dismissal with forfeiture of all benefits and disqualification for
reappointment in the government service. In this petition, petitioner
EN BANC
[G.R. No. 112745. October 16, 1997.]
AQUILINO T. LARIN, petitioner, vs. THE
EXECUTIVE SECRETARY, SECRETARY OF
FINANCE, COMMISSIONER OF THE BUREAU
OF INTERNAL REVENUE AND THE
COMMITTEE CREATED TO INVESTIGATE THE
ADMINISTRATIVE COMPLAINT AGAINST
AQUILINO T. LARIN, COMPOSED OF
FRUMENCIO A. LAGUSTAN, JOSE B.
ALEJANDRINO AND JAIME M.
MAZA, respondents.
Cruz, Cruz & Navarro III for petitioner.
The Solicitor General for respondents.
SYNOPSIS
Petitioner was convicted by the Sandiganbayan of the crimes of
violation of Section 268 (4) of the National Internal Revenue Code
and Section 3 (e) of Republic Act 3019. The fact of his conviction
was reported to the President of the Philippines and acting by
authority of the latter, then Sr. Deputy Executive Secretary Leonardo
A. Quisumbing issuedMemorandum Order No. 164 which provides
for the creation of an Executive Committee to investigate the
administrative charge against petitioner. The Committee directed the
petitioner to respond to the administrative charge. Meanwhile, the
President issued the challenged Executive Order No. 132 which
mandated the streamlining of the Bureau of Internal Revenue. The
Excise Tax Service or the Specific Tax Service, of which petitioner
was the Assistant Commissioner, was one of those offices that was
abolished by the said executive order. The President found petitioner
guilty of grave misconduct and imposed upon him the penalty of
challenges the authority of the President to dismiss him from office
arguing that insofar as presidential appointees who are Career
Executive Service Officers are concerned, the President exercises
only the power of control and not the power to remove.cdasia
The Supreme Court granted the petition and reinstated petitioner
with full backwages. The Court held that where the very basis of the
administrative case against petitioner is his conviction in the criminal
action which was later on set aside by the Court upon a categorical
and clear finding that the acts for which he was administratively held
liable are not unlawful and irregular, the acquittal of the petitioner in
the criminal case necessarily entails the dismissal of the
administrative action against him, because in such a case, there is
no more basis nor justifiable reason to maintain the administrative
suit. The Court also ruled that the reorganization of the Bureau was
tainted with circumstances considered as evidences of bad faith.
Petition granted.
SYLLABUS
1. CONSTITUTIONAL LAW; BILL OF RIGHTS; PROCEDURAL DUE
PROCESS; IT CANNOT BE ARGUED THAT PETITIONER WAS
DENIED OF DUE PROCESS, AS THE RECORDS CLEARLY
SHOW THAT HE SUBMITTED HIS LETTER-RESPONSE TO THE
ADMINISTRATIVE CHARGE FILED AGAINST HIM AND OTHER
DOCUMENTS ATTACHED AS ANNEXES TO HIS LETTER, ALL OF
WHICH ARE EVIDENCE SUPPORTING HIS DEFENSE. — We are
not unaware of the rule that since administrative cases are
independent from criminal actions for the same act or omission, the
dismissal or acquittal of the criminal charge does not foreclose the
institution of administrative action nor carry with it the relief from
administrative liability. However, the circumstantial setting of the
instant case sets it miles apart from the foregoing rule and placed it
well within the exception. Corollarily, where the very basis of the
administrative case against petitioner is his conviction in the criminal
action which was later on set aside by this court upon a categorical
and clear findings that the acts for which he was administratively
held liable are not unlawful and irregular, the acquittal of the
petitioner in the criminal case necessarily entails the dismissal of the
administrative action against him, because in such a case, there is
no basis nor justifiable reason to maintain the administrative suit. On
the aspect of procedural due process, suffice it to say that petitioner
was given every chance to present his side. The rule is well settled
that the essence of due process in administrative proceedings is that
a party be afforded a reasonable opportunity to be heard and to
submit any evidence he may have in support of his defense The
records clearly show that on October 1, 1993 petitioner submitted his
letter-response dated September 30, 1993 to the administrative
charge filed against him. Aside from his letter, he also submitted
various documents attached as annexes to his letter, all of which are
evidences supporting his defense. Prior to this, he received a letter
dated September 17, 1993 from the Investigation Committee
requiring him to explain his side concerning the charge. It cannot
therefore be argued that petitioner was denied of due process.
2. POLITICAL LAW; EXECUTIVE DEPARTMENT; THE FACT THAT
PETITIONER IS A PRESIDENTIAL APPOINTEE DOES NOT GIVE
THE APPOINTING AUTHORITY THE LICENSE TO REMOVE HIM
AT WILL OR AT HIS PLEASURE FOR IT IS AN ADMITTED FACT
THAT HE IS LIKEWISE A CAREER SERVICE OFFICER WHO
UNDER THE LAW IS THE RECIPIENT OF TENURIAL
PROTECTION, THUS, MAY ONLY BE REMOVED FOR A CAUSE
UNDER A VALID PROCEEDINGS. — Petitioner is a presidential
appointee who belongs to career service of the Civil Service. Being a
presidential appointee, he comes under the direct disciplining
authority of the President. This is in line with the well-settled principle
that the "power to remove is inherent in the power to appoint"
conferred to the President by Section 16, Article VII of
the Constitution. Thus, it is ineluctably clear that Memorandum Order
No. 164, which created a committee to investigate the administrative
charge against petitioner, was issued pursuant to the power of
removal of the President. This power of removal, however, is not an
absolute one which accepts no reservation. It must be pointed out
that petitioner is a career service officer. Under the Administrative
Code of 1987, career service is characterized by the existence of
security of tenure, as contra-distinguished from non-career service
whose tenure is co-terminus with that of the appointing authority or
subject to his pleasure, or limited to the period specified by law or to
the duration of a particular project for which purpose the employment
was made. As a career service officer, petitioner enjoys the right to
security of tenure. No less than the 1987 Constitution guarantees the
right of security of tenure of the employees of the civil service.
Specifically, Section 36 of P.D. No. 807, as amended, otherwise
known as Civil Service Decree of the Philippines, is emphatic that
career service officers and employees who enjoy security of tenure
may be removed only for any of the causes enumerated in said law.
In other words, the fact that the petitioner is a presidential appointee
does not give the appointing authority the license to remove him at
will or at his pleasure for it is an admitted fact that he is likewise a
career service officer who under the law is the recipient of tenurial
protection, thus, may only be removed for a cause and in
accordance with procedural due process.
3. ID.; ID.; ID.; EXECUTIVE ORDER NO. 127 CANNOT BE
CONSIDERED AS THE LEGAL BASIS FOR THE
REORGANIZATION OF THE BUREAU OF INTERNAL REVENUE;
REASON. — We can not consider E.O. No. 127 signed on January
30, 1987 as a legal basis for the reorganization of the BIR. E.O. No.
127 should be related to the second paragraph of Section 11
of Republic Act No. 6656. Section 11 provides inter alia: ". . . In the
case of the 1987 reorganization of the executive branch, all
departments and agencies which are authorized by executive orders
promulgated by the President to reorganize shall have ninety
days from the approval of this act within which to implement their
respective reorganization plans in accordance with the provisions of
this Act." Executive Order No. 127 was part of the 1987
reorganization contemplated under said provision. Obviously, it had
become stale by virtue of the expiration of the ninety days deadline
period. It can not thus be used as a proper basis for the
reorganization of the BIR. Nevertheless, as shown earlier, there are
other legal bases to sustain the authority of the President to issue
the questioned E.O. No. 132.
4. ID.; ID.; ID.; WHEN IS A REORGANIZATION REGARDED AS
VALID. — While the President's power to reorganize can not be
denied, this does not mean however that the reorganization itself is
properly made in accordance with law. Well-settled is the rule that
reorganization is regarded as valid provided it is pursued in good
faith. Thus, in Dario vs. Mison, this court has had the occasion to
clarify that: "As a general rule, a reorganization is carried out in
"good faith" if it is for the purpose of economy or to make
bureaucracy more efficient. In that event no dismissal or separation
actually occurs because the position itself ceases to exist. And in
that case the security of tenure would not be a Chinese Wall. Be that
as it may, if the abolition which is nothing else but a separation or
removal, is done for political reasons or purposely to defeat security
of tenure, or otherwise not in good faith, no valid abolition takes
place and whatever abolition is done is void ab initio. There is an
invalid abolition as where there is merely a change of nomenclature
of positions or where claims of economy are belied by the existence
of ample funds."
5. ID.; ID.; ID.; CIRCUMSTANCES CONSIDERED AS EVIDENCE
OF BAD FAITH IN THE REORGANIZATION OF THE BUREAU OF
INTERNAL REVENUE. — In this regard, it is worth mentioning that
Section 2 of R.A. No. 6656 lists down the circumstances evidencing
bad faith in the removal of employees as a result of the
reorganization. A reading of some of the provisions of the questioned
E.O. No. 132 clearly leads us to an inescapable conclusion that there
are circumstances considered as evidences of bad faith in the
reorganization of the BIR. Section 1.1.2 of said executive order
provides that: "1.1.2 The intelligence and Investigation Office and the
Inspection Service are abolished. An Intelligence and Investigation
Service is hereby created to absorb the same functions of the
abolished office and service. . . ." This provision is a clear illustration
of the circumstance mentioned in Section 2 (b) of R.A. No. 6656 that
an office is abolished and another one performing substantially the
same functions created. Another circumstance is the creation of
services and divisions in the BIR resulting to a significant increase in
the number of positions in the said bureau as contemplated in
paragraph (a) of Section 2 of R.A. No. 6656. Under Section 1.3 of
E.O. No. 132, the Information Systems Group has two newly created
Systems Services. Aside from this, six new divisions are also
created. Under Section 1.2.1, three more divisions of the
Assessment Service are formed. With these newly created offices,
there is no doubt that a significant increase of positions will
correspondingly follow. IHTASa
6. ID.; ID.; ID.; THE NON-REAPPOINTMENT OF THE PETITIONER
AS ASSISTANT COMMISSIONER VIOLATES SECTION 4
OF REPUBLIC ACT NO. 6656. — It is perceivable that the non-
reappointment of the petitioner as Assistant Commissioner violates
Section 4 of R.A. 6656. Under said provision, officers holding
permanent appointments are given preference for appointment to the
new positions in the approved staffing pattern comparable to their
former positions or in case there are not enough comparable
positions to positions next lower in rank. It is undeniable that
petitioner is a career executive officer who is holding a permanent
position. Hence, he should have been given preference for
appointment in the position of Assistant Commissioner. As claimed
by petitioner, Antonio Pangilinan who was one of those appointed as
Assistant Commissioner, "is an outsider of sorts to the bureau, not
having been an incumbent officer of the Bureau at the time of the
reorganization." We should not lose sight of the second paragraph of
Section 4 of R.A. No. 6656 which explicitly states that no new
employees shall be taken in until all permanent officers shall have
been appointed for permanent position. cTDECH
DECISION
TORRES, JR., J p:
Challenged in this petition is the validity of petitioner's removal from
service as Assistant Commissioner of the Excise Tax Service of the
Bureau of Internal Revenue. Incidentally, he questions Memorandum
Order No. 164 issued by the Office of the President, which provides
for the creation of "A Committee to Investigate the Administrative
Complaint Against Aquilino T. Larin, Assistant Commissioner,
Bureau of Internal Revenue" as well as the investigation made in
pursuance thereto, andAdministrative Order No. 101 dated
December 2, 1993 which found him guilty of grave misconduct in the
administrative charge and imposed upon him the penalty of dismissal
from office.
Likewise, petitioner seeks to assail the legality of Executive Order
No. 132, issued by President Ramos on October 26, 1993, which
provides for the "Streamlining of the Bureau of Internal Revenue,"
and of its implementing rules issued by the Bureau of Internal
Revenue, namely: a) Administrative Order No. 4-93, which provides
for the "Organizational Structure and Statement of General Functions
of Offices in the National Office" and b) Administrative Order No. 5-
93, which provides for "Redefining the Areas of Jurisdiction and
Renumbering of Regional And District Offices."
The antecedent facts of the instant case as succinctly related by the
Solicitor General are as follows:
On September 18, 1992, 1 a decision was rendered by the
Sandiganbayan convicting herein petitioner Aquilino T. Larin,
Revenue Specific Tax Officer, then Assistant Commissioner of the
Bureau of Internal Revenue and his co-accused (except Justino E.
Galban, Jr.) of the crimes of violation of Section 268 (4) of the
National Internal Revenue Code and Section 3 (e) of R.A. 3019 in
Criminal Cases Nos. 14208-14209, entitled "People of the
Philippines, Plaintiff vs. Aquilino T. Larin, Teodoro T. Pareno, Justino
E. Galban, Jr. and Potenciana N. Evangelista, Accused," the
dispositive portion of the judgment reads:
"WHEREFORE, judgment is now rendered in
Criminal Cases Nos. 14208 and 14209 convicting
accused Assistant Commissioner for Specific Tax
AQUILINO T. LARIN, Chief of the Alcohol Tax
Division TEODORO P. PARENO, and Chief of the
Revenue Accounting Division POTENCIANA M.
EVANGELISTA:
xxx xxx xxx
SO ORDERED."
The fact of petitioner's conviction was reported to the President of
the Philippines by the then Acting Finance Secretary Leong through
a memorandum dated June 4, 1993. The memorandum states, inter
alia:
'This is a report in the case of Assistant
Commissioner AQUILINO T. LARIN of the Excise
Tax Service, Bureau of Internal Revenue, a
presidential appointee, one of those convicted in
Criminal Case Nos. 14208-14209, entitled 'People
of the Philippines vs. Aquilino T. Larin, et. al.'
referred to the Department of Finance by the
Commissioner of Internal Revenue.
The cases against Pareno and Evangelista are
being acted upon by the Bureau of Internal
Revenue as they are non-presidential appointees.
xxx xxx xxx
It is clear from the foregoing that Mr. Larin has
been found beyond reasonable doubt to have
committed acts constituting grave misconduct.
Under the Civil Service Laws and Rules which
require only preponderance of evidence, grave
misconduct is punishable by dismissal.'
Acting by authority of the President, Sr. Deputy Executive Secretary
Leonardo A. Quisumbing issued Memorandum Order No. 164 dated
August 25, 1993 which provides for the creation of an Executive
Committee to investigate the administrative charge against herein
petitioner Aquilino T. Larin. It states thus:
"A Committee is hereby created to investigate the
administrative complaint filed against Aquilino
T. Larin, Assistant Commissioner, Bureau of
Internal Revenue, to be composed of:
Atty. Frumencio A. Lagustan — Chairman
 Assistant Executive Secretary for Legislation
Mr. Jose B. Alejandro — Member
Presidential Assistant
Atty. Jaime M. Maza — Member
Assistant Commissioner for Inspector Services
Bureau of Internal Revenue
The Committee shall have all the powers and
prerogatives of (an) investigating committee
under the Administrative Code of 1987 including
the power to summon witnesses, administer
oath or take testimony or evidence relevant to
the investigation by subpoena ad testificandum
and subpoena duces tecum.
xxx xxx xxx
The Committee shall convene immediately,
conduct the investigation in the most expeditious
manner, and terminate the same as soon as
practicable from its first scheduled date of hearing.
xxx xxx xxx"
Consequently, the Committee directed the petitioner to respond to
the administrative charge leveled against him through a letter dated
September 17, 1993, thus:
'Presidential Memorandum Order No. 164 dated
August 25, 1993, a xerox copy of which is hereto
attached for your ready reference, created an
Investigation Committee to look into the charges
against you which are also the subject of the
Criminal Cases No. 14208 and 14209 entitled
People of the Philippines vs. Aquilino T.Larin, et.
al. cdrep
The Committee has in its possession a certified
true copy of the Decision of the Sandiganbayan in
the above-mentioned cases.
Pursuant to Presidential Memorandum Order No.
164, you are hereby directed to file your position
paper on the aforementioned charges within seven
(7) days from receipt hereof . . .
Failure to file the required position paper shall be
considered as a waiver on your part to submit
such paper or to be heard, in which case, the
Committee shall deem the case submitted on the
basis of the documents and records at hand.'
In compliance, petitioner submitted a letter dated September 30,
1993 which was addressed to Atty. Frumencio A. Lagustan, the
Chairman of the Investigating Committee. In said latter, he asserts
that,
'The case being sub-judice, I may not, therefore,
comment on the merits of the issues involved for
fear of being cited in contempt of Court. This
position paper is thus limited to furnishing the
Committee pertinent documents submitted with
the Supreme Court and other tribunal which took
cognizance of the case in the past, as follows:
xxx xxx xxx
The foregoing documents readily show that I am
not administratively liable or criminally culpable of
the charges leveled against me, and that the
aforesaid cases are mere persecutions caused to
be filed and are being orchestrated by taxpayers
 who were prejudiced by multi-million peso
assessments I caused to be issued against them
in my official capacity as Assistant Commissioner,
Excise Tax Office of the Bureau of Internal
Revenue.'
In the same letter, petitioner claims that the administrative complaint
against him is already barred: a) on jurisdictional ground as the
Office of the Ombudsman had already taken cognizance of the case
and had caused the filing only of the criminal charges against him, b)
by res judicata, c) by double jeopardy, and d) because to proceed
with the case would be redundant, oppressive and a plain
persecution against him.
Meanwhile, the President issued the challenged Executive Order No.
132 dated October 26, 1993 which mandates for the streamlining of
the Bureau of Internal Revenue. Under said order, some positions
and functions are either abolished, renamed, decentralized or
transferred to other offices, while other offices are also created. The
Excise Tax Service or the Specific Tax Service, of which petitioner
was the Assistant Commissioner, was one of those offices that was
abolished by said executive order.
The corresponding implementing rules of Executive Order No. 132,
namely, Revenue Administrative Orders Nos. 4-93 and 5-93, were
subsequently issued by the Bureau of Internal Revenue.
On October 27, 1993, or one day after the promulgation of Executive
Order No. 132, the President appointed the following as BIR
Assistant Commissioners:
1. Bernardo A. Frianeza
2. Dominador L. Galura
3. Jaime D. Gonzales
4. Lilia C. Guillermo
5. Rizalina S . Magalona
6. Victorino C. Mamalateo
7. Jaime M. Maza
8. Antonio N. Pangilinan
9. Melchor S. Ramos
10. Joel L. Tan-Torres
Consequently, the President, in the assailed Administrative Order
No. 101 dated December 2, 1993, found petitioner guilty of grave
misconduct in the administrative charge and imposed upon him the
penalty of dismissal with forfeiture of his leave credits and retirement
benefits including disqualification for reappointment in the
government service.
Aggrieved, petitioner filed directly with this Court the instant petition
on December 13, 1993 to question basically his alleged unlawful
removal from office.
On April 17, 1996 and while the instant petition is pending, this Court
set aside the conviction of petitioner in Criminal Case Nos. 14208
and 14209.
In his petition, petitioner challenged the authority of the President to
dismiss him from office. He argued that in so far as presidential
appointees who are Career Executive Service Officers are
concerned, the President exercises only the power of control not the
power to remove. He also averred that the administrative
investigation conducted under Memorandum Order No. 164 is void
as it violated his right to due process. According to him, the letter of
the Committee dated September 17, 1993 and his position paper
dated September 30, 1993 are not sufficient for purposes of
complying with the requirements of due process. He alleged that he
was not informed of the administrative charges leveled against him
nor was he given official notice of his dismissal.
Petitioner likewise claimed that he was removed as a result of the
reorganization made by the Executive Department in the BIR
pursuant to Executive Order No. 132. Thus, he assailed
said Executive Order No. 132 and its implementing rules, namely,
Revenue Administrative Orders 4-93 and 5-93 for being ultra vires.
He claimed that there is yet no law enacted by Congress which
authorizes the reorganization by the Executive Department of
executive agencies, particularly the Bureau of Internal Revenue. He
said that the reorganization sought to be effected by the Executive
Department on the basis of E.O. No. 132 is tainted with bad faith in
apparent violation of Section 2 of R.A. 6656, otherwise known as the
Act Protecting the Security of Tenure of Civil Service Officers and
Employees in the Implementation of Government Reorganization.
On the other hand, respondents contended that since petitioner is a
presidential appointee, he falls under the disciplining authority of the
President. They also contended that E.O. No. 132 and its
implementing rules were validly issued pursuant to Sections 48 and
62 of Republic Act No. 7645. Apart from this, the other legal bases of
E.O. No. 132 as stated in its preamble are Section 63 of E.O. No.
127 (Reorganizing the Ministry of Finance), and Section 20, Book III
of E.O. No. 292, otherwise known as the Administrative Code of
1987. In addition, it is clear that in Section 11 of R.A. No. 6656 future
reorganization is expressly contemplated and nothing in said law that
prohibits subsequent reorganization through an executive order.
Significantly, respondents clarified that petitioner was not dismissed
by virtue of EO 132. Respondents claimed that he was removed from
office because he was found guilty of grave misconduct in the
administrative cases filed against him.
The ultimate issue to be resolved in the instant case falls on the
determination of the validity of petitioner's dismissal from office.
Incidentally, in order to resolve this matter, it is imperative that We
consider these questions: a) Who has the power to discipline the
petitioner?, b) Were the proceedings taken pursuant
to Memorandum Order No. 164 in accord with due process?, c) What
is the effect of petitioner's acquittal in the criminal case to his
administrative charge?, d) Does the President have the power to
reorganize the BIR or to issue the questioned E.O. NO. 132?, and e)
Is the reorganization of BIR pursuant to E.O. No. 132 tainted with
bad faith?
At the outset, it is worthy to note that the position of Assistant
Commissioner of the BIR is part of the Career Executive
Service. 2 Under the law, 3 Career Executive Service officers,
namely, Undersecretary, Assistant Secretary, Bureau Director,
Assistant Bureau Director, Regional Director, Assistant Regional
Director, Chief of Department Service and other officers of equivalent
rank as may be identified by the Career Executive Service Board,
are all appointed by the President. Concededly, petitioner was
appointed as Assistant Commissioner in January, 1987 by then
President Aquino. Thus, petitioner is a presidential appointee who
belongs to career service of the Civil Service. Being a presidential
appointee, he comes under the direct disciplining authority of the
President. This is in line with the well settled principle that the "power
to remove is inherent in the power to appoint" conferred to the
President by Section 16, Article VII of the Constitution. Thus, it is
ineluctably clear that Memorandum Order No. 164, which created a
committee to investigate the administrative charge against petitioner,
was issued pursuant to the power of removal of the President. This
power of removal, however, is not an absolute one which accepts no
reservation. It must be pointed out that petitioner is a career service
officer. Under the Administrative Code of 1987, career service is
characterized by the existence of security of tenure, as contra-
distinguished from non-career service whose tenure is co-terminus
with that of the appointing authority or subject to his pleasure, or
limited to a period specified by law or to the duration of a particular
project for which purpose the employment was made. As a career
service officer, petitioner enjoys the right to security of tenure. No
less than the 1987 Constitution guarantees the right of security of
tenure of the employees of the civil service. Specifically, Section 36
of P.D. No. 807, as amended, otherwise known as Civil Service
Decree of the Philippines, is emphatic that career service officers
and employees who enjoy security of tenure may be removed only
for any of the causes enumerated in said law. In other words, the fact
that petitioner is a presidential appointee does not give the
appointing authority the license to remove him at will or at his
pleasure for it is an admitted fact that he is likewise a career service
officer who under the law is the recipient of tenurial protection, thus,
may only be removed for a cause and in accordance with procedural
due process. cdasia
Was petitioner then removed from office for a legal cause under a
valid proceeding?
Although the proceedings taken complied with the requirements of
procedural due process, this Court, however, considers that
petitioner was not dismissed for a valid cause.
It should be noted that what precipitated the creation of the
investigative committee to look into the administrative charge against
petitioner is his conviction by the Sandiganbayan in Criminal Case
Nos. 14208 and 14209. As admitted by the respondents, the
administrative case against petitioner is based on the
Sandiganbayan Decision of September 18, 1992. Thus, in
the Administrative Order No. 101 issued by Senior Deputy Executive
Secretary Quisumbing which found petitioner guilty of grave
misconduct, it clearly states that:
"This pertains to the administrative charge against
Assistant Commissioner Aquilino T. Larin of the
Bureau of Internal Revenue, for grave misconduct
by virtue of a Memorandum signed by Acting
Secretary Leong of the Department of Finance, on
the basis of a decision handed down by the Hon.
Sandiganbayan convicting Larin, et. al. in Criminal
Case Nos. 14208 and 14209." 4
In a nutshell, the criminal cases against petitioner refer to his alleged
violation of Section 268 (4) of the National Internal Revenue Code
and of Section 3 (e) of R.A. No. 3019 as a consequence of his act of
favorably recommending the grant of tax credit to Tanduay Distillery,
Inc. The pertinent portion of the judgment of the Sandiganbayan
reads:
"As above pointed out, the accused had conspired
in knowingly preparing false memoranda and
certification in order to effect a fraud upon taxes
due to the government. By their separate acts
which had resulted in an appropriate tax credit of
P180,701,682.00 in favor of Tanduay. The
government had been defrauded of a tax revenue
— for the full amount, if one is to look at the
availments or utilization thereof (Exhibits 'AA' to
'AA-31-a'), or for a substantial portion thereof
(P73,000,000.00) if we are to rely on the letter of
Deputy Commissioner Eufracio D. Santos
(Exhibits '21' for all the accused).
As pointed out above, the confluence of acts and
omissions committed by accused Larin, Pareno
and Evangelista adequately prove conspiracy
among them for no other purpose than to bring
about a tax credit which Tanduay did not deserve.
These misrepresentations as to how much
Tanduay had paid in ad valorem taxes obviously
constituted a fraud of tax revenue of the
government . . ." 5
However, it must be stressed at this juncture that the conviction of
petitioner by the Sandiganbayan was set aside by this Court in our
decision promulgated on April 17, 1996 in G.R. Nos. 108037-38 and
107119-20. We specifically ruled in no uncertain terms that: a)
petitioner can not be held negligent in relying on the certification of a
co-equal unit in the BIR, b) it is not incumbent upon Larin to go
beyond the certification made by the Revenue Accounting Division
that Tanduay Distillery, Inc. had paid the ad valorem taxes, c) there
is nothing irregular or anything false in Larin's marginal note on the
memorandum addressed to Pareno, the Chief of Alcohol Tax
Division who was also one of the accused, but eventually acquitted,
in the said criminal cases, and d) there is no proof of actual
agreement between the accused, including petitioner, to commit the
illegal acts charged. We are emphatic in our resolution in said cases
that there is nothing "illegal with the acts committed by the
petitioner(s)." We also declare that "there is no showing that
petitioner(s) had acted irregularly, or performed acts outside of his
(their) official functions." Significantly, these acts which We
categorically declare to be not unlawful and improper in G.R. Nos.
108037-38 and G.R. Nos. 107119-20 are the very same acts for
which petitioner is held to be administratively responsible. Any
charge of malfeasance or misfeasance on the part of the petitioner is
clearly belied by our conclusion in said cases. In the light of this
decisive pronouncement, We see no reason for the administrative
charge to continue — it must, thus, be dismissed.
We are not unaware of the rule that since administrative cases are
independent from criminal actions for the same act or omission, the
dismissal or acquittal of the criminal charge does not foreclose the
institution of administrative action nor carry with it the relief from
administrative liability. 6 However, the circumstantial setting of the
instant case sets it miles apart from the foregoing rule and placed it
well within the exception. Corollarily, where the very basis of the
administrative case against petitioner is his conviction in the criminal
action which was later on set aside by this Court upon a categorical
and clear finding that the acts for which he was administratively held
liable are not unlawful and irregular, the acquittal of the petitioner in
the criminal case necessarily entails the dismissal of the
administrative action against him, because in such a case, there is
no more basis nor justifiable reason to maintain the administrative
suit.
On the aspect of procedural due process, suffice it to say that
petitioner was given every chance to present his side. The rule is
well settled that the essence of due process in administrative
proceedings is that a party be afforded a reasonable opportunity to
be heard and to submit any evidence he may have in support of his
defense. 7 The records clearly show that on October 1, 1993
petitioner submitted his letter-response dated September 30, 1993 to
the administrative charge filed against him. Aside from his letter, he
also submitted various documents attached as annexes to his letter,
all of which are evidences supporting his defense. Prior to this, he
received a letter dated September 17, 1993 from the Investigation
Committee requiring him to explain his side concerning the charge. It
can not therefore be argued that petitioner was denied of due
process.
Let us now examine Executive Order No. 132.
As stated earlier, with the issuance of Executive Order No. 132,
some of the positions and offices, including the office of Excise Tax
Services of which petitioner was the Assistant Commissioner, were
abolished or otherwise decentralized. Consequently, the President
released the list of appointed Assistant Commissioners of the BIR.
Apparently, petitioner was not included.
Initially, it is argued that there is no law yet which empowers the
President to issue E.O. No. 132 or to reorganize the BIR.
We do not agree.
Under its preamble, E.O. No. 132 lays down the legal bases of its
issuance, namely: a) Section 48 and 62 of R.A. No. 7645, b) Section
63 of E.O. No. 127, and c) Section 20, Book III of E.O. No. 292.
Section 48 of R.A. 7645 provides that:
"Sec. 48. Scaling Down and Phase Out of
Activities of Agencies Within the Executive
Branch. — The heads of departments, bureaus
and offices and agencies are hereby directed to
identify their respective activities which are no
longer essential in the delivery of public services
and which may be scaled down, phased out or
abolished, subject to civil service rules and
regulations. . . . Actual scaling down, phasing out
or abolition of the activities shall be effected
pursuant to Circulars or Orders issued for the
purpose by the Office of the President." (emphasis
ours)
Said provision clearly mentions the acts of "scaling down, phasing
out and abolition" of offices only and does not cover the creation of
offices or transfer of functions. Nevertheless, the act of creating and
decentralizing is included in the subsequent provision of Section 62,
which provides that:
"Sec. 62. Unauthorized organizational changes. —
Unless otherwise created by law or directed by the
President of the Philippines, no organizational unit
or changes in key positions in any department or
agency shall be authorized in their respective
organization structures and be funded from
appropriations by this Act." (emphasis ours)
The foregoing provision evidently shows that the President is
authorized to effect organizational changes including the creation of
offices in the department or agency concerned.
The contention of petitioner that the two provisions are riders
deserves scant consideration. Well settled is the rule that every law
has in its favor the presumption of constitutionality. 8 Unless and
until a specific provision of the law is declared invalid and
unconstitutional, the same is valid and binding for all intents and
purposes.
Another legal basis of E.O. No. 132 is Section 20, Book III of E.O.
No. 292 which states:
"Sec. 20. Residual Powers. — Unless Congress
provides otherwise, the President shall exercise
such other powers and functions vested in the
President which are provided for under the
laws and which are not specifically enumerated
above or which are not delegated by the President
in accordance with law." (emphasis ours)
This provision speaks of such other powers vested in the President
under the law. What law then which gives him the power to
reorganize? It is Presidential Decree No. 1772 9which
amended Presidential Decree No. 1416. These decrees expressly
grant the President of the Philippines the continuing authority to
reorganize the national government, which includes the power to
group, consolidate bureaus and agencies, to abolish offices, to
transfer functions, to create and classify functions, services and
activities and to standardize salaries and materials. The validity of
these two decrees are unquestionable. The 1987 Constitution clearly
provides that "all laws, decrees, executive orders, proclamations,
letters of instructions and other executive issuances not inconsistent
with this Constitution shall remain operative until amended, repealed
or revoked." 10 So far, there is yet no law amending or repealing
said decrees. Significantly, the Constitution itself recognizes future
reorganizations in the government as what is revealed inSection 16
of Article XVIII, thus:
"Sec. 16. Career civil service employees
separated from service not for cause but as a
result of the . . . reorganization following the
ratification of this Constitutionshall be entitled to
appropriate separation pay . . ."
However, We can not consider E.O. No. 127 signed on January 30,
1987 as a legal basis for the reorganization of the BIR. E.O. No. 127
should be related to the second paragraph of Section 11 of Republic
Act No. 6656.
Section 11 provides inter alia:
"xxx xxx xxx
In the case of the 1987 reorganization of the
executive branch, all departments and agencies
which are authorized by executive orders
promulgated by the President to reorganize shall
have ninety days from the approval of this act
within which to implement their respective
reorganization plans in accordance with the
provisions of this Act." (emphasis ours)
Executive Order No. 127 was part of the 1987 reorganization
contemplated under said provision. Obviously, it had become stale
by virtue of the expiration of the ninety day deadline period. It can not
thus be used as a proper basis for the reorganization of the BIR.
Nevertheless, as shown earlier, there are other legal bases to
sustain the authority of the President to issue the questioned E.O.
No. 132.
While the President's power to reorganize can not be denied, this
does not mean however that the reorganization itself is properly
made in accordance with law. Well-settled is the rule that
reorganization is regarded as valid provided it is pursued in good
faith. Thus, in Dario vs. Mison, this Court has had the occasion to
clarify that:
"As a general rule, a reorganization is carried out
in 'good faith' if it is for the purpose of economy or
to make bureaucracy more efficient. In that event
no dismissal or separation actually occurs
because the position itself ceases to exist. And in
that case the security of tenure would not be a
Chinese wall. Be that as it may, if the abolition
which is nothing else but a separation or removal,
is done for political reasons or purposely to defeat
security of tenure, or otherwise not in good faith,
no valid abolition takes place and whatever
abolition is done is void ab initio. There is an
invalid abolition as where there is merely a change
of nomenclature of positions or where claims of
economy are belied by the existence of ample
funds." 11
In this regard, it is worth mentioning that Section 2 of R. A. No. 6656
lists down the circumstances evidencing bad faith in the removal of
employees as a result of the reorganization, thus:
Sec. 2. No officer or employee in the career
service shall be removed except for a valid cause
and after due notice and hearing. A valid cause for
removal exists when, pursuant to a bona fide
reorganization, a position has been abolished or
rendered redundant or there is a need to merge,
divide, or consolidate positions in order to meet
the exigencies of the service, or other lawful
causes allowed by the Civil Service Law. The
existence of any or some of the following
circumstances may be considered as evidence of
bad faith in the removals made as a result of the
reorganization, giving rise to a claim for
reinstatement or reappointment by an aggrieved
party:
a) Where there is a significant increase in the
number of positions in the new staffing pattern of
the department or agency concerned;
b) Where an office is abolished and another
performing substantially the same functions is
created;
c) Where incumbents are replaced by those less
qualified in terms of status of appointment,
performance and merit;
d) Where there is a reclassification of offices in the
department or agency concerned and the
reclassified offices perform substantially the same
functions as the original offices;
e) Where the removal violates the order of
separation provided in Section 3 hereof."
A reading of some of the provisions of the questioned E.O. No. 132
clearly leads us to an inescapable conclusion that there are
circumstances considered as evidences of bad faith in the
reorganization of the BIR. cdrep
Section 1.1.2 of said executive order provides that:
 "1.1.2 The Intelligence and Investigation Office
and the Inspection Service are abolished. An
Intelligence and Investigation Service is hereby
created to absorb thesame functions of the
abolished office and service. . . ." (emphasis ours)
This provision is a clear illustration of the circumstance mentioned in
Section 2 (b) of R.A. No. 6656 that an office is abolished and another
one performing substantially the same function is created.
Another circumstance is the creation of services and divisions in the
BIR resulting to a significant increase in the number of positions in
the said bureau as contemplated in paragraph (a) of Section 2
of R.A. No. 6656. Under Section 1.3 of E.O. No. 132, the Information
Systems Group has two newly created Systems Services. Aside
from this, six new divisions are also created. Under Section 1.2.1,
three more divisions of the Assessment Service are formed. With
these newly created offices, there is no doubt that a significant
increase of positions will correspondingly follow.
IN VIEW OF THE FOREGOING, the petition is granted, and
petitioner is hereby reinstated to his position as Assistant
Commissioner without loss of seniority rights and shall be entitled to
full backwages from the time of his separation from service until
actual reinstatement unless, in the meanwhile, he would have
reached the compulsory retirement age of sixty-five years in which
case, he shall be deemed to have retired at such age and entitled
thereafter to the corresponding retirement benefits.
SO ORDERED.
Narvasa, C .J ., Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug,
Kapunan, Mendoza, Francisco, Hermosisima, Jr. and Panganiban,
JJ ., concur.
Regalado, J ., is on leave.

