G.R. No.
L-45081             July 15, 1936
JOSE A. ANGARA, petitioner,
vs.
THE ELECTORAL COMMISSION, PEDRO YNSUA, MIGUEL
CASTILLO, and DIONISIO C. MAYOR, respondents.
Godofredo Reyes for petitioner.
Office of the Solicitor General Hilado for respondent Electoral
Commission.
Pedro Ynsua in his own behalf.
No appearance for other respondents.
LAUREL, J.:
This is an original action instituted in this court by the petitioner, Jose A.
Angara, for the issuance of a writ of prohibition to restrain and prohibit
the Electoral Commission, one of the respondents, from taking further
cognizance of the protest filed by Pedro Ynsua, another respondent,
against the election of said petitioner as member of the National
Assembly for the first assembly district of the Province of Tayabas.
The facts of this case as they appear in the petition and as admitted by
the respondents are as follows:
(1) That in the elections of September 17, 1935, the petitioner,
Jose A. Angara, and the respondents, Pedro Ynsua, Miguel
Castillo and Dionisio Mayor, were candidates voted for the
position of member of the National Assembly for the first
district of the Province of Tayabas;
(2) That on October 7, 1935, the provincial board of
canvassers, proclaimed the petitioner as member-elect of the
National Assembly for the said district, for having received the
most number of votes;
(3) That on November 15, 1935, the petitioner took his oath of
office;
(4) That on December 3, 1935, the National Assembly in
session assembled, passed the following resolution:
[No. 8]
RESOLUCION CONFIRMANDO LAS
ACTAS DE AQUELLOS DIPUTADOS
CONTRA QUIENES NO SE HA
PRESENTADO PROTESTA.
Se resuelve: Que las actas de eleccion de
los Diputados contra quienes no se
hubiere presentado debidamente una
protesta antes de la adopcion de la
presente resolucion sean, como por la
presente, son aprobadas y confirmadas.
Adoptada, 3 de diciembre, 1935.
(5) That on December 8, 1935, the herein respondent Pedro
Ynsua filed before the Electoral Commission a "Motion of
Protest" against the election of the herein petitioner, Jose A.
Angara, being the only protest filed after the passage of
Resolutions No. 8 aforequoted, and praying, among other-
things, that said respondent be declared elected member of
the National Assembly for the first district of Tayabas, or that
the election of said position be nullified;
(6) That on December 9, 1935, the Electoral Commission
adopted a resolution, paragraph 6 of which provides:
6. La Comision no considerara ninguna protesta que
no se haya presentado en o antes de este dia.
(7) That on December 20, 1935, the herein petitioner, Jose A.
Angara, one of the respondents in the aforesaid protest, filed
before the Electoral Commission a "Motion to Dismiss the
Protest", alleging (a) that Resolution No. 8 of Dismiss the
Protest", alleging (a) that Resolution No. 8 of the National
Assembly was adopted in the legitimate exercise of its
constitutional prerogative to prescribe the period during which
protests against the election of its members should be
presented; (b) that the aforesaid resolution has for its object,
and is the accepted formula for, the limitation of said period;
and (c) that the protest in question was filed out of the
prescribed period;
(8) That on December 27, 1935, the herein respondent, Pedro
Ynsua, filed an "Answer to the Motion of Dismissal" alleging
that there is no legal or constitutional provision barring the
presentation of a protest against the election of a member of
the National Assembly after confirmation;
(9) That on December 31, 1935, the herein petitioner, Jose A.
Angara, filed a "Reply" to the aforesaid "Answer to the Motion
of Dismissal";
(10) That the case being submitted for decision, the Electoral
Commission promulgated a resolution on January 23, 1936,
denying herein petitioner's "Motion to Dismiss the Protest."
The application of the petitioner sets forth the following grounds for the
issuance of the writ prayed for:
(a) That the Constitution confers exclusive jurisdiction upon
the electoral Commission solely as regards the merits of
contested elections to the National Assembly;
(b) That the Constitution excludes from said jurisdiction the
power to regulate the proceedings of said election contests,
which power has been reserved to the Legislative Department
of the Government or the National Assembly;
(c) That like the Supreme Court and other courts created in
pursuance of the Constitution, whose exclusive jurisdiction
relates solely to deciding the merits of controversies
submitted to them for decision and to matters involving their
internal organization, the Electoral Commission can regulate
its proceedings only if the National Assembly has not availed
of its primary power to so regulate such proceedings;
(d) That Resolution No. 8 of the National Assembly is,
therefore, valid and should be respected and obeyed;
(e) That under paragraph 13 of section 1 of the ordinance
appended to the Constitution and paragraph 6 of article 7 of
the Tydings-McDuffie Law (No. 127 of the 73rd Congress of
the United States) as well as under section 1 and 3 (should be
sections 1 and 2) of article VIII of the Constitution, this
Supreme Court has jurisdiction to pass upon the fundamental
question herein raised because it involves an interpretation of
the Constitution of the Philippines.
On February 25, 1936, the Solicitor-General appeared and filed an
answer in behalf of the respondent Electoral Commission interposing
the following special defenses:
(a) That the Electoral Commission has been created by the
Constitution as an instrumentality of the Legislative
Department invested with the jurisdiction to decide "all
contests relating to the election, returns, and qualifications of
the members of the National Assembly"; that in adopting its
resolution of December 9, 1935, fixing this date as the last
day for the presentation of protests against the election of any
member of the National Assembly, it acted within its
jurisdiction and in the legitimate exercise of the implied
powers granted it by the Constitution to adopt the rules and
regulations essential to carry out the power and functions
conferred upon the same by the fundamental law; that in
adopting its resolution of January 23, 1936, overruling the
motion of the petitioner to dismiss the election protest in
question, and declaring itself with jurisdiction to take
cognizance of said protest, it acted in the legitimate exercise
of its quasi-judicial functions a an instrumentality of the
Legislative Department of the Commonwealth Government,
and hence said act is beyond the judicial cognizance or
control of the Supreme Court;
(b) That the resolution of the National Assembly of December
3, 1935, confirming the election of the members of the
National Assembly against whom no protest had thus far been
filed, could not and did not deprive the electoral Commission
of its jurisdiction to take cognizance of election protests filed
within the time that might be set by its own rules:
(c) That the Electoral Commission is a body invested with
quasi-judicial functions, created by the Constitution as an
instrumentality of the Legislative Department, and is not an
"inferior tribunal, or corporation, or board, or person" within
the purview of section 226 and 516 of the Code of Civil
Procedure, against which prohibition would lie.
The respondent Pedro Ynsua, in his turn, appeared and filed an answer
in his own behalf on March 2, 1936, setting forth the following as his
special defense:
(a) That at the time of the approval of the rules of the Electoral
Commission on December 9, 1935, there was no existing law
fixing the period within which protests against the election of
members of the National Assembly should be filed; that in
fixing December 9, 1935, as the last day for the filing of
protests against the election of members of the National
Assembly, the Electoral Commission was exercising a power
impliedly conferred upon it by the Constitution, by reason of
its quasi-judicial attributes;
(b) That said respondent presented his motion of protest
before the Electoral Commission on December 9, 1935, the
last day fixed by paragraph 6 of the rules of the said Electoral
Commission;
(c) That therefore the Electoral Commission acquired
jurisdiction over the protest filed by said respondent and over
the parties thereto, and the resolution of the Electoral
Commission of January 23, 1936, denying petitioner's motion
to dismiss said protest was an act within the jurisdiction of the
said commission, and is not reviewable by means of a writ of
prohibition;
(d) That neither the law nor the Constitution requires
confirmation by the National Assembly of the election of its
 members, and that such confirmation does not operate to limit
the period within which protests should be filed as to deprive
the Electoral Commission of jurisdiction over protest filed
subsequent thereto;
(e) That the Electoral Commission is an independent entity
created by the Constitution, endowed with quasi-judicial
functions, whose decision are final and unappealable;
( f ) That the electoral Commission, as a constitutional
creation, is not an inferior tribunal, corporation, board or
person, within the terms of sections 226 and 516 of the Code
of Civil Procedure; and that neither under the provisions of
sections 1 and 2 of article II (should be article VIII) of the
Constitution and paragraph 13 of section 1 of the Ordinance
appended thereto could it be subject in the exercise of its
quasi-judicial functions to a writ of prohibition from the
Supreme Court;
(g) That paragraph 6 of article 7 of the Tydings-McDuffie Law
(No. 127 of the 73rd Congress of the united States) has no
application to the case at bar.
The case was argued before us on March 13, 1936. Before it was
submitted for decision, the petitioner prayed for the issuance of a
preliminary writ of injunction against the respondent Electoral
Commission which petition was denied "without passing upon the
merits of the case" by resolution of this court of March 21, 1936.
There was no appearance for the other respondents.
The issues to be decided in the case at bar may be reduced to the
following two principal propositions:
1. Has the Supreme Court jurisdiction over the Electoral
Commission and the subject matter of the controversy upon
the foregoing related facts, and in the affirmative,
2. Has the said Electoral Commission acted without or in
excess of its jurisdiction in assuming to the cognizance of the
protest filed the election of the herein petitioner
notwithstanding the previous confirmation of such election by
resolution of the National Assembly?
We could perhaps dispose of this case by passing directly upon the
merits of the controversy. However, the question of jurisdiction having
been presented, we do not feel justified in evading the issue. Being a
case primæ impressionis, it would hardly be consistent with our sense
of duty to overlook the broader aspect of the question and leave it
undecided. Neither would we be doing justice to the industry and
vehemence of counsel were we not to pass upon the question of
jurisdiction squarely presented to our consideration.
The separation of powers is a fundamental principle in our system of
government. It obtains not through express provision but by actual
division in our Constitution. Each department of the government has
exclusive cognizance of matters within its jurisdiction, and is supreme
within its own sphere. But it does not follow from the fact that the three
powers are to be kept separate and distinct that the Constitution
intended them to be absolutely unrestrained and independent of each
other. The Constitution has provided for an elaborate system of checks
and balances to secure coordination in the workings of the various
departments of the government. For example, the Chief Executive
under our Constitution is so far made a check on the legislative power
that this assent is required in the enactment of laws. This, however, is
subject to the further check that a bill may become a law
notwithstanding the refusal of the President to approve it, by a vote of
two-thirds or three-fourths, as the case may be, of the National
Assembly. The President has also the right to convene the Assembly in
special session whenever he chooses. On the other hand, the National
Assembly operates as a check on the Executive in the sense that its
consent through its Commission on Appointments is necessary in the
appointments of certain officers; and the concurrence of a majority of all
its members is essential to the conclusion of treaties. Furthermore, in
its power to determine what courts other than the Supreme Court shall
be established, to define their jurisdiction and to appropriate funds for
their support, the National Assembly controls the judicial department to
a certain extent. The Assembly also exercises the judicial power of
trying impeachments. And the judiciary in turn, with the Supreme Court
as the final arbiter, effectively checks the other departments in the
exercise of its power to determine the law, and hence to declare
executive and legislative acts void if violative of the Constitution.
But in the main, the Constitution has blocked out with deft strokes and
in bold lines, allotment of power to the executive, the legislative and the
judicial departments of the government. The overlapping and interlacing
of functions and duties between the several departments, however,
sometimes makes it hard to say just where the one leaves off and the
other begins. In times of social disquietude or political excitement, the
great landmarks of the Constitution are apt to be forgotten or marred, if
not entirely obliterated. In cases of conflict, the judicial department is
the only constitutional organ which can be called upon to determine the
proper allocation of powers between the several departments and
among the integral or constituent units thereof.
As any human production, our Constitution is of course lacking
perfection and perfectibility, but as much as it was within the power of
our people, acting through their delegates to so provide, that instrument
which is the expression of their sovereignty however limited, has
established a republican government intended to operate and function
as a harmonious whole, under a system of checks and balances, and
subject to specific limitations and restrictions provided in the said
instrument. The Constitution sets forth in no uncertain language the
restrictions and limitations upon governmental powers and agencies. If
these restrictions and limitations are transcended it would be
inconceivable if the Constitution had not provided for a mechanism by
which to direct the course of government along constitutional channels,
for then the distribution of powers would be mere verbiage, the bill of
rights mere expressions of sentiment, and the principles of good
government mere political apothegms. Certainly, the limitation and
restrictions embodied in our Constitution are real as they should be in
any living constitution. In the United States where no express
constitutional grant is found in their constitution, the possession of this
moderating power of the courts, not to speak of its historical origin and
development there, has been set at rest by popular acquiescence for a
period of more than one and a half centuries. In our case, this
moderating power is granted, if not expressly, by clear implication from
section 2 of article VIII of our constitution.
The Constitution is a definition of the powers of government. Who is to
determine the nature, scope and extent of such powers? The
Constitution itself has provided for the instrumentality of the judiciary as
the rational way. And when the judiciary mediates to allocate
constitutional boundaries, it does not assert any superiority over the
other departments; it does not in reality nullify or invalidate an act of the
legislature, but only asserts the solemn and sacred obligation assigned
to it by the Constitution to determine conflicting claims of authority
under the Constitution and to establish for the parties in an actual
controversy the rights which that instrument secures and guarantees to
them. This is in truth all that is involved in what is termed "judicial
supremacy" which properly is the power of judicial review under the
Constitution. Even then, this power of judicial review is limited to actual
cases and controversies to be exercised after full opportunity of
argument by the parties, and limited further to the constitutional
question raised or the very lis mota presented. Any attempt at
abstraction could only lead to dialectics and barren legal questions and
to sterile conclusions unrelated to actualities. Narrowed as its function
is in this manner, the judiciary does not pass upon questions of
wisdom, justice or expediency of legislation. More than that, courts
accord the presumption of constitutionality to legislative enactments,
not only because the legislature is presumed to abide by the
Constitution but also because the judiciary in the determination of
actual cases and controversies must reflect the wisdom and justice of
the people as expressed through their representatives in the executive
and legislative departments of the governments of the government.
But much as we might postulate on the internal checks of power
provided in our Constitution, it ought not the less to be remembered
that, in the language of James Madison, the system itself is not "the
chief palladium of constitutional liberty . . . the people who are authors
of this blessing must also be its guardians . . . their eyes must be ever
ready to mark, their voice to pronounce . . . aggression on the authority
of their constitution." In the Last and ultimate analysis, then, must the
success of our government in the unfolding years to come be tested in
the crucible of Filipino minds and hearts than in consultation rooms and
court chambers.
In the case at bar, the national Assembly has by resolution (No. 8) of
December 3, 1935, confirmed the election of the herein petitioner to the
said body. On the other hand, the Electoral Commission has by
resolution adopted on December 9, 1935, fixed said date as the last
day for the filing of protests against the election, returns and
qualifications of members of the National Assembly, notwithstanding
the previous confirmation made by the National Assembly as aforesaid.
If, as contended by the petitioner, the resolution of the National
Assembly has the effect of cutting off the power of the Electoral
Commission to entertain protests against the election, returns and
qualifications of members of the National Assembly, submitted after
December 3, 1935, then the resolution of the Electoral Commission of
December 9, 1935, is mere surplusage and had no effect. But, if, as
contended by the respondents, the Electoral Commission has the sole
power of regulating its proceedings to the exclusion of the National
Assembly, then the resolution of December 9, 1935, by which the
Electoral Commission fixed said date as the last day for filing protests
against the election, returns and qualifications of members of the
National Assembly, should be upheld.
Here is then presented an actual controversy involving as it does a
conflict of a grave constitutional nature between the National Assembly
on the one hand, and the Electoral Commission on the other. From the
very nature of the republican government established in our country in
the light of American experience and of our own, upon the judicial
department is thrown the solemn and inescapable obligation of
interpreting the Constitution and defining constitutional boundaries. The
Electoral Commission, as we shall have occasion to refer hereafter, is a
constitutional organ, created for a specific purpose, namely to
determine all contests relating to the election, returns and qualifications
of the members of the National Assembly. Although the Electoral
Commission may not be interfered with, when and while acting within
the limits of its authority, it does not follow that it is beyond the reach of
the constitutional mechanism adopted by the people and that it is not
subject to constitutional restrictions. The Electoral Commission is not a
separate department of the government, and even if it were, conflicting
claims of authority under the fundamental law between department
powers and agencies of the government are necessarily determined by
the judiciary in justifiable and appropriate cases. Discarding the English
type and other European types of constitutional government, the
framers of our constitution adopted the American type where the written
constitution is interpreted and given effect by the judicial department. In
some countries which have declined to follow the American example,
provisions have been inserted in their constitutions prohibiting the
courts from exercising the power to interpret the fundamental law. This
is taken as a recognition of what otherwise would be the rule that in the
absence of direct prohibition courts are bound to assume what is
logically their function. For instance, the Constitution of Poland of 1921,
expressly provides that courts shall have no power to examine the
validity of statutes (art. 81, chap. IV). The former Austrian Constitution
contained a similar declaration. In countries whose constitutions are
silent in this respect, courts have assumed this power. This is true in
Norway, Greece, Australia and South Africa. Whereas, in
Czechoslovakia (arts. 2 and 3, Preliminary Law to constitutional Charter
of the Czechoslovak Republic, February 29, 1920) and Spain (arts.
121-123, Title IX, Constitutional of the Republic of 1931) especial
constitutional courts are established to pass upon the validity of
ordinary laws. In our case, the nature of the present controversy shows
the necessity of a final constitutional arbiter to determine the conflict of
authority between two agencies created by the Constitution. Were we
to decline to take cognizance of the controversy, who will determine the
conflict? And if the conflict were left undecided and undetermined,
would not a void be thus created in our constitutional system which may
be in the long run prove destructive of the entire framework? To ask
these questions is to answer them. Natura vacuum abhorret, so must
we avoid exhaustion in our constitutional system. Upon principle,
reason and authority, we are clearly of the opinion that upon the
admitted facts of the present case, this court has jurisdiction over the
Electoral Commission and the subject mater of the present controversy
for the purpose of determining the character, scope and extent of the
constitutional grant to the Electoral Commission as "the sole judge of all
contests relating to the election, returns and qualifications of the
members of the National Assembly."
Having disposed of the question of jurisdiction, we shall now proceed to
pass upon the second proposition and determine whether the Electoral
Commission has acted without or in excess of its jurisdiction in adopting
its resolution of December 9, 1935, and in assuming to take cognizance
of the protest filed against the election of the herein petitioner
notwithstanding the previous confirmation thereof by the National
Assembly on December 3, 1935. As able counsel for the petitioner has
pointed out, the issue hinges on the interpretation of section 4 of Article
VI of the Constitution which provides:
"SEC. 4. There shall be an Electoral Commission composed of three
Justice of the Supreme Court designated by the Chief Justice, and of
six Members chosen by the National Assembly, three of whom shall be
nominated by the party having the largest number of votes, and three
by the party having the second largest number of votes therein. The
senior Justice in the Commission shall be its Chairman. The Electoral
Commission shall be the sole judge of all contests relating to the
election, returns and qualifications of the members of the National
Assembly." It is imperative, therefore, that we delve into the origin and
history of this constitutional provision and inquire into the intention of its
framers and the people who adopted it so that we may properly
appreciate its full meaning, import and significance.
The original provision regarding this subject in the Act of Congress of
July 1, 1902 (sec. 7, par. 5) laying down the rule that "the assembly
shall be the judge of the elections, returns, and qualifications of its
members", was taken from clause 1 of section 5, Article I of the
Constitution of the United States providing that "Each House shall be
the Judge of the Elections, Returns, and Qualifications of its own
Members, . . . ." The Act of Congress of August 29, 1916 (sec. 18, par.
1) modified this provision by the insertion of the word "sole" as follows:
"That the Senate and House of Representatives, respectively, shall be
the sole judges of the elections, returns, and qualifications of their
elective members . . ." apparently in order to emphasize the exclusive
the Legislative over the particular case s therein specified. This court
has had occasion to characterize this grant of power to the Philippine
Senate and House of Representatives, respectively, as "full, clear and
complete" (Veloso vs. Boards of Canvassers of Leyte and Samar
[1919], 39 Phil., 886, 888.)
The first step towards the creation of an independent tribunal for the
purpose of deciding contested elections to the legislature was taken by
the sub-committee of five appointed by the Committee on Constitutional
Guarantees of the Constitutional Convention, which sub-committee
submitted a report on August 30, 1934, recommending the creation of a
Tribunal of Constitutional Security empowered to hear legislature but
also against the election of executive officers for whose election the
vote of the whole nation is required, as well as to initiate impeachment
proceedings against specified executive and judicial officer. For the
purpose of hearing legislative protests, the tribunal was to be
composed of three justices designated by the Supreme Court and six
members of the house of the legislature to which the contest
corresponds, three members to be designed by the majority party and
three by the minority, to be presided over by the Senior Justice unless
the Chief Justice is also a member in which case the latter shall
preside. The foregoing proposal was submitted by the Committee on
Constitutional Guarantees to the Convention on September 15, 1934,
with slight modifications consisting in the reduction of the legislative
representation to four members, that is, two senators to be designated
one each from the two major parties in the Senate and two
representatives to be designated one each from the two major parties
in the House of Representatives, and in awarding representation to the
executive department in the persons of two representatives to be
designated by the President.
Meanwhile, the Committee on Legislative Power was also preparing its
report. As submitted to the Convention on September 24, 1934
subsection 5, section 5, of the proposed Article on the Legislative
Department, reads as follows:
The elections, returns and qualifications of the members of
either house and all cases contesting the election of any of
their members shall be judged by an Electoral Commission,
constituted, as to each House, by three members elected by
the members of the party having the largest number of votes
therein, three elected by the members of the party having the
second largest number of votes, and as to its Chairman, one
Justice of the Supreme Court designated by the Chief Justice.
The idea of creating a Tribunal of Constitutional Security with
comprehensive jurisdiction as proposed by the Committee on
Constitutional Guarantees which was probably inspired by the Spanish
plan (art. 121, Constitution of the Spanish Republic of 1931), was soon
abandoned in favor of the proposition of the Committee on Legislative
Power to create a similar body with reduced powers and with specific
and limited jurisdiction, to be designated as a Electoral Commission.
The Sponsorship Committee modified the proposal of the Committee
on Legislative Power with respect to the composition of the Electoral
Commission and made further changes in phraseology to suit the
project of adopting a unicameral instead of a bicameral legislature. The
draft as finally submitted to the Convention on October 26, 1934, reads
as follows:
(6) The elections, returns and qualifications of the Members of
the National Assembly and all cases contesting the election of
any of its Members shall be judged by an Electoral
Commission, composed of three members elected by the
party having the largest number of votes in the National
Assembly, three elected by the members of the party having
the second largest number of votes, and three justices of the
Supreme Court designated by the Chief Justice, the
Commission to be presided over by one of said justices.
During the discussion of the amendment introduced by Delegates
Labrador, Abordo, and others, proposing to strike out the whole
subsection of the foregoing draft and inserting in lieu thereof the
following: "The National Assembly shall be the soled and exclusive
judge of the elections, returns, and qualifications of the Members", the
following illuminating remarks were made on the floor of the Convention
in its session of December 4, 1934, as to the scope of the said draft:
xxx     xxx     xxx
Mr. VENTURA. Mr. President, we have a doubt here as to the
scope of the meaning of the first four lines, paragraph 6, page
11 of the draft, reading: "The elections, returns and
qualifications of the Members of the National Assembly and
all cases contesting the election of any of its Members shall
be judged by an Electoral Commission, . . ." I should like to
ask from the gentleman from Capiz whether the election and
qualification of the member whose elections is not contested
shall also be judged by the Electoral Commission.
Mr. ROXAS. If there is no question about the election of the
members, there is nothing to be judged; that is why the word
"judge" is used to indicate a controversy. If there is no
question about the election of a member, there is nothing to
be submitted to the Electoral Commission and there is nothing
to be determined.
Mr. VENTURA. But does that carry the idea also that the
Electoral Commission shall confirm also the election of those
whose election is not contested?
Mr. ROXAS. There is no need of confirmation. As the
gentleman knows, the action of the House of Representatives
confirming the election of its members is just a matter of the
rules of the assembly. It is not constitutional. It is not
 necessary. After a man files his credentials that he has been
elected, that is sufficient, unless his election is contested.
Mr. VENTURA. But I do not believe that that is sufficient, as
we have observed that for purposes of the auditor, in the
matter of election of a member to a legislative body, because
he will not authorize his pay.
Mr. ROXAS. Well, what is the case with regards to the
municipal president who is elected? What happens with
regards to the councilors of a municipality? Does anybody
confirm their election? The municipal council does this: it
makes a canvass and proclaims — in this case the municipal
council proclaims who has been elected, and it ends there,
unless there is a contest. It is the same case; there is no need
on the part of the Electoral Commission unless there is a
contest. The first clause refers to the case referred to by the
gentleman from Cavite where one person tries to be elected
in place of another who was declared elected. From example,
in a case when the residence of the man who has been
elected is in question, or in case the citizenship of the man
who has been elected is in question.
However, if the assembly desires to annul the power of the
commission, it may do so by certain maneuvers upon its first
meeting when the returns are submitted to the assembly. The
purpose is to give to the Electoral Commission all the powers
exercised by the assembly referring to the elections, returns
and qualifications of the members. When there is no contest,
there is nothing to be judged.
Mr. VENTURA. Then it should be eliminated.
Mr. ROXAS. But that is a different matter, I think Mr.
Delegate.
Mr. CINCO. Mr. President, I have a similar question as that
propounded by the gentleman from Ilocos Norte when I arose
a while ago. However I want to ask more questions from the
delegate from Capiz. This paragraph 6 on page 11 of the draft
cites cases contesting the election as separate from the first
part of the sections which refers to elections, returns and
qualifications.
Mr. ROXAS. That is merely for the sake of clarity. In fact the
cases of contested elections are already included in the
phrase "the elections, returns and qualifications." This phrase
"and contested elections" was inserted merely for the sake of
clarity.
Mr. CINCO. Under this paragraph, may not the Electoral
Commission, at its own instance, refuse to confirm the
elections of the members."
Mr. ROXAS. I do not think so, unless there is a protest.
Mr. LABRADOR. Mr. President, will the gentleman yield?
THE PRESIDENT. The gentleman may yield, if he so desires.
Mr. ROXAS. Willingly.
Mr. LABRADOR. Does not the gentleman from Capiz believe
that unless this power is granted to the assembly, the
assembly on its own motion does not have the right to contest
the election and qualification of its members?
Mr. ROXAS. I have no doubt but that the gentleman is right. If
this draft is retained as it is, even if two-thirds of the assembly
believe that a member has not the qualifications provided by
law, they cannot remove him for that reason.
Mr. LABRADOR. So that the right to remove shall only be
retained by the Electoral Commission.
Mr. ROXAS. By the assembly for misconduct.
Mr. LABRADOR. I mean with respect to the qualifications of
the members.
Mr. ROXAS. Yes, by the Electoral Commission.
Mr. LABRADOR. So that under this draft, no member of the
assembly has the right to question the eligibility of its
members?
Mr. ROXAS. Before a member can question the eligibility, he
must go to the Electoral Commission and make the question
before the Electoral Commission.
Mr. LABRADOR. So that the Electoral Commission shall
decide whether the election is contested or not contested.
Mr. ROXAS. Yes, sir: that is the purpose.
Mr. PELAYO. Mr. President, I would like to be informed if the
Electoral Commission has power and authority to pass upon
the qualifications of the members of the National Assembly
even though that question has not been raised.
Mr. ROXAS. I have just said that they have no power,
because they can only judge.
In the same session, the first clause of the aforesaid draft reading "The
election, returns and qualifications of the members of the National
Assembly and" was eliminated by the Sponsorship Committee in
response to an amendment introduced by Delegates Francisco,
Ventura, Vinzons, Rafols, Lim, Mumar and others. In explaining the
difference between the original draft and the draft as amended,
Delegate Roxas speaking for the Sponsorship Committee said:
xxx     xxx     xxx
Sr. ROXAS. La diferencia, señor Presidente, consiste
solamente en obviar la objecion apuntada por varios
Delegados al efecto de que la primera clausula del draft que
dice: "The elections, returns and qualifications of the
members of the National Assembly" parece que da a la
Comision Electoral la facultad de determinar tambien la
eleccion de los miembros que no ha sido protestados y para
obviar esa dificultad, creemos que la enmienda tien razon en
ese sentido, si enmendamos el draft, de tal modo que se lea
como sigue: "All cases contesting the election", de modo que
los jueces de la Comision Electoral se limitaran solamente a
los casos en que haya habido protesta contra las actas."
Before the amendment of Delegate Labrador was voted upon
the following interpellation also took place:
El Sr. CONEJERO. Antes de votarse la enmienda, quisiera
El Sr. PRESIDENTE. ¿Que dice el Comite?
El Sr. ROXAS. Con mucho gusto.
El Sr. CONEJERO. Tal como esta el draft, dando tres
miembros a la mayoria, y otros tres a la minoria y tres a la
Corte Suprema, ¿no cree Su Señoria que esto equivale
practicamente a dejar el asunto a los miembros del Tribunal
Supremo?
El Sr. ROXAS. Si y no. Creemos que si el tribunal o la
Commission esta constituido en esa forma, tanto los
miembros de la mayoria como los de la minoria asi como los
miembros de la Corte Suprema consideraran la cuestion
sobre la base de sus meritos, sabiendo que el partidismo no
es suficiente para dar el triunfo.
El Sr. CONEJERO. ¿Cree Su Señoria que en un caso como
ese, podriamos hacer que tanto los de la mayoria como los
de la minoria prescindieran del partidismo?
El Sr. ROXAS. Creo que si, porque el partidismo no les daria
el triunfo.
xxx     xxx     xxx
The amendment introduced by Delegates Labrador, Abordo and others
seeking to restore the power to decide contests relating to the election,
returns and qualifications of members of the National Assembly to the
National Assembly itself, was defeated by a vote of ninety-eight (98)
against fifty-six (56).
In the same session of December 4, 1934, Delegate Cruz (C.) sought
to amend the draft by reducing the representation of the minority party
and the Supreme Court in the Electoral Commission to two members
each, so as to accord more representation to the majority party. The
Convention rejected this amendment by a vote of seventy-six (76)
against forty-six (46), thus maintaining the non-partisan character of the
commission.
As approved on January 31, 1935, the draft was made to read as
follows:
(6) All cases contesting the elections, returns and
qualifications of the Members of the National Assembly shall
be judged by an Electoral Commission, composed of three
members elected by the party having the largest number of
votes in the National Assembly, three elected by the members
of the party having the second largest number of votes, and
three justices of the Supreme Court designated by the Chief
Justice, the Commission to be presided over by one of said
justices.
The Style Committee to which the draft was submitted revised it as
follows:
SEC. 4. There shall be an Electoral Commission composed of
three Justices of the Supreme Court designated by the Chief
Justice, and of six Members chosen by the National
Assembly, three of whom shall be nominated by the party
having the largest number of votes, and three by the party
having the second largest number of votes therein. The senior
Justice in the Commission shall be its chairman. The Electoral
Commission shall be the sole judge of the election, returns,
and qualifications of the Members of the National Assembly.
When the foregoing draft was submitted for approval on February 8,
1935, the Style Committee, through President Recto, to effectuate the
original intention of the Convention, agreed to insert the phrase "All
contests relating to" between the phrase "judge of" and the words "the
elections", which was accordingly accepted by the Convention.
The transfer of the power of determining the election, returns and
qualifications of the members of the legislature long lodged in the
legislative body, to an independent, impartial and non-partisan tribunal,
is by no means a mere experiment in the science of government.
Cushing, in his Law and Practice of Legislative Assemblies (ninth
edition, chapter VI, pages 57, 58), gives a vivid account of the
"scandalously notorious" canvassing of votes by political parties in the
disposition of contests by the House of Commons in the following
passages which are partly quoted by the petitioner in his printed
memorandum of March 14, 1936:
153. From the time when the commons established their right
to be the exclusive judges of the elections, returns, and
qualifications of their members, until the year 1770, two
modes of proceeding prevailed, in the determination of
controverted elections, and rights of membership. One of the
standing committees appointed at the commencement of
each session, was denominated the committee of privileges
and elections, whose functions was to hear and investigate all
questions of this description which might be referred to them,
and to report their proceedings, with their opinion thereupon,
to the house, from time to time. When an election petition was
referred to this committee they heard the parties and their
witnesses and other evidence, and made a report of all the
evidence, together with their opinion thereupon, in the form of
resolutions, which were considered and agreed or disagreed
to by the house. The other mode of proceeding was by a
hearing at the bar of the house itself. When this court was
adopted, the case was heard and decided by the house, in
substantially the same manner as by a committee. The
committee of privileges and elections although a select
committee. The committee of privileges and elections
although a select committee was usually what is called an
open one; that is to say, in order to constitute the committee,
a quorum of the members named was required to be present,
but all the members of the house were at liberty to attend the
committee and vote if they pleased.
154. With the growth of political parties in parliament
questions relating to the right of membership gradually
assumed a political character; so that for many years previous
to the year 1770, controverted elections had been tried and
determined by the house of commons, as mere party
questions, upon which the strength of contending factions
might be tested. Thus, for Example, in 1741, Sir Robert
Walpole, after repeated attacks upon his government,
resigned his office in consequence of an adverse vote upon
the Chippenham election. Mr. Hatsell remarks, of the trial of
election cases, as conducted under this system, that "Every
principle of decency and justice were notoriously and openly
prostituted, from whence the younger part of the house were
insensibly, but too successfully, induced to adopt the same
licentious conduct in more serious matters, and in questions
of higher importance to the public welfare." Mr. George
Grenville, a distinguished member of the house of commons,
undertook to propose a remedy for the evil, and, on the 7th of
March, 1770, obtained the unanimous leave of the house to
bring in a bill, "to regulate the trial of controverted elections, or
returns of members to serve in parliament." In his speech to
explain his plan, on the motion for leave, Mr. Grenville alluded
to the existing practice in the following terms: "Instead of
trusting to the merits of their respective causes, the principal
dependence of both parties is their private interest among us;
and it is scandalously notorious that we are as earnestly
canvassed to attend in favor of the opposite sides, as if we
were wholly self-elective, and not bound to act by the
principles of justice, but by the discretionary impulse of our
own inclinations; nay, it is well known, that in every contested
election, many members of this house, who are ultimately to
judge in a kind of judicial capacity between the competitors,
enlist themselves as parties in the contention, and take upon
themselves the partial management of the very business,
upon which they should determine with the strictest
impartiality."
155. It was to put an end to the practices thus described, that
Mr. Grenville brought in a bill which met with the approbation
of both houses, and received the royal assent on the 12th of
April, 1770. This was the celebrated law since known by the
name of the Grenville Act; of which Mr. Hatsell declares, that
it "was one of the nobles works, for the honor of the house of
commons, and the security of the constitution, that was ever
devised by any minister or statesman." It is probable, that the
magnitude of the evil, or the apparent success of the remedy,
may have led many of the contemporaries of the measure to
the information of a judgement, which was not acquiesced in
by some of the leading statesmen of the day, and has not
been entirely confirmed by subsequent experience. The bill
was objected to by Lord North, Mr. De Grey, afterwards chief
justice of the common pleas, Mr. Ellis, Mr. Dyson, who had
been clerk of the house, and Mr. Charles James Fox, chiefly
on the ground, that the introduction of the new system was an
essential alteration of the constitution of parliament, and a
total abrogation of one of the most important rights and
jurisdictions of the house of commons.
As early as 1868, the House of Commons in England solved the
problem of insuring the non-partisan settlement of the controverted
elections of its members by abdicating its prerogative to two judges of
the King's Bench of the High Court of Justice selected from a rota in
accordance with rules of court made for the purpose. Having proved
successful, the practice has become imbedded in English jurisprudence
(Parliamentary Elections Act, 1868 [31 & 32 Vict. c. 125] as amended
by Parliamentary Elections and Corrupt Practices Act. 1879 [42 & 43
Vict. c. 75], s. 2; Corrupt and Illegal Practices Preventions Act, 1883 [46
& 47 Vict. c. 51;, s. 70; Expiring Laws Continuance Act, 1911 [1 & 2
Geo. 5, c. 22]; Laws of England, vol. XII, p. 408, vol. XXI, p. 787). In the
Dominion of Canada, election contests which were originally heard by
the Committee of the House of Commons, are since 1922 tried in the
courts. Likewise, in the Commonwealth of Australia, election contests
which were originally determined by each house, are since 1922 tried in
the High Court. In Hungary, the organic law provides that all protests
against the election of members of the Upper House of the Diet are to
be resolved by the Supreme Administrative Court (Law 22 of 1916,
chap. 2, art. 37, par. 6). The Constitution of Poland of March 17, 1921
(art. 19) and the Constitution of the Free City of Danzig of May 13, 1922
(art. 10) vest the authority to decide contested elections to the Diet or
National Assembly in the Supreme Court. For the purpose of deciding
legislative contests, the Constitution of the German Reich of July 1,
1919 (art. 31), the Constitution of the Czechoslovak Republic of
February 29, 1920 (art. 19) and the Constitution of the Grecian
Republic of June 2, 1927 (art. 43), all provide for an Electoral
Commission.
The creation of an Electoral Commission whose membership is
recruited both from the legislature and the judiciary is by no means
unknown in the United States. In the presidential elections of 1876
there was a dispute as to the number of electoral votes received by
each of the two opposing candidates. As the Constitution made no
adequate provision for such a contingency, Congress passed a law on
January 29, 1877 (United States Statutes at Large, vol. 19, chap. 37,
pp. 227-229), creating a special Electoral Commission composed of
five members elected by the Senate, five members elected by the
House of Representatives, and five justices of the Supreme Court, the
fifth justice to be selected by the four designated in the Act. The
decision of the commission was to be binding unless rejected by the
two houses voting separately. Although there is not much of a moral
lesson to be derived from the experience of America in this regard,
judging from the observations of Justice Field, who was a member of
that body on the part of the Supreme Court (Countryman, the Supreme
Court of the United States and its Appellate Power under the
Constitution [Albany, 1913] — Relentless Partisanship of Electoral
Commission, p. 25 et seq.), the experiment has at least abiding
historical interest.
The members of the Constitutional Convention who framed our
fundamental law were in their majority men mature in years and
experience. To be sure, many of them were familiar with the history and
political development of other countries of the world. When , therefore,
they deemed it wise to create an Electoral Commission as a
constitutional organ and invested it with the exclusive function of
passing upon and determining the election, returns and qualifications of
the members of the National Assembly, they must have done so not
only in the light of their own experience but also having in view the
experience of other enlightened peoples of the world. The creation of
the Electoral Commission was designed to remedy certain evils of
which the framers of our Constitution were cognizant. Notwithstanding
the vigorous opposition of some members of the Convention to its
creation, the plan, as hereinabove stated, was approved by that body
by a vote of 98 against 58. All that can be said now is that, upon the
approval of the constitutional the creation of the Electoral Commission
is the expression of the wisdom and "ultimate justice of the people".
(Abraham Lincoln, First Inaugural Address, March 4, 1861.)
From the deliberations of our Constitutional Convention it is evident that
the purpose was to transfer in its totality all the powers previously
exercised by the legislature in matters pertaining to contested elections
of its members, to an independent and impartial tribunal. It was not so
much the knowledge and appreciation of contemporary constitutional
precedents, however, as the long-felt need of determining legislative
contests devoid of partisan considerations which prompted the people,
acting through their delegates to the Convention, to provide for this
body known as the Electoral Commission. With this end in view, a
composite body in which both the majority and minority parties are
equally represented to off-set partisan influence in its deliberations was
created, and further endowed with judicial temper by including in its
membership three justices of the Supreme Court.
The Electoral Commission is a constitutional creation, invested with the
necessary authority in the performance and execution of the limited and
specific function assigned to it by the Constitution. Although it is not a
power in our tripartite scheme of government, it is, to all intents and
purposes, when acting within the limits of its authority, an independent
organ. It is, to be sure, closer to the legislative department than to any
other. The location of the provision (section 4) creating the Electoral
Commission under Article VI entitled "Legislative Department" of our
Constitution is very indicative. Its compositions is also significant in that
it is constituted by a majority of members of the legislature. But it is a
body separate from and independent of the legislature.
The grant of power to the Electoral Commission to judge all contests
relating to the election, returns and qualifications of members of the
National Assembly, is intended to be as complete and unimpaired as if
it had remained originally in the legislature. The express lodging of that
power in the Electoral Commission is an implied denial of the exercise
of that power by the National Assembly. And this is as effective a
restriction upon the legislative power as an express prohibition in the
Constitution (Ex parte Lewis, 45 Tex. Crim. Rep., 1; State vs. Whisman,
36 S.D., 260; L.R.A., 1917B, 1). If we concede the power claimed in
behalf of the National Assembly that said body may regulate the
proceedings of the Electoral Commission and cut off the power of the
commission to lay down the period within which protests should be
filed, the grant of power to the commission would be ineffective. The
Electoral Commission in such case would be invested with the power to
determine contested cases involving the election, returns and
qualifications of the members of the National Assembly but subject at
all times to the regulative power of the National Assembly. Not only
would the purpose of the framers of our Constitution of totally
transferring this authority from the legislative body be frustrated, but a
dual authority would be created with the resultant inevitable clash of
powers from time to time. A sad spectacle would then be presented of
the Electoral Commission retaining the bare authority of taking
cognizance of cases referred to, but in reality without the necessary
means to render that authority effective whenever and whenever the
National Assembly has chosen to act, a situation worse than that
intended to be remedied by the framers of our Constitution. The power
to regulate on the part of the National Assembly in procedural matters
will inevitably lead to the ultimate control by the Assembly of the entire
proceedings of the Electoral Commission, and, by indirection, to the
entire abrogation of the constitutional grant. It is obvious that this result
should not be permitted.
We are not insensible to the impassioned argument or the learned
counsel for the petitioner regarding the importance and necessity of
respecting the dignity and independence of the national Assembly as a
coordinate department of the government and of according validity to its
acts, to avoid what he characterized would be practically an unlimited
power of the commission in the admission of protests against members
of the National Assembly. But as we have pointed out hereinabove, the
creation of the Electoral Commission carried with it ex necesitate rei the
power regulative in character to limit the time with which protests
intrusted to its cognizance should be filed. It is a settled rule of
construction that where a general power is conferred or duty enjoined,
every particular power necessary for the exercise of the one or the
performance of the other is also conferred (Cooley, Constitutional
Limitations, eight ed., vol. I, pp. 138, 139). In the absence of any further
constitutional provision relating to the procedure to be followed in filing
protests before the Electoral Commission, therefore, the incidental
power to promulgate such rules necessary for the proper exercise of its
exclusive power to judge all contests relating to the election, returns
and qualifications of members of the National Assembly, must be
deemed by necessary implication to have been lodged also in the
Electoral Commission.
It is, indeed, possible that, as suggested by counsel for the petitioner,
the Electoral Commission may abuse its regulative authority by
admitting protests beyond any reasonable time, to the disturbance of
the tranquillity and peace of mind of the members of the National
Assembly. But the possibility of abuse is not argument against the
concession of the power as there is no power that is not susceptible of
abuse. In the second place, if any mistake has been committed in the
creation of an Electoral Commission and in investing it with exclusive
jurisdiction in all cases relating to the election, returns, and
qualifications of members of the National Assembly, the remedy is
political, not judicial, and must be sought through the ordinary
processes of democracy. All the possible abuses of the government are
not intended to be corrected by the judiciary. We believe, however, that
the people in creating the Electoral Commission reposed as much
confidence in this body in the exclusive determination of the specified
cases assigned to it, as they have given to the Supreme Court in the
proper cases entrusted to it for decision. All the agencies of the
government were designed by the Constitution to achieve specific
purposes, and each constitutional organ working within its own
particular sphere of discretionary action must be deemed to be
animated with the same zeal and honesty in accomplishing the great
ends for which they were created by the sovereign will. That the
actuations of these constitutional agencies might leave much to be
desired in given instances, is inherent in the perfection of human
institutions. In the third place, from the fact that the Electoral
Commission may not be interfered with in the exercise of its legitimate
power, it does not follow that its acts, however illegal or
unconstitutional, may not be challenge in appropriate cases over which
the courts may exercise jurisdiction.
But independently of the legal and constitutional aspects of the present
case, there are considerations of equitable character that should not be
overlooked in the appreciation of the intrinsic merits of the controversy.
The Commonwealth Government was inaugurated on November 15,
1935, on which date the Constitution, except as to the provisions
mentioned in section 6 of Article XV thereof, went into effect. The new
National Assembly convened on November 25th of that year, and the
resolution confirming the election of the petitioner, Jose A. Angara was
approved by that body on December 3, 1935. The protest by the herein
respondent Pedro Ynsua against the election of the petitioner was filed
on December 9 of the same year. The pleadings do not show when the
Electoral Commission was formally organized but it does appear that
on December 9, 1935, the Electoral Commission met for the first time
and approved a resolution fixing said date as the last day for the filing
of election protest. When, therefore, the National Assembly passed its
resolution of December 3, 1935, confirming the election of the petitioner
to the National Assembly, the Electoral Commission had not yet met;
neither does it appear that said body had actually been organized. As a
mater of fact, according to certified copies of official records on file in
the archives division of the National Assembly attached to the record of
this case upon the petition of the petitioner, the three justices of the
Supreme Court the six members of the National Assembly constituting
the Electoral Commission were respectively designated only on
December 4 and 6, 1935. If Resolution No. 8 of the National Assembly
confirming non-protested elections of members of the National
Assembly had the effect of limiting or tolling the time for the
presentation of protests, the result would be that the National Assembly
— on the hypothesis that it still retained the incidental power of
regulation in such cases — had already barred the presentation of
protests before the Electoral Commission had had time to organize
itself and deliberate on the mode and method to be followed in a matter
entrusted to its exclusive jurisdiction by the Constitution. This result was
not and could not have been contemplated, and should be avoided.
From another angle, Resolution No. 8 of the National Assembly
confirming the election of members against whom no protests had been
filed at the time of its passage on December 3, 1935, can not be
construed as a limitation upon the time for the initiation of election
contests. While there might have been good reason for the legislative
practice of confirmation of the election of members of the legislature at
the time when the power to decide election contests was still lodged in
the legislature, confirmation alone by the legislature cannot be
construed as depriving the Electoral Commission of the authority
incidental to its constitutional power to be "the sole judge of all contest
relating to the election, returns, and qualifications of the members of the
National Assembly", to fix the time for the filing of said election protests.
Confirmation by the National Assembly of the returns of its members
against whose election no protests have been filed is, to all legal
purposes, unnecessary. As contended by the Electoral Commission in
its resolution of January 23, 1936, overruling the motion of the herein
petitioner to dismiss the protest filed by the respondent Pedro Ynsua,
confirmation of the election of any member is not required by the
Constitution before he can discharge his duties as such member. As a
matter of fact, certification by the proper provincial board of canvassers
is sufficient to entitle a member-elect to a seat in the national Assembly
and to render him eligible to any office in said body (No. 1, par. 1, Rules
of the National Assembly, adopted December 6, 1935).
Under the practice prevailing both in the English House of Commons
and in the Congress of the United States, confirmation is neither
necessary in order to entitle a member-elect to take his seat. The return
of the proper election officers is sufficient, and the member-elect
presenting such return begins to enjoy the privileges of a member from
the time that he takes his oath of office (Laws of England, vol. 12, pp.
331. 332; vol. 21, pp. 694, 695; U. S. C. A., Title 2, secs. 21, 25, 26).
Confirmation is in order only in cases of contested elections where the
decision is adverse to the claims of the protestant. In England, the
judges' decision or report in controverted elections is certified to the
Speaker of the House of Commons, and the House, upon being
informed of such certificate or report by the Speaker, is required to
enter the same upon the Journals, and to give such directions for
confirming or altering the return, or for the issue of a writ for a new
election, or for carrying into execution the determination as
circumstances may require (31 & 32 Vict., c. 125, sec. 13). In the
United States, it is believed, the order or decision of the particular
house itself is generally regarded as sufficient, without any actual
alternation or amendment of the return (Cushing, Law and Practice of
Legislative Assemblies, 9th ed., sec. 166).
Under the practice prevailing when the Jones Law was still in force,
each house of the Philippine Legislature fixed the time when protests
against the election of any of its members should be filed. This was
expressly authorized by section 18 of the Jones Law making each
house the sole judge of the election, return and qualifications of its
members, as well as by a law (sec. 478, Act No. 3387) empowering
each house to respectively prescribe by resolution the time and manner
of filing contest in the election of member of said bodies. As a matter of
formality, after the time fixed by its rules for the filing of protests had
already expired, each house passed a resolution confirming or
approving the returns of such members against whose election no
protests had been filed within the prescribed time. This was interpreted
as cutting off the filing of further protests against the election of those
members not theretofore contested (Amistad vs. Claravall [Isabela],
Second Philippine Legislature, Record — First Period, p. 89; Urguello
vs. Rama [Third District, Cebu], Sixth Philippine Legislature; Fetalvero
vs. Festin [Romblon], Sixth Philippine Legislature, Record — First
Period, pp. 637-640; Kintanar vs. Aldanese [Fourth District, Cebu],
Sixth Philippine Legislature, Record — First Period, pp. 1121, 1122;
Aguilar vs. Corpus [Masbate], Eighth Philippine Legislature, Record —
First Period, vol. III, No. 56, pp. 892, 893). The Constitution has
repealed section 18 of the Jones Law. Act No. 3387, section 478, must
be deemed to have been impliedly abrogated also, for the reason that
with the power to determine all contest relating to the election, returns
and qualifications of members of the National Assembly, is inseparably
linked the authority to prescribe regulations for the exercise of that
power. There was thus no law nor constitutional provisions which
authorized the National Assembly to fix, as it is alleged to have fixed on
December 3, 1935, the time for the filing of contests against the
election of its members. And what the National Assembly could not do
directly, it could not do by indirection through the medium of
confirmation.
Summarizing, we conclude:
(a) That the government established by the Constitution
follows fundamentally the theory of separation of power into
the legislative, the executive and the judicial.
(b) That the system of checks and balances and the
overlapping of functions and duties often makes difficult the
delimitation of the powers granted.
(c) That in cases of conflict between the several departments
and among the agencies thereof, the judiciary, with the
Supreme Court as the final arbiter, is the only constitutional
mechanism devised finally to resolve the conflict and allocate
constitutional boundaries.
(d) That judicial supremacy is but the power of judicial review
in actual and appropriate cases and controversies, and is the
power and duty to see that no one branch or agency of the
government transcends the Constitution, which is the source
of all authority.
(e) That the Electoral Commission is an independent
constitutional creation with specific powers and functions to
execute and perform, closer for purposes of classification to
the legislative than to any of the other two departments of the
governments.
(f ) That the Electoral Commission is the sole judge of all
contests relating to the election, returns and qualifications of
members of the National Assembly.
(g) That under the organic law prevailing before the present
Constitution went into effect, each house of the legislature
was respectively the sole judge of the elections, returns, and
qualifications of their elective members.
(h) That the present Constitution has transferred all the
powers previously exercised by the legislature with respect to
contests relating to the elections, returns and qualifications of
its members, to the Electoral Commission.
(i) That such transfer of power from the legislature to the
Electoral Commission was full, clear and complete, and
carried with it ex necesitate rei the implied power inter alia to
prescribe the rules and regulations as to the time and manner
of filing protests.
( j) That the avowed purpose in creating the Electoral
Commission was to have an independent constitutional organ
pass upon all contests relating to the election, returns and
qualifications of members of the National Assembly, devoid of
partisan influence or consideration, which object would be
frustrated if the National Assembly were to retain the power to
prescribe rules and regulations regarding the manner of
conducting said contests.
(k) That section 4 of article VI of the Constitution repealed not
only section 18 of the Jones Law making each house of the
Philippine Legislature respectively the sole judge of the
elections, returns and qualifications of its elective members,
but also section 478 of Act No. 3387 empowering each house
to prescribe by resolution the time and manner of filing
contests against the election of its members, the time and
manner of notifying the adverse party, and bond or bonds, to
be required, if any, and to fix the costs and expenses of
contest.
(l) That confirmation by the National Assembly of the election
is contested or not, is not essential before such member-elect
may discharge the duties and enjoy the privileges of a
member of the National Assembly.
(m) That confirmation by the National Assembly of the
election of any member against whom no protest had been
filed prior to said confirmation, does not and cannot deprive
the Electoral Commission of its incidental power to prescribe
the time within which protests against the election of any
member of the National Assembly should be filed.
We hold, therefore, that the Electoral Commission was acting within the
legitimate exercise of its constitutional prerogative in assuming to take
cognizance of the protest filed by the respondent Pedro Ynsua against
the election of the herein petitioner Jose A. Angara, and that the
resolution of the National Assembly of December 3, 1935 can not in
any manner toll the time for filing protests against the elections, returns
and qualifications of members of the National Assembly, nor prevent
the filing of a protest within such time as the rules of the Electoral
Commission might prescribe.
In view of the conclusion reached by us relative to the character of the
Electoral Commission as a constitutional creation and as to the scope
and extent of its authority under the facts of the present controversy, we
deem it unnecessary to determine whether the Electoral Commission is
an inferior tribunal, corporation, board or person within the purview of
sections 226 and 516 of the Code of Civil Procedure.
The petition for a writ of prohibition against the Electoral Commission is
hereby denied, with costs against the petitioner. So ordered.
Avanceña, C. J., Diaz, Concepcion, and Horrilleno, JJ., concur.
Separate Opinions
ABAD SANTOS, J., concurring:
I concur in the result and in most of the views so ably expressed in the
preceding opinion. I am, however, constrained to withhold my assent to
certain conclusions therein advanced.
The power vested in the Electoral Commission by the Constitution of
judging of all contests relating to the election, returns, and qualifications
of the members of the National Assembly, is judicial in nature. (Thomas
vs. Loney, 134 U.S., 372; 33 Law. ed., 949, 951.) On the other hand,
the power to regulate the time in which notice of a contested election
may be given, is legislative in character. (M'Elmoyle vs. Cohen, 13 Pet.,
312; 10 Law. ed., 177; Missouri vs. Illinois, 200 U. S. 496; 50 Law. ed.,
572.)
It has been correctly stated that the government established by the
Constitution follows fundamentally the theory of the separation of
powers into legislative, executive, and judicial. Legislative power is
vested in the National Assembly. (Article VI, sec. 1.) In the absence of
any clear constitutional provision to the contrary, the power to regulate
the time in which notice of a contested election may be given, must be
deemed to be included in the grant of legislative power to the National
Assembly.
The Constitution of the United States contains a provision similar to the
that found in Article VI, section 4, of the Constitution of the Philippines.
Article I, section 5, of the Constitution of the United States provides that
each house of the Congress shall be the judge of the elections, returns,
and qualifications of its own members. Notwithstanding this provision,
the Congress has assumed the power to regulate the time in which
notice of a contested election may be given. Thus section 201, Title 2,
of the United States Code Annotated prescribes:
Whenever any person intends to contest an election of any
Member of the House of Representatives of the United
States, he shall, within thirty days after the result of such
election shall have been determined by the officer or board of
canvassers authorized by law to determine the same, give
notice, in writing, to the Member whose seat he designs to
contest, of his intention to contest the same, and, in such
notice, shall specify particularly the grounds upon which he
relies in the contest. (R. S., par. 105.)
The Philippine Autonomy Act, otherwise known as the Jones Law, also
contained a provision to the effect that the Senate and House of
Representatives, respectively, shall be the sole judges of the elections,
returns, and qualifications of their elective members. Notwithstanding
this provision, the Philippine Legislature passed the Election Law,
section 478 of which reads as follows:
The Senate and the House of Representatives shall by
resolution respectively prescribe the time and manner of filing
contest in the election of members of said bodies, the time
and manner of notifying the adverse party, and bond or
bonds, to be required, if any, and shall fix the costs and
expenses of contest which may be paid from their respective
funds.
The purpose sought to be attained by the creation of the Electoral
Commission was not to erect a body that would be above the law, but
to raise legislative elections contests from the category of political to
that of justiciable questions. The purpose was not to place the
commission beyond the reach of the law, but to insure the
determination of such contests with the due process of law.
Section 478 of the Election Law was in force at the time of the adoption
of the Constitution, Article XV, section 2, of which provides that —
 All laws of the Philippine Islands shall continue in force until
the inauguration of the Commonwealth of the Philippines;
thereafter, such laws shall remain operative, unless
inconsistent with this Constitution, until amended, altered,
modified, or repealed by the National Assembly, and all
references in such laws to the Government or officials of the
Philippine Islands shall be construed, in so far as applicable,
to refer to the Government and corresponding officials under
this Constitution.
The manifest purpose of this constitutional provision was to insure the
orderly processes of government, and to prevent any hiatus in its
operations after the inauguration of the Commonwealth of the
Philippines. It was thus provided that all laws of the Philippine Islands
shall remain operative even after the inauguration of the
Commonwealth of the Philippines, unless inconsistent with the
Constitution, and that all references in such laws to the government or
officials of the Philippine Islands shall be construed, in so far as
applicable, to refer to the government and corresponding officials under
the Constitution. It would seem to be consistent not only with the spirit
but the letter of the Constitution to hold that section 478 of the Election
Law remains operative and should now be construed to refer to the
Electoral Commission, which, in so far as the power to judge election
contests is concerned, corresponds to either the Senate or the House
of Representative under the former regime. It is important to observe in
this connection that said section 478 of the Election Law vested the
power to regulate the time and manner in which notice of a contested
election may be given, not in the Philippine Legislature but in the
Senate and House of Representatives singly. In other words, the
authority to prescribe the time and manner of filing contests in the
elections of members of the Philippine Legislature was by statute
lodged separately in the bodies clothed with power to decide such
contests. Construing section 478 of the Election Law to refer to the
National Assembly, as required by Article XV, section 2, of the
Constitution, it seems reasonable to conclude that the authority to
prescribe the time and manner of filing contests in the election of
members of the National Assembly is vested in the Electoral
Commission, which is now the body clothed with power to decide such
contests.
In the light of what has been said, the resolution of the National
Assembly of December 3, 1935, could not have the effect of barring the
right of the respondent Pedro Ynsua to contest the election of the
petitioner. By the same token, the Electoral Commission was
authorized by law to adopt its resolution of December 9, 1935, which
fixed the time with in which written contests must be filed with the
commission.
Having been filed within the time fixed by its resolutions, the Electoral
Commission has jurisdiction to hear and determine the contest filed by
the respondent Pedro Ynsua against the petitioner Jose A. Angara.
G.R. No. L-5279           October 31, 1955
PHILIPPINE ASSOCIATION OF COLLEGES AND UNIVERSITIES,
ETC., petitioner,
vs.
SECRETARY OF EDUCATION and the BOARD OF TEXTBOOKS,
respondents.
Manuel C. Briones, Vicente G. Sinco, Manuel V. Gallego and Enrique
M. Fernando for petitioner.
Office of the Solicitor General Pompeyo Diaz and Assistant Solicitor
General Francisco Carreon for respondents.
BENGZON, J.:
The petitioning colleges and universities request that Act No. 2706 as
amended by Act No. 3075 and Commonwealth Act No. 180 be declared
unconstitutional, because: A. They deprive owners of schools and
colleges as well as teachers and parents of liberty and property without
due process of law; B. They deprive parents of their natural rights and
duty to rear their children for civic efficiency; and C. Their provisions
conferring on the Secretary of Education unlimited power and discretion
to prescribe rules and standards constitute an unlawful delegation of
legislative power.
A printed memorandum explaining their position in extenso is attached
to the record.
The Government's legal representative submitted a mimeographed
memorandum contending that, (1) the matter constitutes no justiciable
controversy exhibiting unavoidable necessity of deciding the
constitutional questions; (2) petitioners are in estoppel to challenge the
validity of the said acts; and (3) the Acts are constitutionally valid.
Petitioners submitted a lengthy reply to the above arguments.
Act No. 2706 approved in 1917 is entitled, "An Act making the
inspection and recognition of private schools and colleges obligatory for
the Secretary of Public Instruction." Under its provisions, the
Department of Education has, for the past 37 years, supervised and
regulated all private schools in this country apparently without audible
protest, nay, with the general acquiescence of the general public and
the parties concerned.
It should be understandable, then, that this Court should be doubly
reluctant to consider petitioner's demand for avoidance of the law
aforesaid, specially where, as respondents assert, petitioners suffered
no wrong—nor allege any—from the enforcement of the criticized
statute.
It must be evident to any one that the power to declare a
legislative enactment void is one which the judge, conscious
of the fallability of the human judgment, will shrink from
exercising in any case where he can conscientiously and with
due regard to duty and official oath decline the responsibility.
(Cooley Constitutional Limitations, 8th Ed., Vol. I, p. 332.)
When a law has been long treated as constitutional and
important rights have become dependent thereon, the Court
may refuse to consider an attack on its validity. (C. J. S. 16, p.
204.)
As a general rule, the constitutionality of a statute will be
passed on only if, and to the extent that, it is directly and
necessarily involved in a justiciable controversy and is
essential to the protection of the rights of the parties
concerned. (16 C. J. S., p. 207.)
In support of their first proposition petitioners contend that the right of a
citizen to own and operate a school is guaranteed by the Constitution,
and any law requiring previous governmental approval or permit before
such person could exercise said right, amounts to censorship of
previous restraint, a practice abhorent to our system of law and
government. Petitioners obviously refer to section 3 of Act No. 2706 as
amended which provides that before a private school may be opened to
the public it must first obtain a permit from the Secretary of Education.
The Solicitor General on the other hand points out that none of the
petitioners has cause to present this issue, because all of them have
permits to operate and are actually operating by virtue of their permits. 1
And they do not assert that the respondent Secretary of Education has
threatened to revoke their permits. They have suffered no wrong under
the terms of law—and, naturally need no relief in the form they now
seek to obtain.
It is an established principle that to entitle a private individual
immediately in danger of sustaining a direct injury as the
result of that action and it is not sufficient that he has merely a
general to invoke the judicial power to determine the validity
of executive or legislative action he must show that he has
sustained or is interest common to all members of the public.
(Ex parte Levitt, 302 U. S. 633 82 L. Ed. 493.)
Courts will not pass upon the constitutionality of a law upon
the complaint of one who fails to show that he is injured by its
operation. (Tyler vs. Judges, 179 U. S. 405; Hendrick vs.
Maryland, 235 U. S. 610; Coffman vs. Breeze Corp., 323 U.
S. 316-325.)
The power of courts to declare a law unconstitutional arises
only when the interests of litigant require the use of that
judicial authority for their protection against actual
interference, a hypothetical threat being insufficient. (United
Public Works vs. Mitchell, 330 U .S. 75; 91 L. Ed. 754.)
Bona fide suit.—Judicial power is limited to the decision of
actual cases and controversies. The authority to pass on the
validity of statutes is incidental to the decision of such cases
where conflicting claims under the Constitution and under a
legislative act assailed as contrary to the Constitution are
raised. It is legitimate only in the last resort, and as necessity
in the determination of real, earnest, and vital controversy
between litigants. (Tañada and Fernando, Constitution of the
Philippines, p. 1138.)
Mere apprehension that the Secretary of Education might under the law
withdraw the permit of one of petitioners does not constitute a
justiciable controversy. (Cf. Com. ex rel Watkins vs. Winchester
Waterworks (Ky.) 197 S. W. 2d. 771.)
And action, like this, is brought for a positive purpose, nay, to obtain
actual and positive relief. (Salonga vs. Warner Barnes, L-2245,
January, 1951.) Courts do not sit to adjudicate mere academic
questions to satisfy scholarly interest therein, however intellectually
solid the problem may be. This is specially true where the issues "reach
constitutional dimensions, for then there comes into play regard for the
court's duty to avoid decision of constitutional issues unless avoidance
becomes evasion." (Rice vs. Sioux City, U. S. Sup. Ct. Adv. Rep., May
23, 1995, Law Ed., Vol. 99, p. 511.)
The above notwithstanding, in view of the several decisions of the
United States Supreme Court quoted by petitioners, apparently
outlawing censorship of the kind objected to by them, we have decided
to look into the matter, lest they may allege we refuse to act even in the
face of clear violation of fundamental personal rights of liberty and
property.
Petitioners complain that before opening a school the owner must
secure a permit from the Secretary of Education. Such requirement was
not originally included in Act No. 2706. It was introduced by
Commonwealth Act No. 180 approved in 1936. Why?
In March 1924 the Philippine Legislature approved Act No. 3162
creating a Board of Educational Survey to make a study and survey of
education in the Philippines and of all educational institutions, facilities
and agencies thereof. A Board chairmaned by Dr. Paul Munroe,
Columbia University, assisted by a staff of carefully selected technical
members performed the task, made a five-month thorough and
impartial examination of the local educational system, and submitted a
report with recommendations, printed as a book of 671 pages. The
following paragraphs are taken from such report:
PRIVATE-ADVENTURE SCHOOLS
There is no law or regulation in the Philippine Islands today to
prevent a person, however disqualified by ignorance, greed,
or even immoral character, from opening a school to teach the
young. It it true that in order to post over the door
"Recognized by the Government," a private adventure school
must first be inspected by the proper Government official, but
a refusal to grant such recognition does not by any means
result in such a school ceasing to exist. As a matter of fact,
there are more such unrecognized private schools than of the
recognized variety. How many, no one knows, as the Division
of Private Schools keeps records only of the recognized type.
Conclusion.—An unprejudiced consideration of the fact
presented under the caption Private Adventure Schools leads
but to one conclusion, viz.: the great majority of them from
primary grade to university are money-making devices for the
profit of those who organize and administer them. The people
whose children and youth attend them are not getting what
they pay for. It is obvious that the system constitutes a great
evil. That it should be permitted to exist with almost no
supervision is indefensible. The suggestion has been made
with the reference to the private institutions of university grade
that some board of control be organized under legislative
control to supervise their administration. The Commission
believes that the recommendations it offers at the end of this
chapter are more likely to bring about the needed reforms.
Recommendations.—The Commission recommends that
legislation be enacted to prohibit the opening of any school by
an individual or organization without the permission of the
Secretary of Public Instruction. That before granting such
permission the Secretary assure himself that such school
measures up to proper standards in the following respects,
and that the continued existence of the school be dependent
upon its continuing to conform to these conditions:
(1) The location and construction of the buildings, the lighting
and ventilation of the rooms, the nature of the lavatories,
closets, water supply, school furniture and apparatus, and
 methods of cleaning shall be such as to insure hygienic
conditions for both pupils and teachers.
(2) The library and laboratory facilities shall be adequate to
the needs of instruction in the subjects taught.
(3) The classes shall not show an excessive number of pupils
per teacher. The Commission recommends 40 as a
maximum.
(4) The teachers shall meet qualifications equal to those of
teachers in the public schools of the same grade.
xxx           xxx           xxx
In view of these findings and recommendations, can there be any doubt
that the Government in the exercise of its police power to correct "a
great evil" could validly establish the "previous permit" system objected
to by petitioners? This is what differentiates our law from the other
statutes declared invalid in other jurisdictions. And if any doubt still
exists, recourse may now be had to the provision of our Constitution
that "All educational institutions shall be under the supervision and
subject to regulation by the State." (Art. XIV, sec. 5.) The power to
regulate establishments or business occupations implies the power to
require a permit or license. (53 C. J. S. 4.)
What goes for the "previous permit" naturally goes for the power to
revoke such permit on account of violation of rules or regulations of the
Department.
II. This brings us to the petitioners' third proposition that the questioned
statutes "conferring on the Secretary of Education unlimited power and
discretion to prescribe rules and standards constitute an unlawful
delegation of legislative power."
This attack is specifically aimed at section 1 of Act No. 2706 which, as
amended, provides:
It shall be the duty of the Secretary of Public Instruction to
maintain a general standard of efficiency in all private schools
and colleges of the Philippines so that the same shall furnish
adequate instruction to the public, in accordance with the
class and grade of instruction given in them, and for this
purpose said Secretary or his duly authorized representative
shall have authority to advise, inspect, and regulate said
schools and colleges in order to determine the efficiency of
instruction given in the same,
"Nowhere in this Act" petitioners argue "can one find any description,
either general or specific, of what constitutes a 'general standard of
efficiency.' Nowhere in this Act is there any indication of any basis or
condition to ascertain what is 'adequate instruction to the public.'
Nowhere in this Act is there any statement of conditions, acts, or
factors, which the Secretary of Education must take into account to
determine the 'efficiency of instruction.'"
The attack on this score is also extended to section 6 which provides:
The Department of Education shall from time to time prepare
and publish in pamphlet form the minimum standards required
of primary, intermediate, and high schools, and colleges
granting the degrees of Bachelor of Arts, Bachelor of Science,
or any other academic degree. It shall also from time to time
prepare and publish in pamphlet form the minimum standards
required of law, medical, dental, pharmaceutical, engineering,
agricultural and other medical or vocational schools or
colleges giving instruction of a technical, vocational or
professional character.
Petitioners reason out, "this section leaves everything to the
uncontrolled discretion of the Secretary of Education or his department.
The Secretary of Education is given the power to fix the standard. In
plain language, the statute turns over to the Secretary of Education the
exclusive authority of the legislature to formulate standard. . . .."
It is quite clear the two sections empower and require the Secretary of
Education to prescribe rules fixing minimum standards of adequate and
efficient instruction to be observed by all such private schools and
colleges as may be permitted to operate. The petitioners contend that
as the legislature has not fixed the standards, "the provision is
extremely vague, indefinite and uncertain"—and for that reason
constitutionality objectionable. The best answer is that despite such
alleged vagueness the Secretary of Education has fixed standards to
ensure adequate and efficient instruction, as shown by the memoranda
fixing or revising curricula, the school calendars, entrance and final
examinations, admission and accreditation of students etc.; and the
system of private education has, in general, been satisfactorily in
operation for 37 years. Which only shows that the Legislature did and
could, validly rely upon the educational experience and training of those
in charge of the Department of Education to ascertain and formulate
minimum requirements of adequate instruction as the basis of
government recognition of any private school.
At any rate, petitioners do not show how these standards have injured
any of them or interfered with their operation. Wherefore, no reason
exists for them to assail the validity of the power nor the exercise of the
power by the Secretary of Education.
True, the petitioners assert that, the Secretary has issued rules and
regulations "whimsical and capricious" and that such discretionary
power has produced arrogant inspectors who "bully heads and teachers
of private schools." Nevertheless, their remedy is to challenge those
regulations specifically, and/or to ring those inspectors to book, in
proper administrative or judicial proceedings—not to invalidate the law.
For it needs no argument, to show that abuse by the officials entrusted
with the execution of a statute does not per se demonstrate the
unconstitutionality of such statute.
Anyway, we find the defendants' position to be sufficiently sustained by
the decision in Alegra vs. Collector of Customs, 53 Phil., 394 upon
holding the statute that authorized the Director of Agriculture to
"designate standards for the commercial grades of abaca, maguey and
sisal" against vigorous attacks on the ground of invalid delegation of
legislative power.
Indeed "adequate and efficient instruction" should be considered
sufficient, in the same way as "public welfare" "necessary in the interest
of law and order" "public interest" and "justice and equity and
substantial merits of the case" have been held sufficient as legislative
standards justifying delegation of authority to regulate. (See Tañada
and Fernando, Constitution of the Philippines, p. 793, citing Philippine
cases.)
On this phase of the litigation we conclude that there has been no
undue delegation of legislative power.
In this connection, and to support their position that the law and the
Secretary of Education have transcended the governmental power of
supervision and regulation, the petitioners appended a list of circulars
and memoranda issued by the said Department. However they failed to
indicate which of such official documents was constitutionally
objectionable for being "capricious," or pain "nuisance"; and it is one of
our decisional practices that unless a constitutional point is specifically
raised, insisted upon and adequately argued, the court will not consider
it. (Santiago vs. Far Eastern, 73 Phil., 408.)
We are told that such list will give an idea of how the statute has placed
in the hands of the Secretary of Education complete control of the
various activities of private schools, and why the statute should be
struck down as unconstitutional. It is clear in our opinion that the statute
does not in express terms give the Secretary complete control. It gives
him powers to inspect private schools, to regulate their activities, to give
them official permits to operate under certain conditions, and to revoke
such permits for cause. This does not amount to complete control. If
any of such Department circulars or memoranda issued by the
Secretary go beyond the bounds of regulation and seeks to establish
complete control, it would surely be invalid. Conceivably some of them
are of this nature, but besides not having before us the text of such
circulars, the petitioners have omitted to specify. In any event with the
recent approval of Republic Act No. 1124 creating the National Board of
Education, opportunity for administrative correction of the supposed
anomalies or encroachments is amply afforded herein petitioners. A
more expeditious and perhaps more technically competent forum
exists, wherein to discuss the necessity, convenience or relevancy of
the measures criticized by them. (See also Republic Act No. 176.)
If however the statutes in question actually give the Secretary control
over private schools, the question arises whether the power of
supervision and regulation granted to the State by section 5 Article XIV
was meant to include control of private educational institutions. It is
enough to point out that local educators and writers think the
Constitution provides for control of Education by the State. (See
Tolentino, Government of the Philippine Constitution, Vol. II, p. 615;
Benitez, Philippine Social Life and Progress, p. 335.)
The Constitution (it) "provides for state control of all educational
institutions" even as it enumerates certain fundamental objectives of all
education to wit, the development of moral character, personal
discipline, civic conscience and vocational efficiency, and instruction in
the duties of citizenship. (Malcolm & Laurel, Philippine Constitutional
Law, 1936.)
The Solicitor General cities many authorities to show that the power to
regulate means power to control, and quotes from the proceedings of
the Constitutional Convention to prove that State control of private
education was intended by the organic law. It is significant to note that
the Constitution grants power to supervise and to regulate. Which may
mean greater power than mere regulation.
III. Another grievance of petitioners—probably the most significant—is
the assessment of 1 per cent levied on gross receipts of all private
schools for additional Government expenses in connection with their
supervision and regulation. The statute is section 11-A of Act No. 2706
as amended by Republic Act No. 74 which reads as follows:
SEC. 11-A. The total annual expense of the Office of Private
Education shall be met by the regular amount appropriated in
the annual Appropriation Act: Provided, however, That for
additional expenses in the supervision and regulation of
private schools, colleges and universities and in the purchase
of textbook to be sold to student of said schools, colleges and
universities and President of the Philippines may authorize
the Secretary of Instruction to levy an equitable assessment
 from each private educational institution equivalent to one courts will not shrink from their duty to delimit constitutional boundaries
percent of the total amount accruing from tuition and other and protect individual liberties.
fees: . . . and non-payment of the assessment herein provided IV. For all the foregoing considerations, reserving to the petitioners the
by any private school, college or university shall be sufficient right to institute in the proper court, and at the proper time, such actions
cause for the cancellation by the Secretary of Instruction of as may call for decision of the issue herein presented by them, this
the permit for recognition granted to it. petition for prohibition will be denied. So ordered.
Petitioners maintain that this is a tax on the exercise of a constitutional Paras, C. J., Padilla, Montemayor, Reyes, A., and Jugo, JJ., concur.
right—the right to open a school, the liberty to teach etc. They claim this
is unconstitutional, in the same way that taxes on the privilege of selling
religious literature or of publishing a newspaper—both constitutional
privileges—have been held, in the United States, to be invalid as taxes
on the exercise of a constitutional right.
The Solicitor General on the other hand argues that insofar as
petitioners' action attempts to restrain the further collection of the
assessment, courts have no jurisdiction to restrain the collection of
taxes by injunction, and in so far as they seek to recover fees already
paid the suit, it is one against the State without its consent. Anyway he
concludes, the action involving "the legality of any tax impost or
assessment" falls within the original jurisdiction of Courts of First
Instance.
There are good grounds in support of Government's position. If this levy
of 1 per cent is truly a mere fee—and not a tax—to finance the cost of
the Department's duty and power to regulate and supervise private
schools, the exaction may be upheld; but such point involves
investigation and examination of relevant data, which should best be
carried out in the lower courts. If on the other hand it is a tax,
petitioners' issue would still be within the original jurisdiction of the
Courts of First Instance.
The last grievance of petitioners relates to the validity of Republic Act
No. 139 which in its section 1 provides:
The textbooks to be used in the private schools recognized or
authorized by the government shall be submitted to the Board
(Board of Textbooks) which shall have the power to prohibit
the use of any of said textbooks which it may find to be
against the law or to offend the dignity and honor of the
government and people of the Philippines, or which it may find
to be against the general policies of the government, or which
it may deem pedagogically unsuitable.
This power of the Board, petitioners aver, is censorship in "its baldest
form". They cite two U. S. cases (Miss. and Minnesota) outlawing
statutes that impose previous restraints upon publication of
newspapers, or curtail the right of individuals to disseminate teachings
critical of government institutions or policies.
Herein lies another important issue submitted in the cause. The
question is really whether the law may be enacted in the exercise of the
State's constitutional power (Art. XIV, sec. 5) to supervise and regulate
private schools. If that power amounts to control of private schools, as
some think it is, maybe the law is valid. In this connection we do not
share the belief that section 5 has added new power to what the State
inherently possesses by virtue of the police power. An express power is
necessarily more extensive than a mere implied power. For instance, if
there is conflict between an express individual right and the express
power to control private education it cannot off-hand be said that the
latter must yield to the former—conflict of two express powers. But if
the power to control education is merely implied from the police power,
it is feasible to uphold the express individual right, as was probably the
situation in the two decisions brought to our attention, of Mississippi
and Minnesota, states where constitutional control of private schools is
not expressly produced.
However, as herein previously noted, no justiciable controversy has
been presented to us. We are not informed that the Board on
Textbooks has prohibited this or that text, or that the petitioners refused
or intend to refuse to submit some textbooks, and are in danger of
losing substantial privileges or rights for so refusing.
The average lawyer who reads the above quoted section of Republic
Act 139 will fail to perceive anything objectionable. Why should not the
State prohibit the use of textbooks that are illegal, or offensive to the
Filipinos or adverse to governmental policies or educationally
improper? What's the power of regulation and supervision for? But
those trained to the investigation of constitutional issues are likely to
apprehend the danger to civil liberties, of possible educational
dictatorship or thought control, as petitioners' counsel foresee with
obvious alarm. Much depends, however, upon the execution and
implementation of the statute. Not that constitutionality depends
necessarily upon the law's effects. But if the Board on Textbooks in its
actuations strictly adheres to the letter of the section and wisely steers
a middle course between the Scylla of "dictatorship" and the Charybdis
of "thought control", no cause for complaint will arise and no occasion
for judicial review will develop. Anyway, and again, petitioners now
have a more expeditious remedy thru an administrative appeal to the
National Board of Education created by Republic Act 1124.
Of course it is necessary to assure herein petitioners, that when and if,
the dangers they apprehend materialize and judicial intervention is
suitably invoked, after all administrative remedies are exhausted, the
G.R. No. 118577 March 7, 1995
JUANITO MARIANO, JR. et al., petitioners,
vs.
THE COMMISSION ON ELECTIONS, THE MUNICIPALITY OF
MAKATI, HON. JEJOMAR BINAY, THE MUNICIPAL TREASURER,
AND SANGGUNIANG BAYAN OF MAKATI, respondents.
G.R. No. 118627 March 7, 1995
JOHN R. OSMEÑA, petitioner,
vs.
THE COMMISSION ON ELECTIONS, THE MUNICIPALITY OF
MAKATI, HON. JEJOMAR BINAY, MUNICIPAL TREASURER, AND
SANGGUNIANG BAYAN OF MAKATI, respondents.
PUNO, J.:
At bench are two (2) petitions assailing certain provisions of Republic
Act No. 7854 as unconstitutional. R.A. No. 7854 as unconstitutional.
R.A. No. 7854 is entitled, "An Act Converting the Municipality of Makati
Into a Highly Urbanized City to be known as the City of Makati."1
G.R. No. 118577 involves a petition for prohibition and declaratory
relief. It was filed by petitioners Juanito Mariano, Jr., Ligaya S. Bautista,
Teresita Tibay, Camilo Santos, Frankie Cruz, Ricardo Pascual, Teresita
Abang, Valentina Pitalvero, Rufino Caldoza, Florante Alba, and
Perfecto Alba. Of the petitioners, only Mariano, Jr., is a resident of
Makati. The others are residents of Ibayo Ususan, Taguig, Metro
Manila. Suing as taxpayers, they assail as unconstitutional sections 2,
51, and 52 of R.A. No. 7854 on the following grounds:
1. Section 2 of R.A. No. 7854 did not properly
identify the land area or territorial jurisdiction of
Makati by metes and bounds, with technical
descriptions, in violation of Section 10, Article X of
the Constitution, in relation to Sections 7 and 450 of
the Local Government Code;
2. Section 51 of R.A. No. 7854 attempts to alter or
restart the "three consecutive term" limit for local
elective officials, in violation of Section 8, Article X
and Section 7, Article VI of the Constitution.
3. Section 52 of R.A. No. 7854 is unconstitutional
for:
(a) it increased the legislative
district of Makati only by special
law (the Charter in violation of
the constitutional provision
requiring a general
reapportionment law to be
passed by Congress within three
(3) years following the return of
every census;
(b) the increase in legislative
district was not expressed in the
title of the bill; and
(c) the addition of another
legislative district in Makati is not
in accord with Section 5 (3),
Article VI of the Constitution for
as of the latest survey (1990
census), the population of Makati
stands at only 450,000.
G.R. No. 118627 was filed by the petitioner John H. Osmeña as
senator, taxpayer, and concerned citizen. Petitioner assails section 52
of R.A. No. 7854 as unconstitutional on the same grounds as
aforestated.
We find no merit in the petitions.
I
Section 2, Article I of R.A. No. 7854 delineated the land areas of the
proposed city of Makati, thus:
Sec. 2. The City of Makati. — The Municipality of
Makati shall be converted into a highly urbanized
city to be known as the City of Makati, hereinafter
referred to as the City, which shall comprise the
present territory of the Municipality of Makati in
Metropolitan Manila Area over which it has
jurisdiction bounded on the northeast by Pasig River
and beyond by the City of Mandaluyong and the
Municipality of Pasig; on the southeast by the
municipalities of Pateros and Taguig; on the
southwest by the City of Pasay and the Municipality
of Taguig; and, on the northwest, by the City of
Manila.
The foregoing provision shall be without prejudice to
the resolution by the appropriate agency or forum of
existing boundary disputes or cases involving
questions of territorial jurisdiction between the City
of Makati and the adjoining local government units.
(Emphasis supplied)
In G.R. No. 118577, petitioners claim that this delineation violates
sections 7 and 450 of the Local Government Code which require that
the area of a local government unit should be made by metes and
bounds with technical descriptions.2
The importance of drawing with precise strokes the territorial
boundaries of a local unit of government cannot be overemphasized.
The boundaries must be clear for they define the limits of the territorial
jurisdiction of a local government unit. It can legitimately exercise
powers of government only within the limits, its acts are ultra vires.
Needless to state, any uncertainty in the boundaries of local
government units will sow costly conflicts in the exercise of
governmental powers which ultimately will prejudice the people's
welfare. This is the evil sought to avoided by the Local Government
Code in requiring that the land area of a local government unit must be
spelled out in metes and bounds, with technical descriptions.
Given the facts of the cases at bench, we cannot perceive how this evil
can be brought about by the description made in section 2 of R.A. No.
7854, Petitioners have not demonstrated that the delineation of the land
area of the proposed City of Makati will cause confusion as to its
boundaries. We note that said delineation did not change even by an
inch the land area previously covered by Makati as a municipality.
Section 2 did not add, subtract, divide, or multiply the established land
area of Makati. In language that cannot be any clearer, section 2 stated
that, the city's land area "shall comprise the present territory of the
municipality."
The deliberations of Congress will reveal that there is a legitimate
reason why the land area of the proposed City of Makati was not
defined by metes and bounds, with technical descriptions. At the time of
the consideration of R.A. No. 7854, the territorial dispute between the
municipalities of Makati and Taguig over Fort Bonifacio was under court
litigation. Out of a becoming sense of respect to co-equal department of
government, legislators felt that the dispute should be left to the courts
to decide. They did not want to foreclose the dispute by making a
legislative finding of fact which could decide the issue. This would have
ensued if they defined the land area of the proposed city by its exact
metes and bounds, with technical descriptions.3 We take judicial notice
of the fact that Congress has also refrained from using the metes and
bounds description of land areas of other local government units with
unsettled boundary disputes.4
We hold that the existence of a boundary dispute does not per se
present an insurmountable difficulty which will prevent Congress from
defining with reasonable certitude the territorial jurisdiction of a local
government unit. In the cases at bench, Congress maintained the
existing boundaries of the proposed City of Makati but as an act of
fairness, made them subject to the ultimate resolution by the courts.
Considering these peculiar circumstances, we are not prepared to hold
that section 2 of R.A. No. 7854 is unconstitutional. We sustain the
submission of the Solicitor General in this regard, viz.:
Going now to Sections 7 and 450 of the Local
Government Code, it is beyond cavil that the
requirement stated therein, viz.: "the territorial
jurisdiction of newly created or converted cities
should be described by meted and bounds, with
technical descriptions" — was made in order to
provide a means by which the area of said cities
may be reasonably ascertained. In other words, the
requirement on metes and bounds was meant
merely as tool in the establishment of local
government units. It is not an end in itself. Ergo, so
long as the territorial jurisdiction of a city may be
reasonably ascertained, i.e., by referring to common
boundaries with neighboring municipalities, as in this
case, then, it may be concluded that the legislative
intent behind the law has been sufficiently served.
Certainly, Congress did not intends that laws
creating new cities must contain therein detailed
technical descriptions similar to those appearing in
Torrens titles, as petitioners seem to imply. To
require such description in the law as a condition
sine qua non for its validity would be to defeat the
very purpose which the Local Government Code to
seeks to serve. The manifest intent of the Code is to
empower local government units and to give them
their rightful due. It seeks to make local
governments more responsive to the needs of their
constituents while at the same time serving as a vital
cog in national development. To invalidate R.A. No.
7854 on the mere ground that no cadastral type of
description was used in the law would serve the
letter but defeat the spirit of the Code. It then
becomes a case of the master serving the slave,
instead of the other way around. This could not be
the intendment of the law.
 Too well settled is the rule that laws must be
enforced when ascertained, although it may not be
consistent with the strict letter of the statute. Courts
will not follow the letter of the statute when to do so
would depart from the true intent of the legislature or
would otherwise yield conclusions inconsistent with
the general purpose of the act. (Torres v. Limjap, 56
Phil., 141; Tañada v. Cuenco, 103 Phil. 1051;
Hidalgo v. Hidalgo, 33 SCRA 1105). Legislation is
an active instrument of government, which, for
purposes of interpretation, means that laws have
ends to achieve, and statutes should be so
construed as not to defeat but to carry out such
ends and purposes (Bocolbo v. Estanislao, 72
SCRA 520). The same rule must indubitably apply to
the case at bar.
II
Petitioners in G.R. No. 118577 also assail the constitutionality of
section 51, Article X of R.A. No. 7854. Section 51 states:
Sec. 51. Officials of the City of Makati. — The
represent elective officials of the Municipality of
Makati shall continue as the officials of the City of
Makati and shall exercise their powers and functions
until such time that a new election is held and the
duly elected officials shall have already qualified and
assume their offices: Provided, The new city will
acquire a new corporate existence. The appointive
officials and employees of the City shall likewise
continues exercising their functions and duties and
they shall be automatically absorbed by the city
government of the City of Makati.
They contend that this section collides with section 8, Article X and
section 7, Article VI of the Constitution which provide:
Sec. 8. The term of office of elective local officials,
except barangay officials, which shall be determined
by law, shall be three years and no such official
shall serve for more than three consecutive terms.
Voluntary renunciation of the office for any length of
time shall not be considered as an interruption in the
continuity of his service for the full term for which he
was elected.
xxx xxx xxx
Sec. 7. The Members of the House of
Representatives shall be elected for a term of three
years which shall begin, unless otherwise provided
by law, at noon on the thirtieth day of June next
following their election.
No Member of the House of Representatives shall
serve for more than three consecutive terms.
Voluntary renunciation of the office for any length of
time shall not be considered as an interruption in the
continuity of his service for the full term for which he
was elected.
Petitioners stress that under these provisions, elective local officials,
including Members of the House of Representative, have a term of
three (3) years and are prohibited from serving for more than three (3)
consecutive terms. They argue that by providing that the new city shall
acquire a new corporate existence, section 51 of R.A. No. 7854 restarts
the term of the present municipal elective officials of Makati and
disregards the terms previously served by them. In particular,
petitioners point that section 51 favors the incumbent Makati Mayor,
respondent Jejomar Binay, who has already served for two (2)
consecutive terms. They further argue that should Mayor Binay decide
to run and eventually win as city mayor in the coming elections, he can
still run for the same position in 1998 and seek another three-year
consecutive term since his previous three-year consecutive term as
municipal mayor would not be counted. Thus, petitioners conclude that
said section 51 has been conveniently crafted to suit the political
ambitions of respondent Mayor Binay.
We cannot entertain this challenge to the constitutionality of section 51.
The requirements before a litigant can challenge the constitutionality of
a law are well delineated. They are: 1) there must be an actual case or
controversy; (2) the question of constitutionality must be raised by the
proper party; (3) the constitutional question must be raised at the
earliest possible opportunity; and (4) the decision on the constitutional
question must be necessary to the determination of the case itself.5
Petitioners have far from complied with these requirements. The
petition is premised on the occurrence of many contingent events, i.e.,
that Mayor Binay will run again in this coming mayoralty elections; that
he would be re-elected in said elections; and that he would seek re-
election for the same position in the 1998 elections. Considering that
these contingencies may or may not happen, petitioners merely pose a
hypothetical issue which has yet to ripen to an actual case or
controversy. Petitioners who are residents of Taguig (except Mariano)
are not also the proper parties to raise this abstract issue. Worse, they
hoist this futuristic issue in a petition for declaratory relief over which
this Court has no jurisdiction.
III
Finally, petitioners in the two (2) cases at bench assail the
constitutionality of section 52, Article X of R.A. No. 7854. Section 52 of
the Charter provides:
Sec. 52. Legislative Districts. — Upon its conversion
into a highly-urbanized city, Makati shall thereafter
have at least two (2) legislative districts that shall
initially correspond to the two (2) existing districts
created under Section 3(a) of Republic Act. No.
7166 as implemented by the Commission on
Elections to commence at the next national elections
to be held after the effectivity of this Act. Henceforth,
barangays Magallanes, Dasmariñas and Forbes
shall be with the first district, in lieu of Barangay
Guadalupe-Viejo which shall form part of the second
district. (emphasis supplied)
They contend. that the addition of another legislative district in Makati is
unconstitutional for: (1) reapportionment6 cannot made by a special
law, (2) the addition of a legislative district is not expressed in the title of
the bill7 and (3) Makati's population, as per the 1990 census, stands at
only four hundred fifty thousand (450,000).
These issues have been laid to rest in the recent case of Tobias v.
Abalos.8 In said case, we ruled that reapportionment of legislative
districts may be made through a special law, such as in the charter of a
new city. The Constitution9 clearly provides that Congress shall be
composed of not more than two hundred fifty (250) members, unless
otherwise fixed by law. As thus worded, the Constitution did not
preclude Congress from increasing its membership by passing a law,
other than a general reapportionment of the law. This is its exactly what
was done by Congress in enacting R.A. No. 7854 and providing for an
increase in Makati's legislative district. Moreover, to hold that
reapportionment can only be made through a general apportionment
law, with a review of all the legislative districts allotted to each local
government unit nationwide, would create an inequitable situation
where a new city or province created by Congress will be denied
legislative representation for an indeterminate period of time. 10 The
intolerable situations will deprive the people of a new city or province a
particle of their sovereignty. 11 Sovereignty cannot admit of any kind of
subtraction. It is indivisible. It must be forever whole or it is not
sovereignty.
Petitioners cannot insist that the addition of another legislative district in
Makati is not in accord with section 5(3), Article VI 12 of the
Constitution for as of the latest survey (1990 census), the population of
Makati stands at only four hundred fifty thousand (450,000). 13 Said
section provides, inter alia, that a city with a population of at least two
hundred fifty thousand (250,000) shall have at least one representative.
Even granting that the population of Makati as of the 1990 census
stood at four hundred fifty thousand (450,000), its legislative district
may still be increased since it has met the minimum population
requirement of two hundred fifty thousand (250,000). In fact, section 3
of the Ordinance appended to the Constitution provides that a city
whose population has increased to more than two hundred fifty
thousand (250,000) shall be entitled to at least one congressional
representative. 14
Finally, we do not find merit in petitioners' contention that the creation of
an additional legislative district in Makati should have been expressly
stated in the title of the bill. In the same case of Tobias v. Abalos, op
cit., we reiterated the policy of the Court favoring a liberal construction
of the "one title-one subject" rule so as not to impede legislation. To be
sure, with Constitution does not command that the title of a law should
exactly mirror, fully index, or completely catalogue all its details. Hence,
we ruled that "it should be sufficient compliance if the title expresses
the general subject and all the provisions are germane to such general
subject."
WHEREFORE, the petitions are hereby DISMISSED for lack of merit
No costs.
SO ORDERED.
Separate Opinions
 
DAVIDE, JR., J., concurring:
I concur in the well written opinion of Mr. Justice Reynato S. Puno. I
wish, however, to add a few observations.
I.
Section 10, Article X of the Constitution provides that "[n]o province,
city, municipality or barangay may be created, divided, merged,
abolished, or its boundary substantially altered, except in accordance
with the criteria established in the local government code and subject to
the approval by a majority of the votes cast in a plebiscite in the political
units directly affected." These criteria are now set forth in Section 7 of
the Local Government Code of 1991 (R.A. No. 7160). One of these is
that the territorial jurisdiction of the local government unit to be created
or converted should be properly identified by metes and bounds with
technical descriptions.
The omission of R.A. No. 7854 (An Act Converting the Municipality of
Makati Into a Highly Urbanized City to be Known as the City of Makati)
to describe the territorial boundaries of the city by metes and bounds
does not make R.A. No. 7854 unconstitutional or illegal. The
Constitution does not provide for a description by metes and bounds as
a condition sine qua non for the creation of a local government unit or
its conversion from one level to another. The criteria provided for in
Section 7 of R.A. No. 7854 are not absolute, for, as a matter of fact, the
section starts with the clause "as a general rule." The petitioners'
reliance on Section 450 of R.A. No. 7160 is unavailing Said section only
applies to the conversion of a municipality or a cluster of barangays into
a COMPONENT CITY, not a highly urbanized city. It pertinently reads
as follows:
Sec. 450. Requisite for creation. — (a) A
municipality or a cluster of barangays may be
converted into a component city if it has an average
annual income, as certified by the Department of
Finance, of at least Twenty million pesos
(P20,000,000.00) for the last two (2) consecutive
years based on 1991 constant prices, and if it has
either of the following requisites:
xxx xxx xxx
(b) The territorial jurisdiction of a newly created city
shall be properly identified by metes and
bounds. . . .
The constitution classifies cities as either highly urbanized or
component. Section 12 of Article X thereof provides:
Sec. 12. Cities that are highly urbanized, as
determined by law, and component cities whose
charters prohibit their voters from voting for
provincial elective officials, shall be independent of
the province. The voters of component cities within a
province, whose charters contain no such
prohibition, shall not be deprived of their right to vote
for elective provincial officials.
And Section 451 of R.A. No. 7160 provides:
Sec. 451. Cities Classified. — A city may either be
component or highly urbanized: Provided, however,
That the criteria established in this Code shall not
affect the classification and corporate status of
existing cities.
Independent component cities are those component
cities whose charters prohibit their voters from
voting for provincial elective officials. Independent
component cities shall be independent of the
province.
II.
Strictly speaking, the increase in the number of legislative seats for the
City of Makati provided for in R.A. No. 7854 is not an increase justified
by the clause unless otherwise fixed by law in paragraph 1, Section 5,
Article VI of the Constitution. That clause contemplates of the
reapportionment mentioned in the succeeding paragraph (4) of the said
Section which reads in full as follows:
Within three years following the return of every
census, the Congress shall make a reapportionment
of legislative districts based on the standards
provided in this section.
In short, the clause refers to a general reapportionment law.
The increase under R.A. No. 7854 is a permissible increase under
Sections 1 and 3 of the Ordinance appended to the Constitution which
reads:
Sec. 1. For purposes of the election of Members of
the House of Representatives of the First Congress
of the Philippines under the Constitution proposed
by the 1986 Constitutional Commission and
subsequent elections, and until otherwise provided
by law, the Members thereof shall be elected from
legislative districts apportioned among the
provinces, cities, and the Metropolitan Manila Area
as follows:
METROPOLITAN MANILA AREA
xxx xxx xxx
MAKATI one (1)
xxx xxx xxx
Sec. 3. Any province that may hereafter be created,
or any city whose population may hereafter increase
to more than two hundred fifty thousand shall be
entitled in the immediately following election to at
least one Member or such number of Members as it
may be entitled to on the basis of the number of its
inhabitants and according to the standards set forth
in paragraph (3), Section 5 of Article VI of the
Constitution. The number of Members apportioned
to the province out of which such new province was
created, or where the city, whose population has so
increased, is geographically located shall be
correspondingly adjusted by the Commission on
Elections but such adjustment shall not be made
within one hundred and twenty days before the
election. (Emphases supplied) 
Separate Opinions
DAVIDE, JR., J., concurring:
I concur in the well written opinion of Mr. Justice Reynato S. Puno. I
wish, however, to add a few observations.
I.
Section 10, Article X of the Constitution provides that "[n]o province,
city, municipality or barangay may be created, divided, merged,
abolished, or its boundary substantially altered, except in accordance
with the criteria established in the local government code and subject to
the approval by a majority of the votes cast in a plebiscite in the political
units directly affected." These criteria are now set forth in Section 7 of
the Local Government Code of 1991 (R.A. No. 7160). One of these is
that the territorial jurisdiction of the local government unit to be created
or converted should be properly identified by metes and bounds with
technical descriptions.
The omission of R.A. No. 7854 (An Act Converting the Municipality of
Makati Into a Highly Urbanized City to be Known as the City of Makati)
to describe the territorial boundaries of the city by metes and bounds
does not make R.A. No. 7854 unconstitutional or illegal. The
Constitution does not provide for a description by metes and bounds as
a condition sine qua non for the creation of a local government unit or
its conversion from one level to another. The criteria provided for in
Section 7 of R.A. No. 7854 are not absolute, for, as a matter of fact, the
section starts with the clause "as a general rule." The petitioners'
reliance on Section 450 of R.A. No. 7160 is unavailing Said section only
applies to the conversion of a municipality or a cluster of barangays into
a COMPONENT CITY, not a highly urbanized city. It pertinently reads
as follows:
Sec. 450. Requisite for creation. — (a) A
municipality or a cluster of barangays may be
converted into a component city if it has an average
annual income, as certified by the Department of
Finance, of at least Twenty million pesos
(P20,000,000.00) for the last two (2) consecutive
years based on 1991 constant prices, and if it has
either of the following requisites:
xxx xxx xxx
(b) The territorial jurisdiction of a newly created city
shall be properly identified by metes and
bounds. . . .
The constitution classifies cities as either highly urbanized or
component. Section 12 of Article X thereof provides:
Sec. 12. Cities that are highly urbanized, as
determined by law, and component cities whose
charters prohibit their voters from voting for
provincial elective officials, shall be independent of
the province. The voters of component cities within a
province, whose charters contain no such
prohibition, shall not be deprived of their right to vote
for elective provincial officials.
And Section 451 of R.A. No. 7160 provides:
Sec. 451. Cities Classified. — A city may either be
component or highly urbanized: Provided, however,
That the criteria established in this Code shall not
affect the classification and corporate status of
existing cities.
Independent component cities are those component
cities whose charters prohibit their voters from
voting for provincial elective officials. Independent
component cities shall be independent of the
province.
II.
Strictly speaking, the increase in the number of legislative seats for the
City of Makati provided for in R.A. No. 7854 is not an increase justified
by the clause unless otherwise fixed by law in paragraph 1, Section 5,
Article VI of the Constitution. That clause contemplates of the
reapportionment mentioned in the succeeding paragraph (4) of the said
Section which reads in full as follows:
Within three years following the return of every
census, the Congress shall make a reapportionment
of legislative districts based on the standards
provided in this section.
In short, the clause refers to a general reapportionment law.
The increase under R.A. No. 7854 is a permissible increase under
Sections 1 and 3 of the Ordinance appended to the Constitution which
reads:
Sec. 1. For purposes of the election of Members of
the House of Representatives of the First Congress
of the Philippines under the Constitution proposed
by the 1986 Constitutional Commission and
subsequent elections, and until otherwise provided
by law, the Members thereof shall be elected from
legislative districts apportioned among the
provinces, cities, and the Metropolitan Manila Area
as follows:
METROPOLITAN MANILA AREA
xxx xxx xxx
MAKATI one (1)
xxx xxx xxx
Sec. 3. Any province that may hereafter be created,
or any city whose population may hereafter increase
to more than two hundred fifty thousand shall be
entitled in the immediately following election to at
least one Member or such number of Members as it
may be entitled to on the basis of the number of its
inhabitants and according to the standards set forth
in paragraph (3), Section 5 of Article VI of the
Constitution. The number of Members apportioned
to the province out of which such new province was
created, or where the city, whose population has so
increased, is geographically located shall be
correspondingly adjusted by the Commission on
Elections but such adjustment shall not be made
within one hundred and twenty days before the
election. (Emphases supplied)
G.R. No. 152295            July 9, 2002
ANTONIETTE V.C. MONTESCLAROS, MARICEL CARANZO,
JOSEPHINE ATANGAN, RONALD ATANGAN and CLARIZA
DECENA, and OTHER YOUTH OF THE LAND SIMILARLY
SITUATED, petitioners,
vs.
COMMISSION ON ELECTIONS, DEPARTMENT OF INTERIOR AND
LOCAL GOVERNMENT, DEPARTMENT OF BUDGET AND
MANAGEMENT, EXECUTIVE SECRETARY of the OFFICE OF THE
PRESIDENT, SENATOR FRANKLIN DRILON in his capacity as
Senate President and SENATOR AQUILINO PIMENTEL in his
capacity as Minority Leader of the Senate of the Philippines,
CONGRESSMAN JOSE DE VENECIA in his capacity as Speaker,
CONGRESSMAN AGUSTO L. SYJOCO in his capacity as Chairman
of the Committee on Suffrage and Electoral Reforms, and
CONGRESSMAN EMILIO C. MACIAS II in his capacity as Chairman
of the Committee on Local Government of the House of
Representatives, THE PRESIDENT OF THE PAMBANSANG
KATIPUNAN NG MGA SANGGUNIANG KABATAAN, AND ALL
THEIR AGENTS AND REPRESENTATIVES, respondents.
CARPIO, J.:
The Case
Before us is a petition for certiorari, prohibition and mandamus with
prayer for a temporary restraining order or preliminary injunction. The
petition seeks to prevent the postponement of the Sangguniang
Kabataan ("SK" for brevity) elections originally scheduled last May 6,
2002. The petition also seeks to prevent the reduction of the age
requirement for membership in the SK.
Petitioners, who are all 20 years old, filed this petition as a taxpayer's
and class suit, on their own behalf and on behalf of other youths
similarly situated. Petitioners claim that they are in danger of being
disqualified to vote and be voted for in the SK elections should the SK
elections on May 6, 2002 be postponed to a later date. Under the Local
Government Code of 1991 (R.A. No. 7160), membership in the SK is
limited to youths at least 15 but not more than 21 years old.
Petitioners allege that public respondents "connived, confederated and
conspired" to postpone the May 6, 2002 SK elections and to lower the
membership age in the SK to at least 15 but less than 18 years of age.
Petitioners assail the alleged conspiracy because youths at least 18 but
not more than 21 years old will be "summarily and unduly
dismembered, unfairly discriminated, unnecessarily disenfranchised,
unjustly disassociated and obnoxiously disqualified from the SK
organization."1
Thus, petitioners pray for the issuance of a temporary restraining order
or preliminary injunction -
"a) To prevent, annul or declare unconstitutional any law,
decree, Comelec resolution/directive and other respondents'
issuances, orders and actions and the like in postponing the
May 6, 2002 SK elections.
b) To command the respondents to continue the May 6, 2002
SK elections set by the present law and in accordance with
Comelec Resolutions No. 4713 and 4714 and to expedite the
funding of the SK elections.
c) In the alternative, if the SK elections will be postponed for
whatever reason, there must be a definite date for said
elections, for example, July 15, 2002, and the present SK
membership, except those incumbent SK officers who were
elected on May 6, 1996, shall be allowed to run for any SK
elective position even if they are more than 21 years old.
d) To direct the incumbent SK officers who are presently
representing the SK in every sanggunian and the NYC to
vacate their post after the barangay elections." 2
The Facts
The SK is a youth organization originally established by Presidential
Decree No. 684 as the Kabataang Barangay ("KB" for brevity). The KB
was composed of all barangay residents who were less than 18 years
old, without specifying the minimum age. The KB was organized to
provide its members with the opportunity to express their views and
opinions on issues of transcendental importance.3
The Local Government Code of 1991 renamed the KB to SK and
limited SK membership to those youths "at least 15 but not more than
21 years of age."4 The SK remains as a youth organization in every
barangay tasked to initiate programs "to enhance the social, political,
economic, cultural, intellectual, moral, spiritual, and physical
development of the youth."5 The SK in every barangay is composed of
a chairperson and seven members, all elected by the Katipunan ng
Kabataan. The Katipunan ng Kabataan in every barangay is composed
of all citizens actually residing in the barangay for at least six months
and who meet the membership age requirement.
The first SK elections took place on December 4, 1992. RA No. 7808
reset the SK elections to the first Monday of May of 1996 and every
three years thereafter. RA No. 7808 mandated the Comelec to
supervise the conduct of the SK elections under rules the Comelec
shall promulgate. Accordingly, the Comelec on December 4, 2001
issued Resolution Nos. 47136 and 47147 to govern the SK elections on
May 6, 2002.
On February 18, 2002, petitioner Antoniette V.C. Montesclaros
("Montesclaros" for brevity) sent a letter 8 to the Comelec, demanding
that the SK elections be held as scheduled on May 6, 2002.
Montesclaros also urged the Comelec to respond to her letter within 10
days upon receipt of the letter, otherwise, she will seek judicial relief.
On February 20, 2002, Alfredo L. Benipayo ("Chairman Benipayo" for
brevity), then Comelec Chairman, wrote identical letters to the Speaker
of the House9 and the Senate President10 about the status of pending
bills on the SK and Barangay elections. In his letters, the Comelec
Chairman intimated that it was "operationally very difficult" to hold both
elections simultaneously in May 2002. Instead, the Comelec Chairman
expressed support for the bill of Senator Franklin Drilon that proposed
to hold the Barangay elections in May 2002 and postpone the SK
elections to November 2002.
Ten days lapsed without the Comelec responding to the letter of
Montesclaros. Subsequently, petitioners received a copy of Comelec
En Banc Resolution No. 476311 dated February 5, 2002 recommending
to Congress the postponement of the SK elections to November 2002
but holding the Barangay elections in May 2002 as scheduled.12
On March 6, 2002, the Senate and the House of Representatives
passed their respective bills postponing the SK elections. On March 11,
2002, the Bicameral Conference Committee ("Bicameral Committee"
for brevity) of the Senate and the House came out with a Report 13
recommending approval of the reconciled bill consolidating Senate Bill
No. 205014 and House Bill No. 4456.15 The Bicameral Committee's
consolidated bill reset the SK and Barangay elections to July 15, 2002
and lowered the membership age in the SK to at least 15 but not more
than 18 years of age.
On March 11, 2002, petitioners filed the instant petition.
On March 11, 2002, the Senate approved the Bicameral Committee's
consolidated bill and on March 13, 2002, the House of Representatives
approved the same. The President signed the approved bill into law on
March 19, 2002.
The Issues
Petitioners16 raise the following grounds in support of their petition:
"I.
RESPONDENTS ACTED WHIMSICALLY, ILLEGALLY AND
UNCONSTITUTIONALLY THUS CONSTITUTED (SIC) WITH
GRAVE ABUSE OF DISCRETION, AMOUNTING TO LACK
OR EXCESS OF JURISDICTION WHEN THEY INTENDED
TO POSTPONE THE SK ELECTIONS.
II.
RESPONDENTS ACTED WHIMSICALLY, ILLEGALLY AND
UNCONSTITUTIONALLY THUS CONSTITUTED (SIC) WITH
GRAVE ABUSE OF DISCRETION, AMOUNTING TO LACK
OR EXCESS OF JURISDICTION WHEN THEY INTENDED
TO DISCRIMINATE, DISENFRANCHISE, SINGLE OUT AND
DISMEMBER THE SK MEMBERS WHO ARE 18 BUT NOT
LESS17 (SIC) THAN 21 YEARS OLD COMPOSED OF
ABOUT 7 MILLION YOUTH.
III.
RESPONDENTS ACTED WHIMSICALLY, ILLEGALLY AND
UNCONSTITUTIONALLY THUS CONSTITUTED (SIC) WITH
GRAVE ABUSE OF DISCRETION, AMOUNTING TO LACK
OR EXCESS OF JURISDICTION WHEN THEY WILLFULLY
FAILED TO FUND THE SK ELECTION PURPORTEDLY TO
POSTPONE THE SAME IN ORDER TO IMPLEMENT THEIR
ILLEGAL SCHEME AND MACHINATION IN SPITE OF THE
FACT THAT THERE ARE AVAILABLE FUNDS FOR THE
PURPOSE.
IV.
THE INCUMBENT SK OFFICERS WANTED TO
PERPETUALLY SIT ON THEIR RESPECTIVE OFFICES
CONTRARY TO THE ENVISION (SIC) OF THE CREATION
OF THE SK ORGANIZATION, HENCE, IN VIOLATION OF
LAW AND CONSTITUTION."18
The Court's Ruling
The petition is bereft of merit.
At the outset, the Court takes judicial notice of the following events that
have transpired since petitioners filed this petition:
1. The May 6, 2002 SK elections and May 13, 2002 Barangay
elections were not held as scheduled.
2. Congress enacted RA No. 9164 19 which provides that
voters and candidates for the SK elections must be "at least
15 but less than 18 years of age on the day of the election." 20
RA No. 9164 also provides that there shall be a synchronized
SK and Barangay elections on July 15, 2002.
 3. The Comelec promulgated Resolution No. 4846, the rules
and regulations for the conduct of the July 15, 2002
synchronized SK and Barangay elections.
Petitioners, who all claim to be 20 years old, argue that the
postponement of the May 6, 2002 SK elections disenfranchises them,
preventing them from voting and being voted for in the SK elections.
Petitioners' theory is that if the SK elections were postponed to a date
later than May 6, 2002, the postponement would disqualify from SK
membership youths who will turn 21 years old between May 6, 2002
and the date of the new SK elections. Petitioners claim that a reduction
in the SK membership age to 15 but less than 18 years of age from the
then membership age of 15 but not more than 21 years of age would
disqualify about seven million youths. The public respondents' failure to
hold the elections on May 6, 2002 would prejudice petitioners and other
youths similarly situated.
Thus, petitioners instituted this petition to: (1) compel public
respondents to hold the SK elections on May 6, 2002 and should it be
postponed, the SK elections should be held not later than July 15,
2002; (2) prevent public respondents from passing laws and issuing
resolutions and orders that would lower the membership age in the SK;
and (3) compel public respondents to allow petitioners and those who
have turned more than 21 years old on May 6, 2002 to participate in
any re-scheduled SK elections.
The Court's power of judicial review may be exercised in constitutional
cases only if all the following requisites are complied with, namely: (1)
the existence of an actual and appropriate case or controversy; (2) a
personal and substantial interest of the party raising the constitutional
question; (3) the exercise of judicial review is pleaded at the earliest
opportunity; and (4) the constitutional question is the lis mota of the
case.21
In the instant case, there is no actual controversy requiring the exercise
of the power of judicial review. While seeking to prevent a
postponement of the May 6, 2002 SK elections, petitioners are
nevertheless amenable to a resetting of the SK elections to any date
not later than July 15, 2002. RA No. 9164 has reset the SK elections to
July 15, 2002, a date acceptable to petitioners. With respect to the date
of the SK elections, there is therefore no actual controversy requiring
judicial intervention.
Petitioners' prayer to prevent Congress from enacting into law a
proposed bill lowering the membership age in the SK does not present
an actual justiciable controversy. A proposed bill is not subject to
judicial review because it is not a law. A proposed bill creates no right
and imposes no duty legally enforceable by the Court. A proposed bill,
having no legal effect, violates no constitutional right or duty. The Court
has no power to declare a proposed bill constitutional or
unconstitutional because that would be in the nature of rendering an
advisory opinion on a proposed act of Congress. The power of judicial
review cannot be exercised in vacuo.22 The second paragraph of
Section 1, Article VIII of the Constitution states –
"Judicial power includes the duty of the courts of justice to
settle actual controversies involving rights which are
legally demandable and enforceable, and to determine
whether or not there has been a grave abuse of discretion
amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of the Government." (Emphasis
supplied)
Thus, there can be no justiciable controversy involving the
constitutionality of a proposed bill. The Court can exercise its power of
judicial review only after a law is enacted, not before.
Under the separation of powers, the Court cannot restrain Congress
from passing any law, or from setting into motion the legislative mill
according to its internal rules. Thus, the following acts of Congress in
the exercise of its legislative powers are not subject to judicial restraint:
the filing of bills by members of Congress, the approval of bills by each
chamber of Congress, the reconciliation by the Bicameral Committee of
approved bills, and the eventual approval into law of the reconciled bills
by each chamber of Congress. Absent a clear violation of specific
constitutional limitations or of constitutional rights of private parties, the
Court cannot exercise its power of judicial review over the internal
processes or procedures of Congress.23
The Court has also no power to dictate to Congress the object or
subject of bills that Congress should enact into law. The judicial power
to review the constitutionality of laws does not include the power to
prescribe to Congress what laws to enact. The Court has no power to
compel Congress by mandamus to enact a law allowing petitioners,
regardless of their age, to vote and be voted for in the July 15, 2002 SK
elections. To do so would destroy the delicate system of checks and
balances finely crafted by the Constitution for the three co-equal,
coordinate and independent branches of government.
Under RA No. 9164, Congress merely restored the age requirement in
PD No. 684, the original charter of the SK, which fixed the maximum
age for membership in the SK to youths less than 18 years old.
Petitioners do not have a vested right to the permanence of the age
requirement under Section 424 of the Local Government Code of 1991.
Every law passed by Congress is always subject to amendment or
repeal by Congress. The Court cannot restrain Congress from
amending or repealing laws, for the power to make laws includes the
power to change the laws.24
The Court cannot also direct the Comelec to allow over-aged voters to
vote or be voted for in an election that is limited under RA No. 9164 to
youths at least 15 but less than 18 years old. A law is needed to allow
all those who have turned more than 21 years old on or after May 6,
2002 to participate in the July 15, 2002 SK elections. Youths from 18 to
21 years old as of May 6, 2002 are also no longer SK members, and
cannot participate in the July 15, 2002 SK elections. Congress will have
to decide whether to enact an amendatory law. Petitioners' remedy is
legislation, not judicial intervention.
Petitioners have no personal and substantial interest in maintaining this
suit. A party must show that he has been, or is about to be denied
some personal right or privilege to which he is lawfully entitled. 25 A party
must also show that he has a real interest in the suit. By "real interest"
is meant a present substantial interest, as distinguished from a mere
expectancy or future, contingent, subordinate, or inconsequential
interest.26
In the instant case, petitioners seek to enforce a right originally
conferred by law on those who were at least 15 but not more than 21
years old. Now, with the passage of RA No. 9164, this right is limited to
those who on the date of the SK elections are at least 15 but less than
18 years old. The new law restricts membership in the SK to this
specific age group. Not falling within this classification, petitioners have
ceased to be members of the SK and are no longer qualified to
participate in the July 15, 2002 SK elections. Plainly, petitioners no
longer have a personal and substantial interest in the SK elections.
This petition does not raise any constitutional issue. At the time
petitioners filed this petition, RA No. 9164, which reset the SK elections
and reduced the age requirement for SK membership, was not yet
enacted into law. After the passage of RA No. 9164, petitioners failed to
assail any provision in RA No. 9164 that could be unconstitutional. To
grant petitioners' prayer to be allowed to vote and be voted for in the
July 15, 2002 SK elections necessitates assailing the constitutionality of
RA No. 9164. This, petitioners have not done. The Court will not strike
down a law unless its constitutionality is properly raised in an
appropriate action and adequately argued.27
The only semblance of a constitutional issue, albeit erroneous, that
petitioners raise is their claim that SK membership is a "property right
within the meaning of the Constitution." 28 Since certain public offices
are "reserved" for SK officers, petitioners also claim a constitutionally
protected "opportunity" to occupy these public offices. In petitioners'
own words, they and others similarly situated stand to "lose their
opportunity to work in the government positions reserved for SK
members or officers."29 Under the Local Government Code of 1991, the
president of the federation of SK organizations in a municipality, city or
province is an ex-officio member of the municipal council, city council or
provincial board, respectively.30 The chairperson of the SK in the
barangay is an ex-officio member of the Sangguniang Barangay. 31 The
president of the national federation of SK organizations is an ex-officio
member of the National Youth Commission, with rank of a Department
Assistant Secretary.32
Congress exercises the power to prescribe the qualifications for SK
membership. One who is no longer qualified because of an amendment
in the law cannot complain of being deprived of a proprietary right to SK
membership. Only those who qualify as SK members can contest,
based on a statutory right, any act disqualifying them from SK
membership or from voting in the SK elections. SK membership is not a
property right protected by the Constitution because it is a mere
statutory right conferred by law. Congress may amend at any time the
law to change or even withdraw the statutory right.
A public office is not a property right. As the Constitution expressly
states, a "[P]ublic office is a public trust."33 No one has a vested right to
any public office, much less a vested right to an expectancy of holding
a public office. In Cornejo v. Gabriel,34 decided in 1920, the Court
already ruled:
"Again, for this petition to come under the due process of law
prohibition, it would be necessary to consider an office a
"property." It is, however, well settled x x x that a public
office is not property within the sense of the
constitutional guaranties of due process of law, but is a
public trust or agency. x x x The basic idea of the government
x x x is that of a popular representative government, the
officers being mere agents and not rulers of the people, one
where no one man or set of men has a proprietary or
contractual right to an office, but where every officer accepts
office pursuant to the provisions of the law and holds the
office as a trust for the people he represents." (Emphasis
supplied)
Petitioners, who apparently desire to hold public office, should realize
from the very start that no one has a proprietary right to public office.
While the law makes an SK officer an ex-officio member of a local
government legislative council, the law does not confer on petitioners a
proprietary right or even a proprietary expectancy to sit in local
legislative councils. The constitutional principle of a public office as a
public trust precludes any proprietary claim to public office. Even the
State policy directing "equal access to opportunities for public service" 35
cannot bestow on petitioners a proprietary right to SK membership or a
proprietary expectancy to ex-officio public offices.
Moreover, while the State policy is to encourage the youth's
involvement in public affairs, 36 this policy refers to those who belong to
the class of people defined as the youth. Congress has the power to
define who are the youth qualified to join the SK, which itself is a
creation of Congress. Those who do not qualify because they are past
the age group defined as the youth cannot insist on being part of the
youth. In government service, once an employee reaches mandatory
retirement age, he cannot invoke any property right to cling to his office.
In the same manner, since petitioners are now past the maximum age
for membership in the SK, they cannot invoke any property right to cling
to their SK membership.
The petition must also fail because no grave abuse of discretion
attended the postponement of the SK elections. RA No. 9164 is now
the law that prescribes the qualifications of candidates and voters for
the SK elections. This law also fixes the date of the SK elections.
Petitioners are not even assailing the constitutionality of RA No. 9164.
RA No. 9164 enjoys the presumption of constitutionality and will apply
to the July 15, 2002 SK elections.
Petitioners have not shown that the Comelec acted illegally or with
grave abuse of discretion in recommending to Congress the
postponement of the SK elections. The very evidence relied upon by
petitioners contradict their allegation of illegality. The evidence consist
of the following: (1) Comelec en banc Resolution No. 4763 dated
February 5, 2002 that recommended the postponement of the SK
elections to 2003; (2) the letter of then Comelec Chairman Benipayo
addressed to the Speaker of the House of Representatives and the
President of the Senate; and (3) the Conference Committee Report
consolidating Senate Bill No. 2050 and House Bill No. 4456.
The Comelec exercised its power and duty to "enforce and administer
all laws and regulations relative to the conduct of an election, plebiscite,
initiative, referendum and recall"37 and to "recommend to Congress
effective measures to minimize election spending." 38 The Comelec's
acts enjoy the presumption of regularity in the performance of official
duties.39 These acts cannot constitute proof, as claimed by petitioners,
that there "exists a connivance and conspiracy (among) respondents in
contravention of the present law." As the Court held in Pangkat Laguna
v. Comelec,40 the "Comelec, as the government agency tasked with the
enforcement and administration of elections laws, is entitled to the
presumption of regularity of official acts with respect to the elections."
The 1987 Constitution imposes upon the Comelec the duty of enforcing
and administering all laws and regulations relative to the conduct of
elections. Petitioners failed to prove that the Comelec committed grave
abuse of discretion in recommending to Congress the postponement of
the May 6, 2002 SK elections. The evidence cited by petitioners even
establish that the Comelec has demonstrated an earnest effort to
address the practical problems in holding the SK elections on May 6,
2002. The presumption remains that the decision of the Comelec to
recommend to Congress the postponement of the elections was made
in good faith in the regular course of its official duties.
Grave abuse of discretion is such capricious and whimsical exercise of
judgment that is patent and gross as to amount to an evasion of a
positive duty or a virtual refusal to perform a duty enjoined by law. 41
Public respondents having acted strictly pursuant to their constitutional
powers and duties, we find no grave abuse of discretion in their
assailed acts.
Petitioners contend that the postponement of the SK elections would
allow the incumbent SK officers to perpetuate themselves in power,
depriving other youths of the opportunity to serve in elective SK
positions. This argument deserves scant consideration. While RA No.
9164 contains a hold-over provision, incumbent SK officials can remain
in office only until their successors have been elected or qualified. On
July 15, 2002, when the SK elections are held, the hold-over period
expires and all incumbent SK officials automatically cease to hold their
SK offices and their ex-officio public offices.
In sum, petitioners have no personal and substantial interest in
maintaining this suit. This petition presents no actual justiciable
controversy. Petitioners do not cite any provision of law that is alleged
to be unconstitutional. Lastly, we find no grave abuse of discretion on
the part of public respondents.
WHEREFORE, the petition is DISMISSED for utter lack of merit.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Puno, Vitug, Kapunan, Mendoza,
Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez,
Austria-Martinez, and Corona, JJ., concur.
G.R. No. 93100 June 19, 1997 Petitioners also claim that Administrative Order Nos. 8 and 10 issued
ATLAS FERTILIZER CORPORATION, petitioner, by the Secretary of the Department of Agrarian Reform are, likewise,
vs. unconstitutional, as held in "Luz Farms," and are therefore void as they
THE HONORABLE SECRETARY OF THE DEPARTMENT OF implement the assailed provisions of CARL.
AGRARIAN REFORM, respondent. The provisions of CARL being assailed as unconstitutional are as
G.R. No. 97855 June 19, 1997 follows:
PHILIPPINE FEDERATION OF FISHFARM PRODUCERS, INC. (a) Section 3 (b) which includes the "raising of fish in
petitioner, the definition of "Agricultural, Agricultural Enterprise
vs. or Agricultural Activity." (Emphasis Supplied)
THE HONORABLE SECRETARY OF THE DEPARTMENT OF (b) Section 11 which defines "commercial farms" as
AGRARIAN REFORM, respondent. private agricultural lands devoted to fishponds and
RESOLUTION prawn ponds. . . . (Emphasis Supplied)
(c) Section 13 which calls upon petitioner to execute
a production-sharing plan.
ROMERO, J.:
(d) Section 16(d) and 17 which vest on the
Before this Court are consolidated petitions questioning the
Department of Agrarian reform the authority to
constitutionality of some portions of Republic Act No. 6657 otherwise
summarily determine the just compensation to be
known as the Comprehensive Agrarian Reform Law. 1
paid for lands covered by the comprehensive
Petitioners Atlas Fertilizer Corporation, 2 Philippine Federation of Agrarian reform Law.
Fishfarm Producers, Inc. and petitioner-in-intervention Archie's
(e) Section 32 which spells out the production-
Fishpond, Inc. and Arsenio Al. Acuna 3 are engaged in the aquaculture
sharing plan mentioned in section 13 —
industry utilizing fishponds and prawn farms. They assail Sections 3 (b),
11, 13, 16 (d), 17 and 32 of R.A. 6657, as well as the implementing . . . (W)hereby three percent (3%) of the gross sales
guidelines and procedures contained in Administrative Order Nos. 8 from the production of such lands are distributed
and 10 Series of 1988 issued by public respondent Secretary of the within sixty (60) days at the end of the fiscal year as
Department of Agrarian Reform as unconstitutional. compensation to regular and other farmworkers in
such lands over and above the compensation they
Petitioners claim that the questioned provisions of CARL violate the
currently receive: Provided, That these individuals or
Constitution in the following manner:
entities realize gross sales in excess of five million
1. Sections 3 (b), 11, 13, 16 (d), 17 and 32 of CARL pesos per annum unless the DAR, upon proper
extend agrarian reform to aquaculture lands even as application, determines a lower ceiling.
Section 4, Article XIII of the Constitution limits
In the event that the individual or entity realizes a
agrarian reform only to agricultural lands.
profit, an additional ten percent (10%) of the net
2. The questioned provisions similarly treat of profit after tax shall be distributed to said regular and
aquaculture lands and agriculture lands when they other farmworkers within ninety (90) days of the end
are differently situated, and differently treat of the fiscal year. . . .
aquaculture lands and other industrial lands, when
While the Court will not hesitate to declare a law or an act void when
they are similarly situated in violation of the
confronted squarely with constitutional issues, neither will it preempt the
constitutional guarantee of the equal protection of
Legislative and the Executive branches of the government in correcting
the laws.
or clarifying, by means of amendment, said law or act. On February 20,
3. The questioned provisions distort employment 1995, Republic Act No. 7881 6 was approved by Congress. Provisions
benefits and burdens in favor of aquaculture of said Act pertinent to the assailed provisions of CARL are the
employees and against other industrial workers following:
even as Section 1 and 3, Article XIII of the
Sec. 1. Section 3, Paragraph (b) of Republic Act No.
Constitution mandate the State to promote equality
6657 is hereby amended to read as follows:
in economic and employment opportunities.
Sec. 3. Definitions. — For the
4. The questioned provisions deprive petitioner of its
purpose of this Act, unless the
government-induced investments in aquaculture
context indicates otherwise:
even as Sections 2 and 3, Article XIII of the
Constitution mandate the State to respect the (b) Agriculture, Agricultural
freedom of enterprise and the right of enterprises to Enterprise or Agricultural Activity
reasonable returns on investments and to expansion means the cultivation of the soil,
and growth. planting of crops, growing of fruit
trees, including the harvesting of
The constitutionality of the above-mentioned provisions has been ruled
such farm products and other
upon in the case of Luz Farms, Inc. v. Secretary of Agrarian Reform 4
farm activities and practices
regarding the inclusion of land devoted to the raising of livestock,
performed by a farmer in
poultry and swine in its coverage.
conjunction with such farming
The issue now before this Court is the constitutionality of the same operations done by persons
above-mentioned provisions insofar as they include in its coverage whether natural or juridical.
lands devoted to the aquaculture industry, particularly fishponds and
Sec. 2. Section 10 of Republic Act No. 6657 is
prawn farms.
hereby amended to read as follows:
In their first argument , petitioners contend that in the case of Luz
Sec. 10. Exemptions and
Farms, Inc. v. Secretary of Agrarian Reform, 5 this Court has already
Exclusions. —
ruled impliedly that lands devoted to fishing are not agricultural lands. In
aquaculture, fishponds and prawn farms, the use of land is only xxx xxx xxx
incidental to and not the principal factor in productivity and, hence, as b) Private lands actually, directly
held in "Luz Farms," they too should be excluded from R.A. 6657 just and exclusively used for prawn
as lands devoted to livestock, swine, and poultry have been excluded farms and fishponds shall be
for the same reason. They also argue that they are entitled to the full exempt from the coverage of this
benefit of "Luz Farms" to the effect that only five percent of the total Act: Provided, That said prawn
investment in aquaculture activities, fishponds, and prawn farms, is in farms and fishponds have not
the form of land, and therefore, cannot be classified as agricultural been distributed and Certificate
activity. Further, that in fishponds and prawn farms, there are no of Land Ownership Award
farmers, nor farm workers, who till lands, and no agrarian unrest, and (CLOA) issued to agrarian reform
therefore, the constitutionally intended beneficiaries under Section 4, beneficiaries under the
Art. XIII, 1987 Constitution do not exist in aquaculture. Comprehensive Agrarian Reform
In their second argument, they contend that R.A. 6657, by including in Program.
its coverage, the raising of fish and aquaculture operations including In cases where the fishponds or
fishponds and prawn ponds, treating them as in the same class or prawn farms have been
classification as agriculture or farming violates the equal protection subjected to the Comprehensive
clause of the Constitution and is, therefore, void. Further, the Agrarian Reform Law, by
Constitutional Commission debates show that the intent of the voluntary offer to sell, or
constitutional framers is to exclude "industrial" lands, to which category commercial farms deferment or
lands devoted to aquaculture, fishponds, and fish farms belong. notices of compulsory
acquisition, a simple and
 absolute majority of the actual provided the size of the land
regular workers or tenants must converted does not exceed the
consent to the exemption within retention limit of the landowner.
one (1) year from the effectivity The above-mentioned provisions of R.A. No. 7881 expressly state that
of this Act. when the workers or fishponds and prawn farms are excluded from the coverage of CARL.
tenants do not agree to this In view of the foregoing, the question concerning the constitutionality of
exemption, the fishponds or the assailed provisions has become moot and academic with the
prawn farms shall be distributed passage of R.A. No. 7881.
collectively to the worker —
WHEREFORE, the petition is hereby DISMISSED.
beneficiaries or tenants who shall
form a cooperative or association SO ORDERED.
to manage the same.
In cases where the fishponds or
prawn farms have not been
subjected to the Comprehensive
Agrarian Reform Law, the
consent of the farm workers shall
no longer be necessary,
however, the provision of Section
32-A hereof on incentives shall
apply.
xxx xxx xxx
Sec. 3. Section 11, Paragraph 1 is hereby amended
to read as follows:
Sec. 11. Commercial Farming. —
Commercial farms, which are
private agricultural lands devoted
to saltbeds, fruit farms, orchards,
vegetable and cut-flower farms
and cacao, coffee and rubber
plantations, shall be subject to
immediate compulsory
acquisition and distribution after
ten (10) years from the effectivity
of this Act. In the case of new
farms, the ten-year period shall
begin from the first year of
commercial production and
operation, as determined by the
DAR. During the ten-year period,
the Government shall initiate
steps necessary to acquire these
lands, upon payment of just
compensation for the land and
the improvements thereon,
preferably in favor of organized
cooperatives or associations,
which shall thereafter manage
the said lands for the workers —
beneficiaries.
Sec. 4. There shall be incorporated after Section 32
of Republic Act No. 6657 a section to read as
follows
Sec. 32-A. Incentives. —
Individuals or entities owning or
operating fishponds and prawn
farms are hereby mandated to
execute within six (6) months
from the effectivity of this Act, an
incentive plan with their regular
fishpond or prawn farm workers'
organization, if any, whereby
seven point five percent (7.5%)
of their net profit before tax from
the operation of the fishpond or
prawn farms are distributed
within sixty (60) days at the end
of the fiscal year as
compensation to regular and
other pond workers in such
ponds over and above the
compensation they currently
receive.
In order to safeguard the right of
the regular fishpond or prawn
farm workers under the incentive
plan, the books of the fishpond or
prawn owners shall be subject to
periodic audit or inspection by
certified public accountants
chosen by the workers.
The foregoing provision shall not
apply to agricultural lands
subsequently converted to
fishponds or prawn farms
G.R. No. 147780      May 10, 2001
PANFILO LACSON, MICHAEL RAY B. AQUINO and CESAR O.
MANCAO, petitioners,
vs.
SECRETARY HERNANDO PEREZ, P/DIRECTOR LEANDRO
MENDOZA, and P/SR. SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147781      May 10, 2001
MIRIAM DEFENSOR-SANTIAGO, petitioner,
vs.
ANGELO REYES, Secretary of National Defense, ET AL.,
respondents.
----------------------------------------
G.R. No. 147799      May 10, 2001
RONALDO A. LUMBAO, petitioner,
vs.
SECRETARY HERNANDO PEREZ, GENERAL DIOMEDIO
VILLANUEVA, P/DIRECTOR LEANDRO MENDOZA, and P/SR.
SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147810      May 10, 2001
THE LABAN NG DEMOKRATIKONG PILIPINO, petitioner,
vs.
THE DEPARTMENT OF JUSTICE, SECRETARY HERNANDO
PEREZ, THE ARMED FORCES OF THE PHILIPPINES, GENERAL
DIOMEDIO VILLANUEVA, THE PHILIPPINE NATIONAL POLICE,
and DIRECTOR GENERAL LEANDRO MENDOZA, respondents.
RESOLUTION
MELO, J.:
On May 1, 2001, President Macapagal-Arroyo, faced by an "angry and
violent mob armed with explosives, firearms, bladed weapons, clubs,
stones and other deadly weapons" assaulting and attempting to break
into Malacañang, issued Proclamation No. 38 declaring that there was
a state of rebellion in the National Capital Region. She likewise issued
General Order No. 1 directing the Armed Forces of the Philippines and
the Philippine National Police to suppress the rebellion in the National
Capital Region. Warrantless arrests of several alleged leaders and
promoters of the "rebellion" were thereafter effected.
Aggrieved by the warrantless arrests, and the declaration of a "state of
rebellion," which allegedly gave a semblance of legality to the arrests,
the following four related petitions were filed before the Court –
(1) G. R. No. 147780 for prohibition, injunction, mandamus, and
habeas corpus (with an urgent application for the issuance of temporary
restraining order and/or writ of preliminary injunction) filed by Panfilio M.
Lacson, Michael Ray B. Aquino, and Cezar O. Mancao; (2) G. R. No.
147781 for mandamus and/or review of the factual basis for the
suspension of the privilege of the writ of habeas corpus, with prayer for
the suspension of the privilege of the writ of habeas corpus, with prayer
for a temporary restraining order filed by Miriam Defensor-Santiago; (3)
G. R. No. 147799 for prohibition and injunction with prayer for a writ of
preliminary injunction and/or restraining order filed by Ronaldo A.
Lumbao; and (4) G. R. No. 147810 for certiorari and prohibition filed by
the political party Laban ng Demokratikong Pilipino.
All the foregoing petitions assail the declaration of a state of rebellion
by President Gloria Macapagal-Arroyo and the warrantless arrests
allegedly effected by virtue thereof, as having no basis both in fact and
in law. Significantly, on May 6, 2001, President Macapagal-Arroyo
ordered the lifting of the declaration of a "state of rebellion" in Metro
Manila. Accordingly, the instant petitions have been rendered moot and
academic. As to petitioners' claim that the proclamation of a "state of
rebellion" is being used by the authorities to justify warrantless arrests,
the Secretary of Justice denies that it has issued a particular order to
arrest specific persons in connection with the "rebellion." He states that
what is extant are general instructions to law enforcement officers and
military agencies to implement Proclamation No. 38. Indeed, as stated
in respondents' Joint Comments:
[I]t is already the declared intention of the Justice
Department and police authorities to obtain regular
warrants of arrests from the courts for all acts committed
prior to and until May 1, 2001 which means that
preliminary investigations will henceforth be conducted.
(Comment, G.R. No. 147780, p. 28; G.R. No.
147781, p. 18; G.R. No. 147799, p. 16; G.R. No.
147810, p. 24)
With this declaration, petitioners' apprehensions as to warrantless
arrests should be laid to rest.
In quelling or suppressing the rebellion, the authorities may only resort
to warrantless arrests of persons suspected of rebellion, as provided
under Section 5, Rule 113 of the Rules of Court, if the circumstances so
warrant. The warrantless arrest feared by petitioners is, thus, not based
on the declaration of a "state of rebellion."
Moreover, petitioners' contention in G. R. No. 147780 (Lacson Petition),
147781 (Defensor-Santiago Petition), and 147799 (Lumbao Petition)
that they are under imminent danger of being arrested without warrant
do not justify their resort to the extraordinary remedies of mandamus
and prohibition, since an individual subjected to warrantless arrest is
not without adequate remedies in the ordinary course of law. Such an
individual may ask for a preliminary investigation under Rule 112 of the
Rules of Court, where he may adduce evidence in his defense, or he
may submit himself to inquest proceedings to determine whether or not
he should remain under custody and correspondingly be charged in
court. Further, a person subject of a warrantless arrest must be
delivered to the proper judicial authorities within the periods provided in
Article 125 of the Revised Penal Code, otherwise the arresting officer
could be held liable for delay in the delivery of detained persons.
Should the detention be without legal ground, the person arrested can
charge the arresting officer with arbitrary detention. All this is without
prejudice to his filing an action for damages against the arresting officer
under Article 32 of the Civil Code. Verily, petitioners have a surfeit of
other remedies which they can avail themselves of, thereby making the
prayer for prohibition and mandamus improper at this time (Section 2
and 3, Rule 65, Rules of Court).1âwphi1.nêt
Aside from the foregoing reasons, several considerations likewise
inevitably call for the dismissal of the petitions at bar.
G.R. No. 147780
In connection with their alleged impending warrantless arrest,
petitioners Lacson, Aquino, and mancao pray that the "appropriate
court before whom the informations against petitioners are filed be
directed to desist from arraigning and proceeding with the trial of the
case, until the instant petition is finally resolved." This relief is clearly
premature considering that as of this date, no complaints or charges
have been filed against any of the petitioners for any crime. And in the
event that the same are later filed, this Court cannot enjoin criminal
prosecution conducted in accordance with the Rules of Court, for by
that time any arrest would have been in pursuant of a duly issued
warrant.
As regards petitioners' prayer that the hold departure orders issued
against them be declared null and void ab initio, it is to be noted that
petitioners are not directly assailing the validity of the subject hold
departure orders in their petition. They are not even expressing
intention to leave the country in the near future. The prayer to set aside
the same must be made in proper proceedings initiated for that
purpose.
Anent petitioners' allegations ex abundante ad cautelam in support of
their application for the issuance of a writ of habeas corpus, it is
manifest that the writ is not called for since its purpose is to relieve
petitioners from unlawful restraint (Ngaya-an v. Balweg, 200 SCRA 149
[1991]), a matter which remains speculative up to this very day.
G.R. No. 147781
The petition herein is denominated by petitioner Defensor-Santiago as
one for mandamus. It is basic in matters relating to petitions for
mandamus that the legal right of the petitioner to the performance of a
particular act which is sought to be compelled must be clear and
complete. Mandamus will not issue unless the right to relief is clear at
the time of the award (Palileo v. Ruiz Castro, 85 Phil. 272). Up to the
present time, petitioner Defensor Santiago has not shown that she is in
imminent danger of being arrested without a warrant. In point of fact,
the authorities have categorically stated that petitioner will not be
arrested without a warrant.
G.R. No. 147799
Petitioner Lumbao, leader of the People's Movement against Poverty
(PMAP), for his part, argues that the declaration of a "state of rebellion"
is violative of the doctrine of separation of powers, being an
encroachment on the domain of the judiciary which has the
constitutional prerogative to "determine or interpret" what took place on
May 1, 2001, and that the declaration of a state of rebellion cannot be
an exception to the general rule on the allocation of the governmental
powers.
We disagree. To be sure, Section 18, Article VII of the Constitution
expressly provides that "[t]he President shall be the Commander-in-
Chief of all armed forces of the Philippines and whenever it becomes
necessary, he may call out such armed forces to prevent or suppress
lawless violence, invasion or rebellion…" Thus, we held in Integrated
Bar of the Philippines v. Hon. Zamora, (G.R. No. 141284, August 15,
2000):
x x x The factual necessity of calling out the armed forces is
not easily quantifiable and cannot be objectively established
since matters considered for satisfying the same is a
combination of several factors which are not always
accessible to the courts. Besides the absence of textual
standards that the court may use to judge necessity,
information necessary to arrive at such judgment might also
prove unmanageable for the courts. Certain pertinent
information might be difficult to verify, or wholly unavailable to
the courts. In many instances, the evidence upon which the
 President might decide that there is a need to call out the
armed forces may be of a nature not constituting technical
proof.
On the other hand, the President as Commander-in-Chief has
a vast intelligence network to gather information, some of
which may be classified as highly confidential or affecting the
security of the state. In the exercise of the power to call, on-
the-spot decisions may be imperatively necessary in
emergency situations to avert great loss of human lives and
mass destruction of property. x x x
(at pp.22-23)
The Court, in a proper case, may look into the sufficiency of the factual
basis of the exercise of this power. However, this is no longer feasible
at this time, Proclamation No. 38 having been lifted.
G.R. No. 147810
Petitioner Laban ng Demokratikong Pilipino is not a real party-in-
interest. The rule requires that a party must show a personal stake in
the outcome of the case or an injury to himself that can be redressed by
a favorable decision so as to warrant an invocation of the court's
jurisdiction and to justify the exercise of the court's remedial powers in
his behalf (KMU Labor Center v. Garcia, Jr., 239 SCRA 386 [1994]).
Here, petitioner has not demonstrated any injury to itself which would
justify resort to the Court. Petitioner is a juridical person not subject to
arrest. Thus, it cannot claim to be threatened by a warrantless arrest.
Nor is it alleged that its leaders, members, and supporters are being
threatened with warrantless arrest and detention for the crime of
rebellion. Every action must be brought in the name of the party whose
legal right has been invaded or infringed, or whose legal right is under
imminent threat of invasion or infringement.
At best, the instant petition may be considered as an action for
declaratory relief, petitioner claiming that its right to freedom of
expression and freedom of assembly is affected by the declaration of a
"state of rebellion" and that said proclamation is invalid for being
contrary to the Constitution.
However, to consider the petition as one for declaratory relief affords
little comfort to petitioner, this Court not having jurisdiction in the first
instance over such a petition. Section 5[1], Article VIII of the
Constitution limits the original jurisdiction of the Court to cases affecting
ambassadors, other public ministers and consuls, and over petitions for
certiorari, prohibition, mandamus, quo warranto, and habeas corpus.
WHEREFORE, premises considered, the petitions are hereby
DISMISSED. However, in G.R. No. 147780, 147781, and 147799,
respondents, consistent and congruent with their undertaking earlier
adverted to, together with their agents, representatives, and all persons
acting for and in their behalf, are hereby enjoined from arresting
petitioners therein without the required judicial warrant for all acts
committed in relation to or in connection with the may 1, 2001 siege of
Malacañang.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Puno, Mendoza, Panganiban, Gonzaga-
Reyes, JJ., concur.
Vitug, separate opinion.
Kapunan, dissenting opinion.
Pardo, join the dissent of J. Kapunan.
Sandoval-Gutierrez, dissenting opinion.
Quisumbing, Buena, Ynares-Santiago, De Leon, Jr., on leave.
G.R. No. 147780      May 10, 2001
PANFILO LACSON, MICHAEL RAY B. AQUINO and CESAR O.
MANCAO, petitioners,
vs.
SECRETARY HERNANDO PEREZ, P/DIRECTOR LEANDRO
MENDOZA, and P/SR. SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147781      May 10, 2001
MIRIAM DEFENSOR-SANTIAGO, petitioner,
vs.
ANGELO REYES, Secretary of National Defense, ET AL.,
respondents.
SEPARATE OPINION
VITUG, J.:
I concur insofar as the resolution enjoins any continued
warrantless arrests for acts related to, or connected with, the May
1st incident but respectfully dissent from the order of dismissal of
the petitions for being said to be moot and academic. The
petitions have raised important constitutional issues that, in my
view, must likewise be fully addressed.
G.R. No. 147780      May 10, 2001
PANFILO LACSON, MICHAEL RAY B. AQUINO and CESAR O.
MANCAO, petitioners,
vs.
SECRETARY HERNANDO PEREZ, P/DIRECTOR LEANDRO
MENDOZA, and P/SR. SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147781      May 10, 2001
MIRIAM DEFENSOR-SANTIAGO, petitioner,
vs.
ANGELO REYES, Secretary of National Defense, ET AL.,
respondents.
----------------------------------------
G.R. No. 147799      May 10, 2001
RONALDO A. LUMBAO, petitioner,
vs.
SECRETARY HERNANDO PEREZ, GENERAL DIOMEDIO
VILLANUEVA, P/DIRECTOR LEANDRO MENDOZA, and P/SR.
SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147810      May 10, 2001
THE LABAN NG DEMOKRATIKONG PILIPINO, petitioner,
vs.
THE DEPARTMENT OF JUSTICE, SECRETARY HERNANDO
PEREZ, THE ARMED FORCES OF THE PHILIPPINES, GENERAL
DIOMEDIO VILLANUEVA, THE PHILIPPINE NATIONAL POLICE,
and DIRECTOR GENERAL LEANDRO MENDOZA, respondents.
DISSENTING OPINION
KAPUNAN, J.:
The right against unreasonable searches and seizure has been
characterized as belonging "in the catalog of indispensable freedoms."
Among deprivation of rights, none is so effective in cowing a
population, crushing the spirit of the individual and putting
terror in every heart. Uncontrolled search and seizure is one
of the first and most effective weapons in the arsenal of every
arbitrary government. And one need only briefly to have dwelt
and worked among a people know that the human personality
deteriorates and dignity and self-reliance disappear where
homes, persons and possessions are subject at any hour to
unheralded search and seizure by the police.1
Invoking the right against unreasonable searches and seizures,
petitioners Panfilo Lacson, Michael Ray Aquino and Cezar O. Mancao
II now seek a temporary restraining order and/or injunction from the
Court against their impending warrantless arrests upon order of the
Secretary of Justice.2 Petitioner Laban ng Demokratikong Pilipino
(LDP), likewise, seeks to enjoin the arrests of its senatorial candidates,
namely, Senator Juan Ponce-Enrile, Senator Miriam Defensor-
Santiago, Senator Gregorio B. Honasan and General Panfilo Lacson. 3
Separate petitioners were also filed by Senator Juan Ponce Enrile. 4
Former Ambassador Ernesto M. Maceda, 5 Senator Miriam Defensor-
Santiago,6 Senator Gregorio B. Honasan,7 and the Integrated Bar of the
Philippines (IBP).8
Briefly, the order for the arrests of these political opposition leaders and
police officers stems from the following facts:
On April 25, 2001, former President Joseph Estrada was arrested upon
the warrant issued by the Sandiganbayan in connection with the
criminal case for plunder filed against him. Several hundreds of
policemen were deployed to effect his arrest. At the time, a number of
Mr. Estrada's supporters, who were then holding camp outside his
residence in Greenhills Subdivision, sought to prevent his arrest. A
skirmish ensued between them and the police. The police had to
employ batons and water hoses to control the rock-throwing pro-
Estrada rallyists and allow the sheriffs to serve the warrant. Mr. Estrada
and his son and co-accused, Mayor Jinggoy Estrada, were then
brought to Camp Crame where, with full media coverage, their
fingerprints were obtained and their mug shots taken.
Later that day, and on the succeeding days, a huge gathered at the
EDSA Shrine to show its support for the deposed President. Senators
Enrile, Santiago, Honasan, opposition senatorial candidates including
petitioner Lacson, as well as other political personalities, spoke before
the crowd during these rallies.
In the meantime, on April 28, 2001, Mr. Estrada and his son were
brought to the Veterans memorial Medical Center for a medical check-
up. It was announced that from there, they would be transferred to Fort
Sto. Domingo in Sta. Rosa, Laguna.
In the early morning of May 1, 2001, the crowd at EDSA decided to
march to Malacañang Palace. The Armed Forces of the Philippines
(AFP) was called to reinforce the Philippine National Police (PNP) to
guard the premises of the presidential residence. The marchers were
able to penetrate the barricades put up by the police at various points
leading to Mendiola and were able to reach Gate 7 of Malacañan. As
they were being dispersed with warning shots, tear gas and water
canons, the rallyists hurled stones at the police authorities. A melee
erupted. Scores of people, including some policemen, were hurt.
At noon of the same day, after the crowd in Mendiola had been
dispersed, President Gloria Macapagal-Arroyo issued Proclamation No.
38 declaring a "state of rebellion" in Metro Manila:
Presidential Proclamation No. 38
DECLARING STATE OF REBELLION IN THE NATIONAL
CAPITAL REGION
WHEREAS, the angry and violent mob, armed with
explosives, firearms, bladed weapons, clubs, stones and
other deadly weapons, in great part coming from the mass
gathering at the EDSA Shrine, and other armed groups,
having been agitated and incited and, acting upon the
instigation and under the command and direction of known
and unknown leaders, have and continue to assault and
attempt to break into Malacañang with the avowed purpose of
overthrowing the duly constituted Government and forcibly
seize power, and have and continue to rise publicly, shown
open hostility, and take up arms against the duly constituted
Government for the purpose of removing from the allegiance
to the Government certain bodies of the Armed Forces of the
Philippines and the Philippine National Police, and to deprive
the President of the Republic of the Philippines, wholly and
partially, of her powers and prerogatives which constitute the
continuing crime of rebellion punishable under Article 134 of
the Revised Penal Code;
WHEREAS, armed groups recruited by known and unknown
leaders, conspirators, and plotters have continue (sic) to rise
publicly by the use of arms to overthrow the duly constituted
Government and seize political power;
WHEREAS, under Article VII, Section 18 of the Constitution,
whenever necessary, the President as the Commander-in-
Chief of all armed forces of the Philippines, may call out such
armed forces to suppress the rebellion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, by
virtue of the powers vested in me by law hereby recognize
and confirm the existence of an actual and on-going rebellion
compelling me to declare a state of rebellion;
In view of the foregoing, I am issuing General Order NO. 1 in
accordance with Section 18, Article VII of the Constitution
calling upon the Armed Forces of the Philippines and the
Philippine National police to suppress and quell the rebellion.
City of Manila, May 1, 2001.
The President likewise issued General Order No. 1 which
reads:
GENERAL ORDER NO. 1
DIRECTING THE ARMED FORCES OF THE PHILIPPIENS
AND THE PHILIPPINE NATIONAL POLICE TO SUPPRESS
THE REBELLION IN THE NATIONAL CAPITAL REGION
WHEREAS, the angry and violent mob, armed with
explosives, firearms, bladed weapons, clubs, stones and
other deadly weapons, in great part coming from the mass
gathering at the EDSA Shrine, and other armed groups,
having been agitated and incited and, acting upon the
instigation and under the command and direction of known
and unknown leaders, have and continue to assault and
attempt to break into Malacañang with the avowed purpose of
overthrowing the duly constituted Government and forcibly
seize political power, and have and continue to rise publicly,
show open hostility, and take up arms against the duly
constituted Government certain bodies of the Armed Forces
of the Philippines and the Philippine National Police, and to
deprive the President of the Republic of the Philippines,
wholly and partially, of her powers and prerogatives which
constitute the continuing crime of rebellion punishable under
Article 134 of the Revised Penal Code;
WHEREAS, armed groups recruited by known and unknown
leaders, conspirators, and plotters have continue (sic) to rise
publicly by the use of arms to overthrow the duly constituted
Government and seize political power;
WHEREAS, under Article VII, Section 18 of the Constitution,
whenever necessary, the President as the Commander-in-
Chief of all armed forces of the Philippines, may call out such
armed forces to suppress the rebellion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, by
virtue of the powers vested in me under the Constitution as
President of the Republic of the Philippines and Commander-
in-Chief of all armed forces of the Philippines and pursuant to
Proclamation No. 38, dated May 1, 2001, do hereby call upon
the Armed Forces of the Philippines and the Philippine
national police to suppress and quell the rebellion.
I hereby direct the Chief of Staff of the Armed Forces of the
Philippines and the Chief of the Philippine National Police and
the officers and men of the Armed Forces of the Philippines
and the Philippine National Police to immediately carry out the
necessary and appropriate actions and measures to suppress
and quell the rebellion with due regard to constitutional rights.
City of Manila, May 1, 2001.
Pursuant to the proclamation, several key leaders of the opposition
were ordered arrested. Senator Enrile was arrested without warrant in
his residence at around 4:00 in the afternoon. Likewise arrested without
warrant the following day was former Ambassador Ernesto Maceda.
Senator Honasan and Gen. Lacson were also ordered arrested but the
authorities have so far failed to apprehend them. Ambassador Maceda
was temporarily released upon recognizance while Senator Ponce
Enrile was ordered released by the Court on cash bond.
The basic issue raised by the consolidated petitions is whether the
arrest or impending arrest without warrant, pursuant to a declaration of
"state of rebellion" by the President of the above-mentioned persons
and unnamed other persons similarly situated suspected of having
committed rebellion is illegal, being unquestionably a deprivation of
liberty and violative of the Bill of Rights under the Constitution.
The declaration of a "state of rebellion" is supposedly based on Section
18, Article VII of the Constitution which reads:
The President shall be the Commander-in-Chief of all armed
forces of the Philippines and whenever it becomes necessary,
he may call out such armed forces to prevent or suppress
lawless violence, invasion or rebellion. In case of invasion or
rebellion, when the public safety requires it, he may, for a
period not exceeding sixty days, suspend the privilege of the
writ of habeas corpus or place the Philippines or any part
thereof under martial law. Within forty-eight hours from the
proclamation of martial law or the suspension of the writ of
habeas corpus, the President shall submit a report in person
or in writing to the Congress. The Congress, voting jointly, by
a vote of at least a majority of all its Members in regular or
special session, may revoke such proclamation or
suspension, which revocation shall not be set aside by the
President. Upon the initiative of the President, the Congress
may, in the same manner, extend such proclamation or
suspension for a period to be determined by the Congress if
the invasion or rebellion shall persist and public safety
requires it.
The Congress, if not in session, shall, within twenty-four hours
following such proclamation or suspension, convene in
accordance with its rules without need of a call.
The Supreme Court may review, in an appropriate proceeding
filed by any citizen, the sufficiency of the factual basis of the
proclamation of martial law or the suspension of the privilege
of the writ or the extension thereof, and must promulgate its
decision thereon within thirty days from its filing.
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or
legislative assemblies, nor authorize the conferment of
jurisdiction on military courts and agencies over civilians
where civil courts are able to function, nor automatically
suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to
persons judicially charged for rebellion or offenses inherent in
or directly connected with invasion.
During the suspension of the privilege of the writ, any person
thus arrested or detained shall be judicially charged within
three days, otherwise he shall be released.
Section 18 grants the President, as Commander-in-Chief, the power to
call out the armed forces in cases of (1) lawless violence, (2) rebellion
and (3) invasion.9 In the latter two cases, i.e., rebellion or invasion, the
President may, when public safety requires, also (a) suspend the
privilege of the writ of habeas corpus, or (b) place the Philippines or any
part thereof under martial law. However, in the exercise of this calling
out power as Commander-in-Chief of the armed forces, the Constitution
does not require the President to make a declaration of a "state of
rebellion" (or, for that matter, of lawless violence or invasion). The term
"state of rebellion" has no legal significance. It is vague and amorphous
and does not give the President more power than what the Constitution
says, i. e, whenever it becomes necessary, he may call out such armed
forces to prevent or suppress lawless violence, invasion or rebellion. As
Justice Mendoza observed during the hearing of this case, such a
declaration is "legal surplusage." But whatever the term means, it
cannot diminish or violate constitutionally-protected rights, such as the
right to due process,10 the rights to free speech and peaceful assembly
to petition the government for redress of grievances, 11 and the right
against unreasonable searches and seizures,12 among others.
In Integrated Bar of the Philippines vs. Zamora, et al.,13 the Court held
that:
 x x x [T]he distinction (between the calling out power, on one
hand, and the power to suspend the privilege of the write of
habeas corpus and to declare martial law, on the other hand)
places the calling out power in a different category from the
power to declare martial law and the power to suspend the
privilege of the writ of habeas corpus, otherwise, the framers
of the Constitution would have simply lumped together the
three powers and provided for their revocation and review
without any qualification. Expressio unius est exclusio alterius.
xxx
The reason for the difference in the treatment of the
aforementioned powers highlights the intent to grant the
President the widest leeway and broadest discretion in using
the "calling out" power because it is considered as the lesser
and more benign power compared to the power to suspend
the privilege of the writ of habeas corpus and the power to
impose martial law, both of which involve the curtailment and
suppression of certain basic civil rights and individual
freedoms, and thus necessitating affirmation by Congress
and, in appropriate cases, review by this Court.
On the other hand, if the motive behind the declaration of a "state of
rebellion" is to arrest persons without warrant and detain them without
bail and, thus, skirt the Constitutional safeguards for the citizens' civil
liberties, the so-called "state of rebellion" partakes the nature of martial
law without declaring on its face, yet, if it is applied and administered by
public authority with an evil eye so as to practically make it unjust and
oppressive, it is within the prohibition of the Constitution. 14 In an ironic
sense, a "state of rebellion" declared as a subterfuge to effect
warrantless arrest and detention for an unbailable offense places a
heavier burden on the people's civil liberties than the suspension of the
privilege of the writ of habeas corpus the declaration of martial law
because in the latter case, built-in safeguards are automatically set on
motion: (1) The period for martial law or suspension is limited to a
period not exceeding sixty day; (2) The President is mandated to
submit a report to Congress within forty-eight hours from the
proclamation or suspension; (3) The proclamation or suspension is
subject to review by Congress, which may revoke such proclamation or
suspension. If Congress is not in session, it shall convene in 24 hours
without need for call; and (4) The sufficiency of the factual basis thereof
or its extension is subject to review by the Supreme Court in an
appropriate proceeding.15
No right is more fundamental than the right to life and liberty. Without
these rights, all other individual rights may not exist. Thus, the very first
section in our Constitution's Bill of Rights, Article III, reads:
SECTION 1. No person shall be deprived of life, liberty, or
property without due process of law, nor shall any person be
denied the equal protection of the laws.
And to assure the fullest protection of the right, more especially against
government impairment, Section 2 thereof provides:
SEC. 2. The right of the people to be secure in their persons,
houses, papers, and effects against unreasonable searches
and seizures of whatever nature and for any purpose shall be
inviolable, and no search warrant or warrant of arrest shall
issue except upon probable cause to be determined
personally by the judge after examination under oath or
affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched
and the persons or things to be seized.
Indeed, there is nothing in Section 18 which authorizes the President or
any person acting under her direction to make unwarranted arrests.
The existence of "lawless violence, invasion or rebellion" only
authorizes the President to call out the "armed forces to prevent or
suppress lawless violence, invasion or rebellion."
Not even the suspension of the privilege of the writ of habeas corpus or
the declaration of martial law authorizes the President to order the
arrest of any person. The only significant consequence of the
suspension of the writ of habeas corpus is to divest the courts of the
power to issue the writ whereby the detention of the person is put in
issue. It does not by itself authorize the President to order the arrest of
a person. And even then, the Constitution in Section 18, Article VII
makes the following qualifications:
The suspension of the privilege of the writ shall apply only to
persons judicially charged for rebellion or offenses inherent in
or directly connected with invasion.
During the suspension of the privilege of the writ, any person
thus arrested or detained shall be judicially charged within
three days, otherwise he shall be released.
In the instant case, the President did not suspend the writ of habeas
corpus. Nor did she declare martial law. A declaration of a "state of
rebellion," at most, only gives notice to the nation that it exists, and that
the armed forces may be called to prevent or suppress it, as in fact she
did. Such declaration does not justify any deviation from the
Constitutional proscription against unreasonable searches and
seizures.
As a general rule, an arrest may be made only upon a warrant issued
by a court. In very circumscribed instances, however, the Rules of
Court allow warrantless arrests. Section 5, Rule 113 provides:
SEC. 5. Arrest without warrant; when lawful. – A police officer
or a private person may, without a warrant, arrest a person:
(a) When, in his presence, the person to be arrested has
committed, is actually committing, or is attempting to commit
an offense;
(b) When an offense has just been committed and he has
probable cause to believe based on personal knowledge of
facts or circumstances that the person to be arrested has
committed it; and
xxx
In cases falling under paragraphs (a) and (b) above, the
person arrested without a warrant shall be forthwith delivered
to the nearest police station or jail and shall be proceeded
against in accordance with section 7 of Rule 112.
It must be noted that the above are exceptions to the constitutional
norm enshrined in the Bill of Rights that a person may only be arrested
on the strength of a warrant of arrest issued by a "judge" after
determining "personally" the existence of "probable cause" after
examination under oath or affirmation of the complainant and the
witnesses he may produce. Its requirements should, therefore, be
scrupulously met:
The right of a person to be secure against any unreasonable
seizure of his body and any deprivation of his liberty is a most
basic and fundamental one. The statute or rule which allows
exceptions to the requirement of warrants of arrests is strictly
construed. Any exception must clearly fall within the situations
when securing a warrant would be absurd or is manifestly
unnecessary as provided by the Rule. We cannot liberally
construe the rule on arrests without warrant or extend its
application beyond the cases specifically provided by law. To
do so would infringe upon personal liberty and set back a
basic right so often violated and so deserving of full
protection.16
A warrantless arrest may be justified only if the police officer had facts
and circumstances before him which, had they been before a judge,
would constitute adequate basis for a finding of probable cause of the
commission of an offense and that the person arrested is probably
guilty of committing the offense. That is why the Rules of Criminal
Procedure require that when arrested, the person "arrested has
committed, is actually committing, or is attempting to commit an
offense" in the presence of the arresting officer. Or if it be a case of an
offense which had "just been committed," that the police officer making
the arrest "has personal knowledge of facts or circumstances that the
person to be arrested has committed it."
Petitioners were arrested or sought to be arrested without warrant for
acts of rebellion ostensibly under Section 5 of Rule 113. Respondents'
theory is based on Umil vs. Ramos,17 where this Court held:
The crimes of rebellion, subversion, conspiracy or proposal to
commit such crimes, and crimes or offenses committed in
furtherance thereof or in connection therewith constitute direct
assault against the State and are in the nature of continuing
crimes.18
Following this theory, it is argued that under Section 5(a), a person who
"has committed, is actually committing, or is attempting to commit"
rebellion and may be arrested without a warrant at any time so long as
the rebellion persists.
Reliance on Umil is misplaced. The warrantless arrests therein,
although effected a day or days after the commission of the violent acts
of petitioners therein, were upheld by the Court because at the time of
their respective arrests, they were members of organizations such as
the Communist Party of the Philippines, the New Peoples Army and the
National United Front Commission, then outlawed groups under the
Anti-Subversion Act. Their mere membership in said illegal
organizations amounted to committing the offense of subversion 19
which justified their arrests without warrants.
In contrast, it has not been alleged that the persons to be arrested for
their alleged participation in the "rebellion" on May 1, 2001 are
members of an outlawed organization intending to overthrow the
government. Therefore, to justify a warrantless arrest under Section
5(a), there must be a showing that the persons arrested or to be
arrested has committed, is actually committing or is attempting to
commit the offense of rebellion. 20 In other words, there must be an overt
act constitutive of rebellion taking place in the presence of the arresting
officer. In United States vs. Samonte, 21 the term" in his [the arresting
officer's] presence" was defined thus:
An offense is said to be committed in the presence or within
the view of an arresting officer or private citizen when such
officer or person sees the offense, even though at a distance,
or hears the disturbance created thereby and proceeds at
once to the scene thereof; or the offense is continuing, or has
not been consummated, at the time the arrest is made.22
This requirement was not complied with particularly in the arrest of
Senator Enrile. In the Court's Resolution of May 5, 2001 in the petition
for habeas corpus filed by Senator Enrile, the Court noted that the
sworn statements of the policemen who purportedly arrested him were
hearsay.23 Senator Enrile was arrested two (2) days after he delivered
allegedly seditious speeches. Consequently, his arrest without warrant
cannot be justified under Section 5(b) which states that an arrest
without a warrant is lawful when made after an offense has just been
committed and the arresting officer or private person has probable
cause to believe based on personal knowledge of facts and
circumstances that the person arrested has committed the offense.
At this point, it must be stressed that apart from being inapplicable to
the cases at bar, Umil is not without any strong dissents. It merely re-
affirmed Garcia-Padilla vs. Enrile,24 a case decided during the Marcos
martial law regime.25 It cannot apply when the country is supposed to
be under the regime of freedom and democracy. The separate opinions
of the following Justices in the motion for reconsideration of said case 26
are apropos:
FERNAN C.J., concurring and dissenting:
Secondly, warrantless arrests may not be allowed if the
arresting officers are not sure what particular provision of law
had been violated by the person arrested. True it is that law
enforcement agents and even prosecutors are not all adept at
the law. However, erroneous perception, not to mention
ineptitude among their ranks, especially if it would result in the
violation of any right of a person, may not be tolerated. That
the arrested person has the "right to insist during the pre-trial
or trial on the merits" (Resolution, p. 18) that he was
exercising a right which the arresting officer considered as
contrary to law, is beside the point. No person should be
subjected to the ordeal of a trial just because the law
enforcers wrongly perceived his action. 27 (Underscoring
supplied)
GUTIERREZ, JR., J., concurring and dissenting opinion
Insofar as G.R. NO. 81567 is concerned, I joint the other
dissenting Justices in their observations regarding "continuing
offenses." To base warrantless arrests on the doctrine of
continuing offense is to give a license for the illegal detention
of persons on pure suspicion. Rebellion, insurrection, or
sedition are political offenses where the line between overt
acts and simple advocacy or adherence to a belief is
extremely thin. If a court has convicted an accused of
rebellion and he is found roaming around, he may be
arrested. But until a person is proved guilty, I fail to see how
anybody can jump to a personal conclusion that the suspect is
indeed a rebel and must be picked up on sight whenever
seen. The grant of authority in the majority opinion is too
broad. If warrantless searches are to be validated, it should
be Congress and not this Court which should draw strict and
narrow standards. Otherwise, the non-rebels who are critical,
noisy, or obnoxious will be indiscriminately lumped up with
those actually taking up arms against the Government.
The belief of law enforcement authorities, no matter how well-
grounded on past events, that the petitioner would probably
shoot other policemen whom he may meet does not validate
warrantless arrests. I cannot understand why the authorities
preferred to bide their time, await the petitioner's surfacing
from underground, and ounce on him with no legal authority
instead of securing warrants of arrest for his apprehension.28
(Underscoring supplied)
CRUZ, J., concurring and dissenting:
I submit that the affirmation by this Court of the Garcia-Padilla
decision to justify the illegal arrests made in the cases before
us is a step back to that shameful past when individual rights
were wantonly and systematically violated by the Marcos
dictatorship. It seem some of us have short memories of that
repressive regime, but I for one am not one to forget so soon.
As the ultimate defender of the Constitution, this Court should
not gloss over the abuses of those who, out of mistaken zeal,
would violate individual liberty in the dubious name of national
security. Whatever their ideology and even if it be hostile to
ours, the petitioners are entitled to the protection of the Bill of
Rights, no more and no less than any other person in this
country. That is what democracy is all about.29 (Underscoring
supplied)
FELICIANO, J., concurring and dissenting:
12. My final submission, is that, the doctrine of "continuing
crimes," which has its own legitimate function to serve in our
criminal law jurisprudence, cannot be invoked for weakening
and dissolving the constitutional guarantee against
warrantless arrest. Where no overt acts comprising all or
some of the elements of the offense charged are shown to
have been committed by the person arrested without warrant,
the "continuing crime" doctrine should not be used to dress up
the pretense that a crime, begun or committed elsewhere,
continued to be committed by the person arrested in the
presence of the arresting officer. The capacity for mischief of
such a utilization of the "continuing crimes" doctrine, is
infinitely increased where the crime charged does not consist
of unambiguous criminal acts with a definite beginning and
end in time and space (such as the killing or wounding of a
person or kidnapping and illegal detention or arson) but rather
or such problematic offenses as membership in or affiliation
with or becoming a member of, a subversive association or
organization. For in such cases, the overt constitutive acts
may be morally neutral in themselves, and the unlawfulness
of the acts a function of the aims or objectives of the
organization involved. Note, for instance, the following acts
which constitute prima facie evidence of "membership in any
subversive association:"
a) Allowing himself to be listed as a member in any book or
any of the lists, records, correspondence, or any other
document of the organization;
b) Subjecting himself to the discipline of such or association
or organization in any form whatsoever;
c) Giving financial contribution to such association or
organization in dues, assessments, loans or in any other
forms;
xxx
f) Conferring with officers or other members of such
association or organization in furtherance of any plan or
enterprise thereof;
xxx
g) Preparing documents, pamphlets, leaflets, books, or any
other type of publication to promote the objectives and
purposes of such association or organization;
xxx
k) Participating in any way in the activities, planning action,
objectives, or purposes of such association or organization.
It may well be, as the majority implies, that the constitutional
rule against warrantless arrests and seizures makes the law
enforcement work of police agencies more difficult to carry
out. It is not our Court's function, however, and the Bill of
Rights was not designed, to make life easy for police forces
but rather to protect the liberties of private individuals. Our
police forces must simply learn to live with the requirements of
the Bill of Rights, to enforce the law by modalities which
themselves comply with the fundamental law. Otherwise they
are very likely to destroy, whether through sheer ineptness or
excess of zeal, the very freedoms which make our policy
worth protecting and saving.30 (Underscoring supplied)
It is observed that a sufficient period has lapsed between the fateful day
of May 1, 2001 up to the present. If respondents have ample evidence
against petitioners, then they should forthwith file the necessary
criminal complaints in order that the regular procedure can be followed
and the warrants of arrest issued by the courts in the normal course.
When practicable, resort to the warrant process is always to be
preferred because "it interposes an orderly procedure involving 'judicial
impartiality' whereby a neutral and detached magistrate can make
informed and deliberate determinations on the issue of probable
cause."31
The neutrality, detachment and independence that judges are
supposed to possess is precisely the reason the framers of the 1987
Constitution have reposed upon them alone the power to issue
warrants of arrest. To vest the same to a branch of government, which
is also charged with prosecutorial powers, would make such branch the
accused's adversary and accuser, his judge and jury.32
A declaration of a state of rebellion does not relieve the State of its
burden of proving probable cause. The declaration does not constitute
a substitute for proof. It does not in any way bind the courts, which must
still judge for itself the existence of probable cause. Under Section 18,
Article VII, the determination of the existence of a state of rebellion for
purposes of proclaiming martial law or the suspension of the privilege of
the writ of habeas corpus rests for which the President is granted
ample, though not absolute, discretion. Under Section 2, Article III, the
determination of probable cause is a purely legal question of which
courts are the final arbiters.
Justice Secretary Hernando Perez is reported to have announced that
the lifting of the "state of rebellion" on May 7, 2001 does not stop the
police from making warrantless arrests.33 If this is so, the pernicious
effects of the declaration on the people's civil liberties have not abated
despite the lifting thereof. No one exactly knows who are in the list or
who prepared the list of those to be arrested for alleged complicity in
the "continuing" crime of "rebellion" defined as such by executive fiat.
The list of the perceived leaders, financiers and supporters of the
"rebellion" to be arrested and incarcerated could expand depending on
the appreciation of the police. The coverage and duration of effectivity
of the orders of arrest are thus so open-ended and limitless as to place
in constant and continuing peril the people's Bill of Rights. It is of no
small significance that four of he petitioners are opposition candidates
for the Senate. Their campaign activities have been to a large extent
immobilized. If the arrests and orders of arrest against them are illegal,
then their Constitutional right to seek public office, as well as the right of
he people to choose their officials, is violated.
In view of the transcendental importance and urgency of the issues
raised in these cases affecting as they do the basic liberties of the
citizens enshrined in our Constitution, it behooves us to rule thereon
now, instead of relegating the cases to trial courts which unavoidably
may come up with conflicting dispositions, the same to reach this Court
inevitably for final ruling. As we aptly pronounced in Salonga vs. Cruz
Paño:34
The Court also has the duty to formulate guiding and
controlling constitutional principles, precepts, doctrines, or
rules. It has the symbolic function of educating bench and bar
on the extent of protection given by constitutional guarantees.
Petitioners look up in urgent supplication to the Court, considered the
last bulwark of democracy, for relief. If we do not act promptly, justly
and fearlessly, to whom will they turn to?
WHEREFORE, I vote as follows:
(1) Give DUE COURSE to and GRANT the petitions;
(2) Declare as NULL and VOID the orders of arrest issued
against petitioners;
(3) Issue a WRIT OF INJUNCTION enjoining respondents,
their agents and all other persons acting for and in their behalf
from effecting warrantless arrests against petitioners and all
other persons similarly situated on the basis of Proclamation
No. 38 and General Order No. 1 of the President.
SO ORDERED.
G.R. No. 147780      May 10, 2001
PANFILO LACSON, MICHAEL RAY B. AQUINO and CESAR O.
MANCAO, petitioners,
vs.
SECRETARY HERNANDO PEREZ, P/DIRECTOR LEANDRO
MENDOZA, and P/SR. SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147781      May 10, 2001
MIRIAM DEFENSOR-SANTIAGO, petitioner,
vs.
ANGELO REYES, Secretary of National Defense, ET AL.,
respondents.
----------------------------------------
G.R. No. 147799      May 10, 2001
RONALDO A. LUMBAO, petitioner,
vs.
SECRETARY HERNANDO PEREZ, GENERAL DIOMEDIO
VILLANUEVA, P/DIRECTOR LEANDRO MENDOZA, and P/SR.
SUPT. REYNALDO BERROYA, respondents.
----------------------------------------
G.R. No. 147810      May 10, 2001
THE LABAN NG DEMOKRATIKONG PILIPINO, petitioner,
vs.
THE DEPARTMENT OF JUSTICE, SECRETARY HERNANDO
PEREZ, THE ARMED FORCES OF THE PHILIPPINES, GENERAL
DIOMEDIO VILLANUEVA, THE PHILIPPINE NATIONAL POLICE,
and DIRECTOR GENERAL LEANDRO MENDOZA, respondents.
DISSENTING OPINION
SANDOVAL-GUTIERREZ, J.:
The exercise of certain powers by the President in an atmosphere of
civil unrest may sometimes raise constitutional issues. If such powers
are used arbitrarily and capriciously, they may degenerate into the
worst form of despotism.
It is on this premise that I express my dissent.
The chain of events which led to the present constitutional crisis are as
follows:
On March 2, 2001, the Supreme Court rendered the landmark decision
that would bar further questions on the legitimacy of Gloria Macapagal-
Arroyo's presidency.1 In a unanimous decision, the Court declared that
Joseph Ejercito Estrada had effectively resigned his post and that
Macapagal-Arroyo is the legitimate President of the Philippines.
Estrada was stripped of all his powers and presidential immunity from
suit.
Knowing that a warrant of arrest may at any time be issued against
Estrada, his loyalists rushed to his residence in Polk Street, North
Greenhills Subdivision, San Juan, Metro Manila. They conducted vigil in
the vicinity swearing that no one can take away their "president."
Then the dreadful day for the Estrada loyalists came.
On April 25, 2001, the Third Division of the Sandiganbayan issued
warrants of arrest against Estrada, his son Jinggoy, Charlie "Atong"
Ang, Edward Serapio, Yolanda Ricaforte, Alma Alfaro, Eleuterio Tan
and Delia Rajas.2 Emotions ran high as an estimated 10,000 Estrada
loyalists, ranging from tattooed teenagers of Tondo to well-heeled
Chinese, gathered in Estrada's neighborhood. 3 Supporters turned
hysterical. Newspapers captured pictures of raging men and wailing
women.4 When policemen came, riots erupted. Police had to use their
batons as well as water hoses to control the rock-throwing Estrada
loyalists.5
It took the authorities about four hours to implement the warrant of
arrest. At about 3:30 o'clock in the afternoon of the same day,
Philippine National Police (PNP) Chief, Director General Leandro R.
Mendoza, with the aid of PNP's Special Action Force and
reinforcements from the Philippine Army and Marines, implemented the
warrant of arrest against Estrada. 6
Like a common criminal, Estrada was fingerprinted and had his mug
shots taken at the detention center of the former Presidential Anti-
Organized Task Force at Camp Crame. The shabby treatment, caught
on live TV cameras nationwide, had sparked off a wave of protest all
over the country. Even international news agencies like CNN and BBC
were appalled over the manner of Estrada's arrest calling it "overkill." In
a taped message aired over radio and television, Estrada defended
himself and said, "I followed the rule of law to the letter. I asked our
people now to tell the powers to respect our constitution and the rule of
law."
Being loyal to the end, the supporters of Estrada followed him to Camp
Crame. About 3,000 of them massed up in front of the camp. They
were shouting "Edsa Three! Edsa Three! They vowed not to leave the
place until Estrada is released. When asked how long they planned to
stay, the protesters said, "Kahit isang buwan, kahit isang taon.7
At about 6:00 o' clock in the afternoon, also of the same day, the PNP's
anti-riot squads dispersed them. Thus, they proceeded to the Edsa
Shrine in Mandaluyong City where they joined forces with hundreds
more who came from North Greenhills. 8 Hordes of Estrada loyalists
began gathering at the historic shrine.
On April 27, 2001, the crowd at Edsa begun to swell in great
magnitude. Estrada loyalists from various sectors, most of them
obviously belonging to the "masses," brought with them placards and
streamers denouncing the manner of arrest done to the former
president.9 In the afternoon, buses loaded with loyalists from the nearby
provinces arrived at the Edsa Shrine. One of their leaders said that the
Estrada supporters will stay at Edsa Shrine until the former president
gets justice from the present administration.10
An estimated 1,500 PNP personnel from the different parts of the
metropolis were deployed to secure the area. 11 On April 28, 2001, the
PNP and the Armed Forces declared a "nationwide red alert." 12
Counter-intelligence agents checked on possible defectors from the
military top officials. Several senators were linked to an alleged junta
plot.
During the rally, several Puwersa Ng Masa candidates delivered
speeches before the crowd. Among those who showed up at the rally
were Senators Miriam Defensor-Santiago, Gregorio Honasan, Juan
Ponce Enrile, Edgardo Angara, Vicente Sotto and former PNP Director
General Panfilo Lacson and former Ambassador Ernesto Maceda. 13
On April 30, 2001, the government started to prepare its forces. A
2,000-strong military force backed up by helicopter gunships, Scorpion
tanks and armored combat vehicles stood ready to counter any attempt
by Estrada loyalists to mount a coup. And to show that it meant
business, the task force parked two MG-520 attack helicopters armed
to the teeth with rockets on the parade ground at Camp Aguinaldo,
Quezon City. Also deployed were two armored personnel carriers and
troops in camouflage uniforms. 14 Over 2,500 soldiers from the army,
navy, and air force were formed into Task Force Libra to quell the
indignant Estrada loyalists.15
On May 1, 2001, at about 1:30 o'clock in the morning, the huge crowd
at Edsa started their march to Malacañang. 16 Along the way, they
overran the barricades set up by the members of the PNP Crowd
Dispersal Control Management.17
Shortly past 5:00 o'clock in the morning of the same day, the marchers
were at the gates of Malacañang chanting, dancing, singing and waving
flags.18
At around 10:00 o'clock in the morning, the police, with the assistance
of combat-ready soldiers, conducted dispersal operations. Some
members of the dispersal team were unceasingly firing their high-
powered firearms in the air, while the police, armed with truncheons
and shields, were slowly pushing the protesters away from the gates of
Malacañang. Television footages showed protesters hurling stones and
rocks on the advancing policemen, shouting invectives against them
and attacking them with clubs. They burned police cars, a motorcycle,
three pick-ups owned by a television station, construction equipment
and a traffic police outpost along Mendiola Street. 19 They also attacked
Red Cross vans, destroyed traffic lights, and vandalized standing
structures. Policemen were seen clubbing protesters, hurling back
stones, throwing teargas under the fierce midday sun, and firing guns
towards the sky. National Security Adviser Roilo Golez said the Street
had to be bleared of rioters at all costs because "this is like an arrow, a
dagger going all the way to (Malacañang) Gate 7."20
Before noontime of that same day, the Estrada loyalists were driven
away.
The violent street clashes prompted President Macapagal-Arroyo to
place Metro Manila under a "state of rebellion."
Presidential Spokesperson Rigoberto Tiglao told reporters, "We are in
a state of rebellion. This is not an ordinary demonstration."21 After the
declaration, there were threats of arrests against those suspected of
instigating the march to Malacañang.
At about 3:30 o'clock in the afternoon, Senator Juan Ponce Enrile was
arrested in his house in Dasmariñas Village, Makati City by a group led
by Reynaldo Berroya, Chief of the Philippine National Police
Intelligence Group.22 Thereafter, Berroya and his men proceeded to
hunt re-electionist Senator Gregorio Honasan, former PNP Chief
Panfilo Lacson, former Ambassador Ernesto Maceda, Brig. Gen. Jake
Malajakan, Senior Superintendents Michael Ray Aquino and Cesar
Mancao II, Ronald Lumbao and Cesar Tanega of the People's
Movement Against Poverty (PMAP).23 Justice Secretary Hernando
Perez said that he was "studying" the possibility of placing Senator
Miriam Defensor – Santiago "under the Witness protection program."
Director Victor Batac,24 former Chief of the PNP Directorate for Police
Community Relations, and Senior Superintendent Diosdado Valeroso,
of the Philippine Center for Transnational Crime, surrendered to
Berroya. Both denied having plotted the siege.
On May 2, 2001, former Ambassador Ernesto Maceda was arrested.
The above scenario presents three crucial queries: First, is President
Macapagal-Arroyo's declaration of a "state of rebellion" constitutional?
Second, was the implementation of the warrantless arrests on the
basis of the declaration of a "state of rebellion" constitutional? And
third, did the rallyists commit rebellion at the vicinity of Malacañang
Palace on May 1, 2001?
The first and second queries involve constitutional issues, hence, the
basic yardstick is the 1987 Constitution of the Philippines. The third
query requires a factual analysis of the events which culminated in the
declaration of a state of rebellion, hence, an examination of Article 134
of the Revised Penal Code is in order.
On May 7, 2001, President Macapagal-Arroyo issued Proclamation No.
39, "DECLARING THAT THE STATE OF REBELLION IN THE
NATIONAL CAPITAL REGION HAS CEASED TO EXIST", which in
effect, has lifted the previous Proclamation No. 38.
I beg to disagree with the majority opinion in ruling that the instant
petitions have been rendered moot and academic with the lifting by the
President of the declaration of a "state of rebellion".
I believe that such lifting should not render moot and academic the very
serious and unprecedented constitutional issues at hand, considering
their grave implications involving the basic human rights and civil
liberties of our people. A resolution of these issues becomes all the
more necessary since, as reported in the papers, there are saturation
drives (sonas) being conducted by the police wherein individuals in
Metro Manila are picked up without warrants of arrest.
Moreover, the acts sought to be declared illegal and unconstitutional
are capable of being repeated by the respondents. In Salva v.
Makalintat (G.R. No. 132603, Sept. 18, 2000), this Court held that
"courts will decide a question otherwise moot and academic if it is
'capable of repetition, yet evading review' …"
I & II – President Macapagal-Arroyo's declaration of a "state of
rebellion" and the implementation of the warrantless arrests
premised on the said declaration are unconstitutional.
Nowhere in the Constitution can be found a provision which grants
upon the executive the power to declare a "state of rebellion," much
more, to exercise on the basis of such declaration the prerogatives
which a president may validly do under a state of martial law.
President-Macapagal-Arroyo committed a constitutional short cut. She
disregarded the clear provisions of the Constitution which provide:
"Sec. 18. The President shall be the Commander-in-Chief of
all armed forces of the Philippines and whenever it becomes
necessary, he may call out such armed forces to prevent or
suppress lawless violence, invasion or rebellion. In case of
invasion or rebellion, when the public safety requires it, he
may, for a period not exceeding sixty days, suspend the
privilege of the writ of habeas corpus or place the Philippines
or any part thereof under martial law. Within forty-eight hours
from the proclamation of martial law or the suspension of the
privilege of the writ of habeas corpus, the President shall
submit a report in person or in writing to the Congress. The
Congress, voting jointly, by a vote of at least a majority of all
its Members in regular or special session, may revoke such
proclamation or suspension, which revocation shall not be set
aside by the President. Upon the initiative of the President,
the Congress may, in the same manner, extend such
proclamation or suspension for a period to be determined by
the Congress, if the invasion or rebellion shall persist and
public safety requires it.
The Congress, if not in session, shall within twenty-four hours
following such proclamation or suspension, convene in
accordance with its rules without need of a call.
The Supreme Court may review, in an appropriate proceeding
filed by any citizen, the sufficiency of the factual bases of the
proclamation of martial law or the suspension of the privilege
of the writ or the extension thereof, and must promulgate its
decision thereon within thirty days from its filing.
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or
legislative assemblies, nor authorize the conferment of
jurisdiction on military courts and agencies over civilians
where civil courts are able to function, nor automatically
suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to
persons judicially charged for rebellion or offenses inherent in
or directly connected with invasion.
During the suspension of the privilege of the writ, any person
thus arrested or detained shall be judicially charged within
three days, otherwise he shall be released."25
Obviously, the power of the President in cases when she assumed the
existence of rebellion is properly laid down by the Constitution. I see no
reason or justification for the President's deviation from the concise and
plain provisions. To accept the theory that the President could
disregard the applicable statutes, particularly that which concerns
arrests, searches and seizures, on the mere declaration of a "state of
rebellion" is in effect to place the Philippines under martial law
without a declaration of the executive to that effect and without
observing the proper procedure. This should not be countenanced.
In a society which adheres to the rule of law, resort to extra-
constitutional measures is unnecessary where the law has provided
everything for any emergency or contingency. For even if it may be
proven beneficial for a time, the precedent it sets is pernicious as the
law may, in a little while, be disregarded again on the same pretext but
for evil purposes. Even in time of emergency, government action
may vary in breath and intensity from more normal times, yet it
need not be less constitutional.26
My fear is rooted in history. Our nation had seen the rise of a dictator
into power. As a matter of fact, the changes made by the 1986
Constitutional Commission on the martial law text of the Constitution
were to a large extent a reaction against the direction which the
Supreme Court took during the regime of President Marcos. 27 Now, if
this Court would take a liberal view, and consider that the declaration of
a "state of rebellion" carries with it the prerogatives given to the
President during a "state of martial law," then, I say, the Court is
traversing a very dangerous path. It will open the way to those who, in
the end, would turn our democracy into a totalitarian rule. History must
not be allowed to repeat itself. Any act which gears towards possible
dictatorship must be severed at its inception.
The implementation of warrantless arrests premised on the declaration
of a "state of rebellion" is unconstitutional and contrary to existing laws.
The Constitution provides that "the right of the people to be secure in
their persons, houses, papers and effects against unreasonable
searches and seizure of whatever nature and for any purpose shall be
inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge
after examination under oath or affirmation of the complainant and the
witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized." 28 If a state of martial
law "does not suspend the operation of the Constitution, nor supplant
the functioning of the civil courts or legislative assemblies, nor authorize
the conferment of jurisdiction on military courts and agencies over
civilians, where civil courts are able to function, nor automatically
suspend the privilege of the writ,"28(a) then it is with more reason, that a
mere declaration of a state of rebellion could not bring about the
suspension of the operation of the Constitution or of the writ of habeas
corpus.
Neither can we find the implementation of the warrantless arrests
justified under the Revised Rules on Criminal Procedure. Pertinent is
Section 5, Rule 113, thus:
"Sec. 5. Arrest without warrant, when lawful. – A peace
officer or a private person may, without a warrant, arrest a
person:
(a) When, in his presence, the person to be arrested has
committed, is actually committing, or is attempting to commit
an offense.
(b) When an offense has just been committed and he has
probable cause to believe based on personal knowledge of
facts and circumstances that the person to be arrested has
committed it; and
x x x."
Petitioners cannot be considered "to have committed, is actually woods, rocks, sticks or clubs as means to disable the government. It
committing, or is attempting to commit an offense" at the time they were will be extremely pathetic and the result will only be in vain. Unlike a
hunted by Berroya for the implementation of the warrantless arrests. true rebellion which is organized, what happened at the vicinity of
None of them participated in the riot which took place in the vicinity of Malacañang was merely a riot, a mob violence, or a tumultuous
the Malacañang Palace. Some of them were on their respective houses uprising. At this juncture, it bears stressing that the crime of rebellion is
performing innocent acts such as watching television, resting etc. The a vast movement of men and a complex net of intrigues and plots.31 It
sure fact however is that they were not in the presence of Berroya. must be distinguished from riot and offenses connected with mob
Clearly, he did not see whether they had committed, were committing violence. In rebellion/insurrection, there is an organized and armed
or were attempting to commit the crime of rebellion. But of course, I uprising against authority.32
cannot lose sight of the legal implication of President Macapagal- Second, the purpose of the Estrada loyalists was neither (a) to remove
Arroyo's declaration of a "state of rebellion." Rebellion is a continuing from the allegiance to the government or its laws (1) the territory of the
offense and a suspected insurgent or rebel may be arrested anytime as Philippines or any part thereof; or (2) any part of land, naval or other
he is considered to be committing the crime. Nevertheless, assuming armed forces; nor (b) to deprive the Chief Executive or Congress,
ex gratia argumenti that the declaration of a state of rebellion is wholly or partially, of any of their powers or prerogatives. I looked at the
constitutional, it is imperative that the said declaration be reconsidered. chronology of events, and one thing surfaced – the Estrada loyalists
In view of the changing times, the dissenting opinion of the noted jurist, mainly demanded that their beloved "president" should not be
Justice Isagani Cruz, in Umil v. Ramos,29 quoted below must be given a incarcerated. The crowd at Edsa swelled in great magnitude on April
second look. 25, 2001, the day Estrada was arrested. In fact, when they followed
"I dissent insofar as the ponencia affirms the ruling in Garcia- Erap at Camp Crame, they were shouting "Edsa! Edsa! And they
Padilla vs. Enrile that subversion is a continuing offense, to vowed not to leave until Estrada is released."33
justify the arrest without warrant of any person at any time as One must not be swayed by the theory of respondents that the purpose
long as the authorities say he has been placed under of those people who gathered in Edsa and marched to Malacañang
surveillance on suspicion of the offense. That is a dangerous was to commit rebellion. For sure, there were a thousand and one
doctrine. A person may be arrested when he is doing the most reasons why they proceeded to Edsa. In determining their purpose, one
innocent acts, as when he is only washing his hands, or must trace the roots, - what prompted them to go to Edsa? They were
taking his supper, or even when he is sleeping, on the ground the Estrada loyalists who wanted him to be freed. If indeed there were
that he is committing the 'continuing' offense of subversion. minorities who advocated another cause, the same should not be
Libertarians were appalled when that doctrine was imposed considered as the prevailing one in the determination of what crime was
during the Marcos regime. I am alarmed that even now this committed. Facts should not be stretched just to build a case of
new Court is willing to sustain it. I strongly urge my colleagues rebellion. This runs counter to the principle of due process.
to discard it altogether as one of the disgraceful vestiges of
As a final word, I subscribe to the principle that the rule of law implies
the past dictatorship and uphold the rule guaranteeing the
the precept that similar cases be treated similarly. Men can not regulate
right of the people against unreasonable searches and
their actions by means of rule if this precept is not followed. Edsa I,
seizures. We can do no less if we are really to reject the past
Edsa II and Edsa III are all public uprisings. Statements urging people
oppression and commit ourselves to the true freedom. Even if
to overthrow the government were uttered in all these occasions.
it be argued that the military should be given every support in
Injuries were sustained, policemen were attacked, standing structures
our fight against subversion, I maintain that fight must be
were vandalized… in all these scenarios, one cannot be said to be
waged honorably, in accordance with the Bill of Rights. I do
extremely away from the other. The only difference is that the first two
not believe that in fighting the enemy we must adopt the ways
succeeded, while the last failed. This should not result to an unbridled
of the enemy, which are precisely what we are fighting
or unlimited exercise of power by the duly constituted authorities. It is
against. I submit that our more important motivation should be
during these trying times that fealty to the Constitution is strongly
what are we fighting for."
demanded from all, especially the authorities concerned.1âwphi1.nêt
I need not belabor that at the time some of the suspected instigators
WHEREFORE, I vote to give DUE COURSE to the petitions and
were arrested, (the others are still at-large), a long interval of time
GRANT the same and to enjoin the respondents from arresting the
already passed and hence, it cannot be legally said that they had just
petitioners in G.R. Nos. 147780, 147781, and 147799 without the
committed an offense. Neither can it be said that Berroya or any of his
corresponding warrants.
men had "personal knowledge of facts or circumstances that the
persons to be arrested have committed a crime." That would be far SO ORDERED.1âwphi1.nêt
from reality.
III – The acts of the rallyists at the vicinity of Malacañang Palace
on May 1, 2001 do not constitute rebellion.
Article 134 of the Revised Penal Code reads:
"ART. 134. Rebellion or insurrection – How committed. – The
crime of rebellion or insurrection is committed by rising
publicly and taking arms against the Government for the
purpose of removing from the allegiance to said Government
or its laws, the territory of the Republic of the Philippines or
any part thereof, of any body of land, naval or other armed
forces, or depriving the Chief Executive or the Legislature,
wholly or partially, of any of their powers or prerogatives." (As
amended by RA No. 6968, O.G. 52, p. 9864, 1990)
From the foregoing provisions, the elements o the crime of rebellion
may be deduced, thus: first, that there be (a) public uprising and (b)
taking arms against the government; second, that the purpose of the
uprising or movement is either (a) to remove from the allegiance to said
government or its laws (1) the territory of the Philippines or any part
thereof; or (2) anybody of land, naval or other armed forces; or (b) to
deprive the Chief Executive or Congress, wholly or partially, of any of
their powers or prerogatives.30
Looking at the events on a magnified scale, I am convinced that the two
elements of the crime of rebellion are lacking.
First, there was no "taking of arms" against the government. To my
mind, "taking arms" connotes the multitude's deliberate and conscious
resort to arms or weapons for the purpose of aiding them in
accomplishing any of the purposes of rebellion. Admittedly, the Estrada
loyalists pelted the policemen with rocks and stones and attacked them
with sticks and clubs, but such was merely a result of the heightening
tension between opposite camps during the period of dispersal. The
stones, rocks, sticks, clubs and other improvised weapons were not
deliberately resorted to by the Estrada loyalists to further any of the
purposes of rebellion. They availed of them, at the precise moment of
dispersal (this explains why their weapons were those which could be
easily gathered on the street) and only for the purpose of stopping the
policemen from dispersing them. In this age of modernity, one who
intends to overthrow the government will not only settle for stones,
G.R. No. 159085           February 3, 2004
SANLAKAS, represented by REP. J.V. Bautista, and PARTIDO NG
MANGGAGAWA, represented by REP. RENATO MAGTUBO
petitioners,
vs
EXECUTIVE SECRETARY SECRETARY ANGELO REYES,
GENERAL NARCISO ABAYA, DIR. GEN. HERMOGENES EBDANE,
respondents.
x------------------------x
G.R. No. 159103           February 3, 2004
SOCIAL JUSTICE SOCIETY (SJS) OFFICERS/MEMBERS namely,
SAMSON S. ALCANTARA, ED VINCENT S. ALBANO, RENE B.
GOROSPE, EDWIN R. SANDOVAL and RODOLFO D. MAPILE,
petitioners,
vs
HON. EXECUTIVE SECRETARY ALBERTO G. ROMULO, HON.
SECRETARY OF JUSTICE SIMEON DATUMANONG, HON.
SECRETARY OF NATIONAL DEFENSE ANGELO REYES, and HON.
SECRETARY JOSE LINA, JR., respondents.
x------------------------x
G.R. No. 159185           February 3, 2004
REP. ROLEX T. SUPLICO, REP. CARLOS M. PADILLA, REP.
CELSO L. LOBREGAT, REP. HUSSIN U. AMIN, REP. ABRAHAM
KAHLIL B. MITRA, REP. EMMYLOU J. TALINO-SANTOS, and REP.
GEORGILU R. YUMUL-HERMIDA, petitioners,
vs
PRESIDENT GLORIA MACAPAGAL-ARROYO; and EXECUTIVE
SECRETARY ALBERTO G. ROMULO, respondents.
x------------------------x
G.R. No. 159196           February 3, 2004
AQUILINO Q. PIMENTEL, JR. as a Member of the Senate, petitioner,
vs
SECRETARY ALBERTO ROMULO, AS EXECUTIVE SECRETARY;
SECRETARY ANGELO REYES, AS SECRETARY OF NATIONAL
DEFENSE; GENERAL NARCISO ABAYA, AS CHIEF OF STAFF OF
THE ARMED FORCES; SECRETARY JOSE LINA, et al.,
respondents.
DECISION
TINGA, J.:
They came in the middle of the night. Armed with high-powered
ammunitions and explosives, some three hundred junior officers and
enlisted men of the Armed Forces of the Philippines (AFP) stormed into
the Oakwood Premiere apartments in Makati City in the wee hours of
July 27, 2003. Bewailing the corruption in the AFP, the soldiers
demanded, among other things, the resignation of the President, the
Secretary of Defense and the Chief of the Philippine National Police
(PNP).1
In the wake of the Oakwood occupation, the President issued later in
the day Proclamation No. 427 and General Order No. 4, both declaring
"a state of rebellion" and calling out the Armed Forces to suppress the
rebellion. Proclamation No. 427 reads in full:
PROCLAMATION NO. 427
DECLARING A STATE OF REBELLION
WHEREAS, certain elements of the Armed Forces of the Philippines,
armed with high-powered firearms and explosives, acting upon the
instigation and command and direction of known and unknown leaders,
have seized a building in Makati City, put bombs in the area, publicly
declared withdrawal of support for, and took arms against the duly
constituted Government, and continue to rise publicly and show open
hostility, for the purpose of removing allegiance to the Government
certain bodies of the Armed Forces of the Philippines and the Philippine
National Police, and depriving the President of the Republic of the
Philippines, wholly or partially, of her powers and prerogatives which
constitute the crime of rebellion punishable under Article 134 of the
Revised Penal Code, as amended;
WHEREAS, these misguided elements of the Armed Forces of the
Philippines are being supported, abetted and aided by known and
unknown leaders, conspirators and plotters in the government service
and outside the government;
WHEREAS, under Section 18, Article VII of the present Constitution,
whenever it becomes necessary, the President, as the Commander-in-
Chief of the Armed Forces of the Philippines, may call out such Armed
Forces to suppress the rebellion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, by virtue of
the powers vested in me by law, hereby confirm the existence of an
actual and on-going rebellion, compelling me to declare a state of
rebellion.
In view of the foregoing, I am issuing General Order No. 4 in
accordance with Section 18, Article VII of the Constitution, calling out
the Armed Forces of the Philippines and the Philippine National Police
to immediately carry out the necessary actions and measures to
suppress and quell the rebellion with due regard to constitutional rights.
General Order No. 4 is similarly worded:
GENERAL ORDER NO. 4
DIRECTING THE ARMED FORCES OF THE PHILIPPINES AND THE
PHILIPPINE NATIONAL POLICE TO SUPPRESS REBELLION
WHEREAS, certain elements of the Armed Forces of the Philippines,
armed with high-powered firearms and explosives, acting upon the
instigation and command and direction of known and unknown leaders,
have seized a building in Makati City, put bombs in the area, publicly
declared withdrawal of support for, and took arms against the duly
constituted Government, and continue to rise publicly and show open
hostility, for the purpose of removing allegiance to the Government
certain bodies of the Armed Forces of the Philippines and the Philippine
National Police, and depriving the President of the Republic of the
Philippines, wholly or partially, of her powers and prerogatives which
constitute the crime of rebellion punishable under Article 134 et seq. of
the Revised Penal Code, as amended;
WHEREAS, these misguided elements of the Armed Forces of the
Philippines are being supported, abetted and aided by known and
unknown leaders, conspirators and plotters in the government service
and outside the government;
WHEREAS, under Section 18, Article VII of the present Constitution,
whenever it becomes necessary, the President, as the Commander-in-
Chief of all Armed Forces of the Philippines, may call out such Armed
Forces to suppress the rebellion;
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, by virtue of
the powers vested in me by the Constitution as President of the
Republic of the Philippines and Commander-in-Chief of all the armed
forces of the Philippines and pursuant to Proclamation No. 427 dated
July 27, 2003, do hereby call upon the Armed Forces of the Philippines
and the Philippine National Police to suppress and quell the rebellion.
