ADVOCATES FOR TRUTH IN LENDING v. BANGKO SENTRAL MONETARY BOARD, GR No.

192986, 2013-01-15
Facts:
A petition for certiorari was filed by the "Advocates for Truth in Lending, Inc." (AFTIL) is a non- profit,
non-stock corporation organized to engage in pro bono concerns and activities relating to money
lending issues.
R.A. No. 265, which created the Central Bank (CB) of the Philippines on June 15, 1948, empowered
the CB-MB to, among others, set the maximum interest rates which banks may charge for all types of
loans and other credit operations, within limits prescribed by the Usury Law.
On March 17, 1980, the Usury Law was amended by Presidential Decree (P.D.) No. 1684, giving the
CB-MB authority to prescribe different maximum rates of interest which may be imposed for a loan or
renewal thereof or the forbearance of any money, goods or credits,... provided that the changes are
effected gradually and announced in advance.
On June 14, 1993, President Fidel V. Ramos signed into law R.A. No. 7653 establishing the Bangko
Sentral ng Pilipinas (BSP) to replace the CB.
Issues:
Whether under R.A. No. 265 and/or P.D. No. 1684, the CB-MB had the statutory or constitutional
authority to prescribe the maximum rates of interest for all kinds of credit transactions and
forbearance of money, goods or credit beyond the limits prescribed in... the Usury Law;... b)
If so, whether the CB-MB exceeded its authority when it issued CB Circular No. 905, which removed
all interest ceilings and thus suspended Act No. 2655 as regards usurious interest rates;... c)
Whether under R.A. No. 7653, the new BSP-MB may continue to enforce CB Circular No. 905.[5]
Ruling:
The petition must fail.
The foregoing rules were further clarified in Sunga-Chan v. Court of Appeals,[56] as follows:
Eastern Shipping Lines, Inc. synthesized the rules on the imposition of interest, if proper, and the
applicable rate, as follows: The 12% per annum rate under CB Circular No. 416 shall apply only to
loans or forbearance of money, goods, or credits, as... well as to judgments involving such loan or
forbearance of money, goods, or credit, while the 6% per annum under Art. 2209 of the Civil Code
applies "when the transaction involves the payment of indemnities in the concept of damage arising
from the breach or a delay in... the performance of obligations in general," with the application of both
rates reckoned "from the time the complaint was tiled until the [adjudged] amount is fully paid." In
either instance, the reckoning period for the commencement of the running of the legal interest shall
be... subject to the condition "that the courts are vested with discretion, depending on the equities of
each case, on the award of interest."[57] (Citations omitted)
WHEREFORE, premises considered, the Petition for certiorari is DISMISSED.
Principles:
Article 1169 of the Civil Code
Those obliged to deliver or to do something incur in delay from the time the obligee judicially or
extrajudicially demands from them the fulfillment of their obligation.
Art. 2209 of the Civil Code
when the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or
forbearance of money, the interest due should be that which may have been stipulated in writing.

1
MARIA CAROLINA P. ARAULLO v. BENIGNO SIMEON C. AQUINO III, GR No. 209287, 2014-07-01
Facts:
For resolution are the consolidated petitions assailing the constitutionality of the Disbursement
Acceleration Program (DAP), National Budget Circular (NBC) No. 541, and related issuances of the
Department of Budget and Management (DBM) implementing the DAP.
At the core of the controversy is Section 29(1) of Article VI of the 1987 Constitution, a provision of the
fundamental law that firmly ordains that "[n]o money shall be paid out of the Treasury except in
pursuance of an appropriation made by law."
Used constitutional powers under Sec. 25(5) as a guise to use money out of the treasury without an
appropriation made by law... indicate that the DAP contravened this provision by allowing the
Executive to allocate public money pooled from programmed and unprogrammed funds of its various
agencies in the guise of the President exercising his... constitutional authority under Section 25(5) of
the 1987 Constitution to transfer funds out of savings to augment the appropriations of offices within
the Executive Branch of the Government.
Sen. Jinggoy Ejercito Estrada... had been allotted an additional P50 Million each as "incentive" for
voting in favor of the impeachment of Chief
Justice Renato C. Corona.
Abad: Releases to Senators Part of Spending Acceleration Program,[1] explaining that the funds
released to the Senators had been part of... the DAP, a program designed by the DBM to ramp up
spending to accelerate economic expansion.
He clarified that the funds had been released to the Senators based on their letters of request for
funding
He explained that the funds under the DAP were usually taken from (1) unreleased appropriations
under
Personnel Services;[2] (2) unprogrammed funds; (3) carry-over appropriations unreleased from the
previous year; and (4) budgets for slow-moving items or projects that had been realigned to support
faster-disbursing projects.
The DBM soon came out to claim in its website[3] that the DAP releases had been sourced from
savings generated by the Government, and from unprogrammed funds; and that the savings had
been derived from (1) the pooling of unreleased appropriations, like... unreleased Personnel
Services[4] appropriations that would lapse at the end of the year, unreleased appropriations of slow-
moving projects and discontinued projects per zero-based budgeting findings;[5] and (2) the
withdrawal of... unobligated allotments also for slow-moving programs and projects that had been
earlier released to the agencies of the National Government.
The DBM listed the following as the legal bases for the DAP's use of savings,[
Why DAP is legal according to DBM
(1) Section 25(5), Article VI of the 1987 Constitution, which granted to the President the authority to
augment an item for his office in the general appropriations... law; (2) Section 49 (Authority to Use
Savings for Certain Purposes) and Section 38 (Suspension of Expenditure Appropriations), Chapter
5, Book VI of Executive Order (EO) No. 292 (Administrative Code of 1987); and (3) the General
Appropriations Acts (GAAs) of
2011, 2012 and 2013, particularly their provisions on the (a) use of savings; (b) meanings of savings
and augmentation; and (c) priority in the use of savings.
Issues:
Procedural Issue:... whether there is a controversy ripe for judicial determination, and the standing of
petitioners.
Substantive Issues:
B. Whether or not the DAP violates Sec. 29, Art. VI of the 1987 Constitution, which provides: "No
money shall be paid out of the Treasury except in pursuance of an appropriation made by law."
Issue pertinent to Sec. 25
C. Whether or not the DAP, NBC No. 541, and all other executive issuances allegedly implementing
the DAP violate Sec. 25(5), Art. VI of the 1987 Constitution insofar as:
2
(a) They treat the unreleased appropriations and unobligated allotments withdrawn from government
agencies as "savings" as the term is used in Sec. 25(5), in relation to the provisions of the GAAs of
2011, 2012 and 2013;
(b) They authorize the disbursement of funds for projects or programs not provided in the GAAs for
the Executive Department; and
(c) They "augment" discretionary lump sum appropriations in the GAAs
D. Whether or not the DAP violates: (1) the Equal Protection Clause, (2) the system of checks and
balances, and (3) the principle of public accountability enshrined in the 1987 Constitution considering
that it authorizes the release of funds upon the request of... legislators.
E. Whether or not factual and legal justification exists to issue a temporary restraining order to
restrain the implementation of the DAP, NBC No. 541, and all other executive issuances allegedly
implementing the DAP.
F. Whether or not the release of unprogrammed funds under the DAP was in accord with the GAAs.
Ruling:
Procedural Issue:... a) The petitions under Rule 65 are... proper remedies
Judicial power includes the duty of the courts of justice to settle actual controversies involving rights
which are legally demandable and enforceable, and to determine whether or not there has been a
grave abuse of discretion amounting to lack or excess of jurisdiction on the... part of any branch or
instrumentality of the Government.
b) Requisites for the exercise of the power... of judicial review were complied with
(1) there must be an actual case or justiciable controversy before the Court; (2) the question before
the Court must be ripe for adjudication; (3) the person challenging the act must be a... proper party;
and (4) the issue of constitutionality must be raised at the earliest opportunity and must be the very
litis mota of the case
Under their respective circumstances, each of the petitioners has established sufficient interest in the
outcome of the controversy as to confer locus standi on each of them.
II.
Substantive Issues

1. Overview of the Budget System

PAP... c. DAP was not an appropriation... measure; hence, no appropriation... law was required to
adopt or to... implement it... that no law was necessary for the adoption and implementation of the
DAP because of its being neither a fund nor an appropriation, but a program or an administrative
system of prioritizing spending; and that the adoption of the DAP was by virtue of the... authority of
the President as the Chief Executive to ensure that laws were faithfully executed.
Main ratio under Sec. 25(5)

3. Unreleased appropriations and withdrawn... unobligated allotments under the DAP... were not
savings, and the use of such... appropriations contravened Section 25(5),... Article VI of the
1987 Constitution.

The management... and utilization of the public wealth inevitably demands a most careful scrutiny of
whether the Executive's implementation of the DAP was consistent with the Constitution, the relevant
GAAs and other existing laws.
a. Although executive discretion... and flexibility are necessary in... the execution of the budget, any...
transfer of appropriated funds... should conform to Section 25(5),... Article VI of the Constitution
The heads of offices, particularly the President, require flexibility in their operations under
performance budgeting to enable them to make whatever adjustments are needed to meet
established work goals under changing conditions.
the power to transfer funds can give the President the flexibility to meet unforeseen events that may
otherwise impede the efficient implementation of the PAPs set by Congress in the GAA.
Congress has traditionally allowed much flexibility to the President in allocating funds pursuant to the
GAAs,[129] particularly when the funds are grouped to form lump sum accounts.

3
The DAP as a strategy to improve the country's economic... position was one policy that the President
decided to carry out in order to fulfill his mandate under the GAAs.
Denying to the Executive flexibility in the expenditure process would be counterproductive
Were Congress to control expenditures by confining administrators to narrow statutory details, it
would perhaps protect its power of... the purse but it would not protect the purse itself. The realities
and complexities of public policy require executive discretion for the sound management of public
funds.
In contrast, by allowing to the heads of offices some power to transfer funds within their respective
offices, the Constitution itself ensures the fiscal autonomy of their offices, and at the same time
maintains the separation of powers among the three main branches of the
Government.
In the case of the President, the power to transfer funds from one item to another within the Executive
has not been the mere offshoot of established usage, but has emanated from law itself.
The 1973 Constitution explicitly and categorically prohibited the transfer of funds from one item to
another, unless Congress enacted a law authorizing the President, the Prime Minister, the Speaker,
the Chief Justice of the Supreme Court, and the heads of the Constitutional
Commissions to transfer funds for the purpose of augmenting any item from savings in another item
in the GAA of their respective offices.
was further constricted by the condition that the funds to be transferred should come from... savings
from another item in the appropriation of the office
PD No. 1177, providing in its Section 44
Section 44. Authority to Approve Fund Transfers. The President shall have the authority to transfer
any fund appropriated for the different departments, bureaus, offices and agencies of the Executive
Department which are included in the General
Appropriations Act, to any program, project, or activity of any department, bureau or office included in
the General Appropriations Act or approved after its enactment.
The President shall, likewise, have the authority to augment any appropriation of the Executive
Department in the General Appropriations Act, from savings in the appropriations of another
department, bureau, office or agency within the Executive Branch, pursuant to the... provisions of
Article VIII, Section 16 (5) of the Constitution.
In Demetria v. Alba, however, the Court struck down the first paragraph of Section 44 for
contravening Section 16(5) of the 1973 Constitution
Paragraph 1 of Section 44 of P.D. No. 1177 unduly over-extends the privilege granted under said
Section 16. It empowers the President to indiscriminately transfer funds from one department,
bureau, office or agency of the Executive Department to any program, project... or activity of any
department, bureau or office included in the General Appropriations Act or approved after its
enactment, without regard as to whether or not the funds to be transferred are actually savings in the
item from which the same are to be taken, or whether or not... the transfer is for the purpose of
augmenting the item to which said transfer is to be made. It does not only completely disregard the
standards set in the fundamental law, thereby amounting to an undue delegation of legislative
powers, but likewise goes beyond the tenor... thereof. Indeed, such constitutional infirmities render
the provision in question null and void
It is significant that Demetria was promulgated 25 days after the ratification by the people of the 1987
Constitution, whose Section 25(5) of Article VI is identical to Section 16(5), Article VIII of the 1973
Constitution,... The foregoing history makes it evident that the Constitutional Commission included
Section 25(5), supra, to keep a tight rein on the exercise of the power to transfer funds appropriated
by Congress by the President and the other high officials of the Government named therein.
The only exception is found in Section 25 (5), Article VI of the Constitution, by which the President,
the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional Commissions are authorized to... transfer
appropriations to augment any item in the GAA for their respective offices from the savings in other
items of their respective appropriations. The plain language of the constitutional restriction leaves no
room for the petitioner's posture, which we should now... dispose of as untenable.
It bears emphasizing that the exception in favor of the high officials named in Section 25(5), Article VI
of the Constitution limiting the authority to transfer savings only to augment another item in the GAA
is strictly but reasonably construed as exclusive.
4
Accordingly, we should interpret Section 25(5), supra, in the context of a limitation on the President's
discretion over the appropriations during the Budget Execution Phase.
b. Requisites for the valid transfer... of appropriated funds under Section
25(5), Article VI of the 1987
Constitution... b.1. First Requisite GAAs of 2011... and 2012 lacked valid provisions to... authorize
transfers of funds under... the DAP; hence, transfers under the
DAP were unconstitutional
Section 25(5), supra, not being a self-executing provision of the Constitution, must have an
implementing law for it to be operative.
the GAAs should expressly authorize the... transfer of funds.
Did the GAAs expressly authorize the transfer of funds?
2011 GAA... hereby... authorized to augment any item in this Act from savings in other items of their
respective appropriations.
2012 GAA... hereby... authorized to augment any item in this Act from savings in other items of their
respective appropriations
Even had a valid law authorizing the transfer of funds pursuant to Section 25(5), supra, existed, there
still remained two other requisites to be met, namely: that the source of funds to be transferred were
savings from appropriations within the respective offices; and... that the transfer must be for the
purpose of augmenting an item of appropriation within the respective offices.
b.2. Second Requisite There were... no savings from which funds could... be sourced for the DAP
The petitioners claim that the funds used in the DAP the unreleased appropriations and withdrawn
unobligated allotments were not actual savings within the context of Section 25(5), supra, and the
relevant provisions of the GAAs. Belgica argues that "savings" should be... understood to refer to the
excess money after the items that needed to be funded have been funded, or those that needed to be
paid have been paid pursuant to the budget.[146] The petitioners posit that there could be savings
only when the PAPs for which the... funds had been appropriated were actually implemented and
completed, or finally discontinued or abandoned. They insist that savings could not be realized with
certainty in the middle of the fiscal year; and that the funds for "slow-moving" PAPs could not be
considered as savings... because such PAPs had not actually been abandoned or discontinued yet.
[147] They stress that NBC No. 541, by allowing the withdrawn funds to be reissued to the "original
program or project from which it was withdrawn," conceded that the PAPs from which the... supposed
savings were taken had not been completed, abandoned or discontinu
We partially find for the petitioners.
The first principle is that Congress wields the power of the purse. Congress decides how the budget
will be spent; what PAPs to fund; and the amounts of money to be spent for each PAP
The... second principle is that the Executive, as the department of the Government tasked to enforce
the laws, is expected to faithfully execute the GAA and to spend the budget in accordance with the
provisions of the GAA
The third principle is that in... making the President's power to augment operative under the GAA,
Congress recognizes the need for flexibility in budget execution. In so doing, Congress diminishes its
own power of the purse, for it delegates a fraction of its power to the Executive.
But Congress does not... thereby allow the Executive to override its authority over the purse as to let
the Executive exceed its delegated authority... fourth principle is that savings should be actual.
"Actual" denotes something that is real or substantial, or something that exists... presently in fact, as
opposed to something that is merely theoretical, possible, potential or hypothetical.[150]
The foregoing principles caution us to construe savings strictly against expanding the scope of the
power to augment.
The three instances listed in the GAAs' aforequoted definition were a sure indication that savings
could be generated only upon the purpose of the appropriation being fulfilled, or upon the need for the
appropriation being no longer existent.
The DBM declares that part of the savings brought under the DAP came from "pooling of unreleased
appropriations such as unreleased Personnel Services appropriations which will lapse at the end of
the year, unreleased appropriations of slow moving projects and discontinued... projects per Zero-
Based Budgeting findings."
5
The declaration of the DBM by itself does not state the clear legal basis for the treatment of
unreleased or unalloted appropriations as savings.
The fact alone that the appropriations are unreleased or unalloted is a mere description of the status
of the items as unalloted or... unreleased. They have not yet ripened into categories of items from
which savings can be generated.
Appropriations remain unreleased, for instance, because of noncompliance with documentary
requirements (like the Special
Budget Request), or simply because of the unavailability of funds. But the appropriations do not
actually reach the agencies to which they were allocated under the GAAs, and have remained with
the DBM technically speaking. Ergo, unreleased appropriations refer to... appropriations with
allotments but without disbursement authority.
For us to consider unreleased appropriations as savings, unless these met the statutory definition of
savings, would seriously undercut the congressional power of the purse, because such appropriations
had not even reached and been used by the agency concerned vis-à-vis the PAPs... for which
Congress had allocated them.
Justice Carpio has validly observed in his Separate Concurring Opinion that MOOE appropriations
are deemed divided into twelve monthly allocations within the fiscal year; hence, savings could be
generated monthly from the excess or unused MOOE appropriations other than the
Mandatory Expenditures and Expenditures for Business-type Activities because of the physical
impossibility to obligate and spend such funds as MOOE for a period that already lapsed. Following
this observation, MOOE for future months are not savings and cannot be... transferred.
The petitioners accuse the respondents of forcing the generation of savings in order to have a larger
fund available for discretionary spending. They aver that the respondents, by withdrawing unobligated
allotments in the middle of the fiscal year, in effect deprived funding for
PAPs with existing appropriations under the GAAs
We agree with the petitioners.
Contrary to the respondents' insistence, the withdrawals were upon the initiative of the DBM itself. T
The petitioners assert that no law had authorized the withdrawal and transfer of unobligated
allotments and the pooling of unreleased appropriations; and that the unbridled withdrawal of
unobligated allotments and the retention of appropriated funds were akin to the impoundment... of
appropriations that could be allowed only in case of "unmanageable national government budget
deficit" under the GAAs,[157] thus violating the provisions of the GAAs of 2011, 2012 and 2013
prohibiting the retention or deduction of allotments.
The assertions of the petitioners are upheld
The Executive could not circumvent this provision by declaring unreleased appropriations and
unobligated allotments as savings prior to the end of the fiscal year.
b.3. Third Requisite No funds from... savings could be transferred under... the DAP to augment
deficient items... not provided in the GAA... an appropriation for any PAP must first be determined to
be deficient before it could be augmented from savings. Note is taken of the fact that the 2013 GAA
already made this quite clear, thus:... lthough the OSG rightly contends that the Executive was
authorized to spend in line with its mandate to faithfully execute the laws (which included the GAAs),
such authority did not translate to unfettered discretion that allowed the President to substitute his
own will for... that of Congress.
He was still required to remain faithful to the provisions of the GAAs, given that his power to spend
pursuant to the GAAs was but a delegation to him from Congress. Verily, the power to spend the
public wealth resided in Congress, not in the
Executive.[174] Moreover, leaving the spending power of the Executive unrestricted would threaten to
undo the principle of separation of powers. [175]... b.4 Third Requisite Cross-border... augmentations
from savings were... prohibited by the Constitution
By providing that the President, the President of the Senate, the Speaker of the House of
Representatives, the Chief Justice of the Supreme Court, and the Heads of the Constitutional
Commissions may be authorized to augment any item in the GAA "for their respective offices,"
Section 25(5), supra, has delineated borders between their offices, such that funds appropriated for
one office are prohibited from crossing over to another office even in the guise of augmentation of a

6
deficient item or items. Thus, we call such transfers of funds... cross-border transfers or cross-border
augmentations.
To be sure, the phrase "respective offices" used in Section 25(5), supra, refers to the entire
Executive, with respect to the President; the Senate, with respect to the Senate President; the House
of Representatives, with respect to the Speaker; the Judiciary, with... respect to the Chief Justice; the
Constitutional Commissions, with respect to their respective Chairpersons.
The respondents justified all the cross-border transfers thusly:

99. The Constitution does not prevent the President from transferring savings of his department to
another department upon the latter's request, provided it is the recipient department that uses
such funds to augment its own appropriation. In such a case, the

President merely gives the other department access to public funds but he cannot dictate how they
shall be applied by that department whose fiscal autonomy is guaranteed by the Constitution.
Regardless of the variant characterizations of the cross-border transfers of funds, the plain text of
Section 25(5), supra, disallowing cross-border transfers was disobeyed. Cross-border transfers,
whether as augmentation, or as aid, were prohibited under Section
25(5), supra.

4. Sourcing the DAP from unprogrammed... funds despite the original revenue targets... not
having been exceeded was invalid

The petitioners point out that a condition for the release of the unprogrammed funds was that the
revenue collections must exceed revenue targets; and that the release of the unprogrammed funds
was illegal because such condition was not met.[191]
The respondents disagree, holding that the release and use of the unprogrammed funds under the
DAP were in accordance with the pertinent provisions of the GAAs. In particular, the DBM avers that
the unprogrammed funds could be availed of when any of the following three instances... occur, to
wit: (1) the revenue collections exceeded the original revenue targets proposed in the BESFs
submitted by the President to Congress; (2) new revenues were collected or realized from sources
not originally considered in the BESFs; or (3) newly-approved loans for... foreign-assisted projects
were secured, or when conditions were triggered for other sources of funds, such as perfected loan
agreements for foreign-assisted projects.[192] This view of the DBM was adopted by all the
respondents in their Consolidated
Comment
We cannot, therefore, subscribe to the respondents' view.

5. Equal protection, checks and balances,... and public accountability challenges

The denial of equal protection of any law should be an issue to be raised only by parties who
supposedly suffer it, and, in these cases, such parties would be the few legislators claimed to have
been discriminated against in the... releases of funds under the DAP. The reason for the requirement
is that only such affected legislators could properly and fully bring to the fore when and how the denial
of equal protection occurred, and explain why there was a denial in their situation. The requirement
was not... met here.
we have already held that the DAP and its implementing issuances were policies and... acts that the
Executive could properly adopt and do in the execution of the GAAs to the extent that they sought to
implement strategies to ramp up or accelerate the economy of the country.

6. Doctrine of operative fact was applicable

The doctrine of operative fact recognizes the existence of the law or executive act prior to the
determination of its unconstitutionality as an operative fact that produced consequences that cannot
always be erased, ignored or disregarded. In short, it nullifies the void law or... executive act but
sustains its effects. It provides an exception to the general rule that a void or unconstitutional law
produces no effect.
In that context, as Justice Brion has clarified, the doctrine of operative fact can apply only to the PAPs
that can no longer be undone, and whose beneficiaries relied in good faith on the validity of the DAP,
but cannot apply to the authors, proponents and implementors of the

7
DAP, unless there are concrete findings of good faith in their favor by the proper tribunals determining
their criminal, civil, administrative and other liabilities.
Dispositive
WHEREFORE, the Court PARTIALLY GRANTS the petitions for certiorari and prohibition; and
DECLARES the following acts and practices under the Disbursement Acceleration Program, National
Budget Circular No. 541 and related executive issuances
UNCONSTITUTIONAL for being in violation of Section 25(5), Article VI of the 1987 Constitution and
the doctrine of separation of powers, namely:
(a) The withdrawal of unobligated allotments from the implementing agencies, and the declaration of
the withdrawn unobligated allotments and unreleased appropriations as savings prior to the end of
the fiscal year and without complying with the statutory definition of savings... contained in the
General Appropriations Acts;
(b) The cross-border transfers of the savings of the Executive to augment the appropriations of other
offices outside the Executive; and
(c) The funding of projects, activities and programs that were not covered by any appropriation in the
General Appropriations Act.
The Court further DECLARES VOID the use of unprogrammed funds despite the absence of a
certification by the National Treasurer that the revenue collections exceeded the revenue targets for
non-compliance with the conditions provided in the relevant General Appropriations
Acts.
Principles:

1. Overview of the Budget System

The Philippine Budget Cycle

(1) Budget Preparation; (2) Budget Legislation; (3) Budget Execution; and (4) Accountability... c.1.
Budget Preparation
The budget preparation phase is commenced through the issuance of a Budget Call by the DBM
The Budget Call is of two kinds, namely: (1) a National Budget Call, which is addressed to all
agencies, including state universities and colleges; and (2) a Corporate Budget Call, which... is
addressed to all government-owned and -controlled corporations (GOCCs) and government financial
institutions (GFIs)... the various departments and agencies submit their respective Agency Budget
Proposals to the DBM.
DBM bureaus thereafter review the Agency Budget Proposals and come up with recommendations
for the Executive Review Board, comprised by the DBM Secretary and the DBM's senior officials. The
discussions of the Executive Review
Board cover the prioritization of programs and their corresponding support vis-à-vis the priority
agenda of the National Government, and their implementation.
The DBM next consolidates the recommended agency budgets into the National Expenditure
Program (NEP) and a Budget of Expenditures and Sources of Financing (BESF).
NEP provides the details of spending for each department and agency by program, activity... or
project (PAP), and is submitted in the form of a proposed GAA
Once the NEP and the BESF are approved by the President and the Cabinet, the DBM prepares the
budget documents for... submission to Congress.
The budget documents consist of: (1) the President's Budget Message, through which the President
explains the policy framework and budget priorities; (2) the BESF, mandated by Section 22, Article VII
of the Constitution,[68] which contains the macroeconomic assumptions, public sector context,
breakdown of the expenditures and funding sources for the fiscal year and the two previous years;
and (3) the NEP.
Public or government expenditures are generally classified into two categories,... (1) capital
expenditures or outlays; and (2) current operating expenditures.
Capital expenditures are the expenses whose usefulness lasts for more than one year,... and which
add to the assets of the Government,... Current operating expenditures are the purchases of goods
and services in current... consumption the benefit of which does not extend beyond the fiscal yea
8
The two components of current expenditures are those for personal services (PS), and those for
maintenance and other operating expense
Public expenditures
(1) economic development expenditures (i.e., expenditures on agriculture and natural resources,
transportation and communications, commerce and industry, and other... economic development
efforts);[71] (2) social services or social development expenditures (i.e., government outlay on
education, public health and medicare, labor and welfare and others);[72] (3) general government
or... general public services expenditures (i.e., expenditures for the general government, legislative
services, the administration of justice, and for pensions and gratuities); [73] (4) national defense
expenditures (i.e., sub-divided... into national security expenditures and expenditures for the
maintenance of peace and order);[74] and (5) public debt.
Public expenditures may further be classified according to the nature of funds, i.e., general fund,
special fund or bond fund... public revenues complement public expenditures and cover all income or
receipts of the government treasury used to support government expenditures
In the Philippines, public revenues are generally derived from the following sources, to wit: (1) tax
revenues (i.e., compulsory contributions to finance government activities);[80] (2) capital revenues
(i.e., proceeds... from sales of fixed capital assets or scrap thereof and public domain, and gains on
such sales like sale of public lands, buildings and other structures, equipment, and other properties
recorded as fixed assets);[81] (3) grants (i.e.,... voluntary contributions and aids given to the
Government for its operation on specific purposes in the form of money and/or materials, and do not
require any monetary commitment on the part of the recipient);[82] (4) extra-ordinary income
(i.e., repayment of loans and advances made by government corporations and local governments and
the receipts and shares in income of the Banko Sentral ng Pilipinas, and other receipts);[83] and (5)
public borrowings (i.e., proceeds of... repayable obligations generally with interest from domestic and
foreign creditors of the Government in general, including the National Government and its political
subdivisions).[84]... c.2. Budget Legislation
The Budget Legislation Phase covers the period commencing from the time Congress receives the
President's Budget, which is inclusive of the NEP and the BESF, up to the President's approval of the
GAA
Budget
Authorization Phase, and involves the significant participation of the Legislative through its
deliberations.
Initially, the President's Budget is assigned to the House of Representatives' Appropriations
Committee on First Reading
Appropriations Committee and its various Sub-Committees schedule and conduct budget hearings to
examine the PAPs of the... departments and agencies.
House of Representatives drafts the General Appropriations Bill (GA
The GAB is sponsored, presented and defended by the House of Representatives' Appropriations
Committee and Sub-Committees in plenary session. As with other laws, the GAB is approved on
Third Reading before the House of Representatives' version is transmitted... to the Senate
The Senate's Finance Committee and its
Sub-Committees may submit the proposed amendments to the GAB to the plenary of the Senate only
after the House of Representatives has formally transmitted its version to the Senate. The Senate
version of the GAB is likewise approved on Third Readi
The House of Representatives and the Senate then constitute a panel each to sit in the Bicameral
Conference Committee for the purpose of discussing and harmonizing the conflicting provisions of
their versions of the GAB. The "harmonized" version of the GAB is next... presented to the President
for approv... c.3. Budget Execution
The Budget Execution Phase is primarily the function of the DBM, which is tasked to perform the
following procedures, namely: (1) to issue the programs and guidelines for the... release of funds; (2)
to prepare an Allotment and Cash Release Program; (3) to release allotments; and (4) to issue
disbursement authorities.
Thereafter, the DBM prepares an Allotment Release Program (ARP) and a Cash Release Program
(CRP). The ARP sets a limit for allotments issued in general and to a specific agency. The CRP fixes
the monthly, quarterly and annual disbursement... levels.

9
Actual disbursement or spending of government funds terminates the Budget Execution Phase and is
usually accomplished through the Modified Disbursement Scheme under wehich disbursements
chargeable against the National Treasury are coursed through the government... servicing banks.
c.4. Accountability
An agency's accountability may be examined and evaluated through (1) performance targets and
outcomes; (2) budget accountability reports; (3) review of agency performance; and (4) audit
conducted by the Commission on Audit (COA).

2. Nature of the DAP as a fiscal plan... a. DAP was a program designed to... promote economic
growth

Administration's "blueprint for public policy" and reflects the Government's goals and... strategies
The Administration would thereby accelerate government spending by: (1) streamlining the
implementation process through the clustering of infrastructure projects... of the Department of Public
Works and Highways (DPWH) and the Department of Education (DepEd), and (2) frontloading PPP-
related projects[107] due for implementation in the following year.[108]
The DAP was a government policy or strategy designed to stimulate the economy through
accelerated spending.
In the context of the DAP's adoption and implementation being a function pertaining to the Executive
as the main actor during the Budget Execution Stage under its... constitutional mandate to faithfully
execute the laws, including the GAAs, Congress did not need to legislate to adopt or to implement the
DAP.
Congress could appropriate but would have nothing more to do during the Budget Execution Stage.
Indeed, appropriation was the... act by which Congress "designates a particular fund, or sets apart a
specified portion of the public revenue or of the money in the public treasury, to be applied to some
general object of governmental expenditure, or to some individual purchase or expense."
'"In a strict sense, appropriation has been defined 'as nothing more than the legislative authorization
prescribed by the Constitution that money may be paid out of the Treasury,' while... appropriation
made by law refers to 'the act of the legislature setting apart or assigning to a particular use a certain
sum to be used in the payment of debt or dues from the State to its creditors.'"
On the other hand, the President, in keeping with his duty to faithfully execute the laws, had sufficient
discretion during the execution of the budget to adapt the budget to changes in the country's
economic situation.
He could adopt a plan like the
DAP for the purpose. He could pool the savings and identify the PAPs to be funded under the DAP.
In such actions, the Executive did not usurp the power vested in Congress under Section 29(1),
Article VI of the Constitution.
It is significant that Demetria was promulgated 25 days after the ratification by the people of the 1987
Constitution, whose Section 25(5) of Article VI is identical to Section 16(5), Article VIII of the 1973
Constitution, to wit:
Section 25. x x x... x x x x

5. No law shall be passed authorizing any transfer of appropriations; however, the President, the
President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional Commissions may, by law, be authorized... to
augment any item in the general appropriations law for their respective offices from savings in
other items of their respective appropriations.

Requisites for the valid transfer... of appropriated funds under Section

25(5), Article VI of the 1987
Constitution
The transfer of appropriated funds, to be valid under Section 25(5), supra, must be made upon a
concurrence of the following requisites, namely:
(1) There is a law authorizing the President, the President of the Senate, the Speaker of the House of
Representatives, the Chief Justice of the Supreme Court, and the heads of the Constitutional
Commissions to transfer funds within their respective offices;
10
(2) The funds to be transferred are savings generated from the appropriations for their respective
offices; and
(3) The purpose of the transfer is to augment an item in the general appropriations law for their
respective offices.
Appropriations have been considered "released" if there has already been an allotment or
authorization to incur obligations and disbursement authority.
According to Philippine Constitution Association v. Enriquez:[159] "Impoundment refers to a refusal
by the President, for whatever reason, to spend funds made available by Congress. It is the failure to
spend or obligate budget authority of any... type." Impoundment under the GAA is understood to
mean the retention or deduction of appropriations. The 2011 GAA authorized impoundment only in
case of unmanageable National Government budget deficit, to wit:
Augmentation implies the existence in this Act of a program, activity, or project with an appropriation,
which upon implementation, or subsequent evaluation of needed resources, is determined to be
deficient. In no case shall a non-existent program,... activity, or project, be funded by augmentation
from savings or by the use of appropriations otherwise authorized in this Act.
It is the President who proposes the budget but it is Congress that has the final say on matters of
appropriations.[180] For this purpose, appropriation involves two governing principles, namely: (1) "a
Principle of the Public Fisc, asserting that all... monies received from whatever source by any part of
the government are public funds;" and (2) "a Principle of Appropriations Control, prohibiting
expenditure of any public money without legislative authorization.

11
GRECO ANTONIOUS BEDA B. BELGICA v. EXECUTIVE SECRETARY PAQUITO N. OCHOA, GR
No. 208566, 2013-11-19

Facts:
"Pork Barrel" is... the actions of American legislators in trying to direct federal budgets in favor of their
districts.
"Pork Barrel"... refers to an appropriation of government spending meant for localized projects and
secured solely or primarily to bring money to a representative's district.
Issues:
Procedural Issues.
Ruling:
[t]here must be a contrariety of legal rights that can be interpreted and enforced on the basis of
existing law and... jurisprudence."[122] Related to the requirement of an actual case or controversy is
the requirement of "ripeness," meaning that the questions raised for constitutional scrutiny are
already ripe for adjudication.
The requirement of contrariety of legal rights is clearly satisfied by the antagonistic positions of the
parties on the constitutionality of the "Pork Barrel System." Also, the questions in these consolidated
cases are ripe for adjudication since the challenged funds and the... provisions allowing for their
utilization such as the 2013 GAA for the PDAF, PD 910 for the Malampaya Funds and PD 1869, as
amended by PD 1993, for the Presidential Social Fund are currently existing and operational; hence,
there exists an immediate or threatened injury to... petitioners as a result of the unconstitutional use
of these public funds.
The President has no power to legally abolish PDAF.
The focal point of res judicata is the judgment. The principle states that a judgment on the merits in a
previous case rendered by a court of competent jurisdiction would bind a subsequent case if,
between the first and second actions, there exists... an identity of parties, of subject matter, and of
causes of action.[151] This required identity is not, however, attendant hereto since Philconsa and
LAMP, respectively involved constitutional challenges against the 1994 CDF
Article and 2004 PDAF Article, whereas the cases at bar call for a broader constitutional scrutiny of
the entire "Pork Barrel System." Also, the ruling in LAMP is essentially a dismissal based on a
procedural technicality and, thus, hardly a judgment on... the merits in that petitioners therein failed to
present any "convincing proof x x x showing that, indeed, there were direct releases of funds to the
Members of Congress, who actually spend them according to their sole discretion" or "pertinent
evidentiary support [to... demonstrate the] illegal misuse of PDAF in the form of kickbacks [and] has
become a common exercise of unscrupulous Members of Congress." As such, the Court upheld, in
view of the presumption of constitutionality accorded to every law, the 2004 PDAF Article, and saw
"no... need to review or reverse the standing pronouncements in the said case." Hence, for the
foregoing reasons, the res judicata principle, insofar as the Philconsa and LAMP cases are
concerned, cannot apply.
the Pork Barrel System as the collective body of rules and practices that govern the manner by which
lump-sum, discretionary funds, primarily intended for... local projects, are utilized through the
respective participations of the Legislative and Executive branches of government, including its
members.
the Congressional Pork Barrel which is herein defined as a kind of lump-sum, discretionary fund
wherein legislators, either individually or collectively organized into committees, are able to effectively
control certain aspects of the fund's utilization... through various post-enactment measures and/or
practices.
the Presidential Pork Barrel which is herein defined as a kind of lump-sum, discretionary fund which
allows the President to determine the manner of its utilization
Essentially, under the 2013 PDAF Article, individual legislators are given... a personal lump-sum fund
from which they are able to dictate (a) how much from such fund would go to (b) a specific project or
beneficiary that they themselves also determine. As these two (2) acts comprise the exercise of the
power of... appropriation as described in Bengzon, and given that the 2013 PDAF Article authorizes
individual legislators to perform the same, undoubtedly, said legislators have been conferred the
power to legislate which the Constitution does not, however, allow. Thus, keeping with the... principle
of non-delegability of legislative power, the Court hereby declares the 2013 PDAF Article, as well as
12
all other forms of Congressional Pork Barrel which contain the similar legislative identification feature
as herein discussed, as unconstitutional.
Checks and Balances.
The Constitution has also provided for an elaborate system of checks and balances to secure...
coordination in the workings of the various departments of the government.
In contrast, what beckons constitutional infirmity are appropriations which merely provide for a
singular lump-sum amount to be tapped as a source of funding for multiple purposes. Since such
appropriation type necessitates the further determination of... both the actual amount to be expended
and the actual purpose of the appropriation which must still be chosen from the multiple purposes
stated in the law, it cannot be said that the appropriation law already indicates a "specific...
appropriation of money" and hence, without a proper line-item which the President may veto. As a
practical result, the President would then be faced with the predicament of either vetoing the entire
appropriation if he finds some of its purposes wasteful or undesirable, or... approving the entire
appropriation so as not to hinder some of its legitimate purposes. Finally, it may not be amiss to state
that such arrangement also raises non-delegability issues considering that the implementing authority
would still have to determine, again, both the... actual amount to be expended and the actual purpose
of the appropriation. Since the foregoing determinations constitute the integral aspects of the power
to appropriate, the implementing authority would, in effect, be exercising legislative prerogatives in
violation of the... principle of non-delegability.
The Court agrees with petitioners.
. This kind of lump-sum/post-enactment legislative identification budgeting system fosters the creation
of a "budget within a budget" which subverts the prescribed procedure of presentment... and
consequently impairs the President's power of item veto. As petitioners aptly point out, the above-
described system forces the President to decide between (a) accepting the entire P24.79 Billion
PDAF allocation without knowing the specific projects of the... legislators, which may or may not be
consistent with his national agenda and (b) rejecting the whole PDAF to the detriment of all other
legislators with legitimate projects.
The Court also observes that this concept of legislator control underlying the CDF and PDAF conflicts
with the functions of the various Local Development Councils (LDCs) which are already legally
mandated to "assist the corresponding sanggunian in setting the direction of... economic and social
development, and coordinating development efforts within its territorial jurisdiction."[234] Considering
that LDCs are instrumentalities whose functions are essentially geared towards managing local
affairs,[235]... their programs, policies and resolutions should not be overridden nor duplicated by
individual legislators, who are national officers that have no law-making authority except only when
acting as a body. The undermining effect on local autonomy caused by the post-enactment...
authority conferred to the latter was succinctly put by petitioners in the following wise:[236]
With PDAF, a Congressman can simply bypass the local development council and initiate projects on
his own, and even take sole credit for its execution. Indeed, this type of personality-driven project
identification has not only contributed little to the overall... development of the district, but has even
contributed to ?further weakening infrastructure planning and coordination efforts of the government."
Thus, insofar as individual legislators are authorized to intervene in purely local matters and thereby
subvert genuine local autonomy, the 2013 PDAF Article as well as all other similar forms of
Congressional Pork Barrel is deemed unconstitutional.
As such, the Court observes that the real appropriation made... under the 2013 PDAF Article is not
the P24.79 Billion allocated for the entire PDAF, but rather the post-enactment determinations made
by the individual legislators which are, to repeat, occurrences outside of the law. Irrefragably, the
2013 PDAF Article does not constitute an
"appropriation made by law" since it, in its truest sense, only authorizes individual legislators to
appropriate in violation of the non-delegability principle as afore-discussed.
Thus, while Section 8 of PD 910 may have passed the... completeness test since the policy of energy
development is clearly deducible from its text, the phrase "and for such other purposes as may be
hereafter directed by the President" under the same provision of law should nonetheless be stricken
down as unconstitutional as it lies... independently unfettered by any sufficient standard of the
delegating law. This notwithstanding, it must be underscored that the rest of Section 8, insofar as it
allows for the use of the Malampaya Funds "to finance energy resource development and exploitation
programs and... projects of the government," remains legally effective and subsisting. Truth be told,
the declared unconstitutionality of the aforementioned phrase is but an assurance that the
Malampaya Funds would be used as it should be used only in accordance with the avowed purpose
and... intention of PD 910.
13
the unconstitutionality... must only be treated as prospective in effect in view of the... operative fact
doctrine.
the operative fact doctrine exhorts the recognition that until the judiciary, in an appropriate case,
declares the invalidity of a certain legislative or executive act, such act is presumed constitutional and
thus, entitled to obedience and respect and should be... properly enforced and complied with.
In the final analysis, the Court must strike down the Pork Barrel System as unconstitutional in view of
the inherent defects in the rules within which it operates.
To... recount, insofar as it has allowed legislators to wield, in varying gradations, non-oversight, post-
enactment authority in vital areas of budget execution, the system has violated the principle of
separation of powers; insofar as it has conferred unto legislators the... power of appropriation by
giving them personal, discretionary funds from which they are able to fund specific projects which
they themselves determine, it has similarly violated the principle of non- delegability of legislative
power; insofar as it has created a system of... budgeting wherein items are not textualized into the
appropriations bill, it has flouted the prescribed procedure of presentment and, in the process, denied
the President the power to veto items; insofar as it has diluted the effectiveness of congressional...
oversight by giving legislators a stake in the affairs of budget execution, an aspect of governance
which they may be called to monitor and scrutinize, the system has equally impaired public
accountability; insofar as it has authorized legislators, who are national... officers, to intervene in
affairs of purely local nature, despite the existence of capable local institutions, it has likewise
subverted genuine local autonomy; and again, insofar as it has conferred to the President the power
to appropriate funds intended by law for... energy-related purposes only to other purposes he may
deem fit as well as other public funds under the broad classification of "priority infrastructure
development projects," it has once more transgressed the principle of non-delegability.
Finally, the Court hereby DIRECTS all prosecutorial organs of the government to, within the bounds
of reasonable dispatch, investigate and accordingly prosecute all government officials and/or private
individuals for possible criminal offenses related to the irregular,... improper and/or unlawful
disbursement/utilization of all funds under the Pork Barrel System.
This Decision is immediately executory but prospective in effect.
Principles:
The Court will decide cases, otherwise moot, if: first, there is a... grave violation of the Constitution;
second, the exceptional character of the situation and the paramount public interest is involved; third,
when the constitutional issue raised requires formulation of controlling principles to guide the bench,
the bar, and the... public; and fourth, the case is capable of repetition yet evading review.
The applicability of the first exception is clear from the fundamental posture of petitioners they
essentially allege grave violations of the Constitution with respect to, inter alia, the principles of
separation of powers, non-delegability of legislative power,... checks and balances, accountability and
local autonomy.

