-10 and 05-11, resolving to submit to the Provincial Governor
of Bulacan the Applications for Small-Scale Mining Permits of Eduardo Mercado, Benedicto Cruz,
Lucila Valdez and Gerardo Cruz for the granting/issuance of the said permits.49 On August 10, 2005,
the Provincial Governor of Bulacan issued the Small-Scale Mining Permits to Eduardo Mercado,
Benedicto Cruz, Lucila Valdez and Gerardo Cruz based on the legal opinion of the Provincial Legal
Officer and the Resolutions of the PMRB of Bulacan.
Hence, AMTC filed an appeal with respondent DENR Secretary, appealing from Letter-Resolution
No. 05-1317 and Resolution Nos. 05-08, 05-09, 05-10 and 05-11, all dated August 8, 2005, of the
PMRB of Bulacan, which resolutions gave due course and granted, on August 10, 2005, Small-
Scale Mining Permits to Eduardo D. Mercado, Benedicto S. Cruz, Lucila Valdez and Gerardo Cruz
involving parcels of mineral land situated at Camachin, Doña Remedios Trinidad, Bulacan.
The PMRB of Bulacan filed its Answer, stating that it is an administrative body, created under R.A.
No. 7076, which cannot be equated with the court wherein a full-blown hearing could be conducted,
but it is enough that the parties were given the opportunity to present evidence. It asserted that the
questioned resolutions it issued were in accordance with the mining laws and that the Small-Scale
Mining Permits granted were registered ahead of AMTC's Application for Exploration Permit.
Further, the Board stated that the Governor of Bulacan had the power to approve the Small-Scale
Mining Permits under R.A. No. 7160.
 25

The DENR Secretary found the appeal meritorious, and resolved these pivotal issues: (1) when is
the subject mining area open for mining location by other applicants; and (2) who among the
applicants have valid applications.1âwphi1 The pertinent portion of the decision of the DENR
Secretary reads:
We agree with the ruling of the MGB Director that the area is open only to mining location on August
11, 2004, fifteen (15) days after the receipt by Golden Falcon on July 27, 2004 of a copy of the
subject Order of July 16, 2004.1âwphi1 The filing by Golden Falcon of the letter-appeal suspended
the finality of the Order of Denial issued on April 29, 1998 by the Regional Director until the
Resolution thereof on July 16, 2004.
Although the subject AQPs/SSMPs were processed in accordance with the procedures of the
PMRB, however, the AQPs were filed on February 10, 2004 when the area is still closed to mining
location. Consequently, the SSMPs granted by the PMRB and the Governor are null and void
making thereby AEP No. III-02-04 of the AMTC valid, it having been filed when the area is already
open to other mining applicants.
Records also show that the AQPs were converted into SSMPs. These are two (2) different
applications. The questioned SSMPs were issued in violation of Section 4 of RA 7076 and beyond
the authority of the Provincial Governor pursuant to Section 43 of RA 7942 because the area was
never proclaimed as "People's Small-Scale Mining Program." Moreover, iron ore mineral is not
considered among the quarry resources.
xxxx
WHEREFORE, the Application for Exploration Permit, AEP-III-02-04 of Atlantic Mines and Trading
Corp. is declared valid and may now be given due course. The Small-Scale Mining Permits, SSMP-
B-002-05 of Gerardo Cruz, SSMP-B-003-05 of Eduardo D. Mercado, SSMP-B-004-05 of Benedicto
S. Cruz and SSMP-B-005-05 of Lucila S. Valdez are declared NULL AND VOID. Consequently, the
said permits are hereby CANCELLED.50
The Court finds that the decision of the DENR Secretary was rendered in accordance with the power
of review granted to the DENR Secretary in the resolution of disputes, which is provided for in
Section 24 of R.A. No. 707651 and Section 22 of its Implementing Rules and Regulations.52 It is
noted that although AMTC filed a protest with the PMRB regarding its superior and prior Application
for Exploration Permit over the Applications for Quarry Permit, which were converted to Small-Scale
Mining Permits, the PMRB did not resolve the same, but issued Resolution Nos. 05-08 to 05-11 on
August 8, 2005, resolving to submit to the Provincial Governor of Bulacan the Applications for Small-
Scale Mining Permits of Eduardo Mercado, Benedicto Cruz, Lucila Valdez and Gerardo Cruz for the
granting of the said permits. After the Provincial Governor of Bulacan issued the Small-Scale Mining
Permits on August 10, 2005, AMTC appealed the Resolutions of the PMRB giving due course to the
granting of the Small-Scale Mining Permits by the Provincial Governor.
