DBM Vs.

Manila’s Finest Retirees Association 169446 May 9, 2007

Facts
This case involves a petition for review on certiorari filed by the Department of Budget and
Management (DBM), Philippine National Police (PNP), National Police Commission
(NAPOLCOM), and Civil Service Commission (CSC) against the Manila's Finest Retirees
Association, Inc. (MFRAI) and other Integrated National Police (INP) retirees. In 1975,
Presidential Decree (P.D.) No. 765 was issued, constituting the INP composed of the Philippine
Constabulary (PC) and integrated police forces. In 1990, R.A. No. 6975 was enacted,
establishing the PNP and initially consisting of the members of the INP and the officers and
enlisted personnel of the PC. In 1998, R.A. No. 6975 was amended by R.A. No. 8551, which
reengineered the retirement scheme in the police organization and resulted in a disparity in
retirement benefits between INP retirees and PNP retirees. The INP retirees filed a petition for
declaratory relief in the Regional Trial Court (RTC) of Manila, seeking the same retirement
benefits as the PNP retirees. The RTC ruled in favor of the INP retirees, declaring them entitled
to the same retirement benefits under R.A. No. 6975, as amended. The DBM, PNP,
NAPOLCOM, and CSC appealed the decision to the Court of Appeals (CA), which affirmed the
RTC's decision. The CA denied the petitioners' motion for reconsideration, prompting them to
file a petition for review on certiorari with the Supreme Court.
Issue
The main issue raised in the case is whether the INP retirees are entitled to the same retirement
benefits as the PNP retirees under R.A. No. 6975, as amended.
Ruling
The Court ruled in favor of the INP retirees and held that they are entitled to the same retirement
benefits as the PNP retirees under R.A. No. 6975, as amended.
Ratio
The Court reasoned that the INP was not abolished but was merely transformed into the
Philippine National Police (PNP). Therefore, the INP retirees, as former members of the INP, are
considered PNP members and are entitled to the retirement benefits provided under the law. The
Court also rejected the petitioners' argument that NAPOLCOM Resolution No. 8 bars the
payment of any differential in retirement pay to officers and non-officers who retired prior to the
effectivity of Republic Act No. 6975. The Court held that the amendatory law, Republic Act No.
8551, explicitly states that the rationalized retirement benefits schedule and program "shall have
retroactive effect in favor of PNP members and officers retired or separated from the time
specified in the law." Therefore, the INP retirees, as former members of the INP, are entitled to
the retroactive application of the retirement benefits. The Court further emphasized that
retirement laws should be liberally construed in favor of the retiree, as retirement benefits are
considered rewards for past services rendered to the government.
Summary
The case involves a petition for review on certiorari filed by the DBM, PNP, NAPOLCOM, and
CSC against the MFRAI and other INP retirees. The main issue is whether the INP retirees are
entitled to the same retirement benefits as the PNP retirees under R.A. No. 6975, as amended.
The Court ruled in favor of the INP retirees and held that they are entitled to the same retirement
benefits as the PNP retirees. The Court reasoned that the INP was not abolished but was
transformed into the PNP, and therefore, the INP retirees are considered PNP members and are
entitled to the retirement benefits provided under the law. The Court also held that the retirement
benefits should have retroactive effect in favor of PNP members and officers retired or separated
from the time specified in the law. The Court emphasized that retirement laws should be liberally
construed in favor of the retiree.

Martelino Vs. NHMF Corp. 160208 June 30, 2008

Facts
This case involves a petition for declaratory relief and prohibition filed by Rafael R. Martelino
and other petitioners against the National Home Mortgage Finance Corporation (NHMFC) and
the Home Development Mutual Fund (HDMF). The petitioners obtained housing loans from the
respondents, who released the loan proceeds to the subdivision developer, Shelter Philippines,
Inc. However, Shelter failed to complete the subdivision according to its representations and the
subdivision plan. The petitioners were forced to spend their own resources to improve the
subdivision roads and alleys and install individual water facilities. The respondents failed to
ensure Shelter's completion of the subdivision and instead charged interests and penalties on the
outstanding loans, threatened to foreclose the mortgages, and initiated foreclosure proceedings
against Martelino.
Issue
The main issues raised in this case are the validity of the preliminary injunction order against the
HDMF and the propriety of dismissing the petition for declaratory relief and prohibition.
Ruling
The Supreme Court upheld the dismissal of the petition, ruling that the preliminary injunction
order was not valid against the HDMF because it was not notified of the hearing. The Court also
agreed with the lower courts that the petition for declaratory relief and prohibition was improper
because the subject matter of the petition, which involved the completion of the subdivision and
the imposition of interests and penalties on the housing loans, should have been brought before
the Housing and Land Use Regulatory Board (HLURB).
Ratio
The court ruled that the petition for declaratory relief and prohibition is improper. Prohibition is a
remedy against proceedings that are without or in excess of jurisdiction, or with grave abuse of
discretion, and there must be no appeal or other plain, speedy, adequate remedy in the ordinary
course of law. In this case, the petition did not impute lack of jurisdiction or grave abuse of
discretion committed by the respondents and Sheriff Castillo regarding the foreclosure
proceedings. Foreclosure of mortgage is the mortgagee's right in case of non-payment of a debt
secured by mortgage, and the HDMF cannot be faulted for exercising its right to foreclose the
mortgages under the provisions of Act No. 3135 as amended by Act No. 4118.
The court also noted that Republic Act No. 8501 allows condonation of loan penalties and grants
the HDMF the authority to condone or reduce the penalties imposed on housing loans. However,
the court emphasized that the petitioners failed to avail themselves of the benefits of Republic
Act No. 8501 by not submitting the necessary documents to the HDMF for the condonation of
loan penalties. Therefore, the court held that the petitioners cannot claim that the respondents
acted in bad faith or with undue haste in threatening them with foreclosures.
Furthermore, the court ruled that the issue of non-completion of the subdivision should have
been brought before the HLURB, which has jurisdiction over matters involving subdivision
development. The court explained that the HLURB has the power to regulate and supervise
subdivision development, including the imposition of penalties for non-compliance with
subdivision plans and specifications. Therefore, the court held that the petitioners should have
filed their complaint with the HLURB instead of seeking declaratory relief and prohibition from
the court.
Summary
In summary, the Supreme Court dismissed the petition for declaratory relief and prohibition filed
by the petitioners against the NHMFC and HDMF. The court ruled that the preliminary
injunction order was not valid against the HDMF because it was not notified of the hearing. The
court also held that the petition for declaratory relief and prohibition was improper because the
subject matter of the petition should have been brought before the HLURB. The court
emphasized that the foreclosure of mortgages is the mortgagee's right in case of non-payment of
a debt secured by mortgage, and the HDMF cannot be faulted for exercising its right to foreclose
the mortgages. The court further noted that the petitioners failed to avail themselves of the
benefits of Republic Act No. 8501 by not submitting the necessary documents for the
condonation of loan penalties. Therefore, the court upheld the dismissal of the petition.