ADMIN LAW CASE BANK W5.pdf

Admin Law | Case Bank Week 5 | Additional Cases for Chapters 3, 4 & 5


G.R. No.L45685

November 16, 1937

THE PEOPLE OF THE PHILIPPINE ISLANDS

and HONGKONG & SHANGHAI BANKING

CORPORATION,petitioners,

vs.

JOSE O. VERA, Judge . of the Court of First

Instance of Manila, and MARIANO CU UNJIENG,

respondents.

In 1934, Mariano Cu Unjieng was convicted in a

criminal case filed against him by the Hongkong

and Shanghai Banking Corporation (HSBC). In

1936, he filed for probation. The matter was

referred to the Insular Probation Office which

recommended the denial of Cu Unjieng's petition

for probation. A hearing was set by Judge Jose

Vera concerning the petition for probation. The

Prosecution opposed the petition. Eventually,

due to delays in the hearing, the Prosecution filed

a petition for certiorari with the Supreme Court

alleging that courts like the Court of First Instance

of Manila (which is presided over by Judge Vera)

have no jurisdiction to place accused like Cu

Unjieng under probation because under the law

(Act No. 4221 or The Probation Law), probation

is only meant to be applied in provinces with

probation officers; that the City of Manila is not a

province, and that Manila, even if construed as a

province, has no designated probation officer -

hence, a Manila court cannot grant probation.

Meanwhile, HSBC also filed its own comment on

the matter alleging that Act 4221 is

unconstitutional for it violates the constitutional

guarantee on equal protection of the laws. HSBC

averred that the said law makes it the prerogative

of provinces whether or nor to apply the probation

law - if a province chooses to apply the probation

law, then it will appoint a probation officer, but if it

will not, then no probation officer will be appointed

- hence, that makes it violative of the equal

protection clause.

Further, HSBC averred that the Probation Law is

an undue delegation of power because it gave the

option to the provincial board to whether or not to

apply the probation law - however, the legislature

did not provide guidelines to be followed by the

provincial board.

Further still, HSBC averred that the Probation

Law is an encroachment of the executive's power

to grant pardon. They say that the legislature, by

providing for a probation law, had in effect

encroached upon the executive's power to grant

pardon. (Ironically, the Prosecution agreed with

the issues raised by HSBC - ironic because their

main stance was the non-applicability of the

probation law only in Manila while recognizing its

application in provinces).

For his part, one of the issues raised by Cu

Unjieng is that, the Prosecution, representing the

State as well as the People of the Philippines,

cannot question the validity of a law, like Act

4221, which the State itself created. Further, Cu

Unjieng also castigated the fiscal of Manila who

himself had used the Probation Law in the past

without question but is now questioning the

validity of the said law (estoppel).

ISSUE:

1. May the State question its own laws?

2. Is Act 4221 constitutional?

HELD:

1. Yes. There is no law which prohibits the State,

or its duly authorized representative, from

questioning the validity of a law. Estoppel will also

not lie against the State even if it had been using

an invalid law.

2. No, Act 4221 or the [old] Probation Law is

unconstitutional.

Violation of the Equal Protection Clause

The contention of HSBC and the Prosecution is

well taken on this note. There is violation of the

equal protection clause. Under Act 4221,

provinces were given the option to apply the law

by simply providing for a probation officer. So if a

province decides not to install a probation officer,

then the accused within said province will be

unduly deprived of the provisions of the Probation

Law.

Undue Delegation of Legislative Power


There is undue delegation of legislative power.

Act 4221 provides that it shall only apply to

provinces where the respective provincial boards

have provided for a probation officer. But

nowhere in the law did it state as to what standard

(sufficient standard test) provincial boards should

follow in determining whether or not to apply the

probation law in their province. This only creates

a roving commission which will act arbitrarily

according to its whims.

Encroachment of Executive Power

Though Act 4221 is unconstitutional, the

Supreme Court recognized the power of

Congress to provide for probation. Probation

does not encroach upon the President's power to

grant pardon. Probation is not pardon. Probation

is within the power of Congress to fix penalties

while pardon is a power of the president to

commute penalties.


MATIENZO V ABELLERA G.R. No. L-45839 June 1, 1988

FACTS Petitioners and private respondents are taxicab operators in Metro Manila. The respondents, however, admit to operate colorum or kabit taxis, thus, they applied for legalization of their unauthorized excess taxis citing PD 101. Respondent Board set such applications for hearing and granted provisional authority to operate. Petitioners argue that the Board cannot do this as the six month period in the Transitory Provision has lapsed and has become functus officio. ISSUES Whether the board can grant such permits. RULING YES. The power vested by PD 101 to BOT was to grant special permits of limited term for the operation of public utility motor vehicles as may, in the judgment of the Board, be necessary to replace or convert clandestine operators into legitimate and responsible operators. Such power remains even after the six months prescribed in the law as such period merely provides for the withdrawal of the States waiver of its right to punish said colorum operators. Notice and hearing are not required for the grant of such temporary authority because of its provisional nature and that the primary application shall be given a full hearing. To determine whether a Board or Commission has power, it should be (1) liberally construed in light of its purpose for which is was created and (2) that incidentally necessary to a full implementation of legislative intent as being germane to the law. Thus, the BOR shall, from time to time, re-study the public need for public utilities in any area in the Phils for the purpose of re-evaluating the policies.


VICTORIAS MILLING COMPANY v SOCIAL SECURITY COMMISSION

G.R. No. L-16704 March 17, 1962 FACTS In 1958, the SSC issued a circular (no. 22) providing that bonuses and overtime pay shall be included in the computation of the employers' and employees' respective monthly premium contributions. However, Victorias Milling protested such circular and contended that it was contradictory to a previous circular (no.7), which expressly excluded bonuses and overtime from the computation. Moreover, it challenged the validity of the circular for lack of authority on the part of SSC to promulgate it without the approval of the President and for lack of publication in the Official Gazette. The SSC ruled that the circular is not a rule or regulation that needed the approval of the President and publication to be effective, but an administrative interpretation of the statute, a mere statement of general policy or opinion as to how the law should be construed. ISSUE Whether Circular No. 22 is a rule or regulation that requires presidential approval and publication in the OG for its effectivity HELD NO. There is a distinction between an admin rule or regulation and an admin interpretation of a law whose enforcement is entrusted to an admin body. When an administrative agency promulgates rules and regulations, it "makes" a new law with the force and effect of a valid law, while when it renders an opinion or gives a statement of policy, it merely interprets a pre-existing law. Rules and regulations when promulgated in pursuance of the procedure or authority conferred upon the administrative agency by law, partake of the nature of a statute, and compliance therewith may be enforced by a penal sanction provided in the law. This is so because statutes are usually couched in general terms, after expressing the policy, purposes, objectives, remedies and sanctions intended by the legislature. The details and the manner of carrying out the law are often times left to the administrative agency entrusted with its enforcement. In this sense, it has been said that rules and regulations are the product of a delegated power to create new or additional legal provisions that have the effect of law.