Hence, the decision of the DENR Secretary, declaring that the Application for Exploration Permit of
AMTC was valid and may be given due course, and canceling the Small-Scale Mining Permits
issued by the Provincial Governor, emanated from the power of review granted to the DENR
Secretary under R.A. No. 7076 and its Implementing Rules and Regulations. The DENR Secretary's
power to review and, therefore, decide, in this case, the issue on the validity of the issuance of the
Small-Scale Mining Permits by the Provincial Governor as recommended by the PMRB, 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. 53 The DENR Secretary exercises quasi-
judicial function under R.A. No. 7076 and its Implementing Rules and Regulations to the extent
necessary in settling disputes, conflicts or litigations over conflicting claims. This quasi-judicial
function of the DENR Secretary 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
 26

Provincial Governor as it is a determination of the rights of AMTC over conflicting claims based on
the law.
In determining whether Section 17 (b)(3)(iii) of the Local Government Code of 1991 and Section 24
of R.A. No. 7076 are unconstitutional, the Court has been guided by Beltran v. The Secretary of
Health, 54 which held:
The fundamental criterion is that all reasonable doubts should be resolved in favor of the
constitutionality of a statute. 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. Those who petition this Court to
declare a law, or parts thereof, unconstitutional must clearly establish the basis therefor. Otherwise,
the petition must fail. 55
In this case, the Court finds that the grounds raised by petitioner to challenge the constitutionality of
Section 17 (b )(3)(iii) of the Local Government Code of 1991 and Section 24 'of R.A. No.7076 failed
to overcome the constitutionality of the said provisions of law.
WHEREFORE, the petition is DISMISSED for lack of merit.
No costs.
SO ORDERED.
DIOSDADO M. PERALTA
Associate Justice
 27

G.R. No. 197115

REPUBLIC OF THE PHILIPPINES, represented by the Secretary of Agriculture, Petitioner,
vs.
FEDERICO DACLAN, JOSEFINA COLLADO and her husband FEDERICO DACLAN,
TEODORO DACLAN and MINVILUZ DACLAN as surviving heirs of deceased JOSE
DACLAN, Respondents.
x-----------------------x
G.R. No. 197267
FEDERICO DACLAN, JOSEFINA COLLADO, TEODORO DACLAN and MINVILUZ DACLAN as
surviving heirs of deceased JOSE DACLAN, Petitioners,
vs.
REPUBLIC OF THE PHILIPPINES, and represented by the Secretary of Agriculture and
PROVINCE OF LA UNION, represented by its PROVINCIAL GOVERNOR, Respondents.
DECISION
DEL CASTILLO, J.:
Before us are consolidated Petitions for Review on Certiorari1 assailing 1) the January 25, 2011
Decision2 of the Court of Appeals (CA) in CA-G.R. CV No. 90014 which set aside the July 31, 2007
Decision3 of Branch 32 of the Regional Trial Court (RTC) of Agoo, La Union, as well as 2) the CA’s
May 30, 2011 Resolution4 denying the parties’ respective Motions for Reconsideration.5
Factual Antecedents
The facts, as found by the CA, are as follows:
Sometime in May 1972, the Agoo Breeding Station (or "breeding station") was established by the
Department of Agriculture, through the Bureau of Animal Industry (BAI), Region I, for the purpose
of breeding cattle that would be distributed to the intended beneficiaries pursuant to the livelihood
program of the national government. In support of the said project, plaintiffs 6 executed four (4)
documents denominated as Deed of Donation in favor of defendant Republic of the Philippines (or
"Republic") donating to the latter four (4) parcels of land, more particularly described in the following
Tax Declarations (TD):
1.TD No. 23769 registered in the name of Federico Daclan covering a [parcel of] land with an area
of 15,170 square meters, more or less;
2.TD No. 38240 registered in the name of Josefina Collado covering a [parcel of] land with an area
of 3,440 square meters, more or less;
3.TD No. 27220 registered in the name of Teodoro Daclan covering a [parcel of] land with an area
of 2,464 square meters, more or less;
4.TD No. 1875 registered in the name of Jose Daclan (deceased father of plaintiff Minviluz Daclan)
covering a [parcel of] land with an area of 1,769 square meters, more or less.