14
FRANCISCO I. CHAVEZ v. JUDICIAL AND BAR COUNCIL, GR No. 202242, 2012-07-17
Facts:
Does the first paragraph of Section 8, Article VIII of the 1987 Constitution allow more than one (1)
member of Congress to sit in the JBC? Is the practice of having two (2) representatives from each
house of Congress with one (1) vote each sanctioned by the Constitution?
In 1994, the composition of the JBC was substantially altered. Instead of having only seven (7)
members, an eighth (8th) member was added to the JBC as two (2) representatives from Congress
began sitting in the JBC - one from the House of Representatives... and one from the Senate, with
each having one-half (1/2) of a vote.[7] Then, curiously, the JBC En Banc, in separate meetings held
in 2000 and 2001, decided to allow the representatives from the Senate and the House of
Representatives one full vote... each.[8] At present, Senator Francis Joseph G. Escudero and
Congressman Niel C. Tupas, Jr. (respondents) simultaneously sit in the JBC as representatives of the
legislature.
petitioner has questioned in this petition,[9] setting forth the following
GROUNDS FOR ALLOWANCE OF THE PETITION
I
Article VIII, Section 8, Paragraph 1 is clear, definite and needs no interpretation in that the JBC shall
have only one representative from Congress.
II
The framers of the Constitution clearly envisioned, contemplated and decided on a JBC composed of
only seven (7) members.
III
Had the framers of the Constitution intended that the JBC composed of the one member from the
Senate and one member from the House of Representatives, they could have easily said so as they
did in the other provisions of the Constitution.
IV
The composition of the JBC providing for three ex- fficio members is purposely designed for a
balanced representation of each of the three branches of the government.
V
One of the two (2) members of the JBC from Congress has no right (not even ½ right) to sit in the
said constitutional body and perform the duties and functions of a member thereof.
VI
The JBC cannot conduct valid proceedings as its composition is illegal and unconstitutional
Through the Office of the Solicitor General (OSG), respondents defended their position as members
of the JBC in their Comment[13] filed on July 12, 2012. According to them, the crux of the controversy
is the phrase "a representative of
Congress."... the House of Representatives, without the Senate and vice-versa, is not Congress.[16]
Bicameralism, as the system of choice by the Framers, requires that both houses exercise their
respective powers in the performance of its mandated duty which is to legislate.
when Section 8(1), Article VIII of the Constitution speaks of "a representative... from Congress," it
should mean one representative each from both Houses which comprise the entire Congress.
Tracing the subject provision's history, the respondents claim that when the JBC was established, the
Framers originally envisioned a unicameral legislative body, thereby allocating "a representative of
the National Assembly" to the JBC.
The phrase, however, was not modified to... aptly jive with the change to bicameralism... the Court...
views the petition as essentially an action for declaratory relief under Rule 63 of the 1997 Rules of
Civil Procedure... the petition is also for prohibition under Rule 65 seeking to enjoin
Congress from sending two (2) representatives with one (1) full vote each to the JBC.
Issues:
(1) Whether or not the conditions sine qua non for the exercise of the power of judicial review have
been met in this case; and
15
(2) Whether or not the current practice of the JBC to perform its functions with eight (8) members, two
(2) of whom are members of Congress, runs counter to the letter and spirit of the 1987 Constitution.
Ruling:
the determinants established in jurisprudence are attendant in this case: (1) the character of the funds
or other assets involved in the... case; (2) the presence of a clear case of disregard of a constitutional
or statutory prohibition by the public respondent agency or instrumentality of the government; and (3)
the lack of any other party with a more direct and specific interest in the questions being... raised.
The allegations are substantiated by facts and, therefore, deserve an evaluation from the Court. The
Court... need not elaborate on the legal and societal ramifications of the issues raised. It cannot be
gainsaid that the JBC is a constitutional innovation crucial in the selection of the magistrates in our
judicial system.
From a simple reading of the above-quoted provision, it can readily be discerned that the provision is
clear and unambiguous. The first paragraph calls for the creation of a JBC and places the same
under the supervision of the Court.
the use of the singular letter "a" preceding "representative of Congress" is unequivocal and leaves no
room for any other construction.
It is indicative of what the members of the Constitutional Commission had in mind, that is, Congress
may... designate only one (1) representative to the JBC. Had it been the intention that more than one
(1) representative from the legislature would sit in the JBC, the Framers could have, in no uncertain
terms, so provided.
erba legis non est recedendum from... the words of a statute there should be no departure.
even if the Court should proceed to look into the minds of the members of the Constitutional
Commission, it is undeniable from the records thereof that it was intended that the JBC be composed
of seven (7) members only.
the Court takes the initiative to clarify that it is not in a position to determine as to who should remain
as the sole representative of Congress in the JBC. This is a matter beyond the province of the Court
and is best left to the determination of
Congress.
the remedy lies in the amendment of this constitutional provision. The courts merely give effect to the
lawgiver's intent.
WHEREFORE, the petition is GRANTED. The current numerical composition of the Judicial and Bar
Council IS declared UNCONSTITUTIONAL. The Judicial and Bar Council is hereby enjoined to
reconstitute itself so that only one ( 1) member of Congress will sit as a... representative in its
proceedings, in accordance with Section 8( 1 ), Article VIII of the 1987 Constitution.
Principles:
The Court considers this a constitutional issue that must be passed upon, lest a constitutional
process be plagued by misgivings, doubts and worse, mistrust. Hence, a citizen has a right to bring
this question to the Court, clothed with legal... standing and at the same time, armed with issues of
transcendental importance to society. The claim that the composition of the JBC is illegal and
unconstitutional is an object of concern, not just for a nominee to a judicial post, but for all citizens
who have the right to seek... judicial intervention for rectification of legal blunders.

16
PROF. RANDOLF S. DAVID v. GLORIA MACAPAGAL-ARROYO, GR NO. 171396, 2006-05-03
Facts:
These seven (7) consolidated petitions for certiorari and prohibition allege that in issuing Presidential
Proclamation No. 1017 (PP 1017) and General Order No. 5 (G.O. No. 5), President Gloria
Macapagal-Arroyo committed grave abuse of discretion.
On March 3, 2006, exactly one week after the declaration of a state of national emergency and after
all these petitions had been filed, the President lifted PP 1017. She issued Proclamation No. 1021
which reads:
WHEREAS, pursuant to Section 18, Article VII and Section 17, Article XII of the Constitution,
Proclamation No. 1017 dated February 24, 2006, was issued declaring a state of national emergency;
WHEREAS, by virtue of General Order No.5 and No.6 dated February 24, 2006, which were issued
on the basis of Proclamation No. 1017, the Armed Forces of the Philippines (AFP) and the Philippine
National Police (PNP), were directed to maintain law and order throughout... the Philippines, prevent
and suppress all form of lawless violence as well as any act of rebellion and to undertake such action
as may be necessary;
WHEREAS, the AFP and PNP have effectively prevented, suppressed and quelled the acts lawless
violence and rebellion;
During the oral arguments held on March 7, 2006, the Solicitor General specified the facts leading to
the issuance of PP 1017 and G.O. No. 5. Significantly, there was no refutation from petitioners'
counsels.
The Solicitor General argued that the intent of the Constitution is to give full discretionary powers to
the President in determining the necessity of calling out the armed forces. He emphasized that none
of the petitioners has shown that PP 1017 was without factual... bases.
While he explained that it is not respondents' task to state the facts behind the questioned
Proclamation, however, they are presenting the same, narrated hereunder, for the elucidation of the
issues.
On March 3, 2006, President Arroyo issued PP 1021 declaring that the state of national emergency
has ceased to exist.
In the interim, these seven (7) petitions challenging the constitutionality of PP 1017 and G.O. No. 5
were filed with this Court against the above-named respondents. Three (3) of these petitions
impleaded President Arroyo as respondent.
In G.R. No. 171396, petitioners Randolf S. David, et al. assailed PP 1017 on the grounds that (1) it
encroaches on the emergency powers of Congress; (2) it is a subterfuge to avoid the constitutional
requirements for the... imposition of martial law; and (3) it violates the constitutional guarantees of
freedom of the press, of speech and of assembly.
In G.R. No. 171409, petitioners Ninez Cacho-Olivares and Tribune Publishing Co., Inc. challenged
the CIDG's act of raiding the Daily Tribune offices as a clear case of "censorship" or "prior restraint."
They also claimed that the term
"emergency" refers only to tsunami, typhoon, hurricane and similar occurrences, hence, there is
"absolutely no emergency" that warrants the issuance of PP 1017.
In G.R. No. 171485, petitioners herein are Representative Francis Joseph G. Escudero, and twenty
one (21) other members of the House of Representatives, including Representatives Satur Ocampo,
Rafael Mariano, Teodoro Casiño, Liza Maza, and Josel Virador. They... asserted that PP 1017 and
G.O. No. 5 constitute "usurpation of legislative powers"; "violation of freedom of expression" and "a
declaration of martial law." They alleged that President Arroyo "gravely abused her discretion in
calling out the armed... forces without clear and verifiable factual basis of the possibility of lawless
violence and a showing that there is necessity to do so."
In G.R. No. 171483, petitioners KMU, NAFLU-KMU, and their members averred that PP 1017 and
G.O. No. 5 are unconstitutional because (1) they arrogate unto President Arroyo the power to enact
laws and decrees; (2) their issuance was without... factual basis; and (3) they violate freedom of
expression and the right of the people to peaceably assemble to redress their grievances.
17
In G.R. No. 171400, petitioner Alternative Law Groups, Inc. (ALGI) alleged that PP 1017 and G.O.
No. 5 are unconstitutional because they violate (a) Section 4[15] of Article II, (b) Sections 1,[16] 2,[17]
and 4[18] of Article III, (c) Section 23[19] of Article VI, and (d) Section 17[20] of Article XII of the
Constitution.
In G.R. No. 171489, petitioners Jose Anselmo I. Cadiz et al., alleged that PP 1017 is an "arbitrary and
unlawful exercise by the President of her Martial Law powers." And assuming that PP 1017 is not
really a declaration of Martial Law,... petitioners argued that "it amounts to an exercise by the
President of emergency powers without congressional approval." In addition, petitioners asserted that
PP 1017 "goes beyond the nature and function of a proclamation as defined under the Revised
Administrative Code."
And lastly, in G.R. No. 171424, petitioner Loren B. Legarda maintained that PP 1017 and G.O. No. 5
are "unconstitutional for being violative of the freedom of expression, including its cognate rights such
as freedom of the press and the right to access to... information on matters of public concern, all
guaranteed under Article III, Section 4 of the 1987 Constitution." In this regard, she stated that these
issuances prevented her from fully prosecuting her election protest pending before the Presidential
Electoral
Tribunal.
Issues:
1. Whether the issuance of PP 1021 renders the petitions moot and academic.
2. Whether petitioners in 171485 (Escudero et al.), G.R. Nos. 171400 (ALGI), 171483 (KMU et
al.), 171489 (Cadiz et al.), and 171424 (Legarda) have legal... standing.
B. SUBSTANTIVE:
1. Whether the Supreme Court can review the factual bases of PP 1017.
2. Whether PP 1017 and G.O. No. 5 are unconstitutional.
a. Facial Challenge... b. Constitutional Basis... c. As Applied Challenge
Ruling:
The Court holds that President Arroyo's issuance of PP 1021 did not render the present petitions
moot and academic. During the eight (8) days that PP 1017 was operative, the police officers,
according to petitioners, committed illegal acts in implementing it. Are PP 1017... and G.O. No. 5
constitutional or valid? Do they justify these alleged illegal acts? These are the vital issues that must
be resolved in the present petitions. It must be stressed that "an unconstitutional act is not a law, it
confers no rights, it imposes no duties,... it affords no protection; it is in legal contemplation,
inoperative."[30]... here is no question that the issues being raised affect the... public's interest,
involving as they do the people's basic rights to freedom of expression, of assembly and of the press.
Moreover, the Court has the duty to formulate guiding and controlling constitutional precepts,
doctrines or rules. It has the symbolic function of educating... the bench and the bar, and in the
present petitions, the military and the police, on the extent of the protection given by constitutional
guarantees.[35] And lastly, respondents' contested actions are capable of repetition. Certainly, the...
petitions are subject to judicial review.
g. Legal Standing
However, being a mere procedural technicality, the requirement of locus standi may be waived by the
Court in the exercise of its discretion. This was done in the 1949 Emergency Powers Cases, Araneta
v. Dinglasan,[49]... where the "transcendental importance" of the cases prompted the Court to act
liberally. S
The locus standi of petitioners in G.R. No. 171396, particularly David and Llamas, is beyond doubt.
The same holds true with petitioners in G.R. No. 171409, Cacho-Olivares and Tribune Publishing Co.
Inc. They alleged "direct... injury" resulting from "illegal arrest" and "unlawful search" committed by
police operatives pursuant to PP 1017. Rightly so, the Solicitor General does not question their legal
standing.
n G.R. No. 171485, the opposition Congressmen alleged there was usurpation of legislative powers.
They also raised the issue of whether or not the concurrence of Congress is necessary whenever the
alarming powers incident to Martial Law are used. Moreover, it is in... the interest of justice that those
18
affected by PP 1017 can be represented by their Congressmen in bringing to the attention of the
Court the alleged violations of their basic rig
In G.R. No. 171400, (ALGI), this Court applied the liberality rule in Philconsa v. Enriquez,[60]
Kapatiran Ng Mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. v. Tan,[61] Association of
Small Landowners in the Philippines, Inc. v. Secretary of Agrarian Reform,[62] Basco v. Philippine
Amusement and Gaming Corporation,[63] and Tañada v. Tuvera,[64] that when the... issue concerns
a public right, it is sufficient that the petitioner is a citizen and has an interest in th... e execution of the
laws... n G.R. No. 171483, KMU's assertion that PP 1017 and G.O. No. 5 violated its right to peaceful
assembly may be deemed sufficient to give it legal standing. Organizations may be granted standing
to assert the rights of their members.[65] We take judicial notice of the announcement by the Office of
the President banning all rallies and canceling all permits for public assemblies following the issuance
of PP 1017 and G.O. No. 5.
In G.R. No. 171489, petitioners, Cadiz et al., who are national officers of the Integrated Bar of the
Philippines (IBP) have no legal standing, having failed to allege any direct or potential injury which the
IBP as an institution or its members may... suffer as a consequence of the issuance of PP No. 1017
and G.O. No. 5. In Integrated Bar of the Philippines v. Zamora,[66] the Court held that the mere
invocation by the IBP of its duty to preserve the rule of law and nothing more, while... undoubtedly
true, is not sufficient to clothe it with standing in this case. This is too general an interest which is
shared by other groups an
G.R. No. 171424, Loren Legarda has no personality as a taxpayer to file the instant petition as there
are no allegations of illegal disbursement of public funds. The fact that she is a former Senator is of
no consequence. She can no longer sue as a legislator on... the allegation that her prerogatives as a
lawmaker have been impaired by PP 1017 and G.O. No. 5
This Court holds that all the petitioners herein have locus standi.
B. SUBSTANTIVE
I. Review of Factual Bases
As to how the Court may inquire into the President's exercise of power, Lansang adopted the test that
"judicial inquiry can go no further than to satisfy the Court not that the President's decision is correct,"
but that "the
President did not act arbitrarily." Thus, the standard laid down is not correctness, but arbitrariness.
Petitioners failed to show that President Arroyo's exercise of the calling-out power, by issuing PP
1017, is totally bereft of factual basis. A reading of the Solicitor General's Consolidated Comment and
Memorandum shows a detailed narration of the events leading to the issuance... of PP 1017, with
supporting reports forming part of the records. Mentioned are the escape of the Magdalo Group, their
audacious threat of the Magdalo D-Day, the defections in the military, particularly in the Philippine
Marines, and the reproving statements from the... communist leaders. There was also the Minutes of
the Intelligence Report and Security Group of the Philippine Army showing the growing alliance
between the NPA and the military. Petitioners presented nothing to refute such events. Thus, absent
any contrary allegations, the Court... is convinced that the President was justified in issuing PP 1017
calling for military aid.
II. Constitutionality of PP 1017 and G.O. No. 5... verbreadth doctrine is an analytical tool developed
for testing "on their faces" statutes in free speech cases, also known under the American Law as First
Amendment cases.[103]
A plain reading of PP 1017 shows that it is not primarily directed to speech or even speech-related
conduct. It is actually a call upon the AFP to prevent or suppress all forms of lawless violence. In
United States v. Salerno,[104]... the US Supreme Court held that "we have not recognized an
"overbreadth' doctrine outside the limited context of the First Amendment" (freedom of speech).
Moreover, the overbreadth doctrine is not intended for testing the validity of a law that "reflects
legitimate state interest in maintaining comprehensive control over harmful, constitutionally
unprotected conduct." Undoubtedly, lawless violence, insurrection and rebellion are... considered
"harmful" and "constitutionally unprotected conduct." In Broadrick v. Oklahoma,[105] it was held:
Thus, claims of facial overbreadth are entertained in cases involving statutes which, by their terms,
seek to regulate only "spoken words" and again, that "overbreadth claims, if entertained at all, have
19
been curtailed when invoked against... ordinary criminal laws that are sought to be applied to
protected conduct."[
In other words, a facial challenge using the overbreadth doctrine will require the Court to examine PP
1017 and pinpoint its flaws and defects, not on the basis of its actual operation to petitioners, but on
the assumption or prediction that its very existence may cause... others not before the Court to refrain
from constitutionally protected speech or expression.
nd third, a facial challenge on the ground of overbreadth is the most difficult challenge to mount
successfully, since the challenger must establish that there can be no instance when the assailed law
may be valid. Here, petitioners did not even... attempt to show whether this situation exists
Petitioners likewise seek a facial review of PP 1017 on the ground of vagueness. This, too, is
unwarranted.
Related to the "overbreadth" doctrine is the "void for vagueness doctrine" which holds that "a law is
facially invalid if men of common intelligence must necessarily guess at its meaning and... differ as to
its application."[110] It is subject to... the same principles governing overbreadth doctrine. For one, it
is also an analytical tool for testing "on their faces" statutes in free speech cases. And like
overbreadth, it is said that a litigant may challenge a statute on its face only if it is vague in... all its
possib... sible applications.
Again, petitioners did not even attempt to show that PP 1017 is vague in all its application. They also
failed to establish that men of common intelligence cannot understand the meaning and application of
PP 1017.
The Court finds and so holds that PP 1017 is constitutional insofar as it constitutes a call by the
President for the AFP to prevent or suppress lawless violence. The proclamation is sustained by
Section 18, Article VII of the Constitution and the relevant... jurisprudence discussed earlier.
However, 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. The Court also rules that
under Section 17, Article XII of the Constitution, the President, in the... absence of a legislation,
cannot take over privately-owned public utility and private business affected with public interest.
Perhaps, the vital lesson that we must learn from the theorists who studied the various competing
political philosophies is that, it is possible to grant government the authority to cope with crises
without surrendering the two vital principles of constitutionalism: the... maintenance of legal limits to
arbitrary power, and political responsibility of the government to the governed.
WHEREFORE, the Petitions are partly granted. The Court rules that PP 1017 is CONSTITUTIONAL
insofar as it constitutes a call by President Gloria Macapagal-Arroyo on th... he AFP to prevent or
suppress lawless violence. However, the provisions of
PP 1017 commanding the AFP to enforce laws not related to lawle... ess... violence, as well as
decrees promulgated by the President, are declared UNCONSTITUTIONAL. In addition, the provision
in PP 1017 declaring national emergency under
UNCONSTITUTIONAL. In addition, the provision in PP 1017 declaring national emergency under
Section 17, Article VII of the
Constitution is CONSTITUTIONAL, but such declaration does not... uthorize the President to take
over privately-owned public utility or business affected with public interest without prior legislation.
G.O.
.O. No. 5 is CONSTITUTIONAL since it provides a standard by which the AFP and the PNP should
implement PP 1017, i.e. whatever is "necessary and appropriate actions and measures to suppress
and prevent acts of lawless violence." Considering that "acts... of terrorism" have not yet been defined
and made punishable by the Legislature, such portion of G.O. No. 5 is declared
UNCONSTITUTIONAL.
The warrantless arrest of Randolf S. David and Ronald Llamas; the dispersal and warrantless arrest
of the KMU and NAFLU-KMU members during their rallies, in the absence of proof that these
petitioners were committing acts constituting lawless violence, invasion or rebellion and... violating BP
880; the imposition of standards on media or any form of prior restraint on the press, as well as the
20
warrantless search of the Tribune offices and whimsical seizure of its articles for publication and other
materials, are declared
UNCONSTITUTIONAL.
Principles:
Moot and Academic Principle
But the power of judicial review does not repose upon the courts a "self-starting capacity."[23] Courts
may exercise such power only when the following requisites are present: first, there must be an actual
case or controversy;... second, petitioners have to raise a question of constitutionality; third, the
constitutional question must be raised at the earliest opportunity; and fourth, the decision of the
constitutional question must be necessary to the determination... of the case itself.[24]
An actual case or controversy involves a conflict of legal right, an opposite legal claims susceptible of
judicial resolution. It is "definite and concrete, touching the legal relations of parties having adverse
legal interest;" a real and substantial controversy admitting of... specific relief.
moot and academic case is one that ceases to present a justiciable controversy by virtue of
supervening events,[26] so that a declaration thereon would be of no practical use or value.[27]
Generally, courts decline jurisdiction over... such case[28] or dismiss it on ground of mootness.
ocus standi is defined as "a right of appearance in a court of justice on a given question."[37] In
private suits, standing is governed by the "real-parties-in interest" rule as contained in Section 2, Rule
3 of the 1997 Rules of Civil
Procedure, as amended. It provides that "every action must be prosecuted or defended in the name
of the real party in interest." Accordingly, the "real-party-in interest" is "the party who stands to be
benefited or injured by the judgment in the suit or the... party entitled to the avails of the suit."[38]
Succinctly put, the plaintiff's standing is based on his own right to the relief sought.
The same Court ruled that for a private individual to invoke the judicial power to... determine the
validity of an executive or legislative action, he must show that he has sustained a direct injury as a
result of that action, and it is not sufficient that he has a general interest common to all members of
the public.
This Court adopted the "direct injury" test in our jurisdiction. In People v. Vera,[44] it held that the
person who impugns the validity of a statute must have "a personal and substantial interest in the
case such that he has... sustained, or will sustain direct injury as a result." The Vera doctrine was
upheld in a litany of cases, such as, Custodio v. President of the Senate,[45] Manila Race Horse
Trainers' Association v. De la
Fuente,[46] Pascual v.
By way of summary, the following rules may be culled from the cases decided by this Court.
Taxpayers, voters, concerned citizens, and legislators may be accorded standing to sue, provided
that the following requirements are met:
(1) the cases involve constitutional issues;
(2) for taxpayers, there must be a claim of illegal disbursement of public funds or that the tax measure
is unconstitutional;
(3) for voters, there must be a showing of obvious interest in the validity of the election law in
question;
(4) for concerned citizens, there must be a showing that the issues raised are of transcendental
importance which must be settled early; and
(5) for legislators, there must be a claim that the official action complained of infringes upon their
prerogatives as legislators.

21
JOSE JESUS M. DISINI v. SECRETARY OF JUSTICE, GR No. 203335, 2014-02-18
Facts:
The Facts and the Case
The cybercrime law aims to regulate access to and use of the cyberspace.
This is cyberspace, a system that accommodates millions and billions of simultaneous and ongoing
individual accesses to and uses of the internet.
But all is not... well with the system since it could not filter out a number of persons of ill will who
would want to use cyberspace technology for mischiefs and crimes.
But petitioners claim that the means adopted by the cybercrime law for regulating undesirable
cyberspace activities violate certain of their constitutional rights
The government of course asserts that the law merely seeks to reasonably put order into cyberspace
activities,... punish wrongdoings, and prevent hurtful attacks on the system.
Pending hearing and adjudication of the issues presented in these cases, on February 5, 2013 the
Court extended the original 120-day temporary restraining order (TRO) that it earlier issued on
October 9, 2012, enjoining respondent government agencies from implementing the... cybercrime law
until further orders.

Issues:
Petitioners challenge the constitutionality of the following provisions of the cybercrime law that regard
certain acts as crimes and impose penalties for their commission as well as provisions that would
enable the government to track down and penalize violators.
Section 4(a)(1) on Illegal Access;
Section 4(a)(3) on Data Interference;
Section 4(a)(6) on Cyber-squatting;
Section 4(b)(3) on Identity Theft;
Section 4(c)(1) on Cybersex;
Section 4(c)(2) on Child Pornography;
Section 4(c)(3) on Unsolicited Commercial Communications;
Section 4(c)(4) on Libel;
Section 5 on Aiding or Abetting and Attempt in the Commission of Cybercrimes;
Section 6 on the Penalty of One Degree Higher;
Section 7 on the Prosecution under both the Revised Penal Code (RPC) and R.A. 10175;
Section 8 on Penalties;
Section 12 on Real-Time Collection of Traffic Data;
Section 13 on Preservation of Computer Data;
Section 14 on Disclosure of Computer Data;
Section 15 on Search, Seizure and Examination of Computer Data;
Section 17 on Destruction of Computer Data;
Section 19 on Restricting or Blocking Access to Computer Data;
Section 20 on Obstruction of Justice;
Section 24 on Cybercrime Investigation and Coordinating Center (CICC); and
Section 26(a) on CICC's Powers and Functions.
Ruling:
Section 4(a)(1)
Section 4. Cybercrime Offenses. The following acts constitute the offense of cybercrime punishable
under this Act:
(a) Offenses against the confidentiality, integrity and availability of computer data and systems:
The Court has in a way found the strict scrutiny standard, an American constitutional construct,[1]
useful in determining the constitutionality of laws that tend to target a class of things or persons.

22
G.R. No. 192088
VILLARAMA, JR., J.:
Before us is a petition for certiorari and prohibition seeking to permanently enjoin the sale of the
Angat Hydro-Electric Power Plant (AHEPP) to Korea Water Resources Corporation (K-Water) which
won the public bidding conducted by the Power Sector Assets and Liabilities Management
Corporation (PSALM).

The Facts

Respondent PSALM is a government-owned and controlled corporation created by virtue of Republic

Act No. 9136,[1] otherwise known as the "Electric Power Industry Reform Act of 2001" (EPIRA). The
EPIRA provided a framework for the restructuring of the electric power industry, including the
privatization of the assets of the National Power Corporation (NPC), the transition to the desired
competitive structure, and the definition of the responsibilities of the various government agencies
and private entities. Said law mandated PSALM to manage the orderly sale, disposition, and
privatization of NPC generation assets, real estate and other disposable assets, and Independent
Power Producer (IPP) contracts with the objective of liquidating all NPC financial obligations and
stranded contract costs in an optimal manner, which liquidation is to be completed within PSALM's
25-year term of existence.[2]

Sometime in August 2005, PSALM commenced the privatization of the 246-megawatt (MW) AHEPP
located in San Lorenzo, Norzagaray, Bulacan. AHEPP's main units built in 1967 and 1968, and 5
auxiliary units, form part of the Angat Complex which includes the Angat Dam, Angat Reservoir and
the outlying watershed area. A portion of the AHEPP -- the 10 MW Auxiliary Unit No. 4 completed on
June 16, 1986 and the 18 MW Auxiliary Unit No. 5 completed on January 14, 1993 -- is owned by
respondent Metropolitan Waterworks and Sewerage System (MWSS).[3] The main units produce a
total of 200 MW of power while the auxiliary units yield the remaining 46 MW of power. The Angat
Dam and AHEPP are utilized for power generation, irrigation, water supply and flood control
purposes. Because of its multi-functional design, the operation of the Angat Complex involves
various government agencies, namely: (1) NPC; (2) National Water Resources Board (NWRB); (3)
MWSS; (4) respondent National Irrigation Administration (NIA); and (5) Philippine Atmospheric,
Geophysical and Astronomical Services Administration (PAG-ASA).

On December 15, 2009, PSALM's Board of Directors approved the Bidding Procedures for the
privatization of the AHEPP. An Invitation to Bid was published on January 11, 12 and 13, 2010 in
three major national newspapers. Subject of the bid was the AHEPP consisting of 4 main units and 3
auxiliary units with an aggregate installed capacity of 218 MW. The two auxiliary units owned by
MWSS were excluded from the bid.

The following terms and conditions for the purchase of AHEPP were set forth in the Bidding Package:

IB-05 CONDITION OF THE SALE

The Asset shall be sold on an "AS IS, WHERE IS" basis.

The Angat Dam (which is part of the Non-Power Components) is a multi-purpose hydro facility which
currently supplies water for domestic use, irrigation and power generation. The four main units of the
Angat Plant release water to an underground trailrace that flows towards the Bustos Dam which is
owned and operated by the National Irrigation Administration ("NIA") and provides irrigation
requirements to certain areas in Bulacan. The water from the auxiliary units 1, 2 and 3 flows to the
Ipo Dam which is owned and operated by MWSS and supplies domestic water to Metro Manila and
other surrounding cities.

The priority of water usage under Philippine Law would have to be observed by the
Buyer/Operator.

The Winning Bidder/Buyer shall be requested to enter into an operations and maintenance
agreement with PSALM for the Non-Power Components in accordance with the terms and
conditions of the O & M Agreement to be issued as part of the Final Transaction Documents. The
Buyer, as Operator, shall be required to operate and maintain the Non-Power Components at its own
cost and expense.

PSALM is currently negotiating a water protocol agreement with various parties which are currently

23
the MWSS, NIA, the National Water Resources Board and NPC. If required by PSALM, the Buyer
will be required to enter into the said water protocol agreement as a condition to the award of
the Asset.

The Buyer shall be responsible for securing the necessary rights to occupy the land underlying the
Asset.[4] (Emphasis supplied.)

All participating bidders were required to comply with the following: (a) submission of a Letter of
Interest; (b) execution of Confidentiality Agreement and Undertaking; and (c) payment of a non-
refundable fee of US$ 2,500 as Participation Fee.[5] After holding pre-bid conferences and forum
discussions with various stakeholders, PSALM received the following bids from six competing firms:

K-Water US$ 440,880,000.00

First Gen Northern Energy Corporation 365,000,678.00
San Miguel Corporation 312,500,000.00
SN Aboitiz Power-Pangasinan, Inc. 256,000,000.00
Trans-Asia Oil & Energy Development Corporation 237,000,000.00
DMCI Power Corporation 188,890,000.00

On May 5, 2010, and after a post-bid evaluation, PSALM's Board of Directors approved and
confirmed the issuance of a Notice of Award to the highest bidder, K-Water. [6]

On May 19, 2010, the present petition with prayer for a temporary restraining order (TRO) and/or writ
of preliminary injunction was filed by the Initiatives for Dialogue and Empowerment Through
Alternative Legal Services, Inc. (IDEALS), Freedom from Debt Coalition (FDC), AKBAYAN Citizen's
Action Party (AKBAYAN) and Alliance of Progressive Labor.

On May 24, 2010, this Court issued a Status Quo Ante Order directing the respondents to maintain
the status quo prevailing before the filing of the petition and to file their respective Comments on the
petition.[7]

Arguments of the Parties

Petitioners contend that PSALM gravely abused its discretion when, in the conduct of the bidding it
disregarded and violated the people's right to information guaranteed under the Constitution, as
follows: (1) the bidding process was commenced by PSALM without having previously released to the
public critical information such as the terms and conditions of the sale, the parties qualified to bid and
the minimum bid price, as laid down in the case of Chavez v. Public Estates Authority[8]; (2) PSALM
refused to divulge significant information requested by petitioners, matters which are of public
concern; and (3) the bidding was not conducted in an open and transparent manner, participation was
indiscriminately restricted to the private sectors in violation of the EPIRA which provides that its
provisions shall be "construed in favor of the establishment, promotion, preservation of competition
and people empowerment so that the widest participation of the people, whether directly or indirectly,
is ensured."[9]

Petitioners also assail the PSALM in not offering the sale of the AHEPP to MWSS which co-owned
the Angat Complex together with NPC and NIA. Being a mere co-owner, PSALM cannot sell the
AHEPP without the consent of co-owners MWSS and NIA, and being an indivisible thing, PSALM has
a positive obligation to offer its undivided interest to the other co-owners before selling the same to an
outsider. Hence, PSALM's unilateral disposition of the said hydro complex facility violates the Civil
Code rules on co-ownership (Art. 498) and Sec. 47 (e) of the EPIRA which granted PSALM the legal
option of transferring possession, control and operation of NPC generating assets like the AHEPP to
another entity in order "to protect potable water, irrigation and all other requirements imbued with
public interest."

As to the participation in the bidding of and award of contract to K-Water which is a foreign
corporation, petitioners contend that PSALM clearly violated the constitutional provisions on the
appropriation and utilization of water as a natural resource, as implemented by the Water Code of the
Philippines limiting water rights to Filipino citizens and corporations which are at least 60% Filipino-
owned. Further considering the importance of the Angat Dam which is the source of 97% of Metro
Manila's water supply, as well as irrigation for farmlands in 20 municipalities and towns in Pampanga
and Bulacan, petitioners assert that PSALM should prioritize such domestic and community use of
water over that of power generation. They maintain that the Philippine Government, along with its
24
agencies and subdivisions, have an obligation under international law, to recognize and protect the
legally enforceable human right to water of petitioners and the public in general.

Petitioners cite the Advisory on the "Right to Water in Light of the Privatization of the Angat Hydro-
Electric Power Plant"[10] dated November 9, 2009 issued by the Commission on Human Rights (CHR)
urging the Government to revisit and reassess its policy on water resources vis-à-vis its concurrent
obligations under international law to provide, and ensure and sustain, among others, "safe, sufficient,
affordable and convenient access to drinking water." Since investment in hydropower business is
primarily driven by generation of revenues both for the government and private sector, the CHR
warns that once the AHEPP is privatized, there will be less accessible water supply, particularly for
those living in Metro Manila and the Province of Bulacan and nearby areas which are currently
benefited by the AHEPP. The CHR believes that the management of AHEPP is better left to MWSS
being a government body and considering the public interest involved. However, should the decision
to privatize the AHEPP become inevitable, the CHR strongly calls for specific and concrete
safeguards to ensure the right to water of all, as the domestic use of water is more fundamental than
the need for electric power.

Petitioners thus argue that the protection of their right to water and of public interest requires that the
bidding process initiated by PSALM be declared null and void for violating such right, as defined by
international law and by domestic law establishing the State's obligation to ensure water security for
its people.

In its Comment With Urgent Motion to Lift Status Quo Ante Order, respondent PSALM prayed for the
dismissal of the petition on the following procedural grounds: (a) a petition for certiorari is not the
proper remedy because PSALM was not acting as a tribunal or board exercising judicial or quasi-
judicial functions when it commenced the privatization of AHEPP; (b) the present petition is rendered
moot by the issuance of a Notice of Award in favor of K-Water; (c) assuming the petition is not
mooted by such contract award, this Court has no jurisdiction over the subject matter of the
controversy involving a political question, and also because if it were the intent of Congress to
exclude the AHEPP in the privatization of NPC assets, it should have clearly expressed such intent
as it did with the Agus and Pulangui power plants under Sec. 47 of the EPIRA; (d) petitioners' lack of
standing to question the bidding process for failure to show any injury as a result thereof, while Rep.
Walden Bello likewise does not have such legal standing in his capacity as a duly elected member of
the House of Representatives as can be gleaned from the rulings in David v. Arroyo[11] and Philippine
Constitutional Association v. Enriquez.[12]

On the alleged violation of petitioners' right to information, PSALM avers that it conducted the bidding
in an open and transparent manner, through a series of events in accordance with the governing
rules on public bidding. The non-disclosure of certain information in the invitation to bid was
understandable, such as the minimum or reserve price which are still subject to negotiation and
approval of PSALM's Board of Directors. The ruling in Chavez v. Public Estates Authority[13]is
inapplicable since it involved government property which has become unserviceable or was no longer
needed and thus fell under Sec. 79 of the Government Auditing Code whereas the instant case
concerns a hydroelectric power plant adjacent to a dam which still provides water supply to Metro
Manila. In the bidding for the AHEPP, PSALM claims that it relied on the Rules and Regulations
Implementing the EPIRA, as well as COA Circular No. 89-296 on the general procedures for bidding
by government agencies and instrumentalities of assets that will be divested or government property
that will be disposed of. PSALM likewise avers that it was constrained to deny petitioner IDEALS'
letter dated April 20, 2010 requesting documents relative to the privatization of Angat Dam due to
non-submission of a Letter of Interest, Confidentiality and Undertaking and non-payment of the
Participation Fee. With regard to IDEALS' request for information about the winning bidder, as
contained in its letter dated May 14, 2010, the same was already referred to respondent K-Water's
counsel for appropriate action. In any case, PSALM maintains that not all details relative to the
privatization of the AHEPP can be readily disclosed; the confidentiality of certain matters was
necessary to ensure the optimum bid price for the property.