I hereby direct the Chief of the Armed Forces of the Philippines and the
Chief of the Philippine National Police and the officers and men of the
Armed Forces of the Philippines and the Philippine National Police to
immediately carry out the necessary and appropriate actions and
measures to suppress and quell the rebellion with due regard to
constitutional rights.
By the evening of July 27, 2003, the Oakwood occupation had ended.
After hours-long negotiations, the soldiers agreed to return to barracks.
The President, however, did not immediately lift the declaration of a
state of rebellion and did so only on August 1, 2003, through
Proclamation No. 435:
DECLARING THAT THE STATE OF REBELLION HAS CEASED TO
EXIST
WHEREAS, by virtue of Proclamation No. 427 dated July 27, 2003, a
state of rebellion was declared;
WHEREAS, by virtue of General Order No. 4 dated July 27, 2003,
which was issued on the basis of Proclamation No. 427 dated July 27,
2003, and pursuant to Article VII, Section 18 of the Constitution, the
Armed Forces of the Philippines and the Philippine National Police
were directed to suppress and quell the rebellion;
WHEREAS, the Armed Forces of the Philippines and the Philippine
National Police have effectively suppressed and quelled the rebellion.
NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of
the Philippines, by virtue of the powers vested in me by law, hereby
declare that the state of rebellion has ceased to exist.
In the interim, several petitions were filed before this Court challenging
the validity of Proclamation No. 427 and General Order No. 4.
In G.R. No. 159085 (Sanlakas and PM v. Executive Secretary, et al.),2
party-list organizations Sanlakas and Partido ng Manggagawa (PM),
contend that Section 18, Article VII of the Constitution does not require
the declaration of a state of rebellion to call out the armed forces. 3 They
further submit that, because of the cessation of the Oakwood
occupation, there exists no sufficient factual basis for the proclamation
by the President of a state of rebellion for an indefinite period. 4
Petitioners in G.R. No. 159103 (SJS Officers/Members v. Hon.
Executive Secretary, et al.) are officers/members of the Social Justice
Society (SJS), "Filipino citizens, taxpayers, law professors and bar
reviewers."5 Like Sanlakas and PM, they claim that Section 18, Article
VII of the Constitution does not authorize the declaration of a state of
rebellion.6 They contend that the declaration is a "constitutional
anomaly" that "confuses, confounds and misleads" because
"[o]verzealous public officers, acting pursuant to such proclamation or
general order, are liable to violate the constitutional right of private
citizens."7 Petitioners also submit that the proclamation is a
circumvention of the report requirement under the same Section 18,
Article VII, commanding the President to submit a report to Congress
within 48 hours from the proclamation of martial law. 8 Finally, they
contend that the presidential issuances cannot be construed as an
exercise of emergency powers as Congress has not delegated any
such power to the President.9
In G.R. No. 159185 (Rep. Suplico et al. v. President Macapagal-Arroyo
and Executive Secretary Romulo), petitioners brought suit as citizens
and as Members of the House of Representatives whose rights, powers
and functions were allegedly affected by the declaration of a state of
rebellion.10 Petitioners do not challenge the power of the President to
call out the Armed Forces. 11 They argue, however, that the declaration
of a state of rebellion is a "superfluity," and is actually an exercise of
emergency powers.12 Such exercise, it is contended, amounts to a
usurpation of the power of Congress granted by Section 23 (2), Article
VI of the Constitution.13
In G.R. No. 159196 (Pimentel v. Romulo, et al.), petitioner Senator
assails the subject presidential issuances as "an unwarranted, illegal
and abusive exercise of a martial law power that has no basis under the
Constitution."14 In the main, petitioner fears that the declaration of a
state of rebellion "opens the door to the unconstitutional implementation
of warrantless arrests" for the crime of rebellion. 15
Required to comment, the Solicitor General argues that the petitions
have been rendered moot by the lifting of the declaration. 16 In addition,
the Solicitor General questions the standing of the petitioners to bring
suit.17
The Court agrees with the Solicitor General that the issuance of
Proclamation No. 435, declaring that the state of rebellion has ceased
to exist, has rendered the case moot. As a rule, courts do not
adjudicate moot cases, judicial power being limited to the determination
of "actual controversies."18 Nevertheless, courts will decide a question,
otherwise moot, if it is "capable of repetition yet evading review." 19 The
case at bar is one such case.
Once before, the President on May 1, 2001 declared a state of rebellion
and called upon the AFP and the PNP to suppress the rebellion through
Proclamation No. 38 and General Order No. 1. On that occasion, "'an
angry and violent mob armed with explosives, firearms, bladed
weapons, clubs, stones and other deadly weapons' assaulted and
attempted to break into Malacañang." 20 Petitions were filed before this
Court assailing the validity of the President's declaration. Five days
after such declaration, however, the President lifted the same. The
mootness of the petitions in Lacson v. Perez and accompanying
cases21 precluded this Court from addressing the constitutionality of the
declaration.
To prevent similar questions from reemerging, we seize this opportunity
to finally lay to rest the validity of the declaration of a state of rebellion
in the exercise of the President's calling out power, the mootness of the
petitions notwithstanding.
Only petitioners Rep. Suplico et al. and Sen. Pimentel, as Members of
Congress, have standing to challenge the subject issuances. In
Philippine Constitution Association v. Enriquez,22 this Court recognized
that:
To the extent the powers of Congress are impaired, so is the
power of each member thereof, since his office confers a right
to participate in the exercise of the powers of that institution.
An act of the Executive which injures the institution of
Congress causes a derivative but nonetheless substantial
injury, which can be questioned by a member of Congress. In
such a case, any member of Congress can have a resort to
the courts.
Petitioner Members of Congress claim that the declaration of
a state of rebellion by the President is tantamount to an
exercise of Congress' emergency powers, thus impairing the
lawmakers' legislative powers. Petitioners also maintain that
the declaration is a subterfuge to avoid congressional scrutiny
into the President's exercise of martial law powers.
Petitioners Sanlakas and PM, and SJS Officers/Members,
have no legal standing or locus standi to bring suit. "Legal
standing" or locus standi has been defined as a personal and
substantial interest in the case such that the party has
sustained or will sustain direct injury as a result of the
governmental act that is being challenged…. The gist of the
question of standing is whether a party alleges "such personal
stake in the outcome of the controversy as to assure that
concrete adverseness which sharpens the presentation of
issues upon which the court depends for illumination of
difficult constitutional questions."23
Petitioners Sanlakas and PM assert that:
2. As a basic principle of the organizations and as an
important plank in their programs, petitioners are committed to
assert, defend, protect, uphold, and promote the rights,
interests, and welfare of the people, especially the poor and
marginalized classes and sectors of Philippine society.
Petitioners are committed to defend and assert human rights,
including political and civil rights, of the citizens.
3. Members of the petitioner organizations resort to mass
actions and mobilizations in the exercise of their
Constitutional rights to peaceably assemble and their freedom
of speech and of expression under Section 4, Article III of
the 1987 Constitution, as a vehicle to publicly ventilate their
grievances and legitimate demands and to mobilize public
opinion to support the same.24 [Emphasis in the original.]
Petitioner party-list organizations claim no better right than the Laban
ng Demokratikong Pilipino, whose standing this Court rejected in
Lacson v. Perez:
… petitioner has not demonstrated any injury to itself which
would justify the resort to the Court. Petitioner is a juridical
person not subject to arrest. Thus, it cannot claim to be
threatened by a warrantless arrest. Nor is it alleged that its
leaders, members, and supporters are being threatened with
warrantless arrest and detention for the crime of rebellion.
Every action must be brought in the name of the party whose
legal rights has been invaded or infringed, or whose legal right
is under imminent threat of invasion or infringement.
At best, the instant petition may be considered as an action
for declaratory relief, petitioner claiming that it[']s right to
freedom of expression and freedom of assembly is affected
by the declaration of a "state of rebellion" and that said
proclamation is invalid for being contrary to the Constitution.
However, to consider the petition as one for declaratory relief
affords little comfort to petitioner, this Court not having
jurisdiction in the first instance over such a petition. Section 5
[1], Article VIII of the Constitution limits the original jurisdiction
of the court to cases affecting ambassadors, other public
ministers and consuls, and over petitions for certiorari,
prohibition, mandamus, quo warranto, and habeas corpus.25
Even assuming that petitioners are "people's organizations," this status
would not vest them with the requisite personality to question the
validity of the presidential issuances, as this Court made clear in
Kilosbayan v. Morato:26
The Constitution provides that "the State shall respect the role
of independent people's organizations to enable the people to
pursue and protect, within the democratic framework, their
legitimate and collective interests and aspirations through
peaceful and lawful means," that their right to "effective and
reasonable participation at all levels of social, political, and
economic decision-making shall not be abridged." (Art. XIII,
§§15-16)
These provisions have not changed the traditional rule that
only real parties in interest or those with standing, as the case
may be, may invoke the judicial power. The jurisdiction of this
Court, even in cases involving constitutional questions, is
limited by the "case and controversy" requirement of Art. VIII,
§5. This requirement lies at the very heart of the judicial
function. It is what differentiates decisionmaking in the courts
from decisionmaking in the political departments of the
government and bars the bringing of suits by just any party. 27
That petitioner SJS officers/members are taxpayers and citizens does
not necessarily endow them with standing. A taxpayer may bring suit
where the act complained of directly involves the illegal disbursement of
public funds derived from taxation. 28 No such illegal disbursement is
alleged.
On the other hand, a citizen will be allowed to raise a constitutional
question only when he can show that he has personally suffered some
actual or threatened injury as a result of the allegedly illegal conduct of
the government; the injury is fairly traceable to the challenged action;
and the injury is likely to be redressed by a favorable action. 29 Again, no
such injury is alleged in this case.
Even granting these petitioners have standing on the ground that the
issues they raise are of transcendental importance, the petitions must
fail.
It is true that for the purpose of exercising the calling out power the
Constitution does not require the President to make a declaration of a
state of rebellion. Section 18, Article VII provides:
Sec. 18. The President shall be the Commander-in-Chief of all
armed forces of the Philippines and whenever it becomes
necessary, he may call out such armed forces to prevent
or suppress lawless violence, invasion or rebellion. In
case of invasion or rebellion, when the public safety requires
it, he may, for a period not exceeding sixty days, suspend the
privilege of the writ of habeas corpus or place the Philippines
or any part thereof under martial law. Within forty-eight hours
from the proclamation of martial law or the suspension of the
writ of habeas corpus, the President shall submit a report in
person or in writing to the Congress. The Congress, voting
jointly, by a vote of at least a majority of all its Members in
regular or special session, may revoke such proclamation or
suspension, which revocation shall not be set aside by the
President. Upon the initiative of the President, the Congress
may, in the same manner, extend such proclamation or
suspension for a period to be determined by the Congress, if
the invasion or rebellion shall persist and public safety
requires it.
 The Congress, if not in session, shall, within twenty-four hours
following such proclamation or suspension, convene in
accordance with its rules without need of a call.
The Supreme Court may review, in an appropriate proceeding
filed by any citizen, the sufficiency of the factual basis for the
proclamation of martial law or the suspension of the privilege
of the writ of habeas corpus or the extension thereof, and
must promulgate its decision thereon within thirty days from
its filing.
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or
legislative assemblies, nor authorize the conferment of the
jurisdiction on military courts and agencies over civilians
where civil courts are able to function, nor automatically
suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to
persons judicially charged for rebellion or offenses inherent in
or directly connected with invasion.
During the suspension of the privilege of the writ, any person
thus arrested or detained shall be judicially charged within
three days, otherwise he shall be released. [Emphasis
supplied.]
The above provision grants the President, as Commander-in-Chief, a
"sequence" of "graduated power[s]."30 From the most to the least
benign, these are: the calling out power, the power to suspend the
privilege of the writ of habeas corpus, and the power to declare martial
law. In the exercise of the latter two powers, the Constitution requires
the concurrence of two conditions, namely, an actual invasion or
rebellion, and that public safety requires the exercise of such power. 31
However, as we observed in Integrated Bar of the Philippines v.
Zamora,32 "[t]hese conditions are not required in the exercise of the
calling out power. The only criterion is that 'whenever it becomes
necessary,' the President may call the armed forces 'to prevent or
suppress lawless violence, invasion or rebellion.'"
Nevertheless, it is equally true that Section 18, Article VII does not
expressly prohibit the President from declaring a state of rebellion. Note
that the Constitution vests the President not only with Commander-in-
Chief powers but, first and foremost, with Executive powers.
Section 1, Article VII of the 1987 Philippine Constitution states: "The
executive power shall be vested in the President…." As if by exposition,
Section 17 of the same Article provides: "He shall ensure that the laws
be faithfully executed." The provisions trace their history to the
Constitution of the United States.
The specific provisions of the U.S. Constitution granting the U.S.
President executive and commander-in-chief powers have remained in
their original simple form since the Philadelphia Constitution of 1776,
Article II of which states in part:
Section 1. 1. The Executive Power shall be vested in a
President of the United States of America . . . .
....
Section 2. 1. The President shall be Commander in Chief of
the Army and Navy of the United States. . . .
....
Section 3. … he shall take care that the laws be faithfully
executed…. [Article II – Executive Power]
Recalling in historical vignettes the use by the U.S. President of the
above-quoted provisions, as juxtaposed against the corresponding
action of the U.S. Supreme Court, is instructive. Clad with the
prerogatives of the office and endowed with sovereign powers, which
are drawn chiefly from the Executive Power and Commander-in-Chief
provisions, as well as the presidential oath of office, the President
serves as Chief of State or Chief of Government, Commander-in-Chief,
Chief of Foreign Relations and Chief of Public Opinion. 33
First to find definitive new piers for the authority of the Chief of State, as
the protector of the people, was President Andrew Jackson. Coming to
office by virtue of a political revolution, Jackson, as President not only
kept faith with the people by driving the patricians from power. Old
Hickory, as he was fondly called, was the first President to champion
the indissolubility of the Union by defeating South Carolina's nullification
effort.34
The Federal Tariff Acts of 1828 and 1832 that Congress enacted did
not pacify the hotspurs from South Carolina. Its State Legislature
ordered an election for a convention, whose members quickly passed
an Ordinance of Nullification. The Ordinance declared the Tariff Acts
unconstitutional, prohibited South Carolina citizens from obeying them
after a certain date in 1833, and threatened secession if the Federal
Government sought to oppose the tariff laws. The Legislature then
implemented the Ordinance with bristling punitive laws aimed at any
who sought to pay or collect customs duties.35
Jackson bided his time. His task of enforcement would not be easy.
Technically, the President might send troops into a State only if the
Governor called for help to suppress an insurrection, which would not
occur in the instance. The President could also send troops to see to it
that the laws enacted by Congress were faithfully executed. But these
laws were aimed at individual citizens, and provided no enforcement
machinery against violation by a State. Jackson prepared to ask
Congress for a force bill.36
In a letter to a friend, the President gave the essence of his position. He
wrote: ". . . when a faction in a State attempts to nullify a constitutional
law of Congress, or to destroy the Union, the balance of the people
composing this Union have a perfect right to coerce them to
obedience." Then in a Proclamation he issued on December 10, 1832,
he called upon South Carolinians to realize that there could be no
peaceable interference with the execution of the laws, and dared them,
"disunion by armed force is treason. Are you ready to incur its guilt?"37
The Proclamation frightened nullifiers, non-nullifiers and tight-rope
walkers. Soon, State Legislatures began to adopt resolutions of
agreement, and the President announced that the national voice from
Maine on the north to Louisiana on the south had declared nullification
and accession "confined to contempt and infamy."38
No other President entered office faced with problems so formidable,
and enfeebled by personal and political handicaps so daunting, as
Abraham Lincoln.
Lincoln believed the President's power broad and that of Congress
explicit and restricted, and sought some source of executive power not
failed by misuse or wrecked by sabotage. He seized upon the
President's designation by the Constitution as Commander-in-Chief,
coupled it to the executive power provision — and joined them as "the
war power" which authorized him to do many things beyond the
competence of Congress.39
Lincoln embraced the Jackson concept of the President's independent
power and duty under his oath directly to represent and protect the
people. In his Message of July 4, 1861, Lincoln declared that "the
Executive found the duty of employing the war power in defense of the
government forced upon him. He could not but perform the duty or
surrender the existence of the Government . . . ." This concept began
as a transition device, to be validated by Congress when it assembled.
In less than two-years, it grew into an independent power under which
he felt authorized to suspend the privilege of the writ of habeas corpus,
issue the Emancipation Proclamation, and restore reoccupied States. 40
Lincoln's Proclamation of April 15, 1861, called for 75,000 troops. Their
first service, according to the proclamation, would be to recapture forts,
places and property, taking care "to avoid any devastation, any
destruction of or interference with property, or any disturbance of
peaceful citizens."41
Early in 1863, the U.S. Supreme Court approved President Lincoln's
report to use the war powers without the benefit of Congress. The
decision was handed in the celebrated Prize Cases42 which involved
suits attacking the President's right to legally institute a blockade.
Although his Proclamation was subsequently validated by Congress,
the claimants contended that under international law, a blockade could
be instituted only as a measure of war under the sovereign power of the
State. Since under the Constitution only Congress is exclusively
empowered to declare war, it is only that body that could impose a
blockade and all prizes seized before the legislative declaration were
illegal. By a 5 to 4 vote, the Supreme Court upheld Lincoln's right to act
as he had.43
In the course of time, the U.S. President's power to call out armed
forces and suspend the privilege of the writ of habeas corpus without
prior legislative approval, in case of invasion, insurrection, or rebellion
came to be recognized and accepted. The United States introduced the
expanded presidential powers in the Philippines through the Philippine
Bill of 1902.44 The use of the power was put to judicial test and this
Court held that the case raised a political question and said that it is
beyond its province to inquire into the exercise of the power. 45 Later, the
grant of the power was incorporated in the 1935 Constitution.46
Elected in 1884, Grover Cleveland took his ascent to the presidency to
mean that it made him the trustee of all the people. Guided by the
maxim that "Public office is a public trust," which he practiced during his
incumbency, Cleveland sent federal troops to Illinois to quell striking
railway workers who defied a court injunction. The injunction banned all
picketing and distribution of handbills. For leading the strikes and
violating the injunction, Debs, who was the union president, was
convicted of contempt of court. Brought to the Supreme Court, the
principal issue was by what authority of the Constitution or statute had
the President to send troops without the request of the Governor of the
State.47
In In Re: Eugene Debs, et al,48 the Supreme Court upheld the contempt
conviction. It ruled that it is not the government's province to mix in
merely individual present controversies. Still, so it went on, "whenever
wrongs complained of are such as affect the public at large, and are in
respect of matters which by the Constitution are entrusted to the care of
the Nation and concerning which the Nation owes the duty to all
citizens of securing to them their common rights, then the mere fact that
the Government has no pecuniary interest in the controversy is not
sufficient to exclude it from the Courts, or prevent it from taking
measures therein to fully discharge those constitutional duties." 49 Thus,
Cleveland's course had the Court's attest.
Taking off from President Cleveland, President Theodore Roosevelt
launched what political scientists dub the "stewardship theory." Calling
himself "the steward of the people," he felt that the executive power
"was limited only by the specific restrictions and prohibitions appearing
in the Constitution, or impleaded by Congress under its constitutional
powers."50
The most far-reaching extension of presidential power "T.R." ever
undertook to employ was his plan to occupy and operate
Pennsylvania's coal mines under his authority as Commander-in-Chief.
In the issue, he found means other than force to end the 1902 hard-
coal strike, but he had made detailed plans to use his power as
Commander-in-Chief to wrest the mines from the stubborn operators,
so that coal production would begin again.51
Eventually, the power of the State to intervene in and even take over
the operation of vital utilities in the public interest was accepted. In the
Philippines, this led to the incorporation of Section 6, 52 Article XIII of the
1935 Constitution, which was later carried over with modifications in
Section 7,53 Article XIV of the 1973 Constitution, and thereafter in
Section 18,54 Article XII of the 1987 Constitution.
The lesson to be learned from the U.S. constitutional history is that the
Commander-in-Chief powers are broad enough as it is and become
more so when taken together with the provision on executive power
and the presidential oath of office. Thus, the plenitude of the powers of
the presidency equips the occupant with the means to address
exigencies or threats which undermine the very existence of
government or the integrity of the State.
In The Philippine Presidency A Study of Executive Power, the late
Mme. Justice Irene R. Cortes, proposed that the Philippine President
was vested with residual power and that this is even greater than that of
the U.S. President. She attributed this distinction to the "unitary and
highly centralized" nature of the Philippine government. She noted that,
"There is no counterpart of the several states of the American union
which have reserved powers under the United States constitution."
Elaborating on the constitutional basis for her argument, she wrote:
…. The [1935] Philippine [C]onstitution establishes the three
departments of the government in this manner: "The
legislative power shall be vested in a Congress of the
Philippines which shall consist of a Senate and a House of
Representatives." "The executive power shall be vested in a
President of the Philippines." The judicial powers shall be
vested in one Supreme Court and in such inferior courts as
may be provided by law." These provisions not only establish
a separation of powers by actual division but also confer
plenary legislative, executive, and judicial powers. For as the
Supreme Court of the Philippines pointed out in Ocampo v.
Cabangis, "a grant of legislative power means a grant of all
the legislative power; and a grant of the judicial power means
a grant of all the judicial power which may be exercised under
the government." If this is true of the legislative power which is
exercised by two chambers with a combined membership [at
that time] of more than 120 and of the judicial power which is
vested in a hierarchy of courts, it can equally if not more
appropriately apply to the executive power which is vested in
one official – the president. He personifies the executive
branch. There is a unity in the executive branch absent from
the two other branches of government. The president is not
the chief of many executives. He is the executive. His
direction of the executive branch can be more immediate and
direct than the United States president because he is given by
express provision of the constitution control over all executive
departments, bureaus and offices.55
The esteemed Justice conducted her study against the backdrop of the
1935 Constitution, the framers of which, early on, arrived at a general
opinion in favor of a strong Executive in the Philippines." 56 Since then,
reeling from the aftermath of martial law, our most recent Charter has
restricted the President's powers as Commander-in-Chief. The same,
however, cannot be said of the President's powers as Chief Executive.
In her ponencia in Marcos v. Manglapus, Justice Cortes put her thesis
into jurisprudence. There, the Court, by a slim 8-7 margin, upheld the
President's power to forbid the return of her exiled predecessor. The
rationale for the majority's ruling rested on the President's
… unstated residual powers which are implied from the grant
of executive power and which are necessary for her to comply
with her duties under the Constitution. The powers of the
President are not limited to what are expressly enumerated in
the article on the Executive Department and in scattered
provisions of the Constitution. This is so, notwithstanding the
avowed intent of the members of the Constitutional
Commission of 1986 to limit the powers of the President as a
reaction to the abuses under the regime of Mr. Marcos, for the
result was a limitation of specific powers of the President,
particularly those relating to the commander-in-chief clause,
but not a diminution of the general grant of executive power.57
[Underscoring supplied. Italics in the original.]
Thus, the President's authority to declare a state of rebellion springs in
the main from her powers as chief executive and, at the same time,
draws strength from her Commander-in-Chief powers. Indeed, as the
Solicitor General accurately points out, statutory authority for such a
declaration may be found in Section 4, Chapter 2 (Ordinance Power),
Book III (Office of the President) of the Revised Administrative Code of
1987, which states:
SEC. 4. Proclamations. – Acts of the President fixing a date or
declaring a status or condition of public moment or interest,
upon the existence of which the operation of a specific
law or regulation is made to depend, shall be promulgated
in proclamations which shall have the force of an executive
order. [Emphasis supplied.]
The foregoing discussion notwithstanding, in calling out the armed
forces, a declaration of a state of rebellion is an utter superfluity. 58 At
most, it only gives notice to the nation that such a state exists and that
the armed forces may be called to prevent or suppress it. 59 Perhaps the
declaration may wreak emotional effects upon the perceived enemies
of the State, even on the entire nation. But this Court's mandate is to
probe only into the legal consequences of the declaration. This Court
finds that such a declaration is devoid of any legal significance. For all
legal intents, the declaration is deemed not written.
Should there be any "confusion" generated by the issuance of
Proclamation No. 427 and General Order No. 4, we clarify that, as the
dissenters in Lacson correctly pointed out, the mere declaration of a
state of rebellion cannot diminish or violate constitutionally protected
rights.60 Indeed, if a state of martial law does not suspend the operation
of the Constitution or automatically suspend the privilege of the writ of
habeas corpus,61 then it is with more reason that a simple declaration of
a state of rebellion could not bring about these conditions. 62 At any rate,
the presidential issuances themselves call for the suppression of the
rebellion "with due regard to constitutional rights."
For the same reasons, apprehensions that the military and police
authorities may resort to warrantless arrests are likewise unfounded. In
Lacson vs. Perez, supra, majority of the Court held that "[i]n quelling or
suppressing the rebellion, the authorities may only resort to warrantless
arrests of persons suspected of rebellion, as provided under Section 5,
Rule 113 of the Rules of Court, 63 if the circumstances so warrant. The
warrantless arrest feared by petitioners is, thus, not based on the
declaration of a 'state of rebellion.'" 64 In other words, a person may be
subjected to a warrantless arrest for the crime of rebellion whether or
not the President has declared a state of rebellion, so long as the
requisites for a valid warrantless arrest are present.
It is not disputed that the President has full discretionary power to call
out the armed forces and to determine the necessity for the exercise of
such power. While the Court may examine whether the power was
exercised within constitutional limits or in a manner constituting grave
abuse of discretion, none of the petitioners here have, by way of proof,
supported their assertion that the President acted without factual
basis.65
The argument that the declaration of a state of rebellion amounts to a
declaration of martial law and, therefore, is a circumvention of the
report requirement, is a leap of logic. There is no indication that military
tribunals have replaced civil courts in the "theater of war" or that military
authorities have taken over the functions of civil government. There is
no allegation of curtailment of civil or political rights. There is no
indication that the President has exercised judicial and legislative
powers. In short, there is no illustration that the President has
attempted to exercise or has exercised martial law powers.
Nor by any stretch of the imagination can the declaration constitute an
indirect exercise of emergency powers, which exercise depends upon a
grant of Congress pursuant to Section 23 (2), Article VI of the
Constitution:
Sec. 23. (1) ….
(2) In times of war or other national emergency, the Congress
may, by law, authorize the President, for a limited period and
subject to such restrictions as it may prescribe, to exercise
powers necessary and proper to carry out a declared national
policy. Unless sooner withdrawn by resolution of the
Congress, such powers shall cease upon the next
adjournment thereof.
The petitions do not cite a specific instance where the President has
attempted to or has exercised powers beyond her powers as Chief
Executive or as Commander-in-Chief. The President, in declaring a
state of rebellion and in calling out the armed forces, was merely
exercising a wedding of her Chief Executive and Commander-in-Chief
powers. These are purely executive powers, vested on the President
by Sections 1 and 18, Article VII, as opposed to the delegated
legislative powers contemplated by Section 23 (2), Article VI.
WHEREFORE, the petitions are hereby DISMISSED.
SO ORDERED.
Separate Opinions
PANGANIBAN, J.:
Petitioners challenge the constitutionality of the "state of rebellion"
declared by the President through Proclamation No. 427 and General
Order No. 4 in the wake of the so-called "Oakwood Incident." The
questioned issuances, however, were subsequently lifted by her on
August 1, 2003, when she issued Proclamation No. 435. Hence, as of
today, there is no more extant proclamation or order that can be
declared valid or void.
For this reason, I believe that the Petitions should be dismissed on the
ground of mootness.
The judicial power to declare a law or an executive order
unconstitutional, according to Justice Jose P. Laurel, is "limited to
actual cases and controversies to be exercised after full opportunity of
argument by the parties, and limited further to the constitutional
question raised or the very lis mota presented."1 Following this long-
held principle, the Court has thus always been guided by these fourfold
requisites in deciding constitutional law issues: 1) there must be an
actual case or controversy involving a conflict of rights susceptible of
judicial determination; 2) the constitutional question must be raised by a
proper party; 3) the constitutional question must be raised at the
earliest opportunity; and 4) adjudication of the constitutional question
must be indispensable to the resolution of the case.2
Unquestionably, the first and the forth requirements are absent in the
present case.
Absence of Case and Controversy
The first requirement, the existence of a live case or controversy,
means that an existing litigation is ripe for resolution and susceptible of
judicial determination; as opposed to one that is conjectural or
anticipatory,3 hypothetical or feigned.4 A justiciable controversy involves
a definite and concrete dispute touching on the legal relations of parties
having adverse legal interests. 5 Hence, it admits of specific relief
through a decree that is conclusive in character, in contrast to an
opinion which only advises what the law would be upon a hypothetical
state of facts.6
As a rule, courts have no authority to pass upon issues through
advisory opinions or friendly suits between parties without real adverse
interests.7 Neither do courts sit to adjudicate academic questions –– no
matter how intellectually challenging8 –– because without a justiciable
controversy, an adjudication would be of no practical use or value. 9
While the Petitions herein have previously embodied a live case or
controversy, they now have been rendered extinct by the lifting of the
questioned issuances. Thus, nothing is gained by breathing life into a
dead issue.
Moreover, without a justiciable controversy, the Petitions 10 have
become pleas for declaratory relief, over which the Supreme Court has
no original jurisdiction. Be it remembered that they were filed directly
with this Court and thus invoked its original jurisdiction.11
On the theory that the "state of rebellion" issue is "capable of repetition
yet evading review," I respectfully submit that the question may indeed
still be resolved even after the lifting of the Proclamation and Order,
provided the party raising it in a proper case has been and/or
continue to be prejudiced or damaged as a direct result of their
issuance.
In the present case, petitioners have not shown that they have been or
continue to be directly and pecuniarily prejudiced or damaged by the
Proclamation and Order. Neither have they shown that this Court has
original jurisdiction over petitions for declaratory relief. I would venture
to say that, perhaps, if this controversy had emanated from an
appealed judgment from a lower tribunal, then this Court may still pass
upon the issue on the theory that it is "capable of repetition yet evading
review," and the case would not be an original action for declaratory
relief.
In short, the theory of "capable of repetition yet evading review" may be
invoked only when this Court has jurisdiction over the subject matter. It
cannot be used in the present controversy for declaratory relief, over
which the Court has no original jurisdiction.
The Resolution of the Case on Other Grounds
The fourth requisite, which relates to the absolute necessity of deciding
the constitutional issue, means that the Court has no other way of
resolving the case except by tackling an unavoidable constitutional
question. It is a well-settled doctrine that courts will not pass upon a
constitutional question unless it is the lis mota of the case, or if the case
can be disposed on some other grounds.12
With due respect, I submit that the mootness of the Petitions has swept
aside the necessity of ruling on the validity of Proclamation No. 427 and
General order No. 4. In the wake of its mootness, the constitutionality
issue has ceased to be the lis mota of the case or to be an unavoidable
question in the resolution thereof. Hence, the dismissal of the Petitions
for mootness is justified.13
WHEREFORE, I vote to DISMISS the Petitions. On the constitutionality
of a "state of rebellion," I reserve my judgment at the proper time and in
the proper case.
YNARES-SANTIAGO, J.:
The fundamental issue in the petitions is the legality of Proclamation
No. 427 issued by the President on July 27, 2003 declaring a "state of
rebellion".
The majority affirmed the declaration is legal because the President
was only exercising a wedding of the "Chief Executive" and
"Commander-in-Chief" powers. U.S. jurisprudence and commentators
are cited discussing the awesome powers exercised by the U.S.
President during moments of crisis 1 and that these powers are also
available to the Philippine President. 2 Although the limits cannot be
precisely defined, the majority concluded that there are enough
"residual powers" to serve as the basis to support the Presidential
declaration of a "state of rebellion". 3 The majority, however,
emphasized that the declaration cannot diminish or violate
constitutionally protected rights.4 They affirmed the legality of
warrantless arrests of persons who participated in the rebellion, if
circumstances so warrant5 with this clarification: "[i]n other words, a
person may be subjected to a warrantless arrests for the crime of
rebellion whether or not the President has declared a state of rebellion,
so long as the requisites for a valid warrantless arrest are present."6
If the requisites for a warrantless arrests must still be present for an
arrest to be made, then the declaration is a superfluity. I therefore
shudder when a blanket affirmation is given to the President to issue
declarations of a "state of rebellion" which in fact may not be the truth
or which may be in affect even after the rebellion has ended.
Proclamation No. 427 was issued at 1:00 p.m. on July 27, 2003, at the
height of the occupation of the Oakwood Premier Apartments in Ayala
Center, Makati City, by 323 junior officers and enlisted men (Oakwood
Incident),7 which began in the early morning of July 27, 2003. 8 Shortly
after, the President issued General Order No. 4, ordering the Armed
Forces of the Philippines and the Philippine National Police to use
reasonable force, and pay due regard to constitutional rights, in putting
down the rebellion.9 The Oakwood incident ended peacefully that same
evening when the militant soldiers surrendered after negotiations.
From July 27 to August 1, 2003, "search and recovery" operations were
conducted. Throughout the Oakwood Incident, searches were
conducted in the non-occupied areas,10 and, with the recovery of
evidence, staging points for the Oakwood Incident were found in
Cavite, Makati and Mandaluyong. 11 After the soldiers left at around
11:00 in the evening of July 27, a search was conducted around the
Oakwood premises.12 These searches expanded in scope on the basis
of recovered evidence.13
Ramon Cardenas, Assistant Executive Secretary in the previous
administration, was arrested, presented to the media in handcuffs and
brought for inquest proceedings before the Department of Justice
("DOJ") in the morning of July 28. 14 He was initially detained at the
Office of the Anti-Organized Crime Division of the Criminal Investigation
and Detection Group ("CIDG"), and brought to the DOJ in the afternoon
of July 28.15 Cardenas was later charged with the crime of rebellion, 16
but as of this writing has been allowed bail.
On July 31, 2003, 4 days after the militant group had surrendered
peacefully, an official spokesperson from the DOJ declared that the
President's "indefinite" imposition of the "state of rebellion" would make
"warrantless arrests" a valid exercise of executive power.
The Court can take judicial notice that the police authorities were
releasing to media "evidence found" purporting to link personalities in
the political opposition, the most prominent of whom was Senator
Gringo Honasan. Even Senator Loi Ejercito and Mayor JV Ejercito's
names were being linked to the attempted uprising.
On August 1, 2003, the President issued Proclamation No. 435,
declaring that the Armed Forces of the Philippines and the Philippine
National Police had effectively suppressed and quelled the rebellion,
and, accordingly, that the "state of rebellion" had ceased on that date.
The majority discussed only the abstract nature of the powers
exercised by the Chief Executive, without considering if there was
sufficient factual basis for the President's declaration of a "state of
rebellion" and when it ended. In taking this position, the majority is
returning, if not expanding, the doctrine enunciated in Garcia-Padilla v.
Enrile,17 which overturned the landmark doctrine in Lansang v. Garcia. 18
In Lansang, the Supreme Court upheld its authority to inquire into the
factual bases for the suspension of the privilege of the writ of habeas
corpus, and held that this inquiry raises a judicial rather than a political
question. In Garcia-Padilla, on the other hand, the ponencia held that
Lansang was no longer authoritative, and that the President's decision
to suspend the privilege is final and conclusive upon the courts and all
other persons.
These two cases were decided prior to the 1987 Constitution, which
requires this Court not only to settle actual controversies involving
rights which are legally demandable and enforceable, but also to
determine whether or not there has been a grave abuse of discretion
amounting to lack or excess of jurisdiction on the part of any branch or
instrumentality of government. 19 This provision in the 1987 Constitution
was precisely meant to check abuses of executive power. Martial Law
was still fresh in the minds of the delegates in 1987!lawphi1.nêt
The majority ignored the fact that the "state of rebellion" declared by the
President was in effect five days after the peaceful surrender of the
militant group.
The President's proclamation cites Section 18, Article VII of the
Constitution as the basis for the declaration of the "state of rebellion.".
Section 18 authorizes the President, as Commander-in-Chief, to call
out the Armed Forces, in order to suppress one of three conditions: (1)
lawless violence, (2) rebellion or (3) invasion. 20 In the latter two cases,
i.e., rebellion or invasion, the President may, when public safety
requires, also (1) suspend the privilege of the writ of habeas corpus, or
(2) place the Philippines or any part thereof under martial law.
The majority made it clear that exercise of the President's Commander-
in-Chief powers does not require the declaration of a "state of rebellion"
or a declaration of a "state of lawless violence" or a "state of invasion".
When any of these conditions exist, the President may call out the
armed forces to suppress the danger.
Thus, the declaration of a "state of rebellion" does not have any legal
meaning or consequence. This declaration does not give the President
any extra powers. It does not have any good purpose.
If the declaration is used to justify warrantless arrests even after the
rebellion has ended, as in the case of Cardenas, such declaration or, at
the least, the warrantless arrests, must be struck down.
Clearly defined in Article 134 of the Revised Penal Code is the crime of
rebellion or insurrection, to wit:
ART. 134. Rebellion or insurrection – How committed. – The crime of
rebellion or insurrection is committed by rising publicly and taking up
arms against the Government for the purpose of removing from the
allegiance to said Government or its laws, the territory of the Republic
of the Philippines or any part thereof, of any body of land, naval or other
armed forces, or depriving the Chief Executive or the legislature, wholly
or partially, of any of their powers or prerogatives.
On the other hand, a coup d' etat is defined as follows:
ART. 134-A. Coup d' etat. – How committed. – The crime of coup d'
etat is a swift attack accompanied by violence, intimidation, threat,
strategy or stealth, directed against the duly constituted authorities of
the Republic of the Philippines, or any military camp or installation,
communications networks, public utilities or other facilities needed for
the exercise and continued possession of power, singly or
simultaneously carried out anywhere in the Philippines by any person
or persons, belonging to the military or police or holding any public
office or employment, with or without civilian support or participation, for
the purpose of seizing or diminishing state power.
Under these provisions, the crime of rebellion or insurrection is
committed only by "rising publicly or taking up arms against the
Government". A coup d' etat, on the other hand, takes place only when
there is a "swift attack accompanied by violence." Once the act of
"rising publicly and taking up arms against the Government" ceases,
the commission of the crime of rebellion ceases. Similarly, when the
"swift attack" ceases, the crime of coup d' etat is no longer being
committed.
Rebellion has been held to be a continuing crime, 21 and the authorities
may resort to warrantless arrests of persons suspected of rebellion, as
provided under Section 5, Rule 113 of the Rules of Court. 22 However,
this doctrine should be applied to its proper context – i.e., relating to
subversive armed organizations, such as the New People's Army, the
avowed purpose of which is the armed overthrow of the organized and
established government. Only in such instance should rebellion be
considered a continuing crime.
When the soldiers surrendered peacefully in the evening of July 27, the
rebellion or the coup d' etat ended. The President, however, did not lift
the declaration of the "state of rebellion" until 5 days later, on August 1,
2003.
After the peaceful surrender, no person suspected of having conspired
with the soldiers or participated in the Oakwood incident could be
arrested without a warrant of arrest. Section 5, Rule 113 of the Revised
Rules of Court, which governs arrest without warrant, provides as
follows:
SEC. 5. Arrest without warrant; when lawful. – A peace officer or a
private person may, without a warrant, arrest a person:
(a) When, in his presence, the person to be arrested has
committed, is actually committing, or is attempting to commit
an offense;
(b) When an offense has just been committed and he has
probable cause to believe based on personal knowledge of
facts or circumstances that the person to be arrested has
committed it; and
xxxxxxxxx
In cases falling under paragraphs (a) and (b) above, the person
arrested without a warrant shall be forthwith delivered to the nearest
police station or jail and shall be proceeded against in accordance with
section 7 of Rule 112.
Rule 113, Section 5, pars. (a) and (b) of the Rules of Court are
exceptions to the due process clause in the Constitution. Section 5, par.
(a) relates to a situation where a crime is committed or attempted in the
presence of the arresting officer.
Section 5, par. (b), on the other hand, presents the requirement of
"personal knowledge", on the part of the arresting officer, of facts
indicating that an offense had "just been committed", and that the
person to be arrested had committed that offense.
After the peaceful surrender of the soldiers on July 27, 2003, there was
no crime that was being "attempted", "being committed", or "had just
been committed." There should, therefore, be no occasion to effect a
valid warrantless arrest in connection with the Oakwood Incident.
The purpose of the declaration and its duration as far as the overeager
authorities were concerned was only to give legal cover to effect
warrantless arrests even if the "state of rebellion" or the instances
stated in Rule 113, Section 5 of the Rules are absent or no longer exist.
Our history had shown the dangers when too much power is
concentrated in the hands of one person. Unless specifically defined, it
is risky to concede and acknowledge the "residual powers" to justify the
validity of the presidential issuances. This can serve as a blank check
for other issuances and open the door to abuses. The majority cite the
exercise of strong executive powers by U.S. President Andrew
Jackson. Was it not President Jackson who is said to have cynically
defied the U.S. Supreme Court's ruling (under Chief Justice Marshall)
against the forcible removal of the American Indians from the tribal
lands by saying: "The Chief Justice has issued his Decision, now let
him try to enforce it?" Others quote Madison as having gone further
with: "With what army will the Chief Justice enforce his Decision?"
WHEREFORE, I vote for Proclamation No. 427 and General Order No.
4, issued on July 27, 2003 by Respondent President Gloria Macapagal-
Arroyo, to be declared NULL and VOID for having been issued with
grave abuse of discretion amounting to lack of jurisdiction. All other
orders issued and action taken based on those issuances, especially
after the Oakwood incident ended in the evening of July 27, 2003, e.g.,
warrantless arrests, should also be declared null and void.
Dissenting Opinion
SANDOVAL-GUTIERREZ, J.:
"Courts will decide a question otherwise moot and academic if it is
'capable of repetition, yet evading review.'" 1 On this premise, I stood
apart from my colleagues in dismissing the petition in Lacson vs.
Perez.2 Their reason was that President Gloria Macapagal-Arroyo's
lifting of the declaration of a "state of rebellion" rendered moot and
academic the issue of its constitutionality. Looking in retrospect, my
fear then was the repetition of the act sought to be declared
unconstitutional.
No more than three (3) years have passed, and here we are again
haunted by the same issue.
I
A brief restatement of the facts is imperative.
In the wee hours of July 27, 2003, three hundred twenty-three (323)
junior officers and enlisted men of the Armed Forces of the Philippines
(AFP) took over the Oakwood Premier Apartments, Ayala Center,
Makati City. Introducing themselves as the "Magdalo Group," they
claimed that they went to Oakwood to air their grievances about graft
and corruption in the military, the sale of arms and ammunitions to the
"enemies" of the state, the bombings in Davao City allegedly ordered
by Gen. Victor Corpus, then Chief of the Intelligence Service of the
Armed Forces of the Philippines (ISAFP), the increased military
assistance from the United States, and "micromanagement" in the AFP
by Gen. Angelo Reyes, then Secretary of the Department of National
Defense.3 The military men demanded the resignation of the President,
the Secretary of National Defense and the Chief of the Philippine
National Police.
At about 9:00 A.M. of the same day, President Arroyo gave the
Magdalo Group until 5:00 P.M. to give up their positions peacefully and
return to the barracks. At around 1:00 P.M., she issued Proclamation
No. 427 and General Order No. 4 declaring the existence of a "state of
rebellion" and calling out the AFP to suppress the rebellion.
Shortly before the 5:00 P.M. deadline, President Arroyo announced an
extension until 7:00 P.M. During the two-hour reprieve, negotiations
between the Magdalo Group and various personalities took place. The
rebels agreed to return to the barracks. They left the Oakwood
premises at 11:00 P.M.
On July 28, 2003, Agents of the National Bureau of Investigation (NBI)
searched the house owned by Ramon Cardenas at 2177 Paraiso St.,
Dasmariñas Village, Makati City. After the raid and the recovery of
evidence claimed to link him to rebellion, Cardenas, accompanied by
Atty. Rene Saguisag, went to the CIDG in Camp Crame. On the same
day, Cardenas was brought to the Department of Justice for inquest
proceeding. He was later charged with the crime of rebellion.
The Mandaluyong City Police likewise searched the townhouses
belonging to Laarni Enriquez, allegedly used as staging areas by the
Magdalo Group.
On August 1, 2003, President Arroyo lifted her declaration of a state of
rebellion through Proclamation No. 435.
Meanwhile, on August 4, 2003, Secretary Jose Lina, Jr. of the
Department of the Interior and Local Government, forwarded to the
DOJ the affidavit-complaint for coup d'etat of PC Chief Superintendent
Eduardo Matillano against Senator Gregorio Honasan, Ernesto
Macahiya, George Duldulao and several "John and Jane Does"
numbering about 1,000.
On August 8, 2003, PNP Chief Inspector Jesus Fernandez of the
Eastern Police District referred to the DOJ an investigation report
recommending that Enriquez and a certain Romy Escalona be
prosecuted for rebellion and insurrection.
II
I regret that I cannot give my assent to the ponencia of Mr. Justice
Dante O. Tinga even as I admire it for its lucidity and historical
accuracy. The passage of time has not changed my Opinion in Lacson
vs. Perez – that President Arroyo's declaration of a "state of rebellion"
is unconstitutional.
I cannot subscribe to the majority's view that the declaration of a "state
of rebellion" is justified under Article VII of the 1987 Constitution
granting her "Executive" and "Commander-in-Chief" powers.
III
Consistent with my previous stand, it is my view that nowhere in the
Constitution can be found a provision which grants to the President the
authority to declare a "state of rebellion," or exercise powers, which
may be legally allowed only under a state of martial law. President
Arroyo, in declaring a "state of rebellion," deviated from the following
provisions of the Constitution:
"Sec. 18. The President shall be the Commander-in-Chief of all armed
forces of the Philippines and whenever if becomes necessary, he may
call out such armed forces to prevent or suppress lawless violence,
invasion or rebellion. In case of invasion or rebellion, when the public
safety requires it, he may, for a period not exceeding sixty days,
suspend the privilege of the writ of habeas corpus or place the
Philippines or any part thereof under martial law. Within forty-eight
hours from the proclamation of martial law or the suspension of the
privilege of the writ of habeas corpus, the President shall submit a
report in person or in writing to the Congress. The Congress, voting
jointly, by a vote of at least a majority of all its Members in regular or
special session, may revoke such proclamation or suspension, which
revocation shall not be set aside by the President. Upon the initiative of
the President, the Congress may, in the same manner, extend such
proclamation or suspension for a period to be determined by the
Congress, if the invasion or rebellion shall persist and public safety
requires it.
The Congress, if not in session, shall within twenty-four hours following
such proclamation or suspension, convene in accordance with its rules
without need of a call.lawphil.net
The Supreme Court may review, in an appropriate proceeding filed by
any citizen, the sufficiency of the factual bases of the proclamation of
martial law or the suspension of the privilege of the writ or the extension
thereof, and must promulgate its decision thereon within thirty days
from its filing.
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or legislative
assemblies, nor authorize the conferment of jurisdiction on military
courts and agencies over civilians where civil courts are able to
function, nor automatically suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to persons
judicially charged for rebellion or offenses inherent in or directly
connected with invasion.
During the suspension of the privilege of the writ, any person thus
arrested or detained shall be judicially charged within three days,
otherwise he shall be released."4
The powers of the President when she assumed the existence of
rebellion are laid down by the Constitution. She may (1) call the armed
forces to prevent or suppress lawless violence, invasion or rebellion; (2)
suspend the privilege of the writ of habeas corpus; or (3) place the
Philippines or any part thereof under martial law. Now, why did
President Arroyo declare a "state of rebellion" when she has no such
power under the Constitution?
If President Arroyo's only purpose was merely to exercise her "calling
out power," then she could have simply ordered the AFP to prevent or
suppress what she perceived as an invasion or rebellion. Such course
raises no constitutional objection, it being provided for by the above-
quoted provisions. However, adopting an unorthodox measure
unbounded and not canalized by the language of the Constitution is
dangerous. It leaves the people at her mercy and that of the military,
ignorant of their rights under the circumstances and wary of their settled
expectations. One good illustration is precisely in the case of invasion
or rebellion. Under such situation, the President has the power to
suspend the privilege of the writ of habeas corpus or to declare martial
law. Such power is not a plenary one, as shown by the numerous
limitations imposed thereon by the Constitution, some of which are: (1)
the public safety requires it; (2) it does not exceed sixty (60) days; (3)
within forty-eight (48) hours, she shall submit a report, in writing or in
person, to Congress; (4) The Congress, by a vote of at least a majority
of all its members, may revoke such proclamation or suspension. All
these limitations form part of the citizens' settled expectations. If the
President exceeds the set limitations, the citizens know that they may
resort to this Court through appropriate proceeding to question the
sufficiency of the factual bases of the proclamation of martial law or the
suspension of the privilege of the writ. In turn, this Court shall
promulgate its Decision within thirty days from the filing of the proper
pleading. All the foregoing guarantees and limitations are absent in the
declaration of a "state of rebellion." It is not subject to clear legal
restraints. How then can the citizens determine the propriety of the
President's acts committed pursuant to such declaration? How can
excess of power be curtailed at its inception?
Indeed, I see no reason for the President to deviate from the concise
and plain provisions of the Constitution. In a society which adheres to
the rule of law, resort to extra-constitutional measures is unnecessary
where the law has provided everything for any emergency or
contingency. For even if it may be proven beneficial for a time, the
precedent it sets is pernicious as the law may, in a little while, be
disregarded again on the same pretext but for questionable purposes.
Even in time of emergency, government action may vary in breath and
intensity from more normal times, yet it need not be less constitutional. 5
Extraordinary conditions may call for extraordinary remedies. But it
cannot justify action which lies outside the sphere of constitutional
authority. Extraordinary conditions do not create or enlarge
constitutional power.6
I cannot simply close my eyes to the dangers that lurk behind the
seemingly harmless declaration of a "state of rebellion." Still fresh from
my memory is the May 1, 2001 civil unrest. On such date, President
Arroyo placed Metro Manila under a "state of rebellion" because of the
violent street clashes involving the loyalists of former President Joseph
Estrada and the police authorities. Presidential Spokesperson
Rigoberto Tiglao told reporters, "We are in a state of rebellion. This is
not an ordinary demonstration."7 Immediately thereafter, there were
threats of arrests against those suspected of instigating the march to
Malacañang. At about 3:30 in the afternoon, Senator Juan Ponce Enrile
was arrested in his house in Dasmariñas Village, Makati City by a
group led by Gen. Reynaldo Berroya, Chief of the Philippine National
Police Intelligence Group. 8 Thereafter, he and his men proceeded to
hunt re-electionist Senator Gregorio Honasan, former PNP Chief, now
Senator Panfilo Lacson, former Ambassador Ernesto Maceda, Brig.
Gen. Jake Malajakan, Senior Superintendents Michael Ray Aquino and
Cesar Mancao II, Ronald Lumbao and Cesar Tanega of the People's
Movement Against Poverty (PMAP).9 Former Justice Secretary
Hernando Perez said that he was "studying" the possibility of placing
Senator Miriam Defensor-Santiago "under the Witness Protection
Program." Director Victor Batac, former Chief of the PNP Directorate for
Police Community Relations, and Senior Superintendent Diosdado
Valeroso, of the Philippine Center for Transnational Crime, surrendered
to Gen. Berroya. Both denied having plotted the siege. On May 2, 2001,
former Ambassador Ernesto Maceda was arrested.
On President Arroyo's mere declaration of a "state of rebellion," police
authorities arrested without warrants the above-mentioned
personalities. In effect, she placed the Philippines under martial law
without a declaration to that effect and without observing the proper
procedure. This is a very dangerous precedent. The Constitution
provides that "the right of the people to be secure in their persons,
houses, papers and effects against unreasonable searches and seizure
of whatever nature and for any purpose shall be inviolable, and no
search warrant or warrant of arrest shall issue except upon probable
cause to be determined personally by the judge after examination
under oath or affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched and the
persons or things to be seized." 10 Obviously, violation of this
constitutional provision cannot be justified by reason of the declaration
of a "state of rebellion" for such declaration, as earlier mentioned, is
unconstitutional.
Even under Section 5, Rule 113 of the Revised Rules on Criminal
Procedure11 the warrantless arrests effected by President Arroyo's men
are not justified. The above-mentioned personalities cannot be
considered "to have committed, are actually committing, or are
attempting to commit an offense" at the time they were arrested without
warrants. None of them participated in the riot which took place in the
vicinity of the Malacañang Palace. Some of them were in their
respective houses performing innocent acts. The sure fact is –– they
were not in the presence of Gen. Berroya. Clearly, he did not see
whether they had committed, were committing or were attempting to
commit the crime of rebellion. 12 It bears mentioning that at the time
some of the suspected instigators were arrested, a long interval of time
already passed and hence, it cannot be legally said that they had just
committed an offense. Neither can it be said that Gen. Berroya or any
of his men had "personal knowledge of facts or circumstances that the
persons to be arrested have committed a crime." That would be far
from reality.1awphil.net
The circumstances that arose from President Arroyo's resort to the
declaration of a "state of rebellion" to suppress what she perceived as
the May 1, 2001 rebellion are the very evils that we should prevent from
happening again. This can only be done if we strike such unusual
measure as unconstitutional.
Significantly, while the Oakwood event ended peacefully on the night of
July 27, 2003, President Arroyo's declaration of a "state of rebellion"
continued until the lifting thereof on August 1, 2003. This means that
although the alleged rebellion had ceased, the President's declaration
continued to be in effect. As it turned out, several searches and
seizures took place during the extended period.
Generally, the power of the President in times of war, invasion or
rebellion and during other emergency situations should be exercised
jointly with Congress. This is to insure the correctness and propriety of
authorizing our armed forces to quell such hostilities. Such collective
judgment is to be effected by "heightened consultation" between the
President and Congress. Thus, as can be gleaned from the provisions
of the Constitution, when the President proclaims martial law or
suspends the privilege of the writ, he shall "submit a report in person or
in writing to the Congress. The Congress, voting jointly, by a vote of at
least a majority of all its Members in regular or special session, may
revoke such proclamation or suspension, which revocation shall not be
set aside by the President." Not only that, Section 23, Article VI of the
Constitution provides that: "The Congress, by a vote of two-thirds of
both Houses in joint session assembled, voting separately, shall have
the sole power to declare the existence of a state of war. In times of
war or other national emergency, the Congress may, by law, authorize
the President, for a limited period and subject to such restrictions as it
may prescribe, to exercise powers necessary and proper to carry out a
declared national policy." Clearly, the Constitution has not extended
excessive authority in military, defense and emergency matters to the
President. Though the President is designated as the Commander-in-
Chief of all armed forces of the Philippines, the textual reed does not
suffice to support limitless authority. Born by the nation's past
experiences, the concurrence of the Congress is required as a measure
to ward-off totalitarian rule. By declaring a "state of rebellion," President
Arroyo effectively disregarded such concurrent power of Congress. At
this point, let it be stressed that the accumulation of both the executive
and legislative powers in the same hands constitutes the very definition
of tyranny.
By sustaining the unusual course taken by President Arroyo, we are
traversing a very dangerous path. We are opening the way to those
who, in the end, would turn our democracy into a totalitarian rule. While
it may not plunge us straightway into dictatorship, however, it is a step
towards a wrong direction. History must not be allowed to repeat itself.
Any act which gears towards possible dictatorship must be severed at
its inception. As I have stated in my previous dissent, our nation had
seen the rise of a dictator into power. As a matter of fact, the changes
made by the 1986 Constitutional Commission in the martial law text of
the Constitution were to a large extent a reaction against the direction
which this Court took during the regime of President Marcos. 13 In ruling
that the declaration of a "state of rebellion" is a prerogative of the
President, then, I say, our country is tracing the same dangerous road
of the past.
IV
The majority cited U.S. cases in support of their stand that the
President's proclamation of "state of rebellion" is in accordance with the
Constitutional provisions granting her "powers as chief executive." I find
that In re Debs 14 and Prize Cases15 illustrate an executive power much
larger than is indicated by the rudimentary constitutional provisions.
Clearly, these cases cannot support the majority's conclusion that: "The
lesson to be learned from the U.S. constitutional history is that the
Commander-in-Chief powers are broad enough as it is and become
more so when taken together with the provision on executive power
and the presidential oath of office. Thus, the plenitude of the powers of
the presidency equips the occupant with the means to address
exigencies or threats which undermine the very existence of
government or the integrity of the State."
There are reasons why I find the above conclusion of the majority
naccurate. From a survey of U.S. jurisprudence, the outstanding fact
remains that every specific proposal to confer uncontrollable power
upon the President is rejected. 16 In re Debs,17 the U.S. Supreme Court
Decision upheld the power of President Grover Cleveland to prevent
the strike of railway workers on the ground that it threatened
interference with interstate commerce and with the free flow of mail.
The basic theory underlying this case – that the President has inherent
power to act for the nation in cases of major public need – was eroded
by the Youngstown Sheet & Tube Co. vs. Sawyer, also known as the
Steel Seizure Case.18 This case aroused great public interest, largely
because of its important implications concerning the boundaries of
presidential powers. The seven separate opinions consist of 128 pages
in the Reports and contain a great deal of important date on the powers
of the Chief Executive. The same case demonstrates well that
executive powers, even during an alleged emergency, may still be
subject to judicial control. The decision constitutes a "dramatic
vindication" of the American constitutional government. 19 Mr. Justice
Andrew Jackson, concurring in the judgment and opinion of the Court,
eloquently expounded on the "executive" and "commander-in-chief"
powers, thus:
"The Solicitor general seeks the power of seizure in three clauses of the
Executive Article, the first reading, 'The executive Power shall be
vested in a President of the United States of America.' Lest I be thought
to exaggerate, I quote the interpretation which his brief puts upon it: 'In
our view, this clause constitutes a grant of all the executive powers of
which the Government is capable.' If that be true, it is difficult to see
why the forefathers bothered to add several specific items, including
some trifling ones.
The example of such unlimited executive power that must have most
impressed the forefathers was the prerogative exercised by George III,
and the description of its evils in the Declaration of Independence leads
me to doubt that they were creating their new Executive in his image.
Continental European examples were no more appealing. And if we
seek instruction from our own times, we can match it only from the
executive powers in those governments were disparingly describe as
totalitarian. I cannot accept the view that this clause is a grant in bulk of
all conceivable executive powers but regard it as an allocation to the
presidential office of the generic powers thereafter stated.
The clause on which the Government next relies is that 'The President
shall be Commander in Chief of the Army and Navy of the United
States…' These cryptic words have given rise to some of the most
persistent controversies in our constitutional history. Of course, they
imply something more than an empty title. But just what authority goes
with the name has plagued presidential advisers who would not waive
or narrow it by non-assertion yet cannot say where it begins or ends.
xxxxxx
The third clause in which the Solicitor General finds seizure powers is
that 'he shall take care that the laws be faithfully executed…' That
authority must be matched against words of the Fifth Amendment that
'No person shall be…deprived of life, liberty or property, without due
process of law…' One gives a governmental authority that reaches so
far as there is law, the other gives a private right that authority shall go
no farther. These signify about all there is of the principle that ours is a
governmental of laws, not of men, and that we submit ourselves to
rulers only if under rules."
Further, Mr. Justice Jackson referred to the discussion of inherent
executive powers as "loose and irresponsible use of adjectives." His
wrath could be seen as reserved for those who use the word "inherent"
to mean "unlimited."20 Thus:
"The Solicitor General lastly grounds support of the seizure upon
nebulous, inherent powers never expressly granted but said to have
accrued to the office from the customs and claims of preceding
administrations. The plea is for a resulting power to deal with a crisis or
an emergency according to the necessities of the case, the
unarticulated assumption being that necessity knows no law.
Loose and irresponsible use of adjectives colors all non-legal and much
legal discussion of presidential powers. 'Inherent' powers, 'implied'
powers, 'incidental' powers, 'plenary' powers, 'war' powers and
'emergency' powers are used, often interchangeably and without fixed
or ascertainable meanings.
The vagueness and generality of the clauses that set forth presidential
powers afford a plausible basis for pressures within and without an
administration for presidential action beyond that supported by those
whose responsibility it is to defend his actions in court. The claim of
inherent and unrestricted presidential powers has long been a
persuasive dialectical weapon in political controversy. While it is not
surprising that counsel should grasp support from such unadjudicated
claims of power, a judge cannot accept self-serving press statements of
the attorney for one of the interested parties as authority in answering a
constitutional question, even if the advocate was himself. But prudence
has counseled that actual reliance on such nebulous claims stop short
of provoking a judicial test…"
In re Debs also received a serious blow in United States vs. United
States District Court.21 The Supreme Court Justices unanimously
rejected the inherent executive authority to engage in warrantless
electronic surveillance in domestic security cases. Thus, where a
substantial personal interest in life, liberty or property is threatened by
presidential action, In re Debs is regarded more as an anachronism
than authority.
In Prizes Cases, by a vote of 5 to 4, the U.S. Supreme Court upheld
President Abraham Lincoln's authority to impose a blockade. Under the
U.S. Constitution, only Congress, empowered to declare a war, could
impose a blockade. It must be emphasized, however, that there is a
distinction between the role of the U.S. President in domestic affairs
and in foreign affairs. The patterns in the foreign and domestic realms
are quite different. The federal regulation of domestic affairs has its
constitutional origins in the people and the states, and its initiation is
allocated primarily to Congress (not the Executive). The constitutional
role for the executive in domestic matters is thus largely ancillary to that
of Congress.22 Thus, while it is recognized that executive power is
predominant in foreign affairs, it is not so in the domestic sphere. This
distinction should be considered in invoking U.S. jurisprudence.
Clearly, the trail of U.S. jurisprudence does not support the view that
the "Executive and Commander-in-Chief clauses" of the Constitution
grant the President such broad power as to give her the option of
disregarding the other restrictive provisions of the Constitution. The
purpose of the Constitution is not only to grant power, but to keep it
from getting out of hand. The policy should be –– where the
Constitution has laid down specific procedures on how the President
should deal with a crisis, it is imperative that he must follow those
procedures in meeting the crisis. These procedures serve as limitations
to what would otherwise be an unbounded exercise of power.
V
In fine, may I state that every presidential claim to a power must be
scrutinized with caution, for what is at stake is the equilibrium
established by our constitutional system. The powers of the President
are not as particularized as are those of Congress. Enumerated powers
do not include undefined powers, as what the majority would want to
point out. I state once more that there is no provision in our Constitution
authorizing the President to declare "a state of rebellion." Not even the
constitutional powers vested upon her include such power.
WHEREFORE, I vote to GRANT the petitions. Proclamation No. 427
and General Order No. 4 are declared UNCONSTITUTIONAL.
G.R. No. 164978 October 13, 2005
AQUILINO Q. PIMENTEL, JR., EDGARDO J. ANGARA, JUAN
PONCE ENRILE, LUISA P. EJERCITO-ESTRADA, JINGGOY E.
ESTRADA, PANFILO M. LACSON, ALFREDO S. LIM, JAMBY A.S.
MADRIGAL, and SERGIO R. OSMEÑA III, Petitioners
vs.
EXEC. SECRETARY EDUARDO R. ERMITA, FLORENCIO B. ABAD,
AVELINO J. CRUZ, JR., MICHAEL T. DEFENSOR, JOSEPH H.
DURANO, RAUL M. GONZALEZ, ALBERTO G. ROMULO, RENE C.
VILLA, and ARTHUR C. YAP, Respondents.
DECISION
CARPIO, J.:
The Case
This is a petition for certiorari and prohibition1 with a prayer for the
issuance of a writ of preliminary injunction to declare unconstitutional
the appointments issued by President Gloria Macapagal-Arroyo
("President Arroyo") through Executive Secretary Eduardo R. Ermita
("Secretary Ermita") to Florencio B. Abad, Avelino J. Cruz, Jr., Michael
T. Defensor, Joseph H. Durano, Raul M. Gonzalez, Alberto G. Romulo,
Rene C. Villa, and Arthur C. Yap ("respondents") as acting secretaries
of their respective departments. The petition also seeks to prohibit
respondents from performing the duties of department secretaries.
Antecedent Facts
The Senate and the House of Representatives ("Congress")
commenced their regular session on 26 July 2004. The Commission on
Appointments, composed of Senators and Representatives, was
constituted on 25 August 2004.
Meanwhile, President Arroyo issued appointments2 to respondents as
acting secretaries of their respective departments.
The appointment papers are uniformly worded as follows:
Sir:
Pursuant to the provisions of existing laws, you are hereby appointed
ACTING SECRETARY, DEPARTMENT OF (appropriate department)
vice (name of person replaced).
By virtue hereof, you may qualify and enter upon the performance of
the duties and functions of the office, furnishing this Office and the Civil
Service Commission with copies of your Oath of Office.
(signed)
Gloria Arroyo
Respondents took their oath of office and assumed duties as acting
secretaries.
On 8 September 2004, Aquilino Q. Pimentel, Jr. ("Senator Pimentel"),
Edgardo J. Angara ("Senator Angara"), Juan Ponce Enrile ("Senator
Enrile"), Luisa P. Ejercito-Estrada ("Senator Ejercito-Estrada"), Jinggoy
E. Estrada ("Senator Estrada"), Panfilo M. Lacson ("Senator Lacson"),
Alfredo S. Lim ("Senator Lim"), Jamby A.S. Madrigal ("Senator
Madrigal"), and Sergio R. Osmeña, III ("Senator Osmeña")
("petitioners") filed the present petition as Senators of the Republic of
the Philippines.
Congress adjourned on 22 September 2004. On 23 September 2004,
President Arroyo issued ad interim appointments3 to respondents as
secretaries of the departments to which they were previously appointed
in an acting capacity. The appointment papers are uniformly worded as
follows:
Sir:
Pursuant to the provisions of existing laws, you are hereby appointed
SECRETARY [AD INTERIM], DEPARTMENT OF (appropriate
department).
By virtue hereof, you may qualify and enter upon the performance of
the duties and functions of the office, furnishing this Office and the Civil
Service Commission with copies of your oath of office.
(signed)
Gloria Arroyo
Issue
The petition questions the constitutionality of President Arroyo’s
appointment of respondents as acting secretaries without the consent
of the Commission on Appointments while Congress is in session.
The Court’s Ruling
The petition has no merit.
Preliminary Matters
On the Mootness of the Petition
The Solicitor General argues that the petition is moot because
President Arroyo had extended to respondents ad interim appointments
on 23 September 2004 immediately after the recess of Congress.
As a rule, the writ of prohibition will not lie to enjoin acts already done. 4
However, as an exception to the rule on mootness, courts will decide a
question otherwise moot if it is capable of repetition yet evading
review.5
In the present case, the mootness of the petition does not bar its
resolution. The question of the constitutionality of the President’s
appointment of department secretaries in an acting capacity while
Congress is in session will arise in every such appointment.
On the Nature of the Power to Appoint
The power to appoint is essentially executive in nature, and the
legislature may not interfere with the exercise of this executive power
except in those instances when the Constitution expressly allows it to
interfere.6 Limitations on the executive power to appoint are construed
strictly against the legislature. 7 The scope of the legislature’s
interference in the executive’s power to appoint is limited to the power
to prescribe the qualifications to an appointive office. Congress cannot
appoint a person to an office in the guise of prescribing qualifications to
that office. Neither may Congress impose on the President the duty to
appoint any particular person to an office.8
However, even if the Commission on Appointments is composed of
members of Congress, the exercise of its powers is executive and not
legislative. The Commission on Appointments does not legislate when it
exercises its power to give or withhold consent to presidential
appointments. Thus:
xxx The Commission on Appointments is a creature of the Constitution.
Although its membership is confined to members of Congress, said
Commission is independent of Congress. The powers of the
Commission do not come from Congress, but emanate directly from the
Constitution. Hence, it is not an agent of Congress. In fact, the
functions of the Commissioner are purely executive in nature. xxx9
On Petitioners’ Standing
The Solicitor General states that the present petition is a quo warranto
proceeding because, with the exception of Secretary Ermita, petitioners
effectively seek to oust respondents for unlawfully exercising the
powers of department secretaries. The Solicitor General further states
that petitioners may not claim standing as Senators because no power
of the Commission on Appointments has been "infringed upon or
violated by the President. xxx If at all, the Commission on Appointments
as a body (rather than individual members of the Congress) may
possess standing in this case."10
Petitioners, on the other hand, state that the Court can exercise its
certiorari jurisdiction over unconstitutional acts of the President. 11
Petitioners further contend that they possess standing because
President Arroyo’s appointment of department secretaries in an acting
capacity while Congress is in session impairs the powers of Congress.
Petitioners cite Sanlakas v. Executive Secretary12 as basis, thus:
To the extent that the powers of Congress are impaired, so is the power
of each member thereof, since his office confers a right to participate in
the exercise of the powers of that institution.
An act of the Executive which injures the institution of Congress causes
a derivative but nonetheless substantial injury, which can be questioned
by a member of Congress. In such a case, any member of Congress
can have a resort to the courts.
Considering the independence of the Commission on Appointments
from Congress, it is error for petitioners to claim standing in the present
case as members of Congress. President Arroyo’s issuance of acting
appointments while Congress is in session impairs no power of
Congress. Among the petitioners, only the following are members of the
Commission on Appointments of the 13th Congress: Senator Enrile as
Minority Floor Leader, Senator Lacson as Assistant Minority Floor
Leader, and Senator Angara, Senator Ejercito-Estrada, and Senator
Osmeña as members.
Thus, on the impairment of the prerogatives of members of the
Commission on Appointments, only Senators Enrile, Lacson, Angara,
Ejercito-Estrada, and Osmeña have standing in the present petition.
This is in contrast to Senators Pimentel, Estrada, Lim, and Madrigal,
who, though vigilant in protecting their perceived prerogatives as
members of Congress, possess no standing in the present petition.
The Constitutionality of President Arroyo’s Issuance
of Appointments to Respondents as Acting Secretaries
Petitioners contend that President Arroyo should not have appointed
respondents as acting secretaries because "in case of a vacancy in the
Office of a Secretary, it is only an Undersecretary who can be
designated as Acting Secretary."13 Petitioners base their argument on
Section 10, Chapter 2, Book IV of Executive Order No. 292 ("EO
292"),14 which enumerates the powers and duties of the undersecretary.
Paragraph 5 of Section 10 reads:
SEC. 10. Powers and Duties of the Undersecretary. - The
Undersecretary shall:
xxx
(5) Temporarily discharge the duties of the Secretary in the latter’s
absence or inability to discharge his duties for any cause or in case of
vacancy of the said office, unless otherwise provided by law. Where
there are more than one Undersecretary, the Secretary shall allocate
the foregoing powers and duties among them. The President shall
likewise make the temporary designation of Acting Secretary from
among them; and
xxx
Petitioners further assert that "while Congress is in session, there can Congress is not the only source of law. "Law" refers to the Constitution,
be no appointments, whether regular or acting, to a vacant position of statutes or acts of Congress, municipal ordinances, implementing rules
an office needing confirmation by the Commission on Appointments, issued pursuant to law, and judicial decisions.17
without first having obtained its consent."15 Finally, petitioners claim that the issuance of appointments in an acting
In sharp contrast, respondents maintain that the President can issue capacity is susceptible to abuse. Petitioners fail to consider that acting
appointments in an acting capacity to department secretaries without appointments cannot exceed one year as expressly provided in Section
the consent of the Commission on Appointments even while Congress 17(3), Chapter 5, Title I, Book III of EO 292. The law has incorporated
is in session. Respondents point to Section 16, Article VII of the 1987 this safeguard to prevent abuses, like the use of acting appointments
Constitution. Section 16 reads: as a way to circumvent confirmation by the Commission on
SEC. 16. The President shall nominate and, with the consent of the Appointments.
Commission on Appointments, appoint the heads of the executive In distinguishing ad interim appointments from appointments in an
departments, ambassadors, other public ministers and consuls, or acting capacity, a noted textbook writer on constitutional law has
officers of the armed forces from the rank of colonel or naval captain, observed:
and other officers whose appointments are vested in him in this Ad-interim appointments must be distinguished from appointments in
Constitution. He shall also appoint all other officers of the Government an acting capacity. Both of them are effective upon acceptance. But ad-
whose appointments are not otherwise provided for by law, and those interim appointments are extended only during a recess of Congress,
whom he may be authorized by law to appoint. The Congress may, by whereas acting appointments may be extended any time there is a
law, vest the appointment of other officers lower in rank in the President vacancy. Moreover ad-interim appointments are submitted to the
alone, in the courts, or in the heads of departments, agencies, Commission on Appointments for confirmation or rejection; acting
commissions, or boards. appointments are not submitted to the Commission on Appointments.
The President shall have the power to make appointments during the Acting appointments are a way of temporarily filling important offices
recess of the Congress, whether voluntary or compulsory, but such but, if abused, they can also be a way of circumventing the need for
appointments shall be effective only until disapproval by the confirmation by the Commission on Appointments.18
Commission on Appointments or until the next adjournment of the However, we find no abuse in the present case. The absence of abuse
Congress. is readily apparent from President Arroyo’s issuance of ad interim
Respondents also rely on EO 292, which devotes a chapter to the appointments to respondents immediately upon the recess of
President’s power of appointment. Sections 16 and 17, Chapter 5, Title Congress, way before the lapse of one year.
I, Book III of EO 292 read: WHEREFORE, we DISMISS the present petition for certiorari and
SEC. 16. Power of Appointment. — The President shall exercise the prohibition.
power to appoint such officials as provided for in the Constitution SO ORDERED.
and laws.
SEC. 17. Power to Issue Temporary Designation. — (1) The President
may temporarily designate an officer already in the government
service or any other competent person to perform the functions of
an office in the executive branch, appointment to which is vested
in him by law, when: (a) the officer regularly appointed to the
office is unable to perform his duties by reason of illness, absence
or any other cause; or (b) there exists a vacancy[.]
(2) The person designated shall receive the compensation attached to
the position, unless he is already in the government service in which
case he shall receive only such additional compensation as, with his
existing salary, shall not exceed the salary authorized by law for the
position filled. The compensation hereby authorized shall be paid out of
the funds appropriated for the office or agency concerned.
(3) In no case shall a temporary designation exceed one (1) year.
(Emphasis supplied)
Petitioners and respondents maintain two diametrically opposed lines of
thought. Petitioners assert that the President cannot issue
appointments in an acting capacity to department secretaries while
Congress is in session because the law does not give the President
such power. In contrast, respondents insist that the President can issue
such appointments because no law prohibits such appointments.
The essence of an appointment in an acting capacity is its temporary
nature. It is a stop-gap measure intended to fill an office for a limited
time until the appointment of a permanent occupant to the office. 16 In
case of vacancy in an office occupied by an alter ego of the President,
such as the office of a department secretary, the President must
necessarily appoint an alter ego of her choice as acting secretary
before the permanent appointee of her choice could assume office.
Congress, through a law, cannot impose on the President the obligation
to appoint automatically the undersecretary as her temporary alter ego.
An alter ego, whether temporary or permanent, holds a position of great
trust and confidence. Congress, in the guise of prescribing
qualifications to an office, cannot impose on the President who her alter
ego should be.
The office of a department secretary may become vacant while
Congress is in session. Since a department secretary is the alter ego of
the President, the acting appointee to the office must necessarily have
the President’s confidence. Thus, by the very nature of the office of a
department secretary, the President must appoint in an acting capacity
a person of her choice even while Congress is in session. That person
may or may not be the permanent appointee, but practical reasons may
make it expedient that the acting appointee will also be the permanent
appointee.
The law expressly allows the President to make such acting
appointment. Section 17, Chapter 5, Title I, Book III of EO 292 states
that "[t]he President may temporarily designate an officer already in the
government service or any other competent person to perform the
functions of an office in the executive branch." Thus, the President may
even appoint in an acting capacity a person not yet in the government
service, as long as the President deems that person competent.
Petitioners assert that Section 17 does not apply to appointments
vested in the President by the Constitution, because it only applies to
appointments vested in the President by law. Petitioners forget that
G.R. No. 96541 August 24, 1993
DEAN JOSE JOYA, CARMEN GUERRERO NAKPIL, ARMIDA
SIGUION REYNA, PROF. RICARTE M. PURUGANAN, IRMA
POTENCIANO, ADRIAN CRISTOBAL, INGRID SANTAMARIA,
CORAZON FIEL, AMBASSADOR E. AGUILAR CRUZ, FLORENCIO
R. JACELA, JR., MAURO MALANG, FEDERICO AGUILAR ALCUAZ,
LUCRECIA R. URTULA, SUSANO GONZALES, STEVE SANTOS,
EPHRAIM SAMSON, SOLER SANTOS, ANG KIU KOK, KERIMA
POLOTAN, LUCRECIA KASILAG, LIGAYA DAVID PEREZ, VIRGILIO
ALMARIO, LIWAYWAY A. ARCEO, CHARITO PLANAS, HELENA
BENITEZ, ANNA MARIA L. HARPER, ROSALINDA OROSA, SUSAN
CALO MEDINA, PATRICIA RUIZ, BONNIE RUIZ, NELSON
NAVARRO, MANDY NAVASERO, ROMEO SALVADOR, JOSEPHINE
DARANG, and PAZ VETO PLANAS, petitioners,
vs.
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT (PCGG),
CATALINO MACARAIG, JR., in his official capacity, and/or the
Executive Secretary, and CHAIRMAN MATEO A.T. CAPARAS,
respondents.
M.M. Lazaro & Associates for petitioners.
The Solicitor General for respondents.
BELLOSILLO, J.:
All thirty-five (35) petitioners in this Special Civil Action for Prohibition
and Mandamus with Prayer for Preliminary Injunction and/or
Restraining Order seek to enjoin the Presidential Commission on Good
Government (PCGG) from proceeding with the auction sale scheduled
on 11 January 1991 by Christie's of New York of the Old Masters
Paintings and 18th and 19th century silverware seized from
Malacañang and the Metropolitan Museum of Manila and placed in the
custody of the Central Bank.
The antecedents: On 9 August 1990, Mateo A.T. Caparas, then
Chairman of PCGG, wrote then President Corazon C. Aquino,
requesting her for authority to sign the proposed Consignment
Agreement between the Republic of the Philippines through PCGG and
Christie, Manson and Woods International, Inc. (Christie's of New York,
or CHRISTIE'S) concerning the scheduled sale on 11 January 1991 of
eighty-two (82) Old Masters Paintings and antique silverware seized
from Malacañang and the Metropolitan Museum of Manila alleged to be
part of the ill-gotten wealth of the late President Marcos, his relatives
and cronies.
On 14 August 1990, then President Aquino, through former Executive
Secretary Catalino Macaraig, Jr., authorized Chairman Caparas to sign
the Consignment Agreement allowing Christie's of New York to auction
off the subject art pieces for and in behalf of the Republic of the
Philippines.
On 15 August 1990, PCGG, through Chairman Caparas, representing
the Government of the Republic of the Philippines, signed the
Consignment Agreement with Christie's of New York. According to the
agreement, PCGG shall consign to CHRISTIE'S for sale at public
auction the eighty-two (82) Old Masters Paintings then found at the
Metropolitan Museum of Manila as well as the silverware contained in
seventy-one (71) cartons in the custody of the Central Bank of the
Philippines, and such other property as may subsequently be identified
by PCGG and accepted by CHRISTIE'S to be subject to the provisions
of the agreement.1
On 26 October 1990, the Commission on Audit (COA) through then
Chairman Eufemio C. Domingo submitted to President Aquino the audit
findings and observations of COA on the Consignment Agreement of
15 August 1990 to the effect that: (a) the authority of former PCGG
Chairman Caparas to enter into the Consignment Agreement was of
doubtful legality; (b) the contract was highly disadvantageous to the
government; (c) PCGG had a poor track record in asset disposal by
auction in the U.S.; and, (d) the assets subject of auction were historical
relics and had cultural significance, hence, their disposal was prohibited
by law. 2
On 15 November 1990, PCGG through its new Chairman David M.
Castro, wrote President Aquino defending the Consignment Agreement
and refuting the allegations of COA Chairman Domingo.3 On the same
date, Director of National Museum Gabriel S. Casal issued a
certification that the items subject of the Consignment Agreement did
not fall within the classification of protected cultural properties and did
not specifically qualify as part of the Filipino cultural heritage.4 Hence,
this petition originally filed on 7 January 1991 by Dean Jose Joya,
Carmen Guerrero Nakpil, Armida Siguion Reyna, Prof. Ricarte M.
Puruganan, Irma Potenciano, Adrian Cristobal, Ingrid Santamaria,
Corazon Fiel, Ambassador E. Aguilar Cruz, Florencio R. Jacela, Jr.,
Mauro Malang, Federico Aguilar Alcuaz, Lucrecia R. Urtula, Susano
Gonzales, Steve Santos, Ephraim Samson, Soler Santos, Ang Kiu Kok,
Kerima Polotan, Lucrecia Kasilag, Ligaya David Perez, Virgilio Almario
and Liwayway A. Arceo.
After the oral arguments of the parties on 9 January 1991, we issued
immediately our resolution denying the application for preliminary
injunction to restrain the scheduled sale of the artworks on the ground
that petitioners had not presented a clear legal right to a restraining
order and that proper parties had not been impleaded.
On 11 January 1991, the sale at public auction proceeded as
scheduled and the proceeds of $13,302,604.86 were turned over to the
Bureau of Treasury.5
On 5 February 1991, on motion of petitioners, the following were joined
as additional petitioners: Charito Planas, Helena Benitez, Ana Maria L.
Harper, Rosalinda Orosa, Susan Carlo Medina, Patricia Ruiz, Bonnie
Ruiz, Nelson Navarro, Mandy Navasero, Romeo Salvador, Josephine
Darang and Paz Veto Planas.
On the other hand, Catalino Macaraig, Jr., in his capacity as former
Executive Secretary, the incumbent Executive Secretary, and Chairman
Mateo A.T. Caparas were impleaded as additional respondents.
Petitioners raise the following issues: (a) whether petitioners have legal
standing to file the instant petition; (b) whether the Old Masters
Paintings and antique silverware are embraced in the phrase "cultural
treasure of the nation" which is under the protection of the state
pursuant to the 1987 Constitution and/or "cultural properties"
contemplated under R.A. 4846, otherwise known as "The Cultural
Properties Preservation and Protection Act;" (c) whether the paintings
and silverware are properties of public dominion on which can be
disposed of through the joint concurrence of the President and
Congress;
(d) whether respondent, PCGG has the jurisdiction and authority to
enter into an agreement with Christie's of New York for the sale of the
artworks; (e) whether, PCGG has complied with the due process clause
and other statutory requirements for the exportation and sale of the
subject items; and, (f) whether the petition has become moot and
academic, and if so, whether the above issues warrant resolution from
this Court.
The issues being interrelated, they will be discussed jointly hereunder.
However, before proceeding, we wish to emphasize that we admire and
commend petitioners' zealous concern to keep and preserve within the
country great works of art by well-known old masters. Indeed, the value
of art cannot be gainsaid. For, by serving as a creative medium through
which man can express his innermost thoughts and unbridled emotions
while, at the same time, reflecting his deep-seated ideals, art has
become a true expression of beauty, joy, and life itself. Such artistic
creations give us insights into the artists' cultural heritage — the historic
past of the nation and the era to which they belong — in their
triumphant, glorious, as well as troubled and turbulent years. It must be
for this reason that the framers of the 1987 Constitution mandated in
Art. XIV, Sec. 14, that is the solemn duty of the state to "foster the
preservation, enrichment, and dynamic evolution of a Filipino national
culture based on the principle of unity in diversity in a climate of free
artistic and intellectual expression." And, in urging this Court to grant
their petition, petitioners invoke this policy of the state on the protection
of the arts.
But, the altruistic and noble purpose of the petition notwithstanding,
there is that basic legal question which must first be resolved: whether
the instant petition complies with the legal requisites for this Court to
exercise its power of judicial review over this case.
The rule is settled that no question involving the constitutionality or
validity of a law or governmental act may be heard and decided by the
court unless there is compliance with the legal requisites for judicial
inquiry, namely: that the question must be raised by the proper party;
that there must be an actual case or controversy; that the question
must be raised at the earliest possible opportunity; and, that the
decision on the constitutional or legal question must be necessary to
the determination of the case itself.6 But the most important are the first
two (2) requisites.
On the first requisite, we have held that one having no right or interest
to protect cannot invoke the jurisdiction of the court as party-plaintiff in
an
action.7 This is premised on Sec. 2, Rule 3, of the Rules of Court which
provides that every action must be prosecuted and defended in the
name of the real party-in-interest, and that all persons having interest in
the subject of the action and in obtaining the relief demanded shall be
joined as plaintiffs. The Court will exercise its power of judicial review
only if the case is brought before it by a party who has the legal
standing to raise the constitutional or legal question. "Legal standing"
means a personal and substantial interest in the case such that the
party has sustained or will sustain direct injury as a result of the
governmental act that is being challenged. The term "interest" is
material interest, an interest in issue and to be affected by the decree,
as distinguished from mere interest in the question involved, or a mere
incidental interest.8 Moreover, the interest of the party plaintiff must be
personal and not one based on a desire to vindicate the constitutional
right of some third and related party. 9
There are certain instances however when this Court has allowed
exceptions to the rule on legal standing, as when a citizen brings a
case for mandamus to procure the enforcement of a public duty for the
fulfillment of a public right recognized by the Constitution, 10 and when
a taxpayer questions the validity of a governmental act authorizing the
disbursement of public funds. 11
Petitioners claim that as Filipino citizens, taxpayers and artists deeply
concerned with the preservation and protection of the country's artistic
wealth, they have the legal personality to restrain respondents
Executive Secretary and PCGG from acting contrary to their public duty
to conserve the artistic creations as mandated by the 1987 Constitution,
particularly Art. XIV, Secs. 14 to 18, on Arts and Culture, and R.A. 4846
known as "The Cultural Properties Preservation and Protection Act,"
governing the preservation and disposition of national and important
cultural properties. Petitioners also anchor their case on the premise
that the paintings and silverware are public properties collectively
owned by them and by the people in general to view and enjoy as great
works of art. They allege that with the unauthorized act of PCGG in
selling the art pieces, petitioners have been deprived of their right to
public property without due process of law in violation of the
Constitution. 12
Petitioners' arguments are devoid of merit. They lack basis in fact and
in law. They themselves allege that the paintings were donated by
private persons from different parts of the world to the Metropolitan
Museum of Manila Foundation, which is a non-profit and non-stock
corporations established to promote non-Philippine arts. The
foundation's chairman was former First Lady Imelda R. Marcos, while
its president was Bienvenido R. Tantoco. On this basis, the ownership
of these paintings legally belongs to the foundation or corporation or the
members thereof, although the public has been given the opportunity to
view and appreciate these paintings when they were placed on exhibit.
Similarly, as alleged in the petition, the pieces of antique silverware
were given to the Marcos couple as gifts from friends and dignitaries
from foreign countries on their silver wedding and anniversary, an
occasion personal to them. When the Marcos administration was
toppled by the revolutionary government, these paintings and
silverware were taken from Malacañang and the Metropolitan Museum
of Manila and transferred to the Central Bank Museum. The
confiscation of these properties by the Aquino administration however
should not be understood to mean that the ownership of these paintings
has automatically passed on the government without complying with
constitutional and statutory requirements of due process and just
compensation. If these properties were already acquired by the
government, any constitutional or statutory defect in their acquisition
and their subsequent disposition must be raised only by the proper
parties — the true owners thereof — whose authority to recover
emanates from their proprietary rights which are protected by statutes
and the Constitution. Having failed to show that they are the legal
owners of the artworks or that the valued pieces have become publicly
owned, petitioners do not possess any clear legal right whatsoever to
question their alleged unauthorized disposition.
Further, although this action is also one of mandamus filed by
concerned citizens, it does not fulfill the criteria for a mandamus suit. In
Legaspi v. Civil Service Commission, 13 this Court laid down the rule
that a writ of mandamus may be issued to a citizen only when the
public right to be enforced and the concomitant duty of the state are
unequivocably set forth in the Constitution. In the case at bar,
petitioners are not after the fulfillment of a positive duty required of
respondent officials under the 1987 Constitution. What they seek is the
enjoining of an official act because it is constitutionally infirmed.
Moreover, petitioners' claim for the continued enjoyment and
appreciation by the public of the artworks is at most a privilege and is
unenforceable as a constitutional right in this action for mandamus.
Neither can this petition be allowed as a taxpayer's suit. Not every
action filed by a taxpayer can qualify to challenge the legality of official
acts done by the government. A taxpayer's suit can prosper only if the
governmental acts being questioned involve disbursement of public
funds upon the theory that the expenditure of public funds by an officer
of the state for the purpose of administering an unconstitutional act
constitutes a misapplication of such funds, which may be enjoined at
the request of a taxpayer. 14 Obviously, petitioners are not challenging
any expenditure involving public funds but the disposition of what they
allege to be public properties. It is worthy to note that petitioners admit
that the paintings and antique silverware were acquired from private
sources and not with public money.
Anent the second requisite of actual controversy, petitioners argue that
this case should be resolved by this Court as an exception to the rule
on moot and academic cases; that although the sale of the paintings
and silver has long been consummated and the possibility of retrieving
the treasure trove is nil, yet the novelty and importance of the issues
raised by the petition deserve this Court's attention. They submit that
the resolution by the Court of the issues in this case will establish future
guiding principles and doctrines on the preservation of the nation's
priceless artistic and cultural possessions for the benefit of the public as
a whole. 15
For a court to exercise its power of adjudication, there must be an
actual case of controversy — one which involves a conflict of legal
rights, an assertion of opposite legal claims susceptible of judicial
resolution; the case must not be moot or academic or based on extra-
legal or other similar considerations not cognizable by a court of justice.
16 A case becomes moot and academic when its purpose has become
stale, 17 such as the case before us. Since the purpose of this petition
for prohibition is to enjoin respondent public officials from holding the
auction sale of the artworks on a particular date — 11 January 1991 —
which is long past, the issues raised in the petition have become moot
and academic.
At this point, however, we need to emphasize that this Court has the
discretion to take cognizance of a suit which does not satisfy the
requirements of an actual case or legal standing when paramount
public interest is involved. 18 We find however that there is no such
justification in the petition at bar to warrant the relaxation of the rule.
Section 2 of R.A. 4846, as amended by P.D. 374, declares it to be the
policy of the state to preserve and protect the important cultural
properties and national cultural treasures of the nation and to safeguard
their intrinsic value. As to what kind of artistic and cultural properties
are considered by the State as involving public interest which should
therefore be protected, the answer can be gleaned from reading of the
reasons behind the enactment of R.A. 4846:
WHEREAS, the National Museum has the difficult
task, under existing laws and regulations, of
preserving and protecting the cultural properties of
the nation;
WHEREAS, inumerable sites all over the country
have since been excavated for cultural relics, which
have passed on to private hands, representing
priceless cultural treasure that properly belongs to
the Filipino people as their heritage;
WHEREAS, it is perhaps impossible now to find an
area in the Philippines, whether government or
private property, which has not been disturbed by
commercially-minded diggers and collectors, literally
destroying part of our historic past;
WHEREAS, because of this the Philippines has
been charged as incapable of preserving and
protecting her cultural legacies;
WHEREAS, the commercialization of Philippine
relics from the contact period, the Neolithic Age, and
the Paleolithic Age, has reached a point perilously
placing beyond reach of savants the study and
reconstruction of Philippine prehistory; and
WHEREAS, it is believed that more stringent
regulation on movement and a limited form of
registration of important cultural properties and of
designated national cultural treasures is necessary,
and that regardless of the item, any cultural property
exported or sold locally must be registered with the
National Museum to control the deplorable situation
regarding our national cultural properties and to
implement the Cultural Properties Law (emphasis
supplied).
Clearly, the cultural properties of the nation which shall be under the
protection of the state are classified as the "important cultural
properties" and the "national cultural treasures." "Important cultural
properties" are cultural properties which have been singled out from
among the innumerable cultural properties as having exceptional
historical cultural significance to the Philippines but are not sufficiently
outstanding to merit the classification of national cultural treasures. 19
On the other hand, a "national cultural treasures" is a unique object
found locally, possessing outstanding historical, cultural, artistic and/or
scientific value which is highly significant and important to this country
and nation. 20 This Court takes note of the certification issued by the
Director of the Museum that the Italian paintings and silverware subject
of this petition do not constitute protected cultural properties and are
not among those listed in the Cultural Properties Register of the
National Museum.
We agree with the certification of the Director of the Museum. Under
the law, it is the Director of the Museum who is authorized to undertake
the inventory, registration, designation or classification, with the aid of
competent experts, of important cultural properties and national cultural
treasures. 21 Findings of administrative officials and agencies who
have acquired expertise because their jurisdiction is confined to specific
matters are generally accorded not only respect but at times even
finality if such findings are supported by substantial evidence and are
controlling on the reviewing authorities because of their acknowledged
expertise in the fields of specialization to which they are assigned. 22
In view of the foregoing, this Court finds no compelling reason to grant
the petition. Petitioners have failed to show that respondents Executive
Secretary and PCGG exercised their functions with grave abuse of
discretion or in excess of their jurisdiction.
WHEREFORE, for lack of merit, the petition for prohibition and
mandamus is DISMISSED.
SO ORDERED.
G.R. No. 155001            May 5, 2003
DEMOSTHENES P. AGAN, JR., JOSEPH B. CATAHAN, JOSE MARI
B. REUNILLA, MANUEL ANTONIO B. BOÑE, MAMERTO S. CLARA,
REUEL E. DIMALANTA, MORY V. DOMALAON, CONRADO G.
DIMAANO, LOLITA R. HIZON, REMEDIOS P. ADOLFO,
BIENVENIDO C. HILARIO, MIASCOR WORKERS UNION -
NATIONAL LABOR UNION (MWU-NLU), and PHILIPPINE AIRLINES
EMPLOYEES ASSOCIATION (PALEA), petitioners,
vs.
PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., MANILA
INTERNATIONAL AIRPORT AUTHORITY, DEPARTMENT OF
TRANSPORTATION AND COMMUNICATIONS and SECRETARY
LEANDRO M. MENDOZA, in his capacity as Head of the
Department of Transportation and Communications, respondents,
MIASCOR GROUNDHANDLING CORPORATION, DNATA-WINGS
AVIATION SYSTEMS CORPORATION, MACROASIA-EUREST
SERVICES, INC., MACROASIA-MENZIES AIRPORT SERVICES
CORPORATION, MIASCOR CATERING SERVICES CORPORATION,
MIASCOR AIRCRAFT MAINTENANCE CORPORATION, and
MIASCOR LOGISTICS CORPORATION, petitioners-in-intervention,
x---------------------------------------------------------x
G.R. No. 155547 May 5, 2003
SALACNIB F. BATERINA, CLAVEL A. MARTINEZ and
CONSTANTINO G. JARAULA, petitioners,
vs.
PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., MANILA
INTERNATIONAL AIRPORT AUTHORITY, DEPARTMENT OF
TRANSPORTATION AND COMMUNICATIONS, DEPARTMENT OF
PUBLIC WORKS AND HIGHWAYS, SECRETARY LEANDRO M.
MENDOZA, in his capacity as Head of the Department of
Transportation and Communications, and SECRETARY SIMEON
A. DATUMANONG, in his capacity as Head of the Department of
Public Works and Highways, respondents,
JACINTO V. PARAS, RAFAEL P. NANTES, EDUARDO C. ZIALCITA,
WILLY BUYSON VILLARAMA, PROSPERO C. NOGRALES,
PROSPERO A. PICHAY, JR., HARLIN CAST ABAYON, and
BENASING O. MACARANBON, respondents-intervenors,
x---------------------------------------------------------x
G.R. No. 155661 May 5, 2003
CEFERINO C. LOPEZ, RAMON M. SALES, ALFREDO B. VALENCIA,
MA. TERESA V. GAERLAN, LEONARDO DE LA ROSA, DINA C. DE
LEON, VIRGIE CATAMIN RONALD SCHLOBOM, ANGELITO
SANTOS, MA. LUISA M. PALCON and SAMAHANG
MANGGAGAWA SA PALIPARAN NG PILIPINAS (SMPP), petitioners,
vs.
PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., MANILA
INTERNATIONAL AIRPORT AUTHORITY, DEPARTMENT OF
TRANSPORTATION AND COMMUNICATIONS, SECRETARY
LEANDRO M. MENDOZA, in his capacity as Head of the
Department of Transportation and Communications, respondents.
PUNO, J.:
Petitioners and petitioners-in-intervention filed the instant petitions for
prohibition under Rule 65 of the Revised Rules of Court seeking to
prohibit the Manila International Airport Authority (MIAA) and the
Department of Transportation and Communications (DOTC) and its
Secretary from implementing the following agreements executed by the
Philippine Government through the DOTC and the MIAA and the
Philippine International Air Terminals Co., Inc. (PIATCO): (1) the
Concession Agreement signed on July 12, 1997, (2) the Amended and
Restated Concession Agreement dated November 26, 1999, (3) the
First Supplement to the Amended and Restated Concession
Agreement dated August 27, 1999, (4) the Second Supplement to the
Amended and Restated Concession Agreement dated September 4,
2000, and (5) the Third Supplement to the Amended and Restated
Concession Agreement dated June 22, 2001 (collectively, the PIATCO
Contracts).
The facts are as follows:
In August 1989, the DOTC engaged the services of Aeroport
de Paris (ADP) to conduct a comprehensive study of the
Ninoy Aquino International Airport (NAIA) and determine
whether the present airport can cope with the traffic
development up to the year 2010. The study consisted of two
parts: first, traffic forecasts, capacity of existing facilities, NAIA
future requirements, proposed master plans and development
plans; and second, presentation of the preliminary design of
the passenger terminal building. The ADP submitted a Draft
Final Report to the DOTC in December 1989.
Some time in 1993, six business leaders consisting of John
Gokongwei, Andrew Gotianun, Henry Sy, Sr., Lucio Tan,
George Ty and Alfonso Yuchengco met with then President
Fidel V. Ramos to explore the possibility of investing in the
construction and operation of a new international airport
terminal. To signify their commitment to pursue the project,
they formed the Asia's Emerging Dragon Corp. (AEDC) which
was registered with the Securities and Exchange Commission
(SEC) on September 15, 1993.
On October 5, 1994, AEDC submitted an unsolicited proposal
to the Government through the DOTC/MIAA for the
development of NAIA International Passenger Terminal III
(NAIA IPT III) under a build-operate-and-transfer arrangement
pursuant to RA 6957 as amended by RA 7718 (BOT Law).1
On December 2, 1994, the DOTC issued Dept. Order No. 94-832
constituting the Prequalification Bids and Awards Committee (PBAC)
for the implementation of the NAIA IPT III project.
On March 27, 1995, then DOTC Secretary Jose Garcia endorsed the
proposal of AEDC to the National Economic and Development Authority
(NEDA). A revised proposal, however, was forwarded by the DOTC to
NEDA on December 13, 1995. On January 5, 1996, the NEDA
Investment Coordinating Council (NEDA ICC) – Technical Board
favorably endorsed the project to the ICC – Cabinet Committee which
approved the same, subject to certain conditions, on January 19, 1996.
On February 13, 1996, the NEDA passed Board Resolution No. 2 which
approved the NAIA IPT III project.
On June 7, 14, and 21, 1996, DOTC/MIAA caused the publication in
two daily newspapers of an invitation for competitive or comparative
proposals on AEDC's unsolicited proposal, in accordance with Sec. 4-A
of RA 6957, as amended. The alternative bidders were required to
submit three (3) sealed envelopes on or before 5:00 p.m. of September
20, 1996. The first envelope should contain the Prequalification
Documents, the second envelope the Technical Proposal, and the third
envelope the Financial Proposal of the proponent.
On June 20, 1996, PBAC Bulletin No. 1 was issued, postponing the
availment of the Bid Documents and the submission of the comparative
bid proposals. Interested firms were permitted to obtain the Request for
Proposal Documents beginning June 28, 1996, upon submission of a
written application and payment of a non-refundable fee of P50,000.00
(US$2,000).
The Bid Documents issued by the PBAC provided among others that
the proponent must have adequate capability to sustain the financing
requirement for the detailed engineering, design, construction,
operation, and maintenance phases of the project. The proponent
would be evaluated based on its ability to provide a minimum amount of
equity to the project, and its capacity to secure external financing for
the project.
On July 23, 1996, the PBAC issued PBAC Bulletin No. 2 inviting all
bidders to a pre-bid conference on July 29, 1996.
On August 16, 1996, the PBAC issued PBAC Bulletin No. 3 amending
the Bid Documents. The following amendments were made on the Bid
Documents:
a. Aside from the fixed Annual Guaranteed Payment, the
proponent shall include in its financial proposal an additional
percentage of gross revenue share of the Government, as
follows:
i. First 5 years 5.0%
ii. Next 10 years 7.5%
iii. Next 10 years 10.0
b. The amount of the fixed Annual Guaranteed Payment shall
be subject of the price challenge. Proponent may offer an
Annual Guaranteed Payment which need not be of equal
amount, but payment of which shall start upon site
possession.
c. The project proponent must have adequate capability to
sustain the financing requirement for the detailed engineering,
design, construction, and/or operation and maintenance
phases of the project as the case may be. For purposes of
pre-qualification, this capability shall be measured in terms of:
i. Proof of the availability of the project proponent
and/or the consortium to provide the minimum
amount of equity for the project; and
ii. a letter testimonial from reputable banks attesting
that the project proponent and/or the members of
the consortium are banking with them, that the
project proponent and/or the members are of good
financial standing, and have adequate resources.
d. The basis for the prequalification shall be the proponent's
compliance with the minimum technical and financial
requirements provided in the Bid Documents and the IRR of
the BOT Law. The minimum amount of equity shall be 30% of
the Project Cost.
e. Amendments to the draft Concession Agreement shall be
issued from time to time. Said amendments shall only cover
items that would not materially affect the preparation of the
proponent's proposal.
On August 29, 1996, the Second Pre-Bid Conference was held where
certain clarifications were made. Upon the request of prospective
bidder People's Air Cargo & Warehousing Co., Inc (Paircargo), the
PBAC warranted that based on Sec. 11.6, Rule 11 of the Implementing
Rules and Regulations of the BOT Law, only the proposed Annual
Guaranteed Payment submitted by the challengers would be revealed
to AEDC, and that the challengers' technical and financial proposals
would remain confidential. The PBAC also clarified that the list of
revenue sources contained in Annex 4.2a of the Bid Documents was
merely indicative and that other revenue sources may be included by
the proponent, subject to approval by DOTC/MIAA. Furthermore, the
PBAC clarified that only those fees and charges denominated as Public
Utility Fees would be subject to regulation, and those charges which
would be actually deemed Public Utility Fees could still be revised,
depending on the outcome of PBAC's query on the matter with the
Department of Justice.
In September 1996, the PBAC issued Bid Bulletin No. 5, entitled
"Answers to the Queries of PAIRCARGO as Per Letter Dated
September 3 and 10, 1996." Paircargo's queries and the PBAC's
responses were as follows:
1. It is difficult for Paircargo and Associates to meet the
required minimum equity requirement as prescribed in
Section 8.3.4 of the Bid Documents considering that the
capitalization of each member company is so structured to
meet the requirements and needs of their current respective
business undertaking/activities. In order to comply with this
equity requirement, Paircargo is requesting PBAC to just
allow each member of (sic) corporation of the Joint Venture to
just execute an agreement that embodies a commitment to
infuse the required capital in case the project is awarded to
the Joint Venture instead of increasing each corporation's
current authorized capital stock just for prequalification
purposes.
In prequalification, the agency is interested in one's financial
capability at the time of prequalification, not future or potential
capability.
A commitment to put up equity once awarded the project is
not enough to establish that "present" financial capability.
However, total financial capability of all member companies of
the Consortium, to be established by submitting the
respective companies' audited financial statements, shall be
acceptable.
2. At present, Paircargo is negotiating with banks and other
institutions for the extension of a Performance Security to the
joint venture in the event that the Concessions Agreement
(sic) is awarded to them. However, Paircargo is being
required to submit a copy of the draft concession as one of
the documentary requirements. Therefore, Paircargo is
requesting that they'd (sic) be furnished copy of the approved
negotiated agreement between the PBAC and the AEDC at
the soonest possible time.
A copy of the draft Concession Agreement is included in the
Bid Documents. Any material changes would be made known
to prospective challengers through bid bulletins. However, a
final version will be issued before the award of contract.
The PBAC also stated that it would require AEDC to sign Supplement C
of the Bid Documents (Acceptance of Criteria and Waiver of Rights to
Enjoin Project) and to submit the same with the required Bid Security.
On September 20, 1996, the consortium composed of People's Air
Cargo and Warehousing Co., Inc. (Paircargo), Phil. Air and Grounds
Services, Inc. (PAGS) and Security Bank Corp. (Security Bank)
(collectively, Paircargo Consortium) submitted their competitive
proposal to the PBAC. On September 23, 1996, the PBAC opened the
first envelope containing the prequalification documents of the
Paircargo Consortium. On the following day, September 24, 1996, the
PBAC prequalified the Paircargo Consortium.
On September 26, 1996, AEDC informed the PBAC in writing of its
reservations as regards the Paircargo Consortium, which include:
a. The lack of corporate approvals and financial capability of
PAIRCARGO;
b. The lack of corporate approvals and financial capability of
PAGS;
c. The prohibition imposed by RA 337, as amended (the
General Banking Act) on the amount that Security Bank could
legally invest in the project;
d. The inclusion of Siemens as a contractor of the
PAIRCARGO Joint Venture, for prequalification purposes; and
e. The appointment of Lufthansa as the facility operator, in
view of the Philippine requirement in the operation of a public
utility.
The PBAC gave its reply on October 2, 1996, informing AEDC that it
had considered the issues raised by the latter, and that based on the
documents submitted by Paircargo and the established prequalification
criteria, the PBAC had found that the challenger, Paircargo, had
prequalified to undertake the project. The Secretary of the DOTC
approved the finding of the PBAC.
The PBAC then proceeded with the opening of the second envelope of
the Paircargo Consortium which contained its Technical Proposal.
On October 3, 1996, AEDC reiterated its objections, particularly with
respect to Paircargo's financial capability, in view of the restrictions
imposed by Section 21-B of the General Banking Act and Sections
1380 and 1381 of the Manual Regulations for Banks and Other
Financial Intermediaries. On October 7, 1996, AEDC again manifested
its objections and requested that it be furnished with excerpts of the
PBAC meeting and the accompanying technical evaluation report
where each of the issues they raised were addressed.
On October 16, 1996, the PBAC opened the third envelope submitted
by AEDC and the Paircargo Consortium containing their respective
financial proposals. Both proponents offered to build the NAIA
Passenger Terminal III for at least $350 million at no cost to the
government and to pay the government: 5% share in gross revenues
for the first five years of operation, 7.5% share in gross revenues for the
next ten years of operation, and 10% share in gross revenues for the
last ten years of operation, in accordance with the Bid Documents.
However, in addition to the foregoing, AEDC offered to pay the
government a total of P135 million as guaranteed payment for 27 years
while Paircargo Consortium offered to pay the government a total of
P17.75 billion for the same period.
Thus, the PBAC formally informed AEDC that it had accepted the price
proposal submitted by the Paircargo Consortium, and gave AEDC 30
working days or until November 28, 1996 within which to match the said
bid, otherwise, the project would be awarded to Paircargo.
As AEDC failed to match the proposal within the 30-day period, then
DOTC Secretary Amado Lagdameo, on December 11, 1996, issued a
notice to Paircargo Consortium regarding AEDC's failure to match the
proposal.
On February 27, 1997, Paircargo Consortium incorporated into
Philippine International Airport Terminals Co., Inc. (PIATCO).
AEDC subsequently protested the alleged undue preference given to
PIATCO and reiterated its objections as regards the prequalification of
PIATCO.
On April 11, 1997, the DOTC submitted the concession agreement for
the second-pass approval of the NEDA-ICC.
On April 16, 1997, AEDC filed with the Regional Trial Court of Pasig a
Petition for Declaration of Nullity of the Proceedings, Mandamus and
Injunction against the Secretary of the DOTC, the Chairman of the
PBAC, the voting members of the PBAC and Pantaleon D. Alvarez, in
his capacity as Chairman of the PBAC Technical Committee.
On April 17, 1997, the NEDA-ICC conducted an ad referendum to
facilitate the approval, on a no-objection basis, of the BOT agreement
between the DOTC and PIATCO. As the ad referendum gathered only
four (4) of the required six (6) signatures, the NEDA merely noted the
agreement.
On July 9, 1997, the DOTC issued the notice of award for the project to
PIATCO.
On July 12, 1997, the Government, through then DOTC Secretary
Arturo T. Enrile, and PIATCO, through its President, Henry T. Go,
signed the "Concession Agreement for the Build-Operate-and-Transfer
Arrangement of the Ninoy Aquino International Airport Passenger
Terminal III" (1997 Concession Agreement). The Government granted
PIATCO the franchise to operate and maintain the said terminal during
the concession period and to collect the fees, rentals and other charges
in accordance with the rates or schedules stipulated in the 1997
Concession Agreement. The Agreement provided that the concession
period shall be for twenty-five (25) years commencing from the in-
service date, and may be renewed at the option of the Government for
a period not exceeding twenty-five (25) years. At the end of the
concession period, PIATCO shall transfer the development facility to
MIAA.
On November 26, 1998, the Government and PIATCO signed an
Amended and Restated Concession Agreement (ARCA). Among the
provisions of the 1997 Concession Agreement that were amended by
the ARCA were: Sec. 1.11 pertaining to the definition of "certificate of
completion"; Sec. 2.05 pertaining to the Special Obligations of GRP;
Sec. 3.02 (a) dealing with the exclusivity of the franchise given to the
Concessionaire; Sec. 4.04 concerning the assignment by
Concessionaire of its interest in the Development Facility; Sec. 5.08 (c)
dealing with the proceeds of Concessionaire's insurance; Sec. 5.10 with
respect to the temporary take-over of operations by GRP; Sec. 5.16
pertaining to the taxes, duties and other imposts that may be levied on
the Concessionaire; Sec. 6.03 as regards the periodic adjustment of
public utility fees and charges; the entire Article VIII concerning the
provisions on the termination of the contract; and Sec. 10.02 providing
for the venue of the arbitration proceedings in case a dispute or
controversy arises between the parties to the agreement.
Subsequently, the Government and PIATCO signed three Supplements
to the ARCA. The First Supplement was signed on August 27, 1999;
the Second Supplement on September 4, 2000; and the Third
Supplement on June 22, 2001 (collectively, Supplements).
The First Supplement to the ARCA amended Sec. 1.36 of the ARCA
defining "Revenues" or "Gross Revenues"; Sec. 2.05 (d) of the ARCA
referring to the obligation of MIAA to provide sufficient funds for the
upkeep, maintenance, repair and/or replacement of all airport facilities
and equipment which are owned or operated by MIAA; and further
providing additional special obligations on the part of GRP aside from
those already enumerated in Sec. 2.05 of the ARCA. The First
Supplement also provided a stipulation as regards the construction of a
surface road to connect NAIA Terminal II and Terminal III in lieu of the
proposed access tunnel crossing Runway 13/31; the swapping of
obligations between GRP and PIATCO regarding the improvement of
Sales Road; and the changes in the timetable. It also amended Sec.
6.01 (c) of the ARCA pertaining to the Disposition of Terminal Fees;
Sec. 6.02 of the ARCA by inserting an introductory paragraph; and Sec.
6.02 (a) (iii) of the ARCA referring to the Payments of Percentage
Share in Gross Revenues.
The Second Supplement to the ARCA contained provisions concerning
the clearing, removal, demolition or disposal of subterranean structures
uncovered or discovered at the site of the construction of the terminal
by the Concessionaire. It defined the scope of works; it provided for the
procedure for the demolition of the said structures and the
consideration for the same which the GRP shall pay PIATCO; it
provided for time extensions, incremental and consequential costs and
losses consequent to the existence of such structures; and it provided
for some additional obligations on the part of PIATCO as regards the
said structures.
Finally, the Third Supplement provided for the obligations of the
Concessionaire as regards the construction of the surface road
connecting Terminals II and III.
Meanwhile, the MIAA which is charged with the maintenance and
operation of the NAIA Terminals I and II, had existing concession
contracts with various service providers to offer international airline
airport services, such as in-flight catering, passenger handling, ramp
and ground support, aircraft maintenance and provisions, cargo
handling and warehousing, and other services, to several international
airlines at the NAIA. Some of these service providers are the Miascor
Group, DNATA-Wings Aviation Systems Corp., and the MacroAsia
Group. Miascor, DNATA and MacroAsia, together with Philippine
Airlines (PAL), are the dominant players in the industry with an
aggregate market share of 70%.
On September 17, 2002, the workers of the international airline service
providers, claiming that they stand to lose their employment upon the
implementation of the questioned agreements, filed before this Court a
petition for prohibition to enjoin the enforcement of said agreements. 2
On October 15, 2002, the service providers, joining the cause of the
petitioning workers, filed a motion for intervention and a petition-in-
intervention.
On October 24, 2002, Congressmen Salacnib Baterina, Clavel Martinez
and Constantino Jaraula filed a similar petition with this Court. 3
On November 6, 2002, several employees of the MIAA likewise filed a
petition assailing the legality of the various agreements.4
On December 11, 2002. another group of Congressmen, Hon. Jacinto
V. Paras, Rafael P. Nantes, Eduardo C. Zialcita, Willie B. Villarama,
Prospero C. Nograles, Prospero A. Pichay, Jr., Harlin Cast Abayon and
Benasing O. Macaranbon, moved to intervene in the case as
Respondents-Intervenors. They filed their Comment-In-Intervention
defending the validity of the assailed agreements and praying for the
dismissal of the petitions.
During the pendency of the case before this Court, President Gloria
Macapagal Arroyo, on November 29, 2002, in her speech at the 2002
Golden Shell Export Awards at Malacañang Palace, stated that she will
not "honor (PIATCO) contracts which the Executive Branch's legal
offices have concluded (as) null and void."5
Respondent PIATCO filed its Comments to the present petitions on
November 7 and 27, 2002. The Office of the Solicitor General and the
Office of the Government Corporate Counsel filed their respective
Comments in behalf of the public respondents.
On December 10, 2002, the Court heard the case on oral argument.
After the oral argument, the Court then resolved in open court to require
the parties to file simultaneously their respective Memoranda in
amplification of the issues heard in the oral arguments within 30 days
and to explore the possibility of arbitration or mediation as provided in
the challenged contracts.
In their consolidated Memorandum, the Office of the Solicitor General
and the Office of the Government Corporate Counsel prayed that the
present petitions be given due course and that judgment be rendered
declaring the 1997 Concession Agreement, the ARCA and the
Supplements thereto void for being contrary to the Constitution, the
BOT Law and its Implementing Rules and Regulations.
On March 6, 2003, respondent PIATCO informed the Court that on
March 4, 2003 PIATCO commenced arbitration proceedings before the
International Chamber of Commerce, International Court of Arbitration
(ICC) by filing a Request for Arbitration with the Secretariat of the ICC
against the Government of the Republic of the Philippines acting
through the DOTC and MIAA.
In the present cases, the Court is again faced with the task of resolving
complicated issues made difficult by their intersecting legal and
economic implications. The Court is aware of the far reaching fall out
effects of the ruling which it makes today. For more than a century and
whenever the exigencies of the times demand it, this Court has never
shirked from its solemn duty to dispense justice and resolve "actual
controversies involving rights which are legally demandable and
enforceable, and to determine whether or not there has been grave
abuse of discretion amounting to lack or excess of jurisdiction." 6 To be
sure, this Court will not begin to do otherwise today.
We shall first dispose of the procedural issues raised by respondent
PIATCO which they allege will bar the resolution of the instant
controversy.
Petitioners' Legal Standing to File
the present Petitions
a. G.R. Nos. 155001 and 155661
In G.R. No. 155001 individual petitioners are employees of various
service providers7 having separate concession contracts with MIAA and
continuing service agreements with various international airlines to
provide in-flight catering, passenger handling, ramp and ground
support, aircraft maintenance and provisions, cargo handling and
warehousing and other services. Also included as petitioners are labor
unions MIASCOR Workers Union-National Labor Union and Philippine
Airlines Employees Association. These petitioners filed the instant
action for prohibition as taxpayers and as parties whose rights and
interests stand to be violated by the implementation of the PIATCO
Contracts.
Petitioners-Intervenors in the same case are all corporations organized
and existing under Philippine laws engaged in the business of providing
in-flight catering, passenger handling, ramp and ground support, aircraft
maintenance and provisions, cargo handling and warehousing and
other services to several international airlines at the Ninoy Aquino
International Airport. Petitioners-Intervenors allege that as tax-paying
international airline and airport-related service operators, each one of
them stands to be irreparably injured by the implementation of the
PIATCO Contracts. Each of the petitioners-intervenors have separate
and subsisting concession agreements with MIAA and with various
international airlines which they allege are being interfered with and
violated by respondent PIATCO.
In G.R. No. 155661, petitioners constitute employees of MIAA and
Samahang Manggagawa sa Paliparan ng Pilipinas - a legitimate labor
union and accredited as the sole and exclusive bargaining agent of all
the employees in MIAA. Petitioners anchor their petition for prohibition
on the nullity of the contracts entered into by the Government and
PIATCO regarding the build-operate-and-transfer of the NAIA IPT III.
They filed the petition as taxpayers and persons who have a legitimate
interest to protect in the implementation of the PIATCO Contracts.
Petitioners in both cases raise the argument that the PIATCO Contracts
contain stipulations which directly contravene numerous provisions of
the Constitution, specific provisions of the BOT Law and its
Implementing Rules and Regulations, and public policy. Petitioners
contend that the DOTC and the MIAA, by entering into said contracts,
have committed grave abuse of discretion amounting to lack or excess
of jurisdiction which can be remedied only by a writ of prohibition, there
being no plain, speedy or adequate remedy in the ordinary course of
law.
In particular, petitioners assail the provisions in the 1997 Concession
Agreement and the ARCA which grant PIATCO the exclusive right to
operate a commercial international passenger terminal within the Island
of Luzon, except those international airports already existing at the time
of the execution of the agreement. The contracts further provide that
upon the commencement of operations at the NAIA IPT III, the
Government shall cause the closure of Ninoy Aquino International
Airport Passenger Terminals I and II as international passenger
terminals. With respect to existing concession agreements between
MIAA and international airport service providers regarding certain
services or operations, the 1997 Concession Agreement and the ARCA
uniformly provide that such services or operations will not be carried
over to the NAIA IPT III and PIATCO is under no obligation to permit
such carry over except through a separate agreement duly entered into
with PIATCO.8
With respect to the petitioning service providers and their employees,
upon the commencement of operations of the NAIA IPT III, they allege
that they will be effectively barred from providing international airline
airport services at the NAIA Terminals I and II as all international
airlines and passengers will be diverted to the NAIA IPT III. The
petitioning service providers will thus be compelled to contract with
PIATCO alone for such services, with no assurance that subsisting
contracts with MIAA and other international airlines will be respected.
Petitioning service providers stress that despite the very competitive
market, the substantial capital investments required and the high rate of
fees, they entered into their respective contracts with the MIAA with the
understanding that the said contracts will be in force for the stipulated
period, and thereafter, renewed so as to allow each of the petitioning
service providers to recoup their investments and obtain a reasonable
return thereon.
Petitioning employees of various service providers at the NAIA
Terminals I and II and of MIAA on the other hand allege that with the
closure of the NAIA Terminals I and II as international passenger
terminals under the PIATCO Contracts, they stand to lose employment.
The question on legal standing is whether such parties have "alleged
such a personal stake in the outcome of the controversy as to assure
that concrete adverseness which sharpens the presentation of issues
upon which the court so largely depends for illumination of difficult
constitutional questions."9 Accordingly, it has been held that the interest
of a person assailing the constitutionality of a statute must be direct and
personal. He must be able to show, not only that the law or any
government act is invalid, but also that he sustained or is in imminent
danger of sustaining some direct injury as a result of its enforcement,
and not merely that he suffers thereby in some indefinite way. It must
appear that the person complaining has been or is about to be denied
some right or privilege to which he is lawfully entitled or that he is about
to be subjected to some burdens or penalties by reason of the statute
or act complained of.10
We hold that petitioners have the requisite standing. In the above-
mentioned cases, petitioners have a direct and substantial interest to
protect by reason of the implementation of the PIATCO Contracts. They
stand to lose their source of livelihood, a property right which is
zealously protected by the Constitution. Moreover, subsisting
concession agreements between MIAA and petitioners-intervenors and
service contracts between international airlines and petitioners-
intervenors stand to be nullified or terminated by the operation of the
NAIA IPT III under the PIATCO Contracts. The financial prejudice
brought about by the PIATCO Contracts on petitioners and petitioners-
intervenors in these cases are legitimate interests sufficient to confer on
them the requisite standing to file the instant petitions.
b. G.R. No. 155547
In G.R. No. 155547, petitioners filed the petition for prohibition as
members of the House of Representatives, citizens and taxpayers.
They allege that as members of the House of Representatives, they are
especially interested in the PIATCO Contracts, because the contracts
compel the Government and/or the House of Representatives to
appropriate funds necessary to comply with the provisions therein. 11
They cite provisions of the PIATCO Contracts which require
disbursement of unappropriated amounts in compliance with the
contractual obligations of the Government. They allege that the
Government obligations in the PIATCO Contracts which compel
government expenditure without appropriation is a curtailment of their
prerogatives as legislators, contrary to the mandate of the Constitution
that "[n]o money shall be paid out of the treasury except in pursuance
of an appropriation made by law."12
Standing is a peculiar concept in constitutional law because in some
cases, suits are not brought by parties who have been personally
injured by the operation of a law or any other government act but by
concerned citizens, taxpayers or voters who actually sue in the public
interest. Although we are not unmindful of the cases of Imus Electric
Co. v. Municipality of Imus13 and Gonzales v. Raquiza14 wherein this
Court held that appropriation must be made only on amounts
immediately demandable, public interest demands that we take a
more liberal view in determining whether the petitioners suing as
legislators, taxpayers and citizens have locus standi to file the
instant petition. In Kilosbayan, Inc. v. Guingona,15 this Court held
"[i]n line with the liberal policy of this Court on locus standi, ordinary
taxpayers, members of Congress, and even association of planters,
and non-profit civic organizations were allowed to initiate and prosecute
actions before this Court to question the constitutionality or validity of
laws, acts, decisions, rulings, or orders of various government agencies
or instrumentalities."16 Further, "insofar as taxpayers' suits are
concerned . . . (this Court) is not devoid of discretion as to whether or
not it should be entertained." 17 As such ". . . even if, strictly speaking,
they [the petitioners] are not covered by the definition, it is still within
the wide discretion of the Court to waive the requirement and so
remove the impediment to its addressing and resolving the serious
constitutional questions raised."18 In view of the serious legal questions
involved and their impact on public interest, we resolve to grant
standing to the petitioners.
Other Procedural Matters
Respondent PIATCO further alleges that this Court is without
jurisdiction to review the instant cases as factual issues are involved
which this Court is ill-equipped to resolve. Moreover, PIATCO alleges
that submission of this controversy to this Court at the first instance is a
violation of the rule on hierarchy of courts. They contend that trial courts
have concurrent jurisdiction with this Court with respect to a special civil
action for prohibition and hence, following the rule on hierarchy of
courts, resort must first be had before the trial courts.
After a thorough study and careful evaluation of the issues involved,
this Court is of the view that the crux of the instant controversy involves
significant legal questions. The facts necessary to resolve these legal
questions are well established and, hence, need not be determined by
a trial court.
The rule on hierarchy of courts will not also prevent this Court from
assuming jurisdiction over the cases at bar. The said rule may be
relaxed when the redress desired cannot be obtained in the appropriate
courts or where exceptional and compelling circumstances justify
availment of a remedy within and calling for the exercise of this Court's
primary jurisdiction.19
It is easy to discern that exceptional circumstances exist in the cases
at bar that call for the relaxation of the rule. Both petitioners and
respondents agree that these cases are of transcendental
importance as they involve the construction and operation of the
country's premier international airport. Moreover, the crucial issues
submitted for resolution are of first impression and they entail the
proper legal interpretation of key provisions of the Constitution, the BOT
Law and its Implementing Rules and Regulations. Thus, considering
the nature of the controversy before the Court, procedural bars may be
lowered to give way for the speedy disposition of the instant cases.
Legal Effect of the Commencement
of Arbitration Proceedings by
PIATCO
There is one more procedural obstacle which must be overcome. The
Court is aware that arbitration proceedings pursuant to Section 10.02 of
the ARCA have been filed at the instance of respondent PIATCO.
Again, we hold that the arbitration step taken by PIATCO will not oust
this Court of its jurisdiction over the cases at bar.
In Del Monte Corporation-USA v. Court of Appeals, 20 even after finding
that the arbitration clause in the Distributorship Agreement in question
is valid and the dispute between the parties is arbitrable, this Court
affirmed the trial court's decision denying petitioner's Motion to
Suspend Proceedings pursuant to the arbitration clause under the
contract. In so ruling, this Court held that as contracts produce legal
effect between the parties, their assigns and heirs, only the parties to
the Distributorship Agreement are bound by its terms, including the
arbitration clause stipulated therein. This Court ruled that arbitration
proceedings could be called for but only with respect to the parties to
the contract in question. Considering that there are parties to the case
who are neither parties to the Distributorship Agreement nor heirs or
assigns of the parties thereto, this Court, citing its previous ruling in
Salas, Jr. v. Laperal Realty Corporation, 21 held that to tolerate the
splitting of proceedings by allowing arbitration as to some of the parties
on the one hand and trial for the others on the other hand would, in
effect, result in multiplicity of suits, duplicitous procedure and
unnecessary delay.22 Thus, we ruled that the interest of justice would
best be served if the trial court hears and adjudicates the case in a
single and complete proceeding.
It is established that petitioners in the present cases who have
presented legitimate interests in the resolution of the controversy are
not parties to the PIATCO Contracts. Accordingly, they cannot be
bound by the arbitration clause provided for in the ARCA and hence,
cannot be compelled to submit to arbitration proceedings. A speedy
and decisive resolution of all the critical issues in the present
controversy, including those raised by petitioners, cannot be
made before an arbitral tribunal. The object of arbitration is precisely
to allow an expeditious determination of a dispute. This objective would
not be met if this Court were to allow the parties to settle the cases by
arbitration as there are certain issues involving non-parties to the
PIATCO Contracts which the arbitral tribunal will not be equipped to
resolve.
Now, to the merits of the instant controversy.
I
Is PIATCO a qualified bidder?
Public respondents argue that the Paircargo Consortium, PIATCO's
predecessor, was not a duly pre-qualified bidder on the unsolicited
proposal submitted by AEDC as the Paircargo Consortium failed to
meet the financial capability required under the BOT Law and the Bid
Documents. They allege that in computing the ability of the Paircargo
Consortium to meet the minimum equity requirements for the project,
the entire net worth of Security Bank, a member of the consortium,
should not be considered.
PIATCO relies, on the other hand, on the strength of the Memorandum
dated October 14, 1996 issued by the DOTC Undersecretary Primitivo
C. Cal stating that the Paircargo Consortium is found to have a
combined net worth of P3,900,000,000.00, sufficient to meet the equity
requirements of the project. The said Memorandum was in response to
a letter from Mr. Antonio Henson of AEDC to President Fidel V. Ramos
questioning the financial capability of the Paircargo Consortium on the
ground that it does not have the financial resources to put up the
required minimum equity of P2,700,000,000.00. This contention is
based on the restriction under R.A. No. 337, as amended or the
General Banking Act that a commercial bank cannot invest in any
single enterprise in an amount more than 15% of its net worth. In the
said Memorandum, Undersecretary Cal opined:
The Bid Documents, as clarified through Bid Bulletin Nos. 3
and 5, require that financial capability will be evaluated based
on total financial capability of all the member companies of
the [Paircargo] Consortium. In this connection, the Challenger
was found to have a combined net worth of
P3,926,421,242.00 that could support a project costing
approximately P13 Billion.
It is not a requirement that the net worth must be
"unrestricted." To impose that as a requirement now will be
nothing less than unfair.
The financial statement or the net worth is not the sole basis
in establishing financial capability. As stated in Bid Bulletin
No. 3, financial capability may also be established by
testimonial letters issued by reputable banks. The Challenger
has complied with this requirement.
To recap, net worth reflected in the Financial Statement
should not be taken as the amount of the money to be used to
answer the required thirty percent (30%) equity of the
challenger but rather to be used in establishing if there is
enough basis to believe that the challenger can comply with
the required 30% equity. In fact, proof of sufficient equity is
required as one of the conditions for award of contract
(Section 12.1 IRR of the BOT Law) but not for pre-
qualification (Section 5.4 of the same document).23
Under the BOT Law, in case of a build-operate-and-transfer
arrangement, the contract shall be awarded to the bidder
"who, having satisfied the minimum financial, technical,
organizational and legal standards" required by the law,
has submitted the lowest bid and most favorable terms of the
project.24 Further, the 1994 Implementing Rules and
Regulations of the BOT Law provide:
Section 5.4 Pre-qualification Requirements.
xxx           xxx           xxx
c. Financial Capability: The project proponent must have
adequate capability to sustain the financing requirements for
the detailed engineering design, construction and/or operation
and maintenance phases of the project, as the case may be.
For purposes of pre-qualification, this capability shall be
measured in terms of (i) proof of the ability of the project
proponent and/or the consortium to provide a minimum
amount of equity to the project, and (ii) a letter
testimonial from reputable banks attesting that the
project proponent and/or members of the consortium are
banking with them, that they are in good financial
standing, and that they have adequate resources. The
government agency/LGU concerned shall determine on a
project-to-project basis and before pre-qualification, the
minimum amount of equity needed. (emphasis supplied)
Pursuant to this provision, the PBAC issued PBAC Bulletin No. 3 dated
August 16, 1996 amending the financial capability requirements for pre-
qualification of the project proponent as follows:
6. Basis of Pre-qualification
The basis for the pre-qualification shall be on the compliance
of the proponent to the minimum technical and financial
requirements provided in the Bid Documents and in the IRR of
the BOT Law, R.A. No. 6957, as amended by R.A. 7718.
The minimum amount of equity to which the proponent's
financial capability will be based shall be thirty percent (30%)
of the project cost instead of the twenty percent (20%)
specified in Section 3.6.4 of the Bid Documents. This is to
correlate with the required debt-to-equity ratio of 70:30 in
Section 2.01a of the draft concession agreement. The debt
portion of the project financing should not exceed 70% of the
actual project cost.
Accordingly, based on the above provisions of law, the Paircargo
Consortium or any challenger to the unsolicited proposal of AEDC has
to show that it possesses the requisite financial capability to
undertake the project in the minimum amount of 30% of the
project cost through (i) proof of the ability to provide a minimum
amount of equity to the project, and (ii) a letter testimonial from
reputable banks attesting that the project proponent or members of the
consortium are banking with them, that they are in good financial
standing, and that they have adequate resources.
As the minimum project cost was estimated to be US$350,000,000.00
or roughly P9,183,650,000.00, 25 the Paircargo Consortium had to show
to the satisfaction of the PBAC that it had the ability to provide the
minimum equity for the project in the amount of at least
P2,755,095,000.00.
Paircargo's Audited Financial Statements as of 1993 and 1994
indicated that it had a net worth of P2,783,592.00 and P3,123,515.00
respectively.26 PAGS' Audited Financial Statements as of 1995 indicate
that it has approximately P26,735,700.00 to invest as its equity for the
project.27 Security Bank's Audited Financial Statements as of 1995
show that it has a net worth equivalent to its capital funds in the amount
of P3,523,504,377.00.28
We agree with public respondents that with respect to Security Bank,
the entire amount of its net worth could not be invested in a single
undertaking or enterprise, whether allied or non-allied in accordance
with the provisions of R.A. No. 337, as amended or the General
Banking Act:
Sec. 21-B. The provisions in this or in any other Act to the
contrary notwithstanding, the Monetary Board, whenever it
shall deem appropriate and necessary to further national
development objectives or support national priority projects,
may authorize a commercial bank, a bank authorized to
provide commercial banking services, as well as a
government-owned and controlled bank, to operate under
an expanded commercial banking authority and by virtue
thereof exercise, in addition to powers authorized for
commercial banks, the powers of an Investment House as
provided in Presidential Decree No. 129, invest in the
equity of a non-allied undertaking, or own a majority or all
of the equity in a financial intermediary other than a
commercial bank or a bank authorized to provide commercial
banking services: Provided, That (a) the total investment in
equities shall not exceed fifty percent (50%) of the net worth
of the bank; (b) the equity investment in any one
enterprise whether allied or non-allied shall not exceed
fifteen percent (15%) of the net worth of the bank; (c) the
equity investment of the bank, or of its wholly or majority-
owned subsidiary, in a single non-allied undertaking shall not
exceed thirty-five percent (35%) of the total equity in the
enterprise nor shall it exceed thirty-five percent (35%) of the
voting stock in that enterprise; and (d) the equity investment in
other banks shall be deducted from the investing bank's net
worth for purposes of computing the prescribed ratio of net
worth to risk assets.
xxx           xxx           xxx
Further, the 1993 Manual of Regulations for Banks provides:
SECTION X383. Other Limitations and Restrictions. — The
following limitations and restrictions shall also apply regarding
equity investments of banks.
a. In any single enterprise. — The equity investments of
banks in any single enterprise shall not exceed at any time
fifteen percent (15%) of the net worth of the investing bank as
defined in Sec. X106 and Subsec. X121.5.
Thus, the maximum amount that Security Bank could validly invest in
the Paircargo Consortium is only P528,525,656.55, representing 15%
of its entire net worth. The total net worth therefore of the Paircargo
Consortium, after considering the maximum amounts that may be
validly invested by each of its members is P558,384,871.55 or only
6.08% of the project cost,29 an amount substantially less than the
prescribed minimum equity investment required for the project in the
amount of P2,755,095,000.00 or 30% of the project cost.
The purpose of pre-qualification in any public bidding is to determine, at
the earliest opportunity, the ability of the bidder to undertake the
project. Thus, with respect to the bidder's financial capacity at the pre-
qualification stage, the law requires the government agency to examine
and determine the ability of the bidder to fund the entire cost of the
project by considering the maximum amounts that each bidder
may invest in the project at the time of pre-qualification.
The PBAC has determined that any prospective bidder for the
construction, operation and maintenance of the NAIA IPT III project
should prove that it has the ability to provide equity in the minimum
amount of 30% of the project cost, in accordance with the 70:30 debt-
to-equity ratio prescribed in the Bid Documents. Thus, in the case of
Paircargo Consortium, the PBAC should determine the maximum
amounts that each member of the consortium may commit for the
construction, operation and maintenance of the NAIA IPT III project at
the time of pre-qualification. With respect to Security Bank, the
maximum amount which may be invested by it would only be 15% of
its net worth in view of the restrictions imposed by the General Banking
Act. Disregarding the investment ceilings provided by applicable law
would not result in a proper evaluation of whether or not a bidder is pre-
qualified to undertake the project as for all intents and purposes, such
ceiling or legal restriction determines the true maximum amount which
a bidder may invest in the project.
Further, the determination of whether or not a bidder is pre-qualified to
undertake the project requires an evaluation of the financial capacity of
the said bidder at the time the bid is submitted based on the required
documents presented by the bidder. The PBAC should not be allowed
to speculate on the future financial ability of the bidder to undertake
the project on the basis of documents submitted. This would open
doors to abuse and defeat the very purpose of a public bidding. This is
especially true in the case at bar which involves the investment of
billions of pesos by the project proponent. The relevant government
authority is duty-bound to ensure that the awardee of the contract
possesses the minimum required financial capability to complete the
project. To allow the PBAC to estimate the bidder's future financial
capability would not secure the viability and integrity of the project. A
restrictive and conservative application of the rules and procedures of
public bidding is necessary not only to protect the impartiality and
regularity of the proceedings but also to ensure the financial and
technical reliability of the project. It has been held that:
The basic rule in public bidding is that bids should be
evaluated based on the required documents submitted before
and not after the opening of bids. Otherwise, the foundation of
a fair and competitive public bidding would be defeated. Strict
observance of the rules, regulations, and guidelines of
the bidding process is the only safeguard to a fair, honest
and competitive public bidding.30
Thus, if the maximum amount of equity that a bidder may invest in
the project at the time the bids are submitted falls short of the
minimum amounts required to be put up by the bidder, said bidder
should be properly disqualified. Considering that at the pre-qualification
stage, the maximum amounts which the Paircargo Consortium may
invest in the project fell short of the minimum amounts prescribed by
the PBAC, we hold that Paircargo Consortium was not a qualified
bidder. Thus the award of the contract by the PBAC to the Paircargo
Consortium, a disqualified bidder, is null and void.
While it would be proper at this juncture to end the resolution of the
instant controversy, as the legal effects of the disqualification of
respondent PIATCO's predecessor would come into play and
necessarily result in the nullity of all the subsequent contracts entered
by it in pursuance of the project, the Court feels that it is necessary to
discuss in full the pressing issues of the present controversy for a
complete resolution thereof.
II
Is the 1997 Concession Agreement valid?
Petitioners and public respondents contend that the 1997 Concession
Agreement is invalid as it contains provisions that substantially depart
from the draft Concession Agreement included in the Bid Documents.
They maintain that a substantial departure from the draft Concession
Agreement is a violation of public policy and renders the 1997
Concession Agreement null and void.
PIATCO maintains, however, that the Concession Agreement attached
to the Bid Documents is intended to be a draft, i.e., subject to change,
alteration or modification, and that this intention was clear to all
participants, including AEDC, and DOTC/MIAA. It argued further that
said intention is expressed in Part C (6) of Bid Bulletin No. 3 issued by
the PBAC which states:
6. Amendments to the Draft Concessions Agreement
Amendments to the Draft Concessions Agreement shall be
issued from time to time. Said amendments shall only cover
items that would not materially affect the preparation of the
proponent's proposal.
By its very nature, public bidding aims to protect the public interest by
giving the public the best possible advantages through open
competition. Thus:
Competition must be legitimate, fair and honest. In the field of
government contract law, competition requires, not only
`bidding upon a common standard, a common basis, upon the
same thing, the same subject matter, the same undertaking,'
but also that it be legitimate, fair and honest; and not
designed to injure or defraud the government.31
An essential element of a publicly bidded contract is that all bidders
must be on equal footing. Not simply in terms of application of the
procedural rules and regulations imposed by the relevant government
agency, but more importantly, on the contract bidded upon. Each bidder
must be able to bid on the same thing. The rationale is obvious. If the
winning bidder is allowed to later include or modify certain provisions in
the contract awarded such that the contract is altered in any material
respect, then the essence of fair competition in the public bidding is
destroyed. A public bidding would indeed be a farce if after the contract
is awarded, the winning bidder may modify the contract and include
provisions which are favorable to it that were not previously made
available to the other bidders. Thus:
It is inherent in public biddings that there shall be a fair
competition among the bidders. The specifications in such
biddings provide the common ground or basis for the bidders.
The specifications should, accordingly, operate equally or
indiscriminately upon all bidders.32
The same rule was restated by Chief Justice Stuart of the Supreme
Court of Minnesota:
The law is well settled that where, as in this case, municipal
authorities can only let a contract for public work to the lowest
responsible bidder, the proposals and specifications therefore
must be so framed as to permit free and full competition. Nor
can they enter into a contract with the best bidder
containing substantial provisions beneficial to him, not
included or contemplated in the terms and specifications
upon which the bids were invited.33
In fact, in the PBAC Bid Bulletin No. 3 cited by PIATCO to support its
argument that the draft concession agreement is subject to
amendment, the pertinent portion of which was quoted above, the
PBAC also clarified that "[s]aid amendments shall only cover items
that would not materially affect the preparation of the proponent's
proposal."
While we concede that a winning bidder is not precluded from
modifying or amending certain provisions of the contract bidded upon,
such changes must not constitute substantial or material
amendments that would alter the basic parameters of the contract
and would constitute a denial to the other bidders of the
opportunity to bid on the same terms. Hence, the determination of
whether or not a modification or amendment of a contract bidded out
constitutes a substantial amendment rests on whether the contract,
when taken as a whole, would contain substantially different terms and
conditions that would have the effect of altering the technical and/or
financial proposals previously submitted by other bidders. The
alterations and modifications in the contract executed between the
government and the winning bidder must be such as to render such
executed contract to be an entirely different contract from the one
that was bidded upon.
In the case of Caltex (Philippines), Inc. v. Delgado Brothers, Inc.,34
this Court quoted with approval the ruling of the trial court that an
amendment to a contract awarded through public bidding, when such
subsequent amendment was made without a new public bidding, is null
and void:
The Court agrees with the contention of counsel for the
plaintiffs that the due execution of a contract after public
bidding is a limitation upon the right of the contracting parties
to alter or amend it without another public bidding, for
otherwise what would a public bidding be good for if after
the execution of a contract after public bidding, the
contracting parties may alter or amend the contract, or
even cancel it, at their will? Public biddings are held for the
protection of the public, and to give the public the best
possible advantages by means of open competition between
the bidders. He who bids or offers the best terms is awarded
the contract subject of the bid, and it is obvious that such
protection and best possible advantages to the public will
disappear if the parties to a contract executed after public
bidding may alter or amend it without another previous public
bidding.35
Hence, the question that comes to fore is this: is the 1997 Concession
Agreement the same agreement that was offered for public bidding, i.e.,
the draft Concession Agreement attached to the Bid Documents? A
close comparison of the draft Concession Agreement attached to the
Bid Documents and the 1997 Concession Agreement reveals that the
documents differ in at least two material respects:
a. Modification on the Public
Utility Revenues and Non-Public
Utility Revenues that may be
collected by PIATCO
The fees that may be imposed and collected by PIATCO under the draft
Concession Agreement and the 1997 Concession Agreement may be
classified into three distinct categories: (1) fees which are subject to
periodic adjustment of once every two years in accordance with a
prescribed parametric formula and adjustments are made effective only
upon written approval by MIAA; (2) fees other than those included in
the first category which maybe adjusted by PIATCO whenever it deems
necessary without need for consent of DOTC/MIAA; and (3) new fees
and charges that may be imposed by PIATCO which have not been
previously imposed or collected at the Ninoy Aquino International
Airport Passenger Terminal I, pursuant to Administrative Order No. 1,
Series of 1993, as amended. The glaring distinctions between the draft
Concession Agreement and the 1997 Concession Agreement lie in the
types of fees included in each category and the extent of the
supervision and regulation which MIAA is allowed to exercise in relation
thereto.
For fees under the first category, i.e., those which are subject to
periodic adjustment in accordance with a prescribed parametric formula
and effective only upon written approval by MIAA, the draft
Concession Agreement includes the following:36
(1) aircraft parking fees;
(2) aircraft tacking fees;
(3) groundhandling fees;
(4) rentals and airline offices;
(5) check-in counter rentals; and
(6) porterage fees.
Under the 1997 Concession Agreement, fees which are subject to
adjustment and effective upon MIAA approval are classified as "Public
Utility Revenues" and include:37
(1) aircraft parking fees;
(2) aircraft tacking fees;
(3) check-in counter fees; and
(4) Terminal Fees.
The implication of the reduced number of fees that are subject to MIAA
approval is best appreciated in relation to fees included in the second
category identified above. Under the 1997 Concession Agreement,
fees which PIATCO may adjust whenever it deems necessary without
need for consent of DOTC/MIAA are "Non-Public Utility Revenues" and
is defined as "all other income not classified as Public Utility Revenues
derived from operations of the Terminal and the Terminal Complex." 38
Thus, under the 1997 Concession Agreement, ground handling fees,
rentals from airline offices and porterage fees are no longer subject to
MIAA regulation.
Further, under Section 6.03 of the draft Concession Agreement,
MIAA reserves the right to regulate (1) lobby and vehicular parking fees
and (2) other new fees and charges that may be imposed by PIATCO.
Such regulation may be made by periodic adjustment and is effective
only upon written approval of MIAA. The full text of said provision is
quoted below:
Section 6.03. Periodic Adjustment in Fees and Charges.
Adjustments in the aircraft parking fees, aircraft tacking fees,
groundhandling fees, rentals and airline offices, check-in-
counter rentals and porterage fees shall be allowed only once
every two years and in accordance with the Parametric
Formula attached hereto as Annex F. Provided that
adjustments shall be made effective only after the written
express approval of the MIAA. Provided, further, that such
approval of the MIAA, shall be contingent only on the
conformity of the adjustments with the above said parametric
formula. The first adjustment shall be made prior to the In-
Service Date of the Terminal.
The MIAA reserves the right to regulate under the
foregoing terms and conditions the lobby and vehicular
parking fees and other new fees and charges as
contemplated in paragraph 2 of Section 6.01 if in its
judgment the users of the airport shall be deprived of a
free option for the services they cover.39
On the other hand, the equivalent provision under the 1997
Concession Agreement reads:
Section 6.03 Periodic Adjustment in Fees and Charges.
xxx           xxx           xxx
(c) Concessionaire shall at all times be judicious in fixing fees
and charges constituting Non-Public Utility Revenues in order
to ensure that End Users are not unreasonably deprived of
services. While the vehicular parking fee, porterage fee
and greeter/well wisher fee constitute Non-Public Utility
Revenues of Concessionaire, GRP may intervene and
require Concessionaire to explain and justify the fee it
may set from time to time, if in the reasonable opinion of
GRP the said fees have become exorbitant resulting in the
unreasonable deprivation of End Users of such services.40
Thus, under the 1997 Concession Agreement, with respect to (1)
vehicular parking fee, (2) porterage fee and (3) greeter/well wisher fee,
all that MIAA can do is to require PIATCO to explain and justify the
fees set by PIATCO. In the draft Concession Agreement, vehicular
parking fee is subject to MIAA regulation and approval under the
second paragraph of Section 6.03 thereof while porterage fee is
covered by the first paragraph of the same provision. There is an
obvious relaxation of the extent of control and regulation by MIAA with
respect to the particular fees that may be charged by PIATCO.
Moreover, with respect to the third category of fees that may be
imposed and collected by PIATCO, i.e., new fees and charges that may
be imposed by PIATCO which have not been previously imposed or
collected at the Ninoy Aquino International Airport Passenger Terminal
I, under Section 6.03 of the draft Concession Agreement MIAA has
reserved the right to regulate the same under the same conditions that
MIAA may regulate fees under the first category, i.e., periodic
adjustment of once every two years in accordance with a prescribed
parametric formula and effective only upon written approval by MIAA.
However, under the 1997 Concession Agreement, adjustment of fees
under the third category is not subject to MIAA regulation.
With respect to terminal fees that may be charged by PIATCO, 41 as
shown earlier, this was included within the category of "Public Utility
Revenues" under the 1997 Concession Agreement. This classification
is significant because under the 1997 Concession Agreement, "Public
Utility Revenues" are subject to an "Interim Adjustment" of fees upon
the occurrence of certain extraordinary events specified in the
agreement.42 However, under the draft Concession Agreement,
terminal fees are not included in the types of fees that may be subject
to "Interim Adjustment."43
Finally, under the 1997 Concession Agreement, "Public Utility
Revenues," except terminal fees, are denominated in US Dollars 44 while
payments to the Government are in Philippine Pesos. In the draft
Concession Agreement, no such stipulation was included. By
stipulating that "Public Utility Revenues" will be paid to PIATCO in US
Dollars while payments by PIATCO to the Government are in Philippine
currency under the 1997 Concession Agreement, PIATCO is able to
enjoy the benefits of depreciations of the Philippine Peso, while being
effectively insulated from the detrimental effects of exchange rate
fluctuations.
When taken as a whole, the changes under the 1997 Concession
Agreement with respect to reduction in the types of fees that are
subject to MIAA regulation and the relaxation of such regulation with
respect to other fees are significant amendments that substantially
distinguish the draft Concession Agreement from the 1997 Concession
Agreement. The 1997 Concession Agreement, in this respect,
clearly gives PIATCO more favorable terms than what was
available to other bidders at the time the contract was bidded out.
It is not very difficult to see that the changes in the 1997 Concession
Agreement translate to direct and concrete financial advantages for
PIATCO which were not available at the time the contract was offered
for bidding. It cannot be denied that under the 1997 Concession
Agreement only "Public Utility Revenues" are subject to MIAA
regulation. Adjustments of all other fees imposed and collected by
PIATCO are entirely within its control. Moreover, with respect to
terminal fees, under the 1997 Concession Agreement, the same is
further subject to "Interim Adjustments" not previously stipulated in the
draft Concession Agreement. Finally, the change in the currency
stipulated for "Public Utility Revenues" under the 1997 Concession
Agreement, except terminal fees, gives PIATCO an added benefit
which was not available at the time of bidding.
b. Assumption by the
Government of the liabilities of
PIATCO in the event of the latter's
default thereof
Under the draft Concession Agreement, default by PIATCO of any of
its obligations to creditors who have provided, loaned or advanced
funds for the NAIA IPT III project does not result in the assumption by
the Government of these liabilities. In fact, nowhere in the said contract
does default of PIATCO's loans figure in the agreement. Such default
does not directly result in any concomitant right or obligation in favor of
the Government.
However, the 1997 Concession Agreement provides:
Section 4.04 Assignment.
xxx           xxx           xxx
(b) In the event Concessionaire should default in the payment
of an Attendant Liability, and the default has resulted in the
acceleration of the payment due date of the Attendant Liability
prior to its stated date of maturity, the Unpaid Creditors and
Concessionaire shall immediately inform GRP in writing of
such default. GRP shall, within one hundred eighty (180)
Days from receipt of the joint written notice of the Unpaid
Creditors and Concessionaire, either (i) take over the
Development Facility and assume the Attendant Liabilities, or
(ii) allow the Unpaid Creditors, if qualified, to be substituted as
concessionaire and operator of the Development Facility in
accordance with the terms and conditions hereof, or
designate a qualified operator acceptable to GRP to operate
the Development Facility, likewise under the terms and
conditions of this Agreement; Provided that if at the end of the
180-day period GRP shall not have served the Unpaid
Creditors and Concessionaire written notice of its choice,
GRP shall be deemed to have elected to take over the
Development Facility with the concomitant assumption of
Attendant Liabilities.
(c) If GRP should, by written notice, allow the Unpaid
Creditors to be substituted as concessionaire, the latter shall
form and organize a concession company qualified to take
over the operation of the Development Facility. If the
concession company should elect to designate an operator for
the Development Facility, the concession company shall in
good faith identify and designate a qualified operator
acceptable to GRP within one hundred eighty (180) days from
receipt of GRP's written notice. If the concession company,
acting in good faith and with due diligence, is unable to
designate a qualified operator within the aforesaid period,
then GRP shall at the end of the 180-day period take over the
Development Facility and assume Attendant Liabilities.
The term "Attendant Liabilities" under the 1997 Concession
Agreement is defined as:
Attendant Liabilities refer to all amounts recorded and from
time to time outstanding in the books of the Concessionaire
 as owing to Unpaid Creditors who have provided, loaned
or advanced funds actually used for the Project, including
all interests, penalties, associated fees, charges, surcharges,
indemnities, reimbursements and other related expenses, and
further including amounts owed by Concessionaire to its
suppliers, contractors and sub-contractors.
Under the above quoted portions of Section 4.04 in relation to the
definition of "Attendant Liabilities," default by PIATCO of its loans
used to finance the NAIA IPT III project triggers the occurrence of
certain events that leads to the assumption by the Government of
the liability for the loans. Only in one instance may the Government
escape the assumption of PIATCO's liabilities, i.e., when the
Government so elects and allows a qualified operator to take over as
Concessionaire. However, this circumstance is dependent on the
existence and availability of a qualified operator who is willing to
take over the rights and obligations of PIATCO under the contract,
a circumstance that is not entirely within the control of the
Government.
Without going into the validity of this provision at this juncture, suffice it
to state that Section 4.04 of the 1997 Concession Agreement may be
considered a form of security for the loans PIATCO has obtained to
finance the project, an option that was not made available in the draft
Concession Agreement. Section 4.04 is an important amendment to the
1997 Concession Agreement because it grants PIATCO a financial
advantage or benefit which was not previously made available
during the bidding process. This financial advantage is a significant
modification that translates to better terms and conditions for PIATCO.
PIATCO, however, argues that the parties to the bidding procedure
acknowledge that the draft Concession Agreement is subject to
amendment because the Bid Documents permit financing or borrowing.
They claim that it was the lenders who proposed the amendments to
the draft Concession Agreement which resulted in the 1997 Concession
Agreement.
We agree that it is not inconsistent with the rationale and purpose of the
BOT Law to allow the project proponent or the winning bidder to obtain
financing for the project, especially in this case which involves the
construction, operation and maintenance of the NAIA IPT III.
Expectedly, compliance by the project proponent of its undertakings
therein would involve a substantial amount of investment. It is therefore
inevitable for the awardee of the contract to seek alternate sources of
funds to support the project. Be that as it may, this Court maintains that
amendments to the contract bidded upon should always conform to the
general policy on public bidding if such procedure is to be faithful to its
real nature and purpose. By its very nature and characteristic,
competitive public bidding aims to protect the public interest by giving
the public the best possible advantages through open competition. 45 It
has been held that the three principles in public bidding are (1) the offer
to the public; (2) opportunity for competition; and (3) a basis for the
exact comparison of bids. A regulation of the matter which excludes
any of these factors destroys the distinctive character of the system and
thwarts the purpose of its adoption. 46 These are the basic parameters
which every awardee of a contract bidded out must conform to,
requirements of financing and borrowing notwithstanding. Thus, upon a
concrete showing that, as in this case, the contract signed by the
government and the contract-awardee is an entirely different contract
from the contract bidded, courts should not hesitate to strike down said
contract in its entirety for violation of public policy on public bidding. A
strict adherence on the principles, rules and regulations on public
bidding must be sustained if only to preserve the integrity and the faith
of the general public on the procedure.
Public bidding is a standard practice for procuring government
contracts for public service and for furnishing supplies and other
materials. It aims to secure for the government the lowest possible
price under the most favorable terms and conditions, to curtail
favoritism in the award of government contracts and avoid suspicion of
anomalies and it places all bidders in equal footing. 47 Any government
action which permits any substantial variance between the
conditions under which the bids are invited and the contract
executed after the award thereof is a grave abuse of discretion
amounting to lack or excess of jurisdiction which warrants proper
judicial action.
In view of the above discussion, the fact that the foregoing substantial
amendments were made on the 1997 Concession Agreement renders
the same null and void for being contrary to public policy. These
amendments convert the 1997 Concession Agreement to an entirely
different agreement from the contract bidded out or the draft
Concession Agreement. It is not difficult to see that the amendments on
(1) the types of fees or charges that are subject to MIAA regulation or
control and the extent thereof and (2) the assumption by the
Government, under certain conditions, of the liabilities of PIATCO
directly translates concrete financial advantages to PIATCO that
were previously not available during the bidding process. These
amendments cannot be taken as merely supplements to or
implementing provisions of those already existing in the draft
Concession Agreement. The amendments discussed above present
new terms and conditions which provide financial benefit to PIATCO
which may have altered the technical and financial parameters of other
bidders had they known that such terms were available.
III
Direct Government Guarantee
Article IV, Section 4.04(b) and (c), in relation to Article 1.06, of the 1997
Concession Agreement provides:
Section 4.04 Assignment
xxx           xxx           xxx
(b) In the event Concessionaire should default in the
payment of an Attendant Liability, and the default resulted
in the acceleration of the payment due date of the Attendant
Liability prior to its stated date of maturity, the Unpaid
Creditors and Concessionaire shall immediately inform GRP
in writing of such default. GRP shall within one hundred eighty
(180) days from receipt of the joint written notice of the
Unpaid Creditors and Concessionaire, either (i) take over the
Development Facility and assume the Attendant Liabilities,
or (ii) allow the Unpaid Creditors, if qualified to be substituted
as concessionaire and operator of the Development facility in
accordance with the terms and conditions hereof, or
designate a qualified operator acceptable to GRP to operate
the Development Facility, likewise under the terms and
conditions of this Agreement; Provided, that if at the end of
the 180-day period GRP shall not have served the Unpaid
Creditors and Concessionaire written notice of its choice,
GRP shall be deemed to have elected to take over the
Development Facility with the concomitant assumption of
Attendant Liabilities.
(c) If GRP, by written notice, allow the Unpaid Creditors to be
substituted as concessionaire, the latter shall form and
organize a concession company qualified to takeover the
operation of the Development Facility. If the concession
company should elect to designate an operator for the
Development Facility, the concession company shall in good
faith identify and designate a qualified operator acceptable to
GRP within one hundred eighty (180) days from receipt of
GRP's written notice. If the concession company, acting in
good faith and with due diligence, is unable to designate a
qualified operator within the aforesaid period, then GRP shall
at the end of the 180-day period take over the Development
Facility and assume Attendant Liabilities.
….
Section 1.06. Attendant Liabilities
Attendant Liabilities refer to all amounts recorded and from
time to time outstanding in the books of the
Concessionaire as owing to Unpaid Creditors who have
provided, loaned or advanced funds actually used for the
Project, including all interests, penalties, associated fees,
charges, surcharges, indemnities, reimbursements and other
related expenses, and further including amounts owed by
Concessionaire to its suppliers, contractors and sub-
contractors.48
It is clear from the above-quoted provisions that Government, in the
event that PIATCO defaults in its loan obligations, is obligated to
pay "all amounts recorded and from time to time outstanding from the
books" of PIATCO which the latter owes to its creditors. 49 These
amounts include "all interests, penalties, associated fees, charges,
surcharges, indemnities, reimbursements and other related
expenses."50 This obligation of the Government to pay PIATCO's
creditors upon PIATCO's default would arise if the Government opts to
take over NAIA IPT III. It should be noted, however, that even if the
Government chooses the second option, which is to allow PIATCO's
unpaid creditors operate NAIA IPT III, the Government is still at a risk of
being liable to PIATCO's creditors should the latter be unable to
designate a qualified operator within the prescribed period. 51 In effect,
whatever option the Government chooses to take in the event of
PIATCO's failure to fulfill its loan obligations, the Government is
still at a risk of assuming PIATCO's outstanding loans. This is due
to the fact that the Government would only be free from assuming
PIATCO's debts if the unpaid creditors would be able to designate a
qualified operator within the period provided for in the contract. Thus,
the Government's assumption of liability is virtually out of its
control. The Government under the circumstances provided for in the
1997 Concession Agreement is at the mercy of the existence,
availability and willingness of a qualified operator. The above
contractual provisions constitute a direct government guarantee which
is prohibited by law.
One of the main impetus for the enactment of the BOT Law is the lack
of government funds to construct the infrastructure and development
projects necessary for economic growth and development. This is why
private sector resources are being tapped in order to finance these
projects. The BOT law allows the private sector to participate, and is in
fact encouraged to do so by way of incentives, such as minimizing the
unstable flow of returns,52 provided that the government would not have
to unnecessarily expend scarcely available funds for the project itself.
As such, direct guarantee, subsidy and equity by the government in
these projects are strictly prohibited. 53 This is but logical for if the
government would in the end still be at a risk of paying the debts
incurred by the private entity in the BOT projects, then the
purpose of the law is subverted.
Section 2(n) of the BOT Law defines direct guarantee as follows:
(n) Direct government guarantee — An agreement whereby
the government or any of its agencies or local government
units assume responsibility for the repayment of debt
directly incurred by the project proponent in implementing
the project in case of a loan default.
Clearly by providing that the Government "assumes" the attendant
liabilities, which consists of PIATCO's unpaid debts, the 1997
Concession Agreement provided for a direct government guarantee for
the debts incurred by PIATCO in the implementation of the NAIA IPT III
project. It is of no moment that the relevant sections are subsumed
under the title of "assignment". The provisions providing for direct
government guarantee which is prohibited by law is clear from the
terms thereof.
The fact that the ARCA superseded the 1997 Concession Agreement
did not cure this fatal defect. Article IV, Section 4.04(c), in relation to
Article I, Section 1.06, of the ARCA provides:
Section 4.04 Security
xxx           xxx           xxx
(c) GRP agrees with Concessionaire (PIATCO) that it shall
negotiate in good faith and enter into direct agreement
with the Senior Lenders, or with an agent of such Senior
Lenders (which agreement shall be subject to the approval of
the Bangko Sentral ng Pilipinas), in such form as may be
reasonably acceptable to both GRP and Senior Lenders, with
regard, inter alia, to the following parameters:
xxx           xxx           xxx
(iv) If the Concessionaire [PIATCO] is in default
under a payment obligation owed to the Senior
Lenders, and as a result thereof the Senior Lenders
have become entitled to accelerate the Senior
Loans, the Senior Lenders shall have the right to
notify GRP of the same, and without prejudice to
any other rights of the Senior Lenders or any Senior
Lenders' agent may have (including without
limitation under security interests granted in favor of
the Senior Lenders), to either in good faith identify
and designate a nominee which is qualified under
sub-clause (viii)(y) below to operate the
Development Facility [NAIA Terminal 3] or transfer
the Concessionaire's [PIATCO] rights and
obligations under this Agreement to a transferee
which is qualified under sub-clause (viii) below;
xxx           xxx           xxx
(vi) if the Senior Lenders, acting in good faith and
using reasonable efforts, are unable to designate a
nominee or effect a transfer in terms and conditions
satisfactory to the Senior Lenders within one
hundred eighty (180) days after giving GRP notice
as referred to respectively in (iv) or (v) above, then
GRP and the Senior Lenders shall endeavor in good
faith to enter into any other arrangement relating to
the Development Facility [NAIA Terminal 3] (other
than a turnover of the Development Facility [NAIA
Terminal 3] to GRP) within the following one
hundred eighty (180) days. If no agreement relating
to the Development Facility [NAIA Terminal 3] is
arrived at by GRP and the Senior Lenders within the
said 180-day period, then at the end thereof the
Development Facility [NAIA Terminal 3] shall be
transferred by the Concessionaire [PIATCO] to
GRP or its designee and GRP shall make a
termination payment to Concessionaire
[PIATCO] equal to the Appraised Value (as
hereinafter defined) of the Development Facility
[NAIA Terminal 3] or the sum of the Attendant
Liabilities, if greater. Notwithstanding Section
8.01(c) hereof, this Agreement shall be deemed
terminated upon the transfer of the Development
Facility [NAIA Terminal 3] to GRP pursuant hereto;
xxx           xxx           xxx
Section 1.06. Attendant Liabilities
Attendant Liabilities refer to all amounts in each case
supported by verifiable evidence from time to time owed or
which may become owing by Concessionaire [PIATCO] to
Senior Lenders or any other persons or entities who have
provided, loaned, or advanced funds or provided financial
facilities to Concessionaire [PIATCO] for the Project [NAIA
Terminal 3], including, without limitation, all principal,
interest, associated fees, charges, reimbursements, and
other related expenses (including the fees, charges and
expenses of any agents or trustees of such persons or
entities), whether payable at maturity, by acceleration or
otherwise, and further including amounts owed by
Concessionaire [PIATCO] to its professional consultants and
advisers, suppliers, contractors and sub-contractors.54
It is clear from the foregoing contractual provisions that in the event that
PIATCO fails to fulfill its loan obligations to its Senior Lenders, the
Government is obligated to directly negotiate and enter into an
agreement relating to NAIA IPT III with the Senior Lenders, should the
latter fail to appoint a qualified nominee or transferee who will take the
place of PIATCO. If the Senior Lenders and the Government are unable
to enter into an agreement after the prescribed period, the Government
must then pay PIATCO, upon transfer of NAIA IPT III to the
Government, termination payment equal to the appraised value of the
project or the value of the attendant liabilities whichever is greater.
Attendant liabilities as defined in the ARCA includes all amounts owed
or thereafter may be owed by PIATCO not only to the Senior Lenders
with whom PIATCO has defaulted in its loan obligations but to all other
persons who may have loaned, advanced funds or provided any other
type of financial facilities to PIATCO for NAIA IPT III. The amount of
PIATCO's debt that the Government would have to pay as a result of
PIATCO's default in its loan obligations -- in case no qualified nominee
or transferee is appointed by the Senior Lenders and no other
agreement relating to NAIA IPT III has been reached between the
Government and the Senior Lenders -- includes, but is not limited to,
"all principal, interest, associated fees, charges, reimbursements, and
other related expenses . . . whether payable at maturity, by acceleration
or otherwise."55
It is clear from the foregoing that the ARCA provides for a direct
guarantee by the government to pay PIATCO's loans not only to
its Senior Lenders but all other entities who provided PIATCO
funds or services upon PIATCO's default in its loan obligation with
its Senior Lenders. The fact that the Government's obligation to pay
PIATCO's lenders for the latter's obligation would only arise after the
Senior Lenders fail to appoint a qualified nominee or transferee does
not detract from the fact that, should the conditions as stated in the
contract occur, the ARCA still obligates the Government to pay any
and all amounts owed by PIATCO to its lenders in connection with
NAIA IPT III. Worse, the conditions that would make the Government
liable for PIATCO's debts is triggered by PIATCO's own default of its
loan obligations to its Senior Lenders to which loan contracts the
Government was never a party to. The Government was not even given
an option as to what course of action it should take in case PIATCO
defaulted in the payment of its senior loans. The Government, upon
PIATCO's default, would be merely notified by the Senior Lenders of
the same and it is the Senior Lenders who are authorized to appoint a
qualified nominee or transferee. Should the Senior Lenders fail to make
such an appointment, the Government is then automatically obligated
to "directly deal and negotiate" with the Senior Lenders regarding NAIA
IPT III. The only way the Government would not be liable for PIATCO's
debt is for a qualified nominee or transferee to be appointed in place of
PIATCO to continue the construction, operation and maintenance of
NAIA IPT III. This "pre-condition", however, will not take the contract
out of the ambit of a direct guarantee by the government as the
existence, availability and willingness of a qualified nominee or
transferee is totally out of the government's control. As such the
Government is virtually at the mercy of PIATCO (that it would not
default on its loan obligations to its Senior Lenders), the Senior Lenders
(that they would appoint a qualified nominee or transferee or agree to
some other arrangement with the Government) and the existence of a
qualified nominee or transferee who is able and willing to take the place
of PIATCO in NAIA IPT III.
The proscription against government guarantee in any form is one
of the policy considerations behind the BOT Law. Clearly, in the
present case, the ARCA obligates the Government to pay for all loans,
advances and obligations arising out of financial facilities extended to
PIATCO for the implementation of the NAIA IPT III project should
PIATCO default in its loan obligations to its Senior Lenders and the
latter fails to appoint a qualified nominee or transferee. This in effect
would make the Government liable for PIATCO's loans should the
conditions as set forth in the ARCA arise. This is a form of direct
government guarantee.
The BOT Law and its implementing rules provide that in order for an
unsolicited proposal for a BOT project may be accepted, the following
conditions must first be met: (1) the project involves a new concept in
technology and/or is not part of the list of priority projects, (2) no direct
government guarantee, subsidy or equity is required, and (3) the
government agency or local government unit has invited by publication
other interested parties to a public bidding and conducted the same. 56
The failure to meet any of the above conditions will result in the denial
of the proposal. It is further provided that the presence of direct
government guarantee, subsidy or equity will "necessarily disqualify a
proposal from being treated and accepted as an unsolicited proposal." 57
The BOT Law clearly and strictly prohibits direct government
guarantee, subsidy and equity in unsolicited proposals that the mere
inclusion of a provision to that effect is fatal and is sufficient to deny the
proposal. It stands to reason therefore that if a proposal can be denied
by reason of the existence of direct government guarantee, then its
inclusion in the contract executed after the said proposal has been
accepted is likewise sufficient to invalidate the contract itself. A
prohibited provision, the inclusion of which would result in the denial of
a proposal cannot, and should not, be allowed to later on be inserted in
the contract resulting from the said proposal. The basic rules of justice
and fair play alone militate against such an occurrence and must not,
therefore, be countenanced particularly in this instance where the
government is exposed to the risk of shouldering hundreds of million of
dollars in debt.
This Court has long and consistently adhered to the legal maxim that
those that cannot be done directly cannot be done indirectly. 58 To
declare the PIATCO contracts valid despite the clear statutory
prohibition against a direct government guarantee would not only
make a mockery of what the BOT Law seeks to prevent -- which is
to expose the government to the risk of incurring a monetary
obligation resulting from a contract of loan between the project
proponent and its lenders and to which the Government is not a
party to -- but would also render the BOT Law useless for what it
seeks to achieve –- to make use of the resources of the private
sector in the "financing, operation and maintenance of
infrastructure and development projects" 59 which are necessary
for national growth and development but which the government,
unfortunately, could ill-afford to finance at this point in time.
IV
Temporary takeover of business affected with public interest
Article XII, Section 17 of the 1987 Constitution provides:
Section 17. In times of national emergency, when the public
interest so requires, the State may, during the emergency and
under reasonable terms prescribed by it, temporarily take over
or direct the operation of any privately owned public utility or
business affected with public interest.
The above provision pertains to the right of the State in times of
national emergency, and in the exercise of its police power, to
temporarily take over the operation of any business affected with public
interest. In the 1986 Constitutional Commission, the term "national
emergency" was defined to include threat from external aggression,
calamities or national disasters, but not strikes "unless it is of such
proportion that would paralyze government service." 60 The duration of
the emergency itself is the determining factor as to how long the
temporary takeover by the government would last. 61 The temporary
takeover by the government extends only to the operation of the
business and not to the ownership thereof. As such the government is
not required to compensate the private entity-owner of the said
business as there is no transfer of ownership, whether permanent
or temporary. The private entity-owner affected by the temporary
takeover cannot, likewise, claim just compensation for the use of the
said business and its properties as the temporary takeover by the
government is in exercise of its police power and not of its power of
eminent domain.
Article V, Section 5.10 (c) of the 1997 Concession Agreement provides:
Section 5.10 Temporary Take-over of operations by GRP.
….
(c) In the event the development Facility or any part thereof
and/or the operations of Concessionaire or any part thereof,
become the subject matter of or be included in any notice,
notification, or declaration concerning or relating to
acquisition, seizure or appropriation by GRP in times of war or
national emergency, GRP shall, by written notice to
Concessionaire, immediately take over the operations of the
Terminal and/or the Terminal Complex. During such take over
by GRP, the Concession Period shall be suspended;
provided, that upon termination of war, hostilities or national
emergency, the operations shall be returned to
Concessionaire, at which time, the Concession period shall
commence to run again. Concessionaire shall be entitled to
reasonable compensation for the duration of the
temporary take over by GRP, which compensation shall
take into account the reasonable cost for the use of the
Terminal and/or Terminal Complex, (which is in the
amount at least equal to the debt service requirements of
Concessionaire, if the temporary take over should occur at
the time when Concessionaire is still servicing debts owed to
project lenders), any loss or damage to the Development
Facility, and other consequential damages. If the parties
cannot agree on the reasonable compensation of
Concessionaire, or on the liability of GRP as aforesaid, the
matter shall be resolved in accordance with Section 10.01
[Arbitration]. Any amount determined to be payable by GRP to
Concessionaire shall be offset from the amount next payable
by Concessionaire to GRP.62
PIATCO cannot, by mere contractual stipulation, contravene the
Constitutional provision on temporary government takeover and
obligate the government to pay "reasonable cost for the use of the
Terminal and/or Terminal Complex."63 Article XII, section 17 of the
1987 Constitution envisions a situation wherein the exigencies of the
times necessitate the government to "temporarily take over or direct the
operation of any privately owned public utility or business affected with
public interest." It is the welfare and interest of the public which is the
paramount consideration in determining whether or not to temporarily
take over a particular business. Clearly, the State in effecting the
temporary takeover is exercising its police power. Police power is the
"most essential, insistent, and illimitable of powers."64 Its exercise
therefore must not be unreasonably hampered nor its exercise be a
source of obligation by the government in the absence of damage due
to arbitrariness of its exercise. 65 Thus, requiring the government to pay
reasonable compensation for the reasonable use of the property
pursuant to the operation of the business contravenes the Constitution.
V
Regulation of Monopolies
A monopoly is "a privilege or peculiar advantage vested in one or more
persons or companies, consisting in the exclusive right (or power) to
carry on a particular business or trade, manufacture a particular article,
or control the sale of a particular commodity." 66 The 1987 Constitution
strictly regulates monopolies, whether private or public, and even
provides for their prohibition if public interest so requires. Article XII,
Section 19 of the 1987 Constitution states:
Sec. 19. The state shall regulate or prohibit monopolies when
the public interest so requires. No combinations in restraint of
trade or unfair competition shall be allowed.
Clearly, monopolies are not per se prohibited by the Constitution but
may be permitted to exist to aid the government in carrying on an
enterprise or to aid in the performance of various services and functions
in the interest of the public.67 Nonetheless, a determination must first
be made as to whether public interest requires a monopoly. As
monopolies are subject to abuses that can inflict severe prejudice to the
public, they are subject to a higher level of State regulation than an
ordinary business undertaking.
In the cases at bar, PIATCO, under the 1997 Concession Agreement
and the ARCA, is granted the "exclusive right to operate a commercial
international passenger terminal within the Island of Luzon" at the NAIA
IPT III.68 This is with the exception of already existing international
airports in Luzon such as those located in the Subic Bay Freeport
Special Economic Zone ("SBFSEZ"), Clark Special Economic Zone
("CSEZ") and in Laoag City. 69 As such, upon commencement of
PIATCO's operation of NAIA IPT III, Terminals 1 and 2 of NAIA would
cease to function as international passenger terminals. This, however,
does not prevent MIAA to use Terminals 1 and 2 as domestic
passenger terminals or in any other manner as it may deem appropriate
except those activities that would compete with NAIA IPT III in the
latter's operation as an international passenger terminal. 70 The right
granted to PIATCO to exclusively operate NAIA IPT III would be for a
period of twenty-five (25) years from the In-Service Date71 and
renewable for another twenty-five (25) years at the option of the
government.72 Both the 1997 Concession Agreement and the ARCA
further provide that, in view of the exclusive right granted to
PIATCO, the concession contracts of the service providers
currently servicing Terminals 1 and 2 would no longer be renewed
and those concession contracts whose expiration are subsequent
to the In-Service Date would cease to be effective on the said
date.73
The operation of an international passenger airport terminal is no doubt
an undertaking imbued with public interest. In entering into a Build–
Operate-and-Transfer contract for the construction, operation and
maintenance of NAIA IPT III, the government has determined that
public interest would be served better if private sector resources were
used in its construction and an exclusive right to operate be granted to
the private entity undertaking the said project, in this case PIATCO.
Nonetheless, the privilege given to PIATCO is subject to reasonable
regulation and supervision by the Government through the MIAA, which
is the government agency authorized to operate the NAIA complex, as
well as DOTC, the department to which MIAA is attached.74
This is in accord with the Constitutional mandate that a monopoly which
is not prohibited must be regulated. 75 While it is the declared policy of
the BOT Law to encourage private sector participation by "providing a
climate of minimum government regulations," 76 the same does not
mean that Government must completely surrender its sovereign power
to protect public interest in the operation of a public utility as a
monopoly. The operation of said public utility can not be done in an
arbitrary manner to the detriment of the public which it seeks to serve.
The right granted to the public utility may be exclusive but the exercise
of the right cannot run riot. Thus, while PIATCO may be authorized to
exclusively operate NAIA IPT III as an international passenger terminal,
the Government, through the MIAA, has the right and the duty to
ensure that it is done in accord with public interest. PIATCO's right to
operate NAIA IPT III cannot also violate the rights of third parties.
Section 3.01(e) of the 1997 Concession Agreement and the ARCA
provide:
3.01 Concession Period
xxx           xxx           xxx
(e) GRP confirms that certain concession agreements
relative to certain services and operations currently being
undertaken at the Ninoy Aquino International Airport
passenger Terminal I have a validity period extending
beyond the In-Service Date. GRP through DOTC/MIAA,
confirms that these services and operations shall not be
carried over to the Terminal and the Concessionaire is under
no legal obligation to permit such carry-over except
through a separate agreement duly entered into with
Concessionaire. In the event Concessionaire becomes
involved in any litigation initiated by any such concessionaire
or operator, GRP undertakes and hereby holds
Concessionaire free and harmless on full indemnity basis
from and against any loss and/or any liability resulting from
any such litigation, including the cost of litigation and the
reasonable fees paid or payable to Concessionaire's counsel
of choice, all such amounts shall be fully deductible by way of
an offset from any amount which the Concessionaire is bound
to pay GRP under this Agreement.
During the oral arguments on December 10, 2002, the
counsel for the petitioners-in-intervention for G.R. No. 155001
stated that there are two service providers whose contracts
are still existing and whose validity extends beyond the In-
Service Date. One contract remains valid until 2008 and the
other until 2010.77
We hold that while the service providers presently operating at NAIA
Terminal 1 do not have an absolute right for the renewal or the
extension of their respective contracts, those contracts whose duration
extends beyond NAIA IPT III's In-Service-Date should not be unduly
prejudiced. These contracts must be respected not just by the parties
thereto but also by third parties. PIATCO cannot, by law and certainly
not by contract, render a valid and binding contract nugatory. PIATCO,
by the mere expedient of claiming an exclusive right to operate, cannot
require the Government to break its contractual obligations to the
service providers. In contrast to the arrastre and stevedoring service
providers in the case of Anglo-Fil Trading Corporation v. Lazaro 78
whose contracts consist of temporary hold-over permits, the affected
service providers in the cases at bar, have a valid and binding contract
with the Government, through MIAA, whose period of effectivity, as well
as the other terms and conditions thereof, cannot be violated.
In fine, the efficient functioning of NAIA IPT III is imbued with public
interest. The provisions of the 1997 Concession Agreement and the
ARCA did not strip government, thru the MIAA, of its right to supervise
the operation of the whole NAIA complex, including NAIA IPT III. As the
primary government agency tasked with the job,79 it is MIAA's
responsibility to ensure that whoever by contract is given the right to
operate NAIA IPT III will do so within the bounds of the law and with
due regard to the rights of third parties and above all, the interest of the
public.
VI
CONCLUSION
In sum, this Court rules that in view of the absence of the requisite
financial capacity of the Paircargo Consortium, predecessor of
respondent PIATCO, the award by the PBAC of the contract for the
construction, operation and maintenance of the NAIA IPT III is null and
void. Further, considering that the 1997 Concession Agreement
contains material and substantial amendments, which amendments had
the effect of converting the 1997 Concession Agreement into an entirely
different agreement from the contract bidded upon, the 1997
Concession Agreement is similarly null and void for being contrary to
public policy. The provisions under Sections 4.04(b) and (c) in relation
to Section 1.06 of the 1997 Concession Agreement and Section 4.04(c)
in relation to Section 1.06 of the ARCA, which constitute a direct
government guarantee expressly prohibited by, among others, the BOT
Law and its Implementing Rules and Regulations are also null and void.
The Supplements, being accessory contracts to the ARCA, are likewise
null and void.
WHEREFORE, the 1997 Concession Agreement, the Amended and
Restated Concession Agreement and the Supplements thereto are set
aside for being null and void.
SO ORDERED.
SEPARATE OPINIONS
VITUG, J.:
This Court is bereft of jurisdiction to hear the petitions at bar. The
Constitution provides that the Supreme Court shall exercise original
jurisdiction over, among other actual controversies, petitions for
certiorari, prohibition, mandamus, quo warranto, and habeas corpus.1
The cases in question, although denominated to be petitions for
prohibition, actually pray for the nullification of the PIATCO contracts
and to restrain respondents from implementing said agreements for
being illegal and unconstitutional.
Section 2, Rule 65 of the Rules of Court states:
"When the proceedings of any tribunal, corporation, board,
officer or person, whether exercising judicial, quasi-judicial or
ministerial functions, are without or in excess of its or his
jurisdiction, or with grave abuse of discretion amounting to
lack or excess of jurisdiction, and there is no appeal or any
other plain, speedy and adequate remedy in the ordinary
course of law, a person aggrieved thereby may file a verified
petition in the proper court, alleging the facts with certainty
and praying that judgment be rendered commanding the
respondent to desist from further proceedings in the action or
matter specified therein, or otherwise granting such incidental
reliefs as law and justice may require."
The rule is explicit. A petition for prohibition may be filed against a
tribunal, corporation, board, officer or person, exercising judicial, quasi-
judicial or ministerial functions. What the petitions seek from
respondents do not involve judicial, quasi-judicial or ministerial
functions. In prohibition, only legal issues affecting the jurisdiction of the
tribunal, board or officer involved may be resolved on the basis of
undisputed facts.2 The parties allege, respectively, contentious
evidentiary facts. It would be difficult, if not anomalous, to decide the
jurisdictional issue on the basis of the contradictory factual submissions
made by the parties.3 As the Court has so often exhorted, it is not a trier
of facts.
The petitions, in effect, are in the nature of actions for declaratory relief
under Rule 63 of the Rules of Court. The Rules provide that any person
interested under a contract may, before breach or violation thereof,
bring an action in the appropriate Regional Trial Court to determine any
question of construction or validity arising, and for a declaration of his
rights or duties thereunder. 4 The Supreme Court assumes no
jurisdiction over petitions for declaratory relief which are cognizable by
regional trial courts.5
As I have so expressed in Tolentino vs. Secretary of Finance, 6
reiterated in Santiago vs. Guingona, Jr.7 , the Supreme Court should
not be thought of as having been tasked with the awesome
responsibility of overseeing the entire bureaucracy. Pervasive and
limitless, such as it may seem to be under the 1987 Constitution,
judicial power still succumbs to the paramount doctrine of separation of
powers. The Court may not at good liberty intrude, in the guise of
sovereign imprimatur, into every affair of government. What
significance can still then remain of the time-honored and widely
acclaimed principle of separation of powers if, at every turn, the Court
allows itself to pass upon at will the disposition of a co-equal,
independent and coordinate branch in our system of government. I
dread to think of the so varied uncertainties that such an undue
interference can lead to.
Accordingly, I vote for the dismissal of the petition.
Quisumbing, and Azcuna, JJ., concur.
PANGANIBAN, J.:
The five contracts for the construction and the operation of Ninoy
Aquino International Airport (NAIA) Terminal III, the subject of the
consolidated Petitions before the Court, are replete with outright
violations of law, public policy and the Constitution. The only proper
thing to do is declare them all null and void ab initio and let the chips fall
where they may. Fiat iustitia ruat coelum.
The facts leading to this controversy are already well presented in the
ponencia. I shall not burden the readers with a retelling thereof.
Instead, I will cut to the chase and directly address the two sets of gut
issues:
1. The first issue is procedural: Does the Supreme Court have original
jurisdiction to hear and decide the Petitions? Corollarily, do petitioners
have locus standi and should this Court decide the cases without any
mandatory referral to arbitration?
2. The second one is substantive in character: Did the subject contracts
violate the Constitution, the laws, and public policy to such an extent as
to render all of them void and inexistent?
My answer to all the above questions is a firm "Yes."
The Procedural Issue:
Jurisdiction, Standing and Arbitration
Definitely and surely, the issues involved in these Petitions are clearly
of transcendental importance and of national interest. The subject
contracts pertain to the construction and the operation of the country's
premiere international airport terminal - an ultramodern world-class
public utility that will play a major role in the country's economic
development and serve to project a positive image of our country
abroad. The five build-operate-&-transfer (BOT) contracts, while
entailing the investment of billions of pesos in capital and the availment
of several hundred millions of dollars in loans, contain provisions that
tend to establish a monopoly, require the disbursements of public funds
sans appropriations, and provide government guarantees in violation of
statutory prohibitions, as well as other provisions equally offensive to
law, public policy and the Constitution. Public interest will inevitably be
affected thereby.
Thus, objections to these Petitions, grounded upon (a) the hierarchy of
courts, (b) the need for arbitration prior to court action, and (c) the
alleged lack of sufficient personality, standing or interest, being in the
main procedural matters, must now be set aside, as they have been in
past cases. This Court must be permitted to perform its constitutional
duty of determining whether the other agencies of government have
acted within the limits of the Constitution and the laws, or if they have
gravely abused the discretion entrusted to them.1
Hierarchy of Courts
The Court has, in the past, held that questions relating to gargantuan
government contracts ought to be settled without delay.2 This holding
applies with greater force to the instant cases. Respondent Piatco is
partly correct in averring that petitioners can obtain relief from the
regional trial courts via an action to annul the contracts.
Nevertheless, the unavoidable consequence of having to await the
rendition and the finality of any such judgment would be a prolonged
state of uncertainty that would be prejudicial to the nation, the parties
and the general public. And, in light of the feared loss of jobs of the
petitioning workers, consequent to the inevitable pretermination of
contracts of the petitioning service providers that will follow upon the
heels of the impending opening of NAIA Terminal III, the need for relief
is patently urgent, and therefore, direct resort to this Court through the
special civil action of prohibition is thus justified.3
Contrary to Piatco's argument that the resolution of the issues raised in
the Petitions will require delving into factual questions, 4 I submit that
their disposition ultimately turns on questions of law. 5 Further, many of
the significant and relevant factual questions can be easily addressed
by an examination of the documents submitted by the parties. In any
event, the Petitions raise some novel questions involving the
application of the amended BOT Law, which this Court has seen fit to
tackle.
Arbitration
Should the dispute be referred to arbitration prior to judicial recourse?
Respondent Piatco claims that Section 10.02 of the Amended and
Restated Concession Agreement (ARCA) provides for arbitration under
the auspices of the International Chamber of Commerce to settle any
dispute or controversy or claim arising in connection with the
Concession Agreement, its amendments and supplements. The
government disagrees, however, insisting that there can be no
arbitration based on Section 10.02 of the ARCA, since all the Piatco
contracts are void ab initio. Therefore, all contractual provisions,
including Section 10.02 of the ARCA, are likewise void, inexistent and
inoperative. To support its stand, the government cites Chavez v.
Presidential Commission on Good Government:6 "The void agreement
will not be rendered operative by the parties' alleged performance
(partial or full) of their respective prestations. A contract that violates
the Constitution and the law is null and void ab initio and vests no rights
and creates no obligations. It produces no legal effect at all."
As will be discussed at length later, the Piatco contracts are indeed void
in their entirety; thus, a resort to the aforesaid provision on arbitration is
unavailing. Besides, petitioners and petitioners-in-intervention have
pointed out that, even granting arguendo that the arbitration clause
remained a valid provision, it still cannot bind them inasmuch as they
are not parties to the Piatco contracts. And in the final analysis, it is
unarguable that the arbitration process provided for under Section
10.02 of the ARCA, to be undertaken by a panel of three (3) arbitrators
appointed in accordance with the Rules of Arbitration of the
International Chamber of Commerce, will not be able to address,
determine and definitively resolve the constitutional and legal questions
that have been raised in the Petitions before us.
Locus Standi
Given this Court's previous decisions in cases of similar import, no one
will seriously doubt that, being taxpayers and members of the House of
Representatives, Petitioners Baterina et al. have locus standi to bring
the Petition in GR No. 155547. In Albano v. Reyes,7 this Court held that
the petitioner therein, suing as a citizen, taxpayer and member of the
House of Representatives, was sufficiently clothed with standing to
bring the suit questioning the validity of the assailed contract. The Court
cited the fact that public interest was involved, in view of the important
role of the Manila International Container Terminal (MICT) in the
country's economic development and the magnitude of the financial
consideration. This, notwithstanding the fact that expenditure of public
funds was not required under the assailed contract.
In the cases presently under consideration, petitioners' personal and
substantial interest in the controversy is shown by the fact that certain
provisions in the Piatco contracts create obligations on the part of
government (through the DOTC and the MIAA) to disburse public funds
without prior congressional appropriations.
Petitioners thus correctly assert that the injury to them has a twofold
aspect: (1) they are adversely affected as taxpayers on account of the
illegal disbursement of public funds; and (2) they are prejudiced qua
legislators, since the contractual provisions requiring the government to
incur expenditures without appropriations also operate as limitations
upon the exclusive power and prerogative of Congress over the public
purse. As members of the House of Representatives, they are actually
deprived of discretion insofar as the inclusion of those items of
expenditure in the budget is concerned. To prevent such encroachment
upon the legislative privilege and obviate injury to the institution of
which they are members, petitioners-legislators have locus standi to
bring suit.
Messrs. Agan et al. and Lopez et al., are likewise taxpayers and thus
possessed of standing to challenge the illegal disbursement of public
funds. Messrs. Agan et al., in particular, are employees (or
representatives of employees) of various service providers that have (1)
existing concession agreements with the MIAA to provide airport
services necessary to the operation of the NAIA and (2) service
agreements to furnish essential support services to the international
airlines operating at the NAIA.
On the other hand, Messrs. Lopez et al. are employees of the MIAA.
These petitioners (Messrs. Agan et al. and Messrs. Lopez et al.) are
confronted with the prospect of being laid off from their jobs and losing
their means of livelihood when their employer-companies are forced to
shut down or otherwise retrench and cut back on manpower. Such
development would result from the imminent implementation of certain
provisions in the contracts that tend toward the creation of a monopoly
in favor of Piatco, its subsidiaries and related companies.
Petitioners-in-intervention are service providers in the business of
furnishing airport-related services to international airlines and
passengers in the NAIA and are therefore competitors of Piatco as far
as that line of business is concerned. On account of provisions in the
Piatco contracts, petitioners-in-intervention have to enter into a written
contract with Piatco so as not to be shut out of NAIA Terminal III and
barred from doing business there. Since there is no provision to ensure
or safeguard free and fair competition, they are literally at its mercy.
They claim injury on account of their deprivation of property (business)
and of the liberty to contract, without due process of law.
And even if petitioners and petitioners-in-intervention were not
sufficiently clothed with legal standing, I have at the outset already
established that, given its impact on the public and on national interest,
this controversy is laden with transcendental importance and
constitutional significance. Hence, I do not hesitate to adopt the same
position as was enunciated in Kilosbayan v. Guingona Jr.8 that "in
cases of transcendental importance, the Court may relax the standing
requirements and allow a suit to prosper even when there is no direct
injury to the party claiming the right of judicial review."9
The Substantive Issue:
Violations of the Constitution and the Laws
From the Outset, the Bidding Process Was Flawed and Tainted
After studying the documents submitted and arguments advanced by
the parties, I have no doubt that, right at the outset, Piatco was not
qualified to participate in the bidding process for the Terminal III project,
but was nevertheless permitted to do so. It even won the bidding and
was helped along by what appears to be a series of collusive and
corrosive acts.
The build-operate-and-transfer (BOT) project for the NAIA Passenger
Terminal III comes under the category of an "unsolicited proposal,"
which is the subject of Section 4-A of the BOT Law. 10 The unsolicited
proposal was originally submitted by the Asia's Emerging Dragon
Corporation (AEDC) to the Department of Transportation and
Communications (DOTC) and the Manila International Airport Authority
(MIAA), which reviewed and approved the proposal.
The draft of the concession agreement as negotiated between AEDC
and DOTC/MIAA was endorsed to the National Economic Development
Authority (NEDA-ICC), which in turn reviewed it on the basis of its
scope, economic viability, financial indicators and risks; and thereafter
approved it for bidding.
The DOTC/MIAA then prepared the Bid Documents, incorporating
therein the negotiated Draft Concession Agreement, and published
invitations for public bidding, i.e., for the submission of comparative or
competitive proposals. Piatco's predecessor-in-interest, the Paircargo
Consortium, was the only company that submitted a competitive bid or
price challenge.
At this point, I must emphasize that the law requires the award of a
BOT project to the bidder that has satisfied the minimum requirements;
and met the technical, financial, organizational and legal standards
provided in the BOT Law. Section 5 of this statute states:
"Sec. 5. Public bidding of projects. - . . .
"In the case of a build-operate-and-transfer arrangement, the
contract shall be awarded to the bidder who, having satisfied
the minimum financial, technical, organizational and legal
standards required by this Act, has submitted the lowest
bid and most favorable terms for the project, based on the
present value of its proposed tolls, fees, rentals and charges
over a fixed term for the facility to be constructed,
 rehabilitated, operated and maintained according to the
prescribed minimum design and performance standards,
plans and specifications. . . ." (Emphasis supplied.)
The same provision requires that the price challenge via public bidding
"must be conducted under a two-envelope/two-stage system: the first
envelope to contain the technical proposal and the second envelope to
contain the financial proposal." Moreover, the 1994 Implementing Rules
and Regulations (IRR) provide that only those bidders that have passed
the prequalification stage are permitted to have their two envelopes
reviewed.
In other words, prospective bidders must prequalify by submitting their
prequalification documents for evaluation; and only the pre-qualified
bidders would be entitled to have their bids opened, evaluated and
appreciated. On the other hand, disqualified bidders are to be informed
of the reason for their disqualification. This procedure was confirmed
and reiterated in the Bid Documents, which I quote thus: "Prequalified
proponents will be considered eligible to move to second stage
technical proposal evaluation. The second and third envelopes of pre-
disqualified proponents will be returned."11
Aside from complying with the legal and technical requirements (track
record or experience of the firm and its key personnel), a project
proponent desiring to prequalify must also demonstrate its financial
capacity to undertake the project. To establish such capability, a
proponent must prove that it is able to raise the minimum amount of
equity required for the project and to procure the loans or financing
needed for it. Section 5.4(c) of the 1994 IRR provides:
"Sec. 5.4. Prequalification Requirements. - To pre-qualify, a
project proponent must comply with the following
requirements:
x x x           x x x           x x x
"c. Financial Capability. The project proponent must have
adequate capability to sustain the financing requirements for
the detailed engineering design, construction, and/or
operation and maintenance phases of the project, as the case
may be. For purposes of prequalification, this capability shall
be measured in terms of: (i) proof of the ability of the project
proponent and/or the consortium to provide a minimum
amount of equity to the project, and (ii) a letter testimonial
from reputable banks attesting that the project proponent
and/or members of the consortium are banking with them, that
they are in good financial standing, and that they have
adequate resources. The government Agency/LGU
concerned shall determine on a project-to-project basis, and
before prequalification, the minimum amount of equity
needed. . . . ." (Italics supplied)
Since the minimum amount of equity for the project was set at 30
percent12 of the minimum project cost of US$350 million, the minimum
amount of equity required of any proponent stood at US$105 million.
Converted to pesos at the exchange rate then of P26.239 to US$1.00
(as quoted by the Bangko Sentral ng Pilipinas), the peso equivalent of
the minimum equity was P2,755,095,000.
However, the combined equity or net worth of the Paircargo consortium
stood at only P558,384,871.55.13 This amount was only slightly over 6
percent of the minimum project cost and very much short of the
required minimum equity, which was equivalent to 30 percent of the
project cost. Such deficiency should have immediately caused the
disqualification of the Paircargo consortium. This matter was brought to
the attention of the Prequalification and Bidding Committee (PBAC).
Notwithstanding the glaring deficiency, DOTC Undersecretary Primitivo
C. Cal, concurrent chair of the PBAC, declared in a Memorandum
dated 14 October 1996 that "the Challenger (Paircargo consortium)
was found to have a combined net worth of P3,926,421,242.00 that
could support a project costing approximately P13 billion." To justify his
conclusion, he asserted: "It is not a requirement that the networth must
be `unrestricted'. To impose this as a requirement now will be nothing
less than unfair."
He further opined, "(T)he networth reflected in the Financial Statement
should not be taken as the amount of money to be used to answer the
required thirty (30%) percent equity of the challenger but rather to be
used in establishing if there is enough basis to believe that the
challenger can comply with the required 30% equity. In fact, proof of
sufficient equity is required as one of the conditions for award of
contract (Sec. 12.1 of IRR of the BOT Law) but not for prequalification
(Sec. 5.4 of same document)."
On the basis of the foregoing dubious declaration, the Paircargo
consortium was deemed prequalified and thus permitted to proceed to
the other stages of the bidding process.
By virtue of the prequalified status conferred upon the Paircargo,
Undersecretary Cal's findings in effect relieved the consortium of the
need to comply with the financial capability requirement imposed by the
BOT Law and IRR. This position is unmistakably and squarely at odds
with the Supreme Court's consistent doctrine emphasizing the strict
application of pertinent rules, regulations and guidelines for the public
bidding process, in order to place each bidder - actual or potential - on
the same footing. Thus, it is unarguably irregular and contrary to the
very concept of public bidding to permit a variance between the
conditions under which bids are invited and those under which
proposals are submitted and approved.
Republic v. Capulong,14 teaches that if one bidder is relieved from
having to conform to the conditions that impose some duty upon it, that
bidder is not contracting in fair competition with those bidders that
propose to be bound by all conditions. The essence of public bidding is,
after all, an opportunity for fair competition and a basis for the precise
comparison of bids.15 Thus, each bidder must bid under the same
conditions; and be subject to the same guidelines, requirements and
limitations. The desired result is to be able to determine the best offer
or lowest bid, all things being equal.
Inasmuch as the Paircargo consortium did not possess the minimum
equity equivalent to 30 percent of the minimum project cost, it should
not have been prequalified or allowed to participate further in the
bidding. The Prequalification and Bidding Committee (PBAC) should
therefore not have opened the two envelopes of the consortium
containing its technical and financial proposals; required AEDC to
match the consortium's bid; 16 or awarded the Concession Agreement
to the consortium's successor-in-interest, Piatco.
As there was effectively no public bidding to speak of, the entire bidding
process having been flawed and tainted from the very outset, therefore,
the award of the concession to Paircargo's successor Piatco was void,
and the Concession Agreement executed with the latter was likewise
void ab initio. For this reason, Piatco cannot and should not be allowed
to benefit from that Agreement.17
AEDC Was Deprived of the Right to Match PIATCO's Price
Challenge
In DOTC PBAC Bid Bulletin No. 4 (par. 3), Undersecretary Cal declared
that, for purposes of matching the price challenge of Piatco, AEDC as
originator of the unsolicited proposal would be permitted access only to
the schedule of proposed Annual Guaranteed Payments submitted by
Piatco, and not to the latter's financial and technical proposals that
constituted the basis for the price challenge in the first place. This was
supposedly in keeping with Section 11.6 of the 1994 IRR, which
provides that proprietary information is to be respected, protected and
treated with utmost confidentiality, and is therefore not to form part of
the bidding/tender and related documents.
This pronouncement, I believe, was a grievous misapplication of the
mentioned provision. The "proprietary information" referred to in
Section 11.6 of the IRR pertains only to the proprietary information of
the originator of an unsolicited proposal, and not to those belonging to a
challenger. The reason for the protection accorded proprietary
information at all is the fact that, according to Section 4-A of the BOT
Law as amended, a proposal qualifies as an "unsolicited proposal"
when it pertains to a project that involves "a new concept or
technology", and/or a project that is not on the government's list of
priority projects.
To be considered as utilizing a new concept or technology, a project
must involve the possession of exclusive rights (worldwide or regional)
over a process; or possession of intellectual property rights over a
design, methodology or engineering concept.18 Patently, the intent of
the BOT Law is to encourage individuals and groups to come up with
creative innovations, fresh ideas and new technology. Hence, the
significance and necessity of protecting proprietary information in
connection with unsolicited proposals. And to make the encouragement
real, the law also extends to such individuals and groups what amounts
to a "right of first refusal" to undertake the project they conceptualized,
involving the use of new technology or concepts, through the
mechanism of matching a price challenge.
A competing bid is never just any figure conjured from out of the blue; it
is arrived at after studying economic, financial, technical and other,
factors; it is likewise based on certain assumptions as to the nature of
the business, the market potentials, the probable demand for the
product or service, the future behavior of cost items, political and other
risks, and so on. It is thus self-evident that in order to be able to
intelligently match a bid or price challenge, a bidder must be given
access to the assumptions and the calculations that went into crafting
the competing bid.
In this instance, the financial and technical proposals of Piatco would
have provided AEDC with the necessary information to enable it to
make a reasonably informed matching bid. To put it more simply, a
bidder unable to access the competitor's assumptions will never figure
out how the competing bid came about; requiring him to "counter-
propose" is like having him shoot at a target in the dark while
blindfolded.