These parcels of land are located at Barrio Nazareno, Agoo, La Union. The donation was subject to
the conditions that these parcels of land 1) shall be used solely for the establishment of a breeding
station, and 2) shall not be used for any other purpose, except with the previous consent of the
donors or their heirs.
Sometime in 1991, the powers and functions of certain government agencies, including those of the
Department of Agriculture (DA), were devolved to the local government units pursuant to Republic
Act No. 7160, otherwise known as the "Local Government Code". Thus, defendant Province of La
 28

Union (or "Province") assumed the powers and functions of the DA, in the operation of the breeding
station.7
In particular, the deeds of donation8 stipulated –
a.That the land herein mentioned shall be used for the establishment of a breeding station and shall
not be used for any other purpose, except with the previous consent of the DONOR or his heirs;
xxxx
c.That in case of non-use, abandonment or cessation of the activities of the BUREAU OF ANIMAL
INDUSTRY, possession or ownership shall automatically revert to the DONOR and all permanent
improvements existing thereon shall become the property of the DONOR; x x x9
All in all, the petitioners in G.R. No. 197267 – Federico Daclan, Josefina Collado, Teodoro Daclan,
Jose Daclan (the Daclans) – and several others donated around 13 hectares of land to the Republic.
The uniform deeds of donation covering these parcels of land contained the same conditions,
including the above stipulations relative to exclusive purpose/use and automatic reversion.10
Sometime after the donations were made, the La Union Medical Center (LUMC) was constructed
on a 1.5-hectare portion of the 13-hectare donated property.11
In a September 4, 2003 Letter12 to the Secretary of the Department of Agriculture, the Daclans and
other donors demanded the return of their donated lands on the ground that the breeding station
has ceased operations and that the land has been abandoned.
Ruling of the Regional Trial Court
On March 28, 2005, the Daclans filed Civil Case No. A-2363 for specific performance against the
Republic and the Province of La Union. The case was assigned to Branch 32 of the RTC of Agoo,
La Union (Agoo RTC). The Daclans essentially claimed in their Amended Complaint 13 that pursuant
to the automatic reversion clause in the deeds of donation, they are entitled to a return of their
donated parcels of land after the Bureau of Animal Industry (BAI) ceased operating the breeding
station, but that the Republic and the Province failed to honor the said clause and refused to return
their land. They thus prayed that the defendants be ordered to return to them the donated land, with
all improvements existing thereon.
In its Answer,14 the Province alleged that the Daclans have no cause of action since the breeding
station was still existing – although this time it is being operated by the Province, pursuant to the
devolution program under the Local Government Code of 1991, and that the Daclans violated the
deeds of donation because they have occupied the donated land and have begun fencing the same.
It prayed for the dismissal of the complaint as well as the grant of injunctive relief.
In a subsequent Manifestation,15 the Republic opted to adopt the above Answer filed by the
Province.
In their Reply,16 the Daclans claimed that the donated land cannot be assigned by the Republic to
the Province as the deeds of donation did not include the Republic’s successors or assigns as
intended beneficiaries; that contrary to the Province’s claim, the breeding station is not operational
and has been abandoned, and the existing heads of cattle found therein do not belong to the
government but to former officials of the BAI; and that with the automatic reversion clause, they are
granted the immediate right to occupy the subject land, and no injunctive relief should issue against
them.
Upon motion of the parties, an ocular inspection of the premises was conducted, and a
Commissioner’s Report17 was prepared and issued thereafter. The report indicated in part that –
From information gathered from Ms. Cresencia Isibido, a caretaker of the Agoo Breeding Station,
the land had an original area of thirteen (13) hectares. At present though, only eleven point five
 29

(11.5) hectares is [sic] being occupied by the Agoo Breeding Station as 1.5 hectares was [sic]
occupied by the La Union Medical Center.
At a distance of about 200 meters from the main entrance of the breeding station, an office is located
at the south of said lot. Beside the office is a shed where six (6) young goats (kids) are housed.
Another shed where goats are housed is located at the northern side of the lot, fronting a water
pump station.
It was likewise gathered that at present, the breeding station has a total number of fifty (50) goats.
