104226, August 12, 1993 FACT: Petitioner Conchita Romualdez-Yap (a sister of Mrs. Imelda Romualdez Marcos) was the Senior Vice President of PNB - Fund Transfer Department. While she was on a medical leave from April 1986 up to 20 February 1987, EO No. 80 (Revised Charter of the PNB) was approved and the restructure/reorganization and rehabilitation of PNB was executed. Pursuant to the reorganization plan, the FTD was abolished and its functions transferred to the International Department. Mrs. Yap filed a complaint with Civil Service Commission. However, the CSC issued a resolution upholding that petitioner's separation from PNB was a result of the abolition of the FTD brought about by PNB’s reorganization. She assailed said CSC resolution and complained that the bank’s reorganization was done in bad faith. She believed that the reorganization was intended by the then new administration/management to ease her out of office, being the sister of Mrs. Imelda Marcos, widow of the then newly-deposed dictator. ISSUE: Whether there was an existence of bad faith in the reorganization of the Philippine National Bank resulting in the separation from the service of petitioner? HELD: The Court made a distinction in this ruling on the validity of reorganization between a government bureau or office performing constituent functions (like the Customs) and a governmentowned or controlled corporation performing ministrant functions (like the PNB). Constituent function are those which constitute the very bonds of society and are compulsory in nature; ministrant functions are those undertaken by way of advancing the general interests of society, and are merely optional. Commercial or universal banking is, ideally, not a governmental but a private sector, endeavor. It is an optional function of government. But a reorganization whether in a government bureau performing constituent functions or in a government-owned or controlled corporation performing ministrant functions must meet a common test, the test of good faith. The decision to abolish the Fund Transfer Department (FTD) was a business judgment made in good faith. Due to the restructuring, PNB became once more a viable banking institution. After four years, FTD was restored and its functions were transferred to the International Department. These can be attributed to the bank's growth after reorganizations, thereby negating malice or bad faith in that reorganization. While on leave from April 1986 to February 1987, petitioner continued receiving her salaries, allowances, honoraria and fees. Employees who were affected by the reorganization have opted to avail the bank’s separation payment, but not Mrs. Yap. She could have asserted her willingness to be employed once again after the reorganization, but records show she did nothing to that effect. Vigilantibus, non dormientibus, jura subveniunt (Laws come to the assistance of the vigilant, not of the sleeping). Read full text: Case Digest by: F.M.ORPILLA, SBC 1D (Group 1)

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