By withholding from AEDC the challenger's financial and technical
proposals containing the critical information it needed, Undersecretary
Cal actually and effectively deprived AEDC of the ability to match the
price challenge. One could say that AEDC did not have the benefit of a
"level playing field." It seems to me, though, that AEDC was actually
shut out of the game altogether.
At the end of the day, the bottom line is that the validity and the
propriety of the award to Piatco had been irreparably impaired.
Delayed Issuance of the Notice of Award Violated the BOT Law
and the IRR
Section 9.5 of the IRR requires that the Notice of Award must indicate
the time frame within which the winner of the bidding (and therefore the
prospective awardee) shall submit the prescribed performance security,
proof of commitment of equity contributions, and indications of sources
of financing (loans); and, in the case of joint ventures, an agreement
showing that the members are jointly and severally responsible for the
obligations of the project proponent under the contract.
The purpose of having a definite and firm timetable for the submission
of the aforementioned requirements is not only to prevent delays in the
project implementation, but also to expose and weed out unqualified
proponents, who might have unceremoniously slipped through the
earlier prequalification process, by compelling them to put their money
where their mouths are, so to speak.
Nevertheless, this provision can be easily circumvented by merely
postponing the actual issuance of the Notice of Award, in order to give
the favored proponent sufficient time to comply with the requirements.
Hence, to avert or minimize the manipulation of the post-bidding
process, the IRR not only set out the precise sequence of events
occurring between the completion of the evaluation of the technical bids
and the issuance of the Notice of Award, but also specified the
timetables for each such event. Definite allowable extensions of time
were provided for, as were the consequences of a failure to meet a
particular deadline.
In particular, Section 9.1 of the 1994 IRR prescribed that within 30
calendar days from the time the second-stage evaluation shall have
been completed, the Committee must come to a decision whether or
not to award the contract and, within 7 days therefrom, the Notice of
Award must be approved by the head of agency or local government
unit (LGU) concerned, and its issuance must follow within another 7
days thereafter.
Section 9.2 of the IRR set the procedure applicable to projects involving
substantial government undertakings as follows: Within 7 days after the
decision to award is made, the draft contract shall be submitted to the
ICC for clearance on a no-objection basis. If the draft contract includes
government undertakings already previously approved, then the
submission shall be for information only.
However, should there be additional or new provisions different from
the original government undertakings, the draft shall have to be
reviewed and approved. The ICC has 15 working days to act thereon,
and unless otherwise specified, its failure to act on the contract within
the specified time frame signifies that the agency or LGU may proceed
with the award. The head of agency or LGU shall approve the Notice of
Award within seven days of the clearance by the ICC on a no-objection
basis, and the Notice itself has to be issued within seven days
thereafter.
The highly regulated time-frames within which the agents of
government were to act evinced the intent to impose upon them the
duty to act expeditiously throughout the process, to the end that the
project be prosecuted and implemented without delay. This regulated
scenario was likewise intended to discourage collusion and
substantially reduce the opportunity for agents of government to abuse
their discretion in the course of the award process.
Despite the clear timetables set out in the IRR, several lengthy and still-
unexplained delays occurred in the award process, as can be observed
from the presentation made by the counsel for public respondents, 19
quoted hereinbelow:
"11 Dec. 1996 - The Paircargo Joint Venture was informed by
the PBAC that AEDC failed to match and that negotiations
preparatory to Notice of Award should be commenced. This
was the decision to award that should have commenced the
running of the 7-day period to approve the Notice of Award,
as per Section 9.1 of the IRR, or to submit the draft contract to
the ICC for approval conformably with Section 9.2.
"01 April 1997 - The PBAC resolved that a copy of the final
draft of the Concession Agreement be submitted to the NEDA
for clearance on a no-objection basis. This resolution came
more than 3 months too late as it should have been made on
the 20th of December 1996 at the latest.
"16 April 1997 - The PBAC resolved that the period of signing
the Concession Agreement be extended by 15 days.
"18 April 1997 - NEDA approved the Concession Agreement.
Again this is more than 3 months too late as the NEDA's
decision should have been released on the 16th of January
1997 or fifteen days after it should have been submitted to it
for review.
"09 July 1997 - The Notice of Award was issued to PIATCO.
Following the provisions of the IRR, the Notice of Award
should have been issued fourteen days after NEDA's
approval, or the 28th of January 1997. In any case, even if it
were to be assumed that the release of NEDA's approval on
the 18th of April was timely, the Notice of Award should have
been issued on the 9th of May 1997. In both cases, therefore,
the release of the Notice of Award occurred in a decidedly
less than timely fashion."
This chronology of events bespeaks an unmistakable disregard, if not
disdain, by the persons in charge of the award process for the time
limitations prescribed by the IRR. Their attitude flies in the face of this
Court's solemn pronouncement in Republic v. Capulong,20 that "strict
observance of the rules, regulations and guidelines of the bidding
process is the only safeguard to a fair, honest and competitive public
bidding."
From the foregoing, the only conclusion that can possibly be drawn is
that the BOT law and its IRR were repeatedly violated with unmitigated
impunity - and by agents of government, no less! On account of such
violation, the award of the contract to Piatco, which undoubtedly gained
time and benefited from the delays, must be deemed null and void from
the beginning.
Further Amendments Resulted in a Substantially Different
Contract, Awarded Without Public Bidding
But the violations and desecrations did not stop there. After the PBAC
made its decision on December 11, 1996 to award the contract to
Piatco, the latter negotiated changes to the Contract bidded out and
ended up with what amounts to a substantially new contract without
any public bidding. This Contract was subsequently further amended
four more times through negotiation and without any bidding. Thus, the
contract actually executed between Piatco and DOTC/MIAA on July 12,
1997 (the Concession Agreement or "CA") differed from the contract
bidded out (the draft concession agreement or "DCA") in the following
very significant respects:
1. The CA inserted stipulations creating a monopoly in favor
of Piatco in the business of providing airport-related services
for international airlines and passengers. 21
2. The CA provided that government is to answer for Piatco's
unpaid loans and debts (lumped under the term Attendant
Liabilities) in the event Piatco fails to pay its senior lenders.22
3. The CA provided that in case of termination of the contract
due to the fault of government, government shall pay all
expenses that Piatco incurred for the project plus the
appraised value of the Terminal.23
4. The CA imposed new and special obligations on
government, including delivery of clean possession of the site
for the terminal; acquisition of additional land at the
government's expense for construction of road networks
required by Piatco's approved plans and specifications; and
assistance to Piatco in securing site utilities, as well as all
necessary permits, licenses and authorizations.24
5. Where Section 3.02 of the DCA requires government to
refrain from competing with the contractor with respect to the
operation of NAIA Terminal III, Section 3.02(b) of the CA
excludes and prohibits everyone, including government, from
directly or indirectly competing with Piatco, with respect to the
operation of, as well as operations in, NAIA Terminal III.
Operations in is sufficiently broad to encompass all retail and
other commercial business enterprises operating within
Terminal III, inclusive of the businesses of providing various
airport-related services to international airlines, within the
scope of the prohibition.
6. Under Section 6.01 of the DCA, the following fees are
subject to the written approval of MIAA: lease/rental charges,
concession privilege fees for passenger services, food
services, transportation utility concessions, groundhandling,
catering and miscellaneous concession fees, porterage fees,
greeter/well-wisher fees, carpark fees, advertising fees, VIP
facilities fees and others. Moreover, adjustments to the
groundhandling fees, rentals and porterage fees are permitted
only once every two years and in accordance with a
parametric formula, per DCA Section 6.03. However, the CA
as executed with Piatco provides in Section 6.06 that all the
aforesaid fees, rentals and charges may be adjusted without
MIAA's approval or intervention. Neither are the adjustments
to these fees and charges subject to or limited by any
parametric formula.25
7. Section 1.29 of the DCA provides that the terminal fees,
aircraft tacking fees, aircraft parking fees, check-in counter
fees and other fees are to be quoted and paid in Philippine
pesos. But per Section 1.33 of the CA, all the aforesaid fees
save the terminal fee are denominated in US Dollars.
8. Under Section 8.07 of the DCA, the term attendant
liabilities refers to liabilities pertinent to NAIA Terminal III,
such as payment of lease rentals and performance of other
obligations under the Land Lease Agreement; the obligations
under the Tenant Agreements; and payment of all taxes, fees,
charges and assessments of whatever kind that may be
imposed on NAIA Terminal III or parts thereof. But in Section
 1.06 of the CA, Attendant Liabilities refers to unpaid debts of
Piatco: "All amounts recorded and from time to time
outstanding in the books of (Piatco) as owing to Unpaid
Creditors who have provided, loaned or advanced funds
actually used for the Project, including all interests, penalties,
associated fees, charges, surcharges, indemnities,
reimbursements and other related expenses, and further
including amounts owed by [Piatco] to its suppliers,
contractors and subcontractors."
9. Per Sections 8.04 and 8.06 of the DCA, government may,
on account of the contractors breach, rescind the contract and
select one of four options: (a) take over the terminal and
assume all its attendant liabilities; (b) allow the contractor's
creditors to assign the Project to another entity acceptable to
DOTC/MIAA; (c) pay the contractor rent for the facilities and
equipment the DOTC may utilize; or (d) purchase the terminal
at a price established by independent appraisers. Depending
on the option selected, government may take immediate
possession and control of the terminal and its operations.
Government will be obligated to compensate the contractor
for the "equivalent or proportionate contract costs actually
disbursed," but only where government is the one in breach of
the contract. But under Section 8.06(a) of the CA, whether on
account of Piatco's breach of contract or its inability to pay its
creditors, government is obliged to either (a) take over
Terminal III and assume all of Piatco's debts or (b) permit the
qualified unpaid creditors to be substituted in place of Piatco
or to designate a new operator. And in the event of
government's breach of contract, Piatco may compel it to
purchase the terminal at fair market value, per Section 8.06(b)
of the CA.
10. Under the DCA, any delay by Piatco in the payment of the
amounts due the government constitutes breach of contract.
However, under the CA, such delay does not necessarily
constitute breach of contract, since Piatco is permitted to
suspend payments to the government in order to first satisfy
the claims of its secured creditors, per Section 8.04(d) of the
CA.
It goes without saying that the amendment of the Contract bidded out
(the DCA or draft concession agreement) - in such substantial manner,
without any public bidding, and after the bidding process had been
concluded on December 11, 1996 - is violative of public policy on public
biddings, as well as the spirit and intent of the BOT Law. The whole
point of going through the public bidding exercise was completely lost.
Its very rationale was totally subverted by permitting Piatco to amend
the contract for which public bidding had already been concluded.
Competitive bidding aims to obtain the best deal possible by fostering
transparency and preventing favoritism, collusion and fraud in the
awarding of contracts. That is the reason why procedural rules
pertaining to public bidding demand strict observance.26
In a relatively early case, Caltex v. Delgado Brothers,27 this Court made
it clear that substantive amendments to a contract for which a public
bidding has already been finished should only be awarded after another
public bidding:
"The due execution of a contract after public bidding is a
limitation upon the right of the contracting parties to alter or
amend it without another public bidding, for otherwise what
would a public bidding be good for if after the execution of a
contract after public bidding, the contracting parties may alter
or amend the contract, or even cancel it, at their will? Public
biddings are held for the protection of the public, and to give
the public the best possible advantages by means of open
competition between the bidders. He who bids or offers the
best terms is awarded the contract subject of the bid, and it is
obvious that such protection and best possible advantages to
the public will disappear if the parties to a contract executed
after public bidding may alter or amend it without another
previous public bidding."28
The aforementioned case dealt with the unauthorized amendment of a
contract executed after public bidding; in the situation before us, the
amendments were made also after the bidding, but prior to execution.
Be that as it may, the same rationale underlying Caltex applies to the
present situation with equal force. Allowing the winning bidder to
renegotiate the contract for which the bidding process has ended is
tantamount to permitting it to put in anything it wants. Here, the winning
bidder (Piatco) did not even bother to wait until after actual execution of
the contract before rushing to amend it. Perhaps it believed that if the
changes were made to a contract already won through bidding (DCA)
instead of waiting until it is executed, the amendments would not be
noticed or discovered by the public.
In a later case, Mata v. San Diego,29 this Court reiterated its ruling as
follows:
"It is true that modification of government contracts, after the
same had been awarded after a public bidding, is not allowed
because such modification serves to nullify the effects of the
bidding and whatever advantages the Government had
secured thereby and may also result in manifest injustice to
the other bidders. This prohibition, however, refers to a
change in vital and essential particulars of the agreement
which results in a substantially new contract."
Piatco's counter-argument may be summed up thus: There was nothing
in the 1994 IRR that prohibited further negotiations and eventual
amendments to the DCA even after the bidding had been concluded. In
fact, PBAC Bid Bulletin No. 3 states: "[A]mendments to the Draft
Concession Agreement shall be issued from time to time. Said
amendments will only cover items that would not materially affect the
preparation of the proponent's proposal."
I submit that accepting such warped argument will result in perverting
the policy underlying public bidding. The BOT Law cannot be said to
allow the negotiation of contractual stipulations resulting in a
substantially new contract after the bidding process and price challenge
had been concluded. In fact, the BOT Law, in recognition of the time,
money and effort invested in an unsolicited proposal, accords its
originator the privilege of matching the challenger's bid.
Section 4-A of the BOT Law specifically refers to a "lower price
proposal" by a competing bidder; and to the right of the original
proponent "to match the price" of the challenger. Thus, only the price
proposals are in play. The terms, conditions and stipulations in the
contract for which public bidding has been concluded are understood to
remain intact and not be subject to further negotiation. Otherwise, the
very essence of public bidding will be destroyed - there will be no basis
for an exact comparison between bids.
Moreover, Piatco misinterpreted the meaning behind PBAC Bid Bulletin
No. 3. The phrase amendments . . . from time to time refers only to
those amendments to the draft concession agreement issued by the
PBAC prior to the submission of the price challenge; it certainly does
not include or permit amendments negotiated for and introduced after
the bidding process, has been terminated.
Piatco's Concession Agreement Was Further Amended, (ARCA)
Again Without Public Bidding
Not satisfied with the Concession Agreement, Piatco - once more
without bothering with public bidding - negotiated with government for
still more substantial changes. The result was the Amended and
Restated Concession Agreement (ARCA) executed on November 26,
1998. The following changes were introduced:
1. The definition of Attendant Liabilities was further amended
with the result that the unpaid loans of Piatco, for which
government may be required to answer, are no longer limited
to only those loans recorded in Piatco's books or loans whose
proceeds were actually used in the Terminal III project.30
2. Although the contract may be terminated due to breach by
Piatco, it will not be liable to pay the government any
Liquidated Damages if a new operator is designated to take
over the operation of the terminal.31
3. The Liquidated Damages which government becomes
liable for in case of its breach of contract were substantially
increased.32
4. Government's right to appoint a comptroller for Piatco in
case the latter encounters liquidity problems was deleted. 33
5. Government is made liable for Incremental and
Consequential Costs and Losses in case it fails to comply or
cause any third party under its direct or indirect control to
comply with the special obligations imposed on government.34
6. The insurance policies obtained by Piatco covering the
terminal are now required to be assigned to the Senior
Lenders as security for the loans; previously, their proceeds
were to be used to repair and rehabilitate the facility in case of
damage.35
7. Government bound itself to set the initial rate of the
terminal fee, to be charged when Terminal III begins
operations, at an amount higher than US$20.36
8. Government waived its defense of the illegality of the
contract and even agreed to be liable to pay damages to
Piatco in the event the contract was declared illegal. 37
9. Even though government may be entitled to terminate the
ARCA on account of breach by Piatco, government is still
liable to pay Piatco the appraised value of Terminal III or the
Attendant Liabilities, if the termination occurs before the In-
Service Date.38 This condition contravenes the BOT Law
provision on termination compensation.
10. Government is obligated to take the administrative action
required for Piatco's imposition, collection and application of
all Public Utility Revenues. 39 No such obligation existed
previously.
11. Government is now also obligated to perform and cause
other persons and entities under its direct or indirect control to
perform all acts necessary to perfect the security interests to
 be created in favor of Piatco's Senior Lenders. 40 No such
obligation existed previously.
12. DOTC/MIAA's right of intervention in instances where
Piatco's Non-Public Utility Revenues become exorbitant or
excessive has been removed.41
13. The illegality and unenforceability of the ARCA or any of
its material provisions was made an event of default on the
part of government only, thus constituting a ground for Piatco
to terminate the ARCA.42
14. Amounts due from and payable by government under the
contract were made payable on demand - net of taxes, levies,
imposts, duties, charges or fees of any kind except as
required by law.43
15. The Parametric Formula in the contract, which is utilized
to compute for adjustments/increases to the public utility
revenues (i.e., aircraft parking and tacking fees, check-in
counter fee and terminal fee), was revised to permit Piatco to
input its more costly short-term borrowing rates instead of the
longer-terms rates in the computations for adjustments, with
the end result that the changes will redound to its greater
financial benefit.
16. The Certificate of Completion simply deleted the
successful performance-testing of the terminal facility in
accordance with defined performance standards as a pre-
condition for government's acceptance of the terminal
facility.44
In sum, the foregoing revisions and amendments as embodied in the
ARCA constitute very material alterations of the terms and conditions of
the CA, and give further manifestly undue advantage to Piatco at the
expense of government. Piatco claims that the changes to the CA were
necessitated by the demands of its foreign lenders. However, no proof
whatsoever has been adduced to buttress this claim.
In any event, it is quite patent that the sum total of the aforementioned
changes resulted in drastically weakening the position of government to
a degree that seems quite excessive, even from the standpoint of a
businessperson who regularly transacts with banks and foreign lenders,
is familiar with their mind-set, and understands what motivates them.
On the other hand, whatever it was that impelled government officials
concerned to accede to those grossly disadvantageous changes, I can
only hazard a guess.
There is no question in my mind that the ARCA was unauthorized and
illegal for lack of public bidding and for being patently disadvantageous
to government.
The Three Supplements Imposed New Obligations on
Government, Also Without Prior Public Bidding
After Piatco had managed to breach the protective rampart of public
bidding, it recklessly went on a rampage of further assaults on the
ARCA.
The First Supplement Is as Void as the ARCA
In the First Supplement ("FS") executed on August 27, 1999, the
following changes were made to the ARCA:
1. The amounts payable by Piatco to government were
reduced by allowing additional exceptions to the Gross
Revenues in which government is supposed to participate.45
2. Made part of the properties which government is obliged to
construct and/or maintain and keep in good repair are (a) the
access road connecting Terminals II and III - the construction
of this access road is the obligation of Piatco, in lieu of its
obligation to construct an Access Tunnel connecting
Terminals II and III; and (b) the taxilane and taxiway - these
are likewise part of Piatco's obligations, since they are part
and parcel of the project as described in Clause 1.3 of the Bid
Documents .46
3. The MIAA is obligated to provide funding for the
maintenance and repair of the airports and facilities owned or
operated by it and by third persons under its control. It will
also be liable to Piatco for the latter's losses, expenses and
damages as well as liability to third persons, in case MIAA
fails to perform such obligations. In addition, MIAA will also be
liable for the incremental and consequential costs of the
remedial work done by Piatco on account of the former's
default.47
4. The FS also imposed on government ten (10) "Additional
Special Obligations," including the following:
(a) Working for the removal of the general aviation
traffic from the NAIA airport complex48
(b) Providing through MIAA the land required by
Piatco for the taxilane and one taxiway at no cost to
Piatco49
(c) Implementing the government's existing storm
drainage master plan50
(d) Coordinating with DPWH the financing, the
implementation and the completion of the following
works before the In-Service Date: three left-turning
overpasses (EDSA to Tramo St., Tramo to Andrews
Ave., and Manlunas Road to Sales Ave.);51 and a
road upgrade and improvement program involving
widening, repair and resurfacing of Sales Road,
Andrews Avenue and Manlunas Road; improvement
of Nichols Interchange; and removal of squatters
along Andrews Avenue.52
(e) Dealing directly with BCDA and the Phil. Air
Force in acquiring additional land or right of way for
the road upgrade and improvement program. 53
5. Government is required to work for the immediate reversion
to MIAA of the Nayong Pilipino National Park.54
6. Government's share in the terminal fees collected was
revised from a flat rate of P180 to 36 percent thereof; together
with government's percentage share in the gross revenues of
Piatco, the amount will be remitted to government in pesos
instead of US dollars.55 This amendment enables Piatco to
benefit from the further erosion of the peso-dollar exchange
rate, while preventing government from building up its foreign
exchange reserves.
7. All payments from Piatco to government are now to be
invoiced to MIAA, and payments are to accrue to the latter's
exclusive benefit.56 This move appears to be in support of the
funds MIAA advanced to DPWH.
I must emphasize that the First Supplement is void in two respects.
First, it is merely an amendment to the ARCA, upon which it is wholly
dependent; therefore, since the ARCA is void, inexistent and not
capable of being ratified or amended, it follows that the FS too is void,
inexistent and inoperative. Second, even assuming arguendo that the
ARCA is somehow remotely valid, nonetheless the FS, in imposing
significant new obligations upon government, altered the fundamental
terms and stipulations of the ARCA, thus necessitating a public bidding
all over again. That the FS was entered into sans public bidding
renders it utterly void and inoperative.
The Second Supplement Is Similarly Void and Inexistent
The Second Supplement ("SS") was executed between the government
and Piatco on September 4, 2000. It calls for Piatco, acting not as
concessionaire of NAIA Terminal III but as a public works contractor, to
undertake - in the government's stead - the clearing, removal,
demolition and disposal of improvements, subterranean obstructions
and waste materials at the project site.57
The scope of the works, the procedures involved, and the obligations of
the contractor are provided for in Parts II and III of the SS. Section 4.1
sets out the compensation to be paid, listing specific rates per cubic
meter of materials for each phase of the work - excavation, leveling,
removal and disposal, backfilling and dewatering. The amounts
collectible by Piatco are to be offset against the Annual Guaranteed
Payments it must pay government.
Though denominated as Second Supplement, it was nothing less than
an entirely new public works contract. Yet it, too, did not undergo any
public bidding, for which reason it is also void and inoperative.
Not surprisingly, Piatco had to subcontract the works to a certain
Wintrack Builders, a firm reputedly owned by a former high-ranking
DOTC official. But that is another story altogether.
The Third Supplement Is Likewise Void and Inexistent
The Third Supplement ("TS"), executed between the government and
Piatco on June 22, 2001, passed on to the government certain
obligations of Piatco as Terminal III concessionaire, with respect to the
surface road connecting Terminals II and III.
By way of background, at the inception of and forming part of the NAIA
Terminal III project was the proposed construction of an access tunnel
crossing Runway 13/31, which. would connect Terminal III to Terminal
II. The Bid Documents in Section 4.1.2.3[B][i] declared that the said
access tunnel was subject to further negotiation; but for purposes of the
bidding, the proponent should submit a bid for it as well. Therefore, the
tunnel was supposed to be part and parcel of the Terminal III project.
However, in Section 5 of the First Supplement, the parties declared that
the access tunnel was not economically viable at that time. In lieu
thereof, the parties agreed that a surface access road (now called the
T2-T3 Road) was to be constructed by Piatco to connect the two
terminals. Since it was plainly in substitution of the tunnel, the surface
road construction should likewise be considered part and parcel of the
same project, and therefore part of Piatco's obligation as well. While the
access tunnel was estimated to cost about P800 million, the surface
road would have a price tag in the vicinity of about P100 million, thus
producing significant savings for Piatco.
Yet, the Third Supplement, while confirming that Piatco would construct
the T2-T3 Road, nevertheless shifted to government some of the
obligations pertaining to the former, as follows:
 1. Government is now obliged to remove at its own expense
all tenants, squatters, improvements and/or waste materials
on the site where the T2-T3 road is to be constructed. 58 There
was no similar obligation on the part of government insofar as
the access tunnel was concerned.
2. Should government fail to carry out its obligation as above
described, Piatco may undertake it on government's behalf,
subject to the terms and conditions (including compensation
payments) contained in the Second Supplement.59
3. MIAA will answer for the operation, maintenance and repair
of the T2-T3 Road.60
The TS depends upon and is intended to supplement the ARCA as well
as the First Supplement, both of which are void and inexistent and not
capable of being ratified or amended. It follows that the TS is likewise
void, inexistent and inoperative. And even if, hypothetically speaking,
both ARCA and FS are valid, still, the Third Supplement - imposing as it
does significant new obligations upon government - would in effect alter
the terms and stipulations of the ARCA in material respects, thus
necessitating another public bidding. Since the TS was not subjected to
public bidding, it is consequently utterly void as well. At any rate, the TS
created new monetary obligations on the part of government, for which
there were no prior appropriations. Hence it follows that the same is
void ab initio.
In patiently tracing the progress of the Piatco contracts from their
inception up to the present, I noted that the whole process was riddled
with significant lapses, if not outright irregularity and wholesale
violations of law and public policy. The rationale of beginning at the
beginning, so to speak, will become evident when the question of what
to do with the five Piatco contracts is discussed later on.
In the meantime, I shall take up specific, provisions or changes in the
contracts and highlight the more prominent objectionable features.
Government Directly Guarantees Piatco Debts
Certainly the most discussed provision in the parties' arguments is the
one creating an unauthorized, direct government guarantee of Piatco's
obligations in favor of the lenders.
Section 4-A of the BOT Law as amended states that unsolicited
proposals, such as the NAIA Terminal III Project, may be accepted by
government provided inter alia that no direct government guarantee,
subsidy or equity is required. In short, such guarantee is prohibited in
unsolicited proposals. Section 2(n) of the same legislation defines
direct government guarantee as "an agreement whereby the
government or any of its agencies or local government units (will)
assume responsibility for the repayment of debt directly incurred by the
project proponent in implementing the project in case of a loan default."
Both the CA and the ARCA have provisions that undeniably create
such prohibited government guarantee. Section 4.04 (c)(iv) to (vi) of the
ARCA, which is similar to Section 4.04 of the CA, provides thus:
"(iv) that if Concessionaire is in default under a payment
obligation owed to the Senior Lenders, and as a result thereof
the Senior Lenders have become entitled to accelerate the
Senior Loans, the Senior Lenders shall have the right to notify
GRP of the same . . .;
(v) . . . the Senior Lenders may after written notification to
GRP, transfer the Concessionaire's rights and obligations to a
transferee . . .;
(vi) if the Senior Lenders . . . are unable to . . . effect a
transfer . . ., then GRP and the Senior Lenders shall endeavor
. . . to enter into any other arrangement relating to the
Development Facility . . . If no agreement relating to the
Development Facility is arrived at by GRP and the Senior
Lenders within the said 180-day period, then at the end
thereof the Development Facility shall be transferred by the
Concessionaire to GRP or its designee and GRP shall make a
termination payment to Concessionaire equal to the
Appraised Value (as hereinafter defined) of the Development
Facility or the sum of the Attendant Liabilities, if greater. . . ."
In turn, the term Attendant Liabilities is defined in Section 1.06 of the
ARCA as follows:
"Attendant Liabilities refer to all amounts in each case
supported by verifiable evidence from time to time owed or
which may become, owing by Concessionaire to Senior
Lenders or any other persons or entities who have provided,
loaned or advanced funds or provided financial facilities to
Concessionaire for the Project, including, without limitation, all
principal, interest, associated fees, charges, reimbursements,
and other related expenses (including the fees, charges and
expenses of any agents or trustees of such persons or
entities), whether payable at maturity, by acceleration or
otherwise, and further including amounts owed by
Concessionaire to its professional consultants and advisers,
suppliers, contractors and sub-contractors."
Government's agreement to pay becomes effective in the event of a
default by Piatco on any of its loan obligations to the Senior Lenders,
and the amount to be paid by government is the greater of either the
Appraised Value of Terminal III or the aggregate amount of the
moneys owed by Piatco - whether to the Senior Lenders or to other
entities, including its suppliers, contractors and subcontractors. In
effect, therefore, this agreement already constitutes the prohibited
assumption by government of responsibility for repayment of Piatco's
debts in case of a loan default. In fine, a direct government guarantee.
It matters not that there is a roundabout procedure prescribed by
Section 4.04(c)(iv), (v) and (vi) that would require, first, an attempt
(albeit unsuccessful) by the Senior Lenders to transfer Piatco's rights to
a transferee of their choice; and, second, an effort (equally
unsuccessful) to "enter into any other arrangement" with the
government regarding the Terminal III facility, before government is
required to make good on its guarantee. What is abundantly clear is the
fact that, in the devious labyrinthine process detailed in the aforesaid
section, it is entirely within the Senior Lenders' power, prerogative and
control - exercisable via a mere refusal or inability to agree upon "a
transferee" or "any other arrangement" regarding the terminal facility -
to push the process forward to the ultimate contractual cul-de-sac,
wherein government will be compelled to abjectly surrender and make
good on its guarantee of payment.
Piatco also argues that there is no proviso requiring government to pay
the Senior Lenders in the event of Piatco's default. This is literally true,
in the sense that Section 4.04(c)(vi) of ARCA speaks of government
making the termination payment to Piatco, not to the lenders. However,
it is almost a certainty that the Senior Lenders will already have made
Piatco sign over to them, ahead of time, its right to receive such
payments from government; and/or they may already have had
themselves appointed its attorneys-in-fact for the purpose of collecting
and receiving such payments.
Nevertheless, as petitioners-in-intervention pointed out in their
Memorandum,61 the termination payment is to be made to Piatco, not to
the lenders; and there is no provision anywhere in the contract
documents to prevent it from diverting the proceeds to its own benefit
and/or to ensure that it will necessarily use the same to pay off the
Senior Lenders and other creditors, in order to avert the foreclosure of
the mortgage and other liens on the terminal facility. Such deficiency
puts the interests of government at great risk. Indeed, if the unthinkable
were to happen, government would be paying several hundreds of
millions of dollars, but the mortgage liens on the facility may still be
foreclosed by the Senior Lenders just the same.
Consequently, the Piatco contracts are also objectionable for grievously
failing to adequately protect government's interests. More accurately,
the contracts would consistently weaken and do away with protection of
government interests. As such, they are therefore grossly lopsided in
favor of Piatco and/or its Senior Lenders.
While on this subject, it is well to recall the earlier discussion regarding
a particularly noticeable alteration of the concept of "Attendant
Liabilities." In Section 1.06 of the CA defining the term, the Piatco debts
to be assumed/paid by government were qualified by the phrases
recorded and from time to time outstanding in the books of the
Concessionaire and actually used for the project. These phrases were
eliminated from the ARCA's definition of Attendant Liabilities.
Since no explanation has been forthcoming from Piatco as to the
possible justification for such a drastic change, the only conclusion,
possible is that it intends to have all of its debts covered by the
guarantee, regardless of whether or not they are disclosed in its books.
This has particular reference to those borrowings which were obtained
in violation of the loan covenants requiring Piatco to maintain a
minimum 70:30 debt-to-equity ratio, and even if the loan proceeds were
not actually used for the project itself.
This point brings us back to the guarantee itself. In Section 4.04(c)(vi)
of ARCA, the amount which government has guaranteed to pay as
termination payment is the greater of either (i) the Appraised Value of
the terminal facility or (ii) the aggregate of the Attendant Liabilities.
Given that the Attendant Liabilities may include practically any Piatco
debt under the sun, it is highly conceivable that their sum may greatly
exceed the appraised value of the facility, and government may end up
paying very much more than the real worth of Terminal III. (So why did
government have to bother with public bidding anyway?)
In the final analysis, Section 4.04(c)(iv) to (vi) of the ARCA is
diametrically at odds with the spirit and the intent of the BOT Law. The
law meant to mobilize private resources (the private sector) to take on
the burden and the risks of financing the construction, operation and
maintenance of relevant infrastructure and development projects for the
simple reason that government is not in a position to do so. By the
same token, government guarantee was prohibited, since it would
merely defeat the purpose and raison d'être of a build-operate-and-
transfer project to be undertaken by the private sector.
To the extent that the project proponent is able to obtain loans to fund
the project, those risks are shared between the project proponent on
the one hand, and its banks and other lenders on the other. But where
the proponent or its lenders manage to cajol or coerce the government
into extending a guarantee of payment of the loan obligations, the risks
assumed by the lenders are passed right back to government. I cannot
understand why, in the instant case, government cheerfully assented to
re-assuming the risks of the project when it gave the prohibited
guarantee and thus simply negated the very purpose of the BOT Law
and the protection it gives the government.
Contract Termination Provisions in the Piatco Contracts Are Void
The BOT Law as amended provides for contract termination as follows:
"Sec. 7. Contract Termination. - In the event that a project is
revoked, cancelled or terminated by the government through
no fault of the project proponent or by mutual agreement, the
Government shall compensate the said project proponent for
its actual expenses incurred in the project plus a reasonable
rate of return thereon not exceeding that stated in the contract
as of the date of such revocation, cancellation or termination:
Provided, That the interest of the Government in this
instances [sic] shall be duly insured with the Government
Service Insurance System or any other insurance entity duly
accredited by the Office of the Insurance Commissioner:
Provided, finally, That the cost of the insurance coverage shall
be included in the terms and conditions of the bidding referred
to above.
"In the event that the government defaults on certain major
obligations in the contract and such failure is not remediable
or if remediable shall remain unremedied for an unreasonable
length of time, the project proponent/contractor may, by prior
notice to the concerned national government agency or local
government unit specifying the turn-over date, terminate the
contract. The project proponent/contractor shall be reasonably
compensated by the Government for equivalent or
proportionate contract cost as defined in the contract."
The foregoing statutory provision in effect provides for the following
limited instances when termination compensation may be allowed:
1. Termination by the government through no fault of the
project proponent
2. Termination upon the parties' mutual agreement
3. Termination by the proponent due to government's default
on certain major contractual obligations
To emphasize, the law does not permit compensation for the project
proponent when contract termination is due to the proponent's own
fault or breach of contract.
This principle was clearly violated in the Piatco Contracts. The ARCA
stipulates that government is to pay termination compensation to Piatco
even when termination is initiated by government for the following
causes:
"(i) Failure of Concessionaire to finish the Works in all material
respects in accordance with the Tender Design and the
Timetable;
(ii) Commission by Concessionaire of a material breach of this
Agreement . . .;
(iii) . . . a change in control of Concessionaire arising from the
sale, assignment, transfer or other disposition of capital stock
which results in an ownership structure violative of statutory or
constitutional limitations;
(iv) A pattern of continuing or repeated non-compliance, willful
violation, or non-performance of other terms and conditions
hereof which is hereby deemed a material breach of this
Agreement . . ."62
As if that were not bad enough, the ARCA also inserted into Section
8.01 the phrase "Subject to Section 4.04." The effect of this insertion is
that in those instances where government may terminate the contract
on account of Piatco's breach, and it is nevertheless required under the
ARCA to make termination compensation to Piatco even though
unauthorized by law, such compensation is to be equivalent to the
payment amount guaranteed by government - either a) the Appraised
Value of the terminal facility or (b) the aggregate of the Attendant
Liabilities, whichever amount is greater!
Clearly, this condition is not in line with Section 7 of the BOT Law. That
provision permits a project proponent to recover the actual expenses it
incurred in the prosecution of the project plus a reasonable rate of
return not in excess of that provided in the contract; or to be
compensated for the equivalent or proportionate contract cost as
defined in the contract, in case the government is in default on certain
major contractual obligations.
Furthermore, in those instances where such termination compensation
is authorized by the BOT Law, it is indispensable that the interest of
government be duly insured. Section 5.08 the ARCA mandates
insurance coverage for the terminal facility; but all insurance policies
are to be assigned, and all proceeds are payable, to the Senior
Lenders. In brief, the interest being secured by such coverage is that of
the Senior Lenders, not that of government. This can hardly be
considered compliance with law.
In essence, the ARCA provisions on termination compensation result in
another unauthorized government guarantee, this time in favor of
Piatco.
A Prohibited Direct Government Subsidy, Which at the Same Time
Is an Assault on the National Honor
Still another contractual provision offensive to law and public policy is
Section 8.01(d) of the ARCA, which is a "bolder and badder" version of
Section 8.04(d) of the CA.
It will be recalled that Section 4-A of the BOT Law as amended
prohibits not only direct government guarantees, but likewise a direct
government subsidy for unsolicited proposals. Section 13.2. b. iii. of the
1999 IRR defines a direct government subsidy as encompassing "an
agreement whereby the Government . . . will . . . postpone any
payments due from the proponent."
Despite the statutory ban, Section 8.01 (d) of the ARCA provides thus:
"(d) The provisions of Section 8.01(a) notwithstanding, and for
the purpose of preventing a disruption of the operations in the
Terminal and/or Terminal Complex, in the event that at any
time Concessionaire is of the reasonable opinion that it shall
be unable to meet a payment obligation owed to the Senior
Lenders, Concessionaire shall give prompt notice to GRP,
through DOTC/MIAA and to the Senior Lenders. In such
circumstances, the Senior Lenders (or the Senior Lenders'
Representative) may ensure that after making provision for
administrative expenses and depreciation, the cash resources
of Concessionaire shall first be used and applied to meet all
payment obligations owed to the Senior Lenders. Any excess
cash, after meeting such payment obligations, shall be
earmarked for the payment of all sums payable by
Concessionaire to GRP under this Agreement. If by reason of
the foregoing GRP should be unable to collect in full all
payments due to GRP under this Agreement, then the unpaid
balance shall be payable within a 90-day grace period
counted from the relevant due date, with interest per annum
at the rate equal to the average 91-day Treasury Bill Rate as
of the auction date immediately preceding the relevant due
date. If payment is not effected by Concessionaire within the
grace period, then a spread of five (5%) percent over the
applicable 91-day Treasury Bill Rate shall be added on the
unpaid amount commencing on the expiry of the grace period
up to the day of full payment. When the temporary illiquidity of
Concessionaire shall have been corrected and the cash
position of Concessionaire should indicate its ability to meet
its maturing obligations, then the provisions set forth under
this Section 8.01(d) shall cease to apply. The foregoing
remedial measures shall be applicable only while there
remains unpaid and outstanding amounts owed to the Senior
Lenders." (Emphasis supplied)
By any manner of interpretation or application, Section 8.01(d) of the
ARCA clearly mandates the indefinite postponement of payment of all
of Piatco's obligations to the government, in order to ensure that
Piatco's obligations to the Senior Lenders are paid in full first. That is
nothing more or less than the direct government subsidy prohibited by
the BOT Law and the IRR. The fact that Piatco will pay interest on the
unpaid amounts owed to government does not change the situation or
render the prohibited subsidy any less unacceptable.
But beyond the clear violations of law, there are larger issues involved
in the ARCA. Earlier, I mentioned that Section 8.01(d) of the ARCA
completely eliminated the proviso in Section 8.04(d) of the CA which
gave government the right to appoint a financial controller to manage
the cash position of Piatco during situations of financial distress. Not
only has government been deprived of any means of monitoring and
managing the situation; worse, as can be seen from Section 8.01(d)
above-quoted, the Senior Lenders have effectively locked in on the
right to exercise financial controllership over Piatco and to allocate its
cash resources to the payment of all amounts owed to the Senior
Lenders before allowing any payment to be made to government.
In brief, this particular provision of the ARCA has placed in the hands of
foreign lenders the power and the authority to determine how much (if
at all) and when the Philippine government (as grantor of the franchise)
may be allowed to receive from Piatco. In that situation, government will
be at the mercy of the foreign lenders. This is a situation completely
contrary to the rationale of the BOT Law and to public policy.
The aforesaid provision rouses mixed emotions - shame and
disgust at the parties' (especially the government officials') docile
submission and abject servitude and surrender to the imperious
and excessive demands of the foreign lenders, on the one hand;
and vehement outrage at the affront to the sovereignty of the
Republic and to the national honor, on the other. It is indeed time
to put an end to such an unbearable, dishonorable situation.
The Piatco Contracts Unarguably Violate Constitutional
Injunctions
I will now discuss the manner in which the Piatco Contracts offended
the Constitution.
The Exclusive Right Granted to Piatco to Operate a Public Utility Is
Prohibited by the Constitution
While Section 2.02 of the ARCA spoke of granting to Piatco "a
franchise to operate and maintain the Terminal Complex," Section
3.02(a) of the same ARCA granted to Piatco, for the entire term of the
concession agreement, "the exclusive right to operate a commercial
international passenger terminal within the Island of Luzon" with the
exception of those three terminals already existing 63 at the time of
execution of the ARCA.
Section 11 of Article XII of the Constitution prohibits the grant of a
"franchise, certificate, or any other form of authorization for the
operation of a public utility" that is "exclusive in character."
In its Opinion No. 078, Series of 1995, the Department of justice held
that "the NAIA Terminal III which . . . is a 'terminal for public use' is a
public utility." Consequently, the constitutional prohibition against the
exclusivity of a franchise applies to the franchise for the operation of
NAIA Terminal III as well.
What was granted to Piatco was not merely a franchise, but an
"exclusive right" to operate an international passenger terminal within
the "Island of Luzon." What this grant effectively means is that the
government is now estopped from exercising its inherent power to
award any other person another franchise or a right to operate such a
public utility, in the event public interest in Luzon requires it. This
restriction is highly detrimental to government and to the public interest.
Former Secretary of Justice Hernando B. Perez expressed this point
well in his Memorandum for the President dated 21 May 2002:
"Section 3.02 on 'Exclusivity'
"This provision gives to PIATCO (the Concessionaire) the
exclusive right to operate a commercial international airport
within the Island of Luzon with the exception of those already
existing at the time of the execution of the Agreement, such
as the airports at Subic, Clark and Laoag City. In the case of
the Clark International Airport, however, the provision restricts
its operation beyond its design capacity of 850,000
passengers per annum and the operation of new terminal
facilities therein until after the new NAIA Terminal III shall
have consistently reached or exceeded its design capacity of
ten (10) million passenger capacity per year for three (3)
consecutive years during the concession period.
"This is an onerous and disadvantageous provision. It
effectively grants PIATCO a monopoly in Luzon and ties the
hands of government in the matter of developing new airports
which may be found expedient and necessary in carrying out
any future plan for an inter-modal transportation system in
Luzon.
"Additionally, it imposes an unreasonable restriction on the
operation of the Clark International Airport which could
adversely affect the operation and development of the Clark
Special Economic Zone to the economic prejudice of the local
constituencies that are being benefited by its operation."
(Emphasis supplied)
While it cannot be gainsaid that an enterprise that is a public utility may
happen to constitute a monopoly on account of the very nature of its
business and the absence of competition, such a situation does not
however constitute justification to violate the constitutional prohibition
and grant an exclusive franchise or exclusive right to operate a public
utility.
Piatco's contention that the Constitution does not actually prohibit
monopolies is beside the point. As correctly argued, 64 the existence of a
monopoly by a public utility is a situation created by circumstances that
do not encourage competition. This situation is different from the grant
of a franchise to operate a public utility, a privilege granted by
government. Of course, the grant of a franchise may result in a
monopoly. But making such franchise exclusive is what is expressly
proscribed by the Constitution.
Actually, the aforementioned Section 3.02 of the ARCA more than just
guaranteed exclusivity; it also guaranteed that the government will not
improve or expand the facilities at Clark - and in fact is required to put a
cap on the latter's operations - until after Terminal III shall have been
operated at or beyond its peak capacity for three consecutive years.65
As counsel for public respondents pointed out, in the real world where
the rate of influx of international passengers can fluctuate substantially
from year to year, it may take many years before Terminal III sees three
consecutive years' operations at peak capacity. The Diosdado
Macapagal International Airport may thus end up stagnating for a long
time. Indeed, in order to ensure greater profits for Piatco, the economic
progress of a region has had to be sacrificed.
The Piatco Contracts Violate the Time Limitation on Franchises
Section 11 of Article XII of the Constitution also provides that "no
franchise, certificate or any other form of authorization for the operation
of a public utility shall be . . . for a longer period than fifty years." After
all, a franchise held for an unreasonably long time would likely give rise
to the same evils as a monopoly.
The Piatco Contracts have come up with an innovative way to
circumvent the prohibition and obtain an extension. This fact can be
gleaned from Section 8.03(b) of the ARCA, which I quote thus:
"Sec. 8.03. Termination Procedure and Consequences of
Termination. -
a) x x x           x x x           x x x
b) In the event the Agreement is terminated
pursuant to Section 8.01 (b) hereof, Concessionaire
shall be entitled to collect the Liquidated Damages
specified in Annex 'G'. The full payment by GRP to
Concessionaire of the Liquidated Damages shall be
a condition precedent to the transfer by
Concessionaire to GRP of the Development Facility.
Prior to the full payment of the Liquidated Damages,
Concessionaire shall to the extent practicable
continue to operate the Terminal and the Terminal
Complex and shall be entitled to retain and withhold
all payments to GRP for the purpose of offsetting the
same against the Liquidated Damages. Upon full
payment of the Liquidated Damages,
Concessionaire shall immediately transfer the
Development Facility to GRP on 'as-is-where-is'
basis."
The aforesaid easy payment scheme is less beneficial than it first
appears. Although it enables government to avoid having to make
outright payment of an obligation that will likely run into billions of
pesos, this easy payment plan will nevertheless cost government
considerable loss of income, which it would earn if it were to operate
Terminal III by itself. Inasmuch as payments to the concessionaire
(Piatco) will be on "installment basis," interest charges on the remaining
unpaid balance would undoubtedly cause the total outstanding balance
to swell. Piatco would thus be entitled to remain in the driver's seat and
keep operating the terminal for an indefinite length of time.
The Contracts Create Two Monopolies for Piatco
By way of background, two monopolies were actually created by the
Piatco contracts. The first and more obvious one refers to the business
of operating an international passenger terminal in Luzon, the business
end of which involves providing international airlines with parking space
for their aircraft, and airline passengers with the use of departure and
arrival areas, check-in counters, information systems, conveyor
systems, security equipment and paraphernalia, immigrations and
customs processing areas; and amenities such as comfort rooms,
restaurants and shops.
In furtherance of the first monopoly, the Piatco Contracts stipulate that
the NAIA Terminal III will be the only facility to be operated as an
international passenger terminal;66 that NAIA Terminals I and II will no
longer be operated as such;67 and that no one (including the
government) will be allowed to compete with Piatco in the operation of
an international passenger terminal in the NAIA Complex. 68 Given that,
at this time, the government and Piatco are the only ones engaged in
the business of operating an international passenger terminal, I am not
acutely concerned with this particular monopolistic situation.
There was however another monopoly within the NAIA created by the
subject contracts for Piatco - in the business of providing international
airlines with the following: groundhandling, in-flight catering, cargo
handling, and aircraft repair and maintenance services. These are lines
of business activity in which are engaged many service providers
(including the petitioners-in-intervention), who will be adversely affected
upon full implementation of the Piatco Contracts, particularly Sections
3.01(d)69 and (e)70 of both the ARCA and the CA.
On the one hand, Section 3.02(a) of the ARCA makes Terminal III the
only international passenger terminal at the NAIA, and therefore the
only place within the NAIA Complex where the business of providing
airport-related services to international airlines may be conducted. On
the other hand, Section 3.01(d) of the ARCA requires government,
through the MIAA, not to allow service providers with expired MIAA
contracts to renew or extend their contracts to render airport-related
services to airlines. Meanwhile, Section 3.01(e) of the ARCA requires
government, through the DOTC and MIAA, not to allow service
providers - those with subsisting concession agreements for services
and operations being conducted at Terminal I - to carry over their
concession agreements, services and operations to Terminal III, unless
they first enter into a separate agreement with Piatco.
The aforementioned provisions vest in Piatco effective and exclusive
control over which service provider may and may not operate at
Terminal III and render the airport-related services needed by
international airlines. It thereby possesses the power to exclude
competition. By necessary implication, it also has effective control over
the fees and charges that will be imposed and collected by these
service providers.
This intention is exceedingly clear in the declaration by Piatco that it is
"completely within its rights to exclude any party that it has not
contracted with from NAIA Terminal III."71
Worse, there is nothing whatsoever in the Piatco Contracts that can
serve to restrict, control or regulate the concessionaire's discretion and
power to reject any service provider and/or impose any term or
condition it may see fit in any contract it enters into with a service
provider. In brief, there is no safeguard whatsoever to ensure free and
fair competition in the service-provider sector.
In the meantime, and not surprisingly, Piatco is first in line, ready to
exploit the unique business opportunity. It announced 72 that it has
accredited three groundhandlers for Terminal III. Aside from the
Philippine Airlines, the other accredited entities are the Philippine
Airport and Ground Services Globeground, Inc. ("PAGSGlobeground")
and the Orbit Air Systems, Inc. ("Orbit"). PAGSGlobeground is a wholly-
owned subsidiary of the Philippine Airport and Ground Services, Inc. or
PAGS,73 while Orbit is a wholly-owned subsidiary of Friendship
Holdings, Inc.,74 which is in turn owned 80 percent by PAGS. 75 PAGS is
a service provider owned 60 percent by the Cheng Family; 76 it is a
stockholder of 35 percent of Piatco77 and is the latter's designated
contractor-operator for NAIA Terminal III.78
Such entry into and domination of the airport-related services sector
appear to be very much in line with the following provisions contained in
the First Addendum to the Piatco Shareholders Agreement, 79 executed
on July 6, 1999, which appear to constitute a sort of master plan to
create a monopoly and combinations in restraint of trade:
"11. The Shareholders shall ensure:
a. x x x           x x x           x x x.;
b. That (Phil. Airport and Ground Services, Inc.) PAGS and/or
its designated Affiliates shall, at all times during the
Concession Period, be exclusively authorized by (PIATCO) to
engage in the provision of ground-handling, catering and
fueling services within the Terminal Complex.
c. That PAIRCARGO and/or its designated Affiliate shall,
during the Concession Period, be the only entities authorized
to construct and operate a warehouse for all cargo handling
and related services within the Site."
Precisely, proscribed by our Constitution are the monopoly and the
restraint of trade being fostered by the Piatco Contracts through the
erection of barriers to the entry of other service providers into Terminal
III. In Tatad v. Secretary of the Department of Energy,80 the Court ruled:
". . . [S]ection 19 of Article XII of the Constitution . . .
mandates: 'The State shall regulate or prohibit monopolies
when the public interest so requires. No combinations in
restraint of trade or unfair competition shall be allowed.'
"A monopoly is a privilege or peculiar advantage vested in
one or more persons or companies, consisting in the
exclusive right or power to carry on a particular business or
trade, manufacture a particular article, or control the sale or
the whole supply of a particular commodity. It is a form of
market structure in which one or only a few firms dominate the
total sales of a product or service. On the other hand, a
combination in restraint of trade is an agreement or
understanding between two or more persons, in the form of a
contract, trust, pool, holding company, or other form of
association, for the purpose of unduly restricting competition,
monopolizing trade and commerce in a certain commodity,
controlling its production, distribution and price, or otherwise
interfering with freedom of trade without statutory authority.
Combination in restraint of trade refers to the means while
monopoly refers to the end.
"x x x           x x x           x x x
"Section 19, Article XII of our Constitution is anti-trust in
history and in spirit. It espouses competition. The desirability
of competition is the reason for the prohibition against
restraint of trade, the reason for the interdiction of unfair
competition, and the reason for regulation of unmitigated
monopolies. Competition is thus the underlying principle of
[S]ection 19, Article XII of our Constitution, . . ."81
Gokongwei Jr. v. Securities and Exchange Commission 82 elucidates the
criteria to be employed: "A 'monopoly' embraces any combination the
tendency of which is to prevent competition in the broad and general
sense, or to control prices to the detriment of the public. In short, it is
the concentration of business in the hands of a few. The material
consideration in determining its existence is not that prices are raised
and competition actually excluded, but that power exists to raise prices
or exclude competition when desired."83 (Emphasis supplied)
The Contracts Encourage Monopolistic Pricing, Too
Aside from creating a monopoly, the Piatco contracts also give the
concessionaire virtually limitless power over the charging of fees,
rentals and so forth. What little "oversight function" the government
might be able and minded to exercise is less than sufficient to protect
the public interest, as can be gleaned from the following provisions:
"Sec. 6.06. Adjustment of Non-Public Utility Fees and
Charges
"For fees, rentals and charges constituting Non-Public Utility
Revenues, Concessionaire may make any adjustments it
deems appropriate without need for the consent of GRP or
any government agency subject to Sec. 6.03(c)."
Section 6.03(c) in turn provides:
"(c) Concessionaire shall at all times be judicious in fixing fees
and charges constituting Non-Public Utility Revenues in order
to ensure that End Users are not unreasonably deprived of
services. While the vehicular parking fee, porterage fee and
greeter/wellwisher fee constitute Non-Public Utility Revenues
of Concessionaire, GRP may require Concessionaire to
explain and justify the fee it may set from time to time, if in the
reasonable opinion of GRP the said fees have become
exorbitant resulting in the unreasonable deprivation of End
Users of such services."
It will be noted that the above-quoted provision has no teeth, so the
concessionaire can defy the government without fear of any sanction.
Moreover, Section 6.06 - taken together with Section 6.03(c) of the
ARCA - falls short of the standard set by the BOT Law as amended,
which expressly requires in Section 2(b) that the project proponent is
"allowed to charge facility users appropriate tolls, fees, rentals and
charges not exceeding those proposed in its bid or as negotiated
and incorporated in the contract x x x."
The Piatco Contracts Violate Constitutional Prohibitions Against
Impairment of Contracts and Deprivation of Property Without Due
Process
Earlier, I discussed how Section 3.01(e) 84 of both the CA and the ARCA
requires government, through DOTC/MIAA, not to permit the carry-over
to Terminal III of the services and operations of certain service
providers currently operating at Terminal I with subsisting contracts.
By the In-Service Date, Terminal III shall be the only facility to be
operated as an international passenger terminal at the NAIA; 85 thus,
Terminals I and II shall no longer operate as such, 86 and no one shall
be allowed to compete with Piatco in the operation of an international
passenger terminal in the NAIA.87 The bottom line is that, as of the In-
Service Date, Terminal III will be the only terminal where the business
of providing airport-related services to international airlines and
passengers may be conducted at all.
Consequently, government through the DOTC/MIAA will be compelled
to cease honoring existing contracts with service providers after the In-
Service Date, as they cannot be allowed to operate in Terminal III.
In short, the CA and the ARCA obligate and constrain government to
break its existing contracts with these service providers.
Notably, government is not in a position to require Piatco to
accommodate the displaced service providers, and it would be
unrealistic to think that these service providers can perform their
service contracts in some other international airport outside Luzon.
Obviously, then, these displaced service providers are - to borrow a
quaint expression - up the river without a paddle. In plainer terms, they
will have lost their businesses entirely, in the blink of an eye.
What we have here is a set of contractual provisions that impair the
obligation of contracts and contravene the constitutional prohibition
against deprivation of property without due process of law.88
Moreover, since the displaced service providers, being unable to
operate, will be forced to close shop, their respective employees -
among them Messrs. Agan and Lopez et al. - have very grave cause for
concern, as they will find themselves out of employment and bereft of
their means of livelihood. This situation comprises still another violation
of the constitution prohibition against deprivation of property without
due process.
True, doing business at the NAIA may be viewed more as a privilege
than as a right. Nonetheless, where that privilege has been availed of
by the petitioners-in-intervention service providers for years on end, a
situation arises, similar to that in American Inter-fashion v. GTEB.89 We
held therein that a privilege enjoyed for seven years "evolved into some
form of property right which should not be removed x x x arbitrarily and
without due process." Said pronouncement is particularly relevant and
applicable to the situation at bar because the livelihood of the
employees of petitioners-intervenors are at stake.
The Piatco Contracts Violate Constitutional Prohibition
Against Deprivation of Liberty Without Due Process
The Piatco Contracts by locking out existing service providers from
entry into Terminal III and restricting entry of future service providers,
thereby infringed upon the freedom - guaranteed to and heretofore
enjoyed by international airlines - to contract with local service
providers of their choice, and vice versa.
Both the service providers and their client airlines will be deprived of the
right to liberty, which includes the right to enter into all contracts, 90
and/or the right to make a contract in relation to one's business. 91
By Creating New Financial Obligations for Government,
Supplements to the ARCA Violate the Constitutional
Ban on Disbursement of Public Funds Without Valid Appropriation
Clearly prohibited by the Constitution is the disbursement of public
funds out of the treasury, except in pursuance of an appropriation made
by law.92 The immediate effect of this constitutional ban is that all the
various agencies of government are constrained to limit their
expenditures to the amounts appropriated by law for each fiscal year;
and to carefully count their cash before taking on contractual
commitments. Giving flesh and form to the injunction of the
fundamental law, Sections 46 and 47 of Executive Order 292, otherwise
known as the Administrative Code of 1987, provide as follows:
"Sec. 46. Appropriation Before Entering into Contract. - (1) No
contract involving the expenditure of public funds shall be
entered into unless there is an appropriation therefor, the
unexpended balance of which, free of other obligations, is
sufficient to cover the proposed expenditure; and . .
"Sec. 47. Certificate Showing Appropriation to Meet Contract.
- Except in the case of a contract for personal service, for
supplies for current consumption or to be carried in stock not
exceeding the estimated consumption for three (3) months, or
banking transactions of government-owned or controlled
banks, no contract involving the expenditure of public funds
by any government agency shall be entered into or authorized
unless the proper accounting official of the agency concerned
shall have certified to the officer entering into the obligation
that funds have been duly appropriated for the purpose and
that the amount necessary to cover the proposed contract for
the current calendar year is available for expenditure on
account thereof, subject to verification by the auditor
concerned. The certificate signed by the proper accounting
official and the auditor who verified it, shall be attached to and
become an integral part of the proposed contract, and the
sum so certified shall not thereafter be available for
expenditure for any other purpose until the obligation of the
government agency concerned under the contract is fully
extinguished."
Referring to the aforequoted provisions, this Court has held that "(I)t is
quite evident from the tenor of the language of the law that the
existence of appropriations and the availability of funds are
indispensable pre-requisites to or conditions sine qua non for the
execution of government contracts. The obvious intent is to impose
such conditions as a priori requisites to the validity of the proposed
contract."93
Notwithstanding the constitutional ban, statutory mandates and
Jurisprudential precedents, the three Supplements to the ARCA, which
were not approved by NEDA, imposed on government the additional
burden of spending public moneys without prior appropriation.
In the First Supplement ("FS") dated August 27, 1999, the following
requirements were imposed on the government:
• To construct, maintain and keep in good repair and
operating condition all airport support services, facilities,
equipment and infrastructure owned and/or operated by
MIAA, which are not part of the Project or which are located
outside the Site, even though constructed by Concessionaire -
including the access road connecting Terminals II and III and
the taxilane, taxiways and runways
• To obligate the MIAA to provide funding for the upkeep,
maintenance and repair of the airports and facilities owned or
operated by it and by third persons under its control in order
to ensure compliance with international standards; and
holding MIAA liable to Piatco for the latter's losses, expenses
and damages as well as for the latter's liability to third
persons, in case MIAA fails to perform such obligations; in
addition, MIAA will also be liable for the incremental and
consequential costs of the remedial work done by Piatco on
account of the former's default.
• Section 4 of the FS imposed on government ten (10)
"Additional Special Obligations," including the following:
o Providing thru MIAA the land required by Piatco for
the taxilane and one taxiway, at no cost to Piatco
o Implementing the government's existing storm
drainage master plan
o Coordinating with DPWH the financing,
implementation and completion of the following
works before the In-Service Date: three left-turning
overpasses (Edsa to Tramo St., Tramo to Andrews
Ave., and Manlunas Road to Sales Ave.) and a road
upgrade and improvement program involving
widening, repair and resurfacing of Sales Road,
Andrews Avenue and Manlunas Road; improvement
of Nichols Interchange; and removal of squatters
along Andrews Avenue
o Dealing directly with BCDA and the Philippine Air
Force in acquiring additional land or right of way for
the road upgrade and improvement program
o Requiring government to work for the immediate
reversion to MIAA of the Nayong Pilipino National
Park, in order to permit the building of the second
west parallel taxiway
• Section 5 of the FS also provides that in lieu of the access
tunnel, a surface access road (T2-T3) will be constructed.
This provision requires government to expend funds to
purchase additional land from Nayong Pilipino and to clear the
same in order to be able to deliver clean possession of the
site to Piatco, as required in Section 5(c) of the FS.
On the other hand, the Third Supplement ("TS") obligates the
government to deliver, within 120 days from date thereof, clean
possession of the land on which the T2-T3 Road is to be constructed.
The foregoing contractual stipulations undeniably impose on
government the expenditures of public funds not included in any
congressional appropriation or authorized by any other statute. Piatco
however attempts to take these stipulations out of the ambit of Sections
46 and 47 of the Administrative Code by characterizing them as
stipulations for compliance on a "best-efforts basis" only.
To determine whether the additional obligations under the Supplements
may really be undertaken on a best-efforts basis only, the nature of
each of these obligations must be examined in the context of its
relevance and significance to the Terminal III Project, as well as of any
adverse impact that may result if such obligation is not performed or
undertaken on time. In short, the criteria for determining whether the
best-efforts basis will apply is whether the obligations are critical to the
success of the Project and, accordingly, whether failure to perform
them (or to perform them on time) could result in a material breach of
the contract.
Viewed in this light, the "Additional Special Obligations" set out in
Section 4 of the FS take on a different aspect. In particular, each of the
following may all be deemed to play a major role in the successful and
timely prosecution of the Terminal III Project: the obtention of land
required by PIATCO for the taxilane and taxiway; the implementation of
government's existing storm drainage master plan; and coordination
with DPWH for the completion of the three left-turning overpasses
before the In-Service Date, as well as acquisition and delivery of
additional land for the construction of the T2-T3 access road.
Conversely, failure to deliver on any of these obligations may
conceivably result in substantial prejudice to the concessionaire, to
such an extent as to constitute a material breach of the Piatco
Contracts. Whereupon, the concessionaire may outrightly terminate the
Contracts pursuant to Section 8.01(b)(i) and (ii) of the ARCA and seek
payment of Liquidated Damages in accordance with Section 8.02(a) of
the ARCA; or the concessionaire may instead require government to
pay the Incremental and Consequential Losses under Section 1.23 of
the ARCA.94 The logical conclusion then is that the obligations in the
Supplements are not to be performed on a best-efforts basis only, but
are unarguably mandatory in character.
Regarding MIAA's obligation to coordinate with the DPWH for the
complete implementation of the road upgrading and improvement
program for Sales, Andrews and Manlunas Roads (which provide
access to the Terminal III site) prior to the In-Service Date, it is
essential to take note of the fact that there was a pressing need to
complete the program before the opening of Terminal III. 95 For that
reason, the MIAA was compelled to enter into a memorandum of
agreement with the DPWH in order to ensure the timely completion of
the road widening and improvement program. MIAA agreed to advance
the total amount of P410.11 million to DPWH for the works, while the
latter was committed to do the following:
"2.2.8. Reimburse all advance payments to MIAA including
but not limited to interest, fees, plus other costs of money
within the periods CY2004 and CY2006 with payment of no
less than One Hundred Million Pesos (PhP100M) every year.
"2.2.9. Perform all acts necessary to include in its CY2004 to
CY2006 budget allocation the repayments for the advances
made by MIAA, to ensure that the advances are fully repaid
by CY2006. For this purpose, DPWH shall include the
amounts to be appropriated for reimbursement to MIAA in the
"Not Needing Clearance" column of their Agency Budget
Matrix (ABM) submitted to the Department of Budget and
Management."
It can be easily inferred, then, that DPWH did not set aside enough
funds to be able to complete the upgrading program for the crucially
situated access roads prior to the targeted opening date of Terminal III;
and that, had MIAA not agreed to lend the P410 Million, DPWH would
not have been able to complete the program on time. As a
consequence, government would have been in breach of a material
obligation. Hence, this particular undertaking of government may
likewise not be construed as being for best-efforts compliance only.
They also Infringe on the Legislative Prerogative and Power Over
the Public Purse
But the particularly sad thing about this transaction between MIAA and
DPWH is the fact that both agencies were maneuvered into (or allowed
themselves to be maneuvered into) an agreement that would ensure
delivery of upgraded roads for Piatco's benefit, using funds not
allocated for that purpose. The agreement would then be presented to
Congress as a done deal. Congress would thus be obliged to uphold
the agreement and support it with the necessary allocations and
appropriations for three years, in order to enable DPWH to deliver on its
committed repayments to MIAA. The net result is an infringement on
the legislative power over the public purse and a diminution of
Congress' control over expenditures of public funds - a development
that would not have come about, were it not for the Supplements. Very
clever but very illegal!
EPILOGUE
What Do We Do Now?
In the final analysis, there remains but one ultimate question, which I
raised during the Oral Argument on December 10, 2002: What do we
do with the Piatco Contracts and Terminal III?96 (Feeding directly
into the resolution of the decisive question is the other nagging issue:
Why should we bother with determining the legality and validity of these
contracts, when the Terminal itself has already been built and is
practically complete?)
Prescinding from all the foregoing disquisition, I find that all the Piatco
contracts, without exception, are void ab initio, and therefore
inoperative. Even the very process by which the contracts came into
being - the bidding and the award - has been riddled with irregularities
galore and blatant violations of law and public policy, far too many to
ignore. There is thus no conceivable way, as proposed by some, of
saving one (the original Concession Agreement) while junking all the
rest.
Neither is it possible to argue for the retention of the Draft Concession
Agreement (referred to in the various pleadings as the Contract Bidded
Out) as the contract that should be kept in force and effect to govern
the situation, inasmuch as it was never executed by the parties. What
Piatco and the government executed was the Concession Agreement
which is entirely different from the Draft Concession Agreement.
Ultimately, though, it would be tantamount to an outrageous, grievous
and unforgivable mutilation of public policy and an insult to ourselves if
we opt to keep in place a contract - any contract - for to do so would
assume that we agree to having Piatco continue as the concessionaire
for Terminal III.
Despite all the insidious contraventions of the Constitution, law and
public policy Piatco perpetrated, keeping Piatco on as concessionaire
and even rewarding it by allowing it to operate and profit from Terminal
III - instead of imposing upon it the stiffest sanctions permissible under
the laws - is unconscionable.
It is no exaggeration to say that Piatco may not really mind which
contract we decide to keep in place. For all it may care, we can do just
as well without one, if we only let it continue and operate the facility.
After all, the real money will come not from building the Terminal, but
from actually operating it for fifty or more years and charging whatever
it feels like, without any competition at all. This scenario must not be
allowed to happen.
If the Piatco contracts are junked altogether as I think they should be,
should not AEDC automatically be considered the winning bidder and
therefore allowed to operate the facility? My answer is a stone-cold
'No'. AEDC never won the bidding, never signed any contract, and
never built any facility. Why should it be allowed to automatically step in
and benefit from the greed of another?
Should government pay at all for reasonable expenses incurred in the
construction of the Terminal? Indeed it should, otherwise it will be
unjustly enriching itself at the expense of Piatco and, in particular, its
funders, contractors and investors - both local and foreign. After all,
there is no question that the State needs and will make use of Terminal
III, it being part and parcel of the critical infrastructure and
transportation-related programs of government.
In Melchor v. Commission on Audit,97 this Court held that even if the
contract therein was void, the principle of payment by quantum meruit
was found applicable, and the contractor was allowed to recover the
reasonable value of the thing or services rendered (regardless of any
agreement as to the supposed value), in order to avoid unjust
enrichment on the part of government. The principle of quantum meruit
was likewise applied in Eslao v. Commission on Audit,98 because to
deny payment for a building almost completed and already occupied
would be to permit government to unjustly enrich itself at the expense
of the contractor. The same principle was applied in Republic v. Court
of Appeals.99
One possible practical solution would be for government - in view of the
nullity of the Piatco contracts and of the fact that Terminal III has
already been built and is almost finished - to bid out the operation of the
facility under the same or analogous principles as build-operate-and-
transfer projects. To be imposed, however, is the condition that the
winning bidder must pay the builder of the facility a price fixed by
government based on quantum meruit; on the real, reasonable - not
inflated - value of the built facility.
How the payment or series of payments to the builder, funders,
investors and contractors will be staggered and scheduled, will have to
be built into the bids, along with the annual guaranteed payments to
government. In this manner, this whole sordid mess could result in
something truly beneficial for all, especially for the Filipino people.
WHEREFORE, I vote to grant the Petitions and to declare the subject
contracts NULL and VOID.
G.R. No. 155336             November 25, 2004 whenever public interest so requires, make adjustments in the
COMMISSION ON HUMAN RIGHTS EMPLOYEES' ASSOCIATION personnel services itemization including, but not limited to, the
(CHREA) Represented by its President, MARCIAL A. SANCHEZ, transfer of item or creation of new positions in their respective
JR., petitioner, offices: PROVIDED, That officers and employees whose
vs. positions are affected by such reorganization or adjustments
COMMISSION ON HUMAN RIGHTS, respondent. shall be granted retirement gratuities and separation pay in
accordance with existing laws, which shall be payable from
any unexpanded balance of, or savings in the appropriations
DECISION of their respective offices;
Whereas, the Commission on Human Rights is a member of
CHICO-NAZARIO, J.: the Constitutional Fiscal Autonomy Group (CFAG) and on
Can the Commission on Human Rights lawfully implement an July 24, 1998, CFAG passed an approved Joint Resolution
upgrading and reclassification of personnel positions without the prior No. 49 adopting internal rules implementing the special
approval of the Department of Budget and Management? provisions heretoforth mentioned;
Before this Court is a petition for review filed by petitioner Commission NOW THEREFORE, the Commission by virtue of its fiscal
on Human Rights Employees' Association (CHREA) challenging the autonomy hereby approves and authorizes the upgrading and
Decision1 dated 29 November 2001 of the Court of Appeals in CA-G.R. augmentation of the commensurate amount generated from
SP No. 59678 affirming the Resolutions2 dated 16 December 1999 and savings under Personal Services to support the
09 June 2000 of the Civil Service Commission (CSC), which sustained implementation of this resolution effective Calendar Year
the validity of the upgrading and reclassification of certain personnel 1998;
positions in the Commission on Human Rights (CHR) despite the Let the Human Resources Development Division (HRDD)
disapproval thereof by the Department of Budget and Management prepare the necessary Notice of Salary Adjustment and other
(DBM). Also assailed is the resolution dated 11 September 2002 of the appropriate documents to implement this resolution; . . . .3
Court of Appeals denying the motion for
reconsideration filed by petitioner. Number of Position Salary Grade Total Salary
The antecedent facts which spawned the present Positions Title Requirements
controversy are as follows:
  From To From To  
On 14 February 1998, Congress passed Republic
Act No. 8522, otherwise known as the General 12 Attorney VI (In Director IV 26 28 P229,104.00
Appropriations Act of 1998. It provided for Special the Regional
Provisions Applicable to All Constitutional Offices Field Offices)
Enjoying Fiscal Autonomy. The last portion of
4 Director III Director IV 27 28 38,928.00
Article XXXIII covers the appropriations of the CHR.
These special provisions state: 1 Financial & Director IV 24 28 36,744.00
1. Organizational Structure. Any provision of law to Management
the contrary notwithstanding and within the limits of Officer II
their respective appropriations as authorized in this 1 Budget Officer III Budget Officer IV 18 24 51,756.00
Act, the Constitutional Commissions and Offices
enjoying fiscal autonomy are authorized to 1 Accountant III Chief Accountant 18 24 51,756.00
formulate and implement the organizational
1 Cashier III Cashier V 18 24 51,756.00
structures of their respective offices, to fix and
determine the salaries, allowances, and other 1 Information Director IV 24 28 36,744.006
benefits of their personnel, and whenever public Officer V
interest so requires, make adjustments in their
personal services itemization including, but not limited to, the transfer of (Emphasis supplied)
item or creation of new positions in their respective offices: PROVIDED, Annexed to said resolution is the proposed creation of ten additional
That officers and employees whose positions are affected by such plantilla positions, namely: one Director IV position, with Salary Grade
reorganization or adjustments shall be granted retirement gratuities and 28 for the Caraga Regional Office, four Security Officer II with Salary
separation pay in accordance with existing laws, which shall be payable Grade 15, and five Process Servers, with Salary Grade 5 under the
from any unexpended balance of, or savings in the appropriations of Office of the Commissioners. 4
their respective offices: PROVIDED, FURTHER, That the On 19 October 1998, CHR issued Resolution No. A98-0555 providing
implementation hereof shall be in accordance with salary rates, for the upgrading or raising of salary grades of the following positions in
allowances and other benefits authorized under
compensation standardization laws. Number of Position Title Salary Grade Total Salary
2. Use of Savings. The Constitutional Commissions Positions Requirements
and Offices enjoying fiscal autonomy are hereby 4 Security Officer II 15 684,780.00
authorized to use savings in their respective (Coterminous)
appropriations for: (a) printing and/or publication of
decisions, resolutions, and training information
materials; (b) repair, maintenance and Number of Position Title Salary Grade Total Salary
improvement of central and regional offices, Positions Requirements
facilities and equipment; (c) purchase of books,   From To From To  
journals, periodicals and equipment; (d) necessary
expenses for the employment of temporary, 1 Attorney V Director IV 25 28 P28,092.00
contractual and casual employees; (e) payment of 2 Security Officer I Security Officer 11 15 57,456.00
extraordinary and miscellaneous expenses, II
commutable representation and transportation
allowances, and fringe benefits for their officials           ----------------
and employees as may be authorized by law; and Total 3         P 85,548.007
(f) other official purposes, subject to accounting and
auditing rules and regulations. (Emphases the Commission:
supplied) It, likewise, provided for the creation and upgrading of the following
on the strength of these special provisions, the CHR, through its then positions:
Chairperson Aurora P. Navarette-Reciña and Commissioners Nasser A. Creation
A. Marohomsalic, Mercedes V. Contreras, Vicente P. Sibulo, and Jorge
R. Coquia, promulgated Resolution No. A98-047 on 04 September B. Upgrading
1998, adopting an upgrading and reclassification scheme among To support the implementation of such scheme, the CHR, in the same
selected positions in the Commission, to wit: resolution, authorized the augmentation of a commensurate amount
WHEREAS, the General Appropriations Act, FY 1998, R.A. generated from savings under Personnel Services.
No. 8522 has provided special provisions applicable to all By virtue of Resolution No. A98-062 dated 17 November 1998, the
Constitutional Offices enjoying Fiscal Autonomy, particularly CHR "collapsed" the vacant positions in the body to provide additional
on organizational structures and authorizes the same to source of funding for said staffing modification. Among the positions
formulate and implement the organizational structures of their collapsed were: one Attorney III, four Attorney IV, one Chemist III, three
respective offices to fix and determine the salaries, Special Investigator I, one Clerk III, and one Accounting Clerk II.8
allowances and other benefits of their personnel and
The CHR forwarded said staffing modification and upgrading scheme to
the DBM with a request for its approval, but the then DBM secretary
Benjamin Diokno denied the request on the following justification:
… Based on the evaluations made the request was not favorably
considered as it effectively involved the elevation of the field units from
divisions to services.
The present proposal seeks further to upgrade the twelve (12) positions
of Attorney VI, SG-26 to Director IV, SG-28. This would elevate the field
units to a bureau or regional office, a level even higher than the one
previously denied.
The request to upgrade the three (3) positions of Director III, SG-27 to
Director IV, SG-28, in the Central Office in effect would elevate the
services to Office and change the context from support to substantive
without actual change in functions.
In the absence of a specific provision of law which may be used as a
legal basis to elevate the level of divisions to a bureau or regional
office, and the services to offices, we reiterate our previous stand
denying the upgrading of the twelve (12) positions of Attorney VI, SG-
26 to Director III, SG-27 or Director IV, SG-28, in the Field Operations
Office (FOO) and three (3) Director III, SG-27 to Director IV, SG-28 in
the Central Office.
As represented, President Ramos then issued a Memorandum to the
DBM Secretary dated 10 December 1997, directing the latter to
increase the number of Plantilla positions in the CHR both Central and
Regional Offices to implement the Philippine Decade Plan on Human
Rights Education, the Philippine Human Rights Plan and Barangay
Rights Actions Center in accordance with existing laws. (Emphasis in
the original)
Pursuant to Section 78 of the General Provisions of the General
Appropriations Act (GAA) FY 1998, no organizational unit or changes in
key positions shall be authorized unless provided by law or directed by
the President, thus, the creation of a Finance Management Office and a
Public Affairs Office cannot be given favorable recommendation.
Moreover, as provided under Section 2 of RA No. 6758, otherwise
known as the Compensation Standardization Law, the Department of
Budget and Management is directed to establish and administer a
unified compensation and position classification system in the
government. The Supreme Court ruled in the case of Victorina Cruz vs.
Court of Appeals, G.R. No. 119155, dated January 30, 1996, that this
Department has the sole power and discretion to administer the
compensation and position classification system of the National
Government.
Being a member of the fiscal autonomy group does not vest the agency
with the authority to reclassify, upgrade, and create positions without
approval of the DBM. While the members of the Group are authorized
to formulate and implement the organizational structures of their
respective offices and determine the compensation of their personnel,
such authority is not absolute and must be exercised within the
parameters of the Unified Position Classification and Compensation
System established under RA 6758 more popularly known as the
Compensation Standardization Law. We therefore reiterate our
previous stand on the matter.9 (Emphases supplied)
In light of the DBM's disapproval of the proposed personnel
modification scheme, the CSC-National Capital Region Office, through
a memorandum dated 29 March 1999, recommended to the CSC-
Central Office that the subject appointments be rejected owing to the
DBM's disapproval of the plantilla reclassification.
Meanwhile, the officers of petitioner CHREA, in representation of the
rank and file employees of the CHR, requested the CSC-Central Office
to affirm the recommendation of the CSC-Regional Office. CHREA
stood its ground in saying that the DBM is the only agency with
appropriate authority mandated by law to evaluate and approve matters
of reclassification and upgrading, as well as creation of positions.
The CSC-Central Office denied CHREA's request in a Resolution dated
16 December 1999, and reversed the recommendation of the CSC-
Regional Office that the upgrading scheme be censured. The decretal
portion of which reads:
WHEREFORE, the request of Ronnie N. Rosero, Hubert V.
Ruiz, Flordeliza A. Briones, George Q. Dumlao [and],
Corazon A. Santos-Tiu, is hereby denied.10
CHREA filed a motion for reconsideration, but the CSC-
Central Office denied the same on 09 June 2000.
Given the cacophony of judgments between the DBM and the
CSC, petitioner CHREA elevated the matter to the Court of
Appeals. The Court of Appeals affirmed the pronouncement of
the CSC-Central Office and upheld the validity of the
upgrading, retitling, and reclassification scheme in the CHR
on the justification that such action is within the ambit of
CHR's fiscal autonomy. The fallo of the Court of Appeals
decision provides:
IN VIEW OF ALL THE FOREGOING, the instant petition is
ordered DISMISSED and the questioned Civil Service
Commission Resolution No. 99-2800 dated December 16,
1999 as well as No. 001354 dated June 9, 2000, are hereby
AFFIRMED. No cost.11
Unperturbed, petitioner filed this petition in this Court contending that:
A.
…THE COURT OF APPEALS GRAVELY ERRED WHEN IT
HELD THAT UNDER THE 1987 CONSTITUTION, THE
COMMISSION ON HUMAN RIGHTS ENJOYS FISCAL
AUTONOMY.
B.
…THE COURT OF APPEALS SERIOUSLY ERRED IN
UPHOLDING THE CONSTRUCTION OF THE COMMISSION
ON HUMAN RIGHTS OF REPUBLIC ACT NO. 8522 (THE
GENERAL APPROPRIATIONS ACT FOR THE FISCAL
YEAR 1998) DESPITE ITS BEING IN SHARP CONFLICT
WITH THE 1987 CONSTITUTION AND THE STATUTE
ITSELF.
C.
…THE COURT OF APPEALS SERIOUSLY AND GRAVELY
ERRED IN AFFIRMING THE VALIDITY OF THE CIVIL
SERVICE COMMISSION RESOLUTION NOS. 992800 AND
001354 AS WELL AS THAT OF THE OPINION OF THE
DEPARTMENT OF JUSTICE IN STATING THAT THE
COMMISSION ON HUMAN RIGHTS ENJOYS FISCAL
AUTONOMY UNDER THE 1987 CONSTITUTION AND THAT
THIS FISCAL AUTONOMY INCLUDES THE ACTION TAKEN
BY IT IN COLLAPSING, UPGRADING AND
RECLASSIFICATION OF POSITIONS THEREIN.12
The central question we must answer in order to resolve this case is:
Can the Commission on Human Rights validly implement an upgrading,
reclassification, creation, and collapsing of plantilla positions in the
Commission without the prior approval of the Department of Budget
and Management?
Petitioner CHREA grouses that the Court of Appeals and the CSC-
Central Office both erred in sanctioning the CHR's alleged blanket
authority to upgrade, reclassify, and create positions inasmuch as the
approval of the DBM relative to such scheme is still indispensable.
Petitioner bewails that the CSC and the Court of Appeals erroneously
assumed that CHR enjoys fiscal autonomy insofar as financial matters
are concerned, particularly with regard to the upgrading and
reclassification of positions therein.
Respondent CHR sharply retorts that petitioner has no locus standi
considering that there exists no official written record in the
Commission recognizing petitioner as a bona fide organization of its
employees nor is there anything in the records to show that its
president, Marcial A. Sanchez, Jr., has the authority to sue the CHR.
The CHR contends that it has the authority to cause the upgrading,
reclassification, plantilla creation, and collapsing scheme sans the
approval of the DBM because it enjoys fiscal autonomy.
After a thorough consideration of the arguments of both parties and an
assiduous scrutiny of the records in the case at bar, it is the Court's
opinion that the present petition is imbued with merit.
On petitioner's personality to bring this suit, we held in a multitude of
cases that a proper party is one who has sustained or is in immediate
danger of sustaining an injury as a result of the act complained of.13
Here, petitioner, which consists of rank and file employees of
respondent CHR, protests that the upgrading and collapsing of
positions benefited only a select few in the upper level positions in the
Commission resulting to the demoralization of the rank and file
employees. This sufficiently meets the injury test. Indeed, the CHR's
upgrading scheme, if found to be valid, potentially entails eating up the
Commission's savings or that portion of its budgetary pie otherwise
allocated for Personnel Services, from which the benefits of the
employees, including those in the rank and file, are derived.
Further, the personality of petitioner to file this case was recognized by
the CSC when it took cognizance of the CHREA's request to affirm the
recommendation of the CSC-National Capital Region Office. CHREA's
personality to bring the suit was a non-issue in the Court of Appeals
when it passed upon the merits of this case. Thus, neither should our
hands be tied by this technical concern. Indeed, it is settled
jurisprudence that an issue that was neither raised in the complaint nor
in the court below cannot be raised for the first time on appeal, as to do
so would be offensive to the basic rules of fair play, justice, and due
process.14
We now delve into the main issue of whether or not the approval by the
DBM is a condition precedent to the enactment of an upgrading,
reclassification, creation and collapsing of plantilla positions in the
CHR.
Germane to our discussion is Rep. Act No. 6758, An Act Prescribing a
Revised Compensation and Position Classification System in the
Government and For Other Purposes, or the Salary Standardization
Law, dated 01 July 1989, which provides in Sections 2 and 4 thereof
that it is the DBM that shall establish and administer a unified
Compensation and Position Classification System. Thus:
 SEC. 2. Statement of Policy. -- It is hereby declared the policy
of the State to provide equal pay for substantially equal work
and to base differences in pay upon substantive differences in
duties and responsibilities, and qualification requirements of
the positions. In determining rates of pay, due regard shall be
given to, among others, prevailing rates in the private sector
for comparable work. For this purpose, the Department of
Budget and Management (DBM) is hereby directed to
establish and administer a unified Compensation and Position
Classification System, hereinafter referred to as the System
as provided for in Presidential Decree No. 985, as amended,
that shall be applied for all government entities, as mandated
by the Constitution. (Emphasis supplied.)
SEC. 4. Coverage. – The Compensation and Position
Classification System herein provided shall apply to all
positions, appointive or elective, on full or part-time basis, now
existing or hereafter created in the government, including
government-owned or controlled corporations and
government financial institutions.
The term "government" refers to the Executive, the Legislative and the
Judicial Branches and the Constitutional Commissions and shall
include all, but shall not be limited to, departments, bureaus, offices,
boards, commissions, courts, tribunals, councils, authorities,
administrations, centers, institutes, state colleges and universities, local
government units, and the armed forces. The term "government-owned
or controlled corporations and financial institutions" shall include all
corporations and financial institutions owned or controlled by the
National Government, whether such corporations and financial
institutions perform governmental or proprietary functions. (Emphasis
supplied.)
The disputation of the Court of Appeals that the CHR is exempt from
the long arm of the Salary Standardization Law is flawed considering
that the coverage thereof, as defined above, encompasses the entire
gamut of government offices, sans qualification.
This power to "administer" is not purely ministerial in character as
erroneously held by the Court of Appeals. The word to administer
means to control or regulate in behalf of others; to direct or superintend
the execution, application or conduct of; and to manage or conduct
public affairs, as to administer the government of the state.15
The regulatory power of the DBM on matters of compensation is
encrypted not only in law, but in jurisprudence as well. In the recent
case of Philippine Retirement Authority (PRA) v. Jesusito L. Buñag,16
this Court, speaking through Mr. Justice Reynato Puno, ruled that
compensation, allowances, and other benefits received by PRA officials
and employees without the requisite approval or authority of the DBM
are unauthorized and irregular. In the words of the Court –
Despite the power granted to the Board of Directors of PRA to establish
and fix a compensation and benefits scheme for its employees, the
same is subject to the review of the Department of Budget and
Management. However, in view of the express powers granted to PRA
under its charter, the extent of the review authority of the Department of
Budget and Management is limited. As stated in Intia, the task of the
Department of Budget and Management is simply to review the
compensation and benefits plan of the government agency or entity
concerned and determine if the same complies with the prescribed
policies and guidelines issued in this regard. The role of the
Department of Budget and Management is supervisorial in nature, its
main duty being to ascertain that the proposed compensation, benefits
and other incentives to be given to PRA officials and employees adhere
to the policies and guidelines issued in accordance with applicable
laws.
In Victorina Cruz v. Court of Appeals,17 we held that the DBM has the
sole power and discretion to administer the compensation and position
classification system of the national government.
In Intia, Jr. v. Commission on Audit,18 the Court held that although the
charter19 of the Philippine Postal Corporation (PPC) grants it the power
to fix the compensation and benefits of its employees and exempts
PPC from the coverage of the rules and regulations of the
Compensation and Position Classification Office, by virtue of Section 6
of P.D. No. 1597, the compensation system established by the PPC is,
nonetheless, subject to the review of the DBM. This Court intoned:
It should be emphasized that the review by the DBM of any PPC
resolution affecting the compensation structure of its personnel should
not be interpreted to mean that the DBM can dictate upon the PPC
Board of Directors and deprive the latter of its discretion on the matter.
Rather, the DBM's function is merely to ensure that the action taken by
the Board of Directors complies with the requirements of the law,
specifically, that PPC's compensation system "conforms as closely as
possible with that provided for under R.A. No. 6758." (Emphasis
supplied.)
As measured by the foregoing legal and jurisprudential yardsticks, the
imprimatur of the DBM must first be sought prior to implementation of
any reclassification or upgrading of positions in government. This is
consonant to the mandate of the DBM under the Revised
Administrative Code of 1987, Section 3, Chapter 1, Title XVII, to wit:
SEC. 3. Powers and Functions. – The Department of Budget
and Management shall assist the President in the preparation
of a national resources and expenditures budget, preparation,
execution and control of the National Budget, preparation and
maintenance of accounting systems essential to the
budgetary process, achievement of more economy and
efficiency in the management of government operations,
administration of compensation and position classification
systems, assessment of organizational effectiveness and
review and evaluation of legislative proposals having
budgetary or organizational implications. (Emphasis supplied.)
Irrefragably, it is within the turf of the DBM Secretary to disallow the
upgrading, reclassification, and creation of additional plantilla positions
in the CHR based on its finding that such scheme lacks legal
justification.
Notably, the CHR itself recognizes the authority of the DBM to deny or
approve the proposed reclassification of positions as evidenced by its
three letters to the DBM requesting approval thereof. As such, it is now
estopped from now claiming that the nod of approval it has previously
sought from the DBM is a superfluity.
The Court of Appeals incorrectly relied on the pronouncement of the
CSC-Central Office that the CHR is a constitutional commission, and as
such enjoys fiscal autonomy.20
Palpably, the Court of Appeals' Decision was based on the mistaken
premise that the CHR belongs to the species of constitutional
commissions. But, Article IX of the Constitution states in no uncertain
terms that only the CSC, the Commission on Elections, and the
Commission on Audit shall be tagged as Constitutional Commissions
with the appurtenant right to fiscal autonomy. Thus:
Sec. 1. The Constitutional Commissions, which shall be
independent, are the Civil Service Commission, the
Commission on Elections, and the Commission on Audit.
Sec. 5. The Commission shall enjoy fiscal autonomy. Their
approved annual appropriations shall be automatically and
regularly released.
Along the same vein, the Administrative Code, in Chapter 5, Sections
24 and 26 of Book II on Distribution of Powers of Government, the
constitutional commissions shall include only the Civil Service
Commission, the Commission on Elections, and the Commission on
Audit, which are granted independence and fiscal autonomy. In
contrast, Chapter 5, Section 29 thereof, is silent on the grant of similar
powers to the other bodies including the CHR. Thus:
SEC. 24. Constitutional Commissions. – The Constitutional
Commissions, which shall be independent, are the Civil
Service Commission, the Commission on Elections, and the
Commission on Audit.
SEC. 26. Fiscal Autonomy. – The Constitutional Commissions
shall enjoy fiscal autonomy. The approved annual
appropriations shall be automatically and regularly released.
SEC. 29. Other Bodies. – There shall be in accordance with
the Constitution, an Office of the Ombudsman, a Commission
on Human Rights, and independent central monetary
authority, and a national police commission. Likewise, as
provided in the Constitution, Congress may establish an
independent economic and planning agency. (Emphasis
ours.)
From the 1987 Constitution and the Administrative Code, it is
abundantly clear that the CHR is not among the class of Constitutional
Commissions. As expressed in the oft-repeated maxim expressio unius
est exclusio alterius, the express mention of one person, thing, act or
consequence excludes all others. Stated otherwise, expressium facit
cessare tacitum – what is expressed puts an end to what is implied.21
Nor is there any legal basis to support the contention that the CHR
enjoys fiscal autonomy. In essence, fiscal autonomy entails freedom
from outside control and limitations, other than those provided by law. It
is the freedom to allocate and utilize funds granted by law, in
accordance with law, and pursuant to the wisdom and dispatch its
needs may require from time to time.22 In Blaquera v. Alcala and
Bengzon v. Drilon,23 it is understood that it is only the Judiciary, the
Civil Service Commission, the Commission on Audit, the Commission
on Elections, and the Office of the Ombudsman, which enjoy fiscal
autonomy. Thus, in Bengzon,24 we explained:
As envisioned in the Constitution, the fiscal autonomy enjoyed
by the Judiciary, the Civil Service Commission, the
Commission on Audit, the Commission on Elections, and the
Office of the Ombudsman contemplates a guarantee of full
flexibility to allocate and utilize their resources with the
wisdom and dispatch that their needs require. It recognizes
the power and authority to levy, assess and collect fees, fix
rates of compensation not exceeding the highest rates
authorized by law for compensation and pay plans of the
government and allocate and disburse such sums as may be
provided by law or prescribed by them in the course of the
discharge of their functions.
 ... In line with its role to breathe life into the policy behind the Salary
The Judiciary, the Constitutional Commissions, and the Standardization Law of "providing equal pay for substantially equal
Ombudsman must have the independence and flexibility work and to base differences in pay upon substantive differences in
needed in the discharge of their constitutional duties. The duties and responsibilities, and qualification requirements of the
imposition of restrictions and constraints on the manner the positions," the DBM, in the case under review, made a determination,
independent constitutional offices allocate and utilize the after a thorough evaluation, that the reclassification and upgrading
funds appropriated for their operations is anathema to fiscal scheme proposed by the CHR lacks legal rationalization.
autonomy and violative not only of the express mandate of the The DBM expounded that Section 78 of the general provisions of the
Constitution but especially as regards the Supreme Court, of General Appropriations Act FY 1998, which the CHR heavily relies
the independence and separation of powers upon which the upon to justify its reclassification scheme, explicitly provides that "no
entire fabric of our constitutional system is based. In the organizational unit or changes in key positions shall be authorized
interest of comity and cooperation, the Supreme Court, [the] unless provided by law or directed by the President." Here, the DBM
Constitutional Commissions, and the Ombudsman have so far discerned that there is no law authorizing the creation of a Finance
limited their objections to constant reminders. We now agree Management Office and a Public Affairs Office in the CHR. Anent
with the petitioners that this grant of autonomy should cease CHR's proposal to upgrade twelve positions of Attorney VI, SG-26 to
to be a meaningless provision. (Emphasis supplied.) Director IV, SG-28, and four positions of Director III, SG-27 to Director
Neither does the fact that the CHR was admitted as a member by the IV, SG-28, in the Central Office, the DBM denied the same as this
Constitutional Fiscal Autonomy Group (CFAG) ipso facto clothed it with would change the context from support to substantive without actual
fiscal autonomy. Fiscal autonomy is a constitutional grant, not a tag change in functions.
obtainable by membership. This view of the DBM, as the law's designated body to implement and
We note with interest that the special provision under Rep. Act No. administer a unified compensation system, is beyond cavil. The
8522, while cited under the heading of the CHR, did not specifically interpretation of an administrative government agency, which is tasked
mention CHR as among those offices to which the special provision to to implement a statute is accorded great respect and ordinarily controls
formulate and implement organizational structures apply, but merely the construction of the courts. In Energy Regulatory Board v. Court of
states its coverage to include Constitutional Commissions and Offices Appeals,28 we echoed the basic rule that the courts will not interfere in
enjoying fiscal autonomy. In contrast, the Special Provision Applicable matters which are addressed to the sound discretion of government
to the Judiciary under Article XXVIII of the General Appropriations Act agencies entrusted with the regulation of activities coming under the
of 1998 specifically mentions that such special provision applies to the special technical knowledge and training of such agencies.
judiciary and had categorically authorized the Chief Justice of the To be sure, considering his expertise on matters affecting the nation's
Supreme Court to formulate and implement the organizational structure coffers, the Secretary of the DBM, as the President's alter ego, knows
of the Judiciary, to wit: from where he speaks inasmuch as he has the front seat view of the
1. Organizational Structure. Any provision of law to the adverse effects of an unwarranted upgrading or creation of positions in
contrary notwithstanding and within the limits of their the CHR in particular and in the entire government in general.
respective appropriations authorized in this Act, the Chief WHEREFORE, the petition is GRANTED, the Decision dated 29
Justice of the Supreme Court is authorized to formulate and November 2001 of the Court of Appeals in CA-G.R. SP No. 59678 and
implement organizational structure of the Judiciary, to fix and its Resolution dated 11 September 2002 are hereby REVERSED and
determine the salaries, allowances, and other benefits of their SET ASIDE. The ruling dated 29 March 1999 of the Civil Service
personnel, and whenever public interest so requires, make Commision-National Capital Region is REINSTATED. The Commission
adjustments in the personal services itemization including, but on Human Rights Resolution No. A98-047 dated 04 September 1998,
not limited to, the transfer of item or creation of new positions Resolution No. A98-055 dated 19 October 1998 and Resolution No.
in the Judiciary; PROVIDED, That officers and employees A98-062 dated 17 November 1998 without the approval of the
whose positions are affected by such reorganization or Department of Budget and Management are disallowed. No
adjustments shall be granted retirement gratuities and pronouncement as to costs.
separation pay in accordance with existing law, which shall be SO ORDERED.
payable from any unexpended balance of, or savings in the
appropriations of their respective offices: PROVIDED,
FURTHER, That the implementation hereof shall be in
accordance with salary rates, allowances and other benefits
authorized under compensation standardization laws.
(Emphasis supplied.)
All told, the CHR, although admittedly a constitutional creation is,
nonetheless, not included in the genus of offices accorded fiscal
autonomy by constitutional or legislative fiat.
Even assuming en arguendo that the CHR enjoys fiscal autonomy, we
share the stance of the DBM that the grant of fiscal autonomy
notwithstanding, all government offices must, all the same, kowtow to
the Salary Standardization Law. We are of the same mind with the
DBM on its standpoint, thus-
Being a member of the fiscal autonomy group does not vest the agency
with the authority to reclassify, upgrade, and create positions without
approval of the DBM. While the members of the Group are authorized
to formulate and implement the organizational structures of their
respective offices and determine the compensation of their personnel,
such authority is not absolute and must be exercised within the
parameters of the Unified Position Classification and Compensation
System established under RA 6758 more popularly known as the
Compensation Standardization Law.25 (Emphasis supplied.)
The most lucid argument against the stand of respondent, however, is
the provision of Rep. Act No. 8522 "that the implementation hereof shall
be in accordance with salary rates, allowances and other benefits
authorized under compensation standardization laws."26
Indeed, the law upon which respondent heavily anchors its case upon
has expressly provided that any form of adjustment in the
organizational structure must be within the parameters of the Salary
Standardization Law.
The Salary Standardization Law has gained impetus in addressing one
of the basic causes of discontent of many civil servants.27 For this
purpose, Congress has delegated to the DBM the power to administer
the Salary Standardization Law and to ensure that the spirit behind it is
observed. This power is part of the system of checks and balances or
system of restraints in our government. The DBM's exercise of such
authority is not in itself an arrogation inasmuch as it is pursuant to the
paramount law of the land, the Salary Standardization Law and the
Administrative Code.
G.R. No. 157509             January 18, 2005
AUTOMOTIVE INDUSTRY WORKERS ALLIANCE (AIWA) and its
Affiliated Unions: Mitsubishi Motors Workers Phils. Union;
Mitsubishi Motors Phils. Supervisors Union, Nissan Motors Phils.,
Inc. Workers Union, Toyota Motors Phils. Workers Union,
DURASTEEL WORKERS UNION, FILSHUTTERS EMPLOYEES &
WORKERS UNION, NATIONAL LABOR UNION, PEPSI-COLA
SUPERVISORS AND EMPLOYEES UNION, PSBA FACULTY
ASSOCIATION, PLDT SECURITY PERSONNEL UNION,
PUREFOODS UNIFIED LABOR ORGANIZATION, SAMAHANG
MANGGAGAWA NG BICUTAN CONTAINERS CORP., SAMAHANG
MANGGAGAWA NG CINDERELLA, SAMAHANG MANGGAGAWA
NG LAURA’S FOOD PRODUCTS, petitioners,
vs.
HON. ALBERTO ROMULO, in his capacity as Executive Secretary,
and HON. PATRICIA STO. TOMAS, in her capacity as Secretary of
Labor and Employment, respondents.
DECISION
CHICO-NAZARIO, J.:
Petitioners, composed of ten (10) labor unions, call upon this Court to
exercise its power of judicial review to declare as unconstitutional an
executive order assailed to be in derogation of the constitutional
doctrine of separation of powers.
In an original action for certiorari, petitioners invoke their status as labor
unions and as taxpayers whose rights and interests are allegedly
violated and prejudiced by Executive Order No. 185 dated 10 March
2003 whereby administrative supervision over the National Labor
Relations Commission (NLRC), its regional branches and all its
personnel including the executive labor arbiters and labor arbiters was
transferred from the NLRC Chairperson to the Secretary of Labor and
Employment. In support of their position, 1 petitioners argue that the
NLRC -- created by Presidential Decree No. 442, otherwise known as
the Labor Code, during Martial Law – was an integral part of the
Department (then Ministry) of Labor and Employment (DOLE) under the
administrative supervision of the Secretary of Justice. During the time
of President Corazon C. Aquino, and while she was endowed with
legislative functions after EDSA I, Executive Order No. 292 2 was issued
whereby the NLRC became an agency attached to the DOLE for policy
and program coordination and for administrative supervision. On 02
March 1989, Article 213 of the Labor Code was expressly amended by
Republic Act No. 6715 declaring that the NLRC was to be attached to
the DOLE for program and policy coordination only while the
administrative supervision over the NLRC, its regional branches and
personnel, was turned over to the NLRC Chairman. The subject E.O.
No. 185, in authorizing the Secretary of Labor to exercise administrative
supervision over the NLRC, its regional branches and personnel,
allegedly reverted to the pre-Rep. Act No. 6715 set-up, amending the
latter law which only Congress can do.
The respondents herein, as represented by the Office of the Solicitor
General, opposed the petition on procedural 3 and substantive4 grounds.
Procedurally, it is alleged that the petition does not pose an actual case
or controversy upon which judicial review may be exercised as
petitioners have not specifically cited how E.O. No. 185 has prejudiced
or threatened to prejudice their rights and existence as labor unions
and as taxpayers. Closely intertwined therewith, respondents further
argue that petitioners have no locus standi to assail the validity of E.O.
No. 185, not even in their capacity as taxpayers, considering that labor
unions are exempt from paying taxes, citing Sec. 30 of the Tax Reform
Act of 1997. Even assuming that their individual members are
taxpayers, respondents maintain that a taxpayer suit will not prosper as
E.O. No. 185 does not require additional appropriation for its
implementation. As the petition can be decided without passing on the
validity of the subject executive order, respondents conclude that the
same should be forthwith dismissed.
Even on the merits, respondents advance the view that the petition
must fail as the administrative supervision granted by the Labor Code
to the NLRC Chairman over the NLRC, its regional branches and
personnel, does not place them beyond the President’s broader power
of control and supervision, a power conferred no less than by the
Constitution in Section 17, Article VII thereof. Thus, in the exercise of
the President’s power of control and supervision, he can generally
oversee the operations of the NLRC, its regional branches and
personnel thru his alter ego, the Secretary of Labor, pursuant to the
doctrine of qualified political agency.
In their Reply,5 petitioners affirm their locus standi contending that they
are suing for and in behalf of their members – estimated to be more or
less fifty thousand (50,000) workers – who are the real parties to be
affected by the resolution of this Court. They likewise maintain that they
are suing in behalf of the employees of the NLRC who have pending
cases for dismissal. Thus, possessed of the necessary standing,
petitioners theorize that the issue before this Court must necessarily be
decided as it involves an act of the Chief Executive amending a
provision of law.
For clarity, E.O. No. 185 is hereby quoted:
EXECUTIVE ORDER NO. 185
AUTHORIZING THE SECRETARY OF LABOR AND EMPLOYMENT
TO EXERCISE ADMINISTRATIVE SUPERVISION OVER THE
NATIONAL LABOR RELATIONS COMMISSION
WHEREAS, Section 17, Article VII of the Constitution provides that the
President shall have control of all executive departments, bureaus and
offices and shall ensure that the laws be faithfully executed;
WHEREAS, the National Labor Relations Commission (NLRC) which
was created by virtue of Presidential Decree No. 442, otherwise known
as the "Labor Code of the Philippines," is an agency under the
Executive Department and was originally envisaged as being an
integral part of the Department (then Ministry) of Labor and
Employment (DOLE) under the administrative supervision of the
Secretary of Labor and Employment ("Secretary of Labor");
WHEREAS, upon the issuance of Executive Order No. 292, otherwise
known as the "Revised Administrative Code of 1987" (the
"Administrative Code"), the NLRC, by virtue of Section 25, Chapter 6,
Title VII, Book IV thereof, became an agency attached to the DOLE for
policy and program coordination and administrative supervision;
WHEREAS, Article 213 of the Labor Code and Section 25, Chapter 6,
Title VII, Book IV of the Administrative Code were amended by
Republic Act. No. 6715 approved on March 2, 1989, which provides
that the NLRC shall be attached to the DOLE for program and policy
coordination only and transferred administrative supervision over the
NLRC, all its regional branches and personnel to the NLRC Chairman;
WHEREAS, Section 16, Article III of the Constitution guarantees the
right of all persons to a speedy disposition of their cases before all
judicial, quasi-judicial and administrative bodies;
WHEREAS, the Secretary of Labor, after evaluating the NLRC’s
performance record in the last five (5) years, including the rate of
disposition of pending cases before it, has informed the President that
there is a need to expedite the disposition of labor cases pending
before the NLRC and all its regional and sub-regional branches or
provincial extension units and initiate potent measures to prevent graft
and corruption therein so as to reform its systems and personnel, as
well as infuse the organization with a sense of public service in
consonance with the imperative of change for the greater interest of the
people;
WHEREAS, after consultations with the relevant sectors, the Secretary
of Labor has recommended that the President, pursuant to her powers
under the Constitution and existing laws, authorize the Secretary of
Labor to exercise administrative supervision over the NLRC and all its
regional and sub-regional branches or provincial extension units with
the objective of improving the rate of disposition of pending cases and
institute adequate measures for the prevention of graft and corruption
within the said agency;
NOW, THEREFORE, I, GLORIA MACAPAGAL ARROYO, President of
the Republic of the Philippines, by virtue of the powers vested in me by
the Constitution and existing laws, do hereby order:
SECTION 1. Authority To Exercise Administrative Supervision. – The
Secretary of Labor is hereby authorized to exercise administrative
supervision over the NLRC, its regional branches and all its personnel,
including the Executive Labor Arbiters and Labor Arbiters, with the
objective of improving the rate of disposition of cases pending before it
and its regional and sub-regional branches or provincial extension units
and to institute adequate measures for the prevention of graft and
corruption within the said agency.
For this purpose, the Secretary of Labor shall, among others:
a. Generally oversee the operations of the NLRC
and its regional and sub-regional branches or
provincial extension units for the purpose of
ensuring that cases pending before them are
decided or resolved expeditiously;
b. Require the submission of reports as the
Secretary of Labor may deem necessary;
c. Initiate measures within the agency to prevent
graft and corruption, including but not limited to, the
conduct of management audits, performance
evaluations and inspections to determine
compliance with established policies, standards and
guidelines;
d. To take such action as may be necessary for the
proper performance of official functions, including
rectification of violations, abuses and other forms of
mal-administration; and
e. Investigate, on its own or upon complaint, matters
involving disciplinary action against any of the
NLRC’s personnel, including Presidential
appointees, in accordance with existing laws, rules
and regulations. After completing his/her
investigation, the Secretary of Labor shall submit a
report to the President on the investigation
conducted with a recommendation as to the penalty
to be imposed or other action to be taken, including
 referral to the Presidential Anti-Graft Commission
(PAGC), the Office of the Ombudsman or any other
office, committee, commission, agency, department,
instrumentality or branch of the government for
appropriate action.
The authority conferred herein upon the Secretary of Labor shall not
extend to the power to review, reverse, revise, or modify the decisions
of the NLRC in the exercise of its quasi-judicial functions (cf. Section
38(2) (b), Chapter 7, Book IV, Administrative Code).
SECTION 2. Report to the Secretary of Labor. – The NLRC, through its
Chairman, shall submit a report to the Secretary of Labor within thirty
(30) days from issuance of this Executive Order, on the following
matters:
a. Performance Report/Audit for the last five (5)
years, including list of pending cases and cases
disposed of within the said period by the NLRC en
banc, by Division and by the Labor Arbiters in each
of its regional and sub-regional branches or
provincial extension units;
b. Detailed Master Plan on how to liquidate its
backlog of cases with clear timetables to clean up its
dockets within six (6) months from the issuance
hereof;
c. Complete inventory of its assets and list of
personnel indicating their present positions and
stations; and
d. Such other matters as may be required by the
Secretary of Labor.
SECTION 3. Rules and Regulations. – The Secretary of Labor, in
consultation with the Chairman of the NLRC, is hereby authorized to
issue rules and regulations for the effective implementation of the
provisions of this Executive Order.
SECTION 4. Repealing Clause. All laws, executive issuances, rules
and regulations or parts thereof which are inconsistent with the
provisions of this Executive Order are hereby repealed, amended, or
modified accordingly.
SECTION 5. Effectivity. – This Executive Order shall take effect
immediately upon the completion of its publication in the Official
Gazette or in a newspaper of general circulation in the country.
City of Manila, March 10, 2003.6
The constitutionality of a governmental act having been challenged, it
comes as no surprise that the first line of defense is to question the
standing of petitioners and the justiciability of herein case.
It is hornbook doctrine that the exercise of the power of judicial review
requires the concurrence of the following requisites, namely: (1) the
existence of an appropriate case; (2) an interest personal and
substantial by the party raising the constitutional question; (3) the plea
that the function be exercised at the earliest opportunity; and (4) the
necessity that the constitutional question be passed upon in order to
decide the case.71awphi1.nét
As correctly pointed out by respondents, judicial review cannot be
exercised in vacuo. The function of the courts is to determine
controversies between litigants and not to give advisory opinions. 8 The
power of judicial review can only be exercised in connection with a
bona fide case or controversy which involves the statute sought to be
reviewed.9
Even with the presence of an actual case or controversy, the Court may
refuse to exercise judicial review unless the constitutional question is
brought before it by a party having the requisite standing to challenge
it.10 Legal standing or locus standi is defined as a "personal and
substantial interest in the case such that the party has sustained or will
sustain direct injury as a result of the governmental act that is being
challenged."11 For a citizen to have standing, he must establish that he
has suffered some actual or threatened injury as a result of the
allegedly illegal conduct of the government; the injury is fairly traceable
to the challenged action; and the injury is likely to be redressed by a
favorable action.12
Petitioners have not shown that they have sustained or are in danger of
sustaining any personal injury attributable to the enactment of E.O. No.
185. As labor unions representing their members, it cannot be said that
E.O. No. 185 will prejudice their rights and interests considering that the
scope of the authority conferred upon the Secretary of Labor does not
extend to the power to review, reverse, revise or modify the decisions
of the NLRC in the exercise of its quasi-judicial functions. 13 Thus, only
NLRC personnel who may find themselves the subject of the Secretary
of Labor’s disciplinary authority, conferred by Section 1(d) of the subject
executive order, may be said to have a direct and specific interest in
raising the substantive issue herein. Moreover, and if at all, only
Congress, and not petitioners, can claim any injury 14 from the alleged
executive encroachment of the legislative function to amend, modify
and/or repeal laws.
Neither can standing be conferred on petitioners as taxpayers since
petitioners have not established disbursement of public funds in
contravention of law or the Constitution. 15 A taxpayer’s suit is properly
brought only when there is an exercise of the spending or taxing power
of Congress.16 As correctly pointed out by respondents, E.O. No. 185
does not even require for its implementation additional appropriation.
All told, if we were to follow the strict rule on locus standi, this petition
should be forthwith dismissed on that score. The rule on standing,
however, is a matter of procedure, hence, can be relaxed for
nontraditional plaintiffs like ordinary citizens, taxpayers and legislators
when the public interest so requires, such as when the matter is of
transcendental importance, of overarching significance to society, or of
paramount public interest.171awphi1.nét
The question is, does the issue posed in this petition meet the exacting
standard required for this Court to take the liberal approach and
recognize the standing of herein petitioners?
The instant petition fails to persuade us.
The subject matter of E.O. No. 185 is the grant of authority by the
President to the Secretary of Labor to exercise administrative
supervision over the NLRC, its regional branches and all its personnel,
including the Executive Labor Arbiters and Labor Arbiters. Its impact,
sans the challenge to its constitutionality, is thereby limited to the
departments to which it is addressed. Taking our cue from the early
case of Olsen v. Herstein and Rafferty,18 the subject executive order
can be considered as nothing more or less than a command from a
superior to an inferior. It creates no relation except between the official
who issued it and the officials who received it. It has for its object simply
the efficient and economical administration of the affairs of the
department to which it is issued in accordance with the law governing
the subject matter. Administrative in its nature, the subject order does
not pass beyond the limits of the departments to which it is directed,
hence, it has not created any rights in third persons, not even in the fifty
thousand or so union members being represented by petitioners who
may or may not have pending cases before the labor arbiters or the
NLRC.
In fine, considering that the governmental act being questioned has a
limited reach, its impact confined to corridors of the executive
department, this is not one of those exceptional occasions where the
Court is justified in sweeping aside a critical procedural requirement,
rooted as it is in the constitutionally enshrined principle of separation of
powers. As succinctly put by Mr. Justice Reynato S. Puno in his
dissenting opinion in the first Kilosbayan case:19
. . . [C]ourts are neither free to decide all kinds of cases dumped into
their laps nor are they free to open their doors to all parties or entities
claiming a grievance. The rationale for this constitutional requirement of
locus standi is by no means trifle. It is intended "to assure a vigorous
adversary presentation of the case, and, perhaps more importantly to
warrant the judiciary’s overruling the determination of a coordinate,
democratically elected organ of government." 20 It thus goes to the very
essence of representative democracies.
...
A lesser but not insignificant reason for screening the standing of
persons who desire to litigate constitutional issues is economic in
character. Given the sparseness of our resources, the capacity of
courts to render efficient judicial service to our people is severely
limited. For courts to indiscriminately open their doors to all types of
suits and suitors is for them to unduly overburden their dockets, and
ultimately render themselves ineffective dispensers of justice. To be
sure, this is an evil that clearly confronts our judiciary today.
All things considered, whether or not E.O. No. 185 is indeed
unconstitutional will have to await the proper party in a proper case to
assail its validity.
WHEREFORE, premises considered, the instant petition dated 27
March 2003 is hereby DISMISSED for lack of merit. No costs.
SO ORDERED.
G.R. No. L-63915           April 24, 1985
LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and
MOVEMENT OF ATTORNEYS FOR BROTHERHOOD, INTEGRITY
AND NATIONALISM, INC. [MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to
the President, HON. JOAQUIN VENUS, in his capacity as Deputy
Executive Assistant to the President , MELQUIADES P. DE LA
CRUZ, in his capacity as Director, Malacañang Records Office, and
FLORENDO S. PABLO, in his capacity as Director, Bureau of
Printing, respondents.
 
DECISION
ESCOLIN, J.:
Invoking the people’s right to be informed on matters of public concern,
a right recognized in Section 6, Article IV of the 1973 Philippine
Constitution, 1 as well as the principle that laws to be valid and
enforceable must be published in the Official Gazette or otherwise
effectively promulgated, petitioners seek a writ of mandamus to compel
respondent public officials to publish, and/or cause the publication in
the Official Gazette of various presidential decrees, letters of
instructions, general orders, proclamations, executive orders, letter of
implementation and administrative orders.
Specifically, the publication of the following presidential issuances is
sought:
a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171, 179, 184,
197, 200, 234, 265, 286, 298, 303, 312, 324, 325, 326, 337, 355, 358,
359, 360, 361, 368, 404, 406, 415, 427, 429, 445, 447, 473, 486, 491,
503, 504, 521, 528, 551, 566, 573, 574, 594, 599, 644, 658, 661, 718,
731, 733, 793, 800, 802, 835, 836, 923, 935, 961, 1017-1030, 1050,
1060-1061, 1085, 1143, 1165, 1166, 1242, 1246, 1250, 1278, 1279,
1300, 1644, 1772, 1808, 1810, 1813-1817, 1819-1826, 1829-1840,
1842-1847.
b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130, 136,
141, 150, 153, 155, 161, 173, 180, 187, 188, 192, 193, 199, 202, 204,
205, 209, 211-213, 215-224, 226-228, 231-239, 241-245, 248, 251,
253-261, 263-269, 271-273, 275-283, 285-289, 291, 293, 297-299,
301-303, 309, 312-315, 325, 327, 343, 346, 349, 357, 358, 362, 367,
370, 382, 385, 386, 396-397, 405, 438-440, 444- 445, 473, 486, 488,
498, 501, 399, 527, 561, 576, 587, 594, 599, 600, 602, 609, 610, 611,
612, 615, 641, 642, 665, 702, 712-713, 726, 837-839, 878-879, 881,
882, 939-940, 964,997,1149-1178,1180-1278.
c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.
d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270, 1281,
1319-1526, 1529, 1532, 1535, 1538, 1540-1547, 1550-1558, 1561-
1588, 1590-1595, 1594-1600, 1606-1609, 1612-1628, 1630-1649,
1694-1695, 1697-1701, 1705-1723, 1731-1734, 1737-1742, 1744,
1746-1751, 1752, 1754, 1762, 1764-1787, 1789-1795, 1797, 1800,
1802-1804, 1806-1807, 1812-1814, 1816, 1825-1826, 1829, 1831-
1832, 1835-1836, 1839-1840, 1843-1844, 1846-1847, 1849, 1853-
1858, 1860, 1866, 1868, 1870, 1876-1889, 1892, 1900, 1918, 1923,
1933, 1952, 1963, 1965-1966, 1968-1984, 1986-2028, 2030-2044,
2046-2145, 2147-2161, 2163-2244.
e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457- 471, 474-
492, 494-507, 509-510, 522, 524-528, 531-532, 536, 538, 543-544,
549, 551-553, 560, 563, 567-568, 570, 574, 593, 594, 598-604, 609,
611- 647, 649-677, 679-703, 705-707, 712-786, 788-852, 854-857.
f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39, 50, 51,
59, 76, 80-81, 92, 94, 95, 107, 120, 122, 123.
g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378, 380-433,
436-439.
The respondents, through the Solicitor General, would have this case
dismissed outright on the ground that petitioners have no legal
personality or standing to bring the instant petition. The view is
submitted that in the absence of any showing that petitioners are
personally and directly affected or prejudiced by the alleged non-
publication of the presidential issuances in question 2 said petitioners
are without the requisite legal personality to institute this mandamus
proceeding, they are not being “aggrieved parties” within the meaning
of Section 3, Rule 65 of the Rules of Court, which we quote:
SEC. 3. Petition for Mandamus.—When any tribunal, corporation, board
or person unlawfully neglects the performance of an act which the law
specifically enjoins as a duty resulting from an office, trust, or station, or
unlawfully excludes another from the use a rd enjoyment of a right or
office to which such other is entitled, and there is no other plain, speedy
and adequate remedy in the ordinary course of law, the person
aggrieved thereby may file a verified petition in the proper court alleging
the facts with certainty and praying that judgment be rendered
commanding the defendant, immediately or at some other specified
time, to do the act required to be done to Protect the rights of the
petitioner, and to pay the damages sustained by the petitioner by
reason of the wrongful acts of the defendant.
Upon the other hand, petitioners maintain that since the subject of the
petition concerns a public right and its object is to compel the
performance of a public duty, they need not show any specific interest
for their petition to be given due course.
The issue posed is not one of first impression. As early as the 1910
case of Severino vs. Governor General, 3 this Court held that while the
general rule is that “a writ of mandamus would be granted to a private
individual only in those cases where he has some private or particular
interest to be subserved, or some particular right to be protected,
independent of that which he holds with the public at large,” and “it is
for the public officers exclusively to apply for the writ when public rights
are to be subserved [Mithchell vs. Boardmen, 79 M.e., 469],”
nevertheless, “when the question is one of public right and the object of
the mandamus is to procure the enforcement of a public duty, the
people are regarded as the real party in interest and the relator at
whose instigation the proceedings are instituted need not show that he
has any legal or special interest in the result, it being sufficient to show
that he is a citizen and as such interested in the execution of the laws
[High, Extraordinary Legal Remedies, 3rd ed., sec. 431].
Thus, in said case, this Court recognized the relator Lope Severino, a
private individual, as a proper party to the mandamus proceedings
brought to compel the Governor General to call a special election for
the position of municipal president in the town of Silay, Negros
Occidental. Speaking for this Court, Mr. Justice Grant T. Trent said:
We are therefore of the opinion that the weight of authority supports the
proposition that the relator is a proper party to proceedings of this
character when a public right is sought to be enforced. If the general
rule in America were otherwise, we think that it would not be applicable
to the case at bar for the reason ‘that it is always dangerous to apply a
general rule to a particular case without keeping in mind the reason for
the rule, because, if under the particular circumstances the reason for
the rule does not exist, the rule itself is not applicable and reliance upon
the rule may well lead to error’
No reason exists in the case at bar for applying the general rule insisted
upon by counsel for the respondent. The circumstances which surround
this case are different from those in the United States, inasmuch as if
the relator is not a proper party to these proceedings no other person
could be, as we have seen that it is not the duty of the law officer of the
Government to appear and represent the people in cases of this
character.
The reasons given by the Court in recognizing a private citizen’s legal
personality in the aforementioned case apply squarely to the present
petition. Clearly, the right sought to be enforced by petitioners herein is
a public right recognized by no less than the fundamental law of the
land. If petitioners were not allowed to institute this proceeding, it would
indeed be difficult to conceive of any other person to initiate the same,
considering that the Solicitor General, the government officer generally
empowered to represent the people, has entered his appearance for
respondents in this case.
Respondents further contend that publication in the Official Gazette is
not a sine qua non requirement for the effectivity of laws where the laws
themselves provide for their own effectivity dates. It is thus submitted
that since the presidential issuances in question contain special
provisions as to the date they are to take effect, publication in the
Official Gazette is not indispensable for their effectivity. The point
stressed is anchored on Article 2 of the Civil Code:
Art. 2. Laws shall take effect after fifteen days following the completion
of their publication in the Official Gazette, unless it is otherwise
provided, …
The interpretation given by respondent is in accord with this Court’s
construction of said article. In a long line of decisions,  4 this Court has
ruled that publication in the Official Gazette is necessary in those cases
where the legislation itself does not provide for its effectivity date-for
then the date of publication is material for determining its date of
effectivity, which is the fifteenth day following its publication-but not
when the law itself provides for the date when it goes into effect.
Respondents’ argument, however, is logically correct only insofar as it
equates the effectivity of laws with the fact of publication. Considered in
the light of other statutes applicable to the issue at hand, the conclusion
is easily reached that said Article 2 does not preclude the requirement
of publication in the Official Gazette, even if the law itself provides for
the date of its effectivity. Thus, Section 1 of Commonwealth Act 638
provides as follows:
Section 1. There shall be published in the Official Gazette [1] all
important legisiative acts and resolutions of a public nature of the,
Congress of the Philippines; [2] all executive and administrative orders
and proclamations, except such as have no general applicability; [3]
decisions or abstracts of decisions of the Supreme Court and the Court
of Appeals as may be deemed by said courts of sufficient importance to
be so published; [4] such documents or classes of documents as may
be required so to be published by law; and [5] such documents or
classes of documents as the President of the Philippines shall
determine from time to time to have general applicability and legal
effect, or which he may authorize so to be published. …
The clear object of the above-quoted provision is to give the general Similarly, the implementation/enforcement of presidential decrees prior
public adequate notice of the various laws which are to regulate their to their publication in the Official Gazette is “an operative fact which
actions and conduct as citizens. Without such notice and publication, may have consequences which cannot be justly ignored. The past
there would be no basis for the application of the maxim “ignorantia cannot always be erased by a new judicial declaration … that an all-
legis non excusat.” It would be the height of injustice to punish or inclusive statement of a principle of absolute retroactive invalidity
otherwise burden a citizen for the transgression of a law of which he cannot be justified.”
had no notice whatsoever, not even a constructive one. From the report submitted to the Court by the Clerk of Court, it appears
Perhaps at no time since the establishment of the Philippine Republic that of the presidential decrees sought by petitioners to be published in
has the publication of laws taken so vital significance that at this time the Official Gazette, only Presidential Decrees Nos. 1019 to 1030,
when the people have bestowed upon the President a power heretofore inclusive, 1278, and 1937 to 1939, inclusive, have not been so
enjoyed solely by the legislature. While the people are kept abreast by published. 10 Neither the subject matters nor the texts of these PDs can
the mass media of the debates and deliberations in the Batasan be ascertained since no copies thereof are available. But whatever their
Pambansa—and for the diligent ones, ready access to the legislative subject matter may be, it is undisputed that none of these unpublished
records—no such publicity accompanies the law-making process of the PDs has ever been implemented or enforced by the government.
President. Thus, without publication, the people have no means of In Pesigan vs. Angeles, 11 the Court, through Justice Ramon Aquino,
knowing what presidential decrees have actually been promulgated, ruled that “publication is necessary to apprise the public of the contents
much less a definite way of informing themselves of the specific of [penal] regulations and make the said penalties binding on the
contents and texts of such decrees. As the Supreme Court of Spain persons affected thereby. ” The cogency of this holding is apparently
ruled: “Bajo la denominacion generica de leyes, se comprenden recognized by respondent officials considering the manifestation in their
tambien los reglamentos, Reales decretos, Instrucciones, Circulares y comment that “the government, as a matter of policy, refrains from
Reales ordines dictadas de conformidad con las mismas por el prosecuting violations of criminal laws until the same shall have been
Gobierno en uso de su potestad. 5 published in the Official Gazette or in some other publication, even
The very first clause of Section I of Commonwealth Act 638 reads: though some criminal laws provide that they shall take effect
“There shall be published in the Official Gazette … .” The word “shall” immediately.
used therein imposes upon respondent officials an imperative duty. WHEREFORE, the Court hereby ORDERS respondents TO
That duty must be enforced if the Constitutional right of the people to be PUBLISH in the Official Gazette all unpublished presidential issuances
informed on matters of public concern is to be given substance and which are of general application, and unless so published, they shall
reality. The law itself makes a list of what should be published in the have no binding force and effect.
Official Gazette. Such listing, to our mind, leaves respondents with no SO ORDERED.
discretion whatsoever as to what must be included or excluded from
such publication.
The publication of all presidential issuances “of a public nature” or “of
general applicability” is mandated by law. Obviously, presidential
decrees that provide for fines, forfeitures or penalties for their violation
or otherwise impose a burden or. the people, such as tax and revenue
measures, fall within this category. Other presidential issuances which
apply only to particular persons or class of persons such as
administrative and executive orders need not be published on the
assumption that they have been circularized to all concerned. 6
It is needless to add that the publication of presidential issuances “of a
public nature” or “of general applicability” is a requirement of due
process. It is a rule of law that before a person may be bound by law,
he must first be officially and specifically informed of its contents. As
Justice Claudio Teehankee said in Peralta vs. COMELEC 7:
In a time of proliferating decrees, orders and letters of instructions
which all form part of the law of the land, the requirement of due
process and the Rule of Law demand that the Official Gazette as the
official government repository promulgate and publish the texts of all
such decrees, orders and instructions so that the people may know
where to obtain their official and specific contents.
The Court therefore declares that presidential issuances of general
application, which have not been published, shall have no force and
effect. Some members of the Court, quite apprehensive about the
possible unsettling effect this decision might have on acts done in
reliance of the validity of those presidential decrees which were
published only during the pendency of this petition, have put the
question as to whether the Court’s declaration of invalidity apply to
P.D.s which had been enforced or implemented prior to their
publication. The answer is all too familiar. In similar situations in the
past this Court had taken the pragmatic and realistic course set forth
in Chicot County Drainage District vs. Baxter Bank 8 to wit:
The courts below have proceeded on the theory that the Act of
Congress, having been found to be unconstitutional, was not a law; that
it was inoperative, conferring no rights and imposing no duties, and
hence affording no basis for the challenged decree. Norton v. Shelby
County, 118 U.S. 425, 442; Chicago, 1. & L. Ry. Co. v. Hackett, 228
U.S. 559, 566. It is quite clear, however, that such broad statements as
to the effect of a determination of unconstitutionality must be taken with
qualifications. The actual existence of a statute, prior to such a
determination, is an operative fact and may have consequences which
cannot justly be ignored. The past cannot always be erased by a new
judicial declaration. The effect of the subsequent ruling as to invalidity
may have to be considered in various aspects-with respect to particular
conduct, private and official. Questions of rights claimed to have
become vested, of status, of prior determinations deemed to have
finality and acted upon accordingly, of public policy in the light of the
nature both of the statute and of its previous application, demand
examination. These questions are among the most difficult of those
which have engaged the attention of courts, state and federal and it is
manifest from numerous decisions that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be justified.
Consistently with the above principle, this Court in Rutter vs.
Esteban  9 sustained the right of a party under the Moratorium Law,
albeit said right had accrued in his favor before said law was declared
unconstitutional by this Court.
G.R. No. 133250           July 9, 2002
FRANCISCO I. CHAVEZ, petitioner,
vs.
PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY
DEVELOPMENT CORPORATION, respondents.
CARPIO, J.:
This is an original Petition for Mandamus with prayer for a writ of
preliminary injunction and a temporary restraining order. The petition
seeks to compel the Public Estates Authority ("PEA" for brevity) to
disclose all facts on PEA's then on-going renegotiations with Amari
Coastal Bay and Development Corporation ("AMARI" for brevity) to
reclaim portions of Manila Bay. The petition further seeks to enjoin PEA
from signing a new agreement with AMARI involving such reclamation.
The Facts
On November 20, 1973, the government, through the Commissioner of
Public Highways, signed a contract with the Construction and
Development Corporation of the Philippines ("CDCP" for brevity) to
reclaim certain foreshore and offshore areas of Manila Bay. The
contract also included the construction of Phases I and II of the Manila-
Cavite Coastal Road. CDCP obligated itself to carry out all the works in
consideration of fifty percent of the total reclaimed land.
On February 4, 1977, then President Ferdinand E. Marcos issued
Presidential Decree No. 1084 creating PEA. PD No. 1084 tasked PEA
"to reclaim land, including foreshore and submerged areas," and "to
develop, improve, acquire, x x x lease and sell any and all kinds of
lands."1 On the same date, then President Marcos issued Presidential
Decree No. 1085 transferring to PEA the "lands reclaimed in the
foreshore and offshore of the Manila Bay" 2 under the Manila-Cavite
Coastal Road and Reclamation Project (MCCRRP).
On December 29, 1981, then President Marcos issued a memorandum
directing PEA to amend its contract with CDCP, so that "[A]ll future
works in MCCRRP x x x shall be funded and owned by PEA."
Accordingly, PEA and CDCP executed a Memorandum of Agreement
dated December 29, 1981, which stated:
"(i) CDCP shall undertake all reclamation, construction, and
such other works in the MCCRRP as may be agreed upon by
the parties, to be paid according to progress of works on a
unit price/lump sum basis for items of work to be agreed
upon, subject to price escalation, retention and other terms
and conditions provided for in Presidential Decree No. 1594.
All the financing required for such works shall be provided by
PEA.
xxx
(iii) x x x CDCP shall give up all its development rights and
hereby agrees to cede and transfer in favor of PEA, all of the
rights, title, interest and participation of CDCP in and to all the
areas of land reclaimed by CDCP in the MCCRRP as of
December 30, 1981 which have not yet been sold, transferred
or otherwise disposed of by CDCP as of said date, which
areas consist of approximately Ninety-Nine Thousand Four
Hundred Seventy Three (99,473) square meters in the
Financial Center Area covered by land pledge No. 5 and
approximately Three Million Three Hundred Eighty Two
Thousand Eight Hundred Eighty Eight (3,382,888) square
meters of reclaimed areas at varying elevations above Mean
Low Water Level located outside the Financial Center Area
and the First Neighborhood Unit."3
On January 19, 1988, then President Corazon C. Aquino issued
Special Patent No. 3517, granting and transferring to PEA "the parcels
of land so reclaimed under the Manila-Cavite Coastal Road and
Reclamation Project (MCCRRP) containing a total area of one million
nine hundred fifteen thousand eight hundred ninety four (1,915,894)
square meters." Subsequently, on April 9, 1988, the Register of Deeds
of the Municipality of Parañaque issued Transfer Certificates of Title
Nos. 7309, 7311, and 7312, in the name of PEA, covering the three
reclaimed islands known as the "Freedom Islands" located at the
southern portion of the Manila-Cavite Coastal Road, Parañaque City.
The Freedom Islands have a total land area of One Million Five
Hundred Seventy Eight Thousand Four Hundred and Forty One
(1,578,441) square meters or 157.841 hectares.
On April 25, 1995, PEA entered into a Joint Venture Agreement ("JVA"
for brevity) with AMARI, a private corporation, to develop the Freedom
Islands. The JVA also required the reclamation of an additional 250
hectares of submerged areas surrounding these islands to complete
the configuration in the Master Development Plan of the Southern
Reclamation Project-MCCRRP. PEA and AMARI entered into the JVA
through negotiation without public bidding. 4 On April 28, 1995, the
Board of Directors of PEA, in its Resolution No. 1245, confirmed the
JVA.5 On June 8, 1995, then President Fidel V. Ramos, through then
Executive Secretary Ruben Torres, approved the JVA.6
On November 29, 1996, then Senate President Ernesto Maceda
delivered a privilege speech in the Senate and denounced the JVA as
the "grandmother of all scams." As a result, the Senate Committee on
Government Corporations and Public Enterprises, and the Committee
on Accountability of Public Officers and Investigations, conducted a
joint investigation. The Senate Committees reported the results of their
investigation in Senate Committee Report No. 560 dated September
16, 1997.7 Among the conclusions of their report are: (1) the reclaimed
lands PEA seeks to transfer to AMARI under the JVA are lands of the
public domain which the government has not classified as alienable
lands and therefore PEA cannot alienate these lands; (2) the
certificates of title covering the Freedom Islands are thus void, and (3)
the JVA itself is illegal.
On December 5, 1997, then President Fidel V. Ramos issued
Presidential Administrative Order No. 365 creating a Legal Task Force
to conduct a study on the legality of the JVA in view of Senate
Committee Report No. 560. The members of the Legal Task Force
were the Secretary of Justice,8 the Chief Presidential Legal Counsel, 9
and the Government Corporate Counsel. 10 The Legal Task Force
upheld the legality of the JVA, contrary to the conclusions reached by
the Senate Committees.11
On April 4 and 5, 1998, the Philippine Daily Inquirer and Today
published reports that there were on-going renegotiations between PEA
and AMARI under an order issued by then President Fidel V. Ramos.
According to these reports, PEA Director Nestor Kalaw, PEA Chairman
Arsenio Yulo and retired Navy Officer Sergio Cruz composed the
negotiating panel of PEA.
On April 13, 1998, Antonio M. Zulueta filed before the Court a Petition
for Prohibition with Application for the Issuance of a Temporary
Restraining Order and Preliminary Injunction docketed as G.R. No.
132994 seeking to nullify the JVA. The Court dismissed the petition "for
unwarranted disregard of judicial hierarchy, without prejudice to the
refiling of the case before the proper court." 12
On April 27, 1998, petitioner Frank I. Chavez ("Petitioner" for brevity) as
a taxpayer, filed the instant Petition for Mandamus with Prayer for the
Issuance of a Writ of Preliminary Injunction and Temporary Restraining
Order. Petitioner contends the government stands to lose billions of
pesos in the sale by PEA of the reclaimed lands to AMARI. Petitioner
prays that PEA publicly disclose the terms of any renegotiation of the
JVA, invoking Section 28, Article II, and Section 7, Article III, of the
1987 Constitution on the right of the people to information on matters of
public concern. Petitioner assails the sale to AMARI of lands of the
public domain as a blatant violation of Section 3, Article XII of the 1987
Constitution prohibiting the sale of alienable lands of the public domain
to private corporations. Finally, petitioner asserts that he seeks to
enjoin the loss of billions of pesos in properties of the State that are of
public dominion.
After several motions for extension of time, 13 PEA and AMARI filed their
Comments on October 19, 1998 and June 25, 1998, respectively.
Meanwhile, on December 28, 1998, petitioner filed an Omnibus Motion:
(a) to require PEA to submit the terms of the renegotiated PEA-AMARI
contract; (b) for issuance of a temporary restraining order; and (c) to set
the case for hearing on oral argument. Petitioner filed a Reiterative
Motion for Issuance of a TRO dated May 26, 1999, which the Court
denied in a Resolution dated June 22, 1999.
In a Resolution dated March 23, 1999, the Court gave due course to
the petition and required the parties to file their respective memoranda.
On March 30, 1999, PEA and AMARI signed the Amended Joint
Venture Agreement ("Amended JVA," for brevity). On May 28, 1999,
the Office of the President under the administration of then President
Joseph E. Estrada approved the Amended JVA.
Due to the approval of the Amended JVA by the Office of the President,
petitioner now prays that on "constitutional and statutory grounds the
renegotiated contract be declared null and void."14
The Issues
The issues raised by petitioner, PEA15 and AMARI16 are as follows:
I. WHETHER THE PRINCIPAL RELIEFS PRAYED FOR IN
THE PETITION ARE MOOT AND ACADEMIC BECAUSE OF
SUBSEQUENT EVENTS;
II. WHETHER THE PETITION MERITS DISMISSAL FOR
FAILING TO OBSERVE THE PRINCIPLE GOVERNING THE
HIERARCHY OF COURTS;
III. WHETHER THE PETITION MERITS DISMISSAL FOR
NON-EXHAUSTION OF ADMINISTRATIVE REMEDIES;
IV. WHETHER PETITIONER HAS LOCUS STANDI TO
BRING THIS SUIT;
V. WHETHER THE CONSTITUTIONAL RIGHT TO
INFORMATION INCLUDES OFFICIAL INFORMATION ON
ON-GOING NEGOTIATIONS BEFORE A FINAL
AGREEMENT;
VI. WHETHER THE STIPULATIONS IN THE AMENDED
JOINT VENTURE AGREEMENT FOR THE TRANSFER TO
AMARI OF CERTAIN LANDS, RECLAIMED AND STILL TO
BE RECLAIMED, VIOLATE THE 1987 CONSTITUTION; AND
VII. WHETHER THE COURT IS THE PROPER FORUM FOR
RAISING THE ISSUE OF WHETHER THE AMENDED JOINT
 VENTURE AGREEMENT IS GROSSLY
DISADVANTAGEOUS TO THE GOVERNMENT.
The Court's Ruling
First issue: whether the principal reliefs prayed for in the petition
are moot and academic because of subsequent events.
The petition prays that PEA publicly disclose the "terms and conditions
of the on-going negotiations for a new agreement." The petition also
prays that the Court enjoin PEA from "privately entering into, perfecting
and/or executing any new agreement with AMARI."
PEA and AMARI claim the petition is now moot and academic because
AMARI furnished petitioner on June 21, 1999 a copy of the signed
Amended JVA containing the terms and conditions agreed upon in the
renegotiations. Thus, PEA has satisfied petitioner's prayer for a public
disclosure of the renegotiations. Likewise, petitioner's prayer to enjoin
the signing of the Amended JVA is now moot because PEA and AMARI
have already signed the Amended JVA on March 30, 1999. Moreover,
the Office of the President has approved the Amended JVA on May 28,
1999.
Petitioner counters that PEA and AMARI cannot avoid the constitutional
issue by simply fast-tracking the signing and approval of the Amended
JVA before the Court could act on the issue. Presidential approval does
not resolve the constitutional issue or remove it from the ambit of
judicial review.
We rule that the signing of the Amended JVA by PEA and AMARI and
its approval by the President cannot operate to moot the petition and
divest the Court of its jurisdiction. PEA and AMARI have still to
implement the Amended JVA. The prayer to enjoin the signing of the
Amended JVA on constitutional grounds necessarily includes
preventing its implementation if in the meantime PEA and AMARI have
signed one in violation of the Constitution. Petitioner's principal basis in
assailing the renegotiation of the JVA is its violation of Section 3, Article
XII of the Constitution, which prohibits the government from alienating
lands of the public domain to private corporations. If the Amended JVA
indeed violates the Constitution, it is the duty of the Court to enjoin its
implementation, and if already implemented, to annul the effects of
such unconstitutional contract.
The Amended JVA is not an ordinary commercial contract but one
which seeks to transfer title and ownership to 367.5 hectares of
reclaimed lands and submerged areas of Manila Bay to a single
private corporation. It now becomes more compelling for the Court to
resolve the issue to insure the government itself does not violate a
provision of the Constitution intended to safeguard the national
patrimony. Supervening events, whether intended or accidental, cannot
prevent the Court from rendering a decision if there is a grave violation
of the Constitution. In the instant case, if the Amended JVA runs
counter to the Constitution, the Court can still prevent the transfer of
title and ownership of alienable lands of the public domain in the name
of AMARI. Even in cases where supervening events had made the
cases moot, the Court did not hesitate to resolve the legal or
constitutional issues raised to formulate controlling principles to guide
the bench, bar, and the public.17
Also, the instant petition is a case of first impression. All previous
decisions of the Court involving Section 3, Article XII of the 1987
Constitution, or its counterpart provision in the 1973 Constitution, 18
covered agricultural lands sold to private corporations which acquired
the lands from private parties. The transferors of the private
corporations claimed or could claim the right to judicial confirmation
of their imperfect titles19 under Title II of Commonwealth Act. 141
("CA No. 141" for brevity). In the instant case, AMARI seeks to acquire
from PEA, a public corporation, reclaimed lands and submerged areas
for non-agricultural purposes by purchase under PD No. 1084
(charter of PEA) and Title III of CA No. 141. Certain undertakings by
AMARI under the Amended JVA constitute the consideration for the
purchase. Neither AMARI nor PEA can claim judicial confirmation of
their titles because the lands covered by the Amended JVA are newly
reclaimed or still to be reclaimed. Judicial confirmation of imperfect title
requires open, continuous, exclusive and notorious occupation of
agricultural lands of the public domain for at least thirty years since
June 12, 1945 or earlier. Besides, the deadline for filing applications for
judicial confirmation of imperfect title expired on December 31, 1987. 20
Lastly, there is a need to resolve immediately the constitutional issue
raised in this petition because of the possible transfer at any time by
PEA to AMARI of title and ownership to portions of the reclaimed lands.
Under the Amended JVA, PEA is obligated to transfer to AMARI the
latter's seventy percent proportionate share in the reclaimed areas as
the reclamation progresses. The Amended JVA even allows AMARI to
mortgage at any time the entire reclaimed area to raise financing for
the reclamation project.21
Second issue: whether the petition merits dismissal for failing to
observe the principle governing the hierarchy of courts.
PEA and AMARI claim petitioner ignored the judicial hierarchy by
seeking relief directly from the Court. The principle of hierarchy of
courts applies generally to cases involving factual questions. As it is not
a trier of facts, the Court cannot entertain cases involving factual
issues. The instant case, however, raises constitutional issues of
transcendental importance to the public. 22 The Court can resolve this
case without determining any factual issue related to the case. Also, the
instant case is a petition for mandamus which falls under the original
jurisdiction of the Court under Section 5, Article VIII of the Constitution.
We resolve to exercise primary jurisdiction over the instant case.
Third issue: whether the petition merits dismissal for non-
exhaustion of administrative remedies.
PEA faults petitioner for seeking judicial intervention in compelling PEA
to disclose publicly certain information without first asking PEA the
needed information. PEA claims petitioner's direct resort to the Court
violates the principle of exhaustion of administrative remedies. It also
violates the rule that mandamus may issue only if there is no other
plain, speedy and adequate remedy in the ordinary course of law.
PEA distinguishes the instant case from Tañada v. Tuvera 23 where the
Court granted the petition for mandamus even if the petitioners there
did not initially demand from the Office of the President the publication
of the presidential decrees. PEA points out that in Tañada, the
Executive Department had an affirmative statutory duty under Article
2 of the Civil Code 24 and Section 1 of Commonwealth Act No. 638 25 to
publish the presidential decrees. There was, therefore, no need for the
petitioners in Tañada to make an initial demand from the Office of the
President. In the instant case, PEA claims it has no affirmative statutory
duty to disclose publicly information about its renegotiation of the JVA.
Thus, PEA asserts that the Court must apply the principle of exhaustion
of administrative remedies to the instant case in view of the failure of
petitioner here to demand initially from PEA the needed information.
The original JVA sought to dispose to AMARI public lands held by PEA,
a government corporation. Under Section 79 of the Government
Auditing Code,26 the disposition of government lands to private parties
requires public bidding. PEA was under a positive legal duty to
disclose to the public the terms and conditions for the sale of its
lands. The law obligated PEA to make this public disclosure even
without demand from petitioner or from anyone. PEA failed to make this
public disclosure because the original JVA, like the Amended JVA, was
the result of a negotiated contract, not of a public bidding.
Considering that PEA had an affirmative statutory duty to make the
public disclosure, and was even in breach of this legal duty, petitioner
had the right to seek direct judicial intervention.
Moreover, and this alone is determinative of this issue, the principle of
exhaustion of administrative remedies does not apply when the issue
involved is a purely legal or constitutional question. 27 The principal issue
in the instant case is the capacity of AMARI to acquire lands held by
PEA in view of the constitutional ban prohibiting the alienation of lands
of the public domain to private corporations. We rule that the principle
of exhaustion of administrative remedies does not apply in the instant
case.
Fourth issue: whether petitioner has locus standi to bring this suit
PEA argues that petitioner has no standing to institute mandamus
proceedings to enforce his constitutional right to information without a
showing that PEA refused to perform an affirmative duty imposed on
PEA by the Constitution. PEA also claims that petitioner has not shown
that he will suffer any concrete injury because of the signing or
implementation of the Amended JVA. Thus, there is no actual
controversy requiring the exercise of the power of judicial review.
The petitioner has standing to bring this taxpayer's suit because the
petition seeks to compel PEA to comply with its constitutional duties.
There are two constitutional issues involved here. First is the right of
citizens to information on matters of public concern. Second is the
application of a constitutional provision intended to insure the equitable
distribution of alienable lands of the public domain among Filipino
citizens. The thrust of the first issue is to compel PEA to disclose
publicly information on the sale of government lands worth billions of
pesos, information which the Constitution and statutory law mandate
PEA to disclose. The thrust of the second issue is to prevent PEA from
alienating hundreds of hectares of alienable lands of the public domain
in violation of the Constitution, compelling PEA to comply with a
constitutional duty to the nation.
Moreover, the petition raises matters of transcendental importance to
the public. In Chavez v. PCGG,28 the Court upheld the right of a citizen
to bring a taxpayer's suit on matters of transcendental importance to the
public, thus -
"Besides, petitioner emphasizes, the matter of recovering the
ill-gotten wealth of the Marcoses is an issue of 'transcendental
importance to the public.' He asserts that ordinary taxpayers
have a right to initiate and prosecute actions questioning the
validity of acts or orders of government agencies or
instrumentalities, if the issues raised are of 'paramount public
interest,' and if they 'immediately affect the social, economic
and moral well being of the people.'
Moreover, the mere fact that he is a citizen satisfies the
requirement of personal interest, when the proceeding
involves the assertion of a public right, such as in this case.
He invokes several decisions of this Court which have set
 aside the procedural matter of locus standi, when the subject
of the case involved public interest.
xxx
In Tañada v. Tuvera, the Court asserted that when the issue
concerns a public right and the object of mandamus is to
obtain the enforcement of a public duty, the people are
regarded as the real parties in interest; and because it is
sufficient that petitioner is a citizen and as such is interested
in the execution of the laws, he need not show that he has
any legal or special interest in the result of the action. In the
aforesaid case, the petitioners sought to enforce their right to
be informed on matters of public concern, a right then
recognized in Section 6, Article IV of the 1973 Constitution, in
connection with the rule that laws in order to be valid and
enforceable must be published in the Official Gazette or
otherwise effectively promulgated. In ruling for the petitioners'
legal standing, the Court declared that the right they sought to
be enforced 'is a public right recognized by no less than the
fundamental law of the land.'
Legaspi v. Civil Service Commission, while reiterating
Tañada, further declared that 'when a mandamus proceeding
involves the assertion of a public right, the requirement of
personal interest is satisfied by the mere fact that petitioner is
a citizen and, therefore, part of the general 'public' which
possesses the right.'
Further, in Albano v. Reyes, we said that while expenditure of
public funds may not have been involved under the
questioned contract for the development, management and
operation of the Manila International Container Terminal,
'public interest [was] definitely involved considering the
important role [of the subject contract] . . . in the economic
development of the country and the magnitude of the financial
consideration involved.' We concluded that, as a
consequence, the disclosure provision in the Constitution
would constitute sufficient authority for upholding the
petitioner's standing.
Similarly, the instant petition is anchored on the right of the
people to information and access to official records,
documents and papers — a right guaranteed under Section 7,
Article III of the 1987 Constitution. Petitioner, a former solicitor
general, is a Filipino citizen. Because of the satisfaction of the
two basic requisites laid down by decisional law to sustain
petitioner's legal standing, i.e. (1) the enforcement of a public
right (2) espoused by a Filipino citizen, we rule that the
petition at bar should be allowed."
We rule that since the instant petition, brought by a citizen, involves the
enforcement of constitutional rights - to information and to the equitable
diffusion of natural resources - matters of transcendental public
importance, the petitioner has the requisite locus standi.
Fifth issue: whether the constitutional right to information
includes official information on on-going negotiations before a
final agreement.
Section 7, Article III of the Constitution explains the people's right to
information on matters of public concern in this manner:
"Sec. 7. The right of the people to information on matters of
public concern shall be recognized. Access to official
records, and to documents, and papers pertaining to
official acts, transactions, or decisions, as well as to
government research data used as basis for policy
development, shall be afforded the citizen, subject to such
limitations as may be provided by law." (Emphasis supplied)
The State policy of full transparency in all transactions involving public
interest reinforces the people's right to information on matters of public
concern. This State policy is expressed in Section 28, Article II of the
Constitution, thus:
"Sec. 28. Subject to reasonable conditions prescribed by law,
the State adopts and implements a policy of full public
disclosure of all its transactions involving public
interest." (Emphasis supplied)
These twin provisions of the Constitution seek to promote transparency
in policy-making and in the operations of the government, as well as
provide the people sufficient information to exercise effectively other
constitutional rights. These twin provisions are essential to the exercise
of freedom of expression. If the government does not disclose its official
acts, transactions and decisions to citizens, whatever citizens say, even
if expressed without any restraint, will be speculative and amount to
nothing. These twin provisions are also essential to hold public officials
"at all times x x x accountable to the people," 29 for unless citizens have
the proper information, they cannot hold public officials accountable for
anything. Armed with the right information, citizens can participate in
public discussions leading to the formulation of government policies
and their effective implementation. An informed citizenry is essential to
the existence and proper functioning of any democracy. As explained
by the Court in Valmonte v. Belmonte, Jr.30 –
"An essential element of these freedoms is to keep open a
continuing dialogue or process of communication between the
government and the people. It is in the interest of the State
that the channels for free political discussion be maintained to
the end that the government may perceive and be responsive
to the people's will. Yet, this open dialogue can be effective
only to the extent that the citizenry is informed and thus able
to formulate its will intelligently. Only when the participants in
the discussion are aware of the issues and have access to
information relating thereto can such bear fruit."
PEA asserts, citing Chavez v. PCGG,31 that in cases of on-going
negotiations the right to information is limited to "definite propositions of
the government." PEA maintains the right does not include access to
"intra-agency or inter-agency recommendations or communications
during the stage when common assertions are still in the process of
being formulated or are in the 'exploratory stage'."
Also, AMARI contends that petitioner cannot invoke the right at the pre-
decisional stage or before the closing of the transaction. To support its
contention, AMARI cites the following discussion in the 1986
Constitutional Commission:
"Mr. Suarez. And when we say 'transactions' which should be
distinguished from contracts, agreements, or treaties or
whatever, does the Gentleman refer to the steps leading to
the consummation of the contract, or does he refer to the
contract itself?
Mr. Ople: The 'transactions' used here, I suppose is
generic and therefore, it can cover both steps leading to
a contract and already a consummated contract, Mr.
Presiding Officer.
Mr. Suarez: This contemplates inclusion of negotiations
leading to the consummation of the transaction.
Mr. Ople: Yes, subject only to reasonable safeguards on
the national interest.
Mr. Suarez: Thank you."32 (Emphasis supplied)
AMARI argues there must first be a consummated contract before
petitioner can invoke the right. Requiring government officials to reveal
their deliberations at the pre-decisional stage will degrade the quality of
decision-making in government agencies. Government officials will
hesitate to express their real sentiments during deliberations if there is
immediate public dissemination of their discussions, putting them under
all kinds of pressure before they decide.
We must first distinguish between information the law on public bidding
requires PEA to disclose publicly, and information the constitutional
right to information requires PEA to release to the public. Before the
consummation of the contract, PEA must, on its own and without
demand from anyone, disclose to the public matters relating to the
disposition of its property. These include the size, location, technical
description and nature of the property being disposed of, the terms and
conditions of the disposition, the parties qualified to bid, the minimum
price and similar information. PEA must prepare all these data and
disclose them to the public at the start of the disposition process, long
before the consummation of the contract, because the Government
Auditing Code requires public bidding. If PEA fails to make this
disclosure, any citizen can demand from PEA this information at any
time during the bidding process.
Information, however, on on-going evaluation or review of bids or
proposals being undertaken by the bidding or review committee is not
immediately accessible under the right to information. While the
evaluation or review is still on-going, there are no "official acts,
transactions, or decisions" on the bids or proposals. However, once the
committee makes its official recommendation, there arises a
"definite proposition" on the part of the government. From this
moment, the public's right to information attaches, and any citizen can
access all the non-proprietary information leading to such definite
proposition. In Chavez v. PCGG,33 the Court ruled as follows:
"Considering the intent of the framers of the Constitution, we
believe that it is incumbent upon the PCGG and its officers, as
well as other government representatives, to disclose
sufficient public information on any proposed settlement they
have decided to take up with the ostensible owners and
holders of ill-gotten wealth. Such information, though, must
pertain to definite propositions of the government, not
necessarily to intra-agency or inter-agency recommendations
or communications during the stage when common assertions
are still in the process of being formulated or are in the
"exploratory" stage. There is need, of course, to observe the
same restrictions on disclosure of information in general, as
discussed earlier – such as on matters involving national
security, diplomatic or foreign relations, intelligence and other
classified information." (Emphasis supplied)
Contrary to AMARI's contention, the commissioners of the 1986
Constitutional Commission understood that the right to information
"contemplates inclusion of negotiations leading to the
consummation of the transaction." Certainly, a consummated
contract is not a requirement for the exercise of the right to information.
Otherwise, the people can never exercise the right if no contract is
consummated, and if one is consummated, it may be too late for the
public to expose its defects.1âwphi1.nêt
Requiring a consummated contract will keep the public in the dark until
the contract, which may be grossly disadvantageous to the government
or even illegal, becomes a fait accompli. This negates the State policy
of full transparency on matters of public concern, a situation which the
framers of the Constitution could not have intended. Such a
requirement will prevent the citizenry from participating in the public
discussion of any proposed contract, effectively truncating a basic right
enshrined in the Bill of Rights. We can allow neither an emasculation of
a constitutional right, nor a retreat by the State of its avowed "policy of
full disclosure of all its transactions involving public interest."
The right covers three categories of information which are "matters of
public concern," namely: (1) official records; (2) documents and papers
pertaining to official acts, transactions and decisions; and (3)
government research data used in formulating policies. The first
category refers to any document that is part of the public records in the
custody of government agencies or officials. The second category
refers to documents and papers recording, evidencing, establishing,
confirming, supporting, justifying or explaining official acts, transactions
or decisions of government agencies or officials. The third category
refers to research data, whether raw, collated or processed, owned by
the government and used in formulating government policies.
The information that petitioner may access on the renegotiation of the
JVA includes evaluation reports, recommendations, legal and expert
opinions, minutes of meetings, terms of reference and other documents
attached to such reports or minutes, all relating to the JVA. However,
the right to information does not compel PEA to prepare lists, abstracts,
summaries and the like relating to the renegotiation of the JVA. 34 The
right only affords access to records, documents and papers, which
means the opportunity to inspect and copy them. One who exercises
the right must copy the records, documents and papers at his expense.
The exercise of the right is also subject to reasonable regulations to
protect the integrity of the public records and to minimize disruption to
government operations, like rules specifying when and how to conduct
the inspection and copying.35
The right to information, however, does not extend to matters
recognized as privileged information under the separation of powers. 36
The right does not also apply to information on military and diplomatic
secrets, information affecting national security, and information on
investigations of crimes by law enforcement agencies before the
prosecution of the accused, which courts have long recognized as
confidential.37 The right may also be subject to other limitations that
Congress may impose by law.
There is no claim by PEA that the information demanded by petitioner
is privileged information rooted in the separation of powers. The
information does not cover Presidential conversations,
correspondences, or discussions during closed-door Cabinet meetings
which, like internal deliberations of the Supreme Court and other
collegiate courts, or executive sessions of either house of Congress, 38
are recognized as confidential. This kind of information cannot be pried
open by a co-equal branch of government. A frank exchange of
exploratory ideas and assessments, free from the glare of publicity and
pressure by interested parties, is essential to protect the independence
of decision-making of those tasked to exercise Presidential, Legislative
and Judicial power.39 This is not the situation in the instant case.
We rule, therefore, that the constitutional right to information includes
official information on on-going negotiations before a final contract.
The information, however, must constitute definite propositions by the
government and should not cover recognized exceptions like privileged
information, military and diplomatic secrets and similar matters affecting
national security and public order.40 Congress has also prescribed other
limitations on the right to information in several legislations. 41
Sixth issue: whether stipulations in the Amended JVA for the
transfer to AMARI of lands, reclaimed or to be reclaimed, violate
the Constitution.
The Regalian Doctrine
The ownership of lands reclaimed from foreshore and submerged areas
is rooted in the Regalian doctrine which holds that the State owns all
lands and waters of the public domain. Upon the Spanish conquest of
the Philippines, ownership of all "lands, territories and possessions" in
the Philippines passed to the Spanish Crown. 42 The King, as the
sovereign ruler and representative of the people, acquired and owned
all lands and territories in the Philippines except those he disposed of
by grant or sale to private individuals.
The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine
substituting, however, the State, in lieu of the King, as the owner of all
lands and waters of the public domain. The Regalian doctrine is the
foundation of the time-honored principle of land ownership that "all
lands that were not acquired from the Government, either by purchase
or by grant, belong to the public domain." 43 Article 339 of the Civil Code
of 1889, which is now Article 420 of the Civil Code of 1950,
incorporated the Regalian doctrine.
Ownership and Disposition of Reclaimed Lands
The Spanish Law of Waters of 1866 was the first statutory law
governing the ownership and disposition of reclaimed lands in the
Philippines. On May 18, 1907, the Philippine Commission enacted Act
No. 1654 which provided for the lease, but not the sale, of reclaimed
lands of the government to corporations and individuals. Later, on
November 29, 1919, the Philippine Legislature approved Act No. 2874,
the Public Land Act, which authorized the lease, but not the sale, of
reclaimed lands of the government to corporations and
individuals. On November 7, 1936, the National Assembly passed
Commonwealth Act No. 141, also known as the Public Land Act, which
authorized the lease, but not the sale, of reclaimed lands of the
government to corporations and individuals. CA No. 141 continues
to this day as the general law governing the classification and
disposition of lands of the public domain.
The Spanish Law of Waters of 1866 and the Civil Code of 1889
Under the Spanish Law of Waters of 1866, the shores, bays, coves,
inlets and all waters within the maritime zone of the Spanish territory
belonged to the public domain for public use. 44 The Spanish Law of
Waters of 1866 allowed the reclamation of the sea under Article 5,
which provided as follows:
"Article 5. Lands reclaimed from the sea in consequence of
works constructed by the State, or by the provinces, pueblos
or private persons, with proper permission, shall become the
property of the party constructing such works, unless
otherwise provided by the terms of the grant of authority."
Under the Spanish Law of Waters, land reclaimed from the sea
belonged to the party undertaking the reclamation, provided the
government issued the necessary permit and did not reserve ownership
of the reclaimed land to the State.
Article 339 of the Civil Code of 1889 defined property of public
dominion as follows:
"Art. 339. Property of public dominion is –
1. That devoted to public use, such as roads, canals, rivers,
torrents, ports and bridges constructed by the State,
riverbanks, shores, roadsteads, and that of a similar
character;
2. That belonging exclusively to the State which, without being
of general public use, is employed in some public service, or
in the development of the national wealth, such as walls,
fortresses, and other works for the defense of the territory,
and mines, until granted to private individuals."
Property devoted to public use referred to property open for use by the
public. In contrast, property devoted to public service referred to
property used for some specific public service and open only to those
authorized to use the property.
Property of public dominion referred not only to property devoted to
public use, but also to property not so used but employed to develop
the national wealth. This class of property constituted property of
public dominion although employed for some economic or commercial
activity to increase the national wealth.
Article 341 of the Civil Code of 1889 governed the re-classification of
property of public dominion into private property, to wit:
"Art. 341. Property of public dominion, when no longer
devoted to public use or to the defense of the territory, shall
become a part of the private property of the State."
This provision, however, was not self-executing. The legislature, or the
executive department pursuant to law, must declare the property no
longer needed for public use or territorial defense before the
government could lease or alienate the property to private parties.45
Act No. 1654 of the Philippine Commission
On May 8, 1907, the Philippine Commission enacted Act No. 1654
which regulated the lease of reclaimed and foreshore lands. The salient
provisions of this law were as follows:
"Section 1. The control and disposition of the foreshore as
defined in existing law, and the title to all Government or
public lands made or reclaimed by the Government by
dredging or filling or otherwise throughout the Philippine
Islands, shall be retained by the Government without
prejudice to vested rights and without prejudice to rights
conceded to the City of Manila in the Luneta Extension.
Section 2. (a) The Secretary of the Interior shall cause all
Government or public lands made or reclaimed by the
Government by dredging or filling or otherwise to be divided
into lots or blocks, with the necessary streets and alleyways
located thereon, and shall cause plats and plans of such
surveys to be prepared and filed with the Bureau of Lands.
(b) Upon completion of such plats and plans the Governor-
General shall give notice to the public that such parts of
the lands so made or reclaimed as are not needed for
public purposes will be leased for commercial and
business purposes, x x x.
 xxx
(e) The leases above provided for shall be disposed of to
the highest and best bidder therefore, subject to such
regulations and safeguards as the Governor-General may by
executive order prescribe." (Emphasis supplied)
Act No. 1654 mandated that the government should retain title to all
lands reclaimed by the government. The Act also vested in the
government control and disposition of foreshore lands. Private parties
could lease lands reclaimed by the government only if these lands were
no longer needed for public purpose. Act No. 1654 mandated public
bidding in the lease of government reclaimed lands. Act No. 1654
made government reclaimed lands sui generis in that unlike other
public lands which the government could sell to private parties, these
reclaimed lands were available only for lease to private parties.
Act No. 1654, however, did not repeal Section 5 of the Spanish Law of
Waters of 1866. Act No. 1654 did not prohibit private parties from
reclaiming parts of the sea under Section 5 of the Spanish Law of
Waters. Lands reclaimed from the sea by private parties with
government permission remained private lands.
Act No. 2874 of the Philippine Legislature
On November 29, 1919, the Philippine Legislature enacted Act No.
2874, the Public Land Act.46 The salient provisions of Act No. 2874, on
reclaimed lands, were as follows:
"Sec. 6. The Governor-General, upon the
recommendation of the Secretary of Agriculture and
Natural Resources, shall from time to time classify the
lands of the public domain into –
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands, x x x.
Sec. 7. For the purposes of the government and disposition of
alienable or disposable public lands, the Governor-General,
upon recommendation by the Secretary of Agriculture
and Natural Resources, shall from time to time declare
what lands are open to disposition or concession under
this Act."
Sec. 8. Only those lands shall be declared open to
disposition or concession which have been officially
delimited or classified x x x.
xxx
Sec. 55. Any tract of land of the public domain which, being
neither timber nor mineral land, shall be classified as suitable
for residential purposes or for commercial, industrial, or
other productive purposes other than agricultural
purposes, and shall be open to disposition or concession,
shall be disposed of under the provisions of this chapter, and
not otherwise.
Sec. 56. The lands disposable under this title shall be
classified as follows:
(a) Lands reclaimed by the Government by
dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water
bordering upon the shores or banks of navigable
lakes or rivers;
(d) Lands not included in any of the foregoing
classes.
x x x.
Sec. 58. The lands comprised in classes (a), (b), and (c) of
section fifty-six shall be disposed of to private parties by
lease only and not otherwise, as soon as the Governor-
General, upon recommendation by the Secretary of
Agriculture and Natural Resources, shall declare that the
same are not necessary for the public service and are
open to disposition under this chapter. The lands included
in class (d) may be disposed of by sale or lease under the
provisions of this Act." (Emphasis supplied)
Section 6 of Act No. 2874 authorized the Governor-General to "classify
lands of the public domain into x x x alienable or disposable" 47 lands.
Section 7 of the Act empowered the Governor-General to "declare what
lands are open to disposition or concession." Section 8 of the Act
limited alienable or disposable lands only to those lands which have
been "officially delimited and classified."
Section 56 of Act No. 2874 stated that lands "disposable under this
title48 shall be classified" as government reclaimed, foreshore and
marshy lands, as well as other lands. All these lands, however, must be
suitable for residential, commercial, industrial or other productive non-
agricultural purposes. These provisions vested upon the Governor-
General the power to classify inalienable lands of the public domain into
disposable lands of the public domain. These provisions also
empowered the Governor-General to classify further such disposable
lands of the public domain into government reclaimed, foreshore or
marshy lands of the public domain, as well as other non-agricultural
lands.
Section 58 of Act No. 2874 categorically mandated that disposable
lands of the public domain classified as government reclaimed,
foreshore and marshy lands "shall be disposed of to private parties
by lease only and not otherwise." The Governor-General, before
allowing the lease of these lands to private parties, must formally
declare that the lands were "not necessary for the public service." Act
No. 2874 reiterated the State policy to lease and not to sell government
reclaimed, foreshore and marshy lands of the public domain, a policy
first enunciated in 1907 in Act No. 1654. Government reclaimed,
foreshore and marshy lands remained sui generis, as the only
alienable or disposable lands of the public domain that the government
could not sell to private parties.
The rationale behind this State policy is obvious. Government
reclaimed, foreshore and marshy public lands for non-agricultural
purposes retain their inherent potential as areas for public service. This
is the reason the government prohibited the sale, and only allowed the
lease, of these lands to private parties. The State always reserved
these lands for some future public service.
Act No. 2874 did not authorize the reclassification of government
reclaimed, foreshore and marshy lands into other non-agricultural lands
under Section 56 (d). Lands falling under Section 56 (d) were the only
lands for non-agricultural purposes the government could sell to private
parties. Thus, under Act No. 2874, the government could not sell
government reclaimed, foreshore and marshy lands to private parties,
unless the legislature passed a law allowing their sale.49
Act No. 2874 did not prohibit private parties from reclaiming parts of the
sea pursuant to Section 5 of the Spanish Law of Waters of 1866. Lands
reclaimed from the sea by private parties with government permission
remained private lands.
Dispositions under the 1935 Constitution
On May 14, 1935, the 1935 Constitution took effect upon its ratification
by the Filipino people. The 1935 Constitution, in adopting the Regalian
doctrine, declared in Section 1, Article XIII, that –
"Section 1. All agricultural, timber, and mineral lands of the
public domain, waters, minerals, coal, petroleum, and other
mineral oils, all forces of potential energy and other natural
resources of the Philippines belong to the State, and their
disposition, exploitation, development, or utilization shall be
limited to citizens of the Philippines or to corporations or
associations at least sixty per centum of the capital of which is
owned by such citizens, subject to any existing right, grant,
lease, or concession at the time of the inauguration of the
Government established under this Constitution. Natural
resources, with the exception of public agricultural land,
shall not be alienated, and no license, concession, or lease
for the exploitation, development, or utilization of any of the
natural resources shall be granted for a period exceeding
twenty-five years, renewable for another twenty-five years,
except as to water rights for irrigation, water supply, fisheries,
or industrial uses other than the development of water power,
in which cases beneficial use may be the measure and limit of
the grant." (Emphasis supplied)
The 1935 Constitution barred the alienation of all natural resources
except public agricultural lands, which were the only natural resources
the State could alienate. Thus, foreshore lands, considered part of the
State's natural resources, became inalienable by constitutional fiat,
available only for lease for 25 years, renewable for another 25 years.
The government could alienate foreshore lands only after these lands
were reclaimed and classified as alienable agricultural lands of the
public domain. Government reclaimed and marshy lands of the public
domain, being neither timber nor mineral lands, fell under the
classification of public agricultural lands.50 However, government
reclaimed and marshy lands, although subject to classification as
disposable public agricultural lands, could only be leased and not sold
to private parties because of Act No. 2874.
The prohibition on private parties from acquiring ownership of
government reclaimed and marshy lands of the public domain was only
a statutory prohibition and the legislature could therefore remove such
prohibition. The 1935 Constitution did not prohibit individuals and
corporations from acquiring government reclaimed and marshy lands of
the public domain that were classified as agricultural lands under
existing public land laws. Section 2, Article XIII of the 1935 Constitution
provided as follows:
"Section 2. No private corporation or association may
acquire, lease, or hold public agricultural lands in excess
of one thousand and twenty four hectares, nor may any
individual acquire such lands by purchase in excess of
one hundred and forty hectares, or by lease in excess of
one thousand and twenty-four hectares, or by homestead
in excess of twenty-four hectares. Lands adapted to grazing,
not exceeding two thousand hectares, may be leased to an
individual, private corporation, or association." (Emphasis
supplied)
Still, after the effectivity of the 1935 Constitution, the legislature did not
repeal Section 58 of Act No. 2874 to open for sale to private parties
government reclaimed and marshy lands of the public domain. On the
contrary, the legislature continued the long established State policy of
retaining for the government title and ownership of government
reclaimed and marshy lands of the public domain.
Commonwealth Act No. 141 of the Philippine National Assembly
On November 7, 1936, the National Assembly approved
Commonwealth Act No. 141, also known as the Public Land Act, which
compiled the then existing laws on lands of the public domain. CA No.
141, as amended, remains to this day the existing general law
governing the classification and disposition of lands of the public
domain other than timber and mineral lands.51
Section 6 of CA No. 141 empowers the President to classify lands of
the public domain into "alienable or disposable" 52 lands of the public
domain, which prior to such classification are inalienable and outside
the commerce of man. Section 7 of CA No. 141 authorizes the
President to "declare what lands are open to disposition or concession."
Section 8 of CA No. 141 states that the government can declare open
for disposition or concession only lands that are "officially delimited and
classified." Sections 6, 7 and 8 of CA No. 141 read as follows:
"Sec. 6. The President, upon the recommendation of the
Secretary of Agriculture and Commerce, shall from time
to time classify the lands of the public domain into –
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands,
and may at any time and in like manner transfer such lands
from one class to another, 53 for the purpose of their
administration and disposition.
Sec. 7. For the purposes of the administration and disposition
of alienable or disposable public lands, the President, upon
recommendation by the Secretary of Agriculture and
Commerce, shall from time to time declare what lands are
open to disposition or concession under this Act.
Sec. 8. Only those lands shall be declared open to
disposition or concession which have been officially
delimited and classified and, when practicable, surveyed,
and which have not been reserved for public or quasi-
public uses, nor appropriated by the Government, nor in any
manner become private property, nor those on which a private
right authorized and recognized by this Act or any other valid
law may be claimed, or which, having been reserved or
appropriated, have ceased to be so. x x x."
Thus, before the government could alienate or dispose of lands of the
public domain, the President must first officially classify these lands as
alienable or disposable, and then declare them open to disposition or
concession. There must be no law reserving these lands for public or
quasi-public uses.
The salient provisions of CA No. 141, on government reclaimed,
foreshore and marshy lands of the public domain, are as follows:
"Sec. 58. Any tract of land of the public domain which,
being neither timber nor mineral land, is intended to be
used for residential purposes or for commercial,
industrial, or other productive purposes other than
agricultural, and is open to disposition or concession,
shall be disposed of under the provisions of this chapter
and not otherwise.
Sec. 59. The lands disposable under this title shall be
classified as follows:
(a) Lands reclaimed by the Government by
dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water
bordering upon the shores or banks of navigable
lakes or rivers;
(d) Lands not included in any of the foregoing
classes.
Sec. 60. Any tract of land comprised under this title may be
leased or sold, as the case may be, to any person,
corporation, or association authorized to purchase or lease
public lands for agricultural purposes. x x x.
Sec. 61. The lands comprised in classes (a), (b), and (c) of
section fifty-nine shall be disposed of to private parties
by lease only and not otherwise, as soon as the President,
upon recommendation by the Secretary of Agriculture, shall
declare that the same are not necessary for the public
service and are open to disposition under this chapter. The
lands included in class (d) may be disposed of by sale or
lease under the provisions of this Act." (Emphasis
supplied)
Section 61 of CA No. 141 readopted, after the effectivity of the 1935
Constitution, Section 58 of Act No. 2874 prohibiting the sale of
government reclaimed, foreshore and marshy disposable lands of the
public domain. All these lands are intended for residential, commercial,
industrial or other non-agricultural purposes. As before, Section 61
allowed only the lease of such lands to private parties. The government
could sell to private parties only lands falling under Section 59 (d) of CA
No. 141, or those lands for non-agricultural purposes not classified as
government reclaimed, foreshore and marshy disposable lands of the
public domain. Foreshore lands, however, became inalienable under
the 1935 Constitution which only allowed the lease of these lands to
qualified private parties.
Section 58 of CA No. 141 expressly states that disposable lands of the
public domain intended for residential, commercial, industrial or other
productive purposes other than agricultural "shall be disposed of
under the provisions of this chapter and not otherwise." Under
Section 10 of CA No. 141, the term "disposition" includes lease of the
land. Any disposition of government reclaimed, foreshore and marshy
disposable lands for non-agricultural purposes must comply with
Chapter IX, Title III of CA No. 141, 54 unless a subsequent law amended
or repealed these provisions.
In his concurring opinion in the landmark case of Republic Real Estate
Corporation v. Court of Appeals,55 Justice Reynato S. Puno
summarized succinctly the law on this matter, as follows:
"Foreshore lands are lands of public dominion intended for
public use. So too are lands reclaimed by the government by
dredging, filling, or other means. Act 1654 mandated that the
control and disposition of the foreshore and lands under water
remained in the national government. Said law allowed only
the 'leasing' of reclaimed land. The Public Land Acts of 1919
and 1936 also declared that the foreshore and lands
reclaimed by the government were to be "disposed of to
private parties by lease only and not otherwise." Before
leasing, however, the Governor-General, upon
recommendation of the Secretary of Agriculture and Natural
Resources, had first to determine that the land reclaimed was
not necessary for the public service. This requisite must have
been met before the land could be disposed of. But even
then, the foreshore and lands under water were not to be
alienated and sold to private parties. The disposition of
the reclaimed land was only by lease. The land remained
property of the State." (Emphasis supplied)
As observed by Justice Puno in his concurring opinion,
"Commonwealth Act No. 141 has remained in effect at present."
The State policy prohibiting the sale to private parties of government
reclaimed, foreshore and marshy alienable lands of the public domain,
first implemented in 1907 was thus reaffirmed in CA No. 141 after the
1935 Constitution took effect. The prohibition on the sale of foreshore
lands, however, became a constitutional edict under the 1935
Constitution. Foreshore lands became inalienable as natural resources
of the State, unless reclaimed by the government and classified as
agricultural lands of the public domain, in which case they would fall
under the classification of government reclaimed lands.
After the effectivity of the 1935 Constitution, government reclaimed and
marshy disposable lands of the public domain continued to be only
leased and not sold to private parties. 56 These lands remained sui
generis, as the only alienable or disposable lands of the public domain
the government could not sell to private parties.
Since then and until now, the only way the government can sell to
private parties government reclaimed and marshy disposable lands of
the public domain is for the legislature to pass a law authorizing such
sale. CA No. 141 does not authorize the President to reclassify
government reclaimed and marshy lands into other non-agricultural
lands under Section 59 (d). Lands classified under Section 59 (d) are
the only alienable or disposable lands for non-agricultural purposes that
the government could sell to private parties.
Moreover, Section 60 of CA No. 141 expressly requires congressional
authority before lands under Section 59 that the government previously
transferred to government units or entities could be sold to private
parties. Section 60 of CA No. 141 declares that –
"Sec. 60. x x x The area so leased or sold shall be such as
shall, in the judgment of the Secretary of Agriculture and
Natural Resources, be reasonably necessary for the purposes
for which such sale or lease is requested, and shall not
exceed one hundred and forty-four hectares: Provided,
however, That this limitation shall not apply to grants,
donations, or transfers made to a province, municipality or
branch or subdivision of the Government for the purposes
deemed by said entities conducive to the public interest; but
the land so granted, donated, or transferred to a
province, municipality or branch or subdivision of the
Government shall not be alienated, encumbered, or
otherwise disposed of in a manner affecting its title,
except when authorized by Congress: x x x." (Emphasis
supplied)
The congressional authority required in Section 60 of CA No. 141
mirrors the legislative authority required in Section 56 of Act No. 2874.
One reason for the congressional authority is that Section 60 of CA No.
141 exempted government units and entities from the maximum area of
public lands that could be acquired from the State. These government
units and entities should not just turn around and sell these lands to
private parties in violation of constitutional or statutory limitations.
Otherwise, the transfer of lands for non-agricultural purposes to
government units and entities could be used to circumvent
constitutional limitations on ownership of alienable or disposable lands
of the public domain. In the same manner, such transfers could also be
used to evade the statutory prohibition in CA No. 141 on the sale of
government reclaimed and marshy lands of the public domain to private
parties. Section 60 of CA No. 141 constitutes by operation of law a lien
on these lands.57
In case of sale or lease of disposable lands of the public domain falling
under Section 59 of CA No. 141, Sections 63 and 67 require a public
bidding. Sections 63 and 67 of CA No. 141 provide as follows:
"Sec. 63. Whenever it is decided that lands covered by this
chapter are not needed for public purposes, the Director of
Lands shall ask the Secretary of Agriculture and Commerce
(now the Secretary of Natural Resources) for authority to
dispose of the same. Upon receipt of such authority, the
Director of Lands shall give notice by public advertisement in
the same manner as in the case of leases or sales of
agricultural public land, x x x.
Sec. 67. The lease or sale shall be made by oral bidding;
and adjudication shall be made to the highest bidder. x x
x." (Emphasis supplied)
Thus, CA No. 141 mandates the Government to put to public auction all
leases or sales of alienable or disposable lands of the public domain. 58
Like Act No. 1654 and Act No. 2874 before it, CA No. 141 did not
repeal Section 5 of the Spanish Law of Waters of 1866. Private parties
could still reclaim portions of the sea with government permission.
However, the reclaimed land could become private land only if
classified as alienable agricultural land of the public domain open
to disposition under CA No. 141. The 1935 Constitution prohibited the
alienation of all natural resources except public agricultural lands.
The Civil Code of 1950
The Civil Code of 1950 readopted substantially the definition of property
of public dominion found in the Civil Code of 1889. Articles 420 and 422
of the Civil Code of 1950 state that –
"Art. 420. The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals,
rivers, torrents, ports and bridges constructed by the State,
banks, shores, roadsteads, and others of similar character;
(2) Those which belong to the State, without being for public
use, and are intended for some public service or for the
development of the national wealth.
x x x.
Art. 422. Property of public dominion, when no longer
intended for public use or for public service, shall form part of
the patrimonial property of the State."
Again, the government must formally declare that the property of public
dominion is no longer needed for public use or public service, before
the same could be classified as patrimonial property of the State. 59 In
the case of government reclaimed and marshy lands of the public
domain, the declaration of their being disposable, as well as the
manner of their disposition, is governed by the applicable provisions of
CA No. 141.
Like the Civil Code of 1889, the Civil Code of 1950 included as property
of public dominion those properties of the State which, without being for
public use, are intended for public service or the "development of the
national wealth." Thus, government reclaimed and marshy lands of the
State, even if not employed for public use or public service, if
developed to enhance the national wealth, are classified as property of
public dominion.
Dispositions under the 1973 Constitution
The 1973 Constitution, which took effect on January 17, 1973, likewise
adopted the Regalian doctrine. Section 8, Article XIV of the 1973
Constitution stated that –
"Sec. 8. All lands of the public domain, waters, minerals, coal,
petroleum and other mineral oils, all forces of potential
energy, fisheries, wildlife, and other natural resources of the
Philippines belong to the State. With the exception of
agricultural, industrial or commercial, residential, and
resettlement lands of the public domain, natural
resources shall not be alienated, and no license,
concession, or lease for the exploration, development,
exploitation, or utilization of any of the natural resources shall
be granted for a period exceeding twenty-five years,
renewable for not more than twenty-five years, except as to
water rights for irrigation, water supply, fisheries, or industrial
uses other than the development of water power, in which
cases, beneficial use may be the measure and the limit of the
grant." (Emphasis supplied)
The 1973 Constitution prohibited the alienation of all natural resources
with the exception of "agricultural, industrial or commercial, residential,
and resettlement lands of the public domain." In contrast, the 1935
Constitution barred the alienation of all natural resources except "public
agricultural lands." However, the term "public agricultural lands" in the
1935 Constitution encompassed industrial, commercial, residential and
resettlement lands of the public domain. 60 If the land of public domain
were neither timber nor mineral land, it would fall under the
classification of agricultural land of the public domain. Both the 1935
and 1973 Constitutions, therefore, prohibited the alienation of all
natural resources except agricultural lands of the public domain.
The 1973 Constitution, however, limited the alienation of lands of the
public domain to individuals who were citizens of the Philippines.
Private corporations, even if wholly owned by Philippine citizens, were
no longer allowed to acquire alienable lands of the public domain unlike
in the 1935 Constitution. Section 11, Article XIV of the 1973
Constitution declared that –
"Sec. 11. The Batasang Pambansa, taking into account
conservation, ecological, and development requirements of
the natural resources, shall determine by law the size of land
of the public domain which may be developed, held or
acquired by, or leased to, any qualified individual, corporation,
or association, and the conditions therefor. No private
corporation or association may hold alienable lands of
the public domain except by lease not to exceed one
thousand hectares in area nor may any citizen hold such
lands by lease in excess of five hundred hectares or acquire
by purchase, homestead or grant, in excess of twenty-four
hectares. No private corporation or association may hold by
lease, concession, license or permit, timber or forest lands
and other timber or forest resources in excess of one hundred
thousand hectares. However, such area may be increased by
the Batasang Pambansa upon recommendation of the
National Economic and Development Authority." (Emphasis
supplied)
Thus, under the 1973 Constitution, private corporations could hold
alienable lands of the public domain only through lease. Only
individuals could now acquire alienable lands of the public domain, and
private corporations became absolutely barred from acquiring any
kind of alienable land of the public domain. The constitutional ban
extended to all kinds of alienable lands of the public domain, while the
statutory ban under CA No. 141 applied only to government reclaimed,
foreshore and marshy alienable lands of the public domain.
PD No. 1084 Creating the Public Estates Authority
On February 4, 1977, then President Ferdinand Marcos issued
Presidential Decree No. 1084 creating PEA, a wholly government
owned and controlled corporation with a special charter. Sections 4 and
8 of PD No. 1084, vests PEA with the following purposes and powers:
"Sec. 4. Purpose. The Authority is hereby created for the
following purposes:
(a) To reclaim land, including foreshore and submerged
areas, by dredging, filling or other means, or to acquire
reclaimed land;
(b) To develop, improve, acquire, administer, deal in,
subdivide, dispose, lease and sell any and all kinds of
lands, buildings, estates and other forms of real property,
owned, managed, controlled and/or operated by the
government;
(c) To provide for, operate or administer such service as may
be necessary for the efficient, economical and beneficial
utilization of the above properties.
Sec. 5. Powers and functions of the Authority. The Authority
shall, in carrying out the purposes for which it is created, have
the following powers and functions:
(a)To prescribe its by-laws.
xxx
(i) To hold lands of the public domain in excess of the area
permitted to private corporations by statute.
(j) To reclaim lands and to construct work across, or
otherwise, any stream, watercourse, canal, ditch, flume x x x.
xxx
(o) To perform such acts and exercise such functions as may
be necessary for the attainment of the purposes and
objectives herein specified." (Emphasis supplied)
PD No. 1084 authorizes PEA to reclaim both foreshore and submerged
areas of the public domain. Foreshore areas are those covered and
uncovered by the ebb and flow of the tide. 61 Submerged areas are
those permanently under water regardless of the ebb and flow of the
tide.62 Foreshore and submerged areas indisputably belong to the
public domain63 and are inalienable unless reclaimed, classified as
alienable lands open to disposition, and further declared no longer
needed for public service.
The ban in the 1973 Constitution on private corporations from acquiring
alienable lands of the public domain did not apply to PEA since it was
then, and until today, a fully owned government corporation. The
constitutional ban applied then, as it still applies now, only to "private
corporations and associations." PD No. 1084 expressly empowers PEA
"to hold lands of the public domain" even "in excess of the area
permitted to private corporations by statute." Thus, PEA can hold title
to private lands, as well as title to lands of the public domain.
In order for PEA to sell its reclaimed foreshore and submerged
alienable lands of the public domain, there must be legislative authority
empowering PEA to sell these lands. This legislative authority is
necessary in view of Section 60 of CA No.141, which states –
"Sec. 60. x x x; but the land so granted, donated or
transferred to a province, municipality, or branch or
subdivision of the Government shall not be alienated,
encumbered or otherwise disposed of in a manner affecting
its title, except when authorized by Congress; x x x."
(Emphasis supplied)
Without such legislative authority, PEA could not sell but only lease its
reclaimed foreshore and submerged alienable lands of the public
domain. Nevertheless, any legislative authority granted to PEA to sell
its reclaimed alienable lands of the public domain would be subject to
the constitutional ban on private corporations from acquiring alienable
lands of the public domain. Hence, such legislative authority could only
benefit private individuals.
Dispositions under the 1987 Constitution
The 1987 Constitution, like the 1935 and 1973 Constitutions before it,
has adopted the Regalian doctrine. The 1987 Constitution declares that
all natural resources are "owned by the State," and except for
alienable agricultural lands of the public domain, natural resources
cannot be alienated. Sections 2 and 3, Article XII of the 1987
Constitution state that –
"Section 2. All lands of the public domain, waters, minerals,
coal, petroleum and other mineral oils, all forces of potential
energy, fisheries, forests or timber, wildlife, flora and fauna,
and other natural resources are owned by the State. With
the exception of agricultural lands, all other natural
resources shall not be alienated. The exploration,
development, and utilization of natural resources shall be
under the full control and supervision of the State. x x x.
Section 3. Lands of the public domain are classified into
agricultural, forest or timber, mineral lands, and national
parks. Agricultural lands of the public domain may be further
classified by law according to the uses which they may be
devoted. Alienable lands of the public domain shall be
limited to agricultural lands. Private corporations or
associations may not hold such alienable lands of the
public domain except by lease, for a period not
exceeding twenty-five years, renewable for not more than
twenty-five years, and not to exceed one thousand
hectares in area. Citizens of the Philippines may lease not
more than five hundred hectares, or acquire not more than
twelve hectares thereof by purchase, homestead, or grant.
Taking into account the requirements of conservation,
ecology, and development, and subject to the requirements of
agrarian reform, the Congress shall determine, by law, the
size of lands of the public domain which may be acquired,
developed, held, or leased and the conditions therefor."
(Emphasis supplied)
The 1987 Constitution continues the State policy in the 1973
Constitution banning private corporations from acquiring any kind of
alienable land of the public domain. Like the 1973 Constitution, the
1987 Constitution allows private corporations to hold alienable lands of
the public domain only through lease. As in the 1935 and 1973
Constitutions, the general law governing the lease to private
corporations of reclaimed, foreshore and marshy alienable lands of the
public domain is still CA No. 141.
The Rationale behind the Constitutional Ban
The rationale behind the constitutional ban on corporations from
acquiring, except through lease, alienable lands of the public domain is
not well understood. During the deliberations of the 1986 Constitutional
Commission, the commissioners probed the rationale behind this ban,
thus:
"FR. BERNAS: Mr. Vice-President, my questions have
reference to page 3, line 5 which says:
`No private corporation or association may hold alienable
lands of the public domain except by lease, not to exceed one
thousand hectares in area.'
If we recall, this provision did not exist under the 1935
Constitution, but this was introduced in the 1973 Constitution.
In effect, it prohibits private corporations from acquiring
alienable public lands. But it has not been very clear in
jurisprudence what the reason for this is. In some of the
cases decided in 1982 and 1983, it was indicated that the
purpose of this is to prevent large landholdings. Is that
the intent of this provision?
MR. VILLEGAS: I think that is the spirit of the provision.
FR. BERNAS: In existing decisions involving the Iglesia ni
Cristo, there were instances where the Iglesia ni Cristo was
not allowed to acquire a mere 313-square meter land where a
chapel stood because the Supreme Court said it would be in
violation of this." (Emphasis supplied)
In Ayog v. Cusi,64 the Court explained the rationale behind this
constitutional ban in this way:
"Indeed, one purpose of the constitutional prohibition against
purchases of public agricultural lands by private corporations
is to equitably diffuse land ownership or to encourage 'owner-
cultivatorship and the economic family-size farm' and to
prevent a recurrence of cases like the instant case. Huge
landholdings by corporations or private persons had spawned
social unrest."
However, if the constitutional intent is to prevent huge landholdings, the
Constitution could have simply limited the size of alienable lands of the
public domain that corporations could acquire. The Constitution could
have followed the limitations on individuals, who could acquire not more
than 24 hectares of alienable lands of the public domain under the 1973
Constitution, and not more than 12 hectares under the 1987
Constitution.
If the constitutional intent is to encourage economic family-size farms,
placing the land in the name of a corporation would be more effective in
preventing the break-up of farmlands. If the farmland is registered in the
name of a corporation, upon the death of the owner, his heirs would
inherit shares in the corporation instead of subdivided parcels of the
farmland. This would prevent the continuing break-up of farmlands into
smaller and smaller plots from one generation to the next.
In actual practice, the constitutional ban strengthens the constitutional
limitation on individuals from acquiring more than the allowed area of
alienable lands of the public domain. Without the constitutional ban,
individuals who already acquired the maximum area of alienable lands
of the public domain could easily set up corporations to acquire more
alienable public lands. An individual could own as many corporations as
his means would allow him. An individual could even hide his
ownership of a corporation by putting his nominees as stockholders of
the corporation. The corporation is a convenient vehicle to circumvent
the constitutional limitation on acquisition by individuals of alienable
lands of the public domain.
The constitutional intent, under the 1973 and 1987 Constitutions, is to
transfer ownership of only a limited area of alienable land of the public
domain to a qualified individual. This constitutional intent is
safeguarded by the provision prohibiting corporations from acquiring
alienable lands of the public domain, since the vehicle to circumvent the
constitutional intent is removed. The available alienable public lands
are gradually decreasing in the face of an ever-growing population. The
most effective way to insure faithful adherence to this constitutional
intent is to grant or sell alienable lands of the public domain only to
individuals. This, it would seem, is the practical benefit arising from the
constitutional ban.
The Amended Joint Venture Agreement
The subject matter of the Amended JVA, as stated in its second
Whereas clause, consists of three properties, namely:
1. "[T]hree partially reclaimed and substantially eroded islands
along Emilio Aguinaldo Boulevard in Paranaque and Las
Pinas, Metro Manila, with a combined titled area of 1,578,441
square meters;"
2. "[A]nother area of 2,421,559 square meters contiguous to
the three islands;" and
3. "[A]t AMARI's option as approved by PEA, an additional
350 hectares more or less to regularize the configuration of
the reclaimed area."65
PEA confirms that the Amended JVA involves "the development of the
Freedom Islands and further reclamation of about 250 hectares x x x,"
plus an option "granted to AMARI to subsequently reclaim another 350
hectares x x x."66
In short, the Amended JVA covers a reclamation area of 750 hectares.
Only 157.84 hectares of the 750-hectare reclamation project have
been reclaimed, and the rest of the 592.15 hectares are still
submerged areas forming part of Manila Bay.
Under the Amended JVA, AMARI will reimburse PEA the sum of
P1,894,129,200.00 for PEA's "actual cost" in partially reclaiming the
Freedom Islands. AMARI will also complete, at its own expense, the
reclamation of the Freedom Islands. AMARI will further shoulder all the
reclamation costs of all the other areas, totaling 592.15 hectares, still to
be reclaimed. AMARI and PEA will share, in the proportion of 70
percent and 30 percent, respectively, the total net usable area which is
defined in the Amended JVA as the total reclaimed area less 30
percent earmarked for common areas. Title to AMARI's share in the net
usable area, totaling 367.5 hectares, will be issued in the name of
AMARI. Section 5.2 (c) of the Amended JVA provides that –
"x x x, PEA shall have the duty to execute without delay the
necessary deed of transfer or conveyance of the title
pertaining to AMARI's Land share based on the Land
Allocation Plan. PEA, when requested in writing by AMARI,
shall then cause the issuance and delivery of the proper
certificates of title covering AMARI's Land Share in the
name of AMARI, x x x; provided, that if more than seventy
percent (70%) of the titled area at any given time pertains to
AMARI, PEA shall deliver to AMARI only seventy percent
(70%) of the titles pertaining to AMARI, until such time when a
corresponding proportionate area of additional land pertaining
to PEA has been titled." (Emphasis supplied)
Indisputably, under the Amended JVA AMARI will acquire and own
a maximum of 367.5 hectares of reclaimed land which will be titled
in its name.
To implement the Amended JVA, PEA delegated to the unincorporated
PEA-AMARI joint venture PEA's statutory authority, rights and
privileges to reclaim foreshore and submerged areas in Manila Bay.
Section 3.2.a of the Amended JVA states that –
"PEA hereby contributes to the joint venture its rights and
privileges to perform Rawland Reclamation and Horizontal
Development as well as own the Reclamation Area, thereby
granting the Joint Venture the full and exclusive right,
authority and privilege to undertake the Project in accordance
with the Master Development Plan."
The Amended JVA is the product of a renegotiation of the original JVA
dated April 25, 1995 and its supplemental agreement dated August 9,
1995.
The Threshold Issue
The threshold issue is whether AMARI, a private corporation, can
acquire and own under the Amended JVA 367.5 hectares of reclaimed
foreshore and submerged areas in Manila Bay in view of Sections 2
and 3, Article XII of the 1987 Constitution which state that:
"Section 2. All lands of the public domain, waters, minerals,
coal, petroleum, and other mineral oils, all forces of potential
energy, fisheries, forests or timber, wildlife, flora and fauna,
and other natural resources are owned by the State. With the
exception of agricultural lands, all other natural
resources shall not be alienated. x x x.
xxx
Section 3. x x x Alienable lands of the public domain shall be
limited to agricultural lands. Private corporations or
associations may not hold such alienable lands of the
public domain except by lease, x x x."(Emphasis supplied)
Classification of Reclaimed Foreshore and Submerged Areas
PEA readily concedes that lands reclaimed from foreshore or
submerged areas of Manila Bay are alienable or disposable lands of
the public domain. In its Memorandum,67 PEA admits that –
"Under the Public Land Act (CA 141, as amended),
reclaimed lands are classified as alienable and
disposable lands of the public domain:
'Sec. 59. The lands disposable under this title shall
be classified as follows:
(a) Lands reclaimed by the government by dredging,
filling, or other means;
x x x.'" (Emphasis supplied)
Likewise, the Legal Task Force 68 constituted under Presidential
Administrative Order No. 365 admitted in its Report and
Recommendation to then President Fidel V. Ramos, "[R]eclaimed
lands are classified as alienable and disposable lands of the
public domain."69 The Legal Task Force concluded that –
"D. Conclusion
Reclaimed lands are lands of the public domain. However, by
statutory authority, the rights of ownership and disposition
over reclaimed lands have been transferred to PEA, by virtue
of which PEA, as owner, may validly convey the same to any
qualified person without violating the Constitution or any
statute.
The constitutional provision prohibiting private corporations
from holding public land, except by lease (Sec. 3, Art. XVII, 70
1987 Constitution), does not apply to reclaimed lands whose
ownership has passed on to PEA by statutory grant."
Under Section 2, Article XII of the 1987 Constitution, the foreshore and
submerged areas of Manila Bay are part of the "lands of the public
domain, waters x x x and other natural resources" and consequently
"owned by the State." As such, foreshore and submerged areas "shall
not be alienated," unless they are classified as "agricultural lands" of
the public domain. The mere reclamation of these areas by PEA does
not convert these inalienable natural resources of the State into
alienable or disposable lands of the public domain. There must be a law
or presidential proclamation officially classifying these reclaimed lands
as alienable or disposable and open to disposition or concession.
Moreover, these reclaimed lands cannot be classified as alienable or
disposable if the law has reserved them for some public or quasi-public
use.71
Section 8 of CA No. 141 provides that "only those lands shall be
declared open to disposition or concession which have been officially
delimited and classified."72 The President has the authority to classify
inalienable lands of the public domain into alienable or disposable lands
of the public domain, pursuant to Section 6 of CA No. 141. In Laurel vs.
Garcia,73 the Executive Department attempted to sell the Roppongi
property in Tokyo, Japan, which was acquired by the Philippine
Government for use as the Chancery of the Philippine Embassy.
Although the Chancery had transferred to another location thirteen
years earlier, the Court still ruled that, under Article 422 74 of the Civil
Code, a property of public dominion retains such character until
formally declared otherwise. The Court ruled that –
"The fact that the Roppongi site has not been used for a long
time for actual Embassy service does not automatically
convert it to patrimonial property. Any such conversion
happens only if the property is withdrawn from public use
(Cebu Oxygen and Acetylene Co. v. Bercilles, 66 SCRA 481
[1975]. A property continues to be part of the public
domain, not available for private appropriation or
ownership 'until there is a formal declaration on the part
of the government to withdraw it from being such'
(Ignacio v. Director of Lands, 108 Phil. 335 [1960]."
(Emphasis supplied)
PD No. 1085, issued on February 4, 1977, authorized the issuance of
special land patents for lands reclaimed by PEA from the foreshore or
submerged areas of Manila Bay. On January 19, 1988 then President
Corazon C. Aquino issued Special Patent No. 3517 in the name of PEA
for the 157.84 hectares comprising the partially reclaimed Freedom
Islands. Subsequently, on April 9, 1999 the Register of Deeds of the
Municipality of Paranaque issued TCT Nos. 7309, 7311 and 7312 in the
name of PEA pursuant to Section 103 of PD No. 1529 authorizing the
issuance of certificates of title corresponding to land patents. To this
day, these certificates of title are still in the name of PEA.
PD No. 1085, coupled with President Aquino's actual issuance of a
special patent covering the Freedom Islands, is equivalent to an official
proclamation classifying the Freedom Islands as alienable or
disposable lands of the public domain. PD No. 1085 and President
Aquino's issuance of a land patent also constitute a declaration that the
Freedom Islands are no longer needed for public service. The
Freedom Islands are thus alienable or disposable lands of the
public domain, open to disposition or concession to qualified
parties.
At the time then President Aquino issued Special Patent No. 3517, PEA
had already reclaimed the Freedom Islands although subsequently
there were partial erosions on some areas. The government had also
completed the necessary surveys on these islands. Thus, the Freedom
Islands were no longer part of Manila Bay but part of the land mass.
Section 3, Article XII of the 1987 Constitution classifies lands of the
public domain into "agricultural, forest or timber, mineral lands, and
national parks." Being neither timber, mineral, nor national park lands,
the reclaimed Freedom Islands necessarily fall under the classification
of agricultural lands of the public domain. Under the 1987 Constitution,
agricultural lands of the public domain are the only natural resources
that the State may alienate to qualified private parties. All other natural
resources, such as the seas or bays, are "waters x x x owned by the
State" forming part of the public domain, and are inalienable pursuant
to Section 2, Article XII of the 1987 Constitution.
AMARI claims that the Freedom Islands are private lands because
CDCP, then a private corporation, reclaimed the islands under a
contract dated November 20, 1973 with the Commissioner of Public
Highways. AMARI, citing Article 5 of the Spanish Law of Waters of
1866, argues that "if the ownership of reclaimed lands may be given to
the party constructing the works, then it cannot be said that reclaimed
lands are lands of the public domain which the State may not
alienate."75 Article 5 of the Spanish Law of Waters reads as follows:
"Article 5. Lands reclaimed from the sea in consequence of
works constructed by the State, or by the provinces, pueblos
or private persons, with proper permission, shall become the
property of the party constructing such works, unless
otherwise provided by the terms of the grant of
authority." (Emphasis supplied)
Under Article 5 of the Spanish Law of Waters of 1866, private parties
could reclaim from the sea only with "proper permission" from the State.