Also, there are six (6) cows roaming in the pasture land. Four (4) of these cows are pregnant. It was
clarified that these cows belong to the Cross Australian Bi-Bhraman [sic] breed.
There are four (4) caretakers in the breeding station, all of whom are employed by the provincial
government of La Union. They receive salary from the provincial government and they likewise
submit monthly reports to the Provincial Veterinarian. These four caretakers are Cresencia Isibido,
Manuel Daclan, Ruben Daclan (son of plaintiff Federico Daclan), and Tita Fortes.
The group left the breeding station at around 3:30pm.
Agoo, La Union, this 14th day of December, 2006.18
During trial, the witnesses testified as follows:
To substantiate their claim, the plaintiffs presented the following witnesses whose testimonies are
summarized, thus:
REINERIO BELARMINO[,] JR., is 46 years old, married, a resident of Namnama, San Fernando, La
Union, and Regional Director of the Department of Agriculture, Region 1.
Dir. Belarmino testified that by virtue of a subpoena ad testificandum and subpoena duces tecum,
he brought to Court a photocopy of a letter he issued to Atty. Benjamin Tabios, Legal Consultant of
the Department of Agriculture dated October 14, 2003.
Dir. Belarmino said that while he confirmed and affirmed the contents of the letter, he nevertheless
could not agree on [sic] one sentence written therein. This pertains to the entry that the artificial
breeding station is no longer operational. He explained that although he signed the letter, it was his
legal officer who prepared the same.
Further, he said that he had been calling his legal officer since it was the latter who drafted said
letter. He clarified that upon personal verification, he found out that it was not the artificial breeding
station that was not [operational]. Rather, it was the breeding station that was not operational.
He likewise mentioned that as early as 1993, the Department of Agriculture, particularly the Bureau
of Animal Industry, gave up the breeding station because of the devolution. In particular, the
operation of the breeding station was transferred to the Province of La Union. However, he affirmed
that in the deed of donation, there is no mention of the Province of La Union. Likewise, there is no
mention of any successor.
He clarified though that no breeding activity was done by the Department of Agriculture through the
Bureau of Animal Industry since 1993 because ownership of the breeding station was transferred to
the Province of La Union. The transfer was made without the consent of the donors since the transfer
was between two government entities.
On the ocular inspection which was conducted, Dir. Belarmino affirmed that at present, there are six
cows and fifty (50) goats in the breeding station. However, he clarified that said 50 goats are not the
same goats that were turned over to the province of La Union as a result of the devolution.
TEODORO DACLAN, 84 years old, married, retired government employee and a resident of
Nazareno, Agoo, La Union, testified that he is one of the plaintiffs in this case.
 30

He said that he executed a Deed of Donation in favor of the Republic of the Philippines, then
represented by the Secretary of the Department of Agriculture. He clarified that as embodied in their
complaint, they seek to enforce the common provision that in case of non-use, abandonment or
cessation of activities of the Bureau of Animal Industry, possession and ownership of the lots subject
of donation shall revert x x x to the donors.
In this respect, he said that the Department of Agriculture, through the Bureau of Animal Industry,
has no on-going breeding activity in the above- mentioned lots. He maintained that he came to know
of such non-operation of the breeding station as early as thirteen (13) years ago.
He likewise testified that he was never informed of any devolution which transferred the operations
of the breeding station from the Bureau of Animal Industry to the Province of La Union. Moreover,
his permission was never sought for the use of the donated lots by the Province of La Union.
FEDERICO DACLAN, 83 years old, married, retired employee of the Bureau of Animal Industry and
a resident of Brgy. Nazareno, Agoo, La Union, also testified.
He said that he is one of the plaintiffs in this case. Plaintiff Teodoro Daclan is his brother while
plaintiff Minviluz Daclan is his niece. His spouse, Josefina Collado, is likewise a co-plaintiff.
He added that he donated a parcel of land with an area of 15,170 square meters located at
Nazareno, Agoo, La Union in favor of the Republic of the Philippines through the Secretary of
Agriculture.
Further, he reiterated that as embodied in the deed of donation, one of the conditions therein is that
the land shall be used as a breeding station and shall not be used for any other purpose, except
with the previous consent of the donor or his heirs.
He maintained that since 1993 up to the present, the lot is no longer being used as a breeding
station nor has the defendant province of La Union sought his permission for the use of said lot for
any other purpose.
