B. Admin Agencies Conso Case Digests

Administrative Agencies (Nature and Definition; Creation, Establishment, and Abolition; Kinds; Advantages)
01. Malaga v. Penachos (G.R. No. 86695, September 3, 1992)

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER
Instrumentality refers to any agency of the National Government, not integrated within the department framework, vested with
special functions or jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and enjoying
operational autonomy, usually through a charter. This term includes regulatory agencies, chartered institutions, and government-
owned or controlled corporations.
FACTS
 Iloilo State College of Fisheries (ISCOF), through its PBAC, caused the publication of an Invitation to Bid for the
construction of a Micro Laboratory Building. They announced that the last day of submission for the pre-qualification
requirements was Dec. 2, 1988 and that the bids would be received and opened on Dec. 12 at 3pm.
 Petitioners Maria Malaga and Josieleen Najarro submitted their pre-qualification documents at 2pm on Dec 2 while Jose
Occeña submitted his on Dec 5. However, all three were not allowed to participate the bidding because their documents
were considered late having been submitted after the cut-off time of 10 am of Dec 2.
 Hence, petitioners filed a complaint before RTC Iloilo against the chairman and members of PBAC in their official and
personal capacities. Judge Lebaquin issued a TRO prohibiting PBAC from conducting the bidding and awarding project.
 Defendants filed a motion to lift the TRO because PD 1818 prohibits the issuance of restraining orders and preliminary
injunctions in cases involving infrastructure projects of the government.
 Petitioners argued that PD 1818 is not applicable because while ISCOF is a state college, it had its own charter and separate
existence and was not part of the national government or of any local political subdivisions.
ISSUE/S STATUTES/ARTICLES INVOLVED
W/N ISCOF is a national government agency and is therefore Instrumentality refers to any agency of the National Government,
covered by PD 1818. not integrated within the department framework, vested with
special functions or jurisdiction by law, endowed with some if not
all corporate powers, administering special funds, and enjoying
operational autonomy, usually through a charter. This term
includes regulatory agencies, chartered institutions, and
government-owned or controlled corporations. (Sec. 2 (5)
Introductory Provisions).
Chartered institution—refers to any agency organized or
operating under a special charter and vested by law with functions
relating to specific constitutional policies or objectives. This term
includes the state universities and colleges, and the monetary
authority of the state. (Sec. 2 (12) Introductory Provisions).
HELD: YES. ISCOF is an instrumentality of the government, specifically a chartered institution and is therefore covered by P.D.
1818.
It is clear from the above definitions that ISCOF is a chartered institution and is therefore covered by P.D. 1818.
 ISCOF was created in pursuance of the integrated fisheries development policy of the State, a priority program of the
government to effect the socio-economic life of the nation.
 The Treasurer of the Republic of the Philippines shall also be the ex-officio Treasurer of the state college with its accounts and
expenses to be audited by the Commission on Audit or its duly authorized representative.
 Heads of bureaus and offices of the National Government are authorized to loan or transfer to it, upon request of the president
of the state college, such apparatus, equipment, or supplies and even the services of such employees as can be spared without
serious detriment to public service.
 An additional amount of P1.5M had been appropriated out of the funds of the National Treasury and it was also decreed in its
charter that the funds and maintenance of the state college would henceforth be included in the General Appropriations Law.
Nevertheless, ISCOF is not covered by the prohibition of PD 1818 because of at least 2 irregularities committed by PBAC that
justified injunction of the bidding and the award of the project: (1) PBAC set deadlines for the filing of the PRE-C1 and the opening
of bids and then changed these deadlines without prior notice to prospective participants. (2) PBAC was required to issue to pre-
qualified applicants the plans, specifications and proposal book forms for the project to be bid 30 days before the date of bidding if
the estimated project cost was between P1M and P5M. However, the forms were issued only on Dec. 2 or 10 days before the bidding
on Dec 12. PBAC should have issued them on Nov 12.
2. Mactan Cebu International Airport Authority vs. Marcos (G.R. No. 120082, September 11, 1996)
The terms “Republic of the Philippines” and “National Government” are not interchangeable —the former is broader and
synonymous with “Government of the Republic of the Philippines” while the latter refers “to the entire machinery of the central
government, as distinguished from the different forms of local governments."
FACTS
❖ Eustaquio Cesa, OIC Treasurer of Cebu City, demanded payment for realty taxes on several parcels of land belonging to
Mactan-Cebu International Airport Authority.
❖ As the City of Cebu was about to issue a warrant of levy against the properties of MCIAA, the latter was compelled to pay
its tax account “under protest” and thereafter filed a Petition for Declaratory Relief with RTC Cebu.
❖ MCIAA claimed in its favor Sec. 14, RA 6958 w/c exempts it from payment of realty taxes. It asserted that it is an
instrumentality of the government performing governmental functions and hence the LGU’s taxing powers do not extend
to its taxes, fees, or charges, citing Sec. 133 of LGC.
❖ City of Cebu insisted that MCIAA is a GOCC, performing proprietary function, whose tax exemption privilege has been
withdrawn by virtue of Sec. 193 and 234 of the Local Government Code that took effect on January 1, 1992.
❖ Judge Ferdinand Marcos dismissed the petition and held that the exemption privilege was withdrawn under the LGC
would apply to all government corporations. Hence, this petition.
❖ MCIAA contends that Sec. 234(a) exempts from RPT the real property owned by the Republic of the Philippines, or any of
its political subdivisions and that the term “Republic of the Philippines” embraces its “instrumentalities” and agencies”.
W/N MCIAA is exempt from payment of realty taxes. Gov’t of the Republic of the Philippines - “corporate
governmental entity through which the functions of government
are exercised throughout the Philippines, including, save as the
contrary appears from the context, the various arms through
which political authority is made effective in the Philippines,
whether pertaining to the autonomous regions, the provincial,
city, municipal or barangay subdivisions or other forms of local
government (political subdivisions)." (Sec. 2[1], Admin Code)
Agency - any of the various units of the Government, including a

department, bureau, office, instrumentality, or GOCC, or a local
government or a distinct unit therein. (Sec. 2[4], Admin Code)
Instrumentality – any agency of the National Government, not

integrated within the department framework, vested with special
functions or jurisdiction by law, endowed with some if not all
corporate powers, administering special funds, and enjoying
operational autonomy, usually through a charter. This term
includes regulatory agencies, chartered institutions and GOCC."
(Sec. 2 [10], Admin Code)
HELD
NO. LGC unequivocally withdrew, upon the effectivity of the LGC, exemptions from payment of RPT granted to natural or juridical
persons, including GOCCs, except as provided in Sec. 234. MCIAA is, undoubtedly a GOCC, hence its exemption from such tax
granted it in Section 14 of its Charter, RA 6958, has been withdrawn. MCIAA can no longer invoke the general rule in Sec. 133 that
the taxing powers of LGUs cannot extend to the levy of taxes, fees, or charges of any kind on the NG, its agencies, or
instrumentalities and LGUs.
MCIAA’s contention that the term “Republic of the Philippines” in Sec. 234(a) embraces “instrumentalities” and “agencies” is
untenable. MCIAA’s claim that it is an instrumentality of the Government is based on Section 133(o), which expressly mentions the
word “instrumentalities”. Also, MCIAA fails to consider the fact that the legislature used the phrase “National Government, its
agencies and instrumentalities” in Section 133(o), but only the phrase “Republic of the Philippines or any of its political
subdivisions” in Section 234(a).
The terms “Republic of the Philippines” and “National Government” are not interchangeable. The former is broader and
synonymous with “Government of the Republic of the Philippines” while the latter refers to the entire machinery of the central
government, as distinguished from the different forms of local governments.
3. Manila International Airport Authority v. CA, City of Paranaque, City Mayor of Paranaque
When the law vests in a government instrumentality corporate powers, the instrumentality does not become a
corporation. Unless the government instrumentality is organized as a stock or non-stock corporation, it remains a
government instrumentality exercising not only governmental but also corporate powers. Likewise, when the law makes
a government instrumentality operationally autonomous, the instrumentality remains part of the National Government
machinery although not integrated with the department framework. The MIAA Charter expressly states that
transforming MIAA into a “separate and autonomous body” will make its operation more “financially viable.”
FACTS
Petitioner Manila International Airport Authority (MIAA) operates the Ninoy Aquino International Airport (NAIA)
Complex in Parañaque City under Executive Order No. 903, otherwise known as the Revised Charter of the Manila
International Airport Authority ("MIAA Charter"). As operator of the international airport, MIAA administers the land,
improvements and equipment within the NAIA Complex. The MIAA Charter transferred to MIAA approximately 600
hectares of land, including the runways and buildings ("Airport Lands and Buildings") then under the Bureau of Air
Transportation. The MIAA Charter further provides that no portion of the land transferred to MIAA shall be disposed
of through sale or any other mode unless specifically approved by the President of the Philippines.
On 28 June 2001, MIAA received Final Notices of Real Estate Tax Delinquency from the City of Parañaque for the
taxable years 1992 to 2001. On 17 July 2001, the City of Parañaque, through its City Treasurer, issued notices of levy
and warrants of levy on the Airport Lands and Buildings. The Mayor of the City of Parañaque threatened to sell at public
auction the Airport Lands and Buildings should MIAA fail to pay the real estate tax delinquency.
MIAA admits that the MIAA Charter has placed the title to the Airport Lands and Buildings in the name of MIAA.
However, MIAA points out that it cannot claim ownership over these properties since the real owner of the Airport
Lands and Buildings is the Republic of the Philippines. The MIAA Charter mandates MIAA to devote the Airport Lands
and Buildings for the benefit of the general public. Since the Airport Lands and Buildings are devoted to public use and
public service, the ownership of these properties remains with the State. The Airport Lands and Buildings are thus
inalienable and are not subject to real estate tax by local governments. MIAA also points out that Section 21 of the MIAA
Charter specifically exempts MIAA from the payment of real estate tax. MIAA insists that it is also exempt from real
estate tax under Section 234 of the Local Government Code because the Airport Lands and Buildings are owned by the
Republic.
Respondents invoke Section 193 of the Local Government Code, which expressly withdrew the tax exemption privileges
of "government-owned and-controlled corporations" upon the effectivity of the Local Government Code.
WON MIAA is a GOCC and hence subject to real (10) Instrumentality refers to any agency of the National
property tax. Government, not integrated within the department
framework, vested with special functions or jurisdiction by
law, endowed with some if not all corporate powers,
administering special funds, and enjoying
operational autonomy, usually through a charter …
(13) Government-owned or controlled corporation

refers to any agency organized as a stock or non-stock
corporation, vested with functions relating to public needs
whether governmental or proprietary in nature, and owned
by the Government directly or through its instrumentalities
either wholly, or, where applicable as in the case of stock
corporations, to the extent of at least fifty-one (51) percent
of its capital stock.
HELD
No. The Court rule that MIAA's Airport Lands and Buildings are exempt from real estate tax imposed by local
governments. First, MIAA is not a government-owned or controlled corporation but an instrumentality of the National
Government and thus exempt from local taxation. Second, the real properties of MIAA are owned by the Republic of
the Philippines and thus exempt from real estate tax.
MIAA is NOT a Government-Owned or Controlled Corporation
There is no dispute that a government-owned or controlled corporation is not exempt from real estate tax. However,
MIAA is not a government-owned or controlled corporation. A government-owned or controlled corporation must be
"organized as a stock or non-stock corporation." MIAA is not organized as a stock or non-stock corporation. MIAA is
not a stock corporation because it has no capital stock divided into shares. MIAA has no stockholders or voting shares.
Section 10 of the MIAA Charter 9 provides: SECTION 10. Capital. — The capital of the Authority to be contributed by
the National Government shall be increased from Two and One-half Billion (P2,500,000,000.00) Pesos to Ten Billion
(P10,000,000,000.00) Pesos xxx. Clearly, under its Charter, MIAA does not have capital stock that is divided into
shares.
Section 3 of the Corporation Code defines a stock corporation as one whose "capital stock is divided into shares and . . .
authorized to distribute to the holders of such shares dividends . . . ." MIAA has capital but it is not divided into shares
of stock. MIAA has no stockholders or voting shares. Hence, MIAA is not a stock corporation. MIAA is also not a non-
stock corporation because it has no members. Section 87 of the Corporation Code defines a non-stock corporation as
"one where no part of its income is distributable as dividends to its members, trustees or officers." A non-stock
corporation must have members. Even if we assume that the Government is considered as the sole member of MIAA,
this will not make MIAA a non-stock corporation. Non-stock corporations cannot distribute any part of their income to
their members. Section 11 of the MIAA Charter mandates MIAA to remit 20% of its annual gross operating income to
the National Treasury. 11 This prevents MIAA from qualifying as a non-stock corporation. Section 88 of the Corporation
Code provides that non-stock corporations are "organized for charitable, religious, educational, professional, cultural,
recreational, fraternal, literary, scientific, social, civil service, or similar purposes, like trade, industry, agriculture and
like chambers." MIAA is not organized for any of these purposes. MIAA, a public utility, is organized to operate an
international and domestic airport for public use. Since MIAA is neither a stock nor a non-stock corporation, MIAA
does not qualify as a government-owned or controlled corporation.
MIAA is a government instrumentality vested with corporate powers to perform efficiently its governmental functions.
MIAA is like any other government instrumentality, the only difference is that MIAA is vested with corporate powers.
When the law vests in a government instrumentality corporate powers, the instrumentality does not become a
corporation. Unless the government instrumentality is organized as a stock or non-stock corporation, it remains a
government instrumentality exercising not only governmental but also corporate powers. Thus, MIAA exercises the
governmental powers of eminent domain, police authority and the levying of fees and charges. At the same time, MIAA
exercises "all the powers of a corporation under the Corporation Law, insofar as these powers are not inconsistent with
the provisions of this Executive Order."
Many government instrumentalities are vested with corporate powers but they do not become stock or non-stock
corporations, which is a necessary condition before an agency or instrumentality is deemed a government-owned or
controlled corporation. Examples are the Mactan International Airport Authority, the Philippine Ports Authority, the
University of the Philippines and Bangko Sentral ng Pilipinas. All these government instrumentalities exercise
corporate powers but they are not organized as stock or non-stock corporations as required by Section 2(13) of the
Introductory Provisions of the Administrative Code. These government instrumentalities are sometimes loosely called
government corporate entities. However, they are not government-owned or controlled corporations in the strict sense
as understood under the Administrative Code, which is the governing law defining the legal relationship and status of
government entities.
Under Section 133(o) of the Local Government Code, MIAA as a government instrumentality is not a taxable person
because it is not subject to "[t]axes, fees or charges of any kind" by local governments. The only exception is when MIAA
leases its real property to a "taxable person" as provided in Section 234(a) of the Local Government Code, in which case
the specific real property leased becomes subject to real estate tax. Thus, only portions of the Airport Lands and
Buildings leased to taxable persons like private parties are subject to real estate tax by the City of Parañaque.
04. Manila International Airport Authority v. City of Pasay (G.R. No. 163072, April 2, 2009)
The definition of "instrumentality" under Section 2(10) of the Introductory Provisions of the Administrative Code of 1987 uses the
phrase "includes… government-owned or controlled corporations" which means that a government "instrumentality" may or may
not be a "government-owned or controlled corporation". Obviously, the term government "instrumentality" is broader than the
term "government-owned or controlled corporation".
FACTS
 Manila International Airport Authority (MIAA) operates and administer the Ninoy Aquino International Airport (NAIA)
Complex under EO 903.
 MIAA received final notices of Real Property Tax Delinquency from the City of Pasay for the taxable years 1992 to 2001
amounting to a total of around 1 Billion.
 City of Pasay then issued notices of levy and warrant of levy for NAIA properties. MIAA then filed with the CA a petition
for prohibition and injunction to enjoin City of Pasay from imposing RPT on NAIA properties. CA denied the petition,
hence this petition.
 CA invoked Sec 193 and 234 of R.A. No. 7160 of LGC which withdrew the tax exemption from payment of RPT granted to
GOCCs under R.A. No. 6938. Since MIAA is a GOCC it follows that the tax exemption has been withdrawn under the LGC.
W/N MCIAA is a GOCC. SEC. 2. General Terms Defined.
(10) Instrumentality refers to any agency of the national