PSALM further refutes the assertion of petitioners that the Angat Complex is an indivisible system
and co-owned with MWSS and NIA. It contends that MWSS's contribution in the funds used for the
construction of the AHEPP did not give rise to a regime of co-ownership as the said funds were
merely in exchange for the supply of water that MWSS would get from the Angat Dam, while the
Umiray-AngatTransbasin Rehabilitation Project the improvement and repair of which were funded by
MWSS, did not imply a co-ownership as these facilities are located in remote places. Moreover,
PSALM points out that PSALM, MWSS and NIA each was issued a water permit, and are thus
holders of separate water rights.

25
On the alleged violation of petitioners' and the people's right to water, PSALM contends that such is
baseless and proceeds from the mistaken assumption that the Angat Dam was sold and as a result
thereof, the continuity and availability of domestic water supply will be interrupted. PSALM stresses
that only the hydroelectric facility is being sold and not the Angat Dam which remains to be owned by
PSALM, and that the NWRB still governs the water allocation therein while the NPC-FFWSDO still
retains exclusive control over the opening of spillway gates during rainy season. The foregoing
evinces the continued collective control by government agencies over the Angat Dam, which in the
meantime, is in dire need of repairs, the cost of which cannot be borne by the Government.

PSALM further debunks the nationality issue raised by petitioners, citing previous opinions rendered
by the Department of Justice (DOJ) consistently holding that the utilization of water by a hydroelectric
power plant does not constitute appropriation of water from its natural source considering that the
source of water (dam) that enters the intake gate of the power plant is an artificial structure.
Moreover, PSALM is mindful of the State's duty to protect the public's right to water when it sold the
AHEPP. In fact, such concern as taken into consideration by PSALM in devising a privatization
scheme for the AHEPP whereby the water allocation is continuously regulated by the NWRB and the
dam and its spillway gates remain under the ownership and control of NPC.

In its Comment,[14] respondent MWSS asserts that by virtue of its various statutory powers since its
creation in 1971, which includes the construction, maintenance and operation of dams, reservoir and
other waterworks within its territorial jurisdiction, it has supervision and control over the Angat Dam
given that the Angat Reservoir supplies approximately 97% of the water requirements of Metro
Manila. Over the course of its authority over the Angat Dam, Dykes and Reservoir, MWSS has
incurred expenses to maintain their upkeep, improve and upgrade their facilities. Thus, in 1962,
MWSS contributed about 20% for the construction cost of the Angat Dam and Dykes (then equivalent
to about P21 million); in 1992, MWSS contributed about P218 million for the construction of Auxiliary
Unit No. 5; in 1998, MWSS contributed P73.5 million for the construction cost of the low level outlet;
and subsequently, MWSS invested P3.3 billion to build the Umiray-AngatTransbasin Tunnel to
supplement the water supply available from the Angat Dam, which tunnel contributes a minimum of
about 9 cubic meters per second to the Angat Reservoir, thus increasing power generation. MWSS
argues that its powers over waterworks are vested upon it by a special law (MWSS Charter) which
prevails over the EPIRA which is a general law, as well as other special laws, issuances and
presidential edicts. And as contained in Sec. 1 of the MWSS Charter, which remains valid and
effective, it is expressly provided that the establishment, operation and maintenance of waterworks
systems must always be supervised by the State.

MWSS further alleges that after the enactment of EPIRA, it had expressed the desire to acquire
ownership and control of the AHEPP so as not to leave the operation of the Angat Reservoir to
private discretion that may prejudice the water allocation to MWSS as dictated by NWRB rules.
Representations were thereafter made with the Office of the President (OP) for the turn over of the
management of these facilities to MWSS, and joint consultation was also held with PSALM officials
for the possibility of a Management Committee to manage and control the Angat Dam Complex under
the chairmanship of the water sector, which position was supported by former Secretary
HermogenesEbdane of the Department of Public Works and Highways (DPWH). In March 2008,
PSALM proposed the creation of an inter-agency technical working group (TWG) to draft the
Operations and Maintenance (O & M) Agreement for the AHEPP that will be in effect after its
privatization. PSALM likewise sought the view of the Office of the Government Corporate Counsel
(OGCC) which opined that PSALM may turn over the facility to a qualified entity such as MWSS
without need of public bidding. In 2009, various local governments supported the transfer of the
control and management of the AHEPP to MWSS, while the League of Cities and Municipalities
interposed its opposition to the privatization of the AHEPP fearing that it might increase the cost of
water in Metro Manila, and also because it will be disadvantageous to the national government since
the AHEPP only contributes 246 MW of electricity to the Luzon Grid. Even the CHR has advised the
Government to reassess its privatization policy and to always consider paramount the most basic
resources necessary and indispensable for human survival, which includes water.

MWSS further avers that upon the facilitation of the OGCC and participated in by various
stakeholders, including its two concessionaires, Manila Water Company, Inc. and Maynilad Water
Services, Inc., various meetings and conferences were held relative to the drafting of the
Memorandum of Agreement on the Angat Water Protocol. On April 20, 2010, the final draft of the
Angat Water Protocol was finally complete. However, as of June 18, 2010, only MWSS and NIA
signed the said final draft. MWSS thus contends that PSALM failed to institute any safeguards as
prescribed in Sec. 47 of the EPIRA when it proceeded with the privatization of the AHEPP.

As to the issue of nationality requirement in the appropriation of water resources under

26
the Constitution, MWSS cites the case of Manila Prince Hotel v. Government Service Insurance
System[15] which interpreted paragraph 2, Sec. 10, Art. XII of the 1987 Constitution providing that "[i]n
the grant of rights, privileges, and concessions covering the national economy and patrimony, the
State shall give preference to qualified Filipinos" to imply "a mandatory, positive command which is
complete in itself and which needs no further guidelines or implementing laws or rules for its
enforcement x xx and is per se judicially enforceable." In this case, the AHEPP is in dire danger of
being wholly-owned by a Korean corporation which probably merely considers it as just another
business opportunity, and as such cannot be expected to observe and ensure the smooth facilitation
of the more critical purposes of water supply and irrigation.

Respondent First Gen Northern Energy Corporation (FGNEC) also filed a Comment [16] disagreeing
with the contentions of petitioners and respondent MWSS on account of the following: (1) the NPC
charter vested upon it complete jurisdiction and control over watersheds like the Angat Watershed
surrounding the reservoir of the power plants, and hence Art. 498 of the Civil Code is inapplicable; (2)
NPC, MWSS and NIA are not co-owners of the various rights over the Angat Dam as in fact each of
them holds its own water rights; (3) the State through the EPIRA expressly mandates PSALM to
privatize all NPC assets, which necessarily includes the AHEPP; (4) the privatization of the AHEPP
will not affect the priority of water for domestic and municipal uses as there are sufficient safeguards
to ensure the same, and also because the Water Code specifically mandates that such use shall take
precedence over other uses, and even the EPIRA itself gives priority to use of water for domestic
and municipal purposes over power generation; (5) the Water Protocol also safeguards priority of use
of water for domestic purposes; (6) the bidding procedure for the AHEPP was valid, and the bidding
was conducted by PSALM in an open and transparent manner; and (7) the right to information of
petitioners and the public in general was fully satisfied, and PSALM adopted reasonable rules and
regulations for the orderly conduct of its functions pursuant to its mandate under the EPIRA.

FGNEC nevertheless prays of this Court to declare the nationality requirements for the ownership,
operation and maintenance of the AHEPP as prescribed by the Constitution and pertinent laws.
Considering the allegation of petitioners that K-Water is owned by the Republic of South Korea,
FGNEC asserts that PSALM should not have allowed said entity to participate in the bidding because
under our Constitution, the exploration, development and utilization of natural resources are reserved
to Filipino citizens or to corporations with 60% of their capital being owned by Filipinos.

Respondent NIA filed its Comment[17] stating that its interest in this case is limited only to the
protection of its water allocation drawn from the Angat Dam as determined by the NWRB.
Acknowledging that it has to share the meager water resources with other government agencies in
fulfilment of their respective mandate, NIA submits that it is willing to sit down and discuss issues
relating to water allocation, as evidenced by the draft Memorandum of Agreement on the Angat Water
Protocol. Since the reliefs prayed for in the instant petition will not be applicable to NIA which was not
involved in the bidding conducted by PSALM, it will thus not be affected by the outcome of the case.

Respondents San Miguel Corporation (SMC), DMCI Power Corporation, Trans-Asia Oil and Energy
Development Corporation and SNAboitiz Power-Pangasinan, Inc. filed their respective
Comments[18] with common submission that they are not real parties-in-interest and should be
excluded from the case. They assert that PSALM acted pursuant to its mandate to privatize the
AHEPP when it conducted the bidding, and there exists no reason for them to take any action to
invalidate the said bidding wherein they lost to the highest bidder K-Water.

On its part, respondent K-Water filed a Manifestation In Lieu of Comment[19] stating that it is not in a
position to respond to petitioners' allegations, having justifiably relied on the mandate and expertise of
PSALM in the conduct of public bidding for the privatization of the AHEPP and had no reason to
question the legality or constitutionality of the privatization process, including the bidding. K-Water
submits that its participation in the bidding for the AHEPP was guided at all times by an abiding
respect for the Constitution and the laws of the Philippines, and hopes for a prompt resolution of the
present petition to further strengthen and enhance the investment environment considering the level
of investment entailed, not only in financial terms by providing a definitive resolution and reliable
guidance for investors, whether Filipino or foreign, as basis for effective investment and business
decisions.

In their Consolidated Reply,[20] petitioners contend that the instant petition is not mooted with the
issuance of a Notice of Award to K-Water because the privatization of AHEPP is not finished until and
unless the deed of absolute sale has been executed. They cite the ruling in David v. Arroyo,[21] that
courts will decide cases, otherwise moot and academic, if: first, there is a grave violation of the
Constitution; second, the exceptional character of the situation and the paramount public interest is
involved; third, when constitutional issue raised requires formulation of controlling principles to guide

27
the bench, the bar and the public; and fourth, the case is capable of repetition yet evading review.

Petitioners reiterate their legal standing to file the present suit in their capacity as taxpayers, or as
Filipino citizens asserting the promotion and protection of a public right, aside from being directly
injured by the proceedings of PSALM. As to the absence of Certification and Verification of Non-
Forum Shopping from petitioner Bello in the file copy of PSALM, the same was a mere inadvertence
in photocopying the same.

On the matter of compliance with an open and transparent bidding, petitioners also reiterate as held
in Chavez v. Public Estates Authority,[22] that the Court's interpretation of public bidding applies to any
law which requires public bidding, especially since Sec. 79 of the Government Auditing Code does
not enumerate the data that must be disclosed to the public. PSALM should have followed the
minimum requirements laid down in said case instead of adopting the "format generally used by
government entities in their procurement of goods, infrastructure and consultancy services,"
considering that what was involved in Chavez is an amended Joint Venture Agreement which seeks
to transfer title and ownership over government property. Petitioners point out that the requirement
under COA Circular 89-296 as regards confidentiality covers only sealed proposals and not all
information relating to the AHEPP privatization. PSALM's simple referral of IDEALS' request letter to
the counsel of K-Water is very telling, indicating PSALM's limited knowledge about a company it
allowed to participate in the bidding and which even won the bidding.

On the transfer of water rights to K-Water, petitioners reiterate that this violates the Water Code, and
contrary to PSALM's statements, once NPC transfers its water permit to K-Water, in accordance with
the terms of the Asset Purchase Agreement, NPC gives up its authority to extract or utilize water from
the Angat River. Petitioners further assert that the terms of the sale of AHEPP allowing the buyer the
operation and management of the Non-Power Components, constitutes a relinquishment of
government control over the Angat Dam, in violation of Art. XII, Sec. 2 of the Constitution. PSALM
likewise has not stated that all stakeholders have signed the Water Protocol. Such absence of a
signed Water Protocol is alarming in the light of PSALM's pronouncement that the terms of the sale to
K-Water would still subject to negotiation. Is PSALM's refusal to sign the Water Protocol part of its
strategy to negotiate the terms of the sale with the bidders? If so, then PSALM is blithely and
cavalierly bargaining away the Filipinos' right to water.

Responding to the claims of MWSS in its Comment, PSALM contends that MWSS's allegations
regarding the bidding process is belied by MWSS's own admission that it held discussions with
PSALM to highlight the important points and issues surrounding the AHEPP privatization that needed
to be threshed out. Moreover, MWSS also admits having participated, along with other agencies and
stakeholders, various meetings and conferences relative to the drafting of a Memorandum of
Agreement on the Angat Water Protocol.

As regards the Angat Dam, PSALM emphasizes that MWSS never exercised jurisdiction and control
over the said facility. PSALM points out that the Angat Dam was constructed in 1967, or four years
before the enactment of Republic Act No. 6234, upon the commissioning thereof by the NPC and the
consequent construction by Grogun, Inc., a private corporation. MWSS' attempt to base its claim of
jurisdiction over the Angat Dam upon its characterization of EPIRA as a general law must likewise
fail. PSALM explains that EPIRA cannot be classified as a general law as it applies to a particular
portion of the State, i.e., the energy sector. The EPIRA must be deemed an exception to the
provision in the Revised MWSS Charter on MWSS's general jurisdiction over waterworks systems.

PSALM stresses that pursuant to the EPIRA, PSALM took ownership of all existing NPC generation
assets, liabilities, IPP contracts, real estate and other disposable assets, which necessarily includes
the AHEPP Complex, of which the Angat Dam is part. As to the OGCC opinion cited by MWSS to
support its position that control and management of the Angat Dam Complex should be turned over to
MWSS, the OGCC had already issued a second opinion dated August 20, 2008 which clarified the
tenor of its earlier Opinion No. 107, s. 2008, stating that "the disposal of the [Angat] HEPP by sale
through public bidding the principal mode of disposition under [EPIRA] remains PSALM's primary
option." Moreover, as pointed out by the National Economic Development Authority (NEDA) in its
letter dated September 16, 2009, the ownership and operation of a hydropower plant goes beyond
the mandate of MWSS. This view is consistent with the provisions of EPIRA mandating the transfer
of ownership and control of NPC generation assets, IPP Contracts, real estate and other disposable
assets to a private person or entity. Consequently, a transfer to another government entity of the said
NPC assets would be a clear violation of the EPIRA. Even assuming such is allowed by EPIRA, it
would not serve the objective of the EPIRA, i.e., that of liquidating all NPC's financial obligations and
would merely transfer NPC's debts from the hands of one government entity to another, the funds that
would be utilized by MWSS in the acquisition of the AHEPP would doubtless come from the pockets

28
of the Filipino people.

As regards the opposition of various local government units to the sale of the AHEPP, PSALM said
that a forum was held specifically to address their concerns. After the said forum, these LGUs did not
anymore raise the same concerns; such inaction on their part could be taken as an acquiescence to,
and acceptance of, the explanations made by PSALM during the forum. PSALM had made it clear
that it is only the AHEPP and not the Angat Dam which was being privatized. The same wrong
premise underpinned the position of the CHR with its erroneous allegation that MWSS is allowed,
under its Revised Charter, to operate and maintain a power plant.

PSALM further contends that the sale of AHEPP to K-Water did not violate the Constitution's
provision on the State's natural resources and neither is the ruling in Manila Prince Hotel applicable
as said case was decided under different factual circumstances. It reiterates that the AHEPP, being a
generation asset, can be sold to a foreign entity, under the EPIRA, in accordance with the policy
reforms said law introduced in the power sector; the EPIRA aims to enable open access in the
electricity market and then enable the government to concentrate more fully on the supply of basic
needs to the Filipino people. Owing to the competitive and open nature of the generation sector,
foreign corporation may own generation assets.

Issues

The present controversy raised the following issues:

1) Legal standing of petitioners;

2) Mootness of the petition;
3) Violation of the right to information;
4) Ownership of the AHEPP;
5) Violation of Sec. 2, Art. XII of the Constitution;
6) Violation of the Water Code provisions on the grant of water rights; and
7) Failure of PSALM to comply with Sec. 47 (e) of EPIRA.

Mootness and Locus Standi

PSALM's contention that the present petition had already been mooted by the issuance of the Notice
of Award to K-Water is misplaced. Though petitioners had sought the immediate issuance of
injunction against the bidding commenced by PSALM -- specifically enjoining it from proceeding to
the next step of issuing a notice of award to any of the bidders -- they further prayed that PSALM be
permanently enjoined from disposing of the AHEPP through privatization. The petition was thus filed
not only as a means of enforcing the State's obligation to protect the citizens' "right to water" that is
recognized under international law and legally enforceable under our Constitution, but also to bar a
foreign corporation from exploiting our water resources in violation of Sec. 2, Art. XII of the 1987
Constitution. If the impending sale of the AHEPP to K-Water indeed violates the Constitution, it is the
duty of the Court to annul the contract award as well as its implementation. As this Court held
in Chavez v. Philippine Estates Authority,[23] "[s]upervening events, whether intended or accidental,
cannot prevent the Court from rendering a decision if there is a grave violation of the Constitution."

We also rule that petitioners possess the requisite legal standing in filing this suit as citizens and
taxpayers.

"Legal standing" or locus standi has been defined as a personal and substantial interest in the case
such that the party has sustained or will sustain direct injury as a result of the governmental act that is
being challenged, alleging more than a generalized grievance. The gist of the question of standing is
whether a party alleges "such personal stake in the outcome of the controversy as to assure that
concrete adverseness which sharpens the presentation of issues upon which the court depends for
illumination of difficult constitutional questions."[24] This Court, however, has adopted a liberal attitude
on the locus standi of a petitioner where the petitioner is able to craft an issue of transcendental
significance to the people, as when the issues raised are of paramount importance to the public. [25]
Thus, when the proceeding involves the assertion of a public right, the mere fact that the petitioner is
a citizen satisfies the requirement of personal interest.[26]

There can be no doubt that the matter of ensuring adequate water supply for domestic use is one of
paramount importance to the public. That the continued availability of potable water in Metro Manila
might be compromised if PSALM proceeds with the privatization of the hydroelectric power plant in
29
the Angat Dam Complex confers upon petitioners such personal stake in the resolution of legal issues
in a petition to stop its implementation.

Moreover, we have held that if the petition is anchored on the people's right to information on matters
of public concern, any citizen can be the real party in interest. The requirement of personal interest is
satisfied by the mere fact that the petitioner is a citizen, and therefore, part of the general public which
possesses the right. There is no need to show any special interest in the result. It is sufficient that
petitioners are citizens and, as such, are interested in the faithful execution of the laws. [27]

Violation of Right to Information

The people's right to information is provided in Section 7, Article III of the Constitution, which reads:

Sec. 7. The right of the people to information on matters of public concern shall be
recognized. Access to official records, and to documents, and papers pertaining to official acts,
transactions, or decisions, as well as to government research data used as basis for policy
development, shall be afforded the citizen, subject to such limitations as may be provided by law.
(Emphasis supplied.)

The people's constitutional right to information is intertwined with the government's constitutional duty
of full public disclosure of all transactions involving public interest.[28] Section 28, Article II of
the Constitution declares the State policy of full transparency in all transactions involving public
interest, to wit:

Sec. 28. Subject to reasonable conditions prescribed by law, the State adopts and implements
a policy of full public disclosure of all its transactions involving public interest. (Italics supplied.)

The foregoing constitutional provisions seek to promote transparency in policy-making and in the
operations of the government, as well as provide the people sufficient information to exercise
effectively other constitutional rights. They are also essential to hold public officials "at all times x xx
accountable to the people," for unless citizens have the proper information, they cannot hold public
officials accountable for anything. Armed with the right information, citizens can participate in public
discussions leading to the formulation of government policies and their effective implementation. An
informed citizenry is essential to the existence and proper functioning of any democracy.[29]

Consistent with this policy, the EPIRA was enacted to provide for "an orderly and transparent
privatization" of NPC's assets and liabilities.[30] Specifically, said law mandated that "[a]ll assets of
NPC shall be sold in an open and transparent manner through public bidding."[31]

In Chavez v. Public Estates Authority[32] involving the execution of an Amended Joint Venture
Agreement on the disposition of reclaimed lands without public bidding, the Court held:

x x x Before the consummation of the contract, PEA must, on its own and without demand
from anyone, disclose to the public matters relating to the disposition of its property. These
include the size, location, technical description and nature of the property being disposed of, the
terms and conditions of the disposition, the parties qualified to bid, the minimum price and similar
information. PEA must prepare all these data and disclose them to the public at the start of the
disposition process, long before the consummation of the contract, because the Government Auditing
Code requires public bidding. If PEA fails to make this disclosure, any citizen can demand from PEA
this information at any time during the bidding process.

Information, however, on on-going evaluation or review of bids or proposals being undertaken

by the bidding or review committee is not immediately accessible under the right to
information. While the evaluation or review is still on-going, there are no "official acts, transactions,
or decisions" on the bids or proposals. However, once the committee makes its official
recommendation, there arises a "definite proposition" on the part of the government. From this
moment, the public's right to information attaches, and any citizen can access all the non-proprietary
information leading to such definite proposition. In Chavez v. PCGG, the Court ruled as follows:

30
"Considering the intent of the framers of the Constitution, we believe that it is incumbent upon the
PCGG and its officers, as well as other government representatives, to disclose sufficient public
information on any proposed settlement they have decided to take up with the ostensible owners and
holders of ill-gotten wealth. Such information, though, must pertain to definite propositions of
the government not necessarily to intra-agency or inter-agency recommendations or
communications during the stage when common assertions are still in the process of being
formulated or are in the "exploratory" stage. There is need, of course, to observe the same
restrictions on disclosure of information in general, as discussed earlier such as on matters involving
national security, diplomatic or foreign relations, intelligence and other classified information."
(Emphasis supplied.)

Chavez v. Public Estates Authority thus laid down the rule that the constitutional right to information
includes official information on on-going negotiations before a final contract. The information,
however, must constitute definite propositions by the government and should not cover recognized
exceptions like privileged information, military and diplomatic secrets and similar matters affecting
national security and public order. In addition, Congress has prescribed other limitations on the right
to information in several legislations.[33]

In this case, petitioners' first letter dated April 20, 2010 requested for documents such as Terms of
Reference and proposed bids submitted by the bidders. At that time, the bids were yet to be
submitted at the bidding scheduled on April 28, 2010. It is also to be noted that PSALM's website
carried news and updates on the sale of AHEPP, providing important information on bidding activities
and clarifications regarding the terms and conditions of the Asset Purchase Agreement (APA) to be
signed by PSALM and the winning bidder (Buyer).[34]

In Chavez v. National Housing Authority,[35] the Court held that pending the enactment of an enabling
law, the release of information through postings in public bulletin boards and government websites
satisfies the constitutional requirement, thus:

It is unfortunate, however, that after almost twenty (20) years from birth of the 1987 Constitution,
there is still no enabling law that provides the mechanics for the compulsory duty of government
agencies to disclose information on government transactions. Hopefully, the desired enabling law will
finally see the light of day if and when Congress decides to approve the proposed "Freedom of
Access to Information Act." In the meantime, it would suffice that government agencies post on
their bulletin boards the documents incorporating the information on the steps and
negotiations that produced the agreements and the agreements themselves, and if finances
permit, to upload said information on their respective websites for easy access by interested
parties. Without any law or regulation governing the right to disclose information, the NHA or any of
the respondents cannot be faulted if they were not able to disclose information relative to the SMDRP
to the public in general.[36] (Emphasis supplied.)

The Court, however, distinguished the duty to disclose information from the duty to permit access to
information on matters of public concern under Sec. 7, Art. III of the Constitution. Unlike the
disclosure of information which is mandatory under the Constitution, the other aspect of the people's
right to know requires a demand or request for one to gain access to documents and paper of the
particular agency. Moreover, the duty to disclose covers only transactions involving public interest,
while the duty to allow access has a broader scope of information which embraces not only
transactions involving public interest, but any matter contained in official communications and public
documents of the government agency.[37] Such relief must be granted to the party requesting access
to official records, documents and papers relating to official acts, transactions, and decisions that are
relevant to a government contract.

Here, petitioners' second letter dated May 14, 2010 specifically requested for detailed information
regarding the winning bidder, such as company profile, contact person or responsible officer, office
address and Philippine registration. But before PSALM could respond to the said letter, petitioners
filed the present suit on May 19, 2010. PSALM's letter-reply dated May 21, 2010 advised petitioners
that their letter-re quest was referred to the counsel of K-Water. We find such action insufficient
compliance with the constitutional requirement and inconsistent with the policy under EPIRA to
implement the privatization of NPC assets in an "open and transparent" manner. PSALM's evasive
response to the request for information was unjustified because all bidders were required to deliver
documents such as company profile, names of authorized officers/representatives, financial and
technical experience.

31
Consequently, this relief must be granted to petitioners by directing PSALM to allow petitioners
access to the papers and documents relating to the company profile and legal capacity of the winning
bidder. Based on PSALM's own press releases, K-Water is described as a Korean firm with
extensive experience in implementing and managing water resources development projects in South
Korea, and also contributed significantly to the development of that country's heavy and chemical
industries and the modernization of its national industrial structure.

Angat HEPP is Under the Jurisdiction of

the Department of Energy Through NPC

It must be clarified that though petitioners had alleged a co-ownership by virtue of the joint
supervision in the operation of the Angat Complex by MWSS, NPC and NIA, MWSS actually
recognized the ownership and jurisdiction of NPC over the hydroelectric power plant itself. While
MWSS had initially sought to acquire ownership of the AHEPP without public bidding, it now prays
that PSALM be ordered to turn over the possession and control of the said facility to MWSS. MWSS
invokes its own authority or "special powers" by virtue of its general jurisdiction over waterworks
systems, and in consideration of its substantial investments in the construction of two auxiliary units in
the AHEPP, as well as the construction of the Umiray-AngatTransbasin Tunnel to supplement the
water intake at the Angat Reservoir which resulted in increased power generation.

Records disclosed that as early as December 2005, following the decision of PSALM's Board of
Directors to commence the sale process of the AHEPP along with Magat and AmlanHEPPs in August
2005, MWSS was actively cooperating and working with PSALM regarding the proposed Protocol for
the Privatization of the AHEPP, specifically on the terms and conditions for the management, control
and operation of the Angat Dam Complex taking into consideration the concerns of its
concessionaires. A Technical Working Group (TWG) similar to that formed for the Operation and
Management Agreement of Pantabangan and Magat dams was created, consisting of representatives
from PSALM, MWSS and other concerned agencies, to formulate strategies for the effective
implementation of the privatization of AHEPP and appropriate structure for the operation and
management of the Angat Dam Complex.[38]

In March 2008, PSALM sought legal advice from the OGCC on available alternatives to a sale
structure for the AHEPP. On May 27, 2008, then Government Corporate Counsel Alberto C. Agra
issued Opinion No. 107, s. 2008[39] stating that PSALM is not limited to "selling" as a means of fulfilling
its mandate under the EPIRA, and that in dealing with the AHEPP, PSALM has the following options:

1. Transfer the ownership, possession, control, and operation of the Angat Facility to another
entity, which may or may not be a private enterprise, as specifically provided under Section 47
(e) of RA 9136;
2. Transfer the Angat Facility, through whatever form, to another entity for the purpose of
protecting the public interest.[40]

The OGCC cited COA Circular No. 89-296 which provides that government property or assets that
are no longer serviceable or needed "may be transferred to other government entities/agencies
without cost or at an appraised value upon authority of the head or governing body of the agency or
corporation, and upon due accomplishment of an Invoice and Receipt of Property." Pointing out the
absence of any prohibition under R.A. No. 9136 and its IRR for PSALM to transfer the AHEPP to
another government instrumentality, and considering that MWSS is allowed under its charter to
acquire the said facility, the OGCC expressed the view that PSALM may, "in the interest of stemming
a potential water crisis, turn over the ownership, operations and management of the Angat Facility to
a qualified entity, such as the MWSS, without need of public bidding as the latter is also a
government entity."[41]

Consequently, MWSS requested the Office of the President (OP) to exclude the AHEPP from the list
of NPC assets to be privatized under the EPIRA. Said request was endorsed to the Department of
Finance (DOF) which requested the National Economic Development Authority (NEDA) to give its
comments. Meanwhile, on August 20, 2008, the OGCC issued a Clarification[42] on its Opinion No.
107, s. 2008 stating that the tenor of the latter issuance was "permissive" and "[n]ecessarily, the
disposal of the AHEPP by sale through public bidding the principal mode of disposition under x xx
R.A. 9136 remains PSALM's primary option." The OGCC further explained its position, thus:

32
If, in the exercise of PSALM's discretion, it determines that privatization by sale through public bidding
is the best mode to fulfill its mandate under R.A. 9136, and that this mode will not contravene the
State's declared policy on water resources, then the same is legally permissible.

Finally, in OGCC Opinion No. 107 s. 2008, this Office underscored "the overriding policy of the State
x x x recogniz[ing] that 'water is vital to national development x xx=' [and] the crucial role which the
Angat Facility plays in the uninterrupted and adequate supply and distribution of potable water to
residents of Metro Manila." This Office reiterates "the primacy of the State's interest in mitigating the
possible deleterious effects of an impending "water crisis" encompassing areas even beyond Metro
Manila." Any transfer of the AHEPP to be undertaken by PSALM whether to a private or public
entity must not contravene the State's declared policy of ensuring the flow of clean, potable
water under RA 6395 and 9136, and Presidential Decree 1067. Hence, said transfer and/or
privatization scheme must ensure the preservation of the AHEPP as a vital source of water for Metro
Manila and the surrounding provinces.[43] (Emphasis supplied.)

On September 16, 2009, NEDA Deputy Director General Rolando G. Tungpalan, by way of comment
to MWSS's position, wrote the DOF stating that MWSS's concern on ensuring an uninterrupted and
adequate supply of water for domestic use is amply protected and consistently addressed in the
EPIRA. Hence, NEDA concluded that there appears to be no basis to exclude AHEPP from the list of
NPC generation assets to be privatized and no compelling reason to transfer its management,
operations and control to MWSS.[44] NEDA further pointed out that:

Ownership and operation of a hydropower plant, however, goes beyond the mandate of
MWSS. To operate a power generation plant, given the sector's legislative setup would require
certification and permits that has to be secured by the operator. MWSS does not have the technical
capability to undertake the operation and maintenance of the AHEPP nor manage the contract of a
contracted private party to undertake the task for MWSS. While MWSS may tap NPC to operate and
maintain the AHEPP, this, similar to contracting out a private party, may entail additional transaction
costs, and ultimately result to higher generation rates.[45] (Emphasis supplied.)

Thereafter, MWSS sought the support of the DPWH in a letter dated September 24, 2009 addressed
to then Secretary Hermogenes E. Ebdane, Jr., for the exclusion of the AHEPP from the list of NPC
assets to be privatized and instead transfer the ownership, possession and control thereof to MWSS
with reasonable compensation. Acting on the said request, Secretary Ebdane, Jr. wrote a
memorandum for the President recommending that "the Angat Dam be excluded from the list of NPC
assets to be privatized, and that the ownership, management and control of the Dam be transferred
from NPC to MWSS, with reasonable compensation."[46]

Based on the foregoing factual backdrop, there seems to be no dispute as to the complete jurisdiction
of NPC over the government-owned Angat Dam and AHEPP.

The Angat Reservoir and Dam were constructed from 1964 to 1967 and have become operational
since 1968. They have multiple functions:

1) To provide irrigation to about 31,000 hectares of land in 20 municipalities and towns in Pampanga
and Bulacan;
2) To supply the domestic and industrial water requirements of residents in Metro Manila;
3) To generate hydroelectric power to feed the Luzon Grid; and
4) To reduce flooding to downstream towns and villages.[47]

The Angat Dam is a rockfill dam with a spillway equipped with three gates at a spilling level of 219
meters and has storage capacity of about 850 million cubic meters. Water supply to the MWSS is
released through five auxiliary turbines where it is diverted to the two tunnels going to the Ipo Dam. [48]
The Angat Dam is one of the dams under the management of NPC while the La Mesa and Ipo dams
are being managed by MWSS. MWSS is a government corporation existing by virtue of R.A. No.
6234.[49]NAPOCOR or NPC is also a government-owned corporation created under Commonwealth
Act (C.A.) No. 120,[50] which, among others, was vested with the following powers under Sec. 2,
paragraph (g):

33
(g) To construct, operate and maintain power plants, auxiliary plants, dams, reservoirs, pipes,
mains, transmission lines, power stations and substations, and other works for the purpose of
developing hydraulic power from any river, creek, lake, spring and waterfall in the Philippines
and supplying such power to the inhabitants thereof; to acquire, construct, install, maintain,
operate and improve gas, oil, or steam engines, and/or other prime movers, generators and other
machinery in plants and/or auxiliary plants for the production of electric power; to establish, develop,
operate, maintain and administer power and lighting system for the use of the Government and the
general public; to sell electric power and to fix the rates and provide for the collection of the charges
for any service rendered: Provided, That the rates of charges shall not be subject to revision by the
Public Service Commission;

x x x x (Emphasis supplied.)

On September 10, 1971, R.A. No. 6395 was enacted which revised the charter of NPC, extending its
corporate life to the year 2036. NPC thereafter continued to exercise complete jurisdiction over dams
and power plants including the Angat Dam, Angat Reservoir and AHEPP. While the NPC was
expressly granted authority to construct, operate and maintain power plants, MWSS was not vested
with similar function. Section 3 (f), (o) and (p) of R.A. No. 6234 provides that MWSS's powers and
attributes include the following

(f) To construct, maintain, and operate dams, reservoirs, conduits, aqueducts, tunnels, purification
plants, water mains, pipes, fire hydrants, pumping stations, machineries and other waterworks for the
purpose of supplying water to the inhabitants of its territory, for domestic and other purposes;
and to purify, regulate and control the use, as well as prevent the wastage of water;

xxxx

(o) To assist in the establishment, operation and maintenance of waterworks and sewerage
systems within its jurisdiction under cooperative basis;

(p) To approve and regulate the establishment and construction of waterworks and sewerage
systems in privately owned subdivisions within its jurisdiction; x xx. (Emphasis supplied.)

On December 9, 1992, by virtue of R.A. No. 7638,[51] NPC was placed under the Department of
Energy (DOE) as one of its attached agencies.

Aside from its ownership and control of the Angat Dam and AHEPP, NPC was likewise mandated to
exercise complete jurisdiction and control over its watershed, pursuant to Sec. 2 (n) and (o) of R.A.
No. 6395 for development and conservation purposes:

(n) To exercise complete jurisdiction and control over watersheds surrounding the reservoirs
of plants and/or projects constructed or proposed to be constructed by the Corporation. Upon
determination by the Corporation of the areas required for watersheds for a specific project, the
Bureau of Forestry, the Reforestation Administration and the Bureau of Lands shall, upon written
advice by the Corporation, forthwith surrender jurisdiction to the Corporation of all areas embraced
within the watersheds, subject to existing private rights, the needs of waterworks systems, and the
requirements of domestic water supply;

(o) In the prosecution and maintenance of its projects, the Corporation shall adopt measures to
prevent environmental pollution and promote the conservation, development and maximum utilization
of natural resources; and

x x x x (Emphasis supplied.)

On December 4, 1965, Presidential Proclamation No. 505 was issued amending Proclamation No. 71
by transferring the administration of the watersheds established in Montalban, San Juan del Monte,
Norzagaray, Angat, San Rafael, Peñaranda and Infanta, Provinces of Rizal, Bulacan, Nueva Ecija
and Quezon, to NPC. Subsequent executive issuances [Presidential Decree (P.D.) No. 1515 which
was signed in June 1978 and amended by P.D. No. 1749 in December 1980] led to the creation of
the NPC Watershed Management Division which presently has 11 watershed areas under its
management.[52]

34
Privatization of AHEPP Mandatory Under EPIRA

With the advent of EPIRA in 2001, PSALM came into existence for the principal purpose of managing
the orderly sale, privatization and disposition of generation assets, real estate and other disposable
assets of the NPC including IPP Contracts. Accordingly, PSALM was authorized to take title to and
possession of, those assets transferred to it. EPIRA mandated that all such assets shall be sold
through public bidding with the exception of Agus and Pulangui complexes in Mindanao, the
privatization of which was left to the discretion of PSALM in consultation with Congress, [53] thus:

Sec. 47. NPC Privatization. Except for the assets of SPUG, the generation assets, real estate, and
other disposable assets as well as IPP contracts of NPC shall be privatized in accordance with this
Act. Within six (6) months from the effectivity of this Act, the PSALM Corp. shall submit a plan for
the endorsement by the Joint Congressional Power Commission and the approval of the President of
the Philippines, on the total privatization of the generation assets, x x x of NPC and thereafter,
implement the same, in accordance with the following guidelines, except as provided for in
[p]aragraph (f) herein:

xxxx

(d) All assets of NPC shall be sold in an open and transparent manner through public bidding, x x x;

xxxx

(f) The Agus and the Pulangui complexes in Mindanao shall be excluded from among the generation
companies that will be initially privatized. Their ownership shall be transferred to the PSALM Corp.
and both shall continue to be operated by the NPC. Said complexes may be privatized not earlier
than ten (10) years from the effectivity of this Act, x xx.The privatization of Agus and Pulangui
complexes shall be left to the discretion of PSALM Corp. in consultation with Congress;

x x x x (Emphasis supplied.)

The intent of Congress not to exclude the AHEPP from the privatization of NPC generation assets is
evident from the express provision exempting only the aforesaid two power plants in Mindanao. Had
the legislature intended that PSALM should likewise be allowed discretion in case of NPC generation
assets other than those mentioned in Sec. 47, it could have explicitly provided for the same. But the
EPIRA exempted from privatization only those two plants in Mindanao and the Small Power Utilities
Group (SPUG).[54] Expressio unius est exclusio alterius, the express inclusion of one implies the
exclusion of all others.[55]

It is a settled rule of statutory construction that the express mention of one person, thing, or
consequence implies the exclusion of all others. The rule is expressed in the familiar
maxim, expressio unius est exclusio alterius.

The rule of expressio unius est exclusio alterius is formulated in a number of ways. One variation of
the rule is principle that what is expressed puts an end to that which is implied. Expressium facit
cessare tacitum. Thus, where a statute, by its terms, is expressly limited to certain matters, it may not,
by interpretation or construction, be extended to other matters.

xxxx

The rule of expressio unius est exclusio alterius and its variations are canons of restrictive
interpretation. They are based on the rules of logic and the natural workings of the human mind. They
are predicated upon one's own voluntary act and not upon that of others. They proceed from the
premise that the legislature would not have made specified enumeration in a statute had the intention
been not to restrict its meaning and confine its terms to those expressly mentioned. [56]

The Court therefore cannot sustain the position of petitioners, adopted by respondent MWSS, that
PSALM should have exercised the discretion not to proceed with the privatization of AHEPP, or at
least the availability of the option to transfer the said facility to another government entity such as
MWSS. Having no such discretion in the first place, PSALM committed no grave abuse of discretion
when it commenced the sale process of AHEPP pursuant to the EPIRA.

35
In any case, the Court finds that the operation and maintenance of a hydroelectric power plant is not
among the statutorily granted powers of MWSS. Although MWSS was granted authority to construct
and operate dams and reservoirs, such was for the specific purpose of supplying water for domestic
and other uses, and the treatment, regulation and control of water usage, and not power generation.
[57]
Moreover, since the sale of AHEPP by PSALM merely implements the legislated reforms for the
electric power industry through schemes that aim "[t]o enhance the inflow of private capital and
broaden the ownership base of the power generation, transmission and distribution sectors," [58] the
proposed transfer to MWSS which is another government entity contravenes that State policy. COA
Circular No. 89-296 likewise has no application to NPC generating assets which are still serviceable
and definitely needed by the Government for the purpose of liquidating NPC's accumulated debts
amounting to billions in US Dollars. Said administrative circular cannot prevail over the EPIRA, a
special law governing the disposition of government properties under the jurisdiction of the DOE
through NPC.

Sale of Government-Owned AHEPP

to a Foreign Corporation Not Prohibited
But Only Filipino Citizens and Corporations
60% of whose capital is owned by Filipinos
May be Granted Water Rights

The core issue concerns the legal implications of the acquisition by K-Water of the AHEPP in relation
to the constitutional policy on our natural resources.