Private parties could own the reclaimed land only if not "otherwise
provided by the terms of the grant of authority." This clearly meant that
no one could reclaim from the sea without permission from the State
because the sea is property of public dominion. It also meant that the
State could grant or withhold ownership of the reclaimed land because
any reclaimed land, like the sea from which it emerged, belonged to the
State. Thus, a private person reclaiming from the sea without
permission from the State could not acquire ownership of the reclaimed
land which would remain property of public dominion like the sea it
replaced.76 Article 5 of the Spanish Law of Waters of 1866 adopted the
time-honored principle of land ownership that "all lands that were not
acquired from the government, either by purchase or by grant, belong
to the public domain."77
Article 5 of the Spanish Law of Waters must be read together with laws
subsequently enacted on the disposition of public lands. In particular,
CA No. 141 requires that lands of the public domain must first be
classified as alienable or disposable before the government can
alienate them. These lands must not be reserved for public or quasi-
public purposes.78 Moreover, the contract between CDCP and the
government was executed after the effectivity of the 1973 Constitution
which barred private corporations from acquiring any kind of alienable
land of the public domain. This contract could not have converted the
Freedom Islands into private lands of a private corporation.
Presidential Decree No. 3-A, issued on January 11, 1973, revoked all
laws authorizing the reclamation of areas under water and revested
solely in the National Government the power to reclaim lands. Section 1
of PD No. 3-A declared that –
"The provisions of any law to the contrary
notwithstanding, the reclamation of areas under water,
whether foreshore or inland, shall be limited to the National
Government or any person authorized by it under a
proper contract. (Emphasis supplied)
x x x."
PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866
because reclamation of areas under water could now be undertaken
only by the National Government or by a person contracted by the
National Government. Private parties may reclaim from the sea only
under a contract with the National Government, and no longer by grant
or permission as provided in Section 5 of the Spanish Law of Waters of
1866.
Executive Order No. 525, issued on February 14, 1979, designated
PEA as the National Government's implementing arm to undertake "all
reclamation projects of the government," which "shall be undertaken
by the PEA or through a proper contract executed by it with any
person or entity." Under such contract, a private party receives
compensation for reclamation services rendered to PEA. Payment to
the contractor may be in cash, or in kind consisting of portions of the
reclaimed land, subject to the constitutional ban on private corporations
from acquiring alienable lands of the public domain. The reclaimed land
can be used as payment in kind only if the reclaimed land is first
classified as alienable or disposable land open to disposition, and then
declared no longer needed for public service.
The Amended JVA covers not only the Freedom Islands, but also an
additional 592.15 hectares which are still submerged and forming part
of Manila Bay. There is no legislative or Presidential act classifying
these submerged areas as alienable or disposable lands of the
public domain open to disposition. These submerged areas are not
covered by any patent or certificate of title. There can be no dispute
that these submerged areas form part of the public domain, and in their
present state are inalienable and outside the commerce of man.
Until reclaimed from the sea, these submerged areas are, under the
Constitution, "waters x x x owned by the State," forming part of the
public domain and consequently inalienable. Only when actually
reclaimed from the sea can these submerged areas be classified as
public agricultural lands, which under the Constitution are the only
natural resources that the State may alienate. Once reclaimed and
transformed into public agricultural lands, the government may then
officially classify these lands as alienable or disposable lands open to
disposition. Thereafter, the government may declare these lands no
longer needed for public service. Only then can these reclaimed lands
be considered alienable or disposable lands of the public domain and
within the commerce of man.
The classification of PEA's reclaimed foreshore and submerged lands
into alienable or disposable lands open to disposition is necessary
because PEA is tasked under its charter to undertake public services
that require the use of lands of the public domain. Under Section 5 of
PD No. 1084, the functions of PEA include the following: "[T]o own or
operate railroads, tramways and other kinds of land transportation, x x
x; [T]o construct, maintain and operate such systems of sanitary sewers
as may be necessary; [T]o construct, maintain and operate such storm
drains as may be necessary." PEA is empowered to issue "rules and
regulations as may be necessary for the proper use by private parties
of any or all of the highways, roads, utilities, buildings and/or any
of its properties and to impose or collect fees or tolls for their use."
Thus, part of the reclaimed foreshore and submerged lands held by the
PEA would actually be needed for public use or service since many of
the functions imposed on PEA by its charter constitute essential public
services.
Moreover, Section 1 of Executive Order No. 525 provides that PEA
"shall be primarily responsible for integrating, directing, and
coordinating all reclamation projects for and on behalf of the National
Government." The same section also states that "[A]ll reclamation
projects shall be approved by the President upon recommendation of
the PEA, and shall be undertaken by the PEA or through a proper
contract executed by it with any person or entity; x x x." Thus, under EO
No. 525, in relation to PD No. 3-A and PD No.1084, PEA became the
primary implementing agency of the National Government to reclaim
foreshore and submerged lands of the public domain. EO No. 525
recognized PEA as the government entity "to undertake the reclamation
of lands and ensure their maximum utilization in promoting public
welfare and interests."79 Since large portions of these reclaimed lands
would obviously be needed for public service, there must be a formal
declaration segregating reclaimed lands no longer needed for public
service from those still needed for public service.1âwphi1.nêt
Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA
"shall belong to or be owned by the PEA," could not automatically
operate to classify inalienable lands into alienable or disposable lands
of the public domain. Otherwise, reclaimed foreshore and submerged
lands of the public domain would automatically become alienable once
reclaimed by PEA, whether or not classified as alienable or disposable.
The Revised Administrative Code of 1987, a later law than either PD
No. 1084 or EO No. 525, vests in the Department of Environment and
Natural Resources ("DENR" for brevity) the following powers and
functions:
"Sec. 4. Powers and Functions. The Department shall:
(1) x x x
xxx
(4) Exercise supervision and control over forest lands,
alienable and disposable public lands, mineral resources
and, in the process of exercising such control, impose
appropriate taxes, fees, charges, rentals and any such form of
levy and collect such revenues for the exploration,
development, utilization or gathering of such resources;
xxx
(14) Promulgate rules, regulations and guidelines on the
issuance of licenses, permits, concessions, lease
agreements and such other privileges concerning the
development, exploration and utilization of the country's
marine, freshwater, and brackish water and over all
aquatic resources of the country and shall continue to
oversee, supervise and police our natural resources;
cancel or cause to cancel such privileges upon failure, non-
compliance or violations of any regulation, order, and for all
other causes which are in furtherance of the conservation of
natural resources and supportive of the national interest;
(15) Exercise exclusive jurisdiction on the management
and disposition of all lands of the public domain and
serve as the sole agency responsible for classification,
sub-classification, surveying and titling of lands in consultation
with appropriate agencies."80 (Emphasis supplied)
As manager, conservator and overseer of the natural resources of the
State, DENR exercises "supervision and control over alienable and
disposable public lands." DENR also exercises "exclusive jurisdiction
on the management and disposition of all lands of the public domain."
Thus, DENR decides whether areas under water, like foreshore or
submerged areas of Manila Bay, should be reclaimed or not. This
means that PEA needs authorization from DENR before PEA can
undertake reclamation projects in Manila Bay, or in any part of the
country.
DENR also exercises exclusive jurisdiction over the disposition of all
lands of the public domain. Hence, DENR decides whether reclaimed
lands of PEA should be classified as alienable under Sections 6 81 and
782 of CA No. 141. Once DENR decides that the reclaimed lands should
be so classified, it then recommends to the President the issuance of a
proclamation classifying the lands as alienable or disposable lands of
the public domain open to disposition. We note that then DENR
Secretary Fulgencio S. Factoran, Jr. countersigned Special Patent No.
3517 in compliance with the Revised Administrative Code and Sections
6 and 7 of CA No. 141.
In short, DENR is vested with the power to authorize the reclamation of
areas under water, while PEA is vested with the power to undertake the
physical reclamation of areas under water, whether directly or through
private contractors. DENR is also empowered to classify lands of the
public domain into alienable or disposable lands subject to the approval
of the President. On the other hand, PEA is tasked to develop, sell or
lease the reclaimed alienable lands of the public domain.
Clearly, the mere physical act of reclamation by PEA of foreshore or
submerged areas does not make the reclaimed lands alienable or
disposable lands of the public domain, much less patrimonial lands of
PEA. Likewise, the mere transfer by the National Government of lands
of the public domain to PEA does not make the lands alienable or
disposable lands of the public domain, much less patrimonial lands of
PEA.
Absent two official acts – a classification that these lands are alienable
or disposable and open to disposition and a declaration that these
lands are not needed for public service, lands reclaimed by PEA remain
inalienable lands of the public domain. Only such an official
classification and formal declaration can convert reclaimed lands into
alienable or disposable lands of the public domain, open to disposition
under the Constitution, Title I and Title III83 of CA No. 141 and other
applicable laws.84
PEA's Authority to Sell Reclaimed Lands
PEA, like the Legal Task Force, argues that as alienable or disposable
lands of the public domain, the reclaimed lands shall be disposed of in
accordance with CA No. 141, the Public Land Act. PEA, citing Section
60 of CA No. 141, admits that reclaimed lands transferred to a branch
or subdivision of the government "shall not be alienated, encumbered,
or otherwise disposed of in a manner affecting its title, except when
authorized by Congress: x x x."85 (Emphasis by PEA)
In Laurel vs. Garcia,86 the Court cited Section 48 of the Revised
Administrative Code of 1987, which states that –
"Sec. 48. Official Authorized to Convey Real Property.
Whenever real property of the Government is authorized by
law to be conveyed, the deed of conveyance shall be
executed in behalf of the government by the following: x x x."
Thus, the Court concluded that a law is needed to convey any real
property belonging to the Government. The Court declared that -
"It is not for the President to convey real property of the
government on his or her own sole will. Any such
conveyance must be authorized and approved by a law
enacted by the Congress. It requires executive and
legislative concurrence." (Emphasis supplied)
PEA contends that PD No. 1085 and EO No. 525 constitute the
legislative authority allowing PEA to sell its reclaimed lands. PD No.
1085, issued on February 4, 1977, provides that –
"The land reclaimed in the foreshore and offshore area of
Manila Bay pursuant to the contract for the reclamation and
construction of the Manila-Cavite Coastal Road Project
between the Republic of the Philippines and the Construction
and Development Corporation of the Philippines dated
November 20, 1973 and/or any other contract or reclamation
covering the same area is hereby transferred, conveyed
and assigned to the ownership and administration of the
Public Estates Authority established pursuant to PD No.
1084; Provided, however, That the rights and interests of the
Construction and Development Corporation of the Philippines
pursuant to the aforesaid contract shall be recognized and
respected.
Henceforth, the Public Estates Authority shall exercise the
rights and assume the obligations of the Republic of the
Philippines (Department of Public Highways) arising from, or
incident to, the aforesaid contract between the Republic of the
Philippines and the Construction and Development
Corporation of the Philippines.
In consideration of the foregoing transfer and assignment, the
Public Estates Authority shall issue in favor of the Republic of
the Philippines the corresponding shares of stock in said
entity with an issued value of said shares of stock (which)
shall be deemed fully paid and non-assessable.
The Secretary of Public Highways and the General Manager
of the Public Estates Authority shall execute such contracts or
agreements, including appropriate agreements with the
Construction and Development Corporation of the Philippines,
as may be necessary to implement the above.
Special land patent/patents shall be issued by the
Secretary of Natural Resources in favor of the Public
Estates Authority without prejudice to the subsequent
transfer to the contractor or his assignees of such
portion or portions of the land reclaimed or to be
reclaimed as provided for in the above-mentioned
contract. On the basis of such patents, the Land
Registration Commission shall issue the corresponding
certificate of title." (Emphasis supplied)
On the other hand, Section 3 of EO No. 525, issued on February 14,
1979, provides that -
"Sec. 3. All lands reclaimed by PEA shall belong to or be
owned by the PEA which shall be responsible for its
administration, development, utilization or disposition in
accordance with the provisions of Presidential Decree No.
1084. Any and all income that the PEA may derive from the
sale, lease or use of reclaimed lands shall be used in
accordance with the provisions of Presidential Decree No.
1084."
There is no express authority under either PD No. 1085 or EO No. 525
for PEA to sell its reclaimed lands. PD No. 1085 merely transferred
"ownership and administration" of lands reclaimed from Manila Bay to
PEA, while EO No. 525 declared that lands reclaimed by PEA "shall
belong to or be owned by PEA." EO No. 525 expressly states that PEA
should dispose of its reclaimed lands "in accordance with the provisions
of Presidential Decree No. 1084," the charter of PEA.
PEA's charter, however, expressly tasks PEA "to develop, improve,
acquire, administer, deal in, subdivide, dispose, lease and sell any and
all kinds of lands x x x owned, managed, controlled and/or operated
by the government."87 (Emphasis supplied) There is, therefore,
legislative authority granted to PEA to sell its lands, whether
patrimonial or alienable lands of the public domain. PEA may sell
to private parties its patrimonial properties in accordance with the
PEA charter free from constitutional limitations. The constitutional ban
on private corporations from acquiring alienable lands of the public
domain does not apply to the sale of PEA's patrimonial lands.
PEA may also sell its alienable or disposable lands of the public
domain to private individuals since, with the legislative authority, there
is no longer any statutory prohibition against such sales and the
constitutional ban does not apply to individuals. PEA, however, cannot
sell any of its alienable or disposable lands of the public domain to
private corporations since Section 3, Article XII of the 1987 Constitution
expressly prohibits such sales. The legislative authority benefits only
individuals. Private corporations remain barred from acquiring any kind
of alienable land of the public domain, including government reclaimed
lands.
The provision in PD No. 1085 stating that portions of the reclaimed
lands could be transferred by PEA to the "contractor or his assignees"
(Emphasis supplied) would not apply to private corporations but only to
individuals because of the constitutional ban. Otherwise, the provisions
of PD No. 1085 would violate both the 1973 and 1987 Constitutions.
The requirement of public auction in the sale of reclaimed lands
Assuming the reclaimed lands of PEA are classified as alienable or
disposable lands open to disposition, and further declared no longer
needed for public service, PEA would have to conduct a public bidding
in selling or leasing these lands. PEA must observe the provisions of
Sections 63 and 67 of CA No. 141 requiring public auction, in the
absence of a law exempting PEA from holding a public auction. 88
Special Patent No. 3517 expressly states that the patent is issued by
authority of the Constitution and PD No. 1084, "supplemented by
Commonwealth Act No. 141, as amended." This is an acknowledgment
that the provisions of CA No. 141 apply to the disposition of reclaimed
alienable lands of the public domain unless otherwise provided by law.
Executive Order No. 654,89 which authorizes PEA "to determine the
kind and manner of payment for the transfer" of its assets and
properties, does not exempt PEA from the requirement of public
auction. EO No. 654 merely authorizes PEA to decide the mode of
payment, whether in kind and in installment, but does not authorize
PEA to dispense with public auction.
Moreover, under Section 79 of PD No. 1445, otherwise known as the
Government Auditing Code, the government is required to sell valuable
government property through public bidding. Section 79 of PD No. 1445
mandates that –
"Section 79. When government property has become
unserviceable for any cause, or is no longer needed, it shall,
upon application of the officer accountable therefor, be
inspected by the head of the agency or his duly authorized
representative in the presence of the auditor concerned and, if
found to be valueless or unsaleable, it may be destroyed in
their presence. If found to be valuable, it may be sold at
public auction to the highest bidder under the supervision
of the proper committee on award or similar body in the
presence of the auditor concerned or other authorized
representative of the Commission, after advertising by
printed notice in the Official Gazette, or for not less than
three consecutive days in any newspaper of general
circulation, or where the value of the property does not
warrant the expense of publication, by notices posted for a
like period in at least three public places in the locality where
the property is to be sold. In the event that the public
auction fails, the property may be sold at a private sale at
such price as may be fixed by the same committee or
body concerned and approved by the Commission."
It is only when the public auction fails that a negotiated sale is allowed,
in which case the Commission on Audit must approve the selling
price.90 The Commission on Audit implements Section 79 of the
Government Auditing Code through Circular No. 89-296 91 dated
January 27, 1989. This circular emphasizes that government assets
must be disposed of only through public auction, and a negotiated sale
can be resorted to only in case of "failure of public auction."
At the public auction sale, only Philippine citizens are qualified to bid for
PEA's reclaimed foreshore and submerged alienable lands of the public
domain. Private corporations are barred from bidding at the auction
sale of any kind of alienable land of the public domain.
PEA originally scheduled a public bidding for the Freedom Islands on
December 10, 1991. PEA imposed a condition that the winning bidder
should reclaim another 250 hectares of submerged areas to regularize
the shape of the Freedom Islands, under a 60-40 sharing of the
additional reclaimed areas in favor of the winning bidder. 92 No one,
however, submitted a bid. On December 23, 1994, the Government
Corporate Counsel advised PEA it could sell the Freedom Islands
through negotiation, without need of another public bidding, because of
the failure of the public bidding on December 10, 1991.93
However, the original JVA dated April 25, 1995 covered not only the
Freedom Islands and the additional 250 hectares still to be reclaimed, it
also granted an option to AMARI to reclaim another 350 hectares. The
original JVA, a negotiated contract, enlarged the reclamation area to
750 hectares.94 The failure of public bidding on December 10, 1991,
involving only 407.84 hectares,95 is not a valid justification for a
negotiated sale of 750 hectares, almost double the area publicly
auctioned. Besides, the failure of public bidding happened on
December 10, 1991, more than three years before the signing of the
original JVA on April 25, 1995. The economic situation in the country
had greatly improved during the intervening period.
Reclamation under the BOT Law and the Local Government Code
The constitutional prohibition in Section 3, Article XII of the 1987
Constitution is absolute and clear: "Private corporations or associations
may not hold such alienable lands of the public domain except by
lease, x x x." Even Republic Act No. 6957 ("BOT Law," for brevity),
cited by PEA and AMARI as legislative authority to sell reclaimed lands
to private parties, recognizes the constitutional ban. Section 6 of RA
No. 6957 states –
"Sec. 6. Repayment Scheme. - For the financing,
construction, operation and maintenance of any infrastructure
projects undertaken through the build-operate-and-transfer
arrangement or any of its variations pursuant to the provisions
of this Act, the project proponent x x x may likewise be repaid
in the form of a share in the revenue of the project or other
non-monetary payments, such as, but not limited to, the grant
of a portion or percentage of the reclaimed land, subject to
the constitutional requirements with respect to the
ownership of the land: x x x." (Emphasis supplied)
A private corporation, even one that undertakes the physical
reclamation of a government BOT project, cannot acquire reclaimed
alienable lands of the public domain in view of the constitutional ban.
Section 302 of the Local Government Code, also mentioned by PEA
and AMARI, authorizes local governments in land reclamation projects
to pay the contractor or developer in kind consisting of a percentage of
the reclaimed land, to wit:
"Section 302. Financing, Construction, Maintenance,
Operation, and Management of Infrastructure Projects by the
Private Sector. x x x
xxx
In case of land reclamation or construction of industrial
estates, the repayment plan may consist of the grant of a
portion or percentage of the reclaimed land or the industrial
estate constructed."
Although Section 302 of the Local Government Code does not contain
a proviso similar to that of the BOT Law, the constitutional restrictions
on land ownership automatically apply even though not expressly
mentioned in the Local Government Code.
Thus, under either the BOT Law or the Local Government Code, the
contractor or developer, if a corporate entity, can only be paid with
leaseholds on portions of the reclaimed land. If the contractor or
developer is an individual, portions of the reclaimed land, not exceeding
12 hectares96 of non-agricultural lands, may be conveyed to him in
ownership in view of the legislative authority allowing such conveyance.
This is the only way these provisions of the BOT Law and the Local
Government Code can avoid a direct collision with Section 3, Article XII
of the 1987 Constitution.
Registration of lands of the public domain
Finally, PEA theorizes that the "act of conveying the ownership of the
reclaimed lands to public respondent PEA transformed such lands of
the public domain to private lands." This theory is echoed by AMARI
which maintains that the "issuance of the special patent leading to the
eventual issuance of title takes the subject land away from the land of
public domain and converts the property into patrimonial or private
property." In short, PEA and AMARI contend that with the issuance of
Special Patent No. 3517 and the corresponding certificates of titles, the
157.84 hectares comprising the Freedom Islands have become private
lands of PEA. In support of their theory, PEA and AMARI cite the
following rulings of the Court:
1. Sumail v. Judge of CFI of Cotabato,97 where the Court held
– by Commonwealth Act No. 141, as amended, there are
"Once the patent was granted and the corresponding
certificate of title was issued, the land ceased to be part of the
public domain and became private property over which the
Director of Lands has neither control nor jurisdiction."
2. Lee Hong Hok v. David,98 where the Court declared -
"After the registration and issuance of the certificate and
duplicate certificate of title based on a public land patent, the
land covered thereby automatically comes under the
operation of Republic Act 496 subject to all the safeguards
provided therein."3. Heirs of Gregorio Tengco v. Heirs of Jose
Aliwalas,99 where the Court ruled -
"While the Director of Lands has the power to review
homestead patents, he may do so only so long as the land
remains part of the public domain and continues to be under
his exclusive control; but once the patent is registered and a
certificate of title is issued, the land ceases to be part of the
public domain and becomes private property over which the
Director of Lands has neither control nor jurisdiction."
4. Manalo v. Intermediate Appellate Court,100 where the Court
held –
"When the lots in dispute were certified as disposable on May
19, 1971, and free patents were issued covering the same in
favor of the private respondents, the said lots ceased to be
part of the public domain and, therefore, the Director of Lands
lost jurisdiction over the same."
5.Republic v. Court of Appeals,101 where the Court stated –
"Proclamation No. 350, dated October 9, 1956, of President
Magsaysay legally effected a land grant to the Mindanao
Medical Center, Bureau of Medical Services, Department of
Health, of the whole lot, validly sufficient for initial registration
under the Land Registration Act. Such land grant is
constitutive of a 'fee simple' title or absolute title in favor of
petitioner Mindanao Medical Center. Thus, Section 122 of the
Act, which governs the registration of grants or patents
involving public lands, provides that 'Whenever public lands in
the Philippine Islands belonging to the Government of the
United States or to the Government of the Philippines are
alienated, granted or conveyed to persons or to public or
private corporations, the same shall be brought forthwith
under the operation of this Act (Land Registration Act, Act
496) and shall become registered lands.'"
The first four cases cited involve petitions to cancel the land patents
and the corresponding certificates of titles issued to private parties.
These four cases uniformly hold that the Director of Lands has no
jurisdiction over private lands or that upon issuance of the certificate of
title the land automatically comes under the Torrens System. The fifth
case cited involves the registration under the Torrens System of a 12.8-
hectare public land granted by the National Government to Mindanao
Medical Center, a government unit under the Department of Health.
The National Government transferred the 12.8-hectare public land to
serve as the site for the hospital buildings and other facilities of
Mindanao Medical Center, which performed a public service. The Court
affirmed the registration of the 12.8-hectare public land in the name of
Mindanao Medical Center under Section 122 of Act No. 496. This fifth
case is an example of a public land being registered under Act No. 496
without the land losing its character as a property of public dominion.
In the instant case, the only patent and certificates of title issued are
those in the name of PEA, a wholly government owned corporation
performing public as well as proprietary functions. No patent or
certificate of title has been issued to any private party. No one is asking
the Director of Lands to cancel PEA's patent or certificates of title. In
fact, the thrust of the instant petition is that PEA's certificates of title
should remain with PEA, and the land covered by these certificates,
being alienable lands of the public domain, should not be sold to a
private corporation.
Registration of land under Act No. 496 or PD No. 1529 does not vest in
the registrant private or public ownership of the land. Registration is not
a mode of acquiring ownership but is merely evidence of ownership
previously conferred by any of the recognized modes of acquiring
ownership. Registration does not give the registrant a better right than
what the registrant had prior to the registration. 102 The registration of
lands of the public domain under the Torrens system, by itself, cannot
convert public lands into private lands.103
Jurisprudence holding that upon the grant of the patent or issuance of
the certificate of title the alienable land of the public domain
automatically becomes private land cannot apply to government units
and entities like PEA. The transfer of the Freedom Islands to PEA was
made subject to the provisions of CA No. 141 as expressly stated in
Special Patent No. 3517 issued by then President Aquino, to wit:
"NOW, THEREFORE, KNOW YE, that by authority of the
Constitution of the Philippines and in conformity with the
provisions of Presidential Decree No. 1084, supplemented
hereby granted and conveyed unto the Public Estates
Authority the aforesaid tracts of land containing a total area of
one million nine hundred fifteen thousand eight hundred
ninety four (1,915,894) square meters; the technical
description of which are hereto attached and made an integral
part hereof." (Emphasis supplied)
Thus, the provisions of CA No. 141 apply to the Freedom Islands on
matters not covered by PD No. 1084. Section 60 of CA No. 141
prohibits, "except when authorized by Congress," the sale of alienable
lands of the public domain that are transferred to government units or
entities. Section 60 of CA No. 141 constitutes, under Section 44 of PD
No. 1529, a "statutory lien affecting title" of the registered land even if
not annotated on the certificate of title. 104 Alienable lands of the public
domain held by government entities under Section 60 of CA No. 141
remain public lands because they cannot be alienated or encumbered
unless Congress passes a law authorizing their disposition. Congress,
however, cannot authorize the sale to private corporations of reclaimed
alienable lands of the public domain because of the constitutional ban.
Only individuals can benefit from such law.
The grant of legislative authority to sell public lands in accordance with
Section 60 of CA No. 141 does not automatically convert alienable
lands of the public domain into private or patrimonial lands. The
alienable lands of the public domain must be transferred to qualified
private parties, or to government entities not tasked to dispose of public
lands, before these lands can become private or patrimonial lands.
Otherwise, the constitutional ban will become illusory if Congress can
declare lands of the public domain as private or patrimonial lands in the
hands of a government agency tasked to dispose of public lands. This
will allow private corporations to acquire directly from government
agencies limitless areas of lands which, prior to such law, are
concededly public lands.
Under EO No. 525, PEA became the central implementing agency of
the National Government to reclaim foreshore and submerged areas of
the public domain. Thus, EO No. 525 declares that –
"EXECUTIVE ORDER NO. 525
Designating the Public Estates Authority as the Agency
Primarily Responsible for all Reclamation Projects
Whereas, there are several reclamation projects which are
ongoing or being proposed to be undertaken in various parts
of the country which need to be evaluated for consistency with
national programs;
Whereas, there is a need to give further institutional support
to the Government's declared policy to provide for a
coordinated, economical and efficient reclamation of lands;
Whereas, Presidential Decree No. 3-A requires that all
reclamation of areas shall be limited to the National
Government or any person authorized by it under proper
contract;
Whereas, a central authority is needed to act on behalf of
the National Government which shall ensure a
coordinated and integrated approach in the reclamation
of lands;
Whereas, Presidential Decree No. 1084 creates the Public
Estates Authority as a government corporation to
undertake reclamation of lands and ensure their
maximum utilization in promoting public welfare and
interests; and
Whereas, Presidential Decree No. 1416 provides the
President with continuing authority to reorganize the national
government including the transfer, abolition, or merger of
functions and offices.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President
of the Philippines, by virtue of the powers vested in me by the
Constitution and pursuant to Presidential Decree No. 1416, do
hereby order and direct the following:
Section 1. The Public Estates Authority (PEA) shall be
primarily responsible for integrating, directing, and
coordinating all reclamation projects for and on behalf of
the National Government. All reclamation projects shall be
approved by the President upon recommendation of the PEA,
and shall be undertaken by the PEA or through a proper
contract executed by it with any person or entity; Provided,
that, reclamation projects of any national government agency
or entity authorized under its charter shall be undertaken in
consultation with the PEA upon approval of the President.
x x x ."
As the central implementing agency tasked to undertake reclamation
projects nationwide, with authority to sell reclaimed lands, PEA took the
place of DENR as the government agency charged with leasing or
selling reclaimed lands of the public domain. The reclaimed lands being
leased or sold by PEA are not private lands, in the same manner that
DENR, when it disposes of other alienable lands, does not dispose of
private lands but alienable lands of the public domain. Only when
qualified private parties acquire these lands will the lands become
private lands. In the hands of the government agency tasked and
authorized to dispose of alienable of disposable lands of the
public domain, these lands are still public, not private lands.
Furthermore, PEA's charter expressly states that PEA "shall hold
lands of the public domain" as well as "any and all kinds of lands."
PEA can hold both lands of the public domain and private lands. Thus,
the mere fact that alienable lands of the public domain like the Freedom
Islands are transferred to PEA and issued land patents or certificates of
title in PEA's name does not automatically make such lands private.
To allow vast areas of reclaimed lands of the public domain to be
transferred to PEA as private lands will sanction a gross violation of the
constitutional ban on private corporations from acquiring any kind of
alienable land of the public domain. PEA will simply turn around, as
PEA has now done under the Amended JVA, and transfer several
hundreds of hectares of these reclaimed and still to be reclaimed lands
to a single private corporation in only one transaction. This scheme will
effectively nullify the constitutional ban in Section 3, Article XII of the
1987 Constitution which was intended to diffuse equitably the
ownership of alienable lands of the public domain among Filipinos, now
numbering over 80 million strong.
This scheme, if allowed, can even be applied to alienable agricultural
lands of the public domain since PEA can "acquire x x x any and all
kinds of lands." This will open the floodgates to corporations and even
individuals acquiring hundreds of hectares of alienable lands of the
public domain under the guise that in the hands of PEA these lands are
private lands. This will result in corporations amassing huge
landholdings never before seen in this country - creating the very evil
that the constitutional ban was designed to prevent. This will completely
reverse the clear direction of constitutional development in this country.
The 1935 Constitution allowed private corporations to acquire not more
than 1,024 hectares of public lands. 105 The 1973 Constitution prohibited
private corporations from acquiring any kind of public land, and the
1987 Constitution has unequivocally reiterated this prohibition.
The contention of PEA and AMARI that public lands, once registered
under Act No. 496 or PD No. 1529, automatically become private lands
is contrary to existing laws. Several laws authorize lands of the public
domain to be registered under the Torrens System or Act No. 496, now
PD No. 1529, without losing their character as public lands. Section 122
of Act No. 496, and Section 103 of PD No. 1529, respectively, provide
as follows:
Act No. 496
"Sec. 122. Whenever public lands in the Philippine Islands
belonging to the x x x Government of the Philippine Islands
are alienated, granted, or conveyed to persons or the public
or private corporations, the same shall be brought forthwith
under the operation of this Act and shall become registered
lands."
PD No. 1529
"Sec. 103. Certificate of Title to Patents. Whenever public
land is by the Government alienated, granted or conveyed to
any person, the same shall be brought forthwith under the
operation of this Decree." (Emphasis supplied)
Based on its legislative history, the phrase "conveyed to any person" in
Section 103 of PD No. 1529 includes conveyances of public lands to
public corporations.
Alienable lands of the public domain "granted, donated, or transferred
to a province, municipality, or branch or subdivision of the
Government," as provided in Section 60 of CA No. 141, may be
registered under the Torrens System pursuant to Section 103 of PD No.
1529. Such registration, however, is expressly subject to the condition
in Section 60 of CA No. 141 that the land "shall not be alienated,
encumbered or otherwise disposed of in a manner affecting its title,
except when authorized by Congress." This provision refers to
government reclaimed, foreshore and marshy lands of the public
domain that have been titled but still cannot be alienated or
encumbered unless expressly authorized by Congress. The need for
legislative authority prevents the registered land of the public domain
from becoming private land that can be disposed of to qualified private
parties.
The Revised Administrative Code of 1987 also recognizes that lands of
the public domain may be registered under the Torrens System.
Section 48, Chapter 12, Book I of the Code states –
"Sec. 48. Official Authorized to Convey Real Property.
Whenever real property of the Government is authorized by
law to be conveyed, the deed of conveyance shall be
executed in behalf of the government by the following:
(1) x x x
(2) For property belonging to the Republic of the
Philippines, but titled in the name of any political
subdivision or of any corporate agency or
instrumentality, by the executive head of the agency or
instrumentality." (Emphasis supplied)
Thus, private property purchased by the National Government for
expansion of a public wharf may be titled in the name of a government
corporation regulating port operations in the country. Private property
purchased by the National Government for expansion of an airport may
also be titled in the name of the government agency tasked to
administer the airport. Private property donated to a municipality for use
as a town plaza or public school site may likewise be titled in the name
of the municipality.106 All these properties become properties of the submerged areas are inalienable and outside the
public domain, and if already registered under Act No. 496 or PD No. commerce of man.
1529, remain registered land. There is no requirement or provision in 3. Since the Amended JVA seeks to transfer to AMARI, a
any existing law for the de-registration of land from the Torrens System. private corporation, ownership of 77.34 hectares 110 of the
Private lands taken by the Government for public use under its power of Freedom Islands, such transfer is void for being contrary to
eminent domain become unquestionably part of the public domain. Section 3, Article XII of the 1987 Constitution which prohibits
Nevertheless, Section 85 of PD No. 1529 authorizes the Register of private corporations from acquiring any kind of alienable land
Deeds to issue in the name of the National Government new of the public domain.
certificates of title covering such expropriated lands. Section 85 of PD 4. Since the Amended JVA also seeks to transfer to AMARI
No. 1529 states – ownership of 290.156 hectares111 of still submerged areas of
"Sec. 85. Land taken by eminent domain. Whenever any Manila Bay, such transfer is void for being contrary to Section
registered land, or interest therein, is expropriated or taken by 2, Article XII of the 1987 Constitution which prohibits the
eminent domain, the National Government, province, city or alienation of natural resources other than agricultural lands of
municipality, or any other agency or instrumentality exercising the public domain. PEA may reclaim these submerged areas.
such right shall file for registration in the proper Registry a Thereafter, the government can classify the reclaimed lands
certified copy of the judgment which shall state definitely by as alienable or disposable, and further declare them no longer
an adequate description, the particular property or interest needed for public service. Still, the transfer of such reclaimed
expropriated, the number of the certificate of title, and the alienable lands of the public domain to AMARI will be void in
nature of the public use. A memorandum of the right or view of Section 3, Article XII of the 1987 Constitution which
interest taken shall be made on each certificate of title by the prohibits private corporations from acquiring any kind of
Register of Deeds, and where the fee simple is taken, a new alienable land of the public domain.
certificate shall be issued in favor of the National Clearly, the Amended JVA violates glaringly Sections 2 and 3, Article
Government, province, city, municipality, or any other XII of the 1987 Constitution. Under Article 1409 112 of the Civil Code,
agency or instrumentality exercising such right for the land so contracts whose "object or purpose is contrary to law," or whose "object
taken. The legal expenses incident to the memorandum of is outside the commerce of men," are "inexistent and void from the
registration or issuance of a new certificate of title shall be for beginning." The Court must perform its duty to defend and uphold the
the account of the authority taking the land or interest therein." Constitution, and therefore declares the Amended JVA null and void
(Emphasis supplied) ab initio.
Consequently, lands registered under Act No. 496 or PD No. 1529 are Seventh issue: whether the Court is the proper forum to raise the
not exclusively private or patrimonial lands. Lands of the public domain issue of whether the Amended JVA is grossly disadvantageous to
may also be registered pursuant to existing laws. the government.
AMARI makes a parting shot that the Amended JVA is not a sale to Considering that the Amended JVA is null and void ab initio, there is no
AMARI of the Freedom Islands or of the lands to be reclaimed from necessity to rule on this last issue. Besides, the Court is not a trier of
submerged areas of Manila Bay. In the words of AMARI, the Amended facts, and this last issue involves a determination of factual matters.
JVA "is not a sale but a joint venture with a stipulation for
WHEREFORE, the petition is GRANTED. The Public Estates Authority
reimbursement of the original cost incurred by PEA for the earlier
and Amari Coastal Bay Development Corporation are PERMANENTLY
reclamation and construction works performed by the CDCP under its
ENJOINED from implementing the Amended Joint Venture Agreement
1973 contract with the Republic." Whether the Amended JVA is a sale
which is hereby declared NULL and VOID ab initio.
or a joint venture, the fact remains that the Amended JVA requires PEA
to "cause the issuance and delivery of the certificates of title conveying SO ORDERED.
AMARI's Land Share in the name of AMARI."107
This stipulation still contravenes Section 3, Article XII of the 1987
Constitution which provides that private corporations "shall not hold
such alienable lands of the public domain except by lease." The
transfer of title and ownership to AMARI clearly means that AMARI will
"hold" the reclaimed lands other than by lease. The transfer of title and
ownership is a "disposition" of the reclaimed lands, a transaction
considered a sale or alienation under CA No. 141,108 the Government
Auditing Code,109 and Section 3, Article XII of the 1987 Constitution.
The Regalian doctrine is deeply implanted in our legal system.
Foreshore and submerged areas form part of the public domain and are
inalienable. Lands reclaimed from foreshore and submerged areas also
form part of the public domain and are also inalienable, unless
converted pursuant to law into alienable or disposable lands of the
public domain. Historically, lands reclaimed by the government are sui
generis, not available for sale to private parties unlike other alienable
public lands. Reclaimed lands retain their inherent potential as areas for
public use or public service. Alienable lands of the public domain,
increasingly becoming scarce natural resources, are to be distributed
equitably among our ever-growing population. To insure such equitable
distribution, the 1973 and 1987 Constitutions have barred private
corporations from acquiring any kind of alienable land of the public
domain. Those who attempt to dispose of inalienable natural resources
of the State, or seek to circumvent the constitutional ban on alienation
of lands of the public domain to private corporations, do so at their own
risk.
We can now summarize our conclusions as follows:
1. The 157.84 hectares of reclaimed lands comprising the
Freedom Islands, now covered by certificates of title in the
name of PEA, are alienable lands of the public domain.
PEA may lease these lands to private corporations but may
not sell or transfer ownership of these lands to private
corporations. PEA may only sell these lands to Philippine
citizens, subject to the ownership limitations in the 1987
Constitution and existing laws.
2. The 592.15 hectares of submerged areas of Manila Bay
remain inalienable natural resources of the public domain until
classified as alienable or disposable lands open to disposition
and declared no longer needed for public service. The
government can make such classification and declaration only
after PEA has reclaimed these submerged areas. Only then
can these lands qualify as agricultural lands of the public
domain, which are the only natural resources the government
can alienate. In their present state, the 592.15 hectares of
G.R. No. 115381 December 23, 1994 on many provincial routes. It is in this context that
KILUSANG MAYO UNO LABOR CENTER, petitioner, some form of liberalization on public transport fares
vs. is to be tested on a pilot basis.
HON. JESUS B. GARCIA, JR., the LAND TRANSPORTATION In view thereof, the LTFRB is hereby directed to
FRANCHISING AND REGULATORY BOARD, and the PROVINCIAL immediately publicize a fare range scheme for all
BUS OPERATORS ASSOCIATION OF THE PHILIPPINES, provincial bus routes in country (except those
respondents. operating within Metro Manila). Transport Operators
Potenciano A. Flores for petitioner. shall be allowed to charge passengers within a
range of fifteen percent (15%) above and fifteen
Robert Anthony C. Sison, Cesar B. Brillantes and Jose Z. Galsim for
percent (15%) below the LTFRB official rate for a
private respondent.
period of one year.
Jose F. Miravite for movants.
Guidelines and procedures for the said scheme shall
be prepared by LTFRB in coordination with the
KAPUNAN, J.: DOTC Planning Service.
Public utilities are privately owned and operated businesses whose The implementation of the said fare range scheme
service are essential to the general public. They are enterprises which shall start on 6 August 1990.
specially cater to the needs of the public and conduce to their comfort For compliance. (Emphasis ours.)
and convenience. As such, public utility services are impressed with
Finding the implementation of the fare range scheme "not legally
public interest and concern. The same is true with respect to the
feasible," Remedios A.S. Fernando submitted the following
business of common carrier which holds such a peculiar relation to the
memorandum to Oscar M. Orbos on July 24, 1990, to wit:
public interest that there is superinduced upon it the right of public
regulation when private properties are affected with public interest, With reference to DOTC Memorandum Order No.
hence, they cease to be juris privati only. When, therefore, one devotes 90-395 dated 26 June 1990 which the LTFRB
his property to a use in which the public has an interest, he, in effect received on 19 July 1990, directing the Board "to
grants to the public an interest in that use, and must submit to the immediately publicize a fare range scheme for all
control by the public for the common good, to the extent of the interest provincial bus routes in the country (except those
he has thus created.1 operating within Metro Manila)" that will allow
operators "to charge passengers within a range of
An abdication of the licensing and regulatory government agencies of
fifteen percent (15%) above and fifteen percent
their functions as the instant petition seeks to show, is indeed
(15%) below the LTFRB official rate for a period of
lamentable. Not only is it an unsound administrative policy but it is
one year" the undersigned is respectfully adverting
inimical to public trust and public interest as well.
the Secretary's attention to the following for his
The instant petition for certiorari assails the constitutionality and validity consideration:
of certain memoranda, circulars and/or orders of the Department of
1. Section 16(c) of the Public
Transportation and Communications (DOTC) and the Land
Service Act prescribes the
Transportation Franchising and Regulatory Board LTFRB)2 which,
following for the fixing and
among others, (a) authorize provincial bus and jeepney operators to
determination of rates — (a) the
increase or decrease the prescribed transportation fares without
rates to be approved should be
application therefor with the LTFRB and without hearing and approval
proposed by public service
thereof by said agency in violation of Sec. 16(c) of Commonwealth Act
operators; (b) there should be a
No. 146, as amended, otherwise known as the Public Service Act, and
publication and notice to
in derogation of LTFRB's duty to fix and determine just and reasonable
concerned or affected parties in
fares by delegating that function to bus operators, and (b) establish a
the territory affected; (c) a public
presumption of public need in favor of applicants for certificates of
hearing should be held for the
public convenience (CPC) and place on the oppositor the burden of
fixing of the rates; hence,
proving that there is no need for the proposed service, in patent
implementation of the proposed
violation not only of Sec. 16(c) of CA 146, as amended, but also of Sec.
fare range scheme on August 6
20(a) of the same Act mandating that fares should be "just and
without complying with the
reasonable." It is, likewise, violative of the Rules of Court which places
requirements of the Public
upon each party the burden to prove his own affirmative allegations.3
Service Act may not be legally
The offending provisions contained in the questioned issuances pointed
feasible.
out by petitioner, have resulted in the introduction into our highways
and thoroughfares thousands of old and smoke-belching buses, many 2. To allow bus operators in the
of which are right-hand driven, and have exposed our consumers to the country to charge fares fifteen
burden of spiraling costs of public transportation without hearing and (15%) above the present LTFRB
due process. fares in the wake of the
devastation, death and suffering
The following memoranda, circulars and/or orders are sought to be
caused by the July 16
nullified by the instant petition, viz: (a) DOTC Memorandum Order 90-
earthquake will not be socially
395, dated June 26, 1990 relative to the implementation of a fare range
warranted and will be politically
scheme for provincial bus services in the country; (b) DOTC
unsound; most likely public
Department Order No.
criticism against the DOTC and
92-587, dated March 30, 1992, defining the policy framework on the
the LTFRB will be triggered by
regulation of transport services; (c) DOTC Memorandum dated October
the untimely motu propio
8, 1992, laying down rules and procedures to implement Department
implementation of the proposal
Order No. 92-587; (d) LTFRB Memorandum Circular No. 92-009,
by the mere expedient of
providing implementing guidelines on the DOTC Department Order No.
publicizing the fare range
92-587; and (e) LTFRB Order dated March 24, 1994 in Case No. 94-
scheme without calling a public
3112.
hearing, which scheme many as
The relevant antecedents are as follows: early as during the Secretary's
On June 26, 1990; then Secretary of DOTC, Oscar M. Orbos, issued predecessor know through
Memorandum Circular No. 90-395 to then LTFRB Chairman, Remedios newspaper reports and
A.S. Fernando allowing provincial bus operators to charge passengers columnists' comments to be
rates within a range of 15% above and 15% below the LTFRB official Asian Development Bank and
rate for a period of one (1) year. The text of the memorandum order World Bank inspired.
reads in full: 3. More than inducing a
One of the policy reforms and measures that is in reduction in bus fares by fifteen
line with the thrusts and the priorities set out in the percent (15%) the
Medium-Term Philippine Development Plan implementation of the proposal
(MTPDP) 1987 — 1992) is the liberalization of will instead trigger an upward
regulations in the transport sector. Along this line, adjustment in bus fares by fifteen
the Government intends to move away gradually percent (15%) at a time when
from regulatory policies and make progress towards hundreds of thousands of people
greater reliance on free market forces. in Central and Northern Luzon,
Based on several surveys and observations, bus particularly in Central
companies are already charging passenger rates Pangasinan, La Union, Baguio
above and below the official fare declared by LTFRB City, Nueva Ecija, and the
 Cagayan Valley are suffering
from the devastation and havoc
caused by the recent
earthquake.
4. In lieu of the said proposal, the
DOTC with its agencies involved
in public transportation can
consider measures and reforms
in the industry that will be socially
uplifting, especially for the people
in the areas devastated by the
recent earthquake.
In view of the foregoing considerations, the
undersigned respectfully suggests that the
implementation of the proposed fare range scheme
this year be further studied and evaluated.
On December 5, 1990, private respondent Provincial Bus Operators
Association of the Philippines, Inc. (PBOAP) filed an application for fare
rate increase. An across-the-board increase of eight and a half
centavos (P0.085) per kilometer for all types of provincial buses with a
minimum-maximum fare range of fifteen (15%) percent over and below
the proposed basic per kilometer fare rate, with the said minimum-
maximum fare range applying only to ordinary, first class and premium
class buses and a fifty-centavo (P0.50) minimum per kilometer fare for
aircon buses, was sought.
On December 6, 1990, private respondent PBOAP reduced its applied
proposed fare to an across-the-board increase of six and a half
(P0.065) centavos per kilometer for ordinary buses. The decrease was
due to the drop in the expected price of diesel.
The application was opposed by the Philippine Consumers Foundation,
Inc. and Perla C. Bautista alleging that the proposed rates were
exorbitant and unreasonable and that the application contained no
allegation on the rate of return of the proposed increase in rates.
On December 14, 1990, public respondent LTFRB rendered a decision
granting the fare rate increase in accordance with the following
schedule of fares on a straight computation method, viz:
AUTHORIZED FARES
LUZON
MIN. OF 5 KMS. SUCCEEDING KM.
REGULAR P1.50 P0.37
STUDENT P1.15 P0.28
VISAYAS/MINDANAO
REGULAR P1.60 P0.375
STUDENT P1.20 P0.285
FIRST CLASS (PER KM.)
LUZON P0.385
VISAYAS/
MINDANAO P0.395
PREMIERE CLASS (PER KM.)
LUZON P0.395
VISAYAS/
MINDANAO P0.405
AIRCON (PER KM.) P0.415.4
On March 30, 1992, then Secretary of the Department of Transportation
and Communications Pete Nicomedes Prado issued Department Order
No.
92-587 defining the policy framework on the regulation of transport
services. The full text of the said order is reproduced below in view of
the importance of the provisions contained therein:
WHEREAS, Executive Order No. 125 as amended,
designates the Department of Transportation and
Communications (DOTC) as the primary policy,
planning, regulating and implementing agency on
transportation;
WHEREAS, to achieve the objective of a viable,
efficient, and dependable transportation system, the
transportation regulatory agencies under or attached
to the DOTC have to harmonize their decisions and
adopt a common philosophy and direction;
WHEREAS, the government proposes to build on
the successful liberalization measures pursued over
the last five years and bring the transport sector
nearer to a balanced longer term regulatory
framework;
NOW, THEREFORE, pursuant to the powers
granted by laws to the DOTC, the following policies
and principles in the economic regulation of land,
air, and water transportation services are hereby
adopted:
1. Entry into and exit out of the industry. Following
the Constitutional dictum against monopoly, no
franchise holder shall be permitted to maintain a
monopoly on any route. A minimum of two franchise
holders shall be permitted to operate on any route.
The requirements to grant a certificate to operate, or
certificate of public convenience, shall be: proof of
Filipino citizenship, financial capability, public need,
and sufficient insurance cover to protect the riding
public.
In determining public need, the presumption of need
for a service shall be deemed in favor of the
applicant. The burden of proving that there is no
need for a proposed service shall be with the
oppositor(s).
In the interest of providing efficient public transport
services, the use of the "prior operator" and the
"priority of filing" rules shall be discontinued. The
route measured capacity test or other similar tests of
demand for vehicle/vessel fleet on any route shall be
used only as a guide in weighing the merits of each
franchise application and not as a limit to the
services offered.
Where there are limitations in facilities, such as
congested road space in urban areas, or at airports
and ports, the use of demand management
measures in conformity with market principles may
be considered.
The right of an operator to leave the industry is
recognized as a business decision, subject only to
the filing of appropriate notice and following a
phase-out period, to inform the public and to
minimize disruption of services.
2. Rate and Fare Setting. Freight rates shall be
freed gradually from government controls.
Passenger fares shall also be deregulated, except
for the lowest class of passenger service (normally
third class passenger transport) for which the
government will fix indicative or reference fares.
Operators of particular services may fix their own
fares within a range 15% above and below the
indicative or reference rate.
Where there is lack of effective competition for
services, or on specific routes, or for the transport of
particular commodities, maximum mandatory freight
rates or passenger fares shall be set temporarily by
the government pending actions to increase the
level of competition.
For unserved or single operator routes, the
government shall contract such services in the most
advantageous terms to the public and the
government, following public bids for the services.
The advisability of bidding out the services or using
other kinds of incentives on such routes shall be
studied by the government.
3. Special Incentives and Financing for Fleet
Acquisition. As a matter of policy, the government
shall not engage in special financing and incentive
programs, including direct subsidies for fleet
acquisition and expansion. Only when the market
situation warrants government intervention shall
programs of this type be considered. Existing
programs shall be phased out gradually.
The Land Transportation Franchising and
Regulatory Board, the Civil Aeronautics Board, the
Maritime Industry Authority are hereby directed to
submit to the Office of the Secretary, within forty-five
(45) days of this Order, the detailed rules and
procedures for the Implementation of the policies
herein set forth. In the formulation of such rules, the
concerned agencies shall be guided by the most
recent studies on the subjects, such as the
Provincial Road Passenger Transport Study, the
Civil Aviation Master Plan, the Presidential Task
Force on the Inter-island Shipping Industry, and the
Inter-island Liner Shipping Rate Rationalization
Study.
For the compliance of all concerned. (Emphasis
ours)
On October 8, 1992, public respondent Secretary of the Department of
Transportation and Communications Jesus B. Garcia, Jr. issued a
memorandum to the Acting Chairman of the LTFRB suggesting swift
action on the adoption of rules and procedures to implement above-
quoted Department Order No. 92-587 that laid down deregulation and
other liberalization policies for the transport sector. Attached to the said
memorandum was a revised draft of the required rules and procedures
covering (i) Entry Into and Exit Out of the Industry and (ii) Rate and
Fare Setting, with comments and suggestions from the World Bank
incorporated therein. Likewise, resplendent from the said memorandum
is the statement of the DOTC Secretary that the adoption of the rules
and procedures is a pre-requisite to the approval of the Economic
Integration Loan from the World Bank.5
On February 17, 1993, the LTFRB issued Memorandum Circular
No. 92-009 promulgating the guidelines for the implementation of
DOTC Department Order No. 92-587. The Circular provides, among
others, the following challenged portions:
xxx xxx xxx
IV. Policy Guidelines on the Issuance of Certificate
of Public Convenience.
The issuance of a Certificate of Public Convenience
is determined by public need. The presumption of
public need for a service shall be deemed in favor of
the applicant, while burden of proving that there is
no need for the proposed service shall be the
oppositor'(s).
xxx xxx xxx
V. Rate and Fare Setting
The control in pricing shall be liberalized to introduce
price competition complementary with the quality of
service, subject to prior notice and public hearing.
Fares shall not be provisionally authorized without
public hearing.
A. On the General Structure of Rates
1. The existing authorized fare range system of plus
or minus 15 per cent for provincial buses and
jeepneys shall be widened to 20% and -25% limit in
1994 with the authorized fare to be replaced by an
indicative or reference rate as the basis for the
expanded fare range.
2. Fare systems for aircon buses are liberalized to
cover first class and premier services.
xxx xxx xxx
(Emphasis ours).
Sometime in March, 1994, private respondent PBOAP, availing itself of
the deregulation policy of the DOTC allowing provincial bus operators
to collect plus 20% and minus 25% of the prescribed fare without first
having filed a petition for the purpose and without the benefit of a public
hearing, announced a fare increase of twenty (20%) percent of the
existing fares. Said increased fares were to be made effective on March
16, 1994.
On March 16, 1994, petitioner KMU filed a petition before the LTFRB
opposing the upward adjustment of bus fares.
On March 24, 1994, the LTFRB issued one of the assailed orders
dismissing the petition for lack of merit. The dispositive portion reads:
PREMISES CONSIDERED, this Board after
considering the arguments of the parties, hereby
DISMISSES FOR LACK OF MERIT the petition filed
in the above-entitled case. This petition in this case
was resolved with dispatch at the request of
petitioner to enable it to immediately avail of the
legal remedies or options it is entitled under existing
laws.
SO ORDERED.6
Hence, the instant petition for certiorari with an urgent prayer for
issuance of a temporary restraining order.
The Court, on June 20, 1994, issued a temporary restraining order
enjoining, prohibiting and preventing respondents from implementing
the bus fare rate increase as well as the questioned orders and
memorandum circulars. This meant that provincial bus fares were rolled
back to the levels duly authorized by the LTFRB prior to March 16,
1994. A moratorium was likewise enforced on the issuance of
franchises for the operation of buses, jeepneys, and taxicabs.
Petitioner KMU anchors its claim on two (2) grounds. First, the authority
given by respondent LTFRB to provincial bus operators to set a fare
range of plus or minus fifteen (15%) percent, later increased to plus
twenty (20%) and minus twenty-five (-25%) percent, over and above
the existing authorized fare without having to file a petition for the
purpose, is unconstitutional, invalid and illegal. Second, the
establishment of a presumption of public need in favor of an applicant
for a proposed transport service without having to prove public
necessity, is illegal for being violative of the Public Service Act and the
Rules of Court.
In its Comment, private respondent PBOAP, while not actually touching
upon the issues raised by the petitioner, questions the wisdom and the
manner by which the instant petition was filed. It asserts that the
petitioner has no legal standing to sue or has no real interest in the
case at bench and in obtaining the reliefs prayed for.
In their Comment filed by the Office of the Solicitor General, public
respondents DOTC Secretary Jesus B. Garcia, Jr. and the LTFRB
asseverate that the petitioner does not have the standing to maintain
the instant suit. They further claim that it is within DOTC and LTFRB's
authority to set a fare range scheme and establish a presumption of
public need in applications for certificates of public convenience.
We find the instant petition impressed with merit.
At the outset, the threshold issue of locus standi must be struck.
Petitioner KMU has the standing to sue.
The requirement of locus standi inheres from the definition of judicial
power. Section 1 of Article VIII of the Constitution provides:
xxx xxx xxx
Judicial power includes the duty of the courts of
justice to settle actual controversies involving rights
which are legally demandable and enforceable, and
to determine whether or not there has been a grave
abuse of discretion amounting to lack or excess of
jurisdiction on the part of any branch or
instrumentality of the Government.
In Lamb v. Phipps,7 we ruled that judicial power is the power to hear
and decide causes pending between parties who have the right to sue
in the courts of law and equity. Corollary to this provision is the principle
of locus standi of a party litigant. One who is directly affected by and
whose interest is immediate and substantial in the controversy has the
standing to sue. The rule therefore requires that a party must show a
personal stake in the outcome of the case or an injury to himself that
can be redressed by a favorable decision so as to warrant an
invocation of the court's jurisdiction and to justify the exercise of the
court's remedial powers in his behalf.8
In the case at bench, petitioner, whose members had suffered and
continue to suffer grave and irreparable injury and damage from the
implementation of the questioned memoranda, circulars and/or orders,
has shown that it has a clear legal right that was violated and continues
to be violated with the enforcement of the challenged memoranda,
circulars and/or orders. KMU members, who avail of the use of buses,
trains and jeepneys everyday, are directly affected by the burdensome
cost of arbitrary increase in passenger fares. They are part of the
millions of commuters who comprise the riding public. Certainly, their
rights must be protected, not neglected nor ignored.
Assuming arguendo that petitioner is not possessed of the standing to
sue, this court is ready to brush aside this barren procedural infirmity
and recognize the legal standing of the petitioner in view of the
transcendental importance of the issues raised. And this act of liberality
is not without judicial precedent. As early as the Emergency Powers
Cases, this Court had exercised its discretion and waived the
requirement of proper party. In the recent case of Kilosbayan, Inc., et
al. v. Teofisto Guingona, Jr., et al.,9 we ruled in the same lines and
enumerated some of the cases where the same policy was adopted,
viz:
. . . A party's standing before this Court is a
procedural technicality which it may, in the exercise
of its discretion, set aside in view of the importance
of the issues raised. In the landmark Emergency
Powers Cases, [G.R. No. L-2044 (Araneta v.
Dinglasan); G.R. No. L-2756 (Araneta
v. Angeles); G.R. No. L-3054 (Rodriguez v.
Tesorero de Filipinas); G.R. No. L-3055 (Guerrero v.
Commissioner of Customs); and G.R. No. L-3056
(Barredo v. Commission on Elections), 84 Phil. 368
(1949)], this Court brushed aside this technicality
because "the transcendental importance to the
public of these cases demands that they be settled
promptly and definitely, brushing aside, if we must,
technicalities of procedure. (Avelino vs. Cuenco,
G.R. No. L-2621)." Insofar as taxpayers' suits are
concerned, this Court had declared that it "is not
devoid of discretion as to whether or not it should be
entertained," (Tan v. Macapagal, 43 SCRA 677, 680
[1972]) or that it "enjoys an open discretion to
entertain the same or not." [Sanidad v. COMELEC,
73 SCRA 333 (1976)].
xxx xxx xxx
In line with the liberal policy of this Court on locus
standi, ordinary taxpayers, members of Congress,
and even association of planters, and
non-profit civic organizations were allowed to initiate
and prosecute actions before this court to question
the constitutionality or validity of laws, acts,
decisions, rulings, or orders of various government
agencies or instrumentalities. Among such cases
were those assailing the constitutionality of (a) R.A.
No. 3836 insofar as it allows retirement gratuity and
commutation of vacation and sick leave to Senators
and Representatives and to elective officials of both
Houses of Congress (Philippine Constitution
Association, Inc. v. Gimenez, 15 SCRA 479 [1965]);
 (b) Executive Order No. 284, issued by President
Corazon C. Aquino on 25 July 1987, which allowed
members of the cabinet, their undersecretaries, and
assistant secretaries to hold other government
offices or positions (Civil Liberties Union v.
Executive Secretary, 194 SCRA 317 [1991]); (c) the
automatic appropriation for debt service in the
General Appropriations Act (Guingona v. Carague,
196 SCRA 221 [1991]; (d) R.A. No. 7056 on the
holding of desynchronized elections (Osmeña v.
Commission on Elections, 199 SCRA 750 [1991]);
(e) P.D. No. 1869 (the charter of the Philippine
Amusement and Gaming Corporation) on the
ground that it is contrary to morals, public policy,
and order (Basco v. Philippine Amusement and
Gaming Corp., 197 SCRA 52 [1991]); and (f) R.A.
No. 6975, establishing the Philippine National
Police. (Carpio v. Executive Secretary, 206 SCRA
290 [1992]).
Other cases where we have followed a liberal policy
regarding locus standi include those attacking the
validity or legality of (a) an order allowing the
importation of rice in the light of the prohibition
imposed by R.A. No. 3452 (Iloilo Palay and Corn
Planters Association, Inc. v. Feliciano, 13 SCRA 377
[1965]; (b) P.D. Nos. 991 and 1033 insofar as they
proposed amendments to the Constitution and P.D.
No. 1031 insofar as it directed the COMELEC to
supervise, control, hold, and conduct the
referendum-plebiscite on 16 October 1976 (Sanidad
v. Commission on Elections, supra); (c) the bidding
for the sale of the 3,179 square meters of land at
Roppongi, Minato-ku, Tokyo, Japan (Laurel v.
Garcia, 187 SCRA 797 [1990]); (d) the approval
without hearing by the Board of Investments of the
amended application of the Bataan Petrochemical
Corporation to transfer the site of its plant from
Bataan to Batangas and the validity of such transfer
and the shift of feedstock from naphtha only to
naphtha and/or liquefied petroleum gas (Garcia v.
Board of Investments, 177 SCRA 374 [1989]; Garcia
v. Board of Investments, 191 SCRA 288 [1990]); (e)
the decisions, orders, rulings, and resolutions of the
Executive Secretary, Secretary of Finance,
Commissioner of Internal Revenue, Commissioner
of Customs, and the Fiscal Incentives Review Board
exempting the National Power Corporation from
indirect tax and duties (Maceda v. Macaraig, 197
SCRA 771 [1991]); (f) the orders of the Energy
Regulatory Board of 5 and 6 December 1990 on the
ground that the hearings conducted on the second
provisional increase in oil prices did not allow the
petitioner substantial cross-examination; (Maceda v.
Energy Regulatory Board, 199 SCRA 454 [1991]);
(g) Executive Order No. 478 which levied a special
duty of P0.95 per liter of imported oil products
(Garcia v. Executive Secretary, 211 SCRA 219
[1992]); (h) resolutions of the Commission on
Elections concerning the apportionment, by district,
of the number of elective members of Sanggunians
(De Guia vs. Commission on Elections, 208 SCRA
420 [1992]); and (i) memorandum orders issued by
a Mayor affecting the Chief of Police of Pasay City
(Pasay Law and Conscience Union, Inc. v. Cuneta,
101 SCRA 662 [1980]).
In the 1975 case of Aquino v. Commission on
Elections (62 SCRA 275 [1975]), this Court, despite
its unequivocal ruling that the petitioners therein had
no personality to file the petition, resolved
nevertheless to pass upon the issues raised
because of the far-reaching implications of the
petition. We did no less in De Guia v. COMELEC
(Supra) where, although we declared that De Guia
"does not appear to have locus standi, a standing in
law, a personal or substantial interest," we brushed
aside the procedural infirmity "considering the
importance of the issue involved, concerning as it
does the political exercise of qualified voters
affected by the apportionment, and petitioner
alleging abuse of discretion and violation of the
Constitution by respondent."
Now on the merits of the case.
On the fare range scheme.
Section 16(c) of the Public Service Act, as amended, reads:
Sec. 16. Proceedings of the Commission, upon
notice and hearing. — The Commission shall have
power, upon proper notice and hearing in
accordance with the rules and provisions of this Act,
subject to the limitations and exceptions mentioned
and saving provisions to the contrary:
xxx xxx xxx
(c) To fix and determine individual or joint rates,
tolls, charges, classifications, or schedules thereof,
as well as commutation, mileage kilometrage, and
other special rates which shall be imposed,
observed, and followed thereafter by any public
service: Provided, That the Commission may, in its
discretion, approve rates proposed by public
services provisionally and without necessity of any
hearing; but it shall call a hearing thereon within
thirty days thereafter, upon publication and notice to
the concerns operating in the territory affected:
Provided, further, That in case the public service
equipment of an operator is used principally or
secondarily for the promotion of a private business,
the net profits of said private business shall be
considered in relation with the public service of such
operator for the purpose of fixing the rates.
(Emphasis ours).
xxx xxx xxx
Under the foregoing provision, the Legislature delegated to
the defunct Public Service Commission the power of fixing the
rates of public services. Respondent LTFRB, the existing
regulatory body today, is likewise vested with the same under
Executive Order No. 202 dated June 19, 1987. Section 5(c) of
the said executive order authorizes LTFRB "to determine,
prescribe, approve and periodically review and adjust,
reasonable fares, rates and other related charges, relative to
the operation of public land transportation services provided
by motorized vehicles."
Such delegation of legislative power to an administrative agency is
permitted in order to adapt to the increasing complexity of modern life.
As subjects for governmental regulation multiply, so does the difficulty
of administering the laws. Hence, specialization even in legislation has
become necessary. Given the task of determining sensitive and
delicate matters as
route-fixing and rate-making for the transport sector, the responsible
regulatory body is entrusted with the power of subordinate legislation.
With this authority, an administrative body and in this case, the LTFRB,
may implement broad policies laid down in a statute by "filling in" the
details which the Legislature may neither have time or competence to
provide. However, nowhere under the aforesaid provisions of law are
the regulatory bodies, the PSC and LTFRB alike, authorized to
delegate that power to a common carrier, a transport operator, or other
public service.
In the case at bench, the authority given by the LTFRB to the provincial
bus operators to set a fare range over and above the authorized
existing fare, is illegal and invalid as it is tantamount to an undue
delegation of legislative authority. Potestas delegata non delegari
potest. What has been delegated cannot be delegated. This doctrine is
based on the ethical principle that such a delegated power constitutes
not only a right but a duty to be performed by the delegate through the
instrumentality of his own judgment and not through the intervening
mind of another.10 A further delegation of such power would indeed
constitute a negation of the duty in violation of the trust reposed in the
delegate mandated to discharge it directly.11 The policy of allowing the
provincial bus operators to change and increase their fares at will would
result not only to a chaotic situation but to an anarchic state of affairs.
This would leave the riding public at the mercy of transport operators
who may increase fares every hour, every day, every month or every
year, whenever it pleases them or whenever they deem it "necessary"
to do so. In Panay Autobus Co. v. Philippine Railway Co.,12 where
respondent Philippine Railway Co. was granted by the Public Service
Commission the authority to change its freight rates at will, this Court
categorically declared that:
In our opinion, the Public Service Commission was
not authorized by law to delegate to the Philippine
Railway Co. the power of altering its freight rates
whenever it should find it necessary to do so in
order to meet the competition of road trucks and
autobuses, or to change its freight rates at will, or to
regard its present rates as maximum rates, and to
fix lower rates whenever in the opinion of the
Philippine Railway Co. it would be to its advantage
to do so.
The mere recital of the language of the application
of the Philippine Railway Co. is enough to show that
it is untenable. The Legislature has delegated to the
Public Service Commission the power of fixing the
rates of public services, but it has not authorized the
Public Service Commission to delegate that power
 to a common carrier or other public service. The
rates of public services like the Philippine Railway
Co. have been approved or fixed by the Public
Service Commission, and any change in such rates
must be authorized or approved by the Public
Service Commission after they have been shown to
be just and reasonable. The public service may, of
course, propose new rates, as the Philippine
Railway Co. did in case No. 31827, but it cannot
lawfully make said new rates effective without the
approval of the Public Service Commission, and the
Public Service Commission itself cannot authorize a
public service to enforce new rates without the prior
approval of said rates by the commission. The
commission must approve new rates when they are
submitted to it, if the evidence shows them to be just
and reasonable, otherwise it must disapprove them.
Clearly, the commission cannot determine in
advance whether or not the new rates of the
Philippine Railway Co. will be just and reasonable,
because it does not know what those rates will be.
In the present case the Philippine Railway Co. in
effect asked for permission to change its freight
rates at will. It may change them every day or every
hour, whenever it deems it necessary to do so in
order to meet competition or whenever in its opinion
it would be to its advantage. Such a procedure
would create a most unsatisfactory state of affairs
and largely defeat the purposes of the public service
law.13 (Emphasis ours).
One veritable consequence of the deregulation of transport fares is a
compounded fare. If transport operators will be authorized to impose
and collect an additional amount equivalent to 20% over and above the
authorized fare over a period of time, this will unduly prejudice a
commuter who will be made to pay a fare that has been computed in a
manner similar to those of compounded bank interest rates.
Picture this situation. On December 14, 1990, the LTFRB authorized
provincial bus operators to collect a thirty-seven (P0.37) centavo per
kilometer fare for ordinary buses. At the same time, they were allowed
to impose and collect a fare range of plus or minus 15% over the
authorized rate. Thus P0.37 centavo per kilometer authorized fare plus
P0.05 centavos (which is 15% of P0.37 centavos) is equivalent to
P0.42 centavos, the allowed rate in 1990. Supposing the LTFRB grants
another five (P0.05) centavo increase per kilometer in 1994, then, the
base or reference for computation would have to be P0.47 centavos
(which is P0.42 + P0.05 centavos). If bus operators will exercise their
authority to impose an additional 20% over and above the authorized
fare, then the fare to be collected shall amount to P0.56 (that is, P0.47
authorized LTFRB rate plus 20% of P0.47 which is P0.29). In effect,
commuters will be continuously subjected, not only to a double fare
adjustment but to a compounding fare as well. On their part, transport
operators shall enjoy a bigger chunk of the pie. Aside from fare
increase applied for, they can still collect an additional amount by virtue
of the authorized fare range. Mathematically, the situation translates
into the following:
Year** LTFRB authorized Fare Range Fare to be
rate*** collected per
kilometer
1990 P0.37 15% (P0.05) P0.42
1994 P0.42 + 0.05 = 0.47 20% (P0.09) P0.56
1998 P0.56 + 0.05 = 0.61 20% (P0.12) P0.73
2002 P0.73 + 0.05 = 0.78 20% (P0.16) P0.94
Moreover, rate making or rate fixing is not an easy task. It is a delicate
and sensitive government function that requires dexterity of judgment
and sound discretion with the settled goal of arriving at a just and
reasonable rate acceptable to both the public utility and the public.
Several factors, in fact, have to be taken into consideration before a
balance could be achieved. A rate should not be confiscatory as would
place an operator in a situation where he will continue to operate at a
loss. Hence, the rate should enable public utilities to generate revenues
sufficient to cover operational costs and provide reasonable return on
the investments. On the other hand, a rate which is too high becomes
discriminatory. It is contrary to public interest. A rate, therefore, must be
reasonable and fair and must be affordable to the end user who will
utilize the services.
Given the complexity of the nature of the function of rate-fixing and its
far-reaching effects on millions of commuters, government must not
relinquish this important function in favor of those who would benefit
and profit from the industry. Neither should the requisite notice and
hearing be done away with. The people, represented by reputable
oppositors, deserve to be given full opportunity to be heard in their
opposition to any fare increase.
The present administrative procedure, 14 to our mind, already mirrors
an orderly and satisfactory arrangement for all parties involved. To do
away with such a procedure and allow just one party, an interested
party at that, to determine what the rate should be, will undermine the
right of the other parties to due process. The purpose of a hearing is
precisely to determine what a just and reasonable rate is.15 Discarding
such procedural and constitutional right is certainly inimical to our
fundamental law and to public interest.
On the presumption of public need.
A certificate of public convenience (CPC) is an authorization granted by
the LTFRB for the operation of land transportation services for public
use as required by law. Pursuant to Section 16(a) of the Public Service
Act, as amended, the following requirements must be met before a
CPC may be granted, to wit: (i) the applicant must be a citizen of the
Philippines, or a corporation or co-partnership, association or joint-stock
company constituted and organized under the laws of the Philippines,
at least 60 per centum of its stock or paid-up capital must belong
entirely to citizens of the Philippines; (ii) the applicant must be
financially capable of undertaking the proposed service and meeting
the responsibilities incident to its operation; and (iii) the applicant must
prove that the operation of the public service proposed and the
authorization to do business will promote the public interest in a proper
and suitable manner. It is understood that there must be proper notice
and hearing before the PSC can exercise its power to issue a CPC.
While adopting in toto the foregoing requisites for the issuance of a
CPC, LTFRB Memorandum Circular No. 92-009, Part IV, provides for
yet incongruous and contradictory policy guideline on the issuance of a
CPC. The guidelines states:
The issuance of a Certificate of Public Convenience
is determined by public need. The presumption of
public need for a service shall be deemed in favor of
the applicant, while the burden of proving that there
is no need for the proposed service shall be the
oppositor's. (Emphasis ours).
The above-quoted provision is entirely incompatible and inconsistent
with Section 16(c)(iii) of the Public Service Act which requires that
before a CPC will be issued, the applicant must prove by proper notice
and hearing that the operation of the public service proposed will
promote public interest in a proper and suitable manner. On the
contrary, the policy guideline states that the presumption of public need
for a public service shall be deemed in favor of the applicant. In case of
conflict between a statute and an administrative order, the former must
prevail.
By its terms, public convenience or necessity generally means
something fitting or suited to the public need.16 As one of the basic
requirements for the grant of a CPC, public convenience and necessity
exists when the proposed facility or service meets a reasonable want of
the public and supply a need which the existing facilities do not
adequately supply. The existence or
non-existence of public convenience and necessity is therefore a
question of fact that must be established by evidence, real and/or
testimonial; empirical data; statistics and such other means necessary,
in a public hearing conducted for that purpose. The object and purpose
of such procedure, among other things, is to look out for, and protect,
the interests of both the public and the existing transport operators.
Verily, the power of a regulatory body to issue a CPC is founded on the
condition that after full-dress hearing and investigation, it shall find, as a
fact, that the proposed operation is for the convenience of the public. 17
Basic convenience is the primary consideration for which a CPC is
issued, and that fact alone must be consistently borne in mind. Also,
existing operators in subject routes must be given an opportunity to
offer proof and oppose the application. Therefore, an applicant must, at
all times, be required to prove his capacity and capability to furnish the
service which he has undertaken to
render. 18 And all this will be possible only if a public hearing were
conducted for that purpose.
Otherwise stated, the establishment of public need in favor of an
applicant reverses well-settled and institutionalized judicial, quasi-
judicial and administrative procedures. It allows the party who initiates
the proceedings to prove, by mere application, his affirmative
allegations. Moreover, the offending provisions of the LTFRB
memorandum circular in question would in effect amend the Rules of
Court by adding another disputable presumption in the enumeration of
37 presumptions under Rule 131, Section 5 of the Rules of Court. Such
usurpation of this Court's authority cannot be countenanced as only this
Court is mandated by law to promulgate rules concerning pleading,
practice and procedure. 19
Deregulation, while it may be ideal in certain situations, may not be
ideal at all in our country given the present circumstances. Advocacy of
liberalized franchising and regulatory process is tantamount to an
abdication by the government of its inherent right to exercise police
power, that is, the right of government to regulate public utilities for
protection of the public and the utilities themselves.
While we recognize the authority of the DOTC and the LTFRB to issue
administrative orders to regulate the transport sector, we find that they
committed grave abuse of discretion in issuing DOTC Department
Order
No. 92-587 defining the policy framework on the regulation of transport
services and LTFRB Memorandum Circular No. 92-009 promulgating
the implementing guidelines on DOTC Department Order No. 92-587,
the said administrative issuances being amendatory and violative of the
Public Service Act and the Rules of Court. Consequently, we rule that
the twenty (20%) per centum fare increase imposed by respondent
PBOAP on March 16, 1994 without the benefit of a petition and a public
hearing is null and void and of no force and effect. No grave abuse of
discretion however was committed in the issuance of DOTC
Memorandum Order No. 90-395 and DOTC Memorandum dated
October 8, 1992, the same being merely internal communications
between administrative officers.
WHEREFORE, in view of the foregoing, the instant petition is hereby
GRANTED and the challenged administrative issuances and orders,
namely: DOTC Department Order No. 92-587, LTFRB Memorandum
Circular
No. 92-009, and the order dated March 24, 1994 issued by respondent
LTFRB are hereby DECLARED contrary to law and invalid insofar as
they affect provisions therein (a) delegating to provincial bus and
jeepney operators the authority to increase or decrease the duly
prescribed transportation fares; and (b) creating a presumption of public
need for a service in favor of the applicant for a certificate of public
convenience and placing the burden of proving that there is no need for
the proposed service to the oppositor.
The Temporary Restraining Order issued on June 20, 1994 is hereby
MADE PERMANENT insofar as it enjoined the bus fare rate increase
granted under the provisions of the aforementioned administrative
circulars, memoranda and/or orders declared invalid.
No pronouncement as to costs.
SO ORDERED.
G.R. No. 141284               August 15, 2000
INTEGRATED BAR OF THE PHILIPPINES, petitioner,
vs.
HON. RONALDO B. ZAMORA, GEN. PANFILO M. LACSON, GEN.
EDGAR B. AGLIPAY, and GEN. ANGELO REYES, respondents.
DECISION
KAPUNAN, J.:
At bar is a special civil action for certiorari and prohibition with prayer
for issuance of a temporary restraining order seeking to nullify on
constitutional grounds the order of President Joseph Ejercito Estrada
commanding the deployment of the Philippine Marines (the "Marines")
to join the Philippine National Police (the "PNP") in visibility patrols
around the metropolis.
In view of the alarming increase in violent crimes in Metro Manila, like
robberies, kidnappings and carnappings, the President, in a verbal
directive, ordered the PNP and the Marines to conduct joint visibility
patrols for the purpose of crime prevention and suppression. The
Secretary of National Defense, the Chief of Staff of the Armed Forces
of the Philippines (the "AFP"), the Chief of the PNP and the Secretary
of the Interior and Local Government were tasked to execute and
implement the said order. In compliance with the presidential mandate,
the PNP Chief, through Police Chief Superintendent Edgar B. Aglipay,
formulated Letter of Instruction 02/20001 (the "LOI") which detailed the
manner by which the joint visibility patrols, called Task Force Tulungan,
would be conducted.2 Task Force Tulungan was placed under the
leadership of the Police Chief of Metro Manila.
Subsequently, the President confirmed his previous directive on the
deployment of the Marines in a Memorandum, dated 24 January 2000,
addressed to the Chief of Staff of the AFP and the PNP Chief.3 In the
Memorandum, the President expressed his desire to improve the peace
and order situation in Metro Manila through a more effective crime
prevention program including increased police patrols.4 The President
further stated that to heighten police visibility in the metropolis,
augmentation from the AFP is necessary.5 Invoking his powers as
Commander-in-Chief under Section 18, Article VII of the Constitution,
the President directed the AFP Chief of Staff and PNP Chief to
coordinate with each other for the proper deployment and utilization of
the Marines to assist the PNP in preventing or suppressing criminal or
lawless violence.6 Finally, the President declared that the services of
the Marines in the anti-crime campaign are merely temporary in nature
and for a reasonable period only, until such time when the situation
shall have improved.7
The LOI explains the concept of the PNP-Philippine Marines joint
visibility patrols as follows:
xxx
2. PURPOSE:
The Joint Implementing Police Visibility Patrols between the PNP
NCRPO and the Philippine Marines partnership in the conduct of
visibility patrols in Metro Manila for the suppression of crime prevention
and other serious threats to national security.
3. SITUATION:
Criminal incidents in Metro Manila have been perpetrated not only by
ordinary criminals but also by organized syndicates whose members
include active and former police/military personnel whose training, skill,
discipline and firepower prove well-above the present capability of the
local police alone to handle. The deployment of a joint PNP NCRPO-
Philippine Marines in the conduct of police visibility patrol in urban
areas will reduce the incidence of crimes specially those perpetrated by
active or former police/military personnel.
4. MISSION:
The PNP NCRPO will organize a provisional Task Force to conduct
joint NCRPO-PM visibility patrols to keep Metro Manila streets crime-
free, through a sustained street patrolling to minimize or eradicate all
forms of high-profile crimes especially those perpetrated by organized
crime syndicates whose members include those that are well-trained,
disciplined and well-armed active or former PNP/Military personnel.
5. CONCEPT IN JOINT VISIBILITY PATROL OPERATIONS:
a. The visibility patrols shall be conducted jointly by
the NCRPO [National Capital Regional Police
Office] and the Philippine Marines to curb criminality
in Metro Manila and to preserve the internal security
of the state against insurgents and other serious
threat to national security, although the primary
responsibility over Internal Security Operations still
rests upon the AFP.
b. The principle of integration of efforts shall be
applied to eradicate all forms of high-profile crimes
perpetrated by organized crime syndicates
operating in Metro Manila. This concept requires the
military and police to work cohesively and unify
efforts to ensure a focused, effective and holistic
approach in addressing crime prevention. Along this
line, the role of the military and police aside from
neutralizing crime syndicates is to bring a
wholesome atmosphere wherein delivery of basic
services to the people and development is
achieved. Hand-in-hand with this joint NCRPO-
Philippine Marines visibility patrols, local Police
Units are responsible for the maintenance of peace
and order in their locality.
c. To ensure the effective implementation of this
project, a provisional Task Force "TULUNGAN"
shall be organized to provide the mechanism,
structure, and procedures for the integrated
planning, coordinating, monitoring and assessing
the security situation.
xxx.8
The selected areas of deployment under the LOI are: Monumento
Circle, North Edsa (SM City), Araneta Shopping Center, Greenhills, SM
Megamall, Makati Commercial Center, LRT/MRT Stations and the NAIA
and Domestic Airport.9
On 17 January 2000, the Integrated Bar of the Philippines (the "IBP")
filed the instant petition to annul LOI 02/2000 and to declare the
deployment of the Philippine Marines, null and void and
unconstitutional, arguing that:
I
THE DEPLOYMENT OF THE PHILIPPINE MARINES IN METRO
MANILA IS VIOLATIVE OF THE CONSTITUTION, IN THAT:
A) NO EMERGENCY SITUATION OBTAINS IN
METRO MANILA AS WOULD JUSTIFY, EVEN
ONLY REMOTELY, THE DEPLOYMENT OF
SOLDIERS FOR LAW ENFORCEMENT WORK;
HENCE, SAID DEPLOYMENT IS IN DEROGATION
OF ARTICLE II, SECTION 3 OF THE
CONSTITUTION;
B) SAID DEPLOYMENT CONSTITUTES AN
INSIDIOUS INCURSION BY THE MILITARY IN A
CIVILIAN FUNCTION OF GOVERNMENT (LAW
ENFORCEMENT) IN DEROGATION OF ARTICLE
XVI, SECTION 5 (4), OF THE CONSTITUTION;
C) SAID DEPLOYMENT CREATES A
DANGEROUS TENDENCY TO RELY ON THE
MILITARY TO PERFORM THE CIVILIAN
FUNCTIONS OF THE GOVERNMENT.
II
IN MILITARIZING LAW ENFORCEMENT IN METRO MANILA, THE
ADMINISTRATION IS UNWITTINGLY MAKING THE MILITARY MORE
POWERFUL THAN WHAT IT SHOULD REALLY BE UNDER THE
CONSTITUTION.10
Asserting itself as the official organization of Filipino lawyers tasked
with the bounden duty to uphold the rule of law and the Constitution,
the IBP questions the validity of the deployment and utilization of the
Marines to assist the PNP in law enforcement.
Without granting due course to the petition, the Court in a Resolution,11
dated 25 January 2000, required the Solicitor General to file his
Comment on the petition. On 8 February 2000, the Solicitor General
submitted his Comment.
The Solicitor General vigorously defends the constitutionality of the act
of the President in deploying the Marines, contending, among others,
that petitioner has no legal standing; that the question of deployment of
the Marines is not proper for judicial scrutiny since the same involves a
political question; that the organization and conduct of police visibility
patrols, which feature the team-up of one police officer and one
Philippine Marine soldier, does not violate the civilian supremacy clause
in the Constitution.
The issues raised in the present petition are: (1) Whether or not
petitioner has legal standing; (2) Whether or not the President’s factual
determination of the necessity of calling the armed forces is subject to
judicial review; and, (3) Whether or not the calling of the armed forces
to assist the PNP in joint visibility patrols violates the constitutional
provisions on civilian supremacy over the military and the civilian
character of the PNP.
The petition has no merit.
First, petitioner failed to sufficiently show that it is in possession of the
requisites of standing to raise the issues in the petition. Second, the
President did not commit grave abuse of discretion amounting to lack or
excess of jurisdiction nor did he commit a violation of the civilian
supremacy clause of the Constitution.
The power of judicial review is set forth in Section 1, Article VIII of the
Constitution, to wit:
Section 1. The judicial power shall be vested in one Supreme Court and
in such lower courts as may be established by law.
Judicial power includes the duty of the courts of justice to settle actual
controversies involving rights which are legally demandable and
enforceable, and to determine whether or not there has been grave
abuse of discretion amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the Government.
When questions of constitutional significance are raised, the Court can
exercise its power of judicial review only if the following requisites are
complied with, namely: (1) the existence of an actual and appropriate
case; (2) a personal and substantial interest of the party raising the
constitutional question; (3) the exercise of judicial review is pleaded at
the earliest opportunity; and (4) the constitutional question is the lis
mota of the case.12
The IBP has not sufficiently complied with the requisites of standing in
this case.
"Legal standing" or locus standi has been defined as a personal and
substantial interest in the case such that the party has sustained or will
sustain direct injury as a result of the governmental act that is being
challenged.13 The term "interest" means a material interest, an interest
in issue affected by the decree, as distinguished from mere interest in
the question involved, or a mere incidental interest.14 The gist of the
question of standing is whether a party alleges "such personal stake in
the outcome of the controversy as to assure that concrete adverseness
which sharpens the presentation of issues upon which the court
depends for illumination of difficult constitutional questions."15
In the case at bar, the IBP primarily anchors its standing on its alleged
responsibility to uphold the rule of law and the Constitution. Apart from
this declaration, however, the IBP asserts no other basis in support of
its locus standi. The mere invocation by the IBP of its duty to preserve
the rule of law and nothing more, while undoubtedly true, is not
sufficient to clothe it with standing in this case. This is too general an
interest which is shared by other groups and the whole citizenry. Based
on the standards above-stated, the IBP has failed to present a specific
and substantial interest in the resolution of the case. Its fundamental
purpose which, under Section 2, Rule 139-A of the Rules of Court, is to
elevate the standards of the law profession and to improve the
administration of justice is alien to, and cannot be affected by the
deployment of the Marines. It should also be noted that the interest of
the National President of the IBP who signed the petition, is his alone,
absent a formal board resolution authorizing him to file the present
action. To be sure, members of the BAR, those in the judiciary
included, have varying opinions on the issue. Moreover, the IBP,
assuming that it has duly authorized the National President to file the
petition, has not shown any specific injury which it has suffered or may
suffer by virtue of the questioned governmental act. Indeed, none of its
members, whom the IBP purportedly represents, has sustained any
form of injury as a result of the operation of the joint visibility patrols.
Neither is it alleged that any of its members has been arrested or that
their civil liberties have been violated by the deployment of the Marines.
What the IBP projects as injurious is the supposed "militarization" of law
enforcement which might threaten Philippine democratic institutions
and may cause more harm than good in the long run. Not only is the
presumed "injury" not personal in character, it is likewise too vague,
highly speculative and uncertain to satisfy the requirement of standing.
Since petitioner has not successfully established a direct and personal
injury as a consequence of the questioned act, it does not possess the
personality to assail the validity of the deployment of the Marines. This
Court, however, does not categorically rule that the IBP has absolutely
no standing to raise constitutional issues now or in the future. The IBP
must, by way of allegations and proof, satisfy this Court that it has
sufficient stake to obtain judicial resolution of the controversy.
Having stated the foregoing, it must be emphasized that this Court has
the discretion to take cognizance of a suit which does not satisfy the
requirement of legal standing when paramount interest is involved.16 In
not a few cases, the Court has adopted a liberal attitude on the locus
standi of a petitioner where the petitioner is able to craft an issue of
transcendental significance to the people.17 Thus, when the issues
raised are of paramount importance to the public, the Court may brush
aside technicalities of procedure.18 In this case, a reading of the
petition shows that the IBP has advanced constitutional issues which
deserve the attention of this Court in view of their seriousness, novelty
and weight as precedents. Moreover, because peace and order are
under constant threat and lawless violence occurs in increasing tempo,
undoubtedly aggravated by the Mindanao insurgency problem, the legal
controversy raised in the petition almost certainly will not go away. It will
stare us in the face again. It, therefore, behooves the Court to relax the
rules on standing and to resolve the issue now, rather than later.
The President did not commit grave abuse of discretion in calling out
the Marines.
In the case at bar, the bone of contention concerns the factual
determination of the President of the necessity of calling the armed
forces, particularly the Marines, to aid the PNP in visibility patrols. In
this regard, the IBP admits that the deployment of the military personnel
falls under the Commander-in-Chief powers of the President as stated
in Section 18, Article VII of the Constitution, specifically, the power to
call out the armed forces to prevent or suppress lawless violence,
invasion or rebellion. What the IBP questions, however, is the basis for
the calling of the Marines under the aforestated provision. According to
the IBP, no emergency exists that would justify the need for the calling
of the military to assist the police force. It contends that no lawless
violence, invasion or rebellion exist to warrant the calling of the
Marines. Thus, the IBP prays that this Court "review the sufficiency of
the factual basis for said troop [Marine] deployment."19
The Solicitor General, on the other hand, contends that the issue
pertaining to the necessity of calling the armed forces is not proper for
judicial scrutiny since it involves a political question and the resolution
of factual issues which are beyond the review powers of this Court.
As framed by the parties, the underlying issues are the scope of
presidential powers and limits, and the extent of judicial review. But,
while this Court gives considerable weight to the parties’ formulation of
the issues, the resolution of the controversy may warrant a creative
approach that goes beyond the narrow confines of the issues raised.
Thus, while the parties are in agreement that the power exercised by
the President is the power to call out the armed forces, the Court is of
the view that the power involved may be no more than the maintenance
of peace and order and promotion of the general welfare.20 For one,
the realities on the ground do not show that there exist a state of
warfare, widespread civil unrest or anarchy. Secondly, the full brunt of
the military is not brought upon the citizenry, a point discussed in the
latter part of this decision. In the words of the late Justice Irene Cortes
in Marcos v. Manglapus:
More particularly, this case calls for the exercise of the President’s
powers as protector of the peace. [Rossiter, The American Presidency].
The power of the President to keep the peace is not limited merely to
exercising the commander-in-chief powers in times of emergency or to
leading the State against external and internal threats to its existence.
The President is not only clothed with extraordinary powers in times of
emergency, but is also tasked with attending to the day-to-day
problems of maintaining peace and order and ensuring domestic
tranquility in times when no foreign foe appears on the horizon. Wide
discretion, within the bounds of law, in fulfilling presidential duties in
times of peace is not in any way diminished by the relative want of an
emergency specified in the commander-in-chief provision. For in
making the President commander-in-chief the enumeration of powers
that follow cannot be said to exclude the President’s exercising as
Commander-in-Chief powers short of the calling of the armed forces, or
suspending the privilege of the writ of habeas corpus or declaring
martial law, in order to keep the peace, and maintain public order and
security.
xxx21
Nonetheless, even if it is conceded that the power involved is the
President’s power to call out the armed forces to prevent or suppress
lawless violence, invasion or rebellion, the resolution of the controversy
will reach a similar result.
We now address the Solicitor General’s argument that the issue
involved is not susceptible to review by the judiciary because it involves
a political question, and thus, not justiciable.
As a general proposition, a controversy is justiciable if it refers to a
matter which is appropriate for court review.22 It pertains to issues
which are inherently susceptible of being decided on grounds
recognized by law. Nevertheless, the Court does not automatically
assume jurisdiction over actual constitutional cases brought before it
even in instances that are ripe for resolution. One class of cases
wherein the Court hesitates to rule on are "political questions." The
reason is that political questions are concerned with issues dependent
upon the wisdom, not the legality, of a particular act or measure being
assailed. Moreover, the political question being a function of the
separation of powers, the courts will not normally interfere with the
workings of another co-equal branch unless the case shows a clear
need for the courts to step in to uphold the law and the Constitution.
As Tañada v. Cuenco23 puts it, political questions refer "to those
questions which, under the Constitution, are to be decided by the
people in their sovereign capacity, or in regard to which full
discretionary authority has been delegated to the legislative or
executive branch of government." Thus, if an issue is clearly identified
by the text of the Constitution as matters for discretionary action by a
particular branch of government or to the people themselves then it is
held to be a political question. In the classic formulation of Justice
Brennan in Baker v. Carr,24 "[p]rominent on the surface of any case
held to involve a political question is found a textually demonstrable
constitutional commitment of the issue to a coordinate political
department; or a lack of judicially discoverable and manageable
standards for resolving it; or the impossibility of deciding without an
initial policy determination of a kind clearly for nonjudicial discretion; or
the impossibility of a court’s undertaking independent resolution without
expressing lack of the respect due coordinate branches of government;
or an unusual need for unquestioning adherence to a political decision
already made; or the potentiality of embarassment from multifarious
pronouncements by various departments on the one question."
The 1987 Constitution expands the concept of judicial review by
providing that "(T)he Judicial power shall be vested in one Supreme
Court and in such lower courts as may be established by law. Judicial
power includes the duty of the courts of justice to settle actual
controversies involving rights which are legally demandable and
enforceable, and to determine whether or not there has been a grave
abuse of discretion amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the Government."25 Under this
definition, the Court cannot agree with the Solicitor General that the
issue involved is a political question beyond the jurisdiction of this Court
to review. When the grant of power is qualified, conditional or subject to
limitations, the issue of whether the prescribed qualifications or
conditions have been met or the limitations respected, is justiciable -
the problem being one of legality or validity, not its wisdom.26
Moreover, the jurisdiction to delimit constitutional boundaries has been
given to this Court.27 When political questions are involved, the
Constitution limits the determination as to whether or not there has
been a grave abuse of discretion amounting to lack or excess of
jurisdiction on the part of the official whose action is being
questioned.28
By grave abuse of discretion is meant simply capricious or whimsical
exercise of judgment that is patent and gross as to amount to an
evasion of positive duty or a virtual refusal to perform a duty enjoined
by law, or to act at all in contemplation of law, as where the power is
exercised in an arbitrary and despotic manner by reason of passion or
hostility.29 Under this definition, a court is without power to directly
decide matters over which full discretionary authority has been
delegated. But while this Court has no power to substitute its judgment
for that of Congress or of the President, it may look into the question of
whether such exercise has been made in grave abuse of discretion.30
A showing that plenary power is granted either department of
government, may not be an obstacle to judicial inquiry, for the
improvident exercise or abuse thereof may give rise to justiciable
controversy.31
When the President calls the armed forces to prevent or suppress
lawless violence, invasion or rebellion, he necessarily exercises a
discretionary power solely vested in his wisdom. This is clear from the
intent of the framers and from the text of the Constitution itself. The
Court, thus, cannot be called upon to overrule the President’s wisdom
or substitute its own. However, this does not prevent an examination of
whether such power was exercised within permissible constitutional
limits or whether it was exercised in a manner constituting grave abuse
of discretion. In view of the constitutional intent to give the President full
discretionary power to determine the necessity of calling out the armed
forces, it is incumbent upon the petitioner to show that the President’s
decision is totally bereft of factual basis. The present petition fails to
discharge such heavy burden as there is no evidence to support the
assertion that there exist no justification for calling out the armed
forces. There is, likewise, no evidence to support the proposition that
grave abuse was committed because the power to call was exercised in
such a manner as to violate the constitutional provision on civilian
supremacy over the military. In the performance of this Court’s duty of
"purposeful hesitation"32 before declaring an act of another branch as
unconstitutional, only where such grave abuse of discretion is clearly
shown shall the Court interfere with the President’s judgment. To doubt
is to sustain.
There is a clear textual commitment under the Constitution to bestow
on the President full discretionary power to call out the armed forces
and to determine the necessity for the exercise of such power. Section
18, Article VII of the Constitution, which embodies the powers of the
President as Commander-in-Chief, provides in part:
The President shall be the Commander-in-Chief of all armed forces of
the Philippines and whenever it becomes necessary, he may call out
such armed forces to prevent or suppress lawless violence, invasion or
rebellion. In case of invasion or rebellion, when the public safety
requires it, he may, for a period not exceeding sixty days, suspend the
privilege of the writ of habeas corpus, or place the Philippines or any
part thereof under martial law.
xxx
The full discretionary power of the President to determine the factual
basis for the exercise of the calling out power is also implied and further
reinforced in the rest of Section 18, Article VII which reads, thus:
xxx
Within forty-eight hours from the proclamation of martial law or the
suspension of the privilege of the writ of habeas corpus, the President
shall submit a report in person or in writing to the Congress. The
Congress, voting jointly, by a vote of at least a majority of all its
Members in regular or special session, may revoke such proclamation
or suspension, which revocation shall not be set aside by the President.
Upon the initiative of the President, the Congress may, in the same
manner, extend such proclamation or suspension for a period to be
determined by the Congress, if the invasion or rebellion shall persist
and public safety requires it.
The Congress, if not in session, shall within twenty-four hours following
such proclamation or suspension, convene in accordance with its rules
without need of a call.
The Supreme Court may review, in an appropriate proceeding filed by
any citizen, the sufficiency of the factual basis of the proclamation of
martial law or the suspension of the privilege of the writ or the extension
thereof, and must promulgate its decision thereon within thirty days
from its filing.
A state of martial law does not suspend the operation of the
Constitution, nor supplant the functioning of the civil courts or legislative
assemblies, nor authorize the conferment of jurisdiction on military
courts and agencies over civilians where civil courts are able to
function, nor automatically suspend the privilege of the writ.
The suspension of the privilege of the writ shall apply only to persons
judicially charged for rebellion or offenses inherent in or directly
connected with invasion.
During the suspension of the privilege of the writ, any person thus
arrested or detained shall be judicially charged within three days,
otherwise he shall be released.
Under the foregoing provisions, Congress may revoke such
proclamation or suspension and the Court may review the sufficiency of
the factual basis thereof. However, there is no such equivalent
provision dealing with the revocation or review of the President’s action
to call out the armed forces. The distinction places the calling out power
in a different category from the power to declare martial law and the
power to suspend the privilege of the writ of habeas corpus, otherwise,
the framers of the Constitution would have simply lumped together the
three powers and provided for their revocation and review without any
qualification. Expressio unius est exclusio alterius. Where the terms are
expressly limited to certain matters, it may not, by interpretation or
construction, be extended to other matters.33 That the intent of the
Constitution is exactly what its letter says, i.e., that the power to call is
fully discretionary to the President, is extant in the deliberation of the
Constitutional Commission, to wit:
FR. BERNAS. It will not make any difference. I may add that there is a
graduated power of the President as Commander-in-Chief. First, he can
call out such Armed Forces as may be necessary to suppress lawless
violence; then he can suspend the privilege of the writ of habeas
corpus, then he can impose martial law. This is a graduated sequence.
When he judges that it is necessary to impose martial law or suspend
the privilege of the writ of habeas corpus, his judgment is subject to
review. We are making it subject to review by the Supreme Court and
subject to concurrence by the National Assembly. But when he
exercises this lesser power of calling on the Armed Forces, when he
says it is necessary, it is my opinion that his judgment cannot be
reviewed by anybody.
xxx
FR. BERNAS. Let me just add that when we only have imminent
danger, the matter can be handled by the first sentence: "The President
may call out such armed forces to prevent or suppress lawless
violence, invasion or rebellion." So we feel that that is sufficient for
handling imminent danger.
MR. DE LOS REYES. So actually, if a President feels that there is
imminent danger, the matter can be handled by the First Sentence:
"The President....may call out such Armed Forces to prevent or
suppress lawless violence, invasion or rebellion." So we feel that that is
sufficient for handling imminent danger, of invasion or rebellion, instead
of imposing martial law or suspending the writ of habeas corpus, he
must necessarily have to call the Armed Forces of the Philippines as
their Commander-in-Chief. Is that the idea?
MR. REGALADO. That does not require any concurrence by the
legislature nor is it subject to judicial review.34
The reason for the difference in the treatment of the aforementioned
powers highlights the intent to grant the President the widest leeway
and broadest discretion in using the power to call out because it is
considered as the lesser and more benign power compared to the
power to suspend the privilege of the writ of habeas corpus and the
power to impose martial law, both of which involve the curtailment and
suppression of certain basic civil rights and individual freedoms, and
thus necessitating safeguards by Congress and review by this Court.
Moreover, under Section 18, Article VII of the Constitution, in the
exercise of the power to suspend the privilege of the writ of habeas
corpus or to impose martial law, two conditions must concur: (1) there
must be an actual invasion or rebellion and, (2) public safety must
require it. These conditions are not required in the case of the power to
call out the armed forces. The only criterion is that "whenever it
becomes necessary," the President may call the armed forces "to
prevent or suppress lawless violence, invasion or rebellion." The
implication is that the President is given full discretion and wide latitude
in the exercise of the power to call as compared to the two other
powers.
If the petitioner fails, by way of proof, to support the assertion that the
President acted without factual basis, then this Court cannot undertake
an independent investigation beyond the pleadings. The factual
necessity of calling out the armed forces is not easily quantifiable and
cannot be objectively established since matters considered for
satisfying the same is a combination of several factors which are not
always accessible to the courts. Besides the absence of textual
standards that the court may use to judge necessity, information
necessary to arrive at such judgment might also prove unmanageable
for the courts. Certain pertinent information might be difficult to verify, or
wholly unavailable to the courts. In many instances, the evidence upon
which the President might decide that there is a need to call out the
armed forces may be of a nature not constituting technical proof.
On the other hand, the President as Commander-in-Chief has a vast
intelligence network to gather information, some of which may be
classified as highly confidential or affecting the security of the state. In
the exercise of the power to call, on-the-spot decisions may be
imperatively necessary in emergency situations to avert great loss of
human lives and mass destruction of property. Indeed, the decision to
call out the military to prevent or suppress lawless violence must be
done swiftly and decisively if it were to have any effect at all. Such a
scenario is not farfetched when we consider the present situation in
Mindanao, where the insurgency problem could spill over the other
parts of the country. The determination of the necessity for the calling
out power if subjected to unfettered judicial scrutiny could be a veritable
prescription for disaster, as such power may be unduly straitjacketed by
an injunction or a temporary restraining order every time it is exercised.
Thus, it is the unclouded intent of the Constitution to vest upon the
President, as Commander-in-Chief of the Armed Forces, full discretion
to call forth the military when in his judgment it is necessary to do so in
order to prevent or suppress lawless violence, invasion or rebellion.
Unless the petitioner can show that the exercise of such discretion was
gravely abused, the President’s exercise of judgment deserves to be
accorded respect from this Court.
The President has already determined the necessity and factual basis
for calling the armed forces. In his Memorandum, he categorically
asserted that, "[V]iolent crimes like bank/store robberies, holdups,
kidnappings and carnappings continue to occur in Metro Manila..."35
We do not doubt the veracity of the President’s assessment of the
situation, especially in the light of present developments. The Court
takes judicial notice of the recent bombings perpetrated by lawless
elements in the shopping malls, public utilities, and other public places.
These are among the areas of deployment described in the LOI 2000.
Considering all these facts, we hold that the President has sufficient
factual basis to call for military aid in law enforcement and in the
exercise of this constitutional power.
The deployment of the Marines does not violate the civilian supremacy
clause nor does it infringe the civilian character of the police force.
Prescinding from its argument that no emergency situation exists to
justify the calling of the Marines, the IBP asserts that by the deployment
of the Marines, the civilian task of law enforcement is "militarized" in
violation of Section 3, Article II36 of the Constitution.
We disagree. The deployment of the Marines does not constitute a
breach of the civilian supremacy clause. The calling of the Marines in
this case constitutes permissible use of military assets for civilian law
enforcement. The participation of the Marines in the conduct of joint
visibility patrols is appropriately circumscribed. The limited participation
of the Marines is evident in the provisions of the LOI itself, which
sufficiently provides the metes and bounds of the Marines’ authority. It
is noteworthy that the local police forces are the ones in charge of the
visibility patrols at all times, the real authority belonging to the PNP. In
fact, the Metro Manila Police Chief is the overall leader of the PNP-
Philippine Marines joint visibility patrols.37 Under the LOI, the police
forces are tasked to brief or orient the soldiers on police patrol
procedures.38 It is their responsibility to direct and manage the
deployment of the Marines.39 It is, likewise, their duty to provide the
necessary equipment to the Marines and render logistical support to
these soldiers.40 In view of the foregoing, it cannot be properly argued
that military authority is supreme over civilian authority. Moreover, the
deployment of the Marines to assist the PNP does not unmake the
civilian character of the police force. Neither does it amount to an
"insidious incursion" of the military in the task of law enforcement in
violation of Section 5(4), Article XVI of the Constitution.41
In this regard, it is not correct to say that General Angelo Reyes, Chief
of Staff of the AFP, by his alleged involvement in civilian law
enforcement, has been virtually appointed to a civilian post in
derogation of the aforecited provision. The real authority in these
operations, as stated in the LOI, is lodged with the head of a civilian
institution, the PNP, and not with the military. Such being the case, it
does not matter whether the AFP Chief actually participates in the Task
Force Tulungan since he does not exercise any authority or control
over the same. Since none of the Marines was incorporated or enlisted
as members of the PNP, there can be no appointment to civilian
position to speak of. Hence, the deployment of the Marines in the joint
visibility patrols does not destroy the civilian character of the PNP.
Considering the above circumstances, the Marines render nothing more
than assistance required in conducting the patrols. As such, there can
be no "insidious incursion" of the military in civilian affairs nor can there
be a violation of the civilian supremacy clause in the Constitution.
It is worth mentioning that military assistance to civilian authorities in
various forms persists in Philippine jurisdiction. The Philippine
experience reveals that it is not averse to requesting the assistance of
the military in the implementation and execution of certain traditionally
"civil" functions. As correctly pointed out by the Solicitor General, some
of the multifarious activities wherein military aid has been rendered,
exemplifying the activities that bring both the civilian and the military
together in a relationship of cooperation, are:
1. Elections;42
2. Administration of the Philippine National Red Cross;43
3. Relief and rescue operations during calamities and
disasters;44
4. Amateur sports promotion and development;45
5. Development of the culture and the arts;46
6. Conservation of natural resources;47
7. Implementation of the agrarian reform program;48
8. Enforcement of customs laws;49
9. Composite civilian-military law enforcement activities;50
10. Conduct of licensure examinations;51
11. Conduct of nationwide tests for elementary and high
school students;52
12. Anti-drug enforcement activities;53
13. Sanitary inspections;54
14. Conduct of census work;55
15. Administration of the Civil Aeronautics Board;56
16. Assistance in installation of weather forecasting
devices;57
17. Peace and order policy formulation in local government
units.58
This unquestionably constitutes a gloss on executive power resulting
from a systematic, unbroken, executive practice, long pursued to the
knowledge of Congress and, yet, never before questioned.59 What we
have here is mutual support and cooperation between the military and
civilian authorities, not derogation of civilian supremacy.
In the United States, where a long tradition of suspicion and hostility
towards the use of military force for domestic purposes has
persisted,60 and whose Constitution, unlike ours, does not expressly
provide for the power to call, the use of military personnel by civilian law
enforcement officers is allowed under circumstances similar to those
surrounding the present deployment of the Philippine Marines. Under
the Posse Comitatus Act61 of the US, the use of the military in civilian
law enforcement is generally prohibited, except in certain allowable
circumstances. A provision of the Act states:
§ 1385. Use of Army and Air Force as posse comitatus
Whoever, except in cases and under circumstances expressly
authorized by the Constitution or Act of Congress, willfully uses any
part of the Army or the Air Force as posse comitatus or otherwise to
execute the laws shall be fined not more than $10,000 or imprisoned
not more than two years, or both.62
To determine whether there is a violation of the Posse Comitatus Act in
the use of military personnel, the US courts63 apply the following
standards, to wit:
Were Army or Air Force personnel used by the civilian law enforcement
officers at Wounded Knee in such a manner that the military personnel
subjected the citizens to the exercise of military power which was
regulatory, proscriptive, or compulsory 64 George Washington Law
Review, pp. 404-433 (1986), which discusses the four divergent
standards for assessing acceptable involvement of military personnel in
civil law enforcement. See likewise HONORED IN THE BREECH:
PRESIDENTIAL AUTHORITY TO EXECUTE THE LAWS WITH
MILITARY FORCE, 83 Yale Law Journal, pp. 130-152, 1973. 64 in
nature, either presently or prospectively?
xxx
When this concept is transplanted into the present legal context, we
take it to mean that military involvement, even when not expressly
authorized by the Constitution or a statute, does not violate the Posse
Comitatus Act unless it actually regulates, forbids or compels some
conduct on the part of those claiming relief. 1âwphi1 A mere threat of
some future injury would be insufficient. (emphasis supplied)
Even if the Court were to apply the above rigid standards to the present
case to determine whether there is permissible use of the military in
civilian law enforcement, the conclusion is inevitable that no violation of
the civilian supremacy clause in the Constitution is committed. On this
point, the Court agrees with the observation of the Solicitor General:
3. The designation of tasks in Annex A65 does not constitute the
exercise of regulatory, proscriptive, or compulsory military power. First,
the soldiers do not control or direct the operation. This is evident from
Nos. 6,66 8(k)67 and 9(a)68 of Annex A. These soldiers, second, also
have no power to prohibit or condemn. In No. 9(d)69 of Annex A, all
arrested persons are brought to the nearest police stations for proper
disposition. And last, these soldiers apply no coercive force. The
materials or equipment issued to them, as shown in No. 8(c)70 of
Annex A, are all low impact and defensive in character. The conclusion
is that there being no exercise of regulatory, proscriptive or compulsory
military power, the deployment of a handful of Philippine Marines
constitutes no impermissible use of military power for civilian law
enforcement.71
It appears that the present petition is anchored on fear that once the
armed forces are deployed, the military will gain ascendancy, and thus
place in peril our cherished liberties. Such apprehensions, however, are
unfounded. The power to call the armed forces is just that - calling out
the armed forces. Unless, petitioner IBP can show, which it has not,
that in the deployment of the Marines, the President has violated the
fundamental law, exceeded his authority or jeopardized the civil
liberties of the people, this Court is not inclined to overrule the
President’s determination of the factual basis for the calling of the
Marines to prevent or suppress lawless violence.
One last point. Since the institution of the joint visibility patrol in
January, 2000, not a single citizen has complained that his political or
civil rights have been violated as a result of the deployment of the
Marines. It was precisely to safeguard peace, tranquility and the civil
liberties of the people that the joint visibility patrol was conceived.
Freedom and democracy will be in full bloom only when people feel
secure in their homes and in the streets, not when the shadows of
violence and anarchy constantly lurk in their midst.
WHEREFORE, premises considered, the petition is hereby
DISMISSED.
SO ORDERED.
SEPARATE OPINION
PUNO, J.:
If the case at bar is significant, it is because of the government attempt
to foist the political question doctrine to shield an executive act done
in the exercise of the commander-in-chief powers from judicial scrutiny.
If the attempt succeeded, it would have diminished the power of
judicial review and weakened the checking authority of this Court
over the Chief Executive when he exercises his commander-in-
chief powers. The attempt should remind us of the tragedy that
befell the country when this Court sought refuge in the political
question doctrine and forfeited its most important role as
protector of the civil and political rights of our people. The
ongoing conflict in Mindanao may worsen and can force the Chief
Executive to resort to the use of his greater commander-in-chief
powers, hence, this Court should be extra cautious in assaying
similar attempts. A laid back posture may not sit well with our
people considering that the 1987 Constitution strengthened the
checking powers of this Court and expanded its jurisdiction
precisely to stop any act constituting "xxx grave abuse of
jurisdiction xxx on the part of any branch or instrumentality of the
Government."1
The importance of the issue at bar includes this humble separate
opinion. We can best perceive the different intersecting dimensions of
the political question doctrine by viewing them from the broader
canvass of history. Political questions are defined as "those questions
which under the Constitution, are to be decided by the people in their
sovereign capacity, or in regard to which full discretionary authority has
been delegated to the legislative or executive branch of government." 2
They have two aspects: (1) those matters that are to be exercised by
the people in their primary political capacity and (2) matters which have
been specifically delegated to some other department or particular
office of the government, with discretionary power to act. 3 The exercise
of the discretionary power of the legislative or executive branch of
government was often the area where the Court had to wrestle with the
political question doctrine.4
A brief review of some of our case law will thus give us a sharper
perspective of the political question doctrine. This question confronted
the Court as early as 1905 in the case of Barcelon v. Baker.5 The
Governor-General of the Philippine Islands, pursuant to a resolution of
the Philippine Commission, suspended the privilege of the writ of
habeas corpus in Cavite and Batangas based on a finding of open
insurrection in said provinces. Felix Barcelon, who was detained by
constabulary officers in Batangas, filed a petition for the issuance of a
writ of habeas corpus alleging that there was no open insurrection in
Batangas. The issue to resolve was whether or not the judicial
department may investigate the facts upon which the legislative (the
Philippine Commission) and executive (the Governor-General)
branches of government acted in suspending the privilege of the writ.
The Court ruled that under our form of government, one department
has no authority to inquire into the acts of another, which acts are
performed within the discretion of the other department. 6 Surveying
American law and jurisprudence, it held that whenever a statute gives
discretionary power to any person, to be exercised by him upon his own
opinion of certain facts, the statute constitutes him the sole judge of
the existence of those facts.7 Since the Philippine Bill of 1902
empowered the Philippine Commission and the Governor-General to
suspend the privilege of the writ of habeas corpus, this power is
exclusively within the discretion of the legislative and executive
branches of government. The exercise of this discretion is
conclusive upon the courts.8
The Court further held that once a determination is made by the
executive and legislative departments that the conditions justifying the
assailed acts exists, it will presume that the conditions continue until the
same authority decide that they no longer exist. 9 It adopted the
rationale that the executive branch, thru its civil and military branches,
are better situated to obtain information about peace and order from
every corner of the nation, in contrast with the judicial department, with
its very limited machinery.10 The seed of the political question
doctrine was thus planted in Philippine soil.
The doctrine barring judicial review because of the political
question doctrine was next applied to the internal affairs of the
legislature. The Court refused to interfere in the legislative exercise of
disciplinary power over its own members. In the 1924 case of
Alejandrino v. Quezon,11 Alejandrino, who was appointed Senator by
the Governor-General, was declared by Senate Resolution as guilty of
disorderly conduct for assaulting another Senator in the course of a
debate, and was suspended from office for one year. Senator
Alejandrino filed a petition for mandamus and injunction to compel the
Senate to reinstate him. The Court held that under the Jones Law, the
power of the Senate to punish its members for disorderly behavior does
not authorize it to suspend an appointive member from the exercise of
his office. While the Court found that the suspension was illegal, it
refused to issue the writ of mandamus on the ground that "the Supreme
Court does not possess the power of coercion to make the Philippine
Senate take any particular action. [T]he Philippine Legislature or any
branch thereof cannot be directly controlled in the exercise of their
legislative powers by any judicial process."12
The issue revisited the Court twenty-two (22) years later. In 1946, in
Vera v. Avelino,13 three senators-elect who had been prevented from
taking their oaths of office by a Senate resolution repaired to this Court
to compel their colleagues to allow them to occupy their seats
contending that only the Electoral Tribunal had jurisdiction over
contests relating to their election, returns and qualifications. Again, the
Court refused to intervene citing Alejandrino and affirmed the inherent
right of the legislature to determine who shall be admitted to its
membership.
In the 1947 case of Mabanag v. Lopez-Vito,14 three Senators and eight
representatives who were proclaimed elected by Comelec were not
allowed by Congress to take part in the voting for the passage of the
Parity amendment to the Constitution. If their votes had been counted,
the affirmative votes in favor of the proposed amendment would have
been short of the necessary three-fourths vote in either House of
Congress to pass the amendment. The amendment was eventually
submitted to the people for ratification. The Court declined to intervene
and held that a proposal to amend the Constitution is a highly political
function performed by Congress in its sovereign legislative capacity. 15
In the 1955 case of Arnault v. Balagtas,16 petitioner, a private citizen,
assailed the legality of his detention ordered by the Senate for his
refusal to answer questions put to him by members of one of its
investigating committees. This Court refused to order his release
holding that the process by which a contumacious witness is dealt with
by the legislature is a necessary concomitant of the legislative process
and the legislature's exercise of its discretionary authority is not subject
to judicial interference.
In the 1960 case of Osmena v. Pendatun,17 the Court followed the
traditional line. Congressman Sergio Osmena, Jr. was suspended by
the House of Representatives for serious disorderly behavior for
making a privilege speech imputing "malicious charges" against the
President of the Philippines. Osmena, Jr. invoked the power of review
of this Court but the Court once more did not interfere with Congress'
power to discipline its members.
The contours of the political question doctrine have always been tricky.
To be sure, the Court did not always stay its hand whenever the
doctrine is invoked. In the 1949 case of Avelino v. Cuenco,18 Senate
President Jose Avelino, who was deposed and replaced, questioned
his successor's title claiming that the latter had been elected without a
quorum. The petition was initially dismissed on the ground that the
selection of Senate President was an internal matter and not subject to
judicial review.19 On reconsideration, however, the Court ruled that it
could assume jurisdiction over the controversy in light of subsequent
events justifying intervention among which was the existence of a
quorum.20 Though the petition was ultimately dismissed, the Court
declared respondent Cuenco as the legally elected Senate President.
In the 1957 case of Tanada v. Cuenco,21 the Court assumed
jurisdiction over a dispute involving the formation and composition of
the Senate Electoral Tribunal. It rejected the Solicitor General's claim
that the dispute involved a political question. Instead, it declared that
the Senate is not clothed with "full discretionary authority" in the choice
of members of the Senate Electoral Tribunal and the exercise of its
power thereon is subject to constitutional limitations which are
mandatory in nature.22 It held that under the Constitution, the
membership of the Senate Electoral Tribunal was designed to insure
the exercise of judicial impartiality in the disposition of election contests
affecting members of the lawmaking body.23 The Court then nullified the
election to the Senate Electoral Tribunal made by Senators belonging
to the party having the largest number of votes of two of their party
members but purporting to act on behalf of the party having the second
highest number of votes.
In the 1962 case of Cunanan v. Tan, Jr.,24 the Court passed judgment
on whether Congress had formed the Commission on Appointments in
accordance with the Constitution and found that it did not. It declared
that the Commission on Appointments is a creature of the Constitution
and its power does not come from Congress but from the Constitution.
The 1967 case of Gonzales v. Comelec25 and the 1971 case of
Tolentino v. Comelec26 abandoned Mabanag v. Lopez-Vito. The
question of whether or not Congress, acting as a constituent assembly
in proposing amendments to the Constitution violates the Constitution
was held to be a justiciable and not a political issue. In Gonzales, the
Court ruled:
"It is true that in Mabanag v. Lopez-Vito, this Court characterizing the
issue submitted thereto as a political one, declined to pass upon the
question whether or not a given number of votes cast in Congress in
favor of a proposed amendment to the Constitution-which was being
submitted to the people for ratification-satisfied the three-fourths vote
requirement of the fundamental law. The force of this precedent has
been weakened, however, by Suanes v. Chief Accountant of the
Senate, Avelino v. Cuenco, Tanada v. Cuenco, and Macias v.
Commission on Elections. In the first, we held that the officers and
employees of the Senate Electoral Tribunal are under its supervision
and control, not of that of the Senate President, as claimed by the
latter; in the second, this Court proceeded to determine the number of
Senators necessary for a quorum in the Senate; in the third, we nullified
the election, by Senators belonging to the party having the largest
number of votes in said chamber, purporting to act on behalf of the
party having the second largest number of votes therein, of two (2)
Senators belonging to the first party, as members, for the second party,
of the Senate Electoral Tribunal; and in the fourth, we declared
unconstitutional an act of Congress purporting to apportion the
representative districts for the House of Representatives upon the
ground that the apportionment had not been made as may be possible
according to the number of inhabitants of each province. Thus, we
rejected the theory, advanced in these four cases, that the issues
therein raised were political questions the determination of which is
beyond judicial review."27
The Court explained that the power to amend the Constitution or to
propose amendments thereto is not included in the general grant of
legislative powers to Congress. As a constituent assembly, the
members of Congress derive their authority from the fundamental law
and they do not have the final say on whether their acts are within or
beyond constitutional limits. 28 This ruling was reiterated in Tolentino
which held that acts of a constitutional convention called for the
purpose of proposing amendments to the Constitution are at par with
acts of Congress acting as a constituent assembly.29
In sum, this Court brushed aside the political question doctrine
and assumed jurisdiction whenever it found constitutionally-
imposed limits on the exercise of powers conferred upon the
Legislature.30
The Court hewed to the same line as regards the exercise of
Executive power. Thus, the respect accorded executive discretion was
observed in Severino v. Governor-General,31 where it was held that
the Governor-General, as head of the executive department, could not
be compelled by mandamus to call a special election in the town of
Silay for the purpose of electing a municipal president. Mandamus and
injunction could not lie to enforce or restrain a duty which is
discretionary. It was held that when the Legislature conferred upon the
Governor-General powers and duties, it did so for the reason that he
was in a better position to know the needs of the country than any other
member of the executive department, and with full confidence that he
will perform such duties as his best judgment dictates. 32
Similarly, in Abueva v. Wood,33 the Court held that the Governor-
General could not be compelled by mandamus to produce certain
vouchers showing the various expenditures of the Independence
Commission. Under the principle of separation of powers, it ruled that it
was not intended by the Constitution that one branch of government
could encroach upon the field of duty of the other. Each department has
an exclusive field within which it can perform its part within certain
discretionary limits.34 It observed that "the executive and legislative
departments of government are frequently called upon to deal with what
are known as political questions, with which the judicial department of
government has no intervention. In all such questions, the courts
uniformly refused to intervene for the purpose of directing or controlling
the actions of the other department; such questions being many times
reserved to those departments in the organic law of the state."35
In Forties v. Tiaco,36 the Court also refused to take cognizance of a
case enjoining the Chief Executive from deporting an obnoxious alien
whose continued presence in the Philippines was found by him to be
injurious to the public interest. It noted that sudden and unexpected
conditions may arise, growing out of the presence of untrustworthy
aliens, which demand immediate action. The President's inherent
power to deport undesirable aliens is universally denominated as
political, and this power continues to exist for the preservation of the
peace and domestic tranquility of the nation.37
In Manalang v. Quitoriano,38 the Court also declined to interfere in the
exercise of the President's appointing power. It held that the appointing
power is the exclusive prerogative of the President, upon which no
limitations may be imposed by Congress, except those resulting from
the need of securing concurrence of the Commission on Appointments
and from the exercise of the limited legislative power to prescribe
qualifications to a given appointive office.
We now come to the exercise by the President of his powers as
Commander-in-Chief vis-a-vis the political question doctrine. In the
1940's, this Court has held that as Commander-in-Chief of the Armed
Forces, the President has the power to determine whether war, in the
legal sense, still continues or has terminated. It ruled that it is within the
province of the political department and not of the judicial department of
government to determine when war is at end. 39
In 1952, the Court decided the landmark case of Montenegro v.
Castaneda.40 President Quirino suspended the privilege of the writ of
habeas corpus for persons detained or to be detained for crimes of
sedition, insurrection or rebellion. The Court, citing Barcelon, declared
that the authority to decide whether the exigency has arisen requiring
the suspension of the privilege belongs to the President and his
decision is final and conclusive on the courts.41
Barcelon was the ruling case law until the 1971 case of Lansang v.
Garcia came.42 Lansang reversed the previous cases and held that
the suspension of the privilege of the writ of habeas corpus was not a
political question. According to the Court, the weight of Barcelon was
diluted by two factors: (1) it relied heavily on Martin v. Mott, which
involved the U.S. President's power to call out the militia which is a
much broader power than suspension of the privilege of the writ; and
(2) the privilege was suspended by the American Governor-General
whose act, as representative of the sovereign affecting the freedom of
its subjects, could not be equated with that of the President of the
Philippines dealing with the freedom of the sovereign Filipino people.
The Court declared that the power to suspend the privilege of the
writ of habeas corpus is neither absolute nor unqualified because
the Constitution sets limits on the exercise of executive discretion
on the matter. These limits are: (1) that the privilege must not be
suspended except only in cases of invasion, insurrection or rebellion or
imminent danger thereof; and (2) when the public safety requires it, in
any of which events the same may be suspended wherever during such
period the necessity for the suspension shall exist. The extent of the
power which may be inquired into by courts is defined by these
limitations.43
On the vital issue of how the Court may inquire into the President's
exercise of power, it ruled that the function of the Court is not to
supplant but merely to check the Executive; to ascertain whether the
President has gone beyond the constitutional limits of his jurisdiction,
not to exercise the power vested in him or to determine the wisdom of
his act. Judicial inquiry is confined to the question of whether the
President did not act arbitrarily. 44 Using this yardstick, the Court found
that the President did not.
The emergency period of the 1970's flooded the Court with cases which
raised the political question defense. The issue divided the Court down
the middle. Javellana v. Executive Secretary 45 showed that while a
majority of the Court held that the issue of whether or not the 1973
Constitution had been ratified in accordance with the 1935 Constitution
was justiciable, a majority also ruled that the decisive issue of whether
the 1973 Constitution had come into force and effect, with or without
constitutional ratification, was a political question.46
The validity of the declaration of martial law by then President Marcos
was next litigated before the Court. In Aquino, Jr. v. Enrile,47 it upheld
the President's declaration of martial law. On whether the validity of the
imposition of martial law was a political or justiciable question, the Court
was almost evenly divided. One-half embraced the political question
position and the other half subscribed to the justiciable position in
Lansang. Those adhering to the political question doctrine used
different methods of approach to it.48
In 1983, the Lansang ruling was weakened by the Court in Garcia-
Padilla v. Enrile.49 The petitioners therein were arrested and detained
by the Philippine Constabulary by virtue of a Presidential Commitment
Order (PCO). Petitioners sought the issuance of a writ of habeas
corpus. The Court found that the PCO had the function of validating a
person's detention for any of the offenses covered in Proclamation No.
2045 which continued in force the suspension of the privilege of the writ
of habeas corpus. It held that the issuance of the PCO by the President
was not subject to judicial inquiry. 50 It went further by declaring that
there was a need to re-examine Lansang with a view to reverting to
Barcelon and Montenegro. It observed that in times of war or national
emergency, the President must be given absolute control for the very
life of the nation and government is in great peril. The President, it
intoned, is answerable only to his conscience, the people, and God.51
But barely six (6) days after Garcia-Padilla, the Court promulgated
Morales, Jr. v. Enrile52 reiterating Lansang. It held that by the power
of judicial review, the Court must inquire into every phase and aspect of
a person's detention from the moment he was taken into custody up to the intent of the people through the discussions and deliberations of
the moment the court passes upon the merits of the petition. Only after their representatives.56 The conventional wisdom is that the Constitution
such a scrutiny can the court satisfy itself that the due process clause does not derive its force from the convention which framed it, but from
of the Constitution has been met.53 the people who ratified it, the intent to be arrived at is that of the
It is now history that the improper reliance by the Court on the people.57
political question doctrine eroded the people's faith in its capacity It is true that the third paragraph of Section 18, Article VII of the
to check abuses committed by the then Executive in the exercise 1987 Constitution expressly gives the Court the power to review
of his commander-in-chief powers, particularly violations against the sufficiency of the factual bases used by the President in the
human rights. The refusal of courts to be pro-active in the exercise suspension of the privilege of the writ of habeas corpus and the
of its checking power drove the people to the streets to resort to declaration of martial law. It does not follow, however, that just
extralegal remedies. They gave birth to EDSA. because the same provision did not grant to this Court the power
Two lessons were not lost to the members of the Constitutional to review the exercise of the calling out power by the President,
Commission that drafted the 1987 Constitution. The first was the need ergo, this Court cannot pass upon the validity of its exercise.
to grant this Court the express power to review the exercise of the Given the light of our constitutional history, this express grant of
powers as commander-in-chief by the President and deny it of any power merely means that the Court cannot decline the exercise of
discretion to decline its exercise. The second was the need to its power because of the political question doctrine as it did in the
compel the Court to be pro-active by expanding its jurisdiction and, past. In fine, the express grant simply stresses the mandatory
thus, reject its laid back stance against acts constituting grave abuse of duty of this Court to check the exercise of the commander-in-chief
discretion on the part of any branch or instrumentality of government. powers of the President. It eliminated the discretion of the Court
Then Chief Justice Roberto Concepcion, a member of the not to wield its power of review thru the use of the political
Constitutional Commission, worked for the insertion of the second question doctrine.
paragraph of Section 1, Article VIII in the draft Constitution, 54 which It may be conceded that the calling out power may be a "lesser power"
reads: compared to the power to suspend the privilege of the writ of habeas
"Sec. 1. x x x. corpus and the power to declare martial law. Even then, its exercise
Judicial power includes the duty of the courts of justice to settle actual cannot be left to the absolute discretion of the Chief Executive as
controversies involving rights which are legally demandable and Commander-in-Chief of the armed forces, as its impact on the rights of
enforceable, and to determine whether or not there has been a our people protected by the Constitution cannot be downgraded. We
grave abuse of discretion amounting to lack or excess of cannot hold that acts of the commander-in-chief cannot be reviewed on
jurisdiction on the part of any branch or instrumentality of the the ground that they have lesser impact on the civil and political rights
Government." of our people. The exercise of the calling out power may be "benign" in
the case at bar but may not be so in future cases.
The language of the provision clearly gives the Court the power to
strike down acts amounting to grave abuse of discretion of both the The counsel of Mr. Chief Justice Enrique M. Fernando, in his
legislative and executive branches of government. Dissenting and Concurring Opinion in Lansang that it would be
dangerous and misleading to push the political question doctrine too
We should interpret Section 18, Article VII of the 1987 Constitution in
far, is apropos. It will not be complementary to the Court if it handcuffs
light of our constitutional history. The provision states:
itself to helplessness when a grievously injured citizen seeks relief from
"Sec. 18. The President shall be the Commander-in-Chief of all a palpably unwarranted use of presidential or military power, especially
armed forces of the Philippines and whenever it becomes when the question at issue falls in the penumbra between the "political"
necessary, he may call out such armed forces to prevent or and the "justiciable. "58
suppress lawless violence, invasion or rebellion. In case of
We should not water down the ruling that deciding whether a matter
invasion or rebellion, when the public safety requires it, he may,
has been committed by the Constitution to another branch of
for a period not exceeding sixty days, suspend the privilege of the
government, or whether the action of that branch exceeds whatever
writ of habeas corpus or place the Philippines or any part thereof
authority has been committed, is a delicate exercise in constitutional
under martial law. Within forty-eight hours from the proclamation of
interpretation, and is a responsibility of the Court as ultimate
martial law or the suspension of the privilege of the writ of habeas
interpreter of the fundamental law.59 When private justiciable rights
corpus, the President shall submit a report in person or in writing to
are involved in a suit, the Court must not refuse to assume
Congress. The Congress, voting jointly, by a vote of at least a majority
jurisdiction even though questions of extreme political importance are
of all its Members in regular or special session, may revoke such
necessarily involved.60 Every officer under a constitutional government
proclamation or suspension, which revocation shall not be set aside by
must act according to law and subject to the controlling power of the
the President. Upon the initiative of the President, the Congress may, in
people, acting through the courts, as well as through the executive and
the same manner, extend such proclamation or suspension for a period
legislative. One department is just as representative of the other, and
to be determined by Congress, if the invasion or rebellion shall persist
the judiciary is the department which is charged with the special duty of
and public safety requires it.
determining the limitations which the law places upon all official
The Congress, if not in session, shall, within twenty-four hours following action.61 This historic role of the Court is the foundation stone of a
such proclamation or suspension, convene in accordance with its rules government of laws and not of men.62
without need of a call.
I join the Decision in its result.
The Supreme Court may review, in an appropriate proceeding filed
by any citizen, the sufficiency of the factual basis of the
proclamation of martial law or the suspension of the privilege of
the writ or the extension thereof, and must promulgate its decision
thereon within thirty days from its filing.
x x x."
It is clear from the foregoing that the President, as Commander-in-
Chief of the armed forces of the Philippines, may call out the
armed forces subject to two conditions: (1) whenever it becomes
necessary; and (2) to prevent or suppress lawless violence,
invasion or rebellion. Undeniably, these conditions lay down the
sine qua requirement for the exercise of the power and the
objective sought to be attained by the exercise of the power. They
define the constitutional parameters of the calling out power.
Whether or not there is compliance with these parameters is a
justiciable issue and is not a political question.
I am not unaware that in the deliberations of the Constitutional
Commission, Commissioner Bernas opined that the President's
exercise of the "calling out power," unlike the suspension of the
privilege of the writ of habeas corpus and the declaration of martial law,
is not a justiciable issue but a political question and therefore not
subject to judicial review.
It must be borne in mind, however, that while a member's opinion
expressed on the floor of the Constitutional Convention is valuable, it is
not necessarily expressive of the people's intent. 55 The proceedings of
the Convention are less conclusive on the proper construction of the
fundamental law than are legislative proceedings of the proper
construction of a statute, for in the latter case it is the intent of the
legislature the courts seek, while in the former, courts seek to arrive at
G.R. No. 131719             May 25, 2004
THE EXECUTIVE SECRETARY, THE SECRETARY OF JUSTICE,
THE SECRETARY OF LABOR AND EMPLOYMENT, AND THE
SECRETARY OF FOREIGN AFFAIRS, OWWA PUNO,
ADMINISTRATOR, and POEA ADMINISTRATOR, petitioners,
vs.
THE HON. COURT OF APPEALS and ASIAN RECRUITMENT
COUNCIL PHILIPPINE CHAPTER (ARCO-PHIL.), INC., representing
its members: Worldcare Services Internationale, Inc., Steadfast
International Recruitment Corporation, Dragon International
Manpower Services Corporation, Verdant Manpower Mobilization
Corporation, Brent Overseas Personnel, Inc., ARL Manpower
Services, Inc., Dahlzhen International Services, Inc., Interworld
Placement Center, Inc., Lakas Tao Contract Services, Ltd. Co., and
SSC Multiservices, respondents.
DECISION
CALLEJO, SR., J.:
In this petition for review on certiorari, the Executive Secretary of the
President of the Philippines, the Secretary of Justice, the Secretary of
Foreign Affairs, the Secretary of Labor and Employment, the POEA
Administrator and the OWWA Administrator, through the Office of the
Solicitor General, assail the Decision 1 of the Court of Appeals in CA-
G.R. SP No. 38815 affirming the Order 2 of the Regional Trial Court of
Quezon City dated August 21, 1995 in Civil Case No. Q-95-24401,
granting the plea of the petitioners therein for a writ of preliminary
injunction and of the writ of preliminary injunction issued by the trial
court on August 24, 1995.
The Antecedents
Republic Act No. 8042, otherwise known as the Migrant Workers and
Overseas Filipinos Act of 1995, took effect on July 15, 1995. The
Omnibus Rules and Regulations Implementing the Migrant Workers
and Overseas Filipino Act of 1995 was, thereafter, published in the April
7, 1996 issue of the Manila Bulletin. However, even before the law took
effect, the Asian Recruitment Council Philippine Chapter, Inc. (ARCO-
Phil.) filed, on July 17, 1995, a petition for declaratory relief under Rule
63 of the Rules of Court with the Regional Trial Court of Quezon City to
declare as unconstitutional Section 2, paragraph (g), Section 6,
paragraphs (a) to (j), (l) and (m), Section 7, paragraphs (a) and (b), and
Sections 9 and 10 of the law, with a plea for the issuance of a
temporary restraining order and/or writ of preliminary injunction
enjoining the respondents therein from enforcing the assailed
provisions of the law.
In a supplement to its petition, the ARCO-Phil. alleged that Rep. Act
No. 8042 was self-executory and that no implementing rules were
needed. It prayed that the court issue a temporary restraining order to
enjoin the enforcement of Section 6, paragraphs (a) to (m) on illegal
recruitment, Section 7 on penalties for illegal recruitment, and Section 9
on venue of criminal actions for illegal recruitments, viz:
Viewed in the light of the foregoing discussions, there appears
to be urgent an imperative need for this Honorable Court to
maintain the status quo by enjoining the implementation or
effectivity of the questioned provisions of RA 8042, by way of
a restraining order otherwise, the member recruitment
agencies of the petitioner will suffer grave or irreparable
damage or injury. With the effectivity of RA 8042, a great
majority of the duly licensed recruitment agencies have
stopped or suspended their operations for fear of being
prosecuted under the provisions of a law that are unjust and
unconstitutional. This Honorable Court may take judicial
notice of the fact that processing of deployment papers of
overseas workers for the past weeks have come to a standstill
at the POEA and this has affected thousands of workers
everyday just because of the enactment of RA 8042. Indeed,
this has far reaching effects not only to survival of the
overseas manpower supply industry and the active
participating recruitment agencies, the country’s economy
which has survived mainly due to the dollar remittances of the
overseas workers but more importantly, to the poor and the
needy who are in dire need of income-generating jobs which
can only be obtained from abroad. The loss or injury that the
recruitment agencies will suffer will then be immeasurable and
irreparable. As of now, even foreign employers have already
reduced their manpower requirements from the Philippines
due to their knowledge that RA 8042 prejudiced and
adversely affected the local recruitment agencies.3
On August 1, 1995, the trial court issued a temporary restraining order
effective for a period of only twenty (20) days therefrom.
After the petitioners filed their comment on the petition, the ARCO-Phil.
filed an amended petition, the amendments consisting in the inclusion
in the caption thereof eleven (11) other corporations which it alleged
were its members and which it represented in the suit, and a plea for a
temporary restraining order enjoining the respondents from enforcing
Section 6 subsection (i), Section 6 subsection (k) and paragraphs 15
and 16 thereof, Section 8, Section 10, paragraphs 1 and 2, and
Sections 11 and 40 of Rep. Act No. 8042.
The respondent ARCO-Phil. assailed Section 2(g) and (i), Section 6
subsection (a) to (m), Section 7(a) to (b), and Section 10 paragraphs
(1) and (2), quoted as follows:
(g) THE STATE RECOGNIZES THAT THE ULTIMATE
PROTECTION TO ALL MIGRANT WORKERS IS THE
POSSESSION OF SKILLS. PURSUANT TO THIS AND AS
SOON AS PRACTICABLE, THE GOVERNMENT SHALL
DEPLOY AND/OR ALLOW THE DEPLOYMENT ONLY OF
SKILLED FILIPINO WORKERS.4
Sec. 2 subsection (i, 2nd par.)
Nonetheless, the deployment of Filipino overseas workers,
whether land-based or sea-based, by local service contractors
and manning agents employing them shall be encourages
(sic). Appropriate incentives may be extended to them.
…
II. ILLEGAL RECRUITMENT
SEC. 6. Definition. – For purposes of this Act, illegal
recruitment shall mean any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring, or procuring workers
and includes referring, contract services, promising or
advertising for employment abroad, whether for profit or not,
when undertaken by a non-licensee or non-holder of authority
contemplated under Article 13(f) of Presidential Decree No.
442, as amended, otherwise known as the Labor Code of the
Philippines: Provided, That any such non-licensee or non-
holder who, in any manner, offers or promises for a fee
employment abroad to two or more persons shall be deemed
so engaged. It shall, likewise, include the following acts,
whether committed by any person, whether a non-licensee,
non-holder, licensee or holder of authority:
(a) To charge or accept directly or indirectly any
amount greater than that specified in the schedule of
allowable fees prescribed by the Secretary of Labor
and Employment, or to make a worker pay any
amount greater than that actually received by him as
a loan or advance;
(b) To furnish or publish any false notice or
information or document in relation to recruitment or
employment;
(c) To give any false notice, testimony, information
or document or commit any act of misrepresentation
for the purpose of securing a license or authority
under the Labor Code;
(d) To induce or attempt to induce a worker already
employed to quit his employment in order to offer
him another unless the transfer is designed to
liberate a worker from oppressive terms and
conditions of employment;
(e) To influence or attempt to influence any person
or entity not to employ any worker who has not
applied for employment through his agency;
(f) To engage in the recruitment or placement of
workers in jobs harmful to public health or morality
or to the dignity of the Republic of the Philippines;
(g) To obstruct or attempt to obstruct inspection by
the Secretary of Labor and Employment or by his
duly authorized representative;
(h) To fail to submit reports on the status of
employment, placement vacancies, remittance of
foreign exchange earnings, separation from jobs,
departures and such other matters or information as
may be required by the Secretary of Labor and
Employment;
(i) To substitute or alter to the prejudice of the
worker, employment contracts approved and verified
by the Department of Labor and Employment from
the time of actual signing thereof by the parties up to
and including the period of the expiration of the
same without the approval of the Department of
Labor and Employment;
(j) For an officer or agent of a recruitment or
placement agency to become an officer or member
of the Board of any corporation engaged in travel
agency or to be engaged directly or indirectly in the
management of a travel agency;
(k) To withhold or deny travel documents from
applicant workers before departure for monetary or
financial considerations other than those authorized
under the Labor Code and its implementing rules
and regulations;
(l) Failure to actually deploy without valid reason as
determined by the Department of Labor and
Employment; and
 (m) Failure to reimburse expenses incurred by the
worker in connection with his documentation and
processing for purposes of deployment, in cases
where the deployment does not actually take place
without the worker’s fault. Illegal recruitment when
committed by a syndicate or in large scale shall be
considered an offense involving economic sabotage.
Illegal recruitment is deemed committed by a syndicate if
carried out by a group of three (3) or more persons conspiring
or confederating with one another. It is deemed committed in
large scale if committed against three (3) or more persons
individually or as a group.
The persons criminally liable for the above offenses are the
principals, accomplices and accessories. In case of juridical
persons, the officers having control, management or direction
of their business shall be liable.
…
SEC. 7. Penalties. –
(a) Any person found guilty of illegal recruitment shall suffer
the penalty of imprisonment of not less than six (6) years and
one (1) day but not more than twelve (12) years and a fine of
not less than two hundred thousand pesos (₱200,000.00) nor
more than five hundred thousand pesos (₱500,000.00).
(b) The penalty of life imprisonment and a fine of not less than
five hundred thousand pesos (₱500,000.00) nor more than
one million pesos (₱1,000,000.00) shall be imposed if illegal
recruitment constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be
imposed if the person illegally recruited is less than eighteen
(18) years of age or committed by a non-licensee or non-
holder of authority.
Sec. 8.
Prohibition on Officials and Employees. – It shall be unlawful
for any official or employee of the Department of Labor and
Employment, the Philippine Overseas Employment
Administration (POEA), or the Overseas Workers Welfare
Administration (OWWA), or the Department of Foreign Affairs,
or other government agencies involved in the implementation
of this Act, or their relatives within the fourth civil degree of
consanguinity or affinity, to engage, directly or indirectly, in
the business of recruiting migrant workers as defined in this
Act. The penalties provided in the immediate preceding
paragraph shall be imposed upon them. (underscoring
supplied)
… involving economic sabotage, upon a finding that it committed any of
Sec. 10, pars. 1 & 2.
Money Claims. – Notwithstanding any provision of law to the
contrary, the Labor Arbiters of the National Labor Relations
Commission (NLRC) shall have the original and exclusive
jurisdiction to hear and decide, within ninety (90) calendar
days after the filing of the complaint, the claims arising out of
an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment
including claims for actual, moral, exemplary and other forms
of damages.
The liability of the principal/employer and the
recruitment/placement agency for any and all claims under
this section shall be joint and several. This provision shall be
incorporated in the contract for overseas employment and
shall be a condition precedent for its approval. The
performance bond to be filed by the recruitment/placement
agency, as provided by law, shall be answerable for all money
claims or damages that may be awarded to the workers. If the
recruitment/placement agency is a juridical being, the
corporate officers and directors and partners as the case may
be, shall themselves be jointly and solidarily liable with the
corporation or partnership for the aforesaid claims and
damages.
… Trial Court of the province or city where the offense was
SEC. 11. Mandatory Periods for Resolution of Illegal
Recruitment Cases. – The preliminary investigations of cases
under this Act shall be terminated within a period of thirty (30)
calendar days from the date of their filing. Where the
preliminary investigation is conducted by a prosecution officer
and a prima facie case is established, the corresponding
information shall be filed in court within twenty-four (24) hours
from the termination of the investigation. If the preliminary
investigation is conducted by a judge and a prima facie case
is found to exist, the corresponding information shall be filed
by the proper prosecution officer within forty-eight (48) hours
from the date of receipt of the records of the case.
The respondent averred that the aforequoted provisions of Rep. Act No.
8042 violate Section 1, Article III of the Constitution. 5 According to the
respondent, Section 6(g) and (i) discriminated against unskilled workers
and their families and, as such, violated the equal protection clause, as
well as Article II, Section 12 6 and Article XV, Sections 1 7 and 3(3) of the
Constitution.8 As the law encouraged the deployment of skilled Filipino
workers, only overseas skilled workers are granted rights. The
respondent stressed that unskilled workers also have the right to seek
employment abroad. According to the respondent, the right of unskilled
workers to due process is violated because they are prevented from
finding employment and earning a living abroad. It cannot be argued
that skilled workers are immune from abuses by employers, while
unskilled workers are merely prone to such abuses. It was pointed out
that both skilled and unskilled workers are subjected to abuses by
foreign employers. Furthermore, the prohibition of the deployment of
unskilled workers abroad would only encourage fly-by-night illegal
recruiters.
According to the respondent, the grant of incentives to service
contractors and manning agencies to the exclusion of all other licensed
and authorized recruiters is an invalid classification. Licensed and
authorized recruiters are thus deprived of their right to property and due
process and to the "equality of the person." It is understandable for the
law to prohibit illegal recruiters, but to discriminate against licensed and
registered recruiters is unconstitutional.
The respondent, likewise, alleged that Section 6, subsections (a) to (m)
is unconstitutional because licensed and authorized recruitment
agencies are placed on equal footing with illegal recruiters. It contended
that while the Labor Code distinguished between recruiters who are
holders of licenses and non-holders thereof in the imposition of
penalties, Rep. Act No. 8042 does not make any distinction. The
penalties in Section 7(a) and (b) being based on an invalid classification
are, therefore, repugnant to the equal protection clause, besides being
excessive; hence, such penalties are violative of Section 19(1), Article
III of the Constitution.9 It was also pointed out that the penalty for
officers/officials/employees of recruitment agencies who are found
guilty of economic sabotage or large-scale illegal recruitment under
Rep. Act No. 8042 is life imprisonment. Since recruitment agencies
usually operate with a manpower of more than three persons, such
agencies are forced to shut down, lest their officers and/or employees
be charged with large scale illegal recruitment or economic sabotage
and sentenced to life imprisonment. Thus, the penalty imposed by law,
being disproportionate to the prohibited acts, discourages the business
of licensed and registered recruitment agencies.
The respondent also posited that Section 6(m) and paragraphs (15)
and (16), Sections 8, 9 and 10, paragraph 2 of the law violate Section
22, Article III of the Constitution 10 prohibiting ex-post facto laws and bills
of attainder. This is because the provisions presume that a licensed
and registered recruitment agency is guilty of illegal recruitment
the prohibited acts under the law. Furthermore, officials, employees and
their relatives are presumed guilty of illegal recruitment involving
economic sabotage upon such finding that they committed any of the
said prohibited acts.
The respondent further argued that the 90-day period in Section 10,
paragraph (1) within which a labor arbiter should decide a money claim
is relatively short, and could deprive licensed and registered recruiters
of their right to due process. The period within which the summons and
the complaint would be served on foreign employees and, thereafter,
the filing of the answer to the complaint would take more than 90 days.
This would thereby shift on local licensed and authorized recruiters the
burden of proving the defense of foreign employers. Furthermore, the
respondent asserted, Section 10, paragraph 2 of the law, which
provides for the joint and several liability of the officers and employees,
is a bill of attainder and a violation of the right of the said corporate
officers and employees to due process. Considering that such
corporate officers and employees act with prior approval of the board of
directors of such corporation, they should not be liable, jointly and
severally, for such corporate acts.
The respondent asserted that the following provisions of the law are
unconstitutional:
SEC. 9. Venue. – A criminal action arising from illegal
recruitment as defined herein shall be filed with the Regional
committed or where the offended party actually resides at the
time of the commission of the offense: Provided, That the
court where the criminal action is first filed shall acquire
jurisdiction to the exclusion of other courts: Provided,
however, That the aforestated provisions shall also apply to
those criminal actions that have already been filed in court at
the time of the effectivity of this Act.
…
SEC. 10. Money Claims. – Notwithstanding any provision of
law to the contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the original and
exclusive jurisdiction to hear and decide, within ninety (90)
calendar days after the filing of the complaint, the claims
arising out of an employer-employee relationship or by virtue
 of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and
other forms of damages.
Sec. 40.
The departments and agencies charged with carrying out the
provisions of this Act shall, within ninety (90) days after the
effectiviy of this Act, formulate the necessary rules and
regulations for its effective implementation.
According to the respondent, the said provisions violate Section 5(5),
Article VIII of the Constitution11 because they impair the power of the
Supreme Court to promulgate rules of procedure.
In their answer to the petition, the petitioners alleged, inter alia, that (a)
the respondent has no cause of action for a declaratory relief; (b) the
petition was premature as the rules implementing Rep. Act No. 8042
not having been released as yet; (c) the assailed provisions do not
violate any provisions of the Constitution; and, (d) the law was
approved by Congress in the exercise of the police power of the State.
In opposition to the respondent’s plea for injunctive relief, the
petitioners averred that:
As earlier shown, the amended petition for declaratory relief is devoid of
merit for failure of petitioner to demonstrate convincingly that the
assailed law is unconstitutional, apart from the defect and impropriety of
the petition. One who attacks a statute, alleging unconstitutionality must
prove its invalidity beyond reasonable doubt (Caleon v. Agus
Development Corporation, 207 SCRA 748). All reasonable doubts
should be resolved in favor of the constitutionality of a statute (People
v. Vera, 65 Phil. 56). This presumption of constitutionality is based on
the doctrine of separation of powers which enjoin upon each
department a becoming respect for the acts of the other departments
(Garcia vs. Executive Secretary, 204 SCRA 516 [1991]). Necessarily,
the ancillary remedy of a temporary restraining order and/or a writ of
preliminary injunction prayed for must fall. Besides, an act of legislature
approved by the executive is presumed to be within constitutional
bounds (National Press Club v. Commission on Elections, 207 SCRA
1).12
After the respective counsels of the parties were heard on oral
arguments, the trial court issued on August 21, 1995, an order granting
the petitioner’s plea for a writ of preliminary injunction upon a bond of
₱50,000. The petitioner posted the requisite bond and on August 24,
1995, the trial court issued a writ of preliminary injunction enjoining the
enforcement of the following provisions of Rep. Act No. 8042 pending
the termination of the proceedings:
… Section 2, subsections (g) and (i, 2nd par.); Section 6,
subsections (a) to (m), and pars. 15 & 16; Section 7,
subsections (a) & (b); Section 8; Section 9; Section 10; pars.
1 & 2; Section 11; and Section 40 of Republic Act No. 8042,
otherwise known as the Migrant Workers and Overseas
Filipinos Act of 1995. …13
The petitioners filed a petition for certiorari with the Court of Appeals
assailing the order and the writ of preliminary injunction issued by the
trial court on the following grounds:
1. Respondent ARCO-PHIL. had utterly failed to show its
clear right/s or that of its member-agencies to be protected by
the injunctive relief and/or violation of said rights by the
enforcement of the assailed sections of R.A. 8042;
2. Respondent Judge fixed a ₱50,000 injunction bond which
is grossly inadequate to answer for the damage which
petitioner-officials may sustain, should respondent ARCO-
PHIL. be finally adjudged as not being entitled thereto.14
The petitioners asserted that the respondent is not the real party-in-
interest as petitioner in the trial court. It is inconceivable how the
respondent, a non-stock and non-profit corporation, could sustain direct
injury as a result of the enforcement of the law. They argued that if, at
all, any damage would result in the implementation of the law, it is the
licensed and registered recruitment agencies and/or the unskilled
Filipino migrant workers discriminated against who would sustain the
said injury or damage, not the respondent. The respondent, as
petitioner in the trial court, was burdened to adduce preponderant
evidence of such irreparable injury, but failed to do so. The petitioners
further insisted that the petition a quo was premature since the rules
and regulations implementing the law had yet to be promulgated when
such petition was filed. Finally, the petitioners averred that the
respondent failed to establish the requisites for the issuance of a writ of
preliminary injunction against the enforcement of the law and the rules
and regulations issued implementing the same.
On December 5, 1997, the appellate court came out with a four-page
decision dismissing the petition and affirming the assailed order and
writ of preliminary injunction issued by the trial court. The appellate
court, likewise, denied the petitioners’ motion for reconsideration of the
said decision.
The petitioners now come to this Court in a petition for review on
certiorari on the following grounds:
1. Private respondent ARCO-PHIL. had utterly failed to show
its clear right/s or that of its member-agencies to be protected
by the injunctive relief and/or violation of said rights by the
enforcement of the assailed sections of R.A. 8042;
2. The ₱50,000 injunction bond fixed by the court a quo and
sustained by the Court of Appeals is grossly inadequate to
answer for the damage which petitioners-officials may sustain,
should private respondent ARCO-PHIL. be finally adjudged as
not being entitled thereto.15
On February 16, 1998, this Court issued a temporary restraining order
enjoining the respondents from enforcing the assailed order and writ of
preliminary injunction.
The Issues
The core issue in this case is whether or not the trial court committed
grave abuse of its discretion amounting to excess or lack of jurisdiction
in issuing the assailed order and the writ of preliminary injunction on a
bond of only ₱50,000 and whether or not the appellate court erred in
affirming the trial court’s order and the writ of preliminary injunction
issued by it.
The petitioners contend that the respondent has no locus standi. It is a
non-stock, non-profit organization; hence, not the real party-in-interest
as petitioner in the action. Although the respondent filed the petition in
the Regional Trial Court in behalf of licensed and registered recruitment
agencies, it failed to adduce in evidence a certified copy of its Articles
of Incorporation and the resolutions of the said members authorizing it
to represent the said agencies in the proceedings. Neither is the suit of
the respondent a class suit so as to vest in it a personality to assail
Rep. Act No. 8042; the respondent is service-oriented while the
recruitment agencies it purports to represent are profit-oriented. The
petitioners assert that the law is presumed constitutional and, as such,
the respondent was burdened to make a case strong enough to
overcome such presumption and establish a clear right to injunctive
relief.
The petitioners bewail the ₱50,000 bond fixed by the trial court for the
issuance of a writ of preliminary injunction and affirmed by the appellate
court. They assert that the amount is grossly inadequate to answer for
any damages that the general public may suffer by reason of the non-
enforcement of the assailed provisions of the law. The trial court
committed a grave abuse of its discretion in granting the respondent’s
plea for injunctive relief, and the appellate court erred in affirming the
order and the writ of preliminary injunction issued by the trial court.
The respondent, for its part, asserts that it has duly established its locus
standi and its right to injunctive relief as gleaned from its pleadings and
the appendages thereto. Under Section 5, Rule 58 of the Rules of
Court, it was incumbent on the petitioners, as respondents in the RTC,
to show cause why no injunction should issue. It avers that the
injunction bond posted by the respondent was more than adequate to
answer for any injury or damage the petitioners may suffer, if any, by
reason of the writ of preliminary injunction issued by the RTC. In any
event, the assailed provisions of Rep. Act No. 8042 exposed its
members to the immediate and irreparable damage of being deprived
of their right to a livelihood without due process, a property right
protected under the Constitution.
The respondent contends that the commendable purpose of the law to
eradicate illegal recruiters should not be done at the expense and to the
prejudice of licensed and authorized recruitment agencies. The writ of
preliminary injunction was necessitated by the great number of duly
licensed recruitment agencies that had stopped or suspended their
business operations for fear that their officers and employees would be
indicted and prosecuted under the assailed oppressive penal provisions
of the law, and meted excessive penalties. The respondent, likewise,
urges that the Court should take judicial notice that the processing of
deployment papers of overseas workers have come to a virtual
standstill at the POEA.
The Court’s Ruling
The petition is meritorious.
The Respondent Has Locus Standi
To File the Petition in the RTC in Representation of the Eleven
Licensed and Registered Recruitment Agencies Impleaded in the
Amended Petition
The modern view is that an association has standing to complain of
injuries to its members. This view fuses the legal identity of an
association with that of its members.16 An association has standing to
file suit for its workers despite its lack of direct interest if its members
are affected by the action. An organization has standing to assert the
concerns of its constituents.17
In Telecommunications and Broadcast Attorneys of the Philippines v.
Commission on Elections,18 we held that standing jus tertii would be
recognized only if it can be shown that the party suing has some
substantial relation to the third party, or that the right of the third party
would be diluted unless the party in court is allowed to espouse the
third party’s constitutional claims.
In this case, the respondent filed the petition for declaratory relief under
Rule 64 of the Rules of Court for and in behalf of its eleven (11)
licensed and registered recruitment agencies which are its members,
and which approved separate resolutions expressly authorizing the
respondent to file the said suit for and in their behalf. We note that,
under its Articles of Incorporation, the respondent was organized for the
purposes inter alia of promoting and supporting the growth and
development of the manpower recruitment industry, both in the local
and international levels; providing, creating and exploring employment
opportunities for the exclusive benefit of its general membership;
enhancing and promoting the general welfare and protection of Filipino
workers; and, to act as the representative of any individual, company,
entity or association on matters related to the manpower recruitment
industry, and to perform other acts and activities necessary to
accomplish the purposes embodied therein. The respondent is, thus,
the appropriate party to assert the rights of its members, because it and
its members are in every practical sense identical. The respondent
asserts that the assailed provisions violate the constitutional rights of its
members and the officers and employees thereof. The respondent is
but the medium through which its individual members seek to make
more effective the expression of their voices and the redress of their
grievances.19
However, the respondent has no locus standi to file the petition for and
in behalf of unskilled workers. We note that it even failed to implead any
unskilled workers in its petition. Furthermore, in failing to implead, as
parties-petitioners, the eleven licensed and registered recruitment
agencies it claimed to represent, the respondent failed to comply with
Section 2 of Rule 6320 of the Rules of Court. Nevertheless, since the
eleven licensed and registered recruitment agencies for which the
respondent filed the suit are specifically named in the petition, the
amended petition is deemed amended to avoid multiplicity of suits. 21
The Assailed Order and Writ of
Preliminary Injunction Is Mooted
By Case Law
The respondent justified its plea for injunctive relief on the allegation in
its amended petition that its members are exposed to the immediate
and irreparable danger of being deprived of their right to a livelihood
and other constitutional rights without due process, on its claim that a
great number of duly licensed recruitment agencies have stopped or
suspended their operations for fear that (a) their officers and employees
would be prosecuted under the unjust and unconstitutional penal
provisions of Rep. Act No. 8042 and meted equally unjust and
excessive penalties, including life imprisonment, for illegal recruitment
and large scale illegal recruitment without regard to whether the
recruitment agencies involved are licensed and/or authorized; and, (b) if
the members of the respondent, which are licensed and authorized,
decide to continue with their businesses, they face the stigma and the
curse of being labeled "illegal recruiters." In granting the respondent’s
plea for a writ of preliminary injunction, the trial court held, without
stating the factual and legal basis therefor, that the enforcement of Rep.
Act No. 8042, pendente lite, would cause grave and irreparable injury to
the respondent until the case is decided on its merits.
We note, however, that since Rep. Act No. 8042 took effect on July 15,
1995, the Court had, in a catena of cases, applied the penal provisions
in Section 6, including paragraph (m) thereof, and the last two
paragraphs therein defining large scale illegal recruitment committed by
officers and/or employees of recruitment agencies by themselves and
in connivance with private individuals, and imposed the penalties
provided in Section 7 thereof, including the penalty of life
imprisonment.22 The Informations therein were filed after preliminary
investigations as provided for in Section 11 of Rep. Act No. 8042 and in
venues as provided for in Section 9 of the said act. In People v.
Chowdury,23 we held that illegal recruitment is a crime of economic
sabotage and must be enforced.
In People v. Diaz,24 we held that Rep. Act No. 8042 is but an
amendment of the Labor Code of the Philippines and is not an ex-post
facto law because it is not applied retroactively. In JMM Promotion and
Management, Inc. v. Court of Appeals,25 the issue of the extent of the
police power of the State to regulate a business, profession or calling
vis-à-vis the equal protection clause and the non-impairment clause of
the Constitution were raised and we held, thus:
A profession, trade or calling is a property right within the
meaning of our constitutional guarantees. One cannot be
deprived of the right to work and the right to make a living
because these rights are property rights, the arbitrary and
unwarranted deprivation of which normally constitutes an
actionable wrong.
Nevertheless, no right is absolute, and the proper regulation
of a profession, calling, business or trade has always been
upheld as a legitimate subject of a valid exercise of the police
power by the state particularly when their conduct affects
either the execution of legitimate governmental functions, the
preservation of the State, the public health and welfare and
public morals. According to the maxim, sic utere tuo ut
alienum non laedas, it must of course be within the legitimate
range of legislative action to define the mode and manner in
which every one may so use his own property so as not to
pose injury to himself or others.
In any case, where the liberty curtailed affects at most the
rights of property, the permissible scope of regulatory
measures is certainly much wider. To pretend that licensing or
accreditation requirements violates the due process clause is
to ignore the settled practice, under the mantle of the police
power, of regulating entry to the practice of various trades or
professions. Professionals leaving for abroad are required to
pass rigid written and practical exams before they are
deemed fit to practice their trade. Seamen are required to
take tests determining their seamanship. Locally, the
Professional Regulation Commission has begun to require
previously licensed doctors and other professionals to furnish
documentary proof that they had either re-trained or had
undertaken continuing education courses as a requirement for
renewal of their licenses. It is not claimed that these
requirements pose an unwarranted deprivation of a property
right under the due process clause. So long as professionals
and other workers meet reasonable regulatory standards no
such deprivation exists.
Finally, it is a futile gesture on the part of petitioners to invoke
the non-impairment clause of the Constitution to support their
argument that the government cannot enact the assailed
regulatory measures because they abridge the freedom to
contract. In Philippine Association of Service Exporters, Inc.
vs. Drilon, we held that "[t]he non-impairment clause of the
Constitution … must yield to the loftier purposes targeted by
the government." Equally important, into every contract is
read provisions of existing law, and always, a reservation of
the police power for so long as the agreement deals with a
subject impressed with the public welfare.
A last point. Petitioners suggest that the singling out of
entertainers and performing artists under the assailed
department orders constitutes class legislation which violates
the equal protection clause of the Constitution. We do not
agree.
The equal protection clause is directed principally against
undue favor and individual or class privilege. It is not intended
to prohibit legislation which is limited to the object to which it
is directed or by the territory in which it is to operate. It does
not require absolute equality, but merely that all persons be
treated alike under like conditions both as to privileges
conferred and liabilities imposed. We have held, time and
again, that the equal protection clause of the Constitution
does not forbid classification for so long as such classification
is based on real and substantial differences having a
reasonable relation to the subject of the particular legislation.
If classification is germane to the purpose of the law,
concerns all members of the class, and applies equally to
present and future conditions, the classification does not
violate the equal protection guarantee.26
The validity of Section 6 of R.A. No. 8042 which provides that
employees of recruitment agencies may be criminally liable for illegal
recruitment has been upheld in People v. Chowdury:27
As stated in the first sentence of Section 6 of RA 8042, the
persons who may be held liable for illegal recruitment are the
principals, accomplices and accessories. An employee of a
company or corporation engaged in illegal recruitment may be
held liable as principal, together with his employer, if it is
shown that he actively and consciously participated in illegal
recruitment. It has been held that the existence of the
corporate entity does not shield from prosecution the
corporate agent who knowingly and intentionally causes the
corporation to commit a crime. The corporation obviously
acts, and can act, only by and through its human agents, and
it is their conduct which the law must deter. The employee or
agent of a corporation engaged in unlawful business naturally
aids and abets in the carrying on of such business and will be
prosecuted as principal if, with knowledge of the business, its
purpose and effect, he consciously contributes his efforts to
its conduct and promotion, however slight his contribution
may be. …28
By its rulings, the Court thereby affirmed the validity of the assailed
penal and procedural provisions of Rep. Act No. 8042, including the
imposable penalties therefor. Until the Court, by final judgment,
declares that the said provisions are unconstitutional, the enforcement
of the said provisions cannot be enjoined.
The RTC Committed Grave Abuse of Its Discretion Amounting to
Excess or Lack of Jurisdiction in Issuing the Assailed Order and the
Writ of Preliminary Injunction
The matter of whether to issue a writ of preliminary injunction or not is
addressed to the sound discretion of the trial court. However, if the
court commits grave abuse of its discretion in issuing the said writ
amounting to excess or lack of jurisdiction, the same may be nullified
via a writ of certiorari and prohibition.
In Social Security Commission v. Judge Bayona,29 we ruled that a law is
presumed constitutional until otherwise declared by judicial
interpretation. The suspension of the operation of the law is a matter of
extreme delicacy because it is an interference with the official acts not
only of the duly elected representatives of the people but also of the
highest magistrate of the land.
In Younger v. Harris, Jr., 30 the Supreme Court of the United States
emphasized, thus:
Federal injunctions against state criminal statutes, either in
their entirety or with respect to their separate and distinct
prohibitions, are not to be granted as a matter of course, even
if such statutes are unconstitutional. No citizen or member of
the community is immune from prosecution, in good faith, for
his alleged criminal acts. The imminence of such a
prosecution even though alleged to be unauthorized and,
hence, unlawful is not alone ground for relief in equity which
exerts its extraordinary powers only to prevent irreparable
injury to the plaintiff who seeks its aid. 752 Beal v. Missouri
Pacific Railroad Corp., 312 U.S. 45, 49, 61 S.Ct. 418, 420, 85
L.Ed. 577.
And similarly, in Douglas, supra, we made clear, after reaffirming this
rule, that:
"It does not appear from the record that petitioners have been
threatened with any injury other than that incidental to every
criminal proceeding brought lawfully and in good faith …" 319
U.S., at 164, 63 S.Ct., at 881.31
The possible unconstitutionality of a statute, on its face, does not of
itself justify an injunction against good faith attempts to enforce it,
unless there is a showing of bad faith, harassment, or any other
unusual circumstance that would call for equitable relief. 32 The "on its
face" invalidation of statutes has been described as "manifestly strong
medicine," to be employed "sparingly and only as a last resort," and is
generally disfavored.33
To be entitled to a preliminary injunction to enjoin the enforcement of a
law assailed to be unconstitutional, the party must establish that it will
suffer irreparable harm in the absence of injunctive relief and must
demonstrate that it is likely to succeed on the merits, or that there are
sufficiently serious questions going to the merits and the balance of
hardships tips decidedly in its favor. 34 The higher standard reflects
judicial deference toward "legislation or regulations developed through
presumptively reasoned democratic processes." Moreover, an
injunction will alter, rather than maintain, the status quo, or will provide
the movant with substantially all the relief sought and that relief cannot
be undone even if the defendant prevails at a trial on the merits. 35
Considering that injunction is an exercise of equitable relief and
authority, in assessing whether to issue a preliminary injunction, the
courts must sensitively assess all the equities of the situation, including
the public interest.36 In litigations between governmental and private
parties, courts go much further both to give and withhold relief in
furtherance of public interest than they are accustomed to go when only
private interests are involved. 37 Before the plaintiff may be entitled to
injunction against future enforcement, he is burdened to show some
substantial hardship.38
The fear or chilling-effect of the assailed penal provisions of the law on
the members of the respondent does not by itself justify prohibiting the
State from enforcing them against those whom the State believes in
good faith to be punishable under the laws:
… Just as the incidental "chilling effect" of such statutes does
not automatically render them unconstitutional, so the chilling
effect that admittedly can result from the very existence of
certain laws on the statute books does not in itself justify
prohibiting the State from carrying out the important and
necessary task of enforcing these laws against socially
harmful conduct that the State believes in good faith to be
punishable under its laws and the Constitution.39
It must be borne in mind that subject to constitutional limitations,
Congress is empowered to define what acts or omissions shall
constitute a crime and to prescribe punishments therefor. 40 The power
is inherent in Congress and is part of the sovereign power of the State
to maintain peace and order. Whatever views may be entertained
regarding the severity of punishment, whether one believes in its
efficiency or its futility, these are peculiarly questions of legislative
policy.41 The comparative gravity of crimes and whether their
consequences are more or less injurious are matters for the State and
Congress itself to determine.42 Specification of penalties involves
questions of legislative policy.43
Due process prohibits criminal stability from shifting the burden of proof
to the accused, punishing wholly passive conduct, defining crimes in
vague or overbroad language and failing to grant fair warning of illegal
conduct.44 Class legislation is such legislation which denies rights to
one which are accorded to others, or inflicts upon one individual a more
severe penalty than is imposed upon another in like case offending. 45
Bills of attainder are legislative acts which inflict punishment on
individuals or members of a particular group without a judicial trial.
Essential to a bill of attainder are a specification of certain individuals or
a group of individuals, the imposition of a punishment, penal or
otherwise, and the lack of judicial trial.46
Penalizing unlicensed and licensed recruitment agencies and their
officers and employees and their relatives employed in government
agencies charged with the enforcement of the law for illegal recruitment
and imposing life imprisonment for those who commit large scale illegal
recruitment is not offensive to the Constitution. The accused may be
convicted of illegal recruitment and large scale illegal recruitment only
if, after trial, the prosecution is able to prove all the elements of the
crime charged.47
The possibility that the officers and employees of the recruitment
agencies, which are members of the respondent, and their relatives
who are employed in the government agencies charged in the
enforcement of the law, would be indicted for illegal recruitment and, if
convicted sentenced to life imprisonment for large scale illegal
recruitment, absent proof of irreparable injury, is not sufficient on which
to base the issuance of a writ of preliminary injunction to suspend the
enforcement of the penal provisions of Rep. Act No. 8042 and avert any
indictments under the law.48 The normal course of criminal prosecutions
cannot be blocked on the basis of allegations which amount to
speculations about the future.49
There is no allegation in the amended petition or evidence adduced by
the respondent that the officers and/or employees of its members had
been threatened with any indictments for violations of the penal
provisions of Rep. Act No. 8042. Neither is there any allegation therein
that any of its members and/or their officers and employees committed
any of the acts enumerated in Section 6(a) to (m) of the law for which
they could be indicted. Neither did the respondent adduce any evidence
in the RTC that any or all of its members or a great number of other
duly licensed and registered recruitment agencies had to stop their
business operations because of fear of indictments under Sections 6
and 7 of Rep. Act No. 8042. The respondent merely speculated and
surmised that licensed and registered recruitment agencies would close
shop and stop business operations because of the assailed penal
provisions of the law. A writ of preliminary injunction to enjoin the
enforcement of penal laws cannot be based on such conjectures or
speculations. The Court cannot take judicial notice that the processing
of deployment papers of overseas workers have come to a virtual
standstill at the POEA because of the assailed provisions of Rep. Act
No. 8042. The respondent must adduce evidence to prove its
allegation, and the petitioners accorded a chance to adduce
controverting evidence.
The respondent even failed to adduce any evidence to prove
irreparable injury because of the enforcement of Section 10(1)(2) of
Rep. Act No. 8042. Its fear or apprehension that, because of time
constraints, its members would have to defend foreign employees in
cases before the Labor Arbiter is based on speculations. Even if true,
such inconvenience or difficulty is hardly irreparable injury.
The trial court even ignored the public interest involved in suspending
the enforcement of Rep. Act No. 8042 vis-à-vis the eleven licensed and
registered recruitment agencies represented by the respondent. In
People v. Gamboa,50 we emphasized the primary aim of Rep. Act No.
8042:
Preliminarily, the proliferation of illegal job recruiters and
syndicates preying on innocent people anxious to obtain
employment abroad is one of the primary considerations that
led to the enactment of The Migrant Workers and Overseas
Filipinos Act of 1995. Aimed at affording greater protection to
overseas Filipino workers, it is a significant improvement on
existing laws in the recruitment and placement of workers for
overseas employment. Otherwise known as the Magna Carta
of OFWs, it broadened the concept of illegal recruitment
under the Labor Code and provided stiffer penalties thereto,
especially those that constitute economic sabotage, i.e.,
Illegal Recruitment in Large Scale and Illegal Recruitment
Committed by a Syndicate.51
By issuing the writ of preliminary injunction against the petitioners sans
any evidence, the trial court frustrated, albeit temporarily, the
prosecution of illegal recruiters and allowed them to continue victimizing
hapless and innocent people desiring to obtain employment abroad as
overseas workers, and blocked the attainment of the salutary policies 52
embedded in Rep. Act No. 8042. It bears stressing that overseas
workers, land-based and sea-based, had been remitting to the
Philippines billions of dollars which over the years had propped the
economy.
In issuing the writ of preliminary injunction, the trial court considered
paramount the interests of the eleven licensed and registered
recruitment agencies represented by the respondent, and capriciously
overturned the presumption of the constitutionality of the assailed
provisions on the barefaced claim of the respondent that the assailed
provisions of Rep. Act No. 8042 are unconstitutional. The trial court
committed a grave abuse of its discretion amounting to excess or lack
of jurisdiction in issuing the assailed order and writ of preliminary
injunction. It is for this reason that the Court issued a temporary
restraining order enjoining the enforcement of the writ of preliminary
injunction issued by the trial court.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The
assailed decision of the appellate court is REVERSED AND SET
ASIDE. The Order of the Regional Trial Court dated August 21, 1995 in
Civil Case No. Q-95-24401 and the Writ of Preliminary Injunction issued
by it in the said case on August 24, 1995 are NULLIFIED. No costs.
SO ORDERED.
G.R. No. 113375 May 5, 1994
KILOSBAYAN, INCORPORATED, JOVITO R. SALONGA, CIRILO A.
RIGOS, ERME CAMBA, EMILIO C. CAPULONG, JR., JOSE T.
APOLO, EPHRAIM TENDERO, FERNANDO SANTIAGO, JOSE
ABCEDE, CHRISTINE TAN, FELIPE L. GOZON, RAFAEL G.
FERNANDO, RAOUL V. VICTORINO, JOSE CUNANAN, QUINTIN S.
DOROMAL, SEN. FREDDIE WEBB, SEN. WIGBERTO TAÑADA, and
REP. JOKER P. ARROYO, petitioners,
vs.
TEOFISTO GUINGONA, JR., in his capacity as Executive
Secretary, Office of the President; RENATO CORONA, in his
capacity as Assistant Executive Secretary and Chairman of the
Presidential review Committee on the Lotto, Office of the
President; PHILIPPINE CHARITY SWEEPSTAKES OFFICE; and
PHILIPPINE GAMING MANAGEMENT CORPORATION, respondents.
Jovito R. Salonga, Fernando Santiago, Emilio C. Capulong, Jr. and
Felipe L. Gozon for petitioners.
Renato L. Cayetano and Eleazar B. Reyes for PGMC.
Gamaliel G. Bongco, Oscar Karaan and Jedideoh Sincero for
intervenors.
DAVIDE, JR., J.:
This is a special civil action for prohibition and injunction, with a prayer
for a temporary restraining order and preliminary injunction, which
seeks to prohibit and restrain the implementation of the "Contract of
Lease" executed by the Philippine Charity Sweepstakes Office (PCSO)
and the Philippine Gaming Management Corporation (PGMC) in
connection with the on- line lottery system, also known as "lotto."
Petitioner Kilosbayan, Incorporated (KILOSBAYAN) avers that it is a
non-stock domestic corporation composed of civic-spirited citizens,
pastors, priests, nuns, and lay leaders who are committed to the cause
of truth, justice, and national renewal. The rest of the petitioners, except
Senators Freddie Webb and Wigberto Tañada and Representative
Joker P. Arroyo, are suing in their capacities as members of the Board
of Trustees of KILOSBAYAN and as taxpayers and concerned citizens.
Senators Webb and Tañada and Representative Arroyo are suing in
their capacities as members of Congress and as taxpayers and
concerned citizens of the Philippines.
The pleadings of the parties disclose the factual antecedents which
triggered off the filing of this petition.
Pursuant to Section 1 of the charter of the PCSO (R.A. No. 1169, as
amended by B.P. Blg. 42) which grants it the authority to hold and
conduct "charity sweepstakes races, lotteries and other similar
activities," the PCSO decided to establish an on- line lottery system for
the purpose of increasing its revenue base and diversifying its sources
of funds. Sometime before March 1993, after learning that the PCSO
was interested in operating an on-line lottery system, the Berjaya Group
Berhad, "a multinational company and one of the ten largest public
companies in Malaysia," long "engaged in, among others, successful
lottery operations in Asia, running both Lotto and Digit games, thru its
subsidiary, Sports Toto Malaysia," with its "affiliate, the International
Totalizator Systems, Inc., . . . an American public company engaged in
the international sale or provision of computer systems, softwares,
terminals, training and other technical services to the gaming industry,"
"became interested to offer its services and resources to PCSO." As an
initial step, Berjaya Group Berhad (through its individual nominees)
organized with some Filipino investors in March 1993 a Philippine
corporation known as the Philippine Gaming Management Corporation
(PGMC), which "was intended to be the medium through which the
technical and management services required for the project would be
offered and delivered to PCSO." 1
Before August 1993, the PCSO formally issued a Request for Proposal
(RFP) for the Lease Contract of an on-line lottery system for the PCSO.
2 Relevant provisions of the RFP are the following:
1. EXECUTIVE SUMMARY
xxx xxx xxx
1.2. PCSO is seeking a suitable contractor which
shall build, at its own expense, all the facilities
('Facilities') needed to operate and maintain a
nationwide on-line lottery system. PCSO shall lease
the Facilities for a fixed percentage ofquarterly gross
receipts. All receipts from ticket sales shall be turned
over directly to PCSO. All capital, operating
expenses and expansion expenses and risks shall
be for the exclusive account of the Lessor.
xxx xxx xxx
1.4. The lease shall be for a period not exceeding
fifteen (15) years.
1.5. The Lessor is expected to submit a
comprehensive nationwide lottery development plan
("Development Plan") which will include the game,
the marketing of the games, and the logistics to
introduce the games to all the cities and
municipalities of the country within five (5) years.
xxx xxx xxx
1.7. The Lessor shall be selected based on its
technical expertise, hardware and software
capability, maintenance support, and financial
resources. The Development Plan shall have a
substantial bearing on the choice of the Lessor. The
Lessor shall be a domestic corporation, with at least
sixty percent (60%) of its shares owned by Filipino
shareholders.
xxx xxx xxx
The Office of the President, the National Disaster
Control Coordinating Council, the Philippine National
Police, and the National Bureau of Investigation
shall be authorized to use the nationwide
telecommunications system of the Facilities Free of
Charge.
1.8. Upon expiration of the lease, the Facilities shall
be owned by PCSO without any additional
consideration. 3
xxx xxx xxx
2.2. OBJECTIVES
The objectives of PCSO in leasing the Facilities from
a private entity are as follows:
xxx xxx xxx
2.2.2. Enable PCSO to operate a nationwide on-line
Lottery system at no expense or risk to the
government.
xxx xxx xxx
2.4. DUTIES AND RESPONSIBILITIES OF THE
LESSOR
xxx xxx xxx
2.4.2. THE LESSOR
The Proponent is expected to furnish and maintain
the Facilities, including the personnel needed to
operate the computers, the communications network
and sales offices under a build-lease basis. The
printing of tickets shall be undertaken under the
supervision and control of PCSO. The Facilities shall
enable PCSO to computerize the entire gaming
system.
The Proponent is expected to formulate and design
consumer-oriented Master Games Plan suited to the
marketplace, especially geared to Filipino gaming
habits and preferences. In addition, the Master
Games Plan is expected to include a Product Plan
for each game and explain how each will be
introduced into the market. This will be an integral
part of the Development Plan which PCSO will
require from the Proponent.
xxx xxx xxx
The Proponent is expected to provide upgrades to
modernize the entire gaming system over the life
ofthe lease contract.
The Proponent is expected to provide technology
transfer to PCSO technical personnel. 4
7. GENERAL GUIDELINES FOR PROPONENTS
xxx xxx xxx
Finally, the Proponent must be able to stand the
acid test of proving that it is an entity able to take on
the role of responsible maintainer of the on-line
lottery system, and able to achieve PSCO's goal of
formalizing an on-line lottery system to achieve its
mandated objective. 5
xxx xxx xxx
16. DEFINITION OF TERMS
Facilities: All capital equipment, computers,
terminals, software, nationwide telecommunication
network, ticket sales offices, furnishings, and
fixtures; printing costs; cost of salaries and wages;
advertising and promotion expenses; maintenance
costs; expansion and replacement costs; security
and insurance, and all other related expenses
needed to operate nationwide on-line lottery
system.6
Considering the above citizenship requirement, the PGMC claims that
the Berjaya Group "undertook to reduce its equity stakes in PGMC to
40%," by selling 35% out of the original 75% foreign stockholdings to
local investors.
On 15 August 1993, PGMC submitted its bid to the PCSO.7
The bids were evaluated by the Special Pre-Qualification Bids and
Awards Committee (SPBAC) for the on-line lottery and its Bid Report
was thereafter submitted to the Office of the President. 8 The
submission was preceded by complaints by the Committee's
Chairperson, Dr. Mita Pardo de Tavera. 9
On 21 October 1993, the Office of the President announced that it had
given the respondent PGMC the go-signal to operate the country's on-
line lottery system and that the corresponding implementing contract
would be submitted not later than 8 November 1993 "for final clearance
and approval by the Chief Executive." 10 This announcement was
published in the Manila Standard, Philippine Daily Inquirer, and the
Manila Times on 29 October 1993. 11
On 4 November 1993, KILOSBAYAN sent an open letter to Presidential
Fidel V. Ramos strongly opposing the setting up to the on-line lottery
system on the basis of serious moral and ethical considerations. 12
At the meeting of the Committee on Games and Amusements of the
Senate on 12 November 1993, KILOSBAYAN reiterated its vigorous
opposition to the on-line lottery on account of its immorality and
illegality. 13
On 19 November 1993, the media reported that despite the opposition,
"Malacañang will push through with the operation of an on-line lottery
system nationwide" and that it is actually the respondent PCSO which
will operate the lottery while the winning corporate bidders are merely
"lessors." 14
On 1 December 1993, KILOSBAYAN requested copies of all
documents pertaining to the lottery award from Executive Secretary
Teofisto Guingona, Jr. In his answer of 17 December 1993, the
Executive Secretary informed KILOSBAYAN that the requested
documents would be duly transmitted before the end of the month. 15.
However, on that same date, an agreement denominated as "Contract
of Lease" was finally executed by respondent PCSO and respondent
PGMC. 16 The President, per the press statement issued by the Office
of the President, approved it on 20 December 1993.17
In view of their materiality and relevance, we quote the following salient
provisions of the Contract of Lease:
1. DEFINITIONS
The following words and terms shall have the
following respective meanings:
1.1 Rental Fee — Amount to be paid by PCSO to
the LESSOR as compensation for the fulfillment of
the obligations of the LESSOR under this Contract,
including, but not limited to the lease of the
Facilities.
xxx xxx xxx
1.3 Facilities — All capital equipment, computers,
terminals, software (including source codes for the
On-Line Lottery application software for the
terminals, telecommunications and central systems),
technology, intellectual property rights,
telecommunications network, and furnishings and
fixtures.
1.4 Maintenance and Other Costs — All costs and
expenses relating to printing, manpower, salaries
and wages, advertising and promotion,
maintenance, expansion and replacement, security
and insurance, and all other related expenses
needed to operate an On-Line Lottery System,
which shall be for the account of the LESSOR. All
expenses relating to the setting-up, operation and
maintenance of ticket sales offices of dealers and
retailers shall be borne by PCSO's dealers and
retailers.
1.5 Development Plan — The detailed plan of all
games, the marketing thereof, number of players,
value of winnings and the logistics required to
introduce the games, including the Master Games
Plan as approved by PCSO, attached hereto as
Annex "A", modified as necessary by the provisions
of this Contract.
xxx xxx xxx
1.8 Escrow Deposit — The proposal deposit in the
sum of Three Hundred Million Pesos
(P300,000,000.00) submitted by the LESSOR to
PCSO pursuant to the requirements of the Request
for Proposals.
2. SUBJECT MATTER OF THE LEASE
The LESSOR shall build, furnish and maintain at its
own expense and risk the Facilities for the On-Line
Lottery System of PCSO in the Territory on an
exclusive basis. The LESSOR shall bear all
Maintenance and Other Costs as defined herein.
xxx xxx xxx
3. RENTAL FEE
For and in consideration of the performance by the
LESSOR of its obligations herein, PCSO shall pay
LESSOR a fixed Rental Fee equal to four point nine
percent (4.9%) of gross receipts from ticket sales,
payable net of taxes required by law to be withheld,
on a semi-monthly basis. Goodwill, franchise and
similar fees shall belong to PCSO.
4. LEASE PERIOD
The period of the lease shall commence ninety (90)
days from the date of effectivity of this Contract and
shall run for a period of eight (8) years thereafter,
unless sooner terminated in accordance with this
Contract.
5. RIGHTS AND OBLIGATIONS OF PCSO AS
OPERATOR OF THE ON-LINE LOTTERY SYSTEM
PCSO shall be the sole and individual operator of
the On-Line Lottery System. Consequently:
5.1 PCSO shall have sole responsibility to decide
whether to implement, fully or partially, the Master
Games Plan of the LESSOR. PCSO shall have the
sole responsibility to determine the time for
introducing new games to the market. The Master
Games Plan included in Annex "A" hereof is hereby
approved by PCSO.
5.2 PCSO shall have control over revenues and
receipts of whatever nature from the On-Line Lottery
System. After paying the Rental Fee to the
LESSOR, PCSO shall have exclusive responsibility
to determine the Revenue Allocation Plan; Provided,
that the same shall be consistent with the
requirement of R.A. No. 1169, as amended, which
fixes a prize fund of fifty five percent (55%) on the
average.
5.3 PCSO shall have exclusive control over the
printing of tickets, including but not limited to the
design, text, and contents thereof.
5.4 PCSO shall have sole responsibility over the
appointment of dealers or retailers throughout the
country. PCSO shall appoint the dealers and
retailers in a timely manner with due regard to the
implementation timetable of the On-Line Lottery
System. Nothing herein shall preclude the LESSOR
from recommending dealers or retailers for
appointment by PCSO, which shall act on said
recommendation within forty-eight (48) hours.
5.5 PCSO shall designate the necessary personnel
to monitor and audit the daily performance of the
On-Line Lottery System. For this purpose, PCSO
designees shall be given, free of charge, suitable
and adequate space, furniture and fixtures, in all
offices of the LESSOR, including but not limited to
its headquarters, alternate site, regional and area
offices.
5.6 PCSO shall have the responsibility to resolve,
and exclusive jurisdiction over, all matters involving
the operation of the On-Line Lottery System not
otherwise provided in this Contract.
5.7 PCSO shall promulgate procedural and
coordinating rules governing all activities relating to
the On-Line Lottery System.
5.8 PCSO will be responsible for the payment of
prize monies, commissions to agents and dealers,
and taxes and levies (if any) chargeable to the
operator of the On-Line Lottery System. The
LESSOR will bear all other Maintenance and Other
Costs, except as provided in Section 1.4.
5.9 PCSO shall assist the LESSOR in the following:
5.9.1 Work permits for the
LESSOR's staff;
5.9.2 Approvals for importation of
the Facilities;
5.9.3 Approvals and consents for
the On-Line Lottery System; and
5.9.4 Business and premises
licenses for all offices of the
LESSOR and licenses for the
telecommunications network.
5.10 In the event that PCSO shall pre-terminate this
Contract or suspend the operation of the On-Line
Lottery System, in breach of this Contract and
through no fault of the LESSOR, PCSO shall
promptly, and in any event not later than sixty (60)
days, reimburse the LESSOR the amount of its total
investment cost associated with the On-Line Lottery
System, including but not limited to the cost of the
Facilities, and further compensate the LESSOR for
loss of expected net profit after tax, computed over
the unexpired term of the lease.
6. DUTIES AND RESPONSIBILITIES OF THE
LESSOR
The LESSOR is one of not more than three (3)
lessors of similar facilities for the nationwide On-Line
Lottery System of PCSO. It is understood that the
rights of the LESSOR are primarily those of a lessor
of the Facilities, and consequently, all rights
involving the business aspects of the use of the
Facilities are within the jurisdiction of PCSO. During
the term of the lease, the LESSOR shall.
6.1 Maintain and preserve its corporate existence,
rights and privileges, and conduct its business in an
orderly, efficient, and customary manner.
6.2 Maintain insurance coverage with insurers
acceptable to PCSO on all Facilities.
6.3 Comply with all laws, statues, rules and
regulations, orders and directives, obligations and
duties by which it is legally bound.
6.4 Duly pay and discharge all taxes, assessments
and government charges now and hereafter
imposed of whatever nature that may be legally
levied upon it.
6.5 Keep all the Facilities in fail safe condition and, if
necessary, upgrade, replace and improve the
Facilities from time to time as new technology
develops, in order to make the On-Line Lottery
System more cost-effective and/or competitive, and
as may be required by PCSO shall not impose such
requirements unreasonably nor arbitrarily.
6.6 Provide PCSO with management terminals
which will allow real-time monitoring of the On-Line
Lottery System.
6.7 Upon effectivity of this Contract, commence the
training of PCSO and other local personnel and the
transfer of technology and expertise, such that at the
end of the term of this Contract, PCSO will be able
to effectively take-over the Facilities and efficiently
operate the On-Line Lottery System.
6.8 Undertake a positive advertising and promotions
campaign for both institutional and product lines
without engaging in negative advertising against
other lessors.
6.9 Bear all expenses and risks relating to the
Facilities including, but not limited to, Maintenance
and Other Costs and:
xxx xxx xxx
6.10 Bear all risks if the revenues from ticket sales,
on an annualized basis, are insufficient to pay the
entire prize money.
6.11 Be, and is hereby, authorized to collect and
retain for its own account, a security deposit from
dealers and retailers, in an amount determined with
the approval of PCSO, in respect of equipment
supplied by the LESSOR. PCSO's approval shall not
be unreasonably withheld.
xxx xxx xxx
6.12 Comply with procedural and coordinating rules
issued by PCSO.
7. REPRESENTATIONS AND WARRANTIES
The LESSOR represents and warrants that:
7.1 The LESSOR is corporation duly organized and
existing under the laws of the Republic of the
Philippines, at least sixty percent (60%) of the
outstanding capital stock of which is owned by
Filipino shareholders. The minimum required Filipino
equity participation shall not be impaired through
voluntary or involuntary transfer, disposition, or sale
of shares of stock by the present stockholders.
7.2 The LESSOR and its Affiliates have the full
corporate and legal power and authority to own and
operate their properties and to carry on their
business in the place where such properties are now
or may be conducted. . . .
7.3 The LESSOR has or has access to all the
financing and funding requirements to promptly and
effectively carry out the terms of this Contract. . . .
7.4 The LESSOR has or has access to all the
managerial and technical expertise to promptly and
effectively carry out the terms of this Contract. . . .
xxx xxx xxx
10. TELECOMMUNICATIONS NETWORK
The LESSOR shall establish a telecommunications
network that will connect all municipalities and cities
in the Territory in accordance with, at the LESSOR's
option, either of the LESSOR's proposals (or a
combinations of both such proposals) attached
hereto as Annex "B," and under the following PCSO
schedule:
xxx xxx xxx
PCSO may, at its option, require the LESSOR to
establish the telecommunications network in
accordance with the above Timetable in provinces
where the LESSOR has not yet installed terminals.
Provided, that such provinces have existing nodes.
Once a municipality or city is serviced by land lines
of a licensed public telephone company, and such
lines are connected to Metro Manila, then the
obligation of the LESSOR to connect such
municipality or city through a telecommunications
network shall cease with respect to such
municipality or city. The voice facility will cover the
four offices of the Office of the President, National
Disaster Control Coordinating Council, Philippine
National Police and the National Bureau of
Investigation, and each city and municipality in the
Territory except Metro Manila, and those cities and
municipalities which have easy telephone access
from these four offices. Voice calls from the four
offices shall be transmitted via radio or VSAT to the
remote municipalities which will be connected to this
voice facility through wired network or by radio. The
facility shall be designed to handle four private
conversations at any one time.
xxx xxx xxx
13. STOCK DISPERSAL PLAN
Within two (2) years from the effectivity of this
Contract, the LESSOR shall cause itself to be listed
in the local stock exchange and offer at least twenty
five percent (25%) of its equity to the public.
14. NON-COMPETITION
The LESSOR shall not, directly or indirectly,
undertake any activity or business in competition
with or adverse to the On-Line Lottery System of
PCSO unless it obtains the latter's prior written
consent thereto.
15. HOLD HARMLESS CLAUSE
15.1 The LESSOR shall at all times protect and
defend, at its cost and expense, PCSO from and
against any and all liabilities and claims for damages
and/or suits for or by reason of any deaths of, or any
injury or injuries to any person or persons, or
damages to property of any kind whatsoever,
caused by the LESSOR, its subcontractors, its
authorized agents or employees, from any cause or
causes whatsoever.
15.2 The LESSOR hereby covenants and agrees to
indemnify and hold PCSO harmless from all
liabilities, charges, expenses (including reasonable
counsel fees) and costs on account of or by reason
of any such death or deaths, injury or injuries,
liabilities, claims, suits or losses caused by the
LESSOR's fault or negligence.
15.3 The LESSOR shall at all times protect and
defend, at its own cost and expense, its title to the
facilities and PCSO's interest therein from and
against any and all claims for the duration of the
Contract until transfer to PCSO of ownership of the
serviceable Facilities.
16. SECURITY
16.1 To ensure faithful compliance by the LESSOR
with the terms of the Contract, the LESSOR shall
secure a Performance Bond from a reputable
insurance company or companies acceptable to
PCSO.
16.2 The Performance Bond shall be in the initial
amount of Three Hundred Million Pesos
(P300,000,000.00), to its U.S. dollar equivalent, and
shall be renewed to cover the duration of the
Contract. However, the Performance Bond shall be
 reduced proportionately to the percentage of
unencumbered terminals installed; Provided, that
the Performance Bond shall in no case be less than
One Hundred Fifty Million Pesos (P150,000,000.00).
16.3 The LESSOR may at its option maintain its
Escrow Deposit as the Performance Bond. . . .
17. PENALTIES
17.1 Except as may be provided in Section 17.2,
should the LESSOR fail to take remedial measures
within seven (7) days, and rectify the breach within
thirty (30) days, from written notice by PCSO of any
wilfull or grossly negligent violation of the material
terms and conditions of this Contract, all
unencumbered Facilities shall automatically become
the property of PCSO without consideration and
without need for further notice or demand by PCSO.
The Performance Bond shall likewise be forfeited in
favor of PCSO.
17.2 Should the LESSOR fail to comply with the
terms of the Timetables provided in Section 9 and
10, it shall be subject to an initial Penalty of Twenty
Thousand Pesos (P20,000.00), per city or
municipality per every month of delay; Provided, that
the Penalty shall increase, every ninety (90) days,
by the amount of Twenty Thousand Pesos
(P20,000.00) per city or municipality per month,
whilst shall failure to comply persists. The penalty
shall be deducted by PCSO from the rental fee.
xxx xxx xxx
20. OWNERSHIP OF THE FACILITIES
After expiration of the term of the lease as provided
in Section 4, the Facilities directly required for the
On-Line Lottery System mentioned in Section 1.3
shall automatically belong in full ownership to PCSO
without any further consideration other than the
Rental Fees already paid during the effectivity of the
lease.
21. TERMINATION OF THE LEASE
PCSO may terminate this Contract for any breach of
the material provisions of this Contract, including the
following:
21.1 The LESSOR is insolvent or bankrupt or unable
to pay its debts, stops or suspends or threatens to
stop or suspend payment of all or a material part of
its debts, or proposes or makes a general
assignment or an arrangement or compositions with
or for the benefit of its creditors; or
21.2 An order is made or an effective resolution
passed for the winding up or dissolution of the
LESSOR or when it ceases or threatens to cease to
carry on all or a material part of its operations or
business; or
21.3 Any material statement, representation or
warranty made or furnished by the LESSOR proved
to be materially false or misleading;
said termination to take effect
upon receipt of written notice of
termination by the LESSOR and
failure to take remedial action
within seven (7) days and cure or
remedy the same within thirty
(30) days from notice.
Any suspension, cancellation or
termination of this Contract shall
not relieve the LESSOR of any
liability that may have already
accrued hereunder.
x x x           x x x          x x x
Considering the denial by the Office of the President of its protest and
the statement of Assistant Executive Secretary Renato Corona that
"only a court injunction can stop Malacañang," and the imminent
implementation of the Contract of Lease in February 1994,
KILOSBAYAN, with its co-petitioners, filed on 28 January 1994 this
petition.
In support of the petition, the petitioners claim that:
. . . X X THE OFFICE OF THE
PRESIDENT, ACTING
THROUGH RESPONDENTS
EXECUTIVE SECRETARY
AND/OR ASSISTANT
EXECUTIVE SECRETARY FOR
LEGAL AFFAIRS, AND THE
PCSO GRAVELY ABUSE[D]
THEIR DISCRETION AND/OR
FUNCTIONS TANTAMOUNT TO
LACK OF JURISDICTION
AND/OR AUTHORITY IN
RESPECTIVELY: (A)
APPROVING THE AWARD OF
THE CONTRACT TO, AND (B)
ENTERING INTO THE SO-
CALLED "CONTRACT OF
LEASE" WITH, RESPONDENT
PGMC FOR THE
INSTALLATION,
ESTABLISHMENT AND
OPERATION OF THE ON-LINE
LOTTERY AND
TELECOMMUNICATION
SYSTEMS REQUIRED AND/OR
AUTHORIZED UNDER THE
SAID CONTRACT,
CONSIDERING THAT:
a) Under Section 1 of the Charter of the PCSO, the
PCSO is prohibited from holding and conducting
lotteries "in collaboration, association or joint
venture with any person, association, company or
entity";
b) Under Act No. 3846 and established
jurisprudence, a Congressional franchise is required
before any person may be allowed to establish and
operate said telecommunications system;
c) Under Section 11, Article XII of the Constitution, a
less than 60% Filipino-owned and/or controlled
corporation, like the PGMC, is disqualified from
operating a public service, like the said
telecommunications system; and
d) Respondent PGMC is not authorized by its
charter and under the Foreign Investment Act (R.A.
No. 7042) to install, establish and operate the on-
line lotto and telecommunications systems.18
Petitioners submit that the PCSO cannot validly enter into the assailed
Contract of Lease with the PGMC because it is an arrangement
wherein the PCSO would hold and conduct the on-line lottery system in
"collaboration" or "association" with the PGMC, in violation of Section
1(B) of R.A. No. 1169, as amended by B.P. Blg. 42, which prohibits the
PCSO from holding and conducting charity sweepstakes races,
lotteries, and other similar activities "in collaboration, association or joint
venture with any person, association, company or entity, foreign or
domestic." Even granting arguendo that a lease of facilities is not within
the contemplation of "collaboration" or "association," an analysis,
however, of the Contract of Lease clearly shows that there is a
"collaboration, association, or joint venture between respondents PCSO
and PGMC in the holding of the On-Line Lottery System," and that
there are terms and conditions of the Contract "showing that
respondent PGMC is the actual lotto operator and not respondent
PCSO."19
The petitioners also point out that paragraph 10 of the Contract of
Lease requires or authorizes PGMC to establish a telecommunications
network that will connect all the municipalities and cities in the territory.
However, PGMC cannot do that because it has no franchise from
Congress to construct, install, establish, or operate the network
pursuant to Section 1 of Act No. 3846, as amended. Moreover, PGMC
is a 75% foreign-owned or controlled corporation and cannot, therefore,
be granted a franchise for that purpose because of Section 11, Article
XII of the 1987 Constitution. Furthermore, since "the subscribed foreign
capital" of the PGMC "comes to about 75%, as shown by paragraph
EIGHT of its Articles of Incorporation," it cannot lawfully enter into the
contract in question because all forms of gambling — and lottery is one
of them — are included in the so-called foreign investments negative
list under the Foreign Investments Act (R.A. No. 7042) where only up to
40% foreign capital is allowed. 20
Finally, the petitioners insist that the Articles of Incorporation of PGMC
do not authorize it to establish and operate an on-line lottery and
telecommunications systems.21
Accordingly, the petitioners pray that we issue a temporary restraining
order and a writ of preliminary injunction commanding the respondents
or any person acting in their places or upon their instructions to cease
and desist from implementing the challenged Contract of Lease and,
after hearing the merits of the petition, that we render judgment
declaring the Contract of Lease void and without effect and making the
injunction permanent. 22
We required the respondents to comment on the petition.