JOSEFINA COLLADO, 72 years old, married, housewife and a resident of Nazareno, Agoo, La
Union testified that she and her husband donated a parcel of land situated at Nazareno, Agoo, La
Union in favor of the Republic of the Philippines through the Secretary of Agriculture.
She said that at present, there is no breeding activity being conducted on said lot. She added that
there has been no breeding activity for a long time now. Further, she clarified that she and the other
plaintiffs were never notified of a devolution so much so that the operation of the breeding station
was transferred to defendant Province of La Union. Also, the defendant Province of La Union never
secured their consent for the use of the lot for any other purpose other than a breeding station.
MINVILUZ DACLAN, 75 years old, single, retired teacher and resident of San Pedro, Agoo, La Union
testified that she is the [daughter] of the late Jose Daclan. She said that during the lifetime of her
father, she was aware of a Deed of Donation executed by her father in favor of the Republic of the
Philippines represented by the then Secretary of Agriculture.
She said that the lot subject of the donation is situated in Nazareno, Agoo, La Union. Likewise, she
testified that the donation was premised on the condition that a breeding station is to be established
in said property. However, she maintained that there is no such breeding station.
Further, she was not aware if her father gave his consent for the use of the property for any other
purpose other than for a breeding station. She emphasized that her father gave his consent only for
the use of a breeding station. Likewise, she has not been consulted nor her permission sought for if
the land can be used for any other purpose other than for breeding.
The defendant Province of La Union presented the following witnesses whose testimonies are
summarized, thus:
 31

CRESENCIA ISIBIDO, 58 years old, single, government employee and a resident of San Pedro,
Agoo, La Union testified that she is employed at the Office of the Veterinarian, particularly at the
Agoo Breeding Station at Nazareno, Agoo, La Union.
Particularly, she has been employed thereat since August 28, 1974, initially as Farm Worker and
now, as Farm Foreman. As foreman, she exercises supervision over her co-employees and over all
animals in the breeding station. She clarified that in 1989, there were six (6) personnel assigned at
the breeding station. She likewise clarified that from 1974 until 1989, she received her salary from
the Bureau of Animal Industry.
During the devolution of 1993, she started receiving her salary from the provincial government of La
Union. She added though that even after devolution took place, the operation of the Agoo Breeding
Station continued.
Likewise, she testified that from the time she was promoted as farm foreman, goats, cattle and swine
were being maintained at the breeding station. She recalled that there were about twenty (20) cattle,
seventy (70) goats and eight (8) swine.
When the devolution took place, she specified that the activities in the breeding station included
production of animals, forage and artificial insemination. She said that the cattles in the breeding
station were either subjected to natural insemination or artificial insemination. Upon the other hand,
goats are subjected to natural insemination. Aside from artificial or natural insemination, greasing is
also being conducted in the breeding station.
DR. NIDA GAPUZ, 47 years old, married, Provincial Veterinarian and a resident of Bauang, La
Union testified that she is the provincial veterinarian of the province of La Union since October,
2006. Prior to her appointment as provincial veterinarian, she was the Supervisor Agriculturist of the
Provincial Veterinarian’s Office. Again, prior to her appointment as supervisor agriculturist, she was
Agricultural Center Chief II of the same office.
She recalled that in 1983, their office was under the Department of Agriculture Regional Office.
Thereafter, they were transferred to the Provincial Office of the Department of Agriculture. She said
that at that time, the Agoo Breeding Station was already existing.
Thereafter, with the advent of devolution, the Office of the Provincial Veterinarian was created and
eventually, they were separated from the Department of Agriculture.
Further, she testified that in her capacity as Agricultural Center Chief II, she handled the facilities for
the Agoo Breeding Station and the La Union Breeding Station, both of which are under the office of
the provincial veterinarian.
She mentioned that she used to visit the Agoo Breeding Station at least two (2) times a month. She
added that natural as well as artificial insemination activities were conducted in said breeding station.
As such, she explained that one of the purpose[s] of the breeding station is to reproduce and
disperse animals.
At present, she said that the breeding station engages in goat dispersal and cattle production. There
are no swine since swine production was phased out because of the establishment of the La Union
Medical Center within the vicinity of the breeding station.
Likewise, she said that at present, there are seven (7) heads of cattle being raised in the breeding
station. Of these, two (2) are pregnant. There are also forty-six (46) heads of goats.