Sec. 2, Art. XII of the 1987 Constitution provides in part:

SEC.2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all
forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural
resources are owned by the State. With the exception of agricultural lands, all other natural
resources shall not be alienated. The exploration, development, and utilization of natural
resources shall be under the full control and supervision of the State. The State may directly
undertake such activities, or it may enter into co-production, joint venture, or production-sharing
agreements with Filipino citizens, or corporations or associations at least sixty per centum of whose
capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five
years, renewable for not more than twenty-five years, and under such terms and conditions as may
be provided by law. In case of water rights for irrigation, water supply, fisheries, or industrial uses
other than the development of water power, beneficial use may be the measure and limit of the grant.

x x x x (Emphasis supplied.)

The State's policy on the management of water resources is implemented through the regulation of
water rights. Presidential Decree No. 1067, otherwise known as "The Water Code of the Philippines"
is the basic law governing the ownership, appropriation utilization, exploitation, development,
conservation and protection of water resources and rights to land related thereto. The National Water
Resources Council (NWRC) was created in 1974 under P.D. No. 424 and was subsequently renamed
as National Water Resources Board (NWRB) pursuant to Executive Order No. 124-A. [59] The NWRB
is the chief coordinating and regulating agency for all water resources management development
activities which is tasked with the formulation and development of policies on water utilization and
appropriation, the control and supervision of water utilities and franchises, and the regulation and
rationalization of water rates.[60]

The pertinent provisions of Art. 3, P.D. No. 1067 provide:

Art. 3. The underlying principles of this code are:

a. All waters belong to the State.

b. All waters that belong to the State can not be the subject to acquisitive prescription.
c. The State may allow the use or development of waters by administrative concession.
d. The utilization, exploitation, development, conservation and protection of water resources shall
be subject to the control and regulation of the government through the National Water
Resources Council x x x

36
 e. Preference in the use and development of waters shall consider current usages and be
responsive to the changing needs of the country.

xxxx

Art. 9. Waters may be appropriated and used in accordance with the provisions of this Code.

Appropriation of water, as used in this Code, is the acquisition of rights over the use of waters or
the taking or diverting of waters from a natural source in the manner and for any purpose allowed
by law.

Art. 10. Water may be appropriated for the following purposes:

xxxx

(d) Power generation

xxxx

Art. 13. Except as otherwise herein provided, no person including government instrumentalities or
government-owned or controlled corporations, shall appropriate water without a water right, which
shall be evidenced by a document known as a water permit.

Water right is the privilege granted by the government to appropriate and use water.

xxxx

Art. 15. Only citizens of the Philippines, of legal age, as well as juridical persons, who are duly
qualified by law to exploit and develop water resources, may apply for water permits.
(Emphasis supplied.)

It is clear that the law limits the grant of water rights only to Filipino citizens and juridical entities duly
qualified by law to exploit and develop water resources, including private corporations with sixty
percentof their capital owned by Filipinos. In the case of Angat River, the NWRB has issued separate
water permits to MWSS, NPC and NIA.[61]

Under the EPIRA, the generation of electric power, a business affected with public interest, was
opened to private sector and any new generation company is required to secure a certificate of
compliance from the Energy Regulatory Commission (ERC), as well as health, safety and
environmental clearances from the concerned government agencies. Power generation shall not be
considered a public utility operation,[62] and hence no franchise is necessary. Foreign investors are
likewise allowed entry into the electric power industry. However, there is no mention of water rights in
the privatization of multi-purpose hydropower facilities. Section 47 (e) addressed the issue of water
security, as follows:

(e) In cases of transfer of possession, control, operation or privatization of multi-purpose hydro

facilities, safeguards shall be prescribed to ensure that the national government may direct water
usagein cases of shortage to protect potable water, irrigation, and all other requirements
imbued with public interest;

x x x x (Emphasis supplied.)

This provision is consistent with the priority accorded to domestic and municipal uses of
water[63] under the Water Code, thus:

Art. 22. Between two or more appropriators of water from the same sources of supply, priority in time
of appropriation shall give the better right, except that in times of emergency the use of water for
domestic and municipal purposes shall have a better right over all other uses; Provided, That,
where water shortage is recurrent and the appropriator for municipal use has a lower priority in time
of appropriation, then it shall be his duty to find an alternative source of supply in accordance with
conditions prescribed by the [Board]. (Emphasis supplied.)

37
Rule 23, Section 6 of the Implementing Rules and Regulations (IRR) of the EPIRA provided for the
structure of appropriation of water resources in multi-purpose hydropower plants which will undergo
privatization, as follows:

Section 6. Privatization of Hydroelectric Generation Plants.

(a) Consistent with Section 47(e) of the Act and Section 4(f) of this Rule,the Privatization of hydro
facilities of NPC shall cover the powercomponent including assignable long-term water rights
agreements for the use of water, which shall be passed onto and respected by the buyers of
the hydroelectric power plants.

(b) The National Water Resources Board (NWRB) shall ensure that the allocation for irrigation, as
indicated by the NIA and requirements for domestic water supply as provided for by the
appropriate Local WaterDistrict(s) are recognized and provided for in the water rights
agreements. NPC or PSALM may also impose additional conditions inthe shareholding agreement
with the winning bidders to ensurenational security, including, but not limited to, the use of
waterduring drought or calamity.

(c) Consistent with Section 34(d) of the Act, the NPC shall continue to be responsible for
watershed rehabilitation and management and shallbe entitled to the environmental charge
equivalent to one-fourth ofone centavo per kilowatt-hour sales (P0.0025/kWh), which shall formpart of
the Universal Charge. This environmental fund shall be usedsolely for watershed rehabilitation and
management and shall bemanaged by NPC under existing arrangements. NPC shall submit anannual
report to the DOE detailing the progress of the watershedrehabilitation program.

(d) The NPC and PSALM or NIA, as the case may be, shall continue to be responsible for the
dam structure and all other appurtenant structures necessary for the safe and reliable
operation of the hydropower plants. The NPC and PSALM or NIA, as the case may be,shall enter
into an operations and maintenance agreement with theprivate operator of the power plant to cover
the dam structure and allother appurtenant facilities. (Emphasis supplied.)

In accordance with the foregoing implementing regulations, and in furtherance of the Asset Purchase
Agreement[64] (APA), PSALM, NPC and K-Water executed on April 28, 2010 an Operations and
Maintenance Agreement[65] (O & M Agreement) for the administration, rehabilitation, operation,
preservation and maintenance, by K-Water as the eventual owner of the AHEPP, of the Non-Power
Components meaning the Angat Dam, non-power equipment, facilities, installations, and appurtenant
devices and structures, including the water sourced from the Angat Reservoir.

It is the position of PSALM that as the new owner only of the hydroelectric power plant, K-Water will
be a mere operator of the Angat Dam. In the power generation activity, K-Water will have to utilize
the waters already extracted from the river and impounded on the dam. This process of generating
electric power from the dam water entering the power plant thus does not constitute appropriation
within the meaning of natural resource utilization in the Constitution and the Water Code.

The operation of a typical hydroelectric power plant has been described as follows:

Hydroelectric energy is produced by the force of falling water. The capacity to produce this energy is
dependent on both the available flow and the height from which it falls. Building up behind a high
dam, water accumulates potential energy. This is transformed into mechanical energy when the water
rushes down the sluice and strikes the rotary blades of turbine. The turbine's rotation spins
electromagnets which generate current in stationary coils of wire. Finally, the current is put through a
transformer where the voltage is increased for long distance transmission over power lines. [66]

Foreign ownership of a hydropower facility is not prohibited under existing laws. The construction,
rehabilitation and development of hydropower plants are among those infrastructure projects which
even wholly-owned foreign corporations are allowed to undertake under the Amended Build-Operate-
Transfer (Amended BOT) Law (R.A. No. 7718).[67] Beginning 1987, the policy has been openness to
foreign investments as evident in the fiscal incentives provided for the restructuring and privatization
of the power industry in the Philippines, under the Power Sector Restructuring Program (PSRP) of the
Asian Development Bank.

38
The establishment of institutional and legal framework for the entry of private sector in the power
industry began with the issuance by President Corazon C. Aquino of Executive Order No. 215 in
1987. Said order allowed the entry of private sector the IPPs to participate in the power generation
activities in the country. The entry of IPPs was facilitated and made attractive through the first BOT
Law in 1990 (R.A. No. 6957) which aimed to "minimize the burden of infrastructure projects on the
national government budget, minimize external borrowing for infrastructure projects, and use the
efficiency of the private sector in delivering a public good." In 1993, the Electric Power Crisis Act was
passed giving the President emergency powers to urgently address the power crisis in the country. [68]
The full implementation of the restructuring and privatization of the power industry was achieved
when Congress passed the EPIRA in 2001.

With respect to foreign investors, the nationality issue had been framed in terms of the character or
nature of the power generation process itself, i.e., whether the activity amounts to utilization of natural
resources within the meaning of Sec. 2, Art. XII of the Constitution. If so, then foreign companies
cannot engage in hydropower generation business; but if not, then government may legally allow
even foreign-owned companies to operate hydropower facilities.

The DOJ has consistently regarded hydropower generation by foreign entities as not constitutionally
proscribed based on the definition of water appropriation under the Water Code, thus:

Opinion No. 173, 1984

This refers to your request for opinion on the possibility of granting water permits to foreign
corporations authorized to do business in the Philippines x xx

xxxx

x x x while the Water Code imposes a nationality requirement for the grant of water permits, the same
refers to the privilege "to appropriate and use water." This should be interpreted to mean the
extraction of water from its natural source (Art. 9, P.D. No. 1067). Once removed therefrom, they
cease to be a part of the natural resources of the country and are the subject of ordinary
commerce and may be acquired by foreigners (Op. No. 55, series of 1939). x x x in case of a
contract of lease, the water permit shall be secured by the lessor and included in the lease as an
improvement. The water so removed from the natural source may be appropriated/used by the
foreign corporation leasing the property.

Opinion No. 14, S. 1995

The nationality requirement imposed by the Water Code refers to the privilege "to appropriate and
use water." This, we have consistently interpreted to mean the extraction of water directly from its
natural source. Once removed from its natural source the water ceases to be a part of the natural
resources of the country and may be subject of ordinary commerce and may even be acquired by
foreigners. (Secretary of Justice Op. No. 173, s. 1984; No. 24, s. 1989; No. 100 s. 1994)

In fine, we reiterate our earlier view that a foreign entity may legally process or treat water after
its removal from a natural source by a qualified person, natural or juridical.

Opinion No. 122, s. 1998

The crucial issue at hand is the determination of whether the utilization of water by the power plant to
be owned and operated by a foreign-owned corporation (SRPC) will violate the provisions of the
Water Code.

As proposed, the participation of SRPC to the arrangement commences upon construction of the
power station, consisting of a dam and a power plant. After the completion of the said station, its
ownership and control shall be turned over to NPC. However, SRPC shall remain the owner of the
power plant and shall operate it for a period of twenty-five (25) years.

It appears that the dam, which will be owned and controlled by NPC, will block the natural flow of the
river,. The power plant, which is situated next to it, will entirely depend upon the dam for its water
supply which will pass through an intake gate situated one hundred (100) meters above the riverbed.
Due to the distance from the riverbed, water could not enter the power plant absent the dam that
traps the flow of the river. It appears further that no water shall enter the power tunnel without
specific dispatch instructions from NPC, and such supplied water shall be used only by SRPC for

39
power generation and not for any other purpose. When electricity is generated therein, the same
shall be supplied to NPC for distribution to the public. These facts x xx viewed in relation to the Water
Code, specifically Article 9 thereof, x x x

clearly show that there is no circumvention of the law.

This Department has declared that the nationality requirement imposed by the Water Code refers to
the privilege "to appropriate and use water" and has interpreted this phrase to mean the extraction of
water directly from its natural source (Secretary of Justice Opinion No. 14, s. 1995). "Natural" is
defined as that which is produced without aid of stop, valves, slides, or other supplementary means
(see Webster's New International Dictionary, Second Edition, p. 1630). The water that is used by
the power plant could not enter the intake gate without the dam, which is a man-made
structure. Such being the case, the source of the water that enters the power plant is of
artificial character rather than natural. This Department is consistent in ruling, that once water is
removed from its natural source, it ceases to be a part of the natural resources of the country and
may be the subject of ordinary commerce and may even be acquired by foreigners. (Ibid., No. 173, s.
1984; No. 24, s. 1989; No. 100, s. 1994).

It is also significant to note that NPC, a government-owned and controlled corporation, has
the effective control over all elements of the extraction process, including the amount and
timing thereof considering that x xx the water will flow out of the power tunnel and through the power
plant, to be used for the generation of electricity, only when the Downstream Gates are opened,
which occur only upon the specific water release instructions given by NPC to SRPC. This specific
feature of the agreement, taken together with the above-stated analysis of the source of water that
enters the plant, support the view that the nationality requirement embodied in Article XII, Section 2 of
the present Constitution and in Article 15 of the Water Code, is not violated. [69] (Emphasis supplied.)

The latest executive interpretation is stated in DOJ Opinion No. 52, s. 2005 which was rendered upon
the request of PSALM in connection with the proposed sale structure for the privatization of
hydroelectric and geothermal generation assets (Gencos) of NPC. PSALM sought a ruling on the
legality of its proposed privatization scheme whereby the non-power components (dam, reservoir and
appurtenant structures and watershed area) shall be owned by the State through government entities
like NPC or NIA which shall exercise control over the release of water, while the ownership of the
power components (power plant and related facilities) is open to both Filipino citizens/corporations
and 100% foreign-owned corporations.

Sustaining the position of PSALM, then Secretary Raul M. Gonzalez opined:

Premised on the condition that only the power components shall be transferred to the foreign bidders
while the non-power components/structures shall be retained by state agencies concerned, we find
that both PSALM's proposal and position are tenable.

xxxx

x x x as ruled in one case by a U.S. court:

Where the State of New York took its natural resources consisting of Saratoga Spring and, through a
bottling process, put those resources into preserved condition where they could be sold to the public
in competition with private waters, the state agencies were not immune from federal taxes imposed
upon bottled waters on the theory that state was engaged in the sale of "natural resources."

Applied to the instant case, and construed in relation to the earlier-mentioned constitutional inhibition,
it would appear clear that while both waters and geothermal steam are, undoubtedly "natural
resources", within the meaning of Section 2 Article XII of the present Constitution, hence, their
exploitation, development and utilization should be limited to Filipino citizens or corporations or
associations at least sixty per centum of the capital of which is owned by Filipino citizens, the
utilization thereof can be opened even to foreign nationals, after the same have been extracted
from the source by qualified persons or entities. The rationale is because, since they no longer
form part of the natural resources of the country, they become subject to ordinary commerce.

A contrary interpretation, i.e., that the removed or extracted natural resources would remain
inalienable especially to foreign nationals, can lead to absurd consequences, e.g. that said waters
and geothermal steam, and any other extracted natural resources, cannot be acquired by foreign

40
nationals for sale within or outside the country, which could not [have] been intended by the framers
of the Constitution.

The fact that under the proposal, the non-power components and structures shall be retained
and maintained by the government entities concerned is, to us, not only a sufficient compliance
of constitutional requirement of "full control and supervision of the State" in the exploitation,
development and utilization of natural resources. It is also an enough safeguard against the evil
sought to be avoided by the constitutional reservation x x x.[70] (Italics in the original, emphasis
supplied.)

Appropriation of water, as used in the Water Code refers to the "acquisition of rights over the use of
waters or the taking or diverting of waters from a natural source in the manner and for any purpose
allowed by law."[71] This definition is not as broad as the concept of appropriation of water in
American jurisprudence:

An appropriation of water flowing on the public domain consists in the capture, impounding, or
diversion of it from its natural course or channel and its actual application to some beneficial
use private or personal to the appropriator, to the entire exclusion (or exclusion to the extent of the
water appropriated) of all other persons. x xx[72]

On the other hand, "water right" is defined in the Water Code as the privilege granted by the
government to appropriate and use water.[73] Black's Law Dictionary defined "water rights" as "[a] legal
right, in the nature of a corporeal hereditament, to use the water of a natural stream or water
furnished through a ditch or canal, for general or specific purposes, such as irrigation, mining, power,
or domestic use, either to its full capacity or to a measured extent or during a defined portion of the
time," or "the right to have the water flow so that some portion of it may be reduced to possession and
be made private property of individual, and it is therefore the right to divert water from natural stream
by artificial means and apply the same to beneficial use."[74]

Under the Water Code concept of appropriation, a foreign company may not be said to be
"appropriating" our natural resources if it utilizes the waters collected in the dam and converts the
same into electricity through artificial devices. Since the NPC remains in control of the operation of
the dam by virtue of water rights granted to it, as determined under DOJ Opinion No. 122, s. 1998,
there is no legal impediment to foreign-owned companies undertaking the generation of electric
power using waters already appropriated by NPC, the holder of water permit. Such was the situation
of hydropower projects under the BOT contractual arrangements whereby foreign investors are
allowed to finance or undertake construction and rehabilitation of infrastructure projects and/or own
and operate the facility constructed. However, in case the facility requires a public utility franchise,
the facility operator must be a Filipino corporation or at least 60% owned by Filipino. [75]

With the advent of privatization of the electric power industry which resulted in its segregation into
four sectors -- generation, transmission, distribution and supply NPC's generation and transmission
functions were unbundled. Power generation and transmission were treated as separate sectors
governed by distinct rules under the new regulatory framework introduced by EPIRA. The National
Transmission Corporation (TRANSCO) was created to own and operate the transmission assets and
perform the transmission functions previously under NPC. While the NPC continues to undertake
missionary electrification programs through the SPUG, PSALM was also created to liquidate the
assets and liabilities of NPC.

Under the EPIRA, NPC's generation function was restricted as it was allowed to "generate and sell
electricity only from the undisposed generating assets and IPP contracts of PSALM" and was
prohibited from incurring "any new obligations to purchase power through bilateral contracts with
generation companies or other suppliers."[76] PSALM, on the other hand, was tasked "[t]o structure
the sale, privatization or disposition of NPC assets and IPP contracts and/or their energy output
based on such terms and conditions which shall optimize the value and sale prices of said assets." [77]
In the case of multi-purpose hydropower plants, the IRR of R.A. No. 9136 provided that their
privatization would extend to water rights which shall be transferred or assigned to the buyers thereof,
subject to safeguards mandated by Sec. 47(e) to enable the national government to direct water
usage in cases of shortage to protect water requirements imbued with public interest.

Accordingly, the Asset Purchase Agreement executed between PSALM and K-Water stipulated:

41
2.04 Matters Relating to the Non-Power Component

xxxx

Matters relating to Water Rights

NPC has issued a certification (the "Water Certification") wherein NPC consents, subject to Philippine
Law, to the (i) transfer of the Water Permit to the BUYER or its Affiliate, and (ii) use by the
BUYER or its Affiliate of the water covered by the Water Permit from Closing Date up to a
maximum period of one (1) year thereafter to enable the BUYER to appropriate and use water
sourced from Angat reservoir for purposes of power generation; provided, that should the
consent or approval of any Governmental Body be required for either (i) or (ii), the BUYER must
secure such consent or approval. The BUYER agrees and shall fully comply with the Water Permit
and the Water Certification. x xx

xxxx

Multi-Purpose Facility

The BUYER is fully aware that the Non-Power Components is a multi-purpose hydro-facility and the
water is currently being appropriated for domestic use, municipal use, irrigation and power
generation. Anything in this Agreement notwithstanding, the BUYER shall, at all times even after the
Payment Date, fully and faithfully comply with Philippine Law, including the Instructions, the Rule
Curve and Operating Guidelines and the Water Protocol.[78] (Emphasis supplied.)

Lease or transfer of water rights is allowed under the Water Code, subject to the approval of NWRB
after due notice and hearing.[79] However, lessees or transferees of such water rights must comply
with the citizenship requirement imposed by the Water Code and its IRR. But regardless of such
qualification of water permit holders/transferees, it is to be noted that there is no provision in the
EPIRA itself authorizing the NPC to assign or transfer its water rights in case of transfer of operation
and possession of multi-purpose hydropower facilities. Since only the power plant is to be sold and
privatized, the operation of the non-power components such as the dam and reservoir, including the
maintenance of the surrounding watershed, should remain under the jurisdiction and control of NPC
which continue to be a government corporation. There is therefore no necessity for NPC to transfer
its permit over the water rights to K-Water. Pursuant to its purchase and operation/management
contracts with K-Water, NPC may authorize the latter to use water in the dam to generate electricity.

NPC's water rights remain an integral aspect of its jurisdiction and control over the dam and
reservoir. That the EPIRA itself did not ordain any transfer of water rights leads us to infer that
Congress intended NPC to continue exercising full supervision over the dam, reservoir and, more
importantly, to remain in complete control of the extraction or diversion of water from the Angat River.
Indeed, there can be no debate that the best means of ensuring that PSALM/NPC can fulfill the duty
to prescribe "safeguards to enable the national government to direct water usage to protect potable
water, irrigation, and all other requirements imbued with public interest" is for it to retain the water
rights over those water resources from where the dam waters are extracted. In this way, the State's
full supervision and control over the country's water resources is also assured notwithstanding the
privatized power generation business.

Section 6 (a) of the IRR of R.A. No. 9136 insofar as it directs the transfer of water rights in the
privatization of multi-purpose hydropower facilities, is thus merely directory.

It is worth mentioning that the Water Code explicitly provides that Filipino citizens and juridical
persons who may apply for water permits should be "duly qualified by law to exploit and develop
water resources." Thus, aside from the grant of authority to construct and operate dams and power
plants, NPC's Revised Charter specifically authorized it

(f) To take water from any public stream, river, creek, lake, spring or waterfall in the Philippines, for
the purposes specified in this Act; to intercept and divert the flow of waters from lands of riparian
owners and from persons owning or interested in waters which are or may be necessary for said
purposes, upon payment of just compensation therefor; to alter, straighten, obstruct or increase the
flow of water in streams or water channels intersecting or connecting therewith or contiguous to its
works or any part thereof: Provided, That just compensation shall be paid to any person or persons
whose property is, directly or indirectly, adversely affected or damaged thereby.[80]

42
The MWSS is likewise vested with the power to construct, maintain and operate dams and reservoirs
for the purpose of supplying water for domestic and other purposes, as well to construct, develop,
maintain and operate such artesian wells and springs as may be needed in its operation within its
territory.[81] On the other hand, NIA, also a water permit holder in Angat River, is vested with similar
authority to utilize water resources, as follows:

(b) To investigate all available and possible water resources in the country for the purpose of utilizing
the same for irrigation, and to plan, design and construct the necessary projects to make the ten to
twenty-year period following the approval of this Act as the Irrigation Age of the Republic of the
Philippines;[82]

(c) To construct multiple-purpose water resources projects designed primarily for irrigation, and
secondarily for hydraulic power development and/or other uses such as flood control, drainage, land
reclamation, domestic water supply, roads and highway construction and reforestation, among others,
provided, that the plans, designs and the construction thereof, shall be undertaken in coordination
with the agencies concerned;[83]

To reiterate, there is nothing in the EPIRAwhich declares that it is mandatory forPSALM or NPC to
transfer or assign NPC's water rights to buyers of its multi-purpose hydropower facilities as part of the
privatization process. While PSALM was mandated to transfer the ownership of all hydropower
plants except those mentioned in Sec. 47 (f), any transfer of possession, operation and control of the
multi-purpose hydropower facilities, the intent to preserve water resources under the full supervision
and control of the State is evident when PSALM was obligated to prescribe safeguards to enable the
national government to direct water usage to domestic and other requirements "imbued with public
interest." There is no express requirement for the transfer of water rights in all cases where the
operation of hydropower facilities in a multi-purpose dam complex is turned over to the private sector.

As the new owner of the AHEPP, K-Water will have to utilize the waters in the Angat Dam for
hydropower generation. Consistent with the goals of the EPIRA, private entities are allowed to
undertake power generation activities and acquire NPC's generation assets. But since only the
hydroelectric power plants and appurtenances are being sold, the privatization scheme should enable
the buyer of a hydroelectric power plant in NPC's multi-purpose dam complex to have beneficialuse of
the waters diverted or collected in the Angat Dam for its hydropower generation activities, and at the
same time ensure that the NPC retains full supervision and control over the extraction and diversion
of waters from the Angat River.

In fine, the Court rules that while the sale of AHEPP to a foreign corporation pursuant to the
privatization mandated by the EPIRA did not violate Sec. 2, Art. XII of the 1987 Constitution which
limits the exploration, development and utilization of natural resources under the full supervision and
control of the State or the State's undertaking the same through joint venture, co-production or
production sharing agreements with Filipino corporations 60% of the capital of which is owned by
Filipino citizens, the stipulation in the Asset Purchase Agreement and Operations and Maintenance
Agreement whereby NPC consents to the transfer of water rights to the foreign buyer, K-Water,
contravenes the aforesaid constitutional provision and the Water Code.

Section 6, Rule 23 of the IRR of EPIRA, insofar as it ordered NPC's water rights in multi-purpose
hydropower facilities to be included in the sale thereof, is declared as merely directoryand not an
absolute condition in the privatization scheme. In this case, we hold that NPC shall continue to be the
holder of the water permit even as the operational control and day-to-day management of the AHEPP
is turned over to K-Water under the terms and conditions of their APA and O & M Agreement,
whereby NPC grants authority to K-Water to utilize the waters diverted or collected in the Angat Dam
for hydropower generation. Further, NPC and K-Water shall faithfully comply with the terms and
conditions of the Memorandum of Agreement on Water Protocol, as well as with such other
regulations and issuances of the NWRB governing water rights and water usage.

WHEREFORE, the present petition for certiorari and prohibition with prayer for injunctive relief/s
is PARTLY GRANTED.

The following DISPOSITIONS are in ORDER:

1) The bidding conducted and the Notice of Award issued by PSALM in favor of the winning bidder,
KOREA WATER RESOURCES CORPORATION (K-WATER), are declared VALID and LEGAL;

43
2) PSALM is directed to FURNISH the petitioners with copies of all documents and records in its files
pertaining to K-Water;

3) Section 6 (a), Rule 23, IRR of the EPIRA, is hereby declared as merely DIRECTORY, and not an
absolute condition in all cases where NPC-owned hydropower generation facilities are privatized;

4) NPC shall CONTINUE to be the HOLDER of Water Permit No. 6512 issued by the National Water
Resources Board. NPC shall authorize K-Water to utilize the waters in the Angat Dam for
hydropower generation, subject to the NWRB's rules and regulations governing water right and
usage. The Asset Purchase Agreement and Operation & Management Agreement between
NPC/PSALM and K-Water are thus amended accordingly.

Except for the requirement of securing a water permit, K-Water remains BOUND by its undertakings
and warranties under the APA and O & M Agreement;

5) NPC shall be a CO-PARTY with K-Water in the Water Protocol Agreement with MWSS and NIA,
and not merely as a conforming authority or agency; and

6) The Status Quo Ante Order issued by this Court on May 24, 2010 is hereby LIFTED and SET
ASIDE.

No pronouncement as to costs.

SO ORDERED.

Sereno, C.J., Carpio, Leonardo-De Castro, Brion, Peralta, Bersamin, Del Castillo, Abad, Perez,
Mendoza, Reyes, and Perlas-Bernabe, JJ., concur.
Velasco, Jr., J., please see dissenting opinion

44
JAMES M. IMBONG v. PAQUITO N. OCHOA, GR No. 204819, 2014-04-08
Facts:
Freedom of religion was accorded preferred status by the framers of our fundamental law. And this
Court has consistently affirmed this preferred status, well aware that it is "designed to protect the
broadest possible liberty of conscience, to allow each man to... believe as his conscience directs, to
profess his beliefs, and to live as he believes he ought to live, consistent with the liberty of others and
with the common good."[1
GROUNDS:
The RH Law violates the right to life of the unborn. According to the petitioners, notwithstanding its
declared policy against abortion, the implementation of the RH Law would authorize the purchase of
hormonal contraceptives, intra-uterine devices and... injectables which are abortives, in violation of
Section 12, Article II of the Constitution which guarantees protection of both the life of the mother and
the life of the unborn from conception
The RH Law violates the right to health and the right to protection against hazardous products. The
petitioners posit that the RH Law provides universal access to contraceptives which are hazardous to
one's health, as it causes cancer and other... health problems
The RH Law violates the right to religious freedom. The petitioners contend that the RH Law violates
the constitutional guarantee respecting religion as it authorizes the use of public funds for the
procurement of contraceptives. For the petitioners, the use of... public funds for purposes that are
believed to be contrary to their beliefs is included in the constitutional mandate ensuring religious
freedom... they argue that the RH Law fails to satisfy the "clear and present danger test" and the
"compelling state interest test" to justify the regulation of the right to free exercise... of religion and the
right to free speech
The RH Law violates the constitutional provision on involuntary servitude.
the RH Law subjects medical practitioners to involuntary servitude because, to be accredited under
the PhilHealth program, they are compelled to... provide forty-eight (48) hours of pro bono services
for indigent women, under threat of criminal prosecution, imprisonment and other forms of
punishment
The RH Law violates the right to equal protection of the law. It is claimed that the RH Law
discriminates against the poor as it makes them the primary target of the government program that
promotes contraceptive use
The RH Law is "void-for-vagueness" in violation of the due process clause of the Constitution.
It is claimed that, by giving absolute authority to the person who will undergo reproductive health
procedure, the RH Law forsakes any real dialogue between the spouses and impedes the right of
spouses to mutually decide on matters pertaining to the overall well-being of their... family. In the
same breath, it is also claimed that the parents of a child who has suffered a miscarriage are deprived
of parental authority to determine whether their child should use contraceptives.
Issues:
Whether the Court may exercise its power of judicial review over the controversy.
Whether the RH law is unconstitutional:
Ruling:
Actual Case or Controversy
In this case, the Court is of the view that an actual case or controversy exists and that the same is
ripe for judicial determination. Considering that the RH Law and its implementing rules have already
taken effect and that budgetary measures to carry out the law have... already been passed, it is
evident that the subject petitions present a justiciable controversy.
Moreover, the petitioners have shown that the case is so because medical practitioners or medical
providers are in danger of being criminally prosecuted under the RH Law for vague violations thereof,
particularly public health officers who are threatened to be dismissed from... the service with forfeiture
of retirement and other benefits. They must, at least, be heard on the matter NOW.
Locus Standi
After all, the RH Law drastically affects the constitutional provisions on the right to life and... health,
the freedom of religion and expression and other constitutional rights.

45
the Court entertains no... doubt that the petitions raise issues of transcendental importance
warranting immediate court adjudication.
the Court need not wait for a life to be taken... away before taking action.
The Court, thus, agrees with the petitioners' contention that the whole idea of contraception pervades
the entire RH Law. It is, in fact, the central idea of the RH Law.[126] Indeed, remove the provisions
that refer to contraception or are related to it and... the RH Law loses its very foundation
In this case, a textual analysis of the various provisions of the law shows that both "reproductive
health" and "responsible parenthood" are interrelated and germane to the overriding objective to
control the population growth.
It is a universally accepted principle that every human being enjoys the right to life.[137] Even if not
formally established, the right to life, being grounded on natural law, is inherent and, therefore, not a
creation of, or dependent upon a particular... law, custom, or belief. It precedes and transcends any
authority or the laws of men.
Article III of the Constitution provides:
Section 1. No person shall be deprived of life, liberty, or property without due process of law, nor shall
any person be denied the equal protection of the laws
The RH Law and Abortion
The clear and unequivocal intent of the Framers of the 1987 Constitution in protecting the life of the
unborn from conception was to prevent the Legislature from enacting a measure legalizing abortion.
A reading of the RH Law would show that it is in line with this intent and actually proscribes abortion.
While the Court has opted not to make any determination, at this stage, when life begins, it finds that
the RH Law itself clearly mandates that protection be afforded from... the moment of fertilization.
Moreover, the RH Law recognizes that abortion is a crime under Article 256 of the Revised Penal
Code, which penalizes the destruction or expulsion of the fertilized ovum.
the RH Law is consistent in prohibiting abortifacients... the Court finds that the RH Law, consistent
with the Constitution, recognizes that the fertilized ovum already has life and that the State has a
bounden duty to protect it
2-The Right to Health
Thus, the Court agrees with the... observation of respondent Lagman that the effectivity of the RH
Law will not lead to the unmitigated proliferation of contraceptives since the sale, distribution and
dispensation of contraceptive drugs and devices will still require the prescription of a licensed
physician.
With
R.A. No. 4729 in place, there exists adequate safeguards to ensure the public that only
contraceptives that are safe are made available to the public.
In general, the Court does not find the RH Law as unconstitutional insofar as it seeks to provide
access to medically-safe, non-abortifacient, effective, legal, affordable, and quality reproductive
healthcare services, methods, devices, and supplies.
As healthful as the intention of the RH Law may be, the idea does not escape the Court that what it
seeks to address is the problem of rising poverty and unemployment in the country.
Be that as it may, it bears reiterating that the RH Law is a mere compilation and enhancement of the
prior existing contraceptive and reproductive health laws, but with coercive measures.
Accordingly, the Court declares R.A. No. 10354 as NOT UNCONSTITUTIONAL except with respect
to the following provisions which are declared UNCONSTITUTIONAL:
Principles:
a facial challenge, also known as a First Amendment Challenge, is one that is launched to assail the
validity of statutes concerning not only protected speech, but also all other rights in the First
Amendment.
the traditional meaning of the word "conception" which, as described and defined by all reliable and
reputable sources, means that life begins at fertilization.

46
Life is not synonymous with civil personality. One need not acquire civil personality first before he/she
could die. Even a child inside the womb already has life. No less than the Constitution recognizes the
life of the unborn from conception, that the
State must protect equally with the life of the mother.

47
ABS-CBN BROADCASTING CORPORATION v. COMELEC, GR No. 133486, 2000-01-28
Facts:
The Resolution was issued by the Comelec allegedly upon "information from [a] reliable source that
ABS-CBN (Lopez Group) has prepared a project, with PR groups, to conduct radio-TV coverage of
the elections x x x and to make [an] exit survey of the x x x vote during the... elections for national
officials particularly for President and Vice President, results of which shall be [broadcast]
immediately."
The electoral body believed that such project might conflict with the official Comelec count, as well as
the unofficial... quick count of the National Movement for Free Elections (Namfrel). It also noted that it
had not authorized or deputized Petitioner ABS-CBN to undertake the exit survey.
Issues:
"Whether or not the Respondent Commission acted with grave abuse of discretion amounting to a
lack or excess of jurisdiction when it approved the issuance of a restraining order enjoining the
petitioner or any [other group], its agents or... representatives from conducting exit polls during the x x
x May 11 elections."
Ruling:
The solicitor general contends that the petition is moot and academic, because the May 11, 1998
election has already been held and done with. Allegedly, there is no longer any actual controversy
before us.
The issue is not totally moot. While the assailed Resolution referred specifically to the May 11, 1998
election, its implications on the people's fundamental freedom of expression transcend the past
election. The holding of periodic elections is a basic feature of our democratic... government. By its
very nature, exit polling is tied up with elections. To set aside the resolution of the issue now will only
postpone a task that could well crop up again in future elections
In any event, in Salonga v. Cruz Pano, the Court had occasion to reiterate that it "also has the duty to
formulate guiding and controlling constitutional principles, precepts, doctrines, or rules. It has the
symbolic function of educating bench and bar on the extent of... protection given by constitutional
guarantees."
Since the fundamental freedoms of speech and of the press are being invoked here, we have
resolved to settle, for the guidance of posterity, whether they likewise protect the holding of exit polls
and the... dissemination of data derived therefrom.
Principles:
In any event, in Salonga v. Cruz Pano, the Court had occasion to reiterate that it "also has the duty to
formulate guiding and controlling constitutional principles, precepts, doctrines, or rules. It has the
symbolic function of educating bench and bar on the extent of... protection given by constitutional
guarantees.

48
CENTRAL BANK EMPLOYEES ASSOCIATION v. BANGKO SENTRAL NG PILIPINAS, GR No.
148208, 2004-12-15
Facts:
On July 3, 1993, R.A. No. 7653 (the New Central Bank Act) took effect. It abolished the old Central
Bank of the Philippines, and created a new BSP.
On June 8, 2001, almost eight years after the effectivity of R.A. No. 7653, petitioner Central Bank
(now BSP) Employees Association, Inc., filed a petition for prohibition against BSP and the Executive
Secretary of the Office of the President, to restrain respondents from... further implementing the last
proviso in Section 15(c), Article II of R.A. No. 7653, on the ground that it is unconstitutional.
In sum, petitioner posits that the classification is not reasonable but arbitrary and capricious, and
violates the equal protection clause of the Constitution.[
Issues:
whether the last paragraph of Section 15(c), Article II of R.A. No. 7653, runs afoul of the constitutional
mandate that "No person shall be. . . denied the equal protection of... the laws."
Ruling:
Congress is allowed a wide leeway in providing for a valid classification.[15] The equal protection
clause is not infringed by legislation which applies only to those persons falling within a specified
class.[16] If the groupings are... characterized by substantial distinctions that make real differences,
one class may be treated and regulated differently from another.[17] The classification must also be
germane to the purpose of the law and must apply to all those belonging to the same... class.[18]
In the case at bar, it is clear in the legislative deliberations that the exemption of officers (SG 20 and
above) from the SSL was intended to address the BSP's lack of competitiveness in terms of attracting
competent officers and executives. It was not intended to discriminate... against the rank-and-file. If
the end-result did in fact lead to a disparity of treatment between the officers and the rank-and-file in
terms of salaries and benefits, the discrimination or distinction has a rational basis and is not
palpably, purely, and entirely arbitrary in... the legislative sense.
While R.A. No. 7653 started as a valid measure well within the legislature's power, we hold that the
enactment of subsequent laws exempting all rank-and-file employees of other GFIs leeched all
validity out of the challenged proviso.
According to petitioner, the last proviso of Section 15(c), Article II of R.A. No. 7653 is also violative of
the equal protection clause because after it was enacted, the charters of the GSIS, LBP, DBP and
SSS were also amended, but the personnel of the latter GFIs were... all exempted from the coverage
of the SSL.[37] Thus, within the class of rank-and-file personnel of GFIs, the BSP rank-and-file are
also discriminated upon.
Thus, eleven years after the amendment of the BSP charter, the rank-and-file of seven other
But if the challenge to the statute is premised on the denial of a fundamental right, or the perpetuation
of prejudice against persons favored by the Constitution with special protection, judicial scrutiny ought
to be more strict.

49
EVELIO B. JAVIER v. COMELEC, GR Nos. 68379-81, 1986-09-22
Facts:
On May 13, 1984, the eve of the elections, the bitter contest between the two came to a head when
several followers of the petitioner were ambushed and killed, allegedly by the latter's men. Seven
suspects, including respondent Pacificador, are now facing... trial for these murders. The incident
naturally heightened tension in the province and sharpened the climate of fear among the electorate.
Conceivably, it intimidated voters against supporting the Opposition candidate or into supporting the
candidate of the ruling... party.
It was in this atmosphere that the voting was held, and the post-election developments were to run
true to form. Owing to what he claimed were attempts to railroad the private respondent's
proclamation, the petitioner went to the Commission on Elections to question the... canvass of the
election returns. His complaints were dismissed and the private respondent was proclaimed winner
by the Second Division of the said body. The petitioner thereupon came to this Court, arguing that
the proclamation was void because made only by a... division and not by the Commission on
Elections en banc as required by the Constitution. Meanwhile, on the strength of his proclamation,
the private respondent took his oath as a member of the Batasang Pambansa.
On May 18, 1984, the Second Division of the Commission on Elections directed the provincial board
of canvassers of Antique to proceed with the canvass but to suspend the proclamation of the winning
candidate until further orders.[3] On June 7, 1984, the... same Second Division ordered the board to
immediately convene and to proclaim the winner without prejudice to the outcome of the case before
the Commission... before this Court, the proclamation made by the board of canvassers was set
aside... as premature, having been made before the lapse of the 5-day period of appeal, which the
petitioner had seasonably made
Issues:
Was the Second Division of the Commission on Elections authorized to promulgate its decision of
July 23, 1984, proclaiming the private respondent the winner in the election?
Ruling:
Section 2 confers on the Commission on Elections the power to:
"(2) Be the sole judge of all contests relating to the election, returns and qualifications of all member
of the Batasang Pambansa and elective provincial and city officials."
The exception was the election contest involving the members of the Batasang Pambansa, which
had... to be heard and decided en banc.[11] The en banc requirement would apply only from the time
a candidate for the Batasang Pambansa was proclaimed as winner, for it was only then that a contest
could be permitted under the law.
As the Court sees it, the effect of this interpretation would be to divide the jurisdiction of the
Commission on Elections into two, viz.: (1) over matters arising before the proclamation, which
should be heard and decided by division in the exercise of its... administrative power; and (2) over
matters arising after the proclamation, which could be heard and decided only en banc in the exercise
of its judicial power.
This Court has repeatedly and consistently demanded "the cold neutrality of an impartial judge" as
the indispensable imperative of due process... we have held that the judge must not only be impartial
but must also appear to... be impartial as an added assurance to the parties that his decision will be
just.
Due process is intended to insure that confidence by requiring compliance with what Justice
Frankfurter calls the rudiments of fair play. Fair play calls for equal justice
The judge will reach his conclusions only after all the evidence is in and all the arguments are filed,
on the basis of the established facts and the pertinent... law.
WHEREFORE, let it be spread in the records of this case that were it not for the supervening events
that have legally rendered it moot and academic, this petition would have been granted and the
decision of the Commission on Elections dated July 23, 1984, set aside as... violative of the
Constitution.
Principles:
The Supreme Court is not only the highest arbiter of legal questions but also the conscience of the
government. The citizen comes to us in quest of law but we must also give him justice.
50
G.R. No. 59524
SALONGA v. PANO

GUTIERREZ, JR., J.:

The petitioner invokes the constitutionally protected right to life and liberty guaranteed by the due
process clause, alleging that no prima facie case has been established to warrant the filing of an
information for subversion against him. Petitioner asks this Court to prohibit and prevent the
respondents from using the iron arm of the law to harass, oppress, and persecute him, a member of
the democratic opposition in the Philippines.