In its Comment filed on 1 March 1994, private respondent PGMC
asserts that "(1) [it] is merely an independent contractor for a piece of
work, (i.e., the building and maintenance of a lottery system to be used
by PCSO in the operation of its lottery franchise); and (2) as such
independent contractor, PGMC is not a co-operator of the lottery
franchise with PCSO, nor is PCSO sharing its franchise, 'in
collaboration, association or joint venture' with PGMC — as such
statutory limitation is viewed from the context, intent, and spirit of
Republic Act 1169, as amended by Batas Pambansa 42." It further
claims that as an independent contractor for a piece of work, it is
neither engaged in "gambling" nor in "public service" relative to the
telecommunications network, which the petitioners even consider as an
"indispensable requirement" of an on-line lottery system. Finally, it
states that the execution and implementation of the contract does not
violate the Constitution and the laws; that the issue on the "morality" of
the lottery franchise granted to the PCSO is political and not judicial or
legal, which should be ventilated in another forum; and that the
"petitioners do not appear to have the legal standing or real interest in
the subject contract and in obtaining the reliefs sought." 23
In their Comment filed by the Office of the Solicitor General, public
respondents Executive Secretary Teofisto Guingona, Jr., Assistant
Executive Secretary Renato Corona, and the PCSO maintain that the
contract of lease in question does not violate Section 1 of R.A. No.
1169, as amended by B.P. Blg. 42, and that the petitioner's
interpretation of the phrase "in collaboration, association or joint
venture" in Section 1 is "much too narrow, strained and utterly devoid of
logic" for it "ignores the reality that PCSO, as a corporate entity, is
vested with the basic and essential prerogative to enter into all kinds of
transactions or contracts as may be necessary for the attainment of its
purposes and objectives." What the PCSO charter "seeks to prohibit is
that arrangement akin to a "joint venture" or partnership where there is
"community of interest in the business, sharing of profits and losses,
and a mutual right of control," a characteristic which does not obtain in
a contract of lease." With respect to the challenged Contract of Lease,
the "role of PGMC is limited to that of a lessor of the facilities" for the
on-line lottery system; in "strict technical and legal sense," said contract
"can be categorized as a contract for a piece of work as defined in
Articles 1467, 1713 and 1644 of the Civil Code."
They further claim that the establishment of the telecommunications
system stipulated in the Contract of Lease does not require a
congressional franchise because PGMC will not operate a public utility;
moreover, PGMC's "establishment of a telecommunications system is
not intended to establish a telecommunications business," and it has
been held that where the facilities are operated "not for business
purposes but for its own use," a legislative franchise is not required
before a certificate of public convenience can be granted. 24 Even
granting arguendo that PGMC is a public utility, pursuant to Albano S.
Reyes, 25 "it can establish a telecommunications system even without
a legislative franchise because not every public utility is required to
secure a legislative franchise before it could establish, maintain, and
operate the service"; and, in any case, "PGMC's establishment of the
telecommunications system stipulated in its contract of lease with
PCSO falls within the exceptions under Section 1 of Act No. 3846
where a legislative franchise is not necessary for the establishment of
radio stations."
They also argue that the contract does not violate the Foreign
Investment Act of 1991; that the Articles of Incorporation of PGMC
authorize it to enter into the Contract of Lease; and that the issues of
"wisdom, morality and propriety of acts of the executive department are
beyond the ambit of judicial review."
Finally, the public respondents allege that the petitioners have no
standing to maintain the instant suit, citing our resolution in Valmonte
vs. Philippine Charity Sweepstakes Office. 26
Several parties filed motions to intervene as petitioners in this case, 27
but only the motion of Senators Alberto Romulo, Arturo Tolentino,
Francisco Tatad, Gloria Macapagal-Arroyo, Vicente Sotto III, John
Osmeña, Ramon Revilla, and Jose Lina 28 was granted, and the
respondents were required to comment on their petition in intervention,
which the public respondents and PGMC did.
In the meantime, the petitioners filed with the Securities and Exchange
Commission on 29 March 1994 a petition against PGMC for the
nullification of the latter's General Information Sheets. That case,
however, has no bearing in this petition.
On 11 April 1994, we heard the parties in oral arguments. Thereafter,
we resolved to consider the matter submitted for resolution and pending
resolution of the major issues in this case, to issue a temporary
restraining order commanding the respondents or any person acting in
their place or upon their instructions to cease and desist from
implementing the challenged Contract of Lease.
In the deliberation on this case on 26 April 1994, we resolved to
consider only these issues: (a) the locus standi of the petitioners, and
(b) the legality and validity of the Contract of Lease in the light of
Section 1 of R.A. No. 1169, as amended by B.P. Blg. 42, which
prohibits the PCSO from holding and conducting lotteries "in
collaboration, association or joint venture with any person, association,
company or entity, whether domestic or foreign." On the first issue,
seven Justices voted to sustain the locus standi of the petitioners, while
six voted not to. On the second issue, the seven Justices were of the
opinion that the Contract of Lease violates the exception to Section
1(B) of R.A. No. 1169, as amended by B.P. Blg. 42, and is, therefore,
invalid and contrary to law. The six Justices stated that they wished to
express no opinion thereon in view of their stand on the first issue. The
Chief Justice took no part because one of the Directors of the PCSO is
his brother-in-law.
This case was then assigned to this ponente for the writing of the
opinion of the Court.
The preliminary issue on the locus standi of the petitioners should,
indeed, be resolved in their favor. A party's standing before this Court is
a procedural technicality which it may, in the exercise of its discretion,
set aside in view of the importance of the issues raised. In the landmark
Emergency Powers Cases, 29 this Court brushed aside this technicality
because "the transcendental importance to the public of these cases
demands that they be settled promptly and definitely, brushing aside, if
we must, technicalities of procedure. (Avelino vs. Cuenco, G.R. No. L-
2821)." Insofar as taxpayers' suits are concerned, this Court had
declared that it "is not devoid of discretion as to whether or not it should
be entertained," 30 or that it "enjoys an open discretion to entertain the
same or not." 31 In De La Llana vs. Alba, 32 this Court declared:
1. The argument as to the lack of standing of
petitioners is easily resolved. As far as Judge de la
Llana is concerned, he certainly falls within the
principle set forth in Justice Laurel's opinion in
People vs. Vera [65 Phil. 56 (1937)]. Thus: "The
unchallenged rule is that the person who impugns
the validity of a statute must have a personal and
substantial interest in the case such that he has
sustained, or will sustain, direct injury as a result of
its enforcement [Ibid, 89]. The other petitioners as
members of the bar and officers of the court cannot
be considered as devoid of "any personal and
substantial interest" on the matter. There is
relevance to this excerpt from a separate opinion in
Aquino, Jr. v. Commission on Elections [L-40004,
January 31, 1975, 62 SCRA 275]: "Then there is the
attack on the standing of petitioners, as vindicating
at most what they consider a public right and not
protecting their rights as individuals. This is to
conjure the specter of the public right dogma as an
inhibition to parties intent on keeping public officials
staying on the path of constitutionalism. As was so
well put by Jaffe; "The protection of private rights is
an essential constituent of public interest and,
conversely, without a well-ordered state there could
be no enforcement of private rights. Private and
public interests are, both in a substantive and
procedural sense, aspects of the totality of the legal
order." Moreover, petitioners have convincingly
shown that in their capacity as taxpayers, their
standing to sue has been amply demonstrated.
There would be a retreat from the liberal approach
followed in Pascual v. Secretary of Public Works,
foreshadowed by the very decision of People v.
Vera where the doctrine was first fully discussed, if
we act differently now. I do not think we are
prepared to take that step. Respondents, however,
would hard back to the American Supreme Court
doctrine in Mellon v. Frothingham, with their claim
that what petitioners possess "is an interest which is
shared in common by other people and is
comparatively so minute and indeterminate as to
afford any basis and assurance that the judicial
process can act on it." That is to speak in the
language of a bygone era, even in the United
States. For as Chief Justice Warren clearly pointed
out in the later case of Flast v. Cohen, the barrier
thus set up if not breached has definitely been
lowered.
In Kapatiran ng mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. vs.
Tan,33 reiterated in Basco vs. Philippine Amusements and Gaming
Corporation,34 this Court stated:
Objections to taxpayers' suits for lack of sufficient
personality standing or interest are, however, in the
main procedural matters. Considering the
importance to the public of the cases at bar, and in
keeping with the Court's duty, under the 1987
Constitution, to determine whether or not the other
branches of government have kept themselves
within the limits of the Constitution and the laws and
that they have not abused the discretion given to
them, this Court has brushed aside technicalities of
procedure and has taken cognizance of these
petitions.
and in Association of Small Landowners in the Philippines, Inc. vs.
Secretary of Agrarian Reform,35 it declared:
 With particular regard to the requirement of proper
party as applied in the cases before us, we hold that
the same is satisfied by the petitioners and
intervenors because each of them has sustained or
is in danger of sustaining an immediate injury as a
result of the acts or measures complained of. [Ex
Parte Levitt, 303 US 633]. And even if, strictly
speaking, they are not covered by the definition, it is
still within the wide discretion of the Court to waive
the requirement and so remove the impediment to
its addressing and resolving the serious
constitutional questions raised.
In the first Emergency Powers Cases, ordinary
citizens and taxpayers were allowed to question the
constitutionality of several executive orders issued
by President Quirino although they were invoking
only an indirect and general interest shared in
common with the public. The Court dismissed the
objective that they were not proper parties and ruled
that the transcendental importance to the public of
these cases demands that they be settled promptly
and definitely, brushing aside, if we must,
technicalities of procedure. We have since then
applied this exception in many other cases.
(Emphasis supplied)
In Daza vs. Singson, 36 this Court once more said:
. . . For another, we have early as in the Emergency
Powers Cases that where serious constitutional
questions are involved, "the transcendental
importance to the public of these cases demands
that they be settled promptly and definitely, brushing
aside, if we must, technicalities of procedure." The
same policy has since then been consistently
followed by the Court, as in Gonzales vs.
Commission on Elections [21 SCRA 774] . . .
The Federal Supreme Court of the United States of America has also
expressed its discretionary power to liberalize the rule on locus standi.
In United States vs. Federal Power Commission and Virginia Rea
Association vs. Federal Power Commission,37 it held:
We hold that petitioners have standing. Differences
of view, however, preclude a single opinion of the
Court as to both petitioners. It would not further
clarification of this complicated specialty of federal
jurisdiction, the solution of whose problems is in any
event more or less determined by the specific
circumstances of individual situations, to set out the
divergent grounds in support of standing in these
cases.
In line with the liberal policy of this Court on locus standi, ordinary
taxpayers, members of Congress, and even association of planters,
and non-profit civic organizations were allowed to initiate and prosecute
actions before this Court to question the constitutionality or validity of
laws, acts, decisions, rulings, or orders of various government agencies
or instrumentalities. Among such cases were those assailing the
constitutionality of (a) R.A. No. 3836 insofar as it allows retirement
gratuity and commutation of vacation and sick leave to Senators and
Representatives and to elective officials of both Houses of Congress;38
(b) Executive Order No. 284, issued by President Corazon C. Aquino
on 25 July 1987, which allowed members of the cabinet, their
undersecretaries, and assistant secretaries to hold other government
offices or positions; 39 (c) the automatic appropriation for debt service
in the General Appropriations Act; 40 (d) R.A. No. 7056 on the holding
of desynchronized elections; 41 (d) R.A. No. 1869 (the charter of the
Philippine Amusement and Gaming Corporation) on the ground that it is
contrary to morals, public policy, and order; 42 and (f) R.A. No. 6975,
establishing the Philippine National
Police. 43
Other cases where we have followed a liberal policy regarding locus
standi include those attacking the validity or legality of (a) an order
allowing the importation of rice in the light of the prohibition imposed by
R.A. No. 3452; 44 (b) P.D. Nos. 991 and 1033 insofar as they proposed
amendments to the Constitution and P.D. No. 1031 insofar as it
directed the COMELEC to supervise, control, hold, and conduct the
referendum-plebiscite on 16 October 1976; 45 (c) the bidding for the
sale of the 3,179 square meters of land at Roppongi, Minato-ku, Tokyo,
Japan; 46 (d) the approval without hearing by the Board of Investments
of the amended application of the Bataan Petrochemical Corporation to
transfer the site of its plant from Bataan to Batangas and the validity of
such transfer and the shift of feedstock from naphtha only to naphtha
and/or liquefied petroleum gas; 47 (e) the decisions, orders, rulings,
and resolutions of the Executive Secretary, Secretary of Finance,
Commissioner of Internal Revenue, Commissioner of Customs, and the
Fiscal Incentives Review Board exempting the National Power
Corporation from indirect tax and duties; 48 (f) the orders of the Energy
Regulatory Board of 5 and 6 December 1990 on the ground that the
hearings conducted on the second provisional increase in oil prices did
not allow the petitioner substantial cross-examination; 49 (g) Executive
Order No. 478 which levied a special duty of P0.95 per liter or P151.05
per barrel of imported crude oil and P1.00 per liter of imported oil
products; 50 (h) resolutions of the Commission on Elections concerning
the apportionment, by district, of the number of elective members of
Sanggunians; 51 and (i) memorandum orders issued by a Mayor
affecting the Chief of Police of Pasay City.52
In the 1975 case of Aquino vs. Commission on Elections, 53 this Court,
despite its unequivocal ruling that the petitioners therein had no
personality to file the petition, resolved nevertheless to pass upon the
issues raised because of the far-reaching implications of the petition.
We did no less in De Guia vs. COMELEC 54 where, although we
declared that De Guia "does not appear to have locus standi, a
standing in law, a personal or substantial interest," we brushed aside
the procedural infirmity "considering the importance of the issue
involved, concerning as it does the political exercise of qualified voters
affected by the apportionment, and petitioner alleging abuse of
discretion and violation of the Constitution by respondent."
We find the instant petition to be of transcendental importance to the
public. The issues it raised are of paramount public interest and of a
category even higher than those involved in many of the aforecited
cases. The ramifications of such issues immeasurably affect the social,
economic, and moral well-being of the people even in the remotest
barangays of the country and the counter-productive and retrogressive
effects of the envisioned on-line lottery system are as staggering as the
billions in pesos it is expected to raise. The legal standing then of the
petitioners deserves recognition and, in the exercise of its sound
discretion, this Court hereby brushes aside the procedural barrier which
the respondents tried to take advantage of.
And now on the substantive issue.
Section 1 of R.A. No. 1169, as amending by B.P. Blg. 42, prohibits the
PCSO from holding and conducting lotteries "in collaboration,
association or joint venture with any person, association, company or
entity, whether domestic or foreign." Section 1 provides:
Sec. 1. The Philippine Charity Sweepstakes Office.
— The Philippine Charity Sweepstakes Office,
hereinafter designated the Office, shall be the
principal government agency for raising and
providing for funds for health programs, medical
assistance and services and charities of national
character, and as such shall have the general
powers conferred in section thirteen of Act
Numbered One thousand four hundred fifty-nine, as
amended, and shall have the authority:
A. To hold and conduct charity
sweepstakes races, lotteries and
other similar activities, in such
frequency and manner, as shall
be determined, and subject to
such rules and regulations as
shall be promulgated by the
Board of Directors.
B. Subject to the approval of the
Minister of Human Settlements,
to engage in health and welfare-
related investments, programs,
projects and activities which may
be profit-oriented, by itself or in
collaboration, association or joint
venture with any person,
association, company or entity,
whether domestic or foreign,
except for the activities
mentioned in the preceding
paragraph (A), for the purpose of
providing for permanent and
continuing sources of funds for
health programs, including the
expansion of existing ones,
medical assistance and services,
and/or charitable grants:
Provided, That such investment
will not compete with the private
sector in areas where
investments are adequate as
may be determined by the
National Economic and
Development Authority.
(emphasis supplied)
The language of the section is indisputably clear that with respect to its
franchise or privilege "to hold and conduct charity sweepstakes races,
lotteries and other similar activities," the PCSO cannot exercise it "in
collaboration, association or joint venture" with any other party. This is
the unequivocal meaning and import of the phrase "except for the
activities mentioned in the preceding paragraph (A)," namely, "charity
sweepstakes races, lotteries and other similar activities."
B.P. Blg. 42 originated from Parliamentary Bill No. 622, which was
covered by Committee Report No. 103 as reported out by the
Committee on Socio-Economic Planning and Development of the
Interim Batasang Pambansa. The original text of paragraph B, Section
1 of Parliamentary Bill No. 622 reads as follows:
To engage in any and all investments and related
profit-oriented projects or programs and activities by
itself or in collaboration, association or joint venture
with any person, association, company or entity,
whether domestic or foreign, for the main purpose of
raising funds for health and medical assistance and
services and charitable grants. 55
During the period of committee amendments, the Committee on Socio-
Economic Planning and Development, through Assemblyman Ronaldo
B. Zamora, introduced an amendment by substitution to the said
paragraph B such that, as amended, it should read as follows:
Subject to the approval of the Minister of Human
Settlements, to engage in health-oriented
investments, programs, projects and activities which
may be profit- oriented, by itself or in collaboration,
association, or joint venture with any person,
association, company or entity, whether domestic or
foreign, for the purpose of providing for permanent
and continuing sources of funds for health
programs, including the expansion of existing ones,
medical assistance and services and/or charitable
grants. 56
Before the motion of Assemblyman Zamora for the approval of the
amendment could be acted upon, Assemblyman Davide introduced an
amendment to the amendment:
MR. DAVIDE.
Mr. Speaker.
THE SPEAKER.
The gentleman from Cebu is
recognized.
MR. DAVIDE.
May I introduce an amendment
to the committee amendment?
The amendment would be to
insert after "foreign" in the
amendment just read the
following: EXCEPT FOR THE
ACTIVITY IN LETTER (A)
ABOVE.
When it is joint venture or in
collaboration with any entity such
collaboration or joint venture
must not include activity activity
letter (a) which is the holding and
conducting of sweepstakes
races, lotteries and other similar
acts.
MR. ZAMORA.
We accept the amendment, Mr.
Speaker.
MR. DAVIDE.
Thank you, Mr. Speaker.
THE SPEAKER.
Is there any objection to the
amendment? (Silence) The
amendment, as amended, is
approved. 57
Further amendments to paragraph B were introduced and approved.
When Assemblyman Zamora read the final text of paragraph B as
further amended, the earlier approved amendment of Assemblyman
Davide became "EXCEPT FOR THE ACTIVITIES MENTIONED IN
PARAGRAPH (A)"; and by virtue of the amendment introduced by
Assemblyman Emmanuel Pelaez, the word PRECEDING was inserted
before PARAGRAPH. Assemblyman Pelaez introduced other
amendments. Thereafter, the new paragraph B was approved. 58
This is now paragraph B, Section 1 of R.A. No. 1169, as amended by
B.P. Blg. 42.
No interpretation of the said provision to relax or circumvent the
prohibition can be allowed since the privilege to hold or conduct charity
sweepstakes races, lotteries, or other similar activities is a franchise
granted by the legislature to the PCSO. It is a settled rule that "in all
grants by the government to individuals or corporations of rights,
privileges and franchises, the words are to be taken most strongly
against the grantee .... [o]ne who claims a franchise or privilege in
derogation of the common rights of the public must prove his title
thereto by a grant which is clearly and definitely expressed, and he
cannot enlarge it by equivocal or doubtful provisions or by probable
inferences. Whatever is not unequivocally granted is withheld. Nothing
passes by mere implication." 59
In short then, by the exception explicitly made in paragraph B, Section
1 of its charter, the PCSO cannot share its franchise with another by
way of collaboration, association or joint venture. Neither can it assign,
transfer, or lease such franchise. It has been said that "the rights and
privileges conferred under a franchise may, without doubt, be assigned
or transferred when the grant is to the grantee and assigns, or is
authorized by statute. On the other hand, the right of transfer or
assignment may be restricted by statute or the constitution, or be made
subject to the approval of the grantor or a governmental agency, such
as a public utilities commission, exception that an existing right of
assignment cannot be impaired by subsequent legislation." 60
It may also be pointed out that the franchise granted to the PCSO to
hold and conduct lotteries allows it to hold and conduct a species of
gambling. It is settled that "a statute which authorizes the carrying on of
a gambling activity or business should be strictly construed and every
reasonable doubt so resolved as to limit the powers and rights claimed
under its authority." 61
Does the challenged Contract of Lease violate or contravene the
exception in Section 1 of R.A. No. 1169, as amended by B.P. Blg. 42,
which prohibits the PCSO from holding and conducting lotteries "in
collaboration, association or joint venture with" another?
We agree with the petitioners that it does, notwithstanding its
denomination or designation as a (Contract of Lease). We are neither
convinced nor moved or fazed by the insistence and forceful arguments
of the PGMC that it does not because in reality it is only an independent
contractor for a piece of work, i.e., the building and maintenance of a
lottery system to be used by the PCSO in the operation of its lottery
franchise. Whether the contract in question is one of lease or whether
the PGMC is merely an independent contractor should not be decided
on the basis of the title or designation of the contract but by the intent of
the parties, which may be gathered from the provisions of the contract
itself. Animus hominis est anima scripti. The intention of the party is the
soul of the instrument. In order to give life or effect to an instrument, it is
essential to look to the intention of the individual who executed it. 62
And, pursuant to Article 1371 of the Civil Code, "to determine the
intention of the contracting parties, their contemporaneous and
subsequent acts shall be principally considered." To put it more bluntly,
no one should be deceived by the title or designation of a contract.
A careful analysis and evaluation of the provisions of the contract and a
consideration of the contemporaneous acts of the PCSO and PGMC
indubitably disclose that the contract is not in reality a contract of lease
under which the PGMC is merely an independent contractor for a piece
of work, but one where the statutorily proscribed collaboration or
association, in the least, or joint venture, at the most, exists between
the contracting parties. Collaboration is defined as the acts of working
together in a joint project. 63 Association means the act of a number of
persons in uniting together for some special purpose or business. 64
Joint venture is defined as an association of persons or companies
jointly undertaking some commercial enterprise; generally all contribute
assets and share risks. It requires a community of interest in the
performance of the subject matter, a right to direct and govern the
policy in connection therewith, and duty, which may be altered by
agreement to share both in profit and
losses.65
The contemporaneous acts of the PCSO and the PGMC reveal that the
PCSO had neither funds of its own nor the expertise to operate and
manage an on-line lottery system, and that although it wished to have
the system, it would have it "at no expense or risks to the government."
Because of these serious constraints and unwillingness to bear
expenses and assume risks, the PCSO was candid enough to state in
its RFP that it is seeking for "a suitable contractor which shall build, at
its own expense, all the facilities needed to operate and maintain" the
system; exclusively bear "all capital, operating expenses and expansion
expenses and risks"; and submit "a comprehensive nationwide lottery
development plan . . . which will include the game, the marketing of the
games, and the logistics to introduce the game to all the cities and
municipalities of the country within five (5) years"; and that the
operation of the on-line lottery system should be "at no expense or risk
to the government" — meaning itself, since it is a government-owned
and controlled agency. The facilities referred to means "all capital
equipment, computers, terminals, software, nationwide
telecommunications network, ticket sales offices, furnishings and
fixtures, printing costs, costs of salaries and wages, advertising and
promotions expenses, maintenance costs, expansion and replacement
costs, security and insurance, and all other related expenses needed to
operate a nationwide on-line lottery system."
In short, the only contribution the PCSO would have is its franchise or
authority to operate the on-line lottery system; with the rest, including
the risks of the business, being borne by the proponent or bidder. It
could be for this reason that it warned that "the proponent must be able
to stand to the acid test of proving that it is an entity able to take on the
role of responsible maintainer of the on-line lottery system." The PCSO,
however, makes it clear in its RFP that the proponent can propose a
period of the contract which shall not exceed fifteen years, during which
time it is assured of a "rental" which shall not exceed 12% of gross
receipts. As admitted by the PGMC, upon learning of the PCSO's
decision, the Berjaya Group Berhad, with its affiliates, wanted to offer
its services and resources to the PCSO. Forthwith, it organized the
PGMC as "a medium through which the technical and management
services required for the project would be offered and delivered to
PCSO." 66
Undoubtedly, then, the Berjaya Group Berhad knew all along that in
connection with an on-line lottery system, the PCSO had nothing but its
franchise, which it solemnly guaranteed it had in the General
Information of the RFP. 67 Howsoever viewed then, from the very
inception, the PCSO and the PGMC mutually understood that any
arrangement between them would necessarily leave to the PGMC the
technical, operations, and management aspects of the on-line lottery
system while the PCSO would, primarily, provide the franchise. The
words Gaming and Management in the corporate name of respondent
Philippine Gaming Management Corporation could not have been
conceived just for euphemistic purposes. Of course, the RFP cannot
substitute for the Contract of Lease which was subsequently executed
by the PCSO and the PGMC. Nevertheless, the Contract of Lease
incorporates their intention and understanding.
The so-called Contract of Lease is not, therefore, what it purports to be.
Its denomination as such is a crafty device, carefully conceived, to
provide a built-in defense in the event that the agreement is questioned
as violative of the exception in Section 1 (B) of the PCSO's charter. The
acuity or skill of its draftsmen to accomplish that purpose easily
manifests itself in the Contract of Lease. It is outstanding for its careful
and meticulous drafting designed to give an immediate impression that
it is a contract of lease. Yet, woven therein are provisions which negate
its title and betray the true intention of the parties to be in or to have a
joint venture for a period of eight years in the operation and
maintenance of the on-line lottery system.
Consistent with the above observations on the RFP, the PCSO has
only its franchise to offer, while the PGMC represents and warrants that
it has access to all managerial and technical expertise to promptly and
effectively carry out the terms of the contract. And, for a period of eight
years, the PGMC is under obligation to keep all the Facilities in safe
condition and if necessary, upgrade, replace, and improve them from
time to time as new technology develops to make the on-line lottery
system more cost-effective and competitive; exclusively bear all costs
and expenses relating to the printing, manpower, salaries and wages,
advertising and promotion, maintenance, expansion and replacement,
security and insurance, and all other related expenses needed to
operate the on-line lottery system; undertake a positive advertising and
promotions campaign for both institutional and product lines without
engaging in negative advertising against other lessors; bear the
salaries and related costs of skilled and qualified personnel for
administrative and technical operations; comply with procedural and
coordinating rules issued by the PCSO; and to train PCSO and other
local personnel and to effect the transfer of technology and other
expertise, such that at the end of the term of the contract, the PCSO
will be able to effectively take over the Facilities and efficiently operate
the on-line lottery system. The latter simply means that, indeed, the
managers, technicians or employees who shall operate the on-line
lottery system are not managers, technicians or employees of the
PCSO, but of the PGMC and that it is only after the expiration of the
contract that the PCSO will operate the system. After eight years, the
PCSO would automatically become the owner of the Facilities without
any other further consideration.
For these reasons, too, the PGMC has the initial prerogative to prepare
the detailed plan of all games and the marketing thereof, and determine
the number of players, value of winnings, and the logistics required to
introduce the games, including the Master Games Plan. Of course, the
PCSO has the reserved authority to disapprove them. 68 And, while the
PCSO has the sole responsibility over the appointment of dealers and
retailers throughout the country, the PGMC may, nevertheless,
recommend for appointment dealers and retailers which shall be acted
upon by the PCSO within forty-eight hours and collect and retain, for its
own account, a security deposit from dealers and retailers in respect of
equipment supplied by it.
This joint venture is further established by the following:
(a) Rent is defined in the lease contract as the amount to be paid to the
PGMC as compensation for the fulfillment of its obligations under the
contract, including, but not limited to the lease of the Facilities.
However, this rent is not actually a fixed amount. Although it is stated to
be 4.9% of gross receipts from ticket sales, payable net of taxes
required by law to be withheld, it may be drastically reduced or, in
extreme cases, nothing may be due or demandable at all because the
PGMC binds itself to "bear all risks if the revenue from the ticket sales,
on an annualized basis, are insufficient to pay the entire prize money."
This risk-bearing provision is unusual in a lessor-lessee relationship,
but inherent in a joint venture.
(b) In the event of pre-termination of the contract by the PCSO, or its
suspension of operation of the on-line lottery system in breach of the
contract and through no fault of the PGMC, the PCSO binds itself "to
promptly, and in any event not later than sixty (60) days, reimburse the
Lessor the amount of its total investment cost associated with the On-
Line Lottery System, including but not limited to the cost of the
Facilities, and further compensate the LESSOR for loss of expected net
profit after tax, computed over the unexpired term of the lease." If the
contract were indeed one of lease, the payment of the expected profits
or rentals for the unexpired portion of the term of the contract would be
enough.
(c) The PGMC cannot "directly or indirectly undertake any activity or
business in competition with or adverse to the On-Line Lottery System
of PCSO unless it obtains the latter's prior written consent." If the
PGMC is engaged in the business of leasing equipment and technology
for an on-line lottery system, we fail to see any acceptable reason why
it should allow a restriction on the pursuit of such business.
(d) The PGMC shall provide the PCSO the audited Annual Report sent
to its stockholders, and within two years from the effectivity of the
contract, cause itself to be listed in the local stock exchange and offer
at least 25% of its equity to the public. If the PGMC is merely a lessor,
this imposition is unreasonable and whimsical, and could only be tied
up to the fact that the PGMC will actually operate and manage the
system; hence, increasing public participation in the corporation would
enhance public interest.
(e) The PGMC shall put up an Escrow Deposit of P300,000,000.00
pursuant to the requirements of the RFP, which it may, at its option,
maintain as its initial performance bond required to ensure its faithful
compliance with the terms of the contract.
(f) The PCSO shall designate the necessary personnel to monitor and
audit the daily performance of the on-line lottery system; and
promulgate procedural and coordinating rules governing all activities
relating to the on-line lottery system. The first further confirms that it is
the PGMC which will operate the system and the PCSO may, for the
protection of its interest, monitor and audit the daily performance of the
system. The second admits the coordinating and cooperative powers
and functions of the parties.
(g) The PCSO may validly terminate the contract if the PGMC becomes
insolvent or bankrupt or is unable to pay its debts, or if it stops or
suspends or threatens to stop or suspend payment of all or a material
part of its debts.
All of the foregoing unmistakably confirm the indispensable role of the
PGMC in the pursuit, operation, conduct, and management of the On-
Line Lottery System. They exhibit and demonstrate the parties'
indivisible community of interest in the conception, birth and growth of
the on-line lottery, and, above all, in its profits, with each having a right
in the formulation and implementation of policies related to the business
and sharing, as well, in the losses — with the PGMC bearing the
greatest burden because of its assumption of expenses and risks, and
the PCSO the least, because of its confessed unwillingness to bear
expenses and risks. In a manner of speaking, each is wed to the other
for better or for worse. In the final analysis, however, in the light of the
PCSO's RFP and the above highlighted provisions, as well as the "Hold
Harmless Clause" of the Contract of Lease, it is even safe to conclude
that the actual lessor in this case is the PCSO and the subject matter
thereof is its franchise to hold and conduct lotteries since it is, in reality,
the PGMC which operates and manages the on-line lottery system for a
period of eight years.
We thus declare that the challenged Contract of Lease violates the
exception provided for in paragraph B, Section 1 of R.A. No. 1169, as
amended by B.P. Blg. 42, and is, therefore, invalid for being contrary to
law. This conclusion renders unnecessary further discussion on the
other issues raised by the petitioners.
WHEREFORE, the instant petition is hereby GRANTED and the
challenged Contract of Lease executed on 17 December 1993 by
respondent Philippine Charity Sweepstakes Office (PCSO) and
respondent Philippine Gaming Management Corporation (PGMC) is
hereby DECLARED contrary to law and invalid.
The Temporary Restraining Order issued on 11 April 1994 is hereby
MADE PERMANENT.
No pronouncement as to costs.
SO ORDERED.
Separate Opinions
CRUZ, J., concurring:
I am happy to join Mr. Justice Hilario G. Davide, Jr. in his excellent
ponencia. I will add the following personal observations only for
emphasis as it is not necessary to supplement his thorough exposition.
The respondents take great pains to cite specific provisions of the
contract to show that it is PCSO that is actually operating the on-line
lottery, but they have not succeeded in disproving the obvious, to wit,
that the document was intentionally so crafted to make it appear that
the operation is not a joint undertaking of PCSO and PGMC but a mere
lease of services. It is a clever instrument, to be sure, but we are,
gratifyingly, not deluded. Lawyers have a special talent to disguise the
real intention of the parties in a contract to make it come ostensibly
within the provisions of a law although the real if furtive purpose is to
violate it. That talent has been exercised in this case, but not
convincingly enough.
It should be quite clear, from the adroit way the contract has been
drafted, that the primary objective was to avoid the conclusion that
PCSO will be operating a lottery "in association, collaboration or joint
venture with any person, association, company or entity," which is
prohibited by Section 1 of Rep. Act No. 1169 as amended by B.P. Blg.
42. Citing the self-serving provisions of the contract, the respondents
would have us believe that the contract is perfectly lawful because all it
does is provide for the lease to PCSO of the technical know-how and
equipment of PGMC, with PCSO acting as "the sole and individual
operator" of the lottery. I am glad we are not succumbing to this
sophistry.
Despite the artfulness of the contract (authorship of which was
pointedly denied by both counsel for the government and the private
respondent during the oral argument on this case), a careful study will
reveal telling stipulations that it is PGMC and not PCSO that will
actually be operating the lottery. Thus, it is provided inter alia that
PGMC shall furnish all capital equipment and other facilities needed for
the operation; bear all expenses relating to the operation, including
those for the salaries and wages of the administrative and technical
personnel; undertake a positive advertising and promotion campaign for
public support of the lottery; establish a radio communications network
throughout the country as part of the operation; and assume all risks if
the revenues from ticket sales are insufficient to pay the entire prize
money. Most significantly, to show that it is only after eight years from
the effectivity of the contract that PCSO will actually operate the lottery,
Par. 6.7 of the agreement provides that PGMC shall:
6.7. Upon effectivity of this Contract, commence the
training of PCSO and other local personnel and the
transfer of technology and expertise, such that at
the end of the term of this Contract, PCSO will be
able to effectively take-over the Facilities and
efficiently operate the On-Line Lottery System.
(Emphasis supplied).
In the meantime, that is to say during the entire 8-year term of the
contract, it will be PGMC that will be operating the lottery. Only "at the
end of the term of this Contract" will PCSO "be able to effectively take-
over the Facilities and efficiently operate the On-Line Lottery System."
Even on the assumption that it is PCSO that will be operating the lottery
at the very start, the authority granted to PGMC by the agreement will
readily show that PCSO will not be acting alone, as the respondents
pretend. In fact, it cannot. PGMC is an indispensable co-worker
because it has the equipment and the technology and the management
skills that PCSO does not have at this time for the operation of the
lottery, PCSO cannot deny that it needs the assistance of PGMC for
this purpose, which was its reason for entering into the contract in the
first place.
And when PCSO does avail itself of such assistance, how will it be
operating the lottery? Undoubtedly, it will be doing so "in collaboration,
association or joint venture" with PGMC, which, let it be added, will not
be serving as a mere "hired help" of PCSO subject to its control. PGMC
will be functioning independently in the discharge of its own assigned
role as stipulated in detail under the contract. PGMC is plainly a partner
of PCSO in violation of law, no matter how PGMC's assistance is called
or the contract is denominated.
Even if it be conceded that the assistance partakes of a lease of
services, the undeniable fact is that PCSO would still be collaborating
or cooperating with PGMC in the operation of the lottery. What is even
worse is that PCSO and PGMC may be actually engaged in a joint
venture, considering that PGMC does not collect the usual fixed rentals
due an ordinary lessor but is entitled to a special "Rental Fee," as the
contract calls it, "equal to four point nine percent (4.9%) of gross
receipts from ticket sales."
The flexibility of this amount is significant. As may be expected, it will
induce in PGMC an active interest and participation in the success of
PCSO that is not expected of an ordinary detached lessor who gets to
be paid his rentals — not a rental fee — whether the lessee's business
prospers or not. PGMC's share in the operation depends on its own
performance and the effectiveness of its collaboration with PCSO.
Although the contract pretends otherwise, PGMC is a co-investor with
PCSO in what is practically, if not in a strictly legal sense, a joint
venture.
Concerning the doctrine of locus standi, I cannot agree that out of the
sixty million Filipinos affected by the proposed lottery, not a single
solitary citizen can question the agreement. Locus standi is not such an
absolute rule that it cannot admit of exceptions under certain conditions
or circumstances like those attending this transaction. As I remarked in
my dissent in Guazon v. De Villa, 181 SCRA 623, "It is not only the
owner of the burning house who has the right to call the firemen. Every
one has the right and responsibility to prevent the fire from spreading
even if he lives in the other block."
What is especially galling is that the transaction in question would foist
upon our people an essentially immoral activity through the
instrumentality of a foreign corporation, which naturally does not have
the same concern for our interests as we ourselves have. I am
distressed that foreigners should be allowed to exploit the weakness of
some of us for instant gain without work, and with the active
collaboration and encouragement of our own government at that.
Feliciano, J., concurring
I agree with the conclusions reached by my distinguished brother in the
Court Davide, Jr., J., both in respect of the question of locus standi and
in respect of the merits of this case, that is, the issues of legality and
constitutionality of the Contract of Lease entered into between the
Philippine Charity Sweepstakes Office (PCSO) and the Philippine
Gaming Management Corporation (PGMC).
In this separate opinion, I propose to address only the question of locus
standi. It is with some hesitation that I do so, considering the extensive
separate opinions on this question written by my learned brothers Melo,
Puno and Vitug, JJ. I agree with the great deal of what my brothers
Melo, Puno and Vitug say about locus standi in their separate opinions
and there is no need to go over the ground that I share with them.
Because, however, I reach a different conclusion in respect of the
presence or absence of locus standi on the part of the petitioners in the
case before the Court, there is an internal need (a need internal to
myself) to articulate the considerations which led me to that conclusion.
There is no dispute that the doctrine of locus standi reflects an
important constitutional principle, that is, the principle of separation of
powers which, among other things, mandates that each of the great
Departments of government is responsible for performance of its
constitutionally allotted tasks. Insofar as the Judicial Department is
concerned, the exercise of judicial power and carrying out of judicial
functions commonly take place within the context of actual cases or
controversies. This, in turn, reflects the basic notion of judicial power as
the power to resolve actual disputes and of the traditional business of
courts as the hearing and deciding of specific controversies brought
before them. In our own jurisdiction, and at least since the turn of the
present century, judicial power has always included the power of
judicial review, understood as the authority of courts (more specifically
the Supreme Court) to assay contested legislative and executive acts in
terms of their constitutionality or legality. Thus, the general proposition
has been that a petitioner who assails the legal or constitutional quality
of an executive or legislative act must be able to show that he has
locus standi. Otherwise, the petition becomes vulnerable to prompt
dismissal by the court.
There is, upon the other hand, little substantive dispute that the
possession of locus standi 1 is not, in each and every case, a rigid and
absolute requirement for access to the courts. Certainly that is the case
where great issues of public law are at stake, issues which cannot be
approached in the same way that a court approaches a suit for the
collection of a sum of money or a complaint for the recovery of
possession of a particular piece of land. The broad question is when, or
in what types of cases, the court should insist on a clear showing of
locus standi understood as a direct and personal interest in the subject
matter of the case at bar, and when the court may or should relax that
apparently stringent requirement and proceed to deal with the legal or
constitutional issues at stake in a particular case.
I submit, with respect, that it is not enough for the Court simply to
invoke "public interest" or even "paramount considerations of national
interest," and to say that the specific requirements of such public
interest can only be ascertained on a "case to case" basis. For one
thing, such an approach is not intellectually satisfying. For another,
such an answer appears to come too close to saying that locus standi
exists whenever at least a majority of the Members of this Court
participating in a case feel that an appropriate case for judicial
intervention has arisen.
This is not, however, to say that there is somewhere an over-arching
juridical principle or theory, waiting to be discovered, that permits a
ready answer to the question of when, or in what types of cases, the
need to show locus standi may be relaxed in greater or lesser degree.
To my knowledge, no satisfactory principle or theory has been
discovered and none has been crafted, whether in our jurisdiction or in
the United States. 2 I have neither the competence nor the opportunity
to try to craft such principle or formula. It might, however, be useful to
attempt to indicate the considerations of principle which, in the present
case, appear to me to require an affirmative answer to the question of
whether or not petitioners are properly regarded as imbued with the
standing necessary to bring and maintain the present petition.
Firstly, the character of the funds or other assets involved in the case is
of major importance. In the case presently before the Court, the funds
involved are clearly public in nature. The funds to be generated by the
proposed lottery are to be raised from the population at large. Should
the proposed operation be as successful as its proponents project,
those funds will come from well-nigh every town and barrio of Luzon.
The funds here involved are public in another very real sense: they will
belong to the PCSO, a government owned or controlled corporation
and an instrumentality of the government and are destined for utilization
in social development projects which, at least in principle, are designed
to benefit the general public. My learned brothers Melo, Puno and
Vitug, JJ. concede that taxpayers' suits have been recognized as an
exception to the traditional requirement of recognized as an exception
to the traditional requirement of locus standi. They insist, however, that
because the funds here involved will not have been generated by the
exercise of the taxing power of the Government, the present petition
cannot be regarded as a taxpayer's suit and therefore, must be
dismissed by the Court. It is my respectful submission that that
constitutes much too narrow a conception of the taxpayer's suit and of
the public policy that it embodies. It is also to overlook the fact that tax
monies, strictly so called, constitute only one (1) of the major categories
of funds today raised and used for public purposes. It is widely known
that the principal sources of funding for government operations today
include, not just taxes and customs duties, but also revenues derived
from activities of the Philippine Amusement Gaming Corporation
(PAGCOR), as well as the proceeds of privatization of government
owned or controlled corporations and other government owned assets.
The interest of a private citizen in seeing to it that public funds, from
whatever source they may have been derived, go only to the uses
directed and permitted by law is as real and personal and substantial as
the interest of a private taxpayer in seeing to it that tax monies are not
intercepted on their way to the public treasury or otherwise diverted
from uses prescribed or allowed by law. It is also pertinent to note that
the more successful the government is in raising revenues by non-
traditional methods such as PAGCOR operations and privatization
measures, the lesser will be the pressure upon the traditional sources
of public revenues, i.e., the pocket books of individual taxpayers and
importers.
A second factor of high relevance is the presence of a clear case of
disregard of a constitutional or statutory prohibition by the public
respondent agency or instrumentality of the government. A showing
that a constitutional or legal provision is patently being disregarded by
the agency or instrumentality whose act is being assailed, can scarcely
be disregarded by court. The concept of locus standi — which is part
and parcel of the broader notion of ripeness of the case — "does not
operate independently and is not alone decisive. . . . [I]t is in substantial
part a function of a judge's estimate of the merits of the constitutional
[or legal] issue." 3 The notion of locus standi and the judge's
conclusions about the merits of the case, in other words, interact with
each other. Where the Court perceives a serious issue of violation of
some constitutional or statutory limitation, it will be much less difficult
for the Court to find locus standi in the petitioner and to confront the
legal or constitutional issue. In the present case, the majority of the
Court considers that a very substantial showing has been made that the
Contract of Lease between the PCSO and the PGMC flies in the face of
legal limitations.
A third consideration of importance in the present case is the lack of
any other party with a more direct and specific interest in raising the
questions here being raised. Though a public bidding was held, no
losing or dissatisfied bidder has come before the Court. The Office of
the Ombudsman has not, to the knowledge of the Court, raised
questions about the legality or constitutionality of the Contract of Lease
here involved. The National Government itself, through the Office of the
Solicitor General, is defending the PCSO Contract (though it had not
participated in the drafting thereof). In a situation like that here
obtaining, the submission may be made that the institution, so well
known in corporation law and practice, of the corporate stockholders'
derivative suit furnishes an appropriate analogy and that on the basis of
such an analogy, a taxpayer's derivative suit should be recognized as
available.
The wide range of impact of the Contract of Lease here assailed and of
its implementation, constitutes still another consideration of
significance. In the case at bar, the agreement if implemented will be
practically nationwide in its scope and reach (the PCSO-PGMC
Contract is limited in its application to the Island of Luzon; but if the
PCSO Contracts with the other two [2] private "gaming management"
corporations in respect of the Visayas and Mindanao are substantially
similar to PCSO's Contract with PGMC, then the Contract before us
may be said to be national indeed in its implications and
consequences). Necessarily, the amounts of money expected to be
raised by the proposed activities of the PCSO and PGMC will be very
substantial, probably in the hundreds of millions of pesos. It is not easy
to conceive of a contract with greater and more far-reaching
consequences, literally speaking, for the country than the Contract of
Lease here involved. Thus, the subject matter of the petition is not
something that the Court may casually pass over as unimportant and
as not warranting the expenditure of significant judicial resources.
In the examination of the various features of this case, the above
considerations have appeared to me to be important and as pressing
for acceptance and exercise of jurisdiction on the part of this Court. It is
with these considerations in mind that I vote to grant due course to the
Petition and to hold that the Contract of Lease between the PCSO and
PGMC in its present form and content, and given the present state of
the law, is fatally defective.
PADILLA, J., concurring:
My views against gambling are a matter of judicial record. In Basco v.
PAGCOR, (G.R. No. 91649, 14 May 1991, 197 SCRA 52) I expressed
these views in a separate opinion where I was joined by that
outstanding lady jurist, Mme. Justice A. Melencio-Herrera whose
incisive approach to legal problems is today missed in this Court. I
reproduce here those views because they are highly persuasive to the
conclusions I reach in the present controversy:
I concur in the result of the learned decision penned
by my brother Mr. Justice Paras. This means that I
agree with the decision insofar as it holds that the
prohibition, control, and regulation of the entire
activity known as gambling properly pertain to "state
policy." It is, therefore, the political departments of
government, namely, the legislative and the
executive that should decide on what government
should do in the entire area of gambling, and
assume full responsibility to the people for such
policy.
The courts, as the decision states, cannot inquire
into the wisdom, morality or expediency of policies
adopted by the political departments of government
in areas which fall within their authority, except only
when such policies pose a clear and present danger
to the life, liberty or property of the individual. This
case does not involve such a factual situation.
However, I hasten to make of record that I do not
subscribe to gambling in any form. It demeans the
human personality, destroys self-confidence and
eviscerates one's self-respect, which in the long run
will corrode whatever is left of the Filipino moral
character. Gambling has wrecked and will continue
to wreck families and homes; it is an antithesis to
individual reliance and reliability as well as personal
industry which are the touchstones of real economic
progress and national development.
Gambling is reprehensible whether maintained by
government or privatized. The revenues realized by
the government out of "legalized" gambling will, in
the long run, be more than offset and negated by the
irreparable damage to the people's moral values.
Also, the moral standing of the government in its
repeated avowals against "illegal gambling" is fatally
flawed and becomes untenable when it itself
engages in the very activity it seeks to eradicate.
One can go through the Court's decision today and
mentally replace the activity referred to therein as
gambling, which is legal only because it is
authorized by law and run by the government, with
the activity known as prostitution. Would prostitution
be any less reprehensible were it to be authorized
by law, franchised, and "regulated" by the
government, in return for the substantial revenues it
would yield the government to carry out its laudable
projects, such as infrastructure and social
amelioration? The question, I believe, answers itself.
I submit that the sooner the legislative department
outlaws all forms of gambling, as a fundamental
state policy, and the sooner the executive
implements such policy, the better it will be for the
nation.
We presently have the sweepstakes lotteries; we already have the
PAGCOR's gambling casinos; the Filipino people will soon, if plans do
not miscarry, be initiated into an even more sophisticated and
encompassing nationwide gambling network known as the "on-line hi-
tech lotto system." To be sure, it is not wealth producing; it is not export
oriented. It will draw from existing wealth in the hands of Filipinos and
transfer it into the coffers of the PCSO and its foreign partners at a
price of further debasement of the moral standards of the Filipino
people, the bulk of whom are barely subsisting below the poverty line.
1. It is said that petitioners 1 have no locus standi to
bring this suit even as they challenge the legality
and constitutionality of a contract of lease between
the PCSO, a government-owned corporation and
the PGMC, a private corporation with substantial (if
not controlling) foreign composition and content.
Such contract of lease contains the terms and
conditions under which an "on-line hi-tech lotto
system" will operate in the country.
As the ponente of the extended, unsigned en banc resolution in
Valmonte v. PCSO, (G.R. No. 78716 and G.R. No. 79084, 22
September 1987), I would be the last to downgrade the rule, therein
reiterated, that in order to maintain a suit challenging the
constitutionality and/or legality of a statute, order or regulation or
assailing a particular governmental action as done with grave abuse of
discretion or with lack of jurisdiction, the petitioner must show that he
has a clear personal or legal right that would be violated with the
enforcement of the challenged statute, order or regulation or the
implementation of the questioned governmental action. But, in my
considered view, this rule maybe (and should be) relaxed when the
issue involved or raised in the petition is of such paramount national
interest and importance as to dwarf the above procedural rule into a
barren technicality. As a unanimous Court en banc aptly put it in De
Guia vs. COMELEC, G.R. No. 104712, 6 May 1992, 208 SCRA 420.
Before addressing the crux of the controversy, the
Court observes that petitioner does not allege that
he is running for re-election, much less, that he is
prejudiced by the election, by district, in Parañaque.
As such, he does not appear to have locus standi, a
standing in law, a personal or substantial interest.
(Sanidad vs. COMELEC, G.R. No. L-4640, October
12, 1976. 73 SCRA 333; Municipality of Malabang
vs. Benito, G.R. No. L-28113, March 28, 1969, 27
SCRA 533) He does not also allege any legal right
that has been violated by respondent. If for this
alone, petitioner does not appear to have any cause
of action.
However, considering the importance of the issue
involved, concerning as it does the political exercise
of qualified voters affected by the apportionment,
and petitioner alleging abuse of discretion and
violation of the Constitution by respondent, We
resolved to brush aside the question of procedural
infirmity, even as We perceive the petition to be one
of declaratory relief. We so held similarly through
Mr. Justice Edgardo L. Paras in Osmeña vs.
Commission on Elections.
I view the present case as falling within the De Guia case doctrine. For,
when the contract of lease in question seeks to establish and operate a
nationwide gambling network with substantial if not controlling foreign
participation, then the issue is of paramount national interest and
importance as to justify and warrant a relaxation of the above-
mentioned procedural rule on locus standi.
2. The charter of the PCSO — Republic Act No.
1169 as amended by BP No. 42 — insofar as
relevant, reads:
Sec. 1. The Philippine Charity Sweepstakes Office.
— The Philippine Charity Sweepstakes Office,
hereinafter designated the Office, shall be the
principal government agency for raising and
providing for funds for health programs, medical
assistance and services and charities of national
character, and as such shall have the general
powers conferred in section thirteen of Act
Numbered One Thousand Four Hundred Fifty-Nine,
as amended, and shall have the authority:
A. To hold and conduct charity sweepstakes races,
lotteries and other similar activities, in such
frequency and manner, as shall be determined, and
subject to such rules and regulations as shall be
promulgated by the Board of Directors.
B. Subject to the approval of the Minister of Human
Settlements, to engage in health and welfare-related
investments, programs, projects and activities which
may be profit-oriented, by itself or in collaboration,
association or joint venture with any person,
association, company or entity, whether domestic or
foreign, except for the activities mentioned in the
preceding paragraph (A), for the purpose of
providing for permanent and continuing sources of
funds for health programs, including the expansion
of existing ones, medical assistance and services,
and/or charitable grants: Provided, That such
investments will not compete with the private sector
in areas where investments are adequate as may be
determined by the National Economic and
Development Authority.
It is at once clear from the foregoing legal provisions that, while the
PCSO charter allows the PCSO to itself engage in lotteries, it does not
however permit the PCSO to undertake or engage in lotteries in
"collaboration, association or joint venture" with others. The palpable
reason for this prohibition is, that PCSO should not and cannot be
made a vehicle for an otherwise prohibited foreign or domestic entity to
engage in lotteries (gambling activities) in the Philippines.
The core question then is whether the lease contract between PCSO
and PGMC is a device whereby PCSO will engage in lottery in
collaboration, association or joint venture with another, i.e. PGMC. I
need not go here into the details and different specific features of the
contract to show that it is a joint venture between PCSO and PGMC.
That has been taken care of in the opinion of Mr. Justice Davide to
which I fully subscribe.
On a slightly different plane and, perhaps simplified, I consider the
agreement or arrangement between the PCSO and PGMC a joint
venture because each party to the contract contributes its share in the
enterprise or project. PGMC contributes its facilities, equipment and
know-how (expertise). PCSO contributes (aside from its charter) the
market, directly or through dealers — and this to me is most important
— in the totality or mass of the Filipino gambling elements who will
invest in lotto tickets. PGMC will get its 4.9% of gross receipts (with
assumption of certain risks in the course of lotto operations); the
residue of the whole exercise will go to PCSO. To any person with a
minimum of business know-how, this is a joint venture between PCSO
and PGMC, plain and simple.
But assuming ex gratia argumenti that such arrangement between
PCSO and PGMC is not a joint venture between the two of them to
install and operate an "on-line hi-tech lotto system" in the country, it can
hardly be denied that it is, at the very least, an association or
collaboration between PCSO and PGMC. For one cannot do without
the other in the installation, operation and, most importantly, marketing
of the entire enterprise or project in this country.
Indeed, the contract of lease in question is a clear violation of Republic
Act No. 1169 as amended by BP No. 42 (the PCSO charter).
Having arrived at the conclusion that the contract of lease in question
between the PCSO and PGMC is illegal and, therefore, invalid, I find it
unnecessary to dwell on the other issues raised in the pleadings and
arguments of the parties.
I, therefore, vote to give DUE COURSE to the petition and to declare
the contract of lease in question between PCSO and PGMC, for the
reasons aforestated, of no force and effect.
MELO, J., dissenting:
I submit that the petition before the Court deserves no less than outright
dismissal for the reason that petitioners, as concerned citizens and as
taxpayers and as members of Congress, do not possess the necessary
legal standing to assail the validity of the contract of lease entered into
by the Philippine Charity Sweepstakes Office and the Philippine
Gaming Management Corporation relative to the establishment and
operation of an "On-line Hi-Tech Lottery System" in the country.
As announced in Lamb vs. Phipps (22 Phil. [1912], 559), "[J]udicial
power in its nature, is the power to hear and decide causes pending
between parties who have the right to sue and be sued in the courts of
law and equity." Necessarily, this implies that a party must show a
personal stake in the outcome of the controversy or an injury to himself
that can be addressed by a favorable decision so as to warrant his
invocation of the court's jurisdiction and to justify the court's remedial
powers in his behalf (Warth vs. Seldin, 422 U.S. 490; Guzman vs.
Marrero, 180 U.S. 81; McMicken vs. United States, 97 U.S. 204). Here,
we have yet to see any of petitioners acquiring a personal stake in the
outcome of the controversy or being placed in a situation whereby
injury may be sustained if the contract of lease in question is
implemented. It may be that the contract has somehow evoked public
interest which petitioners claim to represent. But the alleged public
interest which they pretend to represent is not only broad and
encompassing but also strikingly and veritably indeterminate that one
cannot truly say whether a handful of the public, like herein petitioners,
may lay a valid claim of representation in behalf of the millions of
citizens spread all over the land who may have just as many varied
reactions relative to the contract in question.
Any effort to infuse personality on petitioners by considering the present
case as a "taxpayer's suit" could not cure the lack of locus standi on the
part of petitioners. As understood in this jurisdiction, a "taxpayer's suit"
refers to a case where the act complained of directly involves the illegal
disbursement of public funds derived from taxation (Pascual vs.
Secretary of Public Works, 110 Phil. [1960] 331; Maceda vs. Macaraig,
197 SCRA [1991]; Lozada vs. COMELEC, 120 SCRA [1983] 337;
Dumlao vs. COMELEC, 95 SCRA [1980] 392; Gonzales vs. Marcos, 65
SCRA [1975] 624). It cannot be overstressed that no public fund raised
by taxation is involved in this case. In fact, it is even doubtful if the
rentals which the PCSO will pay to the lessor for its operation of the
lottery system may be regarded as "public fund". The PCSO is not a
revenue- collecting arm of the government. Income or money realized
by it from its operations will not and need not be turned over to the
National Treasury. Rather, this will constitute corporate funds which will
remain with the corporation to finance its various activities as
authorized in its charter. And if ever some semblance of "public
character" may be said to attach to its earnings, it is simply because
PCSO is a government-owned or controlled entity and not a purely
private enterprise.
It must be conceded though that a "taxpayer's suit" had been allowed in
a number of instances in this jurisdiction. For sure, after the trial was
blazed by Pascual vs. Secretary of Public Works, supra, several more
followed. It is to be noted, however, that in those occasions where this
Court allowed such a suit, the case invariably involved either the
constitutionality of a statute or the legality of the disbursement of public
funds through the enforcement of what was perceived to be an invalid
or unconstitutional statute or legislation (Pascual, supra; Philippine
Constitution Association, Inc. vs. Jimenez, 15 SCRA [1965] 479;
Philippine Constitution Association, Inc. vs. Mathay, 18 SCRA [1966]
300; Tolentino vs. COMELEC, 41 SCRA [1971] 702; Pelaez vs. Auditor
General, 15 SCRA [1965] 569; Iloilo Palay and Corn Planters
Association vs. Feliciano, 13 SCRA [1965] 377).
The case before us is not a challenge to the validity of a statute or an
attempt to restrain expenditure of public funds pursuant to an alleged
invalid congressional enactment. What petitioners ask us to do is to
nullify a simple contract of lease entered into by a government-owned
corporation with a private entity. That contract, as earlier pointed out,
does not involve the disbursement of public funds but of strictly
corporate money. If every taxpayer, claiming to have interest in the
contract, no matter how remote, could come to this Court and seek
nullification of said contract, the day may come when the activities of
government corporate entities will ground to a standstill on account of
nuisance suits filed against them by persons whose supposed interest
in the contract is as remote and as obscure as the interest of any man
in the street. The dangers attendant thereto are not hard to discern and
this Court must not allow them to come to pass.
One final observation must be emphasized. When the petition at bench
was filed, the Court decided to hear the case on oral argument on the
initial perception that a constitutional issue could be involved. However,
it now appears that no question of constitutional dimension is at stake
as indeed the majority barely touches on such an issue, concentrating
as it does on its interpretation of the contract between the Philippine
Charity Sweepstakes Office and the Philippine Gaming Management
Corporation.
I, therefore, vote to dismiss the petition.
PUNO, J., dissenting:
At the outset, let me state that my religious faith and family upbringing
compel me to regard gambling, regardless of its garb, with hostile eyes.
Such antagonism tempts me to view the case at bench as a struggle
between good and evil, a fight between the forces of light against the
forces of darkness. I will not, however, yield to that temptation for we
are not judges of the Old Testament type who were not only arbiters of
law but were also high priests of morality.
I will therefore strictly confine the peregrinations of my mind to the legal
issues for resolution: (1) whether or not the petitioners have the Locus
standi to file the petition at bench; and (2) assuming their locus standi,
whether or not the Contract of Lease between PCSO and PGMC is null
and void considering: (a) section 1 of R.A. No. 1169, as amended by
B.P. Blg. 42 (Charter of PCSO) which prohibits PCSO from holding and
conducting lotteries "in collaboration, association or joint venture with
any person, association, company or entity"; (b) Act No. 3836 which
requires a congressional franchise before any person or entity can
establish and operate a telecommunication system; (c) section 11, Art.
XII of the Constitution, which requires that for a corporation to operate a
public utility, at least 60% of its capital must be owned by Filipino
citizens; and (d) R.A. No. 7042, otherwise known as the "Foreign
Investments Act", which includes all forms of gambling in its "negative
list."
While the legal issues abound, I deferentially submit that the threshold
issue is the locus standi, or standing to sue, of petitioners. The petition
describes petitioner Kilosbayan, Inc., as a non-stock corporation
composed of "civic spirited citizens, pastors, priests, nuns, and lay
leaders who are committed to the cause of truth, justice, and national
renewal." 1 Petitioners Jovito R. Salonga, Cirilo A. Rigos, Ernie Camba,
Emilio C. Capulong, Jr., Jose Abcede, Christine Tan, Felipe L. Gozon,
Rafael G. Fernando, Raoul V. Victorino, Jose Cunanan, and Quintin S.
Doromal joined the petition in their capacity as trustees of Kilosbayan,
Inc., and as taxpayers and concerned citizens. 2 Petitioners Freddie
Webb and Wigberto Tañada joined the petition as senators, taxpayers
and concerned citizens. 3 Petitioner Joker P. Arroyo joined the petition
as a member of the House of Representative, a taxpayer and a
concerned citizen. 4
With due respect to the majority opinion, I wish to focus on the
interstices of locus standi, a concept described by Prof. Paul Freund as
"among the most amorphous in the entire domain of public law." The
requirement of standing to sue inheres from the definition of judicial
power. It is not merely a technical rule of procedure which we are at
liberty to disregard. Section 1, Article VIII of the Constitution provides:
xxx xxx xxx
Judicial power includes the duty of the courts of
justice to settle actual controversies involving rights
which are legally demandable and enforceable, and
to determine whether or not there has been a grave
abuse of discretion amounting to lack or excess of
jurisdiction on the part of any branch or
instrumentality of the Government. (Italics supplied)
The phrase "actual controversies involving rights which are legally
demandable and enforceable" has acquired a cultivated meaning given
by courts. It spells out the requirements that must be satisfied before
one can come to court to litigate a constitutional issue. Our
distinguished colleague, Mr. Justice Isagani A. Cruz, gives a shorthand
summary of these requirements when he states that no constitutional
question will be heard and decided by courts unless there is a showing
of the following: . . . (1) there must be an actual case or controversy; (2)
the question of constitutionality must be raised by the proper party; (3)
the constitutional question must be raised at the earliest possible
opportunity; and (4) the decision of the constitutional question must be
necessary to the determination of the case itself. 5
The complexion of the rule on locus standi has been undergoing a
change. Mr. Justice Cruz has observed the continuing relaxation of the
rule on
standing, 6 thus:
xxx xxx xxx
A proper party is one who has sustained or is in
immediate danger of sustaining an injury as a result
of the act complained of. Until and unless such
actual or potential injury is established, the
complainant cannot have the legal personality to
raise the constitutional question.
In Tileson v. Ullmann, a physician questioned the
constitutionality of a law prohibiting the use of
contraceptives, upon the ground that it might prove
dangerous to the life or health of some of his
patients whose physical condition would not enable
them to bear the rigors of childbirth. The court
dismissed the challenge, holding that the patients of
the physician and not the physician himself were the
proper parties.
In Cuyegkeng v. Cruz, the petitioner challenged in a
quo warranto proceeding the title of the respondent
who, he claimed, had been appointed to the board
of medical examiners in violation of the provisions of
the Medical Act of 1959. The Supreme Court
dismissed the petition, holding that Cuyegkeng had
not made a claim to the position held by Cruz and
therefore could not be regarded as a proper party
who had sustained an injury as a result of the
questioned act.
In People v. Vera, it was held that the Government
of the Philippines was a proper party to challenge
the constitutionality of the Probation Act because,
more than any other, it was the government itself
that should be concerned over the validity of its own
laws.
In Ex Parte Levitt, the petitioner, an American
taxpayer and member of the bar, filed a motion for
leave to question the qualifications of Justice Black
who, he averred, had been appointed to the U.S.
Supreme Court in violation of the Constitution of the
United States. The Court dismissed the petition,
holding that Levitt was not a proper party since he
was not claiming the position held by Justice Black.
The rule before was that an ordinary taxpayer did
not have the proper party personality to question the
legality of an appropriation law since his interest in
the sum appropriated was not substantial enough.
Thus, in Custodio v. Senate President, a challenge
by an ordinary taxpayer to the validity of a law
granting back pay to government officials, including
members of Congress, during the period
corresponding to the Japanese Occupation was
dismissed as having been commenced by one who
was not a proper party.
Since the first Emergency Powers Cases, however,
the rule has been changed and it is now permissible
for an ordinary taxpayer, or a group of taxpayers, to
raise the question of the validity of an appropriation
law. As the Supreme Court then put it. "The
transcendental importance to the public of these
cases demands that they be settled promptly and
definitely, brushing aside, if we must, technicalities
of procedure."
In Tolentino v. Commission on Elections, it was held
that a senator had the proper party personality to
seek the prohibition of a plebiscite for the ratification
of a proposed constitutional amendment. In
PHILCONSA v. Jimenez, an organization of
taxpayers and citizens was held to be a proper party
to question the constitutionality of a law providing for
special retirement benefits for members of the
legislature.
 In Sanidad v. Commission on Elections, the
Supreme Court upheld the petitioners as proper
parties, thus —
As a preliminary resolution, We
rule that the petitioners in L-
44640 (Pablo C. Sanidad and
Pablito V. Sanidad) possess
locus standi to challenge the
constitutional premise of
Presidential Decree Nos. 991,
1031, and 1033. It is now an
ancient rule that the valid source
of a statute — Presidential
Decrees are of such nature —
may be contested by one who
will sustain a direct injury as a
result of its enforcement. At the
instance of taxpayers, laws
providing for the disbursement of
public funds may be enjoined,
upon the theory that the
expenditure of public funds by an
officer of the State for the
purpose of executing an
unconstitutional act constitutes a
misapplication of such funds.
The breadth of Presidential
Decree No. 991 carries an
appropriation of Five Million
Pesos for the effective
implementation of its purposes.
Presidential Decree No. 1031
appropriates the sum of Eight
Million Pesos to carry out its
provisions. The interest of the
aforenamed petitioners as
taxpayers in the lawful
expenditure of these amounts of
public money sufficiently clothes
them with that personality to
litigate the validity of the Decrees
appropriating said funds.
Moreover, as regard taxpayer's
suits, this Court enjoys that open
discretion to entertain the same
or not. For the present case, We
deem it sound to exercise that
discretion affirmatively so that
the authority upon which the
disputed Decrees are predicated
may be inquired into.
In Lozada v. Commission on Elections, however, the
petitioners were held without legal standing to
demand the filling of vacancies in the legislature
because they had only "a generalized interest'
shared with the rest of the citizenry."
Last July 30, 1993, we further relaxed the rule on standing in Oposa, et
al. v. Hon. Fulgencio S. Factoran, Jr., 7 where we recognized the locus
standi of minors representing themselves as well as generations
unborn to protect their constitutional right to a balanced and healthful
ecology.
I am perfectly at peace with the drift of our decisions liberalizing the rule
on locus standi. The once stubborn disinclination to decide
constitutional issues due to lack of locus standi is incompatible with the
expansion of judicial power mandated in section 1 of Article VIII of the
Constitution, i.e., "to determine whether or not there has been a grave
abuse of discretion, amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the government." As we held
thru the ground breaking ponencia of Mr. Justice Cruz in Daza v.
Singson, 8 this provision no longer precludes the Court from resolving
political questions in proper cases. But even perusing this provision as
a constitutional warrant for the court to enter the once forbidden political
thicket, it is clear that the requirement of locus standi has not been
jettisoned by the Constitution for it still commands courts in no
uncertain terms to settle only "actual controversies involving rights
which are legally demandable and enforceable." Stated otherwise,
courts are neither free to decide all kinds of cases dumped into their
laps nor are they free to open their doors to all parties or entities
claiming a grievance. The rationale for this constitutional requirement of
locus standi is by no means trifle. It is intended "to assure a vigorous
adversary presentation of the case, and, perhaps more importantly to
warrant the judiciary's overruling the determination of a coordinate,
democratically elected organ of government." 9 It thus goes to the very
essence of representative democracies. As Mr. Justice Powell carefully
explained in U.S. v.
Richardson, 10 viz:
Relaxation of standing requirements is directly
related to the expansion of judicial power. It seems
to me inescapable that allowing unrestricted
taxpayer or citizen standing would significantly alter
the allocation of power at the national level, with a
shift away from a democratic form of government. I
also believe that repeated and essentially head-on
confrontations between the life-tenured branch and
the representative branches of government will not,
in the long run, be beneficial to either. The public
confidence essential to the former and the vitality
critical to the latter may well erode if we do not
exercise self- restraint in the utilization of our power
to negative the actions of the other branches. We
should be ever mindful of the contradictions that
would arise if a democracy were to permit at large
oversight of the elected branches of government by
a non-representative, and in large measure
insulated, judicial branch. Moreover, the argument
that the Court should allow unrestricted taxpayer or
citizen standing underestimates the ability of the
representative branches of the Federal Government
to respond to the citizen pressure that has been
responsible in large measure for the current drift
toward expanded standing. Indeed, taxpayer or
citizen advocacy, given its potentially broad base, is
precisely the type of leverage that in a democracy
ought to be employed against the branches that
were intended to be responsive to public attitudes
about the appropriate operation of government. "We
must as judges recall that, as Mr. Justice Holmes
wisely observed, the other branches of Government
are ultimate guardians of the liberties and welfare of
the people in quite as great a degree as the courts."
Unrestrained standing in federal taxpayer or citizen
suits would create a remarkably illogical system of
judicial supervision of the coordinate branches of the
Federal Government. Randolph's proposed Council
of Revision, which was repeatedly rejected by the
Framers, at least had the virtue of being systematic;
every law passed by the legislature automatically
would have been previewed by the judiciary before
the law could take effect. On the other hand, since
the judiciary cannot select the taxpayers or citizens
who bring suit or the nature of the suits, the
allowance of public actions would produce uneven
and sporadic review, the quality of which would be
influenced by the resources and skill of the particular
plaintiff. And issues would be presented in abstract
form, contrary to the Court's recognition that "judicial
review is effective largely because it is not available
simply at the behest of a partisan faction, but is
exercised only to remedy a particular, concrete
injury." Sierra Club v. Morton, 405 U.S. 727, 740-
741, n. 16 (1972).
A lesser but not insignificant reason for screening the standing of
persons who desire to litigate constitutional issues is economic in
character. Given the sparseness of our resources, the capacity of
courts to render efficient judicial service to our people is severely
limited. For courts to indiscriminately open their doors to all types of
suits and suitors is for them to unduly overburden their dockets, and
ultimately render themselves ineffective dispensers of justice. To be
sure, this is an evil that clearly confronts our judiciary today.
Prescinding from these premises, and with great reluctance, I am not
prepared to concede the standing to sue of petitioners. On a personal
level, they have not shown that elemental injury in fact which will endow
them with a standing to sue. It must be stressed that petitioners are in
the main, seeking the nullity not of a law but of a Contract of Lease. Not
one of the petitioners is a party to the Contract of Lease executed
between PCSO and PGMC. None of the petitioners participated in the
bidding, and hence they are not losing bidders. They are complete
strangers to the contract. They stand neither to gain nor to lose
economically by its enforcement. It seems to me unusual that an
unaffected third party to a contract could be allowed to question its
validity. Petitioner Kilosbayan cannot justify this officious interference
on the ground of its commitment to "truth, justice and national renewal."
Such commitment to truth, justice and national renewal, however noble
it may be, cannot give Kilosbayan a roving commission to check the
validity of contracts entered into by the government and its agencies.
Kilosbayan is not a private commission on audit.
Neither can I perceive how the other petitioners can be personally
injured by the Contract of Lease between PCSO and PGMC even if
petitioner Salonga assails as unmitigated fraud the statistical probability
of winning the lotto as he compared it to the probability of being struck
twice by lightning. The reason is obvious: none of the petitioners will be
exposed to this alleged fraud for all of them profess to abjure playing
the lotto. It is self-evident that lotto cannot physically or spiritually injure
him who does not indulge in it.
Petitioners also contend they have locus standi as taxpayers. But the
case at bench does not involve any expenditure of public money on the
part of PCSO. In fact, paragraph 2 of the Contract of Lease provides
that it is PGMC that shall build, furnish, and maintain at its own
expense and risk the facilities for the On-Line Lottery System of PCSO
and shall bear all maintenance and other costs. Thus, PGMC alleged it
has already spent P245M in equipment and fixtures and would be
investing close to P1 billion to supply adequately the technology and
other requirements of PCSO. 11 If no tax money is being illegally
deflected in the Contract of Lease between PCSO and PGMC,
petitioners have no standing to impugn its validity as taxpayers. Our
ruling in Dumlao v. Comelec, 12 settled this issue well enough, viz:
However, the statutory provisions questioned in this
case, namely, sec. 7, BP Blg. 51, and sections 4, 1,
and 5 BP Blg. 52, do not directly involve the
disbursement of public funds. While, concededly,
the elections to be held involve the expenditure of
public moneys, nowhere in their Petition do said
petitioners allege that their tax money is "being
extracted and spent in violation of specific
constitutional protections against abuses of
legislative power" (Flast v. Cohen, 392 U.S. 83
[1960]), or that there is a misapplication of such
funds by respondent COMELEC (see Pascual vs.
Secretary of Public Works, 110 Phil. 331 [1960]), or
that public money is being deflected to any improper
purpose. Neither do petitioners seek to restrain
respondent from wasting public funds through the
enforcement of an invalid or unconstitutional law.
(Philippine Constitution Association vs. Mathay, 18
SCRA 300 [1966]), citing Philippine Constitution
Association vs. Gimenez, 15 SCRA 479 [1965]).
Besides, the institution of a taxpayer's suit, per se, is
no assurance of judicial review. As held by this
Court in Yan vs. Macapagal (43 SCRA 677 [1972]),
speaking through our present Chief Justice, this
Court is vested with discretion as to whether or not a
taxpayer's suit should be entertained.
Next, petitioners plead their standing as "concerned citizens." As
citizens, petitioners are pleading that they be allowed to advocate the
constitutional rights of other persons who are not before the court and
whose protection is allegedly their concern. A citizen qua citizen suit
urges a greater relaxation of the rule on locus standi. I feel no aversion
to the further relaxation of the rule on standing to accommodate what in
other jurisdictions is known as an assertion of jus tertii in constitutional
litigation provided the claimant can demonstrate: (1) an injury in fact to
himself, and (2) the need to prevent the erosion of a preferred
constitutional right of a third person. As stressed before, the first
requirement of injury in fact cannot be abandoned for it is an essential
element for the exercise of judicial power. Again, as stressed by Mr.
Justice Powell, viz: 13
The revolution in standing doctrine that has
occurred, particularly in the 12 years since Baker v.
Carr, supra, has not meant, however, that standing
barriers have disappeared altogether. As the Court
noted in Sierra Club, "broadening the categories of
injury that may be alleged in support of standing is a
different matter from abandoning the requirement
that the party seeking review must himself have
suffered an injury." 405 U.S., at 738 . . . Indeed,
despite the diminution of standing requirements in
the last decade, the Court has not broken with the
traditional requirement that, in the absence of a
specific statutory grant of the right of review, a
plaintiff must allege some particularized injury that
sets him apart from the man on the street.
I recognize that the Court's allegiance to a
requirement of particularized injury has on occasion
required a reading of the concept that threatens to
transform it beyond recognition. E.G., Baker v. Carr,
supra; Flast v. Cohen, supra. But despite such
occasional digressions, the requirement remains,
and I think it does so for the reasons outlined above.
In recognition of those considerations, we should
refuse to go the last mile towards abolition of
standing requirements that is implicit in broadening
the "precarious opening" for federal taxpayers
created by Flast, see 392 U.S., at 116 (Mr. Justice
Fortas, concurring) or in allowing a citizen qua
citizen to invoke the power of the federal courts to
negative unconstitutional acts of the Federal
Government.
In sum, I believe we should limit the expansion of
federal taxpayer and citizen standing in the absence
of specific statutory authorization to an outer
boundary drawn by the results in Flast and Baker v.
Carr. I think we should face up to the fact that all
such suits are an effort "to employ a federal court as
a forum in which to air . . . generalized grievances
about the conduct of government or the allocation of
power in the Federal System." Flast v. Cohen, 392
U.S., at 106. The Court should explicitly reaffirm
traditional prudential barriers against such public
actions. My reasons for this view are rooted in
respect for democratic processes and in the
conviction that "[t]he powers of the federal judiciary
will be adequate for the great burdens placed upon
them only if they are employed prudently, with
recognition of the strengths as well as the hazards
that go with our kind of representative government."
Id., at 131
The second requirement recognizes society's right in the protection of
certain preferred rights in the Constitution even when the rightholders
are not before the court. The theory is that their dilution has a
substantial fall out detriment to the rights of others, hence the latter can
vindicate them.
In the case at bench, it is difficult to see how petitioners can satisfy
these two requirements to maintain a jus tertii claim. They claim
violation of two constitutional provisions, to wit:
Section 1, Article XIII. — The Congress shall give
highest priority to the enactment of measures that
protect and enhance the right of all the people to
human dignity, reduce social, economic, and
political inequalities, and remove cultural inequities
by equitably diffusing wealth and political power for
the common good.
To this end, the State shall regulate the acquisition,
ownership, use, and disposition of property and its
increments.
and
Section 11, Article XII. - No franchise, certificate, or
any other form of authorization for the operation of a
public utility shall be granted except to citizens of the
Philippines or to corporations or associations
organized under the laws of the Philippines at least
sixty per centum of whose capital is owned by such
citizens, nor shall such franchise, certificate, or
authorizations be exclusive in character or for a
longer period than fifty years. Neither shall any such
franchise or right be granted except under the
condition that it shall be subject to amendment,
alteration, or repeal by the Congress when the
common good so requires. The State shall
encourage equity participation in public utilities by
the general public. The participation of foreign
investors in the governing body of any public utility
enterprise shall be limited to their proportionate
share in its capital, and all the executive and
managing officers of such corporation or association
must be citizen of the Philippines.
Section 1, Article XIII of the Constitution cannot be the matrix of
petitioners' jus tertii claim for it expresses no more than a policy
direction to the legislative in the discharge of its ordained duty — to
give highest priority to the enactment of measures that protect and
enhance the right of all the people to human dignity, reduce social,
economic, and political inequalities and remove cultural inequities by
equitably diffusing wealth and political power for the common good.
Whether the act of the legislature in amending the charter of PCSO by
giving it the authority to conduct lotto and whether the Contract of
Lease entered into between PCSO and PGMC are incongruent to the
policy direction of this constitutional provision is a highly debatable
proposition and can be endlessly argued. Respondents steadfastly
insist that the operation of lotto will increase the revenue base of PCSO
and enable government to provide a wider range of social services to
the people. They also allege that the operation of high-tech lotto will
eradicate illegal jueteng. Petitioners are scandalized by this
submission. They dismiss gambling as evil per se and castigate
government for attempting to correct a wrong by committing another
wrong. In any event, the proper forum for this debate, however
cerebrally exciting it may be, is not this court but congress. So we held
in PCSO v. Inopiquez, to wit: 14
By bringing their suit in the lower court, the private
respondents in G.R. No. 79084 do not question the
power of PCSO to conduct the Instant Sweepstakes
game. Rather, they assail the wisdom of embarking
upon this project because of their fear of the
"pernicious repercussions" which may be brought
about by the Instant Sweepstakes Game which they
 have labelled as "the worst form of gambling" which
thus "affects the moral values" of the people.
The Court, as held in several cases, does not pass
upon questions of wisdom, justice, or expediency of
legislation and executive acts. It is not the province
of the courts to supervise legislation or executive
orders as to keep them within the bounds of
propriety, moral values and common sense. That is
primarily and even exclusively a concern of the
political departments of the government; otherwise,
there will be a violation of the principle of separation
of powers. (Italics supplied)
I am not also convinced that petitioners can justify their locus standi to
advocate the rights of hypothetical third parties not before the court by
invoking the need to keep inviolate section 11, Article XII of the
Constitution which imposes a nationality requirement on operators of a
public utility. For even assuming arguendo that PGMC is a public utility,
still, the records do not at the moment bear out the claim of petitioners
that PGMC is a foreign owned and controlled corporation. This factual
issue remains unsettled and is still the subject of litigation by the parties
in the Securities and Exchange Commission. We are not at liberty to
anticipate the verdict on this contested factual issue. But over and
above this consideration, I respectfully submit that this constitutional
provision does not confer on third parties any right of a preferred status
comparable to the Bill of Rights whose dilution will justify petitioners to
vindicate them in behalf of its rightholders. The legal right of
hypothetical third parties they profess to advocate is to my mind too
impersonal, too unsubstantial, too indirect, too amorphous to justify
their access to this Court and the further lowering of the constitutional
barrier of locus standi.
Again, with regret, I do not agree that the distinguished status of some
of the petitioners as lawmakers gives them the appropriate locus standi.
I cannot perceive how their constitutional rights and prerogatives as
legislators can be adversely affected by the contract in question. Their
right to enact laws for the general conduct of our society remains
unimpaired and undiminished. 15 Their status as legislators,
notwithstanding, they have to demonstrate that the said contract has
caused them to suffer a personal, direct, and substantial injury in fact.
They cannot simply advance a generic grievance in common with the
people in general.
I am not unaware of our ruling in De Guia v. Comelec, 16 viz:
Before addressing the crux of the controversy, the
Court observes that petitioner does not allege that
he is running for reelection, much less, that he is
prejudiced by the election, by district, in Parañaque.
As such, he does not appear to have locus standi, a
standing in law, a personal or substantial interest.
(Sanidad vs. COMELEC, G.R. No. L-44640, October
12, 1976, 73 SCRA 333; Municipality of Malabang
vs. Benito, G.R. No. L-28113, March 28, 1969, 27
SCRA 533). He does not also allege any legal right
that has been violated by respondent. If for this
alone, petitioner does not appear to have any cause
of action.
However, considering the importance of the issue
involved, concerning as it does the political exercise
of qualified voters affected by the apportionment,
and petitioner alleging abuse of discretion and
violation of the Constitution by respondent, We
resolved to brush aside the question of procedural
infirmity, even as We perceive the petition to be one
of declaratory relief. We so held similarly through
Mr. Justice Edgardo L. Paras in Osmena vs.
Commission on Elections.
It is my respectful submission, however, that we should re-examine de
Guia. It treated the rule on locus standi as a mere procedural rule. It is
not a plain procedural rule but a constitutional requirement derived from
section 1, Article VIII of the Constitution which mandates courts of
justice to settle only "actual controversies involving rights which are
legally demandable and enforceable." The phrase has been construed
since time immemorial to mean that a party in a constitutional litigation
must demonstrate a standing to sue. By downgrading the requirement
on locus standi as a procedural rule which can be discarded in the
name of public interest, we are in effect amending the Constitution by
judicial fiat.
De Guia would also brush aside the rule on locus standi if a case raises
an important issue. In this regard, I join the learned observation of Mr.
Justice Feliciano: "that it is not enough for the Court simply to invoke
'public interest' or even 'paramount considerations of national interest,'
and to say that the specific requirements of such public interest can
only be ascertained on a 'case to case' basis. For one thing, such an
approach is not intellectually satisfying. For another, such an answer
appears to come too close to saying that locus standi exists whenever
at least a majority of the Members of this Court participating in a case
feel that an appropriate case for judicial intervention has arisen."
I also submit that de Guia failed to perceive that the rule on locus
standi has little to do with the issue posed in a case, however,
important it may be. As well pointed out in Flast v. Cohen: 17
The fundamental aspect of standing is that it
focuses on the party seeking to get his complaint
before a federal court and not on the issues he
wishes to have adjudicated. The "gist of the
question of standing" is whether the party seeking
relief has "alleged such a personal stake in the
outcome of the controversy as to assure that
concrete adverseness which sharpens the
presentation of issues upon which the court so
largely depends for illumination of difficult
constitutional questions." Baker v. Carr, 369 U.S.
186, 204 (1962). In other words, when standing is
placed in issue in a case, the question is whether
the person whose standing is challenged is a proper
party to request an adjudication of a particular issue
and not whether the issue itself is justiciable. Thus,
a party may have standing in a particular case, but
the federal court may nevertheless decline to pass
on the merits of the case because, for example, it
presents a political question. A proper party is
demanded so that federal courts will not be asked to
decide "ill-defined controversies over constitutional
issues," United public Workers v. Mitchell, 330 U.S.
75, 90 (1947), or a case which is of "a hypothetical
or abstract character," Aetna Life Insurance Co. v.
Haworth, 300 U.S. 227, 240 (1937).
It is plain to see that in de Guia, the court took an unorthodox posture,
to say the least. It held there was no proper party before it, and yet it
resolved the issues posed by the petition. As there was no proper party
before the court, its decision is vulnerable to be criticized as an
advisory opinion.
With due respect, the majority decision appears to have set a
dangerous precedent by unduly trivializing the rule on locus standi. By
its decision, the majority has entertained a public action to annul a
private contract. In so doing, the majority may have given sixty (60)
million Filipinos the standing to assail contracts of government and its
agencies. This is an invitation for chaos to visit our law on contract, and
certainly will not sit well with prospective foreign investors. Indeed, it is
difficult to tread the path of the majority on this significant issue. The
majority granted locus standi to petitioners because of lack of any other
party with more direct and specific interest. But one has standing
because he has standing on his own and standing cannot be acquired
because others with standing have refused to come to court. The thesis
is also floated that petitioners have standing as they can be considered
taxpayers with right to file derivative suit like a stockholder's derivative
suit in private corporations. The fact, however, is that PCSO is not a
private but a quasi-public corporation. Our law on private corporation
categorically sanctions stockholder's derivative suit. In contrast, our law
on public corporation does not recognize this so-called taxpayer's
derivative suit. Hence, the idea of a taxpayer's derivative suit, while
alluring, has no legal warrant.
Our brethren in the majority have also taken the unprecedented step of
striking down a contrast at the importunings of strangers thereto, but
without justifying the interposition of judicial power on any felt need to
prevent violation of an important constitutional provision. The contract
in question was voided on the sole ground that it violated an ordinary
statute, section 1 of R.A. 1169, as amended by B.P. Blg. 42. If there is
no provision of the Constitution that is involved in the case at bench, it
boggles the mind how the majority can invoke considerations of
national interest to justify its abandonment of the rule on locus standi.
The volume of noise created by the case cannot magically convert it to
a case of paramount national importance. By its ruling, the majority has
pushed the Court in unchartered water bereft of any compass, and it
may have foisted the false hope that it is the repository of all remedies.
If I pay an unwavering reverence to the rule of locus standi, it is
because I consider it as a touchstone in maintaining the proper balance
of power among the three branches of our government. The survival of
our democracy rests in a large measure on our ability to maintain this
delicate equipoise of powers. For this reason, I look at judicial review
from a distinct prism. I see it both as a power and a duty. It is a power
because it enables the judiciary to check excesses of the Executive and
the Legislative. But, it is also a duty because its requirement of locus
standi, among others, Executive and the Legislative. But, it is also a
duty because its requirement of locus standi, among others, keeps the
judiciary from overreaching the powers of the other branches of
government. By balancing this duality, we are able to breathe life to the
principle of separation of powers and prevent tyranny. To be sure, it is
our eternal concern to prevent tyranny but that includes tyranny by
ourselves. The Constitution did not install a government by the
judiciary, nay, not a government by the unelected. In offering this
submission, I reject the sublimal fear that an unyielding insistence on
the rule on locus standi will weaken the judiciary vis-a-vis the other
branches of government. The hindsight of history ought to tell us that it
is not power per se that strengthens. Power unused is preferable than
power misused. We contribute to constitutionalism both by the use of
our power to decide and its non use. As well said, the cases we decide
are as significant as the cases we do not decide. Real power belongs to
him who has power over power.
IN VIEW WHEREOF, and strictly on the ground of lack of locus standi
on the part of petitioners, I vote to DENY the petition.
VITUG, J., dissenting:
Judicial power encompasses both an authority and duty to resolve
"actual controversies involving rights which are legally demandable and
enforceable" (Article VIII, Section 1, 1987 Constitution). As early as the
case of Lamb vs. Phipps, 1 this Court ruled: "Judicial power, in its
nature, is the power to hear and decide causes pending between
parties who have the right to sue in the courts of law and equity." 2 An
essential part of, and corollary to, this principle is the locus standi of a
party litigant, referring to one who is directly affected by, and whose
interest is immediate and substantial in, the controversy. The rule
requires that a party must show a personal stake in the outcome of the
case or an injury to himself that can be redressed by a favorable
decision so as to warrant his invocation of the court's jurisdiction and to
justify the exercise of the court's remedial powers in his behalf. 3 If it
were otherwise, the exercise of that power can easily become too
unwieldy by its sheer magnitude and scope to a point that may, in no
small degree, adversely affect its intended essentiality, stability and
consequentiality.
Locus standi, nevertheless, admits of the so-called "taxpayer's suit."
Taxpayer's suits are actions or proceedings initiated by one or more
taxpayers in their own behalf or, conjunctively, in representation of
others similarly situated for the purpose of declaring illegal or
unauthorized certain acts of public officials which are claimed to be
injurious to their common interests as such taxpayers (Cf. 71 Am Jur
2d., 179-180). The principle is predicated upon the theory that
taxpayers are, in equity, the cestui que trust of tax funds, and any illegal
diminution thereof by public officials constitutes a breach of trust even
as it may result in an increased burden on taxpayers (Haddock vs.
Board of Public Education, 86 A 2d 157; Henderson vs. McCormick, 17
ALR 2d 470).
Justice Brandeis of the United States Supreme Court, in his concurring
opinion in Ashwander vs. Tennessee Valley Authority (297 U.S. 288),
said:
. . . . The Court will not pass upon the validity of a
statute upon complaint of one who fails to show that
he is injured by its operation. Tyler v. The Judges,
179 U.S. 405; Hendrick v. Maryland, 234 U.S. 610,
621. Among the many applications of this rule, none
is more striking than the denial of the right of
challenge to one who lacks a personal or property
right. Thus, the challenge by a public official
interested only in the performance of his official duty
will not be entertained. Columbus & Greenville Ry.
v. Miller, 283 U.S. 96, 99-100. In Fairchild v.
Hughes, 258 U.S. 126, the Court affirmed the
dismissal of a suit brought by a citizen who sought
to have the Nineteenth Amendment declared
unconstitutional. In Massachusetts v. Mellon, 262
U.S. 447, the challenge of the federal Maternity Act
was not entertained although made by the
Commonwealth on behalf of all its citizens."
Justice Brandeis' view, shared by Justice Frankfurter in Joint Anti-
Fascist Refugee Commission vs. McGrath (351 U.S. 123), was adopted
by the U.S. Supreme Court in Flast vs. Cohen (392 U.S. 83) which held
that it is only when a litigant is able to show such a personal stake in
the controversy as to assure a concrete adverseness in the issues
submitted that legal standing can attach.
A "taxpayer's suit," enough to confer locus standi to a party, we have
held before, is understood to be a case where the act complained of
directly involves the illegal disbursement of public funds derived from
taxation.4 It is not enough that the dispute concerns public funds. A
contrary rule could easily lead to a limitless application of the term
"taxpayer's suit," already by itself a broad concept, since a questioned
act of government would almost so invariably entail, as a practical
matter, a financial burden of some kind.
To be sure, serious doubts have even been raised on the propriety and
feasibility of unqualifiedly recognizing the "taxpayer's suit" as an
exception from the standard rule of requiring a party who invokes the
exercise of judicial power to have a real and personal interest or a
direct injury in the outcome of a controversy. This Court has heretofore
spoken on the matter, at times even venturing beyond the usual
understanding of its applicability in the name of national or public
interest. It is remarkable, nevertheless, that the accepted connotation of
locus standi has still managed to be the rule, sanctioning, by way of
exception, the so-called "taxpayer's suit" which courts accept on valid
and compelling reasons.
A provision which has been introduced by the 1987 Constitution is a
definition, for the first time in our fundamental law, of the term "judicial
power," as such authority and duty of courts of justice "to settle actual
controversies involving rights which are legally demandable and
enforceable and to determine whether or not there has been a grave
abuse of discretion, amounting to lack or excess of jurisdiction, on the
part of any branch or instrumentality of the Government" (Article VIII,
Section 1, Constitution). I take it that the provision has not been
intended to unduly mutate, let alone to disregard, the long established
rules on locus standi. Neither has it been meant, I most respectfully
submit, to do away with the principle of separation of powers and its
essential incidents such as by, in effect, conferring omnipotence on, or
allowing an intrusion by, the courts in respect to purely political
decisions, the exercise of which is explicitly vested elsewhere, and
subordinate, to that of their own, the will of either the Legislative
Department or the Executive Department — both co- equal,
independent and coordinate branches, along with the Judiciary, in our
system of government. Again, if it were otherwise, there indeed would
be truth to the charge, in the words of some constitutionalists, that
"judicial tyranny" has been institutionalized by the 1987 Constitution, an
apprehension which should, I submit, rather be held far from truth and
reality.
In sum, while any act of government, be it executive in nature or
legislative in character, may be struck down and declared a nullity
either because it contravenes an express provision of the Constitution
or because it is perceived and found to be attended by or the result of
grave abuse of discretion, amounting to lack or excess of jurisdiction,
that issue, however, must first be raised in a proper judicial controversy.
The Court's authority to look into and grant relief in such cases would
necessitate locus standi on the part of party litigants. This requirement,
in my considered view, is not merely procedural or technical but goes
into the essence of jurisdiction and the competence of courts to take
cognizance of justiciable disputes.
In Bugnay Construction and Development Corporation vs. Laron, 5 this
Court ruled:
. . . . Considering the importance to the public of a
suit assailing the constitutionality of a tax law, and in
keeping with the Court's duty, specially explicated in
the 1987 Constitution, to determine whether or not
the other branches of the Government have kept
themselves within the limits of the Constitution and
the laws and that they have not abused the
discretion given to them, the Supreme Court may
brush aside technicalities of procedure and take
cognizance of the suit. (Citing Kapatiran vs. Tan,
G.R. No. 81311, June 30, 1988.)
However, for the above rule to apply, it is exigent
that the taxpayer-plaintiff sufficiently show that he
would be benefited or injured by the judgment or
entitled to the avails of the suit as a real party in
interest. (Citing Estate of George Litton vs.
Mendoza, G.R. No. 49120, June 30, 1988.) Before
he can invoke the power of judicial review, he must
specifically prove that he has sufficient interest in
preventing the illegal expenditure of money raised
by taxation (citing 11 Am. Jur. 761; Dumlao, et al.
vs. Commission on Elections, 95 SCRA 392) and
that he will sustain a direct injury as a result of the
enforcement of the questioned statute or contract.
(Citing Sanidad, et al. vs. Commission on Elections,
et al., 73 SCRA 333.) It is not sufficient that he has
merely a general interest common to all members of
the public. (Citing Ex Parte Levitt, 302 U.S. 633,
cited in 15 SCRA 497, Annotation.)
As so well pointed out by Mr. Justice Camilo D. Quiason during the
Court's deliberations, "due respect and proper regard for the rule on
locus standi would preclude the rendition of advisory opinions and other
forms of pronouncement on abstract issues, avoid an undue
interference on matters which are not justiciable in nature and spare the
Court from getting itself involved in political imbroglio."
The words of Senate President Edgardo J. Angara, carry wisdom; we
quote:
The powers of the political branches of our
government over economic policies is rather clear:
the Congress is to set in broad but definite strokes
the legal framework and structures for economic
development, while the Executive provides the
implementing details for realizing the economic ends
identified by Congress and executes the same.
xxx xxx xxx
If each economic decision made by the political
branches of government, particularly by the
executive, are fully open to re-examination by the
judicial branch, then very little, if any, reliance can
be placed by private economic actors on those
decisions. Investors would always have to factor in
possible costs arising from judicially-determined
 changes affecting their immediate business,
notwithstanding assurances by executive
authorities.
Judicial decisions are, in addition, inflexible and can
never substitute for sound decision-making at the
level of those who are assigned to execute the laws
of the land. Since judicial power cannot be exercised
unless an actual controversy is brought before the
courts for resolution, decisions cannot be properly
modified unless another appropriate controversy
arises." (Sen. Edgardo J. Angara, "The Supreme
Court in Economic Policy Making," Policy Review —
A Quarterly Journal of Policy Studies, Vol. 1, No. 1,
January-March 1994, published by the Senate
Policy Studies Group, pp. 2-3.)
A further set-back in entertaining the petition is that it unfortunately
likewise strikes at factual issues. The allegations to the effect that
irregularities have been committed in the processing and evaluation of
the bids to favor respondent PGMC; that the Malacañang Special
Review Committee did not verify warranties embodied in the contract;
that the operation of telecommunication facilities is indispensable in the
operation of the lottery system; the involvement of multi-national
corporations in the operation of the on-line "hi-tech" lottery system, and
the like, require the submission of evidence. This Court is not a trier of
facts, and it cannot, at this time, resolve the above issues. Just
recently, the Court has noted petitioners' manifestation of its petition
with the Securities and Exchange Commission "for the nullification of
the General Information Sheets of PGMC" in respect particularly to the
nationality holdings in the corporation. The doctrine of primary
jurisdiction would not justify a disregard of the jurisdiction of, nor would
it permit us to now preempt, said Commission on the matter.
Petitioners strongly assert, in an attempt to get the Court's concurrence
in accepting the petition, that since lottery is a game of chance, the
"lotto" system would itself be a "crime against morals" defined by
Articles 195-199 6 of the Revised Penal Code.
Being immoral and a criminal offense under the Revised Penal Code,
petitioners contend, any special law authorizing gambling must, by all
canons of statutory constructions, be interpreted strictly against the
grantee. Citing previous decisions of this Court, they maintain that
lottery is gambling, pure and simple, 7 and that this Court has
consistently condemned the immorality and illegality of gambling to be
a "national offense and not a minor transgression;" 8 "that it is a social
scourge which must be stamped out;" 9 and, "that it is pernicious to the
body politic and detrimental to the nation and its citizens."10
I most certainly will not renounce this Court's above concerns.
Nevertheless, the Court must recognize the limitations of its own
authority. Courts neither legislate nor ignore legal mandates. Republic
Act No. 1169, as amended, explicitly gives public respondent
PCSO the authority and power "to hold and conduct sweepstakes
races, lotteries, and other similar activities." In addition, it is authorized:
c. To undertake any other activity that will enhance
its funds generation, operations and funds
management capabilities, subject to the same
limitations provided for in the preceding paragraph.
It shall have a Board of Directors, hereinafter
designated the Board, composed of five members
who shall be appointed, and whose compensation
and term of office shall be fixed, by the President.
xxx xxx xxx
Sec.9. Powers and functions of the Board of
Directors. — The Board of Directors of the Office
shall have the following powers and functions.
(a) To adopt or amend such rules and regulations to
implement the provisions of this Act.
xxx xxx xxx
(d) To promulgate rules and regulations for the
operation of the Office and to do such act or acts as
may be necessary for the attainment of its purposes
and objectives. (Emphasis supplied).
In People vs. Dionisio, 11 cited by the petitioners themselves, we
remarked: "What evils should be corrected as pernicious to the body
politic, and how correction should be done, is a matter primarily
addressed to the discretion of the legislative department, not of the
courts . . . ." In Valmonte vs. PCSO, 12 we also said:
The Court, as held in several cases, does not pass
upon questions of wisdom, justice or expediency of
legislation and executive acts. It is not the province
of the courts to supervise legislation or executive
orders as to keep them within the bounds of
propriety, moral values and common sense. That is
primarily and even exclusively a concern of the
political departments of the government; otherwise,
there will be a violation of the principle of separation
of powers.
The constraints on judicial power are clear. I feel, the Court must thus
beg off, albeit not without reluctance, from giving due course to the
instant petition.
Accordingly, I vote for the dismissal of the petition.
KAPUNAN, J., dissenting:
I regret that I am unable to join my colleagues in the majority in spite of
my own personal distaste for gambling and other gaming operations.
Such considerations aside, I feel there are compelling reasons why the
instant petition should be dismissed. I shall forthwith state the reasons
why.
Petitioners anchor their principal objections against the contract entered
into between the Philippine Charity Sweepstakes Office (PCSO) and
the PGMC on the ground that the contract entered into by the PCSO
with the PGMC violates the PCSO Charter (R.A. No. 1169 as amended
by B.P. Blg 427, specifically section 1 thereof which bars the said body
from holding conducting lotteries "in collaboration, association or joint
venture with any person association, company or entity."). However, a
perusal of the petition reveals that the compelling reasons behind it,
while based on apparently legal questions involving the contract
between the PCSO and the PGMC, are prompted by the petitioners'
moral objections against the whole idea of gambling operations
operated by the government through the PCSO. The whole point of the
petition, in essence, is a fight between good and evil, between the
morality or amorality of lottery operations conducted on a wide scale
involving millions of individuals and affecting millions of lives. Their
media of opposition are the above stated defects in the said contract
which they assail to be fatally defective. They come to this Court, as
taxpayers and civic spirted citizens, asserting a right of standing on a
transcendental issue which they assert to be of paramount public
interest.
Moral or legal questions aside, I believe that there are unfortunately
certain standards1 that have to be followed in the exercise of this
Court's awesome power of review before this Court could even begin to
assay the validity of the contract between the PCSO and the PGMC.
This, in spite of the apparent expansion of judicial power granted by
Section 1 of Article VIII of the 1987 Constitution. It is fundamental that
such standards be complied with before this Court could even begin to
explore the substantive issues raised by any controversy brought
before it, for no issue brought before this court could possibly be so
fundamental and paramount as to warrant a relaxation of the requisite
rules for judicial review developed by settled jurisprudence inorder to
avoid entangling this court in controversies which properly belong to the
legislative or executive branches of our government. The potential harm
to our system of government, premised on the concept of separation of
powers, by the Court eager to exercise its powers and prerogatives at
every turn, cannot be gainsaid. The Constitution does not mandate this
Court to wield the power of judicial review with excessive vigor and
alacrity in every area or at every turn, except in appropriate cases and
controversies which meet established requirements for constitutional
adjudication. Article VIII Sec. 1 of the Constitution notwithstanding,
there are questions which I believe are still beyond the pale of judicial
power. Moreover, it is my considered opinion that the instant petition
does not meet the requirements set by this court for a valid exercise of
judicial review.
Our Constitution expressly defines judicial power as including "the duty
to settle actual cases and controversies involving rights which are
legally demandable and enforceable, and to determine whether or not
there has been a grave abuse of discretion amounting to a lack or
excess of jurisdiction on the part of any branch or instrumentality of the
government." 2 This constitutional requirement for an actual case and
controversy limits this Court's power of review to precisely those suits
between adversary litigants with real interests at stake2 thus preventing
it from making all sorts of hypothetical pronouncements on abstract,
contingent and amorphous issues. The Court will therefore not pass
upon the validity of an act of government or a statute passed by a
legislative body without a requisite showing of injury. 3 A personal stake
is essential, which absence renders our pronouncements gratuitous
and certainly violative of the constitutional requirement for actual cases
and controversies.
The requirement for standing based on personal injury may of course
be bypassed, as the petitioners in this case attempt to do, by
considering the case as a "taxpayer suit" which would thereby clothe
them with the personality they would lack under ordinary
circumstances. However, the act assailed by the petitioners on the
whole involves the generation rather than disbursement of public funds.
In a line of cases starting from Pascual v. Secretary of Public Works 4
"taxpayer suits" have been understood to refer only to those cases
where the act or statute assailed involves the illegal or unconstitutional
disbursement of public funds derived from taxation. The main premise
behind the "taxpayer suit" is that the pecuniary interest of the taxpayer
is involved whenever there is an illegal or wasteful use of public funds
which grants them the right to question the appropriation or
disbursement on the basis of their contribution to government funds. 5
Since it has not been alleged that an illegal appropriation or
disbursement of a fund derived from taxation would be made in the
instant case, I fail to see how the petitioners in this case would be able
to satisfy the locus standi requirement on the basis of a "taxpayer's
suit". This alone should inhibit this Court from proceeding with the case
at bench. The interest alleged and the potential injury asserted are far
too general and hypothetical for us to rush into a judicial determination
of what to me appears to be judgment better left to executive branch of
our government.
This brings me to one more important point: The idea that a norm of
constitutional adjudication could be lightly brushed aside on the mere
supposition that an issue before the Court is of paramount public
concern does great harm to a democratic system which espouses a
delicate balance between three separate but co-equal branches of
government. It is equally of paramount public concern, certainly
paramount to the survival of our democracy, that acts of the other
branches of government are accorded due respect by this Court. Such
acts, done within their sphere of competence, have been — and should
always be — accorded with a presumption of regularity. When such
acts are assailed as illegal or unconstitutional, the burden falls upon
those who assail these acts to prove that they satisfy the essential
norms of constitutional adjudication, because when we finally proceed
to declare an act of the executive or legislative branch of our
government unconstitutional or illegal, what we actually accomplish is
the thwarting of the will of the elected representatives of the people in
the executive or legislative branches government.6 Notwithstanding
Article VIII, Section 1 of the Constitution, since the exercise of the
power of judicial review by this Court is inherently antidemocratic, this
Court should exercise a becoming modesty in acting as a revisor of an
act of the executive or legislative branch. The tendency of a frequent
and easy resort to the function of judicial review, particularly in areas of
economic policy has become lamentably too common as to dwarf the
political capacity of the people expressed through their representatives
in the policy making branches of government and to deaden their sense
of moral responsibility. 7
This court has been accused, of late, of an officious tendency to delve
into areas better left to the political branches of government. 8 This
tendency, if exercised by a court running riot over the other co-equal
branches of government, poses a greater danger to our democratic
system than the perceived danger — real or imagined — of an
executive branch espousing economic or social policies of doubtful
moral worth. Moreover economic policy decisions in the current milieu-
including the act challenged in the instant case-involve complex factors
requiring flexibility and a wide range of discretion on the part of our
economic managers which this Court should respect because our
power of review, under the constitution, is a power to check, not to
supplant those acts or decisions of the elected representatives of the
people.
Finally, the instant petition was brought to this Court on the assumption
that the issue at bench raises primarily constitutional issues. As it has
ultimately turned out, the core foundation of the petitioners' objections
to the LOTTO operations was based on the validity of the contract
between the PCSO and the PGMC in the light of Section 1 of R.A. 1169
as amended by B.P. Blg. 427. It might have been much more
appropriate for the issue to have taken its normal course in the courts
below.
I vote to deny the petition.
# Separate Opinions
CRUZ, J., concurring:
I am happy to join Mr. Justice Hilario G. Davide, Jr. in his excellent
ponencia. I will add the following personal observations only for
emphasis as it is not necessary to supplement his thorough exposition.
The respondents take great pains to cite specific provisions of the
contract to show that it is PCSO that is actually operating the on-line
lottery, but they have not succeeded in disproving the obvious, to wit,
that the document was intentionally so crafted to make it appear that
the operation is not a joint undertaking of PCSO and PGMC but a mere
lease of services. It is a clever instrument, to be sure, but we are,
gratifyingly, not deluded. Lawyers have a special talent to disguise the
real intention of the parties in a contract to make it come ostensibly
within the provisions of a law although the real if furtive purpose is to
violate it. That talent has been exercised in this case, but not
convincingly enough.
It should be quite clear, from the adroit way the contract has been
drafted, that the primary objective was to avoid the conclusion that
PCSO will be operating a lottery "in association, collaboration or joint
venture with any person, association, company or entity," which is
prohibited by Section 1 of Rep. Act No. 1169 as amended by B.P. Blg.
42. Citing the self-serving provisions of the contract, the respondents
would have us believe that the contract is perfectly lawful because all it
does is provide for the lease to PCSO of the technical know-how and
equipment of PGMC, with PCSO acting as "the sole and individual
operator" of the lottery. I am glad we are not succumbing to this
sophistry.
Despite the artfulness of the contract (authorship of which was
pointedly denied by both counsel for the government and the private
respondent during the oral argument on this case), a careful study will
reveal telling stipulations that it is PGMC and not PCSO that will
actually be operating the lottery. Thus, it is provided inter alia that
PGMC shall furnish all capital equipment and other facilities needed for
the operation; bear all expenses relating to the operation, including
those for the salaries and wages of the administrative and technical
personnel; undertake a positive advertising and promotion campaign for
public support of the lottery; establish a radio communications network
throughout the country as part of the operation; and assume all risks if
the revenues from ticket sales are insufficient to pay the entire prize
money. Most significantly, to show that it is only after eight years from
the effectivity of the contract that PCSO will actually operate the lottery,
Par. 6.7 of the agreement provides that PGMC shall:
6.7. Upon effectivity of this Contract, commence the
training of PCSO and other local personnel and the
transfer of technology and expertise, such that at
the end of the term of this Contract, PCSO will be
able to effectively take-over the Facilities and
efficiently operate the On-Line Lottery System.
(Emphasis supplied).
In the meantime, that is to say during the entire 8-year term of the
contract, it will be PGMC that will be operating the lottery. Only "at the
end of the term of this Contract" will PCSO "be able to effectively take-
over the Facilities and efficiently operate the On-Line Lottery System."
Even on the assumption that it is PCSO that will be operating the lottery
at the very start, the authority granted to PGMC by the agreement will
readily show that PCSO will not be acting alone, as the respondents
pretend. In fact, it cannot. PGMC is an indispensable co-worker
because it has the equipment and the technology and the management
skills that PCSO does not have at this time for the operation of the
lottery, PCSO cannot deny that it needs the assistance of PGMC for
this purpose, which was its reason for entering into the contract in the
first place.
And when PCSO does avail itself of such assistance, how will it be
operating the lottery? Undoubtedly, it will be doing so "in collaboration,
association or joint venture" with PGMC, which, let it be added, will not
be serving as a mere "hired help" of PCSO subject to its control. PGMC
will be functioning independently in the discharge of its own assigned
role as stipulated in detail under the contract. PGMC is plainly a partner
of PCSO in violation of law, no matter how PGMC's assistance is called
or the contract is denominated.
Even if it be conceded that the assistance partakes of a lease of
services, the undeniable fact is that PCSO would still be collaborating
or cooperating with PGMC in the operation of the lottery. What is even
worse is that PCSO and PGMC may be actually engaged in a joint
venture, considering that PGMC does not collect the usual fixed rentals
due an ordinary lessor but is entitled to a special "Rental Fee," as the
contract calls it, "equal to four point nine percent (4.9%) of gross
receipts from ticket sales."
The flexibility of this amount is significant. As may be expected, it will
induce in PGMC an active interest and participation in the success of
PCSO that is not expected of an ordinary detached lessor who gets to
be paid his rentals — not a rental fee — whether the lessee's business
prospers or not. PGMC's share in the operation depends on its own
performance and the effectiveness of its collaboration with PCSO.
Although the contract pretends otherwise, PGMC is a co-investor with
PCSO in what is practically, if not in a strictly legal sense, a joint
venture.
Concerning the doctrine of locus standi, I cannot agree that out of the
sixty million Filipinos affected by the proposed lottery, not a single
solitary citizen can question the agreement. Locus standi is not such an
absolute rule that it cannot admit of exceptions under certain conditions
or circumstances like those attending this transaction. As I remarked in
my dissent in Guazon v. De Villa, 181 SCRA 623, "It is not only the
owner of the burning house who has the right to call the firemen. Every
one has the right and responsibility to prevent the fire from spreading
even if he lives in the other block."
What is especially galling is that the transaction in question would foist
upon our people an essentially immoral activity through the
instrumentality of a foreign corporation, which naturally does not have
the same concern for our interests as we ourselves have. I am
distressed that foreigners should be allowed to exploit the weakness of
some of us for instant gain without work, and with the active
collaboration and encouragement of our own government at that.
Feliciano, J., concurring
I agree with the conclusions reached by my distinguished brother in the
Court Davide, Jr., J., both in respect of the question of locus standi and
in respect of the merits of this case, that is, the issues of legality and
constitutionality of the Contract of Lease entered into between the
Philippine Charity Sweepstakes Office (PCSO) and the Philippine
Gaming Management Corporation (PGMC).
In this separate opinion, I propose to address only the question of locus
standi. It is with some hesitation that I do so, considering the extensive
separate opinions on this question written by my learned brothers Melo,
Puno and Vitug, JJ. I agree with the great deal of what my brothers
Melo, Puno and Vitug say about locus standi in their separate opinions
and there is no need to go over the ground that I share with them.
Because, however, I reach a different conclusion in respect of the
presence or absence of locus standi on the part of the petitioners in the
case before the Court, there is an internal need (a need internal to
myself) to articulate the considerations which led me to that conclusion.
There is no dispute that the doctrine of locus standi reflects an
important constitutional principle, that is, the principle of separation of
powers which, among other things, mandates that each of the great
Departments of government is responsible for performance of its
constitutionally allotted tasks. Insofar as the Judicial Department is
concerned, the exercise of judicial power and carrying out of judicial
functions commonly take place within the context of actual cases or
controversies. This, in turn, reflects the basic notion of judicial power as
the power to resolve actual disputes and of the traditional business of
courts as the hearing and deciding of specific controversies brought
before them. In our own jurisdiction, and at least since the turn of the
present century, judicial power has always included the power of
judicial review, understood as the authority of courts (more specifically
the Supreme Court) to assay contested legislative and executive acts in
terms of their constitutionality or legality. Thus, the general proposition
has been that a petitioner who assails the legal or constitutional quality
of an executive or legislative act must be able to show that he has
locus standi. Otherwise, the petition becomes vulnerable to prompt
dismissal by the court.
There is, upon the other hand, little substantive dispute that the
possession of locus standi 1 is not, in each and every case, a rigid and
absolute requirement for access to the courts. Certainly that is the case
where great issues of public law are at stake, issues which cannot be
approached in the same way that a court approaches a suit for the
collection of a sum of money or a complaint for the recovery of
possession of a particular piece of land. The broad question is when, or
in what types of cases, the court should insist on a clear showing of
locus standi understood as a direct and personal interest in the subject
matter of the case at bar, and when the court may or should relax that
apparently stringent requirement and proceed to deal with the legal or
constitutional issues at stake in a particular case.
I submit, with respect, that it is not enough for the Court simply to
invoke "public interest" or even "paramount considerations of national
interest," and to say that the specific requirements of such public
interest can only be ascertained on a "case to case" basis. For one
thing, such an approach is not intellectually satisfying. For another,
such an answer appears to come too close to saying that locus standi
exists whenever at least a majority of the Members of this Court
participating in a case feel that an appropriate case for judicial
intervention has arisen.
This is not, however, to say that there is somewhere an over-arching
juridical principle or theory, waiting to be discovered, that permits a
ready answer to the question of when, or in what types of cases, the
need to show locus standi may be relaxed in greater or lesser degree.
To my knowledge, no satisfactory principle or theory has been
discovered and none has been crafted, whether in our jurisdiction or in
the United States. 2 I have neither the competence nor the opportunity
to try to craft such principle or formula. It might, however, be useful to
attempt to indicate the considerations of principle which, in the present
case, appear to me to require an affirmative answer to the question of
whether or not petitioners are properly regarded as imbued with the
standing necessary to bring and maintain the present petition.
Firstly, the character of the funds or other assets involved in the case is
of major importance. In the case presently before the Court, the funds
involved are clearly public in nature. The funds to be generated by the
proposed lottery are to be raised from the population at large. Should
the proposed operation be as successful as its proponents project,
those funds will come from well-nigh every town and barrio of Luzon.
The funds here involved are public in another very real sense: they will
belong to the PCSO, a government owned or controlled corporation
and an instrumentality of the government and are destined for utilization
in social development projects which, at least in principle, are designed
to benefit the general public. My learned brothers Melo, Puno and
Vitug, JJ. concede that taxpayers' suits have been recognized as an
exception to the traditional requirement of recognized as an exception
to the traditional requirement of locus standi. They insist, however, that
because the funds here involved will not have been generated by the
exercise of the taxing power of the Government, the present petition
cannot be regarded as a taxpayer's suit and therefore, must be
dismissed by the Court. It is my respectful submission that that
constitutes much too narrow a conception of the taxpayer's suit and of
the public policy that it embodies. It is also to overlook the fact that tax
monies, strictly so called, constitute only one (1) of the major categories
of funds today raised and used for public purposes. It is widely known
that the principal sources of funding for government operations today
include, not just taxes and customs duties, but also revenues derived
from activities of the Philippine Amusement Gaming Corporation
(PAGCOR), as well as the proceeds of privatization of government
owned or controlled corporations and other government owned assets.
The interest of a private citizen in seeing to it that public funds, from
whatever source they may have been derived, go only to the uses
directed and permitted by law is as real and personal and substantial as
the interest of a private taxpayer in seeing to it that tax monies are not
intercepted on their way to the public treasury or otherwise diverted
from uses prescribed or allowed by law. It is also pertinent to note that
the more successful the government is in raising revenues by non-
traditional methods such as PAGCOR operations and privatization
measures, the lesser will be the pressure upon the traditional sources
of public revenues, i.e., the pocket books of individual taxpayers and
importers.
A second factor of high relevance is the presence of a clear case of
disregard of a constitutional or statutory prohibition by the public
respondent agency or instrumentality of the government. A showing
that a constitutional or legal provision is patently being disregarded by
the agency or instrumentality whose act is being assailed, can scarcely
be disregarded by court. The concept of locus standi — which is part
and parcel of the broader notion of ripeness of the case — "does not
operate independently and is not alone decisive. . . . [I]t is in substantial
part a function of a judge's estimate of the merits of the constitutional
[or legal] issue." 3 The notion of locus standi and the judge's
conclusions about the merits of the case, in other words, interact with
each other. Where the Court perceives a serious issue of violation of
some constitutional or statutory limitation, it will be much less difficult
for the Court to find locus standi in the petitioner and to confront the
legal or constitutional issue. In the present case, the majority of the
Court considers that a very substantial showing has been made that the
Contract of Lease between the PCSO and the PGMC flies in the face of
legal limitations.
A third consideration of importance in the present case is the lack of
any other party with a more direct and specific interest in raising the
questions here being raised. Though a public bidding was held, no
losing or dissatisfied bidder has come before the Court. The Office of
the Ombudsman has not, to the knowledge of the Court, raised
questions about the legality or constitutionality of the Contract of Lease
here involved. The National Government itself, through the Office of the
Solicitor General, is defending the PCSO Contract (though it had not
participated in the drafting thereof). In a situation like that here
obtaining, the submission may be made that the institution, so well
known in corporation law and practice, of the corporate stockholders'
derivative suit furnishes an appropriate analogy and that on the basis of
such an analogy, a taxpayer's derivative suit should be recognized as
available.
The wide range of impact of the Contract of Lease here assailed and of
its implementation, constitutes still another consideration of
significance. In the case at bar, the agreement if implemented will be
practically nationwide in its scope and reach (the PCSO-PGMC
Contract is limited in its application to the Island of Luzon; but if the
PCSO Contracts with the other two [2] private "gaming management"
corporations in respect of the Visayas and Mindanao are substantially
similar to PCSO's Contract with PGMC, then the Contract before us
may be said to be national indeed in its implications and
consequences). Necessarily, the amounts of money expected to be
raised by the proposed activities of the PCSO and PGMC will be very
substantial, probably in the hundreds of millions of pesos. It is not easy
to conceive of a contract with greater and more far-reaching
consequences, literally speaking, for the country than the Contract of
Lease here involved. Thus, the subject matter of the petition is not
something that the Court may casually pass over as unimportant and
as not warranting the expenditure of significant judicial resources.
In the examination of the various features of this case, the above
considerations have appeared to me to be important and as pressing
for acceptance and exercise of jurisdiction on the part of this Court. It is
with these considerations in mind that I vote to grant due course to the
Petition and to hold that the Contract of Lease between the PCSO and
PGMC in its present form and content, and given the present state of
the law, is fatally defective.
PADILLA, J., concurring:
My views against gambling are a matter of judicial record. In Basco v.
PAGCOR, (G.R. No. 91649, 14 May 1991, 197 SCRA 52) I expressed
these views in a separate opinion where I was joined by that
outstanding lady jurist, Mme. Justice A. Melencio-Herrera whose
incisive approach to legal problems is today missed in this Court. I
reproduce here those views because they are highly persuasive to the
conclusions I reach in the present controversy:
I concur in the result of the learned decision penned
by my brother Mr. Justice Paras. This means that I
agree with the decision insofar as it holds that the
prohibition, control, and regulation of the entire
activity known as gambling properly pertain to "state
policy." It is, therefore, the political departments of
government, namely, the legislative and the
 executive that should decide on what government
should do in the entire area of gambling, and
assume full responsibility to the people for such
policy.
The courts, as the decision states, cannot inquire
into the wisdom, morality or expediency of policies
adopted by the political departments of government
in areas which fall within their authority, except only
when such policies pose a clear and present danger
to the life, liberty or property of the individual. This
case does not involve such a factual situation.
However, I hasten to make of record that I do not
subscribe to gambling in any form. It demeans the
human personality, destroys self-confidence and
eviscerates one's self-respect, which in the long run
will corrode whatever is left of the Filipino moral
character. Gambling has wrecked and will continue
to wreck families and homes; it is an antithesis to
individual reliance and reliability as well as personal
industry which are the touchstones of real economic
progress and national development.
Gambling is reprehensible whether maintained by
government or privatized. The revenues realized by
the government out of "legalized" gambling will, in
the long run, be more than offset and negated by the
irreparable damage to the people's moral values.
Also, the moral standing of the government in its
repeated avowals against "illegal gambling" is fatally
flawed and becomes untenable when it itself
engages in the very activity it seeks to eradicate.
One can go through the Court's decision today and
mentally replace the activity referred to therein as
gambling, which is legal only because it is
authorized by law and run by the government, with
the activity known as prostitution. Would prostitution
be any less reprehensible were it to be authorized
by law, franchised, and "regulated" by the
government, in return for the substantial revenues it
would yield the government to carry out its laudable
projects, such as infrastructure and social
amelioration? The question, I believe, answers itself.
I submit that the sooner the legislative department
outlaws all forms of gambling, as a fundamental
state policy, and the sooner the executive
implements such policy, the better it will be for the
nation.
We presently have the sweepstakes lotteries; we already have the
PAGCOR's gambling casinos; the Filipino people will soon, if plans do
not miscarry, be initiated into an even more sophisticated and
encompassing nationwide gambling network known as the "on-line hi-
tech lotto system." To be sure, it is not wealth producing; it is not export
oriented. It will draw from existing wealth in the hands of Filipinos and
transfer it into the coffers of the PCSO and its foreign partners at a
price of further debasement of the moral standards of the Filipino
people, the bulk of whom are barely subsisting below the poverty line.
1. It is said that petitioners 1 have no locus standi to
bring this suit even as they challenge the legality
and constitutionality of a contract of lease between
the PCSO, a government-owned corporation and
the PGMC, a private corporation with substantial (if
not controlling) foreign composition and content.
Such contract of lease contains the terms and
conditions under which an "on-line hi-tech lotto
system" will operate in the country.
As the ponente of the extended, unsigned en banc resolution in
Valmonte v. PCSO, (G.R. No. 78716 and G.R. No. 79084, 22
September 1987), I would be the last to downgrade the rule, therein
reiterated, that in order to maintain a suit challenging the
constitutionality and/or legality of a statute, order or regulation or
assailing a particular governmental action as done with grave abuse of
discretion or with lack of jurisdiction, the petitioner must show that he
has a clear personal or legal right that would be violated with the
enforcement of the challenged statute, order or regulation or the
implementation of the questioned governmental action. But, in my
considered view, this rule maybe (and should be) relaxed when the
issue involved or raised in the petition is of such paramount national
interest and importance as to dwarf the above procedural rule into a
barren technicality. As a unanimous Court en banc aptly put it in De
Guia vs. COMELEC, G.R. No. 104712, 6 May 1992, 208 SCRA 420.
Before addressing the crux of the controversy, the
Court observes that petitioner does not allege that
he is running for re-election, much less, that he is
prejudiced by the election, by district, in Parañaque.
As such, he does not appear to have locus standi, a
standing in law, a personal or substantial interest.
(Sanidad vs. COMELEC, G.R. No. L-4640, October
12, 1976. 73 SCRA 333; Municipality of Malabang
vs. Benito, G.R. No. L-28113, March 28, 1969, 27
SCRA 533) He does not also allege any legal right
that has been violated by respondent. If for this
alone, petitioner does not appear to have any cause
of action.
However, considering the importance of the issue
involved, concerning as it does the political exercise
of qualified voters affected by the apportionment,
and petitioner alleging abuse of discretion and
violation of the Constitution by respondent, We
resolved to brush aside the question of procedural
infirmity, even as We perceive the petition to be one
of declaratory relief. We so held similarly through
Mr. Justice Edgardo L. Paras in Osmeña vs.
Commission on Elections.
I view the present case as falling within the De Guia case doctrine. For,
when the contract of lease in question seeks to establish and operate a
nationwide gambling network with substantial if not controlling foreign
participation, then the issue is of paramount national interest and
importance as to justify and warrant a relaxation of the above-
mentioned procedural rule on locus standi.
2. The charter of the PCSO — Republic Act No.
1169 as amended by BP No. 42 — insofar as
relevant, reads:
Sec. 1. The Philippine Charity Sweepstakes Office.
— The Philippine Charity Sweepstakes Office,
hereinafter designated the Office, shall be the
principal government agency for raising and
providing for funds for health programs, medical
assistance and services and charities of national
character, and as such shall have the general
powers conferred in section thirteen of Act
Numbered One Thousand Four Hundred Fifty-Nine,
as amended, and shall have the authority:
A. To hold and conduct charity sweepstakes races,
lotteries and other similar activities, in such
frequency and manner, as shall be determined, and
subject to such rules and regulations as shall be
promulgated by the Board of Directors.
B. Subject to the approval of the Minister of Human
Settlements, to engage in health and welfare-related
investments, programs, projects and activities which
may be profit-oriented, by itself or in collaboration,
association or joint venture with any person,
association, company or entity, whether domestic or
foreign, except for the activities mentioned in the
preceding paragraph (A), for the purpose of
providing for permanent and continuing sources of
funds for health programs, including the expansion
of existing ones, medical assistance and services,
and/or charitable grants: Provided, That such
investments will not compete with the private sector
in areas where investments are adequate as may be
determined by the National Economic and
Development Authority.
It is at once clear from the foregoing legal provisions that, while the
PCSO charter allows the PCSO to itself engage in lotteries, it does not
however permit the PCSO to undertake or engage in lotteries in
"collaboration, association or joint venture" with others. The palpable
reason for this prohibition is, that PCSO should not and cannot be
made a vehicle for an otherwise prohibited foreign or domestic entity to
engage in lotteries (gambling activities) in the Philippines.
The core question then is whether the lease contract between PCSO
and PGMC is a device whereby PCSO will engage in lottery in
collaboration, association or joint venture with another, i.e. PGMC. I
need not go here into the details and different specific features of the
contract to show that it is a joint venture between PCSO and PGMC.
That has been taken care of in the opinion of Mr. Justice Davide to
which I fully subscribe.
On a slightly different plane and, perhaps simplified, I consider the
agreement or arrangement between the PCSO and PGMC a joint
venture because each party to the contract contributes its share in the
enterprise or project. PGMC contributes its facilities, equipment and
know-how (expertise). PCSO contributes (aside from its charter) the
market, directly or through dealers — and this to me is most important
— in the totality or mass of the Filipino gambling elements who will
invest in lotto tickets. PGMC will get its 4.9% of gross receipts (with
assumption of certain risks in the course of lotto operations); the
residue of the whole exercise will go to PCSO. To any person with a
minimum of business know-how, this is a joint venture between PCSO
and PGMC, plain and simple.
But assuming ex gratia argumenti that such arrangement between
PCSO and PGMC is not a joint venture between the two of them to
install and operate an "on-line hi-tech lotto system" in the country, it can
hardly be denied that it is, at the very least, an association or
collaboration between PCSO and PGMC. For one cannot do without
the other in the installation, operation and, most importantly, marketing
of the entire enterprise or project in this country.
Indeed, the contract of lease in question is a clear violation of Republic
Act No. 1169 as amended by BP No. 42 (the PCSO charter).
Having arrived at the conclusion that the contract of lease in question
between the PCSO and PGMC is illegal and, therefore, invalid, I find it
unnecessary to dwell on the other issues raised in the pleadings and
arguments of the parties.
I, therefore, vote to give DUE COURSE to the petition and to declare
the contract of lease in question between PCSO and PGMC, for the
reasons aforestated, of no force and effect.
MELO, J., dissenting:
I submit that the petition before the Court deserves no less than outright
dismissal for the reason that petitioners, as concerned citizens and as
taxpayers and as members of Congress, do not possess the necessary
legal standing to assail the validity of the contract of lease entered into
by the Philippine Charity Sweepstakes Office and the Philippine
Gaming Management Corporation relative to the establishment and
operation of an "On-line Hi-Tech Lottery System" in the country.
As announced in Lamb vs. Phipps (22 Phil. [1912], 559), "[J]udicial
power in its nature, is the power to hear and decide causes pending
between parties who have the right to sue and be sued in the courts of
law and equity." Necessarily, this implies that a party must show a
personal stake in the outcome of the controversy or an injury to himself
that can be addressed by a favorable decision so as to warrant his
invocation of the court's jurisdiction and to justify the court's remedial
powers in his behalf (Warth vs. Seldin, 422 U.S. 490; Guzman vs.
Marrero, 180 U.S. 81; McMicken vs. United States, 97 U.S. 204). Here,
we have yet to see any of petitioners acquiring a personal stake in the
outcome of the controversy or being placed in a situation whereby
injury may be sustained if the contract of lease in question is
implemented. It may be that the contract has somehow evoked public
interest which petitioners claim to represent. But the alleged public
interest which they pretend to represent is not only broad and
encompassing but also strikingly and veritably indeterminate that one
cannot truly say whether a handful of the public, like herein petitioners,
may lay a valid claim of representation in behalf of the millions of
citizens spread all over the land who may have just as many varied
reactions relative to the contract in question.
Any effort to infuse personality on petitioners by considering the present
case as a "taxpayer's suit" could not cure the lack of locus standi on the
part of petitioners. As understood in this jurisdiction, a "taxpayer's suit"
refers to a case where the act complained of directly involves the illegal
disbursement of public funds derived from taxation (Pascual vs.
Secretary of Public Works, 110 Phil. [1960] 331; Maceda vs. Macaraig,
197 SCRA [1991]; Lozada vs. COMELEC, 120 SCRA [1983] 337;
Dumlao vs. COMELEC, 95 SCRA [1980] 392; Gonzales vs. Marcos, 65
SCRA [1975] 624). It cannot be overstressed that no public fund raised
by taxation is involved in this case. In fact, it is even doubtful if the
rentals which the PCSO will pay to the lessor for its operation of the
lottery system may be regarded as "public fund". The PCSO is not a
revenue- collecting arm of the government. Income or money realized
by it from its operations will not and need not be turned over to the
National Treasury. Rather, this will constitute corporate funds which will
remain with the corporation to finance its various activities as
authorized in its charter. And if ever some semblance of "public
character" may be said to attach to its earnings, it is simply because
PCSO is a government-owned or controlled entity and not a purely
private enterprise.
It must be conceded though that a "taxpayer's suit" had been allowed in
a number of instances in this jurisdiction. For sure, after the trial was
blazed by Pascual vs. Secretary of Public Works, supra, several more
followed. It is to be noted, however, that in those occasions where this
Court allowed such a suit, the case invariably involved either the
constitutionality of a statute or the legality of the disbursement of public
funds through the enforcement of what was perceived to be an invalid
or unconstitutional statute or legislation (Pascual, supra; Philippine
Constitution Association, Inc. vs. Jimenez, 15 SCRA [1965] 479;
Philippine Constitution Association, Inc. vs. Mathay, 18 SCRA [1966]
300; Tolentino vs. COMELEC, 41 SCRA [1971] 702; Pelaez vs. Auditor
General, 15 SCRA [1965] 569; Iloilo Palay and Corn Planters
Association vs. Feliciano, 13 SCRA [1965] 377).
The case before us is not a challenge to the validity of a statute or an
attempt to restrain expenditure of public funds pursuant to an alleged
invalid congressional enactment. What petitioners ask us to do is to
nullify a simple contract of lease entered into by a government-owned
corporation with a private entity. That contract, as earlier pointed out,
does not involve the disbursement of public funds but of strictly
corporate money. If every taxpayer, claiming to have interest in the
contract, no matter how remote, could come to this Court and seek
nullification of said contract, the day may come when the activities of
government corporate entities will ground to a standstill on account of
nuisance suits filed against them by persons whose supposed interest
in the contract is as remote and as obscure as the interest of any man
in the street. The dangers attendant thereto are not hard to discern and
this Court must not allow them to come to pass.
One final observation must be emphasized. When the petition at bench
was filed, the Court decided to hear the case on oral argument on the
initial perception that a constitutional issue could be involved. However,
it now appears that no question of constitutional dimension is at stake
as indeed the majority barely touches on such an issue, concentrating
as it does on its interpretation of the contract between the Philippine
Charity Sweepstakes Office and the Philippine Gaming Management
Corporation.
I, therefore, vote to dismiss the petition.
PUNO, J., dissenting:
At the outset, let me state that my religious faith and family upbringing
compel me to regard gambling, regardless of its garb, with hostile eyes.
Such antagonism tempts me to view the case at bench as a struggle
between good and evil, a fight between the forces of light against the
forces of darkness. I will not, however, yield to that temptation for we
are not judges of the Old Testament type who were not only arbiters of
law but were also high priests of morality.
I will therefore strictly confine the peregrinations of my mind to the legal
issues for resolution: (1) whether or not the petitioners have the Locus
standi to file the petition at bench; and (2) assuming their locus standi,
whether or not the Contract of Lease between PCSO and PGMC is null
and void considering: (a) section 1 of R.A. No. 1169, as amended by
B.P. Blg. 42 (Charter of PCSO) which prohibits PCSO from holding and
conducting lotteries "in collaboration, association or joint venture with
any person, association, company or entity"; (b) Act No. 3836 which
requires a congressional franchise before any person or entity can
establish and operate a telecommunication system; (c) section 11, Art.
XII of the Constitution, which requires that for a corporation to operate a
public utility, at least 60% of its capital must be owned by Filipino
citizens; and (d) R.A. No. 7042, otherwise known as the "Foreign
Investments Act", which includes all forms of gambling in its "negative
list."
While the legal issues abound, I deferentially submit that the threshold
issue is the locus standi, or standing to sue, of petitioners. The petition
describes petitioner Kilosbayan, Inc., as a non-stock corporation
composed of "civic spirited citizens, pastors, priests, nuns, and lay
leaders who are committed to the cause of truth, justice, and national
renewal." 1 Petitioners Jovito R. Salonga, Cirilo A. Rigos, Ernie Camba,
Emilio C. Capulong, Jr., Jose Abcede, Christine Tan, Felipe L. Gozon,
Rafael G. Fernando, Raoul V. Victorino, Jose Cunanan, and Quintin S.
Doromal joined the petition in their capacity as trustees of Kilosbayan,
Inc., and as taxpayers and concerned citizens. 2 Petitioners Freddie
Webb and Wigberto Tañada joined the petition as senators, taxpayers
and concerned citizens. 3 Petitioner Joker P. Arroyo joined the petition
as a member of the House of Representative, a taxpayer and a
concerned citizen. 4
With due respect to the majority opinion, I wish to focus on the
interstices of locus standi, a concept described by Prof. Paul Freund as
"among the most amorphous in the entire domain of public law." The
requirement of standing to sue inheres from the definition of judicial
power. It is not merely a technical rule of procedure which we are at
liberty to disregard. Section 1, Article VIII of the Constitution provides:
xxx xxx xxx
Judicial power includes the duty of the courts of
justice to settle actual controversies involving rights
which are legally demandable and enforceable, and
to determine whether or not there has been a grave
abuse of discretion amounting to lack or excess of
jurisdiction on the part of any branch or
instrumentality of the Government. (Italics supplied)
The phrase "actual controversies involving rights which are legally
demandable and enforceable" has acquired a cultivated meaning given
by courts. It spells out the requirements that must be satisfied before
one can come to court to litigate a constitutional issue. Our
distinguished colleague, Mr. Justice Isagani A. Cruz, gives a shorthand
summary of these requirements when he states that no constitutional
question will be heard and decided by courts unless there is a showing
of the following: . . . (1) there must be an actual case or controversy; (2)
the question of constitutionality must be raised by the proper party; (3)
the constitutional question must be raised at the earliest possible
opportunity; and (4) the decision of the constitutional question must be
necessary to the determination of the case itself. 5
The complexion of the rule on locus standi has been undergoing a
change. Mr. Justice Cruz has observed the continuing relaxation of the
rule on
standing, 6 thus:
xxx xxx xxx
A proper party is one who has sustained or is in
immediate danger of sustaining an injury as a result
of the act complained of. Until and unless such
actual or potential injury is established, the
complainant cannot have the legal personality to
raise the constitutional question.
In Tileson v. Ullmann, a physician questioned the
constitutionality of a law prohibiting the use of
contraceptives, upon the ground that it might prove
dangerous to the life or health of some of his
patients whose physical condition would not enable
them to bear the rigors of childbirth. The court
dismissed the challenge, holding that the patients of
the physician and not the physician himself were the
proper parties.
In Cuyegkeng v. Cruz, the petitioner challenged in a
quo warranto proceeding the title of the respondent
who, he claimed, had been appointed to the board
of medical examiners in violation of the provisions of
the Medical Act of 1959. The Supreme Court
dismissed the petition, holding that Cuyegkeng had
not made a claim to the position held by Cruz and
therefore could not be regarded as a proper party
who had sustained an injury as a result of the
questioned act.
In People v. Vera, it was held that the Government
of the Philippines was a proper party to challenge
the constitutionality of the Probation Act because,
more than any other, it was the government itself
that should be concerned over the validity of its own
laws.
In Ex Parte Levitt, the petitioner, an American
taxpayer and member of the bar, filed a motion for
leave to question the qualifications of Justice Black
who, he averred, had been appointed to the U.S.
Supreme Court in violation of the Constitution of the
United States. The Court dismissed the petition,
holding that Levitt was not a proper party since he
was not claiming the position held by Justice Black.
The rule before was that an ordinary taxpayer did
not have the proper party personality to question the
legality of an appropriation law since his interest in
the sum appropriated was not substantial enough.
Thus, in Custodio v. Senate President, a challenge
by an ordinary taxpayer to the validity of a law
granting back pay to government officials, including
members of Congress, during the period
corresponding to the Japanese Occupation was
dismissed as having been commenced by one who
was not a proper party.
Since the first Emergency Powers Cases, however,
the rule has been changed and it is now permissible
for an ordinary taxpayer, or a group of taxpayers, to
raise the question of the validity of an appropriation
law. As the Supreme Court then put it. "The
transcendental importance to the public of these
cases demands that they be settled promptly and
definitely, brushing aside, if we must, technicalities
of procedure."
In Tolentino v. Commission on Elections, it was held
that a senator had the proper party personality to
seek the prohibition of a plebiscite for the ratification
of a proposed constitutional amendment. In
PHILCONSA v. Jimenez, an organization of
taxpayers and citizens was held to be a proper party
to question the constitutionality of a law providing for
special retirement benefits for members of the
legislature.
In Sanidad v. Commission on Elections, the
Supreme Court upheld the petitioners as proper
parties, thus —
As a preliminary resolution, We
rule that the petitioners in L-
44640 (Pablo C. Sanidad and
Pablito V. Sanidad) possess
locus standi to challenge the
constitutional premise of
Presidential Decree Nos. 991,
1031, and 1033. It is now an
ancient rule that the valid source
of a statute — Presidential
Decrees are of such nature —
may be contested by one who
will sustain a direct injury as a
result of its enforcement. At the
instance of taxpayers, laws
providing for the disbursement of
public funds may be enjoined,
upon the theory that the
expenditure of public funds by an
officer of the State for the
purpose of executing an
unconstitutional act constitutes a
misapplication of such funds.
The breadth of Presidential
Decree No. 991 carries an
appropriation of Five Million
Pesos for the effective
implementation of its purposes.
Presidential Decree No. 1031
appropriates the sum of Eight
Million Pesos to carry out its
provisions. The interest of the
aforenamed petitioners as
taxpayers in the lawful
expenditure of these amounts of
public money sufficiently clothes
them with that personality to
litigate the validity of the Decrees
appropriating said funds.
Moreover, as regard taxpayer's
suits, this Court enjoys that open
discretion to entertain the same
or not. For the present case, We
deem it sound to exercise that
discretion affirmatively so that
the authority upon which the
disputed Decrees are predicated
may be inquired into.
In Lozada v. Commission on Elections, however, the
petitioners were held without legal standing to
demand the filling of vacancies in the legislature
because they had only "a generalized interest'
shared with the rest of the citizenry."
Last July 30, 1993, we further relaxed the rule on standing in Oposa, et
al. v. Hon. Fulgencio S. Factoran, Jr., 7 where we recognized the locus
standi of minors representing themselves as well as generations
unborn to protect their constitutional right to a balanced and healthful
ecology.
I am perfectly at peace with the drift of our decisions liberalizing the rule
on locus standi. The once stubborn disinclination to decide
constitutional issues due to lack of locus standi is incompatible with the
expansion of judicial power mandated in section 1 of Article VIII of the
Constitution, i.e., "to determine whether or not there has been a grave
abuse of discretion, amounting to lack or excess of jurisdiction on the
part of any branch or instrumentality of the government." As we held
thru the ground breaking ponencia of Mr. Justice Cruz in Daza v.
Singson, 8 this provision no longer precludes the Court from resolving
political questions in proper cases. But even perusing this provision as
a constitutional warrant for the court to enter the once forbidden political
thicket, it is clear that the requirement of locus standi has not been
jettisoned by the Constitution for it still commands courts in no
uncertain terms to settle only "actual controversies involving rights
which are legally demandable and enforceable." Stated otherwise,
courts are neither free to decide all kinds of cases dumped into their
laps nor are they free to open their doors to all parties or entities
claiming a grievance. The rationale for this constitutional requirement of
locus standi is by no means trifle. It is intended "to assure a vigorous
adversary presentation of the case, and, perhaps more importantly to
warrant the judiciary's overruling the determination of a coordinate,
democratically elected organ of government." 9 It thus goes to the very
essence of representative democracies. As Mr. Justice Powell carefully
explained in U.S. v.
Richardson, 10 viz:
Relaxation of standing requirements is directly
related to the expansion of judicial power. It seems
to me inescapable that allowing unrestricted
taxpayer or citizen standing would significantly alter
the allocation of power at the national level, with a
shift away from a democratic form of government. I
also believe that repeated and essentially head-on
confrontations between the life-tenured branch and
the representative branches of government will not,
in the long run, be beneficial to either. The public
confidence essential to the former and the vitality
critical to the latter may well erode if we do not
exercise self- restraint in the utilization of our power
to negative the actions of the other branches. We
should be ever mindful of the contradictions that
would arise if a democracy were to permit at large
oversight of the elected branches of government by
a non-representative, and in large measure
insulated, judicial branch. Moreover, the argument
that the Court should allow unrestricted taxpayer or
 citizen standing underestimates the ability of the
representative branches of the Federal Government
to respond to the citizen pressure that has been
responsible in large measure for the current drift
toward expanded standing. Indeed, taxpayer or
citizen advocacy, given its potentially broad base, is
precisely the type of leverage that in a democracy
ought to be employed against the branches that
were intended to be responsive to public attitudes
about the appropriate operation of government. "We
must as judges recall that, as Mr. Justice Holmes
wisely observed, the other branches of Government
are ultimate guardians of the liberties and welfare of
the people in quite as great a degree as the courts."
Unrestrained standing in federal taxpayer or citizen
suits would create a remarkably illogical system of
judicial supervision of the coordinate branches of the
Federal Government. Randolph's proposed Council
of Revision, which was repeatedly rejected by the
Framers, at least had the virtue of being systematic;
every law passed by the legislature automatically
would have been previewed by the judiciary before
the law could take effect. On the other hand, since
the judiciary cannot select the taxpayers or citizens
who bring suit or the nature of the suits, the
allowance of public actions would produce uneven
and sporadic review, the quality of which would be
influenced by the resources and skill of the particular
plaintiff. And issues would be presented in abstract
form, contrary to the Court's recognition that "judicial
review is effective largely because it is not available
simply at the behest of a partisan faction, but is
exercised only to remedy a particular, concrete
injury." Sierra Club v. Morton, 405 U.S. 727, 740-
741, n. 16 (1972).
A lesser but not insignificant reason for screening the standing of
persons who desire to litigate constitutional issues is economic in
character. Given the sparseness of our resources, the capacity of
courts to render efficient judicial service to our people is severely
limited. For courts to indiscriminately open their doors to all types of
suits and suitors is for them to unduly overburden their dockets, and
ultimately render themselves ineffective dispensers of justice. To be
sure, this is an evil that clearly confronts our judiciary today.
Prescinding from these premises, and with great reluctance, I am not
prepared to concede the standing to sue of petitioners. On a personal
level, they have not shown that elemental injury in fact which will endow
them with a standing to sue. It must be stressed that petitioners are in
the main, seeking the nullity not of a law but of a Contract of Lease. Not
one of the petitioners is a party to the Contract of Lease executed
between PCSO and PGMC. None of the petitioners participated in the
bidding, and hence they are not losing bidders. They are complete
strangers to the contract. They stand neither to gain nor to lose
economically by its enforcement. It seems to me unusual that an
unaffected third party to a contract could be allowed to question its
validity. Petitioner Kilosbayan cannot justify this officious interference
on the ground of its commitment to "truth, justice and national renewal."
Such commitment to truth, justice and national renewal, however noble
it may be, cannot give Kilosbayan a roving commission to check the
validity of contracts entered into by the government and its agencies.
Kilosbayan is not a private commission on audit.
Neither can I perceive how the other petitioners can be personally
injured by the Contract of Lease between PCSO and PGMC even if
petitioner Salonga assails as unmitigated fraud the statistical probability
of winning the lotto as he compared it to the probability of being struck
twice by lightning. The reason is obvious: none of the petitioners will be
exposed to this alleged fraud for all of them profess to abjure playing
the lotto. It is self-evident that lotto cannot physically or spiritually injure
him who does not indulge in it.
Petitioners also contend they have locus standi as taxpayers. But the
case at bench does not involve any expenditure of public money on the
part of PCSO. In fact, paragraph 2 of the Contract of Lease provides
that it is PGMC that shall build, furnish, and maintain at its own
expense and risk the facilities for the On-Line Lottery System of PCSO
and shall bear all maintenance and other costs. Thus, PGMC alleged it
has already spent P245M in equipment and fixtures and would be
investing close to P1 billion to supply adequately the technology and
other requirements of PCSO. 11 If no tax money is being illegally
deflected in the Contract of Lease between PCSO and PGMC,
petitioners have no standing to impugn its validity as taxpayers. Our
ruling in Dumlao v. Comelec, 12 settled this issue well enough, viz:
However, the statutory provisions questioned in this
case, namely, sec. 7, BP Blg. 51, and sections 4, 1,
and 5 BP Blg. 52, do not directly involve the
disbursement of public funds. While, concededly,
the elections to be held involve the expenditure of
public moneys, nowhere in their Petition do said
petitioners allege that their tax money is "being
extracted and spent in violation of specific
constitutional protections against abuses of
legislative power" (Flast v. Cohen, 392 U.S. 83
[1960]), or that there is a misapplication of such
funds by respondent COMELEC (see Pascual vs.
Secretary of Public Works, 110 Phil. 331 [1960]), or
that public money is being deflected to any improper
purpose. Neither do petitioners seek to restrain
respondent from wasting public funds through the
enforcement of an invalid or unconstitutional law.
(Philippine Constitution Association vs. Mathay, 18
SCRA 300 [1966]), citing Philippine Constitution
Association vs. Gimenez, 15 SCRA 479 [1965]).
Besides, the institution of a taxpayer's suit, per se, is
no assurance of judicial review. As held by this
Court in Yan vs. Macapagal (43 SCRA 677 [1972]),
speaking through our present Chief Justice, this
Court is vested with discretion as to whether or not a
taxpayer's suit should be entertained.
Next, petitioners plead their standing as "concerned citizens." As
citizens, petitioners are pleading that they be allowed to advocate the
constitutional rights of other persons who are not before the court and
whose protection is allegedly their concern. A citizen qua citizen suit
urges a greater relaxation of the rule on locus standi. I feel no aversion
to the further relaxation of the rule on standing to accommodate what in
other jurisdictions is known as an assertion of jus tertii in constitutional
litigation provided the claimant can demonstrate: (1) an injury in fact to
himself, and (2) the need to prevent the erosion of a preferred
constitutional right of a third person. As stressed before, the first
requirement of injury in fact cannot be abandoned for it is an essential
element for the exercise of judicial power. Again, as stressed by Mr.
Justice Powell, viz: 13
The revolution in standing doctrine that has
occurred, particularly in the 12 years since Baker v.
Carr, supra, has not meant, however, that standing
barriers have disappeared altogether. As the Court
noted in Sierra Club, "broadening the categories of
injury that may be alleged in support of standing is a
different matter from abandoning the requirement
that the party seeking review must himself have
suffered an injury." 405 U.S., at 738 . . . Indeed,
despite the diminution of standing requirements in
the last decade, the Court has not broken with the
traditional requirement that, in the absence of a
specific statutory grant of the right of review, a
plaintiff must allege some particularized injury that
sets him apart from the man on the street.
I recognize that the Court's allegiance to a
requirement of particularized injury has on occasion
required a reading of the concept that threatens to
transform it beyond recognition. E.G., Baker v. Carr,
supra; Flast v. Cohen, supra. But despite such
occasional digressions, the requirement remains,
and I think it does so for the reasons outlined above.
In recognition of those considerations, we should
refuse to go the last mile towards abolition of
standing requirements that is implicit in broadening
the "precarious opening" for federal taxpayers
created by Flast, see 392 U.S., at 116 (Mr. Justice
Fortas, concurring) or in allowing a citizen qua
citizen to invoke the power of the federal courts to
negative unconstitutional acts of the Federal
Government.
In sum, I believe we should limit the expansion of
federal taxpayer and citizen standing in the absence
of specific statutory authorization to an outer
boundary drawn by the results in Flast and Baker v.
Carr. I think we should face up to the fact that all
such suits are an effort "to employ a federal court as
a forum in which to air . . . generalized grievances
about the conduct of government or the allocation of
power in the Federal System." Flast v. Cohen, 392
U.S., at 106. The Court should explicitly reaffirm
traditional prudential barriers against such public
actions. My reasons for this view are rooted in
respect for democratic processes and in the
conviction that "[t]he powers of the federal judiciary
will be adequate for the great burdens placed upon
them only if they are employed prudently, with
recognition of the strengths as well as the hazards
that go with our kind of representative government."
Id., at 131
The second requirement recognizes society's right in the protection of
certain preferred rights in the Constitution even when the rightholders
are not before the court. The theory is that their dilution has a
substantial fall out detriment to the rights of others, hence the latter can
vindicate them.
In the case at bench, it is difficult to see how petitioners can satisfy
these two requirements to maintain a jus tertii claim. They claim
violation of two constitutional provisions, to wit:
Section 1, Article XIII. — The Congress shall give
highest priority to the enactment of measures that
protect and enhance the right of all the people to
human dignity, reduce social, economic, and
political inequalities, and remove cultural inequities
by equitably diffusing wealth and political power for
the common good.
To this end, the State shall regulate the acquisition,
ownership, use, and disposition of property and its
increments.
and
Section 11, Article XII. - No franchise, certificate, or
any other form of authorization for the operation of a
public utility shall be granted except to citizens of the
Philippines or to corporations or associations
organized under the laws of the Philippines at least
sixty per centum of whose capital is owned by such
citizens, nor shall such franchise, certificate, or
authorizations be exclusive in character or for a
longer period than fifty years. Neither shall any such
franchise or right be granted except under the
condition that it shall be subject to amendment,
alteration, or repeal by the Congress when the
common good so requires. The State shall
encourage equity participation in public utilities by
the general public. The participation of foreign
investors in the governing body of any public utility
enterprise shall be limited to their proportionate
share in its capital, and all the executive and
managing officers of such corporation or association
must be citizen of the Philippines.
Section 1, Article XIII of the Constitution cannot be the matrix of
petitioners' jus tertii claim for it expresses no more than a policy
direction to the legislative in the discharge of its ordained duty — to
give highest priority to the enactment of measures that protect and
enhance the right of all the people to human dignity, reduce social,
economic, and political inequalities and remove cultural inequities by
equitably diffusing wealth and political power for the common good.
Whether the act of the legislature in amending the charter of PCSO by
giving it the authority to conduct lotto and whether the Contract of
Lease entered into between PCSO and PGMC are incongruent to the
policy direction of this constitutional provision is a highly debatable
proposition and can be endlessly argued. Respondents steadfastly
insist that the operation of lotto will increase the revenue base of PCSO
and enable government to provide a wider range of social services to
the people. They also allege that the operation of high-tech lotto will
eradicate illegal jueteng. Petitioners are scandalized by this
submission. They dismiss gambling as evil per se and castigate
government for attempting to correct a wrong by committing another
wrong. In any event, the proper forum for this debate, however
cerebrally exciting it may be, is not this court but congress. So we held
in PCSO v. Inopiquez, to wit: 14
By bringing their suit in the lower court, the private
respondents in G.R. No. 79084 do not question the
power of PCSO to conduct the Instant Sweepstakes
game. Rather, they assail the wisdom of embarking
upon this project because of their fear of the
"pernicious repercussions" which may be brought
about by the Instant Sweepstakes Game which they
have labelled as "the worst form of gambling" which
thus "affects the moral values" of the people.
The Court, as held in several cases, does not pass
upon questions of wisdom, justice, or expediency of
legislation and executive acts. It is not the province
of the courts to supervise legislation or executive
orders as to keep them within the bounds of
propriety, moral values and common sense. That is
primarily and even exclusively a concern of the
political departments of the government; otherwise,
there will be a violation of the principle of separation
of powers. (Italics supplied)
I am not also convinced that petitioners can justify their locus standi to
advocate the rights of hypothetical third parties not before the court by
invoking the need to keep inviolate section 11, Article XII of the
Constitution which imposes a nationality requirement on operators of a
public utility. For even assuming arguendo that PGMC is a public utility,
still, the records do not at the moment bear out the claim of petitioners
that PGMC is a foreign owned and controlled corporation. This factual
issue remains unsettled and is still the subject of litigation by the parties
in the Securities and Exchange Commission. We are not at liberty to
anticipate the verdict on this contested factual issue. But over and
above this consideration, I respectfully submit that this constitutional
provision does not confer on third parties any right of a preferred status
comparable to the Bill of Rights whose dilution will justify petitioners to
vindicate them in behalf of its rightholders. The legal right of
hypothetical third parties they profess to advocate is to my mind too
impersonal, too unsubstantial, too indirect, too amorphous to justify
their access to this Court and the further lowering of the constitutional
barrier of locus standi.
Again, with regret, I do not agree that the distinguished status of some
of the petitioners as lawmakers gives them the appropriate locus standi.
I cannot perceive how their constitutional rights and prerogatives as
legislators can be adversely affected by the contract in question. Their
right to enact laws for the general conduct of our society remains
unimpaired and undiminished. 15 Their status as legislators,
notwithstanding, they have to demonstrate that the said contract has
caused them to suffer a personal, direct, and substantial injury in fact.
They cannot simply advance a generic grievance in common with the
people in general.
I am not unaware of our ruling in De Guia v. Comelec, 16 viz:
Before addressing the crux of the controversy, the
Court observes that petitioner does not allege that
he is running for reelection, much less, that he is
prejudiced by the election, by district, in Parañaque.
As such, he does not appear to have locus standi, a
standing in law, a personal or substantial interest.
(Sanidad vs. COMELEC, G.R. No. L-44640, October
12, 1976, 73 SCRA 333; Municipality of Malabang
vs. Benito, G.R. No. L-28113, March 28, 1969, 27
SCRA 533). He does not also allege any legal right
that has been violated by respondent. If for this
alone, petitioner does not appear to have any cause
of action.
However, considering the importance of the issue
involved, concerning as it does the political exercise
of qualified voters affected by the apportionment,
and petitioner alleging abuse of discretion and
violation of the Constitution by respondent, We
resolved to brush aside the question of procedural
infirmity, even as We perceive the petition to be one
of declaratory relief. We so held similarly through
Mr. Justice Edgardo L. Paras in Osmena vs.
Commission on Elections.
It is my respectful submission, however, that we should re-examine de
Guia. It treated the rule on locus standi as a mere procedural rule. It is
not a plain procedural rule but a constitutional requirement derived from
section 1, Article VIII of the Constitution which mandates courts of
justice to settle only "actual controversies involving rights which are
legally demandable and enforceable." The phrase has been construed
since time immemorial to mean that a party in a constitutional litigation
must demonstrate a standing to sue. By downgrading the requirement
on locus standi as a procedural rule which can be discarded in the
name of public interest, we are in effect amending the Constitution by
judicial fiat.
De Guia would also brush aside the rule on locus standi if a case raises
an important issue. In this regard, I join the learned observation of Mr.
Justice Feliciano: "that it is not enough for the Court simply to invoke
'public interest' or even 'paramount considerations of national interest,'
and to say that the specific requirements of such public interest can
only be ascertained on a 'case to case' basis. For one thing, such an
approach is not intellectually satisfying. For another, such an answer
appears to come too close to saying that locus standi exists whenever
at least a majority of the Members of this Court participating in a case
feel that an appropriate case for judicial intervention has arisen."
I also submit that de Guia failed to perceive that the rule on locus
standi has little to do with the issue posed in a case, however,
important it may be. As well pointed out in Flast v. Cohen: 17
The fundamental aspect of standing is that it
focuses on the party seeking to get his complaint
before a federal court and not on the issues he
wishes to have adjudicated. The "gist of the
question of standing" is whether the party seeking
relief has "alleged such a personal stake in the
outcome of the controversy as to assure that
concrete adverseness which sharpens the
presentation of issues upon which the court so
largely depends for illumination of difficult
constitutional questions." Baker v. Carr, 369 U.S.
186, 204 (1962). In other words, when standing is
placed in issue in a case, the question is whether
the person whose standing is challenged is a proper
party to request an adjudication of a particular issue
and not whether the issue itself is justiciable. Thus,
a party may have standing in a particular case, but
the federal court may nevertheless decline to pass
 on the merits of the case because, for example, it
presents a political question. A proper party is
demanded so that federal courts will not be asked to
decide "ill-defined controversies over constitutional
issues," United public Workers v. Mitchell, 330 U.S.
75, 90 (1947), or a case which is of "a hypothetical
or abstract character," Aetna Life Insurance Co. v.
Haworth, 300 U.S. 227, 240 (1937).
It is plain to see that in de Guia, the court took an unorthodox posture,
to say the least. It held there was no proper party before it, and yet it
resolved the issues posed by the petition. As there was no proper party
before the court, its decision is vulnerable to be criticized as an
advisory opinion.
With due respect, the majority decision appears to have set a
dangerous precedent by unduly trivializing the rule on locus standi. By
its decision, the majority has entertained a public action to annul a
private contract. In so doing, the majority may have given sixty (60)
million Filipinos the standing to assail contracts of government and its
agencies. This is an invitation for chaos to visit our law on contract, and
certainly will not sit well with prospective foreign investors. Indeed, it is
difficult to tread the path of the majority on this significant issue. The
majority granted locus standi to petitioners because of lack of any other
party with more direct and specific interest. But one has standing
because he has standing on his own and standing cannot be acquired
because others with standing have refused to come to court. The thesis
is also floated that petitioners have standing as they can be considered
taxpayers with right to file derivative suit like a stockholder's derivative
suit in private corporations. The fact, however, is that PCSO is not a
private but a quasi-public corporation. Our law on private corporation
categorically sanctions stockholder's derivative suit. In contrast, our law
on public corporation does not recognize this so-called taxpayer's
derivative suit. Hence, the idea of a taxpayer's derivative suit, while
alluring, has no legal warrant.
Our brethren in the majority have also taken the unprecedented step of
striking down a contrast at the importunings of strangers thereto, but
without justifying the interposition of judicial power on any felt need to
prevent violation of an important constitutional provision. The contract
in question was voided on the sole ground that it violated an ordinary
statute, section 1 of R.A. 1169, as amended by B.P. Blg. 42. If there is
no provision of the Constitution that is involved in the case at bench, it
boggles the mind how the majority can invoke considerations of
national interest to justify its abandonment of the rule on locus standi.
The volume of noise created by the case cannot magically convert it to
a case of paramount national importance. By its ruling, the majority has
pushed the Court in unchartered water bereft of any compass, and it
may have foisted the false hope that it is the repository of all remedies.
If I pay an unwavering reverence to the rule of locus standi, it is
because I consider it as a touchstone in maintaining the proper balance
of power among the three branches of our government. The survival of
our democracy rests in a large measure on our ability to maintain this
delicate equipoise of powers. For this reason, I look at judicial review
from a distinct prism. I see it both as a power and a duty. It is a power
because it enables the judiciary to check excesses of the Executive and
the Legislative. But, it is also a duty because its requirement of locus
standi, among others, Executive and the Legislative. But, it is also a
duty because its requirement of locus standi, among others, keeps the
judiciary from overreaching the powers of the other branches of
government. By balancing this duality, we are able to breathe life to the
principle of separation of powers and prevent tyranny. To be sure, it is
our eternal concern to prevent tyranny but that includes tyranny by
ourselves. The Constitution did not install a government by the
judiciary, nay, not a government by the unelected. In offering this
submission, I reject the sublimal fear that an unyielding insistence on
the rule on locus standi will weaken the judiciary vis-a-vis the other
branches of government. The hindsight of history ought to tell us that it
is not power per se that strengthens. Power unused is preferable than
power misused. We contribute to constitutionalism both by the use of
our power to decide and its non use. As well said, the cases we decide
are as significant as the cases we do not decide. Real power belongs to
him who has power over power.
IN VIEW WHEREOF, and strictly on the ground of lack of locus standi
on the part of petitioners, I vote to DENY the petition.
VITUG, J., dissenting:
Judicial power encompasses both an authority and duty to resolve
"actual controversies involving rights which are legally demandable and
enforceable" (Article VIII, Section 1, 1987 Constitution). As early as the
case of Lamb vs. Phipps, 1 this Court ruled: "Judicial power, in its
nature, is the power to hear and decide causes pending between
parties who have the right to sue in the courts of law and equity." 2 An
essential part of, and corollary to, this principle is the locus standi of a
party litigant, referring to one who is directly affected by, and whose
interest is immediate and substantial in, the controversy. The rule
requires that a party must show a personal stake in the outcome of the
case or an injury to himself that can be redressed by a favorable
decision so as to warrant his invocation of the court's jurisdiction and to
justify the exercise of the court's remedial powers in his behalf. 3 If it
were otherwise, the exercise of that power can easily become too
unwieldy by its sheer magnitude and scope to a point that may, in no
small degree, adversely affect its intended essentiality, stability and
consequentiality.
Locus standi, nevertheless, admits of the so-called "taxpayer's suit."
Taxpayer's suits are actions or proceedings initiated by one or more
taxpayers in their own behalf or, conjunctively, in representation of
others similarly situated for the purpose of declaring illegal or
unauthorized certain acts of public officials which are claimed to be
injurious to their common interests as such taxpayers (Cf. 71 Am Jur
2d., 179-180). The principle is predicated upon the theory that
taxpayers are, in equity, the cestui que trust of tax funds, and any illegal
diminution thereof by public officials constitutes a breach of trust even
as it may result in an increased burden on taxpayers (Haddock vs.
Board of Public Education, 86 A 2d 157; Henderson vs. McCormick, 17
ALR 2d 470).
Justice Brandeis of the United States Supreme Court, in his concurring
opinion in Ashwander vs. Tennessee Valley Authority (297 U.S. 288),
said:
. . . . The Court will not pass upon the validity of a
statute upon complaint of one who fails to show that
he is injured by its operation. Tyler v. The Judges,
179 U.S. 405; Hendrick v. Maryland, 234 U.S. 610,
621. Among the many applications of this rule, none
is more striking than the denial of the right of
challenge to one who lacks a personal or property
right. Thus, the challenge by a public official
interested only in the performance of his official duty
will not be entertained. Columbus & Greenville Ry.
v. Miller, 283 U.S. 96, 99-100. In Fairchild v.
Hughes, 258 U.S. 126, the Court affirmed the
dismissal of a suit brought by a citizen who sought
to have the Nineteenth Amendment declared
unconstitutional. In Massachusetts v. Mellon, 262
U.S. 447, the challenge of the federal Maternity Act
was not entertained although made by the
Commonwealth on behalf of all its citizens."
Justice Brandeis' view, shared by Justice Frankfurter in Joint Anti-
Fascist Refugee Commission vs. McGrath (351 U.S. 123), was adopted
by the U.S. Supreme Court in Flast vs. Cohen (392 U.S. 83) which held
that it is only when a litigant is able to show such a personal stake in
the controversy as to assure a concrete adverseness in the issues
submitted that legal standing can attach.
A "taxpayer's suit," enough to confer locus standi to a party, we have
held before, is understood to be a case where the act complained of
directly involves the illegal disbursement of public funds derived from
taxation.4 It is not enough that the dispute concerns public funds. A
contrary rule could easily lead to a limitless application of the term
"taxpayer's suit," already by itself a broad concept, since a questioned
act of government would almost so invariably entail, as a practical
matter, a financial burden of some kind.
To be sure, serious doubts have even been raised on the propriety and
feasibility of unqualifiedly recognizing the "taxpayer's suit" as an
exception from the standard rule of requiring a party who invokes the
exercise of judicial power to have a real and personal interest or a
direct injury in the outcome of a controversy. This Court has heretofore
spoken on the matter, at times even venturing beyond the usual
understanding of its applicability in the name of national or public
interest. It is remarkable, nevertheless, that the accepted connotation of
locus standi has still managed to be the rule, sanctioning, by way of
exception, the so-called "taxpayer's suit" which courts accept on valid
and compelling reasons.
A provision which has been introduced by the 1987 Constitution is a
definition, for the first time in our fundamental law, of the term "judicial
power," as such authority and duty of courts of justice "to settle actual
controversies involving rights which are legally demandable and
enforceable and to determine whether or not there has been a grave
abuse of discretion, amounting to lack or excess of jurisdiction, on the
part of any branch or instrumentality of the Government" (Article VIII,
Section 1, Constitution). I take it that the provision has not been
intended to unduly mutate, let alone to disregard, the long established
rules on locus standi. Neither has it been meant, I most respectfully
submit, to do away with the principle of separation of powers and its
essential incidents such as by, in effect, conferring omnipotence on, or
allowing an intrusion by, the courts in respect to purely political
decisions, the exercise of which is explicitly vested elsewhere, and
subordinate, to that of their own, the will of either the Legislative
Department or the Executive Department — both co- equal,
independent and coordinate branches, along with the Judiciary, in our
system of government. Again, if it were otherwise, there indeed would
be truth to the charge, in the words of some constitutionalists, that
"judicial tyranny" has been institutionalized by the 1987 Constitution, an
apprehension which should, I submit, rather be held far from truth and
reality.
In sum, while any act of government, be it executive in nature or
legislative in character, may be struck down and declared a nullity
either because it contravenes an express provision of the Constitution
or because it is perceived and found to be attended by or the result of
grave abuse of discretion, amounting to lack or excess of jurisdiction,
that issue, however, must first be raised in a proper judicial controversy.
The Court's authority to look into and grant relief in such cases would
necessitate locus standi on the part of party litigants. This requirement,
in my considered view, is not merely procedural or technical but goes
into the essence of jurisdiction and the competence of courts to take
cognizance of justiciable disputes.
In Bugnay Construction and Development Corporation vs. Laron, 5 this
Court ruled:
. . . . Considering the importance to the public of a
suit assailing the constitutionality of a tax law, and in
keeping with the Court's duty, specially explicated in
the 1987 Constitution, to determine whether or not
the other branches of the Government have kept
themselves within the limits of the Constitution and
the laws and that they have not abused the
discretion given to them, the Supreme Court may
brush aside technicalities of procedure and take
cognizance of the suit. (Citing Kapatiran vs. Tan,
G.R. No. 81311, June 30, 1988.)
However, for the above rule to apply, it is exigent
that the taxpayer-plaintiff sufficiently show that he
would be benefited or injured by the judgment or
entitled to the avails of the suit as a real party in
interest. (Citing Estate of George Litton vs.
Mendoza, G.R. No. 49120, June 30, 1988.) Before
he can invoke the power of judicial review, he must
specifically prove that he has sufficient interest in
preventing the illegal expenditure of money raised
by taxation (citing 11 Am. Jur. 761; Dumlao, et al.
vs. Commission on Elections, 95 SCRA 392) and
that he will sustain a direct injury as a result of the
enforcement of the questioned statute or contract.
(Citing Sanidad, et al. vs. Commission on Elections,
et al., 73 SCRA 333.) It is not sufficient that he has
merely a general interest common to all members of
the public. (Citing Ex Parte Levitt, 302 U.S. 633,
cited in 15 SCRA 497, Annotation.)
As so well pointed out by Mr. Justice Camilo D. Quiason during the
Court's deliberations, "due respect and proper regard for the rule on
locus standi would preclude the rendition of advisory opinions and other
forms of pronouncement on abstract issues, avoid an undue
interference on matters which are not justiciable in nature and spare the
Court from getting itself involved in political imbroglio."
The words of Senate President Edgardo J. Angara, carry wisdom; we
quote:
The powers of the political branches of our
government over economic policies is rather clear:
the Congress is to set in broad but definite strokes
the legal framework and structures for economic
development, while the Executive provides the
implementing details for realizing the economic ends
identified by Congress and executes the same.
xxx xxx xxx
If each economic decision made by the political
branches of government, particularly by the
executive, are fully open to re-examination by the
judicial branch, then very little, if any, reliance can
be placed by private economic actors on those
decisions. Investors would always have to factor in
possible costs arising from judicially-determined
changes affecting their immediate business,
notwithstanding assurances by executive
authorities.
Judicial decisions are, in addition, inflexible and can
never substitute for sound decision-making at the
level of those who are assigned to execute the laws
of the land. Since judicial power cannot be exercised
unless an actual controversy is brought before the
courts for resolution, decisions cannot be properly
modified unless another appropriate controversy
arises." (Sen. Edgardo J. Angara, "The Supreme
Court in Economic Policy Making," Policy Review —
A Quarterly Journal of Policy Studies, Vol. 1, No. 1,
January-March 1994, published by the Senate
Policy Studies Group, pp. 2-3.)
A further set-back in entertaining the petition is that it unfortunately
likewise strikes at factual issues. The allegations to the effect that
irregularities have been committed in the processing and evaluation of
the bids to favor respondent PGMC; that the Malacañang Special
Review Committee did not verify warranties embodied in the contract;
that the operation of telecommunication facilities is indispensable in the
operation of the lottery system; the involvement of multi-national
corporations in the operation of the on-line "hi-tech" lottery system, and
the like, require the submission of evidence. This Court is not a trier of
facts, and it cannot, at this time, resolve the above issues. Just
recently, the Court has noted petitioners' manifestation of its petition
with the Securities and Exchange Commission "for the nullification of
the General Information Sheets of PGMC" in respect particularly to the
nationality holdings in the corporation. The doctrine of primary
jurisdiction would not justify a disregard of the jurisdiction of, nor would
it permit us to now preempt, said Commission on the matter.
Petitioners strongly assert, in an attempt to get the Court's concurrence
in accepting the petition, that since lottery is a game of chance, the
"lotto" system would itself be a "crime against morals" defined by
Articles 195-199 6 of the Revised Penal Code.
Being immoral and a criminal offense under the Revised Penal Code,
petitioners contend, any special law authorizing gambling must, by all
canons of statutory constructions, be interpreted strictly against the
grantee. Citing previous decisions of this Court, they maintain that
lottery is gambling, pure and simple, 7 and that this Court has
consistently condemned the immorality and illegality of gambling to be
a "national offense and not a minor transgression;" 8 "that it is a social
scourge which must be stamped out;" 9 and, "that it is pernicious to the
body politic and detrimental to the nation and its citizens."10
I most certainly will not renounce this Court's above concerns.
Nevertheless, the Court must recognize the limitations of its own
authority. Courts neither legislate nor ignore legal mandates. Republic
Act No. 1169, as amended, explicitly gives public respondent
PCSO the authority and power "to hold and conduct sweepstakes
races, lotteries, and other similar activities." In addition, it is authorized:
c. To undertake any other activity that will enhance
its funds generation, operations and funds
management capabilities, subject to the same
limitations provided for in the preceding paragraph.
It shall have a Board of Directors, hereinafter
designated the Board, composed of five members
who shall be appointed, and whose compensation
and term of office shall be fixed, by the President.
xxx xxx xxx
Sec.9. Powers and functions of the Board of
Directors. — The Board of Directors of the Office
shall have the following powers and functions.
(a) To adopt or amend such rules and regulations to
implement the provisions of this Act.
xxx xxx xxx
(d) To promulgate rules and regulations for the
operation of the Office and to do such act or acts as
may be necessary for the attainment of its purposes
and objectives. (Emphasis supplied).
In People vs. Dionisio, 11 cited by the petitioners themselves, we
remarked: "What evils should be corrected as pernicious to the body
politic, and how correction should be done, is a matter primarily
addressed to the discretion of the legislative department, not of the
courts . . . ." In Valmonte vs. PCSO, 12 we also said:
The Court, as held in several cases, does not pass
upon questions of wisdom, justice or expediency of
legislation and executive acts. It is not the province
of the courts to supervise legislation or executive
orders as to keep them within the bounds of
propriety, moral values and common sense. That is
primarily and even exclusively a concern of the
political departments of the government; otherwise,
there will be a violation of the principle of separation
of powers.
The constraints on judicial power are clear. I feel, the Court must thus
beg off, albeit not without reluctance, from giving due course to the
instant petition.
Accordingly, I vote for the dismissal of the petition.
KAPUNAN, J., dissenting:
I regret that I am unable to join my colleagues in the majority in spite of
my own personal distaste for gambling and other gaming operations.
Such considerations aside, I feel there are compelling reasons why the
instant petition should be dismissed. I shall forthwith state the reasons
why.
Petitioners anchor their principal objections against the contract entered
into between the Philippine Charity Sweepstakes Office (PCSO) and
the PGMC on the ground that the contract entered into by the PCSO
with the PGMC violates the PCSO Charter (R.A. No. 1169 as amended
by B.P. Blg 427, specifically section 1 thereof which bars the said body
from holding conducting lotteries "in collaboration, association or joint
venture with any person association, company or entity."). However, a
perusal of the petition reveals that the compelling reasons behind it,
while based on apparently legal questions involving the contract
between the PCSO and the PGMC, are prompted by the petitioners' to declare an act of the executive or legislative branch of our
moral objections against the whole idea of gambling operations government unconstitutional or illegal, what we actually accomplish is
operated by the government through the PCSO. The whole point of the the thwarting of the will of the elected representatives of the people in
petition, in essence, is a fight between good and evil, between the the executive or legislative branches government.6 Notwithstanding
morality or amorality of lottery operations conducted on a wide scale Article VIII, Section 1 of the Constitution, since the exercise of the
involving millions of individuals and affecting millions of lives. Their power of judicial review by this Court is inherently antidemocratic, this
media of opposition are the above stated defects in the said contract Court should exercise a becoming modesty in acting as a revisor of an
which they assail to be fatally defective. They come to this Court, as act of the executive or legislative branch. The tendency of a frequent
taxpayers and civic spirted citizens, asserting a right of standing on a and easy resort to the function of judicial review, particularly in areas of
transcendental issue which they assert to be of paramount public economic policy has become lamentably too common as to dwarf the
interest. political capacity of the people expressed through their representatives
Moral or legal questions aside, I believe that there are unfortunately in the policy making branches of government and to deaden their sense
certain standards1 that have to be followed in the exercise of this of moral responsibility. 7
Court's awesome power of review before this Court could even begin to This court has been accused, of late, of an officious tendency to delve
assay the validity of the contract between the PCSO and the PGMC. into areas better left to the political branches of government. 8 This
This, in spite of the apparent expansion of judicial power granted by tendency, if exercised by a court running riot over the other co-equal
Section 1 of Article VIII of the 1987 Constitution. It is fundamental that branches of government, poses a greater danger to our democratic
such standards be complied with before this Court could even begin to system than the perceived danger — real or imagined — of an
explore the substantive issues raised by any controversy brought executive branch espousing economic or social policies of doubtful
before it, for no issue brought before this court could possibly be so moral worth. Moreover economic policy decisions in the current milieu-
fundamental and paramount as to warrant a relaxation of the requisite including the act challenged in the instant case-involve complex factors
rules for judicial review developed by settled jurisprudence inorder to requiring flexibility and a wide range of discretion on the part of our
avoid entangling this court in controversies which properly belong to the economic managers which this Court should respect because our
legislative or executive branches of our government. The potential harm power of review, under the constitution, is a power to check, not to
to our system of government, premised on the concept of separation of supplant those acts or decisions of the elected representatives of the
powers, by the Court eager to exercise its powers and prerogatives at people.
every turn, cannot be gainsaid. The Constitution does not mandate this Finally, the instant petition was brought to this Court on the assumption
Court to wield the power of judicial review with excessive vigor and that the issue at bench raises primarily constitutional issues. As it has
alacrity in every area or at every turn, except in appropriate cases and ultimately turned out, the core foundation of the petitioners' objections
controversies which meet established requirements for constitutional to the LOTTO operations was based on the validity of the contract
adjudication. Article VIII Sec. 1 of the Constitution notwithstanding, between the PCSO and the PGMC in the light of Section 1 of R.A. 1169
there are questions which I believe are still beyond the pale of judicial as amended by B.P. Blg. 427. It might have been much more
power. Moreover, it is my considered opinion that the instant petition appropriate for the issue to have taken its normal course in the courts
does not meet the requirements set by this court for a valid exercise of below.
judicial review.
I vote to deny the petition.
Our Constitution expressly defines judicial power as including "the duty
to settle actual cases and controversies involving rights which are
legally demandable and enforceable, and to determine whether or not
there has been a grave abuse of discretion amounting to a lack or
excess of jurisdiction on the part of any branch or instrumentality of the
government." 2 This constitutional requirement for an actual case and
controversy limits this Court's power of review to precisely those suits
between adversary litigants with real interests at stake2 thus preventing
it from making all sorts of hypothetical pronouncements on abstract,
contingent and amorphous issues. The Court will therefore not pass
upon the validity of an act of government or a statute passed by a
legislative body without a requisite showing of injury. 3 A personal stake
is essential, which absence renders our pronouncements gratuitous
and certainly violative of the constitutional requirement for actual cases
and controversies.
The requirement for standing based on personal injury may of course
be bypassed, as the petitioners in this case attempt to do, by
considering the case as a "taxpayer suit" which would thereby clothe
them with the personality they would lack under ordinary
circumstances. However, the act assailed by the petitioners on the
whole involves the generation rather than disbursement of public funds.
In a line of cases starting from Pascual v. Secretary of Public Works 4
"taxpayer suits" have been understood to refer only to those cases
where the act or statute assailed involves the illegal or unconstitutional
disbursement of public funds derived from taxation. The main premise
behind the "taxpayer suit" is that the pecuniary interest of the taxpayer
is involved whenever there is an illegal or wasteful use of public funds
which grants them the right to question the appropriation or
disbursement on the basis of their contribution to government funds. 5
Since it has not been alleged that an illegal appropriation or
disbursement of a fund derived from taxation would be made in the
instant case, I fail to see how the petitioners in this case would be able
to satisfy the locus standi requirement on the basis of a "taxpayer's
suit". This alone should inhibit this Court from proceeding with the case
at bench. The interest alleged and the potential injury asserted are far
too general and hypothetical for us to rush into a judicial determination
of what to me appears to be judgment better left to executive branch of
our government.
This brings me to one more important point: The idea that a norm of
constitutional adjudication could be lightly brushed aside on the mere
supposition that an issue before the Court is of paramount public
concern does great harm to a democratic system which espouses a
delicate balance between three separate but co-equal branches of
government. It is equally of paramount public concern, certainly
paramount to the survival of our democracy, that acts of the other
branches of government are accorded due respect by this Court. Such
acts, done within their sphere of competence, have been — and should
always be — accorded with a presumption of regularity. When such
acts are assailed as illegal or unconstitutional, the burden falls upon
those who assail these acts to prove that they satisfy the essential
norms of constitutional adjudication, because when we finally proceed
G.R. No. 159139             January 13, 2004
INFORMATION TECHNOLOGY FOUNDATION OF THE
PHILIPPINES, MA. CORAZON M. AKOL, MIGUEL UY, EDUARDO H.
LOPEZ, AUGUSTO C. LAGMAN, REX C. DRILON, MIGUEL HILADO,
LEY SALCEDO, and MANUEL ALCUAZ JR., petitioners,
vs.
COMMISSION ON ELECTIONS; COMELEC CHAIRMAN BENJAMIN
ABALOS SR.; COMELEC BIDDING and AWARD COMMITTEE
CHAIRMAN EDUARDO D. MEJOS and MEMBERS GIDEON DE
GUZMAN, JOSE F. BALBUENA, LAMBERTO P. LLAMAS, and
BARTOLOME SINOCRUZ JR.; MEGA PACIFIC eSOLUTIONS, INC.;
and MEGA PACIFIC CONSORTIUM, respondents.
DECISION
PANGANIBAN, J.:
There is grave abuse of discretion (1) when an act is done contrary to
the Constitution, the law or jurisprudence; 1 or (2) when it is executed
whimsically, capriciously or arbitrarily out of malice, ill will or personal
bias.2 In the present case, the Commission on Elections approved the
assailed Resolution and awarded the subject Contract not only in clear
violation of law and jurisprudence, but also in reckless disregard of its
own bidding rules and procedure. For the automation of the counting
and canvassing of the ballots in the 2004 elections, Comelec awarded
the Contract to "Mega Pacific Consortium" an entity that had not
participated in the bidding. Despite this grant, the poll body signed the
actual automation Contract with "Mega Pacific eSolutions, Inc.," a
company that joined the bidding but had not met the eligibility
requirements.
Comelec awarded this billion-peso undertaking with inexplicable haste,
without adequately checking and observing mandatory financial,
technical and legal requirements. It also accepted the proferred
computer hardware and software even if, at the time of the award, they
had undeniably failed to pass eight critical requirements designed to
safeguard the integrity of elections, especially the following three items:
· They failed to achieve the accuracy rating criteria of 99.9995
percent set-up by the Comelec itself
· They were not able to detect previously downloaded results
at various canvassing or consolidation levels and to prevent
these from being inputted again
· They were unable to print the statutorily required audit trails
of the count/canvass at different levels without any loss of
data
Because of the foregoing violations of law and the glaring grave abuse
of discretion committed by Comelec, the Court has no choice but to
exercise its solemn "constitutional duty"3 to void the assailed Resolution
and the subject Contract. The illegal, imprudent and hasty actions of
the Commission have not only desecrated legal and jurisprudential
norms, but have also cast serious doubts upon the poll body’s ability
and capacity to conduct automated elections. Truly, the pith and soul of
democracy -- credible, orderly, and peaceful elections -- has been put
in jeopardy by the illegal and gravely abusive acts of Comelec.
The Case
Before us is a Petition 4 under Rule 65 of the Rules of Court, seeking (1)
to declare null and void Resolution No. 6074 of the Commission on
Elections (Comelec), which awarded "Phase II of the Modernization
Project of the Commission to Mega Pacific Consortium (MPC);" (2) to
enjoin the implementation of any further contract that may have been
entered into by Comelec "either with Mega Pacific Consortium and/or
Mega Pacific eSolutions, Inc. (MPEI);" and (3) to compel Comelec to
conduct a re-bidding of the project.
The Facts
The following facts are not disputed. They were culled from official
documents, the parties’ pleadings, as well as from admissions during
the Oral Argument on October 7, 2003.
On June 7, 1995, Congress passed Republic Act 8046, 5 which
authorized Comelec to conduct a nationwide demonstration of a
computerized election system and allowed the poll body to pilot-test the
system in the March 1996 elections in the Autonomous Region in
Muslim Mindanao (ARMM).
On December 22, 1997, Congress enacted Republic Act 8436 6
authorizing Comelec to use an automated election system (AES) for the
process of voting, counting votes and canvassing/consolidating the
results of the national and local elections. It also mandated the poll
body to acquire automated counting machines (ACMs), computer
equipment, devices and materials; and to adopt new electoral forms
and printing materials.
Initially intending to implement the automation during the May 11, 1998
presidential elections, Comelec -- in its Resolution No. 2985 dated
February 9, 19987 -- eventually decided against full national
implementation and limited the automation to the Autonomous Region
in Muslim Mindanao (ARMM). However, due to the failure of the
machines to read correctly some automated ballots in one town, the
poll body later ordered their manual count for the entire Province of
Sulu.8
In the May 2001 elections, the counting and canvassing of votes for
both national and local positions were also done manually, as no
additional ACMs had been acquired for that electoral exercise allegedly
because of time constraints.
On October 29, 2002, Comelec adopted in its Resolution 02-0170 a
modernization program for the 2004 elections. It resolved to conduct
biddings for the three (3) phases of its Automated Election System;
namely, Phase I - Voter Registration and Validation System; Phase II -
Automated Counting and Canvassing System; and Phase III -
Electronic Transmission.
On January 24, 2003, President Gloria Macapagal-Arroyo issued
Executive Order No. 172, which allocated the sum of P2.5 billion to
fund the AES for the May 10, 2004 elections. Upon the request of
Comelec, she authorized the release of an additional P500 million.
On January 28, 2003, the Commission issued an "Invitation to Apply for
Eligibility and to Bid," which we quote as follows:
"INVITATION TO APPLY FOR ELIGIBILITY AND TO BID
The Commission on Elections (COMELEC), pursuant to the
mandate of Republic Act Nos. 8189 and 8436, invites
interested offerors, vendors, suppliers or lessors to apply for
eligibility and to bid for the procurement by purchase, lease,
lease with option to purchase, or otherwise, supplies,
equipment, materials and services needed for a
comprehensive Automated Election System, consisting of
three (3) phases: (a) registration/verification of voters, (b)
automated counting and consolidation of votes, and (c)
electronic transmission of election results, with an approved
budget of TWO BILLION FIVE HUNDRED MILLION
(Php2,500,000,000) Pesos.
Only bids from the following entities shall be entertained:
a. Duly licensed Filipino citizens/proprietorships;
b. Partnerships duly organized under the laws of the
Philippines and of which at least sixty percent (60%)
of the interest belongs to citizens of the Philippines;
c. Corporations duly organized under the laws of the
Philippines, and of which at least sixty percent
(60%) of the outstanding capital stock belongs to
citizens of the Philippines;
d. Manufacturers, suppliers and/or distributors
forming themselves into a joint venture, i.e., a group
of two (2) or more manufacturers, suppliers and/or
distributors that intend to be jointly and severally
responsible or liable for a particular contract,
provided that Filipino ownership thereof shall be at
least sixty percent (60%); and
e. Cooperatives duly registered with the
Cooperatives Development Authority.
Bid documents for the three (3) phases may be obtained
starting 10 February 2003, during office hours from the Bids
and Awards Committee (BAC) Secretariat/Office of
Commissioner Resurreccion Z. Borra, 7th Floor, Palacio del
Governador, Intramuros, Manila, upon payment at the Cash
Division, Commission on Elections, in cash or cashier’s
check, payable to the Commission on Elections, of a non-
refundable amount of FIFTEEN THOUSAND PESOS
(Php15,000.00) for each phase. For this purpose, interested
offerors, vendors, suppliers or lessors have the option to
participate in any or all of the three (3) phases of the
comprehensive Automated Election System.
A Pre-Bid Conference is scheduled on 13 February 2003, at
9:00 a.m. at the Session Hall, Commission on Elections,
Postigo Street, Intramuros, Manila. Should there be questions
on the bid documents, bidders are required to submit their
queries in writing to the BAC Secretariat prior to the
scheduled Pre-Bid Conference.
Deadline for submission to the BAC of applications for
eligibility and bid envelopes for the supply of the
comprehensive Automated Election System shall be at the
Session Hall, Commission on Elections, Postigo Street,
Intramuros, Manila on 28 February 2003 at 9:00 a.m.
The COMELEC reserves the right to review the qualifications
of the bidders after the bidding and before the contract is
executed. Should such review uncover any misrepresentation
made in the eligibility statements, or any changes in the
situation of the bidder to materially downgrade the substance
of such statements, the COMELEC shall disqualify the bidder
upon due notice without any obligation whatsoever for any
expenses or losses that may be incurred by it in the
preparation of its bid."9
On February 11, 2003, Comelec issued Resolution No. 5929 clarifying
certain eligibility criteria for bidders and the schedule of activities for the
project bidding, as follows:
 "1.) Open to Filipino and foreign corporation duly registered
and licensed to do business and is actually doing business in
the Philippines, subject to Sec. 43 of RA 9184 (An Act
providing In the Modernization Standardization and
Regulation of the Procurement Activities of the Government
and for other purposes etc.)
2.) Track Record:
a) For counting machines – should have been used
in at least one (1) political exercise with no less than
Twenty Million Voters;
b) For verification of voters – the reference site of an
existing data base installation using Automated
Fingerprint Identification System (AFIS) with at least
Twenty Million.
3.) Ten percent (10%) equity requirement shall be based on
the total project cost; and
4.) Performance bond shall be twenty percent (20%) of the bid
offer.
RESOLVED moreover, that:
1) A. Due to the decision that the eligibility
requirements and the rest of the Bid documents
shall be released at the same time, and the
memorandum of Comm. Resurreccion Z. Borra
dated February 7, 2003, the documents to be
released on Friday, February 14, 2003 at 2:00
o’clock p.m. shall be the eligibility criteria, Terms of
Reference (TOR) and other pertinent documents;
B. Pre-Bid conference shall be on
February 18, 2003; and
C. Deadline for the submission and receipt
of the Bids shall be on March 5, 2003.
2) The aforementioned documents will be available
at the following offices:
a) Voters Validation: Office of Comm.
Javier
b) Automated Counting Machines: Office
of Comm. Borra
c) Electronic Transmission: Office of
Comm. Tancangco"10
On February 17, 2003, the poll body released the Request for Proposal
(RFP) to procure the election automation machines. The Bids and
Awards Committee (BAC) of Comelec convened a pre-bid conference
on February 18, 2003 and gave prospective bidders until March 10,
2003 to submit their respective bids.
Among others, the RFP provided that bids from manufacturers,
suppliers and/or distributors forming themselves into a joint venture
may be entertained, provided that the Philippine ownership thereof shall
be at least 60 percent. Joint venture is defined in the RFP as "a group
of two or more manufacturers, suppliers and/or distributors that intend
to be jointly and severally responsible or liable for a particular
contract."11
Basically, the public bidding was to be conducted under a two-
envelope/two stage system. The bidder’s first envelope or the Eligibility
Envelope should establish the bidder’s eligibility to bid and its
qualifications to perform the acts if accepted. On the other hand, the
second envelope would be the Bid Envelope itself. The RFP outlines
the bidding procedures as follows:
"25. Determination of Eligibility of Prospective Bidders
"25.1 The eligibility envelopes of prospective
Bidders shall be opened first to determine their
eligibility. In case any of the requirements specified
in Clause 20 is missing from the first bid envelope,
the BAC shall declare said prospective Bidder as
ineligible to bid. Bid envelopes of ineligible Bidders
shall be immediately returned unopened.
"25.2 The eligibility of prospective Bidders shall be
determined using simple ‘pass/fail’ criteria and shall
be determined as either eligible or ineligible. If the
prospective Bidder is rated ‘passed’ for all the legal,
technical and financial requirements, he shall be
considered eligible. If the prospective Bidder is rated
‘failed’ in any of the requirements, he shall be
considered ineligible.
"26. Bid Examination/Evaluation
"26.1 The BAC will examine the Bids to determine
whether they are complete, whether any
computational errors have been made, whether
required securities have been furnished, whether the
documents have been properly signed, and whether
the Bids are generally in order.
"26.2 The BAC shall check the submitted
documents of each Bidder against the required
documents enumerated under Clause 20, to
ascertain if they are all present in the Second bid
envelope (Technical Envelope). In case one (1) or
more of the required documents is missing, the BAC
shall rate the Bid concerned as ‘failed’ and
immediately return to the Bidder its Third bid
envelope (Financial Envelope) unopened.
Otherwise, the BAC shall rate the first bid envelope
as ‘passed’.
"26.3 The BAC shall immediately open the Financial
Envelopes of the Bidders whose Technical
Envelopes were passed or rated on or above the
passing score. Only Bids that are determined to
contain all the bid requirements for both components
shall be rated ‘passed’ and shall immediately be
considered for evaluation and comparison.
"26.4 In the opening and examination of the
Financial Envelope, the BAC shall announce and
tabulate the Total Bid Price as calculated.
Arithmetical errors will be rectified on the following
basis: If there is a discrepancy between words and
figures, the amount in words will prevail. If there is a
discrepancy between the unit price and the total
price that is obtained by multiplying the unit price
and the quantity, the unit price shall prevail and the
total price shall be corrected accordingly. If there is
a discrepancy between the Total Bid Price and the
sum of the total prices, the sum of the total prices
prevail and the Total Bid Price shall be corrected
accordingly.
"26.5 Financial Proposals which do not clearly state
the Total Bid Price shall be rejected. Also, Total Bid
Price as calculated that exceeds the approved
budget for the contract shall also be rejected.
27. Comparison of Bids
27.1 The bid price shall be deemed to embrace all
costs, charges and fees associated with carrying out
all the elements of the proposed Contract, including
but not limited to, license fees, freight charges and
taxes.
27.2 The BAC shall establish the calculated prices
of all Bids rated ‘passed’ and rank the same in
ascending order.
xxxxxxxxx
"29. Postqualification
"29.1 The BAC will determine to its satisfaction
whether the Bidder selected as having submitted the
lowest calculated bid is qualified to satisfactorily
perform the Contract.
"29.2 The determination will take into account the
Bidder’s financial, technical and production
capabilities/resources. It will be based upon an
examination of the documentary evidence of the
Bidder’s qualification submitted by the Bidder as well
as such other information as the BAC deems
necessary and appropriate.
"29.3 A bid determined as not substantially
responsive will be rejected by the BAC and may not
subsequently be made responsive by the Bidder by
correction of the non-conformity.
"29.4 The BAC may waive any informality or non-
conformity or irregularity in a bid which does not
constitute a material deviation, provided such waiver
does not prejudice or affect the relative ranking of
any Bidder.
"29.5 Should the BAC find that the Bidder complies
with the legal, financial and technical requirements,
it shall make an affirmative determination which
shall be a prerequisite for award of the Contract to
the Bidder. Otherwise, it will make a negative
determination which will result in rejection of the
Bidder’s bid, in which event the BAC will proceed to
the next lowest calculated bid to make a similar
determination of that Bidder’s capabilities to perform
satisfactorily."12
Out of the 57 bidders,13 the BAC found MPC and the Total Information
Management Corporation (TIMC) eligible. For technical evaluation, they
were referred to the BAC’s Technical Working Group (TWG) and the
Department of Science and Technology (DOST).
In its Report on the Evaluation of the Technical Proposals on Phase II,
DOST said that both MPC and TIMC had obtained a number of failed
marks in the technical evaluation. Notwithstanding these failures,
Comelec en banc, on April 15, 2003, promulgated Resolution No. 6074
awarding the project to MPC. The Commission publicized this
Resolution and the award of the project to MPC on May 16, 2003.
On May 29, 2003, five individuals and entities (including the herein
Petitioners Information Technology Foundation of the Philippines,
represented by its president, Alfredo M. Torres; and Ma. Corazon Akol)
wrote a letter14 to Comelec Chairman Benjamin Abalos Sr. They
protested the award of the Contract to Respondent MPC "due to glaring
irregularities in the manner in which the bidding process had been
conducted." Citing therein the noncompliance with eligibility as well as
technical and procedural requirements (many of which have been
discussed at length in the Petition), they sought a re-bidding.
In a letter-reply dated June 6, 2003, 15 the Comelec chairman --
speaking through Atty. Jaime Paz, his head executive assistant --
rejected the protest and declared that the award "would stand up to the
strictest scrutiny."
Hence, the present Petition.16
The Issues
In their Memorandum, petitioners raise the following issues for our
consideration:
"1. The COMELEC awarded and contracted with a non-
eligible entity; x x x
"2. Private respondents failed to pass the Technical Test as
required in the RFP. Notwithstanding, such failure was
ignored. In effect, the COMELEC changed the rules after the
bidding in effect changing the nature of the contract bidded
upon.
"3. Petitioners have locus standi.
"4. Instant Petition is not premature. Direct resort to the
Supreme Court is justified."17
In the main, the substantive issue is whether the Commission on
Elections, the agency vested with the exclusive constitutional mandate
to oversee elections, gravely abused its discretion when, in the exercise
of its administrative functions, it awarded to MPC the contract for the
second phase of the comprehensive Automated Election System.
Before discussing the validity of the award to MPC, however, we deem
it proper to first pass upon the procedural issues: the legal standing of
petitioners and the alleged prematurity of the Petition.
This Court’s Ruling
The Petition is meritorious.
First Procedural Issue:
Locus Standi of Petitioners
Respondents chorus that petitioners do not possess locus standi,
inasmuch as they are not challenging the validity or constitutionality of
RA 8436. Moreover, petitioners supposedly admitted during the Oral
Argument that no law had been violated by the award of the Contract.
Furthermore, they allegedly have no actual and material interest in the
Contract and, hence, do not stand to be injured or prejudiced on
account of the award.
On the other hand, petitioners -- suing in their capacities as taxpayers,
registered voters and concerned citizens -- respond that the issues
central to this case are "of transcendental importance and of national
interest." Allegedly, Comelec’s flawed bidding and questionable award
of the Contract to an unqualified entity would impact directly on the
success or the failure of the electoral process. Thus, any taint on the
sanctity of the ballot as the expression of the will of the people would
inevitably affect their faith in the democratic system of government.
Petitioners further argue that the award of any contract for automation
involves disbursement of public funds in gargantuan amounts;
therefore, public interest requires that the laws governing the
transaction must be followed strictly.
We agree with petitioners. Our nation’s political and economic future
virtually hangs in the balance, pending the outcome of the 2004
elections. Hence, there can be no serious doubt that the subject matter
of this case is "a matter of public concern and imbued with public
interest";18 in other words, it is of "paramount public interest" 19 and
"transcendental importance."20 This fact alone would justify relaxing the
rule on legal standing, following the liberal policy of this Court whenever
a case involves "an issue of overarching significance to our society." 21
Petitioners’ legal standing should therefore be recognized and upheld.
Moreover, this Court has held that taxpayers are allowed to sue when
there is a claim of "illegal disbursement of public funds,"22 or if public
money is being "deflected to any improper purpose"; 23 or when
petitioners seek to restrain respondent from "wasting public funds
through the enforcement of an invalid or unconstitutional law." 24 In the
instant case, individual petitioners, suing as taxpayers, assert a
material interest in seeing to it that public funds are properly and
lawfully used. In the Petition, they claim that the bidding was defective,
the winning bidder not a qualified entity, and the award of the Contract
contrary to law and regulation. Accordingly, they seek to restrain
respondents from implementing the Contract and, necessarily, from
making any unwarranted expenditure of public funds pursuant thereto.
Thus, we hold that petitioners possess locus standi.
Second Procedural Issue:
Alleged Prematurity Due to Non-Exhaustion of Administrative
Remedies
Respondents claim that petitioners acted prematurely, since they had
not first utilized the protest mechanism available to them under RA
9184, the Government Procurement Reform Act, for the settlement of
disputes pertaining to procurement contracts.
Section 55 of RA 9184 states that protests against decisions of the
Bidding and Awards Committee in all stages of procurement may be
lodged with the head of the procuring entity by filing a verified position
paper and paying a protest fee. Section 57 of the same law mandates
that in no case shall any such protest stay or delay the bidding process,
but it must first be resolved before any award is made.
On the other hand, Section 58 provides that court action may be
resorted to only after the protests contemplated by the statute shall
have been completed. Cases filed in violation of this process are to be
dismissed for lack of jurisdiction. Regional trial courts shall have
jurisdiction over final decisions of the head of the procuring entity, and
court actions shall be instituted pursuant to Rule 65 of the 1997 Rules
of Civil Procedure.
Respondents assert that throughout the bidding process, petitioners
never questioned the BAC Report finding MPC eligible to bid and
recommending the award of the Contract to it (MPC). According to
respondents, the Report should have been appealed to the Comelc en
banc, pursuant to the aforementioned sections of RA 9184. In the
absence of such appeal, the determination and recommendation of the
BAC had become final.
The Court is not persuaded.
Respondent Comelec came out with its en banc Resolution No. 6074
dated April 15, 2003, awarding the project to Respondent MPC even
before the BAC managed to issue its written report and
recommendation on April 21, 2003. Thus, how could petitioners have
appealed the BAC’s recommendation or report to the head of the
procuring entity (the chairman of Comelec), when the Comelec en banc
had already approved the award of the contract to MPC even before
petitioners learned of the BAC recommendation?