ATTY. MAURO CABADING, 53 years old, married, Provincial Assessor and a resident of San
Fernando City, La Union testified that he is familiar with the Agoo Breeding Station because he took
photographs thereof sometime last year.
He explained that he was directed by the governor and the provincial administrator to take
photographs of the breeding station to determine whether the allegations contained in the complaint
 32

filed by herein plaintiffs [are] true or not. He then proceeded to the Agoo Breeding Station
accompanied by his driver and a personnel from the Provincial Veterinarian’s Office.
He maintained that he can recognize the photographs taken at the breeding station since it was his
camera that was used in taking pictures. He then started identifying the photographs, making
mention of those which depicted cows, goats and houses for cows and goats. Also, he said that the
[owner] of the goats and cows seen at the photographs he took is the provincial government of La
Union.19
On July 31, 2007, the Agoo RTC rendered its Decision 20 in Civil Case No. A-2363, which decreed
thus:
WHEREFORE, in view of the foregoing, the Court hereby renders judgment DISMISSING this
instant case for specific performance.
SO ORDERED.21
The trial court held that although the functions and powers of the BAI were transferred to the
Province by virtue of devolution under the Local Government Code of 1991, the Province continued
to operate the breeding station. It added that the Daclans’ consent to the transfer of functions and
powers was not necessary as to affect the validity of the donations of their lands; devolution of power
took effect by operation of law. It held further that contrary to the Daclans’ claims, the preponderance
of evidence suggested that the operations of the breeding station never ceased; and there are farm
animals, buildings, structures, and offices being supervised by four caretakers whose salaries were
being paid by the Province, and these personnel submit monthly reports of operations to the
provincial veterinarian.
Ruling of the Court of Appeals
The Daclans took the Agoo RTC’s July 31, 2007 Decision to the CA via appeal. On January 25,
2011, the CA issued the assailed Decision, decreeing as follows:
WHEREFORE, in view of all the foregoing, the assailed July 31, 2007 decision of Branch 32 of the
Regional Trial Court of Agoo, La Union is hereby SET ASIDE. The donation insofar as the 1.5
hectare portion of the donated parcels of land that is now being used by the La Union Medical Center
for its medical facility, hence no longer being used for the purpose for which the donation was
constituted, is hereby declared revoked. Accordingly, possession and ownership of that particular
portion of the donated parcels of land shall revert to the donor/s or their heir/s.
SO ORDERED.22
In essence, the CA agreed with the findings of fact of the Agoo RTC, except that it held that the
Province violated the exclusive use stipulations in the deeds of donation when it allowed the
construction of the LUMC within a portion of the donated lands, as the operation of a human medical
facility has no relation to the operation of an animal breeding station, and it has not been shown that
the consent of the donors was obtained prior to the construction of the LUMC. Thus, with respect to
the portion occupied by the LUMC, the automatic reversion clauses in the deeds of donation apply.
The appellate court held further that even the Office of the Solicitor General conceded that if any
violation of the deeds of donation occurred, it could only affect that portion which is no longer used
as a breeding station. Finally, it upheld the validity of the automatic reversion clauses in the subject
deeds of donation, which it found to be consistent with law, morals, good customs, public order and
public policy.
Both the Daclans and the Republic moved for reconsideration, but on May 30, 2011, the CA issued
the second assailed disposition sustaining its judgment.
The present Petitions were thus filed.
In an October 3, 2011 Resolution23 of the Court, both Petitions were ordered consolidated.
 33

Issues
The following issues are raised:
By the Republic in G.R. No. 197115
I.
THE HONORABLE COURT ERRED IN RULING THAT PETITIONER VIOLATED THE
PROVISIONS OF THE DEEDS OF DONATION.
II.
THE HONORABLE COURT OF APPEALS ERRED IN DIRECTING THE PETITIONER TO
RETURN PORTION/S OF THE PARCEL/S OF LAND DONATED BY RESPONDENTS AND/OR
THEIR FOREBEARS BASED ON AN UNESTABLISHED INFERENCE.24
By the Daclans in G.R. No. 197267
A.
THE HONORABLE COURT OF APPEALS DID NOT DECIDE THE MAIN ISSUES RAISED BY THE
PETITIONERS IN THE TRIAL COURT AND BEFORE IT.
B.