The background of this case is a matter of public knowledge.

A rash of bombings occurred in the Metro Manila area in the months of August, September and
October of 1980. On September 6, 1980, one Victor Burns Lovely, Jr., a Philippine- born American
citizen from Los Angeles, California, almost killed himself and injured his younger brother, Romeo, as
a result of the explosion of a small bomb inside his room at the YMCA building in Manila. Found in
Lovely's possession by police and military authorities were several pictures taken sometime in May,
1980 at the birthday party of former Congressman Raul Daza held at the latter's residence in a Los
Angeles suburb. Petitioner Jovito R. Salonga and his wife were among those whose likenesses
appeared in the group pictures together with other guests, including Lovely.

As a result of the serious injuries he suffered, Lovely was brought by military and police authorities to
the AFP Medical Center (V. Luna Hospital) where he was placed in the custody and detention of Col.
Roman P. Madella, under the over-all direction of General Fabian Ver, head of the National
Intelligence and Security Authority (NISA). Shortly afterwards, Mr. Lovely and his two brothers,
Romeo and Baltazar Lovely were charged with subversion, illegal possession of explosives, and
damage to property.

On September 12, 1980, bombs once again exploded in Metro Manila including one which resulted in
the death of an American lady who was shopping at Rustan's Supermarket in Makati and others
which caused injuries to a number of persons.

On September 20, 1980, the President's anniversary television radio press conference was
broadcast. The younger brother of Victor Lovely, Romeo, was presented during the conference. In
his interview, Romeo stated that he had driven his elder brother, Victor, to the petitioner's house in
Greenhills on two occasions. The first time was on August 20, 1980. Romeo stated that Victor did
not bring any bag with him on that day when he went to the petitioner's residence and did not carry a
bag when he left. The second time was in the afternoon of August 31, 1980 when he brought Victor
only to the gate of the petitioner's house. Romeo did not enter the petitioner's residence. Neither did
he return that day to pick up his brother.

The next day, newspapers came out with almost identical headlines stating in effect that petitioner
had been linked to the various bombings in Metro Manila.

Meanwhile, on September 25, 1980, Lovely was taken out of the hospital's intensive care unit and
transferred to the office of Col. Madella where he was held incommunicado for some time.

On the night of October 4, 1980, more bombs were reported to have exploded at three big hotels in
Metro Manila, namely: Philippine Plaza, Century Park Sheraton and Manila Peninsula. The bombs
injured nine people. A meeting of the General Military Council was called for October 6, 1980.

On October 19, 1980, minutes after the President had finished delivering his speech before the
International Conference of the American Society of Travel Agents at the Philippine International
Convention Center, a small bomb exploded. Within the next twenty-four hours, arrest, search, and
seizure orders (ASSOs) were issued against persons who were apparently implicated by Victor
Lovely in the series of bombings in Metro Manila. One of them was herein petitioner. Victor Lovely
offered himself to be a "state witness" and in his letter to the President, he stated that he will reveal
everything he knows about the bombings.

On October 21, 1980, elements of the military went to the hospital room of the petitioner at the Manila
Medical Center where he was confined due to his recurrent and chronic ailment of bronchial asthma
and placed him under arrest. The arresting officer showed the petitioner the ASSO form which
however did not specify the charge or charges against him. For some time, the petitioner's lawyers

51
were not permitted to visit him in his hospital room until this Court in the case of Ordoñez v. Gen
Fabian Ver, et al., (G.R. No. 55345, October 28, 1980) issued an order directing that the petitioner's
right to be visited by counsel be respected.

On November 2, 1980, the petitioner was transferred against his objections from his hospital arrest to
an isolation room without windows in an army prison camp at Fort Bonifacio, Makati. The petitioner
states that he was not informed why he was transferred and detained, nor was he ever investigated
or questioned by any military or civil authority.

Subsequently, on November 27, 1980, the petitioner was released for humanitarian reasons from
military custody and placed "under house arrest in the custody of Mrs. Lydia Salonga" still without the
benefit of any investigation or charges.

On December 10, 1980, the Judge Advocate General sent the petitioner a "Notice of Preliminary
Investigation" in People v. Benigno Aquino, Jr., et al. (which included petitioner as a co-accused),
stating that "the preliminary investigation of the above-entitled case has been set at 2:30 o'clock p.m.
on December 12, 1980" and that petitioner was given ten (10) days from receipt of the charge sheet
and the supporting evidence within which to file his counter-evidence. The petitioner states that up to
the time martial law was lifted on January 17, 1981, and despite assurance to the contrary, he has not
received any copies of the charges against him nor any copies of the so-called supporting evidence.

On February 9, 1981, the records of the case were turned over by the Judge Advocate General's
office to the Ministry of Justice.

On February 24, 1981, the respondent City Fiscal filed a complaint accusing petitioner, among others
of having violated Republic Act No. 1700, as amended by P.D. 885 and Batas Pambansa Blg. 31 in
relation to Article 142 of the Revised Penal Code. The inquest court set the preliminary investigation
for March 17, 1981.

On March 6, 1981, the petitioner was allowed to leave the country to attend a series of church
conferences and undergo comprehensive medical examinations of the heart, stomach, liver, eye and
ear including a possible removal of his left eye to save his right eye. Petitioner Salonga almost died
as one of the principal victims of the dastardly bombing of a Liberal Party rally at Plaza Miranda on
August 20, 1971. Since then, he has suffered serious disabilities. The petitioner was riddled with
shrapnel and pieces still remain in various parts of his body. He has an AV fistula caused by a piece
of shrapnel lodged one millimeter from his aorta. The petitioner has limited use of his one remaining
hand and arms, is completely blind and physical in the left eye, and has scar like formations in the
remaining right eye. He is totally deaf in the right ear and partially deaf in the left ear. The
petitioner's physical ailments led him to seek treatment abroad.

On or around March 26, 1981, the counsel for petitioner was furnished a copy of an amended
complaint signed by Gen. Prospero Olivas, dated March 12, 1981, charging the petitioner, along with
39 other accused with the violation of R. A. 1700, as amended by P. D. 885, Batas Pambansa Blg. 31
and P. D. 1736. Hearings for preliminary investigation were conducted. The prosecution presented
as its witnesses Ambassador Armando Fernandez, the Consul General of the Philippines in Los
Angeles, California, Col. Balbino Diego, PSC/NISA, Chief, Investigation and Legal Panel of the
Presidential Security Command and Victor Lovely himself.

On October 15, 1981, the counsel for petitioner filed a motion to dismiss the charges against
petitioner for failure of the prosecution to establish a prima facie case against him.

On December 2, 1981, the respondent judge denied the motion. On January 4, 1982, he issued a
resolution ordering the filing of an information for violation of the Revised Anti- Subversion Act, as
amended, against forty (40) people, including herein petitioner.

The resolutions of the respondent judge dated December 2, 1981 and January 4, 1982 are now the
subject of the petition. It is the contention of the petitioner that no prima facie case has been
established by the prosecution to justify the filing of an information against him. He states that to
sanction his further prosecution despite the lack of evidence against him would be to admit that no
rule of law exists in the Philippines today.

After a painstaking review of the records, this Court finds the evidence offered by the prosecution
utterly insufficient to establish a prima facie case against the petitioner. We grant the petition.

However, before going into the merits of the case, we shall pass upon a procedural issue raised by

52
the respondents.

The respondents call for adherence to the consistent rule that the denial of a motion to quash or to
dismiss, being interlocutory in character, cannot be questioned by certiorari; that since the question of
dismissal will again be considered by the court when it decides the case, the movant has a plain,
speedy and adequate remedy in the ordinary course of law; and that public interest dictates that
criminal prosecutions should not be enjoined.

The general rule is correctly stated. However, the respondents fail to appreciate or take into account
certain exceptions when a petition for certiorari is clearly warranted. The case at bar is one such
exception.

In the case of Mead v. Angel (115 SCRA 256) the same contentions were advanced by the
respondents to wit:

xxx xxx xxx

"x x x Respondents advert to the rule that when a motion to quash filed by an accused in a criminal
case shall be denied, the remedy of the accused-movant is not to file a petition for certiorari or
mandamus or prohibition, the proper recourse being to go to trial, without prejudice to his right to
reiterate the grounds invoked in his motion to quash if an adverse judgment is rendered against him,
in the appeal that he may take therefrom in the manner authorized by law. (Mill v. People, et al., 101
Phil. 599; Echarol v. Purisima, et al., 13 SCRA 309.)
On this argument, we ruled:

"There is no disputing the validity and wisdom of the rule invoked by the respondents. However, it is
also recognized that, under certain situations, recourse to the extraordinary legal remedies of
certiorari, prohibition or mandamus to question the denial of a motion to quash is considered proper in
the interest of 'more enlightened and substantial justice', as was so declared in 'Yap v. Lutero', G. R.
No. L-12669, April 30, 1969".
Infinitely more important than conventional adherence to general rules of criminal procedure is
respect for the citizen's right to be free not only from arbitrary arrest and punishment but also from
unwarranted and vexatious prosecution. The integrity of a democratic society is corrupted if a person
is carelessly included in the trial of around forty persons when on the very face of the record no
evidence linking him to the alleged conspiracy exist.

Ex-Senator Jovito Salonga, himself a victim of the still unresolved and heinous Plaza Miranda
bombings, was arrested at the Manila Medical Center while hospitalized for bronchial asthma. When
arrested, he was not informed of the nature of the charges against him. Neither was counsel allowed
to talk to him until this Court intervened through the issuance of an order directing that his lawyers be
permitted to visit him (Ordoñez v. Gen. Fabian Ver, et al., G.R. No. 55345, October 28, 1980). Only
after four months of detention was the petitioner informed for the first time of the nature of the
charges against him. After the preliminary investigation, the petitioner moved to dismiss the
complaint but the same was denied. Subsequently, the respondent judge issued a resolution
ordering the filing of an information after finding that a prima facie case had been established against
all of the forty person accused.

In the light of the failure to show prima facie that the petitioner was probably guilty of conspiring to
commit the crime, the initial disregard of petitioner's constitutional rights together with the massive
and damaging publicity made against him, justifies the favorable consideration of this petition by this
Court. With former Senator Benigno Aquino, Jr. now deceased, there are at least 38 other co-
accused to be tried with the petitioner. The prosecution must present proof beyond reasonable doubt
against each and every one of the 39 accused, most of whom have varying participations in the
charge for subversion. The prosecution's star witness Victor Lovely and the only source of information
with regard to the alleged link between the petitioner and the series of terrorist bombings is now in the
United States. There is reason to believe the petitioner's citation of international news
dispatches* that the prosecution may find it difficult if not infeasible to bring him back to the
Philippines to testify against the petitioner. If Lovely refused to testify before an American federal
grand jury how could he possibly be made to testify when the charges against the respondent come
up in the course of the trial against the 39 accused. Considering the foregoing, we find it in the
interest of justice to resolve at this stage the issue of whether or not the respondent judge gravely
abused his discretion in issuing the questioned resolutions.

The respondents contend that the prosecution will introduce additional evidence during the trial and if

53
the evidence, by then, is not sufficient to prove the petitioner's guilt, he would anyway be acquitted.
Yes, but under the circumstances of this case, at what cost not only to the petitioner but to the basic
fabric of our criminal justice system?

The term "prima facie evidence" denotes evidence which, if unexplained or uncontradicted, is
sufficient to sustain the proposition it supports or to establish the facts, or to counterbalance the
presumption of innocence to warrant a conviction. The question raised before us now is: Were the
evidences against the petitioner uncontradicted and if they were unexplained or uncontradicted,
would they, standing alone, sufficiently overcome the presumption of innocence and warrant his
conviction?

We do not think so.

The records reveal that in finding a case against the petitioner, the respondent judge relied only on
the testimonies of Col. Balbino Diego and Victor Lovely. Ambassador Armando Fernandez, when
called upon to testify on subversive organizations in the United States nowhere mentioned the
petitioner as an organizer, officer or member of the Movement for Free Philippines (MFP), or any of
the organizations mentioned in the complaint. Col. Diego, on the other hand, when asked what
evidence he was able to gather against the petitioner depended only on the statement of Lovely "that
it was the residence of ex-Senator Salonga where they met together with Renato Tañada, one of the
brains of the bombing conspiracy x x x and the fact that Sen. Salonga has been meeting with several
subversive personnel based in the U.S.A. was also revealed to me by Victor Burns Lovely;" and on
the group pictures taken at former Congressman Raul Daza's birthday party. In concluding that a
conspiracy exists to overthrow by violent means the government of the Philippines in the United
States, his only bases were "documentary as well as physical and sworn statements that were
referred to me or taken by me personally," which of course negate personal knowledge on his part.
When asked by the court how he would categorize petitioner in any of the subversive organizations,
whether petitioner was an organizer, officer or a member, the witness replied:

To categorize former Senator Salonga if he were an organizer, he is an officer or he is a

member, your Honor, please, we have to consider the surrounding circumstances and on
"A. his involvement: first, Senator Salonga wanted always to travel to the United States at
least once a year or more often under the pretext of to undergo some sort of operation and
participate in some sort of seminar." (t.s.n., April 21, 1981, pp. 14-15)
Such testimony, being based on affidavits of other persons and purely hearsay, can hardly qualify as
prima facie evidence of subversion. It should not have been given credence by the court in the first
place. Hearsay evidence, whether objected to or not, has no probative value as the affiant could not
have been cross-examined on the facts stated therein. (See People v. Labinia, 115 SCRA 223;
People v. Valero, 112 SCRA 661). Moreover, as Victor Lovely, himself, was personally examined by
the court, there was no need for the testimony of Col. Diego. Thus, the inquest judge should have
confined his investigation to Victor Burns Lovely, the sole witness whose testimony had apparently
implicated petitioner in the bombings which eventually led to the filing of the information.

Lovely's account of the petitioner's involvement with the former's bombing mission is found in his
sworn statement made before Col. Diego and Lt. Col. Madella and taken on October 17, 1980 at the
AFP Medical Center. Lovely was not presented as a prosecution or state witness but only as
a defense witness for his two younger brothers, Romeo and Baltazar, who were both included in the
complaint but who were later dropped from the information. Victor Lovely was examined by his
counsel and cross-examined by the fiscal. In the process, he identified the statement which he made
before Col. Diego and Lt. Col Madella. After Lovely's testimony, the prosecution made a manifestation
before the court that it was adopting Lovely as a prosecution witness.

According to Lovely's statement, the following events took place:

"36. Q. Did Psinakis tell you where to stay?

Yes, at first he told me to check-in at Manila Hotel or the Plaza Hotel where somebody
would come to contact me and give the materials needed in the execution of my
mission. I thought this was not safe so I disagreed with him. Mr. Psinakis changed the
"A.
plan and instead told me to visit the residence of Ex-Sen. Jovito Salonga as often as I
can and someone will meet me there to give the materials I needed to accomplish my
mission.
"37. Q. Did you comply as instructed
Yes, I arrived in Manila on August 20, 1980 and stayed at the residence of Mr. Johnny
"A. Chua, husband of my business partner, then I went to the Hospital where I visited my
mother and checked-in at Room 303 of the YMCA at Concepcion Street, Manila-

54
"38. Q. Did you visit the residence of former Senator Jovito Salonga as directed by Psinakis?
I visited Sen. Salonga's place three (3) times, the first visit was August 20 or 21, and the
last was 4:00 P.M. of August 31, 1980. In addition to these visits, I TALKED to him on
the phone about three or four times. On my first visit, I told him 'I am expecting an
attache case from somebody which will be delivered to your house', for which Sen.
"A. Salonga replied 'Wala namang nagpunta dito at wala namang attache case para sa iyo.'
However, if your attache case arrives, I'll just call you.' I gave him my number. On my
second visit, Salonga said, 'I'll be very busy so just come back on the 31st of August at 4
P.M.' On that date, I was with friends at Batulao Resort and had to hurry back to be at
Salonga's place for the appointment. I arrived at Salonga's place at exactly 4 P.M.
"39. Q. What happened then?
I was ushered to the sala by Mrs. Salonga and after five minutes, Sen. Salonga joined
"A. me in the sala. Sen. Salonga informed me that somebody will be coming to give me the
attache case but did not tell me the name.
"Are there any subject matters you discussed while waiting for that somebody to deliver
40. Q.
your materials?
Yes, Salonga asked if Sen. Aquino and I have met, I explained to him the efforts of Raul
Daza in setting up that meeting but I have previous business commitments at Norfolk,
Virginia. I told him, however, that through the efforts of Raul Daza, I was able to talk with
"A.
Ninoy Aquino in the airport telephone booth in San Francisco. He also asked about Raul
Daza, Steve Psinakis and the latest opposition group activities but it seems he is well
informed.
"A. About thirty (30) minutes.
"41. Q. What happened when the man arrived?
This man arrived and I was greatly surprised to see Atty. Renato Tañada. Jovy Salonga
was the one who met him and as I observed parang nasa sariling bahay si Tañada nung
"A. dumating. They talked for five (5) minutes in very low tones so I did not hear what they
talked about. After their whispering conversations, Sen. Salonga left and at this time
Atty. 'Nits' Tañada told me 'Nasa akin ang kailangan mo, nasa kotse.'
"43. Q. Were the materials given to you?
When Sen. Salonga came back, we asked to be permitted to leave and I rode in Atty.
Nits Tañada's old Pontiac car colored dirty brown and proceeded to Broadway Centrum
"A.
where before I alighted, Atty. Tañada handed me a 'Puma' bag containing all the
materials I needed.
xxx xxx xxx
"45. Q. What were the contents of the Puma bag?
Ten (10) pieces of Westclox pocket watch with screw and wirings, ten (10) pieces
electrical blasting caps 4" length, ten (10) pieces non-electrical blasting caps 1" length,
"A.
nine (9) pieces volts dry cell battery, two (2) improvised electrical testers, ten (10) plastic
packs of high explosive about 1 pound weight each.
However, in his interview with Mr. Ronnie Nathanielz which was aired on Channel 4 on November 8,
1980 and which was also offered as evidence by the accused, Lovely gave a different story which
negates the above testimony insofar as the petitioner's participation was concerned:

xxx xxx xxx

Q. "Who were the people that you contacted in Manila and for what purpose?
Before I left for the Philippines, Mr. Psinakis told me to check in at the Manila Hotel or the
Plaza Hotel, and somebody would just deliver the materials I would need. I disapproved of
"A.
this, and I told him I would prefer a place that is familiar to me or who is close to me. Mr.
Psinakis suggested the residence of Sen. Salonga.
"And so, I arrived in Manila on August 20, 1980, I made a call to Sen. Salonga, but he was
out. The next day I made a call again. I was able to contact him. I made an appointment to
see him. I went to Sen. Salonga's house the following day. I asked Sen. Salonga if
someone had given him an attache case for me. He said nobody. Afterwards, I made
three calls to Sen. Salonga. Sen. Salonga told me 'call me again on the 31st of August. I
did not call him, I just went to his house on the 31st of August at 4 P.M. A few minutes
after my arrival, Atty. Renato Tañada arrived. When he had a chance to be near me, he
(Atty. Tañada) whispered to me that he had the attache case and the materials I needed in
his car. These materials were given to me by Atty. Tañada when I alighted at the
Broadway Centrum.' (Underscoring supplied)
During the cross-examination, counsel for petitioner asked Lovely about the so-called destabilization
plan which the latter mentioned in his sworn statement:

"Q. You mentioned in your statement taken on October 17, 1980, marked Exhibit 'G' about the
so-called destabilization plan of Aquino. When you attended the birthday party of Raul Daza

55
 wherein Jovito Salonga was also present, was this destabilization plan as alleged by you
already formulated?
WITNESS:
"A Not to my knowledge.
COURT TO WITNESS:
"Q. Mr. Witness, who invited you to the party?
"A. Raul Daza, your Honor.
"Q. Were you told that Mr. Salonga would be present in the party?
"A. I am really not quite sure, your Honor.
Alright. You said initially it was social but then it became political. Was there any
"Q.
political action taken as a result of the party?
"A. Only political discussion, your Honor." (TSN, July 8, 1981, pp. 69-84).
Counsel for petitioner also asked Lovely whether in view of the latter's awareness of the physical
condition of petitioner, he really implicated petitioner in any of the bombings that occurred in Metro
Manila. The fiscal objected without stating any ground. In sustaining the objection, the Court said:

"Sustained. . . The use of the word 'implicate' might expand the role of Mr. Salonga. In other words,
you are widenining the avenue of Mr. Salonga's role beyond the participation stated in the testimony
of this witness about Mr. Salonga, at least, as far as the evidence is concerned, I supposed, is only
being in the house of Mr. Salonga which was used as the contact point. He never mentions Mr.
Salonga about the bombings. Now these words had to be put in the mouth of this witness. That
would be unfair to Mr. Salonga." (TSN. July 8, 1981, p. 67)
Respondent judge further said:

"COURT:
"As the Court said earlier, the parts or portions affecting Salonga only refers to the witness
coming to Manila already then the matter of . . . I have gone over the statement and there is
no mention of Salonga insofar as activities in the United States is concerned. I don't know
why it concerns this cross-examination.
"ATTY. YAP:
"Because according to him, it was in pursuance of the plan that he came to Manila.
"COURT:
"According to him it was Aquino, Daza, and Psinakis who asked him to come here, but
Salonga was introduced only when he (Lovely) came here. Now, the tendency of the
question is also to connect Salonga to the activities in the United States. It seems to be the
thrust of the questions.
"COURT:
"In other words, the point of the Court as of the time when you asked him question, the
focus on Salonga was only from the time when he met Salonga at Greenhills. It was the
first time that the name of Salonga came up. There was no mention of Salonga in the
formulation of the destabilization plan as affirmed by him. But you are bringing this up
although you are only cross-examining for Salonga as if his (Lovely's) activities in the
United States affected Salonga. " (TSN. July 8, 1981, pp. 73-74).
Apparently, the respondent judge wanted to put things in proper perspective by limiting the
petitioner's alleged "participation" in the bombing mission only to the fact that petitioner's house was
used as a "contact point" between Lovely and Tañada, which was all that Lovely really stated in his
testimony.

However, in the questioned resolution dated December 2, 1981, the respondent judge suddenly
included the "activities" of petitioner in the United States as his basis for denying the motion to
dismiss:

"On the activities of Salonga in the United States, the witness, Lovely, in one of his statements
declared: 'To the best of my recollection he mentioned of some kind of violent struggle in the
Philippines being most likely should reforms be not instituted by President Marcos immediately.'

"It is therefore clear that the prosecution's evidence has established facts and circumstances
sufficient for a finding that excludes a Motion to Dismiss by respondent Salonga. The Movement for
Free Philippines is undoubtedly a force born on foreign soil, it appears to rely on the resources of
foreign entities, and is being (sic) on gaining ascendancy in the Philippines with the use of force and
for that purpose it has linked itself with even communist organizations to achieve its end. It appears
to rely on aliens for its supporters and financiers."
The jump from the "contact point" theory to the conclusion of involvement in subversive activities in
the United States is not only inexplicable but without foundation.

56
The respondents admit that no evidence was presented directly linking petitioner Salonga to actual
acts of violence or terrorism. There is no proof of his direct participation in any overt acts of
subversion. However, he is tagged as a leader of subversive organizations for two reasons -

(1) Because his house was used as a "contact point"; and

(2) Because "he mentioned some kind of violent struggle in the Philippines being most likely should
reforms be not instituted by President Marcos immediately."
The "contact point" theory or what the petitioner calls the "guilt by visit or guilt by association" theory
is too tenuous a basis to conclude that Senator Salonga was a leader or mastermind of the bombing
incidents. To indict a person simply because some plotters, masquerading as visitors, have
somehow met in his house or office would be to establish a dangerous precedent. The right of
citizens to be secure against abuse of governmental processes in criminal prosecutions would be
seriously undermined.

The testimony of Victor Lovely against petitioner Salonga is full of inconsistencies. Senator Salonga
and Atty. Renato Tañada could not have whispered to one another because the petitioner is almost
totally deaf. Lovely could not have met Senator Salonga at a Manglapus party in Washington, D.C. in
1977 because the petitioner left for the United States only on November, 1978. Senator Salonga
denies having known Mr. Lovely in the United States or in the Philippines. He states that he has
hundred of visitors from week to week in his residence but cannot recall any Victor Lovely.

The presence of Lovely in a group picture taken at Mr. Raul Daza's birthday party in Los Angeles
where Senator Salonga was a guest is not proof of conspiracy. As stated by the petitioner, in his
many years in the turbulent world of politics, he has posed with all kinds of people in various groups
and various places and could not possibly vouch for their conduct. Commenting on the matter,
newspaper columnist Teodoro Valencia stated that Filipinos love to pose with important visitors and
the picture proves nothing.

It is likewise probable that a national figure and former politician of Senator Salonga's stature can
expect guests and visitors of all kinds to be visiting his home or office. If a rebel or subversive
happens to pose with the petitioner for a group picture at a birthday party abroad, or even visit him
with others in his home, the petitioner does not thereby become a rebel or subversive, much less a
leader of a subversive group. More credible and stronger evidence is necessary for an indictment.
Nonetheless, even if we discount the flaws in Lovely's testimony and dismiss the refutations and
arguments of the petitioner, the prosecution evidence is still inadequate to establish a prima
facie finding.

The prosecution has not come up with even a single iota of evidence which could positively link the
petitioner to any proscribed activities of the Movement for Free Philippines or any subversive
organization mentioned in the complaint. Lovely had already testified that during the party of former
Congressman Raul Daza which was alleged to have been attended by a number of members of the
MFP, no political action was taken but only political discussion. Furthermore, the alleged opinion of
the petitioner about the likelihood of a violent struggle here in the Philippines if reforms are not
instituted, assuming that he really stated the same, is nothing but a legitimate exercise of freedom of
thought and expression. No man deserves punishment for his thoughts. Cogitationis poenam nemo
meretur. And as the late Justice Oliver W. Holmes stated in the case of U.S. v. Schwimmer, 279 U.S.
644, "x x x if there is any principle of the Constitution that more imperatively calls for attachment than
any other it is the principle of free thought - not free thought for those who agree with us but freedom
for the thought that we hate."

We have adopted the concept that freedom of expression is a "preferred" right and, therefore, stands
on a higher level than substantive economic or other liberties. The primacy, the high estate accorded
freedom of expression is a fundamental postulate of our constitutional system. (Gonzales v.
Commission on Elections, 29 SCRA 835). As explained by Justice Cardozo in Palko v.
Connecticut (302 U.S. 319) this must be so because the lessons of history, both political and legal,
illustrate that freedom of thought and speech is the indispensable condition of nearly every other form
of freedom. Protection is especially mandated for political discussions. This Court is particularly
concerned when allegations are made that restraints have been imposed upon mere criticisms of
government and public officials. Political discussion is essential to the ascertainment of political
truth. It cannot be the basis of criminal indictments.

The United States Supreme Court in Noto v. United States (367 U.S. 290) distinguished between the
abstract teaching of the moral propriety or even moral necessity for a resort to force and violence and
57
speech which would prepare a group for violent action and steel it to such action. In Watts v. United
States (394 U.S. 705), the American court distinguished between criminal threats and constitutionally
protected speech.

It stated:

"We do not believe that the kind of political hyperbole indulged in by petitioner fits within that statutory
term. For we must interpret the language Congress chose against the background of a profound
national commitment to the principle that debate on public issues should be uninhibited, robust, and
wide open and that it may well include vehement, caustic, and sometimes unpleasantly sharp attacks
on government and public officials. New York Times Co. v. Sullivan (376 U.S. 254). The language of
the political arena, like the language used in labor disputes is often vituperative, abusive, and
inexact. We agree with petitioner that his only offense was a kind of very crude offensive method of
stating a political opposition to the President.
In the case before us, there is no teaching of the moral propriety of a resort to violence, much less an
advocacy of force or a conspiracy to organize the use of force against the duly constituted
authorities. The alleged remark about the likelihood of violent struggle unless reforms are instituted is
not a threat against the government. Nor is it even the uninhibited, robust, caustic, or unpleasantly
sharp attack which is protected by the guarantee of free speech. Parenthetically, the American case
of Brandenburg v. Ohio (395 U.S. 444) states that the constitutional guarantees of free speech and
free press do not permit a State to forbid or proscribe advocacy of the use of force or of law violation
except where such advocacy is directed to inciting or producing imminent lawless action and is likely
to incite or produce such action. The words which petitioner allegedly used according to the best
recollections of Mr. Lovely are light years away from such type of proscribed advocacy.

Political discussion even among those opposed to the present administration is within the protective
clause of freedom of speech and expression. The same cannot be construed as subversive activities
per se or as evidence of membership in a subversive organization. Under Presidential Decree No.
885, Section 3, paragraph 6, political discussion will only constitute prima facie evidence of
membership in a subversive organization if such discussion amounts to:

"(6) Conferring with officers or other members of such association or organization in furtherance of
any plan or enterprise thereof."
As stated earlier, the prosecution has failed to produce evidence that would establish any link
between petitioner and any subversive organization. Even if we lend credence to Lovely's testimony
that a political discussion took place at Daza's birthday party, no proof whatsoever was adduced that
such discussion was in furtherance of any plan to overthrow the government through illegal means.
The alleged opinion that violent struggle is likely unless reforms are instituted by no means shows
either advocacy of or incitement to violence or furtherance of the objectives of a subversive
organization.

Lovely also declared that he had nothing to do with the bombing on August 22, 1980, which was the
only bombing incident that occurred after his arrival in Manila on August 20, and before the YMCA
explosion on September 6, 1980. (See TSN, pp. 63-63, July 8, 1981). He further testified that:

"WITNESS:
"Actually, it was not my intention to do some kind of bombing against the government. My
bombing mission was directed against the particular family (referring to the Cabarrus
family). [TSN, p. 11, July 9, 1981] [Rollo, p. 10].
Such a statement wholly negates any politically motivated or subversive assignment which Lovely
was supposed to have been commissioned to perform upon the orders of his co-accused and which
was the very reason why they were charged in the first place. The respondent judge also asked
Lovely about the possible relation between Cabarrus and petitioner:

"COURT:
Did you suspect any relation between Cabarrus and Jovito Salonga, why did you implicate
"Q.
Jovito Salonga?
"A. No, your Honor. I did not try to implicate Salonga.
It should be noted that after Lovely's testimony, the prosecution manifested to the court that it was
adopting him as a prosecution witness. Therefore, the prosecution became irreversively bound by
Lovely's disclaimers on the witness stand, that it was not his intention "to do some kind of bombing
against the government" and that he "did not try to implicate Salonga", especially since Lovely is the
sole witness adopted by the prosecution who could supposedly establish the link between the
petitioner and the bombing incidents.

58
The respondent court should have taken these factors into consideration before concluding that
a prima facie case exists against the petitioner. Evidence must not only proceed from the mouth of a
credible witness but it must be credible in itself such as the common experience and observation of
mankind can approve as probable under the circumstances. (People v. Dayad, 56 SCRA 439) In the
case at bar, the prosecution cannot even present a credible version of the petitioner's role in the
bombings even if it ignores the subsequent disclaimers of Lovely and without relying on mere
affidavits including those made by Lovely during his detention.

The resolution dated January 4, 1982 suffers from the same defect. In this resolution, Lovely's
previous declarations about the bombings as part of the alleged destabilization plan and the people
behind the same were accorded such credibility by the respondent judge as if they had already been
proved beyond reasonable doubt.

The purpose of a preliminary investigation is to secure the innocent against hasty, malicious and
oppressive prosecution, and to protect him from an open and public accusation of crime, from the
trouble, expense and anxiety of a public trial, and also to protect the state from useless and
expensive trials. (Trocio v. Manta, 118 SCRA 241; citing Hashim v. Boncan, 71 Phil. 216). The right
to a preliminary investigation is a statutory grant, and to withhold it would be to transgress
constitutional due process. (See People v. Oandasa, 25 SCRA 277) However, in order to satisfy the
due process clause it is not enough that the preliminary investigation is conducted in the sense of
making sure that a transgressor shall not escape with impunity. A preliminary investigation serves
not only the purposes of the State. More important, it is a part of the guarantees of freedom and fair
play which are birthrights of all who live in our country. It is, therefore, imperative upon the fiscal or
the judge as the case may be, to relieve the accused from the pain of going through a trial once it is
ascertained that the evidence is insufficient to sustain a prima facie case or that no probable cause
exists to form a sufficient belief as to the guilt of the accused. Although there is no general formula or
fixed rule for the determination of probable cause since the same must be decided in the light of the
conditions obtaining in given situations and its existence depends to a large degree upon the finding
or opinion of the judge conducting the examination, such a finding should not disregard the facts
before the judge nor run counter to the clear dictates of reasons (See La Chemise Lacoste, S.A. v.
Fernandez, 129 SCRA 391). The judge or fiscal, therefore, should not go on with the prosecution in
the hope that some credible evidence might later turn up during trial for this would be a flagrant
violation of a basic right which the courts are created to uphold. It bears repeating that the judiciary
lives up to its mission by vitalizing and not denigrating constitutional rights. So it has been before. It
should continue to be so. (Mercado v. Court of First Instance of Rizal, 116 SCRA 93).

The Court had already deliberated on this case, a consensus on the Court's judgment had been
arrived at, and a draft ponencia was circulating for concurrences and separate opinions, if any, when
on January 18, 1985, respondent Judge Rodolfo Ortiz granted the motion of respondent City Fiscal
Sergio Apostol to drop the subversion case against the petitioner. Pursuant to instructions of the
Minister of Justice, the prosecution restudied its evidence and decided to seek the exclusion of
petitioner Jovito Salonga as one of the accused in the information filed under the questioned
resolution.

We were constrained by this action of the prosecution and the respondent Judge to withdraw the
draft ponencia from circulating for concurrences and signatures and to place it once again in the
Court's crowded agenda for further deliberations.

Insofar as the absence of a prima facie case to warrant the filing of subversion charges is concerned,
this decision has been rendered moot and academic by the action of the prosecution.

Respondent Fiscal Sergio Apostol correctly points out, however, that he is not precluded from filing
new charges for the same acts because the petitioner has not been arraigned and double jeopardy
does not apply. In that sense, the case is not completely academic.

Recent developments in this case serve to focus attention on a not too well known aspect of the
Supreme Court's functions.

The setting aside or declaring void, in proper cases, of intrusions of State authority into areas
reserved by the Bill of Rights for the individual as constitutionally protected spheres where even the
awesome powers of Government may not enter at will is not the totality of the Court's functions.

The Court also has the duty to formulate guiding and controlling constitutional principles, precepts,
doctrines, or rules. It has the symbolic function of educating bench and bar on the extent of

59
protection given by constitutional guarantees.

In Dela Camara v. Enage (41 SCRA 1), the petitioner who questioned a P1,195,200.00 bail bond as
excessive and, therefore, constitutionally void, escaped from the provincial jail while his petition was
pending. The petition became moot because of his escape but we nonetheless rendered a decision
and stated:

"The fact that the case is moot and academic should not preclude this Tribunal from setting forth in
language clear and unmistakable, the obligation of fidelity on the part of lower court judges to the
unequivocal command of the Constitution that excessive bail shall not be required."
In Gonzales v. Marcos (65 SCRA 624) whether or not the Cultural Center of the Philippines could
validly be created through an executive order was mooted by Presidential Decree No. 15, the
Center's new charter pursuant to the President's legislative powers under martial law. Still, this Court
discussed the constitutional mandate on the preservation and development of Filipino culture for
national identity. (Article XV, Section 9, Paragraph 2 of the Constitution).

In the habeas corpus case of Aquino, Jr., v. Enrile, 59 SCRA 183), during the pendency of the case,
26 petitioners were released from custody and one withdrew his petition. The sole remaining
petitioner was facing charges of murder, subversion, and illegal possession of firearms. The fact that
the petition was moot and academic did not prevent this Court in the exercise of its symbolic function
from promulgating one of the most voluminous decisions ever printed in the Reports.

In this case, the respondents agree with our earlier finding that the prosecution evidence miserably
fails to establish a prima facie case against the petitioner, either as a co-conspirator of a
destabilization plan to overthrow the government or as an officer or leader of any subversive
organization. They have taken the initiative of dropping the charges against the petitioner. We
reiterate the rule, however, that this Court will not validate the filing of an information based on the
kind of evidence against the petitioner found in the records.

WHEREFORE, the petition is DISMISSED for having become moot and academic.

SO ORDERED.

Fernando, C.J., Teehankee, Makasiar, Concepcion, Jr., Melencio-Herrera, Plana, Escolin, Relova,
and Cuevas, JJ., concur.
Aquino, De la Fuente, and Alampay, JJ., no part.
Abad Santos, J., separate opinion.

*
In the Philippines Daily Express, dated December 8, 1981, Lovely was quoted as having said in the
United States that "I was not the bomber, I was bombed."

"Lovely, who was granted immunity in the United States, reportedly would not testify before a San
Francisco federal grand jury and instead said, "Your Honor, I came back to tell what happened in the
Philippines. I was not the bomber, I was bombed."
The United States Press International dispatch from San Francisco, U. S., written by Spencer
Sherman, gives a fuller account, thus:

"With the grand jury present in the courtroom Lovely alleged it was Philippine authorities who were
responsible for his injuries. It was they, not him, who placed the bomb in his hotel room, he said.

"I came back to the States to tell what happened in the Philippines. I was not the bomber. I was
bombed. There are so many secrets that will come out soon. I cannot (testify) even if I will be jailed
for lifetime. I welcome that."

--UPO press dispatch from San Francisco, November 24,

1981.
The Philippine News, a San Francisco-based weekly, in its issue of December 23, 1981, contains the
same account, with the following words

"Your Honor. . . I am not going to participate I was almost murdered. I cannot continue. My friends
were murdered before I came to the United States. . . I came back to the United States to tell what
happened in the Philippines. I was not the bomber, I was bombed. There are many secrets that will
come out very soon I cannot. Even if I will be jailed for my lifetime. I welcome that."
60
CONCURRING OPINION

ABAD SANTOS, J.:

Del Castillo vs. Ponce Enrile, G.R. No. 62119, August 27, 1984, 131 SCRA 405, was a petition for the
writ of habeas corpus. Before this Court could finally act on the petition, the subject was released and
for that reason the majority of this Court resolved to dismiss the petition for having become moot and
academic. Justice Teehankee and the undersigned disagreed with the majority; we expressed the
view that despite the release of the subject, the petition should have been resolved on the merits
because it posed important legal questions.