Furthermore, it is perceivable that the non-reappointment of the

petitioner as Assistant Commissioner violates Section 4 of R.A. No.
6656. Under said provision, officers holding permanent appointments
are given preference for appointment to the new positions in the
approved staffing pattern comparable to their former positions or in
case there are not enough comparable positions to positions next
lower in rank. It is undeniable that petitioner is a career executive
officer who is holding a permanent position. Hence, he should have
been given preference for appointment in the position of Assistant
Commissioner. As claimed by petitioner, Antonio Pangilinan who
was one of those appointed as Assistant Commissioner, "is an
outsider of sorts to the Bureau, not having been an incumbent officer
of the Bureau at the time of the reorganization." We should not lose
sight of the second paragraph of Section 4 of R.A. No. 6656 which
explicitly states that no new employees shall be taken in until all
permanent officers shall have been appointed for permanent
position.
 EN BANC SALVADOR M. MISON, COMMISSIONER,
BUREAU OF CUSTOMS, respondent.
[G.R. No. 81954. August 8, 1989.]
[G.R. No. 83737. August 8, 1989]
CESAR Z. DARIO, petitioner, vs. HON.
SALVADOR M. MISON, HON. VICENTE JAYME BENEDICTO L. AMASA and WILLIAM S.
and HON. CATALINO MACARAIG, JR., in their DIONISIO, petitioners, vs. PATRICIA A. STO.
respective capacities as Commissioner of Customs, TOMAS, in her capacity as Chairman of the Civil
Secretary of Finance, and Executive Service Commission and SALVADOR MISON, in his
Secretary, respondents. capacity as Commissioner of the Bureau of
Customs, respondents.
[G.R. No. 81967 August 8, 1989]
[G.R. No. 85310. August 8, 1989.]
VICENTE A. FERIA, JR., petitioner, vs. HON.
SALVADOR M. MISON, HON. VICENTE JAYME, SALVADOR M. MISON, in his capacity as
and HON. CATALINO MACARAIG, JR., in their Commissioner of Customs, petitioner, vs. CIVIL
respective capacities as Commissioner of Customs, SERVICE COMMISSION, ABACA, SISINIO T.,
Secretary of Finance, and Executive ABAD, ROGELIO C., ABADIANO, JOSE P.,
Secretary, respondents. ABCEDE, NEMECIO C., ABIOG, ELY F.,
ABLAZA, AURORA M., AGBAYANI, NELSON I.,
[G.R. No. 82023 August 8, 1989] AGRES, ANICETO, AGUILAR, FLOR,
AGUILUCHO, MA. TERESA R., AGUSTIN,
BONIFACIO T., ALANO, ALEX P., ALBA,
ADOLFO CASARENO, PACIFICO LAGLEVA, MAXIMO F. JR., ALBANO, ROBERT B.,
JULIAN C. ESPIRITU, DENNIS A. AZARRAGA, ALCANTARA, JOSE G., ALMARIO, RODOLFO
RENATO DE JESUS, NICASIO C. GAMBOA, F., ALVEZ, ROMUALDO R., AMISTAD, RUDY
CORAZON RALLOS NIEVES, FELICITACION R. M., AMOS, FRANCIS F., ANDRES, RODRIGO V.,
GELUZ, LEODEGARIO H. FLORESCA, SUBAER ANGELES, RICARDO S., ANOLIN, MILAGROS
PACASUM, ZENAIDA LANARIA, JOSE B. H., AQUINO, PASCASIO E., ARABE, MELINDA
ORTIZ, GLICERIO R. DOLAR, CORNELIO M., ARCANGEL, AGUSTIN S., JR., ARPON,
NAPA, PABLO B. SANTOS, FERMIN ULPIANO U., JR., ARREZA, ARTEMIO M., JR.,
RODRIGUEZ, DALISAY BAUTISTA, ARROJO, ANTONIO P., ARVISU, ALEXANDER
LEONARDO JOSE, ALBERTO LONTOK, S., ASCAÑO, ANTONIO T., ASLAHON, JULAHON
PORFIRIO TABINO, JOSE BARREDO, P., ASUNCION, VICTOR R., ATANGAN, LORNA
ROBERTO ARNALDO, ESTER TAN, PEDRO S., ATIENZA, ALEXANDER R., BACAL,
BAKAL, ROSARIO DAVID, RODOLFO AFUANG, URSULINO C., BAÑAGA, MARLOWE, Z.,
LORENZO CATRE, LEONCIA CATRE, BANTA, ALBERTO T., BARREDO, JOSE B.,
ROBERTO BARROS, VICTOR C., BARTOLOME, FELIPE A.,
ABADA,petitioners, vs. COMMISSIONER BAYSAC, REYNALDO S., BELENO, ANTONIO B.,
BERNARDO, ROMEO D., BERNAS, MARCIANO
S., BOHOL, AUXILIADOR G., BRAVO, VICTOR
M., BULEG, BALILIS R., CALNEA, MERCEDES
M., CALVO, HONESTO G., CAMACHO, CARLOS
V., CAMPOS, RODOLFO C., CAPULONG,
RODRIGO G., CARINGAL, GRACIA Z., CARLOS,
LORENZO B., CARRANTO, FIDEL U.,
CARUNGCONG, ALFREDO M., CASTRO,
PATRICIA J., CATELO, ROGELIO B., CATURLA,
MANUEL B., CENIZAL, JOSEFINA F., CINCO,
LUISITO, CONDE, JOSE C., JR., CORCUERA,
FIDEL S., CORNETA, VICENTE S., CORONADO,
RICARDO S., CRUZ, EDUARDO S., CRUZ
EDILBERTO A., CRUZ, EFIGENIA B.,
CRUZADO, MARCIAL C., CUSTODIO,
RODOLFO M., DABON, NORMA M., DALINDIN,
EDNA MAE D., DANDAL, EDEN F.,
DATUHARON, SATA A., DAZO, GODOFREDO L.,
DE CASTRO, LEOPAPA, DE GUZMAN,
ANTONIO A., DE GUZMAN, RENATO E., DE LA
CRUZ, AMADO A., JR., DE LA CRUZ,
FRANCISCO C., DE LA PENA, LEONARDO, DEL
CAMPO, ORLANDO, DEL RIO, MAMERTO P.,
JR., DEMESA, WILHELMINA T., DIMAKUTA,
SALIC L., DIZON, FELICITAS A., DOCTOR,
HEIDY M., DOLAR, GLICERIO R., DOMINGO,
NICANOR J., DOMINGO, PERFECTO V., JR.,
DUAY, JUANA G., DYSANGCO, RENATO F.,
EDILLOR, ALFREDO P., ELEVAZO,
LEONARDO A., ESCUYOS, MANUEL M., JR.,
ESMERIA, ANTONIO E., ESPALDON, MA.
LOURDES H., ESPINA, FRANCO A., ESTURCO,
RODOLFO C., EVANGELINO, FERMIN I.,
FELIX, ERNESTO G., FERNANDEZ, ANDREW
M., FERRAREN, ANTONIO C., FERRERA,
WENCESLAO A., FRANCISCO, PELAGIO S., JR.,
FUENTES, RUDY L., GAGALANG, RENATO V.,
GALANG, EDGARDO R., GAMBOA, ANTONIO
C., GAN, ALBERTO R., GARCIA, GILBERT M.,
GARCIA, EDNA V., CARCIA, JUAN L.,
GAVIOLA, LILIAN V., GEMPARO, SEGUNDINA
G., GOBENCIONG, FLORDELIZ B., GRATE,
FREDERICK R., GREGORIO, LAURO P.,
GUARTICO, AMMON H., GUIANG, MYRNA N.,
GUINTO, DELFIN C., HERNANDEZ, LUCAS A.,
HONRALES, LORETO N., HUERTO, LEOPOLDO
H., HULAR, LANNYROSS E., IBAÑEZ, ESTER C.,
ILAGAN, HONORATO C., INFANTE,
REYNALDO C., ISAIS, RAY C., ISMAEL, HADJI
AKRAM B., JANOLO, VIRGILIO M., JAVIER,
AMADOR L., JAVIER, ROBERTO S., JAVIER,
WILLIAM R., JOVEN, MEMIA A., JULIAN,
REYNALDO V., JUMAMOY, ABUNDIO A.,
JUMAQUIAO, DOMINGO F., KAINDOY,
PASCUAL B., JR., KOH, NANIE G., LABILLES,
ERNESTO S., LABRADOR, WILFREDO M.,
LAGA, BIENVENIDO M., LAGLEVA, PACIFICO
Z., LAGMAN, EVANGELINE G., LAMPONG,
WILFREDO G., LANDICHO, RESTITUTO A.,
LAPITAN, CAMILO M., LAURENTE,
REYNALDO A., LICARTE, EVARISTO R., LIPIO,
VICTOR O., LITTAUA, FRANKLIN Z., LOPEZ,
MELENCIO L., LUMBA, OLIVIA R., MACAISA,
BENITO T., MACAISA, ERLINDA C., MAGAT,
ELPIDIO, MAGLAYA, FERNANDO P.,
MALABANAN, ALFREDO C., MALIBIRAN,
ROSITA D., MALIJAN, LAZARO V., MALLI,
JAVIER M., MANAHAN, RAMON S., MANUEL,
ELPIDIO R., MARAVILLA, GIL B., MARCELO,
GIL C., MARIÑAS, RODOLFO V., MAROKET,
JESUS C., MARTIN, NEMENCIO A., MARTINEZ,
ROMEO M., MARTINEZ, ROSELINA M.,
MATIBAG, ANGELINA G., MATUGAS,
ERNESTO T., MATUGAS, FRANCISCO T.,
MAYUGA, PORTIA E., MEDINA, NESTOR M.,
MEDINA, ROLANDO S., MENDAVIA, AVELINO
I., MENDOZA, POTENCIANO G., MIL, RAY M.,
MIRAVALLES, ANASTACIA L., MONFORTE,
EUGENIO, JR., G., MONTANO, ERNESTO F.,
MONTERO, JUAN M. III., MORALDE,
ESMERALDO B., JR., MORALES, CONCHITA
D.L., MORALES, NESTOR P., MORALES,
SHIRLEY S., MUNAR, JUANITA L., MUÑOZ,
VICENTE R., MURILLO, MANUEL M., NACION,
PEDRO R., NAGAL, HENRY N., NAPA,
CORNELIO B., NAVARRO, HENRY L., NEJAL,
FREDRICK E., NICOLAS, REYNALDO S.,
NIEVES, RUFINO A., OLAIVAR, SEBASTIAN T.,
OLEGARIO, LEO Q., ORTEGA, ARLENE R.,
ORTEGA, JESUS R., OSORIO, ABNER S., PAPIO,
FLORENTINO T. II, PASCUA, ARNULFO A.,
PASTOR, ROSARIO, PELAYO, ROSARIO L.,
PEÑA, AIDA C., PEREZ, ESPERIDION B., PEREZ,
JESUS BAYANI M., PRE, ISIDRO A.,
PRUDENCIADO, EULOGIA S., PUNZALAN,
LAMBERTO N., PURA, ARNOLD T., QUINONES,
EDGARDO I., QUINTOS, AMADEO C., JR.,
QUIRAY, NICOLAS C., RAMIREZ, ROBERTO P.,
RAÑADA, RODRIGO C., RARAS, ANTONIO A.,
RAVAL, VIOLETA V., RAZAL, BETTY R.,
REGALA, PONCE F., REYES, LIBERATO R.,
REYES, MANUEL E., REYES, NORMA Z.,
REYES, TELESFORO F., RIVERA, ROSITA L.,
ROCES, ROBERTO V., ROQUE, TERESITA S.,
ROSANES, MARILOU M., ROSETE, ADAN I.,
RUANTO, REY CRISTO C., JR., SABLADA,
PASCASIO G., SALAZAR SILVERIA S.,
SALAZAR, VICTORIA A., SALIMBACOD,
PERLITA C., SALMINGO, LOURDES M.,
SANTIAGO, EMELITA B., SATINA, PORFIRIO
C., SEKITO, COSME B., JR., SIMON, RAMON P.,
SINGSON, MELECIO C., SORIANO, ANGELO L.,
SORIANO, MAGDALENA R., SUMULONG,
ISIDRO L., JR., SUNICO, ABELARDO T., TABIJE,
EMMA B., TAN, RUDY GOROSPE, TAN, ESTER,
S., TAN, JULITA S., TECSON, BEATRIZ B.,
TOLENTINO, BENIGNO A., TURINGAN,
ENRICO T., JR., UMPA, ALI A., VALIC, LUCIO
E., VASQUEZ, NICANOR B., VELARDE,
EDGARDO C., VERA, AVELINO A., VERAME,
OSCAR E., VIADO, LILIAN T., VIERNES,
NAPOLEON K., VILLALON, DENNIS A.,
VILLAR, LUZ L., VILLALUZ, EMELITO V.,
ZATA, ANGEL A., JR., ACHARON, CRISTETO,
ALBA, RENATO B., AMON, JULITA C.,
AUSTRIA, ERNESTO C., CALO, RAYMUNDO M.,
CENTENO, BENJAMIN R., DE CASTRO,
LEOPAPA C., DONATO, ESTELITA P., DONATO,
FELIPE S., FLORES, PEDRITO S., GALAROSA,
RENATO, MALAWI, MAUYAG, MONTENEGRO,
FRANCISCO M., OMEGA, PETRONILO T.,
SANTOS, GUILLERMO F., TEMPLO, CELSO,
VALDERAMA, JAIME B., and VALDEZ, NORA
M., respondents.
[G.R. No. 85335. August 8, 1989.]
FRANKLIN Z. LITTAUA, ADAN I. ROSETE,
FRANCISCO T. MATUGAS, MA. J. ANGELINA G.
MATIBAG, LEODEGARDIO H. FLORESCA,
LEONARDO A. DELA PEÑA, ABELARDO T.
SUNICO, MELENCIO L. LOPEZ, NEMENCIO A.
MARTIN, RUDY M. AMISTAD, ERNESTO T.
MATUGAS, SILVERIA S. SALAZAR, LILLIAN V.
GAVIOLA, MILAGROS ANOLIN, JOSE B.
ORTIZ, ARTEMIO ARREZA, JR., GILVERTO M.
GARCIA, ANTONIO A. RARAS, FLORDELINA B.
GOBENCIONG, ANICETO AGRES, EDGAR Y.
QUINONES, MANUEL B. CATURLA, ELY F.
ABIOG, RODRIGO C. RAÑADA, LAURO
GREGORIO, ALBERTO I. GAN, EDGARDO
GALANG, RAY C. ISAIS, NICANOR B.
VASQUEZ, MANUEL ESCUYOS, JR., ANTONIO
B. BELENO, ELPIO R. MANUEL, AUXILIADOR
C. BOHOL, LEONARDO ELEVAZO, VICENTE S.
CORNETA, petitioners, vs. COM. SALVADOR M.
MISON/BUREAU OF CUSTOMS and the CIVIL
SERVICE COMMISSION, respondents.
 [G.R. No. 86241. August 8, 1989.]
SALVADOR M. MISON, in his capacity as
Commissioner of Customs, petitioner, vs. CIVIL
SERVICE COMMISSION, SENEN S.
DIMAGUILA, ROMEO P. ARABE, BERNARDO S.
QUINTONG, GREGORIO P. REYES, and
ROMULO C. BADILLO, respondents.
SYLLABUS
MELENCIO-HERRERA, J., dissenting opinion:
1. ADMINISTRATIVE LAW; CIVIL SERVICE ACT; REMOVAL OR
SUSPENSION OF CIVIL SERVICE OFFICER MUST BE FOR CAUSE;
"FOR CAUSE" CONSTRUED. — The canon for the removal or suspension
of a civil service officer or employee is that it must be FOR CAUSE. That
means "a guarantee of both procedural and substantive due process.
Basically, procedural due process would require that suspension or dismissal
come only after notice and hearing. Substantive due process would require
that suspension or dismissal be 'for cause'.
2. ID.; ID.; ID.; GUARANTEE ENSHRINED IN THE CONSTITUTION.
— The guarantee of removal FOR CAUSE is enshrined in Article IX-B,
Section 2(3) of the 1987 Constitution, which states that "No officer or
employee of the civil service shall be removed or suspended except FOR
CAUSE provided by law."
3. REMEDIAL LAW; SUPREME COURT; JUDGMENT; OBITER
DICTUM, DEFINED. — An obiter dictum or dictum has been defined as a
remark or opinion uttered, by the way. It is a statement of the court
concerning a question which was not directly before it (In re Hess, 23 A. 2d.
298, 301, 20 N.J. Misc. 12). It is language unnecessary to a decision, (a)
ruling on an issue not raised, or (an) opinion of a judge which does not
embody the resolution or determination of the court, and is made without
argument or full consideration of the point (Lawson v. US, 176 F2d 49, 51,
85 U.S. App. D.C. 167). It is an expression of opinion by the court or judge
on a collateral question not directly involved, (Crescent Ring Co. v. Traveler's
Indemnity Co. 132 A. 106, 107, 102 N.J. Law 85) or not necessary for the
decision (Du Bell v. Union Central Life Ins. Co., 29, So. 2d 709, 712; 211
La. 167).
4. ID.; ID.; ID.; RESOLUTION OF THE ULTIMATE ISSUES, NOT AN
OBITER. — The ruling of the Court, therefore, on the Constitutional issues
presented, particularly, the lapse of the period mandated by Proclamation No.
3, and the validity of EO 127, cannot be said to be mere "obiter." They were
ultimate issues directly before the Court, expressly decided in the course of
the consideration of the case, so that any resolution thereon must be
considered as authoritative precedent, and not a mere dictum (See Valli v.
US, 94 F.2d 687 certiorari granted 58 S. Ct. 760, 303 U.S. 82 L. Ed. 1092;
See also Weedin v. Tayokichi Yamada 4 F. (2d) 455). Such resolution would
not lose its value as a precedent just because the disposition of the case was
also made on some other ground.
5. ADMINISTRATIVE LAW; EXECUTIVE ORDER NO. 127;
SEPARATION FROM OFFICE; RIGHT TO BE INFORMED OF
GROUND OF SEPARATION UNDER EXECUTIVE ORDER NO. 17,
DISPENSED WITH. — The right granted by EO 17 to an employee to be
informed of the ground for his separation must be deemed to have been
revoked by the repealing clause of EO 127 (Section 67) providing that "all
laws, ordinances or parts thereof, which are inconsistent with this Executive
Order, are hereby repealed and modified accordingly."
6. ID.; CIVIL SERVICE ACT; REMOVAL FROM CAREER SERVICE;
TYPES OF REORGANIZATION. — The standards laid down are the
"traditional" criteria for removal of employees from the career service, e.g.
valid cause, due notice and hearing, abolition of, or redundancy of
offices. Proclamation No. 3, on the other hand, effectuates the "progressive"
type of reorganization dictated by the exigencies of the historical and political
upheaval at the time. The "traditional" type is limited in scope. It is concerned
with the individual approach where the particular employee involved is
charged administratively and where the requisites of notice and hearing have
to be observed. The "progressive" kind of reorganization, on the other hand,
is the collective way. It is wider in scope, and is the reorganization
contemplated under Section 16.
7. ID.; ID.; ID.; RIGHTS AVAILABLE TO A REORGANIZED
EMPLOYEE. — A reorganized employee is not without rights. His right lies
in his past services, the entitlement to which must be provided for by law. EO
127 provides for the same in its Section 59, and so does SECTION 16 when
the latter specified that career civil service employees separated from the
service not for cause: "shall be entitled to appropriate separation pay and to
retirement and other benefits accruing to them under the laws of general
application in force at the time of their separation. In lieu thereof, at the option
of the employees, they may be considered for employment in the Government
or in any of its subdivisions, instrumentalities, or agencies, including
government-owned or controlled corporations and their subsidiaries. This
provision also applies to career officers whose resignation, tendered in line
with the existing policy, has been accepted."
8. ID.; ID.; RIGHT TO AN OFFICE OR EMPLOYMENT WITH
GOVERNMENT, NOT A VESTED RIGHT. — The right to an office or to
employment with government or any of its agencies is not a vested property
right, and removal therefrom will not support the question of due process"
(Yantsin v. Aberdeen, 54 Wash 2d 787, 345 P 2d 178). A civil service
employee does not have a constitutionally protected right to his position,
which position is in the nature of a public office, political in character and
held by way of grant or privilege extended by government; generally he has
been held to have no property right or vested interest to which due process
guaranties extend (See Taylor v. Beckham 178 U. S. 548, 44 L Ed. 1187;
Angilly v. US (CA2 NY) 199 F 2d 642; People ex. rel. Baker v. Wilson, 39
III App 2d 443, 189 NE 2d 1; Kelliheller v. NY State Civil Service Com., 21
Misc 2d 1034, 194 NYS 2d 89).
DECISION
SARMIENTO, J p:
The Court writes finis to this controversy that has raged bitterly for the past
several months. It does so out of a legitimate presentiment of more suits
reaching it as a consequence of the government reorganization and the
instability it has wrought on the performance and efficiency of the
bureaucracy. The Court is apprehensive that unless the final word is given
and the ground rules are settled, the issue will fester, and likely foment a
constitutional crisis for the nation, itself beset with grave and serious
problems.Cdpr
The facts are not in dispute.
On March 25, 1986, President Corazon Aquino promulgated Proclamation
No. 3, "DECLARING A NATIONAL POLICY TO IMPLEMENT THE
REFORMS MANDATED BY THE PEOPLE, PROTECTING THEIR
BASIC RIGHTS, ADOPTING A PROVISIONAL CONSTITUTION, AND
PROVIDING FOR AN ORDERLY TRANSITION TO A GOVERNMENT
UNDER A NEW CONSTITUTION. Among other things, Proclamation No.
3 provided:
SECTION 1. . . .
The President shall give priority to measures to achieve
the mandate of the people to:
(a) Completely reorganize the government, eradicate
unjust and oppressive structures, and all iniquitous
vestiges of the previous regime; 1
Pursuant thereto, it was also provided:
SECTION 1. In the reorganization of the government,
priority shall be given to measures to promote economy,
efficiency, and the eradication of graft and corruption.
SECTION 2. All elective and appointive officials and
employees under the 1973 Constitution shall continue in
office until otherwise provided by proclamation or
executive order or upon the appointment and
qualification of the successors, if such is made within a
period of one year from February 25, 1986.
SECTION 3. Any public officer or employee separated
from the service as a result of the organization effected
under this Proclamation shall, if entitled under the laws
 then in force, receive the retirement and other benefits
accruing thereunder.
SECTION 4. The records, equipment, buildings,
facilities and other properties of all government offices
shall be carefully preserved. In case any office or body
is abolished or reorganized pursuant to this
Proclamation, its funds and properties shall be
transferred to the office or body to which its powers,
functions and responsibilities substantially pertain. 2
Actually, the reorganization process started as early as February 25, 1986,
when the President, in her first act in office, called upon "all appointive public
officials to submit their courtesy resignation(s) beginning with the members
of the Supreme Court." 3 Later on, she abolished the Batasang
Pambansa 4 and the positions of Prime Minister and Cabinet 5 under
the 1973 Constitution.
Since then, the President has issued a number of executive orders and
directives reorganizing various other government offices, a number of which,
with respect to elected local officials, has been challenged in this Court, 6 and
two of which, with respect to appointed functionaries, have likewise been
questioned herein. 7
On May 28, 1986, the President enacted Executive Order No. 17,
"PRESCRIBING RULES AND REGULATIONS FOR THE
IMPLEMENTATION OF SECTION 2, ARTICLE III OF THE FREEDOM
CONSTITUTION." Executive Order No. 17 recognized the "unnecessary
anxiety and demoralization among the deserving officials and employees" the
ongoing government reorganization had generated, and prescribed as
"grounds for the separation/replacement of personnel," the following:
SECTION 3. The following shall be the grounds for separation/replacement
of personnel:
1) Existence of a case for summary dismissal pursuant to
Section 40 of the Civil Service Law; cdphil
2) Existence of a probable cause for violation of the
Anti-Graft and Corrupt Practices Act as determined by
the Ministry Head concerned;
3) Gross incompetence or inefficiency in the discharge
of functions;
4) Misuse of public office for partisan political purposes;
5) Any other analogous ground showing that the
incumbent is unfit to remain in the service or his
separation/replacement is in the interest of the service. 8
On January 30, 1987, the President promulgated Executive Order No. 127,
"REORGANIZING THE MINISTRY OF FINANCE". 9 Among other
offices, Executive Order No. 127provided for the reorganization of the
Bureau of Customs 10 and prescribed a new staffing pattern therefor.
Three days later, on February 2, 1987, 11 the Filipino people adopted the new
Constitution.
On January 6, 1988, incumbent Commissioner of Customs Salvador Mison
issued a Memorandum, in the nature of "Guidelines on the Implementation
of Reorganization Executive Orders," 12 prescribing the procedure in
personnel placement. It also provided:
1. By February 28, 1988, all employees covered by
Executive Order 127 and the grace period extended to
the Bureau of Customs by the President of the
Philippines on reorganization shall be:
a) informed of their re-appointment, or
b) offered another position in the same
department or agency, or
c) informed of their termination. 13
On the same date, Commissioner Mison constituted a Reorganization (Sgd)
Appeals Board charged with adjudicating appeals from removals under the SALVADOR M.
above Memorandum. 14 On January 26, 1988, Commissioner Mison MISON
addressed several notices to various Customs officials, in the tenor as follows:
Commissi
Sir: oner 15