The SSC issued Circular No. 22 to apprise those concerned of the interpretation and understanding of the Commission of the law, as amended, which it was its duty to enforce. It did not add any duty or detail that was not already in the law as amended. It merely stated and circularized the opinion of the Commission as to how the law should be construed--that the exemption of bonuses, allowances and overtime pay was deleted by the amendatory law. Circular No. 22 merely advised employers-members of the system of what they should include in the determination of the monthly compensation of their employees upon which the contributions are based.


Sy Man v. Jacinto | Montemayor, J.

October 31, 1953

FACTS

Respondents in the case are Alfredo Jacinto, Commissioner of Customs (Commissioner), and Melecio Fabros, Collector of Customs for the Port of Manila (Collector). Collector ordered the seizure of 2 shipments of textile and a number of sewing machines imported by Sy Man. After due hearing, the Collector rendered a decision that those previously seized be delivered to importer (Sy Man) after payment of customs duty, sales tax and other charges, except the sewing machines which are forfeited to the government. Sys counsel sent a letter to the Collector asking for the execution of the decision as it has become final and could no longer be reviewed by the Commissioner after the lapse of 15 days given to Sy, who did not appeal the decision to the said Commissioner. The Collector replied that Sys letter had been forwarded to the Commissioner requesting for information whether the merchandise seized may be delivered to the owner upon showing that the decision had become final and executory but no reply had been received from the Commissioner. Under the theory that the Commissioner as head of the Bureau of Customs and by virtue of sec. 1152 of the Revised Administrative Code he has supervision and control over the Collector, the Commissioner promulgated a Memorandum Order:

o Collectors merely submit reports of seizures but do not transmit records of the proceedings and decisions.

o As in protest cases, decisions of Collectors in seizure cases, whether appealed or not, are subject to the review of the Commissioner. Pending action by Commissioner, final disposition of good will not be made except upon previous authority from his office.

Sy Man filed a petition to declare null and void the Memorandum Order and to order the Collector to deliver the shipments of textile seized. Sy claims that when a decision of the Collector in a seizure case is not appealed by the importer to the Commissioner within 15 days, as provided in the Sec. 1380 RAC, the decision becomes final as to

the importer and the government. Thereafter, nothing remains to be done but the release of the goods seized. TC granted the petition and ordered the Commissioner and the Collector to execute the decision on the ground that it has become final.

ISSUE

Whether the Commissioner of Customs has the

power to revise the unappealed decisions of the

Collector in seizure cases.

HELD

None. When merchandises are imported through any of ports in the country, these goods are assessed for the payment of duties and fees. The importer pays the amount assessed if he is satisfied with the assessment. Failure to protest renders the action of the Collector conclusive on the importer.

Both under protest and seizure cases the importer may appeal the decision of the Collector to the Commissioner within 15 days (Sec. 1380 RAC).

The actions of the Commissioner cant find support in the Memorandum Order itself as it was never approved by the department head and was never published by in Official Gazette. Such approval and publication are required for the memorandum order to have legal effect.

Moreover, a regulation promulgated by a Bureau Chief must not be inconsistent with law. If the law does not give the Commissioner the power to review and revise unappealed decisions of the Collector of Customs in seizure cases, then the memorandum order even if duly approved and published would equally have no effect for being inconsistent with law.

In cases involving assessment of duties, the Commissioner has the supervisory authority to order a reliquidation if he believes that the decision of the Collector was erroneous. (Sec. 1393 RAC). There is no legal provision for seizure cases. The logical inference is that the lawmakers did not deem it necessary or advisable to provide for this supervisory authority or power of revision by the


Commissioner on unappealed seizure cases.

Until the Memorandum Order was issued, it was not the practice of the Bureau to have Collectors decisions be reviewed by the Commissioner. The memo commented that Collectors only submit reports and their final disposition of seizure cases but not the records of proceedings. If the right to review had existed from the beginning, Collectors would not have ignored such practice necessitating a memo order to remind them of such.

Sec. 1380 of the RAC provides that in a seizure case, the Collector transmits all the records to the Commissioner only after the importer signifies his desire to appeal. This section does not say that without the notice of appeal, the Collector still needs to transmit the records of the case.

Sec. 1388 RAC provides that in a seizure case the owner may pay the fine imposed and the properties seized shall be surrendered and all liability concerning the seizure shall be discharged. It can be concluded that it is within the power of the importer or owner to end the case at the office of the Collector.

Where payment is made and the owner wishes to test the validity of the proceedings, he may make a formal protest at time of payment to appeal the decision to the Commissioner. The elevation of the case to the Commissioner is within the owners power and discretion.

It is argued that if the Commissioner has no power to revise or review unappealed seizure cases then if the Collector commits an error prejudicial to the government, the latter cant protect itself. The law presumes that in seizure cases Collector of Customs act honestly and correctly and as Government officials, always with an eye to the protection of the interests of the Government employing them.

o In such exceptional cases, the government is protected as in all seizure cases Sec. 1373 RAC

1 SC noted a defect in this section as it fixes no period

within which automatic review or reliquidation must

requires the Collector to immediately inform the Auditor General.

If the Government deems it necessary to provide for review and revision by the Commissioner or even by the Department Head of the decisions of the Collector of Customs in unappealed seizure cases, the Legislature may be requested to insert a section in the RAC similar to Section 13931, which applies to unprotested cases of assessment duties.

Conclusion:

The decision of the Collector of Customs in a

seizure case if not protested and appealed by the

importer to the Commissioner of Customs on

time, becomes final not only as to him but against

the Government as well, and neither the

Commissioner nor the Department Head has the

power to review, revise or modify such

unappealed decision.