It is claimed25 by Comelec that during its April 15, 2003 session, it
received and approved the verbal report and recommendation of the
BAC for the award of the Contract to MPC, and that the BAC
subsequently re-affirmed its verbal report and recommendation by
submitting it in writing on April 21, 2003. Respondents insist that the
law does not require that the BAC Report be in writing before Comelec
can act thereon; therefore, there is allegedly nothing irregular about the
Report as well as the en banc Resolution.
However, it is obvious that petitioners could have appealed the BAC’s
report and recommendation to the head of the procuring entity (the
Comelec chair) only upon their discovery thereof, which at the very
earliest would have been on April 21, 2003, when the BAC actually put
its report in writing and finally released it. Even then, what would have
been the use of protesting/appealing the report to the Comelec chair,
when by that time the Commission en banc (including the chairman
himself) had already approved the BAC Report and awarded the
Contract to MPC?
And even assuming arguendo that petitioners had somehow gotten
wind of the verbal BAC report on April 15, 2003 (immediately after the
en banc session), at that point the Commission en banc had already
given its approval to the BAC Report along with the award to MPC. To
put it bluntly, the Comelec en banc itself made it legally impossible for
petitioners to avail themselves of the administrative remedy that the
Commission is so impiously harping on. There is no doubt that they had
not been accorded the opportunity to avail themselves of the process
provided under Section 55 of RA 9184, according to which a protest
against a decision of the BAC may be filed with the head of the
procuring entity. Nemo tenetur ad impossible,26 to borrow private
respondents’ favorite Latin excuse.27
Some Observations on the BAC Report to the Comelec
We shall return to this issue of alleged prematurity shortly, but at this
interstice, we would just want to put forward a few observations
regarding the BAC Report and the Comelec en banc’s approval thereof.
First, Comelec contends that there was nothing unusual about the fact
that the Report submitted by the BAC came only after the former had
already awarded the Contract, because the latter had been asked to
render its report and recommendation orally during the Commission’s
en banc session on April 15, 2003. Accordingly, Comelec supposedly
acted upon such oral recommendation and approved the award to MPC
on the same day, following which the recommendation was
subsequently reduced into writing on April 21, 2003. While not entirely
outside the realm of the possible, this interesting and unique spiel does
not speak well of the process that Comelec supposedly went through in
making a critical decision with respect to a multi-billion-peso contract.
We can imagine that anyone else standing in the shoes of the
Honorable Commissioners would have been extremely conscious of the
overarching need for utter transparency. They would have scrupulously
avoided the slightest hint of impropriety, preferring to maintain an
exacting regularity in the performance of their duties, instead of trying to
break a speed record in the award of multi-billion-peso contracts. After
all, between April 15 and April 21 were a mere six (6) days. Could
Comelec not have waited out six more days for the written report of the
BAC, instead of rushing pell-mell into the arms of MPC? Certainly,
respondents never cared to explain the nature of the Commission’s dire
need to act immediately without awaiting the formal, written BAC
Report.
In short, the Court finds it difficult to reconcile the uncommon dispatch
with which Comelec acted to approve the multi-billion-peso deal, with
its claim of having been impelled by only the purest and most noble of
motives.
At any rate, as will be discussed later on, several other factors combine
to lend negative credence to Comelec’s tale.
Second, without necessarily ascribing any premature malice or
premeditation on the part of the Comelec officials involved, it should
nevertheless be conceded that this cart-before-the-horse maneuver
(awarding of the Contract ahead of the BAC’s written report) would
definitely serve as a clever and effective way of averting and frustrating
any impending protest under Section 55.
Having made the foregoing observations, we now go back to the
question of exhausting administrative remedies. Respondents may not
have realized it, but the letter addressed to Chairman Benjamin Abalos
Sr. dated May 29, 2003 28 serves to eliminate the prematurity issue as it
was an actual written protest against the decision of the poll body to
award the Contract. The letter was signed by/for, inter alia, two of
herein petitioners: the Information Technology Foundation of the
Philippines, represented by its president, Alfredo M. Torres; and Ma.
Corazon Akol.
Such letter-protest is sufficient compliance with the requirement to
exhaust administrative remedies particularly because it hews closely to
the procedure outlined in Section 55 of RA 9184.
And even without that May 29, 2003 letter-protest, the Court still holds
that petitioners need not exhaust administrative remedies in the light of
Paat v. Court of Appeals.29 Paat enumerates the instances when the
rule on exhaustion of administrative remedies may be disregarded, as
follows:
"(1) when there is a violation of due process,
(2) when the issue involved is purely a legal question,
(3) when the administrative action is patently illegal amounting
to lack or excess of jurisdiction,
(4) when there is estoppel on the part of the administrative
agency concerned,
(5) when there is irreparable injury,
(6) when the respondent is a department secretary whose
acts as an alter ego of the President bears the implied and
assumed approval of the latter,
(7) when to require exhaustion of administrative remedies
would be unreasonable,
(8) when it would amount to a nullification of a claim,
(9) when the subject matter is a private land in land case
proceedings,
(10) when the rule does not provide a plain, speedy and
adequate remedy, and
(11) when there are circumstances indicating the urgency of
judicial intervention."30
The present controversy precisely falls within the exceptions listed as
Nos. 7, 10 and 11: "(7) when to require exhaustion of administrative
remedies would be unreasonable; (10) when the rule does not provide
a plain, speedy and adequate remedy, and (11) when there are
circumstances indicating the urgency of judicial intervention." As
already stated, Comelec itself made the exhaustion of administrative
remedies legally impossible or, at the very least, "unreasonable."
In any event, the peculiar circumstances surrounding the
unconventional rendition of the BAC Report and the precipitate
awarding of the Contract by the Comelec en banc -- plus the fact that it
was racing to have its Contract with MPC implemented in time for the
elections in May 2004 (barely four months away) -- have combined to
bring about the urgent need for judicial intervention, thus prompting this
Court to dispense with the procedural exhaustion of administrative
remedies in this case.
Main Substantive Issue:
Validity of the Award to MPC
We come now to the meat of the controversy. Petitioners contend that
the award is invalid, since Comelec gravely abused its discretion when
it did the following:
1. Awarded the Contract to MPC though it did not even
participate in the bidding
2. Allowed MPEI to participate in the bidding despite its failure
to meet the mandatory eligibility requirements
3. Issued its Resolution of April 15, 2003 awarding the
Contract to MPC despite the issuance by the BAC of its
Report, which formed the basis of the assailed Resolution,
only on April 21, 200331
4. Awarded the Contract, notwithstanding the fact that during
the bidding process, there were violations of the mandatory
requirements of RA 8436 as well as those set forth in
Comelec’s own Request for Proposal on the automated
election system
5. Refused to declare a failed bidding and to conduct a re-
bidding despite the failure of the bidders to pass the technical
tests conducted by the Department of Science and
Technology
6. Failed to follow strictly the provisions of RA 8436 in the
conduct of the bidding for the automated counting machines
After reviewing the slew of pleadings as well as the matters raised
during the Oral Argument, the Court deems it sufficient to focus
discussion on the following major areas of concern that impinge on the
issue of grave abuse of discretion:
A. Matters pertaining to the identity, existence and eligibility of
MPC as a bidder
B. Failure of the automated counting machines (ACMs) to
pass the DOST technical tests
C. Remedial measures and re-testings undertaken by
Comelec and DOST after the award, and their effect on the
present controversy
A.
Failure to Establish the Identity, Existence and Eligibility of the Alleged
Consortium as a Bidder
On the question of the identity and the existence of the real bidder,
respondents insist that, contrary to petitioners’ allegations, the bidder
was not Mega Pacific eSolutions, Inc. (MPEI), which was incorporated
only on February 27, 2003, or 11 days prior to the bidding itself. Rather,
the bidder was Mega Pacific Consortium (MPC), of which MPEI was but
a part. As proof thereof, they point to the March 7, 2003 letter of intent
to bid, signed by the president of MPEI allegedly for and on behalf of
MPC. They also call attention to the official receipt issued to MPC,
acknowledging payment for the bidding documents, as proof that it was
the "consortium" that participated in the bidding process.
We do not agree. The March 7, 2003 letter, signed by only one
signatory -- "Willy U. Yu, President, Mega Pacific eSolutions, Inc.,
(Lead Company/ Proponent) For: Mega Pacific Consortium" -- and
without any further proof, does not by itself prove the existence of the
consortium. It does not show that MPEI or its president have been duly
pre-authorized by the other members of the putative consortium to
represent them, to bid on their collective behalf and, more important, to
commit them jointly and severally to the bid undertakings. The letter is
purely self-serving and uncorroborated.
Neither does an official receipt issued to MPC, acknowledging payment
for the bidding documents, constitute proof that it was the purported
consortium that participated in the bidding. Such receipts are issued by
cashiers without any legally sufficient inquiry as to the real identity
orexistence of the supposed payor.
To assure itself properly of the due existence (as well as eligibility and
qualification) of the putative consortium, Comelec’s BAC should have
examined the bidding documents submitted on behalf of MPC. They
would have easily discovered the following fatal flaws.
Two-Envelope,
Two-Stage System
As stated earlier in our factual presentation, the public bidding system
designed by Comelec under its RFP (Request for Proposal for the
Automation of the 2004 Election) mandated the use of a two-envelope,
two-stage system. A bidder’s first envelope (Eligibility Envelope) was
meant to establish its eligibility to bid and its qualifications and capacity
to perform the contract if its bid was accepted, while the second
envelope would be the Bid Envelope itself.
The Eligibility Envelope was to contain legal documents such as articles
of incorporation, business registrations, licenses and permits, mayor’s
permit, VAT certification, and so forth; technical documents containing
documentary evidence to establish the track record of the bidder and its
technical and production capabilities to perform the contract; and
financial documents, including audited financial statements for the last
three years, to establish the bidder’s financial capacity.
In the case of a consortium or joint venture desirous of participating in
the bidding, it goes without saying that the Eligibility Envelope would
necessarily have to include a copy of the joint venture agreement, the
consortium agreement or memorandum of agreement -- or a business
plan or some other instrument of similar import -- establishing the due
existence, composition and scope of such aggrupation. Otherwise, how
would Comelec know who it was dealing with, and whether these
parties are qualified and capable of delivering the products and
services being offered for bidding?32
In the instant case, no such instrument was submitted to Comelec
during the bidding process. This fact can be conclusively ascertained
by scrutinizing the two-inch thick "Eligibility Requirements" file
submitted by Comelec last October 9, 2003, in partial compliance with
this Court’s instructions given during the Oral Argument. This file
purports to replicate the eligibility documents originally submitted to
Comelec by MPEI allegedly on behalf of MPC, in connection with the
bidding conducted in March 2003. Included in the file are the
incorporation papers and financial statements of the members of the
supposed consortium and certain certificates, licenses and permits
issued to them.
However, there is no sign whatsoever of any joint venture agreement,
consortium agreement, memorandum of agreement, or business plan
executed among the members of the purported consortium.
The only logical conclusion is that no such agreement was ever
submitted to the Comelec for its consideration, as part of the bidding
process.
It thus follows that, prior the award of the Contract, there was no
documentary or other basis for Comelec to conclude that a consortium
had actually been formed amongst MPEI, SK C&C and WeSolv, along
with Election.com and ePLDT.33 Neither was there anything to indicate
the exact relationships between and among these firms; their diverse
roles, undertakings and prestations, if any, relative to the prosecution of
the project, the extent of their respective investments (if any) in the
supposed consortium or in the project; and the precise nature and
extent of their respective liabilities with respect to the contract being
offered for bidding. And apart from the self-serving letter of March 7,
2003, there was not even any indication that MPEI was the lead
company duly authorized to act on behalf of the others.
So, it necessarily follows that, during the bidding process, Comelec had
no basis at all for determining that the alleged consortium really existed
and was eligible and qualified; and that the arrangements among the
members were satisfactory and sufficient to ensure delivery on the
Contract and to protect the government’s interest.
Notwithstanding such deficiencies, Comelec still deemed the
"consortium" eligible to participate in the bidding, proceeded to open its
Second Envelope, and eventually awarded the bid to it, even though --
per the Comelec’s own RFP -- the BAC should have declared the MPC
ineligible to bid and returned the Second (Bid) Envelope unopened.
Inasmuch as Comelec should not have considered MPEI et al. as
comprising a consortium or joint venture, it should not have allowed
them to avail themselves of the provision in Section 5.4 (b) (i) of the
IRR for RA 6957 (the Build-Operate-Transfer Law), as amended by RA
7718. This provision states in part that a joint venture/consortium
proponent shall be evaluated based on the individual or collective
experience of the member-firms of the joint venture or consortium and
of the contractor(s) that it has engaged for the project. Parenthetically,
respondents have uniformly argued that the said IRR of RA 6957, as
amended, have suppletory application to the instant case.
Hence, had the proponent MPEI been evaluated based solely on its
own experience, financial and operational track record or lack thereof, it
would surely not have qualified and would have been immediately
considered ineligible to bid, as respondents readily admit.
At any rate, it is clear that Comelec gravely abused its discretion in
arbitrarily failing to observe its own rules, policies and guidelines with
respect to the bidding process, thereby negating a fair, honest and
competitive bidding.
Commissioners Not Aware of Consortium
In this regard, the Court is beguiled by the statements of Commissioner
Florentino Tuason Jr., given in open court during the Oral Argument
last October 7, 2003. The good commissioner affirmed that he was
aware, of his own personal knowledge, that there had indeed been a
written agreement among the "consortium" members, 34 although it was
an internal matter among them, 35 and of the fact that it would be
presented by counsel for private respondent. 36
However, under questioning by Chief Justice Hilario G. Davide Jr. and
Justice Jose C. Vitug, Commissioner Tuason in effect admitted that,
while he was the commissioner-in-charge of Comelec’s Legal
Department, he had never seen, even up to that late date, the
agreement he spoke of.37 Under further questioning, he was likewise
unable to provide any information regarding the amounts invested into
the project by several members of the claimed consortium. 38 A short
while later, he admitted that the Commission had not taken a look at the
agreement (if any).39
He tried to justify his position by claiming that he was not a member of
the BAC. Neither was he the commissioner-in-charge of the Phase II
Modernization project (the automated election system); but that, in any
case, the BAC and the Phase II Modernization Project Team did look
into the aspect of the composition of the consortium.
It seems to the Court, though, that even if the BAC or the Phase II
Team had taken charge of evaluating the eligibility, qualifications and
credentials of the consortium-bidder, still, in all probability, the former
would have referred the task to Commissioner Tuason, head of
Comelec’s Legal Department. That task was the appreciation and
evaluation of the legal effects and consequences of the terms,
conditions, stipulations and covenants contained in any joint venture
agreement, consortium agreement or a similar document -- assuming of
course that any of these was available at the time. The fact that
Commissioner Tuason was barely aware of the situation bespeaks the
complete absence of such document, or the utter failure or neglect of
the Comelec to examine it -- assuming it was available at all -- at the
time the award was made on April 15, 2003.
In any event, the Court notes for the record that Commissioner Tuason
basically contradicted his statements in open court about there being
one written agreement among all the consortium members, when he
subsequently referred40 to the four (4) Memoranda of Agreement
(MOAs) executed by them.41
At this juncture, one might ask: What, then, if there are four MOAs
instead of one or none at all? Isn’t it enough that there are these
corporations coming together to carry out the automation project? Isn’t
it true, as respondent aver, that nowhere in the RFP issued by Comelec
is it required that the members of the joint venture execute a single
written agreement to prove the existence of a joint venture. Indeed, the
intention to be jointly and severally liable may be evidenced not only by
a single joint venture agreement, but also by supplementary documents
executed by the parties signifying such intention. What then is the big
deal?
The problem is not that there are four agreements instead of only one.
The problem is that Comelec never bothered to check. It never based
its decision on documents or other proof that would concretely establish
the existence of the claimed consortium or joint venture or
agglomeration. It relied merely on the self-serving representation in an
uncorroborated letter signed by only one individual, claiming that his
company represented a "consortium" of several different corporations.
It concluded forthwith that a consortium indeed existed, composed of
such and such members, and thereafter declared that the entity was
eligible to bid.
True, copies of financial statements and incorporation papers of the
alleged "consortium" members were submitted. But these papers did
not establish the existence of a consortium, as they could have been
provided by the companies concerned for purposes other than to prove
that they were part of a consortium or joint venture. For instance, the
papers may have been intended to show that those companies were
each qualified to be a sub-contractor (and nothing more) in a major
project. Those documents did not by themselves support the
assumption that a consortium or joint venture existed among the
companies.
In brief, despite the absence of competent proof as to the existence and
eligibility of the alleged consortium (MPC), its capacity to deliver on the
Contract, and the members’ joint and several liability therefor, Comelec
nevertheless assumed that such consortium existed and was eligible. It
then went ahead and considered the bid of MPC, to which the Contract
was eventually awarded, in gross violation of the former’s own bidding
rules and procedures contained in its RFP. Therein lies Comelec’s
grave abuse of discretion.
Sufficiency of the Four Agreements
Instead of one multilateral agreement executed by, and effective and
binding on, all the five "consortium members" -- as earlier claimed by
Commissioner Tuason in open court -- it turns out that what was
actually executed were four (4) separate and distinct bilateral
Agreements.42 Obviously, Comelec was furnished copies of these
Agreements only after the bidding process had been terminated, as
these were not included in the Eligibility Documents. These
Agreements are as follows:
· A Memorandum of Agreement between MPEI and SK C&C
· A Memorandum of Agreement between MPEI and WeSolv
· A "Teaming Agreement" between MPEI and Election.com
Ltd.
· A "Teaming Agreement" between MPEI and ePLDT
In sum, each of the four different and separate bilateral Agreements is
valid and binding only between MPEI and the other contracting party,
leaving the other "consortium" members total strangers thereto. Under
this setup, MPEI dealt separately with each of the "members," and the
latter (WeSolv, SK C&C, Election.com, and ePLDT) in turn had nothing
to do with one another, each dealing only with MPEI.
Respondents assert that these four Agreements were sufficient for the
purpose of enabling the corporations to still qualify (even at that late
stage) as a consortium or joint venture, since the first two Agreements
had allegedly set forth the joint and several undertakings among the
parties, whereas the latter two clarified the parties’ respective roles with
regard to the Project, with MPEI being the independent contractor and
Election.com and ePLDT the subcontractors.
Additionally, the use of the phrase "particular contract" in the Comelec’s
Request for Proposal (RFP), in connection with the joint and several
liabilities of companies in a joint venture, is taken by them to mean that
all the members of the joint venture need not be solidarily liable for the
entire project or joint venture, because it is sufficient that the lead
company and the member in charge of a particular contract or aspect of
the joint venture agree to be solidarily liable.
At this point, it must be stressed most vigorously that the submission of
the four bilateral Agreements to Comelec after the end of the bidding
process did nothing to eliminate the grave abuse of discretion it had
already committed on April 15, 2003.
Deficiencies Have Not Been "Cured"
In any event, it is also claimed that the automation Contract awarded by
Comelec incorporates all documents executed by the "consortium"
members, even if these documents are not referred to therein. The
basis of this assertion appears to be the passages from Section 1.4 of
the Contract, which is reproduced as follows:
"All Contract Documents shall form part of the Contract even if
they or any one of them is not referred to or mentioned in the
Contract as forming a part thereof. Each of the Contract
Documents shall be mutually complementary and explanatory
of each other such that what is noted in one although not
shown in the other shall be considered contained in all, and
what is required by any one shall be as binding as if required
by all, unless one item is a correction of the other.
"The intent of the Contract Documents is the proper,
satisfactory and timely execution and completion of the
Project, in accordance with the Contract Documents.
Consequently, all items necessary for the proper and timely
execution and completion of the Project shall be deemed
included in the Contract."
Thus, it is argued that whatever perceived deficiencies there were in
the supplementary contracts -- those entered into by MPEI and the
other members of the "consortium" as regards their joint and several
undertakings -- have been cured. Better still, such deficiencies have
supposedly been prevented from arising as a result of the above-
quoted provisions, from which it can be immediately established that
each of the members of MPC assumes the same joint and several
liability as the other members.
The foregoing argument is unpersuasive. First, the contract being
referred to, entitled "The Automated Counting and Canvassing Project
Contract," is between Comelec and MPEI, not the alleged consortium,
MPC. To repeat, it is MPEI -- not MPC -- that is a party to the Contract.
Nowhere in that Contract is there any mention of a consortium or joint
venture, of members thereof, much less of joint and several liability.
Supposedly executed sometime in May 2003, 43 the Contract bears a
notarization date of June 30, 2003, and contains the signature of Willy
U. Yu signing as president of MPEI (not for and on behalf of MPC),
along with that of the Comelec chair. It provides in Section 3.2 that
MPEI (not MPC) is to supply the Equipment and perform the Services
under the Contract, in accordance with the appendices thereof; nothing
whatsoever is said about any consortium or joint venture or partnership.
Second, the portions of Section 1.4 of the Contract reproduced above
do not have the effect of curing (much less preventing) deficiencies in
the bilateral agreements entered into by MPEI with the other members
of the "consortium," with respect to their joint and several liabilities. The
term "Contract Documents," as used in the quoted passages of Section
1.4, has a well-defined meaning and actually refers only to the following
documents:
· The Contract itself along with its appendices
· The Request for Proposal (also known as "Terms of
Reference") issued by the Comelec, including the Tender
Inquiries and Bid Bulletins
· The Tender Proposal submitted by MPEI
In other words, the term "Contract Documents" cannot be understood
as referring to or including the MOAs and the Teaming Agreements
entered into by MPEI with SK C&C, WeSolv, Election.com and ePLDT.
This much is very clear and admits of no debate. The attempt to use
the provisions of Section 1.4 to shore up the MOAs and the Teaming
Agreements is simply unwarranted.
Third and last, we fail to see how respondents can arrive at the
conclusion that, from the above-quoted provisions, it can be
immediately established that each of the members of MPC assumes
the same joint and several liability as the other members. Earlier,
respondents claimed exactly the opposite -- that the two MOAs
(between MPEI and SK C&C, and between MPEI and WeSolv) had set
forth the joint and several undertakings among the parties; whereas the
two Teaming Agreements clarified the parties’ respective roles with
regard to the Project, with MPEI being the independent contractor and
Election.com and ePLDT the subcontractors.
Obviously, given the differences in their relationships, their respective
liabilities cannot be the same. Precisely, the very clear terms and
stipulations contained in the MOAs and the Teaming Agreements --
entered into by MPEI with SK C&C, WeSolv, Election.com and ePLDT
-- negate the idea that these "members" are on a par with one another
and are, as such, assuming the same joint and several liability.
Moreover, respondents have earlier seized upon the use of the term
"particular contract" in the Comelec’s Request for Proposal (RFP), in
order to argue that all the members of the joint venture did not need to
be solidarily liable for the entire project or joint venture. It was sufficient
that the lead company and the member in charge of a particular
contract or aspect of the joint venture would agree to be solidarily liable.
The glaring lack of consistency leaves us at a loss. Are respondents
trying to establish the same joint and solidary liability among all the
"members" or not?
Enforcement of Liabilities Problematic
Next, it is also maintained that the automation Contract between
Comelec and the MPEI confirms the solidary undertaking of the lead
company and the consortium member concerned for each particular
Contract, inasmuch as the position of MPEI and anyone else
performing the services contemplated under the Contract is described
therein as that of an independent contractor.
The Court does not see, however, how this conclusion was arrived at.
In the first place, the contractual provision being relied upon by
respondents is Article 14, "Independent Contractors," which states:
"Nothing contained herein shall be construed as establishing or creating
between the COMELEC and MEGA the relationship of employee and
employer or principal and agent, it being understood that the position of
MEGA and of anyone performing the Services contemplated under this
Contract, is that of an independent contractor."
Obviously, the intent behind the provision was simply to avoid the
creation of an employer-employee or a principal-agent relationship and
the complications that it would produce. Hence, the Article states that
the role or position of MPEI, or anyone else performing on its behalf, is
that of an independent contractor. It is obvious to the Court that
respondents are stretching matters too far when they claim that,
because of this provision, the Contract in effect confirms the solidary
undertaking of the lead company and the consortium member
concerned for the particular phase of the project. This assertion is an
absolute non sequitur.
Enforcement of Liabilities Under the Civil Code Not Possible
In any event, it is claimed that Comelec may still enforce the liability of
the "consortium" members under the Civil Code provisions on
partnership, reasoning that MPEI et al. represented themselves as
partners and members of MPC for purposes of bidding for the Project.
They are, therefore, liable to the Comelec to the extent that the latter
relied upon such representation. Their liability as partners is solidary
with respect to everything chargeable to the partnership under certain
conditions.
The Court has two points to make with respect to this argument. First, it
must be recalled that SK C&C, WeSolv, Election.com and ePLDT never
represented themselves as partners and members of MPC, whether for
purposes of bidding or for something else. It was MPEI alone that
represented them to be members of a "consortium" it supposedly
headed. Thus, its acts may not necessarily be held against the other
"members."
Second, this argument of the OSG in its Memorandum 44 might possibly
apply in the absence of a joint venture agreement or some other writing
that discloses the relationship of the "members" with one another. But
precisely, this case does not deal with a situation in which there is
nothing in writing to serve as reference, leaving Comelec to rely on
mere representations and therefore justifying a falling back on the rules
on partnership. For, again, the terms and stipulations of the MOAs
entered into by MPEI with SK C&C and WeSolv, as well as the
Teaming Agreements of MPEI with Election.com and ePLDT (copies of
which have been furnished the Comelec) are very clear with respect to
the extent and the limitations of the firms’ respective liabilities.
In the case of WeSolv and SK C&C, their MOAs state that their
liabilities, while joint and several with MPEI, are limited only to the
particular areas of work wherein their services are engaged or their
products utilized. As for Election.com and ePLDT, their separate
"Teaming Agreements" specifically ascribe to them the role of
subcontractor vis-à-vis MPEI as contractor and, based on the terms of
their particular agreements, neither Election.com nor ePLDT is, with
MPEI, jointly and severally liable to Comelec. 45 It follows then that in the
instant case, there is no justification for anyone, much less Comelec, to
resort to the rules on partnership and partners’ liabilities.
Eligibility of a Consortium Based on the Collective Qualifications
of Its Members
Respondents declare that, for purposes of assessing the eligibility of
the bidder, the members of MPC should be evaluated on a collective
basis. Therefore, they contend, the failure of MPEI to submit financial
statements (on account of its recent incorporation) should not by itself
disqualify MPC, since the other members of the "consortium" could
meet the criteria set out in the RFP.
Thus, according to respondents, the collective nature of the undertaking
of the members of MPC, their contribution of assets and sharing of
risks, and the community of their interest in the performance of the
Contract lead to these reasonable conclusions: (1) that their collective
qualifications should be the basis for evaluating their eligibility; (2) that
the sheer enormity of the project renders it improbable to expect any
single entity to be able to comply with all the eligibility requirements and
undertake the project by itself; and (3) that, as argued by the OSG, the
RFP allows bids from manufacturers, suppliers and/or distributors that
have formed themselves into a joint venture, in recognition of the virtual
impossibility of a single entity’s ability to respond to the Invitation to Bid.
Additionally, argues the Comelec, the Implementing Rules and
Regulations of RA 6957 (the Build-Operate-Transfer Law) as amended
by RA 7718 would be applicable, as proponents of BOT projects
usually form joint ventures or consortiums. Under the IRR, a joint
venture/consortium proponent shall be evaluated based on the
individual or the collective experience of the member-firms of the joint
venture/consortium and of the contractors the proponent has engaged
for the project.
Unfortunately, this argument seems to assume that the "collective"
nature of the undertaking of the members of MPC, their contribution of
assets and sharing of risks, and the "community" of their interest in the
performance of the Contract entitle MPC to be treated as a joint venture
or consortium; and to be evaluated accordingly on the basis of the
members’ collective qualifications when, in fact, the evidence before the
Court suggest otherwise.
This Court in Kilosbayan v. Guingona 46 defined joint venture as "an
association of persons or companies jointly undertaking some
commercial enterprise; generally, all contribute assets and share risks.
It requires a community of interest in the performance of the subject
matter, a right to direct and govern the policy in connection therewith,
and [a] duty, which may be altered by agreement to share both in profit
and losses."
Going back to the instant case, it should be recalled that the automation
Contract with Comelec was not executed by the "consortium" MPC -- or
by MPEI for and on behalf of MPC -- but by MPEI, period. The said
Contract contains no mention whatsoever of any consortium or
members thereof. This fact alone seems to contradict all the
suppositions about a joint undertaking that would normally apply to a
joint venture or consortium: that it is a commercial enterprise involving a
community of interest, a sharing of risks, profits and losses, and so on.
Now let us consider the four bilateral Agreements, starting with the
Memorandum of Agreement between MPEI and WeSolv Open
Computing, Inc., dated March 5, 2003. The body of the MOA consists
of just seven (7) short paragraphs that would easily fit in one page! It
reads as follows:
"1. The parties agree to cooperate in successfully
implementing the Project in the substance and form as may
be most beneficial to both parties and other subcontractors
involved in the Project.
"2. Mega Pacific shall be responsible for any contract
negotiations and signing with the COMELEC and, subject to
the latter’s approval, agrees to give WeSolv an opportunity to
be present at meetings with the COMELEC concerning
WeSolv’s portion of the Project.
"3. WeSolv shall be jointly and severally liable with Mega
Pacific only for the particular products and/or services
supplied by the former for the Project.
"4. Each party shall bear its own costs and expenses relative
to this agreement unless otherwise agreed upon by the
parties.
"5. The parties undertake to do all acts and such other things
incidental to, necessary or desirable or the attainment of the
objectives and purposes of this Agreement.
"6. In the event that the parties fail to agree on the terms and
conditions of the supply of the products and services including
but not limited to the scope of the products and services to be
supplied and payment terms, WeSolv shall cease to be bound
by its obligations stated in the aforementioned paragraphs.
"7. Any dispute arising from this Agreement shall be settled
amicably by the parties whenever possible. Should the parties
be unable to do so, the parties hereby agree to settle their
dispute through arbitration in accordance with the existing
laws of the Republic of the Philippines." (Underscoring
supplied.)
Even shorter is the Memorandum of Agreement between MPEI and SK
C&C Co. Ltd., dated March 9, 2003, the body of which consists of only
six (6) paragraphs, which we quote:
"1. All parties agree to cooperate in achieving the
Consortium’s objective of successfully implementing the
Project in the substance and form as may be most beneficial
to the Consortium members and in accordance w/ the
demand of the RFP.
"2. Mega Pacific shall have full powers and authority to
represent the Consortium with the Comelec, and to enter and
sign, for and in behalf of its members any and all agreement/s
which maybe required in the implementation of the Project.
"3. Each of the individual members of the Consortium shall be
jointly and severally liable with the Lead Firm for the particular
products and/or services supplied by such individual member
for the project, in accordance with their respective undertaking
or sphere of responsibility.
"4. Each party shall bear its own costs and expenses relative
to this agreement unless otherwise agreed upon by the
parties.
"5. The parties undertake to do all acts and such other things
incidental to, necessary or desirable for the attainment of the
objectives and purposes of this Agreement.
"6. Any dispute arising from this Agreement shall be settled
amicably by the parties whenever possible. Should the parties
be unable to do so, the parties hereby agree to settle their
dispute through arbitration in accordance with the existing
laws of the Republic of the Philippines." (Underscoring
supplied.)
It will be noted that the two Agreements quoted above are very similar
in wording. Neither of them contains any specifics or details as to the
exact nature and scope of the parties’ respective undertakings,
performances and deliverables under the Agreement with respect to the
automation project. Likewise, the two Agreements are quite bereft of
pesos-and-centavos data as to the amount of investments each party
contributes, its respective share in the revenues and/or profit from the
Contract with Comelec, and so forth -- all of which are normal for
agreements of this nature. Yet, according to public and private
respondents, the participation of MPEI, WeSolv and SK C&C comprises
fully 90 percent of the entire undertaking with respect to the election
automation project, which is worth about P1.3 billion.
As for Election.com and ePLDT, the separate "Teaming Agreements"
they entered into with MPEI for the remaining 10 percent of the entire
project undertaking are ironically much longer and more detailed than
the MOAs discussed earlier. Although specifically ascribing to them the
role of subcontractor vis-à-vis MPEI as contractor, these Agreements
are, however, completely devoid of any pricing data or payment terms.
Even the appended Schedules supposedly containing prices of goods
and services are shorn of any price data. Again, as mentioned earlier,
based on the terms of their particular Agreements, neither Election.com
nor ePLDT -- with MPEI -- is jointly and severally liable to Comelec.
It is difficult to imagine how these bare Agreements -- especially the
first two -- could be implemented in practice; and how a dispute
between the parties or a claim by Comelec against them, for instance,
could be resolved without lengthy and debilitating litigations. Absent
any clear-cut statement as to the exact nature and scope of the parties’
respective undertakings, commitments, deliverables and covenants,
one party or another can easily dodge its obligation and deny or contest
its liability under the Agreement; or claim that it is the other party that
should have delivered but failed to.
Likewise, in the absence of definite indicators as to the amount of
investments to be contributed by each party, disbursements for
expenses, the parties’ respective shares in the profits and the like, it
seems to the Court that this situation could readily give rise to all kinds
of misunderstandings and disagreements over money matters.
Under such a scenario, it will be extremely difficult for Comelec to
enforce the supposed joint and several liabilities of the members of the
"consortium." The Court is not even mentioning the possibility of a
situation arising from a failure of WeSolv and MPEI to agree on the
scope, the terms and the conditions for the supply of the products and
services under the Agreement. In that situation, by virtue of paragraph
6 of its MOA, WeSolv would perforce cease to be bound by its
obligations -- including its joint and solidary liability with MPEI under the
MOA -- and could forthwith disengage from the project. Effectively,
WeSolv could at any time unilaterally exit from its MOA with MPEI by
simply failing to agree. Where would that outcome leave MPEI and
Comelec?
To the Court, this strange and beguiling arrangement of MPEI with the
other companies does not qualify them to be treated as a consortium or
joint venture, at least of the type that government agencies like the
Comelec should be dealing with. With more reason is it unable to agree
to the proposal to evaluate the members of MPC on a collective basis.
In any event, the MPC members claim to be a joint venture/consortium;
and respondents have consistently been arguing that the IRR for RA
6957, as amended, should be applied to the instant case in order to
allow a collective evaluation of consortium members. Surprisingly,
considering these facts, respondents have not deemed it necessary for
MPC members to comply with Section 5.4 (a) (iii) of the IRR for RA
6957 as amended.
According to the aforementioned provision, if the project proponent is a
joint venture or consortium, the members or participants thereof are
required to submit a sworn statement that, if awarded the contract, they
shall bind themselves to be jointly, severally and solidarily liable for the
project proponent’s obligations thereunder. This provision was
supposed to mirror Section 5 of RA 6957, as amended, which states:
"In all cases, a consortium that participates in a bid must present proof
that the members of the consortium have bound themselves jointly and
severally to assume responsibility for any project. The withdrawal of
any member of the consortium prior to the implementation of the project
could be a ground for the cancellation of the contract." The Court has
certainly not seen any joint and several undertaking by the MPC
members that even approximates the tenor of that which is described
above. We fail to see why respondents should invoke the IRR if it is for
their benefit, but refuse to comply with it otherwise.
B.
DOST Technical Tests Flunked by the Automated Counting
Machines
Let us now move to the second subtopic, which deals with the
substantive issue: the ACM’s failure to pass the tests of the Department
of Science and Technology (DOST).
After respondent "consortium" and the other bidder, TIM, had submitted
their respective bids on March 10, 2003, the Comelec’s BAC -- through
its Technical Working Group (TWG) and the DOST -- evaluated their
technical proposals. Requirements that were highly technical in nature
and that required the use of certain equipment in the evaluation
process were referred to the DOST for testing. The Department
reported thus:
TEST RESULTS MATRIX47
Technical Evaluation of Automated Counting Machine
According to respondents, it was only after the TWG and the DOST had
conducted their separate tests and submitted their respective reports
that the BAC, on the basis of these reports formulated its
comments/recommendations on the bids of the consortium and TIM.
The BAC, in its Report dated April 21, 2003, recommended that the
Phase II project involving the acquisition of automated counting
machines be awarded to MPEI. It said:
"After incisive analysis of the technical reports of the DOST
and the Technical Working Group for Phase II – Automated
Counting Machine, the BAC considers adaptability to
advances in modern technology to ensure an effective and
efficient method, as well as the security and integrity of the
system.
"The results of the evaluation conducted by the TWG and that
of the DOST (14 April 2003 report), would show the apparent
advantage of Mega-Pacific over the other competitor, TIM.
"The BAC further noted that both Mega-Pacific and TIM
obtained some ‘failed marks’ in the technical evaluation. In
general, the ‘failed marks’ of Total Information Management
as enumerated above affect the counting machine itself which
are material in nature, constituting non-compliance to the
RFP. On the other hand, the ‘failed marks’ of Mega-Pacific
are mere formalities on certain documentary requirements
which the BAC may waive as clearly indicated in the Invitation
to Bid.
"In the DOST test, TIM obtained 12 failed marks and mostly
attributed to the counting machine itself as stated earlier.
These are requirements of the RFP and therefore the BAC
cannot disregard the same.
"Mega-Pacific failed in 8 items however these are mostly on
the software which can be corrected by reprogramming the
software and therefore can be readily corrected.
"The BAC verbally inquired from DOST on the status of the
retest of the counting machines of the TIM and was informed
that the report will be forthcoming after the holy week. The
BAC was informed that the retest is on a different parameters
they’re being two different machines being tested. One
purposely to test if previously read ballots will be read again
and the other for the other features such as two sided ballots.
"The said machine and the software therefore may not be
considered the same machine and program as submitted in
the Technical proposal and therefore may be considered an
enhancement of the original proposal.
"Advance information relayed to the BAC as of 1:40 PM of 15
April 2003 by Executive Director Ronaldo T. Viloria of DOST
is that the result of the test in the two counting machines of
TIM contains substantial errors that may lead to the failure of
these machines based on the specific items of the RFP that
DOST has to certify.
OPENING OF FINANCIAL BIDS
"The BAC on 15 April 2003, after notifying the concerned
bidders opened the financial bids in their presence and the
results were as follows:
Mega-Pacific:
Option 1 – Outright purchase: Bid Price if
Php1,248,949,088.00
Option 2 – Lease option:
70% Down payment of cost of hardware or
Php642,755,757.07
Remainder payable over 50 months or a total of
Php642,755,757.07
Discount rate of 15% p.a. or 1.2532% per month.
Total Number of Automated Counting Machine – 1,769 ACMs
(Nationwide)
TIM:
Total Bid Price – Php1,297,860,560.00
Total Number of Automated Counting Machine – 2,272 ACMs
(Mindanao and NCR only)
"Premises considered, it appears that the bid of Mega Pacific
is the lowest calculated responsive bid, and therefore, the
Bids and Awards Committee (BAC) recommends that the
Phase II project re Automated Counting Machine be awarded
to Mega Pacific eSolutions, Inc."48
The BAC, however, also stated on page 4 of its Report: "Based on the
14 April 2003 report (Table 6) of the DOST, it appears that both Mega-
Pacific and TIM (Total Information Management Corporation) failed to
meet some of the requirements. Below is a comparative presentation of
the requirements wherein Mega-Pacific or TIM or both of them failed: x
x x." What followed was a list of "key requirements," referring to
technical requirements, and an indication of which of the two bidders
had failed to meet them.
Failure to Meet the Required Accuracy Rating
The first of the key requirements was that the counting machines were
to have an accuracy rating of at least 99.9995 percent. The BAC
Report indicates that both Mega Pacific and TIM failed to meet this
standard.
The key requirement of accuracy rating happens to be part and parcel
of the Comelec’s Request for Proposal (RFP). The RFP, on page 26,
even states that the ballot counting machines and ballot counting
software "must have an accuracy rating of 99.9995% (not merely
99.995%) or better as certified by a reliable independent testing
agency."
When questioned on this matter during the Oral Argument,
Commissioner Borra tried to wash his hands by claiming that the
required accuracy rating of 99.9995 percent had been set by a private
sector group in tandem with Comelec. He added that the Commission
had merely adopted the accuracy rating as part of the group’s
recommended bid requirements, which it had not bothered to amend
even after being advised by DOST that such standard was
unachievable. This excuse, however, does not in any way lessen
Comelec’s responsibility to adhere to its own published bidding rules,
as well as to see to it that the consortium indeed meets the accuracy
standard. Whichever accuracy rating is the right standard -- whether
99.995 or 99.9995 percent -- the fact remains that the machines of the
so-called "consortium" failed to even reach the lesser of the two. On
this basis alone, it ought to have been disqualified and its bid rejected
outright.
At this point, the Court stresses that the essence of public bidding is
violated by the practice of requiring very high standards or unrealistic
specifications that cannot be met -- like the 99.9995 percent accuracy
rating in this case -- only to water them down after the bid has been
award. Such scheme, which discourages the entry of prospective bona
fide bidders, is in fact a sure indication of fraud in the bidding, designed
to eliminate fair competition. Certainly, if no bidder meets the
mandatory requirements, standards or specifications, then no award
should be made and a failed bidding declared.
Failure of Software to Detect Previously Downloaded Data
Furthermore, on page 6 of the BAC Report, it appears that the
"consortium" as well as TIM failed to meet another key requirement --
for the counting machine’s software program to be able to detect
previously downloaded precinct results and to prevent these from
being entered again into the counting machine. This same
deficiency on the part of both bidders reappears on page 7 of the BAC
Report, as a result of the recurrence of their failure to meet the said key
requirement.
That the ability to detect previously downloaded data at different
canvassing or consolidation levels is deemed of utmost importance can
be seen from the fact that it is repeated three times in the RFP. On
page 30 thereof, we find the requirement that the city/municipal
canvassing system software must be able to detect previously
downloaded precinct results and prevent these from being "inputted"
again into the system. Again, on page 32 of the RFP, we read that the
provincial/district canvassing system software must be able to detect
previously downloaded city/municipal results and prevent these from
being "inputted" again into the system. And once more, on page 35 of
the RFP, we find the requirement that the national canvassing system
software must be able to detect previously downloaded
provincial/district results and prevent these from being "inputted" again
into the system.
Once again, though, Comelec chose to ignore this crucial deficiency,
which should have been a cause for the gravest concern. Come May
2004, unscrupulous persons may take advantage of and exploit such
deficiency by repeatedly downloading and feeding into the computers
results favorable to a particular candidate or candidates. We are thus
confronted with the grim prospect of election fraud on a massive
scale by means of just a few key strokes. The marvels and woes of
the electronic age!
Inability to Print the Audit Trail
But that grim prospect is not all. The BAC Report, on pages 6 and 7,
indicate that the ACMs of both bidders were unable to print the audit
trail without any loss of data. In the case of MPC, the audit trail system
was "not yet incorporated" into its ACMs.
This particular deficiency is significant, not only to this bidding but to the
cause of free and credible elections. The purpose of requiring audit
trails is to enable Comelec to trace and verify the identities of the ACM
operators responsible for data entry and downloading, as well as the
times when the various data were downloaded into the canvassing
system, in order to forestall fraud and to identify the perpetrators.
Thus, the RFP on page 27 states that the ballot counting machines and
ballot counting software must print an audit trail of all machine
operations for documentation and verification purposes. Furthermore,
the audit trail must be stored on the internal storage device and be
available on demand for future printing and verifying. On pages 30-31,
the RFP also requires that the city/municipal canvassing system
software be able to print an audit trail of the canvassing operations,
including therein such data as the date and time the canvassing
program was started, the log-in of the authorized users (the identity of
the machine operators), the date and time the canvass data were
downloaded into the canvassing system, and so on and so forth. On
page 33 of the RFP, we find the same audit trail requirement with
respect to the provincial/district canvassing system software; and again
on pages 35-36 thereof, the same audit trail requirement with respect to
the national canvassing system software.
That this requirement for printing audit trails is not to be lightly brushed
aside by the BAC or Comelec itself as a mere formality or technicality
can be readily gleaned from the provisions of Section 7 of RA 8436,
which authorizes the Commission to use an automated system for
elections.
The said provision which respondents have quoted several times,
provides that ACMs are to possess certain features divided into two
classes: those that the statute itself considers mandatory and other
features or capabilities that the law deems optional. Among those
considered mandatory are "provisions for audit trails"! Section 7 reads
as follows: "The System shall contain the following features: (a) use of
appropriate ballots; (b) stand-alone machine which can count votes and
an automated system which can consolidate the results immediately;
(c) with provisions for audit trails; (d) minimum human intervention;
and (e) adequate safeguard/security measures." (Italics and emphases
supplied.)
In brief, respondents cannot deny that the provision requiring audit trails
is indeed mandatory, considering the wording of Section 7 of RA 8436.
Neither can Respondent Comelec deny that it has relied on the BAC
Report, which indicates that the machines or the software was deficient
in that respect. And yet, the Commission simply disregarded this
shortcoming and awarded the Contract to private respondent, thereby
violating the very law it was supposed to implement.
C.
Inadequacy of Post Facto Remedial Measures
Respondents argue that the deficiencies relating to the detection of
previously downloaded data, as well as provisions for audit trails, are
mere shortcomings or minor deficiencies in software or programming,
which can be rectified. Perhaps Comelec simply relied upon the BAC
Report, which states on page 8 thereof that "Mega Pacific failed in 8
items[;] however these are mostly on the software which can be
corrected by re-programming x x x and therefore can be readily
corrected."
The undersigned ponente’s questions, some of which were addressed
to Commissioner Borra during the Oral Argument, remain unanswered
to this day. First of all, who made the determination that the eight "fail"
marks of Mega Pacific were on account of the software -- was it DOST
or TWG? How can we be sure these failures were not the results of
machine defects? How was it determined that the software could
actually be re-programmed and thereby rectified? Did a qualified
technical expert read and analyze the source code49 for the programs
and conclude that these could be saved and remedied? (Such
determination cannot be done by any other means save by the
examination and analysis of the source code.)
Who was this qualified technical expert? When did he carry out the
study? Did he prepare a written report on his findings? Or did the
Comelec just make a wild guess? It does not follow that all defects in
software programs can be rectified, and the programs saved. In the
information technology sector, it is common knowledge that there are
many badly written programs, with significant programming errors
written into them; hence it does not make economic sense to try to
correct the programs; instead, programmers simply abandon them and
just start from scratch. There’s no telling if any of these programs is
unrectifiable, unless a qualified programmer reads the source code.
And if indeed a qualified expert reviewed the source code, did he also
determine how much work would be needed to rectify the programs?
And how much time and money would be spent for that effort? Who
would carry out the work? After the rectification process, who would
ascertain and how would it be ascertained that the programs have
indeed been properly rectified, and that they would work properly
thereafter? And of course, the most important question to ask: could the
rectification be done in time for the elections in 2004?
Clearly, none of the respondents bothered to think the matter through.
Comelec simply took the word of the BAC as gospel truth, without even
bothering to inquire from DOST whether it was true that the deficiencies
noted could possibly be remedied by re-programming the software.
Apparently, Comelec did not care about the software, but focused only
on purchasing the machines.
What really adds to the Court’s dismay is the admission made by
Commissioner Borra during the Oral Argument that the software
currently being used by Comelec was merely the "demo" version,
inasmuch as the final version that would actually be used in the
elections was still being developed and had not yet been finalized.
It is not clear when the final version of the software would be ready for
testing and deployment. It seems to the Court that Comelec is just
keeping its fingers crossed and hoping the final product would work. Is
there a "Plan B" in case it does not? Who knows? But all these
software programs are part and parcel of the bidding and the Contract
awarded to the Consortium. Why is it that the machines are already
being brought in and paid for, when there is as yet no way of knowing if
the final version of the software would be able to run them properly, as
well as canvass and consolidate the results in the manner required?
The counting machines, as well as the canvassing system, will never
work properly without the correct software programs. There is an old
adage that is still valid to this day: "Garbage in, garbage out." No matter
how powerful, advanced and sophisticated the computers and the
servers are, if the software being utilized is defective or has been
compromised, the results will be no better than garbage. And to think
that what is at stake here is the 2004 national elections -- the very basis
of our democratic life.
Correction of Defects?
To their Memorandum, public respondents proudly appended 19
Certifications issued by DOST declaring that some 285 counting
machines had been tested and had passed the acceptance testing
conducted by the Department on October 8-18, 2003. Among those
tested were some machines that had failed previous tests, but had
undergone adjustments and thus passed re-testing.
Unfortunately, the Certifications from DOST fail to divulge in what
manner and by what standards or criteria the condition, performance
and/or readiness of the machines were re-evaluated and re-appraised
and thereafter given the passing mark. Apart from that fact, the
remedial efforts of respondents were, not surprisingly, apparently
focused again on the machines -- the hardware. Nothing was said or
done about the software -- the deficiencies as to detection and
prevention of downloading and entering previously downloaded data,
as well as the capability to print an audit trail. No matter how many
times the machines were tested and re-tested, if nothing was done
about the programming defects and deficiencies, the same danger of
massive electoral fraud remains. As anyone who has a modicum of
knowledge of computers would say, "That’s elementary!"
And only last December 5, 2003, an Inq7.net news report quoted the
Comelec chair as saying that the new automated poll system would be
used nationwide in May 2004, even as the software for the system
remained unfinished. It also reported that a certain Titus Manuel of the
Philippine Computer Society, which was helping Comelec test the
hardware and software, said that the software for the counting still had
to be submitted on December 15, while the software for the canvassing
was due in early January.
Even as Comelec continues making payments for the ACMs, we keep
asking ourselves: who is going to ensure that the software would be
tested and would work properly?
At any rate, the re-testing of the machines and/or the 100 percent
testing of all machines (testing of every single unit) would not serve to
eradicate the grave abuse of discretion already committed by Comelec
when it awarded the Contract on April 15, 2003, despite the obvious
and admitted flaws in the bidding process, the failure of the "winning
bidder" to qualify, and the inability of the ACMs and the intended
software to meet the bid requirements and rules.
Comelec’s Latest "Assurances" Are Unpersuasive
Even the latest pleadings filed by Comelec do not serve to allay our
apprehensions. They merely affirm and compound the serious
violations of law and gravely abusive acts it has committed. Let us
examine them.
The Resolution issued by this Court on December 9, 2003 required
respondents to inform it as to the number of ACMs delivered and paid
for, as well as the total payment made to date for the purchase thereof.
They were likewise instructed to submit a certification from the DOST
attesting to the number of ACMs tested, the number found to be
defective; and "whether the reprogrammed software has been tested
and found to have complied with the requirements under Republic Act
No. 8436."50
In its "Partial Compliance and Manifestation" dated December 29,
2003, Comelec informed the Court that 1,991 ACMs had already been
delivered to the Commission as of that date. It further certified that it
had already paid the supplier the sum of P849,167,697.41, which
corresponded to 1,973 ACM units that had passed the acceptance
testing procedures conducted by the MIRDC-DOST 51 and which had
therefore been accepted by the poll body.
In the same submission, for the very first time, Comelec also disclosed
to the Court the following:
"The Automated Counting and Canvassing Project involves
not only the manufacturing of the ACM hardware but also the
development of three (3) types of software, which are
intended for use in the following:
1. Evaluation of Technical Bids
2. Testing and Acceptance Procedures
3. Election Day Use."
Purchase of the First Type of Software Without Evaluation
In other words, the first type of software was to be developed solely for
the purpose of enabling the evaluation of the bidder’s technical bid.
Comelec explained thus: "In addition to the presentation of the ACM
hardware, the bidders were required to develop a ‘base’ software
program that will enable the ACM to function properly. Since the
software program utilized during the evaluation of bids is not the actual
software program to be employed on election day, there being two (2)
other types of software program that will still have to be developed and
thoroughly tested prior to actual election day use, defects in the ‘base’
software that can be readily corrected by reprogramming are
considered minor in nature, and may therefore be waived."
In short, Comelec claims that it evaluated the bids and made the
decision to award the Contract to the "winning" bidder partly on the
basis of the operation of the ACMs running a "base" software. That
software was therefore nothing but a sample or "demo" software, which
would not be the actual one that would be used on election day.
Keeping in mind that the Contract involves the acquisition of not just the
ACMs or the hardware, but also the software that would run them, it is
now even clearer that the Contract was awarded without Comelec
having seen, much less evaluated, the final product -- the software that
would finally be utilized come election day. (Not even the "near-final"
product, for that matter).
What then was the point of conducting the bidding, when the software
that was the subject of the Contract was still to be created and could
conceivably undergo innumerable changes before being considered as
being in final form? And that is not all!
No Explanation for Lapses in the Second Type of Software
The second phase, allegedly involving the second type of software, is
simply denominated "Testing and Acceptance Procedures." As best as
we can construe, Comelec is claiming that this second type of software
is also to be developed and delivered by the supplier in connection with
the "testing and acceptance" phase of the acquisition process. The
previous pleadings, though -- including the DOST reports submitted to
this Court -- have not heretofore mentioned any statement, allegation or
representation to the effect that a particular set of software was to be
developed and/or delivered by the supplier in connection with the
testing and acceptance of delivered ACMs.
What the records do show is that the imported ACMs were subjected to
the testing and acceptance process conducted by the DOST. Since the
initial batch delivered included a high percentage of machines that had
failed the tests, Comelec asked the DOST to conduct a 100 percent
testing; that is, to test every single one of the ACMs delivered. Among
the machines tested on October 8 to 18, 2003, were some units that
had failed previous tests but had subsequently been re-tested and had
passed. To repeat, however, until now, there has never been any
mention of a second set or type of software pertaining to the testing and
acceptance process.
In any event, apart from making that misplaced and uncorroborated
claim, Comelec in the same submission also professes (in response to
the concerns expressed by this Court) that the reprogrammed
software has been tested and found to have complied with the
requirements of RA 8436. It reasoned thus: "Since the software
program is an inherent element in the automated counting system, the
certification issued by the MIRDC-DOST that one thousand nine
hundred seventy-three (1,973) units passed the acceptance test
procedures is an official recognition by the MIRDC-DOST that the
software component of the automated election system, which has been
reprogrammed to comply with the provisions of Republic Act No. 8436
as prescribed in the Ad Hoc Technical Evaluation Committee’s ACM
Testing and Acceptance Manual, has passed the MIRDC-DOST tests."
The facts do not support this sweeping statement of Comelec. A
scrutiny of the MIRDC-DOST letter dated December 15, 2003, 52 which it
relied upon, does not justify its grand conclusion. For clarity’s sake, we
quote in full the letter-certification, as follows:
"15 December 2003
"HON. RESURRECCION Z. BORRA
Commissioner-in-Charge
Phase II, Modernization Project
Commission on Elections
Intramuros, Manila
Attention: Atty. Jose M. Tolentino, Jr.
Project Director
"Dear Commissioner Borra:
"We are pleased to submit 11 DOST Test Certifications
representing 11 lots and covering 158 units of automated
counting machines (ACMs) that we have tested from 02-12
December 2003.
"To date, we have tested all the 1,991 units of ACMs, broken
down as follow: (sic)
1st batch - 30 units 4th batch - 438 units
2nd batch - 288 units 5th batch - 438 units
3rd batch - 414 units 6th batch - 383 units
"It should be noted that a total of 18 units have failed the test.
Out of these 18 units, only one (1) unit has failed the retest.
"Thank you and we hope you will find everything in order.
"Very truly yours,
"ROLANDO T. VILORIA, CESO III
Executive Director cum
Chairman, DOST-Technical Evaluation Committee"
Even a cursory glance at the foregoing letter shows that it is completely
bereft of anything that would remotely support Comelec’s contention
that the "software component of the automated election system x x x
has been reprogrammed to comply with" RA 8436, and "has passed the
MIRDC-DOST tests." There is no mention at all of any software
reprogramming. If the MIRDC-DOST had indeed undertaken the
supposed reprogramming and the process turned out to be successful,
that agency would have proudly trumpeted its singular achievement.
How Comelec came to believe that such reprogramming had been
undertaken is unclear. In any event, the Commission is not forthright
and candid with the factual details. If reprogramming has been done,
who performed it and when? What exactly did the process involve?
How can we be assured that it was properly performed? Since the facts
attendant to the alleged reprogramming are still shrouded in mystery,
the Court cannot give any weight to Comelec’s bare allegations.
The fact that a total of 1,973 of the machines has ultimately passed the
MIRDC-DOST tests does not by itself serve as an endorsement of the
soundness of the software program, much less as a proof that it has
been reprogrammed. In the first place, nothing on record shows that the
tests and re-tests conducted on the machines were intended to address
the serious deficiencies noted earlier. As a matter of fact, the MIRDC-
DOST letter does not even indicate what kinds of tests or re-tests were
conducted, their exact nature and scope, and the specific objectives
thereof.53 The absence of relevant supporting documents, combined
with the utter vagueness of the letter, certainly fails to inspire belief or to
justify the expansive confidence displayed by Comelec. In any event, it
goes without saying that remedial measures such as the alleged
reprogramming cannot in any way mitigate the grave abuse of
discretion already committed as early as April 15, 2003.
Rationale of Public Bidding Negated
by the Third Type of Software
Respondent Comelec tries to assuage this Court’s anxiety in these
words: "The reprogrammed software that has already passed the
requirements of Republic Act No. 8436 during the MIRDC-DOST
testing and acceptance procedures will require further customization
since the following additional elements, among other things, will have to
be considered before the final software can be used on election day: 1.
Final Certified List of Candidates x x x 2. Project of Precincts x x x 3.
Official Ballot Design and Security Features x x x 4. Encryption, digital
certificates and digital signatures x x x. The certified list of candidates
for national elective positions will be finalized on or before 23 January
2004 while the final list of projects of precincts will be prepared also on
the same date. Once all the above elements are incorporated in the
software program, the Test Certification Group created by the Ad Hoc
Technical Evaluation Committee will conduct meticulous testing of the
final software before the same can be used on election day. In addition
to the testing to be conducted by said Test Certification Group, the
Comelec will conduct mock elections in selected areas nationwide not
only for purposes of public information but also to further test the final
election day program. Public respondent Comelec, therefore, requests
that it be given up to 16 February 2004 to comply with this
requirement."
The foregoing passage shows the imprudent approach adopted by
Comelec in the bidding and acquisition process. The Commission says
that before the software can be utilized on election day, it will require
"customization" through addition of data -- like the list of candidates,
project of precincts, and so on. And inasmuch as such data will become
available only in January 2004 anyway, there is therefore no perceived
need on Comelec’s part to rush the supplier into producing the final (or
near-final) version of the software before that time. In any case,
Comelec argues that the software needed for the electoral exercise can
be continuously developed, tested, adjusted and perfected, practically
all the way up to election day, at the same time that the Commission is
undertaking all the other distinct and diverse activities pertinent to the
elections.
Given such a frame of mind, it is no wonder that Comelec paid little
attention to the counting and canvassing software during the entire
bidding process, which took place in February-March 2003. Granted
that the software was defective, could not detect and prevent the re-use
of previously downloaded data or produce the audit trail -- aside from its
other shortcomings -- nevertheless, all those deficiencies could still be
corrected down the road. At any rate, the software used for bidding
purposes would not be the same one that will be used on election day,
so why pay any attention to its defects? Or to the Comelec’s own
bidding rules for that matter?
Clearly, such jumbled ratiocinations completely negate the rationale
underlying the bidding process mandated by law.
At the very outset, the Court has explained that Comelec flagrantly
violated the public policy on public biddings (1) by allowing MPC/MPEI
to participate in the bidding even though it was not qualified to do so;
and (2) by eventually awarding the Contract to MPC/MPEI. Now, with
the latest explanation given by Comelec, it is clear that the Commission
further desecrated the law on public bidding by permitting the winning
bidder to change and alter the subject of the Contract (the software), in
effect allowing a substantive amendment without public bidding.
This stance is contrary to settled jurisprudence requiring the strict
application of pertinent rules, regulations and guidelines for public
bidding for the purpose of placing each bidder, actual or potential, on
the same footing. The essence of public bidding is, after all, an
opportunity for fair competition, and a fair basis for the precise
comparison of bids. In common parlance, public bidding aims to "level
the playing field." That means each bidder must bid under the same
conditions; and be subject to the same guidelines, requirements and
limitations, so that the best offer or lowest bid may be determined, all
other things being equal.
Thus, it is contrary to the very concept of public bidding to permit a
variance between the conditions under which bids are invited and those
under which proposals are submitted and approved; or, as in this case,
the conditions under which the bid is won and those under which the
awarded Contract will be complied with. The substantive amendment of
the contract bidded out, without any public bidding -- after the bidding
process had been concluded -- is violative of the public policy on public
biddings, as well as the spirit and intent of RA 8436. The whole point in
going through the public bidding exercise was completely lost. The very
rationale of public bidding was totally subverted by the Commission.
From another perspective, the Comelec approach also fails to make
sense. Granted that, before election day, the software would still have
to be customized to each precinct, municipality, city, district, and so on,
there still was nothing at all to prevent Comelec from requiring
prospective suppliers/bidders to produce, at the very start of the
bidding process, the "next-to-final" versions of the software (the best
software the suppliers had) -- pre-tested and ready to be customized to
the final list of candidates and project of precincts, among others, and
ready to be deployed thereafter. The satisfaction of such requirement
would probably have provided far better bases for evaluation and
selection, as between suppliers, than the so-called demo
software.Respondents contend that the bidding suppliers’ counting
machines were previously used in at least one political exercise with no
less than 20 million voters. If so, it stands to reason that the software
used in that past electoral exercise would probably still be available
and, in all likelihood, could have been adopted for use in this instance.
Paying for machines and software of that category (already tried and
proven in actual elections and ready to be adopted for use) would
definitely make more sense than paying the same hundreds of millions
of pesos for demo software and empty promises of usable programs in
the future.
But there is still another gut-level reason why the approach taken by
Comelec is reprehensible. It rides on the perilous assumption that
nothing would go wrong; and that, come election day, the Commission
and the supplier would have developed, adjusted and "re-programmed"
the software to the point where the automated system could function as
envisioned. But what if such optimistic projection does not materialize?
What if, despite all their herculean efforts, the software now being
hurriedly developed and tested for the automated system performs
dismally and inaccurately or, worse, is hacked and/or manipulated? 54
What then will we do with all the machines and defective software
already paid for in the amount of P849 million of our tax money? Even
more important, what will happen to our country in case of failure of the
automation?
The Court cannot grant the plea of Comelec that it be given until
February 16, 2004 to be able to submit a "certification relative to the
additional elements of the software that will be customized," because
for us to do so would unnecessarily delay the resolution of this case
and would just give the poll body an unwarranted excuse to postpone
the 2004 elections. On the other hand, because such certification will
not cure the gravely abusive actions complained of by petitioners, it will
be utterly useless.
Is this Court being overly pessimistic and perhaps even engaging in
speculation? Hardly. Rather, the Court holds that Comelec should not
have gambled on the unrealistic optimism that the supplier’s software
development efforts would turn out well. The Commission should have
adopted a much more prudent and judicious approach to ensure the
delivery of tried and tested software, and readied alternative courses of
action in case of failure. Considering that the nation’s future is at stake
here, it should have done no less.
Epilogue
Once again, the Court finds itself at the crossroads of our nation’s
history. At stake in this controversy is not just the business of a
computer supplier, or a questionable proclamation by Comelec of one
or more public officials. Neither is it about whether this country should
switch from the manual to the automated system of counting and
canvassing votes. At its core is the ability and capacity of the
Commission on Elections to perform properly, legally and prudently its
legal mandate to implement the transition from manual to automated
elections.
Unfortunately, Comelec has failed to measure up to this historic task.
As stated at the start of this Decision, Comelec has not merely gravely
abused its discretion in awarding the Contract for the automation of the
counting and canvassing of the ballots. It has also put at grave risk the
holding of credible and peaceful elections by shoddily accepting
electronic hardware and software that admittedly failed to pass legally
mandated technical requirements. Inadequate as they are, the
remedies it proffers post facto do not cure the grave abuse of discretion
it already committed (1) on April 15, 2003, when it illegally made the
award; and (2) "sometime" in May 2003 when it executed the Contract
for the purchase of defective machines and non-existent software from
a non-eligible bidder.
For these reasons, the Court finds it totally unacceptable and
unconscionable to place its imprimatur on this void and illegal
transaction that seriously endangers the breakdown of our electoral
system. For this Court to cop-out and to close its eyes to these illegal
transactions, while convenient, would be to abandon its constitutional
duty of safeguarding public interest.
As a necessary consequence of such nullity and illegality, the purchase
of the machines and all appurtenances thereto including the still-to-be-
produced (or in Comelec’s words, to be "reprogrammed") software, as
well as all the payments made therefor, have no basis whatsoever in
law. The public funds expended pursuant to the void Resolution and
Contract must therefore be recovered from the payees and/or from the
persons who made possible the illegal disbursements, without prejudice
to possible criminal prosecutions against them.
Furthermore, Comelec and its officials concerned must bear full
responsibility for the failed bidding and award, and held accountable for
the electoral mess wrought by their grave abuse of discretion in the
performance of their functions. The State, of course, is not bound by
the mistakes and illegalities of its agents and servants.
True, our country needs to transcend our slow, manual and archaic
electoral process. But before it can do so, it must first have a diligent
and competent electoral agency that can properly and prudently
implement a well-conceived automated election system.
At bottom, before the country can hope to have a speedy and fraud-free
automated election, it must first be able to procure the proper
computerized hardware and software legally, based on a transparent
and valid system of public bidding. As in any democratic system, the
ultimate goal of automating elections must be achieved by a legal, valid
and above-board process of acquiring the necessary tools and skills
therefor. Though the Philippines needs an automated electoral process,
it cannot accept just any system shoved into its bosom through
improper and illegal methods. As the saying goes, the end never
justifies the means. Penumbral contracting will not produce enlightened
results.
WHEREFORE, the Petition is GRANTED. The Court hereby declares
NULL and VOID Comelec Resolution No. 6074 awarding the contract
for Phase II of the AES to Mega Pacific Consortium (MPC). Also
declared null and void is the subject Contract executed between
Comelec and Mega Pacific eSolutions (MPEI). 55 Comelec is further
ORDERED to refrain from implementing any other contract or
agreement entered into with regard to this project.
Let a copy of this Decision be furnished the Office of the Ombudsman
which shall determine the criminal liability, if any, of the public officials
(and conspiring private individuals, if any) involved in the subject
Resolution and Contract. Let the Office of the Solicitor General also
take measures to protect the government and vindicate public interest
from the ill effects of the illegal disbursements of public funds made by
reason of the void Resolution and Contract.
SO ORDERED.
G.R. No. 148334               January 21, 2004
ARTURO M. TOLENTINO and ARTURO C. MOJICA, Petitioners,
vs.
COMMISSION ON ELECTIONS, SENATOR RALPH G. RECTO and
SENATOR GREGORIO B. HONASAN, Respondents.
DECISION
CARPIO, J.:
The Case
This is a petition for prohibition to set aside Resolution No. NBC 01-005
dated 5 June 2001 ("Resolution No. 01-005") and Resolution No. NBC
01-006 dated 20 July 2001 ("Resolution No. 01-006") of respondent
Commission on Elections ("COMELEC"). Resolution No. 01-005
proclaimed the 13 candidates elected as Senators in the 14 May 2001
elections while Resolution No. 01-006 declared "official and final" the
ranking of the 13 Senators proclaimed in Resolution No. 01-005.
The Facts
Shortly after her succession to the Presidency in January 2001,
President Gloria Macapagal-Arroyo nominated then Senator Teofisto T.
Guingona, Jr. ("Senator Guingona") as Vice-President. Congress
confirmed the nomination of Senator Guingona who took his oath as
Vice-President on 9 February 2001.
Following Senator Guingona’s confirmation, the Senate on 8 February
2001 passed Resolution No. 84 ("Resolution No. 84") certifying to the
existence of a vacancy in the Senate. Resolution No. 84 called on
COMELEC to fill the vacancy through a special election to be held
simultaneously with the regular elections on 14 May 2001. Twelve
Senators, with a 6-year term each, were due to be elected in that
election.1 Resolution No. 84 further provided that the "Senatorial
candidate garnering the 13th highest number of votes shall serve only
for the unexpired term of former Senator Teofisto T. Guingona, Jr.,"
which ends on 30 June 2004.2
On 5 June 2001, after COMELEC had canvassed the election results
from all the provinces but one (Lanao del Norte), COMELEC issued
Resolution No. 01-005 provisionally proclaiming 13 candidates as the
elected Senators. Resolution No. 01-005 also provided that "the first
twelve (12) Senators shall serve for a term of six (6) years and the
thirteenth (13th) Senator shall serve the unexpired term of three (3)
years of Senator Teofisto T. Guingona, Jr. who was appointed Vice-
President."3 Respondents Ralph Recto ("Recto") and Gregorio
Honasan ("Honasan") ranked 12th and 13th, respectively, in Resolution
No. 01-005.
On 20 June 2001, petitioners Arturo Tolentino and Arturo Mojica
("petitioners"), as voters and taxpayers, filed the instant petition for
prohibition, impleading only COMELEC as respondent. Petitioners
sought to enjoin COMELEC from proclaiming with finality the candidate
for Senator receiving the 13th highest number of votes as the winner in
the special election for a single three-year term seat. Accordingly,
petitioners prayed for the nullification of Resolution No. 01-005 in so far
as it makes a proclamation to such effect.
Petitioners contend that COMELEC issued Resolution No. 01-005
without jurisdiction because: (1) it failed to notify the electorate of the
position to be filled in the special election as required under Section 2
of Republic Act No. 6645 ("R.A. No. 6645");4 (2) it failed to require
senatorial candidates to indicate in their certificates of candidacy
whether they seek election under the special or regular elections as
allegedly required under Section 73 of Batas Pambansa Blg. 881;5 and,
consequently, (3) it failed to specify in the Voters Information Sheet the
candidates seeking election under the special or regular senatorial
elections as purportedly required under Section 4, paragraph 4 of
Republic Act No. 6646 ("R.A. No. 6646").6 Petitioners add that because
of these omissions, COMELEC canvassed all the votes cast for the
senatorial candidates in the 14 May 2001 elections without distinction
such that "there were no two separate Senate elections held
simultaneously but just a single election for thirteen seats, irrespective
of term."7
Stated otherwise, petitioners claim that if held simultaneously, a special
and a regular election must be distinguished in the documentation as
well as in the canvassing of their results. To support their claim,
petitioners cite the special elections simultaneously held with the
regular elections of 13 November 1951 and 8 November 1955 to fill the
seats vacated by Senators Fernando Lopez and Carlos P. Garcia,
respectively, who became Vice-Presidents during their tenures in the
Senate.8 Petitioners point out that in those elections, COMELEC
separately canvassed the votes cast for the senatorial candidates
running under the regular elections from the votes cast for the
candidates running under the special elections. COMELEC also
separately proclaimed the winners in each of those elections.9
Petitioners sought the issuance of a temporary restraining order during
the pendency of their petition.
Without issuing any restraining order, we required COMELEC to
Comment on the petition.
On 20 July 2001, after COMELEC had canvassed the results from all
the provinces, it issued Resolution No. 01-006 declaring "official and
final" the ranking of the 13 Senators proclaimed in Resolution No. 01-
005. The 13 Senators took their oaths of office on 23 July 2001.
In view of the issuance of Resolution No. 01-006, the Court required
petitioners to file an amended petition impleading Recto and Honasan
as additional respondents. Petitioners accordingly filed an amended
petition in which they reiterated the contentions raised in their original
petition and, in addition, sought the nullification of Resolution No. 01-
006.
In their Comments, COMELEC, Honasan, and Recto all claim that a
special election to fill the seat vacated by Senator Guingona was validly
held on 14 May 2001. COMELEC and Honasan further raise
preliminary issues on the mootness of the petition and on petitioners’
standing to litigate. Honasan also claims that the petition, which seeks
the nullity of his proclamation as Senator, is actually a quo warranto
petition and the Court should dismiss the same for lack of jurisdiction.
For his part, Recto, as the 12th ranking Senator, contends he is not a
proper party to this case because the petition only involves the validity
of the proclamation of the 13th placer in the 14 May 2001 senatorial
elections.
The Issues
The following are the issues presented for resolution:
(1) Procedurally –
(a) whether the petition is in fact a petition for quo
warranto over which the Senate Electoral Tribunal is
the sole judge;
(b) whether the petition is moot; and
(c) whether petitioners have standing to litigate.
(2) On the merits, whether a special election to fill a vacant
three-year term Senate seat was validly held on 14 May 2001.
The Ruling of the Court
The petition has no merit.
On the Preliminary Matters
The Nature of the Petition and the Court’s Jurisdiction
A quo warranto proceeding is, among others, one to determine the right
of a public officer in the exercise of his office and to oust him from its
enjoyment if his claim is not well-founded.10 Under Section 17, Article
VI of the Constitution, the Senate Electoral Tribunal is the sole judge of
all contests relating to the qualifications of the members of the Senate.
A perusal of the allegations contained in the instant petition shows,
however, that what petitioners are questioning is the validity of the
special election on 14 May 2001 in which Honasan was elected.
Petitioners’ various prayers are, namely: (1) a "declaration" that no
special election was held simultaneously with the general elections on
14 May 2001; (2) to enjoin COMELEC from declaring anyone as having
won in the special election; and (3) to annul Resolution Nos. 01-005
and 01-006 in so far as these Resolutions proclaim Honasan as the
winner in the special election. Petitioners anchor their prayers on
COMELEC’s alleged failure to comply with certain requirements
pertaining to the conduct of that special election. Clearly then, the
petition does not seek to determine Honasan’s right in the exercise of
his office as Senator. Petitioners’ prayer for the annulment of
Honasan’s proclamation and, ultimately, election is merely incidental to
petitioners’ cause of action. Consequently, the Court can properly
exercise jurisdiction over the instant petition.
On the Mootness of the Petition
COMELEC contends that its proclamation on 5 June 2001 of the 13
Senators and its subsequent confirmation on 20 July 2001 of the
ranking of the 13 Senators render the instant petition to set aside
Resolutions Nos. 01-005 and 01-006 moot and academic.
Admittedly, the office of the writ of prohibition is to command a tribunal
or board to desist from committing an act threatened to be done without
jurisdiction or with grave abuse of discretion amounting to lack or
excess of jurisdiction.11 Consequently, the writ will not lie to enjoin acts
already done.12 However, as an exception to the rule on mootness,
courts will decide a question otherwise moot if it is capable of repetition
yet evading review.13 Thus, in Alunan III v. Mirasol,14 we took
cognizance of a petition to set aside an order canceling the general
elections for the Sangguniang Kabataan ("SK") on 4 December 1992
despite that at the time the petition was filed, the SK election had
already taken place. We noted in Alunan that since the question of the
validity of the order sought to be annulled "is likely to arise in every SK
elections and yet the question may not be decided before the date of
such elections," the mootness of the petition is no bar to its resolution.
This observation squarely applies to the instant case. The question of
the validity of a special election to fill a vacancy in the Senate in relation
to COMELEC’s failure to comply with requirements on the conduct of
such special election is likely to arise in every such election. Such
question, however, may not be decided before the date of the election.
On Petitioners’ Standing
Honasan questions petitioners’ standing to bring the instant petition as
taxpayers and voters because petitioners do not claim that COMELEC
illegally disbursed public funds. Neither do petitioners claim that they
sustained personal injury because of the issuance of Resolution Nos.
01-005 and 01-006.
"Legal standing" or locus standi refers to a personal and substantial
interest in a case such that the party has sustained or will sustain direct
injury because of the challenged governmental act.15 The requirement
of standing, which necessarily "sharpens the presentation of issues,"16
relates to the constitutional mandate that this Court settle only actual
cases or controversies.17 Thus, generally, a party will be allowed to
litigate only when (1) he can show that he has personally suffered some
actual or threatened injury because of the allegedly illegal conduct of
the government; (2) the injury is fairly traceable to the challenged
action; and (3) the injury is likely to be redressed by a favorable
action.18
Applied strictly, the doctrine of standing to litigate will indeed bar the
instant petition. In questioning, in their capacity as voters, the validity of
the special election on 14 May 2001, petitioners assert a harm
classified as a "generalized grievance." This generalized grievance is
shared in substantially equal measure by a large class of voters, if not
all the voters, who voted in that election.19 Neither have petitioners
alleged, in their capacity as taxpayers, that the Court should give due
course to the petition because in the special election held on 14 May
2001 "tax money [was] ‘x x x extracted and spent in violation of specific
constitutional protections against abuses of legislative power’ or that
there [was] misapplication of such funds by COMELEC or that public
money [was] deflected to any improper purpose."20
On the other hand, we have relaxed the requirement on standing and
exercised our discretion to give due course to voters’ suits involving the
right of suffrage.21 Also, in the recent case of Integrated Bar of the
Philippines v. Zamora,22 we gave the same liberal treatment to a
petition filed by the Integrated Bar of the Philippines ("IBP"). The IBP
questioned the validity of a Presidential directive deploying elements of
the Philippine National Police and the Philippine Marines in Metro
Manila to conduct patrols even though the IBP presented "too general
an interest." We held:
[T]he IBP primarily anchors its standing on its alleged responsibility to
uphold the rule of law and the Constitution. Apart from this declaration,
however, the IBP asserts no other basis in support of its locus standi.
The mere invocation by the IBP of its duty to preserve the rule of law
and nothing more, while undoubtedly true, is not sufficient to clothe it
with standing in this case. This is too general an interest which is
shared by other groups and the whole citizenry x x x.
Having stated the foregoing, this Court has the discretion to take
cognizance of a suit which does not satisfy the requirement of legal
standing when paramount interest is involved. In not a few cases, the
court has adopted a liberal attitude on the locus standi of a petitioner
where the petitioner is able to craft an issue of transcendental
significance to the people. Thus, when the issues raised are of
paramount importance to the public, the Court may brush aside
technicalities of procedure. In this case, a reading of the petition shows
that the IBP has advanced constitutional issues which deserve the
attention of this Court in view of their seriousness, novelty and weight
as precedents. Moreover, because peace and order are under constant
threat and lawless violence occurs in increasing tempo, undoubtedly
aggravated by the Mindanao insurgency problem, the legal controversy
raised in the petition almost certainly will not go away. It will stare us in
the face again. It, therefore, behooves the Court to relax the rules on
standing and to resolve the issue now, rather than later.23 (Emphasis
supplied)
We accord the same treatment to petitioners in the instant case in their
capacity as voters since they raise important issues involving their right
of suffrage, considering that the issue raised in this petition is likely to
arise again.
Whether a Special Election for a Single, Three-Year Term
Senatorial Seat was Validly Held on 14 May 2001
Under Section 9, Article VI of the Constitution, a special election may
be called to fill any vacancy in the Senate and the House of
Representatives "in the manner prescribed by law," thus:
In case of vacancy in the Senate or in the House of Representatives, a
special election may be called to fill such vacancy in the manner
prescribed by law, but the Senator or Member of the House of
Representatives thus elected shall serve only for the unexpired term.
(Emphasis supplied)
To implement this provision of the Constitution, Congress passed R.A.
No. 6645, which provides in pertinent parts:
SECTION 1. In case a vacancy arises in the Senate at least eighteen
(18) months or in the House of Representatives at least one (1) year
before the next regular election for Members of Congress, the
Commission on Elections, upon receipt of a resolution of the Senate or
the House of Representatives, as the case may be, certifying to the
existence of such vacancy and calling for a special election, shall hold a
special election to fill such vacancy. If Congress is in recess, an official
communication on the existence of the vacancy and call for a special
election by the President of the Senate or by the Speaker of the House
of Representatives, as the case may be, shall be sufficient for such
purpose. The Senator or Member of the House of Representatives thus
elected shall serve only for the unexpired term.
SECTION 2. The Commission on Elections shall fix the date of the
special election, which shall not be earlier than forty-five (45) days nor
later than ninety (90) days from the date of such resolution or
communication, stating among other things the office or offices to be
voted for: Provided, however, That if within the said period a general
election is scheduled to be held, the special election shall be held
simultaneously with such general election. (Emphasis supplied)
Section 4 of Republic Act No. 7166 subsequently amended Section 2 of
R.A. No. 6645, as follows:
Postponement, Failure of Election and Special Elections. – x x x In
case a permanent vacancy shall occur in the Senate or House of
Representatives at least one (1) year before the expiration of the term,
the Commission shall call and hold a special election to fill the vacancy
not earlier than sixty (60) days nor longer than ninety (90) days after the
occurrence of the vacancy. However, in case of such vacancy in the
Senate, the special election shall be held simultaneously with the next
succeeding regular election. (Emphasis supplied)
Thus, in case a vacancy arises in Congress at least one year before the
expiration of the term, Section 2 of R.A. No. 6645, as amended,
requires COMELEC: (1) to call a special election by fixing the date of
the special election, which shall not be earlier than sixty (60) days nor
later than ninety (90) after the occurrence of the vacancy but in case of
a vacancy in the Senate, the special election shall be held
simultaneously with the next succeeding regular election; and (2) to
give notice to the voters of, among other things, the office or offices to
be voted for.
Did COMELEC, in conducting the special senatorial election
simultaneously with the 14 May 2001 regular elections, comply with the
requirements in Section 2 of R.A. No. 6645?
A survey of COMELEC’s resolutions relating to the conduct of the 14
May 2001 elections reveals that they contain nothing which would
amount to a compliance, either strict or substantial, with the
requirements in Section 2 of R.A. No. 6645, as amended. Thus,
nowhere in its resolutions24 or even in its press releases25 did
COMELEC state that it would hold a special election for a single three-
year term Senate seat simultaneously with the regular elections on 14
May 2001. Nor did COMELEC give formal notice that it would proclaim
as winner the senatorial candidate receiving the 13th highest number of
votes in the special election.
The controversy thus turns on whether COMELEC’s failure, assuming it
did fail, to comply with the requirements in Section 2 of R.A. No. 6645,
as amended, invalidated the conduct of the special senatorial election
on 14 May 2001 and accordingly rendered Honasan’s proclamation as
the winner in that special election void. More precisely, the question is
whether the special election is invalid for lack of a "call" for such
election and for lack of notice as to the office to be filled and the
manner by which the winner in the special election is to be determined.
For reasons stated below, the Court answers in the negative.
COMELEC’s Failure to Give Notice
of the Time of the Special Election Did Not
Negate the Calling of such Election
The calling of an election, that is, the giving notice of the time and place
of its occurrence, whether made by the legislature directly or by the
body with the duty to give such call, is indispensable to the election’s
validity.26 In a general election, where the law fixes the date of the
election, the election is valid without any call by the body charged to
administer the election.27
In a special election to fill a vacancy, the rule is that a statute that
expressly provides that an election to fill a vacancy shall be held at the
next general elections fixes the date at which the special election is to
be held and operates as the call for that election. Consequently, an
election held at the time thus prescribed is not invalidated by the fact
that the body charged by law with the duty of calling the election failed
to do so.28 This is because the right and duty to hold the election
emanate from the statute and not from any call for the election by some
authority29 and the law thus charges voters with knowledge of the time
and place of the election.30
Conversely, where the law does not fix the time and place for holding a
special election but empowers some authority to fix the time and place
after the happening of a condition precedent, the statutory provision on
the giving of notice is considered mandatory, and failure to do so will
render the election a nullity.31
In the instant case, Section 2 of R.A. No. 6645 itself provides that in
case of vacancy in the Senate, the special election to fill such vacancy
shall be held simultaneously with the next succeeding regular election.
Accordingly, the special election to fill the vacancy in the Senate arising
from Senator Guingona’s appointment as Vice-President in February
2001 could not be held at any other time but must be held
simultaneously with the next succeeding regular elections on 14 May
2001. The law charges the voters with knowledge of this statutory
notice and COMELEC’s failure to give the additional notice did not
negate the calling of such special election, much less invalidate it.
Our conclusion might be different had the present case involved a
special election to fill a vacancy in the House of Representatives. In
such a case, the holding of the special election is subject to a condition
precedent, that is, the vacancy should take place at least one year
before the expiration of the term. The time of the election is left to the
discretion of COMELEC subject only to the limitation that it holds the
special election within the range of time provided in Section 2 of R.A.
No. 6645, as amended. This makes mandatory the requirement in
Section 2 of R.A. No. 6645, as amended, for COMELEC to "call x x x a
special election x x x not earlier than 60 days nor longer than 90 days
after the occurrence of the vacancy" and give notice of the office to be
filled. The COMELEC’s failure to so call and give notice will nullify any
attempt to hold a special election to fill the vacancy. Indeed, it will be
well-nigh impossible for the voters in the congressional district involved
to know the time and place of the special election and the office to be
filled unless the COMELEC so notifies them.
No Proof that COMELEC’s
Failure to Give Notice of the Office
to be Filled and the Manner of
Determining the Winner in the Special
Election Misled Voters
The test in determining the validity of a special election in relation to the
failure to give notice of the special election is whether the want of notice
has resulted in misleading a sufficient number of voters as would
change the result of the special election. If the lack of official notice
misled a substantial number of voters who wrongly believed that there
was no special election to fill a vacancy, a choice by a small percentage
of voters would be void.32
The required notice to the voters in the 14 May 2001 special senatorial
election covers two matters. First, that COMELEC will hold a special
election to fill a vacant single three-year term Senate seat
simultaneously with the regular elections scheduled on the same date.
Second, that COMELEC will proclaim as winner the senatorial
candidate receiving the 13th highest number of votes in the special
election. Petitioners have neither claimed nor proved that COMELEC’s
failure to give this required notice misled a sufficient number of voters
as would change the result of the special senatorial election or led them
to believe that there was no such special election.
Instead, what petitioners did is conclude that since COMELEC failed to
give such notice, no special election took place. This bare assertion
carries no value. Section 2 of R.A. No. 6645, as amended, charged
those who voted in the elections of 14 May 2001 with the knowledge
that the vacancy in the Senate arising from Senator Guingona’s
appointment as Vice-President in February 2001 was to be filled in the
next succeeding regular election of 14 May 2001. Similarly, the
absence of formal notice from COMELEC does not preclude the
possibility that the voters had actual notice of the special election, the
office to be voted in that election, and the manner by which COMELEC
would determine the winner. Such actual notice could come from many
sources, such as media reports of the enactment of R.A. No. 6645 and
election propaganda during the campaign.33
More than 10 million voters cast their votes in favor of Honasan, the
party who stands most prejudiced by the instant petition. We simply
cannot disenfranchise those who voted for Honasan, in the absence of
proof that COMELEC’s omission prejudiced voters in the exercise of
their right of suffrage so as to negate the holding of the special election.
Indeed, this Court is loathe to annul elections and will only do so when
it is "impossible to distinguish what votes are lawful and what are
unlawful, or to arrive at any certain result whatever, or that the great
body of the voters have been prevented by violence, intimidation, and
threats from exercising their franchise."34
Otherwise, the consistent rule has been to respect the electorate’s will
and let the results of the election stand, despite irregularities that may
have attended the conduct of the elections.35 This is but to
acknowledge the purpose and role of elections in a democratic society
such as ours, which is:
to give the voters a direct participation in the affairs of their government,
either in determining who shall be their public officials or in deciding
some question of public interest; and for that purpose all of the legal
voters should be permitted, unhampered and unmolested, to cast their
ballot. When that is done and no frauds have been committed, the
ballots should be counted and the election should not be declared null.
Innocent voters should not be deprived of their participation in the
affairs of their government for mere irregularities on the part of the
election officers, for which they are in no way responsible. A different
rule would make the manner and method of performing a public duty of
greater importance than the duty itself.36 (Emphasis in the original)
Separate Documentation and Canvassing
not Required under Section 2 of R.A. No. 6645,
Neither is there basis in petitioners’ claim that the manner by which
COMELEC conducted the special senatorial election on 14 May 2001 is
a nullity because COMELEC failed to document separately the
candidates and to canvass separately the votes cast for the special
election. No such requirements exist in our election laws. What is
mandatory under Section 2 of R.A. No. 6645 is that COMELEC "fix the
date of the election," if necessary, and "state, among others, the office
or offices to be voted for." Similarly, petitioners’ reliance on Section 73
of B.P. Blg. 881 on the filing of certificates of candidacy, and on Section
4(4) of R.A. No. 6646 on the printing of election returns and tally
sheets, to support their claim is misplaced. These provisions govern
elections in general and in no way require separate documentation of
candidates or separate canvass of votes in a jointly held regular and
special elections.
Significantly, the method adopted by COMELEC in conducting the
special election on 14 May 2001 merely implemented the procedure
specified by the Senate in Resolution No. 84. Initially, the original draft
of Resolution No. 84 as introduced by Senator Francisco Tatad
("Senator Tatad") made no mention of the manner by which the seat
vacated by former Senator Guingona would be filled. However, upon
the suggestion of Senator Raul Roco ("Senator Roco"), the Senate
agreed to amend Resolution No. 84 by providing, as it now appears,
that "the senatorial candidate garnering the thirteenth (13th) highest
number of votes shall serve only for the unexpired term of former
Senator Teofisto T. Guingona, Jr." Senator Roco introduced the
amendment to spare COMELEC and the candidates needless
expenditures and the voters further inconvenience, thus:
S[ENATOR] T[ATAD]. Mr. President, I move that we now consider
Proposed Senate Resolution No. 934 [later converted to Resolution No.
84].
T[HE] P[RESIDENT]. Is there any objection? [Silence] There being
none, the motion is approved.
Consideration of Proposed Senate Resolution No. 934 is now in order.
With the permission of the Body, the Secretary will read only the title
and text of the resolution.
T[HE] S[ECRETARY]. Proposed Senate Resolution No. 934 entitled
RESOLUTION CERTIFYING TO THE EXISTENCE OF A VACANCY IN
THE SENATE AND CALLING ON THE COMMISSION ON
ELECTIONS (COMELEC) TO FILL UP SUCH VACANCY THROUGH
ELECTION TO BE HELD SIMULTANEOUSLY WITH THE REGULAR
ELECTION ON MAY 14, 2001 AND THE SENATOR THUS ELECTED
TO SERVE ONLY FOR THE UNEXPIRED TERM
WHEREAS, the Honorable Teofisto T. Guingona, Jr. was elected
Senator of the Philippines in 1998 for a term which will expire on June
30, 2004;
WHEREAS, on February 6, 2001, Her Excellency President Gloria
Macapagal Arroyo nominated Senator Guingona as Vice-President of
the Philippines;
WHEREAS, the nomination of Senator Guingona has been confirmed
by a majority vote of all the members of both House of Congress, voting
separately;
WHEREAS, Senator Guingona will take his Oath of Office as Vice-
President of the Philippines on February 9, 2001;
WHEREAS, Republic Act No. 7166 provides that the election for twelve
(12) Senators, all elective Members of the House of Representatives,
and all elective provincial city and municipal officials shall be held on
the second Monday and every three years thereafter; Now, therefore,
be it
RESOLVED by the Senate, as it is hereby resolved, to certify, as it
hereby certifies, the existence of a vacancy in the Senate and calling
the Commission on Elections (COMELEC) to fill up such vacancy
through election to be held simultaneously with the regular election on
May 14, 2001 and the Senator thus elected to serve only for the
unexpired term.
Adopted,
(Sgd.) FRANCISCO S. TATAD
Senator
S[ENATOR] T[ATAD]. Mr. President, I move for the adoption of this
resolution.
S[ENATOR] O[SMEÑA] (J). Mr. President.
T[HE] P[RESIDENT]. Sen. John H. Osmeña is recognized.
S[ENATOR] O[SMEÑA] (J). Thank you, Mr. President. Will the
distinguished Majority Leader, Chairman of the Committee on Rules,
author of this resolution, yield for a few questions?
S[ENATOR] T[ATAD]. With trepidation, Mr. President. [Laughter]
S[ENATOR] O[SMEÑA] (J). What a way of flattery. [Laughter]
Mr. President, I think I recall that sometime in 1951 or 1953, there was
a special election for a vacant seat in the Senate. As a matter of fact,
the one who was elected in that special election was then
Congressman, later Senator Feli[s]berto Verano.
In that election, Mr. President, the candidates contested the seat. In
other words, the electorate had to cast a vote for a ninth senator –
because at that time there were only eight – to elect a member or
rather, a candidate to that particular seat.
Then I remember, Mr. President, that when we ran after the EDSA
revolution, twice there were 24 candidates and the first 12 were elected
to a six-year term and the next 12 were elected to a three-year term.
My question therefore is, how is this going to be done in this election? to abandon the means it employed in the 13 November 1951 and 8
Is the candidate with the 13th largest number of votes going to be the November 1955 special elections and adopt the method embodied in
one to take a three-year term? Or is there going to be an election for a Resolution No. 84 is but a legitimate exercise of its discretion.
position of senator for the unexpired term of Sen. Teofisto Guingona? Conversely, this Court will not interfere should COMELEC, in
S[ENATOR] T[ATAD]. Mr. President, in this resolution, we are leaving subsequent special senatorial elections, choose to revert to the means
the mechanics to the Commission on Elections. But personally, I would it followed in the 13 November 1951 and 8 November 1955 elections.
like to suggest that probably, the candidate obtaining the 13th largest That COMELEC adopts means that are novel or even disagreeable is
number of votes be declared as elected to fill up the unexpired term of no reason to adjudge it liable for grave abuse of discretion. As we have
Senator Guingona. earlier noted:
S[ENATOR] O[SMEÑA] (J). Is there a law that would allow the The Commission on Elections is a constitutional body. It is intended to
Comelec to conduct such an election? Is it not the case that the play a distinct and important part in our scheme of
vacancy is for a specific office? I am really at a loss. I am rising here government.1âwphi1 In the discharge of its functions, it should not be
because I think it is something that we should consider. I do not know if hampered with restrictions that would be fully warranted in the case of a
we can… No, this is not a Concurrent Resolution. less responsible organization. The Commission may err, so may this
Court also. It should be allowed considerable latitude in devising means
S[ENATOR] T[ATAD]. May we solicit the legal wisdom of the Senate
and methods that will insure the accomplishment of the great objective
President.
for which it was created — free, orderly and honest elections. We may
T[HE] P[RESIDENT]. May I share this information that under Republic not agree fully with its choice of means, but unless these are clearly
Act No. 6645, what is needed is a resolution of this Chamber calling illegal or constitute gross abuse of discretion, this court should not
attention to the need for the holding of a special election to fill up the interfere.39
vacancy created, in this particular case, by the appointment of our
A Word to COMELEC
colleague, Senator Guingona, as Vice President.
The calling of a special election, if necessary, and the giving of notice to
It can be managed in the Commission on Elections so that a slot for the
the electorate of necessary information regarding a special election, are
particular candidate to fill up would be that reserved for Mr. Guingona’s
central to an informed exercise of the right of suffrage. While the
unexpired term. In other words, it can be arranged in such a manner.
circumstances attendant to the present case have led us to conclude
xxxx that COMELEC’s failure to so call and give notice did not invalidate the
S[ENATOR] R[OCO]. Mr. President. special senatorial election held on 14 May 2001, COMELEC should not
T[HE] P[RESIDENT]. Sen. Raul S. Roco is recognized. take chances in future elections. We remind COMELEC to comply
strictly with all the requirements under applicable laws relative to the
S[ENATOR] R[OCO]. May we suggest, subject to a one-minute caucus,
conduct of regular elections in general and special elections in
wordings to the effect that in the simultaneous elections, the 13th placer
particular.
be therefore deemed to be the special election for this purpose. So we
just nominate 13 and it is good for our colleagues. It is better for the WHEREFORE, we DISMISS the petition for lack of merit.
candidates. It is also less expensive because the ballot will be printed SO ORDERED.
and there will be less disfranchisement.
T[HE] P[RESIDENT]. That is right.
S[ENATOR] R[OCO]. If we can just deem it therefore under this
resolution to be such a special election, maybe, we satisfy the
requirement of the law.
T[HE] P[RESIDENT]. Yes. In other words, this shall be a guidance for
the Comelec.
S[ENATOR] R[OCO]. Yes.
T[HE] P[RESIDENT]. – to implement.
S[ENATOR] R[OCO]. Yes. The Comelec will not have the flexibility.
T[HE] P[RESIDENT]. That is right.
S[ENATOR] R[OCO]. We will already consider the 13th placer of the
forthcoming elections that will be held simultaneously as a special
election under this law as we understand it.
T[HE] P[RESIDENT]. Yes. That will be a good compromise, Senator
Roco.
S[ENATOR] R[OCO]. Yes. So if the sponsor can introduce that later,
maybe it will be better, Mr. President.
T[HE] P[RESIDENT]. What does the sponsor say?
S[ENATOR] T[ATAD]. Mr. President, that is a most satisfactory
proposal because I do not believe that there will be anyone running
specifically –
T[HE] P[RESIDENT]. Correct.
S[ENATOR] T[ATAD]. – to fill up this position for three years and
campaigning nationwide.
T[HE] P[RESIDENT]. Actually, I think what is going to happen is the
13th candidate will be running with specific groups.
S[ENATOR] T[ATAD]. Yes. Whoever gets No. 13.
T[HE] P[RESIDENT]. I think we can specifically define that as the intent
of this resolution.
S[ENATOR] T[ATAD]. Subject to style, we accept that amendment and
if there will be no other amendment, I move for the adoption of this
resolution.
xxxx
ADOPTION OF S. RES. NO. 934
If there are no other proposed amendments, I move that we adopt this
resolution.
T[HE] P[RESIDENT]. There is a motion to adopt this resolution. Is there
any objection? [Silence] There being none, the motion is approved.37
Evidently, COMELEC, in the exercise of its discretion to use means and
methods to conduct the special election within the confines of R.A. No.
6645, merely chose to adopt the Senate’s proposal, as embodied in
Resolution No. 84. This Court has consistently acknowledged and
affirmed COMELEC’s wide latitude of discretion in adopting means to
carry out its mandate of ensuring free, orderly, and honest elections
subject only to the limitation that the means so adopted are not illegal
or do not constitute grave abuse of discretion.38 COMELEC’s decision
G.R. No. 127685 July 23, 1998
BLAS F. OPLE, petitioner,
vs.
RUBEN D. TORRES, ALEXANDER AGUIRRE, HECTOR
VILLANUEVA, CIELITO HABITO, ROBERT BARBERS, CARMENCITA
REODICA, CESAR SARINO, RENATO VALENCIA, TOMAS P.
AFRICA, HEAD OF THE NATIONAL COMPUTER CENTER and
CHAIRMAN OF THE COMMISSION ON AUDIT, respondents.
PUNO, J.:
The petition at bar is a commendable effort on the part of Senator Blas
F. Ople to prevent the shrinking of the right to privacy, which the
revered Mr. Justice Brandeis considered as "the most comprehensive
of rights and the right most valued by civilized men." 1 Petitioner Ople
prays that we invalidate Administrative Order No. 308 entitled "Adoption
of a National Computerized Identification Reference System" on two
important constitutional grounds, viz: one, it is a usurpation of the
power of Congress to legislate, and two, it impermissibly intrudes on
our citizenry's protected zone of privacy. We grant the petition for the
rights sought to be vindicated by the petitioner need stronger barriers
against further erosion.
A.O. No. 308 was issued by President Fidel V. Ramos On December
12, 1996 and reads as follows:
ADOPTION OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM
WHEREAS, there is a need to provide Filipino
citizens and foreign residents with the facility to
conveniently transact business with basic service
and social security providers and other government
instrumentalities;
WHEREAS, this will require a computerized system
to properly and efficiently identify persons seeking
basic services on social security and reduce, if not
totally eradicate fraudulent transactions and
misrepresentations;
WHEREAS, a concerted and collaborative effort
among the various basic services and social security
providing agencies and other government
intrumentalities is required to achieve such a
system;
NOW, THEREFORE, I, FIDEL V. RAMOS,
President of the Republic of the Philippines, by
virtue of the powers vested in me by law, do hereby
direct the following:
Sec. 1. Establishment of a National Compoterized
Identification Reference System. A decentralized
Identification Reference System among the key
basic services and social security providers is
hereby established.
Sec. 2. Inter-Agency Coordinating Committee. An
Inter-Agency Coordinating Committee (IACC) to
draw-up the implementing guidelines and oversee
the implementation of the System is hereby created,
chaired by the Executive Secretary, with the
following as members:
Head, Presidential Management Staff
Secretary, National Economic Development
Authority
Secretary, Department of the Interior and Local
Government
Secretary, Department of Health
Administrator, Government Service Insurance
System,
Administrator, Social Security System,
Administrator, National Statistics Office
Managing Director, National Computer Center.
Sec. 3. Secretariat. The National Computer Center
(NCC) is hereby designated as secretariat to the
IACC and as such shall provide administrative and
technical support to the IACC.
Sec. 4. Linkage Among Agencies. The Population
Reference Number (PRN) generated by the NSO
shall serve as the common reference number to
establish a linkage among concerned agencies. The
IACC Secretariat shall coordinate with the different
Social Security and Services Agencies to establish
the standards in the use of Biometrics Technology
and in computer application designs of their
respective systems.
Sec. 5. Conduct of Information Dissemination
Campaign. The Office of the Press Secretary, in
coordination with the National Statistics Office, the
GSIS and SSS as lead agencies and other
concerned agencies shall undertake a massive tri-
media information dissemination campaign to
educate and raise public awareness on the
importance and use of the PRN and the Social
Security Identification Reference.
Sec. 6. Funding. The funds necessary for the
implementation of the system shall be sourced from
the respective budgets of the concerned agencies.
Sec. 7. Submission of Regular Reports. The NSO,
GSIS and SSS shall submit regular reports to the
Office of the President through the IACC, on the
status of implementation of this undertaking.
Sec. 8. Effectivity. This Administrative Order shall
take effect immediately.
DONE in the City of Manila, this 12th day of
December in the year of Our Lord, Nineteen
Hundred and Ninety-Six.
(SGD.) FIDEL V. RAMOS
A.O. No. 308 was published in four newspapers of general circulation
on January 22, 1997 and January 23, 1997. On January 24, 1997,
petitioner filed the instant petition against respondents, then Executive
Secretary Ruben Torres and the heads of the government agencies,
who as members of the Inter-Agency Coordinating Committee, are
charged with the implementation of A.O. No. 308. On April 8, 1997, we
issued a temporary restraining order enjoining its implementation.
Petitioner contends:
A. THE ESTABLISNMENT OF A NATIONAL
COMPUTERIZED IDENTIFICATION REFERENCE
SYSTEM REQUIRES A LEGISLATIVE ACT. THE
ISSUANCE OF A.O. NO. 308 BY THE PRESIDENT
OF THE REPUBLIC OF THE PHILIPPINES IS,
THEREFORE, AN UNCONSTITUTIONAL
USURPATION OF THE LEGISLATIVE POWERS
OF THE CONGRESS OF THE REPUBLIC OF THE
PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY
THE PRESIDENT FOR THE IMPLEMENTATION
OF A.O. NO. 308 IS AN UNCONSTITUTIONAL
USURPATION OF THE EXCLUSIVE RIGHT OF
CONGRESS TO APPROPRIATE PUBLIC FUNDS
FOR EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308
INSIDIOUSLY LAYS THE GROUNDWORK FOR A
SYSTEM WHICH WILL VIOLATE THE BILL OF
RIGHTS ENSHRINED IN THE CONSTITUTION. 2
Respondents counter-argue:
A. THE INSTANT PETITION IS NOT A
JUSTICIABLE CASE AS WOULD WARRANT A
JUDICIAL REVIEW;
B. A.O. NO. 308 [1996] WAS ISSUED WITHIN THE
EXECUTIVE AND ADMINISTRATIVE POWERS OF
THE PRESIDENT WITHOUT ENCROACHING ON
THE LEGISLATIVE POWERS OF CONGRESS;
C. THE FUNDS NECESSARY FOR THE
IMPLEMENTATION OF THE IDENTIFICATION
REFERENCE SYSTEM MAY BE SOURCED FROM
THE BUDGETS OF THE CONCERNED
AGENCIES;
D. A.O. NO. 308 [1996] PROTECTS AN
INDIVIDUAL'S INTEREST IN PRIVACY. 3
We now resolve.
I
As is usual in constitutional litigation, respondents raise the threshold
issues relating to the standing to sue of the petitioner and the
justiciability of the case at bar. More specifically, respondents aver that
petitioner has no legal interest to uphold and that the implementing
rules of A.O. No. 308 have yet to be promulgated.
These submissions do not deserve our sympathetic ear. Petitioner Ople
is a distinguished member of our Senate. As a Senator, petitioner is
possessed of the requisite standing to bring suit raising the issue that
the issuance of A.O. No. 308 is a usurpation of legislative power. 4 As
taxpayer and member of the Government Service Insurance System
(GSIS), petitioner can also impugn the legality of the misalignment of
public funds and the misuse of GSIS funds to implement A.O. No. 308.
5
The ripeness for adjudication of the Petition at bar is not affected by the
fact that the implementing rules of A.O. No. 308 have yet to be
promulgated. Petitioner Ople assails A.O. No. 308 as invalid per se and
as infirmed on its face. His action is not premature for the rules yet to
be promulgated cannot cure its fatal defects. Moreover, the
respondents themselves have started the implementation of A.O. No.
308 without waiting for the rules. As early as January 19, 1997,
respondent Social Security System (SSS) caused the publication of a
notice to bid for the manufacture of the National Identification (ID) card.
6 Respondent Executive Secretary Torres has publicly announced that
representatives from the GSIS and the SSS have completed the
guidelines for the national identification system. 7 All signals from the
respondents show their unswerving will to implement A.O. No. 308 and
we need not wait for the formality of the rules to pass judgment on its
constitutionality. In this light, the dissenters insistence that we tighten
the rule on standing is not a commendable stance as its result would be
to throttle an important constitutional principle and a fundamental right.
II
We now come to the core issues. Petitioner claims that A.O. No. 308 is
not a mere administrative order but a law and hence, beyond the power
of the President to issue. He alleges that A.O. No. 308 establishes a
system of identification that is all-encompassing in scope, affects the
life and liberty of every Filipino citizen and foreign resident, and more
particularly, violates their right to privacy.
Petitioner's sedulous concern for the Executive not to trespass on the
lawmaking domain of Congress is understandable. The blurring of the
demarcation line between the power of the Legislature to make laws
and the power of the Executive to execute laws will disturb their
delicate balance of power and cannot be allowed. Hence, the exercise
by one branch of government of power belonging to another will be
given a stricter scrutiny by this Court.
The line that delineates Legislative and Executive power is not
indistinct. Legislative power is "the authority, under the Constitution, to
make laws, and to alter and repeal them." 8 The Constitution, as the will
of the people in their original, sovereign and unlimited capacity, has
vested this power in the Congress of the Philippines. 9 The grant of
legislative power to Congress is broad, general and comprehensive. 10
The legislative body possesses plenary power for all purposes of civil
government. 11 Any power, deemed to be legislative by usage and
tradition, is necessarily possessed by Congress, unless the Constitution
has lodged it elsewhere. 12 In fine, except as limited by the
Constitution, either expressly or impliedly, legislative power embraces
all subjects and extends to matters of general concern or common
interest. 13
While Congress is vested with the power to enact laws, the President
executes the laws. 14 The executive power is vested in the Presidents.
15 It is generally defined as the power to enforce and administer the
laws. 16 It is the power of carrying the laws into practical operation and
enforcing their due observance. 17
As head of the Executive Department, the President is the Chief
Executive. He represents the government as a whole and sees to it that
all laws are enforced by the officials and employees of his department.
18 He has control over the executive department, bureaus and offices.
This means that he has the authority to assume directly the functions of
the executive department, bureau and office or interfere with the
discretion of its officials.19 Corollary to the power of control, the
President also has the duty of supervising the enforcement of laws for
the maintenance of general peace and public order. Thus, he is granted
administrative power over bureaus and offices under his control to
enable him to discharge his duties effectively. 20
Administrative power is concerned with the work of applying policies
and enforcing orders as determined by proper governmental organs. 21
It enables the President to fix a uniform standard of administrative
efficiency and check the official conduct of his agents. 22 To this end,
he can issue administrative orders, rules and regulations.
Prescinding from these precepts, we hold that A.O. No. 308 involves a
subject that is not appropriate to be covered by an administrative order.
An administrative order is:
Sec. 3. Administrative Orders. — Acts of the
President which relate to particular aspects of
governmental operation in pursuance of his duties
as administrative head shall be promulgated in
administrative orders. 23
An administrative order is an ordinance issued by the
President which relates to specific aspects in the
administrative operation of government. It must be in harmony
with the law and should be for the sole purpose of
implementing the law and carrying out the legislative policy.
24 We reject the argument that A.O. No. 308 implements the
legislative policy of the Administrative Code of 1987. The
Code is a general law and "incorporates in a unified document
the major structural, functional and procedural principles of
governance." 25 and "embodies changes in administrative
structure and procedures designed to serve the
people." 26 The Code is divided into seven (7) Books: Book I
deals with Sovereignty and General Administration, Book II
with the Distribution of Powers of the three branches of
Government, Book III on the Office of the President, Book IV
on the Executive Branch, Book V on Constitutional
Commissions, Book VI on National Government Budgeting,
and Book VII on Administrative Procedure. These Books
contain provisions on the organization, powers and general
administration of the executive, legislative and judicial
branches of government, the organization and administration
of departments, bureaus and offices under the executive
branch, the organization and functions of the Constitutional
Commissions and other constitutional bodies, the rules on the
national government budget, as well as guideline for the
exercise by administrative agencies of quasi-legislative and
quasi-judicial powers. The Code covers both the internal
administration of government, i.e, internal organization,
personnel and recruitment, supervision and discipline, and the
effects of the functions performed by administrative officials
on private individuals or parties outside government. 27
It cannot be simplistically argued that A.O. No. 308 merely implements
the Administrative Code of 1987. It establishes for the first time a
National Computerized Identification Reference System. Such a
System requires a delicate adjustment of various contending state
policies — the primacy of national security, the extent of privacy interest
against dossier-gathering by government, the choice of policies, etc.
Indeed, the dissent of Mr. Justice Mendoza states that the A.O. No. 308
involves the all-important freedom of thought. As said administrative
order redefines the parameters of some basic rights of our citizenry vis-
a-vis the State as well as the line that separates the administrative
power of the President to make rules and the legislative power of
Congress, it ought to be evident that it deals with a subject that should
be covered by law.
Nor is it correct to argue as the dissenters do that A.D. No. 308 is not a
law because it confers no right, imposes no duty, affords no
proctection, and creates no office. Under A.O. No. 308, a citizen cannot
transact business with government agencies delivering basic services
to the people without the contemplated identification card. No citizen
will refuse to get this identification card for no one can avoid dealing
with government. It is thus clear as daylight that without the ID, a citizen
will have difficulty exercising his rights and enjoying his privileges.
Given this reality, the contention that A.O. No. 308 gives no right and
imposes no duty cannot stand.
Again, with due respect, the dissenting opinions unduly expand the
limits of administrative legislation and consequently erodes the plenary
power of Congress to make laws. This is contrary to the established
approach defining the traditional limits of administrative legislation. As
well stated by Fisher: ". . . Many regulations however, bear directly on
the public. It is here that administrative legislation must he restricted in
its scope and application. Regulations are not supposed to be a
substitute for the general policy-making that Congress enacts in the
form of a public law. Although administrative regulations are entitled to
respect, the authority to prescribe rules and regulations is not an
independent source of power to make laws." 28
III
Assuming, arguendo, that A.O. No. 308 need not be the subject of a
law, still it cannot pass constitutional muster as an administrative
legislation because facially it violates the right to privacy. The essence
of privacy is the "right to be let alone." 29 In the 1965 case of Griswold
v. Connecticut, 30 the United States Supreme Court gave more
substance to the right of privacy when it ruled that the right has a
constitutional foundation. It held that there is a right of privacy which
can be found within the penumbras of the First, Third, Fourth, Fifth and
Ninth Amendments, 31 viz:
Specific guarantees in the Bill of Rights have
penumbras formed by emanations from these
guarantees that help give them life and substance . .
. various guarantees create zones of privacy. The
right of association contained in the penumbra of the
First Amendment is one, as we have seen. The
Third Amendment in its prohibition against the
quartering of soldiers "in any house" in time of
peace without the consent of the owner is another
facet of that privacy. The Fourth Amendment
explicitly affirms the ''right of the people to be secure
in their persons, houses and effects, against
unreasonable searches and seizures." The Fifth
Amendment in its Self-Incrimination Clause enables
the citizen to create a zone of privacy which
government may not force him to surrender to his
detriment. The Ninth Amendment provides: "The
enumeration in the Constitution, of certain rights,
shall not be construed to deny or disparage others
retained by the people."
In the 1968 case of Morfe v. Mutuc, 32 we adopted the
Griswold ruling that there is a constitutional right to privacy.
Speaking thru Mr. Justice, later Chief Justice, Enrique
Fernando, we held:
x x x           x x x          x x x
The Griswold case invalidated a Connecticut statute
which made the use of contraceptives a criminal
 offence on the ground of its amounting to an
unconstitutional invasion of the right of privacy of
married persons; rightfully it stressed "a relationship
lying within the zone of privacy created by several
fundamental constitutional guarantees." It has wider
implications though. The constitutional right to
privacy has come into its own.
So it is likewise in our jurisdiction. The right to
privacy as such is accorded recognition
independently of its identification with liberty; in
itself, it is fully deserving of constitutional protection.
The language of Prof. Emerson is particularly apt:
"The concept of limited government has always
included the idea that governmental powers stop
short of certain intrusions into the personal life of the
citizen. This is indeed one of the basic distinctions
between absolute and limited government. Ultimate
and pervasive control of the individual, in all aspects
of his life, is the hallmark of the absolute state. In
contrast, a system of limited government safeguards
a private sector, which belongs to the individual,
firmly distinguishing it from the public sector, which
the state can control. Protection of this private sector
— protection, in other words, of the dignity and
integrity of the individual — has become increasingly
important as modern society has developed. All the
forces of a technological age — industrialization,
urbanization, and organization — operate to narrow
the area of privacy and facilitate intrusion into it. In
modern terms, the capacity to maintain and support
this enclave of private life marks the difference
between a democratic and a totalitarian society."
Indeed, if we extend our judicial gaze we will find that the right of
privacy is recognized and enshrined in several provisions of our
Constitution. 33 It is expressly recognized in section 3 (1) of the Bill of
Rights:
Sec. 3. (1) The privacy of communication and
correspondence shall be inviolable except upon
lawful order of the court, or when public safety or
order requires otherwise as prescribed by law.
Other facets of the right to privacy are protectad in various
provisions of the Bill of Rights, viz: 34
Sec. 1. No person shall be deprived of life, liberty, or
property without due process of law, nor shall any
person be denied the equal protection of the laws.
Sec. 2. The right of the people to be secure in their
persons, houses papers, and effects against
unreasonable searches and seizures of whatever
nature and for any purpose shall be inviolable, and
no search warrant or warrant of arrest shall issue
except upon probable cause to be determined
personally by the judge after examination under oath
or affirmation of the complainant and the witnesses
he may produce, and particularly describing the
place to be searched and the persons or things to
be seized.
x x x           x x x          x x x
Sec. 6. The liberty of abode and of changing the
same within the limits prescribed by law shall not be
impaired except upon lawful order of the court.
Neither shall the right to travel be impaired except in
the interest of national security, public safety, or
public health as may be provided by law.
x x x           x x x          x x x
Sec. 8. The right of the people, including those
employed in the public and private sectors, to form
unions, associations, or societies for purposes not
contrary to law shall not be abridged.
Sec. 17. No person shall be compelled to be a
witness against himself.
Zones of privacy are likewise recognized and protected in our laws. The
Civil Code provides that "[e]very person shall respect the dignity,
personality, privacy and peace of mind of his neighbors and other
persons" and punishes as actionable torts several acts by a person of
meddling and prying into the privacy of another. 35 It also holds a
public officer or employee or any private individual liable for damages
for any violation of the rights and liberties of another person, 36 and
recognizes the privacy of letters and other private communications. 37
The Revised Penal Code makes a crime the violation of secrets by an
officer, 38 the revelation of trade and industrial secrets, 39 and trespass
to dwelling. 40 Invasion of privacy is an offense in special laws like the
Anti-Wiretapping Law, 41 the Secrecy of Bank Deposits Act 42 and the
Intellectual Property Code. 43 The Rules of Court on privileged
communication likewise recognize the privacy of certain information. 44
Unlike the dissenters, we prescind from the premise that the right to
privacy is a fundamental right guaranteed by the Constitution, hence, it
is the burden of government to show that A.O. No. 308 is justified by
some compelling state interest and that it is narrowly drawn. A.O. No.
308 is predicated on two considerations: (1) the need to provides our
citizens and foreigners with the facility to conveniently transact
business with basic service and social security providers and other
government instrumentalities and (2) the need to reduce, if not totally
eradicate, fraudulent transactions and misrepresentations by persons
seeking basic services. It is debatable whether these interests are
compelling enough to warrant the issuance of A.O. No. 308. But what is
not arguable is the broadness, the vagueness, the overbreadth of A.O.
No. 308 which if implemented will put our people's right to privacy in
clear and present danger.
The heart of A.O. No. 308 lies in its Section 4 which provides for a
Population Reference Number (PRN) as a "common reference number
to establish a linkage among concerned agencies" through the use of
"Biometrics Technology" and "computer application designs."
Biometry or biometrics is "the science of the applicatin of statistical
methods to biological facts; a mathematical analysis of biological data."
45 The term "biometrics" has evolved into a broad category of
technologies which provide precise confirmation of an individual's
identity through the use of the individual's own physiological and
behavioral characteristics. 46 A physiological characteristic is a
relatively stable physical characteristic such as a fingerprint, retinal
scan, hand geometry or facial features. A behavioral characteristic is
influenced by the individual's personality and includes voice print,
signature and keystroke. 47 Most biometric idenfication systems use a
card or personal identificatin number (PIN) for initial identification. The
biometric measurement is used to verify that the individual holding the
card or entering the PIN is the legitimate owner of the card or PIN. 48
A most common form of biological encoding is finger-scanning where
technology scans a fingertip and turns the unique pattern therein into
an individual number which is called a biocrypt. The biocrypt is stored in
computer data banks 49 and becomes a means of identifying an
individual using a service. This technology requires one's fingertip to be
scanned every time service or access is provided. 50 Another method
is the retinal scan. Retinal scan technology employs optical technology
to map the capillary pattern of the retina of the eye. This technology
produces a unique print similar to a finger print. 51 Another biometric
method is known as the "artificial nose." This device chemically
analyzes the unique combination of substances excreted from the skin
of people. 52 The latest on the list of biometric achievements is the
thermogram. Scientists have found that by taking pictures of a face
using infra-red cameras, a unique heat distribution pattern is seen. The
different densities of bone, skin, fat and blood vessels all contribute to
the individual's personal "heat signature." 53
In the last few decades, technology has progressed at a galloping rate.
Some science fictions are now science facts. Today, biometrics is no
longer limited to the use of fingerprint to identify an individual. It is a
new science that uses various technologies in encoding any and all
biological characteristics of an individual for identification. It is
noteworthy that A.O. No. 308 does not state what specific biological
characteristics and what particular biometrics technology shall be used
to identify people who will seek its coverage. Considering the banquest
of options available to the implementors of A.O. No. 308, the fear that it
threatens the right to privacy of our people is not groundless.
A.O. No. 308 should also raise our antennas for a further look will show
that it does not state whether encoding of data is limited to biological
information alone for identification purposes. In fact, the Solicitor
General claims that the adoption of the Identification Reference System
will contribute to the "generation of population data for development
planning." 54 This is an admission that the PRN will not be used solely
for identification but the generation of other data with remote relation to
the avowed purposes of A.O. No. 308. Clearly, the indefiniteness of
A.O. No. 308 can give the government the roving authority to store and
retrieve information for a purpose other than the identification of the
individual through his PRN.
The potential for misuse of the data to be gathered under A.O. No. 308
cannot be undarplayed as the dissenters do. Pursuant to said
administrative order, an individual must present his PRN everytime he
deals with a government agency to avail of basic services and security.
His transactions with the government agency will necessarily be
recorded — whether it be in the computer or in the documentary file of
the agency. The individual's file may include his transactions for loan
availments, income tax returns, statement of assets and liabilities,
reimbursements for medication, hospitalization, etc. The more frequent
the use of the PRN, the better the chance of building a huge formidable
informatin base through the electronic linkage of the files. 55 The data
may be gathered for gainful and useful government purposes; but the
existence of this vast reservoir of personal information constitutes a
covert invitation to misuse, a temptation that may be too great for some
of our authorities to resist. 56
We can even grant, arguendo, that the computer data file will be limited
to the name, address and other basic personal infomation about the
individual. 57 Even that hospitable assumption will not save A.O. No.
308 from constitutional infirmity for again said order does not tell us in
clear and categorical terms how these information gathered shall he
handled. It does not provide who shall control and access the data,
under what circumstances and for what purpose. These factors are
essential to safeguard the privacy and guaranty the integrity of the
information. 58 Well to note, the computer linkage gives other
government agencies access to the information. Yet, there are no
controls to guard against leakage of information. When the access code
of the control programs of the particular computer system is broken, an
intruder, without fear of sanction or penalty, can make use of the data
for whatever purpose, or worse, manipulate the data stored within the
system. 59
It is plain and we hold that A.O. No. 308 falls short of assuring that
personal information which will be gathered about our people will only
be processed for unequivocally specified purposes. 60 The lack of
proper safeguards in this regard of A.O. No. 308 may interfere with the
individual's liberty of abode and travel by enabling authorities to track
down his movement; it may also enable unscrupulous persons to
access confidential information and circumvent the right against self-
incrimination; it may pave the way for "fishing expeditions" by
government authorities and evade the right against unreasonable
searches and seizures. 61 The possibilities of abuse and misuse of the
PRN, biometrics and computer technology are accentuated when we
consider that the individual lacks control over what can be read or
placed on his ID, much less verify the correctness of the data encoded.
62 They threaten the very abuses that the Bill of Rights seeks to
prevent. 63
The ability of sophisticated data center to generate a comprehensive
cradle-to-grave dossier on an individual and transmit it over a national
network is one of the most graphic threats of the computer revolution.
64 The computer is capable of producing a comprehensive dossier on
individuals out of information given at different times and for varied
purposes. 65 It can continue adding to the stored data and keeping the
information up to date. Retrieval of stored date is simple. When
information of a privileged character finds its way into the computer, it
can be extracted together with other data on the subject. 66 Once
extracted, the information is putty in the hands of any person. The end
of privacy begins.
Though A.O. No. 308 is undoubtedly not narrowly drawn, the dissenting
opinions would dismiss its danger to the right to privacy as speculative
and hypothetical. Again, we cannot countenance such a laidback
posture. The Court will not be true to its role as the ultimate guardian of
the people's liberty if it would not immediately smother the sparks that
endanger their rights but would rather wait for the fire that could
consume them.
We reject the argument of the Solicitor General that an individual has a
reasonable expectation of privacy with regard to the Natioal ID and the
use of biometrics technology as it stands on quicksand. The
reasonableness of a person's expectation of privacy depends on a two-
part test: (1) whether by his conduct, the individual has exhibited an
expectation of privacy; and (2) whether this expectation is one that
society recognizes as reasonable. 67 The factual circumstances of the
case determines the reasonableness of the expectation. 68 However,
other factors, such as customs, physical surroundings and practices of
a particular activity, may serve to create or diminish this expectation. 69
The use of biometrics and computer technology in A.O. No. 308 does
not assure the individual of a reasonable expectation of privacy. 70 As
technology advances, the level of reasonably expected privacy
decreases. 71 The measure of protection granted by the reasonable
expectation diminishes as relevant technology becomes more widely
accepted. 72 The security of the computer data file depends not only on
the physical inaccessibility of the file but also on the advances in
hardware and software computer technology. A.O. No. 308 is so widely
drawn that a minimum standard for a reasonable expectation of privacy,
regardless of technology used, cannot be inferred from its provisions.
The rules and regulations to be by the IACC cannot remedy this fatal
defect. Rules and regulations merely implement the policy of the law or
order. On its face, A.O. No. gives the IACC virtually infettered discretion
to determine the metes and bounds of the ID System.
Nor do your present laws prvide adequate safeguards for a reasonable
expectation of privacy. Commonwealth Act. No. 591 penalizes the
disclosure by any person of data furnished by the individual to the NSO
with imprisonment and fine. 73 Republic Act. No. 1161 prohibits public
disclosure of SSS employment records and reports. 74 These laws,
however, apply to records and data with the NSO and the SSS. It is not
clear whether they may be applied to data with the other government
agencies forming part of the National ID System. The need to clarify the
penal aspect of A.O. No. 308 is another reason why its enactment
should be given to Congress.
Next, the Solicitor General urges us to validate A.O. No. 308's
abridgment of the right of privacy by using the rational relationship test.
75 He stressed that the purposes of A.O. No. 308 are: (1) to streamline
and speed up the implementation of basic government services, (2)
eradicate fraud by avoiding duplication of services, and (3) generate
population data for development planning. He cocludes that these
purposes justify the incursions into the right to privacy for the means
are rationally related to the end. 76
We are not impressed by the argument. In Morfe v. Mutuc, 77 we
upheld the constitutionality of R.A. 3019, the Anti-Graft and Corrupt
Practices Act, as a valid police power measure. We declared that the
law, in compelling a public officer to make an annual report disclosing
his assets and liabilities, his sources of income and expenses, did not
infringe on the individual's right to privacy. The law was enacted to
promote morality in public administration by curtailing and minimizing
the opportunities for official corruption and maintaining a standard of
honesty in the public service. 78
The same circumstances do not obtain in the case at bar. For one, R.A.
3019 is a statute, not an administrative order. Secondly, R.A. 3019 itself
is sufficiently detailed. The law is clear on what practices were
prohibited and penalized, and it was narrowly drawn to avoid abuses.
IN the case at bar, A.O. No. 308 may have been impelled by a worthy
purpose, but, it cannot pass constitutional scrutiny for it is not narrowly
drawn. And we now hod that when the integrity of a fundamental right is
at stake, this court will give the challenged law, administrative order,
rule or regulation a stricter scrutiny. It will not do for the authorities to
invoke the presumption of regularity in the performance of official
duties. Nor is it enough for the authorities to prove that their act is not
irrational for a basic right can be diminished, if not defeated, even when
the government does not act irrationally. They must satisfactorily show
the presence of compelling state interests and that the law, rule or
regulation is narrowly drawn to preclude abuses. This approach is
demanded by the 1987 Constitution whose entire matrix is designed to
protect human rights and to prevent authoritarianism. In case of doubt,
the least we can do is to lean towards the stance that will not put in
danger the rights protected by the Constitutions.
The case of Whalen v. Roe 79 cited by the Solicitor General is also off-
line. In Whalen, the United States Supreme Court was presented with
the question of whether the State of New York could keep a centralized
computer record of the names and addresses of all persons who
obtained certain drugs pursuant to a doctor's prescription. The New
York State Controlled Substance Act of 1972 required physicians to
identify parties obtaining prescription drugs enumerated in the statute,
i.e., drugs with a recognized medical use but with a potential for abuse,
so that the names and addresses of the patients can be recorded in a
centralized computer file of the State Department of Health. The
plaintiffs, who were patients and doctors, claimed that some people
might decline necessary medication because of their fear that the
computerized data may be readily available and open to public
disclosure; and that once disclosed, it may stigmatize them as drug
addicts. 80 The plaintiffs alleged that the statute invaded a
constitutionally protected zone of privacy, i.e., the individual interest in
avoiding disclosure of personal matters, and the interest in
independence in making certain kinds of important decisions. The U.S.
Supreme Court held that while an individual's interest in avoiding
disclosuer of personal matter is an aspect of the right to privacy, the
statute did not pose a grievous threat to establish a constitutional
violation. The Court found that the statute was necessary to aid in the
enforcement of laws designed to minimize the misuse of dangerous
drugs. The patient-identification requirement was a product of an
orderly and rational legislative decision made upon recommmendation
by a specially appointed commission which held extensive hearings on
the matter. Moreover, the statute was narrowly drawn and contained
numerous safeguards against indiscriminate disclosure. The statute laid
down the procedure and requirements for the gathering, storage and
retrieval of the informatin. It ebumerated who were authorized to access
the data. It also prohibited public disclosure of the data by imposing
penalties for its violation. In view of these safeguards, the infringement
of the patients' right to privacy was justified by a valid exercise of police
power. As we discussed above, A.O. No. 308 lacks these vital
safeguards.
Even while we strike down A.O. No. 308, we spell out in neon that the
Court is not per se agains the use of computers to accumulate, store,
process, retvieve and transmit data to improve our bureaucracy.
Computers work wonders to achieve the efficiency which both
government and private industry seek. Many information system in
different countries make use of the computer to facilitate important
social objective, such as better law enforcement, faster delivery of
public services, more efficient management of credit and insurance
programs, improvement of telecommunications and streamlining of
financial activities. 81 Used wisely, data stored in the computer could
help good administration by making accurate and comprehensive
information for those who have to frame policy and make key decisions.
82
The benefits of the computer has revolutionized information
technology. It developed the internet, 83 introduced the concept of
cyberspace 84 and the information superhighway where the individual,
armed only with his personal computer, may surf and search all kinds
and classes of information from libraries and databases connected to
the net.
In no uncertain terms, we also underscore that the right to privacy does
not bar all incursions into individual privacy. The right is not intended to
stifle scientific and technological advancements that enhance public
service and the common good. It merely requires that the law be
narrowly focused 85 and a compelling interest justify such intrusions. 86
Intrusions into the right must be accompanied by proper safeguards
and well-defined standards to prevent unconstitutional invasions. We
reiterate that any law or order that invades individual privacy will be
subjected by this Court to strict scrutiny. The reason for this stance was
laid down in Morfe v. Mutuc, to wit:
The concept of limited government has always
included the idea that governmental powers stop
short of certain intrusions into the personal life of the
citizen. This is indeed one of the basic disctinctions
between absolute and limited government. Ultimate
and pervasive control of the individual, in all aspects
of his life, is the hallmark of the absolute state. In
contrast, a system of limited government safeguards
a private sector, which belongs to the individual,
firmly distinguishing it from the public sector, which
the state can control. Protection of this private sector
— protection, in other words, of the dignity and
integrity of the individual — has become increasingly
important as modern society has developed. All the
forces of a technological age — industrialization,
urbanization, and organization — operate to narrow
the area of privacy and facilitate intrusion into it. In
modern terms, the capacity to maintain and support
this enclave of private life marks the difference
between a democratic and a totalitarian society. 87
IV
The right to privacy is one of the most threatened rights of man living in
a mass society. The threats emanate from various sources —
governments, journalists, employers, social scientists, etc. 88 In th case
at bar, the threat comes from the executive branch of government
which by issuing A.O. No. 308 pressures the people to surrender their
privacy by giving information about themselves on the pretext that it will
facilitate delivery of basic services. Given the record-keeping power of
the computer, only the indifferent fail to perceive the danger that A.O.
No. 308 gives the government the power to compile a devastating
dossier against unsuspecting citizens. It is timely to take note of the
well-worded warning of Kalvin, Jr., "the disturbing result could be that
everyone will live burdened by an unerasable record of his past and his
limitations. In a way, the threat is that because of its record-keeping,
the society will have lost its benign capacity to forget." 89 Oblivious to
this counsel, the dissents still say we should not be too quick in
labelling the right to privacy as a fundamental right. We close with the
statement that the right to privacy was not engraved in our Constitution
for flattery.
IN VIEW WHEREOF, the petition is granted and Adminisrative Order
No. 308 entitled "Adoption of a National Computerized Identification
Reference System" declared null and void for being unconstitutional.
SO ORDERED.  provisions and becomes an arbitrary flexing of the
Separate Opinions
ROMERO, J., separate opinion;
What marks offs man from a beast?
Aside from the distinguishing physical characteristics, man is a rational
being, one who is endowed with intellect which allows him to apply
reasoned judgment to problems at hand; he has the innate spiritual
faculty which can tell, not only what is right but, as well, what is moral
and ethical. Because of his sensibilities, emotions and feelings, he
likewise possesses a sense of shame. In varying degrees as dictated
by diverse cultures, he erects a wall between himself and the outside
world wherein he can retreat in solitude, protecting himself from prying
eyes and ears and their extensions, whether form individuals, or much
later, from authoritarian intrusions.
Piercing through the mists of time, we find the original Man and Woman
defying the injunction of God by eating of the forbidden fruit in the
Garden. And when their eyes were "opened" forthwith "they sewed fig
leaves together, and made themselves aprons." 1 Down the corridors of
time, we find man fashioning "fig leaves" of sorts or setting up figurative
walls, the better to insulate themselves from the rest of humanity.
Such vague stirrings of the desire "to be left alone," considered "anti-
social" by some, led to the development of the concept of "privacy,"
unheard of among beasts. Different branches of science, have made
their own studies of this craving of the human spirit — psychological,
anthropological sociological and philosophical, with the legal finally
giving its imprimatur by elevating it to the status ofa right, specifically a
private right.
Initially recognized as an aspect of tort law, it created giant waves in
legal circles with the publication in the Harvard Law Review 2 of the
trail-blazing article, "The Right to Privacy," by Samuel D. Warren and
Louis D. Brandeis.
Whether viewed as a personal or a property right, it found its way in
Philippine Constitutions and statutes; this, in spite of the fact that
Philippine culture can hardly be said to provide a fertile field for the
burgeoning of said right. In fact, our lexicographers have yet to coin a
word for it in the Filipino language. Customs and practices, being what
they have always been, Filipinos think it perfectly natural and in good
taste to inquire into each other's intimate affairs.
One has only to sit through a televised talk show to be convinced that
what passes for wholesome entertainment is actually an invasion into
one's private life, leaving the interviewee embarrassed and outraged by
turns.
With the overarching influence of common law and the recent advent of
the Information Age with its high-tech devices, the right to privacy has
expanded to embrace its public law aspect. The Bill of Rights of our
evolving Charters, a direct transplant from that of the United States,
contains in essence facets of the right to privacy which constitute
limitations on the far-reaching powers of government.
So terrifying are the possibilities of a law such as Administrative Order
No. 308 in making inroads into the private lives of the citizens, a virtual
Big Brother looking over our shoulder, that it must, without delay, be
"slain upon sight" before our society turns totalitarian with each of us, a
mindless robot.
I, therefore, VOTE for the nullification of A.O. No. 308.
VITUG, J., separate opinion;
One can appreciate the concern expressed by my esteemed colleague,
Mr. Justice Reynato S. Puno, echoing that of the petitioner, the
Honorable Blas F. Ople, on the issuance of Administrative Order No.
308 by the President of the Philippines and the dangers its
implementation could bring. I find it hard, nevertheless, to peremptorily
assume at this time that the administrative order will be misused and to
thereby ignore the possible benefits that can be derived from, or the
merits of, a nationwide computerized identification reference system.
The great strides and swift advances in technology render it
inescapable that one day we will, at all events, have to face up with the
reality of seeing extremely sophisticated methods of personal
identification and any attempt to stop the inevitable may either be short-
lived or even futile. The imperatives, I believe, would instead be to now
install specific safeguards and control measures that may be calculated
best to ward-off probable ill effects of any such device. Here, it may be
apropos to recall the pronouncement of this Court in People vs.
Nazario 1 that —
As a rule, a statute or [an] act may be said to be
vague when it lacks comprehensible standards that
men "of common intelligence must necessarily
guess at its meaning and differ as to its application."
It is repugnant to the Constitution in two respects:
(1) it violates due process for failure to accord
persons, especially the parties targeted by it, fair
notice of the conduct to avoid; and (2) it leaves law
enforcers unbridled discretion in carrying out its
Government muscle. 2
Administrative Order No. 308 appears to be so extensively
drawn that could, indeed, allow unbridled options to become
available to its implementors beyond the reasonable comfort
of the citizens and of residents alike.
Prescinding from the foregoing, and most importantly to this instance,
the subject covered by the questioned administrative order can have
far-reaching consequences that can tell on all individuals, their liberty
and privacy, that, to my mind, should make it indispensable and
appropriate to have the matter specifically addressed by the Congress
of the Philippines, the policy-making body of our government, to which
the task should initially belong and to which the authority to formulate
and promulgate that policy is constitutionally lodged.
WHEREFORE, I vote for the nullification of Administrative Order No.
308 for being an undue and impermissible exercise of legislative power
by the Executive.
PANGANIBAN, J., separate opinion;
I concur only in the result and only on the ground that an executive
issuance is not legally sufficient to establish an all-encompassing
computerized system of identification in the country. The subject matter
contained in AO 308 is beyond the powers of the President to regulate
without a legislative enactment.
I reserve judgmeht on the issue of wherher a national ID system is an
infringement of the constitutional right to privacy or the freedom of
thought until after Congress passes, if ever, a law to this effect. Only
then, and upon the filing of a proper petition, may the provisions of the
statute be scrutinized by the judiciary to determine their constitutional
foundation. Until such time, the issue is premature; and any decision
thereon, speculative and academic. 1
Be that as it may, the scholarly discussions of Justices Romero, Puno,
Kapunan and Mendoza on the constitutional right to privacy and
freedom of thought may stil become useful guides to our lawmakers,
when and if Congress should deliberate on a bill establishing a national
identification system.
Let it be noted that this Court, as shown by the voting of the justices,
has not definitively ruled on these points. The voting is decisive only on
the need for the appropriate legislation, and it is only on this ground that
the petition is granted by this Court.
 
KAPUNAN, J., dissenting opinion;
The pioneering efforts of the executive to adopt a national
computerized identification reference system has met fierce opposition.
It has spun dark predictions of sinister government ploys to tamper with
the citizen's right to privacy and ominous forecasts of a return to
authoritarianism. Lost in the uproar, however, is the simple fact that
there is nothing in the whole breadth and lenght of Administrative Order
No. 308 that suggests a taint constitutional infirmity.
A.O. No. 308 issued by President Fidel V. Ramos on 12 December
1996 reads:
ADMTNISTRATIVE ORDER NO. 308
ADOPTION OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM
WHEREAS, there is a need to provide Filipino
citizens and foreign residents with the facility to
conveniently transact business with basic services
and social security providers and other government
instrumentalities;
WHEREAS, this will require a computerized system
to properly and efficiently identify persons seeking
basic services and social security and reduce, if not
totally eradicate, fraudulent transactions and
misrepresentations;
WHEREAS, a concerted and collaborative effort
among the various basic services and social security
providing agencies and other government
instrumentalities is required to achieve such a
system;
NOW, THEREFORE, I, FIDEL V. RAMOS,
President of the Repubic of the Philippines, by virtue
of the powers vested in me by law, do hereby direct
the following:
Sec. 1 Establishment of a National Computerized
Identification Reference System. A decentralized
Identification Reference System among the key
basic services and social security providers is
hereby established.
Sec. 2. Inter-Agency Coordinating Committee. An
Inter-Agency Coordinating Committee (IACC) to
draw-up the implementing guidelines and oversee
the implementation of the System is hereby created,
chaired by the Executive Secretary, with the
following as members:
Head Presidential Management Staff
Secretary, National Economic Development
Authority
Secretary, Department of the Interior and
Local Government
Secretary, Department of Health
Administrator, Government Service
Insurance System
Administrator, Social Security System
Administrator, National Statistics Office
Managing Director, National Computer
Center
Sec. 3. Secretariat. The National Computer Center
(NCC) is hereby designated as secretariat to the
IACC and as such shall provide administrative and
technical support to the IACC.
Sec. 4. Linkage Among Agencies. The Population
Reference Number (PRN) generated by the NSO
shall serve as the common reference number to
establish a linkage among concerned agencies. The
IACC Secretariat shall coordinate with the different
Social Security and Services Agencies to establish
the standards in the use of Biometrics Technology
and in computer application designs of their
respective systems.
Sec. 5. Conduct of Information Dissemination
Campaign. The Office of the Press Secretary, in
coordination with the National Statistics Offices, the
GSIS and SSS as lead agencies and other
concerned agencies shall undertake a massive tri-
media information dissemination campaign to
educate and raise public awareness on the
importance and use of the PRN and the Social
Security Identification Reference.
Sec. 6. Funding. The funds necessary for the
implementation of the system shall be sourced from
the respective budgets of the concerned agencies.
Sec. 7. Submission of Regular Reports. The NSO,
GSIS and SSS shall submit regular reports to the
Office of the President, through the IACC, on the
status of implementation of this undertaking.
Sec. 8 Effectivity. This Administartive Order shall
take effect immediately.
DONE in the City of Manila, this 12th day of
December in the year of Our Lord, Nineteen
Hundred and Ninety-Six.
In seeking to strike down A.O. No. 308 as unconstitutional, petitioner
argues:
A. THE ESTABLISHMENT OF NATIONAL
COMPUTERIZED IDENTIFICATION REFERENCE
SYSTEM REQUIRES A LEGISLATIVE ACT. THE
ISSUACE OF A.O. NO. 308 BY THE PRESIDENT
OF THE REPUBLIC OF THE PHILIPPINES IS,
THEREFORE, AN UNCONSTITUTIONAL
USURPATION OF THE LEGISLATIVE POWERS
OF THE CONGRESS OF THE REPUBLIC OF THE
PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY
THE PRESIDENT FOR THE IMPLEMENTATION
OF A.O. NO. 308 IS AN UNCONSTITUTIONAL
USURPATION OF THE EXCLUSIVE RIGHT OF
CONGRESS TO APPROPRIATE PUBLIC FUNDS
FOR EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308
INSIDIOUSLY LAYS THE GROUNDWORK FOR A
SYSTEM WHICH WILL VIOLATE THE BILL OF
RIGHTS ENSHRINED IN THE CONSTITUTION.
The National Computerized Identification Reference system to which
the NSO, GSIS and SSS are linked as lead members of the IACC is
intended to establish uniform standards for ID cards isssued by key
government agencies (like the SSS) 1 for the "efficient identification of
persons." 2 Under the new system, only one reliable and tamper-proof
I.D. need be presented by the cardholder instead of several
identification papers such as passports and driver's license, 3 to able to
transact with government agencies. The improved ID can be used to
facilitate public transactions such as:
1. Payment of SSS and GSIS benefits
2. Applications for driver's license, BIR TIN, passport,
marriage license, death certificate, NBI and police
clearances, and business permits
3. Availment of Medicare services in hospitals
4. Availment of welfare services
5. Application for work/employment
6. Pre-requisite for Voter's ID. 4
The card may also be used for private transactions such as:
1. Opening of bank accounts
2. Encashment of checks
3. Applications for loans, credit cards, water, power,
telephones, pagers, etc.
4. Purchase of stocks
5. Application for work/employment
6. Insurance claims
7. Receipt of payments, checks, letters, valuables, etc.
5
The new identification system would tremendously improve and uplift
public service in our country to the benefit of Filipino citizens and
resident aliens. It would promote, facilitate and speed up legitimate
transactions with government offices as well as with private and
business entities. Experience tells us of the constant delays and
inconveniences the public has to suffer in availing of basic public
services and social security benefits because of inefficient and not too
reliable means of identification of the beneficiaries.
Thus, in the "Primer on the Social Security Card and Administrative
Order No. 308" issued by the SSS, a lead agency in the implementation
of the said order, the following salient features are mentioned:
1. A.O. 308 merely establishes the standards for I.D.
cards issued by key government agencies such as
SSS and GSIS.
2. It does not establish a national I.D. system neither
does it require a national I.D. card for every person.
3. The use of the I.D. is voluntary.
 4. The I.D. is not required for delivery of any
government service. Everyone has the right to basic
government services as long as he is qualified under
existing laws.
5. The LD. cannot and will not in any way be used to
prevent one to travel.
6. There will be no discrimination Non-holders of the
improved I.D. are still entitled to the same services
but will be subjected to the usual rigid identification
and verification beforehand.
I
The issue that must first be hurdled is: was the issuance of A.O. No.
308 an exercise by the President of legislative power properly
belonging to Congress?
It is not.
The Administrative Code of 1987 has unequivocally vested the
President with quasi-legislative powers in the form of executive orders,
administrative orders, proclamations, memorandum orders and
circulars and general or special orders. 6 An administrative order, like
the one under which the new identification system is embodied, has its
peculiar meaning under the 1987 Administrative Code:
Sec. 3. Administrative Orders. — Acts of the
President which relate to particular aspects of
governmental operations in pursuance of his duties
as administrative head shall be promulgated in
administrative orders.
The National Computerized Identification Reference System was
established pursuant to the aforaquoted provision precisely because its
principal purpose, as expressly stated in the order, is to provide the
people with "the facility to conveniently transact business" with the
various government agencies providing basic services. Being the
"administrative head," it is unquestionably the responsibility of the
President to find ways and means to improve the government
bureaucracy, and make it more professional, efficient and reliable,
specially those government agencies and instrumentalities which
provide basic services and which the citizenry constantly transact with,
like the Government Service Insurance System (GSIS), Social Security
System (SSS) and National Statistics Office (NSO). The national
computerized ID system is one such advancement. To emphasize, the
new identification reference system is created to streamline the
bureaucracy, cut the red tape and ultimately achieve administrative
efficiency. The project, therefore, relates to, is an appropriate subject
and falls squarely within the ambit of the Chief Executive's
administrative power under which, in order to successfully carry out his
administrative duties, he has been granted by law quasi-legislative
powers, quoted above.
Understandably, strict adherence to the doctrine of separation of power
spawns differences of opinion. For we cannot divide the branches of
government into water-tight compartment. Even if such is possible, it is
neither desirable nor feasible. Bernard Schwartz, in his work
Administrative Law, A Casebook, thus states:
To be sure, if we think of the separation of powers
as carrying out the distinction between legislation
and administration with mathematical precision and
as dividing the branches of government into
watertight compartments, we would probably have
to conclude that any exercise of lawmaking authority
by an agency is automatically invalid. Such a
rigorous application of the constitutional doctrine is
neither desirable nor feasible; the only absolute
separation that has ever been possible was that in
the theoretical writings of a Montesquieu, who
looked across at foggy England from his sunny
Gascon vineyards and completely misconstrued
what he saw. 7
A mingling of powers among the three branches of government is not a
novel concept. This blending of powers has become necessary to
properly address the complexities brought about by a rapidly
developing society and which the traditional branches of government
have difficulty coping with. 8
It has been said that:
The true meaning of the general doctrine of the
separation of powers seems to be that the whole
power of one department should not be exercised by
the same hands which possess the whole power of
either of the other department, and that no one
department ought to possess directly or indirectly an
overruling influence over the others. And it has been
that this doctrine should be applied only to the
powers which because of their nature are assigned
by the constitution itself to one of the departments
exclusively. Hence, it does not necessarily follow
that an entire and complete separation is either
desirable of was ever intended, for such a complete
separation would be impracticable if not impossible;
there may be-and frequently are-areas in which
executive, legislative, and judicial powers blend or
overlap; and many officers whose duties cannot be
exclusively placed under any one of these heads.
The courts have perceived the necessity of avoiding
a narrow construction of a state constitutional
provision for the division of the powers of the
government into three distinct departments, for it is
impractical to view the provision from the standpoint
of a doctrinaire. Thus, the modern view of
separation of powers rejects the metaphysical
abstractions and reverts instead to more pragmatic,
flexible, functional approach, giving recognition to
the fact that then may be a certain degree of
blending or admixture of the three powers of the
government. Moreover, the doctrine of separation of
powers has never been strictly or rigidly applied, and
indeed could not be, to all the ramifications of state
or national governments; government would prove
abortive if it were attempted to follow the policy of
separation to the letter. 9
In any case A.O. No. 308 was promulgated by the President pursuant
to the quasi-legislative powers expressly granted to him by law and in
accordance with his duty as administrative head. Hence, the contention
that the President usurped the legislative prerogatives of Congress has
no firm basis.
II
Having resolved that the President has the authority and prerogative to
issue A.O. No. 308, I submit that it is premature for the Court to
determine the constitutionality or unconstitutionality of the National
Computerized Identification Reference System.
Basic in constitutional law is the rule that before the court assumes
jurisdiction over and decide constitutional issues, the following
requisites must first be satisfied:
1) there must be an actual case or controversy involving a conflict of
rights susceptible of judicial determination;
2) the constitutional question must be raised by a proper party;
3) the constitutional question must be raised at the earliest opportunity;
and
4) the resolution of the constitutional question must be necessary to the
resolution of the case. 10
In this case, it is evident that the first element is missing. Judicial
intervention calls for an actual case or controversy which is defined as
"an existing case or controversy that is appropriate or ripe for
determination, not conjectural or anticipatory." 11 Justice Isagani A.
Cruz further expounds that "(a) justifiable controversy is thus
distinguished from a difference or dispute of a hypothetical or abstract
character or from one that is academic or moot. The controversy must
be definite and concrete, touching the legal relations of parties having
adverse legal interests. It must be a real and substantial controversy
admitting of special relief through a decree that is conclusive in
character, as distinguished from an opinion advising what the law would
be upon a hypothetical state of facts. . . ." 12 A.O. No. 308 does not
create any concrete or substantial controversy. It provides the general
framework of the National Computerized Identification Reference
System and lays down the basic standards (efficiency, convenience
and prevention of fraudulent transactions) for its cretion. But as
manifestly indicated in the subject order, it is the Inter-Agency
Coordinating Committee (IACC) which is tasked to research, study and
formulate the guidelines and parameters for the use of Biometrics
Technology and in computer application designs that will and define
give substance to the new system. 13 This petition is, thus, premature
considering that the IACC is still in the process of doing the leg work
and has yet to codify and formalize the details of the new system.
The majority opines that the petition is ripe for adjudication even without
the promulgation of the necessary guidelines in view of the fact that
respondents have begun implementation of A.O. No. 308. The SSS, in
particular, has started advertising in newspapers the invitation to bid for
the production of the I.D. cards. 14
I beg to disagree. It is not the new system itself that is intended to be
implemented in the invitation to bid but only the manufacture of the I.D.
cards. Biometrics Technology is not and cannot be used in the I.D.
cards as no guidelines therefor have yet been laid down by the IACC.
Before the assailed system can be set up, it is imperative that the
guidelines be issued first.
III
Without the essential guidelines, the principal contention for invalidating
the new identification reference system — that it is an impermissible
encroachment on the constitutionally recognized right to privacy — is
plainly groundless. There is nothing in A.O. No. 308 to serve as
sufficient basis for a conclusion that the new system to be evolved
violates the right to privacy. Said order simply provides the system's
general framework. Without the concomitant guidelines, which would
spell out in detail how this new identification system would work, the
perceived violation of the right to privacy amounts to nothing more than
mere surmise and speculation.
What has caused much of the hysteria over the National Computerized
Identification Reference System is the possible utilization of Biometrics
Technology which refers to the use of autnomated matching of
physiological or behavioral characteristics to identify a person that
would violated the citizen's constitutionally protected right to privacy.
The majority opinion has enumerated various forms and methods of
Biometrics Technology which if adopted in the National Computaized
Identification Reference System would seriously threaten the right to
privacy. Among which are biocrypt retinal scan, artificial nose and
thermogram. The majority also points to certain alleged deficiencies of
A O. No. 308. Thus:
1) A.O. No. 308 does not specify the particular
Biometrics Technology that shall be used for the
new identification system.
2) The order dots not state whether encoding of data
is limited to biological information alone for
identification purposes;
3) There is no provision as to who shall control and
access the data, under what circumstances and for
what purpose; and
4) There are no controls to guard against leakage of
information, thus heightening the potential for
misuse and abuse.
We should not be overwhelmed by the mere mention of the Biometrics
Technology and its alleged, yet unfounded "far-reaching effects."
There is nothing in A.O. No. 308, as it is worded, to suggest that the
advanced methods of the Biometrics Technology that may pose danger
to the right of privacy will be adopted.
The standards set in A.O. No. 308 for the adoption of the new system
are clear-cut and unequivocably spelled out in the "WHEREASES" and
body of the order, namely, the need to provide citizens and foreign
residents with the facility to conveniently transact business with basic
service and social security providers and other government
instrumentalities; the computerized system is intended to properly and
efficiently identify persons seeking basic services or social security and
reduce, if not totally eradicate fraudulent transactions and
misreprentation; the national identification reference system is
established among the key basic services and social security providers;
and finally, the IACC Secretariat shall coordinate with different Social
Security and Services Agencies to establish the standards in the use of
Biometrics Technology. Consequently, the choice of the particular form
and extent of Biometrics Technology that will be applied and the
parameters for its use (as will be defined in the guidelines) will
necessarily and logically be guided, limited and circumscribed by the
afore-stated standards. The fear entertained by the majority on the
potential dangers of this new technology is thus securedly allayed by
the specific limitations set by the above-mentioned standards. More
than this, the right to privacy is well-esconced in and directly protected
by various provisions of the Bill of Rights, the Civil Code, the Revised
Penal Code, and certain laws, all so painstakingly and resourcefully
catalogued in the majority opinion. Many of these laws provide
penalties for their violation in the form of imprisonment, fines, or
damages. These laws will serve as powerful deterrents not only in the
establishment of any administrative rule that will violate the
constitutionally protected right to privacy, but also to would-be
transgressors of such right.
Relevant to this case is the ruling of the U.S. Supreme Court in Whalen
v. Roe. 15 In that case, a New York statute was challenged for
requiring physicians to identify patients obtaining prescription drugs of
the statute's "Schedule II" category (a class of drugs having a potential
for abuse and a recognized medical use) so the names and addresses
of the prescription drug patients can be recorded in a centralized
computer file maintained by the New York State Department of Health.
Some patients regularly receiving prescription for "Schedule II" drugs
and doctors who prescribed such drugs brought an action questioning
the validity of the statute on the ground that it violated the plaintiffs'
constitutionally protected rights of privacy.
In a unanimous decision, the US Supreme Court sustained the validity
of the statute on the ground that the patient identification requirement is
a reasonable exercise of the State's broad police powers. The Court
also held that there is no support in the record for an assumption that
the security provisions of the statute will be adiministered improperly.
Finally, the Court opined that the remote possibility that judicial
supervision of the evidentiary use of particular items of stored
information will not provide adequate protection against unwarranted
diclosures is not a sufficient reason for invalidating the patient-
identification program.
To be sure, there is always a possibility of an unwarranted disclosure of
confidential matters enomously accumulated in computerized data
banks and in government records relating to taxes, public health, social
security benefits, military affairs, and similar matters. But as previously
pointed out, we have a sufficient number of laws prohibiting and
punishing any such unwarranted disclosures. Anent this matter, the
observation in Whalen vs. Roe is instructive:
. . . We are not unaware of the threat to privacy
implicit in the accumulation of vast amounts of
personal information in computerized data banks or
other massive government files. The collection of
taxes, the distribution of welfare and social security
benefits, the supervision of public health, the
direction of our Armed Forces and the enforcement
of the criminal laws all require the orderly
preservation of great quantities of information, much
of which is personal in character and potentially
embarrassing or harmful if disclosed. The right to
collect and use such data for public purposes is
typically accompanied by a concomitant statutory or
regulatory duty to avoid unwarranted
disclosures. . . . 16
The majority laments that as technology advances, the level of
reasonably expected privacy decreases. That may be true. However,
court should tread daintily on the field of social and economic
experimentation lest they impede or obstruct the march of technology to
improve public services just on the basis of an unfounded fear that the
experimentation violates one's constitutionally protected rights. In the
sobering words of Mr. Justice Brandeis:
To stay experimentation in things social and
economic is a grave responsibility. Denial of the
right to experiment may be fraught with serious
consequences to the Nation. It is one of the happy
incidents of the federal system that a single
courageous State may, if its citizens choose, serve
as a laboratory; and try novel social and economic
experiments without risk to the rest of the country.
This Court has the power to prevent an experiment.
We may strike down the statute which embodies it
on the ground that, in our opinion, the measure is
arbitary, capricious or unreaonable. We have power
to do this, because the due process clause has
been held by he Court applicable to matters of
substantive law as well as to matters of procedure.
But in the exercise of this high power, we must be
ever on our guard, lest we erect our prejudices into
legal principles. If we would guide by the light of
reason, we must let our minds be bold. 17
Again, the concerns of the majority are premature precisely because
there are as yet no guidelines that will direct the Court and serve as
solid basis for determining the constitutionality of the new identification
system. The Court cannot and should not anticipate the constitutional
issues and rule on the basis of guesswok. The guidelines would,
among others, determine the particular biometrics method that would
be used and the specific personal data that would be collected provide
the safeguard, (if any) and supply the details on how this new system in
supposed to work. The Court should not jump the gun on the Executive.
III
On the issue of funding, the majority submits that Section 6 of A.O. No.
308, which allows the government agencies included in the new system
to obtain funding form their respective budgets, is unconstitutional for
being an illegal transfer of appropriations.
It is not so. The budget for the national identification system cannot be
deemed a transfer of funds since the same is composed of and will be
implemented by the member government agancies. Morever, thses
agencies particularly the GSIS and SSS have been issuing some form
of identification or membership card. The improved ID cards that will be
issued under this new system would just take place of the old
identification cards and budget-wise, the funds that were being used to
manufacture the old ID cards, which are usually accounted for under
the "Supplies and Materials" item of the Government Accounting and
Auditing Manual, could now be utilized to fund the new cards. Hence,
what is envisioned is not transfer of appropriations but a pooling of
funds and resources by the various government agencies involved in
the project.
WHEREFORE, I vote to dismiss the petition.
MENDOZA, J., separate opinion;
My vote is to dismiss the petition in this case.
First. I cannot find anything in the text of Administrative Order No. 308
of the President of the Philippines that would warrant a declaration that
it is violative of the right of privacy. So far as I can see, all the
Administrative Orders does is
• establish an Identification Reference System involving the
following service agencies of the government:
º Presidential Management Staff
º National Economic Developemnt Authority
 º Department of the Interior and Local Government
º Department of Health
º Government Service Isurance System
º Social Security Office
º National Computer Center
• create a committee, composed of the heads of the
agencies concerned, to draft rules for the System;
• direct the use of the Population Reference Number (PRN)
generated by the National Census and Statistics Office as
the common reference number to link the participating
agencies into an Identification Reference System, and the
adoption by the agencies of standards in the use of
biometrics technology and computer designs; and
• provide for the funding of the System from the budgets of
the agencies concerned.
Petitioner argues, however, that "the implementation of A.O. No. 308
will mean that each and every Filipino and resident will have a file with
the government containing, at the very least, his PRN and physiological
biometrics such as, but not limited to, his facial features, hand
geometry, retinal or iris pattern, DNA pattern, fingerprints, voice
characteristics, and signature analysis."
In support of his contention, petitioner quotes the following publication
surfed from the Internet:
The use of biometrics is the means by which an
individual may be conclusively identified. There are
two types of biometrics identifiers; Physical and
behavioral characteristics, Physiological biometrics
include facial features, hand geometry, retinal and
iris patterns. DNA, and fingerprints characteristics
include voice characteristics and signature analysis.
1 violates the right of privacy formed by emanations from the several
I do not see how from the bare provisions of the Order, the full text of
which is set forth in the majority opinion, petitioner and the majority can
conclude that the Identification Reference System establishes such
comprehensive personal information dossiers that can destroy
individual privacy. So far as the Order provides, all that is contemplated
is an identification system based on data which the government
agencies involved have already been requiring individuals making use
of their services to give.
For example, under C.A. No. 591, §2(a) the National Statistics Office
collects "by enumeration, sampling or other methods, statistics and
other information concerning population . . . social and economic
institutions, and such other statistics as the President may direct." In
addition, it is in charge of the administration of the Civil Register, 2
which means that it keeps records of information concerning the civil
status of persons, i.e., (a) births, (b) deaths, (c) marriages and their
annulments; (d) legitimations, (e) adoptions, (f) acknowledgments of
natural children, (g) naturalizations, and (h) changes of name. 3
Other statutes giving government agencies the power to require
personal information may be cited. R.A. No. 4136, §23 gives the Land
Transportation Office the power to require applicants for a driver's
license to give information regarding the following: their full names, date
of birth, height, weight, sex, color of eyes, blood type, address, and
right thumbprint;4 while R.A. No. 8239, §5 gives the Department of
Foreign Affairs the power to require passport applicants to give
information concerning their names, place of birth, date of birth,
religious affiliation, marital status, and citizenship.
Justice Romero, tracing the origin of privacy to the attempt of the first
man and woman to cover their nakedness with fig leaves, bemoans the
fact that technology and institutional pressures have threatened our
sense of privacy. On the other hand, the majority would have none of
the Identification Reference System "to prevent the shrinking of the
right to privacy, once regarded as "the most comprehensive of rights
and the right most valued by civilized men."" 5 Indeed, techniques such
as fingerprinting or electronic photography in banks have become
commonplace. As has been observed, the teaching hospital has come
to be accepted as offering madical services that compensate for the
loss of the isolation of the sickbed; the increased capacity of applied
sciences to utilize more and more kinds of data and the cosequent calls
for such data have weakened traditional resistance to disclosure. As
the area of relevance, political or scientific, expands, there is strong
psychological pressure to yield some ground of privacy. 6
But this is a fact of life to which we must adjust, as long as the intrusion
into the domain of privacy is reasonable. In Morfe v. Mutuc, 7 this Court
dealt the coup de grace to claims of latitudinarian scope for the right of
privacy by quoting the pungent remark of an acute observer of the
social scene, Carmen Guerrero-Nakpil:
Privacy? What's that? There is no precise word for it
in Filipino, and as far as I know any Filipino dialect
and there is none because there is no need for it.
The concept and practice of privacy are missing
from conventional Filipino life. The Filipino believes
that privacy is an unnecessary imposition, an
eccentricity that is barely pardonable or, at best, an
esoteric Western afterthought smacking of legal
trickery. 8
Justice Romero herself says in her separate opinion that the
word privacy is not even in the lexicon of Filipinos.
As to whether the right of privacy is "the most valued right," we do well
to remember the encomiums paid as well to other constitutional rights.
For Professor Zechariah Chafee, "The writ of habeas corpus is "the
most important human rights provision in the fundamental law,""9 For
Justice Cardozo, on the other hand, freedom of expression "is the
matrix, the indispensable condition of nearly every other form of
freedom." 10
The point is that care must be taken in assigning values to
constitutional rights for the purpose of calibrating them on the judicial
scale, especially if this means employing stricter standards of review for
regulations alleged to infringe certain rights deemed to be "most valued
by civilized men.''
Indeed, the majority concedes that "the right of privacy does not bar all
incursions into individual privacy . . . [only that such] incursions into the
right must be accompanied by proper safeguards and well-defined
standards to prevent unconstitutional invasions." 11 In the case of the
Identification Reference System, the purpose is to facilitate the
transaction of business with service agencies of the government and to
prevent fraud and misrepresentation. The personal identification of an
individual can facilitate his treatment in any government hospital in case
of emergency. On the other hand, the delivery of material assistance,
such as free medicines, can be protected from fraud or
misrepresentation as the absence of a data base makes it possible for
unscrupulous individuals to obtain assistance from more than one
government agency.
Second. Thus, the issue in this case is not really whether A.O. No. 308
constitutional rights cited by the majority. 12 The question is whether it
violates freedom of thought and of conscience guaranteed in the
following provisions of our Bill of Rights (Art. III):
Sec. 4. No law Shall be passed abridging the
freedom of speech, of expression, or of the press, or
the right of the people peaceably to assemble and
petition the government for redress of grievances.
Sec. 5. No law shall be made respecting an
establishment of religion, or prohibiting the free
exercise thereof. The free exercise enjoyment of
religious profession and worship, without
discrimination or preference, shall be forever be
allowed. No religious test shall be required for the
exercise of civil or political rights.
More specifically, the question is whether the establishment of the
Identification Reference System will not result in the compilation of
massive dossiers on individuals which, beyond their use for
identification, can become instruments of thought control. So far, the
next of A.O. No. 308 affords no basis for believing that the data
gathered can be used for such sinister purpose. As already stated,
nothing that is not already being required by the concerned agencies of
those making use of their servides is required by the Order in question.
The Order simply organizes service agencies of the government into a
System for the purpose of facilitating the identification of persons
seeking basic services and social security. Thus, the whereas clauses
of A.O. No. 308 state:
WHEREAS, there is a need to provide Filipino
citizens and foreign residents with the facility to
conveniently transact business with basic services
and social security providers and other government
instrumentalities;
WHEREAS, this will require a computerized system
to properly and efficiently identify persons seeking
basic services and social security, and reduce, if not
totally eradicate, fraudulent transactions and
misrepresentations;
WHEREAS, a concerted and collaborative effort
among the various basic services and social security
providing agencies and other government
instrumentalities is required to achieve such a
system:
The application of biometric technology and the
standardization of computer designs can provide service
agencies with precise identification of individuals, but what is
wrong with that?
Indeed, A.O. No. 308 is no more than a directive to government
agencies which the President of the Philippines has issued in his
capacity as administrative head. 13 It is not a statute. It confers no
right; it imposes no duty; it affords no protection; it creates no office. 14
It is, as its name indicates, a mere administrative order, the prescise
nature of which is given in the following excerpt from the decision in the
early case of Olsen & Co. v. Herstein: 15
 [It] is nothing more or less than a command from a
superior to an inferior. It creates no relation except
between the official who issues it and the official
who receives it. Such orders, whether executive or
departmental, have for their object simply the
efficient and economical administration of the affairs
of the department to which or in which they are
issued in accordance with the law governing the
subject-matter. They are administrative in their
nature and do not pass beyond the limits of the
department to which they are directed or in which
they are published, and, therefore, create no rights
in third persons. They are based on, and are the
product of a relationship in which power is their
source and obedience their object. Disobedience to
or deviation from such an order can be punished
only by the power which issued it: and, if that power
fails to administer the corrective, then the
disobedience goes unpunished. In that relationship
no third person or official may intervene, not even
the court. Such orders may be very temporary, they
being subject to instant revocation or modification by
the power which published them. Their very nature,
as determined by the relationship which prodecued
them, demonstrates clearly the impossibility of any
other person enforcing them except the one who
created them. An attempt on the part of the courts to
enforce such orders would result not only in
confusion but, substantially, in departmental anarchy
also. 16
Third. There is no basis for believing that, beyond the identification of
individuals, the System will be used for illegal purposes. Nor are
sanctions lacking for the unauthorized use or disclosure of information
gathered by the various agencies constituting the System. For example,
as the Solicitor General points out. C.A. No. 591. §4 penalizes the
unauthorized use or disclosure of data furnished the NSO with a fine of
not more than P600.00 or imprisonment for not more than six months or
both.
At all events, at this stage, it is premature to pass on the claim that the
Identification Reference System can be used for the purpose of
compiling massive dossiers on individuals that can be used to curtail
basic civil and political rights since, if at all, this can only be provided in
the implementing rules and regulations which have yet to be
promulgated. We have already stated that A.O. No. 308 is not a statute.
Even in the case of statutes, however, where implementing rules are
necessary to put them into effect, it has been held that an attack on
their constitutionality would be premature. 17 As Edgar in King Lear
puts it, "Ripeness is all." 18 For, to borrow some more Shakespearean
lines,
The canker galls the infants of the spring
Too oft before their buttons be disclos'd.
19
That, more than any doctrine of constitutional law I can think
of, succinctly expresses the rule on ripeness, prematurity, and
hypothetical, speculative, or conjectural claims.
Of special relevance to this case is Laird v. Tatum. 20 There, a class
suit was brought seeking declaratory and injunctive relief on the claim
that a U.S. Army intelligence surveillance of civilian political activity
having "a potential for civil disorder" exercised "a present inhibiting
effect on [respondents'] full expression and utilization of their First
Amendment rights." In holding the case nonjusticiable, the U.S.
Supreme Court, in an opinion by Chief Justice Burger. said: 21
In recent years this Court has found in a number of
cases that constitutional violations may arise from
the deterrent or ''chilling," effect of governmental
regulations that fall short of a direct prohibition
against the exercise of First Amendment rights.
[Citation of cases omitted] In none of these cases,
however, did the chilling effect arise merely from the
individual's knowledge that a governmental agency
was engaged in certain activities or from the
individual's concomitant fear that, armed with the
fruits of those activities, the agency might in the
future take some other and additional action
detrimental to that individual. Rather, in each of
these cases, the challenged exercise of
governmental power was regulatory, proscriptive, or
compulsory in nature, and the complainant was
either presently or prospectively subject to the
regulations, proscriptions, or compulsions that he
was challenging. . . .
[T]hese decisions have in no way eroded the
"established principle that to entitle a private
individual to invoke the judicial power to determine
the validity of executive or legislative action he must
show that he was sustained or is immediately in
danger of sustaining a direct injury as the result of
that action. . . .
The respondents do not meet this test; [the] alleged
"chilling" effect may perhaps be seen as arising from
respondents' perception of the system as
inappropriate to the Army's role under our form of
government, or as arising from respondents' beliefs
that it is inherently dangerous for the military to be
concerned with activities in the civilian sector, or as
arising from respondents' less generalized yet
speculative apprehensiveness that the Army may at
some future date misuse the information in some
way that would cause direct harm to respondents.
Allegations of a subjective "chill" are not an
adequate substitute for a claim of specific present
objective harm or a threat of specific future harm:
"the federal courts established pursuant to Article III
of the Constitution do not render advisory opinions."
United Public Workers v. Mitchell, 330 US 75, 89, 91
L Ed 754, 766, 67 S Ct 556 (1947).
Fourth. Given the fact that no right of privacy is involved in this case
and that any objection to the identification Reference System on the
ground that it violates freedom of thought is premature, speculative, or
conjectural pending the issuance of the implementing rules, it is clear
that petitioner Blas F. Ople has no cause of action and, therefore, no
standing to bring this action. Indeed, although he assails A.O. No. 308
on the ground that it violates the right of privacy, he claims no personal
injury suffered as a result of the Order in question. Instead, he says he
is bringing this action as taxpayer, Senator, and member of the
Government Service Insurance System.
Insofar as petitioner claims an interest as taxpayer, it is sufficient to say
that A.O. No. 308 does not involve the exercise of the taxing or
spending power of the government.
Insofar as he purports to sue as a member of the GSIS, neither does
petitioner have an intertest sufficient to enable him to litigate a
constitutional question. Petitioner claims that in providing that the funds
necessary for implementing the System shall be taken from the budgets
of the concerned agencies. A.O. No. 308 violates Art. VI, §25(5) which.
provides:
No law shall be passed authorizing any transfer of
appropriations; however, the President, the
President of the Senate, the Speaker of the House
of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional
Commissions may, by law, be authorized to
augment any item in the general appropriations law
for their respective offices from savings in other
items of their respective appropriations.
But, as the Solicitor General states:
Petitioner's argument is anchored on two erroneous
assumptions: one, that all the concerned agencies,
including the SSS and the GSIS, receive budgetary
support from the national government; and two, that
the GAA is the only law whereby public funds are
appropriated. Both assumptions are wrong.
The SSS and GSIS do not presently receive
budgetary support from the National Government.
They have achieved self-supporting status such that
the contributions of their members are sufficient to
finance their expenses. One would be hard pressed
to find in the GAA an appropriation of funds to the
SSS and the GSIS.
Furthermore, their respective charters authorize the
SSS and the GSIS to disburse their funds (Rep. Act
No. 1161 [1954], as amended, Sec. 25; Pres.
Decree No. 1146 [1977], as amended, Sec. 29)
without the need for a separate appropriation from
the Congress.
Nor as Senator can petitioner claim standing since no power of
Congress is alleged to have been impaired by the Administrative Order
in question. 22 As already stated, in issuing A.O. No. 308, the President
did not exercise the legislative power vested by the Constitution in
Congress. He acted on the basis of his own powers as administrative
head of the government, as distinguished from his capacity as the
Executive. Dean Sinco elucidates the crucial distinction thus:
The Constitution of the Philippines makes the
President not only the executive but also the
administrative head of the government. . . .
Executive power refers to the legal and political
function of the President involving the exercise of
discretion. Administrative power, on the other hand,
concerns itself with the work of applying policies and
enforcing orders as determined by proper
 governmental organs. These two functions are often
confused by the public: but they are distinct from
each other. The President as the executive authority
has the duty of supervising the enforcement of laws
for the maintenance of general peace and public
order. As administrative head, his duty is to see that
every government office is managed and maintained
properly by the persons in charge of it in accordance
with pertinent laws and regulations.
. . . The power of control vested in him by the
Constitution makes for a strongly centralized
administrative system. It reinforces further his
position as the executive of the government,
enabling him to comply more effectively with his
constitutional duty to enforce the laws. It enables
him to fix a uniform standard of a administrative
eficiency and to check the official conduct of his
agents. The decisions of all the officers within his
department are subject to his power of revision,
either on his own motion or on the appeal of some
individual who might deem himself aggrieved by the
action of an administrative official. In case of serious
dereliction of duty, he may suspend or remove the
officials concerned. 23
For the foregoing reasons, the petition should be DISMISSED.
# Separate Opinions
ROMERO, J., separate opinion;
What marks offs man from a beast?
Aside from the distinguishing physical characteristics, man is a rational
being, one who is endowed with intellect which allows him to apply
reasoned judgment to problems at hand; he has the innate spiritual
faculty which can tell, not only what is right but, as well, what is moral
and ethical. Because of his sensibilities, emotions and feelings, he
likewise possesses a sense of shame. In varying degrees as dictated
by diverse cultures, he erects a wall between himself and the outside
world wherein he can retreat in solitude, protecting himself from prying
eyes and ears and their extensions, whether form individuals, or much
later, from authoritarian intrusions.
Piercing through the mists of time, we find the original Man and Woman
defying the injunction of God by eating of the forbidden fruit in the
Garden. And when their eyes were "opened" forthwith "they sewed fig
leaves together, and made themselves aprons." 1 Down the corridors of
time, we find man fashioning "fig leaves" of sorts or setting up figurative
walls, the better to insulate themselves from the rest of humanity.
Such vague stirrings of the desire "to be left alone," considered "anti-
social" by some, led to the development of the concept of "privacy,"
unheard of among beasts. Different branches of science, have made
their own studies of this craving of the human spirit — psychological,
anthropological sociological and philosophical, with the legal finally
giving its imprimatur by elevating it to the status ofa right, specifically a
private right.
Initially recognized as an aspect of tort law, it created giant waves in
legal circles with the publication in the Harvard Law Review 2 of the
trail-blazing article, "The Right to Privacy," by Samuel D. Warren and
Louis D. Brandeis.
Whether viewed as a personal or a property right, it found its way in
Philippine Constitutions and statutes; this, in spite of the fact that
Philippine culture can hardly be said to provide a fertile field for the
burgeoning of said right. In fact, our lexicographers have yet to coin a
word for it in the Filipino language. Customs and practices, being what
they have always been, Filipinos think it perfectly natural and in good
taste to inquire into each other's intimate affairs.
One has only to sit through a televised talk show to be convinced that
what passes for wholesome entertainment is actually an invasion into
one's private life, leaving the interviewee embarrassed and outraged by
turns.
With the overarching influence of common law and the recent advent of
the Information Age with its high-tech devices, the right to privacy has
expanded to embrace its public law aspect. The Bill of Rights of our
evolving Charters, a direct transplant from that of the United States,
contains in essence facets of the right to privacy which constitute
limitations on the far-reaching powers of government.
So terrifying are the possibilities of a law such as Administrative Order
No. 308 in making inroads into the private lives of the citizens, a virtual
Big Brother looking over our shoulder, that it must, without delay, be
"slain upon sight" before our society turns totalitarian with each of us, a
mindless robot.
I, therefore, VOTE for the nullification of A.O. No. 308.
VITUG, J., separate opinion;
One can appreciate the concern expressed by my esteemed colleague,
Mr. Justice Reynato S. Puno, echoing that of the petitioner, the
Honorable Blas F. Ople, on the issuance of Administrative Order No.
308 by the President of the Philippines and the dangers its
implementation could bring. I find it hard, nevertheless, to peremptorily
assume at this time that the administrative order will be misused and to
thereby ignore the possible benefits that can be derived from, or the
merits of, a nationwide computerized identification reference system.
The great strides and swift advances in technology render it
inescapable that one day we will, at all events, have to face up with the
reality of seeing extremely sophisticated methods of personal
identification and any attempt to stop the inevitable may either be short-
lived or even futile. The imperatives, I believe, would instead be to now
install specific safeguards and control measures that may be calculated
best to ward-off probable ill effects of any such device. Here, it may be
apropos to recall the pronouncement of this Court in People vs.
Nazario 1 that —
As a rule, a statute or [an] act may be said to be
vague when it lacks comprehensible standards that
men "of common intelligence must necessarily
guess at its meaning and differ as to its application."
It is repugnant to the Constitution in two respects:
(1) it violates due process for failure to accord
persons, especially the parties targeted by it, fair
notice of the conduct to avoid; and (2) it leaves law
enforcers unbridled discretion in carrying out its
provisions and becomes an arbitrary flexing of the
Government muscle. 2
Administrative Order No. 308 appears to be so extensively
drawn that could, indeed, allow unbridled options to become
available to its implementors beyond the reasonable comfort
of the citizens and of residents alike.
Prescinding from the foregoing, and most importantly to this instance,
the subject covered by the questioned administrative order can have
far-reaching consequences that can tell on all individuals, their liberty
and privacy, that, to my mind, should make it indispensable and
appropriate to have the matter specifically addressed by the Congress
of the Philippines, the policy-making body of our government, to which
the task should initially belong and to which the authority to formulate
and promulgate that policy is constitutionally lodged.
WHEREFORE, I vote for the nullification of Administrative Order No.
308 for being an undue and impermissible exercise of legislative power
by the Executive.
PANGANIBAN, J., separate opinion;
I concur only in the result and only on the ground that an executive
issuance is not legally sufficient to establish an all-encompassing
computerized system of identification in the country. The subject matter
contained in AO 308 is beyond the powers of the President to regulate
without a legislative enactment.
I reserve judgmeht on the issue of wherher a national ID system is an
infringement of the constitutional right to privacy or the freedom of
thought until after Congress passes, if ever, a law to this effect. Only
then, and upon the filing of a proper petition, may the provisions of the
statute be scrutinized by the judiciary to determine their constitutional
foundation. Until such time, the issue is premature; and any decision
thereon, speculative and academic. 1
Be that as it may, the scholarly discussions of Justices Romero, Puno,
Kapunan and Mendoza on the constitutional right to privacy and
freedom of thought may stil become useful guides to our lawmakers,
when and if Congress should deliberate on a bill establishing a national
identification system.
Let it be noted that this Court, as shown by the voting of the justices,
has not definitively ruled on these points. The voting is decisive only on
the need for the appropriate legislation, and it is only on this ground that
the petition is granted by this Court.
 
KAPUNAN, J., dissenting opinion;
The pioneering efforts of the executive to adopt a national
computerized identification reference system has met fierce opposition.
It has spun dark predictions of sinister government ploys to tamper with
the citizen's right to privacy and ominous forecasts of a return to
authoritarianism. Lost in the uproar, however, is the simple fact that
there is nothing in the whole breadth and lenght of Administrative Order
No. 308 that suggests a taint constitutional infirmity.
A.O. No. 308 issued by President Fidel V. Ramos on 12 December
1996 reads:
ADMTNISTRATIVE ORDER NO. 308
ADOPTION OF A NATIONAL COMPUTERIZED
IDENTIFICATION REFERENCE SYSTEM
WHEREAS, there is a need to provide Filipino
citizens and foreign residents with the facility to
conveniently transact business with basic services
and social security providers and other government
instrumentalities;
 WHEREAS, this will require a computerized system
to properly and efficiently identify persons seeking
basic services and social security and reduce, if not
totally eradicate, fraudulent transactions and
misrepresentations;
WHEREAS, a concerted and collaborative effort
among the various basic services and social security
providing agencies and other government
instrumentalities is required to achieve such a
system;
NOW, THEREFORE, I, FIDEL V. RAMOS,
President of the Repubic of the Philippines, by virtue
of the powers vested in me by law, do hereby direct
the following:
Sec. 1 Establishment of a National Computerized
Identification Reference System. A decentralized
Identification Reference System among the key
basic services and social security providers is
hereby established.
Sec. 2. Inter-Agency Coordinating Committee. An
Inter-Agency Coordinating Committee (IACC) to
draw-up the implementing guidelines and oversee
the implementation of the System is hereby created,
chaired by the Executive Secretary, with the
following as members:
Head Presidential Management Staff
Secretary, National Economic Development
Authority
Secretary, Department of the Interior and
Local Government
Secretary, Department of Health
Administrator, Government Service
Insurance System
Administrator, Social Security System
Administrator, National Statistics Office
Managing Director, National Computer
Center
Sec. 3. Secretariat. The National Computer Center
(NCC) is hereby designated as secretariat to the
IACC and as such shall provide administrative and
technical support to the IACC.
Sec. 4. Linkage Among Agencies. The Population
Reference Number (PRN) generated by the NSO
shall serve as the common reference number to
establish a linkage among concerned agencies. The
IACC Secretariat shall coordinate with the different
Social Security and Services Agencies to establish
the standards in the use of Biometrics Technology
and in computer application designs of their
respective systems.
Sec. 5. Conduct of Information Dissemination
Campaign. The Office of the Press Secretary, in
coordination with the National Statistics Offices, the
GSIS and SSS as lead agencies and other
concerned agencies shall undertake a massive tri-
media information dissemination campaign to
educate and raise public awareness on the
importance and use of the PRN and the Social
Security Identification Reference.
Sec. 6. Funding. The funds necessary for the
implementation of the system shall be sourced from
the respective budgets of the concerned agencies.
Sec. 7. Submission of Regular Reports. The NSO,
GSIS and SSS shall submit regular reports to the
Office of the President, through the IACC, on the
status of implementation of this undertaking.
Sec. 8 Effectivity. This Administartive Order shall
take effect immediately.
DONE in the City of Manila, this 12th day of
December in the year of Our Lord, Nineteen
Hundred and Ninety-Six.
In seeking to strike down A.O. No. 308 as unconstitutional, petitioner
argues:
A. THE ESTABLISHMENT OF NATIONAL
COMPUTERIZED IDENTIFICATION REFERENCE
SYSTEM REQUIRES A LEGISLATIVE ACT. THE
ISSUACE OF A.O. NO. 308 BY THE PRESIDENT
OF THE REPUBLIC OF THE PHILIPPINES IS,
THEREFORE, AN UNCONSTITUTIONAL
USURPATION OF THE LEGISLATIVE POWERS
OF THE CONGRESS OF THE REPUBLIC OF THE
PHILIPPINES.
B. THE APPROPRIATION OF PUBLIC FUNDS BY
THE PRESIDENT FOR THE IMPLEMENTATION
OF A.O. NO. 308 IS AN UNCONSTITUTIONAL
USURPATION OF THE EXCLUSIVE RIGHT OF
CONGRESS TO APPROPRIATE PUBLIC FUNDS
FOR EXPENDITURE.
C. THE IMPLEMENTATION OF A.O. NO. 308
INSIDIOUSLY LAYS THE GROUNDWORK FOR A
SYSTEM WHICH WILL VIOLATE THE BILL OF
RIGHTS ENSHRINED IN THE CONSTITUTION.
The National Computerized Identification Reference system to which
the NSO, GSIS and SSS are linked as lead members of the IACC is
intended to establish uniform standards for ID cards isssued by key
government agencies (like the SSS) 1 for the "efficient identification of
persons." 2 Under the new system, only one reliable and tamper-proof
I.D. need be presented by the cardholder instead of several
identification papers such as passports and driver's license, 3 to able to
transact with government agencies. The improved ID can be used to
facilitate public transactions such as:
1. Payment of SSS and GSIS benefits
2. Applications for driver's license, BIR TIN,
passport, marriage license, death certificate, NBI
and police clearances, and business permits
3. Availment of Medicare services in hospitals
4. Availment of welfare services
5. Application for work/employment
6. Pre-requisite for Voter's ID. 4
The card may also be used for private transactions such as:
1. Opening of bank accounts
2. Encashment of checks
3. Applications for loans, credit cards, water, power,
telephones, pagers, etc.
4. Purchase of stocks
5. Application for work/employment
6. Insurance claims
7. Receipt of payments, checks, letters, valuables,
etc. 5
The new identification system would tremendously improve and uplift
public service in our country to the benefit of Filipino citizens and
resident aliens. It would promote, facilitate and speed up legitimate
transactions with government offices as well as with private and
business entities. Experience tells us of the constant delays and
inconveniences the public has to suffer in availing of basic public
services and social security benefits because of inefficient and not too
reliable means of identification of the beneficiaries.
Thus, in the "Primer on the Social Security Card and Administrative
Order No. 308" issued by the SSS, a lead agency in the implementation
of the said order, the following salient features are mentioned:
1. A.O. 308 merely establishes the standards for I.D.
cards issued by key government agencies such as
SSS and GSIS.
2. It does not establish a national I.D. system neither
does it require a national I.D. card for every person.
3. The use of the I.D. is voluntary.
4. The I.D. is not required for delivery of any
government service. Everyone has the right to basic
government services as long as he is qualified under
existing laws.
5. The LD. cannot and will not in any way be used to
prevent one to travel.
6. There will be no discrimination Non-holders of the
improved I.D. are still entitled to the same services
but will be subjected to the usual rigid identification
and verification beforehand.
I
The issue that must first be hurdled is: was the issuance of A.O. No.
308 an exercise by the President of legislative power properly
belonging to Congress?
It is not.
The Administrative Code of 1987 has unequivocally vested the
President with quasi-legislative powers in the form of executive orders,
administrative orders, proclamations, memorandum orders and
circulars and general or special orders. 6 An administrative order, like
the one under which the new identification system is embodied, has its
peculiar meaning under the 1987 Administrative Code:
Sec. 3. Administrative Orders. — Acts of the
President which relate to particular aspects of
governmental operations in pursuance of his duties
as administrative head shall be promulgated in
administrative orders.
The National Computerized Identification Reference System was
established pursuant to the aforaquoted provision precisely because its
principal purpose, as expressly stated in the order, is to provide the
people with "the facility to conveniently transact business" with the
various government agencies providing basic services. Being the
"administrative head," it is unquestionably the responsibility of the
President to find ways and means to improve the government
bureaucracy, and make it more professional, efficient and reliable,
specially those government agencies and instrumentalities which
provide basic services and which the citizenry constantly transact with,
like the Government Service Insurance System (GSIS), Social Security
System (SSS) and National Statistics Office (NSO). The national
computerized ID system is one such advancement. To emphasize, the
new identification reference system is created to streamline the
bureaucracy, cut the red tape and ultimately achieve administrative
efficiency. The project, therefore, relates to, is an appropriate subject
and falls squarely within the ambit of the Chief Executive's
administrative power under which, in order to successfully carry out his
administrative duties, he has been granted by law quasi-legislative
powers, quoted above.
Understandably, strict adherence to the doctrine of separation of power
spawns differences of opinion. For we cannot divide the branches of
government into water-tight compartment. Even if such is possible, it is
neither desirable nor feasible. Bernard Schwartz, in his work
Administrative Law, A Casebook, thus states:
To be sure, if we think of the separation of powers
as carrying out the distinction between legislation
and administration with mathematical precision and
as dividing the branches of government into
watertight compartments, we would probably have
to conclude that any exercise of lawmaking authority
by an agency is automatically invalid. Such a
rigorous application of the constitutional doctrine is
neither desirable nor feasible; the only absolute
separation that has ever been possible was that in
the theoretical writings of a Montesquieu, who
looked across at foggy England from his sunny
Gascon vineyards and completely misconstrued
what he saw. 7
A mingling of powers among the three branches of government is not a
novel concept. This blending of powers has become necessary to
properly address the complexities brought about by a rapidly
developing society and which the traditional branches of government
have difficulty coping with. 8
It has been said that:
The true meaning of the general doctrine of the
separation of powers seems to be that the whole
power of one department should not be exercised by
the same hands which possess the whole power of
either of the other department, and that no one
department ought to possess directly or indirectly an
overruling influence over the others. And it has been
that this doctrine should be applied only to the
powers which because of their nature are assigned
by the constitution itself to one of the departments
exclusively. Hence, it does not necessarily follow
that an entire and complete separation is either
desirable of was ever intended, for such a complete
separation would be impracticable if not impossible;
there may be-and frequently are-areas in which
executive, legislative, and judicial powers blend or
overlap; and many officers whose duties cannot be
exclusively placed under any one of these heads.
The courts have perceived the necessity of avoiding
a narrow construction of a state constitutional
provision for the division of the powers of the
government into three distinct departments, for it is
impractical to view the provision from the standpoint
of a doctrinaire. Thus, the modern view of
separation of powers rejects the metaphysical
abstractions and reverts instead to more pragmatic,
flexible, functional approach, giving recognition to
the fact that then may be a certain degree of
blending or admixture of the three powers of the
government. Moreover, the doctrine of separation of
powers has never been strictly or rigidly applied, and
indeed could not be, to all the ramifications of state
or national governments; government would prove
abortive if it were attempted to follow the policy of
separation to the letter. 9
In any case A.O. No. 308 was promulgated by the President pursuant
to the quasi-legislative powers expressly granted to him by law and in
accordance with his duty as administrative head. Hence, the contention
that the President usurped the legislative prerogatives of Congress has
no firm basis.
II
Having resolved that the President has the authority and prerogative to
issue A.O. No. 308, I submit that it is premature for the Court to
determine the constitutionality or unconstitutionality of the National
Computerized Identification Reference System.
Basic in constitutional law is the rule that before the court assumes
jurisdiction over and decide constitutional issues, the following
requisites must first be satisfied:
1) there must be an actual case or controversy involving a conflict of
rights susceptible of judicial determination;
2) the constitutional question must be raised by a proper party;
3) the constitutional question must be raised at the earliest opportunity;
and
4) the resolution of the constitutional question must be necessary to the
resolution of the case. 10
In this case, it is evident that the first element is missing. Judicial
intervention calls for an actual case or controversy which is defined as
"an existing case or controversy that is appropriate or ripe for
determination, not conjectural or anticipatory." 11 Justice Isagani A.
Cruz further expounds that "(a) justifiable controversy is thus
distinguished from a difference or dispute of a hypothetical or abstract
character or from one that is academic or moot. The controversy must
be definite and concrete, touching the legal relations of parties having
adverse legal interests. It must be a real and substantial controversy
admitting of special relief through a decree that is conclusive in
character, as distinguished from an opinion advising what the law would
be upon a hypothetical state of facts. . . ." 12 A.O. No. 308 does not
create any concrete or substantial controversy. It provides the general
framework of the National Computerized Identification Reference
System and lays down the basic standards (efficiency, convenience
and prevention of fraudulent transactions) for its cretion. But as
manifestly indicated in the subject order, it is the Inter-Agency
Coordinating Committee (IACC) which is tasked to research, study and
formulate the guidelines and parameters for the use of Biometrics
Technology and in computer application designs that will and define
give substance to the new system. 13 This petition is, thus, premature
considering that the IACC is still in the process of doing the leg work
and has yet to codify and formalize the details of the new system.
The majority opines that the petition is ripe for adjudication even without
the promulgation of the necessary guidelines in view of the fact that
respondents have begun implementation of A.O. No. 308. The SSS, in
particular, has started advertising in newspapers the invitation to bid for
the production of the I.D. cards. 14
I beg to disagree. It is not the new system itself that is intended to be
implemented in the invitation to bid but only the manufacture of the I.D.
cards. Biometrics Technology is not and cannot be used in the I.D.
cards as no guidelines therefor have yet been laid down by the IACC.
Before the assailed system can be set up, it is imperative that the
guidelines be issued first.
III
Without the essential guidelines, the principal contention for invalidating
the new identification reference system — that it is an impermissible
encroachment on the constitutionally recognized right to privacy — is
plainly groundless. There is nothing in A.O. No. 308 to serve as
sufficient basis for a conclusion that the new system to be evolved
violates the right to privacy. Said order simply provides the system's
general framework. Without the concomitant guidelines, which would
spell out in detail how this new identification system would work, the
perceived violation of the right to privacy amounts to nothing more than
mere surmise and speculation.
What has caused much of the hysteria over the National Computerized
Identification Reference System is the possible utilization of Biometrics
Technology which refers to the use of autnomated matching of
physiological or behavioral characteristics to identify a person that
would violated the citizen's constitutionally protected right to privacy.
The majority opinion has enumerated various forms and methods of
Biometrics Technology which if adopted in the National Computaized
Identification Reference System would seriously threaten the right to
privacy. Among which are biocrypt retinal scan, artificial nose and
thermogram. The majority also points to certain alleged deficiencies of
A O. No. 308. Thus:
1) A.O. No. 308 does not specify the particular
Biometrics Technology that shall be used for the
new identification system.
2) The order dots not state whether encoding of data
is limited to biological information alone for
identification purposes;
3) There is no provision as to who shall control and
access the data, under what circumstances and for
what purpose; and
4) There are no controls to guard against leakage of
information, thus heightening the potential for
misuse and abuse.
We should not be overwhelmed by the mere mention of the Biometrics
Technology and its alleged, yet unfounded "far-reaching effects."
There is nothing in A.O. No. 308, as it is worded, to suggest that the
advanced methods of the Biometrics Technology that may pose danger
to the right of privacy will be adopted.
The standards set in A.O. No. 308 for the adoption of the new system
are clear-cut and unequivocably spelled out in the "WHEREASES" and
body of the order, namely, the need to provide citizens and foreign
residents with the facility to conveniently transact business with basic
service and social security providers and other government
instrumentalities; the computerized system is intended to properly and
efficiently identify persons seeking basic services or social security and
reduce, if not totally eradicate fraudulent transactions and
misreprentation; the national identification reference system is
established among the key basic services and social security providers;
and finally, the IACC Secretariat shall coordinate with different Social
Security and Services Agencies to establish the standards in the use of
Biometrics Technology. Consequently, the choice of the particular form
and extent of Biometrics Technology that will be applied and the
parameters for its use (as will be defined in the guidelines) will
necessarily and logically be guided, limited and circumscribed by the
afore-stated standards. The fear entertained by the majority on the
potential dangers of this new technology is thus securedly allayed by
the specific limitations set by the above-mentioned standards. More
than this, the right to privacy is well-esconced in and directly protected
by various provisions of the Bill of Rights, the Civil Code, the Revised
Penal Code, and certain laws, all so painstakingly and resourcefully
catalogued in the majority opinion. Many of these laws provide
penalties for their violation in the form of imprisonment, fines, or
damages. These laws will serve as powerful deterrents not only in the
establishment of any administrative rule that will violate the
constitutionally protected right to privacy, but also to would-be
transgressors of such right.
Relevant to this case is the ruling of the U.S. Supreme Court in Whalen
v. Roe. 15 In that case, a New York statute was challenged for
requiring physicians to identify patients obtaining prescription drugs of
the statute's "Schedule II" category (a class of drugs having a potential
for abuse and a recognized medical use) so the names and addresses
of the prescription drug patients can be recorded in a centralized
computer file maintained by the New York State Department of Health.
Some patients regularly receiving prescription for "Schedule II" drugs
and doctors who prescribed such drugs brought an action questioning
the validity of the statute on the ground that it violated the plaintiffs'
constitutionally protected rights of privacy.
In a unanimous decision, the US Supreme Court sustained the validity
of the statute on the ground that the patient identification requirement is
a reasonable exercise of the State's broad police powers. The Court
also held that there is no support in the record for an assumption that
the security provisions of the statute will be adiministered improperly.
Finally, the Court opined that the remote possibility that judicial
supervision of the evidentiary use of particular items of stored
information will not provide adequate protection against unwarranted
diclosures is not a sufficient reason for invalidating the patient-
identification program.
To be sure, there is always a possibility of an unwarranted disclosure of
confidential matters enomously accumulated in computerized data
banks and in government records relating to taxes, public health, social
security benefits, military affairs, and similar matters. But as previously
pointed out, we have a sufficient number of laws prohibiting and
punishing any such unwarranted disclosures. Anent this matter, the
observation in Whalen vs. Roe is instructive:
. . . We are not unaware of the threat to privacy
implicit in the accumulation of vast amounts of
personal information in computerized data banks or
other massive government files. The collection of
taxes, the distribution of welfare and social security
benefits, the supervision of public health, the
direction of our Armed Forces and the enforcement
of the criminal laws all require the orderly
preservation of great quantities of information, much
of which is personal in character and potentially
embarrassing or harmful if disclosed. The right to
collect and use such data for public purposes is
typically accompanied by a concomitant statutory or
regulatory duty to avoid unwarranted
disclosures. . . . 16
The majority laments that as technology advances, the level of
reasonably expected privacy decreases. That may be true. However,
court should tread daintily on the field of social and economic
experimentation lest they impede or obstruct the march of technology to
improve public services just on the basis of an unfounded fear that the
experimentation violates one's constitutionally protected rights. In the
sobering words of Mr. Justice Brandeis:
To stay experimentation in things social and
economic is a grave responsibility. Denial of the
right to experiment may be fraught with serious
consequences to the Nation. It is one of the happy
incidents of the federal system that a single
courageous State may, if its citizens choose, serve
as a laboratory; and try novel social and economic
experiments without risk to the rest of the country.
This Court has the power to prevent an experiment.
We may strike down the statute which embodies it
on the ground that, in our opinion, the measure is
arbitary, capricious or unreaonable. We have power
to do this, because the due process clause has
been held by he Court applicable to matters of
substantive law as well as to matters of procedure.
But in the exercise of this high power, we must be
ever on our guard, lest we erect our prejudices into
legal principles. If we would guide by the light of
reason, we must let our minds be bold. 17
Again, the concerns of the majority are premature precisely because
there are as yet no guidelines that will direct the Court and serve as
solid basis for determining the constitutionality of the new identification
system. The Court cannot and should not anticipate the constitutional
issues and rule on the basis of guesswok. The guidelines would,
among others, determine the particular biometrics method that would
be used and the specific personal data that would be collected provide
the safeguard, (if any) and supply the details on how this new system in
supposed to work. The Court should not jump the gun on the Executive.
III
On the issue of funding, the majority submits that Section 6 of A.O. No.
308, which allows the government agencies included in the new system
to obtain funding form their respective budgets, is unconstitutional for
being an illegal transfer of appropriations.
It is not so. The budget for the national identification system cannot be
deemed a transfer of funds since the same is composed of and will be
implemented by the member government agancies. Morever, thses
agencies particularly the GSIS and SSS have been issuing some form
of identification or membership card. The improved ID cards that will be
issued under this new system would just take place of the old
identification cards and budget-wise, the funds that were being used to
manufacture the old ID cards, which are usually accounted for under
the "Supplies and Materials" item of the Government Accounting and
Auditing Manual, could now be utilized to fund the new cards. Hence,
what is envisioned is not transfer of appropriations but a pooling of
funds and resources by the various government agencies involved in
the project.
WHEREFORE, I vote to dismiss the petition.
MENDOZA, J., separate opinion;
My vote is to dismiss the petition in this case.
First. I cannot find anything in the text of Administrative Order No. 308
of the President of the Philippines that would warrant a declaration that
it is violative of the right of privacy. So far as I can see, all the
Administrative Orders does is
• establish an Identification Reference System involving the
following service agencies of the government:
º Presidential Management Staff
º National Economic Developemnt Authority
º Department of the Interior and Local Government
º Department of Health
º Government Service Isurance System
º Social Security Office
º National Computer Center
• create a committee, composed of the heads of the
agencies concerned, to draft rules for the System;
• direct the use of the Population Reference Number (PRN)
generated by the National Census and Statistics Office as
the common reference number to link the participating
agencies into an Identification Reference System, and the
adoption by the agencies of standards in the use of
biometrics technology and computer designs; and
• provide for the funding of the System from the budgets of
the agencies concerned.
Petitioner argues, however, that "the implementation of A.O. No. 308
will mean that each and every Filipino and resident will have a file with
the government containing, at the very least, his PRN and physiological
biometrics such as, but not limited to, his facial features, hand
geometry, retinal or iris pattern, DNA pattern, fingerprints, voice
characteristics, and signature analysis."