Please be informed that the Bureau is now in the process As far as the records will yield, the following were recipients of these notices:
of implementing the Reorganization Program
under Executive Order No. 127. 1. CESAR DARIO 30. LEONCIA CATRE

Pursuant to Section 59 of the same Executive Order, all 2. VICENTE FERIA, JR. 31. ROBERTO ABADA
officers and employees of the Department of Finance, or
the Bureau of Customs in particular, shall continue to
3. ADOLFO CASARENO 32. ABACA SISINIO T.
perform their respective duties and responsibilities in a
hold-over capacity, and that those incumbents whose
positions are not carried in the new reorganization 4. PACIFICO LAGLEVA 33. ABAD, ROGELIO C.
pattern, or who are not re-appointed, shall be deemed
separated from the service. LibLex 5. JULIAN C. ESPIRITU 34. ABADIANO, JOSE P.

In this connection, we regret to inform you that your
services are hereby terminated as of February 28, 1988.
Subject to the normal clearances, you may receive the
retirement benefits to which you may be entitled under
existing laws, rules and regulations.
6. DENNIS A. AZARRAGA 35. ABCEDE, NEMECIO C.
7. RENATO DE JESUS 36. ABIOG, ELY F.
8. NICASIO C. GAMBOA 37. ABLAZA, AURORA M.

9. CORAZON RALLOS NIEVES 38. AGBAYANI, NELSON I.

In the meantime, your name will be included in the 10. FELICITACION R. GELUZ 39. AGRES, ANICETO.
consolidated list compiled by the Civil Service
Commission so that you may be given priority for future
11. LEODEGARIO H. FLORESCA 40. AGUILAR, FLOR
employment with the Government as the need arises.
12. SUBAER PACASUM 41. AGUILUCHO, MA. TERESA R.
Sincerely
yours,
13. ZENAIDA LANARIA 42. AGUSTIN, BONIFACIO T.

14. JOSE B. ORTIZ 43. ALANO, ALEX P.

15. GLICERIO R. DOLAR 44. ALBA, MAXIMO F. JR.
16. CORNELIO NAPA 45. ALBANO ROBERT B.
17. PABLO B. SANTOS 46. ALCANTARA, JOSE G.
18. FERMIN RODRIGUEZ 47. ALMARIO, RODOLFO F.
19. DALISAY BAUTISTA 48. ALVEZ, ROMUALDO R.
20. LEONARDO JOSE 49. AMISTAD, RUDY M.
21. ALBERTO LONTOK 50. AMOS, FRANCIS F.
22. PORFIRIO TABINO 51. ANDRES, RODRIGO V.
23. JOSE BARREDO 52. ANGELES, RICARDO S.
24. ROBERTO ARNALDO 53. ANOLIN, MILAGROS H.
25. ESTER TAN 54. AQUINO, PASCASIO E. L.
26. PEDRO BAKAL 55. ARABE, MELINDA M.
27. ROSARIO DAVID 56. ARCANGEL, AGUSTIN S., JR.
28. RODOLFO AFUANG 58. ARREZA, ARTEMIO M., JR.
29. LORENZO CATRE 59. ARROJO, ANTONIO P.
60. ARVISU, ALEXANDER S. 107. DE GUZMAN,
ANTONIO A.
61. ASCAÑO, ANTONIO T. 108. DE GUZMAN, RENATO E.
62. ASLAHON, JULAHON P. 109. GAN, ALBERTO R.
63. ASUNCION, VICTOR. 110. DELA CRUZ, FRANCISCO
C.
64. ATANGAN, LORNA S. 111. DE LA PEÑA, LEONARDO
65. ATIENZA, ALEXANDER. 112. DEL CAMPO,
ORLANDO
66. BACAL, URSULINO C. 113. DEL RIO, MAMERTO P.,
JR.
67. BAÑAGA, MARLOWE Z. 114. DE MESA,
WILHELMINA T.
68. BANTA, ALBERTO T. 115. DIMAKUTA, SALIC L.
69. BARROS, VICTOR C. 116. DIZON, FELICITAS A.
70. BARTOLOME, FELIPE A. 117. DOCTOR, HEIDY M.
71. BAYSAC, REYNALDO S. 118. DOMINGO, NICANOR J.
72. BELENO, ANTONIO B. 119. DOMINGO, PERFECTO V.,
JR.
73. BERNARDO, ROMEO D. 120. DUAY, JUANA G.
74. BERNAS, MARCIANO S. 121. DYSANGCO, RENATO
F.
75. BOHOL, AUXILIADOR G. 122. EDILLOR, ALFREDO P.
76. BRAVO, VICTOR M. 123. ELEVAZO, LEONARDO A.
77. BULEG, BALILIS R. 124. ESCUYOS, MANUEL M., JR.
78. CALNEA, MERCEDES M. 125. ESMERIA, ANTONIO E.
79. CALVO, HONESTO G. 126. ESPALDON, MA.
LOURDES H.
80. CAMACHO, CARLOS V. 127. ESPINA, FRANCO A.
81. CAMPOS, RODOLFO C. 128. ESTURCO, RODOLFO C.
82. CAPULONG, RODRIGO G. 129. EVANGELINO,
FERMIN I.
83. CARINGAL, GRACIA Z. 130. FELIX, ERNESTO G.
84. CARLOS, LORENZO B. 131. FERNANDEZ, ANDREW
M.
85. CARRANTO, FIDEL U. 132. FERRAREN, ANTONIO C.
86. CARUNGCONG, ALFREDO M. 133. FERRERA,
WENCESLAO A.
87. CASTRO, PATRICIA J. 134. FRANCISCO, PELAGIO S.,
JR.
88. CATELO, ROGELIO B. 135. FUENTES, RUDY L.
89. CATURLA, MANUEL B. 136. GAGALANG, RENATO
V.
90. CENIZAL, JOSEFINA F. 137. GALANG, EDGARDO R.
91. CINCO, LUISITO 138. GAMBOA, ANTONIO C.
92. CONDE, JOSE C., JR. 139. GAN, ALBERTO R.
93. CORCUERA, FIDEL S. 140. GARCIA, GILBERT M.
94. CORNETA, VICENTE S. 141. GARCIA, EDNA V.
95. CORONADO, RICARDO S. 142. GARCIA, JUAN L.
98. CRUZ, EDUARDO S. 143. GAVIOLA, LILIAN V.
97. CRUZ, EDILBERTO A 144. GEMPARO, SEGUNDINA
G.
98. CRUZ, EFIGENIA B. 145. GOBENCIONG, FLORDELIZ
B.
99. CRUZADO, MARCIAL C. 146. GRATE, FREDERICK R.
100. CUSTUDIO, RODOLFO M. 147. GREGORIO, LAURO
P.
101. DABON, NORMA M. 148. GUARTICO, AMMON H.
102. DALINDIN, EDNA MAE D. 149. GUIANG, MYRNA N.
103. DANDAL, EDEN F. 150. GUINTO, DELFIN C.
104. DATUHARON, SATA A. 151. HERNANDEZ, LUCAS
A.
105. DAZO, GODOFREDO L. 152. HONRALES, LORETO N.
106. DE CASTRO, LEOPAPA 153. HUERTO, LEOPOLDO H.
154. HULAR, LANNYROSS E. 201. MATUGAS, ERNESTO
T.
155. IBAÑEZ, ESTER C. 202. MATUGAS, FRANCISCO T.
156. ILAGAN, HONORATO C. 203. MAYUGA, PORTIA E.
157. INFANTE, REYNALDO C. 204. MEDINA, NESTOR M.
158. ISAIS, RAY C. 205. MEDINA, ROLANDO S.
159. ISMAEL, HADJI AKRAM B. 206. MENDAVIA
AVELINO I.
160. JANOLO, VIRGILIO M. 207. MENDOZA,
POTENCIANO G.
161. JAVIER, AMADOR L. 208. MIL, RAY M.
162. JAVIER, ROBERTO S. 209. MIRAVALLES,
ANASTACIA L.
163. JAVIER, WILLIAM R. 210. MONFORTE, EUGENIO,
JR. G.
164. JOVEN, MEMIA A. 211. MONTANO, ERNESTO F.
165. JULIAN, REYNALDO V. 212. MONTERO, JUAN M. III
166. JUMAMOY, ABUNDIO A. 213. MORALDE,
ESMERALDO B., JR.
167. JUMAQUIAO, DOMINGO F. 214. MORALES,
CONCHITA D.L.
163. KAINDOY, PASCUAL B., JR. 215. MORALES,
NESTOR P.
169. KOH, NANIE G. 216. MORALES, SHIRLEY S.
170. LABILLES, ERNESTO S. 217. MUNAR, JUANITA L.
171. LABRADOR, WILFREDO M. 213. MUÑOZ, VICENTE
R.
172. LAGA, BIENVENIDO M. 219. MURILLO, MANUEL M.
173. LAGMAN, EVANGELINE G. 220. NACION, PEDRO R.
174. LAMPONG, WILFREDO G. 221. NAGAL, HENRY N.
175. LANDICHO, RESTITUTO A. 222: NAVARRO, HENRY
L.
176. LAPITAN, CAMILO M. 223. NEJAL, FREDRICK E.
177. LAURENTE, REYNALDO A. 224. NICOLAS,
REYNALDO S.
178. LICARTE, EVARISTO R. 225. NIEVES, RUFINO A.
179. LIPIO, VICTOR O. 226. OLAIVAR, SEBASTIAN T.
180. LITTAUA, FRANKLIN Z. 227. OLEGARIO, LEO Q.
181. LOPEZ, MELENCIO L. 228. ORTEGA ARLENE R.
182. LUMBA OLIVIA R. 229. ORTEGA, JESUS R.
183. MACAISA BENITO T. 230. OSORIO, ABNER S.
184. MACAISA ERLINDA C. 231. PAPIO, FLORENTINO T.
II
135. MAGAT, ELPIDIO 232. PASCUA, ARNULFO A.
136. MAGLAYA, FERNANDO P. 233. PASTOR, ROSARIO
137. MALIBIRAN, ALFREDO C. 234. PELAYO, ROSARIO
L.
138. MALIBIRAN, ROSITA D. 235. PEÑA, AIDA C.
189. MALIJAN, LAZARO V. 236. PEREZ, ESPERIDION B.
190. MALLI, JAVIER M. 237. PEREZ, JESUS BAYANI M. 258. REYES, NORMA Z. 285. VELARDE, EDGARDO C.

191. MANAHAN, RAMON S. 233. PEREZ, ISIDRO A. 254. REYES, TELESFORO F. 286. VERA, AVELINO A.

192. MANUEL, ELPIDIO R. 239. PRUDENCIADO, 255. RIVERA, ROSITA L. 287. VERAME, OSCAR E.
EULOGIA S.
256. ROCES, ROBERTO V. 288. VIADO, LILLIAN T.
193. MARAVILLIA, GIL B. 240. PUNZALAN, LAMBERTO
N. 257. ROQUE, TERESITA S. 289. VIERNES, NAPOLEON K.

194. MARCELO, GIL C. 241. PURA, ARNOLD T. 258. ROSANES, MARILOU M. 290. VILLALON, DENNIS A.

195. MARIÑAS, RODOLFO V. 242. QUINONES, EDGARDO 259. ROSETE, ADAN I. 291. VILLAR, LUZ L.
I.
260. RUANTO, REY CRISTO C., JR. 292. VILLALUZ,
196. MAROKET, JESUS C. 243. QUINTOS, AMADEO C., EMELITO V.
JR.
261. SABLADA, PASCASIO G. 293. ZATA, ANGEL A, JR.
197. MARTIN, NEMENCIO A. 244. QUIRAY, NICOLAS C.
262. SALAZAR, SILVERIA S. 294. ACHARON, CRISTETO
198. MARTINEZ, ROMEO M. 245. RAMIREZ, ROBERTO P.
263. SALAZAR, VICTORIA A. 295. ALBA, RENATO B.
199. MARTINEZ, ROSELINA M. 246. RANADA, RODRIGO
C. 264. SALIMBACOD, PERLITA C. 296. AMON, JULITA C.

200. MATIBAG, ANGELINA G. 247. RARAS, ANTONIO A.

265. SALMINGO, LOURDES M. 297. AUSTRIA, ERNESTO
C.
248. RAVAL, VIOLETA V. 280. TOLENTINO, BENIGNO A.
266. SANTIAGO, EMELITA B. 293. CALO, RAYMUNDO
249. RAZAL, BETTY R. 281. TURINGAN, ENRICO T., JR. M.