The memorandum order is void and of no effect

for not being duly approved by the Dept Head and

duly published and also for being inconsistent

with law.

be effected upon order of the Commissioner.


DELEGATION OF POWERS TO

ADMINISTRATIVE AGENCIES

ALEGRE VS THE INSULAR COLLECTOR OF

CUSTOMS

FACTS:

Pursuant to Act 2380 providing for the inspection, grading, and baling of abaca, maguey, sisal, and other fibers, the Fiber Standardization Board was created, in charge of the classification, baling, and inspection of Philippine fibers. Alegre, a businessman engaged in the production and exportation of abaca, applied for certification with said board which was denied. Consequently, the Collector of Customs advised Alegre that he would not be permittd such exportation absent the certification from the board. Alegre then questioned the certain provisions of the Administrative Code relating to the exportation of abaca et al as unconstitutional and void in delegating legislative powers to the Board. ISSUE: Whether there was a valid delegation of legislative powers to the Fiber Standardization Board conferred by the Administrative Code HELD: No, there was no delegation of legislative powers. Though legislative power cannot be delegated to boards and commissions, the Legislature may delegate to them administrative functions in carrying out the purposes of a statute and various governmental power for the more efficient administration of the laws. What the law provided was a detailed method in the process of abaca et al classification, grading, inspection and baling including details of exportation of such, that all the Board had to do was to carry out the functions as set out by the law itself. PRINCIPLE: The legislature may confer not only legislative but also administrative powers to enforce and carry out the intent of the law.


ADMINISTRATIVE ADJUDICATION--- Cardinal Rights VILLA VS LAZARO FACTS: Villa wanted to open a funeral parlor in General Santos City, hence permits were applied for and thereafter issued by the City Engineering Office, certifying it as in consonance with the Zoning Ordinance. Consequently, construction was started. However, about 100 meters away is a hospital whose owner Dr. Veneracion sought a complaint to permanently enjoin the construction of the funeral parlor. Lower court dismissed the complaint due to Veneracions submission of a falsified Zoning Clearance, further adding that there was actually no prohibition in the distance between funeral parlor and hospital in said localitys Ordinances. Veneracion, instead of appealing said judgment, sought the Human Settlements Regulatory Commission (HSRC) on substantially the same grounds. HSRC ordered Villa to transmit proof of Locational Clearance of the funeral parlor to which she complied on three occasions. HRSC issued orders against Villa. Villa then filed an appeal with the Office of the President, who was acted for and on behalf by the Presidential Assistant for Legal Affairs Lazaro. Lazaros resolution denied Villas appeal and motion for extension of time to submit appeal. It is noted that both HRSC Commissioner and Lazaro made no mention on the proofs of Locational Clearance submitted by Villa at different times. ISSUE: Whether Villa was accorded due process in her quest for a permit to open a funeral parlor business HELD: No, she was not accorded due process. Administrative proceedings are not exempt from the operation of certain basic and fundamental procedural principles, such as the due process requirements in investigations and trials. And this administrative due process is recognized to include: (a) the right to notice, be it actual or constructive, of the institution of the proceedings that may affect a person's legal right;

(b) reasonable opportunity to appear and defend his rights, introduce witnesses and relevant evidence in his favor, (c) a tribunal so constituted as to give him reasonable assurance of honesty and impartiality, and one of competent jurisdiction; and (d) a finding or decision by that tribunal supported by substantial evidence presented at the hearing, or at least contained in the records or disclosed to the parties affected. These Cardinal Rights of a person in an administrative proceeding were not observed, to wit:

for initiating what is held out as an administrative proceeding against Villa without informing her of the complaint which initiated the case; for conducting that inquiry in the most informal manner by means only of communications requiring submission of certain documents, which left the impression that compliance was all that was expected of her and with which directives she promptly and religiously complied; assuming that one of the documents thus successively submitted had been received, but given the fact that on at least two occasions, their transmission had been preceded by telegrams announcing that they would follow by mail, for failing to call Villa's attention to their non-receipt or to make any other attempt to trace their whereabouts; for ruling against Villa on the spurious premise that she had failed to submit the documents required; and for maintaining to the very end that pretense of lack of compliance even after being presented with a fourth set of documents and the decision in the court case upholding her right to operate her funeral parlor in its questioned location.


PROCEDURAL DUE PROCESS

GRACILLA VS CIR

FACTS:

Gracilla filed a complaint with the CIR against

Republic Protection Agency and Fuller Paint

Manufacturing Co. (Phil.), Inc., holding them

jointly and severally liable for his dismissal,

seeking reinstatement, while also praying for paid

for his unpaid services for Sundays and legal

holidays during the whole period of his

employment, that he be given additional

compensation for night services, and that he be

credited with his earned vacation and sick leave

pay as well as back wages from the date of his

illegal dismissal up to the time he is actually

reinstated.

Presiding judge dismissed his complaint for

monetary claims but added that :"For

humanitarian reasons, however, complainant

Gracilla should be afforded preferential

opportunity by respondent Republic Protective

Agency, for assignment [to] any place other than

the Fuller Paint Manufacturing Co. (Phil.), Inc.;

else, it is suggested that he be extended

separation fee.

ISSUE:

Whether Gracilla was accorded procedural due

process.

HELD:

No. Procedural due process in administrative

proceedings require the decision be rendered on

the evidence presented at the hearing, or at least

contained in the record and disclosed to the

parties concerned. Consequently, the Court of

Industrial Relations should, in all controversial

questions, render its decision in such a manner

that the parties to the proceeding can know the

various issues involved, and the reasons for the

decisions rendered. The performance of this duty

is inseparable from the authority conferred upon

it. The failure of respondent court, then, to pass

upon the monetary claims raised by petitioner,

amounted to a disregard of such a cardinal right

embraced in due process, namely, that the issues

raised by a party should not be ignored or left

undecided. Especially so, should it be in this case

where the monetary claims were timely raised

and insisted upon at all stages of the proceeding.

====================================

*Just a principle lifted from Vivo vs PAGCOR (not

part of our cases though): *** thanks Nurse

Teng***

In administrative proceedings, procedural due process has been recognized to include the following:

(1) The right to actual or constructive notice of the institution of proceedings which may affect a respondents legal rights;

(2) A real opportunity to be heard personally or with the assistance of counsel, to present witnesses and evidence in ones favor, and to defend ones rights;

(3) A tribunal vested with competent jurisdiction and so constituted as to afford a person charged administratively a reasonable guarantee of honesty as well as impartiality; and

(4) A finding by said tribunal which is supported by substantial evidence submitted for consideration during the hearing or contained in the records or made known to the parties affected.