Government, not integrated within the department framework,
vested with special functions or jurisdiction by law, endowed with
some if not all corporate powers, administering special funds, and
enjoying operational autonomy, usually through a charter. This
term includes regulatory agencies, chartered institutions and
government-owned or controlled corporations
(13) Government-owned or controlled corporation refers to any

agency organized as a stock or non-stock corporation, vested with
functions relating to public needs whether governmental or
proprietary in nature, and owned by the Government directly or
through its instrumentalities either wholly, or, where applicable
as in the case of stock corporations, to the extent of at least fifty-
one (51) percent of its capital stock: Provided, That government-
owned or controlled corporations may further be categorized by
the department of Budget, the Civil Service Commission, and the
Commission on Audit for the purpose of the exercise and
discharge of their respective powers, functions and
responsibilities with respect to such corporations.
HELD: NO.
The definition of "instrumentality" under Section 2(10) of the Introductory Provisions of the Administrative Code of 1987 uses the
phrase "includes… government-owned or controlled corporations" which means that a government "instrumentality" may or may
not be a "government-owned or controlled corporation". Obviously, the term government "instrumentality" is broader than the
term "government-owned or controlled corporation". The term "government-owned or controlled corporation" has a separate
definition under Section 2 (13) 8 of the Introductory Provisions of the Administrative Code of 1987.
The fact that two terms have separate definitions means that while a government "instrumentality" may include a "government-
owned or controlled corporation", there may be a government "instrumentality" that will not qualify as a "government-owned or
controlled corporation". A close scrutiny of the definition of "government-owned or controlled corporation" in Section 2 (13) will
show that MIAA would not fall under such definition. MIAA is a government "instrumentality" that does not qualify as a
"government-owned or controlled corporation"
A government-owned or controlled corporation must be "organized as a stock or non-stock corporation". MIAA is not organized as
a stock or non-stock corporation. MIAA is not a stock corporation because it has no capital stock divided into shares. MIAA has no
stockholders or voting shares
Thus, MIAA is not a government-owned or controlled corporation but a government instrumentality which is exempt from any
kind of tax from the local governments.
5. Mactan Cebu International Airport Authority vs. City of Lapu-Lapu (GR No. 181756, June 15, 2015)
MCIAA is an instrumentality of the government; thus, its properties, solely and exclusively used for public purposes, consisting
of the airport terminal building, airfield, runway, taxiway, and the lots on which they are situated, are not subject to real
property tax and respondent City is not justified in collecting taxes from petitioner over said properties.
FACTS
❖ City of Lapu-Lapu issued a Statement of Real Estate Tax assessing the lots comprising the MCIAA.
❖ MCIAA averred that the assessment covered real estate taxes on the lots utilized solely and exclusively for public or
governmental purposes such as the airfield, runway and taxiway, and the lots on which they are situated.
❖ DOJ issued an opinion declaring that the properties used for airport purposes are owned by the Republic of the Philippines
and are merely held in trust by the MCIAA, notwithstanding that certificates of title thereto may have been issued in
MCIAA’s name. DOF also had no objection over MCIAA’s tax exemption. Thus, DOJ instructed the City Assessor to transfer
the assessment of airfield, runway, taxiway, and the lots from “Taxable” to “Exempt Roll”.
❖ City Assessor sent another Statement still including said properties, hence MCIAA filed a petition for prohibition with RTC
Lapu-Lapu seeking to enjoin the City from issuing a warrant of levy against these properties.
❖ RTC and CA ruled against MCIAA holding that MCIAA is a GOCC and that the 1996 MCIAA case still controls.
❖ Hence, this petition. MCIAA claims that the Court had expressly declared in the 2006 MIAA case that MCIAA is not
considered a GOCC but is a government instrumentality. Thus, all its airport lands and buildings are exempt from real
estate taxes imposed by the City of Lapu-Lapu.
Whether or not MCIAA is a government instrumentality Instrumentality - any agency of the NG, not integrated w/in the
exempt from paying real property taxes. department framework vested w/ special functions or jurisdiction
by law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational autonomy,
usually through a charter. This term includes regulatory agencies,
chartered institutions and GOCC. (Sec. 2[10])
GOCC - any agency organized as a stock/non-stock corporation,

vested with functions relating to public needs whether
governmental or proprietary in nature, and owned by the
Government directly or through its instrumentalities either
wholly, or, where applicable as in the case of stock corporations,
to the extent of at least 51% of its capital stock. (Sec. 2[13])
Government Corporate Entities – instrumentalities or

agencies of the government, which are neither corporations nor
agencies integrated within the departmental framework, but
vested by law with special functions or jurisdiction, endowed with
enjoying operational autonomy usually through a charter. (Sec.
3[n], RA 10149)
HELD
YES. MCIAA is an instrumentality of the government; thus, its properties actually, solely and exclusively used
for public purposes, consisting of the airport terminal building, airfield, runway, taxiway and the lots on which
they are situated, are not subject to real property tax and the City of Lapu-Lapu is not justified in collecting taxes
from petitioner over said properties.
MCIAA is not a GOCC under Sec. 2(13) of the Introductory Provisions of the Admin Code because although it is vested with
corporate powers, it is not a stock or non-stock corporation, which is a necessary condition before an agency or instrumentality is
deemed a GOCC. Like MIAA, MCIAA has capital under its charter but it is not divided into shares of stock. It also has no
stockholders or voting shares. Instrumentalities like MCIAA are sometimes loosely called Government Corporate Entities.
MCIAA is a government instrumentality vested with corporate powers and performing essential public services pursuant to Sec.
2(10) of the Introductory Provisions of the Admin Code. As a government instrumentality, MCIAA is not subject to any kind of tax
by LGUs under Sec. 133(o) of the LGC. The exception to the exemption in Sec. 234(a) does not apply to MCIAA because MCIAA is
not a taxable entity under the LGC. Such exception applies only if the beneficial use of real property owned by the Republic is given
to a taxable entity. Thus, only portions of the Airport Lands and Buildings leased to taxable persons like private parties are subject
to real estate tax by the City of Lapu-Lapu.
6. Light Rail Transit Authority v. Quezon City, Represented by the City Treasurer and City Assessor
An agency will be classified as a government instrumentality vested with corporate powers when the following elements
concur: a) it performs governmental functions, and b) it enjoys operational autonomy. It does not matter that the
government instrumentality is endowed with corporate powers. The characterization of government instrumentality is
not lost where the government entity possesses corporate status. These are not polar opposites. This is so especially
when, despite the corporate status, it is really the resources and reputation of the Republic for a paramount public
purpose that are at stake in the capitalization and operations of the government entity.
FACTS
Pursuant to Executive Order No. 603 3 (EO 603) dated July 12, 1980, the Light Rail Transit Authority (LRTA) was
created primarily to construct, operate, maintain, and/or lease the light rail transit system of the country. For this
purpose, the LRTA acquired real properties and commenced its operations in 1984. On October 15, 2007, the LRTA
received several Statements of Delinquency and Final Notices of Tax Delinquency, this time, from respondent Quezon
City. Through the Office of the City Treasurer, Quezon City issued warrants of levy on the LRTA's properties on which
realty taxes had not been paid. In December 2007, Quezon City auctioned the affected LRTA properties. But for lack of
any interested bidder, these properties were instead sold to Quezon City.
Invoking MIAA v. Court of Appeals, the LRTA asserted anew that it is a government instrumentality, hence, exempt
from real property tax. For its part, Quezon City countered that the LRTA is not a government instrumentality but a
government-owned and controlled corporation (GOCC). Its activities are proprietary in nature and not purely
governmental. It is clothed with corporate status and powers, earns profit, and operates as an ordinary private
corporation. EO 603 does not exempt the LRTA from real property taxes. The Local Government Code of 1991 has
removed or withdrawn the tax exemptions of GOCCs.
Is the LRTA a GOCC or a government instrumentality. (10) Instrumentality as any agency of the National
Government, not integrated within the department
framework, vested with special functions or jurisdiction by
law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational
autonomy, usually through a charter." The Court had on
several occasions clarified that the legal vesture of corporate
powers in a government instrumentality does not negate its
status as such.
(13) Government-owned or controlled corporations

refer to any agency organized as a stock or non-stock
corporation vested with functions relating to public needs
whether governmental or proprietary in nature, and owned
by the government directly or indirectly through its
instrumentalities either wholly, or where applicable as in
the case of stock corporations to the extent of at least 51%
(fifty-one percent) of its capital stock.
HELD
LRTA is a government instrumentality exercising corporate powers. An agency is a government-owned or controlled

corporation when it is organized as a stock or non-stock corporation. A stock corporation is one that sources its capital
through shares of stock and therefore has a share capital or capital stock, not just capital, whose capital stock is divided
into shares, and who is authorized to distribute dividend to the holders of such share. A non-stock corporation, on the
other hand, is one where no part of its income is distributable as dividends to its members, trustees, or officers. A non-
stock corporation must have members. Consequently, to be considered as a GOCC, an entity must either be organized
as a stock or non-stock corporation. Three (3) requisites must concur for one to be classified as a stock corporation,
viz.: (1) it has capital stock, (2) the capital stock is divided into shares, and (3) it is authorized to distribute dividends
and allotments of surplus and profits to its stockholders. As for non-stock corporations, they must have members and
must not distribute any part of their income to said members.
Under their respective Charters, both the LRTA and the MIAA do not have capital stock that is divided into shares. The
LRTA is also not a non-stock corporation because it has no members. In any case, having a GOCC status does not at
once disqualify one from real property tax exemption. Having a GOCC status simply means that the GOCC must find a
legal basis for claiming real property tax exemption other than what was previously granted to it under the old real
property tax laws which Local Government Code has already repealed. It is in this light that the LRTA's status as a
government instrumentality assumes importance for the purpose of claiming real property tax exemption.
The classification of Government Instrumentalities with Corporate Powers(GICP)/Government Corporate Entities is

now officially recognized. Examples of instrumentalities of the national government vested with corporate powers are
the Manila International Airport Authority, the Philippine Fisheries Development Authority, the Government Service
Insurance System, and the Philippine Reclamation Authority. These entities are government instrumentalities because
each of them is not integrated within the department framework and is vested with special functions to carry out a
declared policy of the national government. An agency will be classified as a government instrumentality vested with
corporate powers when the following elements concur: a) it performs governmental functions, and b) it enjoys
operational autonomy. It does not matter that the government instrumentality is endowed with corporate powers. The
characterization of government instrumentality is not lost where the government entity possesses corporate status.
These are not polar opposites. This is so especially when, despite the corporate status, it is really the resources and
reputation of the Republic for a paramount public purpose that are at stake in the capitalization and operations of the
government entity.
Here, the LRTA bears the elemental characteristics of a government instrumentality vested with corporate powers. One.
The vesture of its corporate powers is found in Article 2 of Executive Order 603 otherwise known as “Creating a Light
Rail Transit Authority, Vesting the same with Authority to Construct and Operate the Light Rail Transit (LRT) project
and providing funds. Two. The LRTA performs governmental functions. Three. The LRTA also enjoys operational
autonomy.
In sum, a government instrumentality though vested with corporate powers are exempt from real property tax, but the
exemption shall not extend to taxable private entities to whom the beneficial use of the government instrumentality's
properties has been vested. The taxable private entities are subject to real property tax, but not the government
instrumentality they have dealt with, much less, the properties of the government instrumentality subject of such
beneficial use.
07. Philippine Heart Center v. Quezon City (G.R. No. 225409, March 11, 2020)
An agency will be classified as a government instrumentality vested with corporate powers when the following elements
concur: a) it performs governmental functions, and b) it enjoys operational autonomy. The PHC passes these twin criteria.
FACTS
 Phil Heart Center (PHC) was established under PD 673 as a specialty hospital mandated to provide expert comprehensive
cardiovascular care to the general public, especially the poor and less fortunate in life. To enable the PHC to perform its
mandate, the national government provided the initial land, building, equipment and facilities needed for its establishment.
 Quezon City issued (3) final Notices of Delinquency for unpaid real property taxes of Php36,530,545.00 pertaining to the
11 properties of the PHC.
 PHC entered into a MOA with the Quezon City as a means to settle its tax liabilities. Under this MOA, the PHC agreed to
provide free medical services to qualified residents of Quezon City until the accumulated monetary value of these services
was sufficient to cover the real property taxes it owed.
 Subsequently, a new MOA was forged between the PHC and Quezon City containing the same stipulations in their earlier
agreement. The PHC, however, suspended the implementation of the second MOA when Dr. Manuel T. Chua Chiaco Jr.
became Executive Director. It also reiterated its exemption from payment of taxes based on the OGCC's August 22, 2006
Memorandum.
 Quezon City Treasurer issued a Warrant of Levy for the PHC's failure to pay real property taxes despite due notice.
 On September 1, 2011, the PHC filed a petition for certiorari before the Court of Appeals, claiming respondents Quezon
City Mayor, Treasurer and Assessor gravely abused their discretion when they assessed, levied and sold its properties. It
asserted that under the Court's ruling in MIAA, it was exempt from taxes, fees and charges imposed by a local government
unit. CA dismissed the petition hence the current case.
W/N PHC is exempted from real property tax. SEC. 2. General Terms Defined.
(10) Instrumentality refers to any agency of the national

Government, not integrated within the department framework,
vested with special functions or jurisdiction by law, endowed with
enjoying operational autonomy, usually through a charter. This
term includes regulatory agencies, chartered institutions and
government-owned or controlled corporations
HELD: Yes. At any rate, it is exempt from real property taxes as a government instrumentality.
Administrative Code of 1987, defines an "Instrumentality" as "any agency of the National Government, not integrated within the
department framework, vested with special functions or jurisdiction by law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational autonomy, usually through a charter." From this definition, the category of
an instrumentality with corporate powers was born. The concept came to fore by virtue of this Court's pronouncement in MIAA.
Hence, in addition to government-owned and controlled corporations (GOCCs) and instrumentalities, a third category of
government agencies under the jurisdiction of the OGCC is now recognized — government instrumentalities vested with corporate
powers or government corporate entities. These entities remain government instrumentalities because they are not integrated
within the department framework and are vested with special functions to carry out a declared policy of the
national government.
An agency will be classified as a government instrumentality vested with corporate powers when the following elements concur: a)
it performs governmental functions, and b) it enjoys operational autonomy. The PHC passes these twin criteria. Certainly, the
PHCs' enumerated functions are less commercial than governmental, and more for public use and public welfare than for profit-
oriented services. As such, the PHC is authorized to "call upon any department, bureau, office, agency or instrumentality of the
Government, including government-owned or controlled corporations, for such assistance as it may need in the pursuit of its
purposes and objectives. Too, the PHC is vested with corporate powers under Section 5 of PD 673.
The PHC therefore bears the essential characteristics of a government instrumentality vested with corporate powers, exempt from
real property taxes. Indeed, the PHC's corporate status does not divest itself of its character as a government instrumentality. These
are not polar opposites. For despite its corporate status, it is really the resources and reputation of the Republic that are at stake in
the capitalization and operations of the government entity.
8. De la Llana v. Alba (GR No. No. L-57883. March 12, 1982)
Abolition of an office if done in good faith is valid.
FACTS
❖ De la Llana, who is a presiding judge of the City Court of Olongapo, together with other petitioners seek to enjoin
respondent Minister of the Budget, Chairman of COA, and Minister of Justice from taking any action implementing BP
129, entitled, “An Act Reorganizing Judiciary, Appropriating Funds Therefor and for Other Purposes”.
❖ Petitioners seek to enjoin respondents from implementing BP 129 which mandates that Justices and judges of inferior
courts from the Court of Appeals to municipal circuit courts, except the occupants of the Sandiganbayan and the Court of
Tax Appeals, unless appointed to the inferior courts established by such Act, would be considered separated from the
judiciary.
❖ Petitioners allege that BP 129 ignores and disregards the security of tenure provision in the Constitution.
"The Members of the Supreme Court and judges of inferior courts shall hold office during good behavior until they reach
the age of seventy years or become incapacitated to discharge the duties of their office. The Supreme Court shall have the
power to discipline judges of inferior courts and, by a vote of at least eight Members, order their dismissal."
Whether or not the abolition of inferior courts as a result of