250. REGALA, PONCE F. 282. UMPA, ALI A. 267. SATINA, PORFIRIO C. 299. CENTENO, BENJAMIN R.

251. REYES, LIBERATO R. 283. VALIC, LUCIO E. 268. SEKITO, COSME B., JR. 300. DONATO, ESTELITA P.

252. REYES, MANUEL E. 284. VASQUEZ, NICANOR B. 269. SIMON, RAMON P. 301. DONATO, FELIPE S.
 270. SINGSON, MELECIO C. 302. FLORES, PEDRITO S.
271. SORIANO, ANGELO L. 303. GALAROSA, RENATO
272. SORIANO, MAGDALENA R. 304. MALAWI,
MAUYAG
273. SUMULONG, ISIDORO L., JR. 305. MONTENEGRO,
FRANCISCO M.
274. SUNICO, ABELARDO T. 306. OMEGA, PETRONILO
T.
275. TABIJE, EMMA B. 307. SANTOS, GUILLERMO F.
276. TAN, RUDY GOROSPE 308. TEMPLO, CELSO
277. TAN, ESTER S. 309. VALDERAMA, JAIME B.
273. TAN, JULITA S. 310. VALDEZ, NORA M.
279. TECSON, BEATRIZ B.
Cesar Dario is the petitioner in G.R. No. 81954; Vicente Feria, Jr., is the
petitioner in G.R. No. 81967; Messrs. Adolfo Caserano, Pacifico Lagleva,
Julian C. Espiritu, Dennis A. Azarraga, Renato de Jesus, Nicasio C. Gamboa,
Mesdames Corazon Rallos Nieves and Felicitacion R. Geluz, Messrs.
Leodegario H. Floresca, Subaer Pacasum, Ms. Zenaida Lanaria, Mr. Jose B.
Ortiz, Ms. Gliceria R. Dolar, Ms. Cornelia Napa, Pablo B. Santos, Fermin
Rodriguez, Ms. Dalisay Bautista, Messrs. Leonardo Jose, Alberto Lontok,
Porfirio Tabino, Jose Barredo, Roberto Arnaldo, Ms. Ester Tan, Messrs.
Pedro Bakal, Rosario David, Rodolfo Afuang, Lorenzo Catre, Ms. Leoncia
Catre, and Roberto Abada, are the petitioners in G.R. No. 82023; the last
279 16 individuals mentioned are the private respondents in G.R. No.
85310. prcd
As far as the records will likewise reveal, 1 7 a total of 394 officials and
employees of the Bureau of Customs were given individual notices of
separation. A number supposedly sought reinstatement with the
Reorganization Appeals Board while others went to the Civil Service
Commission. The first thirty one mentioned above came directly to this
Court.
On June 30, 1988, the Civil Service Commission promulgated its ruling
ordering the reinstatement of the 279 employees, the 279 private respondents
in G.R. No. 85310, the dispositive portion of which reads as follows:
WHEREFORE, it is hereby ordered that:
1. Appellants be immediately reappointed to positions of
comparable or equivalent rank in the Bureau of Customs
without loss of seniority rights;
2. Appellants be paid their back salaries reckoned from
the dates of their illegal termination based on the rates
under the approved new staffing pattern but not lower
than their former salaries.
This action of the Commission should not, however, be
interpreted as an exoneration of the appellants from any
accusation of wrongdoing and, therefore, their
reappointments are without prejudice to:
1. Proceeding with investigation of appellants with
pending administrative cases, and where investigations
have been finished, to promptly render the appropriate
decisions; cdrep
2. The filing of appropriate administrative complaints
against appellants with derogatory reports or information
if evidence so warrants.
SO ORDERED. 18
On July 15, 1988, Commissioner Mison, represented by the Solicitor General,
filed a motion for reconsideration. Acting on the motion, the Civil Service
Commission, on September 20, 1988, denied reconsideration. 19
On October 20, 1988, Commissioner Mison instituted certiorari proceedings
with this Court, docketed, as above-stated, as G.R. No. 85310 of this Court.
On November 16, 1988, the Civil Service Commission further disposed the
appeal (from the resolution of the Reorganization Appeals Board) of five
more employees, holding as follows:
WHEREFORE, it is hereby ordered that:
1. Appellants be immediately reappointed to positions of
comparable or equivalent rank in the Bureau of Customs
without loss of seniority rights; and
2. Appellants be paid their back salaries to be reckoned
from the date of their illegal termination based on the
rates under the approved new staffing pattern but not
lower than their former salaries.
This action of the Commission should not, however, be
interpreted as an exoneration of the herein appellants
from any accusation of any wrongdoing and therefore,
their reappointments are without prejudice to:
1. Proceeding with investigation of appellants with
pending administrative cases, if any, and where
investigations have been finished, to promptly, render
the appropriate decisions; and
2. The filing of appropriate administrative complaints
against appellant with derogatory reports or information,
if any, and if evidence so warrants.
SO ORDERED. 20
On January 6, 1989, Commissioner Mison challenged the Civil Service
Commission's Resolution in this Court; his petition has been docketed herein
as G.R. No. 86241. The employees ordered to be reinstated are Senen
Dimaguila, Romeo Arabe, Bernardo Quintong, Gregorio Reyes, and Romulo
Badillo. 21
On June 10, 1988, Republic Act No. 6656, "AN ACT TO PROTECT THE
SECURITY OF TENURE OF CIVIL SERVICE OFFICERS AND
EMPLOYEES IN THE IMPLEMENTATION OF GOVERNMENT
REORGANIZATION," 22 was signed into law. Under Section 7, thereof:
Sec. 9. All officers and employees who are found by the
Civil Service Commission to have been separated in
violation of the provisions of this Act, shall be ordered
reinstated or reappointed as the case may be without loss
of seniority and shall be entitled to full pay for the period
of separation. Unless also separated for cause, all officers
and employees, including casuals and temporary
employees, who have been separated pursuant to
reorganization shall, if entitled thereto, be paid the
appropriate separation pay and retirement and other
benefits under existing laws within ninety (90) days from
the date of the effectivity of their separation or from the
date of the receipt of the resolution of their appeals as the
case may be: Provided, That application for clearance
has been filed and no action thereon has been made by
the corresponding department or agency. Those who are
not entitled to said benefits shall be paid a separation
gratuity in the amount equivalent to one (1) month salary
for every year of service. Such separation pay and
retirement benefits shall have priority of payment out of
the savings of the department or agency concerned. 23
On June 23, 1988, Benedicto Amasa and William Dionisio, customs
examiners appointed by Commissioner Mison pursuant to the ostensible
reorganization subject of this controversy, petitioned the Court to contest the
validity of the statute. The petition is docketed as G.R. No. 83737.
On October 21, 1988, thirty-five more Customs officials whom the Civil
Service Commission had ordered reinstated by its June 30, 1988 Resolution
filed their own petition to compel the Commissioner of Customs to comply
with the said Resolution. The petition is docketed as G.R. No. 85335. llcd
On November 29, 1988, we resolved to consolidate all seven petitions.
On the same date, we resolved to set the matter for hearing on January 12,
1989. At the said hearing, the parties, represented by their counsels (a) retired
Justice Ruperto Martin; (b) retired Justice Lino Patajo; (c) former Dean
Froilan Bacungan; (d) Atty. Lester Escobar; (e) Atty. Faustino Tugade; and
(f) Atty. Alexander Padilla, presented their arguments. Solicitor General
Francisco Chavez argued on behalf of the Commissioner of Customs (except
in G.R. 85335, in which he represented the Bureau of Customs and the Civil
Service Commission). Former Senator Ambrosio Padilla also appeared and
argued as amicus curiae. Thereafter, we resolved to require the parties to
submit their respective memoranda which they did in due time.
There is no question that the administration may validly carry out a
government reorganization — insofar as these cases are concerned, the
reorganization of the Bureau of Customs — by mandate not only of
the Provisional Constitution, supra, but also of the various Executive Orders
decreed by the Chief Executive in her capacity as sole lawmaking authority
under the 1986-1987 revolutionary government. It should also be noted that
under the present Constitution, there is a recognition, albeit implied, that a
government reorganization may be legitimately undertaken, subject to certain
conditions. 24
The Court understands that the parties are agreed on the validity of a
reorganization per se, the only question being, as shall be later seen: What is
the nature and extent of this government reorganization?
The Court disregards the questions raised as to procedure, failure to exhaust
administrative remedies, the standing of certain parties to sue, 25 and other
technical objections, for two reasons, "[b]ecause of the demands of public
interest, including the need for stability in the public service," 26 and because
of the serious implications of these cases on the administration of the
Philippine civil service and the rights of public servants.
The urgings in G.R. Nos. 85335 and 85310, that the Civil Service
Commission's Resolution dated June 30, 1988 had attained a character of
finality for failure of Commissioner Mison to apply for judicial review or ask
for reconsideration seasonably under Presidential Decree No. 807, 27 or
under Republic Act No. 6656, 28 or under the Constitution, 29are likewise
rejected. The records show that the Bureau of Customs had until July 15,
1988 to ask for reconsideration or come to this Court pursuant to Section 39
ofPresidential Decree No. 807. The records likewise show that the Solicitor
General filed a motion for reconsideration on July 15, 1988. 30 The Civil
Service Commission issued its Resolution denying reconsideration on
September 20, 1988; a copy of this Resolution was received by the Bureau
on September 23, 1988. 31 Hence the Bureau had until October 23, 1988 to
elevate the matter on certiorari to this Court. 32 Since the Bureau's petition
was filed on October 20, 1988, it was filed on time.
We reject, finally, contentions that the Bureau's petition (in G.R. 85310)
raises no jurisdictional questions, and is therefore bereft of any basis as a
petition for certiorari under Rule 65 of the Rules of Court. 33 We find that
the questions raised in Commissioner Mison's petition (in G.R. 85310) are,
indeed, proper for certiorari, if by 'jurisdictional questions" we mean
questions having to do with "an indifferent disregard of the law, arbitrariness
and caprice, or omission to weigh pertinent considerations, a decision arrived
at without rational deliberation," 34 as distinguished from questions that
require "digging into the merits and unearthing errors of judgment" 35 which
is the office, on the other hand, of review under Rule 45 of the said Rules.
What cannot be denied is the fact that the act of the Civil Service Commission
of reinstating hundreds of Customs employees Commissioner Mison had
separated, has implications not only on the entire reorganization process
decreed no less than by the Provisional Constitution, but on the Philippine
bureaucracy in general; these implications are of such a magnitude that it
cannot be said that — assuming that the Civil Service Commission erred —
the Commission committed a plain "error of judgment" that Aratuc says
cannot be corrected by the extraordinary remedy of certiorari or any special
civil action. We reaffirm the teaching of Aratuc — as regards recourse to this
Court with respect to rulings of the Civil Service Commission — which is
that judgments of the Commission may be brought to the Supreme Court
through certiorari alone, under Rule 65 of the Rules of Court.
In Aratuc, we declared:
It is once evident from these constitutional and statutory modifications that
there is a definite tendency to enhance and invigorate the role of the
Commission on Elections as the independent constitutional body charged
with the safeguarding of free, peaceful and honest elections. The framers of
the new Constitution must be presumed to have definite knowledge of what
it means to make the decisions, orders and rulings of the Commission "subject
to review by the Supreme Court". And since instead of maintaining that
provision intact, it ordained that the Commission's actuations be instead
"brought to the Supreme Court on certiorari', We cannot insist that there was
no intent to change the nature of the remedy, considering that the limited
scope of certiorari, compared to a review, is well known in remedial law. 36
We observe no fundamental difference between the Commission on Elections
and the Civil Service Commission (or the Commission on Audit for that
matter) in terms of the constitutional intent to leave the constitutional bodies
alone in the enforcement of laws relative to elections, with respect to the
former, and the civil service, with respect to the latter (or the audit of
government accounts, with respect to the Commission on Audit). As the poll
body is the "sole judge" 37 of all election cases, so is the Civil Service
Commission the single arbiter of all 5 controversies pertaining to the civil
service.
It should also be noted that under the new Constitution, as under the 1973
Charter, "any decision, order, or ruling of each Commission may be brought
to the Supreme Court on certiorari," 38 which, as Aratuc tells us, "technically
connotes something less than saying that the same 'shall be subject to review
by the Supreme Court,'" 39 which in turn suggests an appeal by petition for
review under Rule 45. Therefore, our jurisdiction over cases emanating from
the Civil Service Commission is limited to complaints of lack or excess of
jurisdiction or grave abuse of discretion tantamount to lack or excess of
jurisdiction, complaints that justify certiorari under Rule 65. cdtai
While Republic Act No. 6656 states that judgments of the Commission are
"final and executory" 40 and hence, unappealable, under Rule 65, certiorari
precisely lies in the absence of an appeal. 41
Accordingly, we accept Commissioner Mison's petition (G.R. No. 85310)
which clearly charges the Civil Service Commission with grave abuse of
discretion, a proper subject of certiorari, although it may not have so stated
in explicit terms.
As to charges that the said petition has been filed out of time, we reiterate
that it has been filed seasonably. It is to be stressed that the Solicitor General
had thirty days from September 23, 1988 (the date the Resolution, dated
September 20, 1988, of the Civil Service Commission, denying
reconsideration, was received) to commence the instant certiorari
proceedings. As we stated, under the Constitution, an aggrieved party has
thirty days within which to challenge "any decision, order, or ruling" 42 of
the Commission. To say that the period should be counted from the Solicitor's
receipt of the main Resolution, dated June 30, 1988, is to say that he should
not have asked for reconsideration. But to say that is to deny him the right to
contest (by a motion for reconsideration) any ruling, other than the main
decision, when, precisely, the Constitution gives him such a right. That is also
to place him at a "no-win" situation because if he did not move for a
reconsideration, he would have been faulted for demanding certiorari too
early, under the general rule that a motion for reconsideration should preface
a resort to a special civil action. 43 Hence, we must reckon the thirty-day
period from receipt of the order of denial. cdasia
We come to the merits of these cases.
G.R. Nos. 81954, 81967, 82023, and 85335:
The Case for the Employees
The petitioner in G.R. No. 81954, Cesar Dario, was one of the Deputy
Commissioners of the Bureau of Customs until his relief on orders of
Commissioner Mison on January 26, 1988. In essence, he questions the
legality of his dismissal, which he alleges was upon the authority of Section
59 of Executive Order No. 127, supra, hereinbelow reproduced as follows:
SEC. 59. New Structure and Pattern. Upon approval of
this Executive Order, the officers and employees of the
Ministry shall, in a holdover capacity, continue to
perform their respective duties and responsibilities and
 receive the corresponding salaries and benefits unless in
the meantime they are separated from government
service pursuant to Executive Order No. 17 (1986) or
Article III of the Freedom Constitution.
The new position structure and staffing pattern of the
Ministry shall be approved and prescribed by the
Minister within one hundred twenty (120) days from the
approval of this Executive Order and the authorized
positions created hereunder shall be filled with regular
appointments by him or by the President, as the case may
be. Those incumbents whose positions are not included
therein or who are not reappointed shall be deemed
separated from the service. Those separated from the
service shall receive the retirement benefits to which
they may be entitled under existing laws, rules and
regulations. Otherwise, they shall be paid the equivalent
of one month basic salary for every year of service, or
the equivalent nearest fraction thereof favorable to them
on the basis of highest salary received but in no case shall
such payment exceed the equivalent of 12 months salary.
No court or administrative body shall issue any writ of
preliminary injunction or restraining order to enjoin the
separation/replacement of any officer or employee
effected under this Executive Order. 44
a provision he claims the Commissioner could not have legally
invoked. He avers that he could not have been legally deemed to be an
"[incumbent] whose [position] [is] not included therein or who [is] not
reappointed" 45 to justify his separation from the service. He contends
that neither the Executive Order (under the second paragraph of the
section) nor the staffing pattern proposed by the Secretary of
Finance 46 abolished the office of Deputy Commissioner of Customs,
but, rather, increased it to three. 47Nor can it be said, so he further
maintains, that he had not been "reappointed" 48 (under the second
paragraph of the section) because "[r]eappointment therein presupposes
that the position to which it refers is a new one in lieu of that which has
been abolished or although an existing one, has absorbed that which
has been abolished." 49 He claims, finally, that under the Provisional
Constitution, the power to dismiss public officials without cause ended
on February 25, 1987, 50 and that thereafter, public officials enjoyed
security of tenure under the provisions of the 1987 Constitution. 51
Like Dario, Vicente Feria, the petitioner in G.R. No. 81967, was a Deputy
Commissioner at the Bureau until his separation directed by Commissioner
Mison. And like Dario, he claims that under the 1987 Constitution, he has
acquired security of tenure and that he cannot be said to be covered by Section
59 of Executive Order No. 127, having been appointed on April 22, 1986 —
during the effectivity of the Provisional Constitution. He adds that
under Executive Order No. 39, "ENLARGING THE POWERS AND
FUNCTIONS OF THE COMMISSIONER OF CUSTOMS," 52 the
Commissioner of Customs has the power "[t]o appoint all Bureau personnel,
except those appointed by the President," 53 and that his position, which is
that of a Presidential appointee, is beyond the control of Commissioner Mison
for purposes of reorganization.
The petitioners in G.R. No. 82023, collectors and examiners in various ports
of the Philippines, say, on the other hand, that the purpose of reorganization
is to end corruption at the Bureau of Customs and that since there is no finding
that they are guilty of corruption, they cannot be validly dismissed from the
service. LLphil
The Case for Commissioner Mison
In his comments, the Commissioner relies on this Court's resolution in Jose
v. Arroyo, 54 in which the following statement appears in the last paragraph
thereof:
The contention of petitioner that Executive Order No.
127 is violative of the provision of the 1987
Constitution guaranteeing career civil service employees
security of tenure overlooks the provisions of Section 16,
Article XVIII (Transitory Provisions) which explicitly
authorize the removal of career civil service employees
"not for cause but as a result of the reorganization
pursuant to Proclamation No. 3 dated March 25,
1986 and the reorganization following the ratification of
this Constitution." By virtue of said provision, the
 reorganization of the Bureau of Customs
under Executive Order No. 127 may continue even after
the ratification of the Constitution, and career civil
service employees may be separated from the service
without cause as a result of such reorganization. 55
reinstating the 265 customs employees above-stated; (2) the Resolution,
dated September 20, 1988, denying reconsideration; and (3) the Resolution,
dated November 16, 1988, reinstating five employees. The Commissioner's
arguments are as follows:

For this reason, Mison posits, claims of violation of security of tenure are
allegedly no defense. He further states that the deadline prescribed by 1. The ongoing government reorganization is in the nature of a
the Provisional Constitution(February 25, 1987) has been superseded by "progressive" 60 reorganization "impelled by the need to overhaul the entire
the 1987 Constitution, specifically, the transitory provisions government bureaucracy" 61following the people power revolution of 1986;
thereof, 56 which allows a reorganization thereafter (after February 25, 1987)
as this very Court has so declared in Jose v. Arroyo. Mison submits that
2. There was faithful compliance by the Bureau of the various guidelines
contrary to the employees' argument, Section 59 of Executive Order No. issued by the President, in particular, as to deliberation, and selection of
127 is applicable (in particular, to Dario and Feria), in the sense that retention personnel for appointment under the new staffing pattern;
in the Bureau, under the Executive Order, depends on either retention of the
position in the new staffing pattern or reappointment of the incumbent, and
since the dismissed employees had not been reappointed, they had been 3. The separated employees have been, under Section 59 of Executive Order
considered legally separated. Moreover, Mison proffers that under Section 59 No. 127, on mere holdover standing, "which means that all positions are
incumbents are considered on holdover status, "which means that all those declared vacant;" 62
positions were considered vacant." 57 The Solicitor General denies the
applicability of Palma-Fernandez v. De la Paz 58 because that case 4. Jose v. Arroyo has declared the validity of Executive Order No. 127 under
supposedly involved a mere transfer and not a separation. He rejects, finally the transitory provisions of the 1987 Constitution;
the force and effect of Executive Order Nos. 17 and 39 for the reason
that Executive Order No. 17, which was meant to implement the Provisional 5. Republic Act No. 6656 is of doubtful constitutionality.
Constitution, 59 had ceased to have force and effect upon the ratification of
the 1987 Constitution, and that, under Executive Order No. 39, the dismissals The Ruling of the Civil Service Commission
contemplated were "for cause" while the separations now under question
were "not for cause and were a result of government reorganization decreed
The position of the Civil Service Commission is as follows:
by Executive Order No. 127. Anent Republic Act No. 6656, he expresses
doubts on the constitutionality of the grant of retroactivity therein (as regards
the reinforcement of security of tenure) since the new Constitution clearly 1. Reorganizations occur where there has been a reduction in personnel or
allows reorganization after its effectivity. dctai redundancy of functions; there is no showing that the reorganization in
question has been carried out for either purpose — on the contrary, the
dismissals now disputed were carried out by mere service of notices;
G.R. Nos. 85310 and 86241