Babst, et al. vs. National Intelligence Board, Special Committee No. 2, et al., G.R. No. 62992, Sept. 2,
1984, was a petition for prohibition to restrain the respondents from interrogating the petitioners,
members of the print media, on various aspects of their works, feelings, sentiments, beliefs,
associations and even their private lives. Again the majority of this Court dismissed the petition
because the assailed proceedings had come to an end thereby rendering the petition moot and
academic. In dismissing the petition a short and mild note of concern was added. And again Justice
Teehankee and the undersigned disagreed with the majority. We expressed the view that this Court
should rule squarely on the matters raised in the petition rather than dismiss it for having become
moot and academic.

I am glad that this Court has abandoned its cavalier treatment of petitions by dismissing them on the
ground that they have become moot and academic and stopped there. I am glad it has reverted to De
la Camara vs. Enage, Gonzales vs. Marcos and Aquino vs. Enrile which are mentioned in
the ponencia of Justice Gutierrez.

I agree with the ponencia of Justice Gutierrez that because the subversion charges against the
petitioner had been dropped by the trial court on January 18, 1985, there is no longer any need to
prohibit the respondents from prosecuting Criminal Case No. Q-18606 insofar as he is concerned.
I am not revealing any confidential matter by saying that the initial action of this Court was to grant the
petition, i.e. prohibit the prosecution of the petitioner. This is manifest from the ponencia of Justice
Gutierrez. I regret that on this matter the Court has been pre-empted by a "first strike" which has
occurred once too often.
Justice Gutierrez states that, "The Court had already deliberated on this case, and a consensus on
the Court's judgment had been arrived at." Let me add that the consensus had taken place as early
as October 24, 1984, and the decision started to circulate for signature on November 2, 1984. Alas,
on January 18, 1985, the decision was still circulating - overtaken by events. The decision could have
had a greater impact had it been promulgated prior to the executive action.

[ GR No. L-23127, Apr 29, 1971 ]

FRANCISCA SERRANO DE AGBAYANI v. PHILIPPINE NATIONAL BANK +
DECISION
148 Phil. 443

FERNANDO, J.:
A correct appreciation of the controlling doctrine as to the effect, if any, to be attached to a statute
subsequently adjudged invalid, is decisive of this appeal from a lower court decision. Plaintiff
Francisca Serrano de Agbayani, now appellee, was able to obtain a favorable judgment in her suit
against defendant, now appellant Philippine National Bank, permanently enjoining the other
defendant, the Provincial Sheriff of Pangasinan, from proceeding with an extra-judicial foreclosure
sale of land belonging to plaintiff mortgaged to appellant Bank to secure a loan declared no longer
enforceable, the prescriptive period having lapsed. There was thus a failure to sustain the defense
raised by appellant that if the moratorium under an Executive Order and later an Act subsequently
found unconstitutional were to be counted in the computation, then the right to foreclose the mortgage
was still subsisting. In arriving at such a conclusion, the lower court manifested a tenacious
adherence to the inflexible view that an unconstitutional act is not a law, creating no rights and
imposing no duties, and thus as inoperative as if it had never been. It was oblivious to the force of
the principle adopted by this Court that while a statute's repugnancy to the fundamental law deprives
it of its character as a juridical norm, its having been operative prior to its being nullified is a fact that
61
is not devoid of legal consequences. As will hereafter be explained, such a failing of the lower court
resulted in an erroneous decision. We find for appellant Philippine National Bank, and we reverse.
There is no dispute as to the facts. Plaintiff obtained the loan in the amount of P450.00 from
defendant Bank dated July 19, 1939, maturing on July 19, 1944, secured by real estate mortgage
duly registered covering property described in T. C.T. No. 11275 of the province of Pangasinan. As
of November 27, 1959, the balance due on said loan was in the amount of P1,294.00. As early as
July 13 of the same year, defendant instituted extra-judicial foreclosure proceedings in the office of
defendant Provincial Sheriff of Pangasinan for the recovery of the balance of the loan remaining
unpaid. Plaintiff countered with this suit against both defendants on August 10, 1959, her main
allegation being that the mortgage sought to be foreclosed had long prescribed, fifteen years having
elapsed from the date of maturity, July 19, 1944. She sought and was able to obtain a writ of
preliminary injunction against defendant Provincial Sheriff, which was made permanent in the
decision now on appeal. Defendant Bank in its answer prayed for the dismissal of the suit as even on
plaintiff's own theory the defense of prescription would not be available if the period from March 10,
1945, when Executive Order No. 32[1] was issued, to July 26, 1948, when the subsequent legislative
act[2] extending the period of moratorium was declared invalid, were to be deducted from the
computation of the time during which the bank took no legal steps for the recovery of the loan. As
noted, the lower court did not find such contention persuasive and decided the suit in favor of plaintiff.
Hence this appeal, which, as made clear at the outset, possesses merit, there being a failure on the
part of the lower court to adhere to the applicable constitutional doctrine as to the effect to be given to
a statute subsequently declared invalid.
1. The decision now on appeal reflects the orthodox view that an unconstitutional act, for that matter
an executive order or a municipal ordinance likewise suffering from that infirmity, cannot be the
source of any legal rights or duties. Nor can it justify any official act taken under it. Its repugnancy to
the fundamental law once judicially declared results in its being to all intents and purposes a mere
scrap of paper. As the new Civil Code puts it: "When the courts declare a law to be inconsistent with
the Constitution, the former shall be void and the latter shall govern. Administrative or executive acts,
orders and regulations shall be valid only when they are not contrary to the laws or the
Constitution."[3] It is understandable why it should be so, the Constitution being supreme and
paramount. Any legislative or executive act contrary to its terms cannot survive.
Such a view has support in logic and possesses the merit of simplicity. It may not however be
sufficiently realistic. It does not admit of doubt that prior to the declaration of nullity such challenged
legislative or executive act must have been in force and had to be complied with. This is so as until
after the judiciary, in an appropriate case, declares its invalidity, it is entitled to obedience and
respect. Parties may have acted under it and may have changed their positions. What could be
more fitting than that in a subsequent litigation regard be had to what has been done while such
legislative or executive act was in operation and presumed to be valid in all respects. It is now
accepted as a doctrine that prior to its being nullified, its existence as a fact must be reckoned
with. This is merely to reflect awareness that precisely because the judiciary is the governmental
organ which has the final say on whether or not a legislative or executive measure is valid, a period of
time may have elapsed before it can exercise the power of judicial review that may lead to a
declaration of nullity. It would be to deprive the law of its quality of fairness and justice then, if there
be no recognition of what had transpired prior to such adjudication.
In the language of an American Supreme Court decision: "The actual existence of a statute, prior to
such a determination [of unconstitutionality], is an operative fact and may have consequences which
cannot justly be ignored. The past cannot always be erased by a new judicial declaration. The effect
of the subsequent ruling as to invalidity may have to be considered in various aspects, with respect to
particular relations, individual and corporate, and particular conduct, private and official." [4] This
language has been quoted with approval in a resolution in Araneta v. Hill[5] and the decision in Manila
Motor Co., Inc. v. Flores.[6] An even more recent instance is the opinion of Justice Zaldivar speaking
for the Court in Fernandez v. Cuerva and Co.[7]
2. Such an approach all the more commends itself whenever police power legislation intended to
promote public welfare but adversely affecting property rights is involved. While subject to be
assailed on due process, equal protection and non-impairment grounds, all that is required to avoid
the corrosion of invalidity is that the rational basis or reasonableness test is satisfied. The legislature
on the whole is not likely to allow an enactment suffering, to paraphrase Cardozo, from the infirmity of
outrunning the bounds of reason and resulting in sheer oppression. It may be of course that if
challenged, an adverse judgment could be the result, as its running counter to the Constitution could
still be shown. In the meanwhile though, in the normal course of things, it has been acted upon by
the public and accepted as valid. To ignore such a fact would indeed be the fruitful parent of
injustice. Moreover, as its constitutionality is conditioned on its being fair or reasonable, which in turn

62
is dependent on the actual situation, never static but subject to change, a measure valid when
enacted may subsequently, due to altered circumstances, be stricken down.
That is precisely what happened in connection with Republic Act No. 342, the moratorium legislation,
which continued Executive Order No. 32, issued by the then President Osmeña, suspending the
enforcement of payment of all debts and other monetary obligations payable by war sufferers. So it
was explicitly held in Rutter v. Esteban[8] where such enactment was considered in 1953
"unreasonable and oppressive, and should not be prolonged a minute longer, and, therefore, the
same should be declared null and void and without effect."[9] At the time of the issuance of the above
Executive Order in 1945 and of the passage of such Act in 1948, there was a factual justification for
the moratorium. The Philippines was confronted with an emergency of impressive magnitude at the
time of her liberation from the Japanese military forces in 1945. Business was at a standstill. Her
economy lay prostrate. Measures, radical measures, were then devised to tide her over until some
semblance of normalcy could be restored and an improvement in her economy noted. No wonder
then that the suspension of enforcement of payment of the obligations then existing was declared first
by executive order and then by legislation. The Supreme Court was right therefore in rejecting the
contention that on its face, the Moratorium Law was unconstitutional, amounting as it did to the
impairment of the obligation of contracts. Considering the circumstances confronting the legitimate
government upon its return to the Philippines, some such remedial device was needed and badly
so. An unyielding insistence then on the right to property on the part of the creditors was not likely to
meet with judicial sympathy. Time passed however, and conditions did change.
When the legislation was before this Court in 1953, the question before it was its satisfying the
rational basis test, not as of the time of its enactment but as of such date. Clearly, if then it were
found unreasonable, the right to non-impairment of contractual obligations must prevail over the
assertion of community power to remedy an existing evil. The Supreme Court was convinced that
such indeed was the case. As stated in the opinion of Justice Bautista Angelo: "But we should not
lose sight of the fact that these obligations had been pending since 1945 as a result of the issuance
of Executive Orders Nos. 25 and 32 and at present their enforcement is still inhibited because of the
enactment of Republic Act No. 342 and would continue to be unenforceable during the eight-year
period granted to prewar debtors to afford them an opportunity to rehabilitate themselves, which in
plain language means that the creditors would have to observe a vigil of at least twelve (12) years
before they could affect a liquidation of their investment dating as far back as 1941. This period
seems to us unreasonable, if not oppressive. While the purpose of Congress is plausible, and should
be commended, the relief accorded works injustice to creditors who are practically left at the mercy of
the debtors. Their hope to effect collection becomes extremely remote, more so if the credits are
unsecured. And the injustice is more patent when, under the law, the debtor is not even required to
pay interest during the operation of the relief, unlike similar statutes in the United States." [10] The
conclusion to which the foregoing considerations inevitably led was that as of the time of adjudication,
it was apparent that Republic Act No. 342 could not survive the test of validity. Executive Order No.
32 should likewise be nullified. That before the decision they were not constitutionally infirm was
admitted expressly. There is all the more reason then to yield assent to the now prevailing principle
that the existence of a statute or executive order prior to its being adjudged void is an operative fact
to which legal consequences are attached.
3. Precisely though because of the judicial recognition that moratorium was a valid governmental
response to the plight of the debtors who were war sufferers, this Court has made clear its view in a
series of cases impressive in their number and unanimity that during the eight-year period that
Executive Order No. 32 and Republic Act No. 342 were in force, prescription did not run. So it has
been held from Day v. Court of First Instance,[11] decided in 1954, to Republic v. Hernaez,[12] handed
down only last year. What is deplorable is that as of the time of the lower court decision on January
27, 1960, at least eight decisions had left no doubt as to the prescriptive period being tolled in the
meanwhile prior to such adjudication of invalidity.[13] Speaking of the opposite view entertained by the
lower court, the present Chief Justice, in Liboro v. Finance and Mining Investments Corp.[14] has
categorized it as having been "explicitly and consistently rejected by this Court." [15]
The error of the lower court in sustaining plaintiff's suit is thus manifest. From July 19, 1944, when
her loan matured, to July 13, 1959, when extra-judicial foreclosure proceedings were started by
appellant Bank, the time consumed is six days short of fifteen years. The prescriptive period was
tolled, however, from March 10, 1945, the effectivity of Executive Order No. 32, to May 18, 1953,
when the decision of Rutter v. Esteban was promulgated, covering eight years, two months and eight
days. Obviously then, when resort was had extra-judicially to the foreclosure of the mortgage
obligation, there was time to spare before prescription could be availed of as a defense.
WHEREFORE, the decision of January 27, 1960 is reversed and the suit of plaintiff filed August 10,
1959 dismissed. No costs.

63
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Ruiz
Castro, Teehankee, Barredo, Villamor, and Makasiar, JJ., concur.

CIR v. SAN ROQUE POWER CORPORATION, GR No. 187485, 2013-02-12

Facts:
[San Roque] entered into a Power Purchase Agreement ("PPA") with the National Power Corporation
("NPC") to develop hydro-potential of the Lower Agno River and generate additional power and
energy for the Luzon Power Grid, by building the San Roque
Multi-Purpose Project located in San Manuel, Pangasinan.
On the construction and development of the San Roque Multi-Purpose Project which comprises of the
dam, spillway and power plant, [San Roque] allegedly incurred, excess input VAT... which it declared
in its Quarterly VAT Returns... filed for the same year. [San Roque] duly filed with the BIR separate
claims for refund, in the total amount of P559,709,337.54, representing unutilized input taxes as
declared in its VAT returns for taxable year 2001.
March 28, 2003
[San Roque] filed amended Quarterly VAT Returns for the year 2001 since it increased its unutilized
input VAT
[CIR's] inaction on the subject claims led to the filing by [San Roque] of the Petition for Review with
the Court [of Tax Appeals] in Division on April 10, 2003.
Issues:
I. The Court of Tax Appeals En Banc erred in holding that [San Roque's] claim for refund was not
prematurely filed.
Ruling:
a. G.R. No. 187485 - CIR v. San Roque Power Corporation
64
On 10 April 2003, a mere 13 days after it filed its amended administrative claim with the
Commissioner on 28 March 2003, San Roque filed a Petition for Review with the CTA... first, San
Roque did not wait... for the 120-day period to lapse before filing its judicial claim; second, San Roque
filed its judicial claim more than four (4) years before the Atlas[45] doctrine, which was promulgated
by the Court on 8 June 2007.
Clearly, San Roque failed to comply with the 120-day waiting period, the time expressly given by law
to the Commissioner to decide whether to grant or deny San Roque's application for tax refund or
credit.
compliance with the 120-day waiting period is... mandatory and jurisdictional.
Failure to comply with the 120-day waiting period violates a mandatory provision of law. It violates the
doctrine of exhaustion of administrative remedies and renders the petition premature and thus without
a cause of action, with the effect that the CTA does not acquire... jurisdiction over the taxpayer's
petition.
San Roque's failure to comply with the 120-day mandatory period renders its petition for review with
the CTA void.
This Court cannot brush aside the grave issue of the mandatory and jurisdictional nature of the 120-
day period just because
Commissioner... does not question the entitlement of San Roque to the refund.
The mere... fact that a taxpayer has undisputed excess input VAT, or that the tax was admittedly
illegally, erroneously or excessively collected from him, does not entitle him as a matter of right to a
tax refund or credit. Strict compliance with the mandatory and jurisdictional conditions... prescribed by
law to claim such tax refund or credit is essential and necessary for such claim to prosper. Well-
settled is the rule that tax refunds or credits, just like tax exemptions, are strictly construed against the
taxpayer.[51] The burden is... on the taxpayer to show that he has strictly complied with the
conditions for the grant of the tax refund or credit.
This Court cannot disregard mandatory and jurisdictional conditions mandated by law simply because
the Commissioner chose not to contest the numerical correctness of the claim for tax refund or credit
of the taxpayer.
Non-compliance with mandatory periods, non-observance of... prescriptive periods, and non-
adherence to exhaustion of administrative remedies bar a taxpayer's claim for tax refund or credit,
whether or not the Commissioner questions the numerical correctness of the claim of the taxpayer.
This law is clear, plain, and unequivocal. Following the well-settled verba legis doctrine, this law
should be applied exactly as worded since it is clear, plain, and unequivocal.
the taxpayer may, if he wishes, appeal the decision of the Commissioner... to the CTA within 30 days
from receipt of the Commissioner's decision, or if the Commissioner does not act on the taxpayer's
claim within the 120-day period, the taxpayer may appeal to the CTA within 30 days from the
expiration of the 120-day period.

MARIA CAROLINA P. ARAULLO v. BENIGNO SIMEON C. AQUINO III, GR No. 209287, 2014-07-01
Facts:
For resolution are the consolidated petitions assailing the constitutionality of the Disbursement
Acceleration Program (DAP), National Budget Circular (NBC) No. 541, and related issuances of the
Department of Budget and Management (DBM) implementing the DAP.
At the core of the controversy is Section 29(1) of Article VI of the 1987 Constitution, a provision of the
fundamental law that firmly ordains that "[n]o money shall be paid out of the Treasury except in
pursuance of an appropriation made by law."
Used constitutional powers under Sec. 25(5) as a guise to use money out of the treasury
without an appropriation made by law... indicate that the DAP contravened this provision by
allowing the Executive to allocate public money pooled from programmed and unprogrammed funds
of its various agencies in the guise of the President exercising his... constitutional authority under
Section 25(5) of the 1987 Constitution to transfer funds out of savings to augment the appropriations
of offices within the Executive Branch of the Government.
Sen. Jinggoy Ejercito Estrada... had been allotted an additional P50 Million each as "incentive" for
voting in favor of the impeachment of Chief
Justice Renato C. Corona.

65
Abad: Releases to Senators Part of Spending Acceleration Program,[1] explaining that the funds
released to the Senators had been part of... the DAP, a program designed by the DBM to ramp up
spending to accelerate economic expansion.
He clarified that the funds had been released to the Senators based on their letters of request for
funding
He explained that the funds under the DAP were usually taken from (1) unreleased appropriations
under
Personnel Services;[2] (2) unprogrammed funds; (3) carry-over appropriations unreleased from the
previous year; and (4) budgets for slow-moving items or projects that had been realigned to support
faster-disbursing projects.
The DBM soon came out to claim in its website[3] that the DAP releases had been sourced from
savings generated by the Government, and from unprogrammed funds; and that the savings had
been derived from (1) the pooling of unreleased appropriations, like... unreleased Personnel
Services[4] appropriations that would lapse at the end of the year, unreleased appropriations of slow-
moving projects and discontinued projects per zero-based budgeting findings;[5] and (2) the
withdrawal of... unobligated allotments also for slow-moving programs and projects that had been
earlier released to the agencies of the National Government.
The DBM listed the following as the legal bases for the DAP's use of savings,[
Why DAP is legal according to DBM
(1) Section 25(5), Article VI of the 1987 Constitution, which granted to the President the authority to
augment an item for his office in the general appropriations... law; (2) Section 49 (Authority to Use
Savings for Certain Purposes) and Section 38 (Suspension of Expenditure Appropriations), Chapter
5, Book VI of Executive Order (EO) No. 292 (Administrative Code of 1987); and (3) the General
Appropriations Acts (GAAs) of
2011, 2012 and 2013, particularly their provisions on the (a) use of savings; (b) meanings of savings
and augmentation; and (c) priority in the use of savings.
Issues:
Procedural Issue:... whether there is a controversy ripe for judicial determination, and the standing of
petitioners.
Substantive Issues:
B. Whether or not the DAP violates Sec. 29, Art. VI of the 1987 Constitution, which provides: "No
money shall be paid out of the Treasury except in pursuance of an appropriation made by law."

Issue pertinent to Sec. 25

C. Whether or not the DAP, NBC No. 541, and all other executive issuances allegedly implementing
the DAP violate Sec. 25(5), Art. VI of the 1987 Constitution insofar as:
(a) They treat the unreleased appropriations and unobligated allotments withdrawn from government
agencies as "savings" as the term is used in Sec. 25(5), in relation to the provisions of the GAAs of
2011, 2012 and 2013;
(b) They authorize the disbursement of funds for projects or programs not provided in the GAAs for
the Executive Department; and
(c) They "augment" discretionary lump sum appropriations in the GAAs
D. Whether or not the DAP violates: (1) the Equal Protection Clause, (2) the system of checks and
balances, and (3) the principle of public accountability enshrined in the 1987 Constitution considering
that it authorizes the release of funds upon the request of... legislators.
E. Whether or not factual and legal justification exists to issue a temporary restraining order to
restrain the implementation of the DAP, NBC No. 541, and all other executive issuances allegedly
implementing the DAP.

66
F. Whether or not the release of unprogrammed funds under the DAP was in accord with the GAAs.
Ruling:
Procedural Issue:... a) The petitions under Rule 65 are... proper remedies
Judicial power includes the duty of the courts of justice to settle actual controversies involving rights
which are legally demandable and enforceable, and to determine whether or not there has been a
grave abuse of discretion amounting to lack or excess of jurisdiction on the... part of any branch or
instrumentality of the Government.
b) Requisites for the exercise of the power... of judicial review were complied with
(1) there must be an actual case or justiciable controversy before the Court; (2) the question before
the Court must be ripe for adjudication; (3) the person challenging the act must be a... proper party;
and (4) the issue of constitutionality must be raised at the earliest opportunity and must be the very
litis mota of the case
Under their respective circumstances, each of the petitioners has established sufficient interest in the
outcome of the controversy as to confer locus standi on each of them.
II.
Substantive Issues

1. Overview of the Budget System

PAP... c. DAP was not an appropriation... measure; hence, no appropriation... law was required to
adopt or to... implement it... that no law was necessary for the adoption and implementation of the
DAP because of its being neither a fund nor an appropriation, but a program or an administrative
system of prioritizing spending; and that the adoption of the DAP was by virtue of the... authority of
the President as the Chief Executive to ensure that laws were faithfully executed.
Main ratio under Sec. 25(5)

3. Unreleased appropriations and withdrawn... unobligated allotments under the DAP... were not
savings, and the use of such... appropriations contravened Section 25(5),... Article VI of the
1987 Constitution.

The management... and utilization of the public wealth inevitably demands a most careful scrutiny of
whether the Executive's implementation of the DAP was consistent with the Constitution, the relevant
GAAs and other existing laws.
a. Although executive discretion... and flexibility are necessary in... the execution of the budget, any...
transfer of appropriated funds... should conform to Section 25(5),... Article VI of the Constitution
The heads of offices, particularly the President, require flexibility in their operations under
performance budgeting to enable them to make whatever adjustments are needed to meet
established work goals under changing conditions.
the power to transfer funds can give the President the flexibility to meet unforeseen events that may
otherwise impede the efficient implementation of the PAPs set by Congress in the GAA.
Congress has traditionally allowed much flexibility to the President in allocating funds pursuant to the
GAAs,[129] particularly when the funds are grouped to form lump sum accounts.
The DAP as a strategy to improve the country's economic... position was one policy that the President
decided to carry out in order to fulfill his mandate under the GAAs.
Denying to the Executive flexibility in the expenditure process would be counterproductive
Were Congress to control expenditures by confining administrators to narrow statutory details, it
would perhaps protect its power of... the purse but it would not protect the purse itself. The realities
and complexities of public policy require executive discretion for the sound management of public
funds.
In contrast, by allowing to the heads of offices some power to transfer funds within their respective
offices, the Constitution itself ensures the fiscal autonomy of their offices, and at the same time
maintains the separation of powers among the three main branches of the
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Government.
In the case of the President, the power to transfer funds from one item to another within the Executive
has not been the mere offshoot of established usage, but has emanated from law itself.
The 1973 Constitution explicitly and categorically prohibited the transfer of funds from one item to
another, unless Congress enacted a law authorizing the President, the Prime Minister, the Speaker,
the Chief Justice of the Supreme Court, and the heads of the Constitutional
Commissions to transfer funds for the purpose of augmenting any item from savings in another item
in the GAA of their respective offices.
was further constricted by the condition that the funds to be transferred should come from... savings
from another item in the appropriation of the office
PD No. 1177, providing in its Section 44
Section 44. Authority to Approve Fund Transfers. The President shall have the authority to transfer
any fund appropriated for the different departments, bureaus, offices and agencies of the Executive
Department which are included in the General
Appropriations Act, to any program, project, or activity of any department, bureau or office included in
the General Appropriations Act or approved after its enactment.
The President shall, likewise, have the authority to augment any appropriation of the Executive
Department in the General Appropriations Act, from savings in the appropriations of another
department, bureau, office or agency within the Executive Branch, pursuant to the... provisions of
Article VIII, Section 16 (5) of the Constitution.
In Demetria v. Alba, however, the Court struck down the first paragraph of Section 44 for
contravening Section 16(5) of the 1973 Constitution
Paragraph 1 of Section 44 of P.D. No. 1177 unduly over-extends the privilege granted under said
Section 16. It empowers the President to indiscriminately transfer funds from one department,
bureau, office or agency of the Executive Department to any program, project... or activity of any
department, bureau or office included in the General Appropriations Act or approved after its
enactment, without regard as to whether or not the funds to be transferred are actually savings in the
item from which the same are to be taken, or whether or not... the transfer is for the purpose of
augmenting the item to which said transfer is to be made. It does not only completely disregard the
standards set in the fundamental law, thereby amounting to an undue delegation of legislative
powers, but likewise goes beyond the tenor... thereof. Indeed, such constitutional infirmities render
the provision in question null and void
It is significant that Demetria was promulgated 25 days after the ratification by the people of the 1987
Constitution, whose Section 25(5) of Article VI is identical to Section 16(5), Article VIII of the 1973
Constitution,... The foregoing history makes it evident that the Constitutional Commission included
Section 25(5), supra, to keep a tight rein on the exercise of the power to transfer funds appropriated
by Congress by the President and the other high officials of the Government named therein.
The only exception is found in Section 25 (5), Article VI of the Constitution, by which the President,
the President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional Commissions are authorized to... transfer
appropriations to augment any item in the GAA for their respective offices from the savings in other
items of their respective appropriations. The plain language of the constitutional restriction leaves no
room for the petitioner's posture, which we should now... dispose of as untenable.
It bears emphasizing that the exception in favor of the high officials named in Section 25(5), Article VI
of the Constitution limiting the authority to transfer savings only to augment another item in the GAA
is strictly but reasonably construed as exclusive.
Accordingly, we should interpret Section 25(5), supra, in the context of a limitation on the President's
discretion over the appropriations during the Budget Execution Phase.
b. Requisites for the valid transfer... of appropriated funds under Section
25(5), Article VI of the 1987
Constitution... b.1. First Requisite GAAs of 2011... and 2012 lacked valid provisions to... authorize
transfers of funds under... the DAP; hence, transfers under the
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DAP were unconstitutional
Section 25(5), supra, not being a self-executing provision of the Constitution, must have an
implementing law for it to be operative.
the GAAs should expressly authorize the... transfer of funds.
Did the GAAs expressly authorize the transfer of funds?
2011 GAA... hereby... authorized to augment any item in this Act from savings in other items of their
respective appropriations.
2012 GAA... hereby... authorized to augment any item in this Act from savings in other items of their
respective appropriations
Even had a valid law authorizing the transfer of funds pursuant to Section 25(5), supra, existed, there
still remained two other requisites to be met, namely: that the source of funds to be transferred were
savings from appropriations within the respective offices; and... that the transfer must be for the
purpose of augmenting an item of appropriation within the respective offices.
b.2. Second Requisite There were... no savings from which funds could... be sourced for the DAP
The petitioners claim that the funds used in the DAP the unreleased appropriations and withdrawn
unobligated allotments were not actual savings within the context of Section 25(5), supra, and the
relevant provisions of the GAAs. Belgica argues that "savings" should be... understood to refer to the
excess money after the items that needed to be funded have been funded, or those that needed to be
paid have been paid pursuant to the budget.[146] The petitioners posit that there could be savings
only when the PAPs for which the... funds had been appropriated were actually implemented and
completed, or finally discontinued or abandoned. They insist that savings could not be realized with
certainty in the middle of the fiscal year; and that the funds for "slow-moving" PAPs could not be
considered as savings... because such PAPs had not actually been abandoned or discontinued yet.
[147] They stress that NBC No. 541, by allowing the withdrawn funds to be reissued to the "original
program or project from which it was withdrawn," conceded that the PAPs from which the... supposed
savings were taken had not been completed, abandoned or discontinu
We partially find for the petitioners.
The first principle is that Congress wields the power of the purse. Congress decides how the budget
will be spent; what PAPs to fund; and the amounts of money to be spent for each PAP
The... second principle is that the Executive, as the department of the Government tasked to enforce
the laws, is expected to faithfully execute the GAA and to spend the budget in accordance with the
provisions of the GAA
The third principle is that in... making the President's power to augment operative under the GAA,
Congress recognizes the need for flexibility in budget execution. In so doing, Congress diminishes its
own power of the purse, for it delegates a fraction of its power to the Executive.
But Congress does not... thereby allow the Executive to override its authority over the purse as to let
the Executive exceed its delegated authority... fourth principle is that savings should be actual.
"Actual" denotes something that is real or substantial, or something that exists... presently in fact, as
opposed to something that is merely theoretical, possible, potential or hypothetical.[150]
The foregoing principles caution us to construe savings strictly against expanding the scope of the
power to augment.
The three instances listed in the GAAs' aforequoted definition were a sure indication that savings
could be generated only upon the purpose of the appropriation being fulfilled, or upon the need for the
appropriation being no longer existent.
The DBM declares that part of the savings brought under the DAP came from "pooling of unreleased
appropriations such as unreleased Personnel Services appropriations which will lapse at the end of
the year, unreleased appropriations of slow moving projects and discontinued... projects per Zero-
Based Budgeting findings."
The declaration of the DBM by itself does not state the clear legal basis for the treatment of
unreleased or unalloted appropriations as savings.

69
The fact alone that the appropriations are unreleased or unalloted is a mere description of the status
of the items as unalloted or... unreleased. They have not yet ripened into categories of items from
which savings can be generated.
Appropriations remain unreleased, for instance, because of noncompliance with documentary
requirements (like the Special
Budget Request), or simply because of the unavailability of funds. But the appropriations do not
actually reach the agencies to which they were allocated under the GAAs, and have remained with
the DBM technically speaking. Ergo, unreleased appropriations refer to... appropriations with
allotments but without disbursement authority.
For us to consider unreleased appropriations as savings, unless these met the statutory definition of
savings, would seriously undercut the congressional power of the purse, because such appropriations
had not even reached and been used by the agency concerned vis-à-vis the PAPs... for which
Congress had allocated them.
Justice Carpio has validly observed in his Separate Concurring Opinion that MOOE appropriations
are deemed divided into twelve monthly allocations within the fiscal year; hence, savings could be
generated monthly from the excess or unused MOOE appropriations other than the
Mandatory Expenditures and Expenditures for Business-type Activities because of the physical
impossibility to obligate and spend such funds as MOOE for a period that already lapsed. Following
this observation, MOOE for future months are not savings and cannot be... transferred.
The petitioners accuse the respondents of forcing the generation of savings in order to have a larger
fund available for discretionary spending. They aver that the respondents, by withdrawing unobligated
allotments in the middle of the fiscal year, in effect deprived funding for
PAPs with existing appropriations under the GAAs
We agree with the petitioners.
Contrary to the respondents' insistence, the withdrawals were upon the initiative of the DBM itself. T
The petitioners assert that no law had authorized the withdrawal and transfer of unobligated
allotments and the pooling of unreleased appropriations; and that the unbridled withdrawal of
unobligated allotments and the retention of appropriated funds were akin to the impoundment... of
appropriations that could be allowed only in case of "unmanageable national government budget
deficit" under the GAAs,[157] thus violating the provisions of the GAAs of 2011, 2012 and 2013
prohibiting the retention or deduction of allotments.
The assertions of the petitioners are upheld
The Executive could not circumvent this provision by declaring unreleased appropriations and
unobligated allotments as savings prior to the end of the fiscal year.
b.3. Third Requisite No funds from... savings could be transferred under... the DAP to augment
deficient items... not provided in the GAA... an appropriation for any PAP must first be determined to
be deficient before it could be augmented from savings. Note is taken of the fact that the 2013 GAA
already made this quite clear, thus:... lthough the OSG rightly contends that the Executive was
authorized to spend in line with its mandate to faithfully execute the laws (which included the GAAs),
such authority did not translate to unfettered discretion that allowed the President to substitute his
own will for... that of Congress.
He was still required to remain faithful to the provisions of the GAAs, given that his power to spend
pursuant to the GAAs was but a delegation to him from Congress. Verily, the power to spend the
public wealth resided in Congress, not in the
Executive.[174] Moreover, leaving the spending power of the Executive unrestricted would threaten to
undo the principle of separation of powers. [175]... b.4 Third Requisite Cross-border... augmentations
from savings were... prohibited by the Constitution
By providing that the President, the President of the Senate, the Speaker of the House of
Representatives, the Chief Justice of the Supreme Court, and the Heads of the Constitutional
Commissions may be authorized to augment any item in the GAA "for their respective offices,"
Section 25(5), supra, has delineated borders between their offices, such that funds appropriated for
one office are prohibited from crossing over to another office even in the guise of augmentation of a
70
deficient item or items. Thus, we call such transfers of funds... cross-border transfers or cross-border
augmentations.
To be sure, the phrase "respective offices" used in Section 25(5), supra, refers to the entire
Executive, with respect to the President; the Senate, with respect to the Senate President; the House
of Representatives, with respect to the Speaker; the Judiciary, with... respect to the Chief Justice; the
Constitutional Commissions, with respect to their respective Chairpersons.
The respondents justified all the cross-border transfers thusly:

99. The Constitution does not prevent the President from transferring savings of his department to
another department upon the latter's request, provided it is the recipient department that uses
such funds to augment its own appropriation. In such a case, the

President merely gives the other department access to public funds but he cannot dictate how they
shall be applied by that department whose fiscal autonomy is guaranteed by the Constitution.
Regardless of the variant characterizations of the cross-border transfers of funds, the plain text of
Section 25(5), supra, disallowing cross-border transfers was disobeyed. Cross-border transfers,
whether as augmentation, or as aid, were prohibited under Section
25(5), supra.

4.

Sourcing the DAP from unprogrammed... funds despite the original revenue targets... not having been
exceeded was invalid
The petitioners point out that a condition for the release of the unprogrammed funds was that the
revenue collections must exceed revenue targets; and that the release of the unprogrammed funds
was illegal because such condition was not met.[191]
The respondents disagree, holding that the release and use of the unprogrammed funds under the
DAP were in accordance with the pertinent provisions of the GAAs. In particular, the DBM avers that
the unprogrammed funds could be availed of when any of the following three instances... occur, to
wit: (1) the revenue collections exceeded the original revenue targets proposed in the BESFs
submitted by the President to Congress; (2) new revenues were collected or realized from sources
not originally considered in the BESFs; or (3) newly-approved loans for... foreign-assisted projects
were secured, or when conditions were triggered for other sources of funds, such as perfected loan
agreements for foreign-assisted projects.[192] This view of the DBM was adopted by all the
respondents in their Consolidated
Comment
We cannot, therefore, subscribe to the respondents' view.

5. Equal protection, checks and balances,... and public accountability challenges

The denial of equal protection of any law should be an issue to be raised only by parties who
supposedly suffer it, and, in these cases, such parties would be the few legislators claimed to have
been discriminated against in the... releases of funds under the DAP. The reason for the requirement
is that only such affected legislators could properly and fully bring to the fore when and how the denial
of equal protection occurred, and explain why there was a denial in their situation. The requirement
was not... met here.
we have already held that the DAP and its implementing issuances were policies and... acts that the
Executive could properly adopt and do in the execution of the GAAs to the extent that they sought to
implement strategies to ramp up or accelerate the economy of the country.

6.

Doctrine of operative fact was applicable

The doctrine of operative fact recognizes the existence of the law or executive act prior to the
determination of its unconstitutionality as an operative fact that produced consequences that cannot
always be erased, ignored or disregarded. In short, it nullifies the void law or... executive act but

71
sustains its effects. It provides an exception to the general rule that a void or unconstitutional law
produces no effect.
In that context, as Justice Brion has clarified, the doctrine of operative fact can apply only to the PAPs
that can no longer be undone, and whose beneficiaries relied in good faith on the validity of the DAP,
but cannot apply to the authors, proponents and implementors of the
DAP, unless there are concrete findings of good faith in their favor by the proper tribunals determining
their criminal, civil, administrative and other liabilities.
Dispositive
WHEREFORE, the Court PARTIALLY GRANTS the petitions for certiorari and prohibition; and
DECLARES the following acts and practices under the Disbursement Acceleration Program, National
Budget Circular No. 541 and related executive issuances
UNCONSTITUTIONAL for being in violation of Section 25(5), Article VI of the 1987 Constitution and
the doctrine of separation of powers, namely:
(a) The withdrawal of unobligated allotments from the implementing agencies, and the declaration of
the withdrawn unobligated allotments and unreleased appropriations as savings prior to the end of
the fiscal year and without complying with the statutory definition of savings... contained in the
General Appropriations Acts;
(b) The cross-border transfers of the savings of the Executive to augment the appropriations of other
offices outside the Executive; and
(c) The funding of projects, activities and programs that were not covered by any appropriation in the
General Appropriations Act.
The Court further DECLARES VOID the use of unprogrammed funds despite the absence of a
certification by the National Treasurer that the revenue collections exceeded the revenue targets for
non-compliance with the conditions provided in the relevant General Appropriations
Acts.
Principles:

1. Overview of the Budget System

The Philippine Budget Cycle

(1) Budget Preparation; (2) Budget Legislation; (3) Budget Execution; and (4) Accountability... c.1.
Budget Preparation
The budget preparation phase is commenced through the issuance of a Budget Call by the DBM
The Budget Call is of two kinds, namely: (1) a National Budget Call, which is addressed to all
agencies, including state universities and colleges; and (2) a Corporate Budget Call, which... is
addressed to all government-owned and -controlled corporations (GOCCs) and government financial
institutions (GFIs)... the various departments and agencies submit their respective Agency Budget
Proposals to the DBM.
DBM bureaus thereafter review the Agency Budget Proposals and come up with recommendations
for the Executive Review Board, comprised by the DBM Secretary and the DBM's senior officials. The
discussions of the Executive Review
Board cover the prioritization of programs and their corresponding support vis-à-vis the priority
agenda of the National Government, and their implementation.
The DBM next consolidates the recommended agency budgets into the National Expenditure
Program (NEP) and a Budget of Expenditures and Sources of Financing (BESF).
NEP provides the details of spending for each department and agency by program, activity... or
project (PAP), and is submitted in the form of a proposed GAA
Once the NEP and the BESF are approved by the President and the Cabinet, the DBM prepares the
budget documents for... submission to Congress.