the implementation of B.P. 129 is valid.
HELD
YES. The abolition of an office within the competence of a legitimate body if done in good faith suffers from no infirmity. Valid
abolition of offices is neither removal nor separation of the incumbents. If the abolition is void, the incumbent is deemed never to
have ceased to hold office. As with the offices in the other branches of the government, so it is with the judiciary. The test remains
whether the abolition is in good faith. As that element is conspicuously present in the enactment of BP 129, then the lack of merit
of this petition becomes even more apparent.
The legislature may abolish courts inferior to the Supreme Court and therefore may reorganize them territorially or otherwise
thereby necessitating new appointments and commissions.
Removal is, of course, to be distinguished from termination by virtue of the abolition of the office. There can be no tenure to a non-
existent office. After the abolition, there is in law no occupant. In case of removal, there is an office with an occupant who would
thereby lose his position. It is in that sense that from the standpoint of strict law, the question of any impairment of security of
tenure does not arise. Nonetheless, for the incumbents of inferior courts abolished, the effect is one of separation. As to its effect,
no distinction exists between removal and the abolition of the office. Realistically, it is devoid of significance. He ceases to be a
member of the judiciary.
9. Alexis Canonizado, Edgar Dula Torres and Rogelio Pureza v. Hon. Alexander Aguirre et al.
The creation and abolition of public offices is primarily a legislative function. It is acknowledged that Congress may
abolish any office it creates without impairing the officer's right to continue in the position held and that such power
may be exercised for various reasons, such as the lack of funds or in the interest of economy. However, in order for the
abolition to be valid, it must be made in good faith, not for political or personal reasons, or in order to circumvent the
constitutional security of tenure of civil service employees.
FACTS
Republic Act No. 8551 (RA 8551), otherwise known as the "Philippine National Police Reform and Reorganization Act
of 1998," by virtue of which petitioners herein, who were all members of the National Police Commission
(NAPOLCOM), were separated from office. On March 6, 1998, RA 8551 took effect; it declared that the terms of the
current Commissioners were deemed as expired upon its effectivity. Petitioners claim that such law violates their
constitutionally guaranteed right to security of tenure. Public respondents insist that the express declaration in Section
8 of RA 8551 that the terms of petitioners' offices are deemed expired discloses the legislative intent to impliedly abolish
the NAPOLCOM created under RA 6975 pursuant to a bona fide reorganization.
WON petitioners were removed by virtue of a valid

abolition of their office by Congress.
HELD
NO. It is beyond dispute that petitioners herein are members of the civil service, which embraces all branches,
subdivisions, instrumentalities, and agencies of the Government, including government-owned or controlled
corporations with original charters. As such, they cannot be removed or suspended from office, except for cause
provided by law. The phrase "except for cause provided by law" refers to ". . . reasons which the law and sound public
policy recognize as sufficient warrant for removal, that is, legal cause, and not merely causes which the appointing
power in the exercise of discretion may deem sufficient."
The creation and abolition of public offices is primarily a legislative function. It is acknowledged that Congress may
abolish any office it creates without impairing the officer's right to continue in the position held and that such power
may be exercised for various reasons, such as the lack of funds or in the interest of economy. However, in order for the
abolition to be valid, it must be made in good faith, not for political or personal reasons, or in order to circumvent the
constitutional security of tenure of civil service employees.
An abolition of office connotes an intention to do away with such office wholly and permanently, as the word "abolished"
denotes. Where one office is abolished and replaced with another office vested with similar functions, the abolition is a
legal nullity. Thus, in U.P. Board of Regents vs. Rasul, 200 SCRA 685 (1991), the Court said: It is true that a valid and
bona fide abolition of an office denies to the incumbent the right to security of tenure. [De la Llana vs. Alba, 112 SCRA
294 (1982)] However, in this case, the renaming and restructuring of the PGH and its component units cannot give rise
to a valid and bona fide abolition of the position of PGH Director. This is because where the abolished office and the
offices created in its place have similar functions, the abolition lacks good faith. [Jose L. Guerrero vs. Hon. Antonio V.
Arizabal , G.R. No. 81928, June 4, 1990, 186 SCRA 108 (1990)] The Court hereby apply the principle enunciated in
Cesar Z. Dario vs. Hon. Salvador M. Mison [176 SCRA 84 (1989)] that abolition which merely changes the nomenclature
of positions is invalid and does not result in the removal of the incumbent. The above notwithstanding, and assuming
that the abolition of the position of the PGH Director and the creation of a UP-PGH Medical Center Director are valid,
the removal of the incumbent is still not justified for the reason that the duties and functions of the two positions are
basically the same. . . . This was also the Court's ruling in Guerrero vs. Arizabal, 186 SCRA 108 (1990), wherein it was
declared that the substantial identity in the functions between the two offices was indicia of bad faith in the removal of
petitioner pursuant to a reorganization.
The powers and duties of the NAPOLCOM remain basically unchanged by the amendments under RA 8551. Public
respondents argue that the fact that the NAPOLCOM is now vested with administrative control and operational
supervision over the PNP, whereas under RA 6975 it only exercised administrative control should be construed as
evidence of legislative intent to abolish such office. This contention is bereft of merit.
Control means "the power of an officer to alter or modify or set aside what a subordinate officer had done in the
performance of his duties and to substitute the judgment of the former for that of the latter." On the other hand, to
supervise is to oversee, to have oversight of, to superintend the execution of or the performance of a thing, or the
movements or work of a person, to inspect with authority; it is the power or authority of an officer to see that
subordinate officers perform their duties. Thus, the power of control necessarily encompasses the power of supervision
and adding the phrase "operational supervision" under the powers of the NAPOLCOM would not bring about a
substantial change in its functions so as to arrive at the conclusion that a completely new office has been created.
Public respondents would have this Court believe that RA 8551 reorganized the NAPOLCOM resulting in the abolition
of petitioners' offices. We hold that there has been absolutely no attempt by Congress to effect such a reorganization.
Reorganization takes place when there is an alteration of the existing structure of government offices or units therein,
including the lines of control, authority and responsibility between them. It involves a reduction of personnel,
consolidation of offices, or abolition thereof by reason of economy or redundancy of functions. Naturally, it may result
in the loss of one's position through removal or abolition of an office. However, for a reorganization to be valid, it must
also pass the test of good faith, laid down in Dario vs. Mison: . . . As a general rule, a reorganization is carried out in
"good faith" if it is for the purpose of economy or to make bureaucracy more efficient. In that event, no dismissal (in
case of a dismissal) or separation actually occurs because the position itself ceases to exist. And in that case, security of
tenure would not be a Chinese wall. Be that as it may, if the "abolition," which is othing else but a separation or removal,
is done for political reasons or purposely to defeat security of tenure, or otherwise not in good faith, no valid "abolition"
takes place and whatever "abolition" is done, is void ab initio. There is an invalid "abolition" as where there is merely a
change of nomenclature of positions, or where claims of economy are belied by the existence of ample funds.
It is exceedingly apparent to this Court that RA 8551 effected a reorganization of the PNP, not of the NAPOLCOM. They
are two separate and distinct bodies, with one having supervision and control over the other. In fact, it is the
NAPOLCOM that is given the duty of submitting a proposed reorganization plan of the PNP to Congress. As mentioned
earlier, the basic structure of the NAPOLCOM has been preserved by the amendatory law. There has been no revision
in its lines of control, authority and responsibility, neither has there been a reduction in its membership, nor a
consolidation or abolition of the offices constituting the same. Adding the Chief of the PNP as an ex-officio member of
the Commission does not result in a reorganization.
No bona fide reorganization of the NAPOLCOM having been mandated by Congress, RA 8551, insofar as it declares the
terms of office of the incumbent Commissioners, petitioners herein, as expired and resulting in their removal from
office, removes civil service employees from office without legal cause and must therefore be struck down for being
constitutionally infirm. Petitioners are thus entitled to be reinstated to office.
10. Kapisanan ng mga Kawani ng ERB vs Barin (G.R. No. 150974, June 29, 2007)
The power to create an office carries with it the power to abolish.
An abolition is made in good faith when it is not made for political or personal reasons, or when it does not circumvent the
constitutional security of tenure of civil service employees. Where one office is abolished and replaced with another office vested
with similar functions, the abolition is a legal nullity.
FACTS
 KERB seeks to declare Sec 38, RA 9136, which abolished the ERB and created the ERC, as unconstitutional and to prohibit
the ERC Commissioners from filling up the ERC’s plantilla.
 It the view of the newly appointed Commissioners that since ERB was abolished, the provisions of RA 6656 (An Act to
Protect the Security of Tenure of CSC employees in the Implementation of Government Reorganization) will not directly
apply to ERC’s current efforts to establish a new organization. Civil Service laws, rules and regulations, however, will have
suppletory application to the extent possible in regard to the selection and placement of employees in the ERC.
 KERB asserted that RA 9136 did not abolish the ERB or change the ERB’s character as an economic regulator of the electric
power industry. KERB insisted that RA 9136 merely changed the ERB’s name to the ERC and expanded the ERB’s functions
and objectives.
W/N Section 38 of RA 9136 abolishing the ERB is

constitutional.
HELD: Yes.
The power to create an office carries with it the power to abolish. The question of whether a law abolishes an office is a question of
legislative intent. Sec. 38 of RA 9136 explicitly abolished the ERB. However, abolition of an office and its related positions is
different from removal of an incumbent from his office. There is no occupant in an abolished office, hence there is no tenure to
speak of. Thus, impairment of the constitutional guarantee of security of tenure does not arise in the abolition of an office. On the
other hand, removal implies that the office and its related positions subsist and that the occupants are merely separated from their
positions.
An abolition is made in good faith when it is not made for political or personal reasons, or when it does not circumvent the
constitutional security of tenure of civil service employees. Where one office is abolished and replaced with another office vested
with similar functions, the abolition is a legal nullity.
After comparing the functions of the ERB and the ERC, we find that the ERC indeed assumed the functions of the ERB. However,
the overlap in the functions of the ERB and of the ERC does not mean that there is no valid abolition of the ERB. The ERC has new
and expanded functions which are intended to meet the specific needs of a deregulated power industry.
“If the newly created office has substantially new, different or additional functions, duties or powers, so that it may be said in fact
to create an office different from the one abolished, even though it embraces all or some of the duties of the old office it will be
considered as an abolition of one office and the creation of a new or different one. The same is true if one office is abolished and its
duties, for reasons of economy are given to an existing officer or office.” (NLTDRA v. CSC, 1993)
Throughout the years, the scope of the regulation has gradually narrowed from that of public services in 1902 to the electricity
industry and water resources in 1972 to the electric power industry and oil industry in 1977 to the electric industry alone in 1998.
The ERC retains the ERB’s traditional rate and service regulation functions. However, the ERC now also has to promote competitive
operations in the electricity market. RA 9136 expanded the ERC’s concerns to encompass both the consumers and the utility
investors. Thus, there was a valid abolition of ERB. No impairment of security of tenure.
11. Crisostomo v. Court of Appeals (G.R. No. 106296, July 5, 1996)
When the purpose is to abolish a department or an office or an organization and to replace it with another one, the law-making
authority says so. Neither the addition of new course offerings nor changes in its existing structure and organization bring about
the abolition of an educational institution and the creation of a new one—only an express declaration to that effect by the law-
making authority will.
FACTS
❖ Isabelo Crisostomo was the appointed President of the Philippine College of Commerce. During his incumbency as
president of the PCC, 2 administrative cases; charges of violations of R.A. No. 3019, §3(e) and R.A.No. 992, §§20-21 and
R.A. No. 733, §14; and 3 Informations for violation of Sec. 3(e) of the Anti-Graft and Corrupt Practices Act were filed against
him. Crisostomo was preventively suspended, and Dr. Pablo Mateo was designated OIC.
❖ On April 1, 1978 Marcos issued PD 1341 converting PCC into PUP and expanding its curricular offerings. Mateo continued
as head of PUP and on March 28, 1980 was eventually appointed President for 6 years.
❖ Meanwhile, Crisostomo was acquitted of the charges against him and was ordered reinstated as President of PUP and as
such entitled to receive salaries which he failed to receive during his suspension. Other cases against him were likewise
dismissed. RTC granted Crisostomo’s motion for execution of judgment.
❖ Aquino appointed Dr. Jaime Gellor as acting PUP President. RTC reiterated its Order but Gellor refused to vacate.
❖ CA set aside RTC’s Order reinstating Isabelo Crisostomo to the position of President of PUP and ordered only the payment
accruing to Crisostomo from the time of his suspension until PCC’s conversion to PUP. Hence, this petition.
❖ Crisostomo argues that P.D. No.1341, which converted the PCC into the PUP, did not abolish the PCC. He claims that PUP
is merely a continuation of the existence of the PCC, and, hence, he could be reinstated to his former position as President.
Whether or not the PD 1341 which converted PCC into PUP,