ESTATE OF FLORENCIO P. BUAN, Petitioner, vs. PAMPANGA BUS COMPANY AND LA MALLORCA, Respondents.

FACTS:

The estate of Florencio P. Buan, herein

petitioner, is an authorized bus operator along

various lines in central and northern Luzon, with

authority to operate 8 auto-trucks along the

Manila-Bagac line and 11 along the Moron

Dinalupihan line. Allegedly in response to various

resolutions of municipal councils and on petition

of civic and labor groups in the province of Bataan

urging extension of its services to their respective

municipalities, petitioner applied in four cases in

the Commission for certificates of public

convenience to operate additional trips between

Manila and various municipalities and barrios in

Bataan.

The Pampanga Bus Company and La Mallorca

opposed these applications, both alleging that

they are authorized to operate and are actually

operating a fleet of auto-trucks on the lines

applied for and rendering adequate and

satisfactory service; that the additional services

applied for are superfluous, will not promote

public interest in a proper and suitable manner,

and will result in cut-throat and ruinous

competition. The Commission, after hearing the

parties and their evidence and having before it

the records of the authorized services on the lines

applied for, as well as the findings of two of its

agents who had been ordered by it to make an

on-the-spot survey of the passenger traffic along

those lines, rendered a joint decision in the four

cases, denying the applications on the grounds

that petitioner had not made a case for the grant

of the certificates applied for, that the service of

the oppositors was adequate and sufficient for the

actual needs of the public and that the grant of

the applications would only result in unnecessary

or wasteful competition.

Reconsideration of this decision having been

denied, petitioner has sought a review.

ISSUE: Whether or not the Public Service

Commission has acted outside the scope of its

authority in the supervision and control of public

transportation?

HELD: Yes. The law, in investing the Public Service Commission with the power of supervision and control over public transportation, has also clothed it with broad discretion in the exercise of that power. With that discretion this Court is not supposed to interfere except in case of clear abuse. Such has not been shown to be the case here. What appears is that the Commission, faced with the conflict of evidence on the adequacy or inadequacy of the present service, has sought to discover the truth through an on-the-ground inspection and observation by its own agents and has, on the basis of information thus obtained, arrived at the conclusion that the additional service applied for is uncalled for because there is already amplitude, if not superabundance, in the number of authorized trips.

That conclusion is amply supported by the record and is far from being the product of partiality or unfair discrimination. And it not clearly appearing that discretion has been abused or that the Commission has illegally used its powers, we have to respect its judgment and not to try to replace it with our own.


G.S. WEIGALL,Plaintiff-Appellee, vs. W. MORGAN SHUSTER, Collector of Customs of the Philippine Islands,Defendant-Appellant.

FACTS:

Defendant Collector of Customs of the

Philippine Archipelago, officially imposed a fine of

$200 United States money, upon the plaintiff, the

captain of the British steamer Loonsang, for a

violation of the Chinese Exclusion Law, in

permitting the escape of an immigrant from his

ship, and asserted a lien upon her, refusing

clearance papers unless the master paid the fine.

Instead of paying it, the plaintiff brought this

action upon which an injunction was issued,

ordering the defendant to desist and refrain from

further proceeding in any way to levy upon or

collect from the plaintiff the fine of USD200

mentioned in the plaintiffs complaint.

ISSUE:

Whether or not the Collector of Customs have

authority to impose a fine and seize the vessel in

question.

HELD:

No. The fine to be imposed upon the plaintiff and

his vessel in the present instance was not one for

the administrative action because it had to be

laid and enforced in accordance with the law

of Congress its being and which had authorized

no such action. The error of the defendant had

root in the notion, expressed in his testimony "that

the Act of Congress of April 29, had omitted to

provide machinery for the enforcement of the

laws thereby enacted." That notion overlooked

that fact that the usual machinery for the

enforcement of the laws is found in regularly

constituted courts and involved the strains

assumption that the status that the terms of the

Acts of Congress adequate to the home territory

of the United States where not specific enough to

be carried out in this Islands. Those acts did,

impliedly, if not explicitly, provide for the manner

of their enforcement, and in that respect were not

open for amendment for the Philippine

Commission, and we assume that it was no part

of intention of that Commission to amend them or

supplement them by any legislation at variance

with them.

x x x

The defect of an argument is that it loses sight of

the incident that the fine was not imposed by the

court, but in the first instance by the Collector,

and it was to enforce his fine, already laid, and his

seizure, and that suit was brought in the Court of

Customs Appeals. The original administrative act

imposing the fine having, as we have already

seen, been invalid, the proceeding based upon it

cannot stand. This customs court might have

given power to enforce the provisions of the

Chinese Exclusion Act in accordance with the

law of Congress, but SUCH WAS NOT THE

SCOPE OF THE ACTS OF THE COMMISSION,

nor such the procedure attempted in this case.


FRANCISCO S. TATAD,

vs.

THE SECRETARY OF THE DEPARTMENT OF

ENERGY AND THE SECRETARY OF THE

DEPARTMENT OF FINANCE G.R. No. 127867

November 5, 1997

Facts:

The petitions at bar challenge the constitutionality of Republic Act No. 8180 entitled "An Act Deregulating the Downstream Oil Industry and For Other Purposes". 1 R.A. No. 8180 ends twenty six (26) years of government regulation of the downstream oil industry. Few cases carry a surpassing importance on the life of every Filipino as these petitions for the upswing and downswing of our economy materially depend on the oscillation of oil.

Prior to 1971, there was no government agency regulating the oil industry other than those dealing with ordinary commodities. Oil companies were free to enter and exit the market without any government interference. There were four (4) refining companies (Shell, Caltex, Bataan Refining Company and Filoil Refining) and six (6) petroleum marketing companies (Esso, Filoil, Caltex, Getty, Mobil and Shell), then operating in the country.