In support of his contention, petitioner quotes the following publication
surfed from the Internet:
The use of biometrics is the means by which an
individual may be conclusively identified. There are
two types of biometrics identifiers; Physical and
 behavioral characteristics, Physiological biometrics
include facial features, hand geometry, retinal and
iris patterns. DNA, and fingerprints characteristics
include voice characteristics and signature analysis.
1 constitutional rights cited by the majority. 12 The question is whether it
I do not see how from the bare provisions of the Order, the full text of
which is set forth in the majority opinion, petitioner and the majority can
conclude that the Identification Reference System establishes such
comprehensive personal information dossiers that can destroy
individual privacy. So far as the Order provides, all that is contemplated
is an identification system based on data which the government
agencies involved have already been requiring individuals making use
of their services to give.
For example, under C.A. No. 591, §2(a) the National Statistics Office
collects "by enumeration, sampling or other methods, statistics and
other information concerning population . . . social and economic
institutions, and such other statistics as the President may direct." In
addition, it is in charge of the administration of the Civil Register, 2
which means that it keeps records of information concerning the civil
status of persons, i.e., (a) births, (b) deaths, (c) marriages and their
annulments; (d) legitimations, (e) adoptions, (f) acknowledgments of
natural children, (g) naturalizations, and (h) changes of name. 3
Other statutes giving government agencies the power to require
personal information may be cited. R.A. No. 4136, §23 gives the Land
Transportation Office the power to require applicants for a driver's
license to give information regarding the following: their full names, date
of birth, height, weight, sex, color of eyes, blood type, address, and
right thumbprint;4 while R.A. No. 8239, §5 gives the Department of
Foreign Affairs the power to require passport applicants to give
information concerning their names, place of birth, date of birth,
religious affiliation, marital status, and citizenship.
Justice Romero, tracing the origin of privacy to the attempt of the first
man and woman to cover their nakedness with fig leaves, bemoans the
fact that technology and institutional pressures have threatened our
sense of privacy. On the other hand, the majority would have none of
the Identification Reference System "to prevent the shrinking of the
right to privacy, once regarded as "the most comprehensive of rights
and the right most valued by civilized men."" 5 Indeed, techniques such
as fingerprinting or electronic photography in banks have become
commonplace. As has been observed, the teaching hospital has come
to be accepted as offering madical services that compensate for the
loss of the isolation of the sickbed; the increased capacity of applied
sciences to utilize more and more kinds of data and the cosequent calls
for such data have weakened traditional resistance to disclosure. As
the area of relevance, political or scientific, expands, there is strong
psychological pressure to yield some ground of privacy. 6
But this is a fact of life to which we must adjust, as long as the intrusion
into the domain of privacy is reasonable. In Morfe v. Mutuc, 7 this Court
dealt the coup de grace to claims of latitudinarian scope for the right of
privacy by quoting the pungent remark of an acute observer of the
social scene, Carmen Guerrero-Nakpil:
Privacy? What's that? There is no precise word for it
in Filipino, and as far as I know any Filipino dialect
and there is none because there is no need for it.
The concept and practice of privacy are missing
from conventional Filipino life. The Filipino believes
that privacy is an unnecessary imposition, an
eccentricity that is barely pardonable or, at best, an
esoteric Western afterthought smacking of legal
trickery. 8
Justice Romero herself says in her separate opinion that the
word privacy is not even in the lexicon of Filipinos.
As to whether the right of privacy is "the most valued right," we do well
to remember the encomiums paid as well to other constitutional rights.
For Professor Zechariah Chafee, "The writ of habeas corpus is "the
most important human rights provision in the fundamental law,""9 For
Justice Cardozo, on the other hand, freedom of expression "is the
matrix, the indispensable condition of nearly every other form of
freedom." 10
The point is that care must be taken in assigning values to
constitutional rights for the purpose of calibrating them on the judicial
scale, especially if this means employing stricter standards of review for
regulations alleged to infringe certain rights deemed to be "most valued
by civilized men.''
Indeed, the majority concedes that "the right of privacy does not bar all
incursions into individual privacy . . . [only that such] incursions into the
right must be accompanied by proper safeguards and well-defined
standards to prevent unconstitutional invasions." 11 In the case of the
Identification Reference System, the purpose is to facilitate the
transaction of business with service agencies of the government and to
prevent fraud and misrepresentation. The personal identification of an
individual can facilitate his treatment in any government hospital in case
of emergency. On the other hand, the delivery of material assistance,
such as free medicines, can be protected from fraud or
misrepresentation as the absence of a data base makes it possible for
unscrupulous individuals to obtain assistance from more than one
government agency.
Second. Thus, the issue in this case is not really whether A.O. No. 308
violates the right of privacy formed by emanations from the several
violates freedom of thought and of conscience guaranteed in the
following provisions of our Bill of Rights (Art. III):
Sec. 4. No law Shall be passed abridging the
freedom of speech, of expression, or of the press, or
the right of the people peaceably to assemble and
petition the government for redress of grievances.
Sec. 5. No law shall be made respecting an
establishment of religion, or prohibiting the free
exercise thereof. The free exercise enjoyment of
religious profession and worship, without
discrimination or preference, shall be forever be
allowed. No religious test shall be required for the
exercise of civil or political rights.
More specifically, the question is whether the establishment of the
Identification Reference System will not result in the compilation of
massive dossiers on individuals which, beyond their use for
identification, can become instruments of thought control. So far, the
next of A.O. No. 308 affords no basis for believing that the data
gathered can be used for such sinister purpose. As already stated,
nothing that is not already being required by the concerned agencies of
those making use of their servides is required by the Order in question.
The Order simply organizes service agencies of the government into a
System for the purpose of facilitating the identification of persons
seeking basic services and social security. Thus, the whereas clauses
of A.O. No. 308 state:
WHEREAS, there is a need to provide Filipino
citizens and foreign residents with the facility to
conveniently transact business with basic services
and social security providers and other government
instrumentalities;
WHEREAS, this will require a computerized system
to properly and efficiently identify persons seeking
basic services and social security, and reduce, if not
totally eradicate, fraudulent transactions and
misrepresentations;
WHEREAS, a concerted and collaborative effort
among the various basic services and social security
providing agencies and other government
instrumentalities is required to achieve such a
system:
The application of biometric technology and the
standardization of computer designs can provide service
agencies with precise identification of individuals, but what is
wrong with that?
Indeed, A.O. No. 308 is no more than a directive to government
agencies which the President of the Philippines has issued in his
capacity as administrative head. 13 It is not a statute. It confers no
right; it imposes no duty; it affords no protection; it creates no office. 14
It is, as its name indicates, a mere administrative order, the prescise
nature of which is given in the following excerpt from the decision in the
early case of Olsen & Co. v. Herstein: 15
[It] is nothing more or less than a command from a
superior to an inferior. It creates no relation except
between the official who issues it and the official
who receives it. Such orders, whether executive or
departmental, have for their object simply the
efficient and economical administration of the affairs
of the department to which or in which they are
issued in accordance with the law governing the
subject-matter. They are administrative in their
nature and do not pass beyond the limits of the
department to which they are directed or in which
they are published, and, therefore, create no rights
in third persons. They are based on, and are the
product of a relationship in which power is their
source and obedience their object. Disobedience to
or deviation from such an order can be punished
only by the power which issued it: and, if that power
fails to administer the corrective, then the
disobedience goes unpunished. In that relationship
no third person or official may intervene, not even
the court. Such orders may be very temporary, they
being subject to instant revocation or modification by
the power which published them. Their very nature,
as determined by the relationship which prodecued
them, demonstrates clearly the impossibility of any
other person enforcing them except the one who
created them. An attempt on the part of the courts to
enforce such orders would result not only in
 confusion but, substantially, in departmental anarchy
also. 16
Third. There is no basis for believing that, beyond the identification of
individuals, the System will be used for illegal purposes. Nor are
sanctions lacking for the unauthorized use or disclosure of information
gathered by the various agencies constituting the System. For example,
as the Solicitor General points out. C.A. No. 591. §4 penalizes the
unauthorized use or disclosure of data furnished the NSO with a fine of
not more than P600.00 or imprisonment for not more than six months or
both.
At all events, at this stage, it is premature to pass on the claim that the
Identification Reference System can be used for the purpose of
compiling massive dossiers on individuals that can be used to curtail
basic civil and political rights since, if at all, this can only be provided in
the implementing rules and regulations which have yet to be
promulgated. We have already stated that A.O. No. 308 is not a statute.
Even in the case of statutes, however, where implementing rules are
necessary to put them into effect, it has been held that an attack on
their constitutionality would be premature. 17 As Edgar in King Lear
puts it, "Ripeness is all." 18 For, to borrow some more Shakespearean
lines,
The canker galls the infants of
the spring
Too oft before their buttons be
disclos'd. 19
That, more than any doctrine of constitutional law I can think
of, succinctly expresses the rule on ripeness, prematurity, and
hypothetical, speculative, or conjectural claims.
Of special relevance to this case is Laird v. Tatum. 20 There, a class
suit was brought seeking declaratory and injunctive relief on the claim
that a U.S. Army intelligence surveillance of civilian political activity
having "a potential for civil disorder" exercised "a present inhibiting
effect on [respondents'] full expression and utilization of their First
Amendment rights." In holding the case nonjusticiable, the U.S.
Supreme Court, in an opinion by Chief Justice Burger. said: 21
In recent years this Court has found in a number of
cases that constitutional violations may arise from
the deterrent or ''chilling," effect of governmental
regulations that fall short of a direct prohibition
against the exercise of First Amendment rights.
[Citation of cases omitted] In none of these cases,
however, did the chilling effect arise merely from the
individual's knowledge that a governmental agency
was engaged in certain activities or from the
individual's concomitant fear that, armed with the
fruits of those activities, the agency might in the
future take some other and additional action
detrimental to that individual. Rather, in each of
these cases, the challenged exercise of
governmental power was regulatory, proscriptive, or
compulsory in nature, and the complainant was
either presently or prospectively subject to the
regulations, proscriptions, or compulsions that he
was challenging. . . .
[T]hese decisions have in no way eroded the
"established principle that to entitle a private
individual to invoke the judicial power to determine
the validity of executive or legislative action he must
show that he was sustained or is immediately in
danger of sustaining a direct injury as the result of
that action. . . .
The respondents do not meet this test; [the] alleged
"chilling" effect may perhaps be seen as arising from
respondents' perception of the system as
inappropriate to the Army's role under our form of
government, or as arising from respondents' beliefs
that it is inherently dangerous for the military to be
concerned with activities in the civilian sector, or as
arising from respondents' less generalized yet
speculative apprehensiveness that the Army may at
some future date misuse the information in some
way that would cause direct harm to respondents.
Allegations of a subjective "chill" are not an
adequate substitute for a claim of specific present
objective harm or a threat of specific future harm:
"the federal courts established pursuant to Article III
of the Constitution do not render advisory opinions."
United Public Workers v. Mitchell, 330 US 75, 89, 91
L Ed 754, 766, 67 S Ct 556 (1947).
Fourth. Given the fact that no right of privacy is involved in this case
and that any objection to the identification Reference System on the
ground that it violates freedom of thought is premature, speculative, or
conjectural pending the issuance of the implementing rules, it is clear
that petitioner Blas F. Ople has no cause of action and, therefore, no
standing to bring this action. Indeed, although he assails A.O. No. 308
on the ground that it violates the right of privacy, he claims no personal
injury suffered as a result of the Order in question. Instead, he says he
is bringing this action as taxpayer, Senator, and member of the
Government Service Insurance System.
Insofar as petitioner claims an interest as taxpayer, it is sufficient to say
that A.O. No. 308 does not involve the exercise of the taxing or
spending power of the government.
Insofar as he purports to sue as a member of the GSIS, neither does
petitioner have an intertest sufficient to enable him to litigate a
constitutional question. Petitioner claims that in providing that the funds
necessary for implementing the System shall be taken from the budgets
of the concerned agencies. A.O. No. 308 violates Art. VI, §25(5) which.
provides:
No law shall be passed authorizing any transfer of
appropriations; however, the President, the
President of the Senate, the Speaker of the House
of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional
Commissions may, by law, be authorized to
augment any item in the general appropriations law
for their respective offices from savings in other
items of their respective appropriations.
But, as the Solicitor General states:
Petitioner's argument is anchored on two erroneous
assumptions: one, that all the concerned agencies,
including the SSS and the GSIS, receive budgetary
support from the national government; and two, that
the GAA is the only law whereby public funds are
appropriated. Both assumptions are wrong.
The SSS and GSIS do not presently receive
budgetary support from the National Government.
They have achieved self-supporting status such that
the contributions of their members are sufficient to
finance their expenses. One would be hard pressed
to find in the GAA an appropriation of funds to the
SSS and the GSIS.
Furthermore, their respective charters authorize the
SSS and the GSIS to disburse their funds (Rep. Act
No. 1161 [1954], as amended, Sec. 25; Pres.
Decree No. 1146 [1977], as amended, Sec. 29)
without the need for a separate appropriation from
the Congress.
Nor as Senator can petitioner claim standing since no power of
Congress is alleged to have been impaired by the Administrative Order
in question. 22 As already stated, in issuing A.O. No. 308, the President
did not exercise the legislative power vested by the Constitution in
Congress. He acted on the basis of his own powers as administrative
head of the government, as distinguished from his capacity as the
Executive. Dean Sinco elucidates the crucial distinction thus:
The Constitution of the Philippines makes the
President not only the executive but also the
administrative head of the government. . . .
Executive power refers to the legal and political
function of the President involving the exercise of
discretion. Administrative power, on the other hand,
concerns itself with the work of applying policies and
enforcing orders as determined by proper
governmental organs. These two functions are often
confused by the public: but they are distinct from
each other. The President as the executive authority
has the duty of supervising the enforcement of laws
for the maintenance of general peace and public
order. As administrative head, his duty is to see that
every government office is managed and maintained
properly by the persons in charge of it in accordance
with pertinent laws and regulations.
. . . The power of control vested in him by the
Constitution makes for a strongly centralized
administrative system. It reinforces further his
position as the executive of the government,
enabling him to comply more effectively with his
constitutional duty to enforce the laws. It enables
him to fix a uniform standard of a administrative
eficiency and to check the official conduct of his
agents. The decisions of all the officers within his
department are subject to his power of revision,
either on his own motion or on the appeal of some
individual who might deem himself aggrieved by the
action of an administrative official. In case of serious
dereliction of duty, he may suspend or remove the
officials concerned. 23
For the foregoing reasons, the petition should be DISMISSED.
G.R. No. L-45685             November 16, 1937
THE PEOPLE OF THE PHILIPPINE ISLANDS and HONGKONG &
SHANGHAI BANKING CORPORATION, petitioners,
vs.
JOSE O. VERA, Judge . of the Court of First Instance of Manila,
and MARIANO CU UNJIENG, respondents.
Office of the Solicitor General Tuason and City Fiscal Diaz for the
Government.
De Witt, Perkins and Ponce Enrile for the Hongkong and Shanghai
Banking Corporation.
Vicente J. Francisco, Feria and La O, Orense and Belmonte, and Gibbs
and McDonough for respondent Cu Unjieng.
No appearance for respondent Judge.
LAUREL, J.:
This is an original action instituted in this court on August 19, 1937, for
the issuance of the writ of certiorari and of prohibition to the Court of
First Instance of Manila so that this court may review the actuations of
the aforesaid Court of First Instance in criminal case No. 42649 entitled
"The People of the Philippine Islands vs. Mariano Cu Unjieng, et al.",
more particularly the application of the defendant Mariano Cu Unjieng
therein for probation under the provisions of Act No. 4221, and
thereafter prohibit the said Court of First Instance from taking any
further action or entertaining further the aforementioned application for
probation, to the end that the defendant Mariano Cu Unjieng may be
forthwith committed to prison in accordance with the final judgment of
conviction rendered by this court in said case (G. R. No. 41200). 1
Petitioners herein, the People of the Philippine and the Hongkong and
Shanghai Banking Corporation, are respectively the plaintiff and the
offended party, and the respondent herein Mariano Cu Unjieng is one
of the defendants, in the criminal case entitled "The People of the
Philippine Islands vs. Mariano Cu Unjieng, et al.", criminal case No.
42649 of the Court of First Instance of Manila and G.R. No. 41200 of
this court. Respondent herein, Hon. Jose O. Vera, is the Judge ad
interim of the seventh branch of the Court of First Instance of Manila,
who heard the application of the defendant Mariano Cu Unjieng for
probation in the aforesaid criminal case.
The information in the aforesaid criminal case was filed with the Court
of First Instance of Manila on October 15, 1931, petitioner herein
Hongkong and Shanghai Banking Corporation intervening in the case
as private prosecutor. After a protracted trial unparalleled in the annals
of Philippine jurisprudence both in the length of time spent by the court
as well as in the volume in the testimony and the bulk of the exhibits
presented, the Court of First Instance of Manila, on January 8, 1934,
rendered a judgment of conviction sentencing the defendant Mariano
Cu Unjieng to indeterminate penalty ranging from four years and two
months of prision correccional to eight years of prision mayor, to pay
the costs and with reservation of civil action to the offended party, the
Hongkong and Shanghai Banking Corporation. Upon appeal, the court,
on March 26, 1935, modified the sentence to an indeterminate penalty
of from five years and six months of prision correccional to seven years,
six months and twenty-seven days of prision mayor, but affirmed the
judgment in all other respects. Mariano Cu Unjieng filed a motion for
reconsideration and four successive motions for new trial which were
denied on December 17, 1935, and final judgment was accordingly
entered on December 18, 1935. The defendant thereupon sought to
have the case elevated on certiorari to the Supreme Court of the United
States but the latter denied the petition for certiorari in             upon objection of counsel for Mariano Cu Unjieng, he moved for the
November, 1936. This court, on             November 24, 1936, denied the
petition subsequently filed by the defendant for leave to file a second
alternative motion for reconsideration or new trial and thereafter
remanded the case to the court of origin for execution of the judgment.
The instant proceedings have to do with the application for probation
filed by the herein respondent Mariano Cu Unjieng on            
November 27, 1936, before the trial court, under the provisions of Act
No. 4221 of the defunct Philippine Legislature. Herein respondent
Mariano Cu Unjieng states in his petition, inter alia, that he is innocent
of the crime of which he was convicted, that he has no criminal record
and that he would observe good conduct in the future. The Court of
First Instance of Manila, Judge Pedro Tuason presiding, referred the
application for probation of the Insular Probation Office which
recommended denial of the same June 18, 1937. Thereafter, the Court
of First Instance of Manila, seventh branch, Judge Jose O. Vera
presiding, set the petition for hearing on April 5, 1937.
On April 2, 1937, the Fiscal of the City of Manila filed an opposition to
the granting of probation to the herein respondent Mariano Cu Unjieng.
The private prosecution also filed an opposition on April 5, 1937,
alleging, among other things, that Act No. 4221, assuming that it has
not been repealed by section 2 of Article XV of the Constitution, is
nevertheless violative of section 1, subsection (1), Article III of the
Constitution guaranteeing equal protection of the laws for the reason
that its applicability is not uniform throughout the Islands and because
section 11 of the said Act endows the provincial boards with the power
to make said law effective or otherwise in their respective or otherwise
in their respective provinces. The private prosecution also filed a
supplementary opposition on April 19, 1937, elaborating on the alleged
unconstitutionality on Act No. 4221, as an undue delegation of
legislative power to the provincial boards of several provinces (sec. 1,
Art. VI, Constitution). The City Fiscal concurred in the opposition of the
private prosecution except with respect to the questions raised
concerning the constitutionality of Act No. 4221.
On June 28, 1937, herein respondent Judge Jose O. Vera promulgated
a resolution with a finding that "las pruebas no han establecido de
unamanera concluyente la culpabilidad del peticionario y que todos los
hechos probados no son inconsistentes o incongrentes con su
inocencia" and concludes that the herein respondent Mariano Cu
Unjieng "es inocente por duda racional" of the crime of which he stands
convicted by this court in G.R. No. 41200, but denying the latter's
petition for probation for the reason that:
. . . Si este Juzgado concediera la poblacion solicitada por las
circunstancias y la historia social que se han expuesto en el
cuerpo de esta resolucion, que hacen al peticionario acreedor
de la misma, una parte de la opinion publica, atizada por los
recelos y las suspicacias, podria levantarse indignada contra
un sistema de probacion que permite atisbar en los
procedimientos ordinarios de una causa criminal perturbando
la quietud y la eficacia de las decisiones ya recaidas al traer a
la superficie conclusiones enteramente differentes, en
menoscabo del interes publico que demanda el respeto de las
leyes y del veredicto judicial.
On July 3, 1937, counsel for the herein respondent Mariano Cu Unjieng
filed an exception to the resolution denying probation and a notice of
intention to file a motion for reconsideration. An alternative motion for
reconsideration or new trial was filed by counsel on July 13, 1937. This
was supplemented by an additional motion for reconsideration
submitted on July 14, 1937. The aforesaid motions were set for hearing
on July 31, 1937, but said hearing was postponed at the petition of
counsel for the respondent Mariano Cu Unjieng because a motion for
leave to intervene in the case as amici curiae signed by thirty-three
(thirty-four) attorneys had just been filed with the trial court. Attorney
Eulalio Chaves whose signature appears in the aforesaid motion
subsequently filed a petition for leave to withdraw his appearance as
amicus curiae on the ground that the motion for leave to intervene as
amici curiae was circulated at a banquet given by counsel for Mariano
Cu Unjieng on the evening of July 30, 1937, and that he signed the
same "without mature deliberation and purely as a matter of courtesy to
the person who invited me (him)."
On August 6, 1937, the Fiscal of the City of Manila filed a motion with
the trial court for the issuance of an order of execution of the judgment
of this court in said case and forthwith to commit the herein respondent
Mariano Cu Unjieng to jail in obedience to said judgment.
On August 7, 1937, the private prosecution filed its opposition to the
motion for leave to intervene as amici curiae aforementioned, asking
that a date be set for a hearing of the same and that, at all events, said
motion should be denied with respect to certain attorneys signing the
same who were members of the legal staff of the several counsel for
Mariano Cu Unjieng. On August 10, 1937, herein respondent Judge
Jose O. Vera issued an order requiring all parties including the movants
for intervention as amici curiae to appear before the court on August
14, 1937. On the last-mentioned date, the Fiscal of the City of Manila
moved for the hearing of his motion for execution of judgment in
preference to the motion for leave to intervene as amici curiae but,
postponement of the hearing of both motions. The respondent judge
thereupon set the hearing of the motion for execution on August 21,
1937, but proceeded to consider the motion for leave to intervene as
amici curiae as in order. Evidence as to the circumstances under which
said motion for leave to intervene as amici curiae was signed and
submitted to court was to have been heard on August 19, 1937. But at
this juncture, herein petitioners came to this court on extraordinary legal
process to put an end to what they alleged was an interminable
proceeding in the Court of First Instance of Manila which fostered "the
campaign of the defendant Mariano Cu Unjieng for delay in the
execution of the sentence imposed by this Honorable Court on him,
exposing the courts to criticism and ridicule because of the apparent
inability of the judicial machinery to make effective a final judgment of
this court imposed on the defendant Mariano Cu Unjieng."
The scheduled hearing before the trial court was accordingly
suspended upon the issuance of a temporary restraining order by this
court on August 21, 1937.
To support their petition for the issuance of the extraordinary writs of
certiorari and prohibition, herein petitioners allege that the respondent
judge has acted without jurisdiction or in excess of his jurisdiction:
I. Because said respondent judge lacks the power to place respondent
Mariano Cu Unjieng under probation for the following reason:
(1) Under section 11 of Act No. 4221, the said of the
Philippine Legislature is made to apply only to the
provinces of the Philippines; it nowhere states that it
is to be made applicable to chartered cities like the
City of Manila.
 (2) While section 37 of the Administrative Code
contains a proviso to the effect that in the absence
of a special provision, the term "province" may be
construed to include the City of Manila for the
purpose of giving effect to laws of general
application, it is also true that Act No. 4221 is not a
law of general application because it is made to
apply only to those provinces in which the respective
provincial boards shall have provided for the salary
of a probation officer.
(3) Even if the City of Manila were considered to be
a province, still, Act No. 4221 would not be
applicable to it because it has provided for the salary
of a probation officer as required by section 11
thereof; it being immaterial that there is an Insular
Probation Officer willing to act for the City of Manila,
said Probation Officer provided for in section 10 of
Act No. 4221 being different and distinct from the
Probation Officer provided for in section 11 of the
same Act.
II. Because even if the respondent judge originally had jurisdiction to
entertain the application for probation of the respondent Mariano Cu
Unjieng, he nevertheless acted without jurisdiction or in excess thereof
in continuing to entertain the motion for reconsideration and by failing to
commit Mariano Cu Unjieng to prison after he had promulgated his
resolution of June 28, 1937, denying Mariano Cu Unjieng's application
for probation, for the reason that:
(1) His jurisdiction and power in probation
proceedings is limited by Act No. 4221 to the
granting or denying of applications for probation.
(2) After he had issued the order denying Mariano
Cu Unjieng's petition for probation on June 28,
1937, it became final and executory at the moment
of its rendition.
(3) No right on appeal exists in such cases.
(4) The respondent judge lacks the power to grant a
rehearing of said order or to modify or change the
same.
III. Because the respondent judge made a finding that Mariano Cu
Unjieng is innocent of the crime for which he was convicted by final
judgment of this court, which finding is not only presumptuous but
without foundation in fact and in law, and is furthermore in contempt of
this court and a violation of the respondent's oath of office as ad interim
judge of first instance.
IV. Because the respondent judge has violated and continues to violate
his duty, which became imperative when he issued his order of June
28, 1937, denying the application for probation, to commit his co-
respondent to jail.
Petitioners also avers that they have no other plain, speedy and
adequate remedy in the ordinary course of law.
In a supplementary petition filed on September 9, 1937, the petitioner
Hongkong and Shanghai Banking Corporation further contends that Act
No. 4221 of the Philippine Legislature providing for a system of
probation for persons eighteen years of age or over who are convicted
of crime, is unconstitutional because it is violative of section 1,
subsection (1), Article III, of the Constitution of the Philippines
guaranteeing equal protection of the laws because it confers upon the
provincial board of its province the absolute discretion to make said law
operative or otherwise in their respective provinces, because it
constitutes an unlawful and improper delegation to the provincial
boards of the several provinces of the legislative power lodged by the
Jones Law (section 8) in the Philippine Legislature and by the
Constitution (section 1, Art. VI) in the National Assembly; and for the
further reason that it gives the provincial boards, in contravention of the
Constitution (section 2, Art. VIII) and the Jones Law (section 28), the
authority to enlarge the powers of the Court of First Instance of different
provinces without uniformity. In another supplementary petition dated
September 14, 1937, the Fiscal of the City of Manila, in behalf of one of
the petitioners, the People of the Philippine Islands, concurs for the first
time with the issues raised by other petitioner regarding the
constitutionality of Act No. 4221, and on the oral argument held on
October 6, 1937, further elaborated on the theory that probation is a
form of reprieve and therefore Act. No. 4221 is an encroachment on the
exclusive power of the Chief Executive to grant pardons and reprieves.
On October 7, 1937, the City Fiscal filed two memorandums in which
he contended that Act No. 4221 not only encroaches upon the
pardoning power to the executive, but also constitute an unwarranted
delegation of legislative power and a denial of the equal protection of
the laws. On October 9, 1937, two memorandums, signed jointly by the
City Fiscal and the Solicitor-General, acting in behalf of the People of
the Philippine Islands, and by counsel for the petitioner, the Hongkong
and Shanghai Banking Corporation, one sustaining the power of the
state to impugn the validity of its own laws and the other contending
that Act No. 4221 constitutes an unwarranted delegation of legislative
power, were presented. Another joint memorandum was filed by the
same persons on the same day, October 9, 1937, alleging that Act No.
4221 is unconstitutional because it denies the equal protection of the
laws and constitutes an unlawful delegation of legislative power and,
further, that the whole Act is void: that the Commonwealth is not
estopped from questioning the validity of its laws; that the private
prosecution may intervene in probation proceedings and may attack the
probation law as unconstitutional; and that this court may pass upon the
constitutional question in prohibition proceedings.
Respondents in their answer dated August 31, 1937, as well as in their
oral argument and memorandums, challenge each and every one of the
foregoing proposition raised by the petitioners.
As special defenses, respondents allege:
(1) That the present petition does not state facts
sufficient in law to warrant the issuance of the writ of
certiorari or of prohibition.
(2) That the aforesaid petition is premature because
the remedy sought by the petitioners is the very
same remedy prayed for by them before the trial
court and was still pending resolution before the trial
court when the present petition was filed with this
court.
(3) That the petitioners having themselves raised the
question as to the execution of judgment before the
trial court, said trial court has acquired exclusive
jurisdiction to resolve the same under the theory that
its resolution denying probation is unappealable.
(4) That upon the hypothesis that this court has
concurrent jurisdiction with the Court of First
Instance to decide the question as to whether or not
the execution will lie, this court nevertheless cannot
exercise said jurisdiction while the Court of First
Instance has assumed jurisdiction over the same
upon motion of herein petitioners themselves.
(5) That upon the procedure followed by the herein
petitioners in seeking to deprive the trial court of its
jurisdiction over the case and elevate the
proceedings to this court, should not be tolerated
because it impairs the authority and dignity of the
trial court which court while sitting in the probation
cases is "a court of limited jurisdiction but of great
dignity."
(6) That under the supposition that this court has
jurisdiction to resolve the question submitted to and
pending resolution by the trial court, the present
action would not lie because the resolution of the
trial court denying probation is appealable; for
although the Probation Law does not specifically
provide that an applicant for probation may appeal
from a resolution of the Court of First Instance
denying probation, still it is a general rule in this
jurisdiction that a final order, resolution or decision
of an inferior court is appealable to the superior
court.
(7) That the resolution of the trial court denying
probation of herein respondent Mariano Cu Unjieng
being appealable, the same had not become final
and executory for the reason that the said
respondent had filed an alternative motion for
reconsideration and new trial within the requisite
period of fifteen days, which motion the trial court
was able to resolve in view of the restraining order
improvidently and erroneously issued by this
court.lawphi1.net
(8) That the Fiscal of the City of Manila had by
implication admitted that the resolution of the trial
court denying probation is not final and
unappealable when he presented his answer to the
motion for reconsideration and agreed to the
postponement of the hearing of the said motion.
(9) That under the supposition that the order of the
trial court denying probation is not appealable, it is
incumbent upon the accused to file an action for the
issuance of the writ of certiorari with mandamus, it
appearing that the trial court, although it believed
that the accused was entitled to probation,
nevertheless denied probation for fear of criticism
because the accused is a rich man; and that, before
a petition for certiorari grounded on an irregular
exercise of jurisdiction by the trial court could lie, it is
incumbent upon the petitioner to file a motion for
reconsideration specifying the error committed so
that the trial court could have an opportunity to
correct or cure the same.
 (10) That on hypothesis that the resolution of this
court is not appealable, the trial court retains its
jurisdiction within a reasonable time to correct or
modify it in accordance with law and justice; that this
power to alter or modify an order or resolution is
inherent in the courts and may be exercise either
motu proprio or upon petition of the proper party, the
petition in the latter case taking the form of a motion
for reconsideration.
(11) That on the hypothesis that the resolution of the
trial court is appealable as respondent allege, said
court cannot order execution of the same while it is
on appeal, for then the appeal would not be availing
because the doors of probation will be closed from
the moment the accused commences to serve his
sentence (Act No. 4221, sec. 1; U.S. vs. Cook, 19
Fed. [2d], 827).
In their memorandums filed on October 23, 1937, counsel for the
respondents maintain that Act No. 4221 is constitutional because,
contrary to the allegations of the petitioners, it does not constitute an
undue delegation of legislative power, does not infringe the equal
protection clause of the Constitution, and does not encroach upon the
pardoning power of the Executive. In an additional memorandum filed
on the same date, counsel for the respondents reiterate the view that
section 11 of Act No. 4221 is free from constitutional objections and
contend, in addition, that the private prosecution may not intervene in
probation proceedings, much less question the validity of Act No. 4221;
that both the City Fiscal and the Solicitor-General are estopped from
questioning the validity of the Act; that the validity of Act cannot be
attacked for the first time before this court; that probation in unavailable;
and that, in any event, section 11 of the Act No. 4221 is separable from
the rest of the Act. The last memorandum for the respondent Mariano
Cu Unjieng was denied for having been filed out of time but was
admitted by resolution of this court and filed anew on             November
5, 1937. This memorandum elaborates on some of the points raised by
the respondents and refutes those brought up by the petitioners.
In the scrutiny of the pleadings and examination of the various aspects
of the present case, we noted that the court below, in passing upon the
merits of the application of the respondent Mariano Cu Unjieng and in
denying said application assumed the task not only of considering the
merits of the application, but of passing upon the culpability of the
applicant, notwithstanding the final pronouncement of guilt by this court.
(G.R. No. 41200.) Probation implies guilt be final judgment. While a
probation case may look into the circumstances attending the
commission of the offense, this does not authorize it to reverse the
findings and conclusive of this court, either directly or indirectly,
especially wherefrom its own admission reliance was merely had on the
printed briefs, averments, and pleadings of the parties. As already
observed by this court in Shioji vs. Harvey ([1922], 43 Phil., 333, 337),
and reiterated in subsequent cases, "if each and every Court of First
Instance could enjoy the privilege of overruling decisions of the
Supreme Court, there would be no end to litigation, and judicial chaos
would result." A becoming modesty of inferior courts demands
conscious realization of the position that they occupy in the interrelation
and operation of the intergrated judicial system of the nation.
After threshing carefully the multifarious issues raised by both counsel
for the petitioners and the respondents, this court prefers to cut the
Gordian knot and take up at once the two fundamental questions
presented, namely, (1) whether or not the constitutionality of Act No.
4221 has been properly raised in these proceedings; and (2) in the
affirmative, whether or not said Act is constitutional. Considerations of
these issues will involve a discussion of certain incidental questions
raised by the parties.
To arrive at a correct conclusion on the first question, resort to certain
guiding principles is necessary. It is a well-settled rule that the
constitutionality of an act of the legislature will not be determined by the
courts unless that question is properly raised and presented
inappropriate cases and is necessary to a determination of the case;
i.e., the issue of constitutionality must be the very lis mota presented.
(McGirr vs. Hamilton and Abreu [1915], 30 Phil., 563, 568; 6 R. C. L.,
pp. 76, 77; 12 C. J., pp. 780-782, 783.)
The question of the constitutionality of an act of the legislature is
frequently raised in ordinary actions. Nevertheless, resort may be made
to extraordinary legal remedies, particularly where the remedies in the
ordinary course of law even if available, are not plain, speedy and
adequate. Thus, in Cu Unjieng vs. Patstone ([1922]), 42 Phil., 818), this
court held that the question of the constitutionality of a statute may be
raised by the petitioner in mandamus proceedings (see, also, 12 C. J.,
p. 783); and in Government of the Philippine Islands vs. Springer
([1927], 50 Phil., 259 [affirmed in Springer vs. Government of the
Philippine Islands (1928), 277 U. S., 189; 72 Law. ed., 845]), this court
declared an act of the legislature unconstitutional in an action of quo
warranto brought in the name of the Government of the Philippines. It
has also been held that the constitutionality of a statute may be
questioned in habeas corpus proceedings (12 C. J., p. 783; Bailey on
Habeas Corpus, Vol. I, pp. 97, 117), although there are authorities to
the contrary; on an application for injunction to restrain action under the
challenged statute (mandatory, see Cruz vs. Youngberg [1931], 56
Phil., 234); and even on an application for preliminary injunction where
the determination of the constitutional question is necessary to a
decision of the case. (12 C. J., p. 783.) The same may be said as
regards prohibition and certiorari.(Yu Cong Eng vs. Trinidad [1925], 47
Phil., 385; [1926], 271 U. S., 500; 70 Law. ed., 1059; Bell vs. First
Judicial District Court [1905], 28 Nev., 280; 81 Pac., 875; 113 A. S. R.,
854; 6 Ann. Cas., 982; 1 L. R. A. [N. S], 843, and cases cited). The
case of Yu Cong Eng vs. Trinidad, supra, decided by this court twelve
years ago was, like the present one, an original action for certiorari and
prohibition. The constitutionality of Act No. 2972, popularly known as
the Chinese Bookkeeping Law, was there challenged by the petitioners,
and the constitutional issue was not met squarely by the respondent in
a demurrer. A point was raised "relating to the propriety of the
constitutional question being decided in original proceedings in
prohibition." This court decided to take up the constitutional question
and, with two justices dissenting, held that Act No. 2972 was
constitutional. The case was elevated on writ of certiorari to the
Supreme Court of the United States which reversed the judgment of
this court and held that the Act was invalid. (271 U. S., 500; 70 Law.
ed., 1059.) On the question of jurisdiction, however, the Federal
Supreme Court, though its Chief Justice, said:
By the Code of Civil Procedure of the Philippine Islands,
section 516, the Philippine supreme court is granted
concurrent jurisdiction in prohibition with courts of first
instance over inferior tribunals or persons, and original
jurisdiction over courts of first instance, when such courts are
exercising functions without or in excess of their jurisdiction. It
has been held by that court that the question of the validity of
the criminal statute must usually be raised by a defendant in
the trial court and be carried regularly in review to the
Supreme Court. (Cadwallader-Gibson Lumber Co. vs. Del
Rosario, 26 Phil., 192). But in this case where a new act
seriously affected numerous persons and extensive property
rights, and was likely to cause a multiplicity of actions, the
Supreme Court exercised its discretion to bring the issue to
the act's validity promptly before it and decide in the interest
of the orderly administration of justice. The court relied by
analogy upon the cases of Ex parte Young (209 U. S., 123;52
Law ed., 714; 13 L. R. A. [N. S.] 932; 28 Sup. Ct. Rep., 441;
14 Ann. Ca., 764; Traux vs. Raich, 239 U. S., 33; 60 Law. ed.,
131; L. R. A. 1916D, 545; 36 Sup. Ct. Rep., 7; Ann. Cas.,
1917B, 283; and Wilson vs. New, 243 U. S., 332; 61 Law. ed.,
755; L. R. A. 1917E, 938; 37 Sup. Ct. Rep., 298; Ann. Cas.
1918A, 1024). Although objection to the jurisdiction was raise
by demurrer to the petition, this is now disclaimed on behalf of
the respondents, and both parties ask a decision on the
merits. In view of the broad powers in prohibition granted to
that court under the Island Code, we acquiesce in the desire
of the parties.
The writ of prohibition is an extraordinary judicial writ issuing out of a
court of superior jurisdiction and directed to an inferior court, for the
purpose of preventing the inferior tribunal from usurping a jurisdiction
with which it is not legally vested. (High, Extraordinary Legal Remedies,
p. 705.) The general rule, although there is a conflict in the cases, is
that the merit of prohibition will not lie whether the inferior court has
jurisdiction independent of the statute the constitutionality of which is
questioned, because in such cases the interior court having jurisdiction
may itself determine the constitutionality of the statute, and its decision
may be subject to review, and consequently the complainant in such
cases ordinarily has adequate remedy by appeal without resort to the
writ of prohibition. But where the inferior court or tribunal derives its
jurisdiction exclusively from an unconstitutional statute, it may be
prevented by the writ of prohibition from enforcing that statute. (50 C.
J., 670; Ex parte Round tree [1874, 51 Ala., 42; In re Macfarland, 30
App. [D. C.], 365; Curtis vs. Cornish [1912], 109 Me., 384; 84 A., 799;
Pennington vs. Woolfolk [1880], 79 Ky., 13; State vs. Godfrey [1903],
54 W. Va., 54; 46 S. E., 185; Arnold vs. Shields [1837], 5 Dana, 19; 30
Am. Dec., 669.)
Courts of First Instance sitting in probation proceedings derived their
jurisdiction solely from Act No. 4221 which prescribes in detailed
manner the procedure for granting probation to accused persons after
their conviction has become final and before they have served their
sentence. It is true that at common law the authority of the courts to
suspend temporarily the execution of the sentence is recognized and,
according to a number of state courts, including those of
Massachusetts, Michigan, New York, and Ohio, the power is inherent in
the courts (Commonwealth vs. Dowdican's Bail [1874], 115 Mass., 133;
People vs. Stickel [1909], 156 Mich., 557; 121 N. W., 497; People ex
rel. Forsyth vs. Court of Session [1894], 141 N. Y., 288; Weber vs.
State [1898], 58 Ohio St., 616). But, in the leading case of Ex parte
United States ([1916], 242 U. S., 27; 61 Law. ed., 129; L. R. A., 1917E,
1178; 37 Sup. Ct. Rep., 72; Ann. Cas. 1917B, 355), the Supreme Court
of the United States expressed the opinion that under the common law
the power of the court was limited to temporary suspension, and
brushed aside the contention as to inherent judicial power saying,
through Chief Justice White:
Indisputably under our constitutional system the right to try
offenses against the criminal laws and upon conviction to
impose the punishment provided by law is judicial, and it is
equally to be conceded that, in exerting the powers vested in
them on such subject, courts inherently possess ample right
to exercise reasonable, that is, judicial, discretion to enable
them to wisely exert their authority. But these concessions
afford no ground for the contention as to power here made,
since it must rest upon the proposition that the power to
enforce begets inherently a discretion to permanently refuse
to do so. And the effect of the proposition urged upon the
distribution of powers made by the Constitution will become
apparent when it is observed that indisputable also is it that
the authority to define and fix the punishment for crime is
legislative and includes the right in advance to bring within
judicial discretion, for the purpose of executing the statute,
elements of consideration which would be otherwise beyond
the scope of judicial authority, and that the right to relieve
from the punishment, fixed by law and ascertained according
to the methods by it provided belongs to the executive
department.
Justice Carson, in his illuminating concurring opinion in the case of
Director of Prisons vs. Judge of First Instance of Cavite (29 Phil., 265),
decided by this court in 1915, also reached the conclusion that the
power to suspend the execution of sentences pronounced in criminal
cases is not inherent in the judicial function. "All are agreed", he said,
"that in the absence of statutory authority, it does not lie within the
power of the courts to grant such suspensions." (at p. 278.) Both
petitioner and respondents are correct, therefore, when they argue that
a Court of First Instance sitting in probation proceedings is a court of
limited jurisdiction. Its jurisdiction in such proceedings is conferred
exclusively by Act No. 4221 of the Philippine Legislature.
It is, of course, true that the constitutionality of a statute will not be
considered on application for prohibition where the question has not
been properly brought to the attention of the court by objection of some
kind (Hill vs. Tarver [1901], 130 Ala., 592; 30 S., 499; State ex rel. Kelly
vs. Kirby [1914], 260 Mo., 120; 168 S. W., 746). In the case at bar, it is
unquestionable that the constitutional issue has been squarely
presented not only before this court by the petitioners but also before
the trial court by the private prosecution. The respondent, Hon. Jose O
Vera, however, acting as judge of the court below, declined to pass
upon the question on the ground that the private prosecutor, not being
a party whose rights are affected by the statute, may not raise said
question. The respondent judge cited Cooley on Constitutional
Limitations (Vol. I, p. 339; 12 C. J., sec. 177, pp. 760 and 762), and
McGlue vs. Essex County ([1916], 225 Mass., 59; 113 N. E., 742, 743),
as authority for the proposition that a court will not consider any attack
made on the constitutionality of a statute by one who has no interest in
defeating it because his rights are not affected by its operation. The
respondent judge further stated that it may not motu proprio take up the
constitutional question and, agreeing with Cooley that "the power to
declare a legislative enactment void is one which the judge, conscious
of the fallibility of the human judgment, will shrink from exercising in any
case where he can conscientiously and with due regard to duty and
official oath decline the responsibility" (Constitutional Limitations, 8th
ed., Vol. I, p. 332), proceeded on the assumption that Act No. 4221 is
constitutional. While therefore, the court a quo admits that the
constitutional question was raised before it, it refused to consider the
question solely because it was not raised by a proper party.
Respondents herein reiterates this view. The argument is advanced
that the private prosecution has no personality to appear in the hearing
of the application for probation of defendant Mariano Cu Unjieng in
criminal case No. 42648 of the Court of First Instance of Manila, and
hence the issue of constitutionality was not properly raised in the lower
court. Although, as a general rule, only those who are parties to a suit
may question the constitutionality of a statute involved in a judicial
decision, it has been held that since the decree pronounced by a court
without jurisdiction is void, where the jurisdiction of the court depends
on the validity of the statute in question, the issue of the constitutionality
will be considered on its being brought to the attention of the court by
persons interested in the effect to be given the statute.(12 C. J., sec.
184, p. 766.) And, even if we were to concede that the issue was not
properly raised in the court below by the proper party, it does not follow
that the issue may not be here raised in an original action of certiorari
and prohibitions. It is true that, as a general rule, the question of
constitutionality must be raised at the earliest opportunity, so that if not
raised by the pleadings, ordinarily it may not be raised at the trial, and if
not raised in the trial court, it will not considered on appeal. (12 C. J., p.
786. See, also, Cadwallader-Gibson Lumber Co. vs. Del Rosario, 26
Phil., 192, 193-195.) But we must state that the general rule admits of
exceptions. Courts, in the exercise of sounds discretion, may determine
the time when a question affecting the constitutionality of a statute
should be presented. (In re Woolsey [1884], 95 N. Y., 135, 144.) Thus,
in criminal cases, although there is a very sharp conflict of authorities, it
is said that the question may be raised for the first time at any stage of
the proceedings, either in the trial court or on appeal. (12 C. J., p. 786.)
Even in civil cases, it has been held that it is the duty of a court to pass
on the constitutional question, though raised for the first time on appeal,
if it appears that a determination of the question is necessary to a
decision of the case. (McCabe's Adm'x vs. Maysville & B. S. R. Co.,
[1910], 136 ky., 674; 124 S. W., 892; Lohmeyer vs. St. Louis Cordage
Co. [1908], 214 Mo., 685; 113 S. W. 1108; Carmody vs. St. Louis
Transit Co., [1905], 188 Mo., 572; 87 S. W., 913.) And it has been held
that a constitutional question will be considered by an appellate court at
any time, where it involves the jurisdiction of the court below (State vs.
Burke [1911], 175 Ala., 561; 57 S., 870.) As to the power of this court to
consider the constitutional question raised for the first time before this
court in these proceedings, we turn again and point with emphasis to
the case of Yu Cong Eng vs. Trinidad, supra. And on the hypotheses
that the Hongkong & Shanghai Banking Corporation, represented by
the private prosecution, is not the proper party to raise the constitutional
question here — a point we do not now have to decide — we are of the
opinion that the People of the Philippines, represented by the Solicitor-
General and the Fiscal of the City of Manila, is such a proper party in
the present proceedings. The unchallenged rule is that the person who
impugns the validity of a statute must have a personal and substantial
interest in the case such that he has sustained, or will sustained, direct
injury as a result of its enforcement. It goes without saying that if Act
No. 4221 really violates the constitution, the People of the Philippines,
in whose name the present action is brought, has a substantial interest
in having it set aside. Of grater import than the damage caused by the
illegal expenditure of public funds is the mortal wound inflicted upon the
fundamental law by the enforcement of an invalid statute. Hence, the
well-settled rule that the state can challenge the validity of its own laws.
In Government of the Philippine Islands vs. Springer ([1927]), 50 Phil.,
259 (affirmed in Springer vs. Government of the Philippine Islands
[1928], 277 U.S., 189; 72 Law. ed., 845), this court declared an act of
the legislature unconstitutional in an action instituted in behalf of the
Government of the Philippines. In Attorney General vs. Perkins ([1889],
73 Mich., 303, 311, 312; 41 N. W. 426, 428, 429), the State of
Michigan, through its Attorney General, instituted quo warranto
proceedings to test the right of the respondents to renew a mining
corporation, alleging that the statute under which the respondents base
their right was unconstitutional because it impaired the obligation of
contracts. The capacity of the chief law officer of the state to question
the constitutionality of the statute was though, as a general rule, only
those who are parties to a suit may question the constitutionality of a
statute involved in a judicial decision, it has been held that since the
decree pronounced by a court without jurisdiction in void, where the
jurisdiction of the court depends on the validity of the statute in
question, the issue of constitutionality will be considered on its being
brought to the attention of the court by persons interested in the effect
to begin the statute. (12 C.J., sec. 184, p. 766.) And, even if we were to
concede that the issue was not properly raised in the court below by the
proper party, it does not follow that the issue may not be here raised in
an original action of certiorari and prohibition. It is true that, as a
general rule, the question of constitutionality must be raised at the
earliest opportunity, so that if not raised by the pleadings, ordinarily it
may not be raised a the trial, and if not raised in the trial court, it will not
be considered on appeal. (12 C.J., p. 786. See, also, Cadwallader-
Gibson Lumber Co. vs. Del Rosario, 26 Phil., 192, 193-195.) But we
must state that the general rule admits of exceptions. Courts, in the
exercise of sound discretion, may determine the time when a question
affecting the constitutionality of a statute should be presented. (In re
Woolsey [19884], 95 N.Y., 135, 144.) Thus, in criminal cases, although
there is a very sharp conflict of authorities, it is said that the question
may be raised for the first time at any state of the proceedings, either in
the trial court or on appeal. (12 C.J., p. 786.) Even in civil cases, it has
been held that it is the duty of a court to pass on the constitutional
question, though raised for first time on appeal, if it appears that a
determination of the question is necessary to a decision of the case.
(McCabe's Adm'x vs. Maysville & B. S. R. Co. [1910], 136 Ky., 674; 124
S. W., 892; Lohmeyer vs. St. Louis, Cordage Co. [1908], 214 Mo. 685;
113 S. W., 1108; Carmody vs. St. Louis Transit Co. [1905], 188 Mo.,
572; 87 S. W., 913.) And it has been held that a constitutional question
will be considered by an appellate court at any time, where it involves
the jurisdiction of the court below (State vs. Burke [1911], 175 Ala., 561;
57 S., 870.) As to the power of this court to consider the constitutional
question raised for the first time before this court in these proceedings,
we turn again and point with emphasis to the case of Yu Cong Eng. vs.
Trinidad, supra. And on the hypothesis that the Hongkong & Shanghai
Banking Corporation, represented by the private prosecution, is not the
proper party to raise the constitutional question here — a point we do
not now have to decide — we are of the opinion that the People of the
Philippines, represented by the Solicitor-General and the Fiscal of the
City of Manila, is such a proper party in the present proceedings. The
unchallenged rule is that the person who impugns the validity of a
statute must have a personal and substantial interest in the case such
that he has sustained, or will sustain, direct injury as a result of its
enforcement. It goes without saying that if Act No. 4221 really violates
the Constitution, the People of the Philippines, in whose name the
present action is brought, has a substantial interest in having it set
aside. Of greater import than the damage caused by the illegal
expenditure of public funds is the mortal wound inflicted upon the
fundamental law by the enforcement of an invalid statute. Hence, the
well-settled rule that the state can challenge the validity of its own laws.
In Government of the Philippine Islands vs. Springer ([1927]), 50 Phil.,
259 (affirmed in Springer vs. Government of the Philippine Islands
[1928], 277 U.S., 189; 72 Law. ed., 845), this court declared an act of
the legislature unconstitutional in an action instituted in behalf of the
Government of the Philippines. In Attorney General vs. Perkings([1889],
73 Mich., 303, 311, 312; 41 N.W., 426, 428, 429), the State of
Michigan, through its Attorney General, instituted quo warranto
proceedings to test the right of the respondents to renew a mining
corporation, alleging that the statute under which the respondents base
their right was unconstitutional because it impaired the obligation of
contracts. The capacity of the chief law officer of the state to question
the constitutionality of the statute was itself questioned. Said the
Supreme Court of Michigan, through Champlin, J.:
. . . The idea seems to be that the people are estopped from
questioning the validity of a law enacted by their
representatives; that to an accusation by the people of
Michigan of usurpation their government, a statute enacted by
the people of Michigan is an adequate answer. The last
proposition is true, but, if the statute relied on in justification is
unconstitutional, it is statute only in form, and lacks the force
of law, and is of no more saving effect to justify action under it
than if it had never been enacted. The constitution is the
supreme law, and to its behests the courts, the legislature,
and the people must bow . . . The legislature and the
respondents are not the only parties in interest upon such
constitutional questions. As was remarked by Mr. Justice
Story, in speaking of an acquiescence by a party affected by
an unconstitutional act of the legislature: "The people have a
deep and vested interest in maintaining all the constitutional
limitations upon the exercise of legislative powers." (Allen vs.
Mckeen, 1 Sum., 314.)
In State vs. Doane ([1916], 98 Kan., 435; 158 Pac., 38, 40), an original
action (mandamus) was brought by the Attorney-General of Kansas to
test the constitutionality of a statute of the state. In disposing of the
question whether or not the state may bring the action, the Supreme
Court of Kansas said:
. . . the state is a proper party — indeed, the proper party —
to bring this action. The state is always interested where the
integrity of its Constitution or statutes is involved.
"It has an interest in seeing that the will of
the Legislature is not disregarded, and
need not, as an individual plaintiff must,
show grounds of fearing more specific
injury. (State vs. Kansas City 60 Kan., 518
[57 Pac., 118])." (State vs. Lawrence, 80
Kan., 707; 103 Pac., 839.)
Where the constitutionality of a statute is in doubt the state's
law officer, its Attorney-General, or county attorney, may
exercise his bet judgment as to what sort of action he will
bring to have the matter determined, either by quo warranto to
challenge its validity (State vs. Johnson, 61 Kan., 803; 60
Pac., 1068; 49 L.R.A., 662), by mandamus to compel
obedience to its terms (State vs. Dolley, 82 Kan., 533; 108
Pac., 846), or by injunction to restrain proceedings under its
questionable provisions (State ex rel. vs. City of Neodesha, 3
Kan. App., 319; 45 Pac., 122).
Other courts have reached the same conclusion (See State vs. St.
Louis S. W. Ry. Co. [1917], 197 S. W., 1006; State vs. S.H. Kress &
Co. [1934], 155 S., 823; State vs. Walmsley [1935], 181 La., 597; 160
S., 91; State vs. Board of County Comr's [1934], 39 Pac. [2d], 286; First
Const. Co. of Brooklyn vs. State [1917], 211 N.Y., 295; 116 N.E., 1020;
Bush vs. State {1918], 187 Ind., 339; 119 N.E., 417; State vs. Watkins
[1933], 176 La., 837; 147 S., 8, 10, 11). In the case last cited, the
Supreme Court of Luisiana said:
It is contended by counsel for Herbert Watkins that a district
attorney, being charged with the duty of enforcing the laws,
has no right to plead that a law is unconstitutional. In support
of the argument three decisions are cited, viz.: State ex rel.
Hall, District Attorney, vs. Judge of Tenth Judicial District (33
La. Ann., 1222); State ex rel. Nicholls, Governor vs.
Shakespeare, Mayor of New Orleans (41 Ann., 156; 6 So.,
592); and State ex rel., Banking Co., etc. vs. Heard, Auditor
(47 La. Ann., 1679; 18 So., 746; 47 L. R. A., 512). These
decisions do not forbid a district attorney to plead that a
statute is unconstitutional if he finds if in conflict with one
which it is his duty to enforce. In State ex rel. Hall, District
Attorney, vs. Judge, etc., the ruling was the judge should not,
merely because he believed a certain statute to be
unconstitutional forbid the district attorney to file a bill of
information charging a person with a violation of the statute. In
other words, a judge should not judicially declare a statute
unconstitutional until the question of constitutionality is
tendered for decision, and unless it must be decided in order
to determine the right of a party litigant. State ex rel. Nicholls,
Governor, etc., is authority for the proposition merely that an
officer on whom a statute imposes the duty of enforcing its
provisions cannot avoid the duty upon the ground that he
considers the statute unconstitutional, and hence in enforcing
the statute he is immune from responsibility if the statute be
unconstitutional. State ex rel. Banking Co., etc., is authority
for the proposition merely that executive officers, e.g., the
state auditor and state treasurer, should not decline to
perform ministerial duties imposed upon them by a statute, on
the ground that they believe the statute is unconstitutional.
It is the duty of a district attorney to enforce the criminal laws
of the state, and, above all, to support the Constitution of the
state. If, in the performance of his duty he finds two statutes in
conflict with each other, or one which repeals another, and if,
in his judgment, one of the two statutes is unconstitutional, it
is his duty to enforce the other; and, in order to do so, he is
compelled to submit to the court, by way of a plea, that one of
the statutes is unconstitutional. If it were not so, the power of
the Legislature would be free from constitutional limitations in
the enactment of criminal laws.
The respondents do not seem to doubt seriously the correctness of the
general proposition that the state may impugn the validity of its laws.
They have not cited any authority running clearly in the opposite
direction. In fact, they appear to have proceeded on the assumption
that the rule as stated is sound but that it has no application in the
present case, nor may it be invoked by the City Fiscal in behalf of the
People of the Philippines, one of the petitioners herein, the principal
reasons being that the validity before this court, that the City Fiscal is
estopped from attacking the validity of the Act and, not authorized
challenge the validity of the Act in its application outside said city.
(Additional memorandum of respondents, October 23, 1937, pp. 8,. 10,
17 and 23.)
The mere fact that the Probation Act has been repeatedly relied upon
the past and all that time has not been attacked as unconstitutional by
the Fiscal of Manila but, on the contrary, has been impliedly regarded
by him as constitutional, is no reason for considering the People of the
Philippines estopped from nor assailing its validity. For courts will pass
upon a constitutional questions only when presented before it in bona
fide cases for determination, and the fact that the question has not
been raised before is not a valid reason for refusing to allow it to be
raised later. The fiscal and all others are justified in relying upon the
statute and treating it as valid until it is held void by the courts in proper
cases.
It remains to consider whether the determination of the constitutionality
of Act No. 4221 is necessary to the resolution of the instant case. For, ".
. . while the court will meet the question with firmness, where its
decision is indispensable, it is the part of wisdom, and just respect for
the legislature, renders it proper, to waive it, if the case in which it
arises, can be decided on other points." (Ex parte Randolph [1833], 20
F. Cas. No. 11, 558; 2 Brock., 447. Vide, also Hoover vs. wood [1857],
9 Ind., 286, 287.) It has been held that the determination of a
constitutional question is necessary whenever it is essential to the
decision of the case (12 C. J., p. 782, citing Long Sault Dev. Co. vs.
Kennedy [1913], 158 App. Div., 398; 143 N. Y. Supp., 454 [aff. 212
N.Y., 1: 105 N. E., 849; Ann. Cas. 1915D, 56; and app dism 242 U.S.,
272]; Hesse vs. Ledesma, 7 Porto Rico Fed., 520; Cowan vs.
Doddridge, 22 Gratt [63 Va.], 458; Union Line Co., vs. Wisconsin R.
Commn., 146 Wis., 523; 129 N. W., 605), as where the right of a party
is founded solely on a statute the validity of which is attacked. (12 C.J.,
p. 782, citing Central Glass Co. vs. Niagrara F. Ins. Co., 131 La., 513;
59 S., 972; Cheney vs. Beverly, 188 Mass., 81; 74 N.E., 306). There is
no doubt that the respondent Cu Unjieng draws his privilege to
probation solely from Act No. 4221 now being assailed.
Apart from the foregoing considerations, that court will also take
cognizance of the fact that the Probation Act is a new addition to our
statute books and its validity has never before been passed upon by
the courts; that may persons accused and convicted of crime in the City
of Manila have applied for probation; that some of them are already on
probation; that more people will likely take advantage of the Probation
Act in the future; and that the respondent Mariano Cu Unjieng has been
at large for a period of about four years since his first conviction. All
wait the decision of this court on the constitutional question.
Considering, therefore, the importance which the instant case has
assumed and to prevent multiplicity of suits, strong reasons of public
policy demand that the constitutionality of Act No. 4221 be now
resolved. (Yu Cong Eng vs. Trinidad [1925], 47 Phil., 385; [1926], 271
U.S., 500; 70 Law. ed., 1059. See 6 R.C.L., pp. 77, 78; People vs.
Kennedy [1913], 207 N.Y., 533; 101 N.E., 442, 444; Ann. Cas. 1914C,
616; Borginis vs. Falk Co. [1911], 147 Wis., 327; 133 N.W., 209, 211;
37 L.R.A. [N.S.] 489; Dimayuga and Fajardo vs. Fernandez [1922], 43
Phil., 304.) In Yu Cong Eng vs. Trinidad, supra, an analogous situation
confronted us. We said: "Inasmuch as the property and personal rights
of nearly twelve thousand merchants are affected by these
proceedings, and inasmuch as Act No. 2972 is a new law not yet
interpreted by the courts, in the interest of the public welfare and for the
advancement of public policy, we have determined to overrule the
defense of want of jurisdiction in order that we may decide the main
issue. We have here an extraordinary situation which calls for a
relaxation of the general rule." Our ruling on this point was sustained by
the Supreme Court of the United States. A more binding authority in
support of the view we have taken can not be found.
We have reached the conclusion that the question of the
constitutionality of Act No. 4221 has been properly raised. Now for the
main inquiry: Is the Act unconstitutional?
Under a doctrine peculiarly American, it is the office and duty of the
judiciary to enforce the Constitution. This court, by clear implication
from the provisions of section 2, subsection 1, and section 10, of Article
VIII of the Constitution, may declare an act of the national legislature
invalid because in conflict with the fundamental lay. It will not shirk from
its sworn duty to enforce the Constitution. And, in clear cases, it will not
hesitate to give effect to the supreme law by setting aside a statute in
conflict therewith. This is of the essence of judicial duty.
This court is not unmindful of the fundamental criteria in cases of this
nature that all reasonable doubts should be resolved in favor of the
constitutionality of a statute. An act of the legislature approved by the
executive, is presumed to be within constitutional limitations. The
responsibility of upholding the Constitution rests not on the courts alone
but on the legislature as well. "The question of the validity of every
statute is first determined by the legislative department of the
government itself." (U.S. vs. Ten Yu [1912], 24 Phil., 1, 10; Case vs.
Board of Health and Heiser [1913], 24 Phil., 250, 276; U.S. vs. Joson
[1913], 26 Phil., 1.) And a statute finally comes before the courts
sustained by the sanction of the executive. The members of the
Legislature and the Chief Executive have taken an oath to support the
Constitution and it must be presumed that they have been true to this
oath and that in enacting and sanctioning a particular law they did not
intend to violate the Constitution. The courts cannot but cautiously
exercise its power to overturn the solemn declarations of two of the
three grand departments of the governments. (6 R.C.L., p. 101.) Then,
there is that peculiar political philosophy which bids the judiciary to
reflect the wisdom of the people as expressed through an elective
Legislature and an elective Chief Executive. It follows, therefore, that
the courts will not set aside a law as violative of the Constitution except
in a clear case. This is a proposition too plain to require a citation of
authorities.
One of the counsel for respondents, in the course of his impassioned
argument, called attention to the fact that the President of the
Philippines had already expressed his opinion against the
constitutionality of the Probation Act, adverting that as to the Executive
the resolution of this question was a foregone conclusion. Counsel,
however, reiterated his confidence in the integrity and independence of
this court. We take notice of the fact that the President in his message
dated September 1, 1937, recommended to the National Assembly the
immediate repeal of the Probation Act (No. 4221); that this message
resulted in the approval of Bill No. 2417 of the Nationality Assembly
repealing the probation Act, subject to certain conditions therein
mentioned; but that said bill was vetoed by the President on September
13, 1937, much against his wish, "to have stricken out from the statute
books of the Commonwealth a law . . . unfair and very likely
unconstitutional." It is sufficient to observe in this connection that, in
vetoing the bill referred to, the President exercised his constitutional
prerogative. He may express the reasons which he may deem proper
for taking such a step, but his reasons are not binding upon us in the
determination of actual controversies submitted for our determination.
Whether or not the Executive should express or in any manner
insinuate his opinion on a matter encompassed within his broad
constitutional power of veto but which happens to be at the same time
pending determination in this court is a question of propriety for him
exclusively to decide or determine. Whatever opinion is expressed by
him under these circumstances, however, cannot sway our judgment
on way or another and prevent us from taking what in our opinion is the
proper course of action to take in a given case. It if is ever necessary
for us to make any vehement affirmance during this formative period of
our political history, it is that we are independent of the Executive no
less than of the Legislative department of our government —
independent in the performance of our functions, undeterred by any
consideration, free from politics, indifferent to popularity, and unafraid of
criticism in the accomplishment of our sworn duty as we see it and as
we understand it.
The constitutionality of Act No. 4221 is challenged on three principal
grounds: (1) That said Act encroaches upon the pardoning power of the
Executive; (2) that its constitutes an undue delegation of legislative
power and (3) that it denies the equal protection of the laws.
1. Section 21 of the Act of Congress of August 29, 1916, commonly
known as the Jones Law, in force at the time of the approval of Act No.
4221, otherwise known as the Probation Act, vests in the Governor-
General of the Philippines "the exclusive power to grant pardons and
reprieves and remit fines and forfeitures". This power is now vested in
the President of the Philippines. (Art. VII, sec. 11, subsec. 6.) The
provisions of the Jones Law and the Constitution differ in some
respects. The adjective "exclusive" found in the Jones Law has been
omitted from the Constitution. Under the Jones Law, as at common law,
pardon could be granted any time after the commission of the offense,
either before or after conviction (Vide Constitution of the United States,
Art. II, sec. 2; In re Lontok [1922], 43 Phil., 293). The Governor-General
of the Philippines was thus empowered, like the President of the United
States, to pardon a person before the facts of the case were fully
brought to light. The framers of our Constitution thought this
undesirable and, following most of the state constitutions, provided that
the pardoning power can only be exercised "after conviction". So, too,
under the new Constitution, the pardoning power does not extend to
"cases of impeachment". This is also the rule generally followed in the
United States (Vide Constitution of the United States, Art. II, sec. 2).
The rule in England is different. There, a royal pardon can not be
pleaded in bar of an impeachment; "but," says Blackstone, "after the
impeachment has been solemnly heard and determined, it is not
understood that the king's royal grace is further restrained or abridged."
(Vide, Ex parte Wells [1856], 18 How., 307; 15 Law. ed., 421; Com. vs.
Lockwood [1872], 109 Mass., 323; 12 Am. Rep., 699; Sterling vs. Drake
[1876], 29 Ohio St., 457; 23 am. Rep., 762.) The reason for the
distinction is obvious. In England, Judgment on impeachment is not
confined to mere "removal from office and disqualification to hold and
enjoy any office of honor, trust, or profit under the Government" (Art. IX,
sec. 4, Constitution of the Philippines) but extends to the whole
punishment attached by law to the offense committed. The House of
Lords, on a conviction may, by its sentence, inflict capital punishment,
perpetual banishment, perpetual banishment, fine or imprisonment,
depending upon the gravity of the offense committed, together with
removal from office and incapacity to hold office. (Com. vs. Lockwood,
supra.) Our Constitution also makes specific mention of "commutation"
and of the power of the executive to impose, in the pardons he may
grant, such conditions, restrictions and limitations as he may deem
proper. Amnesty may be granted by the President under the
Constitution but only with the concurrence of the National Assembly.
We need not dwell at length on the significance of these fundamental
changes. It is sufficient for our purposes to state that the pardoning
power has remained essentially the same. The question is: Has the
pardoning power of the Chief Executive under the Jones Law been
impaired by the Probation Act?
As already stated, the Jones Law vests the pardoning power
exclusively in the Chief Executive. The exercise of the power may not,
therefore, be vested in anyone else.
". . . The benign prerogative of mercy reposed in the executive cannot
be taken away nor fettered by any legislative restrictions, nor can like
power be given by the legislature to any other officer or authority. The
coordinate departments of government have nothing to do with the
pardoning power, since no person properly belonging to one of the
departments can exercise any powers appertaining to either of the
others except in cases expressly provided for by the constitution." (20
R.C.L., pp., , and cases cited.) " . . . where the pardoning power is
conferred on the executive without express or implied limitations, the
grant is exclusive, and the legislature can neither exercise such power
itself nor delegate it elsewhere, nor interfere with or control the proper
exercise thereof, . . ." (12 C.J., pp. 838, 839, and cases cited.) If Act
No. 4221, then, confers any pardoning power upon the courts it is for
that reason unconstitutional and void. But does it?
In the famous Killitts decision involving an embezzlement case, the
Supreme Court of the United States ruled in 1916 that an order
indefinitely suspending sentenced was void. (Ex parte United States
[1916], 242 U.S., 27; 61 Law. ed., 129; L.R.A. 1917E, 1178; 37 Sup. Ct.
Rep., 72; Ann. Cas. 1917B, 355.) Chief Justice White, after an
exhaustive review of the authorities, expressed the opinion of the court
that under the common law the power of the court was limited to
temporary suspension and that the right to suspend sentenced
absolutely and permanently was vested in the executive branch of the
government and not in the judiciary. But, the right of Congress to
establish probation by statute was conceded. Said the court through its
Chief Justice: ". . . and so far as the future is concerned, that is, the
causing of the imposition of penalties as fixed to be subject, by
probation legislation or such other means as the legislative mind may
devise, to such judicial discretion as may be adequate to enable courts
to meet by the exercise of an enlarged but wise discretion the infinite
variations which may be presented to them for judgment, recourse must
be had Congress whose legislative power on the subject is in the very
nature of things adequately complete." (Quoted in Riggs vs. United
States [1926], 14 F. [2d], 5, 6.) This decision led the National Probation
Association and others to agitate for the enactment by Congress of a
federal probation law. Such action was finally taken on March 4, 1925
(chap. 521, 43 Stat. L. 159, U.S.C. title 18, sec. 724). This was followed
by an appropriation to defray the salaries and expenses of a certain
number of probation officers chosen by civil service. (Johnson,
Probation for Juveniles and Adults, p. 14.)
In United States vs. Murray ([1925], 275 U.S., 347; 48 Sup. Ct. Rep.,
146; 72 Law. ed., 309), the Supreme Court of the United States,
through Chief Justice Taft, held that when a person sentenced to
imprisonment by a district court has begun to serve his sentence, that
court has no power under the Probation Act of March 4, 1925 to grant
him probation even though the term at which sentence was imposed
had not yet expired. In this case of Murray, the constitutionality of the
probation Act was not considered but was assumed. The court traced
the history of the Act and quoted from the report of the Committee on
the Judiciary of the United States House of Representatives (Report
No. 1377, 68th Congress, 2 Session) the following statement:
Prior to the so-called Killitts case, rendered in December,
1916, the district courts exercised a form of probation either,
by suspending sentence or by placing the defendants under
state probation officers or volunteers. In this case, however
(Ex parte United States, 242 U.S., 27; 61 L. Ed., 129; L.R.A.,
1917E, 1178; 37 Sup. Ct. Rep., 72 Ann. Cas. 1917B, 355),
the Supreme Court denied the right of the district courts to
suspend sentenced. In the same opinion the court pointed out
the necessity for action by Congress if the courts were to
exercise probation powers in the future . . .
Since this decision was rendered, two attempts have been
made to enact probation legislation. In 1917, a bill was
favorably reported by the Judiciary Committee and passed the
House. In 1920, the judiciary Committee again favorably
reported a probation bill to the House, but it was never
reached for definite action.
If this bill is enacted into law, it will bring the policy of the
Federal government with reference to its treatment of those
convicted of violations of its criminal laws in harmony with that
of the states of the Union. At the present time every state has
a probation law, and in all but twelve states the law applies
both to adult and juvenile offenders. (see, also, Johnson,
Probation for Juveniles and Adults [1928], Chap. I.)
The constitutionality of the federal probation law has been sustained by
inferior federal courts. In Riggs vs. United States supra, the Circuit
Court of Appeals of the Fourth Circuit said:
Since the passage of the Probation Act of March 4, 1925, the
questions under consideration have been reviewed by the
Circuit Court of Appeals of the Ninth Circuit (7 F. [2d], 590),
and the constitutionality of the act fully sustained, and the
same held in no manner to encroach upon the pardoning
power of the President. This case will be found to contain an
able and comprehensive review of the law applicable here. It
arose under the act we have to consider, and to it and the
authorities cited therein special reference is made (Nix vs.
James, 7 F. [2d], 590, 594), as is also to a decision of the
Circuit Court of Appeals of the Seventh Circuit (Kriebel vs.
U.S., 10 F. [2d], 762), likewise construing the Probation Act.
We have seen that in 1916 the Supreme Court of the United States; in
plain and unequivocal language, pointed to Congress as possessing
the requisite power to enact probation laws, that a federal probation law
as actually enacted in 1925, and that the constitutionality of the Act has
been assumed by the Supreme Court of the United States in 1928 and
consistently sustained by the inferior federal courts in a number of
earlier cases.
We are fully convinced that the Philippine Legislature, like the Congress
of the United States, may legally enact a probation law under its broad
power to fix the punishment of any and all penal offenses. This
conclusion is supported by other authorities. In Ex parte Bates ([1915],
20 N. M., 542; L.R.A. 1916A, 1285; 151 Pac., 698, the court said: "It is
clearly within the province of the Legislature to denominate and define
all classes of crime, and to prescribe for each a minimum and
maximum punishment." And in State vs. Abbott ([1910], 87 S.C., 466;
33 L.R.A. [N. S.], 112; 70 S. E., 6; Ann. Cas. 1912B, 1189), the court
said: "The legislative power to set punishment for crime is very broad,
and in the exercise of this power the general assembly may confer on
trial judges, if it sees fit, the largest discretion as to the sentence to be
imposed, as to the beginning and end of the punishment and whether it
should be certain or indeterminate or conditional." (Quoted in State vs.
Teal [1918], 108 S. C., 455; 95 S. E., 69.) Indeed, the Philippine
Legislature has defined all crimes and fixed the penalties for their
violation. Invariably, the legislature has demonstrated the desire to vest
in the courts — particularly the trial courts — large discretion in
imposing the penalties which the law prescribes in particular cases. It is
believed that justice can best be served by vesting this power in the
courts, they being in a position to best determine the penalties which an
individual convict, peculiarly circumstanced, should suffer. Thus, while
courts are not allowed to refrain from imposing a sentence merely
because, taking into consideration the degree of malice and the injury
caused by the offense, the penalty provided by law is clearly excessive,
the courts being allowed in such case to submit to the Chief Executive,
through the Department of Justice, such statement as it may deem
proper (see art. 5, Revised Penal Code), in cases where both mitigating
and aggravating circumstances are attendant in the commission of a
crime and the law provides for a penalty composed of two indivisible
penalties, the courts may allow such circumstances to offset one
another in consideration of their number and importance, and to apply
the penalty according to the result of such compensation. (Art. 63, rule
4, Revised Penal Code; U.S. vs. Reguera and Asuategui [1921], 41
Phil., 506.) Again, article 64, paragraph 7, of the Revised Penal Code
empowers the courts to determine, within the limits of each periods, in
case the penalty prescribed by law contains three periods, the extent of
the evil produced by the crime. In the imposition of fines, the courts are
allowed to fix any amount within the limits established by law,
considering not only the mitigating and aggravating circumstances, but
more particularly the wealth or means of the culprit. (Art. 66, Revised
Penal Code.) Article 68, paragraph 1, of the same Code provides that
"a discretionary penalty shall be imposed" upon a person under fifteen
but over nine years of age, who has not acted without discernment, but
always lower by two degrees at least than that prescribed by law for the
crime which he has committed. Article 69 of the same Code provides
that in case of "incomplete self-defense", i.e., when the crime
committed is not wholly excusable by reason of the lack of some of the
conditions required to justify the same or to exempt from criminal
liability in the several cases mentioned in article 11 and 12 of the Code,
"the courts shall impose the penalty in the period which may be
deemed proper, in view of the number and nature of the conditions of
exemption present or lacking." And, in case the commission of what are
known as "impossible" crimes, "the court, having in mind the social
danger and the degree of criminality shown by the offender," shall
impose upon him either arresto mayor or a fine ranging from 200 to 500
pesos. (Art. 59, Revised Penal Code.)
Under our Revised Penal Code, also, one-half of the period of
preventive imprisonment is deducted form the entire term of
imprisonment, except in certain cases expressly mentioned (art. 29);
the death penalty is not imposed when the guilty person is more than
seventy years of age, or where upon appeal or revision of the case by
the Supreme Court, all the members thereof are not unanimous in their
voting as to the propriety of the imposition of the death penalty (art. 47,
see also, sec. 133, Revised Administrative Code, as amended by
Commonwealth Act No. 3); the death sentence is not to be inflicted
upon a woman within the three years next following the date of the
sentence or while she is pregnant, or upon any person over seventy
years of age (art. 83); and when a convict shall become insane or an
imbecile after final sentence has been pronounced, or while he is
serving his sentenced, the execution of said sentence shall be
suspended with regard to the personal penalty during the period of
such insanity or imbecility (art. 79).
But the desire of the legislature to relax what might result in the undue
harshness of the penal laws is more clearly demonstrated in various
other enactments, including the probation Act. There is the
Indeterminate Sentence Law enacted in 1933 as Act No. 4103 and
subsequently amended by Act No. 4225, establishing a system of
parole (secs. 5 to 100 and granting the courts large discretion in
imposing the penalties of the law. Section 1 of the law as amended
provides; "hereafter, in imposing a prison sentence for an offenses
punished by the Revised Penal Code, or its amendments, the court
shall sentence the accused to an indeterminate sentence the maximum
term of which shall be that which, in view of the attending
circumstances, could be properly imposed under the rules of the said
Code, and to a minimum which shall be within the range of the penalty
next lower to that prescribed by the Code for the offense; and if the
offense is punished by any other law, the court shall sentence the
accused to an indeterminate sentence, the maximum term of which
shall not exceed the maximum fixed by said law and the minimum shall
not be less than the minimum term prescribed by the same." Certain
classes of convicts are, by section 2 of the law, excluded from the
operation thereof. The Legislature has also enacted the Juvenile
Delinquency Law (Act No. 3203) which was subsequently amended by
Act No. 3559. Section 7 of the original Act and section 1 of the
amendatory Act have become article 80 of the Revised Penal Code,
amended by Act No. 4117 of the Philippine Legislature and recently
reamended by Commonwealth Act No. 99 of the National Assembly. In
this Act is again manifested the intention of the legislature to
"humanize" the penal laws. It allows, in effect, the modification in
particular cases of the penalties prescribed by law by permitting the
suspension of the execution of the judgment in the discretion of the trial
court, after due hearing and after investigation of the particular
circumstances of the offenses, the criminal record, if any, of the convict,
and his social history. The Legislature has in reality decreed that in
certain cases no punishment at all shall be suffered by the convict as
long as the conditions of probation are faithfully observed. It this be so,
then, it cannot be said that the Probation Act comes in conflict with the
power of the Chief Executive to grant pardons and reprieves, because,
to use the language of the Supreme Court of New Mexico, "the element
of punishment or the penalty for the commission of a wrong, while to be
declared by the courts as a judicial function under and within the limits
of law as announced by legislative acts, concerns solely the procedure
and conduct of criminal causes, with which the executive can have
nothing to do." (Ex parte Bates, supra.) In Williams vs. State ([1926],
162 Ga., 327; 133 S.E., 843), the court upheld the constitutionality of
the Georgia probation statute against the contention that it attempted to
delegate to the courts the pardoning power lodged by the constitution in
the governor alone is vested with the power to pardon after final
sentence has been imposed by the courts, the power of the courts to
imposed any penalty which may be from time to time prescribed by law
and in such manner as may be defined cannot be questioned."
We realize, of course, the conflict which the American cases disclose.
Some cases hold it unlawful for the legislature to vest in the courts the
power to suspend the operation of a sentenced, by probation or
otherwise, as to do so would encroach upon the pardoning power of the
executive. (In re Webb [1895], 89 Wis., 354; 27 L.R.A., 356; 46 Am. St.
Rep., 846; 62 N.W., 177; 9 Am. Crim., Rep., 702; State ex rel.
Summerfield vs. Moran [1919], 43 Nev., 150; 182 Pac., 927; Ex parte
Clendenning [1908], 22 Okla., 108; 1 Okla. Crim. Rep., 227; 19 L.R.A.
[N.S.], 1041; 132 Am. St. Rep., 628; 97 Pac., 650; People vs. Barrett
[1903], 202 Ill, 287; 67 N.E., 23; 63 L.R.A., 82; 95 Am. St. Rep., 230;
Snodgrass vs. State [1912], 67 Tex. Crim. Rep., 615; 41 L. R. A. [N.
S.], 1144; 150 S. W., 162; Ex parte Shelor [1910], 33 Nev., 361;111
Pac., 291; Neal vs. State [1898], 104 Ga., 509; 42 L. R. A., 190; 69 Am.
St. Rep., 175; 30 S. E. 858; State ex rel. Payne vs. Anderson [1921], 43
S. D., 630; 181 N. W., 839; People vs. Brown, 54 Mich., 15; 19 N. W.,
571; States vs. Dalton [1903], 109 Tenn., 544; 72 S. W., 456.)
Other cases, however, hold contra. (Nix vs. James [1925; C. C. A., 9th],
7 F. [2d], 590; Archer vs. Snook [1926; D. C.], 10 F. [2d], 567; Riggs.
vs. United States [1926; C. C. A. 4th], 14]) [2d], 5; Murphy vs. States
[1926], 171 Ark., 620; 286 S. W., 871; 48 A. L. R., 1189; Re Giannini
[1912], 18 Cal. App., 166; 122 Pac., 831; Re Nachnaber [1928], 89 Cal.
App., 530; 265 Pac., 392; Ex parte De Voe [1931], 114 Cal. App., 730;
300 Pac., 874; People vs. Patrick [1897], 118 Cal., 332; 50 Pac., 425;
Martin vs. People [1917], 69 Colo., 60; 168 Pac., 1171; Belden vs.
Hugo [1914], 88 Conn., 50; 91 A., 369, 370, 371; Williams vs. State
[1926], 162 Ga., 327; 133 S. E., 843; People vs. Heise [1913], 257 Ill.,
443; 100 N. E., 1000; Parker vs. State [1893], 135 Ind., 534; 35 N. E.,
179; 23 L. R. A., 859; St. Hillarie, Petitioner [1906], 101 Me., 522; 64
Atl., 882; People vs. Stickle [1909], 156 Mich., 557; 121 N. W., 497;
State vs. Fjolander [1914], 125 Minn., 529; State ex rel. Bottomnly vs.
District Court [1925], 73 Mont., 541; 237 Pac., 525; State vs. Everitt
[1913], 164 N. C., 399; 79 S. E., 274; 47 L. R. A. [N. S.], 848; State ex
rel. Buckley vs. Drew [1909], 75 N. H., 402; 74 Atl., 875; State vs.
Osborne [1911], 79 N. J. Eq., 430; 82 Atl. 424; Ex parte Bates [1915],
20 N. M., 542; L. R. A., 1916 A. 1285; 151 Pac., 698; People vs. ex rel.
Forsyth vs. Court of Session [1894], 141 N. Y., 288; 23 L. R. A., 856; 36
N. E., 386; 15 Am. Crim. Rep., 675; People ex rel. Sullivan vs. Flynn
[1907], 55 Misc., 639; 106 N. Y. Supp., 928; People vs. Goodrich
[1914], 149 N. Y. Supp., 406; Moore vs. Thorn [1935], 245 App. Div.,
180; 281 N. Y. Supp., 49; Re Hart [1914], 29 N. D., 38; L. R. A., 1915C,
1169; 149 N. W., 568; Ex parte Eaton [1925], 29 Okla., Crim. Rep.,
275; 233 P., 781; State vs. Teal [1918], 108 S. C., 455; 95 S. E., 69;
State vs. Abbot [1910], 87 S. C., 466; 33 L.R.A., [N. S.], 112; 70 S. E.,
6; Ann. Cas., 1912B, 1189; Fults vs. States [1854],34 Tenn., 232;
Woods vs. State [1814], 130 Tenn., 100; 169 S. W., 558; Baker vs.
State [1814], 130 Tenn., 100; 169 S. W., 558; Baker vs. State [1913],70
Tex., Crim. Rep., 618; 158 S. W., 998; Cook vs. State [1914], 73 Tex.
Crim. Rep., 548; 165 S. W., 573; King vs. State [1914], 72 Tex. Crim.
Rep., 394; 162 S. W., 890; Clare vs. State [1932], 122 Tex. Crim. Rep.,
394; 162 S. W., 890; Clare vs. State [1932], 122 Tex. Crim. Rep., 211;
54 S. W. [2d], 127; Re Hall [1927], 100 Vt., 197; 136 A., 24; Richardson
vs. Com. [1921], 131 Va., 802; 109 S.E., 460; State vs. Mallahan
[1911], 65 Wash., 287; 118 Pac., 42; State ex rel. Tingstand vs.
Starwich [1922], 119 Wash., 561; 206 Pac., 29; 26 A. L. R., 393; 396.)
We elect to follow this long catena of authorities holding that the courts
may be legally authorized by the legislature to suspend sentence by the
establishment of a system of probation however characterized. State
ex rel. Tingstand vs. Starwich ([1922], 119 Wash., 561; 206 Pac., 29;
26 A. L. R., 393), deserved particular mention. In that case, a statute
enacted in 1921 which provided for the suspension of the execution of
a sentence until otherwise ordered by the court, and required that the
convicted person be placed under the charge of a parole or peace
officer during the term of such suspension, on such terms as the court
may determine, was held constitutional and as not giving the court a
power in violation of the constitutional provision vesting the pardoning
power in the chief executive of the state. (Vide, also, Re Giannini
[1912], 18 Cal App., 166; 122 Pac., 831.)
Probation and pardon are not coterminous; nor are they the same.
They are actually district and different from each other, both in origin
and in nature. In People ex rel. Forsyth vs. Court of Sessions ([1894],
141 N. Y., 288, 294; 36 N. E., 386, 388; 23 L. R. A., 856; 15 Am. Crim.
Rep., 675), the Court of Appeals of New York said:
. . . The power to suspend sentence and the power to grant
reprieves and pardons, as understood when the constitution
was adopted, are totally distinct and different in their nature.
The former was always a part of the judicial power; the latter
was always a part of the executive power. The suspension of
the sentence simply postpones the judgment of the court
temporarily or indefinitely, but the conviction and liability
following it, and the civil disabilities, remain and become
operative when judgment is rendered. A pardon reaches both
the punishment prescribed for the offense and the guilt of the
offender. It releases the punishment, and blots out of
existence the guilt, so that in the eye of the law, the offender
is as innocent as if he had never committed the offense. It
removes the penalties and disabilities, and restores him to all
his civil rights. It makes him, as it were, a new man, and gives
him a new credit and capacity. (Ex parte Garland, 71 U. S., 4
Wall., 333; 18 Law. ed., 366; U. S. vs. Klein, 80 U. S., 13
Wall., 128; 20 Law. ed., 519; Knote vs. U. S., 95 U. S., 149;
24 Law. ed., 442.)
The framers of the federal and the state constitutions were
perfectly familiar with the principles governing the power to
grant pardons, and it was conferred by these instruments
upon the executive with full knowledge of the law upon the
subject, and the words of the constitution were used to
express the authority formerly exercised by the English crown,
or by its representatives in the colonies. (Ex parte Wells, 59
U. S., 18 How., 307; 15 Law. ed., 421.) As this power was
understood, it did not comprehend any part of the judicial
functions to suspend sentence, and it was never intended that
the authority to grant reprieves and pardons should abrogate,
or in any degree restrict, the exercise of that power in regard
to its own judgments, that criminal courts has so long
maintained. The two powers, so distinct and different in their
nature and character, were still left separate and distinct, the
one to be exercised by the executive, and the other by the
judicial department. We therefore conclude that a statute
which, in terms, authorizes courts of criminal jurisdiction to
suspend sentence in certain cases after conviction, — a
power inherent in such courts at common law, which was
understood when the constitution was adopted to be an
ordinary judicial function, and which, ever since its adoption,
has been exercised of legislative power under the
constitution. It does not encroach, in any just sense, upon the
powers of the executive, as they have been understood and
practiced from the earliest times. (Quoted with approval in
Directors of Prisons vs. Judge of First Instance of Cavite
[1915], 29 Phil., 265, Carson, J., concurring, at pp. 294, 295.)
In probation, the probationer is in no true sense, as in pardon, a free
man. He is not finally and completely exonerated. He is not exempt
from the entire punishment which the law inflicts. Under the Probation
Act, the probationer's case is not terminated by the mere fact that he is
placed on probation. Section 4 of the Act provides that the probation
may be definitely terminated and the probationer finally discharged from
supervision only after the period of probation shall have been
terminated and the probation officer shall have submitted a report, and
the court shall have found that the probationer has complied with the
conditions of probation. The probationer, then, during the period of
probation, remains in legal custody — subject to the control of the
probation officer and of the court; and, he may be rearrested upon the
non-fulfillment of the conditions of probation and, when rearrested, may
be committed to prison to serve the sentence originally imposed upon
him. (Secs. 2, 3, 5 and 6, Act No. 4221.)
The probation described in the act is not pardon. It is not
complete liberty, and may be far from it. It is really a new
mode of punishment, to be applied by the judge in a proper
case, in substitution of the imprisonment and find prescribed
by the criminal laws. For this reason its application is as
purely a judicial act as any other sentence carrying out the
law deemed applicable to the offense. The executive act of
pardon, on the contrary, is against the criminal law, which
binds and directs the judges, or rather is outside of and above
it. There is thus no conflict with the pardoning power, and no
possible unconstitutionality of the Probation Act for this cause.
(Archer vs. Snook [1926], 10 F. [2d], 567, 569.)
Probation should also be distinguished from reprieve and from
commutation of the sentence. Snodgrass vs. State ([1912], 67 Tex.
Crim. Rep., 615;41 L. R. A. [N. S.], 1144; 150 S. W., 162), is relied
upon most strongly by the petitioners as authority in support of their
contention that the power to grant pardons and reprieves, having been
vested exclusively upon the Chief Executive by the Jones Law, may not
be conferred by the legislature upon the courts by means of probation
law authorizing the indefinite judicial suspension of sentence. We have
examined that case and found that although the Court of Criminal
Appeals of Texas held that the probation statute of the state in terms
conferred on the district courts the power to grant pardons to persons
convicted of crime, it also distinguished between suspensions sentence
on the one hand, and reprieve and commutation of sentence on the
other. Said the court, through Harper, J.:
That the power to suspend the sentence does not conflict with
the power of the Governor to grant reprieves is settled by the
decisions of the various courts; it being held that the
distinction between a "reprieve" and a suspension of sentence
is that a reprieve postpones the execution of the sentence to
a day certain, whereas a suspension is for an indefinite time.
(Carnal vs. People, 1 Parker, Cr. R., 262; In re Buchanan, 146
N. Y., 264; 40 N. E., 883), and cases cited in 7 Words &
 Phrases, pp. 6115, 6116. This law cannot be hold in conflict
with the power confiding in the Governor to grant
commutations of punishment, for a commutations is not but to
change the punishment assessed to a less punishment.
In State ex rel. Bottomnly vs. District Court ([1925], 73 Mont., 541; 237
Pac., 525), the Supreme Court of Montana had under consideration the
validity of the adult probation law of the state enacted in 1913, now
found in sections 12078-12086, Revised Codes of 1921. The court held
the law valid as not impinging upon the pardoning power of the
executive. In a unanimous decision penned by Justice Holloway, the
court said:
. . . . the term "pardon", "commutation", and "respite" each
had a well understood meaning at the time our Constitution
was adopted, and no one of them was intended to
comprehend the suspension of the execution of the judgment
as that phrase is employed in sections 12078-12086. A
"pardon" is an act of grace, proceeding from the power
intrusted with the execution of the laws which exempts the
individual on whom it is bestowed from the punishment the
law inflicts for a crime he has committed (United States vs.
Wilson, 7 Pet., 150; 8 Law. ed., 640); It is a remission of guilt
(State vs. Lewis, 111 La., 693; 35 So., 816), a forgiveness of
the offense (Cook vs. Middlesex County, 26 N. J. Law, 326;
Ex parte Powell, 73 Ala., 517; 49 Am. Rep., 71).
"Commutation" is a remission of a part of the punishment; a
substitution of a less penalty for the one originally imposed
(Lee vs. Murphy, 22 Grat. [Va.] 789; 12 Am. Rep., 563; Rich
vs. Chamberlain, 107 Mich., 381; 65 N. W., 235). A "reprieve"
or "respite" is the withholding of the sentence for an interval of
time (4 Blackstone's Commentaries, 394), a postponement of
execution (Carnal vs. People, 1 Parker, Cr. R. [N. Y.], 272), a
temporary suspension of execution (Butler vs. State, 97 Ind.,
373).
Few adjudicated cases are to be found in which the validity of
a statute similar to our section 12078 has been determined;
but the same objections have been urged against parole
statutes which vest the power to parole in persons other than
those to whom the power of pardon is granted, and these
statutes have been upheld quite uniformly, as a reference to
the numerous cases cited in the notes to Woods vs. State
(130 Tenn., 100; 169 S. W.,558, reported in L. R. A., 1915F,
531), will disclose. (See, also, 20 R. C. L., 524.)
We conclude that the Probation Act does not conflict with the pardoning
power of the Executive. The pardoning power, in respect to those
serving their probationary sentences, remains as full and complete as if
the Probation Law had never been enacted. The President may yet
pardon the probationer and thus place it beyond the power of the court
to order his rearrest and imprisonment. (Riggs vs. United States [1926],
14 F. [2d], 5, 7.)
2. But while the Probation Law does not encroach upon the pardoning
power of the executive and is not for that reason void, does section 11
thereof constitute, as contended, an undue delegation of legislative
power?
Under the constitutional system, the powers of government are
distributed among three coordinate and substantially independent
organs: the legislative, the executive and the judicial. Each of these
departments of the government derives its authority from the
Constitution which, in turn, is the highest expression of popular will.
Each has exclusive cognizance of the matters within its jurisdiction, and
is supreme within its own sphere.
The power to make laws — the legislative power — is vested in a
bicameral Legislature by the Jones Law (sec. 12) and in a unicamiral
National Assembly by the Constitution (Act. VI, sec. 1, Constitution of
the Philippines). The Philippine Legislature or the National Assembly
may not escape its duties and responsibilities by delegating that power
to any other body or authority. Any attempt to abdicate the power is
unconstitutional and void, on the principle that potestas delegata non
delegare potest. This principle is said to have originated with the
glossators, was introduced into English law through a misreading of
Bracton, there developed as a principle of agency, was established by
Lord Coke in the English public law in decisions forbidding the
delegation of judicial power, and found its way into America as an
enlightened principle of free government. It has since become an
accepted corollary of the principle of separation of powers. (5 Encyc. of
the Social Sciences, p. 66.) The classic statement of the rule is that of
Locke, namely: "The legislative neither must nor can transfer the power
of making laws to anybody else, or place it anywhere but where the
people have." (Locke on Civil Government, sec. 142.) Judge Cooley
enunciates the doctrine in the following oft-quoted language: "One of
the settled maxims in constitutional law is, that the power conferred
upon the legislature to make laws cannot be delegated by that
department to any other body or authority. Where the sovereign power
of the state has located the authority, there it must remain; and by the
constitutional agency alone the laws must be made until the
Constitution itself is charged. The power to whose judgment, wisdom,
and patriotism this high prerogative has been intrusted cannot relieve
itself of the responsibilities by choosing other agencies upon which the
power shall be devolved, nor can it substitute the judgment, wisdom,
and patriotism of any other body for those to which alone the people
have seen fit to confide this sovereign trust." (Cooley on Constitutional
Limitations, 8th ed., Vol. I, p. 224. Quoted with approval in U. S. vs.
Barrias [1908], 11 Phil., 327.) This court posits the doctrine "on the
ethical principle that such a delegated power constitutes not only a right
but a duty to be performed by the delegate by the instrumentality of his
own judgment acting immediately upon the matter of legislation and not
through the intervening mind of another. (U. S. vs. Barrias, supra, at p.
330.)
The rule, however, which forbids the delegation of legislative power is
not absolute and inflexible. It admits of exceptions. An exceptions
sanctioned by immemorial practice permits the central legislative body
to delegate legislative powers to local authorities. (Rubi vs. Provincial
Board of Mindoro [1919], 39 Phil., 660; U. S. vs. Salaveria [1918], 39
Phil., 102; Stoutenburgh vs. Hennick [1889], 129 U. S., 141; 32 Law.
ed., 637; 9 Sup. Ct. Rep., 256; State vs. Noyes [1855], 30 N. H., 279.)
"It is a cardinal principle of our system of government, that local affairs
shall be managed by local authorities, and general affairs by the central
authorities; and hence while the rule is also fundamental that the power
to make laws cannot be delegated, the creation of the municipalities
exercising local self government has never been held to trench upon
that rule. Such legislation is not regarded as a transfer of general
legislative power, but rather as the grant of the authority to prescribed
local regulations, according to immemorial practice, subject of course to
the interposition of the superior in cases of necessity." (Stoutenburgh
vs. Hennick, supra.) On quite the same principle, Congress is powered
to delegate legislative power to such agencies in the territories of the
United States as it may select. A territory stands in the same relation to
Congress as a municipality or city to the state government. (United
States vs. Heinszen [1907], 206 U. S., 370; 27 Sup. Ct. Rep., 742; 51
L. ed., 1098; 11 Ann. Cas., 688; Dorr vs. United States [1904], 195
U.S., 138; 24 Sup. Ct. Rep., 808; 49 Law. ed., 128; 1 Ann. Cas., 697.)
Courts have also sustained the delegation of legislative power to the
people at large. Some authorities maintain that this may not be done
(12 C. J., pp. 841, 842; 6 R. C. L., p. 164, citing People vs. Kennedy
[1913], 207 N. Y., 533; 101 N. E., 442; Ann. Cas., 1914C, 616).
However, the question of whether or not a state has ceased to be
republican in form because of its adoption of the initiative and
referendum has been held not to be a judicial but a political question
(Pacific States Tel. & Tel. Co. vs. Oregon [1912], 223 U. S., 118; 56
Law. ed., 377; 32 Sup. Cet. Rep., 224), and as the constitutionality of
such laws has been looked upon with favor by certain progressive
courts, the sting of the decisions of the more conservative courts has
been pretty well drawn. (Opinions of the Justices [1894], 160 Mass.,
586; 36 N. E., 488; 23 L. R. A., 113; Kiernan vs. Portland [1910], 57
Ore., 454; 111 Pac., 379; 1132 Pac., 402; 37 L. R. A. [N. S.], 332;
Pacific States Tel. & Tel. Co. vs. Oregon, supra.) Doubtless, also,
legislative power may be delegated by the Constitution itself. Section
14, paragraph 2, of article VI of the Constitution of the Philippines
provides that "The National Assembly may by law authorize the
President, subject to such limitations and restrictions as it may impose,
to fix within specified limits, tariff rates, import or export quotas, and
tonnage and wharfage dues." And section 16 of the same article of the
Constitution provides that "In times of war or other national emergency,
the National Assembly may by law authorize the President, for a limited
period and subject to such restrictions as it may prescribed, to
promulgate rules and regulations to carry out a declared national
policy." It is beyond the scope of this decision to determine whether or
not, in the absence of the foregoing constitutional provisions, the
President could be authorized to exercise the powers thereby vested in
him. Upon the other hand, whatever doubt may have existed has been
removed by the Constitution itself.
The case before us does not fall under any of the exceptions
hereinabove mentioned.
The challenged section of Act No. 4221 in section 11 which reads as
follows:
This Act shall apply only in those provinces in which the
respective provincial boards have provided for the salary of a
probation officer at rates not lower than those now provided
for provincial fiscals. Said probation officer shall be appointed
by the Secretary of Justice and shall be subject to the
direction of the Probation Office. (Emphasis ours.)
In testing whether a statute constitute an undue delegation of legislative
power or not, it is usual to inquire whether the statute was complete in
all its terms and provisions when it left the hands of the legislature so
that nothing was left to the judgment of any other appointee or delegate
of the legislature. (6 R. C. L., p. 165.) In the United States vs. Ang Tang
Ho ([1922], 43 Phil., 1), this court adhered to the foregoing rule when it
held an act of the legislature void in so far as it undertook to authorize
the Governor-General, in his discretion, to issue a proclamation fixing
the price of rice and to make the sale of it in violation of the
proclamation a crime. (See and cf. Compañia General de Tabacos vs.
Board of Public Utility Commissioners [1916], 34 Phil., 136.) The
general rule, however, is limited by another rule that to a certain extent
matters of detail may be left to be filled in by rules and regulations to be
adopted or promulgated by executive officers and administrative
boards. (6 R. C. L., pp. 177-179.)
For the purpose of Probation Act, the provincial boards may be
regarded as administrative bodies endowed with power to determine
when the Act should take effect in their respective provinces. They are
the agents or delegates of the legislature in this respect. The rules
governing delegation of legislative power to administrative and
executive officers are applicable or are at least indicative of the rule
which should be here adopted. An examination of a variety of cases on
delegation of power to administrative bodies will show that the ratio
decidendi is at variance but, it can be broadly asserted that the
rationale revolves around the presence or absence of a standard or rule
of action — or the sufficiency thereof — in the statute, to aid the
delegate in exercising the granted discretion. In some cases, it is held
that the standard is sufficient; in others that is insufficient; and in still
others that it is entirely lacking. As a rule, an act of the legislature is
incomplete and hence invalid if it does not lay down any rule or definite
standard by which the administrative officer or board may be guided in
the exercise of the discretionary powers delegated to it. (See Schecter
vs. United States [1925], 295 U. S., 495; 79 L. ed., 1570; 55 Sup. Ct.
Rep., 837; 97 A.L.R., 947; People ex rel. Rice vs. Wilson Oil Co. [1936],
364 Ill., 406; 4 N. E. [2d], 847; 107 A.L.R., 1500 and cases cited. See
also R. C. L., title "Constitutional Law", sec 174.) In the case at bar,
what rules are to guide the provincial boards in the exercise of their
discretionary power to determine whether or not the Probation Act shall
apply in their respective provinces? What standards are fixed by the
Act? We do not find any and none has been pointed to us by the
respondents. The probation Act does not, by the force of any of its
provisions, fix and impose upon the provincial boards any standard or
guide in the exercise of their discretionary power. What is granted, if we
may use the language of Justice Cardozo in the recent case of
Schecter, supra, is a "roving commission" which enables the provincial
boards to exercise arbitrary discretion. By section 11 if the Act, the
legislature does not seemingly on its own authority extend the benefits
of the Probation Act to the provinces but in reality leaves the entire
matter for the various provincial boards to determine. In other words,
the provincial boards of the various provinces are to determine for
themselves, whether the Probation Law shall apply to their provinces or
not at all. The applicability and application of the Probation Act are
entirely placed in the hands of the provincial boards. If the provincial
board does not wish to have the Act applied in its province, all that it
has to do is to decline to appropriate the needed amount for the salary
of a probation officer. The plain language of the Act is not susceptible of
any other interpretation. This, to our minds, is a virtual surrender of
legislative power to the provincial boards.
"The true distinction", says Judge Ranney, "is between the delegation
of power to make the law, which necessarily involves a discretion as to
what it shall be, and conferring an authority or discretion as to its
execution, to be exercised under and in pursuance of the law. The first
cannot be done; to the latter no valid objection can be made."
(Cincinnati, W. & Z. R. Co. vs. Clinton County Comrs. [1852]; 1 Ohio
St., 77, 88. See also, Sutherland on Statutory Construction, sec 68.) To
the same effect are the decision of this court in Municipality of Cardona
vs. Municipality of Binangonan ([1917], 36 Phil., 547); Rubi vs.
Provincial Board of Mindoro ([1919],39 Phil., 660) and Cruz vs.
Youngberg ([1931], 56 Phil., 234). In the first of these cases, this court
sustained the validity of the law conferring upon the Governor-General
authority to adjust provincial and municipal boundaries. In the second
case, this court held it lawful for the legislature to direct non-Christian
inhabitants to take up their habitation on unoccupied lands to be
selected by the provincial governor and approved by the provincial
board. In the third case, it was held proper for the legislature to vest in
the Governor-General authority to suspend or not, at his discretion, the
prohibition of the importation of the foreign cattle, such prohibition to be
raised "if the conditions of the country make this advisable or if
deceased among foreign cattle has ceased to be a menace to the
agriculture and livestock of the lands."
It should be observed that in the case at bar we are not concerned with
the simple transference of details of execution or the promulgation by
executive or administrative officials of rules and regulations to carry into
effect the provisions of a law. If we were, recurrence to our own
decisions would be sufficient. (U. S. vs. Barrias [1908], 11 Phil., 327;
U.S. vs. Molina [1914], 29 Phil., 119; Alegre vs. Collector of Customs
[1929], 53 Phil., 394; Cebu Autobus Co. vs. De Jesus [1931], 56 Phil.,
446; U. S. vs. Gomez [1915], 31 Phil., 218; Rubi vs. Provincial Board of
Mindoro [1919], 39 Phil., 660.)
It is connected, however, that a legislative act may be made to the
effect as law after it leaves the hands of the legislature. It is true that
laws may be made effective on certain contingencies, as by
proclamation of the executive or the adoption by the people of a
particular community (6 R. C. L., 116, 170-172; Cooley, Constitutional
Limitations, 8th ed., Vol. I, p. 227). In Wayman vs. Southard ([1825], 10
Wheat. 1; 6 Law. ed., 253), the Supreme Court of the United State
ruled that the legislature may delegate a power not legislative which it
may itself rightfully exercise.(Vide, also, Dowling vs. Lancashire Ins.
Co. [1896], 92 Wis., 63; 65 N. W., 738; 31 L. R. A., 112.) The power to
ascertain facts is such a power which may be delegated. There is
nothing essentially legislative in ascertaining the existence of facts or
conditions as the basis of the taking into effect of a law. That is a
mental process common to all branches of the government. (Dowling
vs. Lancashire Ins. Co., supra; In re Village of North Milwaukee [1896],
93 Wis., 616; 97 N.W., 1033; 33 L.R.A., 938; Nash vs. Fries [1906], 129
Wis., 120; 108 N.W., 210; Field vs. Clark [1892], 143 U.S., 649; 12 Sup.
Ct., 495; 36 Law. ed., 294.) Notwithstanding the apparent tendency,
however, to relax the rule prohibiting delegation of legislative authority
on account of the complexity arising from social and economic forces at
work in this modern industrial age (Pfiffner, Public Administration [1936]
ch. XX; Laski, "The Mother of Parliaments", foreign Affairs, July, 1931,
Vol. IX, No. 4, pp. 569-579; Beard, "Squirt-Gun Politics", in Harper's
Monthly Magazine, July, 1930, Vol. CLXI, pp. 147, 152), the orthodox
pronouncement of Judge Cooley in his work on Constitutional
Limitations finds restatement in Prof. Willoughby's treatise on the
Constitution of the United States in the following language — speaking
of declaration of legislative power to administrative agencies: "The
principle which permits the legislature to provide that the administrative
agent may determine when the circumstances are such as require the
application of a law is defended upon the ground that at the time this
authority is granted, the rule of public policy, which is the essence of
the legislative act, is determined by the legislature. In other words, the
legislature, as it its duty to do, determines that, under given
circumstances, certain executive or administrative action is to be taken,
and that, under other circumstances, different of no action at all is to be
taken. What is thus left to the administrative official is not the legislative
determination of what public policy demands, but simply the
ascertainment of what the facts of the case require to be done
according to the terms of the law by which he is governed." (Willoughby
on the Constitution of the United States, 2nd ed., Vol. II, p. 1637.) In
Miller vs. Mayer, etc., of New York [1883], 109 U.S., 3 Sup. Ct. Rep.,
228; 27 Law. ed., 971, 974), it was said: "The efficiency of an Act as a
declaration of legislative will must, of course, come from Congress, but
the ascertainment of the contingency upon which the Act shall take
effect may be left to such agencies as it may designate." (See, also, 12
C.J., p. 864; State vs. Parker [1854], 26 Vt., 357; Blanding vs. Burr
[1859], 13 Cal., 343, 258.) The legislature, then may provide that a
contingencies leaving to some other person or body the power to
determine when the specified contingencies has arisen. But, in the case
at bar, the legislature has not made the operation of the Prohibition Act
contingent upon specified facts or conditions to be ascertained by the
provincial board. It leaves, as we have already said, the entire
operation or non-operation of the law upon the provincial board. the
discretion vested is arbitrary because it is absolute and unlimited. A
provincial board need not investigate conditions or find any fact, or
await the happening of any specified contingency. It is bound by no
rule, — limited by no principle of expendiency announced by the
legislature. It may take into consideration certain facts or conditions;
and, again, it may not. It may have any purpose or no purpose at all. It
need not give any reason whatsoever for refusing or failing to
appropriate any funds for the salary of a probation officer. This is a
matter which rest entirely at its pleasure. The fact that at some future
time — we cannot say when — the provincial boards may appropriate
funds for the salaries of probation officers and thus put the law into
operation in the various provinces will not save the statute. The time of
its taking into effect, we reiterate, would yet be based solely upon the
will of the provincial boards and not upon the happening of a certain
specified contingency, or upon the ascertainment of certain facts or
conditions by a person or body other than legislature itself.
The various provincial boards are, in practical effect, endowed with the
power of suspending the operation of the Probation Law in their
respective provinces. In some jurisdiction, constitutions provided that
laws may be suspended only by the legislature or by its authority. Thus,
section 28, article I of the Constitution of Texas provides that "No power
of suspending laws in this state shall be exercised except by the
legislature"; and section 26, article I of the Constitution of Indiana
provides "That the operation of the laws shall never be suspended,
except by authority of the General Assembly." Yet, even provisions of
this sort do not confer absolute power of suspension upon the
legislature. While it may be undoubted that the legislature may suspend
a law, or the execution or operation of a law, a law may not be
suspended as to certain individuals only, leaving the law to be enjoyed
by others. The suspension must be general, and cannot be made for
individual cases or for particular localities. In Holden vs. James ([1814],
11 Mass., 396; 6 Am. Dec., 174, 177, 178), it was said:
By the twentieth article of the declaration of rights in the
constitution of this commonwealth, it is declared that the
power of suspending the laws, or the execution of the laws,
ought never to be exercised but by the legislature, or by
authority derived from it, to be exercised in such particular
cases only as the legislature shall expressly provide for. Many
of the articles in that declaration of rights were adopted from
the Magna Charta of England, and from the bill of rights
 passed in the reign of William and Mary. The bill of rights
contains an enumeration of the oppressive acts of James II,
tending to subvert and extirpate the protestant religion, and
the laws and liberties of the kingdom; and the first of them is
the assuming and exercising a power of dispensing with and
suspending the laws, and the execution of the laws without
consent of parliament. The first article in the claim or
declaration of rights contained in the statute is, that the
exercise of such power, by legal authority without consent of
parliament, is illegal. In the tenth section of the same statute it
is further declared and enacted, that "No dispensation by non
obstante of or to any statute, or part thereof, should be
allowed; but the same should be held void and of no effect,
except a dispensation be allowed of in such statute." There is
an implied reservation of authority in the parliament to
exercise the power here mentioned; because, according to
the theory of the English Constitution, "that absolute despotic
power, which must in all governments reside somewhere," is
intrusted to the parliament: 1 Bl. Com., 160.
The principles of our government are widely different in this
particular. Here the sovereign and absolute power resides in
the people; and the legislature can only exercise what is
delegated to them according to the constitution. It is obvious
that the exercise of the power in question would be equally
oppressive to the subject, and subversive of his right to
protection, "according to standing laws," whether exercised by
one man or by a number of men. It cannot be supposed that
the people when adopting this general principle from the
English bill of rights and inserting it in our constitution,
intended to bestow by implication on the general court one of
the most odious and oppressive prerogatives of the ancient
kings of England. It is manifestly contrary to the first principles
of civil liberty and natural justice, and to the spirit of our
constitution and laws, that any one citizen should enjoy
privileges and advantages which are denied to all others
under like circumstances; or that ant one should be subject to
losses, damages, suits, or actions from which all others under
like circumstances are exempted.
To illustrate the principle: A section of a statute relative to dogs made
the owner of any dog liable to the owner of domestic animals wounded
by it for the damages without proving a knowledge of it vicious
disposition. By a provision of the act, power was given to the board of
supervisors to determine whether or not during the current year their
county should be governed by the provisions of the act of which that
section constituted a part. It was held that the legislature could not
confer that power. The court observed that it could no more confer such
a power than to authorize the board of supervisors of a county to
abolish in such county the days of grace on commercial paper, or to
suspend the statute of limitations. (Slinger vs. Henneman [1875], 38
Wis., 504.) A similar statute in Missouri was held void for the same
reason in State vs. Field ([1853, 17 Mo., 529;59 Am. Dec., 275.) In that
case a general statute formulating a road system contained a provision
that "if the county court of any county should be of opinion that the
provisions of the act should not be enforced, they might, in their
discretion, suspend the operation of the same for any specified length
of time, and thereupon the act should become inoperative in such
county for the period specified in such order; and thereupon order the
roads to be opened and kept in good repair, under the laws theretofore
in force." Said the court: ". . . this act, by its own provisions, repeals the
inconsistent provisions of a former act, and yet it is left to the county
court to say which act shall be enforce in their county. The act does not
submit the question to the county court as an original question, to be
decided by that tribunal, whether the act shall commence its operation
within the county; but it became by its own terms a law in every county
not excepted by name in the act. It did not, then, require the county
court to do any act in order to give it effect. But being the law in the
county, and having by its provisions superseded and abrogated the
inconsistent provisions of previous laws, the county court is . . .
empowered, to suspend this act and revive the repealed provisions of
the former act. When the question is before the county court for that
tribunal to determine which law shall be in force, it is urge before us that
the power then to be exercised by the court is strictly legislative power,
which under our constitution, cannot be delegated to that tribunal or to
any other body of men in the state. In the present case, the question is
not presented in the abstract; for the county court of Saline county, after
the act had been for several months in force in that county, did by order
suspend its operation; and during that suspension the offense was
committed which is the subject of the present indictment . . . ." (See
Mitchell vs. State [1901], 134 Ala., 392; 32 S., 687.)
True, the legislature may enact laws for a particular locality different
from those applicable to other localities and, while recognizing the force
of the principle hereinabove expressed, courts in may jurisdiction have
sustained the constitutionality of the submission of option laws to the
vote of the people. (6 R.C.L., p. 171.) But option laws thus sustained
treat of subjects purely local in character which should receive different
treatment in different localities placed under different circumstances.
"They relate to subjects which, like the retailing of intoxicating drinks, or
the running at large of cattle in the highways, may be differently
regarded in different localities, and they are sustained on what seems
to us the impregnable ground, that the subject, though not embraced
within the ordinary powers of municipalities to make by-laws and
ordinances, is nevertheless within the class of public regulations, in
respect to which it is proper that the local judgment should control."
(Cooley on Constitutional Limitations, 5th ed., p. 148.) So that, while we
do not deny the right of local self-government and the propriety of
leaving matters of purely local concern in the hands of local authorities
or for the people of small communities to pass upon, we believe that in
matters of general of general legislation like that which treats of
criminals in general, and as regards the general subject of probation,
discretion may not be vested in a manner so unqualified and absolute
as provided in Act No. 4221. True, the statute does not expressly state
that the provincial boards may suspend the operation of the Probation
Act in particular provinces but, considering that, in being vested with the
authority to appropriate or not the necessary funds for the salaries of
probation officers, they thereby are given absolute discretion to
determine whether or not the law should take effect or operate in their
respective provinces, the provincial boards are in reality empowered by
the legislature to suspend the operation of the Probation Act in
particular provinces, the Act to be held in abeyance until the provincial
boards should decide otherwise by appropriating the necessary funds.
The validity of a law is not tested by what has been done but by what
may be done under its provisions. (Walter E. Olsen & Co. vs. Aldanese
and Trinidad [1922], 43 Phil., 259; 12 C. J., p. 786.)
It in conceded that a great deal of latitude should be granted to the
legislature not only in the expression of what may be termed legislative
policy but in the elaboration and execution thereof. "Without this power,
legislation would become oppressive and yet imbecile." (People vs.
Reynolds, 5 Gilman, 1.) It has been said that popular government lives
because of the inexhaustible reservoir of power behind it. It is
unquestionable that the mass of powers of government is vested in the
representatives of the people and that these representatives are no
further restrained under our system than by the express language of
the instrument imposing the restraint, or by particular provisions which
by clear intendment, have that effect. (Angara vs. Electoral Commission
[1936], 35 Off. Ga., 23; Schneckenburger vs. Moran [1936], 35 Off.
Gaz., 1317.) But, it should be borne in mind that a constitution is both a
grant and a limitation of power and one of these time-honored
limitations is that, subject to certain exceptions, legislative power shall
not be delegated.
We conclude that section 11 of Act No. 4221 constitutes an improper
and unlawful delegation of legislative authority to the provincial boards
and is, for this reason, unconstitutional and void.
3. It is also contended that the Probation Act violates the provisions of
our Bill of Rights which prohibits the denial to any person of the equal
protection of the laws (Act. III, sec. 1 subsec. 1. Constitution of the
Philippines.)
This basic individual right sheltered by the Constitution is a restraint on
all the tree grand departments of our government and on the
subordinate instrumentalities and subdivision thereof, and on many
constitutional power, like the police power, taxation and eminent
domain. The equal protection of laws, sententiously observes the
Supreme Court of the United States, "is a pledge of the protection of
equal laws." (Yick Wo vs. Hopkins [1886], 118 U. S., 356; 30 Law. ed.,
220; 6 Sup. Ct. Rep., 10464; Perley vs. North Carolina, 249 U. S., 510;
39 Sup. Ct. Rep., 357; 63 Law. ed., 735.) Of course, what may be
regarded as a denial of the equal protection of the laws in a question
not always easily determined. No rule that will cover every case can be
formulated. (Connolly vs. Union Sewer Pipe Co. [1902], 184, U. S., 540;
22 Sup. Ct., Rep., 431; 46 Law. ed., 679.) Class legislation
discriminating against some and favoring others in prohibited. But
classification on a reasonable basis, and nor made arbitrarily or
capriciously, is permitted. (Finely vs. California [1911], 222 U. S., 28; 56
Law. ed., 75; 32 Sup. Ct. Rep., 13; Gulf. C. & S. F. Ry Co. vs. Ellis
[1897], 165 U. S., 150; 41 Law. ed., 666; 17 Sup. Ct. Rep., 255; Smith,
Bell & Co. vs. Natividad [1919], 40 Phil., 136.) The classification,
however, to be reasonable must be based on substantial distinctions
which make real differences; it must be germane to the purposes of the
law; it must not be limited to existing conditions only, and must apply
equally to each member of the class. (Borgnis vs. Falk. Co. [1911], 147
Wis., 327, 353; 133 N. W., 209; 3 N. C. C. A., 649; 37 L. R. A. [N. S.],
489; State vs. Cooley, 56 Minn., 540; 530-552; 58 N. W., 150; Lindsley
vs. Natural Carbonic Gas Co.[1911], 220 U. S., 61, 79, 55 Law. ed.,
369, 377; 31 Sup. Ct. Rep., 337; Ann. Cas., 1912C, 160; Lake Shore &
M. S. R. Co. vs. Clough [1917], 242 U.S., 375; 37 Sup. Ct. Rep., 144;
61 Law. ed., 374; Southern Ry. Co. vs. Greene [1910], 216 U. S., 400;
30 Sup. Ct. Rep., 287; 54 Law. ed., 536; 17 Ann. Cas., 1247; Truax vs.
Corrigan [1921], 257 U. S., 312; 12 C. J., pp. 1148, 1149.)
In the case at bar, however, the resultant inequality may be said to flow
from the unwarranted delegation of legislative power, although perhaps
this is not necessarily the result in every case. Adopting the example
given by one of the counsel for the petitioners in the course of his oral
argument, one province may appropriate the necessary fund to defray
the salary of a probation officer, while another province may refuse or
fail to do so. In such a case, the Probation Act would be in operation in
the former province but not in the latter. This means that a person
otherwise coming within the purview of the law would be liable to enjoy
the benefits of probation in one province while another person similarly
situated in another province would be denied those same benefits. This
is obnoxious discrimination. Contrariwise, it is also possible for all the
provincial boards to appropriate the necessary funds for the salaries of
the probation officers in their respective provinces, in which case no
inequality would result for the obvious reason that probation would be in
operation in each and every province by the affirmative action of
appropriation by all the provincial boards. On that hypothesis, every
person coming within the purview of the Probation Act would be entitled
to avail of the benefits of the Act. Neither will there be any resulting
inequality if no province, through its provincial board, should
appropriate any amount for the salary of the probation officer — which
is the situation now — and, also, if we accept the contention that, for
the purpose of the Probation Act, the City of Manila should be
considered as a province and that the municipal board of said city has
not made any appropriation for the salary of the probation officer.
These different situations suggested show, indeed, that while inequality
may result in the application of the law and in the conferment of the
benefits therein provided, inequality is not in all cases the necessary
result. But whatever may be the case, it is clear that in section 11 of the
Probation Act creates a situation in which discrimination and inequality
are permitted or allowed. There are, to be sure, abundant authorities
requiring actual denial of the equal protection of the law before court
should assume the task of setting aside a law vulnerable on that score,
but premises and circumstances considered, we are of the opinion that
section 11 of Act No. 4221 permits of the denial of the equal protection
of the law and is on that account bad. We see no difference between a
law which permits of such denial. A law may appear to be fair on its
face and impartial in appearance, yet, if it permits of unjust and illegal
discrimination, it is within the constitutional prohibitions. (By analogy,
Chy Lung vs. Freeman [1876], 292 U. S., 275; 23 Law. ed., 550;
Henderson vs. Mayor [1876], 92 U. S., 259; 23 Law. ed., 543; Ex parte
Virginia [1880], 100 U. S., 339; 25 Law. ed., 676; Neal vs. Delaware
[1881], 103 U. S., 370; 26 Law. ed., 567; Soon Hing vs. Crowley [1885],
113 U. S., 703; 28 Law. ed., 1145, Yick Wo vs. Hopkins [1886],118 U.
S., 356; 30 Law. ed., 220; Williams vs. Mississippi [1897], 170 U. S.,
218; 18 Sup. Ct. Rep., 583; 42 Law. ed., 1012; Bailey vs. Alabama
[1911], 219 U. S., 219; 31 Sup. Ct. Rep. 145; 55 Law. ed., Sunday Lake
Iron Co. vs. Wakefield [1918], 247 U. S., 450; 38 Sup. Ct. Rep., 495; 62
Law. ed., 1154.) In other words, statutes may be adjudged
unconstitutional because of their effect in operation (General Oil Co. vs.
Clain [1907], 209 U. S., 211; 28 Sup. Ct. Rep., 475; 52 Law. ed., 754;
State vs. Clement Nat. Bank [1911], 84 Vt., 167; 78 Atl., 944; Ann.
Cas., 1912D, 22). If the law has the effect of denying the equal
protection of the law it is unconstitutional. (6 R. C. L. p. 372; Civil Rights
Cases, 109 U. S., 3; 3 Sup. Ct. Rep., 18; 27 Law. ed., 835; Yick Wo vs.
Hopkins, supra; State vs. Montgomery, 94 Me., 192; 47 Atl., 165; 80 A.
S. R., 386; State vs. Dering, 84 Wis., 585; 54 N. W., 1104; 36 A. S. R.,
948; 19 L. R. A., 858.) Under section 11 of the Probation Act, not only
may said Act be in force in one or several provinces and not be in force
in other provinces, but one province may appropriate for the salary of
the probation officer of a given year — and have probation during that
year — and thereafter decline to make further appropriation, and have
no probation is subsequent years. While this situation goes rather to the
abuse of discretion which delegation implies, it is here indicated to
show that the Probation Act sanctions a situation which is intolerable in
a government of laws, and to prove how easy it is, under the Act, to
make the guaranty of the equality clause but "a rope of sand". (Brewer,
J. Gulf C. & S. F. Ry. Co. vs. Ellis [1897], 165 U. S., 150 154; 41 Law.
ed., 666; 17 Sup. Ct. Rep., 255.)lawph!1.net
Great reliance is placed by counsel for the respondents on the case of
Ocampo vs. United States ([1914], 234 U. S., 91; 58 Law. ed., 1231). In
that case, the Supreme Court of the United States affirmed the decision
of this court (18 Phil., 1) by declining to uphold the contention that there
was a denial of the equal protection of the laws because, as held in
Missouri vs. Lewis (Bowman vs. Lewis) decided in 1880 (101 U. S.,
220; 25 Law. ed., 991), the guaranty of the equality clause does not
require territorial uniformity. It should be observed, however, that this
case concerns the right to preliminary investigations in criminal cases
originally granted by General Orders No. 58. No question of legislative
authority was involved and the alleged denial of the equal protection of
the laws was the result of the subsequent enactment of Act No. 612,
amending the charter of the City of Manila (Act No. 813) and providing
in section 2 thereof that "in cases triable only in the court of first
instance of the City of Manila, the defendant . . . shall not be entitled as
of right to a preliminary examination in any case where the prosecuting
attorney, after a due investigation of the facts . . . shall have presented
an information against him in proper form . . . ." Upon the other hand,
an analysis of the arguments and the decision indicates that the
investigation by the prosecuting attorney — although not in the form
had in the provinces — was considered a reasonable substitute for the
City of Manila, considering the peculiar conditions of the city as found
and taken into account by the legislature itself.
Reliance is also placed on the case of Missouri vs. Lewis, supra. That
case has reference to a situation where the constitution of Missouri
permits appeals to the Supreme Court of the state from final judgments
of any circuit court, except those in certain counties for which counties
the constitution establishes a separate court of appeals called St. Louis
Court of Appeals. The provision complained of, then, is found in the
constitution itself and it is the constitution that makes the apportionment
of territorial jurisdiction.
We are of the opinion that section 11 of the Probation Act is
unconstitutional and void because it is also repugnant to equal-
protection clause of our Constitution.
Section 11 of the Probation Act being unconstitutional and void for the
reasons already stated, the next inquiry is whether or not the entire Act
should be avoided.
In seeking the legislative intent, the presumption is against
any mutilation of a statute, and the courts will resort to
elimination only where an unconstitutional provision is
interjected into a statute otherwise valid, and is so
independent and separable that its removal will leave the
constitutional features and purposes of the act substantially
unaffected by the process. (Riccio vs. Hoboken, 69 N. J.
Law., 649, 662; 63 L. R. A., 485; 55 Atl., 1109, quoted in
Williams vs. Standard Oil Co. [1929], 278 U.S., 235, 240; 73
Law. ed., 287, 309; 49 Sup. Ct. Rep., 115; 60 A. L. R., 596.)
In Barrameda vs. Moir ([1913], 25 Phil., 44, 47), this court
stated the well-established rule concerning partial invalidity of
statutes in the following language:
. . . where part of the a statute is void, as repugnant to the
Organic Law, while another part is valid, the valid portion, if
separable from the valid, may stand and be enforced. But in
order to do this, the valid portion must be in so far
independent of the invalid portion that it is fair to presume that
the Legislative would have enacted it by itself if they had
supposed that they could not constitutionally enact the other.
(Mutual Loan Co. vs. Martell, 200 Mass., 482; 86 N. E., 916;
128 A. S. R., 446; Supervisors of Holmes Co. vs. Black Creek
Drainage District, 99 Miss., 739; 55 Sou., 963.) Enough must
remain to make a complete, intelligible, and valid statute,
which carries out the legislative intent. (Pearson vs. Bass. 132
Ga., 117; 63 S. E., 798.) The void provisions must be
eliminated without causing results affecting the main purpose
of the Act, in a manner contrary to the intention of the
Legislature. (State vs. A. C. L. R., Co., 56 Fla., 617, 642; 47
Sou., 969; Harper vs. Galloway, 58 Fla., 255; 51 Sou., 226;
26 L. R. A., N. S., 794; Connolly vs. Union Sewer Pipe Co.,
184 U. S., 540, 565; People vs. Strassheim, 240 Ill., 279, 300;
88 N. E., 821; 22 L. R. A., N. S., 1135; State vs. Cognevich,
124 La., 414; 50 Sou., 439.) The language used in the invalid
part of a statute can have no legal force or efficacy for any
purpose whatever, and what remains must express the
legislative will, independently of the void part, since the court
has no power to legislate. (State vs. Junkin, 85 Neb., 1; 122
N. W., 473; 23 L. R. A., N. S., 839; Vide, also,. U. S., vs.
Rodriguez [1918], 38 Phil., 759; Pollock vs. Farmers' Loan
and Trust Co. [1895], 158 U. S., 601, 635; 39 Law. ed., 1108,
1125; 15 Sup. Ct. Rep., 912; 6 R.C.L., 121.)
It is contended that even if section 11, which makes the Probation Act
applicable only in those provinces in which the respective provincial
boards provided for the salaries of probation officers were inoperative
on constitutional grounds, the remainder of the Act would still be valid
and may be enforced. We should be inclined to accept the suggestions
but for the fact that said section is, in our opinion, is inseparably linked
with the other portions of the Act that with the elimination of the section
what would be left is the bare idealism of the system, devoid of any
practical benefit to a large number of people who may be deserving of
the intended beneficial result of that system. The clear policy of the law,
as may be gleaned from a careful examination of the whole context, is
to make the application of the system dependent entirely upon the
affirmative action of the different provincial boards through
appropriation of the salaries for probation officers at rates not lower
than those provided for provincial fiscals. Without such action on the
part of the various boards, no probation officers would be appointed by
the Secretary of Justice to act in the provinces. The Philippines is
divided or subdivided into provinces and it needs no argument to show
that if not one of the provinces — and this is the actual situation now —
appropriate the necessary fund for the salary of a probation officer,
probation under Act No. 4221 would be illusory. There can be no
probation without a probation officer. Neither can there be a probation
officer without the probation system.
Section 2 of the Acts provides that the probation officer shall supervise
and visit the probationer. Every probation officer is given, as to the
person placed in probation under his care, the powers of the police
officer. It is the duty of the probation officer to see that the conditions
which are imposed by the court upon the probationer under his care are
complied with. Among those conditions, the following are enumerated
in section 3 of the Act:
 That the probationer (a) shall indulge in no injurious or vicious
habits;
(b) Shall avoid places or persons of disreputable or harmful
character;
(c) Shall report to the probation officer as directed by the court
or probation officers;
(d) Shall permit the probation officer to visit him at reasonable
times at his place of abode or elsewhere;
(e) Shall truthfully answer any reasonable inquiries on the part
of the probation officer concerning his conduct or condition;
"(f) Shall endeavor to be employed regularly; "(g) Shall remain
or reside within a specified place or locality;
(f) Shall make reparation or restitution to the aggrieved parties
for actual damages or losses caused by his offense;
(g) Shall comply with such orders as the court may from time
to time make; and
(h) Shall refrain from violating any law, statute, ordinance, or
any by-law or regulation, promulgated in accordance with law.
The court is required to notify the probation officer in writing of the
period and terms of probation. Under section 4, it is only after the
period of probation, the submission of a report of the probation officer
and appropriate finding of the court that the probationer has complied
with the conditions of probation that probation may be definitely
terminated and the probationer finally discharged from supervision.
Under section 5, if the court finds that there is non-compliance with said
conditions, as reported by the probation officer, it may issue a warrant
for the arrest of the probationer and said probationer may be committed
with or without bail. Upon arraignment and after an opportunity to be
heard, the court may revoke, continue or modify the probation, and if
revoked, the court shall order the execution of the sentence originally
imposed. Section 6 prescribes the duties of probation officers: "It shall
be the duty of every probation officer to furnish to all persons placed on
probation under his supervision a statement of the period and
conditions of their probation, and to instruct them concerning the same;
to keep informed concerning their conduct and condition; to aid and
encourage them by friendly advice and admonition, and by such other
measures, not inconsistent with the conditions imposed by court as
may seem most suitable, to bring about improvement in their conduct
and condition; to report in writing to the court having jurisdiction over
said probationers at least once every two months concerning their
conduct and condition; to keep records of their work; make such report
as are necessary for the information of the Secretary of Justice and as
the latter may require; and to perform such other duties as are
consistent with the functions of the probation officer and as the court or
judge may direct. The probation officers provided for in this Act may act
as parole officers for any penal or reformatory institution for adults
when so requested by the authorities thereof, and, when designated by
the Secretary of Justice shall act as parole officer of persons released
on parole under Act Number Forty-one Hundred and Three, without
additional compensation."
It is argued, however, that even without section 11 probation officers
maybe appointed in the provinces under section 10 of Act which
provides as follows:
There is hereby created in the Department of Justice and
subject to its supervision and control, a Probation Office under
the direction of a Chief Probation Officer to be appointed by
the Governor-General with the advise and consent of the
Senate who shall receive a salary of four eight hundred pesos
per annum. To carry out this Act there is hereby appropriated
out of any funds in the Insular Treasury not otherwise
appropriated, the sum of fifty thousand pesos to be disbursed
by the Secretary of Justice, who is hereby authorized to
appoint probation officers and the administrative personnel of
the probation officer under civil service regulations from
among those who possess the qualifications, training and
experience prescribed by the Bureau of Civil Service, and
shall fix the compensation of such probation officers and
administrative personnel until such positions shall have been
included in the Appropriation Act.
But the probation officers and the administrative personnel referred to
in the foregoing section are clearly not those probation officers required
to be appointed for the provinces under section 11. It may be said,
reddendo singula singulis, that the probation officers referred to in
section 10 above-quoted are to act as such, not in the various
provinces, but in the central office known as the Probation Office
established in the Department of Justice, under the supervision of the
Chief Probation Officer. When the law provides that "the probation
officer" shall investigate and make reports to the court (secs. 1 and 4);
that "the probation officer" shall supervise and visit the probationer
(sec. 2; sec. 6, par. d); that the probationer shall report to the
"probationer officer" (sec. 3, par. c.), shall allow "the probationer officer"
to visit him (sec. 3, par. d), shall truthfully answer any reasonable
inquiries on the part of "the probation officer" concerning his conduct or
condition (sec. 3, par. 4); that the court shall notify "the probation
officer" in writing of the period and terms of probation (sec. 3, last par.),
it means the probation officer who is in charge of a particular
probationer in a particular province. It never could have been intention
of the legislature, for instance, to require the probationer in Batanes, to
report to a probationer officer in the City of Manila, or to require a
probation officer in Manila to visit the probationer in the said province of
Batanes, to place him under his care, to supervise his conduct, to
instruct him concerning the conditions of his probation or to perform
such other functions as are assigned to him by law.
That under section 10 the Secretary of Justice may appoint as many
probation officers as there are provinces or groups of provinces is, of
course possible. But this would be arguing on what the law may be or
should be and not on what the law is. Between is and ought there is a
far cry. The wisdom and propriety of legislation is not for us to pass
upon. We may think a law better otherwise than it is. But much as has
been said regarding progressive interpretation and judicial legislation
we decline to amend the law. We are not permitted to read into the law
matters and provisions which are not there. Not for any purpose — not
even to save a statute from the doom of invalidity.
Upon the other hand, the clear intention and policy of the law is not to
make the Insular Government defray the salaries of probation officers in
the provinces but to make the provinces defray them should they desire
to have the Probation Act apply thereto. The sum of P50,000,
appropriated "to carry out the purposes of this Act", is to be applied,
among other things, for the salaries of probation officers in the central
office at Manila. These probation officers are to receive such
compensations as the Secretary of Justice may fix "until such positions
shall have been included in the Appropriation Act". It was the intention
of the legislature to empower the Secretary of Justice to fix the salaries
of the probation officers in the provinces or later on to include said
salaries in an appropriation act. Considering, further, that the sum of
P50,000 appropriated in section 10 is to cover, among other things, the
salaries of the administrative personnel of the Probation Office, what
would be left of the amount can hardly be said to be sufficient to pay
even nominal salaries to probation officers in the provinces. We take
judicial notice of the fact that there are 48 provinces in the Philippines
and we do not think it is seriously contended that, with the fifty
thousand pesos appropriated for the central office, there can be in each
province, as intended, a probation officer with a salary not lower than
that of a provincial fiscal. If this a correct, the contention that without
section 11 of Act No. 4221 said act is complete is an impracticable
thing under the remainder of the Act, unless it is conceded that in our
case there can be a system of probation in the provinces without
probation officers.
Probation as a development of a modern penology is a commendable
system. Probation laws have been enacted, here and in other
countries, to permit what modern criminologist call the "individualization
of the punishment", the adjustment of the penalty to the character of the
criminal and the circumstances of his particular case. It provides a
period of grace in order to aid in the rehabilitation of a penitent offender.
It is believed that, in any cases, convicts may be reformed and their
development into hardened criminals aborted. It, therefore, takes
advantage of an opportunity for reformation and avoids imprisonment
so long as the convicts gives promise of reform. (United States vs.
Murray [1925], 275 U. S., 347 357, 358; 72 Law. ed., 309; 312, 313; 48
Sup. Ct. Rep., 146; Kaplan vs. Hecht, 24 F. [2d], 664, 665.) The
Welfare of society is its chief end and aim. The benefit to the individual
convict is merely incidental. But while we believe that probation is
commendable as a system and its implantation into the Philippines
should be welcomed, we are forced by our inescapable duty to set the
law aside because of the repugnancy to our fundamental law.
In arriving at this conclusion, we have endeavored to consider the
different aspects presented by able counsel for both parties, as well in
their memorandums as in their oral argument. We have examined the
cases brought to our attention, and others we have been able to reach
in the short time at our command for the study and deliberation of this
case. In the examination of the cases and in then analysis of the legal
principles involved we have inclined to adopt the line of action which in
our opinion, is supported better reasoned authorities and is more
conducive to the general welfare. (Smith, Bell & Co. vs. Natividad
[1919], 40 Phil., 136.) Realizing the conflict of authorities, we have
declined to be bound by certain adjudicated cases brought to our
attention, except where the point or principle is settled directly or by
clear implication by the more authoritative pronouncements of the
Supreme Court of the United States. This line of approach is justified
because:
(a) The constitutional relations between the Federal and the
State governments of the United States and the dual
character of the American Government is a situation which
does not obtain in the Philippines;
(b) The situation of s state of the American Union of the
District of Columbia with reference to the Federal Government
of the United States is not the situation of the province with
respect to the Insular Government (Art. I, sec. 8 cl. 17 and
10th Amendment, Constitution of the United States; Sims vs.
Rives, 84 Fed. [2d], 871),
 (c) The distinct federal and the state judicial organizations of
the United States do not embrace the integrated judicial
system of the Philippines (Schneckenburger vs. Moran [1936],
35 Off. Gaz., p. 1317);
(d) "General propositions do not decide concrete cases"
(Justice Holmes in Lochner vs. New York [1904], 198 U. S.,
45, 76; 49 Law. ed., 937, 949) and, "to keep pace with . . .
new developments of times and circumstances" (Chief Justice
Waite in Pensacola Tel. Co. vs. Western Union Tel. Co.
[1899], 96 U. S., 1, 9; 24 Law. ed., 708; Yale Law Journal,
Vol. XXIX, No. 2, Dec. 1919, 141, 142), fundamental
principles should be interpreted having in view existing local
conditions and environment.
Act No. 4221 is hereby declared unconstitutional and void and the writ
of prohibition is, accordingly, granted. Without any pronouncement
regarding costs. So ordered.
G.R. No. 148560               November 19, 2001
JOSEPH EJERCITO ESTRADA, petitioner,
vs.
SANDIGANBAYAN (Third Division) and PEOPLE OF THE
PHILIPPINES, respondents.
DECISION
BELLOSILLO, J.:
JOHN STUART MILL, in his essay On Liberty, unleashes the full fury of
his pen in defense of the rights of the individual from the vast powers of
the State and the inroads of societal pressure. But even as he draws a
sacrosanct line demarcating the limits on individuality beyond which the
State cannot tread - asserting that "individual spontaneity" must be
allowed to flourish with very little regard to social interference - he
veritably acknowledges that the exercise of rights and liberties is
imbued with a civic obligation, which society is justified in enforcing at
all cost, against those who would endeavor to withhold fulfillment. Thus
he says -
The sole end for which mankind is warranted, individually or
collectively, in interfering with the liberty of action of any of their
number, is self-protection. The only purpose for which power can be
rightfully exercised over any member of a civilized community, against
his will, is to prevent harm to others.
Parallel to individual liberty is the natural and illimitable right of the
State to self-preservation. With the end of maintaining the integrity and
cohesiveness of the body politic, it behooves the State to formulate a
system of laws that would compel obeisance to its collective wisdom
and inflict punishment for non-observance.
The movement from Mill's individual liberalism to unsystematic
collectivism wrought changes in the social order, carrying with it a new
formulation of fundamental rights and duties more attuned to the
imperatives of contemporary socio-political ideologies. In the process,
the web of rights and State impositions became tangled and obscured,
enmeshed in threads of multiple shades and colors, the skein irregular
and broken. Antagonism, often outright collision, between the law as
the expression of the will of the State, and the zealous attempts by its
members to preserve their individuality and dignity, inevitably followed.
It is when individual rights are pitted against State authority that judicial
conscience is put to its severest test.
Petitioner Joseph Ejercito Estrada, the highest-ranking official to be
prosecuted under RA 7080 (An Act Defining and Penalizing the Crime
of Plunder),1 as amended by RA 7659,2 wishes to impress upon us
that the assailed law is so defectively fashioned that it crosses that thin
but distinct line which divides the valid from the constitutionally infirm.
He therefore makes a stringent call for this Court to subject the Plunder
Law to the crucible of constitutionality mainly because, according to
him, (a) it suffers from the vice of vagueness; (b) it dispenses with the
"reasonable doubt" standard in criminal prosecutions; and, (c) it
abolishes the element of mens rea in crimes already punishable under
The Revised Penal Code, all of which are purportedly clear violations of
the fundamental rights of the accused to due process and to be
informed of the nature and cause of the accusation against him.
Specifically, the provisions of the Plunder Law claimed by petitioner to
have transgressed constitutional boundaries are Secs. 1, par. (d), 2 and
4 which are reproduced hereunder:
Section 1. x x x x (d) "Ill-gotten wealth" means any asset, property,
business, enterprise or material possession of any person within the
purview of Section Two (2) hereof, acquired by him directly or indirectly
through dummies, nominees, agents, subordinates and/or business
associates by any combination or series of the following means or
similar schemes:
(1) Through misappropriation, conversion, misuse, or
malversation of public funds or raids on the public treasury;
(2) By receiving, directly or indirectly, any commission, gift,
share, percentage, kickbacks or any other form of pecuniary
benefit from any person and/or entity in connection with any
government contract or project or by reason of the office or
position of the public office concerned;
(3) By the illegal or fraudulent conveyance or disposition of
assets belonging to the National Government or any of its
subdivisions, agencies or instrumentalities, or government
owned or controlled corporations and their subsidiaries;
(4) By obtaining, receiving or accepting directly or indirectly
any shares of stock, equity or any other form of interest or
participation including the promise of future employment in
any business enterprise or undertaking;
(5) By establishing agricultural, industrial or commercial
monopolies or other combinations and/or implementation of
decrees and orders intended to benefit particular persons or
special interests; or
(6) By taking advantage of official position, authority,
relationship, connection or influence to unjustly enrich himself
or themselves at the expense and to the damage and
prejudice of the Filipino people and the Republic of the
Philippines.
Section 2. Definition of the Crime of Plunder, Penalties. - Any public
officer who, by himself or in connivance with members of his family,
relatives by affinity or consanguinity, business associates, subordinates
or other persons, amasses, accumulates or acquires ill-gotten wealth
through a combination or series of overt or criminal acts as
described in Section 1 (d) hereof, in the aggregate amount or total
value of at least fifty million pesos (P50,000,000.00) shall be guilty of
the crime of plunder and shall be punished by reclusion perpetua to
death. Any person who participated with the said public officer in the
commission of an offense contributing to the crime of plunder shall
likewise be punished for such offense. In the imposition of penalties,
the degree of participation and the attendance of mitigating and
extenuating circumstances as provided by the Revised Penal Code
shall be considered by the court. The court shall declare any and all ill-
gotten wealth and their interests and other incomes and assets
including the properties and shares of stocks derived from the deposit
or investment thereof forfeited in favor of the State (underscoring
supplied).
Section 4. Rule of Evidence. - For purposes of establishing the crime of
plunder, it shall not be necessary to prove each and every criminal
act done by the accused in furtherance of the scheme or
conspiracy to amass, accumulate or acquire ill-gotten wealth, it
being sufficient to establish beyond reasonable doubt a pattern of
overt or criminal acts indicative of the overall unlawful scheme or
conspiracy (underscoring supplied).
On 4 April 2001 the Office of the Ombudsman filed before the
Sandiganbayan eight (8) separate Informations, docketed as: (a) Crim.
Case No. 26558, for violation of RA 7080, as amended by RA 7659; (b)
Crim. Cases Nos. 26559 to 26562, inclusive, for violation of Secs. 3,
par. (a), 3, par. (a), 3, par. (e) and 3, par. (e), of RA 3019 (Anti-Graft
and Corrupt Practices Act), respectively; (c) Crim. Case No. 26563, for
violation of Sec. 7, par. (d), of RA 6713 (The Code of Conduct and
Ethical Standards for Public Officials and Employees); (d) Crim. Case
No. 26564, for Perjury (Art. 183 of The Revised Penal Code); and, (e)
Crim. Case No. 26565, for Illegal Use Of An Alias (CA No. 142, as
amended by RA 6085).
On 11 April 2001 petitioner filed an Omnibus Motion for the remand of
the case to the Ombudsman for preliminary investigation with respect to
specification "d" of the charges in the Information in Crim. Case No.
26558; and, for reconsideration/reinvestigation of the offenses under
specifications "a," "b," and "c" to give the accused an opportunity to file
counter-affidavits and other documents necessary to prove lack of
probable cause. Noticeably, the grounds raised were only lack of
preliminary investigation, reconsideration/reinvestigation of offenses,
and opportunity to prove lack of probable cause. The purported
ambiguity of the charges and the vagueness of the law under which
they are charged were never raised in that Omnibus Motion thus
indicating the explicitness and comprehensibility of the Plunder Law.
On 25 April 2001 the Sandiganbayan, Third Division, issued a
Resolution in Crim. Case No. 26558 finding that "a probable cause for
the offense of PLUNDER exists to justify the issuance of warrants for
the arrest of the accused." On 25 June 2001 petitioner's motion for
reconsideration was denied by the Sandiganbayan.
On 14 June 2001 petitioner moved to quash the Information in Crim.
Case No. 26558 on the ground that the facts alleged therein did not
constitute an indictable offense since the law on which it was based
was unconstitutional for vagueness, and that the Amended Information
for Plunder charged more than one (1) offense. On 21 June 2001 the
Government filed its Opposition to the Motion to Quash, and five (5)
days later or on 26 June 2001 petitioner submitted his Reply to the
Opposition. On 9 July 2001 the Sandiganbayan denied petitioner's
Motion to Quash.
As concisely delineated by this Court during the oral arguments on 18
September 2001, the issues for resolution in the instant petition for
certiorari are: (a) The Plunder Law is unconstitutional for being vague;
(b) The Plunder Law requires less evidence for proving the predicate
crimes of plunder and therefore violates the rights of the accused to
due process; and, (c) Whether Plunder as defined in RA 7080 is a
malum prohibitum, and if so, whether it is within the power of Congress
to so classify it.
Preliminarily, the whole gamut of legal concepts pertaining to the
validity of legislation is predicated on the basic principle that a
legislative measure is presumed to be in harmony with the
Constitution.3 Courts invariably train their sights on this fundamental
rule whenever a legislative act is under a constitutional attack, for it is
the postulate of constitutional adjudication. This strong predilection for
constitutionality takes its bearings on the idea that it is forbidden for one
branch of the government to encroach upon the duties and powers of
another. Thus it has been said that the presumption is based on the
deference the judicial branch accords to its coordinate branch - the
legislature.
If there is any reasonable basis upon which the legislation may firmly
rest, the courts must assume that the legislature is ever conscious of
the borders and edges of its plenary powers, and has passed the law
with full knowledge of the facts and for the purpose of promoting what is
right and advancing the welfare of the majority. Hence in determining
whether the acts of the legislature are in tune with the fundamental law,
courts should proceed with judicial restraint and act with caution and
forbearance. Every intendment of the law must be adjudged by the
courts in favor of its constitutionality, invalidity being a measure of last
resort. In construing therefore the provisions of a statute, courts must
first ascertain whether an interpretation is fairly possible to sidestep the
question of constitutionality.
In La Union Credit Cooperative, Inc. v. Yaranon4 we held that as long
as there is some basis for the decision of the court, the constitutionality
of the challenged law will not be touched and the case will be decided
on other available grounds. Yet the force of the presumption is not
sufficient to catapult a fundamentally deficient law into the safe environs
of constitutionality. Of course, where the law clearly and palpably
transgresses the hallowed domain of the organic law, it must be struck
down on sight lest the positive commands of the fundamental law be
unduly eroded.
Verily, the onerous task of rebutting the presumption weighs heavily on
the party challenging the validity of the statute. He must demonstrate
beyond any tinge of doubt that there is indeed an infringement of the
constitution, for absent such a showing, there can be no finding of
unconstitutionality. A doubt, even if well-founded, will hardly suffice. As
tersely put by Justice Malcolm, "To doubt is to sustain."5 And
petitioner has miserably failed in the instant case to discharge his
burden and overcome the presumption of constitutionality of the
Plunder Law.
As it is written, the Plunder Law contains ascertainable standards and
well-defined parameters which would enable the accused to determine
the nature of his violation. Section 2 is sufficiently explicit in its
description of the acts, conduct and conditions required or forbidden,
and prescribes the elements of the crime with reasonable certainty and
particularity. Thus -
1. That the offender is a public officer who acts by himself or
in connivance with members of his family, relatives by affinity
or consanguinity, business associates, subordinates or other
persons;
2. That he amassed, accumulated or acquired ill-gotten
wealth through a combination or series of the following overt
or criminal acts: (a) through misappropriation, conversion,
misuse, or malversation of public funds or raids on the public
treasury; (b) by receiving, directly or indirectly, any
commission, gift, share, percentage, kickback or any other
form of pecuniary benefits from any person and/or entity in
connection with any government contract or project or by
reason of the office or position of the public officer; (c) by the
illegal or fraudulent conveyance or disposition of assets
belonging to the National Government or any of its
subdivisions, agencies or instrumentalities of Government
owned or controlled corporations or their subsidiaries; (d) by
obtaining, receiving or accepting directly or indirectly any
shares of stock, equity or any other form of interest or
participation including the promise of future employment in
any business enterprise or undertaking; (e) by establishing
agricultural, industrial or commercial monopolies or other
combinations and/or implementation of decrees and orders
intended to benefit particular persons or special interests; or
(f) by taking advantage of official position, authority,
relationship, connection or influence to unjustly enrich himself
or themselves at the expense and to the damage and
prejudice of the Filipino people and the Republic of the
Philippines; and,
3. That the aggregate amount or total value of the ill-gotten
wealth amassed, accumulated or acquired is at least
₱50,000,000.00.
As long as the law affords some comprehensible guide or rule that
would inform those who are subject to it what conduct would render
them liable to its penalties, its validity will be sustained. It must
sufficiently guide the judge in its application; the counsel, in defending
one charged with its violation; and more importantly, the accused, in
identifying the realm of the proscribed conduct. Indeed, it can be
understood with little difficulty that what the assailed statute punishes is
the act of a public officer in amassing or accumulating ill-gotten wealth
of at least ₱50,000,000.00 through a series or combination of acts
enumerated in Sec. 1, par. (d), of the Plunder Law.
In fact, the amended Information itself closely tracks the language of
the law, indicating with reasonable certainty the various elements of the
offense which petitioner is alleged to have committed:
"The undersigned Ombudsman, Prosecutor and OIC-Director, EPIB,
Office of the Ombudsman, hereby accuses former PRESIDENT OF
THE REPUBLIC OF THE PHILIPPINES, Joseph Ejercito Estrada,
a.k.a. 'ASIONG SALONGA' and a.k.a. 'JOSE VELARDE,' together with
Jose 'Jinggoy' Estrada, Charlie 'Atong' Ang, Edward Serapio, Yolanda
T. Ricaforte, Alma Alfaro, JOHN DOE a.k.a. Eleuterio Tan OR Eleuterio
Ramos Tan or Mr. Uy, Jane Doe a.k.a. Delia Rajas, and John DOES &
Jane Does, of the crime of Plunder, defined and penalized under R.A.
No. 7080, as amended by Sec. 12 of R.A. No. 7659, committed as
follows:
That during the period from June, 1998 to January 2001, in the
Philippines, and within the jurisdiction of this Honorable Court, accused
Joseph Ejercito Estrada, THEN A PRESIDENT OF THE REPUBLIC
OF THE PHILIPPINES, by himself AND/OR in
CONNIVANCE/CONSPIRACY with his co-accused, WHO ARE
MEMBERS OF HIS FAMILY, RELATIVES BY AFFINITY OR
CONSANGUINITY, BUSINESS ASSOCIATES, SUBORDINATES
AND/OR OTHER PERSONS, BY TAKING UNDUE ADVANTAGE OF
HIS OFFICIAL POSITION, AUTHORITY, RELATIONSHIP,
CONNECTION, OR INFLUENCE, did then and there willfully,
unlawfully and criminally amass, accumulate and acquire BY
HIMSELF, DIRECTLY OR INDIRECTLY, ill-gotten wealth in the
aggregate amount or TOTAL VALUE of FOUR BILLION NINETY
SEVEN MILLION EIGHT HUNDRED FOUR THOUSAND ONE
HUNDRED SEVENTY THREE PESOS AND SEVENTEEN
CENTAVOS (₱4,097,804,173.17), more or less, THEREBY
UNJUSTLY ENRICHING HIMSELF OR THEMSELVES AT THE
EXPENSE AND TO THE DAMAGE OF THE FILIPINO PEOPLE AND
THE REPUBLIC OF THE PHILIPPINES, through ANY OR A
combination OR A series of overt OR criminal acts, OR SIMILAR
SCHEMES OR MEANS, described as follows:
(a) by receiving OR collecting, directly or indirectly, on
SEVERAL INSTANCES, MONEY IN THE AGGREGATE
AMOUNT OF FIVE HUNDRED FORTY-FIVE MILLION
PESOS (₱545,000,000.00), MORE OR LESS, FROM
ILLEGAL GAMBLING IN THE FORM OF GIFT, SHARE,
PERCENTAGE, KICKBACK OR ANY FORM OF
PECUNIARY BENEFIT, BY HIMSELF AND/OR in connection
with co-accused CHARLIE 'ATONG' ANG, Jose 'Jinggoy'
Estrada, Yolanda T. Ricaforte, Edward Serapio, AND JOHN
DOES AND JANE DOES, in consideration OF TOLERATION
OR PROTECTION OF ILLEGAL GAMBLING;
(b) by DIVERTING, RECEIVING, misappropriating, converting
OR misusing DIRECTLY OR INDIRECTLY, for HIS OR
THEIR PERSONAL gain and benefit, public funds in the
amount of ONE HUNDRED THIRTY MILLION PESOS
(₱130,000,000.00), more or less, representing a portion of the
TWO HUNDRED MILLION PESOS (₱200,000,000.00)
tobacco excise tax share allocated for the province of Ilocos
Sur under R.A. No. 7171, by himself and/or in connivance
with co-accused Charlie 'Atong' Ang, Alma Alfaro, JOHN DOE
a.k.a. Eleuterio Ramos Tan or Mr. Uy, Jane Doe a.k.a. Delia
Rajas, AND OTHER JOHN DOES & JANE DOES; (italic
supplied).
(c) by directing, ordering and compelling, FOR HIS
PERSONAL GAIN AND BENEFIT, the Government Service
Insurance System (GSIS) TO PURCHASE 351,878,000
SHARES OF STOCKS, MORE OR LESS, and the Social
Security System (SSS), 329,855,000 SHARES OF STOCK,
MORE OR LESS, OF THE BELLE CORPORATION IN THE
AMOUNT OF MORE OR LESS ONE BILLION ONE
HUNDRED TWO MILLION NINE HUNDRED SIXTY FIVE
THOUSAND SIX HUNDRED SEVEN PESOS AND FIFTY
CENTAVOS (₱1,102,965,607.50) AND MORE OR LESS
SEVEN HUNDRED FORTY FOUR MILLION SIX HUNDRED
TWELVE THOUSAND AND FOUR HUNDRED FIFTY
PESOS (₱744,612,450.00), RESPECTIVELY, OR A TOTAL
OF MORE OR LESS ONE BILLION EIGHT HUNDRED
FORTY SEVEN MILLION FIVE HUNDRED SEVENTY EIGHT
THOUSAND FIFTY SEVEN PESOS AND FIFTY CENTAVOS
(₱1,847,578,057.50); AND BY COLLECTING OR
RECEIVING, DIRECTLY OR INDIRECTLY, BY HIMSELF
AND/OR IN CONNIVANCE WITH JOHN DOES AND JANE
DOES, COMMISSIONS OR PERCENTAGES BY REASON
OF SAID PURCHASES OF SHARES OF STOCK IN THE
AMOUNT OF ONE HUNDRED EIGHTY NINE MILLION
SEVEN HUNDRED THOUSAND PESOS (₱189,700,000.00)
MORE OR LESS, FROM THE BELLE CORPORATION
WHICH BECAME PART OF THE DEPOSIT IN THE
EQUITABLE-PCI BANK UNDER THE ACCOUNT NAME
'JOSE VELARDE;'
(d) by unjustly enriching himself FROM COMMISSIONS,
GIFTS, SHARES, PERCENTAGES, KICKBACKS, OR ANY
FORM OF PECUNIARY BENEFITS, IN CONNIVANCE WITH
JOHN DOES AND JANE DOES, in the amount of MORE OR
LESS THREE BILLION TWO HUNDRED THIRTY THREE
MILLION ONE HUNDRED FOUR THOUSAND ONE
HUNDRED SEVENTY THREE PESOS AND SEVENTEEN
CENTAVOS (₱3,233,104,173.17) AND DEPOSITING THE
SAME UNDER HIS ACCOUNT NAME 'JOSE VELARDE' AT
THE EQUITABLE-PCI BANK."
We discern nothing in the foregoing that is vague or ambiguous - as
there is obviously none - that will confuse petitioner in his defense.
Although subject to proof, these factual assertions clearly show that the
elements of the crime are easily understood and provide adequate
contrast between the innocent and the prohibited acts. Upon such
unequivocal assertions, petitioner is completely informed of the
accusations against him as to enable him to prepare for an intelligent
defense.
Petitioner, however, bewails the failure of the law to provide for the
statutory definition of the terms "combination" and "series" in the key
phrase "a combination or series of overt or criminal acts" found in Sec.
1, par. (d), and Sec. 2, and the word "pattern" in Sec. 4. These
omissions, according to petitioner, render the Plunder Law
unconstitutional for being impermissibly vague and overbroad and deny
him the right to be informed of the nature and cause of the accusation
against him, hence, violative of his fundamental right to due process.
The rationalization seems to us to be pure sophistry. A statute is not
rendered uncertain and void merely because general terms are used
therein, or because of the employment of terms without defining them;6
much less do we have to define every word we use. Besides, there is
no positive constitutional or statutory command requiring the legislature
to define each and every word in an enactment. Congress is not
restricted in the form of expression of its will, and its inability to so
define the words employed in a statute will not necessarily result in the
vagueness or ambiguity of the law so long as the legislative will is clear,
or at least, can be gathered from the whole act, which is distinctly
expressed in the Plunder Law.
Moreover, it is a well-settled principle of legal hermeneutics that words
of a statute will be interpreted in their natural, plain and ordinary
acceptation and signification,7 unless it is evident that the legislature
intended a technical or special legal meaning to those words.8 The
intention of the lawmakers - who are, ordinarily, untrained philologists
and lexicographers - to use statutory phraseology in such a manner is
always presumed. Thus, Webster's New Collegiate Dictionary contains
the following commonly accepted definition of the words "combination"
and "series:"
Combination - the result or product of combining; the act or process of
combining. To combine is to bring into such close relationship as to
obscure individual characters.
Series - a number of things or events of the same class coming one
after another in spatial and temporal succession.
That Congress intended the words "combination" and "series" to be
understood in their popular meanings is pristinely evident from the
legislative deliberations on the bill which eventually became RA 7080 or
the Plunder Law:
DELIBERATIONS OF THE BICAMERAL COMMITTEE ON JUSTICE,
7 May 1991
REP. ISIDRO: I am just intrigued again by our definition of plunder. We
say THROUGH A COMBINATION OR SERIES OF OVERT OR
CRIMINAL ACTS AS MENTIONED IN SECTION ONE HEREOF. Now
when we say combination, we actually mean to say, if there are two or
more means, we mean to say that number one and two or number one
and something else are included, how about a series of the same act?
For example, through misappropriation, conversion, misuse, will these
be included also?
REP. GARCIA: Yeah, because we say a series.
REP. ISIDRO: Series.
REP. GARCIA: Yeah, we include series.
REP. ISIDRO: But we say we begin with a combination.
REP. GARCIA: Yes.
REP. ISIDRO: When we say combination, it seems that -
REP. GARCIA: Two.
REP. ISIDRO: Not only two but we seem to mean that two of the
enumerated means not twice of one enumeration.
REP. GARCIA: No, no, not twice.
REP. ISIDRO: Not twice?
REP. GARCIA: Yes. Combination is not twice - but combination, two
acts.
REP. ISIDRO: So in other words, that’s it. When we say combination,
we mean, two different acts. It cannot be a repetition of the same act.
REP. GARCIA: That be referred to series, yeah.
REP. ISIDRO: No, no. Supposing one act is repeated, so there are two.
REP. GARCIA: A series.
REP. ISIDRO: That’s not series. Its a combination. Because when we
say combination or series, we seem to say that two or more, di ba?
REP. GARCIA: Yes, this distinguishes it really from ordinary crimes.
That is why, I said, that is a very good suggestion because if it is only
one act, it may fall under ordinary crime but we have here a
combination or series of overt or criminal acts. So x x x x
REP. GARCIA: Series. One after the other eh di....
SEN. TANADA: So that would fall under the term "series?"
REP. GARCIA: Series, oo.
REP. ISIDRO: Now, if it is a combination, ano, two misappropriations....
REP. GARCIA: Its not... Two misappropriations will not be combination.
Series.
REP. ISIDRO: So, it is not a combination?
REP. GARCIA: Yes.
REP. ISIDRO: When you say combination, two different?
REP. GARCIA: Yes.
SEN. TANADA: Two different.
REP. ISIDRO: Two different acts.
REP. GARCIA: For example, ha...
REP. ISIDRO: Now a series, meaning, repetition...
DELIBERATIONS ON SENATE BILL NO. 733, 6 June 1989
SENATOR MACEDA: In line with our interpellations that sometimes
"one" or maybe even "two" acts may already result in such a big
amount, on line 25, would the Sponsor consider deleting the words "a
series of overt or," to read, therefore: "or conspiracy COMMITTED by
criminal acts such as." Remove the idea of necessitating "a series."
Anyway, the criminal acts are in the plural.
SENATOR TANADA: That would mean a combination of two or more of
the acts mentioned in this.
THE PRESIDENT: Probably two or more would be....
SENATOR MACEDA: Yes, because "a series" implies several or many;
two or more.
SENATOR TANADA: Accepted, Mr. President x x x x
THE PRESIDENT: If there is only one, then he has to be prosecuted
under the particular crime. But when we say "acts of plunder" there
should be, at least, two or more.
SENATOR ROMULO: In other words, that is already covered by
existing laws, Mr. President.
Thus when the Plunder Law speaks of "combination," it is referring to at
least two (2) acts falling under different categories of enumeration
provided in Sec. 1, par. (d), e.g., raids on the public treasury in Sec. 1,
par. (d), subpar. (1), and fraudulent conveyance of assets belonging to
the National Government under Sec. 1, par. (d), subpar. (3).
On the other hand, to constitute a series" there must be two (2) or more
overt or criminal acts falling under the same category of enumeration
found in Sec. 1, par. (d), say, misappropriation, malversation and raids
on the public treasury, all of which fall under Sec. 1, par. (d), subpar.
(1). Verily, had the legislature intended a technical or distinctive
meaning for "combination" and "series," it would have taken greater
pains in specifically providing for it in the law.
As for "pattern," we agree with the observations of the Sandiganbayan9
that this term is sufficiently defined in Sec. 4, in relation to Sec. 1, par.
(d), and Sec. 2 -
x x x x under Sec. 1 (d) of the law, a 'pattern' consists of at least a
combination or series of overt or criminal acts enumerated in
subsections (1) to (6) of Sec. 1 (d). Secondly, pursuant to Sec. 2 of the
law, the pattern of overt or criminal acts is directed towards a common
purpose or goal which is to enable the public officer to amass,
accumulate or acquire ill-gotten wealth. And thirdly, there must either
be an 'overall unlawful scheme' or 'conspiracy' to achieve said common
goal. As commonly understood, the term 'overall unlawful scheme'
indicates a 'general plan of action or method' which the principal
accused and public officer and others conniving with him follow to
achieve the aforesaid common goal. In the alternative, if there is no
such overall scheme or where the schemes or methods used by
multiple accused vary, the overt or criminal acts must form part of a
conspiracy to attain a common goal.
Hence, it cannot plausibly be contended that the law does not give a
fair warning and sufficient notice of what it seeks to penalize. Under the
circumstances, petitioner's reliance on the "void-for-vagueness"
doctrine is manifestly misplaced. The doctrine has been formulated in
various ways, but is most commonly stated to the effect that a statute
establishing a criminal offense must define the offense with sufficient
definiteness that persons of ordinary intelligence can understand what
conduct is prohibited by the statute. It can only be invoked against that
specie of legislation that is utterly vague on its face, i.e., that which
cannot be clarified either by a saving clause or by construction.
A statute or act may be said to be vague when it lacks comprehensible
standards that men of common intelligence must necessarily guess at
its meaning and differ in its application. In such instance, the statute is
repugnant to the Constitution in two (2) respects - it violates due
process for failure to accord persons, especially the parties targeted by
it, fair notice of what conduct to avoid; and, it leaves law enforcers
unbridled discretion in carrying out its provisions and becomes an
arbitrary flexing of the Government muscle.10 But the doctrine does not
apply as against legislations that are merely couched in imprecise
language but which nonetheless specify a standard though defectively
phrased; or to those that are apparently ambiguous yet fairly applicable
to certain types of activities. The first may be "saved" by proper
construction, while no challenge may be mounted as against the
second whenever directed against such activities.11 With more reason,
the doctrine cannot be invoked where the assailed statute is clear and
free from ambiguity, as in this case.
The test in determining whether a criminal statute is void for uncertainty
is whether the language conveys a sufficiently definite warning as to the
proscribed conduct when measured by common understanding and
practice.12 It must be stressed, however, that the "vagueness" doctrine
merely requires a reasonable degree of certainty for the statute to be
upheld - not absolute precision or mathematical exactitude, as
petitioner seems to suggest. Flexibility, rather than meticulous
specificity, is permissible as long as the metes and bounds of the
statute are clearly delineated. An act will not be held invalid merely
because it might have been more explicit in its wordings or detailed in
its provisions, especially where, because of the nature of the act, it
would be impossible to provide all the details in advance as in all other
statutes.
Moreover, we agree with, hence we adopt, the observations of Mr.
Justice Vicente V. Mendoza during the deliberations of the Court that
the allegations that the Plunder Law is vague and overbroad do not
justify a facial review of its validity -
The void-for-vagueness doctrine states that "a statute which either
forbids or requires the doing of an act in terms so vague that men of
common intelligence must necessarily guess at its meaning and differ
as to its application, violates the first essential of due process of law."13
The overbreadth doctrine, on the other hand, decrees that "a
governmental purpose may not be achieved by means which sweep
unnecessarily broadly and thereby invade the area of protected
freedoms."14
A facial challenge is allowed to be made to a vague statute and to one
which is overbroad because of possible "chilling effect" upon protected
speech. The theory is that "[w]hen statutes regulate or proscribe
speech and no readily apparent construction suggests itself as a
vehicle for rehabilitating the statutes in a single prosecution, the
transcendent value to all society of constitutionally protected expression
is deemed to justify allowing attacks on overly broad statutes with no
requirement that the person making the attack demonstrate that his
own conduct could not be regulated by a statute drawn with narrow
specificity."15 The possible harm to society in permitting some
unprotected speech to go unpunished is outweighed by the possibility
that the protected speech of others may be deterred and perceived
grievances left to fester because of possible inhibitory effects of overly
broad statutes.
This rationale does not apply to penal statutes. Criminal statutes have
general in terrorem effect resulting from their very existence, and, if
facial challenge is allowed for this reason alone, the State may well be
prevented from enacting laws against socially harmful conduct. In the
area of criminal law, the law cannot take chances as in the area of free
speech.
The overbreadth and vagueness doctrines then have special
application only to free speech cases. They are inapt for testing the
validity of penal statutes. As the U.S. Supreme Court put it, in an
opinion by Chief Justice Rehnquist, "we have not recognized an
'overbreadth' doctrine outside the limited context of the First
Amendment."16 In Broadrick v. Oklahoma,17 the Court ruled that
"claims of facial overbreadth have been entertained in cases involving
statutes which, by their terms, seek to regulate only spoken words" and,
again, that "overbreadth claims, if entertained at all, have been curtailed
when invoked against ordinary criminal laws that are sought to be
applied to protected conduct." For this reason, it has been held that "a
facial challenge to a legislative act is the most difficult challenge to
mount successfully, since the challenger must establish that no set of
circumstances exists under which the Act would be valid."18 As for the
vagueness doctrine, it is said that a litigant may challenge a statute on
its face only if it is vague in all its possible applications. "A plaintiff who
engages in some conduct that is clearly proscribed cannot complain of
the vagueness of the law as applied to the conduct of others."19
In sum, the doctrines of strict scrutiny, overbreadth, and vagueness are
analytical tools developed for testing "on their faces" statutes in free
speech cases or, as they are called in American law, First Amendment
cases. They cannot be made to do service when what is involved is a
criminal statute. With respect to such statute, the established rule is
that "one to whom application of a statute is constitutional will not be
heard to attack the statute on the ground that impliedly it might also be
taken as applying to other persons or other situations in which its
application might be unconstitutional."20 As has been pointed out,
"vagueness challenges in the First Amendment context, like
overbreadth challenges typically produce facial invalidation, while
statutes found vague as a matter of due process typically are
invalidated [only] 'as applied' to a particular defendant."21
Consequently, there is no basis for petitioner's claim that this Court
review the Anti-Plunder Law on its face and in its entirety.
Indeed, "on its face" invalidation of statutes results in striking them
down entirely on the ground that they might be applied to parties not
before the Court whose activities are constitutionally protected.22 It
constitutes a departure from the case and controversy requirement of
the Constitution and permits decisions to be made without concrete
factual settings and in sterile abstract contexts.23 But, as the U.S.
Supreme Court pointed out in Younger v. Harris24
[T]he task of analyzing a proposed statute, pinpointing its deficiencies,
and requiring correction of these deficiencies before the statute is put
into effect, is rarely if ever an appropriate task for the judiciary. The
combination of the relative remoteness of the controversy, the impact
on the legislative process of the relief sought, and above all the
speculative and amorphous nature of the required line-by-line analysis
of detailed statutes, . . . ordinarily results in a kind of case that is wholly
unsatisfactory for deciding constitutional questions, whichever way they
might be decided.
For these reasons, "on its face" invalidation of statutes has been
described as "manifestly strong medicine," to be employed "sparingly
and only as a last resort,"25 and is generally disfavored.26 In
determining the constitutionality of a statute, therefore, its provisions
which are alleged to have been violated in a case must be examined in
the light of the conduct with which the defendant is charged.27
In light of the foregoing disquisition, it is evident that the purported
ambiguity of the Plunder Law, so tenaciously claimed and argued at
length by petitioner, is more imagined than real. Ambiguity, where none
exists, cannot be created by dissecting parts and words in the statute to
furnish support to critics who cavil at the want of scientific precision in
the law. Every provision of the law should be construed in relation and
with reference to every other part. To be sure, it will take more than
nitpicking to overturn the well-entrenched presumption of
constitutionality and validity of the Plunder Law. A fortiori, petitioner
cannot feign ignorance of what the Plunder Law is all about. Being one
of the Senators who voted for its passage, petitioner must be aware
that the law was extensively deliberated upon by the Senate and its
appropriate committees by reason of which he even registered his
affirmative vote with full knowledge of its legal implications and sound
constitutional anchorage.
The parallel case of Gallego v. Sandiganbayan28 must be mentioned if
only to illustrate and emphasize the point that courts are loathed to
declare a statute void for uncertainty unless the law itself is so
imperfect and deficient in its details, and is susceptible of no
reasonable construction that will support and give it effect. In that case,
petitioners Gallego and Agoncillo challenged the constitutionality of
Sec. 3, par. (e), of The Anti-Graft and Corrupt Practices Act for being
vague. Petitioners posited, among others, that the term "unwarranted"
is highly imprecise and elastic with no common law meaning or settled
definition by prior judicial or administrative precedents; that, for its
vagueness, Sec. 3, par. (e), violates due process in that it does not give
fair warning or sufficient notice of what it seeks to penalize. Petitioners
further argued that the Information charged them with three (3) distinct
offenses, to wit: (a) giving of "unwarranted" benefits through manifest
partiality; (b) giving of "unwarranted" benefits through evident bad faith;
and, (c) giving of "unwarranted" benefits through gross inexcusable
negligence while in the discharge of their official function and that their
right to be informed of the nature and cause of the accusation against
them was violated because they were left to guess which of the three
(3) offenses, if not all, they were being charged and prosecuted.
In dismissing the petition, this Court held that Sec. 3, par. (e), of The
Anti-Graft and Corrupt Practices Act does not suffer from the
constitutional defect of vagueness. The phrases "manifest partiality,"
"evident bad faith," and "gross and inexcusable negligence" merely
describe the different modes by which the offense penalized in Sec. 3,
par. (e), of the statute may be committed, and the use of all these
phrases in the same Information does not mean that the indictment
charges three (3) distinct offenses.
The word 'unwarranted' is not uncertain. It seems lacking adequate or
official support; unjustified; unauthorized (Webster, Third International
Dictionary, p. 2514); or without justification or adequate reason
(Philadelphia Newspapers, Inc. v. US Dept. of Justice, C.D. Pa., 405 F.
Supp. 8, 12, cited in Words and Phrases, Permanent Edition, Vol. 43-A
1978, Cumulative Annual Pocket Part, p. 19).
The assailed provisions of the Anti-Graft and Corrupt Practices Act
consider a corrupt practice and make unlawful the act of the public
officer in:
x x x or giving any private party any unwarranted benefits, advantage or
preference in the discharge of his official, administrative or judicial
functions through manifest partiality, evident bad faith or gross
inexcusable negligence, x x x (Section 3 [e], Rep. Act 3019, as
amended).
It is not at all difficult to comprehend that what the aforequoted penal
provisions penalize is the act of a public officer, in the discharge of his
official, administrative or judicial functions, in giving any private party
benefits, advantage or preference which is unjustified, unauthorized or
without justification or adequate reason, through manifest partiality,
evident bad faith or gross inexcusable negligence.
In other words, this Court found that there was nothing vague or
ambiguous in the use of the term "unwarranted" in Sec. 3, par. (e), of
The Anti-Graft and Corrupt Practices Act, which was understood in its
primary and general acceptation. Consequently, in that case,
petitioners' objection thereto was held inadequate to declare the section
unconstitutional.
On the second issue, petitioner advances the highly stretched theory
that Sec. 4 of the Plunder Law circumvents the immutable obligation of
the prosecution to prove beyond reasonable doubt the predicate acts
constituting the crime of plunder when it requires only proof of a pattern
of overt or criminal acts showing unlawful scheme or conspiracy -
SEC. 4. Rule of Evidence. - For purposes of establishing the crime of
plunder, it shall not be necessary to prove each and every criminal act
done by the accused in furtherance of the scheme or conspiracy to
amass, accumulate or acquire ill-gotten wealth, it being sufficient to
establish beyond reasonable doubt a pattern of overt or criminal acts
indicative of the overall unlawful scheme or conspiracy.
The running fault in this reasoning is obvious even to the simplistic
mind. In a criminal prosecution for plunder, as in all other crimes, the
accused always has in his favor the presumption of innocence which is
guaranteed by the Bill of Rights, and unless the State succeeds in
demonstrating by proof beyond reasonable doubt that culpability lies,
the accused is entitled to an acquittal.29 The use of the "reasonable
doubt" standard is indispensable to command the respect and
confidence of the community in the application of criminal law. It is
critical that the moral force of criminal law be not diluted by a standard
of proof that leaves people in doubt whether innocent men are being
condemned. It is also important in our free society that every individual
going about his ordinary affairs has confidence that his government
cannot adjudge him guilty of a criminal offense without convincing a
proper factfinder of his guilt with utmost certainty. This "reasonable
doubt" standard has acquired such exalted stature in the realm of
constitutional law as it gives life to the Due Process Clause which
protects the accused against conviction except upon proof beyond
reasonable doubt of every fact necessary to constitute the crime with
which he is charged.30 The following exchanges between Rep. Rodolfo
Albano and Rep. Pablo Garcia on this score during the deliberations in
the floor of the House of Representatives are elucidating -
DELIBERATIONS OF THE HOUSE OF REPRESENTATIVES ON RA
7080, 9 October 1990
MR. ALBANO: Now, Mr. Speaker, it is also elementary in our criminal
law that what is alleged in the information must be proven beyond
reasonable doubt. If we will prove only one act and find him guilty of the
other acts enumerated in the information, does that not work against
the right of the accused especially so if the amount committed, say, by
falsification is less than ₱100 million, but the totality of the crime
committed is ₱100 million since there is malversation, bribery,
falsification of public document, coercion, theft?
MR. GARCIA: Mr. Speaker, not everything alleged in the information
needs to be proved beyond reasonable doubt. What is required to be
proved beyond reasonable doubt is every element of the crime
charged. For example, Mr. Speaker, there is an enumeration of the
things taken by the robber in the information – three pairs of pants,
pieces of jewelry. These need not be proved beyond reasonable doubt,
but these will not prevent the conviction of a crime for which he was
charged just because, say, instead of 3 pairs of diamond earrings the
prosecution proved two. Now, what is required to be proved beyond
reasonable doubt is the element of the offense.
MR. ALBANO: I am aware of that, Mr. Speaker, but considering that in
the crime of plunder the totality of the amount is very important, I feel
that such a series of overt criminal acts has to be taken singly. For
instance, in the act of bribery, he was able to accumulate only ₱50,000
and in the crime of extortion, he was only able to accumulate ₱1
million. Now, when we add the totality of the other acts as required
under this bill through the interpretation on the rule of evidence, it is just
one single act, so how can we now convict him?
MR. GARCIA: With due respect, Mr. Speaker, for purposes of proving
an essential element of the crime, there is a need to prove that element
beyond reasonable doubt. For example, one essential element of the
crime is that the amount involved is ₱100 million. Now, in a series of
defalcations and other acts of corruption in the enumeration the total
amount would be ₱110 or ₱120 million, but there are certain acts that
could not be proved, so, we will sum up the amounts involved in those
transactions which were proved. Now, if the amount involved in these
transactions, proved beyond reasonable doubt, is ₱100 million, then
there is a crime of plunder (underscoring supplied).
It is thus plain from the foregoing that the legislature did not in any
manner refashion the standard quantum of proof in the crime of
plunder. The burden still remains with the prosecution to prove beyond
any iota of doubt every fact or element necessary to constitute the
crime.
The thesis that Sec. 4 does away with proof of each and every
component of the crime suffers from a dismal misconception of the
import of that provision. What the prosecution needs to prove beyond
reasonable doubt is only a number of acts sufficient to form a
combination or series which would constitute a pattern and involving an
amount of at least ₱50,000,000.00. There is no need to prove each and
every other act alleged in the Information to have been committed by
the accused in furtherance of the overall unlawful scheme or conspiracy
to amass, accumulate or acquire ill-gotten wealth. To illustrate,
supposing that the accused is charged in an Information for plunder
with having committed fifty (50) raids on the public treasury. The
prosecution need not prove all these fifty (50) raids, it being sufficient to
prove by pattern at least two (2) of the raids beyond reasonable doubt
provided only that they amounted to at least ₱50,000,000.00.31
A reading of Sec. 2 in conjunction with Sec. 4, brings us to the logical
conclusion that "pattern of overt or criminal acts indicative of the overall
unlawful scheme or conspiracy" inheres in the very acts of
accumulating, acquiring or amassing hidden wealth. Stated otherwise,
such pattern arises where the prosecution is able to prove beyond
reasonable doubt the predicate acts as defined in Sec. 1, par. (d).
Pattern is merely a by-product of the proof of the predicate acts. This
conclusion is consistent with reason and common sense. There would
be no other explanation for a combination or series of
overt or criminal acts to stash ₱50,000,000.00 or more, than "a scheme
or conspiracy to amass, accumulate or acquire ill gotten wealth." The
prosecution is therefore not required to make a deliberate and
conscious effort to prove pattern as it necessarily follows with the
establishment of a series or combination of the predicate acts.
Relative to petitioner's contentions on the purported defect of Sec. 4 is
his submission that "pattern" is "a very important element of the crime
of plunder;" and that Sec. 4 is "two pronged, (as) it contains a rule of
evidence and a substantive element of the crime," such that without it
the accused cannot be convicted of plunder -
JUSTICE BELLOSILLO: In other words, cannot an accused be
convicted under the Plunder Law without applying Section 4 on the
Rule of Evidence if there is proof beyond reasonable doubt of the
commission of the acts complained of?
ATTY. AGABIN: In that case he can be convicted of individual crimes
enumerated in the Revised Penal Code, but not plunder.
JUSTICE BELLOSILLO: In other words, if all the elements of the crime
are proved beyond reasonable doubt without applying Section 4, can
you not have a conviction under the Plunder Law?
ATTY. AGABIN: Not a conviction for plunder, your Honor.
JUSTICE BELLOSILLO: Can you not disregard the application of Sec.
4 in convicting an accused charged for violation of the Plunder Law?
ATTY. AGABIN: Well, your Honor, in the first place Section 4 lays down
a substantive element of the law x x x x
JUSTICE BELLOSILLO: What I said is - do we have to avail of Section
4 when there is proof beyond reasonable doubt on the acts charged
constituting plunder?
ATTY. AGABIN: Yes, your Honor, because Section 4 is two pronged, it
contains a rule of evidence and it contains a substantive element of the
crime of plunder. So, there is no way by which we can avoid Section 4.
JUSTICE BELLOSILLO: But there is proof beyond reasonable doubt
insofar as the predicate crimes charged are concerned that you do not
have to go that far by applying Section 4?
ATTY. AGABIN: Your Honor, our thinking is that Section 4 contains a
very important element of the crime of plunder and that cannot be
avoided by the prosecution.32
We do not subscribe to petitioner's stand. Primarily, all the essential
elements of plunder can be culled and understood from its definition in
Sec. 2, in relation to Sec. 1, par. (d), and "pattern" is not one of them.
Moreover, the epigraph and opening clause of Sec. 4 is clear and
unequivocal:
SEC. 4. Rule of Evidence. - For purposes of establishing the crime of
plunder x x x x
It purports to do no more than prescribe a rule of procedure for the
prosecution of a criminal case for plunder. Being a purely procedural
measure, Sec. 4 does not define or establish any substantive right in
favor of the accused but only operates in furtherance of a remedy. It is
only a means to an end, an aid to substantive law. Indubitably, even
without invoking Sec. 4, a conviction for plunder may be had, for what is
crucial for the prosecution is to present sufficient evidence to engender
that moral certitude exacted by the fundamental law to prove the guilt of
the accused beyond reasonable doubt. Thus, even granting for the
sake of argument that Sec. 4 is flawed and vitiated for the reasons
advanced by petitioner, it may simply be severed from the rest of the
provisions without necessarily resulting in the demise of the law; after
all, the existing rules on evidence can supplant Sec. 4 more than
enough. Besides, Sec. 7 of RA 7080 provides for a separability clause -
Sec. 7. Separability of Provisions. - If any provisions of this Act or the
application thereof to any person or circumstance is held invalid, the
remaining provisions of this Act and the application of such provisions
to other persons or circumstances shall not be affected thereby.
Implicit in the foregoing section is that to avoid the whole act from being
declared invalid as a result of the nullity of some of its provisions,
assuming that to be the case although it is not really so, all the
provisions thereof should accordingly be treated independently of each
other, especially if by doing so, the objectives of the statute can best be
achieved.
As regards the third issue, again we agree with Justice Mendoza that
plunder is a malum in se which requires proof of criminal intent. Thus,
he says, in his Concurring Opinion -
x x x Precisely because the constitutive crimes are mala in se the
element of mens rea must be proven in a prosecution for plunder. It is
noteworthy that the amended information alleges that the crime of
plunder was committed "willfully, unlawfully and criminally." It thus
alleges guilty knowledge on the part of petitioner.
In support of his contention that the statute eliminates the requirement
of mens rea and that is the reason he claims the statute is void,
petitioner cites the following remarks of Senator Tañada made during
the deliberation on S.B. No. 733:
SENATOR TAÑADA . . . And the evidence that will be required to
convict him would not be evidence for each and every individual
criminal act but only evidence sufficient to establish the conspiracy or
scheme to commit this crime of plunder.33
However, Senator Tañada was discussing §4 as shown by the
succeeding portion of the transcript quoted by petitioner:
SENATOR ROMULO: And, Mr. President, the Gentleman feels that it is
contained in Section 4, Rule of Evidence, which, in the Gentleman's
view, would provide for a speedier and faster process of attending to
this kind of cases?
SENATOR TAÑADA: Yes, Mr. President . . .34
Senator Tañada was only saying that where the charge is conspiracy to
commit plunder, the prosecution need not prove each and every
criminal act done to further the scheme or conspiracy, it being enough if
it proves beyond reasonable doubt a pattern of overt or ciminal acts
indicative of the overall unlawful scheme or conspiracy. As far as the
acts constituting the pattern are concerned, however, the elements of
the crime must be proved and the requisite mens rea must be shown.
Indeed, §2 provides that -
Any person who participated with the said public officer in the
commission of an offense contributing to the crime of plunder shall
likewise be punished for such offense. In the imposition of penalties,
the degree of participation and the attendance of mitigating and
extenuating circumstances, as provided by the Revised Penal Code,
shall be considered by the court.
The application of mitigating and extenuating circumstances in the
Revised Penal Code to prosecutions under the Anti-Plunder Law
indicates quite clearly that mens rea is an element of plunder since the
degree of responsibility of the offender is determined by his criminal
intent. It is true that §2 refers to "any person who participates with the
said public officer in the commission of an offense contributing to the
crime of plunder." There is no reason to believe, however, that it does
not apply as well to the public officer as principal in the crime. As
Justice Holmes said: "We agree to all the generalities about not
supplying criminal laws with what they omit, but there is no canon
against using common sense in construing laws as saying what they
obviously mean."35
Finally, any doubt as to whether the crime of plunder is a malum in se
must be deemed to have been resolved in the affirmative by the
decision of Congress in 1993 to include it among the heinous crimes
punishable by reclusion perpetua to death. Other heinous crimes are
punished with death as a straight penalty in R.A. No. 7659. Referring to
these groups of heinous crimes, this Court held in People v.
Echegaray:36
The evil of a crime may take various forms. There are crimes that are,
by their very nature, despicable, either because life was callously taken
or the victim is treated like an animal and utterly dehumanized as to
completely disrupt the normal course of his or her growth as a human
being . . . . Seen in this light, the capital crimes of kidnapping and
serious illegal detention for ransom resulting in the death of the victim
or the victim is raped, tortured, or subjected to dehumanizing acts;
destructive arson resulting in death; and drug offenses involving minors
or resulting in the death of the victim in the case of other crimes; as well
as murder, rape, parricide, infanticide, kidnapping and serious illegal
detention, where the victim is detained for more than three days or
serious physical injuries were inflicted on the victim or threats to kill him
were made or the victim is a minor, robbery with homicide, rape or
intentional mutilation, destructive arson, and carnapping where the
owner, driver or occupant of the carnapped vehicle is killed or raped,
which are penalized by reclusion perpetua to death, are clearly heinous
by their very nature.
There are crimes, however, in which the abomination lies in the
significance and implications of the subject criminal acts in the scheme
of the larger socio-political and economic context in which the state
finds itself to be struggling to develop and provide for its poor and
underprivileged masses. Reeling from decades of corrupt tyrannical
rule that bankrupted the government and impoverished the population,
the Philippine Government must muster the political will to dismantle
the culture of corruption, dishonesty, greed and syndicated criminality
that so deeply entrenched itself in the structures of society and the
psyche of the populace. [With the government] terribly lacking the
money to provide even the most basic services to its people, any form
of misappropriation or misapplication of government funds translates to
an actual threat to the very existence of government, and in turn, the
very survival of the people it governs over. Viewed in this context, no
less heinous are the effects and repercussions of crimes like qualified
bribery, destructive arson resulting in death, and drug offenses
involving government officials, employees or officers, that their
perpetrators must not be allowed to cause further destruction and
damage to society.
The legislative declaration in R.A. No. 7659 that plunder is a heinous
offense implies that it is a malum in se. For when the acts punished are
inherently immoral or inherently wrong, they are mala in se37 and it
does not matter that such acts are punished in a special law, especially
since in the case of plunder the predicate crimes are mainly mala in se.
Indeed, it would be absurd to treat prosecutions for plunder as though
they are mere prosecutions for violations of the Bouncing Check Law
(B.P. Blg. 22) or of an ordinance against jaywalking, without regard to
the inherent wrongness of the acts.
To clinch, petitioner likewise assails the validity of RA 7659, the
amendatory law of RA 7080, on constitutional grounds. Suffice it to say
however that it is now too late in the day for him to resurrect this long
dead issue, the same having been eternally consigned by People v.
Echegaray38 to the archives of jurisprudential history. The declaration
of this Court therein that RA 7659 is constitutionally valid stands as a
declaration of the State, and becomes, by necessary effect, assimilated
in the Constitution now as an integral part of it.
Our nation has been racked by scandals of corruption and obscene
profligacy of officials in high places which have shaken its very
foundation. The anatomy of graft and corruption has become more
elaborate in the corridors of time as unscrupulous people relentlessly
contrive more and more ingenious ways to bilk the coffers of the
government. Drastic and radical measures are imperative to fight the
increasingly sophisticated, extraordinarily methodical and economically
catastrophic looting of the national treasury. Such is the Plunder Law,
especially designed to disentangle those ghastly tissues of grand-scale
corruption which, if left unchecked, will spread like a malignant tumor
and ultimately consume the moral and institutional fiber of our nation.
The Plunder Law, indeed, is a living testament to the will of the
legislature to ultimately eradicate this scourge and thus secure society
against the avarice and other venalities in public office.
These are times that try men's souls. In the checkered history of this
nation, few issues of national importance can equal the amount of
interest and passion generated by petitioner's ignominious fall from the
highest office, and his eventual prosecution and trial under a virginal
statute. This continuing saga has driven a wedge of dissension among
our people that may linger for a long time. Only by responding to the
clarion call for patriotism, to rise above factionalism and prejudices,
shall we emerge triumphant in the midst of ferment.
PREMISES CONSIDERED, this Court holds that RA 7080 otherwise
known as the Plunder Law, as amended by RA 7659, is
CONSTITUTIONAL. Consequently, the petition to declare the law
unconstitutional is DISMISSED for lack of merit.
SO ORDERED.
DISSENTING OPINION
KAPUNAN, J.:
The primary duty of the Court is to render justice. The resolution of the
issues brought before it must be grounded on law, justice and the basic
tenets of due process, unswayed by the passions of the day or the
clamor of the multitudes, guided only by its members’ honest
conscience, clean hearts and their unsullied conviction to do what is
right under the law.
The issues posed by the instant petition are quite difficult. The task of
the Court to resolve the same is made more daunting because the case
involves a former President of the Republic who, in the eyes of certain
sectors of society, deserves to be punished. But the mandate of the
Court is to decide these issues solely on the basis of law and due
process, and regardless of the personalities involved. For indeed, the
rule of law and the right to due process are immutable principles that
should apply to all, even to those we hate. As Fr. Joaquin G. Bernas,
S.J., a noted constitutionalist, aptly puts it--
x x x the greater disaster would be if the Supreme Court should heed
the clamor for conviction and convict Estrada even under an
unconstitutional law but of the belief that Estrada deserves to be
punished. That would be tantamount to a rule of men and not of law. 1
The Basic Facts
The petition before us questions the constitutionality of Republic Act
No. 7080 (R.A. No. 7080 or Plunder Law), as amended by Republic Act
No. 7659,2 entitled "An Act Defining and Penalizing the Crime of
Plunder."3 This original petition for certiorari and prohibition against
Respondent Third Division of the Sandiganbayan filed by petitioner
Joseph Ejercito Estrada assails Respondent court’s Resolution, dated
July 9, 2001, denying his Motion to Quash the information against him
in Criminal Case No. 26558 for Plunder. Petitioner likewise prays that
the Sandiganbayan be prohibited and enjoined from proceeding with
his arraignment and trial in Criminal Case No. 26558 due to the
unconstitutionality of R. A. No. 7080.
On the heels of the finality of the joint decision of this Court in G.R. No.
146710 (Estrada vs. Desierto, et al.) and in G.R. No. 146738 (Estrada
vs. Macapagal-Arroyo), promulgated on April 3, 2001, upholding the
constitutionality of President Gloria Macapagal-Arroyo’s assumption of
office as President of the Republic of the Philippines and declaring that
the former President Joseph Ejercito Estrada no longer enjoyed
immunity from suit, the Ombudsman filed eight (8) Informations against
Estrada. These cases were Criminal Case No. 26558 (for Plunder);
Criminal Case No. 26559 (for Violation of Sec. 3[a] of Republic Act No.
3019); Criminal Case No. 26560 (for Violation of Sec. 3[a] of R.A. No.
3019); Criminal Case No. 26561 (for Violation of Sec. 3[e] of R.A.
3019); Criminal Case No. 26562 (for Violation of Sec. 3[e] of R.A. No.
3019); Criminal Case No. 26563 (for Violation of Sec. 7[d] of R.A. No.
6713); Criminal Case No. 26564 (for Perjury); and Criminal Case No.
26565 (for Illegal Use of Alias).
The aforementioned informations were raffled to the five divisions of the
Sandiganbayan. Criminal Case No. 26558 was raffled to the Third
Division of said court. The amended information against petitioner
charging violations of Section 2, in relation to Section (d) (1) (2) of the
statute reads:
That during the period from June, 1998 to January, 2001, in the
Philippines, and within the jurisdiction of this Honorable Court, accused
Joseph Ejercito Estrada, by himself and in conspiracy with his co-
accused, business associates and persons heretofore named, by taking
advantage of his official position, authority, connection or influence as
President of the Republic of the Philippines, did then and there wilfully,
unlawfully and criminally amass, accumulate and acquire ill-gotten
wealth, and unjustly enrich himself in the aggregate amount of
P4,097,804,173.17, more or less, through a combination and series of
overt and criminal acts, described as follows:
(a) by receiving, collecting, directly or indirectly, on many
instances, so-called "jueteng money" from gambling operators
in connivance with co-accused Jose ‘Jinggoy’ Estrada,
Yolanda T. Ricaforte and Edward Serapio, as witnessed by
Gov. Luis ‘Chavit’ Singson, among other witnesses, in the
aggregate amount of FIVE HUNDRED FORTY-FIVE MILLION
PESOS (P545,000.000.00), more or less, in consideration of
their protection from arrest or interference by law enforcers in
their illegal "jueteng" activities; and
(b) by misappropriating, converting and misusing for his gain
and benefit public fund in the amount of ONE HUNDRED
THIRTY MILLION PESOS (P130,000,000.00), more or less,
representing a portion of One Hundred Seventy Million Pesos
(P170,000,000.00) tobacco excise tax share allocated for the
Province of Ilocos Sur under R.A. No. 7171, in conspiracy
with co-accused Charlie ‘Atong’ Ang, Alma Alfaro, Eleuterio
Tan a.k.a. Eleuterio Ramos Tan or Mr. Uy, and Jane Doe
a.k.a. Delia Rajas, as witnessed by Gov. Luis ‘Chavit’
Singson, among other witnesses; and
(c) by directing, ordering and compelling the Government
Service Insurance System (GSIS) and the Social Security
System (SSS) to purchase and buy a combined total of
681,733,000 shares of stock of the Belle Corporation in the
aggregate gross value of One Billion Eight Hundred Forty-
Seven Million Five Hundred Seventy Eight Thousand Pesos
and Fifty Centavos(P1,847,578,057.50), for the purpose of
collecting for his personal gain and benefit, as in fact he did
collect and receive the sum of ONE HUNDRED EIGHTY
NINE MILLION SEVEN HUNDRED THOUSAND FIFTY
SEVEN PESOS (P189,700,000.00) as commission for said
stock purchase; and
(d) by unjustly enriching himself in the amount of THREE
BILLION TWO HUNDRED THIRTY THREE MILLION ONE
HUNDRED FOUR THOUSAND ONE HUNDRED SEVENTY
THREE PESOS AND SEVENTEEN CENTAVOS
(P3,233,104,173.17) comprising his unexplained wealth
acquired, accumulated and amassed by him under his
account name "Jose Velarde" with Equitable PCI Bank:
to the damage and prejudice of the Filipino people and the Republic of
the Philippines.
CONTRARY TO LAW.4
On April 16 and 17, 2001, the Ombudsman filed an Ex-Parte
Manifestation to Withdraw Information in Criminal Case Nos. 26559,
26560, 26561, 26562 and 26563. Petitioner registered his objection to
the Ombudsman’s motion to withdraw. The divisions of the
Sandiganbayan to which said cases were assigned granted the
withdrawal of the informations, save for that in Criminal Case No.
26561. At present, the Order of the First Division of the Sandiganbayan
denying the Ombudsman’s motion to withdraw in Criminal Case No.
26561 is still under reconsideration.
In Criminal Case No. 26558, petitioner filed on April 11, 2001 an
Omnibus Motion for the remand of the case to the Office of the
Ombudsman for: (1) the conduct of a preliminary investigation as
regards specification "d" of the accusations in the information in said
case; and (2) reconsideration/reinvestigation of the offenses in
specifications "a," "b" and "c" to enable petitioner to file his counter-
affidavits as well as other necessary documents.
On April 25, 2001, the Third Division of the Sandiganbayan issued a
Resolution finding that:
(p)robable cause for the offense of PLUNDER exists to justify issuance
of warrants of arrest of accused former President Joseph Ejercito
Estrada, Mayor Jose "Jinggoy" Estrada, Charlie "Atong" Ang, Edward
Serapio, Yolanda T. Ricaforte, Alma Alfaro, John Doe a.k.a Eleuterio
Tan or Eleuterio Ramon Tan or Mr. Uy and Jane Doe a.k.a. Delia
Rajas.
Subsequently, on May 31, 2001, the Third Division of the
Sandiganbayan issued a Resolution denying petitioner’s Omnibus
Motion.
On June 15, 2001, petitioner filed a Motion for Reconsideration of said
Resolution but the same was denied in a Resolution of June 25, 2001.
Meanwhile, on June 14, 2001, petitioner filed a Motion to Quash the
information in Criminal Case No. 26558, invoking the following grounds:
(1) the facts charged do not constitute an indictable offense as R.A. No.
7080, the statute on which it is based, is unconstitutional; and (2) the
information charges more than one offense.
The People of the Philippines filed an Opposition thereto on June 21,
2001. Petitioner filed his Reply to the Opposition on June 28, 2001.
On July 9, 2001, the Third Division of the Sandiganbayan issued its
Resolution denying petitioner’s motion to quash.
Petitioner thus filed the instant petition for certiorari and prohibition,
claiming that the Sandiganbayan committed grave abuse of discretion
in denying his motion to quash the information in Criminal Case No.