2. The current Customs reorganization has not been made according to

The Position of Commissioner Mison
Malacañang guidelines; information on file with the Commission shows that
Commissioner Mison has been appointing unqualified personnel;
Commissioner's twin petitions are direct challenges to three rulings of the
Civil Service Commission: (1) the Resolution, dated June 30, 1988,
3. Jose v. Arroyo, in validating Executive Order No. 127, did not
countenance illegal removals; LLjur
4. Republic Act No. 6656 protects security of tenure in the course of
reorganizations.
The Court's Ruling
Reorganization, Fundamental Principles of . —
I.
The core provision of law involved is Section 16 Article XVIII, of the 1987
Constitution. We quote:
Sec. 16. Career civil service employees separated from
the service not for cause but as a result of the
reorganization pursuant to Proclamation No. 3 dated
March 25, 1986 and the reorganization following the
ratification of this Constitution shall be entitled to
appropriate separation pay and to retirement and other
benefits accruing to them under the laws of general
application in force at the time of their separation. In lieu
thereof, at the option of the employees, they may be
considered for employment in the Government or in any
of its subdivisions, instrumentalities, or agencies,
including government-owned or controlled corporations
and their subsidiaries. This provision also applies to
career officers whose resignation, tendered in line with
the existing policy, had been accepted. 63
The Court considers the above provision critical for two reasons: (1) It is the
only provision — insofar as it mentions removals not for cause — that would
arguably support the challenged dismissals by mere notice, and (2) It is the
single existing law on reorganization after the ratification of the 1987 Charter,
except Republic Act No. 6656, which came much later, on June 10, 1988.
[Nota bene: Executive Orders No. 116 (covering the Ministry of Agriculture
& Food), 117 (Ministry of Education, Culture & Sports), 119 (Health), 120
(Tourism), 123 (Social Welfare & Development), 124 (Public Works &
Highways), 125 (Transportation & Communications), 126 (Labor &
Employment), 127 (Finance), 128 (Science & Technology), 129 (Agrarian
Reform), 131 (Natural Resources), 132 (Foreign Affairs), and 133 (Trade &
Industry) were all promulgated on January 30, 1987, prior to the adoption
of the Constitution on February 2, 1987]. 64
It is also to be observed that unlike the grants of power to effect
reorganizations under the past Constitutions, the above provision comes as a
mere recognition of the right of the Government to reorganize its offices,
bureaus, and instrumentalities. Under Section 4, Article XVI, of the 1935
Constitution:
Section 4. All officers and employees in the existing
Government of the Philippine Islands shall continue in
office until the Congress shall provide otherwise, but all
officers whose appointments are by
this Constitution vested in the President shall vacate
their respective office(s) upon the appointment and
qualification of their successors, if such appointment is
made within a period of one year from the date of the
inauguration of the Commonwealth of the
Philippines. 65
Under Section 9, Article XVII, of the 1973 Charter:
Section 9. All officials and employees in the existing
Government of the Republic of the Philippines shall
continue in office until otherwise provided by law or
decreed by the incumbent President of the Philippines,
but all officials whose appointments are by
this Constitution vested in the Prime Minister shall
vacate their respective offices upon the appointment and
qualification of their successors. 66
The Freedom Constitution is, as earlier seen, couched in similar language:
SECTION 2. All elective and appointive officials and
employees under the 1973 Constitution shall continue in
office until otherwise provided by proclamation or
 executive order or upon the appointment and
qualification of their successors, if such is made within a
period of one year from February 25, 1986. 67
Other than references to "reorganization following the ratification of this
Constitution," there is no provision for "automatic" vacancies under the 1987
Constitution.
Invariably, transition periods are characterized by provisions for "automatic"
vacancies. They are dictated by the need to hasten the passage from the old
to the new Constitution free from the "fetters" of due process and security of
tenure. cdlex
At this point, we must distinguish removals from separations arising from
abolition of office (not by virtue of the Constitution) as a result of
reorganization carried out by reason of economy or to remove redundancy of
functions. In the latter case, the Government is obliged to prove good
faith. 68 In case of removals undertaken to comply with clear and explicit
constitutional mandates, the Government is not hard put to prove anything,
plainly and simply because the Constitution allows it.
Evidently, the question is whether or not Section 16 of Article XVIII of
the 1987 Constitution is a grant of a license upon the Government to remove
career public officials it could have validly done under an "automatic"-
vacancy-authority and to remove them without rhyme or reason.
As we have seen, since 1935, transition periods have been characterized by
provisions for "automatic" vacancies. We take the silence of the 1987
Constitution on this matter as a restraint upon the Government to dismiss
public servants at a moment's notice.
What is, indeed, apparent is the fact that if the present Charter envisioned an
"automatic" vacancy, it should have said so in clearer terms, as its 1935, 1973,
and 1986 counterparts had so stated.
The constitutional "lapse" means either one of two things: (1) The
Constitution meant to continue the reorganization under the prior Charter (of
the Revolutionary Government), in the sense that the latter provides for
"automatic" vacancies, or (2) It meant to put a stop to those "automatic"
vacancies. By itself, however, it is ambiguous, referring as it does to two
stages of reorganization — the first, to its conferment or authorization
under Proclamation No. 3 (Freedom Charter) and the second, to its
implementation on its effectivity date (February 2, 1987). But as we asserted,
if the intent of Section 16 of Article XVIII of the 1987 Constitution were to
extend the effects of reorganization under the Freedom Constitution, it should
have said so in clear terms. It is illogical why it should talk of two phases of
reorganization when it could have simply acknowledged the continuing effect
of the first reorganization. cdll
Second, plainly the concern of Section 16 is to ensure compensation for
"victims" of constitutional revamps — whether under the Freedom or
existing Constitution — and only secondarily and impliedly, to allow
reorganization. We turn to the records of the Constitutional Commission:
INQUIRY OF MR. PADILLA
On the query of Mr. Padilla whether there is a need for a
specific reference to Proclamation No. 3 and not merely
state "result of the reorganization following the
ratification of this Constitution", Mr. Suarez, on behalf
of the Committee, replied that it is necessary, inasmuch
as there are two stages of reorganization covered by the
Section.
Mr. Padilla pointed out that since the proposals of the
Commission on Government Reorganization have not
been implemented yet, it would be better to use the
phrase "reorganization before or after the ratification
of the Constitution" to simplify the Section. Mr. Suarez
instead suggested the phrase "as a result of the
reorganization effected before or after the ratification
of the Constitution" on the understanding that the
provision would apply to employees terminated because
of the reorganization pursuant to Proclamation No. 3 and
even those affected by the reorganization during the
Marcos regime. Additionally, Mr. Suarez pointed out
that it is also for this reason that the Committee specified
 the two Constitutions — the Freedom Constitution and
the 1986 [1987] Constitution. 69
Simply, the provision benefits career civil service employees separated from
the service. And the separation contemplated must be due to or the result of
(1) the reorganization pursuant to Proclamation No. 3 dated March 25, 1986,
(2) the reorganization from February 2, 1987, and (3) the resignations of
career officers tendered in line with the existing policy and which
resignations have been accepted. The phrase "not for cause" is clearly and
primarily exclusionary, to exclude those career civil service employees
separated "for cause." In other words, in order to be entitled to the benefits
granted under Section 16 of Article XVIII of the Constitution of 1987, two
requisites, one negative and the other positive, must concur, to wit:
1. the separation must not be for cause, and
2. the separation must be due to any of the three
situations mentioned above.
By its terms, the authority to remove public officials under the Provisional
Constitution ended on February 25, 1987, advanced by jurisprudence to
February 2, 1987. 70 It can only mean, then, that whatever reorganization is
taking place is upon the authority of the present Charter, and necessarily,
upon the mantle of its provisions and safeguards. Hence, it can not be
legitimately stated that we are merely continuing what the revolutionary
Constitution of the Revolutionary Government had started. We are through
with reorganization under the Freedom Constitution — the first stage. We are
on the second stage — that inferred from the provisions of Section 16 of
Article XVIII of the permanent basic document. cda
This is confirmed not only by the deliberations of the Constitutional
Commission, supra, but is apparent from the Charter's own words. It also
warrants our holding in Esguerraand Palma-Fernandez, in which we
categorically declared that after February 2, 1987, incumbent officials and
employees have acquired security of tenure, which is not a deterrent against
separation by reorganization under the quondam fundamental law.
Finally, there is the concern of the State to ensure that this reorganization is
no "purge" like the execrated reorganizations under martial rule. And, of
course, we also have the democratic character of the Charter itself.
Commissioner Mison would have had a point, insofar as he contends that the
reorganization is open-ended ("progressive"), had it been a reorganization
under the revolutionary authority, specifically of the Provisional
Constitution. For then, the power to remove government employees would
have been truly wide-ranging and limitless, not only because Proclamation
No. 3 permitted it, but because of the nature of revolutionary authority itself,
its totalitarian tendencies, and the monopoly of power in the men and women
who wield it.
What must be understood, however, is that notwithstanding her immense
revolutionary powers, the President was, nevertheless, magnanimous in her
rule. This is apparent from Executive Order No. 17, which established
safeguards against the strong arm and ruthless propensity that accompanies
reorganizations — notwithstanding the fact that removals arising therefrom
were "not for cause," and in spite of the fact that such removals would have
been valid and unquestionable. Despite that, the Chief Executive saw, as we
said, the "unnecessary anxiety and demoralization" in the government rank
and file that reorganization was causing, and prescribed guidelines for
personnel action. Specifically, she said on May 28, 1986:
WHEREAS, in order to obviate unnecessary anxiety and
demoralization among the deserving officials and
employees, particularly in the career civil service, it is
necessary to prescribe the rules and regulations for
implementing the said constitutional provision to protect
career civil servants whose qualifications and
performance meet the standards of service demanded by
the New Government, and to ensure that only those
found corrupt, inefficient and undeserving are separated
from the government service; 71
Noteworthy is the injunction embodied in the Executive Order that dismissals
should be made on the basis of findings of inefficiency, graft, and unfitness
to render public service. **
The President's Memorandum of October 14, 1987 should furthermore be
considered. We quote, in part:
Further to the Memorandum dated October 2, 1987 on
the same subject, I have ordered that there will be no
further lay-offs this year of personnel as a result of the
government reorganization. 72
Assuming, then, that this reorganization allows removals "not for cause" in a
manner that would have been permissible in a revolutionary setting as
Commissioner Mison so purports, it would seem that the Commissioner
would have been powerless, in any event, to order dismissals at the Customs
Bureau left and right. Hence, even if we accepted his "progressive"
reorganization theory, he would still have to come to terms with the Chief
Executive's subsequent directives moderating the revolutionary authority's
plenary power to separate government officials and employees. LLpr
Reorganization under the 1987 Constitution, Nature, Extent, and
Limitations of ; Jose v. Arroyo, clarified. —
The controversy seems to be that we have, ourselves, supposedly extended
the effects of government reorganization under the Provisional
Constitution to the regime of the1987 Constitution. Jose v. Arroyo 73 is said
to be the authority for this argument. Evidently, if Arroyo indeed so
ruled, Arroyo would be inconsistent with the earlier pronouncement of
Esguerra and the later holding of Palma-Fernandez. The question, however,
is: Did Arroyo, in fact, extend the effects of reorganization under the
revolutionary Charter to the era of the new Constitution?
There are a few points about Arroyo that have to be explained. First, the
opinion expressed therein that "[b]y virtue of said provision the
reorganization of the Bureau of Customs under Executive Order No. 127 may
continue even after the ratification of this constitution and career civil service
employees may be separated from the service without cause as a result of
such reorganization" 74 is in the nature of an obiter dictum. We dismissed
Jose's petition 75 primarily because it was "clearly premature, speculative,
and purely anticipatory, based merely on newspaper reports which do not
show any direct or threatened injury," 76 it appearing that the reorganization
of the Bureau of Customs had not been, then, set in motion. Jose therefore
had no cause for complaint, which was enough basis to dismiss the petition.
The remark anent separation "without cause" was therefore not necessary for
the disposition of the case. In Morales v. Paredes, 77 it was held that an obiter
dictum "lacks the force of an adjudication and should not ordinarily be
regarded as such." 78
Secondly, Arroyo is an unsigned resolution while Palma-Fernandez is a full-
blown decision, although both are en banc cases. While a resolution of the
Court is no less forceful than a decision, the latter has a special weight.
Thirdly, Palma-Fernandez v. De la Paz comes as a later doctrine. (Jose v.
Arroyo was promulgated on August 11, 1987 while Palma-Fernandez was
decided on August 31, 1987.) It is well-established that a later judgment
supersedes a prior one in case of an inconsistency. prLL
As we have suggested, the transitory provisions of the 1987
Constitution allude to two stages of the reorganization, the first stage being
the reorganization under Proclamation No. 3 — which had already been
consummated — the second stage being that adverted to in the transitory
provisions themselves — which is underway. Hence, when we spoke,
in Arroyo, of reorganization after the effectivity of the new Constitution, we
referred to the second stage of the reorganization. Accordingly, we cannot be
said to have carried over reorganization under the Freedom Constitution to
its 1987 counterpart.
Finally, Arroyo is not necessarily incompatible with Palma-Fernandez (or
Esguerra).
As we have demonstrated, reorganization under the aegis of the 1987
Constitution is not as stern as reorganization under the prior Charter. Whereas
the latter, sans the President's subsequently imposed constraints, envisioned
a purgation, the same cannot be said of the reorganization inferred under
the new Constitution because, precisely, the new Constitution seeks to usher
in a democratic regime. But even if we concede ex gratia argumenti that
Section 16 is an exception to due process and no-removal-"except for cause
provided by law" principles enshrined in the very same 1987
Constitution, 79 which may possibly justify removals "not for cause," there
is no contradiction in terms here because, while the former Constitution left
the axe to fall where it might, the present organic act requires that removals
"not for cause" must be as a result of reorganization. As we observed, the
Constitution does not provide for "automatic" vacancies. It must also pass the
test of good faith — a test not obviously required under the revolutionary
government formerly prevailing, but a test well- established in democratic
societies and in this government under a democratic Charter.
When, therefore, Arroyo permitted a reorganization under Executive Order
No. 127 after the ratification of the 1987 Constitution, Arroyo permitted a
reorganization provided that it is done in good faith. Otherwise, security of
tenure would be an insuperable impediment. 80
Reorganizations in this jurisdiction have been regarded as valid provided they
are pursued in good faith. 81 As a general rule, a reorganization is carried out
in "good faith" if it is for the purpose of economy or to make bureaucracy
more efficient. In that event, no dismissal (in case of a dismissal) or
separation actually occurs because the position itself ceases to exist. And in
that case, security of tenure would not be a Chinese wall. Be that as it may,
if the "abolition," which is nothing else but a separation or removal, is done
for political reasons or purposely to defeat security of tenure, or otherwise
not in good faith, no valid "abolition" takes place and whatever "abolition" is
done, is void ab initio. There is an invalid "abolition" as where there is merely
a change of nomenclature of positions, 82 or where claims of economy are
belied by the existence of ample funds. 83
It is to be stressed that by predisposing a reorganization to the yardstick of
good faith, we are not, as a consequence, imposing a "cause" for
restructuring. Retrenchment in the course of a reorganization in good faith is
still removal "not for cause," if by "cause" we refer to "grounds" or conditions
that call for disciplinary action. ***
Good faith, as a component of a reorganization under a constitutional regime,
is judged from the facts of each case. However, under Republic Act No. 6656,
we are told:
SEC. 2. No officer or employee in the career service
shall be removed except for a valid cause and after due
notice and hearing. A valid cause for removal exists
when, pursuant to a bona fide reorganization, a position
has been abolished or rendered redundant or there is a
need to merge, divide, or consolidate positions in order
to meet the exigencies of the service, or other lawful
causes allowed by the Civil Service Law. The existence
of any or some of the following circumstances may be
considered as evidence of bad faith in the removals made
as a result of reorganization, giving rise to a claim for
reinstatement or reappointment by an aggrieved party:
(a) Where there is a significant increase in the number of
positions in the new staffing pattern of the department or
agency concerned; (b) Where an office is abolished and
another performing substantially the same functions is
created; (c) Where incumbents are replaced by those less
qualified in terms of status of appointment, performance
and merit; (d) Where there is a reclassification of offices
in the department or agency concerned and the
reclassified offices perform substantially the same
functions as the original offices; (e) Where the removal
violates the order of separation provided in Section 3
hereof. 84
It is in light hereof that we take up questions about Commissioner Mison's
good faith, or lack of it.
Reorganization of the Bureau of Customs,
Lack of Good Faith in. —
The Court finds that after February 2, 1987 no perceptible restructuring of
the Customs hierarchy — except for the change of personnel — has occurred,
which would have justified (all things being equal) the contested dismissals.
The contention that the staffing pattern at the Bureau (which would have
furnished a justification for a personnel movement) is the same staffing
pattern prescribed by Section 34 of Executive Order No. 127 already
prevailing when Commissioner Mison took over the Customs helm, has not
been successfully contradicted. 85 There is no showing that legitimate
structural changes have been made — or a reorganization actually
undertaken, for that matter — at the Bureau since Commissioner Mison
assumed office, which would have validly prompted him to hire and fire
employees. There can therefore be no actual reorganization to speak of, in the
sense, say, of reduction of personnel, consolidation of offices, or abolition
thereof by reason of economy or redundancy of functions, but a revamp of
personnel pure and simple. LLpr
The records indeed show that Commissioner Mison separated about 394
Customs personnel but replaced them with 522 as of August 18,
1988. 86 This betrays a clear intent to "pack" the Bureau of Customs. He did
so, furthermore, in defiance of the President's directive to halt further lay-offs
as a consequence of reorganization. 87 Finally, he was aware that lay-offs
should observe the procedure laid down by Executive Order No. 17.
We are not, of course, striking down Executive Order No. 127 for
repugnancy to the Constitution. While the act is valid, still and all, the means
with which it was implemented is not. 88
Executive Order No. 127, Specific Case of . —
With respect to Executive Order No. 127, Commissioner Mison submits that
under Section 59 thereof, "[t]hose incumbents whose positions are not
included therein or who are not reappointed shall be deemed separated from
the service." He submits that because the 394 removed personnel have not
been "reappointed," they are considered terminated. To begin with, the
Commissioner's appointing power is subject to the provisions of Executive
Order No. 39. Under Executive Order No. 39, the Commissioner of Customs
may "appoint all Bureau personnels except those appointed by the
President." 89
Accordingly, with respect to Deputy Commissioners Cesar Dario and
Vicente Feria, Jr., Commissioner Mison could not have validly terminated
them, they being Presidential appointees.
Secondly, and as we have asserted, Section 59 has been rendered inoperative
according to our holding in Palma-Fernandez.
That Customs employees, under Section 59 of Executive Order No. 127 had
been on a mere holdover status cannot mean that the positions held by them
had become vacant. In Palma-Fernandez, we said in no uncertain terms:
The argument that, on the basis of this provision,
petitioner's term of office ended on 30 January 1987 and
that she continued in the performance of her duties
merely in a hold-over capacity and could be transferred
to another position without violating any of her legal
rights, is untenable. The occupancy of a position in a
hold-over capacity was conceived to facilitate
reorganization and would have lapsed on 25 February
1987 (under the Provisional Constitution), but advanced
to February 2, 1987 when the 1987 Constitution became
effective (De Leon, et al., vs. Hon. Benjamin B.
Esquerra, et. al., G.R. No. 78059, 31 August 1987). After
the said date the provisions of the latter on security of
tenure govern. 90
It should be seen, finally, that we are not barring Commissioner Mison from
carrying out a reorganization under the transitory provisions of the 1987
Constitution. But such a reorganization should be subject to the criterion of
good faith.
Resume. —
In resume, we restate as follows:
1. The President could have validly removed government employees, elected
or appointed, without cause but only before the effectivity of the 1987
Constitution on February 2, 1987 (De Leon v. Esguerra, supra; Palma-
Fernandez vs. De la Paz, supra); in this connection, Section 59 (on non-
reappointment of incumbents) of Executive Order No. 127 cannot be a basis
for termination;
2. In such a case, dismissed employees shall be paid separation and retirement
benefits or upon their option be given reemployment opportunities
(CONST.[1987], art. XVIII, sec. 16; Rep. Act No. 6656, sec. 9);
3. From February 2, 1987, the State does not loss the right to reorganize the
Government resulting in the separation of career civil service employees
[CONST.(1987),supra] provided, that such a reorganization is made in good
faith. (Rep. Act No. 6656, supra.)
 G.R. No. 83737 THE EMPLOYEES WHOM COMMISSIONER MISON MAY HAVE
APPOINTED AS REPLACEMENTS ARE ORDERED TO VACATE
This disposition also resolves G.R. No. 83737. As we have indicated, G.R. THEIR POSTS SUBJECT TO THE PAYMENT OF WHATEVER
No. 83737 is a challenge to the validity of Republic Act No. 6656. In brief, it BENEFITS THAT MAY BE PROVIDED BY LAW.
is argued that the Act, insofar as it strengthens security of tenure 91 and as
far as it provides for a retroactive effect, 92 runs counter to the transitory NO COSTS.
provisions of the new Constitution on removals not for cause.
IT IS SO ORDERED.
It can be seen that the Act, insofar as it provides for reinstatement of
employees separated without "a valid cause and after due notice and Gutierrez, Jr., Paras, Gancayco, Bidin, Cortes, Griño-
hearing" 93 is not contrary to the transitory provisions of the new Aquino and Medialdea, JJ ., concur.
Constitution. The Court reiterates that although the Charter's transitory
provisions mention separations "not for cause," separations thereunder must
Padilla, J ., No part, related to counsel for respondent Abaca in G.R. No.
nevertheless be on account of a valid reorganization and which do not come
about automatically. Otherwise, security of tenure may be invoked. 85310.
Moreover, it can be seen that the statute itself recognizes removals without
cause. However, it also acknowledges the possibility of the leadership using
the artifice of reorganization to frustrate security of tenure. For this reason, it
has installed safeguards. There is nothing unconstitutional about the Act.

We recognize the injury Commissioner Mison's replacements would sustain.

We also commisserate with them. But our concern is the greater wrong
inflicted on the dismissed employees on account of their illegal separation
from the civil service.

WHEREFORE, THE RESOLUTIONS OF THE CIVIL SERVICE

COMMISSION, DATED JUNE 30, 1988, SEPTEMBER 20, 1988,
NOVEMBER 16, 1988, INVOLVED IN G.R. NOS. 85310, 85335, AND
86241, AND MAY 8, 1989, INVOLVED IN G.R. NO. 85310, ARE
AFFIRMED.

THE PETITIONS IN G.R. NOS. 81954, 81967, 82023, AND 85335 ARE
GRANTED. THE PETITIONS IN G.R. NOS. 83737, 85310 AND 86241
ARE DISMISSED.