In G.R. No. 124360, petitioner Francisco S. Tatad seeks the annulment of section 5(b) of R.A. No. 8180. Section 5(b) provides:

b) Any law to the contrary

notwithstanding and starting with the

effectivity of this Act, tariff duty shall be

imposed and collected on imported crude

oil at the rate of three percent (3%) and

imported refined petroleum products at

the rate of seven percent (7%), except

fuel oil and LPG, the rate for which shall

be the same as that for imported crude

oil: Provided, That beginning on January

1, 2004 the tariff rate on imported crude

oil and refined petroleum products shall

be the same: Provided, further, That this

provision may be amended only by an

Act of Congress.

Issues:

(1) Whether or not the petitions raise a justiciable

controversy

(2) Whether or not the petitioners have the

standing to assail the validity of the law

(3) Whether or not Sec. 5(b) of RA 8180 violates

the one title one subject requirement of the

Constitution

(4) Whether or not Sec. 15 of RA 8180 violates

the constitutional prohibition on undue delegation

of power

(5) Whether or not RA 8180 violates the

constitutional prohibition against monopolies,

combinations in restraint of trade and unfair

competition

Held:

As to the first issue, judicial power includes not

only the duty of the courts to settle actual

controversies involving rights which are legally

demandable and enforceable, but also the duty to

determine whether or not there has been grave

abuse of discretion amounting to lack or excess

of jurisdiction on the part of any branch or

instrumentality of the government. The courts, as

guardians of the Constitution, have the inherent

authority to determine whether a statute enacted

by the legislature transcends the limit imposed by

the fundamental law. Where a statute violates the

Constitution, it is not only the right but the duty of

the judiciary to declare such act as

unconstitutional and void.

The effort of respondents to question the legal

standing of petitioners also failed. The Court has

brightlined its liberal stance on a petitioners locus

standi where the petitioner is able to craft an

issue of transcendental significance to the

people. In the case, petitioners pose issues which

are significant to the people and which deserve

the Courts forthright resolution.

It is also contended that Sec. 5(b) of RA 8180 on

tariff differential violates the provision of the

Constitution requiring every law to have only one

subject which should be expressed in its title. The

Court did not concur with this contention. The title

need not mirror, fully index or catalogue all

contents and minute details of a law. A law having

a single general subject indicated in the title may

contain any number of provisions, no matter how


diverse they may be, so long as they are not

inconsistent with or foreign to the general subject,

and may be considered in furtherance of such

subject by providing for the method and means of

carrying out the general subject. The Court held

that Sec. 5 providing for tariff differential is

germane to the subject of RA 8180 which is the

deregulation of the downstream oil industry.

Petitioners also assail Sec. 15 of RA 8180 which

fixes the time frame for the full deregulation of the

downstream oil industry for being violative of the

constitutional prohibition on undue delegation of

power. There are two accepted tests to determine

whether or not there is a valid delegation of

legislative power: the completeness test and the

sufficient standard test. Under the first test, the

law must be complete in all its terms and

conditions when it leaves the legislative such that

when it reaches the delegate the only thing he will

have to do is to enforce it. Under the sufficient

standard test, there must be adequate guidelines

or limitations in the law to map out the boundaries

of the delegates authority and prevent the

delegation from running riot. Section 15 can

hurdle both the completeness test and the

sufficient standard test. Congress expressly

provided in RA 8180 that full deregulation will

start at the end of March 1997, regardless of the

occurrence of any event. Full deregulation at the

end of March 1997 is mandatory and the

Executive has no discretion to postpone it for any

purported reason. Thus, the law is complete on

the question of the final date of full deregulation.

The discretion given to the President is to

advance the date of full deregulation before the

end of March 1997. Section 15 lays down the

standard to guide the judgment of the President.

He is to time it as far as practicable when the

prices of crude oil and petroleum products in the

world market are declining and when the

exchange rate of the peso in relation to the US

dollar is stable.

Petitioners also argued that some provisions of

RA 8180 violate Sec. 19, Art. XII of the

Constitution. Section 19, Art. XII of the

Constitution espouses competition. The

desirability of competition is the reason for the

prohibition against restraint of trade, the reason

for the interdiction of unfair competition, and the

reason for regulation of unmitigated monopolies.

Competition is thus the underlying principle of

Sec. 19, Art. XII of the Constitution which cannot

be violated by RA 8180. Petron, Shell and Caltex

stand as the only major league players in the oil

market. As the dominant players, they boast of

existing refineries of various capacities. The tariff

differential of 4% on imported crude oil and

refined petroleum products therefore works to

their immense benefit. It erects a high barrier to

the entry of new players. New players that intend

to equalize the market power of Petron, Shell and

Caltex by building refineries of their own will have

to spend billions of pesos. Those who will not

build refineries but compete with them will suffer

the huge disadvantage of increasing their product

cost by 4%. They will be competing on an uneven

field. The provision on inventory widens the

balance of advantage of Petron, Shell and Caltex

against prospective new players. Petron, Shell

and Caltex can easily comply with the inventory

requirement of RA 8180 in view of their existing

storage facilities. Prospective competitors again

will find compliance with this requirement difficult

as it will entail a prohibitive cost.

The most important question is whether the

offending provisions can be individually struck

down without invalidating the entire RA 8180. The

general rule is that where part of a statute is void

as repugnant to the Constitution, while another

part is valid, the valid portion, if separable from

the invalid, may stand and be enforced. The

exception to the general rule is that when the

parts of a statute are so mutually dependent and

connected, as conditions, considerations,

inducements or compensations for each other, as

to warrant a belief that the legislature intended

them as a whole, the nullity of one part will vitiate

the rest. RA 8180 contains a separability clause.

The separability clause notwithstanding, the

Court held that the offending provisions of RA

8180 so permeate its essence that the entire law

has to be struck down. The provisions on tariff

differential, inventory and predatory pricing are

among the principal props of RA 8180. Congress

could not have regulated the downstream oil

industry without these provisions. Unfortunately,

contrary to their intent, these provisions on tariff

differential, inventory and predatory pricing inhibit

fair competition, encourage monopolistic power

and interfere with the free interaction of market

forces.


ERNESTO M. MACEDA

vs.

ENERGY REGULATORY BOARD, CALTEX

(Philippines), INC., PILIPINAS SHELL

PETROLEUM CORPORATION AND PETRON

CORPORATION, respondents.