26558. Petitioner argues that R.A. No. 7080 is unconstitutional on the
following grounds:
I. IT VIOLATES THE DUE PROCESS CLAUSE FOR ITS
VAGUENESS
II. IT VIOLATES THE CONSTITUTIONAL RIGHT OF THE
ACCUSED TO KNOW THE NATURE AND CAUSE OF THE
ACCUSATION AGAINST HIM
III. IT VIOLATES THE DUE PROCESS CLAUSE AND THE
CONSTITUTIONAL PRESUMPTION OF INNOCENCE BY
LOWERING THE QUANTUM OF EVIDENCE NECESSARY
FOR PROVING THE COMPONENT ELEMENTS OF
PLUNDER
IV. IT IS BEYOND THE CONSTITUTIONAL POWER OF THE
LEGISLATURE TO DELIMIT THE REASONABLE DOUBT
STANDARD AND TO ABOLISH THE ELEMENT OF MENS
REA IN MALA IN SE CRIMES BY CONVERTING THESE TO
MALA PROHIBITA, IN VIOLATION OF THE DUE PROCESS
CONCEPT OF CRIMINAL RESPONSIBILITY.5
The provisions of law involved
Section 2 of R.A. No. 7080 provides:
Definition of the Crime of Plunder; Penalties. - Any public officer who,
by himself or in connivance with members of his family, relatives by
affinity or consanguinity, business associates, subordinates or other
persons, amasses, accumulates or acquires ill-gotten wealth through a
combination or series of overt or criminal acts as described in Section
1(d) hereof in the aggregate amount or total value of at least Fifty
million pesos (P50,000,000.00) shall be guilty of the crime of plunder
and shall be punished by reclusion perpetua to death. Any person who
participated with the said public officer in the commission of an offense
contributing to the crime of plunder shall likewise be punished for such
offense. In the imposition of penalties, the degree of participation and
the attendance of mitigating and extenuating circumstances, as
provided by the Revised Penal Code, shall be considered by the court.
The court shall declare any and all ill-gotten wealth and their interests
and other incomes and assets including the properties and shares of
stocks derived from the deposit or investment thereof forfeited in favor
of the State. (As amended by Sec. 12, RA No. 7659.)
Section 1(d) of the same law defines "ill-gotten wealth" as "any asset,
property, business enterprise or material possession of any person
within the purview of Section Two (2)" hereof, acquired by him directly
or indirectly through dummies, nominees, agents, subordinates, and/or
business associates by any combination or series of the following
means or similar schemes:
1. Through misappropriation, conversion, misuse or
malversation of public funds or raids on the public treasury;
2. By receiving, directly or indirectly, any commission, gift,
share, percentage, kickbacks or any other form of pecuniary
benefit from any person and/or entity in connection with any
government contract or project or by reason of the office or
position of the public officer concerned;
3. By the illegal or fraudulent conveyance or disposition of
assets belonging to the National Government or any of its
 subdivisions, agencies or instrumentalities or government-
owned or controlled corporations and their subsidiaries;
4. By obtaining, receiving or accepting directly or indirectly
any shares of stock, equity or any other form of interest or
participation including the promise of future employment in
any business enterprise or undertaking;
5. By establishing agricultural, industrial or commercial
monopolies or other combination and/or implementation of
decrees and orders intended to benefit particular persons or
special interests; or
6. By taking undue advantage of official position, authority,
relationship, connection or influence to unjustly enrich himself
or themselves at the expense and to the damage and
prejudice of the Filipino people and the Republic of the
Philippines.6
On the other hand, Section 4 states:
Rule of Evidence - For purposes of establishing the crime of plunder, it
shall not be necessary to prove each and every criminal act done by
the accused in furtherance of the scheme or conspiracy to amass,
accumulate or acquire ill-gotten wealth, it being sufficient to establish
beyond reasonable doubt a pattern of overt or criminal acts indicative of
the overall unlawful scheme or conspiracy.
Petitioner’s theory
Petitioner asserts that R.A. No. 7080 is vague and overbroad on its
face, and suffers from structural deficiency and ambiguity.7 In sum, he
maintains that the law does not afford an ordinary person reasonable
notice that his actuation will constitute a criminal offense. More
particularly, petitioner argues that the terms "combination" and "series"
are not clearly defined, citing that in a number of cases, the United
States (U.S.) federal courts in deciding cases under the Racketeer
Influenced and Corrupt Organizations Act (RICO law), after which the
Plunder Law was patterned, have given different interpretations to
"series of acts or transactions."8 In addition, he terms "raid on the public
treasury," "receiving or accepting a gift," "commission," "kickbacks,"
"illegal or fraudulent conveyance or disposition of assets," "monopolies
or other combinations," "special interests," "taking undue advantage of
official position," "unjustly enrich" all suffer from overbreadth which is a
form of vagueness.9
In arguing that the law on plunder is vague and impermissibly broad,
petitioner points out that the terms "combination" and ‘series" used in
the phrase "any combination or series of the following means or similar
schemes" are not defined under the statute. The use of these terms in
the law allegedly raises several questions as to their meaning and
import.
Petitioner posits the following queries: "Does it (referring to the term
"series") mean two, three, four, of the overt or criminal acts listed in
Section 1(d)? Would it mean two or more related enterprises falling
under at least two of the means or ‘similar schemes’ listed in the
law, or just a joint criminal enterprise? Would it require substantial
identity of facts and participants, or merely a common pattern of
action? Would it imply close connection between acts, or a direct
relationship between the charges? Does the term mean a factual
relationship between acts or merely a common plan among
conspirators?"10
The term "combination" is allegedly equally equivocal. According to
petitioner, it is not clear from the law if said term covers time, place,
manner of commission, or the principal characters. Thus petitioner
asks: "Does it (referring to the term "combination") include any two or
more acts, whether legal or illegal, or does the law require that the
combination must include at least two of the ‘means or similar
schemes’ laid down in R.A. 7080? Does it cover transactions that have
occurred in the same place or area, or in different places, no matter
how far apart? Does ‘combination’ include any two or more overt acts,
no matter how far apart in time, or does it contemplate acts
committed within a short period of time? Does the ‘combination’
cover the modus operandi of the crimes, or merely the evidence to
be used at the trial?"11
It is also argued that the phrase "pattern of overt or criminal acts
indicative of the overall scheme or conspiracy" adds to the vagueness
of the law because "pattern" is not defined therein and is not included in
the definition of the crime of plunder even though it is an essential
element of said crime.12
Petitioner also maintains that the Plunder Law violates the due process
clause and the constitutional presumption of innocence by lowering the
quantum of evidence necessary for proving the component elements of
plunder because Section 4 does not require that each and every
criminal act done by the accused in furtherance of the scheme or
conspiracy be proved, "it being sufficient to establish beyond
reasonable doubt a pattern of overt or criminal acts indicative of the
overall unlawful scheme or conspiracy."13
Finally, petitioner alleges that it is beyond the power of Congress to
delimit the reasonable doubt standard and to abolish the element of
mens rea in mala in se crimes by converting these to mala prohibita,
thereby making it easier for the prosecution to prove malversation,
bribery, estafa and other crimes committed by public officers since
criminal intent need not be established.14
Considering the infringement to the constitutionally-guaranteed right to
due process of an accused, petitioner contends that R.A. No. 7080
cannot be accorded any presumption of constitutional validity.
Respondents’ theory
On the other hand, Respondents argue that the "particular elements
constituting the crime of plunder" are stated with "definiteness and
certainty," as follows:
(1) There is a public officer who acts by himself or in
connivance with members of his family, relatives by affinity or
consanguinity, business associates, subordinates or other
persons;
(2) There is an amassing, accumulating or acquiring of ill-
gotten wealth;
(3) The total amount of ill-gotten wealth so amassed,
accumulated or acquired is at least Fifty Million Pesos
(P50,000,000.00); and
(4) The ill-gotten wealth, which is defined as any asset,
property, business enterprise or material possession of any
person within the purview of Section Two (2) of R.A. No.
7080, was acquired by him directly or indirectly through
dummies, nominees, agents, subordinates, and/or business
associates by any combination or series of the means or
similar schemes enumerated in Section 1(d). 15
Moreover, Respondents maintain that assuming that there is some
vagueness in the law, it need not be declared unconstitutional but may
be clarified by judicial construction. 16 Respondents further add that the
ordinary import of the terms combination" and "series" should prevail,
as can be gleaned from the deliberations of the Congress in the course
of its passage of the law. According to respondents, "series of overt
criminal acts" simply mean a repetition of at least two of any of those
enumerated acts found in Section 1(d) of R.A. 7080. And "combination"
means a product of combining of at least one of any of those
enumerated acts described in Section 1(d) with at least one of any of
the other acts so enumerated. Respondents score petitioner for arguing
on the basis of federal courts’ decisions on the RICO law, citing that the
U.S. courts have consistently rejected the contention that said law is
void for being vague.17
Respondents deny that the Plunder Law dispenses with the
requirement of proof beyond reasonable doubt. While there may be no
necessity to prove each and every other act done by the accused in
furtherance of the scheme to acquire ill-gotten wealth, it is still
necessary for the prosecution to prove beyond reasonable doubt the
pattern of overt or criminal acts indicative of the overall scheme or
conspiracy, as well as all the other elements of the offense of plunder. 18
Respondents also point out that conspiracy itself is not punishable
under the Plunder Law, which deals with conspiracy as a means of
incurring criminal liability.19
Respondents likewise contend that it is within the inherent powers and
wisdom of the legislature to determine which acts are mala prohibita in
the same way that it can declare punishable an act which is inherently
not criminal in nature.20
In conclusion, Respondents assert that petitioner has failed to
overcome the presumption of constitutionality of R.A. No. 7080.
Petitioner’s Reply
Petitioner, in his Reply to Comment, draws attention to Section 4,
arguing that the provision states the "most important element, which is
the common thread that ties the component acts together: "a pattern of
overt or criminal acts indicative of the overall unlawful scheme or
conspiracy21 and raises the following questions:
(a) Reference is made to a "pattern of overt or criminal acts."
The disjunctive "or" is used. Will a pattern of acts, which
are overt but not criminal in themselves, be indicative of an
overall unlawful scheme or conspiracy?
(b) Under what specific facts or circumstances will a "pattern"
be "indicative" of the overall unlawful scheme or conspiracy?
(c) Under what specific facts or circumstances will the
required "pattern" or "scheme" even be said to be present or
to exist?
(d) When is there an "unlawful scheme or conspiracy?"22
Issues raised in the oral arguments
Oral arguments were heard on September 18, 2001. At said hearing,
the Court defined the issues for resolution as follows:
1.) WHETHER R.A. NO. 7080 IS UNCONSTITUTIONAL FOR
BEING VAGUE;
2) WHETHER R.A. NO. 7080 REQUIRES LESS EVIDENCE
FOR PROVING THE PREDICATE CRIMES OF PLUNDER
AND THEREFORE VIOLATES THE RIGHT OF THE
ACCUSED TO DUE PROCESS; and
3) WHETHER PLUNDER AS DEFINED IN R.A. NO. 7080 IS
A MALUM PROHIBITUM AND IF SO, WHETHER IT IS
 WITHIN THE POWER OF CONGRESS TO SO CLASSIFY
THE SAME.23
Thereafter, both parties filed their respective memoranda in which they
discussed the points which they raised in their earlier pleadings and
during the hearing.
I believe that there is merit in the petition.
A penal statute which violates constitutional
guarantees of individual rights is void.
Every law enacted by Congress enjoys a presumption of
constitutionality,24 and the presumption prevails in the absence of
contrary evidence.25 A criminal statute is generally valid if it does not
violate constitutional guarantees of individual rights.26 Conversely,
when a constitutionally protected right of an individual is in
danger of being trampled upon by a criminal statute, such law
must be struck down for being void.27
One of the fundamental requirements imposed by the Constitution upon
criminal statutes is that pertaining to clarity and definiteness. Statutes,
particularly penal laws, that fall short of this requirement have been
declared unconstitutional for being vague. This "void-for-vagueness"
doctrine is rooted in the basic concept of fairness as well as the due
process clause of the Constitution.
The Constitution guarantees both substantive and procedural due
process28 as well as the right of the accused to be informed of the
nature and cause of the accusation against him. 29 A criminal statute
should not be so vague and uncertain that "men of common intelligence
must necessarily guess as to its meaning and differ as to its
application.30
There are three distinct considerations for the vagueness doctrine.
First, the doctrine is designed to ensure that individuals are properly
warned ex ante of the criminal consequences of their conduct. This "fair
notice" rationale was articulated in United States v. Harriss:31
The constitutional requirement of definiteness is violated by a criminal
statute that fails to give a person of ordinary intelligence fair notice that
his contemplated conduct is forbidden by the statute. The underlying
principle is that no man shall be held criminally responsible for conduct
which he could not reasonably understand to be proscribed. 32
Second, and viewed as more important, the doctrine is intended to
prevent arbitrary and discriminatory law enforcement. 33 Vague laws
are invariably "standardless" and as such, they afford too great an
opportunity for criminal enforcement to be left to the unfettered
discretion of police officers and prosecutors. 34 Third, vague laws fail to
provide sufficient guidance to judges who are charged with interpreting
statutes. Where a statute is too vague to provide sufficient guidance,
the judiciary is arguably placed in the position of usurping the proper
function of the legislature by "making the law" rather than interpreting
it.35
While the dictum that laws be clear and definite does not require
Congress to spell out with mathematical certainty the standards to
which an individual must conform his conduct, 36 it is necessary that
statutes provide reasonable standards to guide prospective conduct. 37
And where a statute imposes criminal sanctions, the standard of
certainty is higher.38 The penalty imposable on the person found guilty
of violating R.A. No. 7080 is reclusion perpetua to death.39 Given such
penalty, the standard of clarity and definiteness required of R.A. No.
7080 is unarguably higher than that of other laws.40
Void-for-vagueness doctrine
applies to criminal laws.
A view has been proffered that "vagueness and overbreadth doctrines
are not applicable to penal laws."41 These two concepts, while related,
are distinct from each other. 42 On one hand, the doctrine of overbreadth
applies generally to statutes that infringe upon freedom of speech. 43 On
the other hand, the "void-for-vagueness" doctrine applies to criminal
laws, not merely those that regulate speech or other fundamental
constitutional rights.44 The fact that a particular criminal statute does not
infringe upon free speech does not mean that a facial challenge to the
statute on vagueness grounds cannot succeed.45
As earlier intimated, the "vagueness doctrine" is anchored on the
constitutionally-enshrined right to due process of law. Thus, as in this
case that the "life, liberty and property" of petitioner is involved, the
Court should not hesitate to look into whether a criminal statute has
sufficiently complied with the elementary requirements of definiteness
and clarity. It is an erroneous argument that the Court cannot apply the
vagueness doctrine to penal laws. Such stance is tantamount to
saying that no criminal law can be challenged however repugnant
it is to the constitutional right to due process.
While admittedly, penal statutes are worded in reasonably general
terms to accomplish the legislature’s objective of protecting the public
from socially harmful conduct, this should not prevent a vagueness
challenge in cases where a penal statute is so indeterminate as to
cause the average person to guess at its meaning and application. For
if a statute infringing upon freedom of speech may be challenged for
being vague because such right is considered as fundamental, with
more reason should a vagueness challenge with respect to a penal
statute be allowed since the latter involve deprivation of liberty, and
even of life which, inarguably, are rights as important as, if not more
than, free speech.
It has been incorrectly suggested 46 that petitioner cannot mount a
"facial challenge" to the Plunder Law, and that "facial" or "on its face"
challenges seek the total invalidation of a statute. 47 Citing Broadrick v.
Oklahoma,48 it is also opined that "claims of facial overbreadth have
been entertained in cases involving statutes which, by their terms, seek
to regulate only spoken words" and that "overbreadth claims, if
entertained at all, have been curtailed when invoked against ordinary
criminal laws that are sought to be applied to protected conduct." For
this reason, it is argued further that "on its face invalidation of statutes
has been described as ‘manifestly strong medicine,’ to be employed
‘sparingly and only as a last resort.’" A reading of Broadrick, however,
shows that the doctrine involved therein was the doctrine of
overbreadth. Its application to the present case is thus doubtful
considering that the thrust at hand is to determine whether the Plunder
Law can survive the vagueness challenge mounted by petitioner. A
noted authority on constitutional law, Professor Lockhart, explained that
"the Court will resolve them (vagueness challenges) in ways different
from the approaches it has fashioned in the law of overbreadth." 49 Thus,
in at least two cases,50 the U.S. courts allowed the facial challenges to
vague criminal statutes even if these did not implicate free speech
In Kolender v. Lawson,51 petitioners assailed the constitutionality of a
California criminal statute which required persons who loiter or wander
on the streets to provide a credible and reasonable identification and to
account for their presence when requested by a peace officer under
circumstances that would justify a valid stop. The U.S. Supreme Court
held that said statute was unconstitutionally vague on its face within the
meaning of the due process clause of the Fourteenth Amendment
because it encourages arbitrary enforcement by failing to clarify what is
contemplated by the requirement that a suspect provide a "credible and
reasonable identification." Springfield vs. Oklahoma52 on the other hand
involved a challenge to a Columbus city ordinance banning certain
assault weapons. The court therein stated that a criminal statute may
be facially invalid even if it has some conceivable application. It went on
to rule that the assailed ordinance’s definition of "assault weapon" was
unconstitutionally vague, because it was "fundamentally irrational and
impossible to apply consistently by the buying public, the sportsman,
the law enforcement officer, the prosecutor or the judge." 53
It is incorrect to state that petitioner has made "little effort to show the
alleged invalidity of the statute as applied to him, as he allegedly
"attacks ‘on their face’ not only §§ 1(d)(1) and (2) of R.A. 7080 under
which he is charged, but also its other provisions which deal with
plunder committed by illegal or fraudulent disposition of government
assets (§1(d)(3)), acquisition of interest in business (§1(d)(4)), and
establishment of monopolies and combinations or implementation of
decrees intended to benefit particular persons or special interests (§
1(d)(5))."54 Notably, much of petitioner’s arguments dealt with the
vagueness of the key phrases "combination or series" and "pattern of
overt or criminal acts indicative of the overall unlawful scheme or
conspiracy" which go into the very nature of the crime for which he is
charged.
Taking into consideration that the Plunder Law is a penal statute that
imposes the supreme penalty of death, and that petitioner in this case
clearly has standing to question its validity inasmuch as he has been
charged thereunder and that he has been for sometime now painfully
deprived of his liberty, it behooves this Court to address the challenge
on the validity of R.A. No. 7080.
Men steeped in law find
difficulty in understanding plunder.
The basic question that arises, therefore, is whether the clauses in
Section 2--
combination or series of overt or criminal acts as described in Section
1(d) hereof
and Section 1(d), which provides--
x x x by any combination or series of the following means or similar
schemes:
1) Through misappropriation, conversion, misuse, or malversation of
public funds or raids on the public treasury;
xxx
6) By taking undue advantage of official position, authority, relationship,
connection or influence to unjustly enrich himself or themselves at the
expense and to the damage and prejudice of the Filipino people and
the Republic of the Philippines.
as qualified by Section 4 which also speaks of the "scheme or
conspiracy to amass, accumulate or acquire ill-gotten wealth" and of
"a pattern of overt or criminal acts indicative of the overall unlawful
scheme or conspiracy," are clear enough that a person "of common
intelligence" need not guess at their meaning and differ as to their
application.
The above raise several difficult questions of meaning which go to the
very essence of the offense, such as:
a. How many acts would constitute a "combination or series?"
 b. Must the acts alleged to constitute the "combination or
series" be similar in nature? Note that Section 1(d) speaks of
"similar schemes" while Section 4 speaks of "the scheme"
and of "a pattern of overt or criminal acts indicative of the
overall unlawful scheme or conspiracy."
c. Must the "combination or series" of "overt or criminal acts"
involving the aggregate amount of at least P50 million be
conceived as such a scheme or a "pattern of overt or criminal
acts" from inception by the accused?
d. What would constitute a "pattern"? What linkage must there
be between and among the acts to constitute a "pattern"?
Need there be a linkage as to the persons who conspire with
one another, and a linkage as to all the acts between and
among them?
e. When Section 4 speaks of "indicative of the overall unlawful
scheme or conspiracy," would this mean that the "scheme" or
"conspiracy" should have been conceived or decided upon in
its entirety, and by all of the participants?
f. When committed in connivance "with members of his family,
relatives by affinity or consanguinity, business associates,
subordinates or other persons" or through "dummies,
nominees, agents, subordinates and/or business associates",
would such fact be part of the "pattern of overt or criminal
acts" and of the "overall unlawful scheme or conspiracy"
such that all of those who are alleged to have participated in
the crime of plunder must have participated in each and every
act allegedly constituting the crime of plunder? And as in
conspiracy, conspired together from inception to commit the
offense?
g. Within what time frame must the acts be committed so as
to constitute a "combination or series"?
I respectfully disagree with the majority that "ascertainable standards
and well-defined parameters" are provided in the law 55 to resolve these
basic questions.
Even men steeped in the knowledge of the law are in a quandary as to
what constitutes plunder. The Presiding Justice of the Sandiganbayan,
Justice Francis Garchitorena, admitted that the justices of said court
"have been quarrelling with each other in finding ways to
determine what [they] understand by plunder."56 Senator Neptali
Gonzales also noted during the deliberations of Senate Bill No. 733 that
the definition of plunder under the law is vague. He bluntly
declared: "I am afraid that it might be faulted for being violative of the
due process clause and the right to be informed of the nature and
cause of the accusation of an accused. 57 Fr. Bernas, for his part,
pointed to several problematical portions of the law that were left
unclarified. He posed the question: "How can you have a 'series' of
criminal acts if the elements that are supposed to constitute the
series are not proved to be criminal?"58
The meanings of "combination" and "series"
as used in R.A. No. 7080 are not clear.
Although the law has no statutory definition of "combination" or "series",
the majority is of the view that resort can be had to the ordinary
meaning of these terms. Thus, Webster's Third New International
Dictionary gives the meaning of "combination": "the result or product
or product of combining: a union or aggregate made of combining one
thing with another."59
In the context of R.A. No. 7080, "combination" as suggested by the
Solicitor General means that at least two of the enumerated acts found
in Section 1(d), i.e., one of any of the enumerated acts, combined with
another act falling under any other of the enumerated means may
constitute the crime of plunder. With respect to the term "series," the
majority states that it has been understood as pertaining to "two or
more overt or criminal acts falling under the same category" 60 as
gleaned from the deliberations on the law in the House of
Representatives and the Senate.
Further, the import of "combination" or "series" can be ascertained, the
majority insists,61 from the following deliberations in the Bicameral
Conference Committee on May 7, 1991:
REP. ISIDRO: I am just intrigued again by our definition of plunder. We
say, THROUGH A COMBINATION OR SERIES OF OVERT OR
CRIMINAL ACTS AS MENTIONED IN SECTION ONE HEREOF. Now
when we say combination, we actually mean to say, if there are two or
more means, we mean to say that number one and two or number one
and something else are included, how about a series of the same act?
For example, through misappropriation, conversion, misuse, will these
be included also?
THE CHAIRMAN (REP. GARCIA): Yeah, because we say series.
REP. ISIDRO: Series.
THE CHAIRMAN (REP. GARCIA): Yeah, we include series.
REP. ISIDRO: But we say we begin with a combination.
THE CHAIRMAN: (REP. GARCIA): Yes.
REP. ISIDRO: When we say combination, it seems that-
THE CHAIRMAN (REP. GARCIA): Two.
REP. ISIDRO: Not only two but we seem to mean that two of the
enumerated means not twice of one enumeration.
THE CHAIRMAN: (REP. GARCIA): No, no, not twice.
REP. ISIDRO: Not twice?
THE CHAIRMAN (REP. GARCIA): Yes. Combination is not twice—but
combination, two acts.
REP. ISIDRO: So in other words, that’s it. When we say combination,
we mean two different acts. It can not be a repetition of the same act.
THE CHAIRMAN (REP. GARCIA): That be referred to series. Yeah.
REP. ISIDRO: No, no. Supposing one act is repeated, so there are two.
THE CHAIRMAN (REP. GARCIA): A series.
REP. ISIDRO: That’s not series. It’s a combination. Because when we
say combination or series, we seem to say that two or more, ‘di ba?
THE CHAIRMAN: (REP. GARCIA): Yes, This distinguishes it, really,
from the ordinary crimes. That is why, I said, that is a very good
suggestion because if it is only one act, it may fall under ordinary crime
but we have here a combination or series of overt or criminal acts. So…
HON. ISIDRO: I know what you are talking about. For example, through
misappropriation, conversion, misuse or malversation of public funds
who raids the public treasury, now, for example, misappropriation, if
there are a series of misappropriations?
xxx
THE CHAIRMAN (REP. GARCIA): Series. One after the other eh di…
THE CHAIRMAN (SEN TAÑADA): So that would fall under term
"series"?
THE CHAIRMAN (REP. GARCIA): Series, oo.
REP. ISIDRO: Now, if it is combination, ano, two misappropriations…
THE CHAIRMAN (REP. GARCIA): It’s not… two misappropriations will
not be combination. Series.
REP. ISIDRO: So, it is not a combination?
THE CHAIRMAN (REP. GARCIA): Yes.
REP. ISIDRO: When you say "combination", two different?
THE CHAIRMAN (REP. GARCIA): Yes.
THE CHAIRMAN (SEN. TAÑADA): Two different.
REP. ISIDRO: Two different acts.
THE CHAIRMAN (REP. GARCIA): For example, ha…
REP. ISIDRO: Now a series, meaning, repetition…62
The following deliberations in the Senate are pointed to by the
majority63 to show that the words "combination" and "series" are given
their ordinary meaning:
Senator Maceda. In line of our interpellations that sometimes "one" or
maybe even "two" acts may already result in such a big amount, on line
25, would the Sponsor consider deleting the words "a series of overt
or". To read, therefore: "or conspiracy COMMITTED by criminal acts
such as". Remove the idea of necessitating "a series". Anyway, the
criminal acts are in the plural.
Senator Tañada. That would mean a combination of two or more of the
acts mentioned in this.
The President. Probably, two or more would be….
Senator Maceda. Yes, because ‘a series’ implies several or many’ two
or more.
Senator Tañada. Accepted, Mr. President.
xxx
The President. If there is only one, then he has to be prosecuted under
the particular crime. But when we say ‘acts of plunder’ there should be,
at least, two or more.
Senator Romulo. In other words, that is already covered by existing
laws, Mr. President.64
To my mind, resort to the dictionary meaning of the terms "combination"
and "series" as well as recourse to the deliberations of the lawmakers
only serve to prove that R.A. No. 7080 failed to satisfy the strict
requirements of the Constitution on clarity and definiteness. Note that
the key element to the crime of plunder is that the public officer, by
himself or in conspiracy with others, amasses, accumulates, or
acquires "ill-gotten wealth" through a "combination or series of overt or
criminal acts" as described in Section 1(d) of the law. Senator
Gonzales, during the deliberations in the Senate, already raised serious
concern over the lack of a statutory definition of what constitutes
"combination" or "series", consequently, expressing his fears that
Section 2 of R.A. No. 7080 might be violative of due process:
Senator Gonzales. To commit the offense of plunder, as defined in this
Act and while constituting a single offense, it must consist of a series of
overt or criminal acts, such as bribery, extortion, malversation of public
funds, swindling, illegal exaction, and graft or corrupt practices act and
like offenses. Now, Mr. President, I think, this provision, by itself will be
vague. I am afraid that it might be faulted for being violative of the due
process clause and the right to be informed of the nature and cause of
accusation of an accused. Because, what is meant by "series of overt
or criminal acts"? I mean, would 2, 3, 4 or 5 constitute a series? During
the period of amendments, can we establish a minimum of overt acts
like, for example, robbery in band? The law defines what is robbery in
band by the number of participants therein. In this particular case
probably, we can statutorily provide for the definition of "series" so that
two, for example, would that be already a series? Or, three, what would
be the basis for such determination?65 (Emphasis supplied.)
The point raised by Senator Gonzales is crucial and well-taken. I share
petitioner’s observation that when penal laws enacted by Congress
make reference to a term or concept requiring a quantitative definition,
these laws are so crafted as to specifically state the exact number or
percentage necessary to constitute the elements of a crime. To cite a
few:
"Band" – "Whenever more than three armed malefactors shall have
acted together in the commission of an offense, it shall be deemed to
have been committed by a band." (Article 14[6], Revised Penal Code) 66
"Conspiracy" – "A conspiracy exists when two or more persons come to
an agreement concerning the commission of a felony and decide to
commit it." (Article 8, Revised Penal Code)67
"Illegal Recruitment by a Syndicate" – "Illegal recruitment is deemed
committed by a syndicate if carried out by a group of three (3) or more
persons conspiring and/or confederating with one another in carrying
out any unlawful or illegal transaction, enterprise or scheme x x x."
(Section 38, Labor Code)
"Large-scale Illegal Recruitment" – "Illegal recruitment is deemed
committed in large scale if committed against three (3) or more persons
individually or as a group." (Section 38, Labor Code)
"Organized/Syndicated Crime Group" – "[M]eans a group of two or
more persons collaborating, confederating or mutually helping one
another for purposes of gain in the commission of any crime." (Article
62 (1)(1a), Revised Penal Code)68
"Swindling by a Syndicate" – "x x x if the swindling (estafa) is committed
by a syndicate consisting of five or more persons formed with the
intention of carrying out the unlawful or illegal act, transaction,
enterprise or scheme x x x ." (Section 1, P.D. No. 1689) 69
The deliberations of the Bicameral Conference Committee and of the
Senate cited by the majority, consisting mostly of unfinished sentences,
offer very little help in clarifying the nebulous concept of plunder. All
that they indicate is that Congress seemingly intended to hold liable for
plunder a person who: (1) commits at least two counts of any one of the
acts mentioned in Section 1(d) of R.A. No. 7080, in which case, such
person commits plunder by a series of overt criminal acts; or (2)
commits at least one count of at least two of the acts mentioned in
Section 1(d), in which case, such person commits plunder by a
combination of overt criminal acts. Said discussions hardly provide a
window as to the exact nature of this crime.
A closer look at the exchange between Representatives Garcia and
Isidro and Senator Tañada would imply that initially, combination was
intended to mean "two or more means,"70 i.e., "number one and two or
number one and something else x x x,"71 "two of the enumerated means
not twice of one enumeration," 72 "two different acts."73 Series would
refer to "a repetition of the same act."74 However, the distinction was
again lost as can be gleaned from the following:
THE CHAIRMAN (REP. GARCIA) Yes. Combination is not twice – but
combination, two acts.
REP. ISIDRO. So in other words, that’s it. When we say combination,
we mean, two different acts. It can not be a repetition of the same act.
THE CHAIRMAN (REP. GARCIA). That be referred to series. Yeah.
REP. ISIDRO. No, no. Supposing one act is repeated, so there are two.
THE CHAIRMAN (REP. GARCIA). A series.
REP. ISIDRO. That’s not series. It’s a combination. Because when we
say combination or series, we seem to say that two or more, ‘di ba?
THE CHAIRMAN (REP. GARCIA). Yes. This distinguishes it really the
ordinary --- That’s why I said, that’s a very good suggestion, because if
its’ only one act, it may fall under ordinary crime. But we have here a
combination or series, of overt or criminal acts" (Emphasis supplied). 75
xxx
THE CHAIRMAN (REP. GARCIA P.) Series. One after the other eh di…
THE CHAIRMAN (SEN. TAÑADA) So, that would fall under the term
"series"?
THE CHAIRMAN (REP. GARCIA P) Series, oo.
REP. ISIDRO. Now, if it is combination, ano, two misappropriations…
THE CHAIRMAN (REP. GARCIA) It’s not… two misappropriations will
not be combination. Series.
REP. ISIDRO. So, it is not a combination?
THE CHAIRMAN. (REP. GARCIA P.) Yes.
REP. ISIDRO. When we say "combination", two different?
THE CHAIRMAN (REP. GARCIA P.) Yes.
THE CHAIRMAN (SEN. TAÑADA) Two different.
REP. ISIDRO. Two different acts.
THE CHAIRMAN (REP. GARCIA P.) For example, ha…
REP. ISIDRO. Now a series, meaning, repetition…
THE CHAIRMAN (SEN. TAÑADA) Yes.
REP. ISIDRO. With that…
THE CHAIRMAN (REP. GARCIA P.) Thank you.
THE CHAIRMAN (SEN. TAÑADA) So, it could be a series of any of the
acts mentioned in paragraphs 1, 3, 4, 5 of Section 2 (d), or… 1 (d)
rather, or a combination of any of the acts mentioned in paragraph 1
alone, or paragraph 2 alone or paragraph 3 or paragraph 4.
THE CHAIRMAN (REP. GARCIA P.) I think combination maybe…which
one? Series?
THE CHAIRMAN (SEN. TAÑADA) Series or combination.
REP. ISIDRO. Which one, combination or series or series or
combination?
THE CHAIRMAN (SEN. TAÑADA) Okay. Ngayon doon sa definition,
ano, Section 2, definition, doon sa portion ng… Saan iyon? As
mentioned, as described…
THE CHAIRMAN (REP. GARCIA P.) Described. I think that is…
THE CHAIRMAN (SEN. TAÑADA) … better than "mentioned". Yes.
THE CHAIRMAN (REP. GARCIA P.) Okay?
REP. ISIDRO. Very good.
THE CHAIRMAN. (SEN. TAÑADA) Oo, marami pong salamat.
THE CHAIRMAN (REP. GARCIA P.) Maraming salamat po.
The meeting was adjourned at 1:33 p.m."76 (Emphasis supplied.)
The aforequoted deliberations, especially the latter part thereof, would
show a dearth of focus to render precise the definition of the terms.
Phrases were uttered but were left unfinished. The examples cited were
not very definite. Unfortunately, the deliberations were apparently
adjourned without the Committee members themselves being clear on
the concept of series and combination.
Moreover, if "combination" as used in the law simply refers to the
amassing, accumulation and acquisition of ill-gotten wealth amounting
to at least P50 Million through at least two of the means enumerated in
Section 1(d), and "series," to at least two counts of one of the modes
under said section, the accused could be meted out the death penalty
for acts which, if taken separately, i.e., not considered as part of the
combination or series, would ordinarily result in the imposition of
correctional penalties only. If such interpretation would be adopted, the
Plunder law would be so oppressive and arbitrary as to violate due
process and the constitutional guarantees against cruel or inhuman
punishment.77 The penalty would be blatantly disproportionate to the
offense. Petitioner’s examples illustrate this absurdity:
a. One act of indirect bribery (penalized under Art. 211 of the Revised
Penal Code with prision correccional in its medium and maximum
periods),
combined with -
one act of fraud against the public treasury (penalized under Art. 213 of
the Revised Penal Code with prision correccional in its medium period
to prision mayor in its minimum period).
equals –
Plunder (punished by reclusion perpetua to death plus forfeiture of
assets under R. A. 7080)
b. One act of prohibited transaction (penalized under Art. 215 of the
Revised Penal Code with prision correccional in its minimum period or
a fine ranging from P200 to P1,000 or both).
combined with –
one act of establishing a commercial monopoly (penalized under Art.
186 of Revised Penal Code with prision correccional in its minimum or
a fine ranging from P200 to P6,00, or both.
equals –
Plunder (punished by reclusion perpetua to death, and forfeiture of
assets under R.A. 7080).
c. One act of possession of prohibited interest by a public officer
(penalized with prision correccional in its minimum period or a fine of
P200 to P1,000, or both under Art. 216 of the Revised Penal Code).
combined with –
one act of combination or conspiracy in restraint of trade (penalized
under Art. 186 of the Revised Penal Code with prision correccional in
its minimum period, or a fine of P200 to P1,000, or both),
equals –
plunder (punished by reclusion perpetua to death, and forfeiture of
assets).78
The argument that higher penalties may be imposed where two or more
distinct criminal acts are combined and are regarded as special
complex crimes, i.e., rape with homicide, does not justify the imposition
of the penalty of reclusion perpetua to death in case plunder is
committed. Taken singly, rape is punishable by reclusion perpetua;79
and homicide, by reclusion temporal. 80 Hence, the increase in the
penalty imposed when these two are considered together as a special
complex crime is not too far from the penalties imposed for each of the
single offenses. In contrast, as shown by the examples above, there
are instances where the component crimes of plunder, if taken
separately, would result in the imposition of correctional penalties only;
but when considered as forming part of a series or combination of acts
constituting plunder, could be punishable by reclusion perpetua to
death. The disproportionate increase in the penalty is certainly violative
of substantive due process and constitute a cruel and inhuman
punishment.
It may also be pointed out that the definition of "ill-gotten wealth" in
Section 1(d) has reference to the acquisition of property (by the
accused himself or in connivance with others) "by any combination or
series" of the "means" or "similar schemes" enumerated therein, which
include the following:
xxx
4. By obtaining, receiving or accepting directly or indirectly any shares
of stock, equity or any other forms of interest or participation including
the promise of future employment or any business enterprise or
undertakings;
5. By establishing agricultural, industrial or commercial monopolies or
other combination and/or implementation of decrees and orders
intended to benefit particular persons or special interests;
xxx
The above-mentioned acts are not, by any stretch of the imagination,
criminal or illegal acts. They involve the exercise of the right to liberty
and property guaranteed by Article III, Section 1 of the Constitution
which provides that "No person shall be deprived of life, liberty or
property without due process of law, nor shall any person be denied the
equal protection of the laws." Receiving or accepting any shares of
stock is not per se objectionable. It is in pursuance of civil liberty, which
includes "the right of the citizen to be free to use his faculties in all
lawful ways; x x x to earn his livelihood by any lawful calling; to pursue
any avocation, and/or that purpose, to enter into all contracts which
may be proper, necessary and essential to his carrying out these
purposes to a successful conclusion.81 Nor is there any impropriety,
immorality or illegality in establishing agricultural, industrial or
commercial monopolies or other combination and/or implementation of
decrees and orders even if they are intended to benefit particular
persons or special interests. The phrases "particular persons" and
"special interests" may well refer to the poor, 82 the indigenous cultural
communities,83 labor,84 farmers,85 fisherfolk,86 women,87 or those
connected with education, science and technology, arts, culture and
sports.88
In contrast, the monopolies and combinations described in Article 186
of the Revised Penal Code are punishable because, as specifically
defined therein, they are "on restraint of trade or commerce or to
prevent by artificial means of free competition in the market, or the
object is "to alter the price" of any merchandise "by spreading false
rumors," or to manipulate market prices in restraint of trade. There are
no similar elements of monopolies or combinations as described in the
Plunder Law to make the acts wrongful.
If, as interpreted by the Solicitor General, "series" means a "repetition"
or pertains to "two or more" acts, and "combination as defined in the
Webster’s Third New International Dictionary is "the result or product of
combining one thing with another," 89 then, the commission of two or
more acts falling under paragraphs (4) and (5) of Section 1(d) would
make innocent acts protected by the Constitution as criminal, and
punishable by reclusion perpetua to death.
R.A. No. 7080 does not define "pattern,"
an essential element of the crime of plunder.
Granting arguendo that, as asserted by the majority, "combination" and
"series" simplistically mean the commission of two or more of the acts
enumerated in Section 1(d),90 still, this interpretation does not cure the
vagueness of R.A. No. 7080. In construing the definition of "plunder,"
Section 2 of R.A. No. 7080 must not be read in isolation but rather,
must be interpreted in relation to the other provisions of said law. It is a
basic rule of statutory construction that to ascertain the meaning of a
law, the same must be read in its entirety. 91 Section 1 taken in relation
to Section 4 suggests that there is something to plunder beyond simply
the number of acts involved and that a grand scheme to amass,
accumulate or acquire ill-gotten wealth is contemplated by R.A. No.
7080. Sections 1 and 2 pertain only to the nature and quantitative
means or acts by which a public officer, by himself or in connivance
with other persons, "amasses, accumulates or acquires ill-gotten
wealth." Section 4, on the other hand, requires the presence of
elements other than those enumerated in Section 2 to establish that the
crime of plunder has been committed because it speaks of the
necessity to establish beyond reasonable doubt a "pattern of overt or
criminal acts indicative of the overall unlawful scheme or conspiracy."
Clearly, it will not suffice that the "illegal wealth" amassed is at least
Fifty Million Pesos and that this was acquired by any two or more of the
acts described in Section 1(d); it is necessary that these acts constitute
a "combination or series" of acts done in furtherance of "the scheme or
conspiracy to amass, accumulate or acquire ill-gotten wealth", and
which constitute "a pattern of overt or criminal acts indicative of the
overall scheme or conspiracy."
That pattern is an essential element of the crime of plunder is evident
from a reading of the assailed law in its entirety. It is that which would
distinguish plunder from isolated criminal acts punishable under the
Revised Penal Code and other laws, for without the existence a
"pattern of overt or criminal acts indicative of the overall scheme or
conspiracy" to acquire ill-gotten wealth, a person committing several or
even all of the acts enumerated in Section 1(d) cannot be convicted for
plunder, but may be convicted only for the specific crimes committed
under the pertinent provisions of the Revised Penal Code or other laws.
For this reason, I do not agree that Section 4 is merely a rule of
evidence or a rule of procedure. It does not become such simply
because its caption states that it is, although its wording indicates
otherwise. On the contrary, it is of substantive character because it
spells out a distinctive element of the crime which has to be
established, i.e., an overall unlawful "scheme or conspiracy" indicated
by a "pattern of overt or criminal acts" or means or similar schemes "to
amass, accumulate or acquire ill-gotten wealth."
The meaning of the phrase "pattern of overt or criminal acts indicative
of the overall unlawful scheme or conspiracy," however, escapes me.
As in "combination" and "series," R.A. No. 7080 does not provide a
definition of "pattern" as well as "overall unlawful scheme." Reference
to the legislative history of R.A. No. 7080 for guidance as to the
meanings of these concepts would be unavailing, since the records of
the deliberations in Congress are silent as to what the lawmakers mean
by these terms.
Resort to the dictionary meanings of "pattern" and "scheme" is, in this
case, wholly inadequate. These words are defined as:
pattern: an arrangement or order of things or activity. 92
scheme: design; project; plot.93
At most, what the use of these terms signifies is that while multiplicity of
the acts (at least two or more) is necessary, this is not sufficient to
constitute plunder. As stated earlier, without the element of "pattern"
indicative of an "overall unlawful scheme," the acts merely constitute
isolated or disconnected criminal offenses punishable by the Revised
Penal Code or other special laws.
The commission of two or more of the acts falling under Section 1(d) is
no guarantee that they fall into a "pattern" or "any arrangement or
order." It is not the number of acts but the relationship that they bear to
each other or to some external organizing principle that renders them
"ordered" or "arranged":
A pattern is an arrangement or order of things, or activity, and the mere
fact that there are a number of predicates is no guarantee that they fall
into an arrangement or order. It is not the number of predicates but the
relationship that they bear to each other or to some external organizing
principle that renders them ‘ordered’ or ‘arranged.’ 94
In any event, it is hardly possible that two predicate acts can form a
pattern:
The implication is that while two acts are necessary, they may not be
sufficient. Indeed, in common parlance, two of anything will not
generally form a ‘pattern.’95
In H. J. Inc. v. Northwestern Bell Telephone Co. et al. 96 (hereinafter
referred to as Northwestern), the U.S. Court reiterated the foregoing
doctrine:
xxx Nor can we agree with those courts that have suggested that a
pattern is established merely by proving two predicate acts. 97
Respondents’ metaphorical illustration of "pattern" as a wheel with
spokes (the overt or criminal acts of the accused) meeting at a common
center (the acquisition of ill-gotten wealth) and with a rim (the overall
unlawful scheme or conspiracy) of the wheel enclosing the spokes, is
off tangent. Their position that two spokes suffice to make a wheel,
even without regard to the relationship the spokes bear to each other
clearly demonstrates the absurdity of their view, for how can a wheel
with only two spokes which are disjointed function properly?
That "pattern" is an amorphous concept even in U.S. jurisprudence
where the term is reasonably defined is precisely the point of the
incisive concurring opinion of Justice Antonin Scalia in Northwestern
where he invited a constitutional challenge to the RICO law on "void-
for-vagueness" ground.98 The RICO law is a federal statute in the
United States that provides for both civil and criminal penalties for
violation therefor. It incorporates by reference twenty-four separate
federal crimes and eight types of state felonies. 99 One of the key
elements of a RICO violation is that the offender is engaged in a
"pattern of racketeering activity."100 The RICO law defines the phrase
"pattern of racketeering activity" as requiring "at least two acts of
racketeering activity, one of which occurred after the effective date of
18 USCS § 1961, and within ten years (excluding any period of
imprisonment) after the commission of a prior act of racketeering
activity."101 Incidentally, the Solicitor General claims that R.A. No. 7080
is an entirely different law from the RICO law. The deliberations in
Congress reveal otherwise. As observed by Rep. Pablo Garcia,
Chairman of the House of Representatives Committee on Justice, R.A.
No. 7080 was patterned after the RICO law.102
In Northwestern, conceding that "[the U.S. Congress] has done
nothing . . . further to illuminate RICO’s key requirement of a pattern of
racketeering," the U.S. Supreme Court, through Justice William J.
Brennan, Jr., undertook the task of developing a meaningful concept of
"pattern" within the existing statutory framework.103 Relying heavily on
legislative history, the US Supreme Court in that case construed
"pattern" as requiring "continuity plus relationship." 104 The US Supreme
Court formulated the "relationship requirement" in this wise: "Criminal
conduct forms a pattern if it embraces criminal acts that have the same
or similar purposes, results, participants, victims, or methods of
commission, or otherwise are interrelated by distinguishing
characteristics and are not isolated events." 105 Continuity is clarified as
"both a closed and open-ended concept, referring either to a closed
period of repeated conduct, or to past conduct that by its nature
projects into the future with a threat of repetition." 106
In his separate concurring opinion, Justice Scalia rejected the majority’s
formulation. The "talismanic phrase" of "continuity plus relationship" is,
as put by Justice Scalia, about as helpful as advising the courts that
"life is a fountain." He writes:
x x x Thus, when §1961(5) says that a pattern "requires at least two
acts of racketeering activity" it is describing what is needful but not
sufficient. (If that were not the case, the concept of "pattern" would
have been unnecessary, and the statute could simply have attached
liability to "multiple acts of racketeering activity"). But what that
something more is, is beyond me. As I have suggested, it is also
beyond the Court. Today’s opinion has added nothing to improve our
prior guidance, which has created a kaleidoscope of Circuit positions,
except to clarify that RICO may in addition be violated when there is a
"threat of continuity." It seems to me this increases rather than removes
the vagueness. There is no reason to believe that the Court of Appeals
will be any more unified in the future, than they have in the past,
regarding the content of this law.
That situation is bad enough with respect to any statute, but it is
intolerable with respect to RICO. For it is not only true, as Justice
Marshall commented in Sedima, S.P.R.L. vs. Imrex Co., 473 U.S. 479 x
x x, that our interpretation of RICO has "quite simply revolutionize[d]
private litigation" and "validate[d] the federalization of broad areas of
state common law of frauds," x x x so that clarity and predictability in
RICO’s civil applications are particularly important; but it is also true
that RICO, since it has criminal applications as well, must, even in its
civil applications, possess the degree of certainty required for criminal
laws x x x. No constitutional challenge to this law has been raised in the
present case, and so that issue is not before us. That the highest court
in the land has been unable to derive from this statute anything more
than today’s meager guidance bodes ill for the day when that challenge
is presented.107
It bears noting that in Northwestern the constitutionality of the RICO law
was not challenged. 108 After Northwestern, the U.S. Supreme Court has
so far declined the opportunity to hear cases in which the void-for-
vagueness challenge to the pattern requirement was raised.109
Admittedly, at the district courts level, the state statutes (referred to as
Little RICOS)110 have so far successfully survived constitutional
challenge on void-for-vagueness ground. However, it must be
underscored that, unlike R.A. No. 7080, these state anti-racketeering
laws have invariably provided for a reasonably clear,
comprehensive and understandable definition of "pattern." 111 For
instance, in one state, the pattern requirement specifies that the related
predicate acts must have, among others, the same or similar purpose,
result, principal, victims or methods of commission and must be
connected with "organized crime.112 In four others, their pattern
requirement provides that two or more predicate acts should be related
to the affairs of the enterprise, are not isolated, are not closely related
to each other and connected in point of time and place, and if they are
too closely related, they will be treated as a single act. 113 In two other
states, pattern requirements provide that if the acts are not related to a
common scheme, plan or purpose, a pattern may still exist if the
participants have the mental capacity required for the predicate acts
and are associated with the criminal enterprise.114
All the foregoing state statutes require that the predicate acts be
related and that the acts occur within a specified time frame.
Clearly, "pattern" has been statutorily defined and interpreted in
countless ways by circuit courts in the United States. Their divergent
conclusions have functioned effectively to create variant criminal
offenses.115 This confusion has come about notwithstanding that almost
all these state laws have respectively statutorily defined "pattern". In
sharp contrast, R.A. No. 7080, as earlier pointed out, lacks such
crucial definition. As to what constitutes pattern within the meaning of
R.A. No. 7080 is left to the ad hoc interpretation of prosecutors and
judges. Neither the text of R.A. No. 7080 nor legislative history afford
any guidance as to what factors may be considered in order to prove
beyond reasonable doubt "pattern of overt or criminal acts indicative of
the overall unlawful scheme or conspiracy."
Be that as it may, it is glaringly fallacious to argue that "series" simply
means a "repetition" or "pertaining to two or more" and "combination" is
the "result or product or product of combining." Whether two or more or
at least three acts are involved, the majority would interpret the phrase
"combinations' or "series" only in terms of number of acts committed.
They entirely overlook or ignore Section 4 which requires "a pattern of
overt of criminal acts indicative of the overall unlawful scheme or
conspiracy" to convict.
If the elements of the offense are as what the majority has suggested,
the crime of plunder could have been defined in the following manner:
Where a public official, by himself or in conspiracy with others,
amasses or acquires money or property by committing two or more acts
in violation of Section 3 of the Anti-Graft and Corrupt Practices Act
(R.A. 3019), or Articles 210, 211, 212, 213, 214, 215, 216 and 217 of
the Revised Penal Code, he shall be guilty of the crime of plunder and
shall be punished by reclusion perpetua to death.
The above would be a straightforward and objective definition of the
crime of plunder. However, this would render meaningless the core
phrases "a combination or series of" "overt or criminal acts indicative of
the overall unlawful scheme or conspiracy," or the phrase "any
combination or series of the following means or similar schemes" or "a
pattern of overt or criminal acts indicative of the overall unlawful
scheme or conspiracy."
But that obviously is not the definition of the crime of plunder under
R.A. 7080. There is something more. A careful reading of the law would
unavoidably compel a conclusion that there should be a connecting link
among the "means or schemes" comprising a "series or combination"
for the purpose of acquiring or amassing "ill-gotten wealth." The bond
or link is an "overall unlawful scheme or conspiracy mentioned in
Section 4. The law contemplates a combination or series of criminal
acts in plunder done by the accused "in furtherance of the scheme or
conspiracy to amass, accumulate or acquire ill-gotten wealth." It does
not postulate acts committed randomly, separately or
independently or sporadically. Otherwise stated, if the legislature
intended to define plunder as the acquisition of ill-gotten wealth in the
manner espoused by the majority, the use in R.A. 7080 of such words
and phrases as "combination" and "series of overt or criminal acts" xxx
"in furtherance of the scheme or conspiracy" is absolutely pointless and
meaningless.
R.A. No. 7080 makes it possible for a person
conspiring with the accused in committing
one of the acts constituting the charge
of plunder to be convicted for the same crime.
Section 2 of R.A. No. 7080 states that "[a]ny person who participated
with the said public officer in the commission of an offense contributing
to the crime of plunder shall likewise be punished for such offense. In
the imposition of penalties, the degree of participation and the
attendance of mitigating and extenuating circumstances, as provided by
the Revised Penal Code, shall be considered by the court." Both parties
share the view that the law as it is worded makes it possible for a
person who participates in the commission of only one of the
component crimes constituting plunder to be liable as co-conspirator for
plunder, not merely the component crime in which he participated. 116
While petitioner concedes that it is easy to ascertain the penalty for an
accomplice or accessory under R.A. No. 7080, such is not the case
with respect to a co-principal of the accused. 117 In other words, a person
who conspires with the accused in the commission of only one of the
component crimes may be prosecuted as co-principal for the
component crime, or as co-principal for the crime of plunder, depending
on the interpretation of the prosecutor. The unfettered discretion
effectively bestowed on law enforcers by the aforequoted clause in
determining the liability of the participants in the commission of one or
more of the component crimes of a charge for plunder undeniably
poses the danger of arbitrary enforcement of the law.118
R.A. No. 7080 does not clearly state
the prescriptive period of the crime of plunder.
Section 6 of R.A. No. 7080 provides that the crime punishable under
said Act shall prescribe in twenty (20) years. Considering that the law
was designed to cover a "combination or series of overt or criminal
acts," or "a pattern of overt or criminal acts," from what time shall the
period of prescription be reckoned? From the first, second, third or last
act of the series or pattern? What shall be the time gap between two
succeeding acts? If the last act of a series or combination was
committed twenty or more years after the next preceding one, would
not the crime have prescribed, thereby resulting in the total extinction of
criminal liability under Article 89(b) of the Revised Penal Code? In
antithesis, the RICO law affords more clarity and definiteness in
describing "pattern of racketeering activity" as "at least two acts of
racketeering activity, one of which occurred within ten years (excluding
any period of imprisonment) after the commission of a prior act of
racketeering activity."119119 119 The U.S. state statutes similarly provide
specific time frames within which racketeering acts are committed.
The Solicitor General enjoins the Court to rectify the deficiencies in the
law by judicial construction. However, it certainly would not be feasible
for the Court to interpret each and every ambiguous provision without
falling into the trap of judicial legislation. A statute should be
construed to avoid constitutional question only when an alternative
interpretation is possible from its language. 120 Borrowing from the
opinion of the court121 in Northwestern,122 the law "may be a poorly
drafted statute; but rewriting it is a job for Congress, if it so inclined,
and not for this Court." But where the law as the one in question is
void on its face for its patent ambiguity in that it lacks comprehensible
standards that men of common intelligence must necessarily guess at
its meaning and differ as to its application, the Court cannot breathe life
to it through the guise of construction.
R.A. No. 7080 effectively eliminates mens rea
or criminal intent as an element of the crime of plunder.
Section 4 provides that for the purpose of establishing the crime of
plunder, "it shall not be necessary to prove each and every criminal act
done by the accused in furtherance of the scheme or conspiracy to
amass, accumulate or acquire ill-gotten wealth, it being sufficient to
establish beyond reasonable a pattern of overt or criminal acts
indicative of the overall unlawful scheme or conspiracy."
The majority would interpret this section to mean that the prosecution
has the burden of "showing a combination or series resulting in the
crime of plunder." And, once the minimum requirements for a
combination or a series of acts are met, there is no necessity for the
prosecution to prove each and every other act done by the accused in
furtherance of the scheme or conspiracy to amass, accumulate, or
acquire ill-gotten wealth.123
By its language, Section 4 eliminates proof of each and every
component criminal act of plunder by the accused and limits itself to
establishing just the pattern of overt or criminal acts indicative of
unlawful scheme or conspiracy. The law, in effect, penalizes the
accused on the basis of a proven scheme or conspiracy to commit
plunder without the necessity of establishing beyond reasonable doubt
each and every criminal act done by the accused in the crime of
plunder. To quote Fr. Bernas again: "How can you have a ‘series’ of
criminal acts if the elements that are supposed to constitute the series
are not proved to be criminal?"124
Moreover, by doing away with proof beyond reasonable doubt of each
and every criminal act done by the accused in the furtherance of the
scheme or conspiracy to acquire ill-gotten wealth, it being sufficient just
to prove a pattern of overt or criminal acts indicative of the overall
unlawful scheme or conspiracy, the Plunder Law effectively eliminated
the mens rea or criminal intent as an element of the crime. Because of
this, it is easier to convict for plunder and sentence the accused to
death than to convict him for each of the component crimes otherwise
punishable under the Revised Penal Code and other laws which are
bailable offenses. The resultant absurdity strikes at the very heart if the
constitutional guarantees of due process and equal protection.
Plunder is a malum in se.
The acts enumerated in Section 1(d) are mostly defined and penalized
by the Revised Penal Code, e.g. malversation, estafa, bribery and other
crimes committed by public officers. As such, they are by nature mala
in se crimes. Since intent is an essential element of these crimes, then,
with more reason that criminal intent be established in plunder which,
under R.A. No. 7659, is one of the heinous crimes 125 as pronounced in
one of its whereas clauses.126
The fact that the acts enumerated in Section 1(d) of R.A. 7080 were
made criminal by special law does not necessarily make the same
mala prohibita where criminal intent is not essential, although the term
refers generally to acts made criminal by special laws. For there is a
marked difference between the two. According to a well-known author
on criminal law:
There is a distinction between crimes which are mala in se, or wrongful
from their nature, such as theft, rape, homicide, etc., and those that are
mala prohibita, or wrong merely because prohibited by statute, such as
illegal possession of firearms.
Crimes mala in se are those so serious in their effects on society as to
call for almost unanimous condemnation of its members; while crimes
mala prohibita are violations of mere rules of convenience designed to
secure a more orderly regulation of the affairs of society. (Bouvier’s
Law Dictionary, Rawle’s 3rd Revision)
(1) In acts mala in se, the intent governs; but in those mala prohibit the
only inquiry is, has the law been violated? (People vs. Kibler, 106 N.Y.,
321, cited in the case of U.S. vs. Go Chico, 14 Phil. 132)
Criminal intent is not necessary where the acts are prohibited for
reasons of public policy, as in illegal possession of firearms. (People vs.
Conosa, C.A., 45 O.G. 3953)
(2) The term mala in se refers generally to felonies defined and
penalized by the Revised Penal Code. When the acts are inherently
immoral, they are mala in se, even if punished by special laws. On the
other hand, there are crimes in the Revised Penal Code which were
originally defined and penalized by special laws. Among them are
possession and use of opium, malversation, brigandage, and libel. 127
The component acts constituting plunder, a heinous crime, being
inherently wrongful and immoral, are patently mala in se, even if
punished by a special law and accordingly, criminal intent must clearly
be established together with the other elements of the crime; otherwise,
no crime is committed. By eliminating mens rea, R.A. 7080 does not
require the prosecution to prove beyond reasonable doubt the
component acts constituting plunder and imposes a lesser burden of
proof on the prosecution, thus paving the way for the imposition of the
penalty of reclusion perpetua to death on the accused, in plain violation
of the due process and equal protection clauses of the Constitution.
Evidently, the authority of the legislature to omit the element of scienter
in the proof of a crime refers to regulatory measures in the exercise of
police power, where the emphasis of the law is to secure a more
orderly regulations of the offense of society, rather than the punishment
of the crimes. So that in mala prohibita prosecutions, the element of
criminal intent is a requirement for conviction and must be provided in
the special law penalizing what are traditionally mala in se crimes. As
correctly pointed out by petitioner, 128 citing U.S. Supreme Court
decisions, the Smith Act was ruled to require "intent" to advocate 129 and
held to require knowledge of illegal advocacy. 130 And in another case,131
and ordinance making illegal the possession of obscene books was
declared unconstitutional for lack of scienter requirement.
Mens rea is a substantive due process requirement under the
Constitution, and this is a limitation on police power. Additionally, lack
of mens rea or a clarifying scienter requirement aggravates the
vagueness of a statute.
In Morisette v. U.S.132 the U.S. Supreme Court underscored the
stultifying effect of eliminating mens rea, thus:
The Government asks us by a feat of construction radically to change
the weights and balances in the scales of justice. The purpose and
obvious effect of doing away with the requirement of a guilty intent is to
ease the prosecution’s party to conviction, to strip the defendant of
such benefit as he derived at common law from innocence of evil
purpose, and to circumscribe the freedom heretofore allowed juries.
Such a manifest impairment of the immunities of the individual should
not be extended to common law crimes on judicial initiative.
In the same breath, Justice Florenz Regalado expreses serious doubts
as to the authority of the legislature to complex mala in se crimes with
mala prohibita, saying:
x x x although there has been a tendency to penalize crimes under
special laws with penalties "borrowed" from the Code, there is still the
question of legislative authority to consolidate crimes punished under
different statutes. Worse, where one is punished under the Code and
the other by the special law, both of these contingencies had not been
contemplated when the concept of a delito complejo was engrafted into
the Code.133
Petitioner is not estopped from questioning
the constitutionality of R.A. No. 7080.
The case at bar has been subject to controversy principally due to the
personalities involved herein. The fact that one of petitioner’s
counsels134 was a co-sponsor of the Plunder Law 135 and petitioner
himself voted for its passage when he was still a Senator would not in
any put him in estoppel to question its constitutionality. The rule on
estoppel applies to questions of fact, not of law. 136 Moreover, estoppel
should be resorted to only as a means of preventing injustice. 137 To hold
that petitioner is estopped from questioning the validity of R.A. No.
7080 because he had earlier voted for its passage would result in
injustice not only to him, but to all others who may be held liable under
this statute. In People vs. Vera,138 citing the U.S. case of Attorney
General v. Perkins, the Court held:
x x x The idea seems to be that the people are estopped from
questioning the validity of a law enacted by their representatives; that to
an accusation by the people of Michigan of usurpation upon their
government, a statute enacted by the people of Michigan is an
adequate statute relied on in justification is unconstitutional, it is a
statute only in form, and lacks the force of law, and is of no more saving
effect to justify action under it it had never been enacted. the
constitution is the supreme law, and to its behests the courts, the
legislature, and the people must bow. x x x139
The Court should not sanction the use of an equitable remedy to defeat
the ends of justice by permitting a person to be deprived of his life and
liberty under an invalid law.
Undoubtedly, the reason behind the enactment of R.A. 7080 is
commendable. It was a response to the felt need at the time that
existing laws were inadequate to penalize the nature and magnitude of
corruption that characterized a "previous regime." 140 However, where
the law, such as R.A. 7080, is so indefinite that the line between
innocent and condemned conduct becomes a matter of guesswork, the
indefiniteness runs afoul of due process concepts which require that
persons be given full notice of what to avoid, and that the discretion of
law enforcement officials, with the attendant dangers of arbitrary and
discriminatory enforcement, be limited by explicit legislative
standards.141 It obfuscates the mind to ponder that such an ambiguous
law as R.A. No. 7080 would put on the balance the life and liberty of the
accused against whom all the resources of the State are arrayed. It
could be used as a tool against political enemies and a weapon of hate
and revenge by whoever wields the levers of power.
I submit that the charge against petitioner in the Amended Information
in Criminal Case No. 26558 does not constitute "plunder" under R.A.
No. 7080, as amended by R.A. No. 7659. If at all, the acts charged may
constitute offenses punishable under the Anti-Graft and Corrupt
Practices Act (R.A. No. 3019) or the Revised Penal Code. Hence, the
information charging petitioner with plunder must be quashed. Such
quashal, however, should be without prejudice to the filing of new
informations for acts under R.A. No. 3019, of the Revised Penal Code
and other laws. Double jeopardy would not bar the filing of the same
because the dismissal of the case is made with the express consent of
the petitioner-accused.142
In view of the foregoing, I vote to GRANT the petition.
SEPARATE DISSENTING OPINION
PARDO, J.:
With due respect, I vote to grant the petition on the second ground
raised therein, that is, multiplicity of offenses charged in the amended
information.1 Consequently, the resolution of the Sandiganbayan must
be set aside, and the case remanded to the Ombudsman for the
amendment of the information to charge only a single offense.
In my view, it is unnecessary to rule on the unconstitutionality of the
entire law,2 R. A. No. 7080, as amended by R. A. No. 7659, although I
share the opinion of the dissenting justices in the case of People v.
Echagaray,3 that the heinous crime law is unconstitutional. Hence, the
amendments to the plunder law prescribing the death penalty therefor
are unconstitutional. I am of the view that the plunder law penalizes
acts that are mala in se, and consequently, the charges must be the
specific acts alleged to be in violation of the law, committed with malice
and criminal intent. At any rate, I venture the view that Section 4, R. A.
No. 7080, must be interpreted as requiring proof beyond reasonable
doubt of all the elements of plunder as prescribed in the law, including
the elements of the component crimes, otherwise, the section will be
unconstitutional.
DISSENTING OPINION
SANDOVAL–GUTIERREZ, J.:
At times when speaking against popular views can subject a member of
this Court to all sorts of unfair criticism and pressure from the media,
the lure not to wield the judicial pen is at its crest. Nevertheless, I
cannot relent to such enticement. Silence under such circumstances
may mean not only weakness, but also insensibility to the legal
consequence of a constitutional adjudication bound to affect not only
the litigants, but the citizenry as well. Indeed, the core issue in this case
is highly significant, the resolution of which is inevitably historical. Thus,
today, I prefer to take a stand and, therefore, dissent from the majority
opinion.
It is beyond dispute that Republic Act No. 7080 (R.A. No. 7080), 1
entitled "An Act Penalizing the Crime of Plunder," is controversial and
far-reaching. Nonetheless, it is my view that it is also vague and fuzzy,
inexact and sweeping. This brings us to the query - may R.A. No. 7080
be enforced as valid and its shortcomings supplied by judicial
interpretation? My answer, to be explained later, is "NO."
As a basic premise, we have to accept that even a person accused of a
crime possesses inviolable rights founded on the Constitution which
even the welfare of the society as a whole cannot override. The rights
guaranteed to him by the Constitution are not subject to political
bargaining or to the calculus of social interest. Thus, no matter how
socially-relevant the purpose of a law is, it must be nullified if it tramples
upon the basic rights of the accused.
Enshrined in our Constitution is the ultimate guaranty that "no person
shall be deprived of life, liberty, or property without due process of
law."2 This provision in the Bill of Rights serves as a protection of the
Filipino people against any form of arbitrariness on the part of the
government, whether committed by the legislature, the executive or the
judiciary. Any government act that militates against the ordinary norms
of justice and fair play is considered an infraction of the due process;
and this is true whether the denial involves violation merely of the
procedure prescribed by law or affects the very validity of the law itself. 3
The same Due Process Clause protects an accused against conviction
except upon proof beyond reasonable doubt of every fact necessary
to constitute the crime with which he is charged. The reason for this
was enunciated in In Re Winship:4 "[t]he accused during a criminal
prosecution has at stake interest of immense importance, both because
of the possibility that he may lose his liberty (or life) upon conviction
and because of the certainty that he would be stigmatized by the
conviction." In view thereof, any attempt on the part of the legislature to
diminish the requirement of proof in criminal cases should be
discouraged.
I
R.A. No. 7080, as amended, is unconstitutional. Albeit the legislature
did not directly lower the degree of proof required in the crime of
plunder from proof beyond reasonable doubt to mere preponderance of
or substantial evidence, it nevertheless lessened the burden of the
prosecution by dispensing with proof of the essential elements of
plunder. Let me quote the offending provision:
SEC. 4. Rule of Evidence. – For purposes of establishing the crime of
plunder, it shall not be necessary to prove each and every criminal
act done by the accused in furtherance of the scheme or conspiracy
to amass, accumulate, or acquire ill-gotten wealth, it being sufficient to
establish beyond reasonable doubt a pattern of overt or criminal acts
indicative of the overall unlawful scheme or conspiracy.
In every criminal prosecution, the law recognizes certain elements as
material or essential. Calling a particular fact an "essential element"
carries certain legal consequences. In this case, the consequence that
matters is that the Sandiganbayan cannot convict the accused unless it
unanimously5 finds that the prosecution has proved beyond reasonable
doubt each element of the crime of plunder.
What factual elements must be proved beyond reasonable doubt
to constitute the crime of plunder?
Ordinarily, the factual elements that make up a crime are specified in
the law that defines it. Under R.A. No 7080, as amended, the essential
elements of the crime of plunder are: a) that the offender is a public
officer; b) that he amasses, accumulates or acquires ill-gotten wealth
through a combination or series of overt or criminal acts described in
Section 1 (d), to wit:
1) Through misappropriation, conversion, misuse, or
malversation of public funds or raids on the public treasury;
2) By receiving, directly or indirectly, any commission, gift,
share, percentage, kickbacks, or any other form of pecuniary
benefit from any person and/or entity in connection with any
government contract or project or by reason of the office or
position of the public officer concerned;
3) By the illegal or fraudulent conveyance or disposition of
assets belonging to the National Government or any of its
subdivision, agencies or instrumentalities or government –
owned or controlled corporations and their subsidiaries;
4) By obtaining, receiving or accepting directly, or indirectly
any shares of stock, equity or any other form of interest or
participation including the promise of future employment in
any business enterprise or undertaking;
5) By establishing agricultural, industrial or commercial
monopolies or other combinations and/or implementation of
decrees and orders intended to benefit particular person or
special interests; or
6) By taking undue advantage of official position, authority,
relationship, connection, or influence to unjustly enrich himself
or themselves at the expense and to the damage and
prejudice of the Filipino people and the Republic of the
Philippines.
and c) that the aggregate amount or total value of the ill-gotten wealth
is at least Fifty Million Pesos (P50,000,000.00). 6
Does the phrase "combination or series of overt or criminal acts
described in Section 1 (d)" mean that the "criminal acts" merely
constitute the means to commit plunder? Or does it mean that those
"criminal acts," are essential elements of plunder?
When Section 4 of R.A. No. 7080 mandates that it shall not be
necessary for the prosecution to prove each and every criminal act
done by the accused, the legislature, in effect, rendered the
enumerated "criminal acts" under Section 1 (d) merely as means and
not as essential elements of plunder. This is constitutionally infirmed
and repugnant to the basic idea of justice and fair play. 7 As a matter of
due process, the prosecution is required to prove beyond
reasonable doubt every fact necessary to constitute the crime with
which the defendant is charged. The State may not specify a
lesser burden of proof for an element of a crime. 8 With more
reason, it should not be allowed to go around the principle by
characterizing an essential element of plunder merely as a "means" of
committing the crime. For the result is the reduction of the burden of the
prosecution to prove the guilt of the accused beyond reasonable doubt.
Let me elucidate on the vices that come with Section 4.
First, treating the specific "criminal acts" merely as means to commit
the greater crime of plunder, in effect, allows the imposition of the death
penalty even if the Justices of the Sandiganbayan did not
"unanimously" find that the accused are guilty beyond reasonable doubt
of those "criminal acts." The three Justices need only agree that the
accused committed at least two of the criminal acts, even if not
proved by evidence beyond reasonable doubt. They do not have
to agree unanimously on which two.
Let us consider the present case against former President Joseph
Ejercito Estrada. The accusatory portion of the information in Criminal
Case No. 26558 charges Mr. Estrada and others of willfully, unlawfully
and criminally amassing, accumulating and acquiring ill-gotten wealth in
the aggregate amount of P4,097,804,173.17 more or less, through a
combination and series of overt and criminal acts described as
follows:
"a) by receiving, collecting, directly or indirectly, on many
instances, so called "jueteng money" from gambling operators
in connivance with co-accused Jose "Jinggoy" Estrada,
 Yolanda Ricaforte and Edward Serapio, as witnessed by Gov.
Luis Chavit Singson, among other witnesses, in the aggregate
amount of FIVE HUNDRED FORTY-FIVE MILLION PESOS
(P545,000,000.00), more or less, in consideration of their
protection from arrest or interference by law enforcers in their
illegal "jueteng" activities; and
b) by misappropriating, converting and misusing his gain and
benefit public fund in the amount of ONE HUNDRED THIRTY
MILLION PESOS (P130,000,000.00), more or less,
representing a portion of the One Hundred Seventy Million
Pesos (P170,000,000.00) tobacco excise tax share allocated
for the Province of Ilocos Sur under R.A. No. 7171, in
conspiracy with co-accused Charlie "Atong" Ang, Alma Alfaro,
Eleuterio Tan a.k.a Eleuterio Ramos Tan or Mr. Uy., and Jane
Doe a.k.a Delia Rajas as witnesses by Gov. Luis "Chavit"
Singson, among other witnesses; and
c) by directing, ordering and compelling the Government
Service Insurance System (GSIS) and the Social Security
System (SSS) to purchase and buy a combined total of
P681,733,000. shares of stock of Belle Corporation in the
aggregate value of One Billion Eight Hundred Forty Seven
Pesos and Fifty Centavos (P1,847,578,057.50), for the
purpose of collecting for his personal gain and benefit, as in
fact he did collect and receive the sum of ONE HUNDRED
EIGHTY NINE MILLION SEVEN HUNDRED THOUSAND
PESOS (P189,700,000.00), as commission from said stock
purchase; and
d) by unjustly enriching himself in the amount of THREE
BILLION TWO HUNDRED THIRTY THREE MILLION ONE
HUNDRED FOUR THOUSAND ONE HUNDRED SEVENTY
THREE PESOS AND SEVENTEEN CENTAVOS
(P3,233,104,173.17) comprising his unexplained wealth,
acquired, accumulated and amassed by him under his
account name "Jose Velarde" with Equitable PCI Bank."
Since it is not necessary to prove each criminal act, the inevitable
conclusion is that Mr. Estrada may be convicted of the crime of plunder
without the Justices of the Sandiganbayan "unanimously" deciding
which two of the four criminal acts have actually been committed. In
short, all that R.A. No. 7080 requires is that each Justice must be
convinced of the existence of a "combination or series." As to which
criminal acts constitute a combination or series, the Justices need not
be in full agreement. Surely, this would cover-up a wide disagreement
among them about just what the accused actually did or did not do.
Stated differently, even if the Justices are not unified in their
determination on what criminal acts were actually committed by the
accused, which need not be proved under the law, still, they could
convict him of plunder.
Considering that what R.A. No. 7080 punishes is the plurality of criminal
acts indicative of the grand scheme or conspiracy to amass ill-gotten
wealth, it is imperative to focus upon the individual "criminal acts" in
order to assure the guilt of the accused of plunder.
Second, R.A. No. 7080 lumps up into one new offense of plunder six
(6) distinct crimes which by themselves are currently punishable under
separate statutes or provisions of law. The six (6) separate crimes
become mere "means or similar schemes" to commit the single offense
of plunder. It bears emphasis that each of the separate offenses is a
crime mala in se. The commission of any offense mala in se is
inherently accompanied by a guilty mind or a criminal intent. 9
Unfortunately, R.A. No. 7080 converted the six mala in se offenses into
one crime which is mala prohibita wherein the intent becomes
insignificant. Upon the commission of the proscribed act, without proof
of intent, the law is considered violated. 10 Consequently, even acts
recklessly committed (i.e. without intent) can be punished by death.
Third, Section 4 mandates that it shall not be necessary for the
prosecution to prove each and every criminal act done by the
accused x x x it being sufficient to prove beyond reasonable doubt
a pattern of overt or criminal acts. By its own terminology, Section 4
requires that the "pattern" be proved by evidence beyond reasonable
doubt. Initially, we must disassociate the specific "criminal acts" from
the "pattern of criminal acts." These two phrases do not refer to one
and the same thing. Pattern, as defined in the dictionary, means an
established mode of behavior.11 In the crime of plunder, the existence of
a "pattern" can only be inferred from the specific "criminal acts" done by
the accused. Several queries may be raised to determine the existence
of a "pattern." Are these criminal acts related or tied to one another? Is
the subsequent criminal act a mere continuation of the prior criminal
act? Do these criminal acts complement one another as to bring about
a single result? Inevitably, one must focus first on each criminal act to
ascertain the relationship or connection it bears with the other criminal
acts, and from there determine whether a certain "pattern" exists. But
how could "pattern" be proved beyond reasonable doubt when in
the first place the specific "criminal acts" from which such pattern
may be inferred are not even required to be proved?
And fourth, plunder is a very serious offense. What is at stake under the
law is not only the liberty of the accused but his life and property as
well. Thus, it will be extremely unjust to lessen the prosecution’s burden
of proof to such a degree not commensurate to what the accused
stands to suffer. If a person will lose his life, justice requires that every
fact on which his guilt may be inferred must be proved beyond
reasonable doubt.
Providing a rule of evidence which does not require proof beyond
reasonable doubt to establish every fact necessary to constitute the
crime is a clear infringement of due process. While the principles of the
law of evidence are the same whether applied on civil or criminal trials,
they are more strictly observed in criminal cases. 12 Thus, while the
legislature of a state has the power to prescribe new or alter
existing rules of evidence, or to prescribe methods of proof, the
same must not violate constitutional requirements or deprive any
person of his constitutional rights. 13 Unfortunately, under R.A. No.
7080, the State did not only specify a lesser burden of proof to
sustain an element of the crime; it even dispensed with proof by
not considering the specific "criminal acts" as essential elements.
That it was the clear intention of the legislature is evident from the
Senate deliberation, thus:
"Senator Guingona. Since it is a series or a scheme,what amount of
evidence will, therefore, be required? Must there be a pattern of the
criminal acts? Must there be a series of briberies, for example? Or, can
there be only one?
Senator Tanada. Under Section 4 of the bill, Mr. President, it is
provided that:
"For purposes of establishing the OFFENSE, of plunder, it shall not be
necessary to prove each and every criminal act done by the accused in
furtherance of the scheme or conspiracy to amass, accumulate, or
acquire ill-gotten wealth… But, there must be enough evidence
"sufficient to establish beyond reasonable doubt a pattern of overt or
criminal acts of the overall unlawful scheme or conspiracy."
So, that is the quantum of evidence that would be required under this
proposal measure.
Senator Guingona. That is sufficient to establish the prima facie
case.14
xxxxxx
Senator Romulo. That, perhaps, is a good provision of the bill. But,
may I ask, Mr. President, what is in this bill that would insure that there
would be a speedier process by which this crime of plunder would
readily and immediately processed and convicted or acquitted than is
now existing in present laws?
Senator Tanada. Yes, x x x.
Now, on the second point, Mr. President, I believe that what could
make faster and speedier prosecutions of these grafters would be a
change that will be authorized in this bill, at least, in the filing of
information against the perpetrators. Under the existing criminal
procedure, as I said earlier, there can only be one offense charged per
information. So, if there is going to be a series of overt or criminal acts
committed by the grafter, then that would necessitate the filing of so
many informations against him. Now, if this bill becomes a law, then
that means that there can be only one information filed against the
alleged grafter. And the evidence that will be required to convict
him would not be evidence for each and every individual criminal
act but only evidence sufficient to establish the conspiracy or
scheme to commit this crime of plunder.15
xxxxxx
Senator Guingona. May I just be clarified Mr. President. In this Section
4, a pattern of the criminal acts is all that is required. Would this pattern
of criminal acts be also sufficient to establish a prima facie case?
Senator Tanada. Mr. President, under Section 4, it would not only be
sufficient to establish a prima facie case. It would be sufficient to
establish guilt as long as the evidence, necessary to establish guilt
beyond reasonable doubt is presented."16
In dispensing with proof of each criminal act, the clear objective of
Congress is to render it less difficult for the prosecution to prove the
crime of plunder. While this presupposes a noble intention, I do not
think there is a sufficient justification. I, too, have the strong desire to
eliminate the sickness of corruption pervading in the Philippine
government, but more than anything else, I believe there are certain
principles which must be maintained if we want to preserve fairness in
our criminal justice system. If the prosecution is not mandated to prove
the specific "criminal acts," then how can it establish the existence of
the requisite "combination or series" by proof beyond reasonable
doubt?
II
Another valid constitutional objection to R.A. No. 7080 is the vagueness
of the term "pattern." As stated by Mr. Justice Kapunan, in his Dissent,
the concept of "pattern of overt or criminal acts" embodied in the law
was derived by Congress from the RICO (Racketeer Influenced and
Corrupt Organizations) statute. 17 I am, therefore, constrained to refer to
US law and jurisprudence. "Pattern" as defined in the RICO statute
means "as requiring at least two acts of racketeering activity….the last
of which occurred within ten years….after the commission of the prior
act of racketeering activity.18
Mr. Justice Kapunan observed that unlike the RICO law, the law on
plunder does not specify a) the number of criminal acts necessary
before there could be a "pattern," as well as b) the period within which
the succeeding criminal acts should be committed. These failures
render the law void for its vagueness and broadness.
Indeed, Congress left much to be desired. I am at a quandary on how
many delictual acts are necessary to give rise to a "pattern of overt or
criminal acts" in the crime of plunder. If there is no numerical standard,
then, how should the existence of "pattern" be ascertained? Should it
be by proximity of time or of relationship? May an act committed two
decades after the prior criminal act be linked with the latter for the
purpose of establishing a pattern?
It must be remembered that plunder, being a continuous offense, the
"pattern of overt or criminal acts" can extend indefinitely, i.e., as long as
the succeeding criminal acts may be linked to the initial criminal act.
This will expose the person concerned to criminal prosecution ad
infinitum. Surely, it will undermine the purpose of the statute of
limitations, i.e., to discourage prosecution based on facts obscured by
the passage of time, and to encourage law enforcement officials to
investigate suspected criminal activity promptly. 19 All these
undesirable consequences arise from the fact that the plunder law
fails to provide a period within which the next criminal act must be
committed for the purpose of establishing a pattern. I believe R.A.
No. 7080 should have provided a cut-off period after which a
succeeding act may no longer be attached to the prior act for the
purpose of establishing a pattern. In reiteration, the RICO law defines
"pattern" as requiring at least two acts of racketeering activity… the
last of which occurred within ten years… after the commission of the
prior act of racketeering activity. Such limitation prevents a subsequent
racketeering activity, separated by more than a decade from the prior
act of racketeering, from being appended to the latter for the purpose of
coming up with a pattern. We do not have the same safeguard under
our law.
Significantly, in Sedima, S.P.R.L v. Imrex Co.,20 the United States
Supreme Court expressed dismay that Congress has failed to properly
define the term "pattern" at all but has simply required that a "pattern"
includes at least two acts of racketeering activity. The Court concluded
that "pattern" involves something more than two acts, and after
examining RICO’s legislative history, settled on "continuity plus
relationship" as the additional requirement.
Years later, in H.C. Inc. v. The Northwestern Bell Tel., 21 the U.S.
Supreme Court conceded that "the continuity plus relationship" means
different things to different circuits. Nevertheless, it held firm to the
Sedima requirement that "in order to establish a pattern, the
government has to show "that the racketeering predicates are related,
and that they amount to or pose a threat of continued criminal activity."
Justice Scalia, in a concurring opinion in which three other justices
joined, derided the "relationship" requirement as not "much more
helpful [to the lower courts] than telling them to look for a "pattern" - -
which is what the statute already says." As for the continuity
requirement, Justice Scalia said: "Today’s opinion has added nothing to
improve our prior guidance, which has created a kaleidoscope of circuit
positions, except to clarify that RICO may in addition be violated when
there is a 'threat of continuity'. It seems to me this increases rather than
removes the vagueness. There is no reason to believe that the Court of
Appeals will be any more unified in the future, than they have in the
past, regarding the content of this law."
Aware of the ambiguities present in the RICO law the drafters of the
New York "Organized Crime Control Act" (a progeny of RICO) now
more specifically define "pattern of criminal activity" as conduct
engaged in by persons charged in an enterprise corruption count
constituting three or more criminal acts that (a) were committed within
ten years from the commencement of the criminal action; (b) are
neither isolated incidents, nor so closely related and connected in point
of time or circumstance of commission as to constitute a criminal
offense or criminal transaction, as those terms are defined in section
40.10 of the criminal procedure law; and (c) are either: (i) related to one
another through a common scheme or plan or (ii) were committed,
solicited, requested, importuned or intentionally aided by persons acting
with the mental culpability required for the commission thereof and
associated with or in the criminal enterprise.22
If the term "pattern" as defined in the RICO law is continuously
subjected to constitutional attacks because of its alleged vagueness,
how much more the term "pattern" in R.A. No. 7080 which does not
carry with it any limiting definition and can only be read in context.
Indeed, there is no doubt that the invalidity of the law based on
vagueness is not merely debatable - it is manifest. Thus, this Court
should declare R.A. No. 7080 unconstitutional.
III
Lastly, the terms "combination" and "series" are likewise vague. Hence,
on the basis of the law, a conviction of an accused cannot be
sustained. A statute that does not provide adequate standards for
adjudication, by which guilt or innocence may be determined, should be
struck down.23 Crimes must be defined in a statute with appropriate
certainty and definiteness.24 The standards of certainty in a statute
prescribing punishment for offenses are higher than in those depending
primarily on civil sanctions for their enforcement. 25 A penal statute
should therefore be clear and unambiguous. 26 It should explicitly
establish the elements of the crime which it creates 27 and provide some
reasonably ascertainable standards of guilt.28 It should not admit of
such a double meaning that a citizen may act on one conception of its
requirements and the courts on another. 29
I agree with the observation of Mr. Justice Kapunan that "resort to the
dictionary meaning of the terms ‘combination’ and ‘series’ as well as
recourse to the deliberations of the lawmakers only serve to prove that
R.A. No. 7080 failed to satisfy the requirement of the Constitution on
clarity and definiteness." The deliberations of our law-makers, as
quoted verbatim in Justice Kapunan's Dissent, indeed, failed to shed
light on what constitute "combination" and "series."30
I believe this is fatal.
The essence of the law on plunder lies in the phrase "combination or
series of overt or criminal acts." As can be gleaned from the Record of
the Senate, the determining factor of R.A. 7080 is the plurality of the
overt acts or criminal acts under a grand scheme or conspiracy to
amass ill-gotten wealth. Thus, even if the amassed wealth equals or
exceeds fifty million pesos, a person cannot be prosecuted for the
crime of plunder if there is only a single criminal act. 31
Considering that without plurality of overt or criminal acts, there can be
no crime of plunder, due process of law demands that the terms
"combination" and "series" be defined with exactitude in the law itself.
Equating these terms with mere "plurality" or "two or more," is
inaccurate and speculative. For one, a "series" is a group of usually
three or more things or events standing or succeeding in order and
having like relationship to each other. 32 The Special Prosecution
Division Panel defines it as "at least three of the acts enumerated under
Section 1(d) thereof."33 But it can very well be interpreted as only one
act repeated at least three times. And the Office of the Solicitor
General, invoking the deliberations of the House of Representatives,
contends differently. It defines the term series as a "repetition" or
pertaining to "two or more."34 The disparity in the Prosecution and
OSG’s positions clearly shows how imprecise the term "series" is.
This should not be countenanced. Crimes are not to be created by
inference.35 No one may be required, at the peril of life, liberty or
property to guess at, or speculate as to, the meaning of a penal
statute.36 An accused, regardless of who he is, is entitled to be tried
only under a clear and valid law.
Respondents argue that the vagueness of R.A. No. 7080, as amended,
is cured when the Information clearly specified the acts constituting the
crime of plunder. I do not agree. It is the statute and not the accusation
under it that prescribes the rule to govern conduct and warns against
aggression.37 If on its face, a statute is repugnant to the due process
clause on account of vagueness, specification in the Information of the
details of the offense intended to be charged will not serve to validate
it.38
On the argument that this Court may clarify the vague terms or explain
the limits of the overbroad provisions of R.A. No. 7080, I should
emphasize that this Court has no power to legislate.
Precision must be the characteristic of penal legislation. For the Court
to define what is a crime is to go beyond the so-called positive role in
the protection of civil liberties or promotion of public interests. As stated
by Justice Frankfurter, the Court should be wary of judicial attempts to
impose justice on the community; to deprive it of the wisdom that
comes from self-inflicted wounds and the strengths that grow with the
burden of responsibility.39
A statute which is so vague as to permit the infliction of capital
punishment on acts already punished with lesser penalties by clearly
formulated law is unconstitutional. The vagueness cannot be cured by
judicial construction.
Also, not to be glossed over is the fact that R.A. 7080, as amended, is a
novel law. Hence, there is greater need for precision of terms. The
requirement that law creating a crime must be sufficiently explicit to
inform those subject to it, what conduct on their part will render them
liable to its penalties, has particular force when applied to statutes
creating new offenses. For that reason, those statutes may not be
generally understood, or may be subject of generally accepted
construction.40
Today, I recall what James Madison remarked in presenting the Bill of
Rights to the United States Congress in 1789: "if they (Bill of Rights)
are incorporated into the Constitution, independent tribunals of justice
will consider themselves in a peculiar manner the guardians of those
rights; they will be an impenetrable bulwark against every assumption
of power in the legislative or executive; and they will be naturally led to
resist every encroachment upon rights expressly stipulated for in the
Constitution by the declaration of rights."41 Time did not render his
foreboding stale. Indeed, in every constitutional democracy, the
judiciary has become the vanguard of these rights. Now, it behooves
this Court to strike an unconstitutional law. The result, I concede, may
not be politically desirable and acceptable, nevertheless, I am fully
convinced that it is constitutionally correct.
To recapitulate, R.A. No. 7080 is unconstitutional because it violates
the DUE PROCESS CLAUSE of the Constitution. The vagueness of its
terms and its incorporation of a rule of evidence that reduces the
burden of the prosecution in proving the crime of plunder tramples upon
the basic constitutional rights of the accused.
In fine, I can only stress that the one on trial here is not Mr. Estrada, but
R.A. No. 7080. The issue before this Court is not the guilt or innocence
of the accused, but the constitutionality of the law. I vote to grant the
petition, not because I favor Mr. Estrada, but because I look beyond
today and I see that this law can pose a serious threat to the life, liberty
and property of anyone who may come under its unconstitutional
provisions. As a member of this Court, my duty is to see to it that the
law conforms to the Constitution and no other. I simply cannot, in good
conscience, fortify a law that is patently unconstitutional.
WHEREFORE, I vote to grant the petition.
DISSENTING OPINION
YNARES-SANTIAGO, J.:
It is an ancient maxim in law that in times of frenzy and excitement,
when the desire to do justice is tarnished by anger and vengeance,
there is always the danger that vital protections accorded an accused
may be taken away.
The Plunder Law and its amendment were enacted to meet a national
problem demanding especially immediate and effective attention. By its
very nature, the law deserved or required legislative drafting of the
highest order of clarity and precision.
Substantive due process dictates that there should be no arbitrariness,
unreasonableness or ambiguity in any law which deprives a person of
his life or liberty. The trial and other procedures leading to conviction
may be fair and proper. But if the law itself is not reasonable legislation,
due process is violated. Thus, an accused may not be sentenced to
suffer the lethal injection or life imprisonment for an offense understood
only after judicial construction takes over where Congress left off, and
interpretation supplies its meaning.
The Constitution guarantees both substantive and procedural due
process1 as well as the right of the accused to be informed of the nature
and cause of the accusation against him. 2 Substantive due process
requires that a criminal statute should not be vague and uncertain. 3
More explicitly –
That the terms of a penal statute. . . must be sufficiently explicit to
inform those who are subject to it what conduct on their part will render
them liable to penalties, is a well–recognized requirement, consonant
alike with ordinary notions of fair play and the settled rules of law. And a
statute which either forbids or requires the doing of an act in terms so
vague that men of common intelligence must necessarily guess at its
meaning and differ as to its application, violates the first essential of
due process.4
The doctrine of constitutional uncertainty is also based on the right of
the accused to be informed of the nature and cause of the accusation. 5
Fundamental fairness dictates that a person cannot be sent to jail for a
crime that he cannot with reasonable certainty know he was
committing.6 Statutes defining crimes run afoul of the due process
clause if they fail to give adequate guidance to those who would be law-
abiding, to advise defendants of the nature of the offense with which
they are charged or to guide courts trying those who are accused. 7 In
short, laws which create crime ought to be so explicit that all men
subject to their penalties may know what acts it is their duty to avoid. 8
A reading of the Plunder Law immediately shows that it is phrased in a
manner not susceptible to ready or clear understanding. In the desire to
cover under one single offense of plunder every conceivable criminal
activity committed by a high government official in the course of his
duties, Congress has come out with a law unduly vague, uncertain and
broad.
The doctrines of overbreadth and void-for-vagueness in Constitutional
Law were developed in the context of freedom of speech and of the
press. However, they apply equally, if not more so, to capital offenses.
In the present case, what the law seeks to protect or regulate involves
the deprivation of life itself and not merely the regulation of expression.
In its early formulation, the overbreadth doctrine states that a
governmental purpose to control or prevent activities constitutionally
subject to regulation may not be achieved by means which sweep
unnecessarily broadly and thereby invade the area of protected
freedoms.9
A statute, especially one involving criminal prosecution, must be
definite to be valid. A statute is vague or overbroad, in violation of the
due process clause, where its language does not convey sufficiently
definite warning to the average person as to the prohibited conduct. A
statute is unconstitutionally vague if people of common intelligence
must necessarily guess at its meaning. 10
It is not only prosecutors and judges who are concerned. The need for
definiteness applies with greater force to the accused and those in
positions where opportunities for them to commit the proscribed offense
are present. They must understand exactly what prohibited activity will
be punished by capital punishment. Sadly, even the record of
deliberations in Congress cited in the motion to quash shows that even
the members of the Senate who are illustrious lawyers found the
Plunder Law vague.
Under Section 1 of R.A. 7080 and Section 12 of R.A. 7659, the
acquisition of at least P50,000,000.00 of ill-gotten wealth is punished by
reclusion perpetua to death, if committed as follows:
1) Through misappropriation, conversion, misuse, or
malversation of public funds or raids on the public treasury;
2) By receiving, directly or indirectly, any commission, gift,
share, percentage, kickbacks or any other form of pecuniary
benefit from any person and/or entity in connection with any
government contract or project or by reason of the office or
position of the public officer concerned;
3) By the illegal or fraudulent conveyance or disposition of
assets belonging to the National Government or any of its
subdivisions, agencies or instrumentalities or government-
owned or controlled corporations and their subsidiaries;
4) By obtaining, receiving or accepting directly or indirectly
any shares of stock, equity or any other form of interest or
participation including the promise of future employment in
any business enterprise or undertaking;
5) By establishing agricultural, industrial or commercial
monopolies or other combinations and/or implementation of
decrees and orders intended to benefit particular persons or
special interests; or
6) By taking undue advantage of official position, authority,
relationship, connection or influence to unjustly enrich himself
or themselves at the expense and to the damage and
prejudice of the Filipino people and the Republic of the
Philippines.11
The crimes of malversation of public funds and bribery, which appear to
be included among the modes of committing plunder, have acquired
well-defined meanings under our present penal statutes. The accused
immediately knows how to defend and justify his actions. The
prosecution understands the quantum and nature of the evidence he
has to produce in court. The Judge can apply the law with straight and
positive judgment because there is no vagueness about it.
The Sandiganbayan, however, has ruled that the Plunder Law does not
make any reference to any specific provision of laws other than R.A.
7080, as amended. It is an entirely new offense where malversation or
bribery become "generic terms" according to the court. And since
"generic" refers to an entire group or class of related matters, the
discretion given to the prosecutor and the judge figuratively runs riot.
Under the same paragraph of the Plunder Law, malversation is lumped
with "misuse of public funds." Misuse can be as innocuous as error or it
can be as severe as corruption or embezzlement. The terms "abuse,"
"distortion," "misapplication," "mismanagement," "poor stewardship,"
"malpractice," "debasement," or "breach of trust," all conceivably fall
under the generic term "misuse." Exactly when does an administrative
offense of misuse become the capital crime of plunder? What degree of
misuse is contemplated under the law?
A penal law violates due process where inherently vague statutory
language permits selective law enforcement.12 Under the Plunder Law,
a crusading public officer who steps on too many important toes in the
course of his campaign could be prosecuted for a capital offense, while
for exactly the same acts, an official who tries to please everybody can
be charged whether administratively or for a much lighter offense.
For instance, direct bribery under Article 210 of the Revised Penal
Code is punished with prision mayor in its medium or minimum periods,
prision correccional in its medium period, or prision mayor in its
minimum period, depending on the manner of commission. 13 Indirect
bribery under Article 211 is punished with prision correccional in its
medium and maximum periods.14 Under the Plunder Law, the penalty is
reclusion perpetua to death. The void-for-vagueness infirmity becomes
all the more apparent if the proscribed activity is "misuse of public
funds." The prosecutor is given broad powers of selective law
enforcement. For "misuse," exactly the same acts could be punished
with death under the Plunder Law, or mere dismissal with prejudice to
future government employment under the Civil Service Law.
The provision in the Plunder Law on "implementation of decrees and
orders intended to benefit particular persons or special interests" also
calls for more specific elucidation. If the only person benefited is
himself, does that fall under "particular person?" Decrees and orders
issued by a top government official may be intended to benefit certain
segments of society such as farmers, manufacturers, residents of a
geographical area and the like. If in the process a close relative
acquires P50,000,000.00 because of development in that sector solely
because of the decree and without lifting a finger, is that plunder? The
vagueness can be better appreciated by referring to petitioner’s
arguments that the element of mens rea in mala in se crimes has been
abolished and the offenses have been converted to mala prohibita. If
the guilty intent is eliminated, even innocent acts can be plunder. The
law was not drafted for petitioner alone. It applies to all public officers.
As petitioner has stated, what Congress did in enacting the Plunder
Law was to take out the provisions of the Revised Penal Code on
malversation, estafa, bribery, and other crimes committed by public
officers, mix these with special laws on graft and corruption and
together with a couple of non-criminal acts, combine them into a special
law and call it "plunder."
Early in the history of this Court, it ruled that in acts mala in se, the
criminal intent governs. But in those acts mala prohibita, the only
inquiry is: has the law been violated?15 Acts constituting malversation,
estafa, and bribery are mala in se. The courts must inquire into the
criminal intent, the evil nature or wrongful disposition behind the
criminal acts. In mala prohibita crimes, there is a violation of a
prohibitory law and the inquiry is, therefore, has the law been violated?
In the crime of plunder, it is enough that the acts defining malversation
or bribery are described. The court then proceeds to determine whether
the acts fall under the prohibitory terms of the law. Criminal intent no
longer has to be proved. The criminal intent to commit the crime is not
required to be proved. The desire to benefit particular persons does not
have to spring from criminal intent under the special law creating the
crime of plunder. In malversation or bribery under the Revised Penal
Code, the criminal intent is an important element of the criminal acts.
Under the Plunder Law, it is enough that the acts are committed.
Thus, even if the accused can prove lack of criminal intent with respect
to crimes mala in se, this will not exonerate him under the crime mala
prohibita. This violates substantive due process and the standards of
fair play because mens rea is a constitutional guarantee under the due
process clause. Indeed, as stated by the U.S. Supreme Court in
Morisette v. U.S.:16
The Government asks us by a feat of construction radically to change
the weights and balances in the scales of justice. The purpose and
obvious effect of doing away with the requirement of a guilty
intent is to ease the prosecution’s party to conviction, to strip the
defendant of such benefit as he derived at common law from
innocence of evil purpose, and to circumscribe the freedom
heretofore allowed juries. Such a manifest impairment of the
immunities of the individual should not be extended to common
law crimes on judicial initiative. (Emphasis ours)
By grafting several felonies, some mala in se and some mala prohibita,
to constitute the crime of plunder and by doing away with the standard
of proof beyond reasonable doubt for the component elements, the
State would practically be given the judicial imprimatur to impose the
extreme penalty of death on the basis of proof only of the overall
pattern of overt or criminal acts showing unlawful scheme or
conspiracy. This attempt of Congress to tip the scales of criminal justice
in favor of the state by doing away with the element of mens rea and to
pave the way for the accused to be convicted by depriving him of the
defense of criminal intent as to mala in se components of plunder will
be anathema to substantive due process which insures "respect for
those personal immunities which are so rooted in the traditions and
conscience of our people as to be ranked as fundamental." 17
Equally disagreeable is the provision of the Plunder Law which does
away with the requirement that each and every component of the
criminal act of plunder be proved and instead limits itself to proving only
a pattern of overt acts indicative of the unlawful scheme or conspiracy. 18
In effect, the law seeks to penalize the accused only on the basis of a
proven scheme or conspiracy, and does away with the rights of the
accused insofar as the component crimes are concerned. In other
words, R.A. No. 7080 circumvents the obligation of the prosecution to
prove beyond reasonable doubt every fact necessary to constitute the
crime of plunder, because the law requires merely proof of a pattern of
overt acts showing an unlawful scheme or conspiracy. What aggravates
matters on this point is that under controlling case law, conspiracy to
defraud is not punishable under the Revised Penal Code. 19 Cutting
corners on the burden of proof is unconstitutional because the standard
of reasonable doubt is part of the due process safeguard accorded an
accused. The due process clause protects the accused against
conviction except upon proof beyond a reasonable doubt of every fact
necessary to constitute the crime with which he is charged. 20
Under R.A. 7659, plunder is a heinous crime punishable by death. It is
described as grievous, odious and hateful because of its inherent or
magnified wickedness, viciousness, atrocity, and perversity. There can
be no quarrel with the legislative objective of reducing the upsurge of
such crimes which affect sustainable economic development and
undermine the people’s faith in Government and the latter’s ability to
maintain peace and order. Nevertheless, due process commands that
even though the governmental purpose is legitimate and substantial,
that purpose cannot be pursued by means so vague and broad that
they infringe on life or stifle liberty when the end can be more narrowly
achieved through existing penal statutes.
Where the statute has an overbroad sweep just as when it is vague, the
hazard of loss or impairment of life or liberty is critical. 21
The problem of vagueness is reduced or eliminated if the different
schemes mentioned in the law as used in the acquisition of ill-gotten
wealth are prosecuted under existing penal law. The offenses are by
their nature distinct and separate from each other and have acquired
established meanings.
Thus, the acts of misappropriation or malversation may be prosecuted
as separate offenses. So may the receipt of commissions, gifts, or
kickbacks by higher officials in connection with government contracts.
The four other methods or schemes mentioned in the law may be the
objects of separate penal statutes.
When the law creates a new crime of plunder through a combination or
series of overt or criminal acts, the courts have to supply missing
elements if conviction is to be achieved.
Bribery is punished as plunder under the law only when there is a
combination or series of criminal acts. But when do certain acts
constitute a combination or series? Does the Plunder law provide that
two or three acts of one crime of bribery constitute a combination or
series which qualify bribery into plunder? Or does bribery have to be
conjoined with the separate offense of malversation to become a
combination? Or with malversation and fraudulent conveyance or
disposition of public assets or one of the other means or schemes
before it becomes a series?
I find it difficult to accept the wide discretion given to the prosecution by
the Plunder Law. An elective official who is a political threat may be
charged for plunder as one single offense punishable by death while
one in the good graces of the powers-that-be is charged only under the
Revised Penal Code.
The confusion generated by a vague law is exemplified in the
informations filed against petitioner in this case. Petitioner was charged
with eight crimes, namely: [1] plunder; [2] violation of Section 3 (e) of
R.A. 3019; [3] violation of Section 3 (a) of R.A. 3019; [4] another
violation of Section 3 (e) of R.A. 3019; [5] violation of Section 3 (c) of
R.A. 3019; [6] violation of Section 7 (d) of R.A. 6713; [7] perjury; [8]
illegal use of alias.
Only twelve days later, the prosecution withdrew five (5) of the
informations which it consolidated into only one offense of plunder. The
prosecution was not clear about the steps to take in instances where
the words "combination" or "series" may or may not apply. It could not
understand the coverage of the law as acts repetitive of the same
offense or acts constituting one crime lumped up with other crimes or
both criminal and non-criminal acts punished as one new offense of
plunder.
In the following exchange during the deliberations on Senate Bill No.
733, Senators Neptali Gonzales and Wigberto Tanada voiced serious
doubts on the constitutionality of the definition of plunder, thus:
Senator Gonzales:
To commit the offense of plunder, as defined in this act, and while
constituting a single offense, it must consist of a series of overt or
criminal acts, such as bribery, extortion, malversation of public funds,
swindling, falsification of public documents, coercion, theft, fraud, and
illegal exaction and graft or corrupt practices and like offenses. Now,
Mr. President, I think this provision, by itself will be vague. I am
afraid that it may be faulted for being violative of the due process
clause and the right to be informed of the nature and cause of
accusation of an accused. Because what is meant by "series of
overt or criminal acts?" I mean, would 2, 4, or 5 constitute a
series? During the period of amendments, can we establish a minimum
of overt acts like, for example, robbery in band? The law defines what is
robbery in band by the number of participants therein. In this particular
case, probably, we can statutorily provide for the definition of
"series" so that two, for example, would that already be a series?
Or, three, what would be the basis for such determination?
Senator Tanada:
I think, Mr. President, that would be called for, this being a penal
legislation, we should be very clear as to what it encompasses;
otherwise, we may contravene the constitutional provision on the
right of accused to due process. (Emphasis ours)22
The foregoing concerns to statutorily provide for the definition of
"series" or "combination" have, however, not been addressed and the
terms were left undefined. The law, as presently crafted, does not
specify whether a "series" means two, three, four or even more of the
overt or criminal acts listed in Section 1 (d) of R.A. 7080.
Even more difficult to accept is when the trial court has to supply the
missing elements, in effect taking over corrective or punitive legislation
from Congress. The attempts of the Sandiganbayan in the questioned
Resolution do not clarify. They instead serve to confuse and increase
the ambiguity even more.
The Sandiganbayan interprets the words "combination" and "series" of
overt or criminal acts through terms found in American decisions like
"pattern," "conspiracy," "over-all unlawful scheme," or "general plan of
action or method."
The above definitions are not found in the Plunder Law. The use of
such phrases as "over-all scheme" or "general plan" indicates that the
Sandiganbayan is expanding the coverage of the law through the use
of ambiguous phrases capable of dual or multiple applications. When
do two or three acts of the same offense of malversation constitute a
"pattern," "a general plan of action," or an "over-all scheme?" Would
one malversation in the first week of a public officer’s tenure and
another similar act six (6) years later become a "combination," a
"pattern," or a "general plan of action?"
I agree with petitioner’s concern over the danger that the trial court may
allow the specifications of details in an information to validate a statute
inherently void for vagueness. An information cannot rise higher than
the statute upon which it is based. Not even the construction by the
Sandiganbayan of a vague or ambiguous provision can supply the
missing ingredients of the Plunder Law.
The right of an accused to be informed of the nature and cause of the
accusation against him is most often exemplified in the care with which
a complaint or information should be drafted. However, the clarity and
particularity required of an information should also be present in the law
upon which the charges are based. If the penal law is vague, any
particularity in the information will come from the prosecutor. The
prosecution takes over the role of Congress.
The fact that the details of the charges are specified in the Information
will not cure the statute of its constitutional infirmity. If on its face the
challenged provision is repugnant to the due process clause,
specification of details of the offense intended to be charged would not
serve to validate it. 23 In other words, it is the statute, not the accusation
under it, that prescribes the rule to govern conduct and warns against
transgression. No one may be required at peril of life, liberty or property
to speculate as to the meaning of penal statutes. All are entitled to be
informed as to what the State commands or forbids.24
Definiteness is a due process requirement. It is especially important in
its application to penal statutes. Vagueness and unintelligibility will
invariably lead to arbitrary government action. The purpose of the due
process clause is to exclude everything that is arbitrary and capricious
affecting the rights of the citizen. 25 Congress, in exercising its power to
declare what acts constitute a crime, must inform the citizen with
reasonable precision what acts it intends to prohibit so that he may
have a certain understandable rule of conduct and know what acts it is
his duty to avoid.26
The questioned statutes were enacted purportedly in the interest of
justice, public peace and order, and the rule of law. These purposes are
not served by R.A. Nos. 7080 and 7659. These statutes allow the
prosecutors and the courts arbitrary and too broad discretionary powers
in their enforcement. Fair, equal and impartial justice would be denied.
For all the foregoing reasons, I vote to grant the petition and nullify the
Plunder Law for being unconstitutional.
MENDOZA, J., concurring in the judgment:
Before I explain my vote, I think it necessary to restate the basic facts.
Petitioner Joseph Ejercito Estrada was President of the Philippines until
January 20, 2001 when he was forced to vacate the presidency by
people power and then Vice President Gloria Macapagal-Arroyo
succeeded him in office.1 He was charged, in eight cases filed with the
Sandiganbayan, with various offenses committed while in office, among
them plunder, for allegedly having amassed ill-gotten wealth in the
amount of P4.1 billion, more or less. He moved to quash the
information for plunder on the ground that R.A. No. 7080, otherwise
called the Anti-Plunder Law, is unconstitutional and that the information
charges more than one offense.
In its resolution dated July 9, 2001, the Sandiganbayan denied
petitioner’s motion, along with those filed by his co-accused, Edward
Serapio, and his son, Jose "Jinggoy" Estrada. Petitioner brought this
petition for certiorari and prohibition under Rule 65 to set aside the
Sandiganbayan’s resolution principally on the ground that the Anti-
Plunder Law is void for being vague and overbroad. We gave due
course to the petition and required respondents to file comments and
later heard the parties in oral arguments on September 18, 2001 and
on their memoranda filed on September 28, 2001 to consider the
constitutional claims of petitioner.
I. THE ANTI-PLUNDER LAW
The Anti-Plunder Law (R.A. No. 7080) was enacted by Congress on
July 12, 1991 pursuant to the constitutional mandate that "the State
shall maintain honesty and integrity in the public service and take
positive and effective measures against graft and corruption." 2 Section
2 of the statute provides:
Definition of the Crime of Plunder; Penalties. ¾ Any public officer who,
by himself or in connivance with members of his family, relatives by
affinity or consanguinity, business associates, subordinates or other
persons, amasses, accumulates or acquires ill-gotten wealth through a
combination or series of overt or criminal acts as described in Section
1(d) hereof in the aggregate amount or total value of at least Fifty
million pesos (P50,000,000.00) shall be guilty of the crime of plunder
and shall be punished by reclusion perpetua to death. Any person who
participated with the said public officer in the commission of an offense
contributing to the crime of plunder shall likewise be punished for such
offense. In the imposition of penalties, the degree of participation and
the attendance of mitigating and extenuating circumstances, as
provided by the Revised Penal Code, shall be considered by the court.
The court shall declare any and all ill-gotten wealth and their interests
and other incomes and assets including the properties and shares of
stocks derived from the deposit or investment thereof forfeited in favor
of the State. (As amended by Sec. 12, R.A. No. 7659).
The term "ill-gotten wealth" is defined in §1(d) as follows:
"Ill-gotten wealth," means any asset, property, business enterprise or
material possession of any person within the purview of Section Two
(2) hereof, acquired by him directly or indirectly through dummies,
nominees, agents, subordinates and/or business associates by any
combination or series of the following means or similar schemes:
1) Through misappropriation, conversion, misuse, or
malversation of public funds or raids on the public treasury.
2) By receiving, directly or indirectly, any commission, gift,
share, percentage, kickbacks or any other form of pecuniary
benefit from any person and/or entity in connection with any
government contract or project or by reason of the office or
position of the public officer concerned;
3) By the illegal or fraudulent conveyance or disposition of
assets belonging to the National Government or any of its
subdivisions, agencies or instrumentalities or government-
owned or controlled corporations and their subsidiaries.
4) By obtaining, receiving or accepting directly or indirectly
any shares of stock, equity or any other form of interest or
participation including the promise of future employment in
any business enterprise or undertaking;
5) By establishing agricultural, industrial or commercial
monopolies or other combinations and/or implementation of
decrees and orders intended to benefit particular persons or
special interests; or
6) By taking undue advantage of official position, authority,
relationship, connection or influence to unjustly enrich himself
or themselves at the expense and to the damage and
prejudice of the Filipino people and the Republic of the
Philippines.
Section 4 of the said law states:
Rule of Evidence. ¾ For purposes of establishing the crime of plunder,
it shall not be necessary to prove each and every criminal act done by
the accused in furtherance of the scheme or conspiracy to amass,
accumulate or acquire ill-gotten wealth, it being sufficient to establish
beyond reasonable doubt a pattern of overt or criminal acts indicative of
the overall unlawful scheme or conspiracy.
II. ANTI-PLUNDER LAW NOT TO BE JUDGED
"ON ITS FACE"
The amended information against petitioner charges violations of §2, in
relation to §1(d)(1)(2), of the statute. It reads:
AMENDED INFORMATION
The undersigned Ombudsman Prosecutor and OIC-Director, EPIB,
Office of the Ombudsman, hereby accuses former President of the
Republic of the Philippines, Joseph Ejercito Estrada a.k.a "Asiong
Salonga" and a.k.a "Jose Velarde," together with Jose "Jinggoy"
Estrada, Charlie "Atong" Ang, Edward Serapio, Yolanda T. Ricaforte,
Alma Alfaro, John Doe a.k.a. Eleuterio Tan or Eleuterio Ramos Tan or
Mr. Uy, Jane Doe a.k.a. Delia Rajas, and John Does & Jane Does, of
the crime of plunder, defined and penalized under R.A. No. 7080, as
amended by Sec. 12 of R.A. No. 7659, committed as follows:
That during the period from June, 1998 to January, 2001, in the
Philippines, and within the jurisdiction of this Honorable Court, accused
Joseph Ejercito Estrada, then a public officer, being then the President
of the Republic of the Philippines, by himself and/or in
connivance/conspiracy with his co-accused, who are members of his
family, relatives by affinity or consanguinity, business associates,
subordinates and/or other persons, by taking undue advantage of his
official position, authority, relationship, connection, or influence, did
then and there wilfully, unlawfully and criminally amass, accumulate
and acquire by himself, directly or indirectly, ill-gotten wealth in the
aggregate amount or total value of four billion ninety seven million eight
hundred four thousand one hundred seventy three pesos and
seventeen centavos [₱4,097,804,173.17], more or less, thereby
unjustly enriching himself or themselves at the expense and to the
damage of the Filipino people and the Republic of the Philippines,
through any or a combination or a series of overt or criminal acts, or
similar schemes or means, described as follows:
(a) by receiving or collecting, directly or indirectly, on several
instances, money in the aggregate amount of five hundred
forty-five million pesos (₱545,000,000.00), more or less, from
illegal gambling in the form of gift, share, percentage,
kickback or any form of pecuniary benefit, by himself and/or in
connivance with co-accused Charlie "Atong" Ang, Jose
"Jinggoy" Estrada, Yolanda T. Ricaforte, Edward Serapio, and
John Does and Jane Does, in consideration of toleration or
protection of illegal gambling;
(b) by diverting, receiving, misappropriating, converting or
misusing directly or indirectly, for his or their personal gain
 and benefit, public funds in the amount of ONE HUNDRED
THIRTY MILLION PESOS [₱130,000,000.00], more or less,
representing a portion of the two hundred million pesos
[₱200,000,000.00] tobacco excise tax share allocated for the
Province of Ilocos Sur under R.A. No. 7171, by himself and/or
in connivance with co-accused Charlie "Atong" Ang, Alma
Alfaro, John Doe a.k.a. Eleuterio Tan or Eleuterio Ramos Tan
or Mr. Uy, and Jane Doe a.k.a. Delia Rajas, and other John
Does and Jane Does;
(c) by directing, ordering and compelling, for his personal gain
and benefit, the Government Service Insurance System
(GSIS) to purchase 351,878,000 shares of stocks, more or
less, and the Social Security System (SSS), 329,855,000
shares of stocks, more or less, of the Belle Corporation in the
amount of more or less one billion one hundred two million
nine hundred sixty five thousand six hundred seven pesos
and fifty centavos [₱1,102,965,607.50] and more or less
seven hundred forty four million six hundred twelve thousand
and four hundred fifty pesos [₱744,612,450.00], respectively,
or a total of more or less one billion eight hundred forty seven
million five hundred seventy eight thousand fifty seven pesos
and fifty centavos [₱1,847,578,057.50]; and by collecting or
receiving, directly or indirectly, by himself and/or in
connivance with John Does and Jane Does, commissions or
percentages by reason of said purchases of shares of stock in
the amount of one hundred eighty nine million seven hundred
thousand pesos [₱189,700,000.00], more or less, from the
Belle Corporation which became part of the deposit in the
Equitable-PCI Bank under the account name "Jose Velarde";
(d) by unjustly enriching himself from commissions, gifts,
shares, percentages, kickbacks, or any form of pecuniary
benefits, in connivance with John Does and Jane Does, in the
amount of more or less three billion two hundred thirty three
million one hundred four thousand one hundred seventy three
pesos and seventeen centavos [₱3,233,104,173.17] and
depositing the same under his account name "Jose Velarde"
at the Equitable-PCI Bank.
CONTRARY TO LAW.
Manila for Quezon City, Philippines, 18 April 2001
But, although this is a prosecution under §2, in relation to §1(d)(1)(2),
what we are seeing here is a wholesale attack on the validity of the
entire statute. Petitioner makes little effort to show the alleged invalidity
of the statute as applied to him. His focus is instead on the statute as a
whole as he attacks "on their face" not only §§1(d)(1)(2) of the statute
but also its other provisions which deal with plunder committed by
illegal or fraudulent disposition of government assets (§1(d)(3)),
acquisition of interest in business (§1(d)(4)), and establishment of
monopolies and combinations or implementation of decrees intended to
benefit particular persons or special interests (§1(d)(5)).
These other provisions of the statute are irrelevant to this case. What
relevance do questions regarding the establishment of monopolies and
combinations, or the ownership of stocks in a business enterprise, or
the illegal or fraudulent dispositions of government property have to the
criminal prosecution of petitioner when they are not even mentioned in
the amended information filed against him? Why should it be important
to inquire whether the phrase "overt act" in §1(d) and §2 means the
same thing as the phrase "criminal act" as used in the same provisions
when the acts imputed to petitioner in the amended information are
criminal acts? Had the provisions of the Revised Penal Code been
subjected to this kind of line-by-line scrutiny whenever a portion thereof
was involved in a case, it is doubtful if we would have the jurisprudence
on penal law that we have today. The prosecution of crimes would
certainly have been hampered, if not stultified. We should not even
attempt to assume the power we are asked to exercise. "The delicate
power of pronouncing an Act of Congress unconstitutional is not to be
exercised with reference to hypothetical cases . . . . In determining the
sufficiency of the notice a statute must of necessity be examined in the
light of the conduct with which a defendant is charged." 3
Nonetheless, it is contended that because these provisions are void for
being vague and overbroad, the entire statute, including the part under
which petitioner is being prosecuted, is also void. And if the entire
statute is void, there is no law under which he can be prosecuted for
plunder. Nullum crimen sine lege, nullum poena sine lege.
Two justifications are advanced for this facial challenge to the validity of
the entire statute. The first is that the statute comes within the specific
prohibitions of the Constitution and, for this reason, it must be given
strict scrutiny and the normal presumption of constitutionality should not
be applied to it nor the usual judicial deference given to the judgment of
Congress.4 The second justification given for the facial attack on the
Anti-Plunder Law is that it is vague and overbroad. 5
We find no basis for such claims either in the rulings of this Court or of
those of the U.S. Supreme Court, from which petitioner’s counsel
purports to draw for his conclusions. We consider first the claim that the
statute must be subjected to strict scrutiny.
A. Test of Strict Scrutiny Not Applicable to Penal Statutes
Petitioner cites the dictum in Ople v. Torres6 that "when the integrity of
a fundamental right is at stake, this Court will give the challenged law,
administrative order, rule or regulation stricter scrutiny" and that "It will
not do for authorities to invoke the presumption of regularity in the
performance of official duties." As will presently be shown, "strict
scrutiny," as used in that decision, is not the same thing as the "strict
scrutiny" urged by petitioner. Much less did this Court rule that because
of the need to give "stricter scrutiny" to laws abridging fundamental
freedoms, it will not give such laws the presumption of validity.
Petitioner likewise cites "the most celebrated footnote in [American]
constitutional law," i.e., footnote 4 of the opinion in United States v.
Carolene Products Co.,7 in which it was stated:
There may be narrower scope for operation of the presumption of
constitutionality when legislation appears on its face to be within a
specific prohibition of the Constitution, such as those of the first ten
amendments, which are deemed equally specific when held to be
embraced within the Fourteenth.
It is unnecessary to consider now whether legislation which restricts
those political processes which can ordinarily be expected to bring
about repeal of undesirable legislation, is to be subjected to more
exacting judicial scrutiny under the general prohibitions of the
Fourteenth Amendment than are most other types of legislation.
Nor need we inquire whether similar considerations enter into the
review of statutes directed at particular religious, or national, or racial
minorities: whether prejudice against discrete and insular minorities
may be a special condition, which tends seriously to curtail the
operation of those political processes ordinarily to be relied upon to
protect minorities, and which may call for a correspondingly more
searching judicial inquiry.
Again, it should be noted that what the U.S. Supreme Court said is that
"there may be narrower scope for the operation of the presumption of
constitutionality" for legislation which comes within the first ten
amendments to the American Federal Constitution compared to
legislation covered by the Fourteenth Amendment Due Process Clause.
The American Court did not say that such legislation is not to be
presumed constitutional, much less that it is presumptively invalid, but
only that a "narrower scope" will be given for the presumption of
constitutionality in respect of such statutes. There is, therefore, no
warrant for petitioner’s contention that "the presumption of
constitutionality of a legislative act is applicable only where the
Supreme Court deals with facts regarding ordinary economic affairs,
not where the interpretation of the text of the Constitution is involved." 8
What footnote 4 of the Carolene Products case posits is a double
standard of judicial review: strict scrutiny for laws dealing with freedom
of the mind or restricting the political process, and deferential or rational
basis standard of review for economic legislation. As Justice (later
Chief Justice) Fernando explained in Malate Hotel and Motel Operators
Ass’n v. The City Mayor,9 this simply means that "if the liberty involved
were freedom of the mind or the person, the standard for the validity of
governmental acts is much more rigorous and exacting, but where the
liberty curtailed affects what are at the most rights of property, the
permissible scope of regulatory measures is wider."
Hence, strict scrutiny is used today to test the validity of laws dealing
with the regulation of speech, gender, or race and facial challenges are
allowed for this purpose. But criminal statutes, like the Anti-Plunder
Law, while subject to strict construction, are not subject to strict
scrutiny. The two (i.e., strict construction and strict scrutiny) are not the
same. The rule of strict construction is a rule of legal hermeneutics
which deals with the parsing of statutes to determine the intent of the
legislature. On the other hand, strict scrutiny is a standard of judicial
review for determining the quality and the amount of governmental
interest brought to justify the regulation of fundamental freedoms. It is
set opposite such terms as "deferential review" and "intermediate
review."
Thus, under deferential review, laws are upheld if they rationally further
a legitimate governmental interest, without courts seriously inquiring
into the substantiality of such interest and examining the alternative
means by which the objectives could be achieved. Under intermediate
review, the substantiality of the governmental interest is seriously
looked into and the availability of less restrictive alternatives are
considered. Under strict scrutiny, the focus is on the presence of
compelling, rather than substantial, governmental interest and on the
absence of less restrictive means for achieving that interest. 10
Considering these degrees of strictness in the review of statutes, how
many criminal laws can survive the test of strict scrutiny to which
petitioner proposes to subject them? How many can pass muster if, as
petitioner would have it, such statutes are not to be presumed
constitutional? Above all, what will happen to the State’s ability to deal
with the problem of crimes, and, in particular, with the problem of graft
and corruption in government, if criminal laws are to be upheld only if it
is shown that there is a compelling governmental interest for making
certain conduct criminal and if there is no other means less restrictive
than that contained in the law for achieving such governmental
interest?
B. Vagueness and Overbreadth Doctrines, as Grounds for Facial
Challenge,
Not Applicable to Penal Laws
Nor do allegations that the Anti-Plunder Law is vague and overbroad
justify a facial review of its validity. The void-for-vagueness doctrine
states that "a statute which either forbids or requires the doing of an act
in terms so vague that men of common intelligence must necessarily
guess at its meaning and differ as to its application, violates the first
essential of due process of law." 11 The overbreadth doctrine, on the
other hand, decrees that "a governmental purpose may not be achieved
by means which sweep unnecessarily broadly and thereby invade the
area of protected freedoms."12
A facial challenge is allowed to be made to a vague statute and to one
which is overbroad because of possible "chilling effect" upon protected
speech. The theory is that "[w]hen statutes regulate or proscribe
speech and no readily apparent construction suggests itself as a
vehicle for rehabilitating the statutes in a single prosecution, the
transcendent value to all society of constitutionally protected expression
is deemed to justify allowing attacks on overly broad statutes with no
requirement that the person making the attack demonstrate that his
own conduct could not be regulated by a statute drawn with narrow
specificity."13 The possible harm to society in permitting some
unprotected speech to go unpunished is outweighed by the possibility
that the protected speech of others may be deterred and perceived
grievances left to fester because of possible inhibitory effects of overly
broad statutes.
This rationale does not apply to penal statutes. Criminal statutes have
general in terrorem effect resulting from their very existence, and, if
facial challenge is allowed for this reason alone, the State may well be
prevented from enacting laws against socially harmful conduct. In the
area of criminal law, the law cannot take chances as in the area of free
speech.
The overbreadth and vagueness doctrines then have special
application only to free speech cases. They are inapt for testing the
validity of penal statutes. As the U.S. Supreme Court put it, in an
opinion by Chief Justice Rehnquist, "we have not recognized an
‘overbreadth’ doctrine outside the limited context of the First
Amendment."14 In Broadrick v. Oklahoma,15 the Court ruled that "claims
of facial overbreadth have been entertained in cases involving statutes
which, by their terms, seek to regulate only spoken words" and, again,
that "overbreadth claims, if entertained at all, have been curtailed when
invoked against ordinary criminal laws that are sought to be applied to
protected conduct." For this reason, it has been held that "a facial
challenge to a legislative Act is … the most difficult challenge to mount
successfully, since the challenger must establish that no set of
circumstances exists under which the Act would be valid." 16 As for the
vagueness doctrine, it is said that a litigant may challenge a statute on
its face only if it is vague in all its possible applications. "A plaintiff who
engages in some conduct that is clearly proscribed cannot complain of
the vagueness of the law as applied to the conduct of others."17
In sum, the doctrines of strict scrutiny, overbreadth, and vagueness are
analytical tools developed for testing "on their faces" statutes in free
speech cases or, as they are called in American law, First Amendment
cases. They cannot be made to do service when what is involved is a
criminal statute. With respect to such statute, the established rule is
that "one to whom application of a statute is constitutional will not be
heard to attack the statute on the ground that impliedly it might also be
taken as applying to other persons or other situations in which its
application might be unconstitutional."18 As has been pointed out,
"vagueness challenges in the First Amendment context, like
overbreadth challenges typically produce facial invalidation, while
statutes found vague as a matter of due process typically are
invalidated [only] ‘as applied’ to a particular defendant." 19 Consequently,
there is no basis for petitioner’s claim that this Court review the Anti-
Plunder Law on its face and in its entirety.
C. Anti-Plunder Law Should be Construed "As Applied"
Indeed, "on its face" invalidation of statutes results in striking them
down entirely on the ground that they might be applied to parties not
before the Court whose activities are constitutionally protected. 20 It
constitutes a departure from the case and controversy requirement of
the Constitution and permits decisions to be made without concrete
factual settings and in sterile abstract contexts. 21 But, as the U.S.
Supreme Court pointed out in Younger v. Harris:22
[T]he task of analyzing a proposed statute, pinpointing its deficiencies,
and requiring correction of these deficiencies before the statute is put
into effect, is rarely if ever an appropriate task for the judiciary. The
combination of the relative remoteness of the controversy, the impact
on the legislative process of the relief sought, and above all the
speculative and amorphous nature of the required line-by-line analysis
of detailed statutes,...ordinarily results in a kind of case that is wholly
unsatisfactory for deciding constitutional questions, whichever way they
might be decided.
This is the reason "on its face" invalidation of statutes has been
described as "manifestly strong medicine," to be employed "sparingly
and only as a last resort," 23 and is generally disfavored. 24 In determining
the constitutionality of a statute, therefore, its provisions which are
alleged to have been violated in a case must be examined in the light of
the conduct with which the defendant is charged. 25
This brings me to the question whether, as applied, §2, in relation to
§1(d)(1)(2), of the Anti-Plunder Law is void on the ground of vagueness
and overbreadth.
III. ANTI-PLUNDER LAW NEITHER VAGUE NOR OVERBROAD
As earlier noted, the case against petitioner Joseph Ejercito Estrada in
the Sandiganbayan is for violation of §2, in relation to §1(d)(1)(2), of the
Anti-Plunder Law, which, so far as pertinent, provide:
SEC. 2. Definition of the Crime of Plunder; Penalties. ¾ Any public
officer who, by himself or in connivance with members of his family,
relatives by affinity or consanguinity, business associates, subordinates
or other persons, amasses, accumulates or acquires ill-gotten wealth
through a combination or series of overt or criminal acts as described in
Section 1(d) hereof in the aggregate amount or total value of at least
Fifty million pesos (P50,000,000.00) shall be guilty of the crime of
plunder and shall be punished by reclusion perpetua to death....
SEC. 1. Definition of Terms. ¾ ...
(d) "Ill-gotten wealth," means any asset, property, business enterprise
or material possession of any person within the purview of Section Two
(2) hereof, acquired by him directly or indirectly through dummies,
nominees, agents, subordinates and/or business associates by any
combination or series of the following means or similar schemes:
1) Through misappropriation, conversion, misuse, or
malversation of public funds or raids on the public treasury.
2) By receiving, directly or indirectly, any commission, gift,
share, percentage, kickbacks or any other form of pecuniary
benefit from any person and/or entity in connection with any
government contract or project or by reason of the office or
position of the public officer concerned;
The charge is that in violation of these provisions, during the period
June 1998 to January 2001, petitioner, then the President of the
Philippines, willfully, unlawfully, and criminally amassed wealth in the
total amount of P4,097,804,173.17, more or less, through "a
combination or series of overt or criminal acts," to wit: (1) by receiving
or collecting the total amount of P545,000,000.00, more or less, from
illegal gambling by himself and/or in connivance with his co-accused
named therein, in exchange for protection of illegal gambling; (2) by
misappropriating, converting, or misusing, by himself or in connivance
with his co-accused named therein, public funds amounting to
P130,000,000.00, more or less, representing a portion of the share of
the Province of Ilocos Sur in the tobacco excise tax; (3) by ordering the
GSIS and the SSS to buy shares of stocks of the Belle Corp., worth
P1,102,965,607.50 and P744,612,450.00 respectively, or the total
amount of P1,847,578,057.50, for which he received as commission the
amount of P189,700,000.00, more or less, from Belle Corp.; (4) by
unjustly enriching himself from commissions, gifts, shares,
percentages, and kickbacks in the amount of P3,233,104,173.17, which
he deposited in the Equitable-PCI Bank under the name of "Jose
Velarde."
Anyone reading the law in relation to this charge cannot possibly be
mistaken as to what petitioner is accused of in Criminal Case No.
26558 of the Sandiganbayan. But, repeatedly, petitioner complains that
the law is vague and deprives him of due process. He invokes the
ruling in Connally v. General Constr. Co. 26 that "a statute which either
forbids or requires the doing of an act in terms so vague that men of
common intelligence must necessarily guess at its meaning and differ
as to its application, violates the first essential of due process of law."
He does this by questioning not only §2, in relation to §1(d)(1)(2), as
applied to him, but also other provisions of the Anti-Plunder Law not
involved in this case. In 55 out of 84 pages of discussion in his
Memorandum, petitioner tries to show why on their face these
provisions are vague and overbroad by asking questions regarding the
meaning of some words and phrases in the statute, to wit:
1. Whether "series" means two, three, or four overt or criminal
acts listed in §1(d) in view of the alleged divergence of
interpretation given to this word by the Ombudsman, the
Solicitor General, and the Sandiganbayan, and whether the
acts in a series should be directly related to each other;
2. Whether "combination" includes two or more acts or at
least two of the "means or similar schemes" mentioned in
§1(d);
3. Whether "pattern" as used in §1(d) must be related to the
word "pattern" in §4 which requires that it be "indicative of an
overall unlawful scheme or conspiracy";
4. Whether "overt" means the same thing as "criminal";
5. Whether "misuse of public funds" is the same as "illegal
use of public property or technical malversation";
6. Whether "raids on the public treasury" refers to raids on the
National Treasury or the treasury of a province or
municipality;
 7. Whether the receipt or acceptance of a gift, commission,
kickback, or pecuniary benefits in connection with a
government contract or by reason of his office, as used in
§1(d)(2), is the same as bribery in the Revised Penal Code or
those which are considered corrupt practices of public
officers;
8. Whether "illegal or fraudulent conveyance or disposition of
assets belonging to the National Government," as used in
§1(d)(3), refers to technical malversation or illegal use of
public funds or property in the Revised Penal Code;
9. Whether mere ownership of stocks in a private corporation,
such as a family firm engaged in fishing, is prohibited under
§1(d)(4);
10. Whether the phrase "monopolies or other combinations in
restraint of trade" in §1(d)(5) means the same thing as
"monopolies and combinations in restraint of trade" in the
Revised Penal Code because the latter contemplates
monopolies and combinations established by any person, not
necessarily a public officer; and
11. Whether under §1(d)(5) it is the public officer who intends
to confer benefit on a particular person by implementing a
decree or it is the decree that is intended to benefit the
particular person and the public officer simply implements it.
Many more questions of this tenor are asked in the memorandum of
petitioner27 as well as in the dissent of MR. JUSTICE KAPUNAN. Not
only are they irrelevant to this case, as already pointed out. It is also
evident from their examination that what they present are simply
questions of statutory construction to be resolved on a case-to-case
basis. Consider, for example, the following words and phrases in §1(d)
and §2:
A. "Combination or series of overt or criminal acts"
Petitioner contends that the phrase "combination or series of overt, or
criminal acts" in §1(d) and §2 should state how many acts are needed
in order to have a "combination" or a "series." It is not really required
that this be specified. Petitioner, as well as MR. JUSTICE KAPUNAN,
cites the following remarks of Senators Gonzales and Tañada during
the discussion of S. No. 733 in the Senate:
SENATOR GONZALES. To commit the offense of plunder, as defined
in this Act while constituting a single offense, it must consist of a series
of overt or criminal acts, such as bribery, extortion, malversation of
public funds, swindling, falsification of public documents, coercion,
theft, fraud, and illegal exaction, and graft or corrupt practices act and
like offenses. Now, Mr. President, I think, this provision, by itself, will be
vague. I am afraid that it might be faulted for being violative of the due
process clause and the right to be informed of the nature and cause of
accusation of an accused. Because, what is meant by "series of overt
or criminal acts"? I mean, would 2, 3, 4 or 5 constitute a series? During
the period of amendments, can we establish a minimum of overt acts
like, for example, robbery in band? The law defines what is robbery in
band by the number of participants therein.
In this particular case, probably, we can statutorily provide for the
definition of "series" so that two, for example, would that be already a
series? Or, three, what would be the basis for such a determination?
SENATOR TAÑADA. I think, Mr. President, that would be called for,
this being a penal legislation, we should be very clear as to what it
encompasses; otherwise, we may contravene the constitutional
provision on the right of the accused to due process.28
But, as the later discussion in the Senate shows, the senators in the
end reached a consensus as to the meaning of the phrase so that an
enumeration of the number of acts needed was no longer proposed.
Thus, the record shows:
SENATOR MACEDA. In line with our interpellations that sometimes
"one" or maybe even "two" acts may already result in such a big
amount, on line 25, would the Sponsor consider deleting the words "a
series of overt or." To read, therefore: "or conspiracy COMMITTED by
criminal acts such." Remove the idea of necessitating "a series."
Anyway, the criminal acts are in the plural.
SENATOR TAÑADA. That would mean a combination of two or more of
the acts mentioned in this.
THE PRESIDENT. Probably, two or more would be . . .
SENATOR MACEDA. Yes, because "a series" implies several or many;
two or more.
SENATOR TAÑADA: Accepted, Mr. President.
....
THE PRESIDENT: If there is only one, then he has to be prosecuted
under the particular crime. But when we say "acts of plunder" there
should be, at least, two or more.
SENATOR ROMULO: In other words, that is already covered by
existing laws, Mr. President.29
Indeed, the record shows that no amendment to S. No. 733 was
proposed to this effect. To the contrary, Senators Gonzales and
Tañada voted in favor of the bill on its third and final reading on July 25,
1989. The ordinary meaning of the term "combination" as the "union of
two things or acts" was adopted, although in the case of "series," the
senators agreed that a repetition of two or more times of the same thing
or act would suffice, thus departing from the ordinary meaning of the
word as "a group of usually three or more things or events standing or
succeeding in order and having a like relationship to each other," or "a
spatial or temporal succession of persons or things," or "a group that
has or admits an order of arrangement exhibiting progression."30
In the Bicameral Conference Committee on Justice meeting held on
May 7, 1991, the same meanings were given to the words
"combination" and "series." Representative Garcia explained that a
combination is composed of two or more of the overt or criminal acts
enumerated in §1(d), while a series is a repetition of any of the same
overt or criminal acts. Thus:
REP. ISIDRO: I am just intrigued again by our definition of plunder. We
say, THROUGH A COMBINATION OR SERIES OF OVERT OR
CRIMINAL ACTS AS MENTIONED IN SECTION ONE HEREOF. Now
when we say combination, we actually mean to say, if there are two or
more means, we mean to say that number one and two or number one
and something else are included, how about a series of the same act?
For example, through misappropriation, conversion, misuse, will these
be included also?
....
REP. ISIDRO: When we say combination, it seems that ¾
THE CHAIRMAN (REP. GARCIA): Two.
REP. ISIDRO: Not only two but we seem to mean that two of the
enumerated means not twice of one enumeration.
THE CHAIRMAN (REP. GARCIA): No, no, not twice.
REP. ISIDRO: Not twice?
THE CHAIRMAN (REP. GARCIA): Yes, combination is not twice ¾ but
combination, two acts.
REP. ISIDRO: So in other words, that’s it. When we say combination,
we mean, two different acts. It can not be a repetition of the same act.
THE CHAIRMAN (REP. GARCIA): That be referred to series. Yeah.
REP. ISIDRO: No, no. Supposing one act is repeated, so there are two.
THE CHAIRMAN (REP. GARCIA): A series.
REP. ISIDRO: That’s not [a] series. It’s a combination. Because when
we say combination or series, we seem to say that two or more, ‘di ba?
THE CHAIRMAN (REP. GARCIA): Yes, this distinguishes it, really, from
ordinary crimes. That is why, I said, that is a very good suggestion
because if it is only one act, it may fall under ordinary crime but we
have here a combination or series of overt or criminal acts. So. . .
....
REP. ISIDRO: When you say "combination", two different?
THE CHAIRMAN (REP. GARCIA): Yes.
THE CHAIRMAN (SEN. TAÑADA): Two different. . . .
REP. ISIDRO: Two different acts.
THE CHAIRMAN (REP. GARCIA): For example, ha. . .
REP. ISIDRO: Now a series, meaning, repetition. . .31
Thus, resort to the deliberations in Congress will readily reveal that the
word "combination" includes at least two different overt or criminal acts
listed in R.A. No. 7080, such as misappropriation (§1(d)(1)) and taking
undue advantage of official position (§1(d)(6)). On the other hand,
"series" is used when the offender commits the same overt or criminal
act more than once. There is no plunder if only one act is proven, even
if the ill-gotten wealth acquired thereby amounts to or exceeds the
figure fixed by the law for the offense (now P50,000,000.00). The overt
or criminal acts need not be joined or separated in space or time, since
the law does not make such a qualification. It is enough that the
prosecution proves that a public officer, by himself or in connivance
with others, amasses wealth amounting to at least P50 million by
committing two or more overt or criminal acts.
Petitioner also contends that the phrase "series of acts or transactions"
is the subject of conflicting decisions of various Circuit Courts of
Appeals in the United Sates. It turns out that the decisions concerned a
phrase in Rule 8(b) of the Federal Rules of Criminal Procedure which
provides:
(b) Joinder of Defendants: Two or more defendants may be charged in
the same indictment or information if they are alleged to have
participated in the same act or transaction or in the same series of acts
or transactions constituting an offense or offenses. Such defendants
may be charged in one or more counts together or separately and all of
the defendants need not be charged on each count. (Emphasis added)
The fact that there is a conflict in the rulings of the various courts does
not mean that Rule 8(b) is void for being vague but only that the U.S.
Supreme Court should step in, for one of its essential functions is to
assure the uniform interpretation of federal laws.
We have a similar provision in Rule 3, §6 of the 1997 Code of Civil
Procedure. It reads:
SEC. 6. Permissive joinder of parties. ¾ All persons in whom or against
whom any right to relief in respect to or arising out of the same
transaction or series of transactions is alleged to exist, whether jointly,
severally, or in the alternative, may, except as otherwise provided in
these Rules, join as plaintiffs or be joined as defendants in one
complaint, where any question of law or fact common to all such
plaintiffs or to all such defendants may arise in the action; but the court
may make such orders as may be just to prevent any plaintiff or
defendant from being embarrassed or put to expense in connection
with any proceedings in which he may have no interest. (Emphasis
added)
This provision has been in our Rules of Court since 1940 but it has
never been thought of as vague. It will not do, therefore, to cite the
conflict of opinions in the United States as evidence of the vagueness
of the phrase when we do not have any conflict in this country.
B. "Pattern of overt or criminal acts"
Petitioner contends that it is not enough that there be at least two acts
to constitute either a combination or series because §4 also mentions
"a pattern of overt or criminal acts indicative of the overall scheme or
conspiracy," and "pattern" means "an arrangement or order of things or
activity."
A "pattern of overt or criminal acts" is required in §4 to prove "an
unlawful scheme or conspiracy." In such a case, it is not necessary to
prove each and every criminal act done in furtherance of the scheme or
conspiracy so long as those proven show a pattern indicating the
scheme or conspiracy. In other words, when conspiracy is charged,
there must be more than a combination or series of two or more acts.
There must be several acts showing a pattern which is "indicative of the
overall scheme or conspiracy." As Senate President Salonga explained,
if there are 150 constitutive crimes charged, it is not necessary to prove
beyond reasonable doubt all of them. If a pattern can be shown by
proving, for example, 10 criminal acts, then that would be sufficient to
secure conviction.32
The State is thereby enabled by this device to deal with several acts
constituting separate crimes as just one crime of plunder by allowing
their prosecution by means of a single information because there is a
common purpose for committing them, namely, that of "amassing,
accumulating or acquiring wealth through such overt or criminal acts."
The pattern is the organizing principle that defines what otherwise
would be discreet criminal acts into the single crime of plunder.
As thus applied to petitioner, the Anti-Plunder Law presents only
problems of statutory construction, not vagueness or overbreadth. In
Primicias v. Fugoso,33 an ordinance of the City of Manila, prohibiting the
holding of parades and assemblies in streets and public places unless
a permit was first secured from the city mayor and penalizing its
violation, was construed to mean that it gave the city mayor only the
power to specify the streets and public places which can be used for
the purpose but not the power to ban absolutely the use of such places.
A constitutional doubt was thus resolved through a limiting construction
given to the ordinance.
Nor is the alleged difference of opinion among the Ombudsman, the
Solicitor General, and the Sandiganbayan as to the number of acts or
crimes needed to constitute plunder proof of the vagueness of the
statute and, therefore, a ground for its invalidation. For sometime it was
thought that under Art. 134 of the Revised Penal Code convictions can
be had for the complex crime of rebellion with murder, arson, and other
common crimes. The question was finally resolved in 1956 when this
Court held that there is no such complex crime because the common
crimes were absorbed in rebellion. 34 The point is that Art. 134 gave rise
to a difference of opinion that nearly split the legal profession at the
time, but no one thought Art. 134 to be vague and, therefore, void.
Where, therefore, the ambiguity is not latent and the legislative intention
is discoverable with the aid of the canons of construction, the void for
vagueness doctrine has no application.
In Connally v. General Constr. Co.35 the test of vagueness was
formulated as follows:
[A] statute which either forbids or requires the doing of an act in terms
so vague that men of common intelligence must necessarily guess at
its meaning and differ as to its application, violates the first essential of
due process of law.
Holmes’s test was that of the viewpoint of the bad man. In The Path of
the Law, Holmes said:
If you want to know the law and nothing else, you must look at it as a
bad man, who cares only for the material consequences which such
knowledge enables him to predict, not as a good one, who finds his
reasons for conduct, whether inside the law or outside of it, in the
vaguer sanctions of conscience.36
Whether from the point of view of a man of common intelligence or from
that of a bad man, there can be no mistaking the meaning of the Anti-
Plunder Law as applied to petitioner.
IV. PLUNDER A COMPLEX CRIME REQUIRING PROOF OF MENS
REA
Petitioner argues that, in enacting the statute in question, Congress
eliminated the element of mens rea, or the scienter, thus reducing the
burden of evidence required for proving the crimes which are mala in
se.37
There are two points raised in this contention. First is the question
whether the crime of plunder is a malum in se or a malum prohibitum.
For if it is a malum prohibitum, as the Ombudsman and the Solicitor
General say it is,38 then there is really a constitutional problem because
the predicate crimes are mainly mala in se.
A. Plunder A Malum In Se Requiring Proof of Mens Rea
Plunder is a malum in se, requiring proof of criminal intent. Precisely
because the constitutive crimes are mala in se the element of mens rea
must be proven in a prosecution for plunder. It is noteworthy that the
amended information alleges that the crime of plunder was committed
"willfully, unlawfully and criminally." It thus alleges guilty knowledge on
the part of petitioner.
In support of his contention that the statute eliminates the requirement
of mens rea and that is the reason he claims the statute is void,
petitioner cites the following remarks of Senator Tañada made during
the deliberation on S. No. 733:
SENATOR TAÑADA. . . . And the evidence that will be required to
convict him would not be evidence for each and every individual
criminal act but only evidence sufficient to establish the conspiracy or
scheme to commit this crime of plunder. 39
However, Senator Tañada was discussing §4 as shown by the
succeeding portion of the transcript quoted by petitioner:
SENATOR ROMULO: And, Mr. President, the Gentleman feels that it is
contained in Section 4, Rule of Evidence, which, in the Gentleman’s
view, would provide for a speedier and faster process of attending to
this kind of cases?
SENATOR TAÑADA. Yes, Mr. President . . .40
Señator Tañada was only saying that where the charge is conspiracy to
commit plunder, the prosecution need not prove each and every
criminal act done to further the scheme or conspiracy, it being enough if
it proves beyond reasonable doubt a pattern of overt or criminal acts
indicative of the overall unlawful scheme or conspiracy. As far as the
acts constituting the pattern are concerned, however, the elements of
the crime must be proved and the requisite mens rea must be shown.
Indeed, §2 provides that ¾
Any person who participated with the said public officer in the
commission of an offense contributing to the crime of plunder shall
likewise be punished for such offense. In the imposition of penalties,
the degree of participation and the attendance of mitigating and
extenuating circumstances, as provided by the Revised Penal Code,
shall be considered by the court.
The application of mitigating and extenuating circumstances in the
Revised Penal Code to prosecutions under the Anti-Plunder Law
indicates quite clearly that mens rea is an element of plunder since the
degree of responsibility of the offender is determined by his criminal
intent. It is true that §2 refers to "any person who participates with the
said public officers in the commission of an offense contributing to the
crime of plunder." There is no reason to believe, however, that it does
not apply as well to the public officer as principal in the crime. As
Justice Holmes said: "We agree to all the generalities about not
supplying criminal laws with what they omit, but there is no canon
against using common sense in construing laws as saying what they
obviously mean."41
Finally, any doubt as to whether the crime of plunder is a malum in se
must be deemed to have been resolved in the affirmative by the
decision of Congress in 1993 to include it among the heinous crimes
punishable by reclusion perpetua to death. Other heinous crimes are
punished with death as a straight penalty in R.A. No. 7659. Referring to
these groups of heinous crimes, this Court held in People v.
Echagaray:42
The evil of a crime may take various forms. There are crimes that are,
by their very nature, despicable, either because life was callously taken
or the victim is treated like an animal and utterly dehumanized as to
completely disrupt the normal course of his or her growth as a human
being. . . . Seen in this light, the capital crimes of kidnapping and
serious illegal detention for ransom resulting in the death of the victim
or the victim is raped, tortured, or subjected to dehumanizing acts;
destructive arson resulting in death; and drug offenses involving minors
or resulting in the death of the victim in the case of other crimes; as well
as murder, rape, parricide, infanticide, kidnapping and serious illegal
detention, where the victim is detained for more than three days or
serious physical injuries were inflicted on the victim or threats to kill him
were made or the victim is a minor, robbery with homicide, rape or
intentional mutilation, destructive arson, and carnapping where the
owner, driver or occupant of the carnapped vehicle is killed or raped,
which are penalized by reclusion perpetua to death, are clearly heinous
by their very nature.
There are crimes, however, in which the abomination lies in the
significance and implications of the subject criminal acts in the scheme
of the larger socio-political and economic context in which the state
finds itself to be struggling to develop and provide for its poor and
underprivileged masses. Reeling from decades of corrupt tyrannical
rule that bankrupted the government and impoverished the population,
the Philippine Government must muster the political will to dismantle
the culture of corruption, dishonesty, greed and syndicated criminality
that so deeply entrenched itself in the structures of society and the
psyche of the populace. [With the government] terribly lacking the
money to provide even the most basic services to its people, any form
of misappropriation or misapplication of government funds translates to
an actual threat to the very existence of government, and in turn, the
very survival of the people it governs over. Viewed in this context, no
less heinous are the effects and repercussions of crimes like qualified
bribery, destructive arson resulting in death, and drug offenses
involving government officials, employees or officers, that their
perpetrators must not be allowed to cause further destruction and
damage to society.
The legislative declaration in R.A. No. 7659 that plunder is a heinous
offense implies that it is a malum in se. For when the acts punished are
inherently immoral or inherently wrong, they are mala in se43 and it does
not matter that such acts are punished in a special law, especially since
in the case of plunder the predicate crimes are mainly mala in se.
Indeed, it would be absurd to treat prosecutions for plunder as though
they are mere prosecutions for violations of the Bouncing Check Law
(B.P. Blg. 22) or of an ordinance against jaywalking, without regard to
the inherent wrongness of the acts.
B. The Penalty for Plunder
The second question is whether under the statute the prosecution is
relieved of the duty of proving beyond reasonable doubt the guilt of the
defendant. It is contended that, in enacting the Anti-Plunder Law,
Congress simply combined several existing crimes into a single one but
the penalty which it provided for the commission of the crime is grossly
disproportionate to the crimes combined while the quantum of proof
required to prove each predicate crime is greatly reduced.
We have already explained why, contrary to petitioner’s contention, the
quantum of proof required to prove the predicate crimes in plunder is
the same as that required were they separately prosecuted. We,
therefore, limit this discussion to petitioner’s claim that the penalty
provided in the Anti-Plunder Law is grossly disproportionate to the
penalties imposed for the predicate crimes. Petitioner cites the following
examples:
For example, please consider the following ‘combination’ or ‘series’ of
overt or criminal acts (assuming the P50 M minimum has been
acquired) in light of the penalties laid down in the Penal Code:
a. One act of indirect bribery (penalized under Art. 211 of the Revised
Penal Code with prision correccional in its medium and maximum
periods),
– combined with –
one act of fraud against the public treasury (penalized under Art. 213 of
the Revised Penal Code with prision correccional in its medium
period to prision mayor in its minimum period,
- equals -
plunder (punished by reclusion perpetua to death plus forfeiture of
assets under R.A. 7080)
b. One act of prohibited transaction (penalized under Art. 215 of the
revised Penal Code with prision correccional in its minimum period or
a fine ranging from P200 to P1,000 or both),
– combined with –
one act of establishing a commercial monopoly (penalized under Art.
186 of Revised Penal Code with prision correccional in its minimum
period or a fine ranging from P200 to P6,000, or both),
-equals-
plunder (punished by reclusion perpetua to death, and forfeiture of
assets under R.A. 7080.
c. One act of possession of prohibited interest by a public officer
(penalized with prision correccional in its minimum period or a fine of
P200 to P1,000, or both under Art. 216 of the Revised Penal Code),
– combined with –
one act of combination or conspiracy in restraint of trade (penalized
under Art. 186 of the Revised penal Code with prision correccional in
its minimum period, or a fine of P200 to P1,000, or both,
- equals -
plunder, punished by reclusion perpetua to death, and forfeiture of
assets)44
But this is also the case whenever other special complex crimes are
created out of two or more existing crimes. For example, robbery with
violence against or intimidation of persons under Art. 294, par. 5 of the
Revised Penal Code is punished with prision correccional in its
maximum period (4 years, 2 months, and 1 day) to prision mayor in its
medium period (6 years and 1 day to 8 years). Homicide under Art. 249
of the same Code is punished with reclusion temporal (12 years and 1
day to 20 years). But when the two crimes are committed on the same
occasion, the law treats them as a special complex crime of robbery
with homicide and provides the penalty of reclusion perpetua to death
for its commission. Again, the penalty for simple rape under Art. 266-B
of the Revised Penal Code is reclusion perpetua, while that for
homicide under Art. 249 it is reclusion temporal (12 years and 1 day to
20 years). Yet, when committed on the same occasion, the two are
treated as one special complex crime of rape with homicide and
punished with a heavier penalty of reclusion perpetua to death.
Obviously, the legislature views plunder as a crime as serious as
robbery with homicide or rape with homicide by punishing it with the
same penalty. As the explanatory note accompanying S. No. 733
explains:
Plunder, a term chosen from other equally apt terminologies like
kleptocracy and economic treason, punishes the use of high office for
personal enrichment, committed thru a series of acts done not in the
public eye but in stealth and secrecy over a period of time, that may
involve so many persons, here and abroad, and which touch so many
states and territorial units. The acts and/or omissions sought to be
penalized do not involve simple cases of malversation of public funds,
bribery, extortion, theft and graft but constitute the plunder of an entire
nation resulting in material damage to the national economy. The
above-described crime does not yet exist in Philippine statute books.
Thus, the need to come up with a legislation as a safeguard against the
possible recurrence of the depravities of the previous regime and as a
deterrent to those with similar inclination to succumb to the corrupting
influences of power.
Many other examples drawn from the Revised Penal Code and from
special laws may be cited to show that, when special complex crimes
are created out of existing crimes, the penalty for the new crime is
heavier.
______________________
To recapitulate, had R.A. No. 7080 been a law regulating speech, I
would have no hesitation examining it on its face on the chance that
some of its provisions ¾ even though not here before us ¾ are void.
For then the risk that some state interest might be jeopardized, i.e., the
interest in the free flow of information or the prevention of "chill" on the
freedom of expression, would trump any marginal interest in security.
But the Anti-Plunder Law is not a regulation of speech. It is a criminal
statute designed to combat graft and corruption, especially those
committed by highly-placed public officials. As conduct and not speech
is its object, the Court cannot take chances by examining other
provisions not before it without risking vital interests of society.
Accordingly, such statute must be examined only "as applied" to the
defendant and, if found valid as to him, the statute as a whole should
not be declared unconstitutional for overbreadth or vagueness of its
other provisions. Doing so, I come to the following conclusions:
1. That the validity of R.A. No. 7080, otherwise known as the
Anti-Plunder Law, cannot be determined by applying the test
of strict scrutiny in free speech cases without disastrous
consequences to the State’s effort to prosecute crimes and
that, contrary to petitioner’s contention, the statute must be
presumed to be constitutional;
2. That in determining the constitutionality of the Anti-Plunder
Law, its provisions must be considered in light of the particular
acts alleged to have been committed by petitioner;
3. That, as applied to petitioner, the statute is neither vague
nor overbroad;
4. That, contrary to the contention of the Ombudsman and the
Solicitor General, the crime of plunder is a malum in se and
not a malum prohibitum and the burden of proving each and
every predicate crime is on the prosecution.
For these reasons, I respectfully submit that R.A. No. 7080 is valid and
that, therefore, the petition should be dismissed.
SEPARATE OPINION
(Concurring)
PANGANIBAN, J.:
In his Petition for Certiorari under Rule 65 of the Rules of Court, former
President Joseph Ejercito Estrada seeks the annulment of the
Sandiganbayan Resolution dated July 9, 2001, which denied his Motion
to Quash. He further prays to prohibit the anti-graft court from
conducting the trial of petitioner in Criminal Case No. 26558, on the
ground that the statute under which he has been charged – the Anti-
Plunder Law or Republic Act (RA) 7080 -- is unconstitutional.
In sum, he submits three main arguments to support his thesis, as
follows:
1. "RA 7080 is vague and overbroad on its face and suffers
from structural deficiency and ambiguity."1
2. "RA 7080 reduces the standard of proof necessary for
criminal conviction, and dispenses with proof beyond
reasonable doubt of each and every criminal act done in
furtherance of the crime of plunder."2
 3. "RA 7080 has been admitted by respondent to be malum
prohibita which deprives petitioner of a basic defense in
violation of due process."3
I have read former President Estrada’s Petition, Reply, Memorandum
and other pleadings and listened carefully to his Oral Argument.
However, I cannot agree with his thesis, for the following reasons:
(1) RA 7080 is not vague or overbroad. Quite the contrary, it
is clear and specific especially on what it seeks to prohibit and
to penalize.
(2) The Anti-Plunder Law does not lessen the degree of proof
necessary to convict its violator -- in this case, petitioner.
(3) Congress has the constitutional power to enact laws that
are mala prohibita and, in exercising such power, does not
violate due process of law.
First Issue: "Void for Vagueness" Not Applicable
In the main, petitioner attacks RA 7080 for being allegedly vague and
ambiguous, for "wanting in its essential terms," and for failing to "define
what degree of participation means as [it] relates to the person or
persons charged with having participated with a public officer in the
commission of plunder."4
In Dans v. People,5 reiterated recently in Sajul v. Sandiganbayan,6 this
Court debunked the "void for vagueness" challenge to the
constitutionality of Section 3(g) of the Anti-Graft Law (RA 3019, as
amended) and laid down the test to determine whether a statute is
vague. It has decreed that as long as a penal law can answer the basic
query "What is the violation?," it is constitutional. "Anything beyond this,
the ‘hows’ and the ‘whys,’ are evidentiary matters which the law cannot
possibly disclose in view of the uniqueness of every case x x x."
Elements of Plunder
The Anti-Plunder Law more than adequately answers the question
"What is the violation?" Indeed, to answer this question, any law
student -- using basic knowledge of criminal law -- will refer to the
elements of the crime, which in this case are plainly and certainly
spelled out in a straightforward manner in Sections 2 and 1(d) thereof.
Those elements are:
1. The offender is a public officer acting by himself or in
connivance with members of his family, relatives by affinity or
consanguinity, business associates, subordinates or other
persons.
2. The offender amasses, accumulates or acquires ill-gotten
wealth.
3. The aggregate amount or total value of the ill-gotten wealth
so amassed, accumulated or acquired is at least fifty million
pesos (₱50,000,000).
4. Such ill-gotten wealth -- defined as any asset, property,
business enterprise or material possession of any of the
aforesaid persons (the persons within the purview of Section
2, RA 7080) -- has been acquired directly or indirectly through
dummies, nominees, agents, subordinates and/or business
associates by any combination or series of the following
means or similar schemes:
(i) through misappropriation, conversion, misuse or
malversation of public funds or raids on the public
treasury;
(ii) by receiving, directly or indirectly, any
commission, gift, share, percentage, kickbacks or
any other form of pecuniary benefit from any person
and/or entity in connection with any government
contract or project or by reason of the office or
position of the public officer concerned;
(iii) by the illegal or fraudulent conveyance or
disposition of assets belonging to the national
government or any of its subdivisions, agencies or
instrumentalities or government-owned or controlled
corporations and their subsidiaries;
(iv) by obtaining, receiving or accepting directly or
indirectly any shares of stock, equity or any other
form of interest or participation including the promise
of future employment in any business enterprise or
undertaking;
(v) by establishing agricultural, industrial or
commercial monopolies or other combination and/or
implementation of decrees and orders intended to
benefit particular persons or special interests; or
(vi) by taking undue advantage of official position,
authority, relationship, connection or influence to
unjustly enrich himself or themselves at the expense
and to the damage and prejudice of the Filipino
people and the Republic of the Philippines.7
Petitioner argues that, notwithstanding the above-detailed statement of
the elements of the crime, there is still vagueness because of the
absence of definitions of the terms combination, series and pattern in
the text of the law.
Citing People v. Nazario,8 petitioner adds that "a statute or act may be
said to be vague when it lacks comprehensible standards that men of
common intelligence must necessarily guess at its meaning and differ
as to its application."
I say, however, that in that very case cited by petitioner, the Court
cautioned that "the act (or law) must be utterly vague on its face." When
it can be "clarified either by a saving clause or by construction," the law
cannot be decreed as invalid. In other words, the absence of statutory
definitions of words used in a statute will not render the law "void for
vagueness," if the meanings of such words can be determined through
the judicial function of construction.9
Solution: Simple
Statutory Construction
Indeed, simple statutory construction, not a declaration of
unconstitutionality, is the key to the allegedly vague words of the Anti-
Plunder Law. And the most basic rule in statutory construction is to
ascertain the meaning of a term from the legislative proceedings. Verily,
in the judicial review of a law’s meaning, the legislative intent is
paramount.10
Pervading the deliberations of the Bicameral Conference Committee on
Justice held on May 7, 1991 was the common understanding of
combination as a joining or combining of at least two dissimilar things or
acts, and series as a repetition or recurrence of the same thing at least
twice.11 As a matter of fact, the same understanding of those terms also
prevailed during the Senate deliberations on Senate Bill No. 733
(Plunder) earlier held on June 6, 1989.12 The Records of those
deliberations speak for themselves.
It is true that during the deliberations in the Senate, the late Senator
Neptali A. Gonzales initially raised concerns over the alleged
vagueness in the use of the terms combination and series. I respectfully
submit, however, that the reliance 13 of petitioner on such concerns is
misplaced. That portion of the interpellations, evincing the late senator’s
reservations on the matter, had taken place during the session of June
5, 1989.14 And the clarificatory remarks of Senate President Jovito R.
Salonga and Senators Wigberto Tañada, Alberto Romulo and Ernesto
Maceda, which threw light on the matters in doubt, happened the
following day, June 6, 1989. 15 In brief, the misgivings voiced by Senator
Gonzales as to the use of the two terms were adequately addressed,
answered and disposed of the following day.
Thus, Senate Bill No. 733, defining and penalizing plunder, was passed
and approved on third reading on July 25, 1989, with 19 affirmative
votes (including those of Senators Gonzales, Tañada, Maceda, and
petitioner himself) sans any negative vote or abstention. Indeed, some
of the sharpest legal minds in the country voted to approve the bill,
even though it was bereft of statutory definitions. Likewise, it would
certainly be inconceivable for Senator Gonzales to have voted for the
approval of the Bill had he believed that it was vague to the point of
constitutional infirmity; or at the very least, if he believed that his earlier
reservations or apprehensions were not fully satisfied.
At this juncture, may I call attention to the Record of the Joint
Conference Meeting held on May 7, 1991. 16 The portion thereof relied
upon by petitioner17 features the exchanges involving Representatives
Garcia and Isidro and Senator Tañada on the meanings of the terms
combination and series. The quoted part of the Record would suggest
that, somehow, particularly towards the end of the meeting, the
discussion among the legislators seemed to have degenerated into a
clutch of unfinished sentences and unintelligible phrases. Still, I believe
that the deliberations did not actually sound the way they were
subsequently transcribed or as they now appear on the Record. Even
more reluctant am I to agree with petitioner that the apparent tenor of
the deliberations evinced "a dearth of focus to render precise the
definition of the terms," or that the Committee members themselves
were not clear on the meanings of the terms in question.
Most of us in the legal profession are all too familiar with the vagaries of
stenographic note-taking, especially in courtrooms and legislative halls.
Too often, lawyers, parties-litigants and even judges find themselves at
the mercy of stenographers who are unfamiliar with certain legal terms;
or who cannot hear well enough or take notes fast enough; or who
simply get confused, particularly when two or more persons happen to
be speaking at the same time. Often, transcripts of stenographic notes
have portrayed lawyers, witnesses, legislators and judges as blithering
idiots, spouting utterly nonsensical jargon and plain inanities in the
course of a proceeding. The Record in question is no exception.
Rather than believe that the distinguished lawmakers went about their
business uttering senseless half-sentences to one another, I think that
these learned and intelligent legislators of both chambers knew what
they were talking about, spoke their minds, and understood each other
well, for the Record itself does not indicate the contrary. Neither does it
show any details or minutiae that would indicate that they abandoned
their earlier common understanding of the terms combination and
series.
Specific Number or
Percentage Not Always Necessary
Regrettably, I shall also have to take issue with petitioner’s disquisition
to the effect that "when penal laws enacted by Congress make
reference to a term or concept requiring a quantitative definition, these
laws are so crafted as to specifically state the exact number or
percentage necessary to constitute the elements of a crime," followed
by a recitation of the minimum number of malefactors mentioned in the
statutory definitions of band, conspiracy, illegal recruitment by
syndicate, large-scale illegal recruitment, organized/syndicated crime
group, and swindling by a syndicate. Thus, he insinuates that, because
RA 7080 has failed to specify precisely the minimum number of
malefactors needed for an offense to be properly classified as plunder,
the law is vague or has somehow failed to meet the standard for penal
laws.
The aforequoted discourse would appear to be incongruous, if not
totally misleading. As pointed out during the Oral Argument on
September 18, 2001, the crime of plunder can be committed by a public
officer acting alone. Section 2 of RA 7080 reads as follows: "Definition
of the Crime of Plunder; Penalties. – Any public officer who, by himself
or in connivance with x x x." Thus, the insistence on a mathematical
specification or precise quantification is essentially without basis. And
lest anyone believe that the Anti-Plunder Law is unusual in this respect,
let me just recall that the RICO law, to which petitioner made repeated
references in his Amended Petition, can likewise be violated by a single
individual.18
Not Oppressive
or Arbitrary
Neither can it be said that RA 7080 is oppressive or arbitrary for
imposing a more severe penalty on a combination or series of the
offenses enumerated in Section 1(d) of the law, than would otherwise
be imposed if the said offenses were taken separately. As Mr. Justice
Mendoza lucidly pointed out in his interpellation during the Oral
Argument, the Anti-Plunder Law is merely employing a familiar
technique or feature of penal statutes, when it puts together what would
otherwise be various combinations of traditional offenses already
proscribed by existing laws and attaching thereto higher or more severe
penalties than those prescribed for the same offenses taken separately.
Here, Mr. Justice Mendoza is referring to special complex crimes like
rape with homicide or robbery with homicide. During the Oral Argument,
he asked whether petitioner’s counsel was in fact suggesting that such
special complex crimes -- a very important part of the Revised Penal
Code and well-entrenched in our penal system -- were violative of due
process and the constitutional guarantees against cruel and unusual
punishment and should also be struck down. It goes without saying that
the legislature is well within its powers to provide higher penalties in
view of the grave evils sought to be prevented by RA 7080.
Innocent Acts Not
Penalized by RA 7080
Petitioner insists that innocent acts are in effect criminalized by RA
7080, because it allegedly penalizes combinations or series of acts
coming within the purview of the means or similar schemes enumerated
under items 4 and 5 of Section 1(d) of the law, which reads as follows:
"4. By obtaining, receiving or accepting directly or indirectly any shares
of stock, equity or any other forms of interest or participation including
the promise of future employment in any business enterprise or
undertaking;
"5. By establishing agricultural, industrial or commercial monopolies or
other combinations and/or implementation of decrees and orders
intended to benefit particular persons or special interests"
That such contention "deserves scant attention" is an understatement
of the extreme sort. The claim of "innocent acts" is possible only
because items 4 and 5 have been taken completely out of context and
read in isolation instead of in relation to the other provisions of the
same law, particularly Section 2. The above-enumerated acts, means
or similar schemes must be understood as having reference to or
connection with the acquisition of ill-gotten wealth by a public officer, by
himself or in connivance with others. Those acts are therefore not
innocent acts. Neither are those prohibitions new or unfamiliar. The
proscribed acts under item 4, for instance, may to some extent be
traced back to some of the prohibitions in RA 3019 (the Anti-Graft Law).
Section 3, the pertinent part of such law, reads as follows:
"SEC. 3. Corrupt practices of public officers. - In addition to acts or
omissions of public officers already penalized by existing law, the
following shall constitute corrupt practices of any public officer and are
hereby declared to be unlawful:
"(a) x x x x x x x x x
"(b) Directly or indirectly requesting or receiving any gift, present, share,
percentage, or benefit, for himself or for any other person, in connection
with any contract or transaction between the Government and any other
party wherein the public officer in his official capacity has to intervene
under the law.
"(c) Directly or indirectly requesting or receiving any gift, present or
other pecuniary or material benefit, for himself or for another, from any
person for whom the public officer, in any manner or capacity, has
secured or obtained, or will secure or obtain, any Government permit or
license, in consideration for the help given or to be given, without
prejudice to Section Thirteen of this Act.
"(d) Accepting or having any member of his family accept employment
in a private enterprise which has pending official business with him
during the pendency thereof or within one year after its termination.
x x x           x x x          x x x
"(h) Directly or indirectly having financial or pecuniary interest in any
business, contract or transaction in connection with which he intervenes
or takes part in his official capacity, or in which he is prohibited by the
Constitution or by any law from having any interest.
x x x x x x x x x."
On the other hand, the prohibited acts under item 5 have antecedents
in the Revised Penal Code’s interdiction against monopolies and
combinations in restraint of trade. Clearly, the acts dealt with in Items 4
and 5 of Section 1(d) are in no wise the innocent or innocuous deeds
that petitioner would have us mistake them for.
RA 7080 Not Suffering from Overbreadth
In connection with the foregoing discussion, petitioner also charges that
RA 7080 suffers from "overbreadth." I believe petitioner misconstrues
the concept. In the very recent case People v. Dela Piedra, 19 this Court
held:
"A statute may be said to be overbroad where it operates to inhibit the
exercise of individual freedoms affirmatively guaranteed by the
Constitution, such as the freedom of speech or religion. A generally
worded statute, when construed to punish conduct which cannot be
constitutionally punished, is unconstitutionally vague to the extent that it
fails to give adequate warning of the boundary between the
constitutionally permissible and the constitutionally impermissible
applications of the statute.
"In Blo Umpar Adiong vs. Commission on Elections, for instance, we
struck down as void for overbreadth provisions prohibiting the posting
of election propaganda in any place – including private vehicles – other
than in the common poster areas sanctioned by the COMELEC. We
held that the challenged provisions not only deprived the owner of the
vehicle the use of his property but also deprived the citizen of his right
to free speech and information. The prohibition in Adiong, therefore,
was so broad that it covered even constitutionally guaranteed rights
and, hence, void for overbreadth. In the present case, however,
appellant did not even specify what constitutionally protected freedoms
are embraced by the definition of ‘recruitment and placement’ that
would render the same constitutionally overbroad." (Italics supplied)
Similarly, in the instant case, petitioner has not identified which of his
constitutionally protected freedoms, if any, are allegedly being violated
by the Anti-Plunder Law. As Mr. Justice Mendoza pointed out to
petitioner’s counsel during the Oral Argument, specious and even
frivolous is the contention that RA 7080 infringes on the constitutional
right of petitioner by depriving him of his liberty pending trial and by
paving the way for his possible conviction because, following that line of
argument, the entire Revised Penal Code would be reckoned to be an
infringement of constitutional rights.
"Pattern of Overt or Criminal Acts"
Petitioner, in line with his "void for vagueness" attack on RA 7080,
faults the statute for failing to provide a definition of the phrase a
pattern of overt or criminal acts indicative of the overall unlawful
scheme or conspiracy used in Section 4 of the law. This definition is
crucial since, according to him, such pattern is an essential element of
the crime of plunder.
A plain reading of the law easily debunks this contention. First, contrary
to petitioner’s suggestions, such pattern of overt or criminal acts and so
on is not and should not be deemed an essential or substantive
element of the crime of plunder. It is possible to give full force and
effect to RA 7080 without applying Section 4 -- an accused can be
charged and convicted under the Anti-Plunder Law without resorting to
that specific provision. After all, the heading and the text of Section 4,
which I quote below, leave no room for doubt that it is not substantive in
nature:
"SEC. 4. Rule of Evidence. - For purposes of establishing the crime
of plunder, it shall not be necessary to prove each and every criminal
act done by the accused in furtherance of the scheme or conspiracy to
amass, accumulate or acquire ill-gotten wealth, it being sufficient to
establish beyond reasonable doubt a pattern of overt or criminal acts
indicative of the overall unlawful scheme or conspiracy." (Boldface
supplied)
As Mr. Chief Justice Davide very astutely pointed out during the Oral
Argument, Section 2 in relation to Section 1(d) deals with how the crime
of plunder is committed. Hence, these two sections constitute the
substantive elements, whereas Section 4 deals with how the crime is
proved and is therefore not substantive, but merely procedural. It may
be disregarded or discarded if found defective or deficient, without
impairing the rest of the statute.
Actually, the root of this problem may be traced to an observation made
by Rep. Pablo Garcia, chair of the House Committee on Justice, that
RA 7080 had been patterned after the RICO Law. 20 Petitioner
apparently seized on this statement and on the assertions in H.J. Inc. v.
Northwestern Bell21 and other cases that a pattern of racketeering is a
"key requirement" in the RICO Law and a "necessary element" of
violations thereof. He then used these as the springboard for his
vagueness attacks on RA 7080. However, his reliance on the RICO law
is essentially misplaced. Respondent Sandiganbayan correctly held
that the said legislation was essentially different from our Anti-Plunder
Law, as it pointed out in its Resolution of July 9, 2001, which I quote:
"Accused Joseph E. Estrada claims that the Anti-Plunder Law does not
define ‘pattern of overt or criminal acts’ indicative of the overall scheme
or conspiracy, thereby giving prosecutors and judges unlimited
discretion to determine the nature and extent of evidence that would
show ‘pattern.’" (Motion to Quash dated June 7, 2001, p. 13) The Court
disagrees with this contention.
"x x x. According to the sponsors of the Anti-Plunder Law in Congress,
the said law is similar to the U.S. RICO (Deliberations of the House of
Representatives Committee on Revision of Law and Justice, May 24,
1990). However, the similarities extend only insofar as both laws
penalize with severe penalties the commission by a single accused or
multiple accused of a pattern of overt or criminal acts as one continuing
crime. However, the legislative policies and objectives as well as the
nature of the crimes penalized respectively by the RICO and the Anti-
Plunder Law are different." (Boldface and underscoring supplied)
Indeed, a careful reading of RICO vis-à-vis RA 7080 can lead to no
other conclusion than that the crimes being penalized are completely
different in nature and character, and that the legislative objectives and
policies involved are quite dissimilar.
In the case of RICO, legislative concern focused on the threat of
continued racketeering activity, and that was why pattern was imbued
with such importance. "Congress was concerned in RICO with long-
term criminal conduct,"22 as the following quote indicates:
"RICO’s legislative history reveals Congress’ intent that to prove a
pattern of racketeering activity a plaintiff or prosecutor must show that
the racketeering predicates are related, and that they amount to or
pose a threat of continued criminal activity.23
x x x           x x x          x x x
"What a plaintiff or prosecutor must prove is continuity of racketeering
activity, or its threat, simpliciter. This may be done in a variety of ways,
thus making it difficult to formulate in the abstract any general test for
continuity. We can, however, begin to delineate the requirement.
"‘Continuity’ is both a closed and open-ended concept, referring either
to a closed period of repeated conduct, or to past conduct that by its
nature projects into the future with a threat of repetition. x x x. It is, in
either case, centrally a temporal concept – and particularly so in the
RICO context, where what must be continuous, RICO’s predicate acts
or offenses, and the relationship these predicates must bear one to
another, are distinct requirements. A party alleging a RICO violation
may demonstrate continuity over a closed period by proving a series of
related predicates extending over a substantial period of time.
Predicate acts extending over a few weeks or months and threatening
no future criminal conduct do not satisfy this requirement. Congress
was concerned in RICO with long-term criminal conduct. Often a RICO
action will be brought before continuity can be established in this way.
In such cases, liability depends on whether the threat of continuity is
demonstrated."24 (italics and underscoring supplied)
However, in RA 7080, precisely because of the sheer magnitude of the
crimes in question and their extremely deleterious effects on society,
the legislative sentiment of great urgency – the necessity of immediate
deterrence of such crimes -- was incompatible with the RICO concept
of "pattern" as connoting either continuity over a substantial period of
time or threat of continuity or repetition. The legislative intent25 and
policy of RA 7080 centered on imposing a heavy penalty in order to
achieve a strong, if not permanent, deterrent effect -- the sooner the
better. The following Senate deliberations are instructive:
"Senator Paterno. Mr. President, [I’m] not too clear yet on the reason
for trying to define a crime of plunder. Could I get some further
clarification?
"Senator Tañada. Yes, Mr. President.
"Because of our experience in the former regime, we feel that there is a
need for Congress to pass the legislation which would cover a crime of
this magnitude. While it is true, we already have the Anti-Graft Law. But
that does not directly deal with plunder. That covers only the corrupt
practices of public officials as well as their spouses and relatives within
the civil degree, and the Anti-Graft law as presently worded would not
adequately or sufficiently address the problems that we experienced
during the past regime.
"Senator Paterno. May I try to give the Gentleman, Mr. President, my
understanding of the bill?
"Senator Tañada. Yes.
"Senator Paterno. I envision that this bill or this kind of plunder would
cover a discovered interconnection of certain acts, particularly,
violations of Anti-Graft and Corrupt Practices Act when, after the
different acts are looked at, a scheme or conspiracy can be detected,
such scheme or conspiracy consummated by the different criminal acts
or violations of Anti-Graft and Corrupt Practices Act, such that the
scheme or conspiracy becomes a sin, as a large scheme to defraud the
public or rob the public treasury. It is parang robo and banda. It is
considered as that. And, the bill seeks to define or says that P100
million is that level at which ay talagang sobra na, dapat nang
parusahan ng husto. Would it be a correct interpretation or assessment
of the intent of the bill?
"Senator Tañada. Yes, Mr. President. X x x x x.
"Senator Paterno. Would the Author not agree that this crime of plunder
should be considered a heinous crime, Mr. President?
"Senator Tañada. Yes, Mr. President. That is why, the penalty imposed
under this bill is life imprisonment, and permanent disqualification from
holding public office.
"Senator Paterno. I would really ask, Mr. President, whether the Author
would not consider that this is a heinous crime which, for compelling
reasons, namely to try and dampen the graft and corruption, Congress
should provide the death penalty for the crime of plunder.
"Senator Tañada. I personally would have some problem with that, Mr.
President, because I am against the restoration of death penalty in our
criminal code. I would submit that to this Body.
"Senator Paterno. I respect the ministerial attitude and the respect for
human life of the author, Mr. President, but I just feel that graft and
corruption is such a large problem in our society that, perhaps, it is
necessary for this Congress to express itself that this crime of plunder
is a heinous crime which should be levied the death penalty, Mr.
President."26
Thus, it is clear and unarguable that "pattern," a key requirement or
necessary element of RICO, is in no wise an essential element of RA
7080.
This conclusion is further bolstered by the fact that pattern, in the RICO
law context, is nowhere to be found in the language of RA 7080 or in
the deliberations of Congress. Indeed, the legislators were well aware
of the RICO Act; hence, they could have opted to adopt its concepts,
terms and definitions and installed pattern in the RICO sense as an
essential element of the crime of plunder, if that were their intent. At the
very least, they would not have relegated the term pattern to a
procedural provision such as Section 4.
Second, to answer petitioner’s contention directly, the Anti-Plunder Law
does in fact provide sufficient basis to get at the meaning of the term
pattern as used in Section 4. This meaning is brought out in the
disquisition of Respondent Sandiganbayan in its challenged Resolution,
reproduced hereunder:
"The term ‘pattern’ x x x is sufficiently defined in the Anti-Plunder Law,
specifically through Section 4 x x x, read in relation to Section 1(d) and
Section 2 of the same law. Firstly, under Section 1(d) x x x, a pattern
consists of at least a combination or a series of overt or criminal acts
enumerated in subsections (1) to (6) of Section 1(d). Secondly,
pursuant to Section 2 of the law, the ‘pattern’ of overt or criminal acts is
directed towards a common purpose or goal which is to enable a public
officer to amass, accumulate or acquire ill-gotten wealth; and [t]hirdly,
there must either be an ‘overall unlawful scheme’ or ‘conspiracy’ to
achieve said common goal. As commonly understood, the term ‘overall
unlawful scheme’ indicates ‘a general plan of action or method’ which
the principal accused and public officer and others conniving with him
follow to achieve the aforesaid common goal. In the alternative, if there
is no such overall scheme or where the schemes or methods used by
multiple accused vary, the overt or criminal acts must form part of a
conspiracy to attain said common goal.
"Parenthetically, it can be said that the existence of a pattern indicating
an overall scheme or a single conspiracy would serve as the link that
will tie the overt or criminal acts into one continuing crime of plunder. A
conspiracy exists when two or more persons come into an agreement
concerning the commission of a felony and decide to commit it. (Art. 8,
Revised Penal Code). To use an analogy made by U.S. courts in
connection with RICO violations, a pattern may be likened to a wheel
with spokes (the overt or criminal acts which may be committed by a
single or multiple accused), meeting at a common center (the
acquisition or accumulation of ill-gotten wealth by a public officer) and
with the rim (the over-all unlawful scheme or conspiracy) of the wheel
enclosing the spokes. In this case, the information charges only one
count of [the] crime of plunder, considering the prosecution’s allegation
in the amended information that the series or combination of overt or
criminal acts charged form part of a conspiracy among all the
accused."27
Judiciary Empowered to Construe and Apply the Law
At all events, let me stress that the power to construe law is essentially
judicial. To declare what the law shall be is a legislative power, but to
declare what the law is or has been is judicial. 28 Statutes enacted by
Congress cannot be expected to spell out with mathematical precision
how the law should be interpreted under any and all given situations.
The application of the law will depend on the facts and circumstances
as adduced by evidence which will then be considered, weighed and
evaluated by the courts. Indeed, it is the constitutionally mandated
function of the courts to interpret, construe and apply the law as would
give flesh and blood to the true meaning of legislative enactments.
Moreover, a statute should be construed in the light of the objective to
be achieved and the evil or mischief to be suppressed and should be
given such construction as will advance the purpose, suppress the
mischief or evil, and secure the benefits intended. 29 A law is not a mere
composition, but an end to be achieved; and its general purpose is a
more important aid to its meaning than any rule that grammar may lay
down.30 A construction should be rejected if it gives to the language
used in a statute a meaning that does not accomplish the purpose for
which the statute was enacted and that tends to defeat the ends that
are sought to be attained by its enactment.31
As can be gleaned from the legislative deliberations, the Plunder Law
was enacted to curb the "despoliation of the National Treasury by some
public officials who have held the levers of power" and to penalize "this
predatory act which has reached unprecedented heights and has been
developed by its practitioners to a high level of sophistication during the
past dictatorial regime." Viewed broadly, "plunder involves not just plain
thievery but economic depredation which affects not just private parties
or personal interests but the nation as a whole." Invariably, plunder
partakes of the nature of "a crime against national interest which must
be stopped, and if possible, stopped permanently."32
No Patent and Clear Conflict with Constitution
Against the foregoing backdrop, I believe petitioner’s heavy reliance on
the void-for-vagueness concept cannot prevail, considering that such
concept, while mentioned in passing in Nazario and other cases, has
yet to find direct application in our jurisdiction. To this date, the Court
has not declared any penal law unconstitutional on the ground of
ambiguity.33 On the other hand, the constitutionality of certain penal
statutes has been upheld in several cases, notwithstanding allegations
of ambiguity in the provisions of law. In Caram Resources Corp. v.
Contreras34 and People v. Morato,35 the Court upheld the validity of BP
22 (Bouncing Checks Law) and PD 1866 (Illegal Possession of
Firearms), respectively, despite constitutional challenges grounded on
alleged ambiguity.
Similarly, the cases cited by petitioner involving U.S. federal court
decisions relative to the RICO Law did not at all arrive at a finding of
unconstitutionality of the questioned statute. To repeat, reference to
these U.S. cases is utterly misplaced, considering the substantial
differences in the nature, policies and objectives between the RICO
Law and the Anti-Plunder Law. Verily, "the RICO Law does not create a
new type of substantive crime since any acts which are punishable
under the RICO Law also are punishable under existing federal and
state statutes."36 Moreover, the main purpose of the RICO Law is "to
seek the eradication of organized crime in the United States."37
On the other hand, the Plunder Law creates an entirely new crime that
may consist of both (a) criminal acts already punished by the Revised
Penal Code or special laws and (b) acts that may not be punishable by
previously existing laws. Furthermore, unlike in the RICO Law, the
motivation behind the enactment of the Anti-Plunder Law is "the need
to for a penal law that can adequately cope with the nature and
magnitude of the corruption of the previous regime" 38 in accordance
with the constitutional duty of the State "to take positive and effective
measures against graft and corruption."39
In sum, the law must be proven to be clearly and unequivocally
repugnant to the Constitution before this Court may declare its
unconstitutionality. To strike down the law, there must be a clear
showing that what the fundamental law prohibits, the statute allows to
be done.40 To justify the nullification of the law, there must be a clear,
unequivocal breach of the Constitution; not a doubtful, argumentative
implication.41 Of some terms in the law which are easily clarified by
judicial construction, petitioner has, at best, managed merely to point
out alleged ambiguities. Far from establishing, by clear and
unmistakable terms, any patent and glaring conflict with the
Constitution, the constitutional challenge to the Anti-Plunder law must
fail. For just as the accused is entitled to the presumption of innocence
in the absence of proof beyond reasonable doubt, so must a law be
accorded the presumption of constitutionality without the same
requisite quantum of proof.
Second Issue:
Quantum of Evidence Not Lowered by RA 7080
I will now tackle petitioner’s impassioned asseverations that the Anti-
Plunder Law violates the due process clause and the constitutional
presumption of innocence.
Section 4 of RA 7080 provides that, for purposes of establishing the
crime of plunder, it shall not be necessary to prove each and every
criminal act done by the accused in furtherance of the scheme or
conspiracy to amass, accumulate or acquire ill-gotten wealth. This is
because it would be sufficient to establish beyond reasonable doubt a
pattern of overt or criminal acts indicative of the overall unlawful
scheme or conspiracy.
Hence, petitioner now concludes that the Anti-Plunder Law "eliminates
proof of each and every component criminal act of plunder by the
accused and limits itself to establishing just the pattern of overt or
criminal acts indicative of unlawful scheme or conspiracy." He thus
claims that the statute penalizes the accused on the basis of a proven
scheme or conspiracy to commit plunder, without the necessity of
establishing beyond reasonable doubt each and every criminal act
done by the accused. From these premises, he precipitately, albeit
inaccurately, concludes that RA 7080 has ipso facto lowered the
quantum of evidence required to secure a conviction under the
challenged law. This is clearly erroneous.
First, petitioner’s allegation as to the meaning and implications of
Section 4 can hardly be taken seriously, because it runs counter to
certain basic common sense presumptions that apply to the process of
interpreting statutes: that in the absence of evidence to the contrary, it
will be presumed that the legislature intended to enact a valid, sensible
and just law; that the law-making body intended right and justice to
prevail;42 and that the legislature aimed to impart to its enactments such
meaning as would render them operative and effective and prevent
persons from eluding or defeating them.
Second, petitioner’s allegation is contradicted by the legislative Records
that manifest the real intent behind Section 4, as well as the true
meaning and purpose of the provision therein. This intent is carefully
expressed by the words of Senate President Salonga:
"Senate Pres. Salonga. Is that, if there are let’s say 150 crimes all in all,
criminal acts, whether bribery, misappropriation, malversation,
extortion, you need not prove all of those beyond reasonable doubt. If
you can prove by pattern, let’s say 10, but each must be proved
beyond reasonable doubt, you do not have to prove 150 crimes. That’s
the meaning of this."43 (italics supplied)
All told, the above explanation is in consonance with what is often
perceived to be the reality with respect to the crime of plunder -- that
"the actual extent of the crime may not, in its breadth and entirety, be
discovered, by reason of the ‘stealth and secrecy’ in which it is
committed and the involvement of ‘so many persons here and abroad
and [the fact that it] touches so many states and territorial units.’" 44
Hence, establishing a pattern indicative of the overall unlawful scheme
becomes relevant and important.
Proof of Pattern Beyond Reasonable Doubt
Nevertheless, it should be emphasized that the indicative pattern must
be proven beyond reasonable doubt. To my mind, this means that the
prosecution’s burden of proving the crime of plunder is, in actuality,
much greater than in an ordinary criminal case. The prosecution, in
establishing a pattern of overt or criminal acts, must necessarily show a
combination or series of acts within the purview of Section 1(d) of the
law.
These acts which constitute the combination or series must still be
proven beyond reasonable doubt. On top of that, the prosecution must
establish beyond reasonable doubt such pattern of overt or criminal
acts indicative of the overall scheme or conspiracy, as well as all the
other elements thereof.
Thus, Respondent Sandiganbayan was correct in its ratiocination on
that point:
"The accused misread the import and meaning of the above-quoted
provision (Sec. 4). The latter did not lower the quantum of evidence
necessary to prove all the elements of plunder, which still remains proof
beyond reasonable doubt. For a clearer understanding of the import of
Section 4 of the Anti-Plunder Law, quoted hereunder are pertinent
portions of the legislative deliberations on the subject:
‘MR. ALBANO. Now, Mr. Speaker, it is also elementary in our criminal
law that what is alleged in the information must be proven beyond
reasonable doubt. If we will prove only one act and find him guilty of the
other acts enumerated in the information, does that not work against
the right of the accused especially so if the amount committed, say, by
falsification is less than P100 million, but the totality of the crime
committed is P100 million since there is malversation, bribery,
falsification of public document, coercion, theft?
‘MR. GARCIA (P). Mr. Speaker, not everything alleged in the
information needs to be proved beyond reasonable doubt. What is
required to be proved beyond reasonable doubt is every element of the
crime charged. For example, Mr. Speaker, there is an enumeration of
the things taken by the robber in the information – three pairs of pants,
pieces of jewelry. These need not be proved beyond reasonable doubt,
but these will not prevent the conviction of a crime for which he was
charged just because, say, instead of 3 pairs of diamond earrings the
prosecution proved only two. Now, what is required to be proved
beyond reasonable doubt is the element of the offense.
‘MR. ALBANO. I am aware of that, Mr. Speaker, but considering that in
the crime of plunder the totality of the amount is very important, I feel
that such a series of overt (or) criminal acts has to be taken singly. For
instance, in the act of bribery, he was able to accumulate only ₱50,000
and in the crime of extortion, he was only able to accumulate P1 million.
Now, when we add the totality of the other acts as required under this
bill through the interpretation on the rule of evidence, it is just one
single act, so how can we now convict him?
‘MR. GARCIA (P). With due respect, Mr. Speaker, for purposes of
proving an essential element of the crime, there is a need to prove that
element beyond reasonable doubt. For example, one essential element
of the crime is that the amount involved is P100 million. Now, in a
series of defalcations and other acts of corruption and in the
enumeration the total amount would be P110 or P120 million, but there
are certain acts that could not be proved, so, we will sum up the
amounts involved in these transactions which were proved. Now, if the
amount involved in these transactions, proved beyond reasonable
doubt, is P100 million, then there is a crime of plunder.’ (Deliberations
of House of Representatives on RA 7080, dated October 9, 1990).’
x x x           x x x          x x x
"According to the Explanatory Note of Senate Bill No. 733, the crime of
plunder, which is a ‘term chosen from other equally apt terminologies
like kleptocracy and economic treason, punishes the use of high office
for personal enrichment, committed through a series [or combination] of
acts done not in the public eye but in stealth or secrecy over a period of
time, that may involve so many persons, here and abroad, and which
touch so many states and territorial units.’ For this reason, it would be
unreasonable to require the prosecution to prove all the overt and
criminal acts committed by the accused as part of an ‘over-all unlawful
scheme or conspiracy’ to amass ill-gotten wealth as long as all the
elements of the crime of plunder have been proven beyond reasonable
doubt, such as, the combination or series of overt or criminal acts
committed by a public officer alone or in connivance with other persons
to accumulate ill-gotten wealth in the amount of at least Fifty Million
Pesos.
"The statutory language does not evince an intent to do away with the
constitutional presumption of guilt nor to lower the quantum of proof
needed to establish each and every element or ingredient of the crime
of plunder."45
In connection with the foregoing, I emphasize that there is no basis for
petitioner’s concern that the conspiracy to defraud, which is not
punishable under the Revised Penal Code, may have been criminalized
under RA 7080. The Anti-Plunder Law treats conspiracy as merely a
mode of incurring criminal liability, but does not criminalize or penalize it
per se.
In sum, it is clear that petitioner has misunderstood the import of
Section 4. Apropos the foregoing, I maintain that, between an
interpretation that produces questionable or absurd results and one that
gives life to the law, the choice for this Court is too obvious to require
much elucidation or debate.
Even granting arguendo that Section 4 of the Anti-Plunder law suffers
from some constitutional infirmity, the statute may nonetheless survive
the challenge of constitutionality in its entirety. Considering that this
provision pertains only to a rule on evidence or to a procedural matter
that does not bear upon or form any part of the elements of the crime of
plunder, the Court may declare the same unconstitutional and strike it
off the statute without necessarily affecting the essence of the
legislative enactment. For even without the assailed provision, the law
can still stand as a valid penal statute inasmuch as the elements of the
crime, as well as the penalties therein, may still be clearly identified or
sufficiently derived from the remaining valid portions of the law. This
finds greater significance when one considers that Section 7 of the law
provides for a separability clause declaring the validity, the
independence and the applicability of the other remaining provisions,
should any other provision of the law be held invalid or unconstitutional.
Third Issue:
The Constitutional Power of Congress to Enact Mala Prohibita Laws
Petitioner maintains that RA 7080 "eliminated the element of mens rea
from crimes which are mala in se and converted these crimes which are
components of plunder into mala prohibita, thereby rendering it easier
to prove" since, allegedly, "the prosecution need not prove criminal
intent."
This asseveration is anchored upon the postulate (a very erroneous
one, as already discussed above) that the Anti-Plunder Law exempts
the prosecution from proving beyond reasonable doubt the component
acts constituting plunder, including the element of criminal intent. It thus
concludes that RA 7080 violates the due process and the equal
protection clauses of the Constitution.
While I simply cannot agree that the Anti-Plunder Law eliminated mens
rea from the component crimes of plunder, my bottom-line position still
is: regardless of whether plunder is classified as mala prohibita or in se,
it is the prerogative of the legislature -- which is undeniably vested with
the authority -- to determine whether certain acts are criminal
irrespective of the actual intent of the perpetrator.
The Power of the Legislature to Penalize Certain Acts
Jurisprudence dating as far back as United States v. Siy Cong Bieng46
has consistently recognized and upheld "the power of the legislature,
on grounds of public policy and compelled by necessity, ‘the great
master of things,’ to forbid in a limited class of cases the doing of
certain acts, and to make their commission criminal without regard to
the intent of the doer." Even earlier, in United States v. Go Chico,47
Justice Moreland wrote that the legislature may enact criminal laws that
penalize certain acts, like the "discharge of a loaded gun," without
regard for the criminal intent of the wrongdoer. In his words:
"In the opinion of this Court it is not necessary that the appellant should
have acted with criminal intent. In many crimes, made such by statutory
enactment, the intention of the person who commits the crime is
entirely immaterial. This is necessarily so. If it were not, the statute as a
deterrent influence would be substantially worthless. It would be
impossible of execution. In many cases the act complained of is itself
that which produces the pernicious effect which the statute seeks to
avoid. In those cases the pernicious effect is produced with precisely
the same force and result whether the intention of the person
performing the act is good or bad. The case at bar is a perfect
illustration of this. The display of a flag or emblem used, particularly
within a recent period, by the enemies of the Government tends to
incite resistance to governmental functions and insurrection against
governmental authority just as effectively if made in the best of good
faith as if made with the most corrupt intent. The display itself, without
the intervention of any other factor, is the evil. It is quite different from
that large class of crimes, made such by the common law or by statute,
in which the injurious effect upon the public depends upon the corrupt
intention of the person perpetrating the act. If A discharges a loaded
gun and kills B, the interest which society has in the act depends, not
upon B’s death, but upon the intention with which A consummated the
act. If the gun were discharged intentionally, with the purpose of
accomplishing the death of B, then society has been injured and its
security violated; but if the gun was discharged accidentally on the part
of A, the society, strictly speaking, has no concern in the matter, even
though the death of B results. The reason for this is that A does not
become a danger to society and its institutions until he becomes a
person with a corrupt mind. The mere discharge of the gun and the
death of B do not of themselves make him so. With those two facts
must go the corrupt intent to kill. In the case at bar, however, the evil to
society and to the Government does not depend upon the state of mind
of the one who displays the banner, but upon the effect which that
display has upon the public mind. In the one case the public is affected
by the intention of the actor; in the other by the act itself."
Without being facetious, may I say that, unlike the act of discharging a
gun, the acts mentioned in Section 1(d) -- bribery, conversion,
fraudulent conveyance, unjust enrichment and the like -- cannot be
committed sans criminal intent. And thus, I finally arrive at a point of
agreement with petitioner: that the acts enumerated in Section 1(d) are
by their nature mala in se, and most of them are in fact defined and
penalized as such by the Revised Penal Code. Having said that, I join
the view that when we speak of plunder, we are referring essentially to
two or more instances of mala in se constituting one malum prohibitum.
Thus, there should be no difficulty if each of the predicate acts be
proven beyond reasonable doubt as mala in se, even if the defense of
lack of intent be taken away as the solicitor general has suggested.
In brief, the matter of classification is not really significant, contrary to
what petitioner would have us believe. The key, obviously, is whether
the same burden of proof -- proof beyond reasonable doubt -- would
apply.
Furthermore, I also concur in the opinion of the solicitor general: if it is
conceded that the legislature possesses the requisite power and
authority to declare, by legal fiat, that acts not inherently criminal in
nature are punishable as offenses under special laws, then with more
reason can it punish as offenses under special laws those acts that are
already inherently criminal. "This is so because the greater (power to
punish not inherently criminal acts) includes the lesser (power to punish
inherently criminal acts). In eo plus sit, semper inest et minus."48
Epilogue
"The constitutionality of laws is presumed. To justify nullification of a
law, there must be a clear and unequivocal breach of the Constitution,
not a doubtful or argumentative implication; a law shall not be declared
invalid unless the conflict with the Constitution is clear beyond a
reasonable doubt. ‘The presumption is always in favor of
constitutionality x x x. To doubt is to sustain.’ x x x."49
A law should not be overturned on the basis of speculation or
conjecture that it is unconstitutionally vague. Everyone is duty-bound to
adopt a reasonable interpretation that will uphold a statute, carry out its
purpose and render harmonious all its parts. Indeed, the
constitutionality of a statute must be sustained if, as in this case, a
ground therefor can possibly be found. For the unbending teaching is
that a law cannot be declared invalid, unless the conflict with the
Constitution is shown to be clearly beyond reasonable doubt.
To lend color and vividness to the otherwise boring legalese that has
been used to dissect RA 7080, the parties to this case laced their
arguments with interesting little stories. Thus, petitioner opened his Oral
Argument with an admittedly apocryphal account of a befuddled student
of law who could not make heads or tails of the meanings of series,
combination and pattern.
On the other hand, the solicitor general compares petitioner with Hans
Christian Andersen’s fabled tailors who tried to fool the emperor into
walking around naked by making him believe that anyone who did not
see the invisible garment, which they had supposedly sewn for him,
was "too stupid and incompetent to appreciate its quality." This is no
doubt a parody of the alleged vagueness of RA 7080, which is
purportedly "invisible only to anyone who is too dull or dense to
appreciate its quality."50
I do not begrudge petitioner (or his lawyers) for exhausting every known
and knowable legal tactic to exculpate himself from the clutches of the
law. Neither do I blame the solicitor general, as the Republic’s counsel,
for belittling the attempt of petitioner to shortcut his difficult legal
dilemmas. However, this Court has a pressing legal duty to discharge:
to render justice though the heavens may fall.
By the Court’s Decision, petitioner is now given the occasion to face
squarely and on the merits the plunder charges hurled at him by the
Ombudsman. He may now use this opportunity to show the courts and
the Filipino people that he is indeed innocent of the heinous crime of
plunder – to do so, not by resorting to mere legalisms, but by showing
the sheer falsity of the wrongdoings attributed to him.
I think that, given his repeated claims of innocence, petitioner owes that
opportunity to himself, his family, and the teeming masses he claims to
love. In short, the Court has rendered its judgment, and the heavens
have not fallen. Quite the contrary, petitioner is now accorded the
opportunity to prove his clear conscience and inculpability.
WHEREFORE, I vote to DISMISS the Petition and to uphold the
constitutionality of RA 7080.