THE HONORABLE COURT OF APPEALS HAS DECIDED A QUESTION OF SUBSTANCE IN A
WAY NOT IN ACCORD WITH THE ESTABLISHED FACTS AND THE APPLICABLE LAWS AND
JURISPRUDENCE.25
The Parties’ Respective Arguments
G.R. No. 197115. For the Republic, the lone point of contention is that the CA could not validly order
the return to the Daclans of the donated 1.5-hectare portion where the LUMC is situated because it
has not been proved that such portion formed part of lands originally donated by the Daclans. The
Republic contends that the Daclans donated only an aggregate of 2.2843 hectares, while the
breeding station sits on 13 hectares of donated land; the Daclans did not prove during trial that the
1.5-hectare land where the LUMC is erected sits within the 2.2843 hectares donated by them. It
maintains that if reversion must occur, the Daclans must first clearly identify the land on which the
LUMC is erected as theirs. Thus, it prays that the July 31, 2007 Decision of the Agoo RTC be
reinstated.
For their part, the Daclans adopt their Petition in G.R. No. 197267 as their Comment to the
Republic’s Petition. In turn, the Republic manifested that it was adopting its Comment 26 to the
Daclans’ Petition in G.R. No. 197267 as its Reply.
G.R. No. 197267. The Daclans in their Petition insist that the deeds of donation they executed are
"personal and exclusively limited to the parties, the donor and the donee. (They do) not extend to or
inure to the benefit of their successors and assigns;"27 the rights and obligations of the parties to the
donations are not transmissible by their nature or stipulation. Thus, the unauthorized turnover of the
breeding station to the Province by the BAI – the sole beneficiary under the deeds of donation –
constitutes a violation of the terms of the deeds of donation, thus giving ground for reversion; and
with the passage of the Local Government Code of 1991, the BAI ceased to exist and was abolished.
Thus, the donated lands automatically revert to their original owners. They add that the evidence
clearly indicates that the donated lands are no longer being used as a breeding station, but merely
grazing land for a few animals whose ownership is even in doubt. Finally, the Daclans decry the
failure of the Province to provide "agricultural extension and on-site research services and facilities"
as required under the Implementing Rules and Regulations of the Local Government Code of 1991,
which thus constitutes a violation of the stipulation contained in the deeds of donation to develop
 34

and improve the livestock industry of the country. Thus, they pray that the assailed CA dispositions
be set aside completely and all their donated lands be reverted to them.
Notably, the Daclans admit in their Petition that the 1.5-hectare portion where the LUMC is
constructed does not form part of the lands they donated to the government, but belongs to "other
donors who are not parties to the case."28
In its Comment29 with a prayer for the denial of the Daclans’ Petition and reinstatement of the July
31, 2007 Decision of the Agoo RTC, the Republic argues that the question of whether the breeding
station is still in operation is one of fact which should not be disturbed at this stage of the
proceedings; that the Daclans’ admission in their Petition that the 1.5-hectare portion where the
LUMC is constructed does not form part of the lands they donated to the government contradicts its
argument that the CA committed serious error in ordering the reversion of the said portion to them;
that it is not merely the BAI which acted as the donee, but the Republic itself – represented by the
Secretary of the Department of Agriculture – which is the recipient of the Daclans’ donated lands
under the deeds; and that the passage of the Local Government Code of 1991 did not result in the
cessation of operations of the Agoo breeding station.
In an August 28, 2013 Manifestation,30 the Province adopted the Republic’s Comment to the Petition
as its own.
Our Ruling
The Court grants the Republic’s Petition in G.R. No. 197115 and denies that of the Daclans’ in G.R.
No. 197267.