G.R. No. 96349 July 18, 1991

Facts:

In G.R. No. 96266, petitioner Maceda seeks nullification of the Energy Regulatory Board (ERB) Orders dated December 5 and 6, 1990 on the ground that the hearings conducted on the second provisional increase in oil prices did not allow him substantial cross-examination, in effect, allegedly, a denial of due process.

On September 21, 1990, the ERB issued an order granting a provisional increase of P1.42 per liter. Petitioner Maceda filed a petition for Prohibition on September 26, 1990 (E. Maceda v. ERB, et al., G.R. No. 95203), seeking to nullify the provisional increase. We dismissed the petition on December 18, 1990, reaffirming ERB's authority to grant provisional increase even without prior hearing, pursuant to Sec. 8 of E.O. No. 172.

In the same order of September 21, 1990, authorizing provisional increase, the ERB set the applications for hearing with due notice to all interested parties on October 16, 1990. Petitioner Maceda failed to appear at said hearing as well as on the second hearing on October 17, 1990.

Petitioner Maceda maintains that this order of proof deprived him of his right to finish his cross-examination of Petron's witnesses and denied him his right to cross-examine each of the witnesses of Caltex and Shell. He points out that this relaxed procedure resulted in the denial of due process.

Issue:

Whether ERB acted within its jurisdiction.

Whether acted in grave abuse of discretion

amounting to lack of jurisdiction

Held:

The Solicitor General has pointed out:

. . . The order of testimony both with respect to

the examination of the particular witness and to

the general course of the trial is within the

discretion of the court and the exercise of this

discretion in permitting to be introduced out of the

order prescribed by the rules is not improper (88

C.J.S. 206-207).

Such a relaxed procedure is especially true in

administrative bodies, such as the ERB which in

matters of rate or price fixing is considered as

exercising a quasi-legislative, not quasi-judicial,

function As such administrative agency, it is not

bound by the strict or technical rules of evidence

governing court proceedings (Sec. 29, Public

Service Act; Dickenson v. United States, 346,

U.S. 389, 98 L. ed. 132, 74 S. St. 152). (Emphasis

supplied)

In fact, Section 2, Rule I of the Rules of Practice

and Procedure Governing Hearings Before the

ERB provides that

These Rules shall govern pleadings, practice and

procedure before the Energy Regulatory Board in

all matters of inquiry, study, hearing, investigation

and/or any other proceedings within the

jurisdiction of the Board. However, in the broader

interest of justice, the Board may, in any

particular matter, except itself from these rules

and apply such suitable procedure as shall

promote the objectives of the Order. (pp. 163-

164, Rollo)


Lupangco, et al. v CA (GR No. 77372) April 29, 19882 Facts of the case: The Professional Regulation Commission (PRC) issued resolution No. 1053 for all those applying for admission to take the licensure examinations in accountancy. The purpose if the resolution is to preserve the integrity and purity of licensure examinations. Lupo L. Lupangco and some of the affected reviewees, representing themselves and other reviewees similarly situated, filed a complaint for injunction with a prayer for the issuance of writ of preliminary injunction against respondent PRC and to declare Resolution No. 105 as unconstitutional. RTC court ruled to continue to try the case, denying PRCs motion to dismiss. On appeal, CA ruled in favour of PRC that RTC court is without jurisdiction to try the case, hence this appeal by the petitioner. Issue: Whether or not Resolution No. 105 of the PRC is unconstitutional. Held: Yes, resolution No. 105 is unconstitutional for the following reasons:

1.) The issued resolution is unreasonable on its face. More so applying the reasonable connection test, although the (a) purpose of the law is reasonable, which is to preserve the integrity and

2 Case Digest Topic: Liberal Interpretation of rules and regulation (p. 125, Chapter 3, 2013 ed. Admin Law by De Leon) 3 x x x No examinee shall attend any review class, briefing, conference or the like conducted by, or shall receive any hand-out, review material, or any tip from any school, college or university, or any review center or the like or any reviewer, lecturer, instructor

purity of licensure examination for accountants, the (b) means employed, which is to prevent reviewee-examinees from taking any legal step to prepare 3 days before the examination, is unreasonable. More so, the means employed cannot even distinguish between those who are taking legal steps to prepare and those otherwise (ie. Those who use leakages and like materials) ergo the issued resolution is arbitrary. The issued resolution is an unlawful deprivation of liberty rights of reviewee-examinees is their preparation for the licensure examination for accountants. (It is to be noted also that the resolution hampers with the academic freedom of schools)

2.) It is an axiom in administrative law that administrative authorities should not act arbitrarily and capriciously in the issuance of rules and regulations. To be valid, such rules and regulations must be reasonable and fairly adapted to the end in view. If shown to bear no reasonable relation to the purposes for which they are authorized to be issued, then they must be held to be invalid.

3.) Resolution No. 105 is that it violates the academic freedom of the schools concerned. Respondent PRC cannot interfere with the conduct of review that review schools and centers believe would best enable their enrolees to meet the standards required before becoming a full fledged public accountant. Unless the means or methods of instruction are clearly found to be inefficient, impractical, or riddled

official or employee of any of the aforementioned or similars institutions during the three days immediately proceeding every examination day including examination day. Any examinee violating this instruction shall be subject to the sanctions prescribed by Sec. 8, Art. III of the Rules and Regulations of the Commission. x x x


with corruption, review schools and centers may not be stopped from helping out their students.

SC cited the case of Garcia v The Faculty Admission Committee, Loyola School of Theology, 24 regarding academic freedom to wit: ... It would follow then that the school or

college itself is possessed of such a right.

It decides for itself its aims and

objectives and how best to attain them.

It is free from outside coercion or

interference save possibly when the

overriding public welfare calls for some

restraint. It has a wide sphere of

autonomy certainly extending to the

choice of students. This constitutional

provision is not to be construed in a

niggardly manner or in a grudging

fashion.

(Maker of this digest believes that the limited/scarce application of the Liberal interpretation of rules and regulation of administrative agencies to this case applies on a particular circumstance where there is ambiguity on whether there is in existence of any need to interfere with the rights of private persons through the execution of rules and regulation, the court will rule liberally in favour of the private person and strictly against the implementing authority.)