abolished PCC
HELD
NO. P.D. 1341 did not abolish, but only changed, the former Philippine College of Commerce into what is now the
Polytechnic University of the Philippines. What took place was a change in academic status of the educational institution,
not in its corporate life. Hence the change in its name, the expansion of its curricular offerings, and the changes in its structure and
organization.
As Crisostomo correctly points out, when the purpose is to abolish a department or an office or an organization and to replace it
with another one, the law-making authority says so. Neither the addition of new course offerings nor changes in its existing
structure and organization bring about the abolition of an educational institution and the creation of a new one—only an express
declaration to that effect by the law-making authority will. PD 1341 states:
“The present Philippine College of Commerce is hereby converted into a university to be known as the “Polytechnic University of
the Philippines,” hereinafter referred to in this Decree as the University.”
NOTE: Nevertheless, reinstatement is no longer possible because of the promulgation of P.D. No. 1437 on June 10, 1978 which
fixed the term of office of presidents of state universities and colleges at 6 years, renewable for another term of 6 years, and
authorizing the President of the Philippines to terminate the terms of incumbents who were not reappointed.
12. Cesar Viola v. Hon. Rafael Alunan III
That Congress can delegate the power to create positions such as these has been settled by our decisions upholding the
validity of reorganization statutes authorizing the President of the Philippines to create, abolish or merge offices in the
executive department.
FACTS
This is a petition for prohibition filed by Cesar G. Viola, Chairman, Barangay 167, Zone 15, District II, Manila challenging
the validity of Article III, Section 1-2 of the Revised Implementing Rules and Guidelines for the general election of the
Liga ng mga Barangay officers in so far as they provide for the election of first, second and third vice presidents and for
auditors of the National Liga ng mga Barangay and its chapter. Petitioner's contention is that the positions in question
are in excess of those provided in the Local Government Code (R.A. No. 7160), §493 of which mentions as elective
positions only those of president, vice president, and five members of the board of directors in each chapter at the
municipal, city, provincial, metropolitan political subdivision, and national levels. Petitioner argues that, in providing
for the positions of first, second and third vice presidents and auditor for each chapter, §§1-2 of the Implementing Rules
expand the number of positions authorized in §493 of the Local Government Code in violation of the principle that
implementing rules and regulations cannot add or detract from the provisions of the law they are designed to
implement.
Whether the additional positions have been created §493. Organization. — The liga at the municipal, city,
without authority of law. provincial, metropolitan political subdivision, and national
levels directly elect a president, a vice-president, and five
(5) members of the board of directors. The board shall
appoint its secretary and treasurer and create such other
positions as it may deem necessary for the management of
the chapter. A secretary-general shall be elected from
among the members of the national liga and shall be
charged with the overall operation of the liga on the
national level. The board shall coordinate the activities of
the chapters of the liga.
HELD
NO. Petitioner's contention that the additional positions in question have been created without authority of law is
untenable. To begin with, the creation of these positions was actually made in the Constitution and By-laws of the Liga
ng mga Barangay, which was adopted by the First Barangay National Assembly on January 11, 1994.
This provision in fact requires — and not merely authorizes — the board of directors to "create such other positions as
it may deem necessary for the management of the chapter" and belies petitioner's claim that said provision (§493) limits
the officers of a chapter to the president, vice president, five members of the board of directors, secretary, and treasurer.
That Congress can delegate the power to create positions such as these has been settled by our decisions upholding the
validity of reorganization statutes authorizing the President of the Philippines to create, abolish or merge offices in the
executive department. The question is whether, in making a delegation of this power to the board of directors of each
chapter of the Liga ng mga Barangay, Congress provided a sufficient standard so that, in the phrase of Justice Cardozo,
administrative discretion may be "canalized within proper banks that keep it from overflowing."
Statutory provisions authorizing the President of the Philippines to make reforms and changes in government owned
or controlled corporations for the purpose of promoting "simplicity, economy and efficiency" in their operations and
empowering the Secretary of Education to prescribe minimum standards of "adequate and efficient instruction" in
private schools and colleges have been found to be sufficient for the purpose of valid delegation. Judged by these cases,
we hold that §493 of the Local Government Code, in directing the board of directors of the liga to "create such other
positions as may be deemed necessary for the management of the chapter[s]," embodies a fairly intelligible standard.
There is no undue delegation of power by Congress.
While the board of directors of a local chapter can create additional positions to provide for the needs of the chapter,
the board of directors of the National Liga must be deemed to have the power to create additional positions not only for
its management but also for that of all the chapters at the municipal, city, provincial and metropolitan political
subdivision levels. Otherwise the National Liga would be no different from the local chapters. There would then be only
so many local chapters without a national one, when what is contemplated in the above-quoted provisions of the LGC
is that there should be one Liga ng mga Barangay with local chapters at all levels of local government units. The dissent,
by denying to the board of directors at the National Liga the power to create additional positions in the local chapters,
would reduce such board to a board of a local hapter. The fact is that §493 grants the power to create positions not only
to the boards of the local chapters but to the board of the Liga at the national level as well.
Indeed what was done in the Constitution and By-laws of their liga was to create additional positions in each chapter,
whether national or local, without however precluding the boards of directors of the chapters as well as that of the
national liga from creating other positions for their peculiar needs. The creation by the board of the National Liga of
the positions of first, second and third vice presidents, auditors and public relations officers was intended to provide
uniform officers for the various chapters in line with the mandate in Art. 210(g)(2) of the Rules and Regulations
Implementing the Local Government Code of 1991 to the Barangay National Assembly to "formulate uniform
constitution and by-laws applicable to the national liga and all local chapters." The various chapters could have different
minor officers depending on their local needs, but they must have the same major elective officers, meaning to say, the
additional vice presidents and auditors.
13. Beja Sr. v. Court of Appeals (G.R. No. 97149, March 31, 1992)
An attached agency has a larger measure of independence from the Department to which it is attached than one which is under
departmental supervision and control or administrative supervision. This is borne out by the "lateral relationship" between the
Department and the attached agency. The attachment is merely for "policy and program coordination."
FACTS
 Beja was employed in PPA and was later on appointed as Terminal Supervisor.
 PPA General Manager Dayan file an Admin case against Beja for grave dishonesty, grave misconduct, wilful violation of
reasonable office rules and regulations for erroneously assessing storage fees resulting in the loss of P38,150.77
on the part of the PPA
 Thereafter, the PPA general manager indorsed it to the AAB for "appropriate action."
 Beja filed a petition for certiorari with preliminary injunction before the Regional Trial Court of Misamis Oriental. At the
CA, Beja’s petition was dismissed.
 Beja now assert that PPA general manager has no power to refer the administrative case filed against him to the DOTC-
AAB, and (d) the DOTC Secretary, the Chairman of the DOTC-AAB and DOTC-AAB itself as an adjudicatory body, have no
jurisdiction to try the administrative case against him.
W/N the DOTC Secretary and/or the AAB may initiate and hear Book IV, Chapter 7 of the Administrative Code of 1987. Sec 38:
administrative cases against PPA personnel below the rank of
Assistant General Manager. "(3) Attachment. — (a) This refers to the lateral relationship
between the department or its equivalent and the attached agency
or coordination. The coordination shall be accomplished by
having the department represented in the governing board of the
attached agency or corporation, either as chairman or as a
member, with or without voting rights, if this is permitted by the
charter; having the attached corporation or agency comply with a
system of periodic reporting which shall reflect the progress of
programs and projects; and having the department or its
equivalent provide general policies through its representative in
the board, which shall serve as the framework for the internal
policies of the attached corporation or agency;
HELD: No. Court qualifiedly rules in favor of petitioner.
The PPA was created through P.D. No. 505 dated July 11, 1974. Under that law, the corporate powers of the PPA were vested in a
governing Board of Directors known as the Philippine Port Authority Council.
On December 23, 1975, P.D. No. 505 was substituted by P.D. No. 857. Sec. 4(a) thereof created the PPA which would be "attached"
to the then Department of Public Works, Transportation and Communication. When EO No. 125 dated January 30, 1987
reorganizing the Ministry of Transportation and Communications was issued, the PPA retained its "attached" status. 10 Even EO
No. 292 or the Administrative Code of 1987 classified the PPA as an agency "attached" to the DOTC. Sec. 24 of Book IV, Title XV,
Chapter 6 of the same Code provides that the agencies attached to the DOTC "shall continue to operate and function in accordance
with the respective charters or laws creating them, except when they conflict with this Code
Attachment of an agency to a Department is one of the three administrative relationships mentioned in Book IV, Chapter 7 of the
Administrative Code of 1987, the other two being supervision and control and administrative supervision. "Attachment" is defined
in Sec. 38.
An attached agency has a larger measure of independence from the Department to which it is attached than one which is under
departmental supervision and control or administrative supervision. This is borne out by the "lateral relationship" between the
Department and the attached agency. The attachment is merely for "policy and program coordination." With respect to
administrative matters, the independence of an attached agency from Departmental control and supervision is further reinforced
by the fact that even an agency under a Department's administrative supervision is free from Departmental interference with
respect to appointments and other personnel actions "in accordance with the decentralization of personnel functions" under the
Administrative Code of 1987. Moreover, the Administrative Code explicitly provides that Chapter 8 of Book IV on supervision and
control shall not apply to chartered institutions attached to a Department.
Hence, the inescapable conclusion is that with respect to the management of personnel, an attached agency is, to a certain extent,
free from Departmental interference and control.
Administrative Agencies (Administrative Relationships)
14. Eugenio v. CSC (G.R. No. 115863. March 31, 1995)
CESB was intended to be an autonomous entity, albeit administratively attached to Civil Service Commission. The purpose of
attaching one functionally inter-related government agency to another is to attain “policy and program coordination.
FACTS
❖ Aida Eugenio, Deputy Director of Philippine Nuclear Research Institute, applied for a Career Executive Service Eligibility
and a CESO rank. She was given a CES eligibility and was recommended to the President for a CESO rank by the CESB.
❖ However, OP refrained from considering her appointment when CESB was abolished and became the Office for Career
Executive Service of the CSC pursuant to CSC Resolution 93-4359. Hence, this petition.
❖ Eugenio claims that CSC usurped the legislative functions of Congress when it abolished the CESB, an office created by law.
❖ CSC averred that the integration of the CESB into the Commission is authorized by law invoking Sec. 17, Chap 3, Book V of
the Admin Code which allows a commission to effect changes in the organization as the need arises.
Whether or not CSC’s abolition of CESB and its integration as Sec. 38(3), Chap. 7, Book IV.
the Office for Career Executive Service of the CSC was valid.
Attachment refers to the lateral relationship between the
department or its equivalent and the attached agency or
corporation for purposes of policy and program coordination.
The coordination may be accomplished by having the
department represented in the governing board of the attached
agency or corporation, either as chairman or as a member, with
or without voting rights, if this is permitted by the charter;
having the attached corporation or agency comply with a
system of periodic reporting which shall reflect the progress of
programs and projects; and having the department or its
equivalent provide general policies through its representative in
the board, which shall serve as the framework for the internal
policies of the attached corporation or agency.
HELD
NO. CSC’s power to reorganize is limited to offices under its control as enumerated in Sec. 16, Chap 3, Book V of the Admin Code.
From its inception, the CESB was intended to be an autonomous entity, albeit administratively attached to CSC. As conceptualized
by the Reorganization Committee “the CESB shall be autonomous. It is expected to view the problem of building up executive
manpower in the government with a broad and positive outlook.” The essential autonomous character of the CESB is not negated
by its attachment to CSC. By said attachment, CESB was not made to fall within the control of CSC.
Under the Administrative Code of 1987, the purpose of attaching one functionally inter-related government agency to another is to
attain “policy and program coordination.” This is clearly etched out in Section 38(3), Chapter 7, Book IV of the Admin Code.
15. Salvador Araneta, etc. et al. v. Hon. Magno Gatmaitan etc, et. Al.
Section 10(1), Article VII of the Constitution of the Philippines prescribes: "SEC. 10(1). The President shall have control
of all the executive departments, bureaus or offices, exercises general supervision over all local governments as may be
provided by law, and take care that the laws be faithfully executed."
Section 63 of the Revised Administrative Code reads as follows: "SEC. 63. EXECUTIVE ORDERS AND EXECUTIVE
PROCLAMATION. — Administrative acts and commands of the President of the Philippines touching the organization
or mode of operation of the Government or rearranging or readjusting any of the districts, divisions, parts or ports of
the Philippines, and all acts and commands governing the general performance of duties by public employees or
disposing of issues of general concern shall be made in executive orders."
FACTS
San Miguel is considered as the most important fishing area in the Pacific side of the Bicol region. Sometime in 1950,
trawl 1 operators from Malabon, Navotas and other places migrated to this region most of them settling at Sabang,
Calabanga, Camarines Sur, for the purpose of using this particular method of fishing in said bay. On account of the
belief of sustenance fishermen that the operation of this kind of gear caused the depletion of the marine resources of
that area, there arose a general clamor among the majority of the inhabitants of coastal towns to prohibit the operation
of trawls in San Miguel Bay. In response to these pleas, the President issued on April 5, 1954, Executive Order
No. 22 (50 Off. Gaz., 1421) prohibiting the use of trawls in San Miguel Bay, but said executive order was amended by
Executive Order No. 66, issued on September 23, 1954 (50 Off. Gaz., 4037), apparently in answer to a resolution of the
Provincial Board of Camarines Sur recommending the allowance of trawl fishing during the typhoon season only. On
November 2, 1954, however, Executive Order No. 80 (50 Off. Gaz., 5198) was issued reviving Executive Order No. 22,
to take effect after December 31, 1954.
Whether the President of the Philippines has authority to "SEC. 13. PROTECTION OF FRY OR FISH EGGS. — Except
issue Executive Orders Nos. 22, 66 and 80, banning the for scientific or educational purpose or for propagation, it
operation of trawls in San Miguel Bay, or, said in other shall be unlawful to take or catch fry or fish eggs and the
small fish, not more than three (3) centimeters long, known
words, whether said Executive Orders Nos. 22, 66 and 80
a s siliniasi, in the territorial waters of the Philippines.
were issued in accordance with law. Towards this end, the Secretary of Agriculture and
Commerce shall be authorized to provide by regulations
such restrictions as may be deemed necessary to be imposed
on THE USE OF ANY FISHING NET OR FISHING DEVICE
FOR THE PROTECTION OF FRY OR FISH EGGS;
Provided, however, That the Secretary of Agriculture and
Commerce shall permit the taking of young of certain
species of fish known as hipon under such restrictions as
may be deemed necessary.
HELD
YES. As may be seen from the just quoted provisions, the law declares unlawful and fixes the penalty for the taking
(except for scientific or educational purposes or for propagation), destroying or killing of any fish fry or fish eggs, and
the Secretary of Agriculture and Commerce (now the Secretary of Agriculture and Natural Resources) is authorized to
promulgate regulations restricting the use of any fish net or fishing device (which includes the net used by trawl
fishermen) for the protection of fry or fish eggs, as well as to set aside and establish fishery reservations or fish refuges
and sanctuaries to be administered in the manner prescribed by him, from which no person could lawfully take, destroy
or kill in any of the places aforementioned, or in any manner disturb or drive away or take therefrom any small or
immature fish, fry or fish eggs.
In virtue of the aforementioned provisions of law and the manifestations just copied, We are of the opinion that with or
without said Executive Orders, the restriction and banning of trawl fishing from all Philippine waters come, under the
law, within the powers of the Secretary of Agriculture and Natural Resources, who in compliance with his duties may
even cause the criminal prosecution of those who in violation of his instructions, regulations or orders are caught fishing
with trawls in Philippine waters. Now, if under the law the Secretary of Agriculture and Natural Resources has authority
to regulate or ban the fishing by trawl which, it is claimed, is obnoxious for it carries away fish eggs and frys which
should be preserved, can the President of the Philippines exercise that same power and authority? Section 10(1), Article
VII of the Constitution of the Philippines prescribes: "SEC. 10(1). The President shall have control of all the executive
departments, bureaus or offices, exercises general supervision over all local governments as may be provided by law,
and take care that the laws be faithfully executed."
Section 63 of the Revised Administrative Code reads as follows: "SEC. 63. EXECUTIVE ORDERS AND EXECUTIVE
PROCLAMATION. — Administrative acts and commands of the President of the Philippines touching the organization
or mode of operation of the Government or rearranging or readjusting any of the districts, divisions, parts or ports of
the Philippines, and all acts and commands governing the general performance of duties by public employees or
disposing of issues of general concern shall be made in executive orders."
Regarding department organization Section 74 of the Revised Administrative Code also provides that: "All executive
functions of the Government of the Republic of the Philippines shall be directly under the Executive Department subject
to the supervision and control of the President of the Philippines in matters of general policy. The Departments are
established for the proper distribution of the work of the Executive, for the performance of the functions expressly
assigned to them by law, and in order that each branch of the administration may have a chief responsible for its
direction and policy. Each Department Secretary shall assume the burden of, and responsibility for, all activities of the
Government under his control and supervision. For administrative purposes the President of the Philippines shall be
considered the Department Head of the Executive Office.". . . .
One of the executive departments is that of Agriculture and Natural Resources which by law is placed under the
direction and control of the Secretary, who exercises its functions subject to the general supervision and control of the
President of the Philippines (Sec. 75, R. A. C.). Moreover, "executive orders, regulations, decrees and proclamations
relative to matters under the supervision or jurisdiction of a Department, the promulgation whereof is expressly
assigned by law to the President of the Philippines, shall as a general rule, be issued upon proposition and
recommendation of the respective Department" (Sec. 79-A, R.A.C.), and there can be no doubt that the promulgation
of the questioned Executive Orders was upon the proposition and recommendation of the Secretary of Agriculture and
Natural Resources and that is why said Secretary, who was and is called upon to enforce said executive Orders, was
made a party defendant in one of the cases at bar (G. R. No. L-9191). For the foregoing reasons The Court do not hesitate
to declare that Executive Orders Nos. 22, 66 and 80, series of 1954, of the President, are valid and issued by authority
of law.
As already held by this Court, the true distinction between delegation of the power to legislate and the conferring of
authority or discretion as to the execution of the law consists in that the former necessarily involves a discretion as to
what the law shall be, while in the latter the authority or discretion as to its execution has to be exercised under and in
pursuance of the law. The first cannot be done; to the latter no valid objection can be made (Cruz vs. Youngberg, 56
Phil., 234, 239. See also Rubi, et al. vs. The Provincial Board of Mindoro, 39 Phil., 660).
In the light of these facts it is clear to Our mind that for the protection of fry or fish eggs and small and immature fishes,
Congress intended with the promulgation of Act No. 4003, to prohibit the use of any fish net or fishing device like trawl
nets that could endanger and deplete our supply of sea food, and to that end authorized the Secretary of Agriculture
and Natural Resources to provide by regulations such restrictions as he deemed necessary in order to preserve the
aquatic resources of the land. Consequently, when the President, in response to the clamor of the people and authorities
of Camarines Sur issued Executive Order No. 80 absolutely prohibiting fishing by means of trawls in all waters
comprised within the San Miguel Bay, he did nothing but show an anxious regard for the welfare of the inhabitants of
said coastal province and dispose of issues of general concern (Sec. 63, R.A.C.) which were in consonance and strict
conformity with the law.
16. Lacson-Magallanes vs Paño (G.R. No. L-27811, November 17, 1967)
The President's duty to execute the law is of constitutional origin. So, too, is his control of all executive departments. Thus it is, that
department heads are men of his confidence. His is the power to appoint them; his, too, is the privilege to dismiss them at pleasure.
Naturally, he controls and directs their acts. Implicit then is his authority to go over, confirm, modify or reverse the action taken by
his department secretaries.
FACTS
❖ Magallanes was an actual occupant of a pasture land in Davao. He ceded his rights to the portion of the land to Magallanes
Co. Thereafter that portion of the land was officially released from the forest zone and declared agricultural land.
❖ Jose Paño and 19 other claimants applied for the purchased of the subject area. The Magallanes Co. also applied for the
purchase of the same land.
❖ Paño protested the application of Magallanes Co. claiming that they are the actual occupant of the said land.
❖ The Director of Lands ruled in favor of Magallanes Co. On appeal the Secretary of Agricultural and Natural Resources also
dismissed the claim of Paño.
❖ The case was then elevated to the President of the Philippines, which the Executive Secretary ruled in favor of Paño and
modified the decision of the Secretary of Agriculture and Natural Resources.
❖ Magallanes Co. filed the present case claiming that "as to questions of fact shall be conclusive when approved" by the
Secretary of Agriculture and Natural Resources.
W/N the President through the executive secretary may modify