THE COMMISSIONER OF CUSTOMS IS ORDERED TO REINSTATE

THE EMPLOYEES SEPARATED AS A RESULT OF HIS NOTICES
DATED JANUARY 26, 1988.
 FIRST DIVISION
[G.R. No. 152845. August 5, 2003.]
DRIANITA BAGAOISAN, FELY MADRIAGA,
SHIRLY TAGABAN, RICARDO SARANDI,
SUSAN IMPERIAL, BENJAMIN DEMDEM,
RODOLFO DAGA, EDGARDO BACLIG,
GREGORIO LABAYAN, HILARIO JEREZ, and
MARIA CORAZON CUANANG, petitioners, vs.
NATIONAL TOBACCO ADMINISTRATION,
Represented by ANTONIO DE GUZMAN and
PERLITA BAULA, respondents.
The Law Offices of Huerla Abesamis & Associates for petitioners.
Office of the Government Carporale Counsel for public respondent.
SYNOPSIS
President Joseph Estrada issued several Executive Orders reorganizing the
National Tobacco Administration (NTA). In compliance therewith, the
NTA prepared and adopted a new Organization Structure and Staffing
Pattern (OSSP). Petitioners were rank and file employees of NTA who were
terminated and were not considered in the OSSP. They filed a petition for
certiorari, prohibition and mandamus before the Regional Trial Court of
Batac, Ilocos Norte to enjoin the respondents from enforcing the notice of
termination addressed to the petitioners. The RTC decided in favor of
petitioners and thus ordered NTA to appoint petitioners in the new OSSP.
On appeal, the Court of Appeals reversed the RTC ruling. The Supreme
Court affirmed the appellate court's decision and denied the motion for
reconsideration.
Petitioners, therefore, filed this motion to admit petition for en banc
resolution of the case allegedly to address the legal and constitutional issue
of reorganizing NTA by an executive fiat and not by legislative action.
According to the Court, this involved neither an abolition nor transfer of
offices; the assailed action was merely reorganization under the general
provisions of the law consisting mainly of streamlining the NTA in the
interest of simplicity, economy and efficiency. It was, therefore, an act well
within the authority of the President motivated and carried out, according to
the findings of the appellate court, in good faith, a factual assessment
accepted by the Court.
As to petitioners' Motion for an En Banc Resolution of the Case, the Court
reminded counsel for petitioners that the Court En Banc is not an appellate
tribunal to which appeals from a Division of the Court may be taken.
Petitioners' motion was denied.
SYLLABUS
1. POLITICAL LAW; EXECUTIVE DEPARTMENT; PRESIDENT IS
EXPRESSLY GRANTED CONTROL THEREOF; APPLICATION IN
CASE AT BAR. — It is important to emphasize that the questioned
Executive Orders No. 29 and No. 36 have not abolished the National
Tobacco Administration but merely mandated its reorganization through
the streamlining or reduction of its personnel. Article VII, Section 17,
of the Constitution, expressly grants the President control of all executive
departments, bureaus, agencies and offices which may justify an executive
action to inactivate the functions of a particular office or to carry out
reorganization measures under a broad authority of law. Section 78 of the
General Provisions of Republic Act No. 8522 (General Appropriations Act
of FY 1998) has decreed that the President may direct changes in the
organization and key positions in any department, bureau or agency
pursuant to Article VI, Section 25, of the Constitution, which grants to the
Executive Department the authority to recommend the budget necessary for
its operation. Evidently, this grant of power includes the authority to
evaluate each and every government agency, including the determination of
the most economical and efficient staffing pattern, under the Executive
Department. In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon.
Ronaldo D. Zamora, in his capacity as the Executive Secretary, et al., this
Court has had occasion to also delve on the President's power to reorganize
the Office of the President under Section 31(2) and (3) of Executive Order
No. 292 and the power to reorganize the Office of the President Proper. The
Court has there .observed: ". . . .Under Section 31(1) of EO 292, the
President can reorganize the Office of the President Proper by abolishing,
consolidating or merging units, or by transferring functions from one unit to
another. In contrast, under Section 31(2) and (3) of EO 292, the President's
power to reorganize offices outside the Office of the President Proper but
still within the Office of the President is limited to merely transferring
functions or agencies from the Office of the President to Departments or
Agencies, and vice versa." The provisions of Section 31, Book III, Chapter
10, of Executive Order No. 292 (Administrative Code of 1987), above-
referred to, reads thusly: "SEC. 31. Continuing Authority of the President to
Reorganize his Office. — The President, subject to the policy in the
Executive Office and in order to achieve simplicity, economy and
efficiency, shall have continuing authority to reorganize the administrative
structure of the Office, of the President. For this purpose, he may take any
of the following actions: "(1) Restructure the internal organization of the
Office of the President Proper, including the immediate Offices, the
Presidential Special Assistants/Advisers System and the Common Staff
Support System, by abolishing, consolidating or merging units thereof or
transferring functions from one unit to another; "(2) Transfer any function
under the Office of the President to any other Department or Agency as well
as transfer functions to the Office of the President from other Departments
and Agencies; and "(3) Transfer any agency under the Office of the
President to any other department or agency as well as transfer agencies to
the Office of the President from other departments and agencies." The first
sentence of the law is an express grant to the President of a continuing
authority to reorganize the administrative structure of the Office of the
President. The succeeding numbered paragraphs are not in the nature of
provisos that unduly limit the aim and scope of the grant to the President of
the power to reorganize but are to be viewed in consonance therewith.
Section 31(1) of Executive Order No. 292 specifically refers to the
President's power to restructure the internal organization of the Office of the
President Proper, by abolishing, consolidating or merging units hereof or
transferring functions from one unit to another, while Section 31(2) and (3)
concern executive offices outside the Office of the
President Proper allowing the President to transfer any function under
the Office of the President to any other Department or Agency and vice-
versa, and the transfer of any agency under the Office of the President to
any other department or agency and vice-versa. In the present instance,
involving neither an abolition nor transfer of offices, the assailed action is a
mere reorganization under the general provisions of the law consisting
mainly of streamlining the NTA in the interest of simplicity, economy and
efficiency. It is an act well within the authority of President motivated and
carried out, according to the findings of the appellate court, in good faith, a
factual assessment that this Court could only but accept. ESTAIH
2. ID.; JUDICIARY; SUPREME COURT; THE COURT EN BANC IS
NOT AN APPELLATE TRIBUNAL TO WHICH APPEALS FROM A
DIVISION OF THE COURT MAY BE TAKEN. — The Court En Banc is
not an appellate tribunal to which appeals from a Division of the Court may
be taken. A Division of the Court is the Supreme Court as fully and
veritably as the Court En Banc itself and a decision of its Division is as
authoritative and final as a decision of the Court En Banc. Referrals of cases
from a Division to the Court En Banc do not take place as just a matter of
routine but only on such specified grounds as the Court in its discretion may
allow.
DECISION
VITUG, J p:
President Joseph Estrada issued on 30 September 1998 Executive Order No.
29, entitled "Mandating the Streamlining of the National Tobacco
Administration (NTA)," a government agency under the Department of
Agriculture. The order was followed by another issuance, on 27 October
1998, by President Estrada of Executive Order No. 36, amending Executive
Order No. 29, insofar as the new staffing pattern was concerned, by
increasing from four hundred (400) to not exceeding seven hundred fifty
(750) the positions affected thereby. In compliance therewith, the NTA
prepared and adopted a new Organization Structure and Staffing Pattern
(OSSP) which, on 29 October 1998, was submitted to the Office of the
President.
On 11 November 1998, the rank and file employees of NTA Batac, among
whom included herein petitioners, filed a letter-appeal with the Civil
Service Commission and sought its assistance in recalling the OSSP. On 04
December 1998, the OSSP was approved by the Department of Budget and
Management (DBM) subject to certain revisions. On even date, the NTA
created a placement committee to assist the appointing authority in the
selection and placement of permanent personnel in the revised OSSP. The
results of the evaluation by the committee on the individual qualifications of
applicants to the positions in the new OSSP were then disseminated and
posted at the central and provincial offices of the NTA. CcAIDa
On 10 June 1996, petitioners, all occupying different positions at the NTA
office in Batac, Ilocos Norte, received individual notices of termination of
their employment with the NTA effective thirty (30) days from receipt
thereof. Finding themselves without any immediate relief from their
dismissal from the service, petitioners filed a petition forcertiorari,
prohibition and mandamus, with prayer for preliminary mandatory
injunction and/or temporary restraining order, with the Regional Trial Court
(RTC) of Batac, Ilocos Norte, and prayed —
"1) that a restraining order be immediately issued
enjoining the respondents from enforcing the notice of
termination addressed individually to the petitioners
and/or from committing further acts of dispossession
and/or ousting the petitioners from their respective
offices;
"2) that a writ of preliminary injunction be issued
against the respondents, commanding them to maintain
the status quo to protect the rights of the petitioners
pending the determination of the validity of the
implementation of their dismissal from the service; and
"3) that, after trial on the merits, judgment be rendered
declaring the notice of termination of the petitioners
illegal and the reorganization null and void and
ordering their reinstatement with backwages, if
applicable, commanding the respondents to desist from
further terminating their services, and making the
injunction permanent." 1
The RTC, on 09 September 2000, ordered the NTA to appoint petitioners in
the new OSSP to positions similar or comparable to their respective former
assignments. A motion for reconsideration filed by the NTA was denied by
the trial court in its order of 28 February 2001. Thereupon, the NTA filed an
appeal with the Court of Appeals, raising the following issues:
"I. Whether or not respondents submitted evidence as
proof that petitioners, individually, were not
the 'best qualified and most deserving' among
the incumbent applicant-employees.
"II. Whether or not incumbent permanent employees,
including herein petitioners, automatically
enjoy a preferential right and the right of first
refusal to appointments/reappointments in the
new Organization Structure And Staffing
Pattern (OSSP) of respondent NTA.
"III. Whether or not respondent NTA in implementing
the mandated reorganization pursuant to E.O.
No. 29, as amended by E.O. No. 36, strictly
adhere to the implementing rules on
reorganization, particularly RA 6656 and of
the Civil Service Commission — Rules on
Government Reorganization.
"IV. Whether or not the validity of E.O. Nos. 29 and 36
can be put in issue in the instant
case/appeal." 2
On 20 February 2002, the appellate court rendered a decision reversing
and setting aside the assailed orders of the trial court.
Petitioners went to this Court to assail the decision of the Court of Appeals,
contending that —
"I. The Court of Appeals erred in making a finding that
went beyond the issues of the case and which
are contrary to those of the trial court and that
it overlooked certain relevant facts not
disputed by the parties and which, if properly
 considered, would justify a different
conclusion;
"II. The Court of Appeals erred in upholding Executive
Order Nos. 29 and 36 of the Office of the
President which are mere administrative
issuances which do not have the force and
effect of a law to warrant abolition of positions
and/or effecting total reorganization;
"III. The Court of Appeals erred in holding that
petitioners' removal from the service is in
accordance with law;
"IV. The Court of Appeals erred in holding that
respondent NTA was not guilty of bad faith in
the termination of the services of petitioners;
(and)
"V. The Court of Appeals erred in ignoring case
law/jurisprudence in the abolition of an
office." 3
In its resolution of 10 July 2002, the Court required the NTA to file its
comment on the petition. On 18 November 2002, after the NTA had
filed its comment of 23 September 2002, the Court issued its resolution
denying the petition for failure of petitioners to sufficiently show any
reversible error on the part of the appellate court in its challenged
decision so as to warrant the exercise by this Court of its discretionary
appellate jurisdiction. A motion for reconsideration filed by petitioners
was denied in the Court's resolution of 20 January 2002.
On 21 February 2003, petitioners submitted a "Motion to Admit Petition
For En Banc Resolution" of the case allegedly to address a basic
question, i.e., "the legal and constitutional issue on whether the NTA may
be reorganized by an executive fiat, not by legislative action." 4 In their
"Petition for an En Banc Resolution" petitioners would have it that —
"1. The Court of Appeals' decision upholding the
reorganization of the National Tobacco Administration
sets a dangerous precedent in that:
"'a) A mere Executive Order issued by the
Office of the President and procured by a
government functionary would have the effect
of a blanket authority to reorganize a bureau,
office or agency attached to the various
executive departments;
'b) The President of the Philippines would
have the plenary power to reorganize the entire
government Bureaucracy through the issuance
of an Executive Order, an administrative
issuance without the benefit of due
deliberation, debate and discussion of
members of both chambers of the Congress of
the Philippines;
'c) The right to security of tenure to a career
position created by law or statute would be
defeated by the mere adoption of an
Organizational Structure and Staffing Pattern
issued pursuant to an Executive Order which is
not a law and could thus not abolish an office
created by law;
"2. The case law on abolition of an office would be
disregarded, ignored and abandoned if the Court of
Appeals decision subject matter of this Petition would
remain undisturbed and untouched. In other words,
previous doctrines and precedents of this Highest Court
would in effect be reversed and/or modified with the
Court of Appeals judgment, should it remain
unchallenged.
"3. Section 4 of Executive Order No. 245 dated July 24,
1987 (Annex 'D,' Petition), issued by the Revolutionary
 government of former President Corazon Aquino, and
the law creating NTA, which provides that the
governing body of NTA is the Board of Directors,
would be rendered meaningless, ineffective and a dead
letter law because the challenged NTA reorganization
which was erroneously upheld by the Court of Appeals
was adopted and implemented by then NTA
Administrator Antonio de Guzman without the
corresponding authority from the Board of Directors as
mandated therein. In brief, the reorganization is an ultra
vires act of the NTA Administrator.
"4. The challenged Executive Order No. 29 issued by
former President Joseph Estrada but unsigned by then
Executive Secretary Ronaldo Zamora would in effect
be erroneously upheld and given legal effect as to
supersede, amend and/or modify Executive Order No.
245, a law issued during the Freedom Constitution of
President Corazon Aquino. In brief, a mere executive
order would amend, supersede and/or render ineffective
a law or statute." 5
In order to allow the parties a full opportunity to ventilate their views on the
matter, the Court ultimately resolved to hear the parties in oral argument.
Essentially, the core question raised by them is whether or not the President,
through the issuance of an executive order, can validly carry out the
reorganization of the NTA.
Notwithstanding the apparent procedural lapse on the part of petitioner to
implead the Office of the President as party respondent pursuant to Section
7, Rule 3, of the 1997 Revised Rules of Civil Procedure, 6 this Court
resolved to rule on the merits of the petition.
Buklod ng Kawaning EIIB vs. Zamora 7 ruled that the President, based on
existing laws, had the authority to carry out a reorganization in any branch
or agency of the executive department. In said case, Buklod ng Kawaning
EIIB challenged the issuance, and sought the nullification, of Executive
Order No. 191 (Deactivation of the Economic Intelligence and Investigation
Bureau) and Executive Order No. 223 (Supplementary Executive Order No.
191 on the Deactivation of the Economic Intelligence and Investigation
Bureau and for Other Matters) on the ground that they were issued by the
President with grave abuse of discretion and in violation of their
constitutional right to security of tenure. The Court explained:
"The general rule has always been that the power to
abolish a public office is lodged with the legislature.
This proceeds from the legal precept that the power to
create includes the power to destroy. A public office is
either created by the Constitution, by statute, or by
authority of law. Thus, except where the office was
created by the Constitution itself, it may be abolished
by the same legislature that brought it into existence.
"The exception, however, is that as far as bureaus,
agencies or offices in the executive department are
concerned, the President's power of control may justify
him to inactivate the functions of a particular office, or
certain laws may grant him the broad authority to carry
out reorganization measures. The case in point is Larin
v. Executive Secretary [280 SCRA 713]. In this case, it
was argued that there is no law which empowers the
President to reorganize the BIR. In decreeing otherwise,
this Court sustained the following legal basis, thus:
"'Initially, it is argued that there is no law yet
which empowers the President to issue E.O.
No. 132 or to reorganize the BIR.
'We do not agree.
'xxx xxx xxx
'Section 48 of R.A. 7645 provides
that: SEIDAC
"Sec. 48. Scaling Down and Phase Out of
Activities of Agencies Within the Executive
Branch. — The heads of departments, bureaus
and offices and agencies are hereby directed to
identify their respective activities which are no
longer essential in the delivery of public
services and which may be scaled down,
phased out or abolished, subject to civil
service rules and regulations. . . . Actual
scaling down, phasing out or abolition of the
activities shall be effected pursuant to
Circulars or Orders issued for the purpose by
the Office of the President.'
'Said provision clearly mentions the acts of
'scaling down, phasing out and abolition' of
offices only and does not cover the creation of
offices or transfer of functions. Nevertheless,
the act of creating and decentralizing is
included in the subsequent provision of
Section 62 which provides that:
"Sec. 62. Unauthorized organizational
changes. — Unless otherwise created by law
or directed by the President of the Philippines,
no organizational unit or changes in key
positions in any department or agency shall be
authorized in their respective organization
structures and be funded from appropriations
by this Act.'
'The foregoing provision evidently shows that
the President is authorized to effect
organizational changes including the creation
of offices in the department or agency
concerned.
'xxx xxx xxx
'Another legal basis of E.O. No. 132 is Section
20, Book III of E.O. No. 292 which states:
"Sec. 20. Residual Powers. — Unless
Congress provides otherwise, the President
shall exercise such other powers and functions
vested in the President which are provided for
under the laws and which are not specifically
enumerated above or which are not delegated
by the President in accordance with law.'
'This provision speaks of such other powers
vested in the President under the law. What
law then gives him the power to reorganize? It
is Presidential Decree No. 1772 which
amended Presidential Decree No. 1416. These
decrees expressly grant the President of the
Philippines the continuing authority to
reorganize the national government, which
includes the power to group, consolidate
bureaus and agencies, to abolish offices, to
transfer functions, to create and classify
functions, services and activities and to
standardize salaries and materials. The
validity of these two decrees are
unquestionable. The 1987 Constitution clearly
provides that 'all laws, decrees, executive
orders, proclamations, letter of instructions
and other executive issuances not inconsistent
with this Constitution shall remain operative
until amended, repealed or revoked. So far,
there is yet no law amending or repealing said
decrees.'
"Now, let us take a look at the assailed executive order.
"In the whereas clause of E.O. No. 191, former
President Estrada anchored his authority to deactivate
EIIB on Section 77 of Republic Act 8745 (FY 1999
General Appropriations Act), a provision similar to
Section 62 of R.A. 7645 quoted in Larin, thus:
"'Sec. 77. Organized Changes.
— Unless otherwise provided by law
or directed by the President of the Philippines,
no changes in key positions or organizational
units in any department or agency shall be
authorized in their respective organizational
structures and funded from appropriations
provided by this Act.'
"We adhere to the . . . ruling in Larin that this provision
recognizes the authority of the President to effect
organizational changes in the department or agency
under the executive structure. Such a ruling further
finds support in Section 78 of Republic Act No. 8760.
Under this law, the heads of departments, bureaus,
offices and agencies and other entities in the Executive
Branch are directed (a) to conduct a comprehensive
review of this respective mandates, missions,
objectives, functions, programs, projects, activities and
systems and procedures; (b) identify activities which
are no longer essential in the delivery of public services
and which may be scaled down, phased-out or
abolished; and (c) adopt measures that will result in the
streamlined organization and improved overall
performance of their respective agencies. Section 78
ends up with the mandate that the actual streamlining
and productivity improvement in agency organization
and operation shall be effected pursuant to Circulars or
Orders issued for the purpose by the Office of the
President. The law has spoken clearly. We are left only
with the duty to sustain.
"But of course, the list of legal basis authorizing the
President to reorganize any department or agency in the
executive branch does not have to end here. We must
not lose sight of the very source of the power — that
which constitutes an express grant of power. Under
Section 31, Book III of Executive Order No.
292 (otherwise known as the Administrative Code of
1987), 'the President, subject to the policy in the
Executive Office and in order to achieve simplicity,
economy and efficiency, shall have the continuing
authority to reorganize the administrative structure of
the Office of the President.' For this purpose, he may
transfer the functions of other Departments or Agencies
to the Office of the President. In Canonizado vs.
Aguirre [323 SCRA 312], we ruled that reorganization
'involves the reduction of personnel, consolidation of
offices, or abolition thereof by reason of economy or
redundancy of functions.' It takes place when there is an
alteration of the existing structure of government
offices or units therein, including the lines of control,
authority and responsibility between them. The EIIB is
a bureau attached to the Department of Finance. It falls
under the Office of the President. Hence, it is subject to
the President's continuing authority to reorganize.
"It having been duly established that the President has
the authority to carry out reorganization in any branch
or agency of the executive department, what is then left
for us to resolve is whether or not the reorganization is
valid. In this jurisdiction, reorganizations have been
regarded as valid provided they are pursued in good
faith. Reorganization is carried out in 'good faith' if it is
for the purpose of economy or to make bureaucracy
more efficient. Pertinently, Republic Act No.
6656provides for the circumstances which may be
considered as evidence of bad faith in the removal of
civil service employees made as a result of
reorganization, to wit: (a) where there is a significant
increase in the number of positions in the new staffing
pattern of the department or agency concerned; (b)
where an office is abolished and another performing
substantially the same functions is created; (c) where
incumbents are replaced by those less qualified in terms
of status of appointment, performance and merit; (d)
where there is a classification of offices in the
 department or agency concerned and the reclassified
offices perform substantially the same functions as the
original offices, and (e) where the removal violates the
order of separation." 8
The Court of Appeals, in its now assailed decision, has found no evidence
of bad faith on the part of the NTA; thus —
"In the case at bar, we find no evidence that the
respondents committed bad faith in issuing the notices
of non-appointment to the petitioners.
"Firstly, the number of positions in the new staffing
pattern did not increase. Rather, it decreased from 1,125
positions to 750. It is thus natural that one's position
may be lost through the removal or abolition of an
office.
"Secondly, the petitioners failed to specifically show
which offices were abolished and the new ones that
were created performing substantially the same
functions.
"Thirdly, the petitioners likewise failed to prove that
less qualified employees were appointed to the
positions to which they applied.
"xxx xxx xxx
"Fourthly, the preference stated in Section 4 of R.A.
6656, only means that old employees should be
considered first, but it does not necessarily follow that
they should then automatically be appointed. This is
because the law does not preclude the infusion of new
blood, younger dynamism, or necessary talents into the
government service, provided that the acts of the
appointing power are bonafide for the best interest of
the public service and the person chosen has the needed
qualifications." 9
These findings of the appellate court are basically factual which this
Court must respect and be held bound.
It is important to emphasize that the questioned Executive Orders No. 29
and No. 36 have not abolished the National Tobacco Administration but
merely mandated its reorganization through the streamlining or reduction
of its personnel. Article VII, Section 17, 10 of the Constitution, expressly
grants the President control of all executive departments, bureaus, agencies
and offices which may justify an executive action to inactivate the functions
of a particular office or to carry out reorganization measures under a broad
authority of law. 11 Section 78 of the General Provisions of Republic Act
No. 8522 (General Appropriations Act of FY 1998) has decreed that the
President may direct changes in the organization and key positions in any
department, bureau or agency pursuant to Article VI, Section 25, 12 of the
Constitution, which grants to the Executive Department the authority to
recommend the budget necessary for its operation. Evidently, this grant of
power includes the authority to evaluate each and every government
agency, including the determination of the most economical and efficient
staffing pattern, under the Executive Department. caIDSH
In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon. Ronaldo D.
Zamora, in his capacity as the Executive Secretary, et al., 13 this Court has
had occasion to also delve on the President's power to reorganize the Office
of the President under Section 31(2) and (3) of Executive Order No.
292 and the power to reorganize the Office of the PresidentProper. The
Court has there observed:
". . . Under Section 31(1) of EO 292, the President can
reorganize the Office of the President Proper by
abolishing, consolidating or merging units, or by
transferring functions from one unit to another. In
contrast, under Section 31(2) and (3) of EO 292, the
President's power to reorganize offices outside the
Office of the PresidentProper but still within the Office
of the President is limited to merely transferring
functions or agencies from the Office of the President
to Departments or Agencies, and vice versa."
The provisions of Section 31, Book III, Chapter 10, of Executive Order
No. 292 (Administrative Code of 1987), above-referred to, reads
thusly:
"SEC. 31. Continuing Authority of the President to
Reorganize his Office. — The President, subject to the
policy in the Executive Office and in order to achieve
simplicity, economy and efficiency, shall have
continuing authority to reorganize the administrative
structure of the Office of the President. For this
purpose, he may take any of the following actions:
"(1) Restructure the internal organization of
the Office of the President Proper, including
the immediate Offices, the Presidential Special
Assistants/Advisers System and the Common
Staff Support System, by abolishing,
consolidating or merging units thereof or
transferring functions from one unit to another;
"(2) Transfer any function under the Office of
the President to any other Department or
Agency as well as transfer functions to the
Office of the President from other
Departments and Agencies; and
"(3) Transfer any agency under the Office of
the President to any other department or
agency as well as transfer agencies to the
Office of the President from other departments
and agencies."
The first sentence of the law is an express grant to the President of
a continuing authority to reorganize the administrative structure of the
Office of the President. The succeeding numbered paragraphs are not in
the nature of provisos that unduly limit the aim and scope of the grant
to the President of the power to reorganize but are to be viewed in
consonance therewith. Section 31(1) of Executive Order No.
292 specifically refers to the President's power to restructure the
internal organization of the Office of the President Proper, by
abolishing, consolidating or merging units hereof or transferring
functions from one unit to another, while Section 31(2) and (3) concern
executive offices outside the Office of the President Proper allowing
the President to transfer any function under the Office of the President
to any other Department or Agency and vice-versa, and the transfer of
any agency under the Office of the President to any other department or
agency and vice-versa. 14
In the present instance, involving neither an abolition nor transfer of offices,
the assailed action is a mere reorganization under the general provisions of
the law consisting mainly of streamlining the NTA in the interest of
simplicity, economy and efficiency. It is an act well within the authority of
President motivated and carried out, according to the findings of the
appellate court, in good faith, a factual assessment that this Court could
only but accept. 15
In passing, relative to petitioners' "Motion for an En Banc Resolution of the
Case," it may be well to remind counsel, that the Court En Banc is not an
appellate tribunal to which appeals from a Division of the Court may be
taken. A Division of the Court is the Supreme Court as fully and veritably
as the Court En Banc itself and a decision of its Division is as authoritative
and final as a decision of the Court En Banc. Referrals of cases from a
Division to the Court En Banc do not take place as just a matter of routine
but only on such specified grounds as the Court in its discretion may
allow. 16
WHEREFORE, the Motion to Admit Petition for En Banc resolution and
the Petition for an En Banc Resolution are DENIED for lack of merit. Let
entry of judgment be made in due course. No costs.
SO ORDERED.
Davide, Jr., C .J ., Ynares-Santiago, Carpio and Azcuna. JJ ., concur.
 EN BANC Procedural flaws like the disregard of hierarchy of courts and non-
exhaustion of administrative remedies may be ignored where the demands
[G.R. Nos. 142801-802. July 10, 2001.] of public interest requires it as where the status and existence of public
office is in issue.