The preponderance of evidence points to the fact that the breeding station remained operational
even after its transfer from the Republic to the Province. The activities of the BAI did not cease even
after it was dissolved after the government adopted the policy of devolution under the Local
Government Code of 1991; these activities were merely transferred to the Province. Thus, the
witnesses for the Daclans and the Republic uniformly declared that the breeding station remained
operational even after the Local Government Code of 1991 was put into effect. Particularly, Regional
Director Reinerio Belarmino, Jr. of the Department of Agriculture, Region 1 declared that after the
breeding station was transferred to the Province, he saw upon ocular inspection that there remained
six cows and fifty goats on the premises. Cresencia Isibido testified that as Farm Foreman, she
exercised supervision over her co-employees in the breeding station; that in 1989, there were six
personnel assigned at the breeding station; that from 1974 until 1989, she received her salary from
the BAI; that after devolution, she started receiving her salary from the Province; and that even after
devolution, the operation of the Agoo Breeding Station continued, and goats, cattle and swine were
being maintained thereat. Dr. Nida Gapuz, La Union Provincial Veterinarian, said that natural as well
as artificial insemination activities were being conducted at the breeding station, as well as goat
dispersal and cattle production. Atty. Mauro Cabading, La Union Provincial Assessor, testified that
he was directed by the Governor and the Provincial Administrator to take photographs of the
breeding station in order to verify the complaint filed by the Daclans; that he then proceeded to the
Agoo Breeding Station; that he took photographs of the animals – cows and goats – therein; and
that the Province owned said animals at the breeding station.
As against the bare assertions of the Daclans that the breeding station was abandoned and became
non-operational, the testimonies of the above public officers are credible.1avvphi1 "In the absence
of any controverting evidence, the testimonies of public officers are given full faith and credence, as
they are presumed to have acted in the regular performance of their official duties." 31
Devolution cannot have any effect on the donations made by the Daclans to the Republic. As
defined, "devolution refers to the act by which the national government confers power and authority
upon the various local government units to perform specific functions and responsibilities." 32 It
includes "the transfer to local government units of the records, equipment, and other assets and
personnel of national agencies and offices corresponding to the devolved powers, functions and
 35

responsibilities."33 While the breeding station may have been transferred to the Province of La Union
by the Department of Agriculture as a consequence of devolution, it remained as such, and
continued to function as a breeding station; and the purpose for which the donations were made
remained and was carried out. Besides, the deeds of donation did not specifically prohibit the
subsequent transfer of the donated lands by the donee Republic. The Daclans should bear in mind
that "contracts take effect between the parties, their assigns and heirs, except in cases where the
rights and obligations arising from the contract are not transmissible by their nature, or by stipulation
or by provision of law."34 Thus, as a general rule, rights and obligations derived from contract are
transmissible.
The Daclans lament the supposed failure of the Province to provide "agricultural extension and on-
site research services and facilities" as required under the Implementing Rules and Regulations of
the Local Government Code of 1991, which failure they believe, constituted a violation of the
stipulation contained in the deeds of donation to develop and improve the livestock industry of the
country. Yet this cannot be made a ground for the reversion of the donated lands; on the contrary,
to allow such an argument would condone undue interference by private individuals in the operations
of government. The deeds of donation merely stipulated that the donated lands shall be used for
the establishment of a breeding station and shall not be used for any other purpose, and that in case
of non-use, abandonment or cessation of the activities of the BAI, possession or ownership shall
automatically revert to the Daclans. It was never stipulated that they may interfere in the
management and operation of the breeding station. Even then, they could not directly participate in
the operations of the breeding station.
Thus, even if the BAI ceased to exist or was abolished as an office, its activities continued when its
functions were devolved to the local government units such as the Province of La Union. It cannot
be said that the deeds of donation may be nullified just by the fact that the BAI became defunct; its
functions continued in the government offices/local government units to which said functions were
devolved.
Lastly, the CA cannot validly order the return to the Daclans of the donated 1.5-hectare portion
where the LUMC is situated, because such portion was not donated by them. They admitted that
the 1.5-hectare portion where the LUMC is constructed does not form part of the lands they donated
to the government, but belonged to other donors who are not parties to the instant case. As far as
the Daclans are concerned, whatever they donated remains part of the breeding station and so long
as it remains so, no right of reversion accrues to them. Only the original owner-donor of the 1.5-
hectare portion where the LUMC is constructed is entitled to its return.
WHEREFORE, the Court resolves as follows:
1. The January 25, 2011 Decision and May 30, 2011 Resolution of the Court of Appeals in CA-G.R
CV No. 90014 are REVERSED and SET ASIDE;
2.The Petition in G.R. No. 197115 is GRANTED. The July 31, 2007 Decision of the Regional Trial
Court of Agoo, La Union, Branch 32 dismissing Civil Case No. A-2363 is REINSTATED; and
3.The Petition in G.R. No. 197267 is DENIED.
SO ORDERED.
MARIANO C. DEL CASTILLO
Associate Justice

(To start printing case 62, Topic C)