People v Maceren (G.R. No. L-32166) October 18, 19774 Facts of the case: Jose Buenaventura, Godofredo Reyes, Benjamin Reyes, Nazario Aquino and Carlito del Rosario were caught and charged of the crime electro fishing5 in violation of Fisheries Administrative Order No. 84-1. by the Constabulary. Fisheries Administrative Order No. 84-1 is promulgated by Secretary of Agriculture and Natural Resources, upon the recommendation of the Fisheries Commission.

Both the municipal court and court and the court of first instance dismissed the case. The lower court held that, since the law does not clearly prohibit electro fishing, the executive and judicial departments cannot consider it unlawful. As legal background, it should be stated that section 11 of the (old) Fisheries Law prohibits "the use of any obnoxious or poisonous substance" in fishing. It is noteworthy that the Prosecution defends its side by citing section 11 AND section 83 of the Fisheries Law. Section 83 of the pertinent law provides penalty for: "any other violation of" the Fisheries Law or of any rules and regulations promulgated thereunder. The prosecution contends that any other violation should include electro fishing and is sufficient to cover the defendants in the case. Issue: Whether or not the Order No. 84-1 covers electro fishing under Section 11 and/or Section 84 of the (old) Fisheries Law. Held:

4 Case Digest Topic: Penal Rules and Regulation (p. 129, Chapter 3, 2013 ed. Admin Law by De Leon) 5 (*Electro Fishing. Electro fishing is the catching of fish with the use of electric current. The equipment used are of many electrical

No, said law do not authorize the Secretary of Agriculture and Natural Resources to penalize electro fishing. The reason is that the Fisheries Law does not

expressly prohibit electro fishing. As electro

fishing is not banned under that law, the

Secretary of Agriculture and Natural Resources

and the Commissioner of Fisheries are powerless

to penalize it. In other words, Administrative

Orders Nos. 84 and 84-1, in penalizing electro

fishing, are devoid of any legal basis. Had the

lawmaking body intended to punish electro

fishing, a penal provision to that effect could

have been easily embodied in the old Fisheries

Law.

(Principles. Reading matter) The lawmaking body cannot delegate to an executive official the power to declare what acts should constitute an offense. It can authorize the issuance of regulations and the imposition of the penalty provided for in the law itself Administrative agent are clothed with rule-making powers because the lawmaking body finds it impracticable, if not impossible, to anticipate and provide for the multifarious and complex situations that may be encountered in enforcing the law. All that is required is that the regulation should be germane to the defects and purposes of the law and that it should conform to the standards that the law prescribes Administrative regulations adopted under legislative authority by a particular department must be in harmony with the provisions of the law, and should be for the sole purpose of carrying into effect its general provisions. By such regulations, of course, the law itself cannot be extended The rule-making power must be confined to details for regulating the mode or proceeding to

devices which may be battery or generator-operated and from and available source of electric current.)


carry into effect the law as it has been enacted. The power cannot be extended to amending or expanding the statutory requirements or to embrace matters not covered by the statute. Rules that subvert the statute cannot be sanctioned. "Rules and regulations when promulgated in pursuance of the procedure or authority conferred upon the administrative agency by law, partake of the nature of a statute, and compliance therewith may be enforced by a penal sanction provided in the law. This is so because statutes are usually couched in general terms, after expressing the policy, purposes, objectives, remedies and sanctions intended by the legislature. The details and the manner of carrying out the law are oftentimes left to the administrative agency entrusted with its enforcement. In this sense, it has been said that rules and regulations are the product of a delegated power to create new or additional legal provisions that have the effect of law." The rule or regulation should be within the scope of the statutory authority granted by the legislature to the administrative agency A penal statute is strictly construed. While an administrative agency has the right to make ranks and regulations to carry into effect a law already enacted, that power should not be confused with the power to enact a criminal statute. An administrative agency can have only the administrative or policing powers expressly or by necessary implication conferred upon it


US v Tupasi Molina (G.R. No. L-9878) December 24, 19146 Facts of the case: Frank Tupasi Molina was convicted in the court of first instance in the municipality of Tayum in Ilocos Sur for the crime of Perjury. It was adduced among the facts that Molina was in the process of submitting requirement for the examination for admission for police service in the province of Ilocos. One of the requirements is to submit a statement under oath that he had never been indicted, tried, or sentenced for the violation of any law, ordinance, or regulation in any court, where in this particular case he was in fact convicted three (3) times prior to his application for examination. The defendant, appealed the case to the SC with, among others, the assignment of error to the court of first instance that:

1. The trial court erred in holding section 37 of Act No. 1697 to be applicable in this case

Issue: Whether or not the defendant can be convicted of perjury under section 3 of Act No. 1697 where the law (Act No. 2169), from which section 3 of Act No. 1697 relates to, did not expressly grant penalty of perjury. Held: Yes, there can be penalty of perjury imposed since the Law (Act No 2169). The penalty of perjury is an indispensable element in order to require or force to require all those who will apply for police service to faithfully comply with its requirement notwithstanding it is not

6 Case Digest Topic: Penal Rules and Regulation (p. 129, Chapter 3, 2013 ed. Admin Law by De Leon) 7 Xxx Any person who, having taken an oath before a competent tribunal, officer, or person, in any case in which a law of the Philippine Islands authorizes an oath to be administered, that he will testify, declare, depose, or certify truly, or that any written

expressly provided for in the law to which the rules and regulation in this case relates. (Attaching pertinent proviso in the aforementioned law) xxx Act No. 2169 of the Philippine Legislature, which

is an Act to provide for the reorganization,

government, and inspection of municipal police

of the municipalities or provinces and

subprovinces organized under Act No. 83,

provides for the reorganization of the municipal

police of the municipalities or provinces and

subprovinces organized under Act No. 83.

Said Act further provides that, subject to the

approval of the Secretary of Commerce and

Police, the Director of Constabulary shall prepare

general regulations for the good government,

discipline, and inspection of the municipal

police, "compliance wherewith shall be

obligatory for all members of the organization."

Said Act further provides for an examining board

for the municipal police. It further provides that,

subject to the approval of the Secretary of

Commerce and Police, the Director of

Constabulary shall prepare an examination

manual, prescribing, at the same time, suitable

rules for the conduct of the examination.

Said Act (No. 2169) also provides for the time

and place for holding said examinations.

Section 9 of said Act provides that: "To be eligible

for examination, a candidate shall have the

following requirements: . . . (6) Have no criminal

record."