BUKLOD NG KAWANING EIIB, CESAR
POSADA, REMEDIOS G. PRINCESA,
BENJAMIN KHO, BENIGNO MANGA, LULU
MENDOZA, petitioners, vs. HON. EXECUTIVE
SECRETARY RONALDO B. ZAMORA, HON.
SECRETARY JOSE PARDO, DEPARTMENT OF
FINANCE, HON. SECRETARY BENJAMIN
DIOKNO, DEPARTMENT OF BUDGET AND
MANAGEMENT, HON. SECRETARY ARTEMIO
TUQUERO, DEPARTMENT OF
JUSTICE, respondents.
Public Interest Law Center for petitioners.
The Solicitor General for respondents.
SYNOPSIS
The Economic Intelligence and Investigation Bureau (EIIB) of the Ministry
of Finance was created on June 30, 1987 by Executive Order No. 127. On
January 7, 2000, then President Joseph Estrada issued Executive Order No.
191 deactivating the EIIB. Its function was transferred to the newly created
Task Force Aduana which utilized the personnel, facilities and resources of
existing departments, agencies and bureaus. Thus, no new employees were
hired. Its personnel came from other agencies and detailed with the Task
Force. On March 29, 2000, Executive Order No. 223 was issued separating
all EIIB personnel from the service effective April 30, 2000. Aggrieved,
petitioners, employees of the EIIB, without exhausting administrative
remedies and the hierarchy of courts, resorted to this recourse challenging
Executive Orders Nos. 191 and 223 as violative of their right to security of
tenure and usurpation by the President of the power of Congress to abolish
public office.
The general rule is that the power to abolish a public office lies with the
Legislature. However, the President by virtue of Section 31, Book III of
Executive Order No. 292(Administrative Code of 1987), Section 48 of R.A.
7645, Section 20, Book III of E.O. No. 292, and Section 78 of R.A. 8760,
may abolish, in good faith, bureaus, agencies or offices. EICSTa
Where an office is abolished to achieve the ultimate purpose of economy, as
in the case at bar, the same is made in good faith.
SYLLABUS
1. REMEDIAL LAW; ACTIONS; PROCEDURAL FLAWS MAY BE
DISREGARDED WHERE PUBLIC INTEREST DEMANDS IT. —
Despite the presence of some procedural flaws in the instant petition, such
as, petitioners' disregard of the hierarchy of courts and the non-exhaustion
of administrative remedies, we deem it necessary to address the issues. It is
in the interest of the State that questions relating to the status and existence
of a public office be settled without delay. We are not without precedent.
2. ADMINISTRATIVE LAW; PUBLIC OFFICE; "DEACTIVATE" AND
"ABOLISH," DISTINGUISHED. — Surely, there exists a distinction
between the words "deactivate" and "abolish." To "deactivate" means to
render inactive or ineffective or to break up by discharging or reassigning
personnel, while to "abolish" means to do away with, to annul, abrogate or
destroy completely. In essence, abolition denotes an intention to do away
with the office wholly and permanently. Thus, while in abolition, the office
ceases to exist, the same is not true in deactivation where the office
continues to exist, albeit remaining dormant or inoperative. Be that as it
may, deactivation and abolition are both reorganization measures.
3. ID.; ID.; POWER TO ABOLISH PUBLIC OFFICE, AS A GENERAL
RULE, LODGED WITH THE LEGISLATURE. — The general rule has
always been that the power to abolish a public office is lodged with the
legislature. This proceeds from the legal precept that the power to create
includes the power to destroy. A public office is either created by the
Constitution, by statute, or by authority of law. Thus, except where the
office was created by the Constitution itself, it may be abolished by the
same legislature that brought it into existence.
4. ID.; ID.; ID.; EXCEPTION. — The exception, however, is that as far as
bureaus, agencies or offices in the executive department are concerned, the
President's power of control may justify him to inactivate the functions of a
particular office, or certain laws may grant him the broad authority to carry
out reorganization measures. The case in point is Larin v. Executive
Secretary.
5. CONSTITUTIONAL LAW; PRESIDENT; WITH AUTHORITY TO
EFFECT ORGANIZATIONAL CHANGES, INCLUDING ABOLITION,
IN EXECUTIVE DEPARTMENT OR AGENCY; BASIS. — We adhere to
the precedent or ruling in Larin that this provision recognizes the authority
of the President to effect organizational changes in the department or
agency under the executive structure. Such a ruling further finds support in
Section 78 of Republic Act No. 8760. Under this law, the heads of
departments, bureaus, offices and agencies and other entities in the
Executive Branch are directed (a) to conduct a comprehensive review of
their respective mandates, missions, objectives, functions, programs,
projects, activities and systems and procedures; (b) identify activities which
are no longer essential in the delivery of public services and which may be
scaled down, phased-out or abolished; and (c) adopt measures that will
result in the streamlined organization and improved overall performance of
their respective agencies. Section 78 ends up with the mandate that
the actual streamlining and productivity improvement in agency
organization and operation shall be effected pursuant to Circulars or
Orders issued for the purpose by the Office of the President. The law has
spoken clearly. We are left only with the duty to sustain. But of course, the
list of legal basis authorizing the President to reorganize any department or
agency in the executive branch does not have to end here. We must not lose
sight of the very source of the power — that which constitutes an express
grant of power. Under Section 31, Book III of Executive Order No.
292 (otherwise known as the Administrative Code of 1987), "the President,
subject to the policy in the Executive Office and in order to achieve
simplicity, economy and efficiency, shall have the continuing authority to
reorganize the administrative structure of the Office of the President." For
this purpose, he may transfer the functions of other Departments or
Agencies to the Office of the President. In Canonizado v. Aguirre, we ruled
that reorganization "involves the reduction of personnel, consolidation of
offices, or abolition thereof by reason of economy or redundancy of
functions." It takes place when there is an alteration of the existing structure
of government offices or units therein, including the lines of control,
authority and responsibility between them. The EIIB is a bureau attached to
the Department of Finance. It falls under the Office of the President. Hence,
it is subject to the President's continuing authority to reorganize. HIaTDS
6. ADMINISTRATIVE LAW; PUBLIC OFFICE; REORGANIZATION
CARRIED OUT IN GOOD FAITH, VALID. — In this jurisdiction,
reorganizations have been regarded as valid provided they are pursued in
good faith. Reorganization is carried out in 'good faith' if it is for the
purpose of economy or to make bureaucracy more efficient.
7. ID.; ID.; ID.; DEACTIVATION OF EIIB AND CREATION OF TASK
FORCE ADUANA, MADE IN GOOD FAITH. — An examination of the
pertinent Executive Orders shows that the deactivation of EIIB and the
creation of Task Force Aduana were done in good faith. It was not for the
purpose of removing the EIIB employees, but to achieve the ultimate
purpose of E.O. No. 191, which is economy. While Task Force Aduana was
created to take the place of EIIB, its creation does not entail expense to the
government. There is no employment of new personnel to man the Task
Force. E.O. No. 196 provides that the technical, administrative and special
staffs of EIIB are to be composed of people who are already in the public
service, they being employees of other existing agencies. Obviously, the
idea is to encourage the utilization of personnel, facilities and resources of
the already existing departments, agencies, bureaus, etc., instead of
maintaining an independent office with a whole set of personnel and
facilities. It is evident from the yearly budget appropriation of the
government that the creation of the Task Force Aduana was especially
intended to lessen EIIB's expenses.
8. ID.; ID.; ABOLITION OF OFFICE; DOES NOT CURTAIL RIGHT TO
SECURITY OF TENURE. — We hold that petitioners' right to security of
tenure is not violated. Nothing is better settled in our law than that the
abolition of an office within the competence of a legitimate body if done in
good faith suffers from no infirmity. Valid abolition of offices is neither
removal nor separation of the incumbents. EIASDT
9. ID.; ID.; EXCEPT IN CONSTITUTIONAL OFFICES, NO ONE HAS
VESTED RIGHT IN AN OFFICE OR ITS SALARY. — Indeed, there is
no such thing as an absolute right to hold office. Except constitutional
offices which provide for special immunity as regards salary and tenure, no
one can be said to have any vested right in an office or its salary.
DECISION
SANDOVAL-GUTIERREZ, J p:
In this petition for certiorari, prohibition and mandamus,
petitioners Buklod Ng Kawaning EIIB, Cesar Posada, Remedios Princesa,
Benjamin Kho, Benigno Manga and Lulu Mendoza, for themselves and in
behalf of others with whom they share a common or general interest, seek
the nullification of Executive Order No. 191 1 and Executive Order
No. 223 2 on the ground that they were issued by the Office of the President
with grave abuse of discretion and in violation of their constitutional right
to security of tenure.
The facts are undisputed:
On June 30, 1987, former President Corazon C. Aquino, issued Executive
Order No. 127 3 establishing the Economic Intelligence and Investigation
Bureau (EIIB) as part of the structural organization of the Ministry of
Finance. 4 The EIIB was designated to perform the following functions:
"(a) Receive, gather and evaluate intelligence reports
and information and evidence on the nature, modes and
extent of illegal activities affecting the national
economy, such as, but not limited to, economic
sabotage, smuggling, tax evasion, and dollar-salting,
investigate the same and aid in the prosecution of cases;
(b) Coordinate with external agencies in monitoring the
financial and economic activities of persons or entities,
whether domestic or foreign, which may adversely
affect national financial interest with the goal of
regulating, controlling or preventing said activities;
(c) Provide all intelligence units of operating Bureaus
or Offices under the Ministry with the general
framework and guidelines in the conduct of intelligence
and investigating works;
(d) Supervise, monitor and coordinate all the
intelligence and investigation operations of the
operating Bureaus and Offices under the Ministry;
(e) Investigate, hear and file, upon clearance by the
Minister, anti-graft and corruption cases against
personnel of the Ministry and its constituents units;
(f) Perform such other appropriate functions as may be
assigned by the Minister or his deputies." 5
In a desire to achieve harmony of efforts and to prevent possible conflicts
among agencies in the course of their anti-smuggling operations, President
Aquino issuedMemorandum Order No. 225 on March 17, 1989, providing,
among others, that the EIIB "shall be the agency of primary responsibility
for anti-smuggling operations in all land areas and inland waters and
waterways outside the areas of sole jurisdiction of the Bureau of
Customs." 6
Eleven years after, or on January 7, 2000, President Joseph Estrada
issued Executive Order No. 191 entitled "Deactivation of the Economic
Intelligence and Investigation Bureau." 7 Motivated by the fact that "the
designated functions of the EIIB are also being performed by the other
existing agencies of the government" and that "there is a need to constantly
monitor the overlapping of functions" among these agencies, former
President Estrada ordered the deactivation of EIIB and the transfer of its
functions to the Bureau of Customs and the National Bureau of
Investigation.
Meanwhile, President Estrada issued Executive Order No. 196 8 creating
the Presidential Anti-Smuggling Task Force "Aduana." 9
Then the day feared by the EIIB employees came. On March 29, 2000,
President Estrada issued Executive Order No. 223 10 providing that
all EIIB personnel occupying positions specified therein shall be deemed
separated from the service effective April 30, 2000, pursuant to a bona
fide reorganization resulting to abolition, redundancy, merger, division, or
consolidation of positions. 11
Agonizing over the loss of their employment, petitioners now come before
this Court invoking our power of judicial review of Executive Order
Nos. 191 and 223. They anchor their petition on the following arguments:
"A
Executive Order Nos. 191 and 223 should be annulled
as they are unconstitutional for being violative
of Section 2(3), Article IX-B of the Philippine
Constitution and/or for having been issued with grave
abuse of discretion amounting to lack or excess of
jurisdiction.
B.
The abolition of the EIIB is a hoax. Similarly, if
Executive Order Nos. 191 and 223 are considered to
effect a reorganization of the EIIB, such reorganization
was made in bad faith.
C.
The President has no authority to abolish the EIIB."
Petitioners contend that the issuance of the afore-mentioned executive
orders is: (a) a violation of their right to security of tenure; (b) tainted with
bad faith as they were not actually intended to make the bureaucracy more
efficient but to give way to Task Force "Aduana," the functions of which
are essentially and substantially the same as that ofEIIB; and (c) a
usurpation of the power of Congress to decide whether or not to abolish
the EIIB.
Arguing in behalf of respondents, the Solicitor General maintains that: (a)
the President enjoys the totality of the executive power provided
under Sections 1 and 7, Article VII of the Constitution, thus, he has the
authority to issue Executive Order Nos. 191 and 223; (b) the said executive
orders were issued in the interest of national economy, to avoid duplicity of
work and to streamline the functions of the bureaucracy; and (c)
the EIIB was not "abolished," it was only "deactivated."
The petition is bereft of merit. DcICEa
Despite the presence of some procedural flaws in the instant petition, such
as, petitioners' disregard of the hierarchy of courts and the non-exhaustion
of administrative remedies, we deem it necessary to address the issues. It is
in the interest of the State that questions relating to the status and existence
of a public office be settled without delay. We are not without precedent.
In Dario v. Mison, 12 we liberally decreed:
"The Court disregards the questions raised as to
procedure, failure to exhaust administrative remedies,
the standing of certain parties to sue, for two
reasons,'[b]ecause of the demands of public interest,
including the need for stability in the public
service,' and because of the serious implications of
these cases on the administration of the Philippine civil
service and the rights of public servants."
At first glance, it seems that the resolution of this case hinges on the
question — Does the "deactivation" of EIIB constitute "abolition" of an
office? However, after coming to terms with the prevailing law and
jurisprudence, we are certain that the ultimate queries should be — a) Does
the President have the authority to reorganize the executive department?
and, b) How should the reorganization be carried out?
Surely, there exists a distinction between the words "deactivate" and
"abolish." To "deactivate" means to render inactive or ineffective or to
break up by discharging or reassigning personnel, 13 while to "abolish"
means to do away with, to annul, abrogate or destroy completely. 14 In
essence, abolition denotes an intention to do away with the
office wholly and permanently. 15 Thus, while in abolition, the office
ceases to exist, the same is not true in deactivation where the office
continues to exist, albeit remaining dormant or inoperative. Be that as it
may, deactivation and abolition are both reorganization measures.
The Solicitor General only invokes the above distinctions on the mistaken
assumption that the President has no power to abolish an office.
The general rule has always been that the power to abolish a public office is
lodged with the legislature. 16 This proceeds from the legal precept that the
power to create includes the power to destroy. A public office is either
created by the Constitution, by statute, or by authority of law. 17 Thus,
except where the office was created by the Constitution itself, it may be
abolished by the same legislature that brought it into existence. 18
The exception, however, is that as far as bureaus, agencies or offices in the
executive department are concerned, the President's power of control may
justify him to inactivate the functions of a particular office, 19 or certain
laws may grant him the broad authority to carry out reorganization
measures. 20 The case in point is Larin v. Executive Secretary. 21 In this
case, it was argued that there is no law which empowers the President to
reorganize the BIR. In decreeing otherwise, this Court sustained the
following legal basis, thus:
"Initially, it is argued that there is no law yet which
empowers the President to issue E.O. No. 132 or to
reorganize the BIR.
We do not agree.
xxx xxx xxx
Section 48 of R.A. 7645 provides that:
'SECTION 48. Scaling Down and Phase Out of
Activities of Agencies Within the Executive Branch. —
The heads of departments, bureaus and offices and
agencies are hereby directed to identify their respective
activities which are no longer essential in the delivery
of public services and which may be scaled down,
phased out or abolished, subject to civil service rules
and regulations. . . Actual scaling down, phasing out or
abolition of the activities shall be effected pursuant to
Circulars or Orders issued for the purpose by the Office
of the President.'
Said provision clearly mentions the acts of "scaling
down, phasing out and abolition" of offices only and
does not cover the creation of offices or transfer of
functions. Nevertheless, the act of creating and
decentralizing is included in the subsequent provision
of Section 62 which provides that:
'SECTION 62. Unauthorized organizational charges.
— Unless otherwise created by law or directed by the
President of the Philippines, no organizational unit or
changes in key positions in any department or agency
shall be authorized in their respective organization
structures and be funded from appropriations by this
Act.' (emphasis ours)
The foregoing provision evidently shows that the
President is authorized to effect organizational changes
including the creation of offices in the department or
agency concerned.
xxx xxx xxx
Another legal basis of E.O. No. 132 is Section 20, Book
III of E.O. No. 292 which states:
'SECTION 20. Residual Powers. — Unless Congress
provides otherwise, the President shall exercise such
 other powers and functions vested in the President
which are provided for under the laws and which are
not specifically enumerated above or which are not
delegated by the President in accordance with law.'
(emphasis ours)
This provision speaks of such other powers vested in
the President under the law. What law then gives him
the power to reorganize? It is Presidential Decree
No.1772 which amended Presidential Decree
No.1416. These decrees expressly grant the President
of the Philippines the continuing authority to
reorganize the national government, which includes the
power to group, consolidate bureaus and agencies, to
abolish offices, to transfer functions, to create and
classify functions, services and activities and to
standardize salaries and materials. The validity of
these two decrees are unquestionable. The 1987
Constitution clearly provides that "all laws, decrees,
executive orders, proclamations, letters of instructions
and other executive issuances not inconsistent with this
Constitution shall remain operative until amended,
repealed or revoked. So far, there is yet no law
amending or repealing said decrees." (Emphasis
supplied)
Now, let us take a look at the assailed executive order.
In the whereas clause of E.O. No. 191, former President Estrada anchored
his authority to deactivate EIIB on Section 77 of Republic Act 8745
(FY 1999 General Appropriations Act), a provision similar to Section 62
of R.A. 7645 quoted in Larin, thus;
"SECTION 77. Organized Changes.
— Unless otherwise provided by law or directed by the
President of the Philippines, no changes in key
positions or organizational units in any department or
agency shall be authorized in their respective
organizational structures and funded from
appropriations provided by this Act."
We adhere to the precedent or ruling in Larin that this provision recognizes
the authority of the President to effect organizational changes in the
department or agency under the executive structure. Such a ruling further
finds support in Section 78 of Republic Act No. 8760. 22 Under this law,
the heads of departments, bureaus, offices and agencies and other entities in
the Executive Branch are directed (a) to conduct a comprehensive review of
their respective mandates, missions, objectives, functions, programs,
projects, activities and systems and procedures; (b) identify activities which
are no longer essential in the delivery of public services and which may be
scaled down, phased-out or abolished; and (c) adopt measures that will
result in the streamlined organization and improved overall performance of
their respective agencies. 23 Section 78 ends up with the mandate that
the actual streamlining and productivity improvement in agency
organization and operation shall be effected pursuant to Circulars or
Orders issued for the purpose by the Office of the President. 24 The law has
spoken clearly. We are left only with the duty to sustain.
But of course, the list of legal basis authorizing the President to reorganize
any department or agency in the executive branch does not have to end here.
We must not lose sight of the very source of the power — that which
constitutes an express grant of power. Under Section 31, Book III of
Executive Order No. 292 (otherwise known as theAdministrative Code of
1987), "the President, subject to the policy in the Executive Office and in
order to achieve simplicity, economy and efficiency, shall have the
continuing authority to reorganize the administrative structure of the Office
of the President." For this purpose, he may transfer the functions of other
Departments or Agencies to the Office of the President. In Canonizado
v. Aguirre, 25 we ruled that reorganization "involves the reduction of
personnel, consolidation of offices, or abolition thereof by reason of
economy or redundancy of functions." It takes place when there is an
alteration of the existing structure of government offices or units therein,
including the lines of control, authority and responsibility between them.
The EIIB is a bureau attached to the Department of Finance. 26 It falls
under the Office of the President. Hence, it is subject to the President's
continuing authority to reorganize.
It having been duly established that the President has the authority to carry
out reorganization in any branch or agency of the executive department,
what is then left for us to resolve is whether or not the reorganization is
valid. In this jurisdiction, reorganizations have been regarded as valid
provided they are pursued in good faith. Reorganization is carried out in
'good faith' if it is for the purpose of economy or to make bureaucracy more
efficient. 27 Pertinently, Republic Act No. 6656 28 provides for the
circumstances which may be considered as evidence of bad faith in the
removal of civil service employees made as a result of reorganization, to
wit: (a) where there is a significant increase in the number of positions in
the new staffing pattern of the department or agency concerned; (b) where
an office is abolished and another performing substantially the same
functions is created; (c) where incumbents are replaced by those less
qualified in terms of status of appointment, performance and merit; (d)
where there is a classification of offices in the department or agency
concerned and the reclassified offices perform substantially the same
functions as the original offices, and (e) where the removal violates the
order of separation. 29
Petitioners claim that the deactivation of EIIB was done in bad faith
because four days after its deactivation, President Estrada created the Task
Force Aduana.
We are not convinced.
An examination of the pertinent Executive Orders 30 shows that the
deactivation of EIIB and the creation of Task Force Aduana were done in
good faith. It was not for the purpose of removing the EIIB employees, but
to achieve the ultimate purpose of E.O. No. 191, which is economy. While
Task Force Aduana was created to take the place ofEIIB, its creation does
not entail expense to the government.
Firstly, there is no employment of new personnel to man the Task
Force. E.O. No. 196 provides that the technical, administrative and special
staffs of EIIB are to be composed of people who are already in the public
service, they being employees of other existing agencies. Their tenure with
the Task Force would only be temporary, i.e., only when the agency where
they belong is called upon to assist the Task Force. Since their employment
with the Task force is only by way of detail or assignment, they retain their
employment with the existing agencies. And should the need for them cease,
they would be sent back to the agency concerned.
Secondly, the thrust of E.O. No. 196 is to have a small group of military
men under the direct control and supervision of the President as base of the
government's anti-smuggling campaign. Such a smaller base has the
necessary powers 1) to enlist the assistance of any department, bureau, or
office and to use their respective personnel, facilities and resources; and 2)
"to select and recruit personnel from within the PSG and ISAFP
for assignment to the Task Force." Obviously, the idea is to encourage the
utilization of personnel, facilities and resources of the already existing
departments, agencies, bureaus, etc., instead of maintaining an independent
office with a whole set of personnel and facilities. The EIIB had proven
itself burdensome for the government because it maintained separate offices
in every region in the Philippines.
And thirdly, it is evident from the yearly budget appropriation of the
government that the creation of the Task Force Aduana was especially
intended to lessen EIIB's expenses. Tracing from the yearly General
Appropriations Act, it appears that the allotted amount for the EIIB's
general administration, support, and operations for the year 1995,
wasP128,031,000; 31 for 1996, P182,156,000; 32 for
1998, P219,889,000; 33 and, for 1999, P238,743,000. 34 These amounts
were far above the P50,000,000 35 allocation to the Task Force Aduana for
the year 2000.
While basically, the functions of the EIIB have devolved upon the Task
Force Aduana, we find the latter to have additional new powers. The Task
Force Aduana, being composed of elements from the Presidential Security
Group (PSG) and Intelligence Service Armed Forces of the Philippines
(ISAFP), 36 has the essential power to effect searches, seizures and arrests.
The EIIB did not have this power. The Task Force Aduana has the power to
enlist the assistance of any department, bureau, office, or instrumentality of
the government, including government-owned or controlled corporations;
and to use their personnel, facilities and resources. Again, the EIIB did not
have this power. And, the Task Force Aduana has the additional authority to
conduct investigation of cases involving ill-gotten wealth. This was not
expressly granted to the EIIB.
Consequently, it cannot be said that there is a feigned reorganization. the EIIB will not be the last agency to suffer the impact. We cannot frustrate
In Blaquera v. Civil Service Commission, 37 we ruled that a reorganization valid measures which are designed to rebuild the executive department.
in good faith is one designed to trim the fat off the bureaucracy and institute
economy and greater efficiency in its operation.

Lastly, we hold that petitioners' right to security of tenure is not violated. WHEREFORE, the petition is hereby DENIED. No costs.
Nothing is better settled in our law than that the abolition of an office within
the competence of a legitimate body if done in good faith suffers from no SO ORDERED. CHDaAE
infirmity. Valid abolition of offices is neither removal nor separation of the
incumbents. 38 In the instructive words laid down by this Court in Dario
v. Mison, 39 through Justice Abraham F. Sarmiento: Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Pardo,
Buena, Ynares-Santiago and De Leon, Jr., JJ., concur.
Reorganizations in this jurisdiction have been regarded
as valid provided they are pursued in good faith. As a Quisumbing and Panganiban, JJ., concurs in the result.
general rule, a reorganization is carried out in "good
faith" if it is for the purpose of economy or to make Gonzaga-Reyes, J., is on leave.
bureaucracy more efficient. In that event, no dismissal
(in case of dismissal) or separation actually occurs
because the position itself ceases to exist. And in that
case, security of tenure would not be a Chinese wall. Be
that as it may, if the 'abolition,' which is nothing else
but a separation or removal, is done for political reasons
or purposely to defeat security of tenure, otherwise not
in good faith, no valid 'abolition' takes and whatever
'abolition' is done, is void ab initio. There is an invalid
'abolition' as where there is merely a change of
nomenclature of positions, or where claims of economy
are belied by the existence of ample funds.

Indeed, there is no such thing as an absolute right to hold office. Except

constitutional offices which provide for special immunity as regards salary
and tenure, no one can be said to have any vested right in an office or its
salary. 40