the decision of the Secretary of Agriculture and Natural
Resources.
HELD: Yes.
The President's duty to execute the law is of constitutional origin. So, too, is his control of all executive departments. Thus it is, that
department heads are men of his confidence. His is the power to appoint them; his, too, is the privilege to dismiss them at pleasure.
Naturally, he controls and directs their acts. Implicit then is his authority to go over, confirm, modify or reverse the action taken by
his department secretaries. In this context, it may not be said that the President cannot rule on the correctness of a decision of a
department secretary.
Particularly in reference to the decisions of the Director of Lands, as affirmed by the Secretary of Agriculture and Natural Resources,
the standard practice is to allow appeals from such decisions to the Office of the President. This Court has recognized this practice
in several cases. In one, the decision of the Lands Director as approved by the Secretary was considered superseded by that of the
President's on appeal. In other cases, failure to pursue or resort to this last remedy of appeal was considered a fatal defect,
warranting dismissal of the case, for non-exhaustion of all administrative remedies. Parenthetically, it may be stated that the right
to appeal to the President reposes upon the President's power of control over the executive departments. And control simply means
"the power of an officer to alter or modify or nullify or set aside what a subordinate officer had done in the performance of his duties
and to substitute the judgment of the former for that of the latter." This unquestionably negates the assertion that the President
cannot undo an act of his department secretary.
Chief Executive Power to delegate
It is correct to say that constitutional powers there are which the President must exercise in person. Not as correct, however, is it
to say that the Chief Executive may not delegate to his Executive Secretary acts which the Constitution does not command that he
perform in person. Reason is not wanting for this view. The President is not expected to perform in person all the multifarious
executive and administrative functions. The office of the Executive Secretary is an auxiliary unit which assists the President. The
rule which has thus gained recognition is that "under our constitutional setup the Executive Secretary who acts for and in behalf
and by authority of the President has an undisputed jurisdiction to affirm, modify, or even reverse any order" that the Secretary of
Agriculture and Natural Resources, including the Director of Lands, may issue.
Administrative Agencies (Powers of the President)
17. Humphrey’s Estate v. US (295 U.S. 602, 1935)
When Congress provides for the appointment of officers whose functions, like those of the Federal Trade Commissioners, are of
Legislative and judicial quality, rather than executive, and limits the grounds upon which they may be removed from office, the
President has no constitutional power to remove them for reasons other than those so specified.
FACTS
❖ William E. Humphrey, the decedent, was nominated by President Hoover to succeed himself as a member of the Federal
Trade Commission and was confirmed by the United States Senate. He was duly commissioned for a term of 7 years expiring
September 25, 1938; and, after taking the required oath of office, entered upon his duties.
❖ On July 25, 1933, President Roosevelt addressed a letter to Humphrey asking for his resignation, on the ground that “the
aims and purposes of the Administration with respect to the work of the Commission can be carried out most effectively
with personnel of my own selection," but disclaiming any reflection upon the commissioner personally or upon his services.
❖ Humphrey declined to resign, but President Roosevelt nevertheless removed him from the FTC.
❖ Humphrey never acquiesced in this action but continued thereafter to insist that he was still a member of the commission,
entitled to perform its duties and receive the compensation provided by law. (See Sec. 1, FTCA) Hence, his estate sued the
federal government to recover wages earned after he was removed by President Roosevelt.
❖ The federal government, relying on Myers v. US, contended that Sec 1 of the FTCA, is an unconstitutional interference with
the executive power of the President.
1. Do the provisions of Sec. 1 of the FTCA restrict or limit Sec. 1, Federal Trade Commission Act:
the power of the President to remove a commissioner
“xxx Any Commissioner may be removed by the President for
except upon one or more of the causes named? inefficiency, neglect of duty, or malfeasance in office. xxx”
2. If yes, is such a restriction or limitation valid under the
Constitution of the United States?
HELD
1. YES. Congress intended to restrict the power of removal to one or more of those causes.
This construction of the Act is confirmed by a consideration of the character of the Commission -- an independent,
nonpartisan body of experts, charged with duties neither political nor executive, but predominantly
quasi-judicial and quasi-legislative, and by the legislative history of the Act. When Congress provides for the
appointment of officers whose functions, like those of the Federal Trade Commissioners, are of legislative and judicial
quality, rather than executive, and limits the grounds upon which they may be removed from office, the President has no
constitutional power to remove them for reasons other than those so specified.
2. YES. The authority of Congress, in creating quasi-legislative or quasi-judicial agencies, to require them to act in discharge of
their duties independently of executive control cannot well be doubted, and that authority includes, as an appropriate incident,
power to fix the period during which they shall continue in office, and to forbid their removal except for cause in the meantime.
The Myers case dealt with the removal of a postmaster, an executive officer restricted to executive functions and charged
with no duty at all related to either the legislative or the judicial power. Such an officer is merely one of the units in the
executive department, and, hence, inherently subject to the exclusive and illimitable power of removal by the Chief
Executive, whose subordinate he is. That decision goes no farther than to include purely executive officers.
The Federal Trade Commission, in contrast, is an administrative body created by Congress to carry into effect
legislative policies embodied in the statute in accordance with the legislative standard therein prescribed, and to perform
other specified duties as a legislative or as a judicial aid. Such a body cannot in any proper sense be characterized as an arm
or an eye of the executive. Its duties are performed without executive leave, and, in the contemplation of the statute, must
be free from executive control. To the extent that it exercises any executive function -- as distinguished from executive
power in the constitutional sense -- it does so in the discharge and effectuation of its quasi-legislative or quasi-judicial
powers, or as an agency of the legislative or judicial departments of the Government.
18. Louis “Barok” Biraogo v. The Philippine Truth Commission of 2010
Section 31 contemplates "reorganization" as limited by the following functional and structural lines:
1. restructuring the internal organization of the Office of the President Proper by abolishing, consolidating or
merging units thereof or transferring functions from one unit to another;
2. transferring any function under the Office of the President to any other Department/Agency or vice versa; or
3. transferring any agency under the Office of the President to any other Department/Agency or vice versa.
Clearly, the provision refers to reduction of personnel, consolidation of offices, or abolition thereof by reason of
economy or redundancy of functions. These point to situations where a body or an office is already existent but a
modification or alteration thereof has to be effected. The creation of an office is nowhere mentioned, much less
envisioned in said provision. Accordingly, the answer to the question is in the negative.
FACTS
Events prior to the historic May 2010 elections, when then Senator Benigno Simeon Aquino III declared his staunch
condemnation of graft and corruption with his slogan, "Kung walang corrupt, walang mahirap." The Filipino people,
convinced of his sincerity and of his ability to carry out this noble objective, catapulted the good senator to the
presidency. To transform his campaign slogan into reality, President Aquino found a need for a special body to
investigate reported cases of graft and corruption allegedly committed during the previous administration. Thus, at the
dawn of his administration, the President on July 30, 2010, signed Executive Order No. 1 establishing the Philippine
Truth Commission of 2010 (Truth Commission).
Biraogo asserts that the Truth Commission is a public office and not merely an adjunct body of the Office of the
President. Thus, in order that the President may create a public office he must be empowered by the Constitution, a
statute or an authorization vested in him by law. According to petitioner, such power cannot be presumed since there
is no provision in the Constitution or any specific law that authorizes the President to create a truth commission. He
adds that Section 31 of the Administrative Code of 1987, granting the President the continuing authority to reorganize
his office, cannot serve as basis for the creation of a truth commission considering the aforesaid provision merely uses
verbs such as "reorganize," "transfer," "consolidate," "merge," and "abolish." Insofar as it vests in the President the
plenary power to reorganize the Office of the President to the extent of creating a public office, Section 31 is inconsistent
with the principle of separation of powers enshrined in the Constitution and must be deemed repealed upon the
effectivity thereof.
(1) Does the creation of the PTC fall within the ambit Section 32 of the Revised Administrative Code
of the power to reorganize as expressed in Section
31 of the Revised Administrative Code?
(2) Is there a valid delegation of power from
Congress, empowering the President to create a
public office?
HELD
(1) NO.
Section 31 contemplates "reorganization" as limited by the following functional and structural lines:
4. restructuring the internal organization of the Office of the President Proper by abolishing, consolidating or
merging units thereof or transferring functions from one unit to another;
5. transferring any function under the Office of the President to any other Department/Agency or vice versa; or
6. transferring any agency under the Office of the President to any other Department/Agency or vice versa.
Clearly, the provision refers to reduction of personnel, consolidation of offices, or abolition thereof by reason of
economy or redundancy of functions. These point to situations where a body or an office is already existent but a
modification or alteration thereof has to be effected. The creation of an office is nowhere mentioned, much less
envisioned in said provision. Accordingly, the answer to the question is in the negative.
To say that the PTC is borne out of a restructuring of the Office of the President under Section 31 is a misplaced
supposition, even in the plainest meaning attributable to the term "restructure" — an "alteration of an existing
structure." Evidently, the PTC was not part of the structure of the Office of the President prior to the enactment of
Executive Order No. 1. As held in Buklod ng Kawaning EIIB v. Hon. Executive Secretary, But of course, the list of legal
basis authorizing the President to reorganize any department or agency in the executive branch does not have to end
here. The Court must not lose sight of the very source of the power — that which constitutes an express grant of power.
Under Section 31, Book III of Executive Order No. 292 (otherwise known as the Administrative Code of 1987), "the
President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall
have the continuing authority to reorganize the administrative structure of the Office of the President." For this purpose,
he may transfer the functions of other Departments or Agencies to the Office of the President. In Canonizado v. Aguirre
[323 SCRA 312 (2000)], we ruled that reorganization "involves the reduction of personnel, consolidation of offices, or
abolition thereof by reason of economy or redundancy of functions." It takes place when there is an alteration of the
existing structure of government offices or units therein, including the lines of control, authority and responsibility
between them. The EIIB is a bureau attached to the Department of Finance. It falls under the Office of the President.
Hence, it is subject to the President's continuing authority to reorganize.
In the same vein, the creation of the PTC is not justified by the President's power of control. Control is essentially the
power to alter or modify or nullify or set aside what a subordinate officer had done in the performance of his duties and
to substitute the judgment of the former with that of the latter. Clearly, the power of control is entirely different from
the power to create public offices. The former is inherent in the Executive, while the latter finds basis from either a valid
delegation from Congress, or his inherent duty to faithfully execute the laws.
(2) YES.
While the power to create a truth commission cannot pass muster on the basis of P.D. No. 1416 as amended by P.D. No.
1772, the creation of the PTC finds justification under Section 17, Article VII of the Constitution, imposing upon the
President the duty to ensure that the laws are faithfully executed. Section 17 reads: Section 17. The President shall have
control of all the executive departments, bureaus, and offices. He shall ensure that the laws be faithfully executed.
As correctly pointed out by the respondents, the allocation of power in the three principal branches of government is a
grant of all powers inherent in them. The President's power to conduct investigations to aid him in ensuring the faithful
execution of laws — in this case, fundamental laws on public accountability and transparency — is inherent in the
President's powers as the Chief Executive. That the authority of the President to conduct investigations and to create
bodies to execute this power is not explicitly mentioned in the Constitution or in statutes does not mean that he is bereft
of such authority.
19. Mangune vs Executive Secretary Ermita (G.R. No. 182604, September 27, 2016)
The President may, by executive or administrative order, direct the reorganization of government entities under the executive
department. This is sanctioned under the Constitution, as well as other statutes.
FACTS
 R.A. No. 7842 was enacted establishing, under the administration and supervision of the DOH, the Taguig-Pateros District
Hospital (TPDH). President Arroyo issued E.O. No. 567 devolving the administration and supervision of TPDH from the
DOH to the City of Taguig.
 Employees of the DOH assigned to the TPDH, submitted a position paper to the then Secretary of Health, respondent Hon.
Francisco Duque III (Secretary Duque), expressing their objections to E.O. No. 567.
 The position paper was received by the Office of the Secretary on November 6, 2006. However, the DOH did not act on the
Position Paper. Petitioners also wrote a letter to the Office of the President requesting the deferment of the implementation
of E.O. No. 567, which also took no action.
 A petition for Declaratory Relief against respondents in the RTC of Manila was filed by Mangune et al. RTC denied the
petition hence this case.
 Respondents counter claim is that E.O. No. 567 is within the President's constitutional power of control over government
entities in the executive department, her continuing authority to reorganize the administrative structure of the Of9ce of the
President and her constitutional duty to ensure that the laws are faithfully executed.
W/N it is within the authority of the President to transfer the