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The budget documents consist of: (1) the President's Budget Message, through which the President
explains the policy framework and budget priorities; (2) the BESF, mandated by Section 22, Article VII
of the Constitution,[68] which contains the macroeconomic assumptions, public sector context,
breakdown of the expenditures and funding sources for the fiscal year and the two previous years;
and (3) the NEP.
Public or government expenditures are generally classified into two categories,... (1) capital
expenditures or outlays; and (2) current operating expenditures.
Capital expenditures are the expenses whose usefulness lasts for more than one year,... and which
add to the assets of the Government,... Current operating expenditures are the purchases of goods
and services in current... consumption the benefit of which does not extend beyond the fiscal yea
The two components of current expenditures are those for personal services (PS), and those for
maintenance and other operating expense
Public expenditures
(1) economic development expenditures (i.e., expenditures on agriculture and natural resources,
transportation and communications, commerce and industry, and other... economic development
efforts);[71] (2) social services or social development expenditures (i.e., government outlay on
education, public health and medicare, labor and welfare and others);[72] (3) general government
or... general public services expenditures (i.e., expenditures for the general government, legislative
services, the administration of justice, and for pensions and gratuities); [73] (4) national defense
expenditures (i.e., sub-divided... into national security expenditures and expenditures for the
maintenance of peace and order);[74] and (5) public debt.
Public expenditures may further be classified according to the nature of funds, i.e., general fund,
special fund or bond fund... public revenues complement public expenditures and cover all income or
receipts of the government treasury used to support government expenditures
In the Philippines, public revenues are generally derived from the following sources, to wit: (1) tax
revenues (i.e., compulsory contributions to finance government activities);[80] (2) capital revenues
(i.e., proceeds... from sales of fixed capital assets or scrap thereof and public domain, and gains on
such sales like sale of public lands, buildings and other structures, equipment, and other properties
recorded as fixed assets);[81] (3) grants (i.e.,... voluntary contributions and aids given to the
Government for its operation on specific purposes in the form of money and/or materials, and do not
require any monetary commitment on the part of the recipient);[82] (4) extra-ordinary income
(i.e., repayment of loans and advances made by government corporations and local governments and
the receipts and shares in income of the Banko Sentral ng Pilipinas, and other receipts);[83] and (5)
public borrowings (i.e., proceeds of... repayable obligations generally with interest from domestic and
foreign creditors of the Government in general, including the National Government and its political
subdivisions).[84]... c.2. Budget Legislation
The Budget Legislation Phase covers the period commencing from the time Congress receives the
President's Budget, which is inclusive of the NEP and the BESF, up to the President's approval of the
GAA
Budget
Authorization Phase, and involves the significant participation of the Legislative through its
deliberations.
Initially, the President's Budget is assigned to the House of Representatives' Appropriations
Committee on First Reading
Appropriations Committee and its various Sub-Committees schedule and conduct budget hearings to
examine the PAPs of the... departments and agencies.
House of Representatives drafts the General Appropriations Bill (GA
The GAB is sponsored, presented and defended by the House of Representatives' Appropriations
Committee and Sub-Committees in plenary session. As with other laws, the GAB is approved on
Third Reading before the House of Representatives' version is transmitted... to the Senate
The Senate's Finance Committee and its

73
Sub-Committees may submit the proposed amendments to the GAB to the plenary of the Senate only
after the House of Representatives has formally transmitted its version to the Senate. The Senate
version of the GAB is likewise approved on Third Readi
The House of Representatives and the Senate then constitute a panel each to sit in the Bicameral
Conference Committee for the purpose of discussing and harmonizing the conflicting provisions of
their versions of the GAB. The "harmonized" version of the GAB is next... presented to the President
for approv... c.3. Budget Execution
The Budget Execution Phase is primarily the function of the DBM, which is tasked to perform the
following procedures, namely: (1) to issue the programs and guidelines for the... release of funds; (2)
to prepare an Allotment and Cash Release Program; (3) to release allotments; and (4) to issue
disbursement authorities.
Thereafter, the DBM prepares an Allotment Release Program (ARP) and a Cash Release Program
(CRP). The ARP sets a limit for allotments issued in general and to a specific agency. The CRP fixes
the monthly, quarterly and annual disbursement... levels.
Actual disbursement or spending of government funds terminates the Budget Execution Phase and is
usually accomplished through the Modified Disbursement Scheme under wehich disbursements
chargeable against the National Treasury are coursed through the government... servicing banks.
c.4. Accountability
An agency's accountability may be examined and evaluated through (1) performance targets and
outcomes; (2) budget accountability reports; (3) review of agency performance; and (4) audit
conducted by the Commission on Audit (COA).

2.

Nature of the DAP as a fiscal plan... a. DAP was a program designed to... promote economic growth
Administration's "blueprint for public policy" and reflects the Government's goals and... strategies
The Administration would thereby accelerate government spending by: (1) streamlining the
implementation process through the clustering of infrastructure projects... of the Department of Public
Works and Highways (DPWH) and the Department of Education (DepEd), and (2) frontloading PPP-
related projects[107] due for implementation in the following year.[108]
The DAP was a government policy or strategy designed to stimulate the economy through
accelerated spending.
In the context of the DAP's adoption and implementation being a function pertaining to the Executive
as the main actor during the Budget Execution Stage under its... constitutional mandate to faithfully
execute the laws, including the GAAs, Congress did not need to legislate to adopt or to implement the
DAP.
Congress could appropriate but would have nothing more to do during the Budget Execution Stage.
Indeed, appropriation was the... act by which Congress "designates a particular fund, or sets apart a
specified portion of the public revenue or of the money in the public treasury, to be applied to some
general object of governmental expenditure, or to some individual purchase or expense."
'"In a strict sense, appropriation has been defined 'as nothing more than the legislative authorization
prescribed by the Constitution that money may be paid out of the Treasury,' while... appropriation
made by law refers to 'the act of the legislature setting apart or assigning to a particular use a certain
sum to be used in the payment of debt or dues from the State to its creditors.'"
On the other hand, the President, in keeping with his duty to faithfully execute the laws, had sufficient
discretion during the execution of the budget to adapt the budget to changes in the country's
economic situation.
He could adopt a plan like the
DAP for the purpose. He could pool the savings and identify the PAPs to be funded under the DAP.
In such actions, the Executive did not usurp the power vested in Congress under Section 29(1),
Article VI of the Constitution.

74
It is significant that Demetria was promulgated 25 days after the ratification by the people of the 1987
Constitution, whose Section 25(5) of Article VI is identical to Section 16(5), Article VIII of the 1973
Constitution, to wit:
Section 25. x x x... x x x x

5. No law shall be passed authorizing any transfer of appropriations; however, the President, the
President of the Senate, the Speaker of the House of Representatives, the Chief Justice of the
Supreme Court, and the heads of Constitutional Commissions may, by law, be authorized... to
augment any item in the general appropriations law for their respective offices from savings in
other items of their respective appropriations.

Requisites for the valid transfer... of appropriated funds under Section

25(5), Article VI of the 1987
Constitution
The transfer of appropriated funds, to be valid under Section 25(5), supra, must be made upon a
concurrence of the following requisites, namely:
(1) There is a law authorizing the President, the President of the Senate, the Speaker of the House of
Representatives, the Chief Justice of the Supreme Court, and the heads of the Constitutional
Commissions to transfer funds within their respective offices;
(2) The funds to be transferred are savings generated from the appropriations for their respective
offices; and
(3) The purpose of the transfer is to augment an item in the general appropriations law for their
respective offices.
Appropriations have been considered "released" if there has already been an allotment or
authorization to incur obligations and disbursement authority.
According to Philippine Constitution Association v. Enriquez:[159] "Impoundment refers to a refusal
by the President, for whatever reason, to spend funds made available by Congress. It is the failure to
spend or obligate budget authority of any... type." Impoundment under the GAA is understood to
mean the retention or deduction of appropriations. The 2011 GAA authorized impoundment only in
case of unmanageable National Government budget deficit, to wit:
Augmentation implies the existence in this Act of a program, activity, or project with an appropriation,
which upon implementation, or subsequent evaluation of needed resources, is determined to be
deficient. In no case shall a non-existent program,... activity, or project, be funded by augmentation
from savings or by the use of appropriations otherwise authorized in this Act.
It is the President who proposes the budget but it is Congress that has the final say on matters of
appropriations.[180] For this purpose, appropriation involves two governing principles, namely: (1) "a
Principle of the Public Fisc, asserting that all... monies received from whatever source by any part of
the government are public funds;" and (2) "a Principle of Appropriations Control, prohibiting
expenditure of any public money without legislative authorization.

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PROF. MERLIN M. MAGALLONA v. EDUARDO ERMITA, GR No. 187167, 2011-08-16
Facts:
In 1961, Congress passed Republic Act No. 3046... demarcating the maritime baselines of the
Philippines as an archipelagic State.
In March 2009, Congress amended RA 3046 by enacting RA 9522, the statute now under scrutiny.
The change was prompted by the need to make RA 3046 compliant with the terms of the United
Nations Convention on the Law of the Sea (UNCLOS III),... which the
Philippines ratified on 27 February 1984.
Among others, UNCLOS III prescribes the water-land ratio, length, and contour of baselines of
archipelagic States like the Philippines... and sets the deadline for the filing of application... for the
extended continental shelf.
RA 9522 shortened one baseline, optimized the location of some basepoints around the Philippine
archipelago and classified adjacent territories, namely, the Kalayaan Island Group
(KIG) and the Scarborough Shoal, as "regimes of islands" whose islands generate their own
applicable maritime zones.

76
Petitioners, professors of law, law students and a legislator, in their respective capacities... assail the
constitutionality of RA 9522 on two principal grounds, namely: (1) RA 9522 reduces
Philippine maritime territory, and logically, the reach of the Philippine state's sovereign power, in
violation of Article 1 of the 1987 Constitution,... embodying the terms of the Treaty of Paris... and
ancillary... treaties,... and (2) RA 9522 opens the country's waters landward of the baselines to
maritime passage by all vessels and aircrafts, undermining Philippine sovereignty and national
security, contravening the country's nuclear-free policy, and damaging... marine resources, in
violation of relevant constitutional provisions.
In addition, petitioners contend that RA 9522's treatment of the KIG as "regime of islands" not only
results in the loss of a large maritime area but also prejudices the livelihood of subsistence fishermen.
petitioners facially attack RA 9522 for what it excluded and included - its failure to reference either the
Treaty of Paris or Sabah and its use of UNCLOS III's framework of regime of islands to determine the
maritime zones of the KIG and the Scarborough Shoal.
respondents defended RA 9522 as the country's compliance with the terms of UNCLOS III,
preserving Philippine territory over the KIG or Scarborough Shoal. Respondents add that RA 9522
does not... undermine the country's security, environment and economic interests or relinquish the
Philippines' claim over Sabah.
Petitioners submit that RA 9522 "dismembers a large portion of the national territory"... because it
discards the pre-UNCLOS III demarcation of Philippine territory under the Treaty of Paris and related
treaties, successively encoded in the definition of... national territory under the 1935, 1973 and 1987
Constitutions. Petitioners theorize that this constitutional definition trumps any treaty or statutory
provision denying the Philippines sovereign control over waters, beyond the territorial sea recognized
at the time of the
Treaty of Paris, that Spain supposedly ceded to the United States. Petitioners argue that from the
Treaty of Paris' technical description, Philippine sovereignty over territorial waters extends hundreds
of nautical miles around the Philippine archipelago, embracing the... rectangular area delineated in
the Treaty of Paris.
Petitioners next submit that RA 9522's use of UNCLOS III's regime of islands framework to draw the
baselines, and to measure the breadth of the applicable maritime zones of the KIG, "weakens our
territorial claim" over that area.
Petitioners add that... the KIG's (and Scarborough Shoal's) exclusion from the Philippine archipelagic
baselines results in the loss of "about 15,000 square nautical miles of territorial waters," prejudicing
the livelihood of subsistence fishermen.
As their final argument against the validity of RA 9522, petitioners contend that the law
unconstitutionally "converts" internal waters into archipelagic waters, hence subjecting these waters
to the right of innocent and sea lanes passage under UNCLOS III, including overflight.
Petitioners extrapolate that these passage rights indubitably expose Philippine internal waters to
nuclear and maritime pollution hazards, in violation of the Constitution.
Issues:
whether RA 9522 is unconstitutional.
Ruling:
Petitioners' theory fails to persuade us.
UNCLOS III has nothing to do with the acquisition (or loss) of territory. It is a multilateral treaty
regulating,... sea-use rights over maritime zones (i.e., the territorial waters [12 nautical miles from the
baselines], contiguous zone [24 nautical miles from... the baselines], exclusive economic zone [200
nautical miles from the baselines]), and continental shelves that UNCLOS III delimits.
UNCLOS III was the culmination of decades-long negotiations among United Nations members to
codify norms regulating the... conduct of States in the world's oceans and submarine areas,
recognizing coastal and archipelagic States' graduated authority over a limited span of waters and
submarine lands along their coasts.
baselines laws such as RA 9522 are enacted by UNCLOS III States parties to mark-out specific
basepoints along their coasts from which baselines are drawn, either straight or contoured, to serve
as geographic starting points to measure the breadth of the... maritime zones and continental shelf.
Article 48 of UNCLOS III on archipelagic States like ours could not be any clearer:

77
Article 48. Measurement of the breadth of the territorial sea, the contiguous zone, the exclusive
economic zone and the continental shelf. - The breadth of the territorial sea, the contiguous zone, the
exclusive economic zone and the continental shelf shall... be measured from archipelagic baselines
drawn in accordance with article 47. (Emphasis supplied)
Thus, baselines laws are nothing but statutory mechanisms for UNCLOS III States parties to delimit
with precision the extent of their maritime zones and continental shelves. In turn, this gives notice to
the rest of the international community of the scope of the maritime space... and submarine areas
within which States parties exercise treaty-based rights, namely, the exercise of sovereignty over
territorial waters (Article 2), the jurisdiction to enforce customs, fiscal, immigration, and sanitation laws
in the contiguous zone (Article 33), and the right... to exploit the living and non-living resources in the
exclusive economic zone (Article 56) and continental shelf (Article 77).
Even under petitioners' theory that the Philippine territory embraces the islands and all the waters
within the rectangular area delimited in the Treaty of Paris, the baselines of the Philippines would still
have to be drawn in accordance with RA 9522 because this is the... only way to draw the baselines in
conformity with UNCLOS III. The baselines cannot be drawn from the boundaries or other portions of
the rectangular area delineated in the Treaty of Paris, but from the "outermost islands and drying
reefs of the archipelago."
Petitioners' assertion of loss of "about 15,000 square nautical miles of territorial waters" under RA
9522 is similarly unfounded both in fact and law. On the contrary, RA 9522, by optimizing the location
of basepoints, increased the Philippines' total maritime... space (covering its internal waters, territorial
sea and exclusive economic zone) by 145,216 square nautical miles
Extent of maritime area using RA 3046, as amended, taking into account the Treaty of Paris'
delimitation (in square nautical miles)
Extent of maritime area using RA 9522, taking into account UNCLOS III (in square nautical miles)
Internal or archipelagic waters
166,858
171,435
Territorial Sea
274,136
32,106
Exclusive Economic Zone
382,669
TOTAL
440,994
586,210
Thus,... the reach of the exclusive economic zone drawn under RA 9522 even extends way beyond
the waters covered by the rectangular demarcation under the Treaty of Paris. Of course, where there
are overlapping exclusive economic zones of opposite or adjacent
States, there will have to be a delineation of maritime boundaries in accordance with UNCLOS III.
Hence, far from surrendering the Philippines' claim over the KIG and the Scarborough Shoal,
Congress' decision to classify the KIG and the Scarborough Shoal as "`Regime[s] of Islands' under
the Republic of the Philippines consistent with Article 121"... of
UNCLOS III manifests the Philippine State's responsible observance of its pacta sunt servanda
obligation under UNCLOS III. Under Article 121 of UNCLOS III, any "naturally formed area of land,
surrounded by water, which is above water at high tide," such as portions of the
KIG, qualifies under the category of "regime of islands," whose islands generate their own applicable
maritime zones.
The fact of sovereignty, however, does not preclude the operation of municipal and international law
norms subjecting the territorial sea or archipelagic waters to necessary, if not marginal, burdens in the
interest of maintaining unimpeded, expeditious international navigation,... consistent with the
international law principle of freedom of navigation. Thus, domestically, the political branches of the
Philippine government, in the competent discharge of their constitutional powers, may pass legislation
designating routes within the archipelagic waters to... regulate innocent and sea lanes passage.
78
Indeed, bills drawing nautical highways for sea lanes passage are now pending in Congress.
In the absence of municipal legislation, international law norms, now codified in UNCLOS III, operate
to grant innocent passage rights over the territorial sea or archipelagic waters, subject to the treaty's
limitations and conditions for their exercise.
Significantly, the right of innocent passage is a customary international law,[43] thus automatically
incorporated in the corpus of Philippine law.
No modern State can validly invoke its sovereignty to absolutely... forbid innocent passage that is
exercised in accordance with customary international law without risking retaliatory measures from
the international community.
The fact that for archipelagic States, their archipelagic waters are subject to both the right of innocent
passage and sea lanes passage... does not place them in lesser footing vis-à-vis continental coastal
States which are subject, in their... territorial sea, to the right of innocent passage and the right of
transit passage through international straits. The imposition of these passage rights through
archipelagic waters under UNCLOS III was a concession by archipelagic States, in exchange for their
right to claim all... the waters landward of their baselines, regardless of their depth or distance from
the coast, as archipelagic waters subject to their territorial sovereignty. More importantly, the
recognition of archipelagic States' archipelago and the waters enclosed by their... baselines as one
cohesive entity prevents the treatment of their islands as separate islands under UNCLOS III.
Principles:

PROVINCE OF NORTH COTABATO v. GOVERNMENT OF REPUBLIC PEACE PANEL ON

ANCESTRAL DOMAIN, GR No. 183591, 2008-10-14
Facts:
On August 5, 2008, the Government of the Republic of the Philippines (GRP) and the MILF, through
the Chairpersons of their respective peace negotiating panels, were scheduled to sign a
Memorandum of Agreement on the Ancestral Domain (MOA-AD) Aspect of the GRP-MILF Tripoli
Agreement on Peace of 2001 in Kuala Lumpur, Malaysia.
The signing of the MOA-AD between the GRP and the MILF was not to materialize, however, for
upon motion of petitioners, specifically those who filed their cases before the scheduled signing of the
MOA-AD, this Court issued a Temporary Restraining Order enjoining the GRP from... signing the
same.
Towards the end of 1999 up to early 2000, the MILF attacked a number of municipalities in Central
Mindanao and, in March 2000, it took control of the town hall of
Kauswagan, Lanao del Norte.[3] In response, then President Joseph Estrada declared and carried
out an "all-out-war" against the MILF.

79
Formal peace talks between the parties were held in Tripoli, Libya from June 20-22, 2001, the
outcome of which was the GRP-MILF Tripoli Agreement on Peace (Tripoli Agreement 2001)
containing the basic principles and agenda on the following aspects of the negotiation:
Security Aspect, Rehabilitation Aspect, and Ancestral Domain Aspect. With regard to the Ancestral
Domain Aspect, the parties in Tripoli Agreement 2001 simply agreed "that the same be discussed
further by the Parties in their next meeting."
In 2005, several exploratory talks were held between the parties in Kuala Lumpur, eventually leading
to the crafting of the draft MOA-AD in its final form, which, as mentioned, was set to be signed last
August 5, 2008.
On August 19, 2008, Ernesto Maceda, Jejomar Binay, and Aquilino Pimentel III filed a petition for
Prohibition,... praying for a judgment prohibiting and permanently enjoining respondents from formally
signing and... executing the MOA-AD and or any other agreement derived therefrom or similar
thereto, and nullifying the MOA-AD for being unconstitutional and illegal. Petitioners herein
additionally implead as respondent the MILF Peace Negotiating Panel represented by its Chairman
Mohagher
Iqbal.
Issues:
Whether the petitions have become moot and academic
(i) insofar as the mandamus aspect is concerned, in view of the disclosure of official copies of the
final draft of the Memorandum of Agreement (MOA); and
(ii) insofar as the prohibition aspect involving the Local Government Units is concerned, if it is
considered that consultation has become fait accompli with the finalization of the draft
Whether the constitutionality and the legality of the MOA is ripe for adjudication
W... hether respondent Government of the Republic of the Philippines Peace Panel committed grave
abuse of discretion amounting to lack or excess of jurisdiction when it negotiated and initiated the
MOA vis-à-vis ISSUES Nos. 4 and 5
Whether there is a violation of the people's right to information on matters of public concern (1987
Constitution, Article III, Sec. 7) under a state policy of full disclosure of all its transactions involving
public interest (1987 Constitution, Article II, Sec. 28)... including public consultation under Republic
Act No. 7160 (LOCAL GOVERNMENT CODE OF 1991)
If it is in the affirmative, whether prohibition under Rule 65 of the 1997 Rules of Civil Procedure is an
appropriate remedy
Whether by signing the MOA, the Government of the Republic of the Philippines would be BINDING
itself... a) to create and recognize the Bangsamoro Juridical Entity (BJE) as a separate state, or a
juridical, territorial or political subdivision not recognized by law;... b) to revise or amend the
Constitution and existing laws to conform to the MOA;... c) to concede to or recognize the claim of the
Moro Islamic Liberation Front for ancestral domain in violation of Republic Act No. 8371 (THE
INDIGENOUS PEOPLES RIGHTS ACT OF 1997), particularly Section 3(g) & Chapter VII
(DELINEATION, RECOGNITION OF ANCESTRAL
DOMAINS)
If in the affirmative, whether the Executive Branch has the authority to so bind the Government of the
Republic of the Philippines
Whether the inclusion/exclusion of the Province of North Cotabato, Cities of Zamboanga, Iligan and
Isabela, and the Municipality of Linamon, Lanao del Norte in/from the areas covered by the projected
Bangsamoro Homeland is a justiciable question... hether desistance from signing the MOA derogates
any prior valid commitments of the Government of the Republic of the Philippines.
Wh
Ruling:
In general, the objections against the MOA-AD center on the extent of the powers conceded therein
to the BJE.

80
right to self-determination of a people is normally fulfilled through internal self-determination - a
people's pursuit of its political, economic, social and cultural development within the framework... of
an existing state. A right to external self-determination... arises in only the most extreme of cases
and, even then, under carefully defined circumstances.
External self-determination can be defined as in the following statement from the Declaration on
Friendly Relations, supra
One, E.O. No. 3 itself is replete with mechanics for continuing consultations on both national and local
levels and for a principal forum for consensus-building. In fact, it is the duty of the Presidential Adviser
on the Peace Process to conduct regular dialogues to seek... relevant information, comments, advice,
and recommendations from peace partners and concerned sectors of society.
Two, Republic Act No. 7160 or the Local Government Code of 1991 requires all national offices to
conduct consultations before any project or program critical to the environment and human ecology
including those that may call for the eviction of a particular group of... people residing in such locality,
is implemented therein. The MOA-AD is one peculiar program that unequivocally and unilaterally
vests ownership of a vast territory to the Bangsamoro people, which could pervasively and drastically
result to the diaspora or displacement of a... great number of inhabitants from their total environment.
Three, Republic Act No. 8371 or the Indigenous Peoples Rights Act of 1997 provides for clear-cut
procedure for the recognition and delineation of ancestral domain, which entails, among other things,
the observance of the free and prior informed consent of the Indigenous
Cultural Communities/Indigenous Peoples. Notably, the statute does not grant the Executive
Department or any government agency the power to delineate and recognize an ancestral domain
claim by mere agreement or compromise.
The MOA-AD cannot be reconciled with the present Constitution and laws. Not only its specific
provisions but the very concept underlying them, namely, the associative relationship envisioned
between the GRP and the BJE, are unconstitutional , for the concept... presupposes that the
associated entity is a state and implies that the same is on its way to independence.
While there is a clause in the MOA-AD stating that the provisions thereof inconsistent with the present
legal framework will not be effective until that framework is amended, the same does not cure its
defect. The inclusion of provisions in the MOA-AD establishing an associative... relationship between
the BJE and the Central Government is, itself, a violation of the Memorandum of Instructions From
The President dated March 1, 2001, addressed to the government peace panel. Moreover, as the
clause is worded, it virtually guarantees that the necessary... amendments to the Constitution and the
laws will eventually be put in place. Neither the GRP Peace Panel nor the President herself is
authorized to make such a guarantee. Upholding such an act would amount to authorizing a
usurpation of the constituent powers vested only in
Congress, a Constitutional Convention, or the people themselves through the process of initiative, for
the only way that the Executive can ensure the outcome of the amendment process is through an
undue influence or interference with that process.
While the MOA-AD would not amount to an international agreement or unilateral declaration binding
on the Philippines under international law, respondents' act of guaranteeing amendments is, by itself,
already a constitutional violation that renders the MOA-AD fatally... defective.
WHEREFORE, respondents' motion to dismiss is DENIED. The main and intervening petitions are
GIVEN DUE COURSE and hereby GRANTED.
Principles:
Under the heading "Terms of Reference" (TOR), the MOA-AD includes not only four earlier
agreements between the GRP and MILF, but also two agreements between the GRP and the MNLF:
the 1976 Tripoli Agreement, and the Final Peace Agreement on the Implementation of the 1976
Tripoli
Agreement, signed on September 2, 1996 during the administration of President Fidel Ramos.
`Bangsamoros.'" It defines "
"Bangsamoro people" as the natives or original inhabitants of Mindanao and its... adjacent islands
including Palawan and the Sulu archipelago at the time of conquest or colonization, and their
descendants whether mixed or of full blood, including their spouses.
81
Thus, the concept of "Bangsamoro," as defined in this strand of the MOA-AD, includes not only
"Moros" as traditionally understood even by Muslims,[31] but all indigenous peoples of Mindanao and
its adjacent islands.
The Bangsamoro people are acknowledged as having the right to self-governance, which right is said
to be rooted on ancestral territoriality exercised originally under the suzerain authority of their
sultanates and the Pat a Pangampong ku Ranaw.

G.R. No. L-26379 December 27, 1969

WILLIAM C. REAGAN, ET. AL vs.
COMMISSIONER OF INTERNAL REVENUE

FACTS:
Petitioner Reagan, a civilian employee of an American corporation providing technical assistance to
the US Air Force in the Philippines, questioned the payment of the income tax assessed on him by
respondent CIR on an amount realized by him on a sale of his automobile to a member of the US
Marine Corps, the transaction having taken place at the Clark Field Air Base at Pampanga. It is his
contention, that in legal contemplation the sale was made outside Philippine territory and therefore
beyond our jurisdictional power to tax. He seeks that an amount of P2,979.00 as the income tax paid
by him be refunded.

ISSUE: WON the Clark Field Air Base is a foreign property therefore excluded from the power of
Philippine taxation.

HELD: NO.
By the [Military Bases] Agreement, it should be noted, the Philippine Government merely consents
that the United States exercise jurisdiction in certain cases. The consent was given purely as a matter
of comity, courtesy, or expediency over the bases as part of the Philippine territory or divested itself
82
completely of jurisdiction over offenses committed therein. This provision is not and can not on
principle or authority be construed as a limitation upon the rights of the Philippine Government.

The State is not precluded from allowing another power to participate in the exercise of jurisdictional
right over certain portions of its territory. If it does so, it by no means follows that such areas become
impressed with an alien character. They retain their status as native soil. They are still subject to its
authority. Its jurisdiction may be diminished, but it does not disappear. So it is with the bases under
lease to the American armed forces by virtue of the military bases agreement of 1947. They are not
and cannot be foreign territory.

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
LORETA GOZO, defendant-appellant.

53 SCRA 476
OCTOBER 26, 1973

FACTS:

Loreta Gozo bought a house and lot located inside the US Naval Reservation within the territorial
jurisdiction of Olangapo City. She demolished the house and built another one in its place without
securing a building permit from the City Mayor of Olangapo City. The City Court of Olangapo found
her guilty of violating a municipal ordinance that requires permit from the municipal mayor for
construction of building as well as any modification, repairs or demolition thereof.

On appeal with the Court of Appeals, Gozo put in issue the validity of such ordinance by invoking due
process. She likewise questioned the applicability of the ordinance to her in view of the location of her
dwelling within the naval base leased to the American Armed Forces; she contended that the
municipal government could not exercise therein-administrative jurisdiction.

83
ISSUES:

Whether municipal ordinance is valid?

Whether the municipal corporation retains its administrative jurisdiction over the area where Gozo‘s
house was located?

HELD:

YES, the municipal ordinance is valid. The authority to require building permits is predicated upon the
general welfare clause. Its scope is wide, well nigh all embracing, covering every aspect of public
health, public morals, public safety, and the well-being and good order of the community.

YES, the municipal corporation retains its administrative jurisdiction over the said area. By the
agreement, the Philippine Government merely consents that the United States exercise jurisdiction in
certain cases. This consent was given purely as a matter of comity, courtesy or expediency. The
Philippine Government has not abdicated its sovereignty over the bases as part of the Philippine
territory or divested itself completely of jurisdiction over offenses committed therein. Under the terms
of the treaty, the United States Government has prior or preferential but not exclusive jurisdiction of
such offenses. The Philippine jurisdiction retains not only jurisdictional rights not granted, but also
such ceded rights as the United States Military authorities for reasons of their own decline to make
use of.

Moreover, the concept of sovereignty as auto-limitation is the property of a state force due to which it
has the exclusive capacity of legal self-determination and self-restriction. x x x A state is not
precluded from allowing another power to participate in the exercise of jurisdictional right over certain
portions of its territory. If it does so, it by no means follows that such areas become impressed with an
alien character. They retain their status as native soil. They are still subject to its authority. Its
jurisdiction may be dismissed, but it does not disappear. Therefore, it is with the bases under lease to
the American armed forces by virtue of the military bases agreement of 1947. They are not and
cannot be foreign territory.

Lee v. Director of Lands (G.R. No. 128195) Case Digest

Posted byPingSeptember 24, 2018Posted inUncategorizedTags:Law Notes
Lee v. Director of Lands
G.R. No. 128195
October 3, 2001

Facts:
· March 1936
o Rafael, Carmen, et al., all surnamed Dinglasan, sold to Chinese citizen Lee Liong a parcel of land
situated at Roxas City.
· 1948
o the former owners filed an annulment of sale and recovery of land
o Reason: The Constitution prohibits against aliens owning private lands
o Ruling of Supreme Court: Sale is null and void but the original owners can’t have the title because
they also violated the Constitution. They are in pari delicto.
· 1993
o Filipino citizens Elizabeth Manuel-Lee and Pacita Yu-Lee, who are the widows of the sons of Lee
Liong, filed a petition for reconstitution. Both Elizabeth and Pacita acquired the land from their
husbands.

84
  They alleged that on December 9, 1948, a certification of a transfer title over the
property was issued in the name of Lee Liong but was burned during the war. However,
Elizabeth and Pacita did not show an evidence of owner’s duplicate copy.

o Ruling of the RTC: Order of reconstitution is granted.

· 1995
o Solicitor General filed for a petition of judgment in the reconstitution case
o Reason: RTC Roxas had no jurisdiction over the case
o Contention: Petitioners are not the proper party because Lee Liong did not acquire the title of the
land because he is Chinese
 Ruling of the CA: Reconstitution judgment is void.

Issues:
1. Who was the proper party to assail the legality of the sale?
2. Was the Solicitor General estopped because he filed the case 60 years after?
3. Can the Solicitor General escheat the estate now that the land is owned by Filipinos?
4. Was the reconstitution valid?

Ruling:
1. The Solicitor General is the proper party to assail the legality of the sale. Both vendor and
vendee are in pari delicto for violating the Constitution, and the courts will not afford protection to
either party.
2. No. The SolGen is not estopped because prescription never lies against the State.
3. No. The land is now in the hands of Filipinos. If the land was invalidly transferred to an alien who
subsequently becomes a citizen or transfers it to a citizen, the flaw in the original transaction is
considered cured and the title of the transferee is valid.
4. No. The petitioners failed to present the owner’s duplicate of the title. The order of restitution is
void for lack of factual support.

REPUBLIC v. CHULE Y. LIM, GR No. 153883, 2004-01-13

Facts:
She need not elect Filipino citizenship as she is an illegitimate child of an alien father and a
Filipino mother, to which the child shall follow the citizenship of the mother (double check
legal basis)
464 Phil. 151... a petition for correction of entries under Rule 108 of the Rules of Court filed by
respondent Chule Y. Lim with the Regional Trial Court of Lanao del Norte, Branch 4,... docketed as
Sp. Proc. No. 4933.
respondent claimed that she was born on October 29, 1954 in Buru-an, Iligan City. Her birth was
registered in Kauswagan, Lanao del Norte but the Municipal Civil Registrar of Kauswagan transferred
her record of birth to Iligan City. She alleged that... both her Kauswagan and Iligan City records of
birth have four erroneous entries, and prays that they be corrected.
Third, her nationality was entered as Chinese when it should have been Filipino considering that her
father and mother never got married. Only her deceased father was Chinese, while her mother is
Filipina. She claims that her being a registered voter attests to the... fact that she is a Filipino citizen.
The Republic of the Philippines appealed the decision to the Court of Appeals
85
THE COURT OF APPEALS ERRED IN ORDERING THE CORRECTION OF THE CITIZENSHIP OF
RESPONDENT CHULE Y. LIM FROM "CHINESE" TO "FILIPINO" DESPITE THE FACT THAT
RESPONDENT NEVER DEMONSTRATED ANY COMPLIANCE WITH THE LEGAL
REQUIREMENTS FOR ELECTION OF CITIZENSHIP.
II
THE COURT OF APPEALS ERRED IN ALLOWING RESPONDENT TO CONTINUE USING HER
FATHER'S SURNAME DESPITE ITS FINDING THAT RESPONDENT IS AN ILLEGITIMATE CHILD
Instead, in its first assignment of error, the Republic avers that respondent did not comply with the
constitutional requirement of electing Filipino citizenship when she reached the age of majority.
It cites Article IV, Section 1(3) of the 1935 Constitution, which... provides that the citizenship of a
legitimate child born of a Filipino mother and an alien father followed the citizenship of the father,
unless, upon reaching the age of majority, the child elected Philippine citizenship.
Plainly, the above constitutional and statutory requirements of electing Filipino citizenship apply only
to legitimate children. These do not apply in the case of respondent who was concededly an
illegitimate child, considering that her Chinese father and Filipino... mother were never married. As
such, she was not required to comply with said constitutional and statutory requirements to become a
Filipino citizen. By being an illegitimate child of a Filipino mother, respondent automatically became a
Filipino upon birth.
Stated differently, she is a Filipino since birth without having to elect Filipino citizenship when she
reached the age of majority.
This notwithstanding, the records show that respondent elected Filipino citizenship when she reached
the age of majority. She registered as a voter in Misamis Oriental when she was 18 years old.[14]
The exercise of the right of suffrage and the... participation in election exercises constitute a positive
act of election of Philippine citizenship.[
Issues:
The Republic's submission is misleading. The Court of Appeals did not allow respondent to use her
father's surname. What it did allow was the correction of her father's misspelled surname which she
has been using ever since she can remember. In this regard,... respondent does not need a court
pronouncement for her to use her father's surname.
Ruling:
Trial Court Ruling
WHEREFORE, the foregoing premises considered, to set the records of the petitioner straight and in
their proper perspective, the petition is granted
Supreme Court concurs with the CA
We agree with the Court of Appeals when it held:
Firstly, Petitioner-appellee is now 47 years old. To bar her at this time from using her father's
surname which she has used for four decades without any known objection from anybody, would only
sow confusion. Concededly, one of the reasons allowed... for changing one's name or surname is to
avoid confusion.
Secondly, under Sec. 1 of Commonwealth Act No. 142, the law regulating the use of aliases, a
person is allowed to use a name "by which he has been known since childhood."
Thirdly, the Supreme Court has already addressed the same issue. In Pabellar v. Rep. of the Phils.,
[16] we held:
Section 1 of Commonwealth Act No. 142, which regulates the use of aliases, allows a person to use a
name "by which he has been known since childhood" (Lim Hok Albano v. Republic, 104 Phil. 795;
People v. Uy Jui Pio, 102 Phil. 679; Republic v. Tañada, infra).
Even legitimate children cannot enjoin the illegitimate children of their father from using his surname
(De Valencia v. Rodriguez, 84 Phil. 222).[17]
WHEREFORE, in view of the foregoing, the instant petition for review is DENIED. The decision of the
Court of Appeals in CA-G.R. CV No. 68893 dated May 29, 2002, is AFFIRMED.
86
Principles:
Article IV, Section 1(3)
By being an illegitimate child of a Filipino mother, respondent automatically became a Filipino upon
birth.
Stated differently, she is a Filipino since birth without having to elect Filipino citizenship when she
reached the age of majority.
While judicial authority is required for a change of name or surname,[18] there is no such requirement
for the continued use of a surname which a person has already been using since childhood.

AASJS MEMBER - HECTOR GUMANGAN CALILUNG v. SIMEON DATUMANONG, GR No. 160869,

2007-05-11
Facts:
Petitioner filed the instant petition against respondent, then Secretary of Justice Simeon
Datumanong, the official tasked to implement laws governing citizenship.
Petitioner prays that a writ of prohibition be issued to stop respondent from... implementing Republic
Act No. 9225, entitled "An Act Making the Citizenship of Philippine Citizens Who Acquire Foreign
Citizenship Permanent,... Petitioner prays that a writ of prohibition be issued to stop respondent
from... implementing Republic Act No. 9225, entitled "An Act Making the Citizenship of Philippine
Citizens Who Acquire Foreign Citizenship Perman
Petitioner prays that a writ of prohibition be issued to stop respondent from... implementing Republic
Act No. 9225, entitled "An Act Making the Citizenship of Philippine Citizens Who Acquire Foreign
Citizenship Permanent,... Petitioner avers that Rep. Act No.
9225 is unconstitutional as it violates Section 5, Article IV of the 1987 Constitution that states, "Dual
allegiance of citizens is inimical to the national interest and shall be dealt with by law.
Rep. Act No. 9225,... SEC. 2. Declaration of Policy... all Philippine citizens who become citizens of
another country shall be deemed not to have lost their Philippine citizenship under the conditions of
this Act
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.-It is hereby declared the policy of the State that all Philippine citizens who become citizens of
another country shall be deemed not to have lost their Philippine citizenship under the conditions of
this Act.
SEC. 3. Retention of Philippine Citizenship.-Any provision of law to the contrary notwithstanding,
natural-born citizens of the Philippines who have lost their Philippine citizenship by reason of their
naturalization as citizens of a foreign country are hereby deemed to... have reacquired Philippine
citizenship upon taking the following oath of allegiance to the Republic:
Petitioner contends that Rep. Act No. 9225 cheapens Philippine citizenship.
He avers that Sections 2 and 3 of Rep. Act No. 9225, together, allow dual allegiance and not dual
citizenship. Petitioner maintains that Section 2 allows all Filipinos, either natural-born or... naturalized,
who become foreign citizens, to retain their Philippine citizenship without losing their foreign
citizenship.
Section 3 permits dual allegiance because said law allows natural-born citizens of the Philippines to
regain their Philippine citizenship by simply... taking an oath of allegiance without forfeiting their
foreign allegiance.
The Office of the Solicitor General (OSG) claims that Section 2 merely declares as a state policy that
"Philippine citizens who become citizens of another country shall be deemed not to have lost their
Philippine citizenship.
The OSG further claims that the oath in Section 3... does not allow dual allegiance since the oath
taken by the former Filipino citizen is an effective renunciation and repudiation of his foreign
citizenship.
The fact that the applicant taking the oath recognizes and accepts the supreme authority of the
Philippines is an... unmistakable and categorical affirmation of his undivided loyalty to the Republic.
Petitioner likewise advances the proposition that although Congress has not yet passed any law on
the matter of dual allegiance, such absence of a law should not be justification why this Court could
not rule on the issue. He further contends that while it is true that... there is no enabling law yet on
dual allegiance, the Supreme Court, through Mercado v. Manzano,[6] already had drawn up the
guidelines on how to distinguish dual allegiance from dual citizenship.
Issues:
Is Rep. Act No. 9225 unconstitutional?
Does this Court have jurisdiction to pass upon the issue of dual allegiance?... whether Rep. Act No.
9225 would allow dual allegiance
Ruling:
Rep. Dilangalen noted... that under the Constitution, dual allegiance is inimical to public interest. He
thereafter asked whether with the creation of dual allegiance by reason of retention of foreign
citizenship and the reacquisition of Philippine citizenship, there will now be a violation of the
Constitution
Rep. Locsin underscored that... the proposed law aims to facilitate the reacquisition of Philippine
citizenship by speedy means. However, he said... that in one sense, it addresses the problem of dual
citizenship by requiring the taking of an oath. He explained that the problem of dual citizenship is
transferred from the Philippines to the foreign country because the latest oath that will be taken by the
former
Filipino is one of allegiance to the Philippines and not to the United States, as the case may be.
Since the measure now requires this oath, the problem of dual allegiance is transferred from the
Philippines to the foreign country... concerned
Rep. Locsin clarified that by swearing to the supreme authority of the Republic, the person implicitly
renounces his foreign citizenship.
Rep. Locsin further pointed out that the problem of dual allegiance is created wherein a natural-born
citizen of the Philippines takes an oath of allegiance to another country and in that oath says that he
abjures and absolutely renounces all allegiance to his country of origin... and swears allegiance to
that foreign country.
In the present measure, he clarified, a person is required to take an oath and the last he utters is one
of allegiance to the country. He then... said that the problem of dual allegiance is no longer the
problem of the Philippines but of the other foreign country.
From the above excerpts of the legislative record, it is clear that the intent of the legislature in drafting
Rep. Act No. 9225 is to do away with the provision in Commonwealth Act No. 63[5] which takes away
Philippine citizenship from natural-born
Filipinos who become naturalized citizens of other countries.
On its face, it... does not recognize dual allegiance. By swearing to the supreme authority of the
Republic, the person implicitly renounces his foreign citizenship.