While we cast a commiserating look upon the plight of all

the EIIB employees whose lives perhaps are now torn with uncertainties,
we cannot ignore the unfortunate reality that our government is also battling
the impact of a plummeting economy. Unless the government is given the
chance to recuperate by instituting economy and efficiency in its system,
 SECOND DIVISION
[G.R. No. 106296. July 5, 1996.]
ISABELO T. CRISOSTOMO, petitioner, vs.
THE COURT OF APPEALS and the
PEOPLE OF THE PHILIPPINES, respondents. *
Puno & Associates Law Office for petitioner.
The Solicitor General for respondents.
SYLLABUS
1. ADMINISTRATIVE LAW; PUBLIC OFFICE;
ABOLITION OF OFFICE; MUST BE MADE BY MEANS OF AN
EXPRESS DECLARATION TO THAT EFFECT BY THE LAWMAKING
AUTHORITY. — P.D. No. 1341 did not abolish, but only changed, the
former Philippine College of Commerce into what is now the Polytechnic
University of the Philippines, in the same way that earlier in 1952, R.A. No.
778 had converted what was then the Philippine School of Commerce into
the Philippine College of Commerce. What took place was a change in
academic status of the educational institution, not in its corporate life.
Hence the change in its name, the expansion of its curricular offerings, and
the changes in its structure and organization. As petitioner correctly points
out, when the purpose is to abolish a department or an office or an
organization and to replace it with another one, the lawmaking authority
says so.
2. ID.; ID.; EXPIRATION OF TERM OF OFFICE; BARS A PUBLIC
OFFICER FROM INVOKING HIS CLAIM OF REINSTATEMENT. —
The reinstatement of petitioner to the positionof president of the PUP could
not be ordered by the trial court because on June 10, 1978, P.D. No.
1437 had been promulgated fixing the term of office of presidents of state
universities and colleges at six (6) years, renewable for another term of six
(6) years, and authorizing the President of the Philippines to terminate the
terms of incumbents who were not reappointed. In this case, Dr. Pablo T.
Mateo, Jr., who had been acting president of the university since April 3,
1979, was appointed president of the PUP for a term of six (6) years on
March 28, 1980, with the result that petitioner's term was cut short. In
accordance with §7 of the law, therefore, petitioner became entitled only to
retirement benefits or the payment of separation pay. Petitioner must have
recognized this fact, that is why in 1992 he asked then President Aquino to
consider him for appointment to the same position after it had become
vacant in consequence of the retirement of Dr. Prudente.
DECISION
MENDOZA, J p:
This is a petition to review the decision of the Court of Appeals dated July
15, 1992, the dispositive portion of which reads:
WHEREFORE, the present petition is partially granted.
The questioned Orders and writs directing (1)
"reinstatement" of respondent Isabelo T. Crisostomo to
the position of "President of the Polytechnic
University of the Philippines," and (2)
payment of "salaries and benefits" which said
respondent failed to receive during his suspension
insofar as such payment includes those accruing after
the abolition of the PCC and its transfer to the PUP, are
hereby set aside. Accordingly, further proceedings
consistent with this decision may be taken by
the court a quo to determine the correct amounts due
and payable to said respondent by the said university.
The background of this case is as follows:
Petitioner Isabelo Crisostomo was President of the Philippine
College of Commerce (PCC), having been appointed to that position by the
President of the Philippines on July 17, 1974.
During his incumbency as president of the PCC, two administrative cases
were filed against petitioner for illegal use of government vehicles,
misappropriation of construction materials belonging to the college,
oppression and harassment, grave misconduct, nepotism and dishonesty.
The administrative cases, which were filed with the Office of the President,
were subsequently referred to the Office of the Solicitor General for
investigation.
Charges of violations of R.A. No. 3019, §3 (e) and R.A. No.
992, §20-21 and R.A. No. 733, §14 were likewise filed against him
with the Office of Tanodbayan.
On June 14, 1976, three (3) informations for violation of Sec. 3
(e) of the Anti-Graft and Corrupt Practices Act (R.A. No. 3019, as
amended) were filed against him. The informations alleged that he
appropriated for himself a bahay kubo, which was intended for the College,
and construction materials worth P250,000.00, more or less. Petitioner was
also accused of using a driver of the College as his personal and family
driver. 1
On October 22, 1976, petitioner was preventively suspended from office
pursuant to R.A. No. 3019, §13, as amended. In his place Dr. Pablo T.
Mateo, Jr. was designated as officer-in-charge on November 10, 1976, and
then as Acting President on May 13, 1977.
On April 1, 1978, P.D. No. 1341 was issued by then President Ferdinand E.
Marcos, CONVERTING THE PHILIPPINE COLLEGE OF COMMERCE
INTO A POLYTECHNIC UNIVERSITY, DEFINING ITS OBJECTIVES,
ORGANIZATIONAL STRUCTURE AND FUNCTIONS, AND
EXPANDING ITS CURRICULAR OFFERINGS.
Mateo continued as the head of the new University. On April 3, 1979, he
was appointed Acting President and on March 28, 1980, as President for a
term of six (6)years.
On July 11, 1980, the Circuit Criminal Court of Manila rendered judgment
acquitting petitioner of the charges against him. The dispositive
portion of the decision reads:
WHEREFORE, the Court finds the accused, Isabelo
T. Crisostomo, not guilty of the violations charged in
all these three cases and hereby acquits him therefrom,
with costs de oficio. The bail bonds filed by said
accused for his provisional liberty are hereby cancelled
and released.
Pursuant to the provisions of Section 13, R.A. No.
3019, as amended, otherwise known as The Anti-Graft
and Corrupt Practices Act, and under which the accused
has been suspended by this Court in an Order dated
October 22, 1976, said accused is hereby ordered
reinstated to the position of President of the Philippine
College ofCommerce, now known as the Polytechnic
University of the Philippines, from which he has been
suspended. By virtue of said reinstatement, he is
entitled to receive the salaries and other benefits which
he failed to receive during suspension, unless in the
meantime administrative proceedings have been filed
against him.
The bail bonds filed by the accused for his provisional
liberty in these cases are hereby cancelled and released.
SO ORDERED.
The cases filed before the Tanodbayan (now the Ombudsman) were
likewise dismissed on August 8, 1991 on the ground that they had become
moot and academic. On the other hand, the administrative cases were
dismissed for failure of the complainants to prosecute them.
On February 12, 1992, petitioner filed with the Regional Trial Court a
motion for execution of the judgment, particularly the part ordering his
reinstatement to the position ofpresident of the PUP and the payment of his
salaries and other benefits during the period of suspension.
The motion was granted and a partial writ of execution was issued by the
trial court on March 6, 1992. On March 26, 1992, however, President
Corazon C. Aquino appointed Dr. Jaime Gellor as acting president of the
PUP, following the expiration of the term of office of Dr. Nemesio
Prudente, who had succeeded Dr. Mateo. Petitioner was one ofthe five
nominees considered by the President of the Philippines for the position.
On April 24, 1992, the Regional Trial Court, through respondent Judge
Teresita Dy-Liaco Flores, issued another order, reiterating her earlier order
for the reinstatement ofpetitioner to the position of PUP president. A
writ of execution, ordering the sheriff to implement the
order of reinstatement, was issued.
In his return dated April 28, 1992, the sheriff stated that he had executed the
writ by installing petitioner as President of the PUP, although Dr. Gellor did
not vacate the office as he wanted to consult with the President of the
Philippines first. This led to a contempt citation against Dr. Gellor. A
hearing was set on May 7, 1992. On May 5, 1992, petitioner also moved to
cite Department of Education, Culture and Sports Secretary Isidro Cariño in
contempt of court. Petitioner assumed the office of president of the PUP.
On May 18, 1992, therefore, the People of the Philippines filed a petition
for certiorari and prohibition (CA G.R. No. 27931), assailing the two orders
and the writs of execution issued by the trial court. It also asked for a
temporary restraining order.
On June 25, 1992, the Court of Appeals issued a temporary restraining
order, enjoining petitioner to cease and desist from acting as president of the
PUP pursuant to the reinstatement orders of the trial court, and enjoining
further proceedings in Criminal Cases Nos. VI-2329-2331.
On July 15, 1992, the Seventh Division of the Court of Appeals rendered a
decision, 2 the dispositive portion of which is set forth at the
beginning of this opinion. Said decision set aside the orders and
writ of reinstatement issued by the trial court. The payment of salaries and
benefits to petitioner accruing after the conversion of the PCC to the PUP
was disallowed. Recovery of salaries and benefits was limited to those
accruing from the time of petitioner's suspension until the conversion of the
PCC to the PUP. The case was remanded to the trial court for a
determination of the amounts due and payable to petitioner.
Hence this petition. Petitioner argues that P.D. No. 1341, which converted
the PCC into the PUP, did not abolish the PCC. He contends that if the law
had intended the PCC to lose its existence, it would have specified that the
PCC was being "abolished" rather than "converted" and that if the PUP was
intended to be a new institution, the law would have said it was being
"created." Petitioner claims that the PUP is merely a continuation of the
existence of the PCC, and, hence, he could be reinstated to his former
position as president.
In part the contention is well taken, but, as will presently be explained,
reinstatement is no longer possible because of the promulgation of P.D. No.
1437 by the President ofthe Philippines on June 10, 1978.
P.D. No. 1341 did not abolish, but only changed, the former Philippine
College of Commerce into what is now the Polytechnic University of the
Philippines, in the same way that earlier in 1952, R.A. No. 778 had
converted what was then the Philippine School of Commerce into the
Philippine College of Commerce. What took place was a change in
academic status of the educational institution, not in its corporate life.
Hence the change in its name, the expansion of its curricular offerings, and
the changes in its structure and organization.
As petitioner correctly points out, when the purpose is to abolish a
department or an office or an organization and to replace it with another
one, the lawmaking authority says so. He cites the following examples:
E.O. No. 709:
§1. There is hereby created a Ministry of Trade and
Industry, hereinafter referred to as the Ministry. The
existing Ministry of Trade established pursuant
toPresidential Decree No. 721 as amended, and the
existing Ministry established pursuant to Presidential
Decree No. 488 as amended, are abolished together
with their services, bureaus and similar agencies,
regional offices, and all other entities under their
supervision and control. . .
E.O. No. 710:
 §1. There is hereby created a Ministry of Public Works
and Highways, hereinafter referred to as the Ministry.
The existing Ministry of Public Works established
pursuant to Executive Order No. 546 as amended, and
the existing Ministry of Public Highways established
pursuant to Presidential Decree No. 458 as amended,
are abolished together with their services, bureaus and
similar agencies, regional offices, and all other entities
within their supervision and control. . . .
R.A. No. 6975:
§13. Creation and Composition. — A National Police
Commission, hereinafter referred to as the Commission,
is hereby created for the purpose of effectively
discharging the functions prescribed in the Constitution
and provided in this Act. The Commission shall be a
collegial body within the Department. It shall be
composed of a Chairman and four (4) regular
commissioners, one (1) of whom shall be designated as
Vice-Chairman by the President. The Secretary of the
Department shall be the ex-officio Chairman of the
Commission, while the Vice-Chairman shall act as the
executive officer of the Commission.
xxx xxx xxx
§90. Status of Present NAPOLCOM, PC-INP. — Upon
the effectivity of this Act, the present National Police
Commission, and the Philippine Constabulary-
Integrated National Police shall cease to exist. The
Philippine Constabulary, which is the nucleus of the
integrated Philippine Constabulary-Integrated National
Police, shall cease to be a major service of the Armed
Forces of the Philippines. The Integrated National
Police, which is the civilian component of the
Philippine Constabulary-Integrated National Police,
shall cease to be the national police force and in lieu
thereof, a new police force shall be established and
constituted pursuant to this Act.
In contrast, P.D. No. 1341, provides:
§1. The present Philippine College of Commerce is
hereby converted into a university to be known as the
"Polytechnic University of the Philippines," hereinafter
referred to in this Decree as the University.
As already noted, R.A. No. 778 earlier provided:
§1. The present Philippine School of Commerce,
located in the City of Manila, Philippines, is hereby
granted full college status and converted into the
Philippine College of Commerce, which will offer not
only its present one-year and two-year vocational
commercial curricula, the latter leading to the
titles of Associate in Business Education and/or
Associate in Commerce, but also four-year courses
leading to the degrees of Bachelor of Science in
Business in Education and Bachelor ofScience in
Commerce, and five-year courses leading to the
degrees of Master of Arts in Business Education and
Master of Arts in Commerce, respectively.
The appellate court ruled, however, that the PUP and the PCC are not "one
and the same institution" but "two different entities" and that since
petitioner Crisostomo's term was coterminous with the legal existence of the
PCC, petitioner's term expired upon the abolition of the PCC. In reaching
this conclusion, the Court of Appeals took into account the following:
a) After respondent Crisostomo's suspension, P.D. No.
1341 (entitled "CONVERTING THE PHILIPPINE
COLLEGE OF COMMERCE INTO A
POLYTECHNIC UNIVERSITY, DEFINING ITS
OBJECTIVES, ORGANIZATIONAL STRUCTURE
AND FUNCTIONS, AND EXPANDING ITS
CURRICULAR OFFERINGS") was issued on April 1,
1978. This decree explicitly provides that PUP's
objectives and purposes cover not only PCC's
offering of programs "in the field of commerce and
business administration" but also "programs in other
polytechnic areas" and "in other fields such as
agriculture, arts and trades and fisheries . . ." (Section
2). Being a university, PUP was conceived as a bigger
institution absorbing, merging and integrating the entire
PCC and other "national schools" as may be
"transferred" to this new state university.
b) The manner of selection and appointment of the
university head is substantially different from that
provided by the PCC Charter. The PUP President "shall
be appointed by the President of the Philippines upon
recommendation of the Secretary of Education and
Culture after consultation with the University
Board ofRegents" (Section 4, P.D. 1341). The
President of PCC, on the other hand, was appointed "by
the President of the Philippines upon
recommendation of the Board ofTrustees" (Section
4, R.A. 778).
c) The composition of the new university's
Board of Regents is likewise different from that of the
PCC Board of Trustees (which included the
chairman of the Senate Committee on Education and
the chairman of the House Committee on Education,
the President of the PCC Alumni Association as well as
the President of the Chamber of Commerce of the
Philippines). Whereas, among others, the NEDA
Director-General, the Secretary of Industry and the
Secretary of Labor are members ofthe PUP
Board of Regents. (Section 6, P.D. 1341).
d) The decree moreover transferred to the new
university all the properties including "equipment and
facilities":
". . . owned by the Philippine
College of Commerce and such other National
Schools as may be integrated . . . including
their obligations and appropriations . . ." (Sec. 12;
emphasis supplied). 3
But these are hardly indicia of an intent to abolish an existing institution and
to create a new one. New course offerings can be added to the
curriculum of a school without affecting its legal existence. Nor will
changes in its existing structure and organization bring about its abolition
and the creation of a new one. Only an express declaration to that effect by
the lawmaking authority will.
The Court of Appeals also cites the provision of P.D. No. 1341 as allegedly
implying the abolition of the PCC and the creation of a new one — the PUP
— in its stead:
§12. All parcels of land, buildings, equipment and
facilities owned by the Philippine
College of Commerce and such other national schools
as may be integrated by virtue of this decree, including
their obligations and appropriations thereof, shall stand
transferred to the Polytechnic University of the
Philippines, provided, however, that said national
schools shall continue to receive their corresponding
shares from the special education fund of the
municipal/provincial/city government concerned as are
now enjoyed by them in accordance with existing laws
and/or decrees.
The law does not state that the lands, buildings and equipment owned by the
PCC were being "transferred" to the PUP but only that they "stand
transferred" to it. "Stand transferred" simply means, for example, that lands
transferred to the PCC were to be understood as transferred to the PUP as
the new name of the institution.
But the reinstatement of petitioner to the position of president of the PUP
could not be ordered by the trial court because on June 10, 1978, P.D. No.
1437 had been promulgated fixing the term of office of presidents of state
universities and colleges at six (6) years, renewable for another term of six
(6) years, and authorizing the Presidentof the Philippines to terminate the
terms of incumbents who were not reappointed. P.D. No. 1437 provides:
§6. The head of the university or college shall be
known as the President of the university or college. He
shall be qualified for the position and appointed for a
term of six (6) years by the President of the Philippines
upon recommendation of the Secretary of Education
and Culture after consulting with the Board which may
be renewed for another term upon
recommendation of the Secretary of Education and
Culture after consulting the Board. In case of vacancy
by reason of death, absence or resignation, the
Secretary of Education and Culture shall have the
authority to designate an officer in charge of the college
or university pending the appointment of the President.
The powers and duties of the President of the university
or college, in addition to those specifically provided for
in this Decree shall be those usually pertaining to the
office of the president of a university or college.
§7. The incumbent president of a chartered state college
or university whose term may be terminated according
to this Decree, shall be entitled to full retirement
benefits: provided that he has served the government
for at least twenty (20) years and provided, further that
in case the number of years served is less than 20 years,
he shall be entitled to one month pay for every
year of service.
In this case, Dr. Pablo T. Mateo Jr., who had been acting president of the
university since April 3, 1979, was appointed president of PUP for a
term of six (6) years on March 28, 1980, with the result that petitioner's
term was cut short. In accordance with §7 of the law, therefore, petitioner
became entitled only to retirement benefits or the payment ofseparation pay.
Petitioner must have recognized this fact, that is why in 1992 he asked then
President Aquino to consider him for appointment to the same position after
it had become vacant in consequence of the retirement of Dr. Prudente.
WHEREFORE, the decision of the Court of Appeals is MODIFIED by
SETTING ASIDE the questioned orders of the Regional
Trial Court directing the reinstatement of the petitioner Isabelo
T. Crisostomo to the position of president of the Polytechnic
University of the Philippines and the payment to him of salaries and
benefits which he failed to receive during his suspension in so far as such
payment would include salaries accruing after March 28, 1980 when
petitioner Crisostomo's term was terminated. Further proceedings in
accordance with this decision may be taken by the trial court to determine
the amount due and payable to petitioner by the university up to March 28,
1980.
SO ORDERED.
Regalado, Romero and Torres, JJ ., concur.
Puno, J ., took no part.
Footnotes
*The original title of this case, "Hon. Teresita Dy-Liaco Flores, as
Presiding Judge, RTC, Branch 46, Manila, Elmer R. Melgas, as
Sheriff IV of Manila and Isabelo T. Crisostomo, petitioners, v.
The Court of Appeals and the People of the Philippines,
respondents," has been changed by omitting the names of the
first two petitioners who were merely nominal parties in
the Court of Appeals.
1.Judgment in CCC-VI-2329-2331, pp. 2-3.
 2.Per Justice Lorna Lombos-De la Fuente, chairman, and concurred in by
Justices Cesar D. Francisco and Cancio C. Garcia, members.

3.Rollo, p. 148, Decision, p. 4.

 FIRST DIVISION
[G.R. No. 142283. February 6, 2003.]
ROSA LIGAYA C. DOMINGO, ROMEO M.
FERNANDEZ, VICTORIA S. ESTRADA,
JULIETA C. FAJARDO, ADELAIDA B.
GAWIRAN, MARCIANO M. SERVO, VICTORIA
S. DAOANG, FELICIANO N. TOLEDO III,
JAYNELYN D. FLORES, MA. LIZA B. LLOREN,
ROMELIA A. CONTAPAY, MARIVIC B.
TOLITOL, PAZ LEVITA G. VILLANUEVA,
EDITHA C. HERNANDEZ, JOSE HERNANDEZ,
JR., VERONICA C. BELLES, AMELITA S. BUCE,
MERCELITA C. MARANAN, CRISTITUTO C.
LLOREN, HERNANDO M. EVANGELISTA, and
CARLOS BACAY, JR., petitioners, vs. HON.
RONALDO D. ZAMORA, in his capacity as the
Executive Secretary, HON. ANDREW B.
GONZALES, in his capacity as the Secretary of
Education, and HON. CARLOS D. TUASON, in his
capacity as the Chairman of the Philippine Sports
Commission, respondents.
The Law Firm of Nitorreda and Nasser for petitioners.
Solicitor General for respondents.
SYNOPSIS
Petition for certiorari seeking to nullify EO No. 81 and Memoranda Nos.
01592 and 01594 issued pursuant thereto, which transferred the sports
development programs and activities of the DECS to the Philippine Sports
Commission (PSC). Petitioners claimed that EO 81 is void for being an
undue legislation by President Estrada and the questioned memoranda
reassigned all Bureau of Physical Education and School Sports (BPESS)
personnel named in the DECS Memoranda to various offices within the
DECS. ECcDAH
The subsequent enactment of RA 9155 abolishing the BPESS and
transferring the DECS' functions relating to sports competition to the PSC
has rendered the petition moot and academic. Also, petitioners admit
that RA 9155 now explicitly provides for the protection of their right to
security of tenure.
SYLLABUS
1. POLITICAL LAW; ADMINISTRATIVE CODE OF 1987; EO 81 IS A
VALID EXERCISE OF THE PRESIDENT'S DELEGATED POWER TO
REORGANIZE THE OFFICE OF THE PRESIDENT. — Executive Order
No. 292 ("EO 292" for brevity), otherwise known as the Administrative
Code of 1987, expressly grants the President continuing authority to
reorganize the Office of the President. Under Section 31. . . Since EO 81 is
based on the President's continuing authority under Section 31 (2) and (3)
of EO 292, EO 81 is a valid exercise of the President's delegated power to
reorganize the Office of the President. The law grants the President this
power in recognition of the recurring need of every President to reorganize
his office "to achieve simplicity, economy and efficiency." The Office of
the President is the nerve center of the Executive Branch. To remain
effective and efficient, the Office of the President must be capable of being
shaped and reshaped by the President in the manner he deems fit to carry
out his directives and policies. After all, the Office of the President is the
command post of the President. This is the rationale behind the President's
continuing authority to reorganize the administrative structure of the Office
of the President. Petitioners' contention that the DECS is not part of the
Office of the President is immaterial. Under EO 292, the DECS is
indisputably a Department of the Executive Branch. Even if the DECS is
not part of the Office of the President, Section 31 (2) and (3) of EO
292 clearly authorizes the President to transfer any function or agency of
the DECS to the Office of the President. Under its charter, the PSC is
attached to the Office of the President. Therefore, the President has the
authority to transfer the "functions, programs and activities of DECS related
to sports development" to the PSC, making EO 81 a valid presidential
issuance. acTDCI
2. ID.; ID.; ID.; DISTINGUISHED FROM THE PRESIDENT'S POWER
TO REORGANIZE THE OFFICE OF THE PRESIDENT PROPER; CASE
AT BAR. — However, the President's power to reorganize the Office of the
President under Section 31 (2) and (3) of EO 292 should be distinguished
from his power to reorganize the Office of the President Proper. Under
Section 31 (1) of EO 292, the President can reorganize the Office of the
President Proper by abolishing, consolidating or merging units, or
by transferring functions from one unit to another. In contrast, under
Section 31 (2) and (3) of EO 292, the President's power to reorganize
offices outside the Office of the President Proper but still within the Office
of the President is limited to merely transferring functions or agencies from
the Office of the President to Departments or Agencies, and vice versa. This
distinction is crucial as it affects the security of tenure of employees. The
abolition of an office in good faith necessarily results in the employee's
cessation in office, but in such event there is no dismissal or separation
because the office itself ceases to exist. On the other hand, the transfer of
functions or agencies does not result in the employee's cessation in office
because his office continues to exist although in another department, agency
or office. In the instant case, the BPESS employees who were not
transferred to PSC were at first temporarily, then later permanently
reassigned to other offices of the DECS, ensuring their continued
employment. At any rate, RA 9155 now mandates that these employees
"shall be retained by the Department."
DECISION
CARPIO, J p:
The Case
This is a petition for certiorari and prohibition 1 with prayer for temporary
restraining order seeking to nullify Executive Order No. 81 and Memoranda
Nos. 01592 and 01594. 2The assailed executive order transferred the sports
development programs and activities of the Department of Education,
Culture and Sports ("DECS" for brevity) to the Philippine Sports
Commission ("PSC" for brevity). The questioned memoranda ("DECS
Memoranda" for brevity), on the other hand, reassigned all Bureau of
Physical Education and School Sports ("BPESS" for brevity) personnel
named in the DECS Memoranda to various offices within the DECS.
The Facts
On March 5, 1999, former President Joseph E. Estrada issued Executive
Order No. 81 3 ("EO 81" for brevity) entitled "Transferring the Sports
Programs and Activities of the Department of Education, Culture and Sports
to the Philippine Sports Commission and Defining the Role of DECS in
School-Based Sports."
EO 81 provided thus:
"Section 1. Transferring the Sports Program and
Activities to the PSC. All the functions, programs and
activities of DECS related to sports development as
provided for in Sec. 16 of EO 117 (s. 1987) are hereby
transferred to PSC.
Section 2. Defining the Role of DECS in School-Based
Sports. The DECS shall have jurisdiction and function
over the enhancement of Physical Education (P.E.)
curriculum and its application in whatever form inside
schools.
Section 3. The Role of PSC. As the primary agency
tasked to formulate policies and oversee the national
sports development program, the management and
implementation of all school-based sports competitions
among schools at the district, provincial, regional,
national and international levels, in coordination with
concerned public and private entities shall be
transferred to the PSC."
Pursuant to EO 81, former DECS Secretary Andrew B. Gonzales
("Secretary Gonzales" for brevity) issued Memorandum No. 01592 on
January 10, 2000. Memorandum No. 01592 temporarily reassigned, in the
exigency of the service, all remaining BPESS Staff to other divisions or
bureaus of the DECS effective March 15, 2000.
On January 21, 2000, Secretary Gonzales issued Memorandum No. 01594
reassigning the BPESS staff named in the Memorandum to various offices
within the DECS effective March 15, 2000. Petitioners were among the
BPESS personnel affected by Memorandum No. 01594. Dissatisfied with
their reassignment, petitioners filed the instant petition.
In their Petition, petitioners argue that EO 81 is void and unconstitutional
for being an undue legislation by President Estrada. Petitioners maintain
that the President's issuance of EO 81 violated the principle of separation of
powers. Petitioners also challenge the DECS Memoranda for violating their
right to security of tenure.
Petitioners seek to nullify EO 81 and the DECS Memoranda. Petitioners
pray that this Court prohibit the PSC from performing functions related to
school sports development. Petitioners further pray that, upon filing of the
petition, this Court issue a temporary restraining order against respondents
to desist from implementing EO 81.
During the pendency of the case, Republic Act No. 9155 ("RA 9155" for
brevity), otherwise known as the "Governance of Basic Education Act of
2001," was enacted on August 11, 2001. RA 9155 expressly abolished the
BPESS and transferred the functions, programs and activities of the DECS
relating to sports competition to the PSC. The pertinent provision thereof
reads:
"SEC. 9. Abolition of BPESS. — All functions,
programs and activities of the Department of Education
related to sports competition shall be transferred to the
Philippine Sports Commission (PSC). The Program for
school sports and physical fitness shall remain part of
the basic education curriculum.
The Bureau of Physical Education and School Sports
(BPESS) is hereby abolished. The personnel of the
BPESS, presently detailed with the PSC, are hereby
transferred to the PSC without loss of rank, including
the plantilla positions they occupy. All other BPESS
personnel shall be retained by the Department."
The Issue
The issue to resolve is whether EO 81 and the DECS Memoranda are valid.
The Court's Ruling
We dismiss this petition for being moot and academic.
As manifested by both petitioners 4 and respondents, 5 the subsequent
enactment of RA 9155 has rendered the issues in the present case moot and
academic. Since RA 9155abolished the BPESS and transferred the DECS'
functions relating to sports competition to the PSC, petitioners now admit
that "it is no longer plausible to raise any ultra viresassumption by the PSC
of the functions of the BPESS." 6 Moreover, since RA 9155 provides that
BPESS personnel not transferred to the PSC shall be retained by the DECS,
petitioners now accept that "the law explicitly protects and
preserves" 7 their right to security of tenure.
Although the issue is already academic, its significance constrains the Court
to point out that Executive Order No. 292 ("EO 292" for brevity), otherwise
known as theAdministrative Code of 1987, expressly grants the President
continuing authority to reorganize the Office of the President. Section 31
of EO 292 provides:
"SEC. 31. Continuing Authority of the President to
Reorganize his Office. — The President, subject to the
policy in the Executive Office and in order to achieve
simplicity, economy and efficiency, shall have
continuing authority to reorganize the administrative
structure of the Office of the President. For this
purpose, he may take any of the following actions:
(1) Restructure the internal organization of the Office of
the President Proper, including the immediate Offices,
the Presidential Special Assistants/Advisers System and
the Common Support System, by abolishing,
consolidating or merging units thereof or transferring
functions from one unit to another;
(2) Transfer any function under the Office of the
President to any other Department or Agency as well
 as transfer functions agencies to the Office of the
President from other Departments or Agencies;" and
(3) Transfer any agency under the Office of the
President to any other department or agency as well
as transfer agencies to the Office of the President
from other Departments or Agencies;"(Emphasis
supplied.)
Since EO 81 is based on the President's continuing authority under Section
31 (2) and (3) of EO 292, 8 EO 81 is a valid exercise of the President's
delegated power to reorganize the Office of the President. The law grants
the President this power in recognition of the recurring need of every
President to reorganize his office "to achieve simplicity, economy and
efficiency." The Office of the President is the nerve center of the Executive
Branch. To remain effective and efficient, the Office of the President must
be capable of being shaped and reshaped by the President in the manner he
deems fit to carry out his directives and policies. After all, the Office of the
President is the command post of the President. This is the rationale behind
the President's continuing authority to reorganize the administrative
structure of the Office of the President.
Petitioners' contention that the DECS is not part of the Office of the
President is immaterial. Under EO 292, the DECS is indisputably a
Department of the Executive Branch. Even if the DECS is not part of the
Office of the President, Section 31 (2) and (3) of EO 292 clearly authorizes
the President to transfer any function or agency of the DECS to the Office
of the President. Under its charter, the PSC is attached to the Office of the
President. 9 Therefore, the President has the authority to transfer the
"functions, programs and activities of DECS related to sports
development" 10 to the PSC, making EO 81 a valid presidential issuance.
However, the President's power to reorganize the Office of the President
under Section 31 (2) and (3) of EO 292 should be distinguished from his
power to reorganize the Office of the President Proper. Under Section 31
(1) of EO 292, the President can reorganize the Office of the
President Proper by abolishing, consolidating or mergingunits, or
by transferring functions from one unit to another. In contrast, under
Section 31 (2) and (3) of EO 292, the President's power to reorganize
offices outside the Office of the President Proper but still within the Office
of the President is limited to merely transferring functions or agencies from
the Office of the President to Departments or Agencies, and vice versa.
This distinction is crucial as it affects the security of tenure of employees.
The abolition of an office in good faith necessarily results in the employee's
cessation in office, but in such event there is no dismissal or separation
because the office itself ceases to exist. 11 On the other hand, the transfer of
functions or agencies does not result in the employee's cessation in office
because his office continues to exist although in another department, agency
or office. In the instant case, the BPESS employees who were not
transferred to PSC were at first temporarily, then later permanently
reassigned to other offices of the DECS, ensuring their continued
employment. At any rate, RA 9155 now mandates that these employees
"shall be retained by the Department." SaIHDA
WHEREFORE, the instant petition is DISMISSED. No pronouncement as
to costs.
SO ORDERED.
Davide, Jr., C.J., Vitug and Azcuna, JJ., concur.
Ynares-Santiago, J., took no part.
Footnotes
1.Under Rule 65 of the Rules of Court.
2.Issued by then Department of Education Secretary Andrew B.
Gonzales.
3.Co-signed by former Executive Secretary Ronaldo D. Zamora.
4.Rollo, p. 106, Petitioners' Reply to Comments, p. 12.
5.Ibid., p. 137, Memorandum for Respondents, p. 7.
6.Supra, see note 4.

7.Supra, see note 4.

8.The preamble of EO 81 provides:

"xxx xxx xxx

WHEREAS, paragraph 2, Section 31, Chapter 10, Title III, Book III of
the Administrative Code of 1987 grants the President the
continuing authority to reorganize the Office of the President by,
among others, transferring any function, to include certain
programs, from other Departments and/or Agencies to the Office
of the President."

9.Section 4 of RA 6847 provides:

"Status of the Commission. — The Commission shall have the same

status as that of a governmental regulatory national agency
attached to the Office of the President with the Chairman thereof
being of the same level as a department undersecretary and the
Commissioners that of department assistant secretaries."

10.Section 1, EO 81.

11.Dario v. Mison, 176 SCRA 84 (1989).\