In accordance with the requirements of said law, the Director of Constabulary prepared an examination manual, prescribing at the same

testimony, declaration, deposition or certificate by him subscribed is true, willfully and contrary to such oath states or subscribes any material matter which he does not believe to be true, is guilty or perjury, and shall be punished, etc. xxx


time rules for conducting examinations, which examination manual was approved by the Secretary of Commerce and Police, and thereby was given the force of law. xxx The regulations adopted under legislative authority by a particular department must be in harmony with the provisions of the law, and for the sole purpose of carrying into effect its general provisions. By such regulations, of course, the law itself can not be extended. So long, however, as the regulations relate solely to carrying into effect the provisions of the law, they are valid. A violation of a regulation prescribed by an executive officer of the Government in conformity with and based upon a statute authorizing such regulation, constitutes an offense and renders the offender liable to punishment in accordance with the provisions of law


G.R. No. L-47178 November 25, 1940

PETITIONER: THE INTERNATIONAL

HARDWOOD AND VENEER COMPANY (IHVC)

RESPONDENT: THE PAGIL FEDERATION

OF LABOR (PFL)

PONENTE: LAUREL, J

FACTS:

The Secretary of Labor certified to the Court of

Industrial Relations that an Industrial dispute

existed between the petitioner and certain of its

employees who are members of respondent

union, and that the controversy was a proper one

to be dealt with by said Court in the public interest

under section 4 of Commonwealth Act No. 103.

Among the demands made in the dispute were

setting the minimum daily wage of the laborers,

devising a proper schedule of rate of wages and

the rate of wages for the mountain camps should

be higher than those given in town. A judgment8

was thereafter rendered. However, the petitioner

prayed for reconsideration of the Decision

Adicional. While said petition was pending, the

petitioner filed a motion alleging (1) that the Court

of Industrial Relations has no authority to

determine minimum wages for an individual

employer in connection with a particular and

specific industrial dispute under the provisions of

section 4 of Commonwealth Act No. 103; (2) that

such authority would constitute an undue

delegation of legislative power to the Court of

Industrial Relations and would deny the petitioner

the equal protection of the laws, thus rendering

said section unconstitutional and void

The Petitioner IHVS claims that if Section 4 of

Commonwealth Act No. 103 is held to empower

the Court of Industrial Relations to determine

minimum wages in connection with an industrial

dispute, the section is unconstitutional as

constituting undue delegation of legislative power

to the court, depriving the petitioner of the equal

protection of the laws.

In support of this claim, petitioner argues that the

determination of minimum wages is a legislative

8 in decision adicional of September 19, 1939 (decision is written in Spanish)

function, and that Section 4 of Commonwealth

Act No. 103 does not indicate in that manner, by

what standards, or in accordance with what rules,

the Court of Industrial Relations shall determine

minimum wages under said section.

Section 20 of the Commonwealth Act 103

prescribes that in the hearing, investigation and

determination of any question or controversy and

in exercising any duties and powers under the

Act, the court shall act according to justice and

equity and substantial merits to the case, without

regard to technicalities of legal forms.

Issue:

Has the National Assembly, by this Section 20,

furnished sufficient standard by which the court

will be guided in exercising its discretion in the

determination of any question or controversy

before it?

Held:

Yes. (1) Discretionary power conferred judicial in character. The National Assembly, by Section 20, has furnished sufficient standard by which the court will be guided in exercising its discretion in the determination of any question or controversy before it . The discretionary power thus conferred is judicial in character and does not infringe upon the principle of separation of powers and prohibition against the delegation of legislative function, and the equal protection clause of the Constitution


G.R. No. L-24489 (SCRA 242) September 28, 1968

PETITIONER: AUGUSTIN GRACILLA

RESPONDENT: COURT OF INDUSTRIAL

RELATIONS, FULLER PAINT

MANUFACTURING CO., (PHIL.), INC. and

REPUBLIC PROTECTIVE AGENCY (FPM)

PONENTE: FERNANDO, J.:

FACTS:

Petitioner, Agustin Gracilla, objecting to his

dismissal as security guard of and seeking

reinstatement, filed a complaint against

private respondent, FPM with respondent

CIR. The presiding judge dismissed his

complaint for lack of merit and for

humanitarian reasons it was ordered that he

be extended with separation pay. He then

filed motion for reconsideration. It was again

denied it stating: After a close perusal of the

records as well as the written arguments in

support of said motion, the Court en banc

fails to find sufficient justification for altering

or modifying the aforesaid decision.

Hence, the appeal by certiorari, petitioners

monetary claims apparently having been

overlooked in the decision.

Issue: Did the failure to rule on the above

monetary claims constitute a denial of due

process?

Held:

Yes. It was a denial of due process. (1) CIR more of an administrative board with functions more active and extensive than ordinary courts. So it must be deference paid to the holding in Ang Tibay v Court of Industrial Relations, where, as Justice Laurel correctly noted:

The court of Industrial Relations is a special court whose functions are specifically stated in the law of its creation. It is more of an

administrative board than a part of the integrated judicial system of the nation. It is not intended to be a mere reception organ of the Government. Unlike a court of justice which is essentially passive, acting only when its jurisdiction is invoked and deciding only cases that are presented to it by the parties-litigants, the function of the Court of Industrial Relations, as will appear from perusal of its organic law, is more active, affirmative and dynamic, It not only exercises judicial or quasi-judicial functions in the determination of disputes between employers and employees but its functions are far more comprehensive and extensive.

(2) Fundamental requirements of due process, nevertheless, not be ignored or disregarded. Nevertheless, he was careful to point out that, freed as respondent court from rigidity of certain procedural requirements, it cannot ignore or disregard the fundamental and essential requirements of due process in trial and investigations of an administrative character. He mentioned what he considered cardinal primary rights which must be respected, otherwise, the dictates of due process are not complied with. One of such due process requirements is relevant here: the Court of Industrial Relations should, in all controversial questions, render its decision in such a manner that the parties proceeding can know the various issues involved, and the reasons for the decisions rendered. The performance of this duty is inseparable from the authority conferred upon it.

(3) Due process violated by the failure to pass upon monetary claims timely raised. The failure or respondent court, then to pass upon the monetary claims raised by the petitioner, amounted to a disregard of such a cardinal right embraced in due process, or left undecided. Especially so, should it be in this case, where the monetary claims were timely raised and insisted upon at all stages of the proceeding

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