management of TPDH to Taguig City.
HELD: Yes.
E.O. No. 567 is within the constitutional power of the President to issue. The President may, by executive or administrative order,
direct the reorganization of government entities under the executive department. This is sanctioned under the Constitution, as well
as other statutes.
In Tondo Medical Center Employees Association v. Court of Appeals, petitioners questioned the validity of Executive Order No. 102
(E.O. No. 102) issued by then President Joseph Ejercito Estrada which, also pursuant to Section 17 of the Local Government Code,
provided for the changes in the roles, functions, and organizational processes of the DOH. Petitioners alleged that E.O. No. 102 was
void on the ground that it was issued in excess of the President's authority, as the structural and functional reorganization of the
DOH is a legislative function. In rejecting petitioners' argument, we held that the issuance of E.O. No. 102 is an exercise of the
President's constitutional power of control over the executive department, supported by the provisions of the Administrative Code,
recognized by other statutes, and consistently affimed by this Court.
Similarly, in Malaria Employees and Workers Association of the Philippines, Inc. v. Romulo, where the issue is also the validity of
E.O. No. 102, we reiterated that the President has the authority to carry out a reorganization of the DOH under the Constitution
and other statutory laws.
Our ruling in the above cases applies squarely in this case. The transfer of the administration and supervision of TPDH from the
DOH to the City of Taguig is a result of the President's exercise of her power of control over the executive department, including
the DOH. HES
The Constitution declares it a policy of the State to ensure the autonomy of local governments while Section 17 of the Local
Government Code secures to the local governments the genuine and meaningful autonomy that would develop them into self-
reliant communities and effective partners in the attainment of national goals. Therefore, in issuing E.O. No. 567, the President
was actually carrying out the provisions of the Constitution and the Local Government Code. She was performing her duty to ensure
the faithful execution of the laws.
Administrative Agencies (Power to Create Public Office and Reorganize)
20. Pichay v. Executive Secretary (G.R. No. 196425. July 24, 2012)
The abolition of the Presidential Anti-Graft Commission (PAGC) and the transfer of its functions to a division specially created
within the Office of the Deputy Executive Secretary for Legal Affairs (ODESLA) is properly within the prerogative of the President
under his continuing “delegated legislative authority to reorganize” his own office pursuant to E.O. 292.
FACTS
❖ President Benigno Aquino III issued EO 13, abolishing PAGC and transferring its functions to ODESLA, more particularly
to its newly-established Investigative and Adjudicatory Division (IAD).
❖ Finance Secretary Purisima filed before IAD-ODESLA a complaint-affidavit for grave misconduct against Prospero Pichay,
Board of Trustees Chairman, and other incumbent members of the BOT of the Local Water Utilities Administration
(LWUA), which arose from the purchase by LWUA of 445, 377 shares of stock of Express Savings Bank. Hence, this petition.
❖ Pichay seeks to declare EO 13 as unconstitutional for usurping the legislative’s power to create a public office. He claims
that the President is not authorized under any existing law to create the IAD-ODESLA.
Whether or not the President has authority to abolish PAGC Sec. 31, Chap 10, Title III, Book III – Continuing Authority of
and to create the IAD-ODESLA. the President to Reorganize his Office
The President, subject to the policy in the Executive Office and in order
to achieve simplicity, economy and efficiency, shall have
continuing authority to reorganize the admin structure of the Office of
the President. For this purpose, he may take any of the following actions:
(1) Restructure the internal organization of the Office of the
President Proper, including the immediate Offices, the Presidential
Special Assistants/Advisers System and the Common Staff Support
System, by abolishing, consolidating, or merging units thereof or
transferring functions from one unit to another
(2) Transfer any function under the Office of the President to any other
Department or Agency as well as transfer functions to the Office of the
President from other Departments and Agencies
(3) Transfer any agency under the Office of the President to any other
Department or Agency as well as transfer agencies to the Office of the
President from other departments or agencies
HELD
YES. The President has continuing authority to reorganize the Executive Department under E.O. 292.
The abolition of the PAGC and the transfer of its functions to a division specially created within the ODESLA is properly within the
prerogative of the President under his continuing “delegated legislative authority to reorganize” his own office pursuant
to E.O. 292. Generally, this authority to implement organizational changes is limited to transferring either an office or a function
from the Office of the President to another Department or Agency, and the other way around. Only Section 31(1) gives the President
a virtual freehand in dealing with the internal structure of the Office of the President Proper by allowing him to take actions
as extreme as abolition, consolidation or merger of units, apart from the less drastic move of transferring functions and
offices from one unit to another. Since both PAGC and ODESLA belong to the Office of the President Proper, the reorganization by
way of abolishing the PAGC and transferring its functions to the ODESLA is allowable under Sec. 31 (1).
The abolition of PAGC did not require the creation of a new, additional and distinct office as the duties and functions
that pertained to the defunct anti-graft body were simply transferred ODESLA, which is an existing office within the Office of the
President Proper. The reorganization required no more than a mere alteration of the administrative structure of the ODESLA
through the establishment of a 3rd division—the Investigative and Adjudicatory Division—through which ODESLA could take on
the additional functions it has been tasked to discharge.
A reorganization is said to be carried out in good faith if it is done for purposes of economy and efficiency. In this case, the
streamlining of functions within the OP Proper was pursued with such purposes in mind. In its Whereas clauses, E.O. 13 cites as
bases for the reorganization the policy dictates of eradicating corruption in the government and promoting economy
and efficiency in the bureaucracy.
21. MEWAP et al v. Secretary Romulo
Be that as it may, the President must exercise good faith in carrying out the reorganization of any branch or agency of
the executive department. Reorganization is effected in good faith if it is for the purpose of economy or to make
bureaucracy more efficient. R.A. No. 6656 provides for the circumstances which may be considered as evidence of bad
faith in the removal of civil service employees made as a result of reorganization, to wit: (a) where there is a significant
increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) where an
office is abolished and another performing substantially the same functions is created; (c) where incumbents are
replaced by those less qualified in terms of status of appointment, performance and merit; (d) where there is a
classification of offices in the department or agency concerned and the reclassified offices perform substantially the
same functions as the original offices; and (e) where the removal violates the order of separation.
FACTS
On October 19, 1999, the President issued E.O. No. 165 "Directing the Formulation of an Institutional Strengthening
and Streamlining Program for the Executive Branch" which created the Presidential Committee on Executive
Governance (PCEG) composed of the Executive Secretary as chair and the Secretary of the Department of Budget and
Management (DBM) as co-chair. The DBM, on July 8, 2000, issued the Notice of Organization, Staffing and
Compensation Action (NOSCA). On July 17, 2000, the PCEG likewise issued Memorandum Circular (M.C.) No. 62,
entitled "Implementing Executive Order No. 102, Series of 1999 Redirecting the Functions and Operations of the
Department of Health." 2 M.C. No. 62 directed the rationalization and streamlining of the said Department.
On July 28, 2000, the Secretary of Health again issued Department Circular No. 221, Series of 2000, stating that the
Department will start implementing the Rationalization and Streamlining Plan by a process of selection, placement or
matching of personnel to the approved organizational chart and the list of the approved plantilla items. The Secretary
also issued Administrative Order (A.O.) No. 94, Series of 2000, which set the implementing guidelines for the
restructuring process on personnel selection and placement, retirement and/or voluntary resignation. A.O. No. 94
outlined the general guidelines for the selection and placement of employees adopting the procedures and standards
set forth in R.A. No. 6656 4 or the "Rules on Governmental Reorganization", Civil Service Rules and Regulations,
Sections 76 to 78 of the GAA for the Year 2000, and Section 42 of E.O. No. 292.
Petitioner Malaria Employees and Workers Association of the Philippines, Inc. (MEWAP) is a union of affected
employees in the Malaria Control Service of the Department of Health. MEWAP filed a complaint, docketed as Civil
Case No. 00-98793, with the Regional Trial Court of Manila seeking to nullify Department Memorandum No. 157, the
NOSCA and the Placement List of Department of Health Personnel and other issuances implementing E.O. No. 102.
Whether the President has authority to effect a Section 1. The executive power shall be vested in the
reorganization of a department under the Executive President of the Philippines.
Branch.
Section 17. The President shall have control of all the
executive departments, bureaus and offices. He shall ensure
that the laws be faithfully executed.
HELD
YES. The President has the authority to carry out a reorganization of the Department of Health under the Constitution
and statutory laws. This authority is an adjunct of his power of control. In Canonizado v. Aguirre, the Court held that
reorganization "involves the reduction of personnel, consolidation of offices, or abolition thereof by reason of economy
or redundancy of functions." It alters the existing structure of government offices or units therein, including the lines
of control, authority and responsibility between them. While the power to abolish an office is generally lodged with the
legislature, the authority of the President to reorganize the executive branch, which may include such abolition, is
permissible under our present laws, viz.: The general rule has always been that the power to abolish a public office is
lodged with the legislature. This proceeds from the legal precept that the power to create includes the power to destroy.
A public office is either created by the Constitution, by statute, or by authority of law. Thus, except where the office was
created by the Constitution itself, it may be abolished by the same legislature that brought it into existence.
The exception, however, is that as far as bureaus, agencies or offices in the executive department are concerned, the
President's power of control may justify him to inactivate the functions of a particular office, or certain laws may grant
him the broad authority to carry out reorganization measures. The President's power to reorganize the executive branch
is also an exercise of his residual powers under Section 20, Title I, Book III of E.O. No. 292 which grants the President
broad organization powers to implement reorganization measures, viz.: SEC. 20. Residual Powers. — Unless Congress
provides otherwise, the President shall exercise such other powers and functions vested in the President which are
provided for under the laws and which are not specifically enumerated above, or which are not delegated by the
President in accordance with law.
The pertinent provisions of Presidential Decree No. 1416, as amended by Presidential Decree No. 1772, clearly support
the President's continuing power to reorganize the executive branch, viz.: 1. The President of the Philippines shall have
continuing authority to reorganize the National Government. In exercising this authority, the President shall be guided
by generally acceptable principles of good government and responsive national development, including but not limited
to the following guidelines for a more efficient, effective, economical and development-oriented governmental
framework: xxx b) Abolish departments, offices, agencies or functions which may not be necessary, or create those
which are necessary, for the efficient conduct of government functions, services and activities; c) Transfer functions,
appropriations, equipment, properties, records and personnel from one department, bureau, office, agency or
instrumentality to another; d) Create, classify, combine, split, and abolish positions; e) Standardize salaries, materials,
and equipment; f) Create, abolish, group, consolidate, merge, or integrate entities, agencies, instrumentalities, and
units of the National Government, as well as expand, amend, change, or otherwise modify their powers, functions, and
authorities, including, with respect to government-owned or controlled corporations, their corporate life, capitalization,
and other relevant aspects of their charters; g) Take such other related actions as may be necessary to carry out the
purposes and objectives of this Decree.
In fact, as pointed out by respondents, the President's power to reorganize the executive department even finds further
basis under Sections 78 and 80 of R.A. No. 8522, viz.: Section 78. Organizational Changes — Unless otherwise provided
by law or directed by the President of the Philippines, no organizational unit or changes in key positions in any
department or agency shall be authorized in their respective organizational structure and funded from appropriations
provided by this Act. Section 80. Scaling Down and Phase-out of Activities of Agencies within the Executive Branch —
The heads of departments, bureaus, offices and agencies are hereby directed to identify their respective activities which
are no longer essential in the delivery of public services and which may be scaled down, phased-out or abolished subject
to Civil Service rules and regulations. Said activities shall be reported to the Office of the President through the
Department of Budget and Management and to the Chairman, Committee on Appropriations of the House of
Representatives and the Chairman, Committee on Finance of the Senate. Actual scaling down, phase-out or abolition
of the activities shall be effected pursuant to Circulars or Orders issued for the purpose by the Office of the President.
Be that as it may, the President must exercise good faith in carrying out the reorganization of any branch or agency of
the executive department. Reorganization is effected in good faith if it is for the purpose of economy or to make
bureaucracy more efficient. R.A. No. 6656 provides for the circumstances which may be considered as evidence of bad
faith in the removal of civil service employees made as a result of reorganization, to wit: (a) where there is a significant
increase in the number of positions in the new staffing pattern of the department or agency concerned; (b) where an
office is abolished and another performing substantially the same functions is created; (c) where incumbents are
replaced by those less qualified in terms of status of appointment, performance and merit; (d) where there is a
classification of offices in the department or agency concerned and the reclassified offices perform substantially the
same functions as the original offices; and (e) where the removal violates the order of separation.
22. Anak Mindanao Party List vs Executive Secretary Ermita (G.R. No. 166052, August 29, 2007)
The Constitution's express grant of the power of control in the President justifies an executive action to carry out reorganization
measures under a broad authority of law.
FACTS
 President Arroyo issued E.O. 364 transforming the DAR to Department of Land Reform. This E.O was later on amended.
The amendment contains a provision that the National Commission on Indigenous People (NCIP) shall be an attached
agency of the Department of Land Reform.
 Petitioners filed a petition questioning the validity of the said issuances. However, the issue on the transformation of the
DAR into the DLR became moot and academic, however, the department having reverted to its former name by virtue of
E.O. No. 456.
 The Court is thus left with the sole issue of the legality of placing the PCUP under the supervision and control of the DAR,
and the NCIP under the DAR as an attached agency because Anak Mindanao contends that AR, PCUP and NCIP were
created by statutes, they can only be transformed, merged or attached by statutes, not by mere executive orders.
W/N the President has the authority, through an executive order place Administrative Code of 1987 SEC. 31. Continuing Authority of the
NCIP as attached agency of DAR. President to Reorganize his Office. — The President, subject to the
policy in the Executive Office and in order to achieve simplicity,
economy and efficiency, shall have continuing authority to
reorganize the administrative structure of the Office of the
President. For this purpose, he may take any of the following
actions:
(1) Restructure the internal organization of the Office of the
President Proper, including the immediate Offices, the
Presidential Special Assistants/Advisers System and the
Common Staff Support System, by abolishing, consolidating, or
merging units thereof or transferring functions from one unit to
another;
(2) Transfer any function under the Office of the President to any
other Department or Agency as well as transfer functions to the
Office of the President from other Departments and Agencies;
(3) Transfer any agency under the Office of the President to any
other department or agency as well as transfer agencies to the
Office of the President from other departments or agencies.
HELD: Yes.
The Constitution confers, by express provision, the power of control over executive departments, bureaus and offices in the
President alone. And it lays down a limitation on the legislative power. Corollary to the power of control, the President also has the
duty of supervising and 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. The Constitution's
express grant of the power of control in the President justifies an executive action to carry out reorganization measures under a
broad authority of law. In enacting a statute, the legislature is presumed to have deliberated with full knowledge of all existing laws
and jurisprudence on the subject. It is thus reasonable to conclude that in passing a statute which places an agency under the Office
of the President, it was in accordance with existing laws and jurisprudence on the President's power to reorganize. In establishing
an executive department, bureau or office, the legislature necessarily ordains an executive agency's position in the scheme of
administrative structure. Such determination is primary, but subject to the President's continuing authority to reorganize the
administrative structure. As far as bureaus, agencies or offices in the executive department are concerned, the power of control may
justify the President to deactivate the functions of a particular office. Or a law may expressly grant the President the broad authority
to carry out reorganization measures.
In transferring the NCIP to the DAR as an attached agency, the President effectively tempered the exercise of presidential authority
and considerably recognized that degree of independence. The Administrative Code of 1987 categorizes administrative
relationships into (1) supervision and control, (2) administrative supervision, and (3) attachment. With respect to the third
category, it has been held that an attached agency has a larger measure of independence from the Department to which it is attached
than one which is under departmental supervision and control or administrative supervision. This is borne out by the "lateral
relationship" between the Department and the attached agency. The attachment is merely for "policy and program coordination."
Indeed, the essential autonomous character of a board is not negated by its attachment to a commission.
23. Domingo v. Zamora (G.R. No. 142283. February 6, 2003)
Since EO 81 is based on the President’s continuing authority under Section 31 (2) and (3) of EO 292, EO 81 is a valid exercise of
the President’s delegated power to reorganize the Office of the President. The law grants the President this power in recognition
of the recurring need of every President to reorganize his office “to achieve simplicity, economy and efficiency.”
FACTS
❖ President Joseph Estrada issued EO 81 transferring the sports development programs and activities of the Department of
Education, Culture and Sports (DECS) to the Philippine Sports Commission (PSC).
❖ Pursuant to this, DECS Secretary Andrew Gonzales issued 2 memorandums reassigning, at first temporarily then later
permanently, the BPESS1 Staff to various offices within the DECS. Dissatisfied with their reassignment, petitioners filed
this instant petition.
❖ Petitioners seek to nullify EO 81 claiming that it violated the principle of separation of powers. They also claim that the
issuance of DECS Memo violated their right to security of tenure.
❖ During the pendency of the case, RA 9155 was enacted expressly abolishing the BPESS and transferring the functions,
programs, and activities of DECS relating to sports competition to PSC. Sec. 9 thereof states that the BPESS personnel,
detailed with PSC, are hereby transferred to PSC without loss of rank and all other personnel shall be retained by DECS.
Whether or not President Estrada’s issuance of EO 81 is a Sec. 31, Chap 10, Title III, Book III – Continuing Authority of
valid act. the President to Reorganize his Office
The President, subject to the policy in the Executive Office and in order
to achieve simplicity, economy and efficiency, shall have
(1) Restructure the internal organization of the Office of the President
Proper, including the immediate Offices, the Presidential Special
Assistants/Advisers System and the Common Staff Support System, by
abolishing, consolidating, or merging units thereof or transferring
functions from one unit to another
(2) Transfer any function under the Office of the President to
any other Department or Agency as well as transfer functions to the
Office of the President from other Departments and Agencies
(3) Transfer any agency under the Office of the President to
any other Department or Agency as well as transfer agencies to the
Office of the President from other departments or agencies
HELD
YES. Since EO 81 is based on the President’s continuing authority under Section 31 (2) and (3) of EO 292, EO 81 is a valid
exercise of the President’s delegated power to reorganize the Office of the President. The law grants the President this power in
recognition of the recurring need of every President to reorganize his office “to achieve simplicity, economy and efficiency.”
The President’s power to reorganize the OP under Sec. 31 (2) and (3) should be distinguished from his power to reorganize the
Office of the President Proper. Under Sec. 31 (1), the President can reorganize the OP Proper by abolishing, consolidating or merging
units, or by transferring functions from one unit to another. In contrast, under Sec. 31 (2) and (3), the President’s power to
reorganize offices outside the OP Proper but still within the OP is limited to merely transferring functions or agencies from the
Office of the President to Departments or Agencies, and vice versa.
This distinction is crucial as it affects the security of tenure of employees. The abolition of an office in good faith necessarily results
in the employee’s cessation in office, but in such event, there is no dismissal or separation because the office itself ceases to exist.
On the other hand, the transfer of functions or agencies does not result in the employee’s cessation in office because his office
continues to exist although in another department, agency, or office. In this case, the BPESS employees who were not transferred
to PSC were at first temporarily, then later permanently assigned to other offices of the DECS, ensuring their continued
employment.
NOTE: In view of the enactment of RA 9155 (Governance of Basic Education Act of 2001), the petition was dismissed for being
moot and academic.
1 Bureau of Physical Education and School Sports (BPESS)

24. Drianita Bagaoisan et al v. National Tobacco Administration
Article VII, Section 17, of the Constitution, expressly grants the President control of all executive departments, bureaus,
agencies and offices which may justify an executive action to inactivate the functions of a particular office or to carry
out reorganization measures under a broad authority of law. Section 78 of the General Provisions of Republic Act No.
8522 (General Appropriations Act of FY 1998) has decreed that the President may direct changes in the organization
and key positions in any department, bureau or agency pursuant to Article VI, Section 25, of the Constitution, which
grants to the Executive Department the authority to recommend the budget necessary for its operation. Evidently, this
grant of power includes the authority to evaluate each and every government agency, including the determination of
the most economical and efficient staffing pattern, under the Executive Department.
FACTS
President Joseph Estrada issued on 30 September 1998 Executive Order No. 29, entitled "Mandating the Streamlining
of the National Tobacco Administration (NTA)," a government agency under the Department of Agriculture. The order
was followed by another issuance, on 27 October 1998, by President Estrada of Executive Order No. 36, amending
Executive Order No. 29, insofar as the new staffing pattern was concerned, by increasing from four hundred (400) to
not exceeding seven hundred fifty (750) the positions affected thereby. In compliance therewith, the NTA prepared and
adopted a new Organization Structure and Staffing Pattern (OSSP) which, on 29 October 1998, was submitted to the
Office of the President. On 10 June 1996, petitioners, all occupying different positions (rank and file) at the NTA office
in Batac, Ilocos Norte, received individual notices of termination of their employment with the NTA effective thirty (30)
days from receipt thereof.
Whether NTA may be reorganized by an executive fiat Sec. 20. Residual Powers. — Unless Congress provides
not a legislative action. otherwise, the President shall exercise such other powers
and functions vested in the President which are provided
for under the laws and which are not specifically
enumerated above or which are not delegated by the
President in accordance with law.'
HELD
YES. It is important to emphasize that the questioned Executive Orders No. 29 and No. 36 have not abolished the
National Tobacco Administration but merely mandated its reorganization through the streamlining or reduction of its
personnel. Article VII, Section 17, of the Constitution, expressly grants the President control of all executive
departments, bureaus, agencies and offices which may justify an executive action to inactivate the functions of a
particular office or to carry out reorganization measures under a broad authority of law. Section 78 of the General
Provisions of Republic Act No. 8522 (General Appropriations Act of FY 1998) has decreed that the President may direct
changes in the organization and key positions in any department, bureau or agency pursuant to Article VI, Section 25,
of the Constitution, which grants to the Executive Department the authority to recommend the budget necessary for its
operation. Evidently, this grant of power includes the authority to evaluate each and every government agency,
including the determination of the most economical and efficient staffing pattern, under the Executive Department.
In the recent case of Rosa Ligaya C. Domingo, et al. vs. Hon. Ronaldo D. Zamora, in his capacity as the Executive
Secretary, et al. , this Court has had occasion to also delve on the President's power to reorganize the Office of the
President under Section 31(2) and (3) of Executive Order No. 292 and the power to reorganize the Office of the President
Proper. The Court has there .observed: ". . . .Under Section 31(1) of EO 292, the President can reorganize the Office of
the President Proper by abolishing, consolidating or merging units, or by transferring functions from one unit to
another. In contrast, under Section 31(2) and (3) of EO 292, the President's power to reorganize offices outside the
Office of the President Proper but still within the Office of the President is limited to merely transferring functions or
agencies from the Office of the President to Departments or Agencies, and vice versa."
The provisions of Section 31, Book III, Chapter 10, of Executive Order No. 292 (Administrative Code of 1987), above-
referred to, reads thusly: "SEC. 31. Continuing Authority of the President to Reorganize his Office. — The President,
subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have
continuing authority to reorganize the administrative structure of the Office, of the President. For this purpose, he may
take any of the following actions: "(1) Restructure the internal organization of the Office of the President Proper,
including the immediate Offices, the Presidential Special Assistants/Advisers System and the Common Staff Support
System, by abolishing, consolidating or merging units thereof or transferring function from one unit to another; "(2)
Transfer any function under the Office of the President to any other Department or Agency as well as transfer functions
to the Office of the President from other Departments and Agencies; and "(3) Transfer any agency under the Office of
the President to any other department or agency as well as transfer agencies to the Office of the President from other
departments and agencies."
The first sentence of the law is an express grant to the President of a continuing authority to reorganize the
administrative structure of the Office of the President. The succeeding numbered paragraphs are not in the nature of
provisos that unduly limit the aim and scope of the grant to the President of the power to reorganize but are to be viewed
in consonance therewith. Section 31(1) of Executive Order No. 292 specifically refers to the President's power to
restructure the internal organization of the Office of the President Proper, by abolishing, consolidating or merging units
hereof or transferring functions from one unit to another, while Section 31(2) and (3) concern executive offices outside
the Office of the President Proper allowing the President to transfer any function under the Office of the President to
any other Department or Agency and vice-versa, and the transfer of any agency under the Office of the President to any
other department or agency and vice-versa.
In the present instance, involving neither an abolition nor transfer of offices, the assailed action is a mere reorganization
under the general provisions of the law consisting mainly of streamlining the NTA in the interest of simplicity, economy
and efficiency. It is an act well within the authority of President motivated and carried out, according to the findings of
the appellate court, in good faith, a factual assessment that this Court could only but accept.
25. Buklod ng Kawaning EIIB vs Executive Secretary Zamora (G.R. No. 142801-802, July 10, 2001)
"the President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have
the continuing authority to reorganize the administrative structure of the Office of the President."
FACTS
 President Corazon C. Aquino, issued EO No. 127 establishing the Economic Intelligence and Investigation Bureau (EIIB)
as part of the structural organization of the Ministry of Finance.
 President Joseph Estrada issued EO No. 191 entitled "Deactivation of the EIIB" Motivated by the fact that "the designated
functions of the EIIB are also being performed by the other existing agencies of the government" and that "there is a need
to constantly monitor the overlapping of functions" among these agencies, former President Estrada ordered the
deactivation of EIIB and the transfer of its functions to the Bureau of Customs and the National Bureau of Investigation.
 President Estrada issued EO No. 223 providing that all EIIB personnel occupying positions specified therein shall be
deemed separated from the service effective April 30, 2000, pursuant to a bona fide reorganization resulting to abolition,
redundancy, merger, division, or consolidation of positions.
 Hence the present petition. Petitioners contend that the issuance of the afore-mentioned executive orders is: (a) a violation
of their right to security of tenure; (b) tainted with bad faith as they were not actually intended to make the bureaucracy
more efficient but to give way to Task Force "Aduana," the functions of which are essentially and substantially the same as
that of EIIB.
W/N the President has the authority reorganize the executive Section 31, Book III of Administrative Code of 1987, "the
department. President, subject to the policy in the Executive Office and in
order to achieve simplicity, economy and efficiency, shall have the
continuing authority to reorganize the administrative structure of
the Office of the President."
HELD: Yes.
Surely, there exists a distinction between the words "deactivate" and "abolish." To "deactivate" means to render inactive or
ineffective or to break up by discharging or reassigning personnel, while to "abolish" means to do away with, to annul, abrogate or
destroy completely. In essence, abolition denotes an intention to do away with the office wholly and permanently. Thus, while in
abolition, the office ceases to exist, the same is not true in deactivation where the office continues to exist, albeit remaining dormant
or inoperative. Be that as it may, deactivation and abolition are both reorganization measures.
The general rule has always been that the power to abolish a public office is lodged with the legislature. This proceeds from the legal
precept that the power to create includes the power to destroy. A public office is either created by the Constitution, by statute, or
by authority of law. Thus, except where the office was created by the Constitution itself, it may be abolished by the same legislature
that brought it into existence. The exception, however, is that as far as bureaus, agencies or offices in the executive department are
concerned, the President's power of control may justify him to inactivate the functions of a particular office, or certain laws may
grant him the broad authority to carry out reorganization measures.
But of course, the list of legal basis authorizing the President to reorganize any department or agency in the executive branch does
not have to end here. We must not lose sight of the very source of the power — that which constitutes an express grant of power.
Under Section 31, Book III of Executive Order No. 292 (otherwise known as the Administrative Code of 1987), "the President,
subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency, shall have the continuing
authority to reorganize the administrative structure of the Office of the President." For this purpose, he may transfer the functions
of other Departments or Agencies to the Office of the President. In Canonizado v. Aguirre, we ruled that reorganization "involves
the reduction of personnel, consolidation of offices, or abolition thereof by reason of economy or redundancy of functions." It takes
place when there is an alteration of the existing structure of government offices or units therein, including the lines of control,
authority and responsibility between them. The EIIB is a bureau attached to the Department of Finance. It falls
under the Office of the President. Hence, it is subject to the President's continuing authority to reorganize
26. Dario v. Mison (G.R. No. 81954. August 8, 1989)
Reorganizations abolishing an office would only be valid if it passes the test of good faith. A reorganization carried out in good
faith must have for its purpose the efficiency of both the economy and bureaucracy.
FACTS
❖ Pres. Aquino promulgated Proclamation No. 3, providing for the intention of the President to, “completely reorganize the
government, eradicate unjust and oppressive structures, and all iniquitous vestiges of the previous regime.” Subsequently,
Pres. Aquino promulgated E.O. No. 127, “Reorganizing the Ministry of Finance”, where, in Sec. 59, it provided for the
reorganization of the Bureau of Customs. Pursuant to the reorganization, Commissioner Mison issued separation notices
to a total of 394 officials, including the petitioner, Cesar Dario, in his capacity as Deputy Commissioner.
❖ Thus, Cesar Dario, BOC Deputy Commissioner, petitioned for reinstatement on the ground that the Provisional
Constitution giving the power to dismiss public officials without cause ended on February 25, 1987, seeing as the public
officials enjoyed security of tenure under the provisions of the 1987 Constitution.
❖ However, Commissioner Mison contended that Sec. 16, Article XVIII (Transitory Provisions) allows the reorganization of
the Bureau of Customs under E.O. No. 127 (authorizing separation without cause) to continue even after the ratification of
the 1987 Constitution – citing the case of Jose v. Arroyo, wherein the Court decided in favor of a similar notion. Thus, there
was no violation of security of tenure.
❖ The Civil Service Commission, nevertheless, ordered the reinstatement of the petitioner. Whereas, the Commissioner
Mison motioned for reconsideration.
Whether or not Executive Order No. 127, which provided for Sec. 31, Chap 10, Title III, Book III – Continuing Authority of
the reorganization of the Bureau of Customs, allow the the President to Reorganize his Office
“separation” of Dario from the Bureau of Customs despite his The President, subject to the policy in the Executive Office and in order
right to security of tenure under the 1987 Constitution. to achieve simplicity, economy and efficiency, shall have
(1) Restructure the internal organization of the Office of the President
Proper, including the immediate Offices, the Presidential Special
Assistants/Advisers System and the Common Staff Support System, by
abolishing, consolidating, or merging units thereof or transferring
functions from one unit to another
(2) Transfer any function under the Office of the President to
any other Department or Agency as well as transfer functions to the
Office of the President from other Departments and Agencies
(3) Transfer any agency under the Office of the President to
any other Department or Agency as well as transfer agencies to the
Office of the President from other departments or agencies
HELD
NO. E.O. No. 127, providing reorganization, does not allow the “separation” of Dario from the Bureau of Customs
despite his right to security of tenure under the 1987 Constitution.
We must distinguish removals from separations arising from abolition of office (not by virtue of the Constitution) as a result of
reorganization carried out by reason of economy or to remove redundancy of functions. In “separations”, the Government is obliged
to prove good faith. In case of “removals” undertaken to comply with clear and explicit constitutional mandates, the Government
is not hard put to prove anything, plainly and simply because the Constitution allows it.
Reorganization entails that an office is abolished, thus there actually no separation or dismissal such that these concepts imply that
there is an office to be separated from. However, the Court asserts that, reorganizations abolishing an office would only be valid if
it passes the test of good faith. A Reorganization carried out in good faith must have for its purpose the efficiency of both the
economy and bureaucracy. In this case, there is lack of good faith such that there is no showing that legitimate structural changes
were made, only that personnel were reduced. Thus, it cannot be said that it was done by reason of economy or redundancy of
functions. Thus, since there is lack of good faith, there is no valid reorganization that would allow the “separation” of the petitioners,
in keeping with their security of tenure. The act of reorganization of the Bureau of Customs dismissing Dario is unconstitutional
27. Remedios Blaquera et al v. The Civil Service Commission
Good faith, the Court ruled in Dario vs. Mison is a basic ingredient for the validity of any government reorganization.
It is the golden thread that holds together the fabric of the reorganization. Without it, the cloth would disintegrate.
"Reorganization is a recognized valid ground for separation of civil service employees, subject only to the condition that
it be done in good faith. No less than the Constitution itself in Section 16 of the Transitory Provisions, together with
Sections 33 and 34 of Executive Order No. 81 and Section 9 of Republic Act No. 6656, support this conclusion with the
declaration that all those not so appointed in the implementation of said reorganization shall be deemed separated from
the service with the concomitant recognition of their entitlement to appropriate separation benefits and/or retirement
plans of the reorganized government agency.”
FACTS
To carry out said reorganization, and pursuant to Executive Order No. 165 of May 5, 1987 which abolished the
Commission on Government Reorganization and transferred its remaining functions 1 to the Department of Budget
and Management (DBM for brevity), DENR Secretary Fulgencio S. Factoran, Jr. submitted to the DBM a staffing
pattern consisting of 28,106 positions. The DBM approved only 22,956 positions and the petitioners' positions were
among those trimmed off the new plantilla. As the lean plantilla did not meet the manpower requirements of the DENR,
Secretary Factoran submitted a staffing pattern consisting of 24,614 positions. On July 4, 1988, the DBM released a
revised staffing pattern containing 23,612 positions only which was 1,002 positions less than what the DENR Secretary
requested and which still did not include the positions of the petitioners.
On July 29, 1988, the DENR requested the DBM to restore 839 positions which DBM had disapproved earlier. The
request was approved on September 14, 1988 after long negotiations between the DENR and DBM, subject to the
condition that these positions shall be coterminous with the appointees but not to exceed three (3) years. The
implications of this are: 1. If the appointee desires to retire, resign, transfer to other office or leave his employment for
any reason whatsoever, the position is automatically abolished, even if the three-year period has not lapsed. 2. By the
end of the 3rd year, the employee holding a coterminous position is automatically separated.
Whether the reorganization was made in good faith.
HELD
NO. E.O. No. 192 dated June 10, 1987 "PROVIDING FOR THE REORGANIZATION OF THE DEPARTMENT OF
ENVIRONMENT, ENERGY AND NATURAL RESOURCES, RENAMING IT THE DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, AND FOR OTHER PURPOSES" is a "reorganization following the ratification of this
Constitution." Although impliedly sanctioned under Section 16 of the Transitory Provisions of the 1987 Constitution, it
must nevertheless pass the test of good faith to be valid. Good faith, the Court ruled in Dario vs. Mison is a basic
ingredient for the validity of any government reorganization. It is the golden thread that holds together the fabric of the
reorganization. Without it, the cloth would disintegrate. "Reorganization is a recognized valid ground for separation of
civil service employees, subject only to the condition that it be done in good faith. No less than the Constitution itself
in Section 16 of the Transitory Provisions, together with Sections 33 and 34 of Executive Order No. 81 and Section 9 of
Republic Act No. 6656, support this conclusion with the declaration that all those not so appointed in the
implementation of said reorganization shall be deemed separated from the service with the concomitant recognition of
their entitlement to appropriate separation benefits and/or retirement plans of the reorganized government agency."
(Domingo vs. Development Bank of the Phils., 207 SCRA 766.)
A reorganization in good faith is one designed to trim the fat off the bureaucracy and institute economy and greater
efficiency in its operation. It is not a mere tool of the spoils system to change the face of the bureaucracy and destroy
the livelihood of hordes of career employees in the civil service so that the new-powers-that-be may put their own people
in control of the machinery of government. "Reorganization in this jurisdiction have been regarded as valid provided
they are pursuedin good faith. As a general rule, a reorganization is carried out in 'good faith' if it is for the purpose of
economy or to make bureaucracy more efficient. In that event, no dismissal (in case of dismissal) or separation actually
occurs because the position itself ceases to exist. And in that case, security of tenure would not be a Chinese wall. Be
that as it may, if the 'abolition,' which is nothing else but a separation or removal, is done for political reasons or
purposely to defeat security of tenure, or otherwise not in good faith, no valid 'abolition' takes place and whatever
'abolition' is done, is void ab initio. There is an invalid 'abolition' as where there is merely a change of nomenclature of
positions, or where claims of economy are belied by the existence of ample funds." (Dario vs. Mison, 176 SCRA 84, 92-
93.)
There is no dispute over the power to reorganize — whether traditional, progressive, or whatever adjective is appended
to it. However, the essence of constitutional government is adherence to basic rules. The rule of law requires that no
government official should feel free to do as he pleases using only his avowedly sincere intentions and conscience to
guide him. The fundamental standards of fairness embodied in the bona fide rule cannot be disregarded. More
particularly, the auto-limitations imposed by the President when she proclaimed the Provisional Constitution and
issued executive orders as sole law maker and the standards and restrictions prescribed by the present Constitution
and the Congress established under it, must be obeyed. Absent this compliance, we cannot say that a reorganization is
bona fide." (Mendoza vs. Quisumbing, 186 SCRA 108.) "In fact, the right of the State to reorganize the Government
resulting in the separation of career civil service employees under the 1987 Constitution is beyond dispute, but as
emphasized in the Mison case (G.R. Nos. 81954, 81967 and 82023, August 8, 1989) and in the cases of Bondoc vs. Sec.
of Science and Technology (G.R. No. 83025), Quisumbing vs. Tupas (G.R. No. 87401) and Hamed vs. Civil Service
Commission (G.R. No.89069), all of which having been promulgated on July 19, 1990, said reorganization, ouster, and
appointments of successors must be made in GOOD FAITH." (Siete vs. Santos, 190 SCRA 50, 51-52.)
There appears to be no sufficient justification for the reorganization of the DENR, as revised by the DBM. The fact that
Section 25 of E.O. No. 192 changed that status of all the officers and employees of the DENR from permanent or regular
to mere "hold-overs," flagrantly violating the employees' right to due process, taints the reorganization process. In
Domingo vs. DBP, 207 SCRA 766, the Court emphasized that a reorganization "does not justify a detraction from the
mandatory requirement of notice and hearing" to the affected officials and employees. Section 2 of Republic Act No.
6656 provides that 'no officer or employee in the career service shall be removed except for a valid cause and after due
notice and hearing.' thus, there is no question that while dismissal due to a bona fide reorganization is recognized as
a valid cause, this does not justify a detraction from the mandatory requirement of notice and hearing. . . .
That the reorganization of the DENR was not intended to achieve economy and efficiency, is revealed by the admission
in page 16 of the public respondents' Comment that the new staffing pattern of the department contains "991 positions
more than the total number of permanent positions in the DENR before the reorganization." In fact, DENR Secretary
Fulgencio Factoran (who is presumed to know better than anyone else the needs of his department) had urged the DBM
to restore the positions of the petitioners because they are "vital to the functions, mandates and objectives of the DENR"
(p. 30, Comment). Since the abolition of their positions will not conduce to either "efficiency" or "economy" in the
Service, which are the principal justifications for any government overhaul, then, obviously, the reorganization of the
DENR is not justified. The conversion of the petitioners from permanent to "coterminous" employees is a wholesale
demotion of personnel which is tantamount to removal without cause and without due process." (Floreza vs. Ongpin,
182 SCRA 692, 693.) It is therefore null and void.
28. Cerilles vs Civil Service Commission (G.R. No. 180845, June 5, 2018)
“A reorganization in good faith is one designed to trim the fat off the bureaucracy and institute economy and greater efficiency in
its operation. It is not a mere tool of the spoils system to change the face of the bureaucracy and destroy the livelihood of hordes
of career employees in the civil service so that the new-powers-that-be may put their own people in control of the machinery of
government.”
FACTS
❖ RA No. 8973 entitled "An Act creating the Province of Zamboanga Sibugay from the Province of Zamboanga del Sur and
for other purposes" was passed.
❖ The Internal Revenue Allotment (IRA) of the province of Zamboanga del Sur was reduced by 36%. Because of such
reduction, Gov. Cerilles sought the opinion of CSC on the possibility of reducing the workforce of the provincial
government. Sangguniang Panlalawigan of Zamboanga del Sur passed a Resolution approving the new staffing pattern of
the provincial government consisting only of 727 positions
❖ Private respondents filed their respective letters of appeal respecting their termination with petitioner. However, no
action was taken on the appeals made; hence, private respondents brought the matter to CSCRO IX.
❖ CSCRO IX ruled that the appointments violated RA 6656 for allegedly failing to grant preference in appointment to
employees previously occupying permanent positions in the old plantilla.
❖ CSCRO invalidated a total of 96 appointments made by Gov. Cerilles after the reorganization. CSC and the CA dismissed
the succeeding appeal filed by Gov. Cerilles.
W/N the CSC has RA 6656: SEC. 2. No officer or employee in the career service shall be removed except for a valid cause and
the authority to after due notice and hearing. A valid cause for removal exists when, pursuant to a bonafide reorganization, a
revoke the position has been abolished or rendered redundant or there is a need to merge, divide, or consolidate
appointment made positions in order to meet the exigencies of the service, or other lawful causes allowed by the Civil Service
by Gov Cerilles. Law. The existence of any or some of the following circumstances may be considered as evidence of bad faith
in the removals made as a result of reorganization, giving rise to a claim for reinstatement or reappointment
by an aggrieved party
SEC. 4. Officers and employees holding permanent appointments shall be given preference for appointment
to the new positions in the approved sta@ng pattern comparable to their former positions or in case there are
not enough comparable positions, to positions next lower in rank.
No new employees shall be taken in until all permanent officers and employees have been appointed,
including temporary and casual employees who possess the necessary qualification requirements, among
which is the appropriate civil service eligibility, for permanent appointment to positions in the approved
sta@ng pattern, in case there are still positions to be filled, unless such positions are policy-determining,
primarily confidential or highly technical in nature.
HELD: Yes.
The Court already ruled that in instances of reorganization, there is no encroachment on the discretion of the appointing
authority when the CSC revokes an appointment on the ground that the removal of the employee was done in bad faith. In such
instances, the CSC is not actually directing the appointment of another but simply ordering the reinstatement of the illegally
removed employee: “It is within the power of CSC to order the reinstatement of government employees who have been unlawfully
dismissed. The CSC, as the central personnel agency, has the obligation to implement and safeguard the constitutional provisions
on security of tenure and due process. In the present case, the issuance by the CSC of the questioned resolutions, for the reasons
clearly explained therein, is indubitably in the performance of its constitutional task of protecting and strengthening the civil
service.”
Following the discussion above, the resolution of the Petition simply hinges on whether the reorganization of the Province of
Zamboanga Del Sur was done in good faith. The Court rules in the negative.
In Blaquera v. Civil Service Commission, citing Dario v. Mison, the Court had the occasion to define good faith in the context of
reorganization: “Good faith, we ruled in Dario vs. Mison is a basic ingredient for the validity of any government reorganization. It
is the golden thread that holds together the fabric of the reorganization. Without it, the cloth would disintegrate.
"Reorganization is a recognized valid ground for separation of civil service employees, subject only to the condition that it be done
in good faith. No less than the Constitution itself in Sec. 16 of the Transitory Provisions, together with Sec. 33 and 34 of EO No. 81
and Sec. 9 of RA No. 6656, support this conclusion with the declaration that all those not so appointed in the implementation of
said reorganization shall be deemed separated from the service with the concomitant recognition of their entitlement to
appropriate separation benefits and/or retirement plans of the reorganized government agency."
“A reorganization in good faith is one designed to trim the fat off the bureaucracy and institute economy and greater efficiency in
its operation. It is not a mere tool of the spoils system to change the face of the bureaucracy and destroy the livelihood of hordes
of career employees in the civil service so that the new-powers-that-be may put their own people in control of the machinery of
government.”
Good faith is always presumed. Thus, to successfully impugn the validity of a reorganization — and correspondingly demand for
reinstatement or reappointment — the aggrieved officer or employee has the burden to prove the existence of bad faith.
Applying the foregoing to the facts of this case, the Court finds that Respondents were able to prove bad faith in the
reorganization of the Province of Zamboanga del Sur.
First, the sheer number of appointments found to be violative of RA 6656 is astounding. As initially observed by the CSCRO, no
less than 96 of the appointments made by Gov. Cerilles violated the rule on preference and non-hiring of new employees
embodied in Sec 4 and 5 of the said law. While the relative scale of invalidated appointments does not conclusively rule out good
faith, there is, at the very least, a strong indication that the reorganization was motivated not solely by the interest of economy
and efficiency, but as a systematic means to circumvent the security of tenure of the 96 employees affected.
Second, Respondents were replaced by either new employees or those holding lower positions in the old staffing pattern —
circumstances that may be properly appreciated as evidence of bad faith pursuant to Sec 2 and Sec 4 of RA 6656.
Significantly, Gov. Cerilles plainly admitted that new employees were indeed hired after the reorganization.
Administrative Agencies (Ordinance Powers)
29. David v. Arroyo (295 U.S. 602, 1935)
President Arroyo’s ordinance power is limited to Executive Orders, Administrative Orders, Proclamations, Memorandum
Orders, Memorandum Circulars, and General or Special Orders—she cannot issue decrees similar to those issued by Former
President Marcos under PP 1081.
FACTS
During the 20th EDSA Anniversary, President Arroyo issued PP 1017 declaring a state of national emergency and GO 5 implementing
it. 7 petitions were filed before the Supreme Court assailing the constitutionality of PP 1017 and GO 5. A week later, Arroyo lifted
PP 1017 and declared that the national emergency had ceased to exist. According to respondents, PP 1017 and GO 5 was issued
because of a conspiracy to unseat or assassinate President Arroyo which posed a clear and present danger.
A provision of PP 1017 states “and to enforce obedience to all the laws and to all decrees, orders and regulations
promulgated by me personally or upon my direction.”
OTHER FACTS:
Following the issuance of PP 1017 and GO 5, the Office of the President announced the cancellation of all programs and activities
related to the 20th anniversary celebration of EDSA People Power I and revoked the permits to hold rallies issued earlier by LGUs.
Nevertheless, KMU and NFLU-KMU marched from various parts of Metro Manila towards the EDSA shrine in Mandaluyong.
Several groups of protesters at various sites were violently dispersed by anti-riot police and arrested. The next day, operatives of
PNP-CIDG raided the Daily Tribune offices in Manila and confiscated news stories, documents, pictures, and mock-ups of the
Saturday issue. Police officers were stationed inside and outside the offices of the newspaper, as well as the premises of another
pro-opposition paper, Malaya; and its sister publication, Abante.
Whether or not the provision in PP 1017 which grants President Book III, Chapter 2, Administrative Code of 1987
Arroyo the authority to promulgate decrees is constitutional.
SECTION 2. Executive Orders — Acts of the President providing
for rules of a general or permanent character in implementation
or execution of constitutional or statutory powers shall be promulgated
in executive orders.
SECTION 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.
SECTION 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.
SECTION 5. Memorandum Orders —Acts of the President on

matters of administrative detail or of subordinate or temporary
interest which only concern a particular officer or office of the
Government shall be embodied in memorandum orders.
SECTION 6. Memorandum Circulars —Acts of the President on

matters relating to internal administration, which the President desires
to bring to the attention of all or some of the departments, agencies,
bureaus or offices of the Government, for information or compliance,
shall be embodied in memorandum circulars.
SECTION 7. General or Special Orders —Acts and commands of the

President in his capacity as Commander-in-Chief of the Armed
Forces of the Philippines shall be issued as general or special orders.
HELD
NO. PP 1017 is unconstitutional insofar as it grants President Arroyo the authority to promulgate “decrees.” Legislative power
is peculiarly within the province of the Legislature. To be sure, neither Martial Law nor a state of rebellion nor a state of emergency
can justify President Arroyo’s exercise of legislative power by issuing decrees. The President is granted an Ordinance Power under
Chapter 2, Book III of Executive Order No. 292. She cannot issue Decrees similar to those issued by former President Marcos
under PP 1081. Presidential Decrees are laws which are of the same category and binding force as statutes because they were issued
by the President in the exercise of his legislative power during the period of Martial Law under the 1973 Constitution. Thus,
President Arroyo’s ordinance power is limited to Executive Orders, Administrative Orders, Proclamations,
Memorandum Orders, Memorandum Circulars, and General or Special Orders—she cannot issue decrees similar
to those issued by Former President Marcos under PP 1081.
With respect to “laws,” President Arroyo cannot call the military to enforce or implement certain laws, such as customs laws, laws
governing family and property relations, laws on obligations and contracts and the like—she can only order the military,
under PP 1017, to enforce laws pertinent to its duty to suppress lawless violence.
CONCLUSION:
PP 1017 is constitutional insofar as it constitutes a call by the President for the AFP to prevent or suppress lawless
violence but PP 1017’s extraneous provisions giving the President express or implied power (1) to issue
decrees,(2) to direct the AFP to enforce obedience to all laws even those not related to lawless violence as well as
decrees promulgated by the President, and (3) to impose standards on media or any form of prior restraint on
the press, are ultra vires and unconstitutional.

B. Admin Agencies Conso Case Digests

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B. Admin Agencies Conso Case Digests

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Administrative Agencies (Nature and Definition; Creation, Establishment, and Abolition; Kinds; Advantages)

01. Malaga v. Penachos (G.R. No. 86695, September 3, 1992)

ISSUE/S STATUTES/ARTICLES INVOLVED

ISSUE/S STATUTES/ARTICLES INVOLVED

Agency - any of the various units of the Government, including a

Instrumentality – any agency of the National Government, not

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

(13) Government-owned or controlled corporation

MIAA is NOT a Government-Owned or Controlled Corporation

ISSUE/S STATUTES/ARTICLES INVOLVED

W/N MCIAA is a GOCC. SEC. 2. General Terms Defined.

(10) Instrumentality refers to any agency of the national

(13) Government-owned or controlled corporation refers to any

ISSUE/S STATUTES/ARTICLES INVOLVED

GOCC - any agency organized as a stock/non-stock corporation,

Government Corporate Entities – instrumentalities or

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

(13) Government-owned or controlled corporations

LRTA is a government instrumentality exercising corporate powers. An agency is a government-owned or controlled

The classification of Government Instrumentalities with Corporate Powers(GICP)/Government Corporate Entities is

ISSUE/S STATUTES/ARTICLES INVOLVED

(10) Instrumentality refers to any agency of the national

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

Abolition of an office if done in good faith is valid.

ISSUE/S STATUTES/ARTICLES INVOLVED

Whether or not the abolition of inferior courts as a result of

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

WON petitioners were removed by virtue of a valid

The power to create an office carries with it the power to abolish.

ISSUE/S STATUTES/ARTICLES INVOLVED

W/N Section 38 of RA 9136 abolishing the ERB is

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

Whether or not the PD 1341 which converted PCC into PUP,

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

ISSUE/S STATUTES/ARTICLES INVOLVED

HELD: No. Court qualifiedly rules in favor of petitioner.

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

ISSUE/S STATUTES/ARTICLES INVOLVED

W/N the President through the executive secretary may modify

Chief Executive Power to delegate

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

ISSUE/S STATUTES/ARTICLES INVOLVED

W/N it is within the authority of the President to transfer the

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

ISSUE/S STATUTES/ARTICLES INVOLVED

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER

ISSUE/S STATUTES/ARTICLES INVOLVED

1 Bureau of Physical Education and School Sports (BPESS)

KEY TAKE-AWAY OR DOCTRINE TO REMEMBER