88
the OSG counters that pursuant to Section 5, Article IV of the 1987 Constitution, dual allegiance shall
be dealt with by law. Thus, until a law on dual allegiance is enacted by Congress, the Supreme Court
is without any jurisdiction to entertain issues regarding... dual allegiance.
In Sections 2 and 3 of Rep. Act No. 9225, the framers were not concerned... with dual citizenship per
se, but with the status of naturalized citizens who maintain their allegiance to their countries of origin
even after their naturalization.
Petitioner misreads Mercado. That case did not set the parameters of what constitutes dual...
allegiance but merely made a distinction between dual allegiance and dual citizenship.
WHEREFORE, the petition is hereby DISMISSED for lack of merit.
Principles:
Section 5, Article IV of the 1987 Constitution, dual allegiance shall be dealt with by law. Thus, until a
law on dual allegiance is enacted by Congress, the Supreme Court is without any jurisdiction to
entertain issues regarding... dual allegiance.
Section 5, Article IV of the Constitution is a declaration of a policy and it is not a self-executing
provision.
Congress was given a mandate to draft a law that would set specific parameters of... what really
constitutes dual allegiance.[10] Until this is done, it would be premature for the judicial department,
including this Court, to rule on issues pertaining to dual allegiance.
in Estrada v. Sandiganbayan,[11] we said that the courts must assume that the legislature is ever
conscious of the borders and edges of its plenary powers, and passed laws with full knowledge of the
facts and for the purpose of promoting... what is right and advancing the welfare of the majority.
Hence, in determining whether the acts of the legislature are in tune with the fundamental law, we
must proceed with judicial restraint and act with caution and forbearance.[12] The... doctrine of
separation of powers demands no less. We cannot arrogate the duty of setting the parameters of
what constitutes dual allegiance when the Constitution itself has clearly delegated the duty of
determining what acts constitute dual allegiance for study and... legislation by Congress.

REPUBLIC v. NORA FE SAGUN, GR No. 187567, 2012-02-15

Facts:
petition for review on certiorari filed by the Solicitor General on behalf of the Republic of the
Philippines, seeking the reversal of the April 3, 2009 Decision[1] of the Regional Trial Court (RTC),
Branch 3, of Baguio
City in Spcl. Pro. Case No. 17-R. The RTC granted the petition[2] filed by respondent Nora Fe Sagun
entitled "In re: Judicial Declaration of Election of Filipino Citizenship, Nora Fe Sagun v. The Local Civil
Registrar of Baguio City."
Respondent is the legitimate child of Albert S. Chan, a Chinese national, and Marta Borromeo, a
Filipino citizen. She was born on August 8, 1959 in Baguio City[3] and did not elect Philippine
citizenship upon reaching the age of majority.
In 1992, at the age of 33 and after getting married to Alex Sagun, she executed an Oath of
Allegiance[4] to the Republic of the Philippines. Said document was notarized by Atty. Cristeta Leung
on December 17, 1992, but was not recorded and registered... with the Local Civil Registrar of Baguio
City.

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Sometime in September 2005, respondent applied for a Philippine passport. Her application was
denied due to the citizenship of her father and there being no annotation on her birth certificate that
she has elected Philippine citizenship. Consequently, she sought a... judicial declaration of her
election of Philippine citizenship and prayed that the Local Civil Registrar of Baguio City be ordered to
annotate the same on her birth certificate.
She asserted that by virtue of her positive acts, she has effectively elected Philippine citizenship and
such fact should be annotated on her record of birth so as to entitle her to the issuance of a Philippine
passport.
Issues:
Petitioner raises the following issues:
I
Whether or not an action or proceeding for judicial declaration of Philippine citizenship is procedurally
and jurisdictionally permissible; and,... II
Whether or not an election of Philippine citizenship, made twelve (12) years after reaching the age of
majority, is considered to have been made "within a reasonable time" as interpreted by jurisprudence.
issues for our resolution are: (1) whether respondent's petition for declaration of election of Philippine
citizenship is sanctioned by the Rules of Court and jurisprudence; (2) whether respondent has
effectively elected Philippine citizenship in... accordance with the procedure prescribed by law.
Ruling:
After conducting a hearing, the trial court rendered the assailed Decision on April 3, 2009 granting the
petition and declaring respondent a Filipino citizen. The fallo of the decision reads:
WHEREFORE, the instant petition is hereby GRANTED. Petitioner Nora Fe Sagun y Chan is hereby
DECLARED [a] FILIPINO CITIZEN, having chosen or elected Filipino citizenship.
Upon payment of the required fees, the Local Civil Registrar of Baguio City is hereby directed to
annotate [on] her birth certificate, this judicial declaration of Filipino citizenship of said petitioner.
WHEREFORE, the petition is GRANTED. The Decision dated April 3, 2009 of the Regional Trial
Court, Branch 3 of Baguio City in Spcl. Pro. Case No. 17-R is REVERSED and SET ASIDE. The
petition for judicial declaration of election of Philippine... citizenship filed by respondent Nora Fe
Sagun is hereby DISMISSED for lack of merit.
Principles:
Under our laws, there can be no action or proceeding for the judicial declaration of the citizenship of
an individual. Courts of justice exist for settlement of justiciable controversies, which imply a given
right, legally demandable and enforceable, an act or... omission violative of said right, and a remedy,
granted or sanctioned by law, for said breach of right. As an incident only of the adjudication of the
rights of the parties to a controversy, the court may pass upon, and make a pronouncement relative
to their status.
Otherwise, such a pronouncement is beyond judicial power.
it was erroneous for the trial court to make a specific declaration of respondent's Filipino citizenship
as such pronouncement was not within the court's competence.
As to the propriety of respondent's petition seeking a judicial declaration of election of Philippine
citizenship, it is imperative that we determine whether respondent is required under the law to make
an election and if so, whether she has complied with the procedural... requirements in the election of
Philippine citizenship.
Under Article IV, Section 1(4) of the 1935 Constitution, the citizenship of a legitimate child born of a
Filipino mother and an alien father followed the citizenship of the father, unless, upon reaching the
age of majority, the child elected Philippine citizenship.
The right to elect Philippine citizenship was recognized in the 1973 Constitution when it provided that
"[t]hose who elect Philippine citizenship pursuant to the provisions of the Constitution of nineteen
hundred and thirty-five" are citizens of the

90
Philippines.[17] Likewise, this recognition by the 1973 Constitution was carried over to the 1987
Constitution which states that "[t]hose born before January 17, 1973 of Filipino mothers, who elect
Philippine citizenship upon reaching the age... of majority" are Philippine citizens.[18] It should be
noted, however, that the 1973 and 1987 Constitutional provisions on the election of Philippine
citizenship should not be understood as having a curative effect on any irregularity in the acquisition
of... citizenship for those covered by the 1935 Constitution. If the citizenship of a person was subject
to challenge under the old charter, it remains subject to challenge under the new charter even if the
judicial challenge had not been commenced before the effectivity of the... new Constitution.
Commonwealth Act (C.A.) No. 625,[22] enacted pursuant to Section 1(4), Article IV of the 1935
Constitution, prescribes the procedure that should be followed in order to make a valid election of
Philippine citizenship, to wit:
Section 1. The option to elect Philippine citizenship in accordance with subsection (4), [S]ection 1,
Article IV, of the Constitution shall be expressed in a statement to be signed and sworn to by the
party concerned before any officer authorized to administer... oaths, and shall be filed with the
nearest civil registry. The said party shall accompany the aforesaid statement with the oath of
allegiance to the Constitution and the Government of the Philippines.
Based on the foregoing, the statutory formalities of electing Philippine citizenship are: (1) a statement
of election under oath; (2) an oath of allegiance to the Constitution and Government of the
Philippines; and (3) registration of the statement of election and of the oath... with the nearest civil
registry... no election of Philippine citizenship shall be accepted for registration under C.A. No. 625
unless the party exercising the right of election has complied with the requirements of the Alien
Registration Act of 1950. In other words, he should first... be required to register as an alien.[24]
Pertinently, the person electing Philippine citizenship is required to file a petition with the Commission
of Immigration and Deportation (now Bureau of Immigration) for the cancellation of his alien...
certificate of registration based on his aforesaid election of Philippine citizenship and said Office will
initially decide, based on the evidence presented the validity or invalidity of said election.[25]
Afterwards, the same is elevated to the
Ministry (now Department) of Justice for final determination and review.
As aptly pointed out by the petitioner, even assuming arguendo that respondent's oath of allegiance
suffices, its execution was not within a reasonable time after respondent attained the age of majority
and was... not registered with the nearest civil registry as required under Section 1 of C.A. No. 625.
The phrase "reasonable time" has been interpreted to mean that the election should be made
generally within three (3) years from reaching the age of majority.
The mere exercise of suffrage, continuous and uninterrupted stay in the Philippines, and other similar
acts showing exercise of
Philippine citizenship cannot take the place of election of Philippine citizenship

BAR MATTER NO. 914

Posted by kaye lee on 11:00 PM
Bar Matter No. 914, October 1, 1999
Re: Application for Admission to the Philippine Bar
vs.
Vicente D. Ching, petitioner

Facts:

Vicente D. Ching, a legitimate child of a Filipino mother and an alien Chinese father, was born on
April 11, 1964 in Tubao La Union, under the 1935 Constitution. He has resided in the Philippines

He completed his Bachelor of Laws at SLU in Baguio on July 1998, filed an application to take the
1998 Bar Examination.
The Resolution in this Court, he was allowed to take the bar if he submit to the Court the following
documents as proof of his Philippine Citizenship:
1. Certification issued by the PRC Board of Accountancy that Ching is a certified accountant;

91
 2. Voter Certification issued COMELEC in Tubao La Union showing that Ching is a registered voter
of his place; and
3. Certification showing that Ching was elected as member of the Sangguniang Bayan of Tubao, La
Union
On April 5, 1999, Ching was one of the bar passers. The oath taking ceremony was scheduled on
May 5, 1999.
Because of his questionable status of Ching's citizenship, he was not allowed to take oath.
He was required to submit further proof of his citizenship.
The Office of the Solicitor General was required to file a comment on Ching's petition for admission
to the Philippine Bar.
In his report:
1. Ching, under the 1935 Constitution, was a Chinese citizen and continue to be so, unless upon
reaching the age of majority he elected Philippine citizenship, under the compliance with the
provisions of Commonwealth Act No. 265 "an act providing for the manner in which the option to elect
Philippine citizenship shall be declared by a person whose mother is a Filipino citizen"
2. He pointed out the Ching has not formally elected Philippine citizenship, and if ever he does, it
would already be beyond the "reasonable time" allowed by the present jurisprudence.

Issue:
Whether or not he has elected Philippine citizenship within "a reasonable time".

Rulings:
1. No. Ching, despite the special circumstances, failed to elect Philippine citizenship within a
reasonable time. The reasonable time means that the election should be made within 3 years from
"upon reaching the age of majority", which is 21 years old. Instead, he elected Philippine citizenship
14 years after reaching the age of majority which the court considered not within the reasonable time.
Ching offered no reason why he delayed his election of Philippine citizenship, as procedure in
electing Philippine citizenship is not a tedious and painstaking process. All that is required is an
affidavit of election of Philippine citizenship and file the same with the nearest civil registry.
Categories: Constitutional Law 1

ANTONIO Y. CO v. ELECTORAL TRIBUNAL OF HOUSE OF REPRESENTATIVES, GR Nos.

92191-92, 1991-07-30

Facts:

petitioners... asking for the setting aside and reversal of a decision of the House of Representatives
Electoral Tribunal (HRET).

declared that respondent Jose Ong, Jr. is a natural born Filipino citizen and a resident of

Samar... congressional election for the second district of Northern Samar was held.

Among the candidates who vied for the position of representative... are the petitioners, Sixto Balinquit
and Antonio Co and the private respondent, Jose Ong,... Jr.

Respondent Ong won and was proclaimed the duly elected representative of the said district.

92
Respondent Ong was proclaimed the duly elected representative... petitioners filed election protests
against the private respondent... on the following grounds:

1) Jose Ong, Jr. is not a natural born citizen of the Philippines;

2) Jose Ong, Jr. is not a resident of the second district of Northern Samar.

Ong was favored by the HRET, while the petitioners filed a motion for reconsideration which was
subsequently denied, hence, these petitions for certiorari.... found for the private respondent.

The records show that in the year 1895, the private respondent's grandfather, Ong Te, arrived in the
Philippines from China.

established his residence in the municipality of Laoang, Samar on land... which he bought

Ong Te was able to obtain a certificate of residence from the then Spanish colonial administration.

Father of respondent Ong... was born in China in 1905.

was brought by Ong Te to Samar in the year 1915.

absorbed Filipino cultural values and practices.

baptized into Christianity... met a natural born-Filipina, Agripina Lao... got married in 1932 according
to Catholic faith and practice.

The couple bore eight children, one of whom is the private respondent who was born in 1948.

respondent Ong's father never left the country.... private respondent's father never emigrated from
this country.

Respondent Ong's father filed... for naturalization

in

1954

After a year, the lower Court... declared Jose Ong Chuan a Filipino citizen.

final and executory... took his Oath of Allegiance... certificate of naturalization was issued to him

At the time Jose Ong Chuan took his oath... private respondent then a minor... private respondent...
passed the CPA Board Examinations... found a job in the Central Bank of the Philippines as an
examiner.

the

Constitution removed the unequal treatment given to derived citizenship on the basis of the mother's
citizenship formally... his elder brother, Emil, was elected as a delegate to the 1971 Constitutional
Convention. His status as a natural born citizen was challenged.

Respondent, under the impression of being a natural born citizen by virtue of his elder brother's
declaration of being one,... registered himself as a voter of Laoang, Samar, and correspondingly,
voted there during those elections.

and ran for public office.

and was... voted by the people of Northern Samar as their representative in Congress

The pertinent portions of the Constitution found in Article IV read:

3. Those born before January 17, 1973, of Filipino mothers, who elect Philippine citizenship upon
reaching the age of majority; and

93
SECTION 2, Natural-born Citizens are those who

XXX

Those who elect Philippine citizenship in accordance with... paragraph 3 hereof shall be deemed
natural-born citizens."

There is no dispute that the respondent's mother was a natural born Filipina at the time of her
marriage. Crucial to this case is the issue of whether or not the respondent elected or chose to be a
Filipino citizen.

declared Emil Ong, respondent's full brother, as a natural born

Filipino.

Issues:

Whether or not, the HRET acted with grave abuse of discretion in declaring Jose Ong, Jr.
(respondent) as a natural born Filipino citizen.... whether or not, in making that determination, the
HRET acted with grave abuse of discretion

Ruling:

ON THE ISSUE OF JURISDICTION

Electoral Tribunals... are... independent of Congress and the Supreme Court.

HRET's... power... is intended to be as complete

In the instant case, the Court do not see any violation on the part of HRET that requires the exercise
of judicial review.

In the case at bar, the Court finds no improvident use of power, no denial of due process on the part
of the HRET which will necessitate the exercise of the power of judicial review by the Supreme Court.

ON THE ISSUE OF CITIZENSHIP... as if it had remained originally in the legislature.

The Court interprets Section 1, Paragraph 3 above as applying not only to those who elect Philippine
citizenship after February 2, 1987 but also to those who, having been born of Filipino mothers,
elected citizenship before that date.

There is no ambiguity in the deliberations of the Constitutional Commission, viz:

Fr. Bernas: It would apply to anybody who elected Philippine citizenship by virtue of the... provision
of the 1935 Constitution whether the election was done before or after January 17, 1973."

The 1935 Constitution states that ONLY those born of Filipino Fathers (with alien mothers) were
natural-born citizens, and those born of Filipino mothers (with alien fathers) needed to elect Philippine
citizenship at the age of majority. Since the 1973 Constitution states that "a natural-born citizen is one
who is a citizen of the Philippines from birth without having to perform any act to acquire or perfect his
Philippine citizenship. (Art. III, Sec.4), then it follows that those who needed to elect Philippine
citizenship are NOT natural-born citizens. Hence, Art. IV, Sec. 2 of the 1987 Constitution cured this
issue by expressly granting those who elected Philippine citizenship during the 1935 and 1973
Constitution, the title of "natural-born citizen".

Between 1935 and 1973 when we were under the 1935 Constitution, those born of Filipino fathers but
alien mothers were natural-born

Filipinos. However, those born of Filipino mothers but alien fathers would have to elect Philippine
citizenship upon reaching the age of majority; and if they do elect, they become Filipino citizens but
not natural-born Filipino citizens."

It must also be retroactive.

94
election through a sworn statement would have been an unusual and unnecessary procedure for one
who had been a citizen

In Re: Florencio Mallare... exercise of the right of suffrage when he came of age, constitutes a
positive act of election of

Philippine citizenship

The private respondent did more than merely exercise his right of suffrage.

We repeat that any election of Philippine citizenship on the part of the private respondent would not
only have been superfluous but it would also have resulted in an absurdity

In the issue of respondent's residence,

It has also been settled that absence from residence to pursue studies or practice a profession or
registration as a voter other than in the place where one is elected, does not constitute loss of
residence.

As previously stated, the private respondent stayed in Manila for the purpose of finishing his studies
and later to practice his profession. There was no intention to abandon the residence in Laoang,
Samar. On... the contrary, the periodical journeys made to his home province reveal that he always
had the animus revertendi.

Respondent Jose Ong, Jr. is declared a natural-born citizen of the Philippines

WHEREFORE, the petitions are hereby DISMISSED. The questioned decision of the House of
Representatives Electoral Tribunal is AFFIRMED. Respondent Jose Ong, Jr. is declared a natural-
born citizen of the Philippines and a resident of

Laoang, Northern Samar.

SO ORDERED.

DISSENTING (Justice Padilla) Private respondent Jose L. Ong Chuan, Jr. is NOT a natural-born
citizen.

WHEREFORE, my vote is clear: to declare private respondent Jose L. Ong Chuan, Jr., as he clearly
is, NOT a natural-born citizen of the Philippines and therefore NOT QUALIFIED to be a Member of
the House of Representatives,... Congress of the Philippines.

Principles:

The Constitution explicitly provides that the House of Representatives Electoral Tribunal (HRET) and
the Senate Electoral Tribunal (SET) shall be the sole judges of all contests relating to the election,
returns, and qualifications of their respective... members.

The authority conferred upon the Electoral Tribunal is full, clear and complete. The use of the word
sole emphasizes the exclusivity of the jurisdiction of these Tribunals.

any final action taken by the HRET on a... matter within its jurisdiction shall, as a rule, not be
reviewed by this Court

One may question, So...

When may the Court inquire into acts of the Electoral Tribunals under our constitutional grants of
power?

(1)Tribunal's resolution was rendered without or in excess of its jurisdiction, and that there has to be a
remedy for such abuse... upon a determination that the Tribunal's decision or resolution was rendered
without or in excess of its jurisdiction, or with grave abuse of discretion

(2) a clear showing that the Tribunal's usage of its power resulted in the denial of the due process of
law... upon a clear showing of such arbitrary and... improvident use by the Tribunal of its power as
constitutes a denial of due process of law,... In simple terms,

95
It comes in only when... it has to vindicate a denial of due process or correct an abuse of discretion so
grave or glaring that no less than the Constitution calls for remedial action.

The Supreme Court... has been given an expanded jurisdiction... to merely check whether or not the
governmental branch or agency has gone beyond the Constitutional limits of its jurisdiction, not that it
erred or has a different... view.

it will not decide a matter which by its... nature is for the HRET alone to decide.

The basis of Article IV, Sec. 2's' additional provision granting anyone who elected Philippine
citizenship by virtue of the provision of the 1935 Constitution whether the election was done before or
after January 17, 1973

"Mr. Rodrigo: But this provision becomes very important because his election of Philippine citizenship
makes him not only a Filipino citizen but a natural-born Filipino citizen entitling him to run for
Congress. . .

Fr. Bernas: Correct. We are quite aware of that and for that reason we will leave it to the body to
approve that provision of section 4.

Mr. Rodrigo: I think there is a good basis for the provision because it strikes me as unfair that the
Filipino citizen who was born a day before January 17, 1973 cannot be a Filipino citizen or a natural-
born citizen." (Records of the

Constitutional Commission, Vol. 1, p. 231)... exercise of the right of suffrage when he came of age,
constitutes a positive act of election of

Philippine citizenship"

An election of Philippine citizenship presupposes that the person electing is an alien.

It has also been settled that absence from residence to pursue studies or practice a profession or
registration as a voter other than in the place where one is elected, does not constitute loss of
residence.

ANTONIO BENGSON III v. HOUSE OF REPRESENTATIVES ELECTORAL TRIBUNAL, GR No.

142840, 2001-05-07
Facts:
Respondent Cruz was a natural-born citizen of the Philippines.
The fundamental law then applicable was the 1935 Constitution
On November 5, 1985, however, respondent Cruz enlisted in the United States Marine Corps and,
without the consent of the Republic of the Philippines, took an oath of allegiance to the United States.
he lost his Filipino citizenship for under Commonwealth Act
No. 63, Section 1(4), a Filipino citizen may lose his citizenship by, among others, "rendering service
to or accepting commission in the armed forces of a foreign country."
Whatever doubt that remained regarding his loss of Philippine citizenship was erased by his
naturalization as a U.S. citizen on June 5, 1990, in connection with his service in the U.S. Marine
Corps... respondent Cruz reacquired his Philippine citizenship through repatriation under Republic Act
No. 2630
He ran for and was elected as the Representative of the Second District of Pangasinan in the May 11,
1998 elections. He won

96
HRET rendered its decision... declaring respondent Cruz the duly elected Representative of the
Second District of Pangasinan in the May 1998 elections
Petitioner thus filed the present petition for certiorari assailing the HRET's decision on the following
grounds:
The HRET committed serious errors and grave abuse of discretion, amounting to excess of
jurisdiction, when it considered private respondent as a citizen of the Philippines despite the fact that
he did not validly acquire his Philippine citizenship.
Issues:
The citizenship of respondent Teodoro C. Cruz is at issue in this case, in view of the constitutional
requirement that "no person shall be a Member of the House of Representatives unless he is a
natural-born citizen."
The issue now before us is whether respondent Cruz, a natural-born Filipino who became an
American citizen, can still be considered a natural-born Filipino upon his reacquisition of Philippine
citizenship
Ruling:
The petition is without merit
In respondent Cruz's case, he lost his Filipino citizenship when he rendered service in the Armed
Forces of the United States. However, he subsequently reacquired Philippine citizenship under R.A.
No. 2630,... Having thus taken the required oath of allegiance to the Republic and having registered
the same in the Civil Registry of Magantarem, Pangasinan in accordance with the aforecited
provision, respondent Cruz is deemed to have recovered his original status as a natural-born...
citizen, a status which he acquired at birth as the son of a Filipino father.
Principles:
Naturalization is a mode for both acquisition and reacquisition of Philippine citizenship. As a mode of
initially acquiring Philippine citizenship, naturalization is governed by Commonwealth Act No. 473, as
amended. On the other hand, naturalization as a mode for reacquiring
Philippine citizenship is governed by Commonwealth Act No. 63
Repatriation, on the other hand, may be had under various statutes by those who lost their citizenship
due to: (1) desertion of the armed forces;
(2) service in the armed forces of the allied forces in World War II
(3)... service in the Armed Forces of the United States at any other time
(4) marriage of a Filipino woman to an alien;... political and economic necessity... repatriation results
in the recovery of the original nationality
This means that a naturalized Filipino who lost his citizenship will be restored to his prior status as a
naturalized Filipino citizen. On the other hand, if he was... originally a natural-born citizen before he
lost his Philippine citizenship, he will be restored to his former status as a natural-born Filipino.
the act of repatriation allows him to recover, or return to, his original status before he lost his
Philippine citizenship.
Two requisites must concur for a person to be considered as such: (1) a person must be a Filipino
citizen from birth and (2) he does not have to perform any act to obtain or perfect his Philippine
citizenship.

EDISON SO v. REPUBLIC, GR NO. 170603, 2007-01-29

Facts:

etitioner Edison So filed before the RTC a Petition for Naturalization[3] under Commonwealth Act
(C.A.) No. 473, otherwise known as the Revised Naturalization Law,... He was born on February 17,
1982, in Manila; he is a Chinese citizen who has lived in No. 528 Lavezares St., Binondo, Manila,
since birth;... tition were the Joint Affidavit[4] of Atty. Artemio Adasa, Jr. and Mark B. Salcedo; and
petitioner�s Certificate of Live Birth,[5] Alien Certificate of Registration,[6] and Immigrant

Certificate of Residenc

On March 22, 2002, the RTC issued an Order[8] setting the petition for hearing at 8:30 a.m. of
December 12 and 17, 2002 during which all persons concerned were enjoined to show cause, if any,
why the petition should not be granted. The entire petition and... its annexes, including the order,
were ordered published once a week for three consecutive weeks in the Official Gazette and also in a

97
newspaper of general circulation in the City of Manila. The RTC likewise ordered that copies of the
petition and notice be posted in public and... conspicuous places in the Manila City Hall Building.

No one opposed the petition. During the hearing, petitioner presented Atty. Adasa, Jr. who testified
that he came to know petitioner in 1991 as the legal consultant and adviser of the So family�s
business.

Atty. Adasa, Jr. further testified that petitioner was gainfully employed and presently resides at No.
528 Lavezares

Street, Binondo, Ma

Another witness for petitioner, Mark Salcedo, testified that he has known petitioner for ten (10) years;
they first met at a birthday party in 1991. He and petitioner were classmates at the University of Santo
Tomas (UST) where they took up Pharmacy. Petitioner was a member of... some school
organizations and mingled well with friends... etitioner also testified and attempted to prove that he
has all the qualifications and none of the disqualifications to become a citizen of the Philippines.

The RTC granted the petition on June 4, 2003.

The trial court ruled that the witnesses for petitioner had known him for the period required by law,
and they had affirmed that petitioner had all the qualifications and none of the disqualifications to
become a Filipino citizen. Thus, the court concluded that petitioner had... satisfactorily supported his
petition with evidence.

Respondent Republic of the Philippines, through the Office of the Solicitor General (OSG), appealed
the decision to the CA

ETITIONER IS NOT QUALIFIED TO BE ADMITTED AS CITIZEN OF THE PHILIPPINES.

It insisted that his two (2) character witnesses did not know him well... enough to vouch for his fitness
to become a Filipino citizen; they merely made general statements without giving specific details
about his character and moral conduct.[28] The witnesses did not even reside in the same place as
petitioner.[29] Respondent likewise argued that petitioner himself failed to prove that he is qualified to
become a Filipino citizen because he did not give any explanation or specific answers to the
questions propounded by his lawyer. He merely answered �yes� or �no� or... gave
general statements in answer to his counsel�s questions. Thus, petitioner was unable to prove that
he had all the qualifications and none of the disqualifications required by law to be a naturalized
Filipino citizen.[30]

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit.

Issues:

THE LOWER COURT ERRED IN GRANTING THE PETITION FOR NATURALIZATION DESPITE
THE FACT THAT THE TWO (2) CHARACTER WITNESSES, NAMELY: ARTEMIO ADASA, JR. AND
MARK SALCEDO WERE NOT QUALIFIED CHARACTER WITNESSES.

THE LOWER COURT ERRED IN GRANTING THE PETITION FOR NATURALIZATION DESPITE
THE FACT THAT THE TWO (2) CHARACTER WITNESSES, NAMELY: ARTEMIO ADASA, JR. AND
MARK SALCEDO WERE NOT QUALIFIED CHARACTER WITNESSES.

THE LOWER COURT ERRED IN GRANTING THE PETITION FOR NATURALIZATION DESPITE
THE FACT THAT THE TWO (2) CHARACTER WITNESSES, NAMELY: ARTEMIO ADASA, JR. AND
MARK SALCEDO WERE NOT QUALIFIED CHARACTER WITNESSES.

Respondent contended that based on the evidence on record, appellee failed to prove that he
possesses all the qualifications under Section 2 and none of the disqualifications under Section 4 of
C.A. No. 47

Ruling:

the CA set aside the ruling of the RTC and dismissed the petition for naturalization without prejudice.
[34] According to the CA, petitioner�s two (2) witnesses were not credible because they... failed to
mention specific details of petitioner�s life or character to show how well they knew him; they

98
merely �parroted� the provisions of the Naturalization Act without clearly explaining their
applicability to petitioner�s case.[35] The... appellate court likewise ruled that petitioner failed to
comply with the requirement of the law that the applicant must not be less than 21 years of age on the
day of the hearing of the petition; during the first hearing on December 12, 2002, petitioner was only
twenty (20)... years, nine (9) months, and twenty five (25) days old, falling short of the requirement.
[36] The CA stated, however, that it was not its intention to forever close the door to any future
application for naturalization which petitioner would file, and that... it believes that he would make a
good Filipino citizen in due time, a decided asset to this country.[37]

Petitioner�s motion for reconsideration[38] was denied in a Resolution... petitioner failed to show
full and complete compliance with the requirements of naturalization law. For this reason, we affirm
the decision of the CA denying the petition for naturalization without prejudice.

It must be stressed that admission to citizenship is one of the highest privileges that the Republic of
the Philippines can confer upon an alien. It is a privilege that should not be conferred except upon
persons fully qualified for it, and upon strict compliance with the... law.[60]

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit.

Principles:

RENATO M. DAVID v. EDITHA A. AGBAY, GR No. 199113, 2015-03-18

Facts:
In 1974, petitioner migrated to Canada where he became a Canadian citizen by naturalization. Upon
their retirement, petitioner and his wife returned to the Philippines... they purchased a 600-square
meter lot along the beach in Tambong, Gloria, Oriental Mindoro... where they constructed a
residential house... in the year 2004, they came to know that the portion where they built their house
is public land and part of the salvage zone.
filed a Miscellaneous Lease Application[3] (MLA) over the subject land with the Department of
Environment and Natural Resources (DENR) at the Community Environment and Natural Resources
Office (CENRO) in Socorro. In the said... application, petitioner indicated that he is a Filipino citizen.
Agbay opposed the application on the ground that petitioner, a Canadian citizen, is disqualified to
own land. She also filed a criminal complaint for falsification of public documents... petitioner re-
99
acquired his Filipino citizenship under the provisions of Republic Act No. 9225... petitioner averred
that at the time he filed his application, he had intended to re-acquire Philippine citizenship and that
he had been assured by a CENRO officer that he could declare himself as a Filipino. He further
alleged that he bought the property from the
Agbays who misrepresented to him that the subject property was titled land and they have the right
and authority to convey the same. The dispute had in fact led to the institution of civil and criminal
suits between him and private respondent's family.
finding probable cause to indict petitioner for violation of Article 172 of the RPC and recommending
the filing of the corresponding information in... court.
CENRO issued an order rejecting petitioner's MLA. It ruled that petitioner's subsequent re-acquisition
of Philippine citizenship did not cure the defect in his MLA which was void ab initio... the presence of
the elements of the crime of falsification of public document suffices to warrant indictment of the
petitioner notwithstanding the absence of any... proof that he gained or intended to injure a third
person in committing the act of falsification... filed before the MTC... a warrant of arrest was issued...
against the petitioner.
petitioner elevated the case to the RTC via a petition[15] for certiorari under Rule 65, alleging grave
abuse of discretion on the part of the MTC. He asserted that first, jurisdiction over the person of an
accused cannot be a... pre-condition for the re-determination of probable cause by the court that
issues a warrant of arrest
RTC issued the assailed Order denying the petition for certiorari after finding no grave abuse of
discretion committed by the lower court... the policy of the State that all Philippine citizens who
become citizens of another country shall be deemed not to have lost their Philippine citizenship under
the conditions of this Act... deemed to... have reacquired Philippine citizenship upon taking the
following oath of allegiance to the Republic
Natural-born citizens of the Philippines who, after the effectivity of this Act, become citizens of a
foreign country shall retain their Philippine citizenship upon taking the aforesaid oath... naturalized in
a foreign country, they shall be deemed to have re-acquired their Philippine citizenship which was lost
pursuant to CA 63, under which naturalization in a foreign country is one of the ways by which
Philippine citizenship may be lost.
As its title declares, R.A. 9225 amends CA 63 by doing away with the provision in the old law which
takes away Philippine citizenship from natural-born Filipinos who become naturalized citizens of other
countries and allowing dual citizenship,[21] and also... provides for the procedure for re-acquiring and
retaining Philippine citizenship. In the case of those who became foreign citizens after R.A. 9225 took
effect, they shall retain Philippine citizenship despite having acquired foreign citizenship provided they
took the oath of... allegiance under the new law
Issues:
in seeking an affirmative relief from the MTC when he filed his Urgent Motion for Re-determination of
Probable Cause, petitioner is deemed to have submitted his person to the... said court's jurisdiction
by his voluntary appearance... the MTC... properly denied petitioner's motion for re-determination of
probable cause on the ground of lack of jurisdiction over the person of the accused (petitioner).
Ruling:
contentions have no merit... petitioner was naturalized as a Canadian citizen prior to the effectivity of
R.A. 9225, he belongs to the first category of natural-born Filipinos under the first paragraph of
Section 3 who lost Philippine citizenship by naturalization in a foreign country. As... the new law
allows dual citizenship, he was able to re-acquire his Philippine citizenship by taking the required oath
of allegiance
Section 2 declaring the policy that considers Filipinos who became foreign citizens as not to have
lost... their Philippine citizenship, should be read together with Section 3, the second paragraph of
which clarifies that such policy governs all cases after the new law's effectivity.
Courts adopt an interpretation more favorable to the accused following the time-honored principle that
penal statutes are construed strictly against the State and liberally in... favor of the accused.[23] R.A.
9225, however, is not a penal law.

100
Petitioner made the untruthful statement in the MLA, a public document, that he is a Filipino citizen at
the time of the filing of said application, when in fact he was then still a Canadian citizen. Under CA
63, the governing law at the time he was naturalized as Canadian... citizen, naturalization in a foreign
country was among those ways by which a natural-born citizen loses his Philippine citizenship. While
he re-acquired Philippine citizenship under R.A. 9225 six months later, the falsification was already a
consummated act, the said law having... no retroactive effect insofar as his dual citizenship status is
concerned. The MTC therefore did not err in finding probable cause for falsification of public
document under Article 172, paragraph 1.
jurisdiction over the person of the accused is deemed waived when he files any pleading seeking an
affirmative relief, except in cases when he invokes the special jurisdiction of the court by impugning
such jurisdiction over his person
Considering that petitioner sought affirmative relief in filing his motion for re-determination of probable
cause, the MTC clearly erred in stating that it lacked jurisdiction over his person. Notwithstanding
such erroneous ground stated in the MTC's order, the RTC correctly... ruled that no grave abuse of
discretion was committed by the MTC in denying the said motion... petition is DENIED
Principles:

LOIDA NICOLAS-LEWIS v. COMELEC, GR NO. 162759, 2006-08-04

Facts:
Petitioners are successful applicants for recognition of Philippine citizenship under R.A. 9225 which
accords to such applicants the right of suffrage... petitioners sought registration and certification as
"overseas absentee voter" only to be advised by the Philippine Embassy in the United States that, per
a COMELEC letter to the Department of Foreign Affairs... they have yet no right to vote in such
elections owing to their lack of... the one-year residence requirement prescribed by the Constitution.
in Macalintal vs. COMELEC

101
Although R.A. 9225 enjoys the presumption of constitutionality ..., it is the Commission's position that
those who have availed of the law cannot exercise the right of suffrage given under the OAVL for the
reason that the OAVL was not enacted for them. Hence, as
Filipinos who have merely re-acquired their citizenship on 18 September 2003 at the earliest, and as
law and jurisprudence now stand, they are considered regular voters who have to meet the
requirements of residency, among others under Section 1, Article 5 of the Constitution.
Faced with the prospect of not being able to vote in the May 2004 elections... petitioner Nicolas-Lewis
et al.,[5] filed on April 1, 2004 this petition for... certiorari and mandamus.
On May 20, 2004
OSG... stating that "all qualified overseas Filipinos, including dual citizens who care to exercise the
right of suffrage, may do so", observing, however, that... the conclusion of the 2004 elections had
rendered the petition moot and academic.
The broader and transcendental issue tendered or subsumed in the petition, i.e.,... the propriety of
allowing "duals" to participate and vote as absentee voter in future elections, however, remains
unresolved.
Issues:
whether or not petitioners and others who might have meanwhile retained and/or reacquired
Philippine citizenship pursuant to R.A. 9225 may vote as... absentee voter under R.A. 9189.
Ruling:
The Court resolves the poser in the affirmative, and thereby accords merit to the petition.
In a nutshell, the aforequoted Section 1 prescribes residency requirement as a general eligibility
factor for the right to vote. On the other hand, Section 2 authorizes Congress to devise a system
wherein an absentee may vote, implying that a non-resident may, as an... exception to the residency
prescription in the preceding section, be allowed to vote.
In response to its above mandate, Congress enacted R.A. 9189 - the OAVL
Section 5(d) of R.A. 9189 passed the test of constitutionality, Congress enacted R.A. 9225
SEC. 5. Civil and Political Rights and Liabilities. Those who retain or re-acquire Philippine citizenship
under this Act shall enjoy full civil and political rights and be subject to all attendant liabilities and
responsibilities under existing laws of the
Philippines and the following conditions:

1. Those intending to exercise their right of suffrage must meet the requirements under Section 1,
Article V of the Constitution, Republic Act No. 9189, otherwise known as "The Overseas
Absentee Voting Act of 2003" and other existing laws;

As may be noted, there is no provision in the dual citizenship law - R.A. 9225 - requiring "duals" to
actually establish residence and physically stay in the Philippines first before they can exercise their
right to vote. On the contrary, R.A. 9225, in implicit acknowledgment... that 'duals' are most likely non-
residents, grants under its Section 5(1) the same right of suffrage as that granted an absentee voter
under R.A. 9189. It cannot be overemphasized that R.A. 9189 aims, in essence, to enfranchise as
much as possible all overseas Filipinos who,... save for the residency requirements exacted of an
ordinary voter under ordinary conditions, are qualified to vote. Thus, wrote the Court in Macalintal:...
intended to enfranchise as much as possible all Filipino citizens abroad who have not abandoned
their domicile of origin. The Commission even intended to extend to young
Filipinos who reach voting age abroad whose parents' domicile of origin is in the Philippines, and
consider them qualified as voters for the first time.
It is in pursuance of that intention that the Commission provided for Section 2 [Article V] immediately
after the residency requirement of Section 1. By the doctrine of necessary implication in statutory
construction, ...., the strategic location of Section 2 indicates that the
Constitutional Commission provided for an exception to the actual residency requirement of Section 1
with respect to qualified Filipinos abroad. The same Commission has in effect declared that qualified

102
Filipinos who are not in the Philippines may be allowed to vote... even though they do not satisfy the
residency requirement in Section 1, Article V of the Constitution.
the COMELEC itself admits that the Citizenship Retention and Re Acquisition Act expanded the
coverage of overseas absentee voting.
Considering the unison intent of the Constitution and R.A. 9189 and the expansion of the scope of
that law with the passage of R.A. 9225, the irresistible conclusion is that "duals" may now exercise
the right of suffrage thru the absentee voting scheme and as... overseas absentee voters.
we note that the expanded thrust of R.A. 9189 extends also to what might be tag as the next
generation of "duals". This may be deduced from the inclusion of the provision on derivative
citizenship in R.A. 9225... he Court rules and so holds that those who retain or re acquire Philippine
citizenship under Republic Act No. 9225, the Citizenship Retention and Re Acquisition Act of 2003,
may... exercise the right to vote under the system of absentee voting in Republic Act No. 9189, the
Overseas Absentee Voting Act of 2003.
Principles:
Sections 1 and 2 of Article V of the Constitution
SECTION 1. Suffrage may be exercised by all citizens of the Philippines not otherwise disqualified by
law, who are at least eighteen years of age, and who shall have resided in the Philippines for at least
one year and in the place wherein they propose to vote for at... least six months immediately
preceding the election.
SEC 2. The Congress shall provide ... a system for absentee voting by qualified Filipinos abroad.

EN BANC

[ GR No. 83820, May 25, 1990 ]

JOSE B. AZNAR v. COMELEC +

DECISION

PARAS, J.:

103
Before Us is a petition for certiorari assailing the Resolution of the Commission on Elections
(COMELEC) dated June 11, 1988, which dismissed the petition for the disqualification of private
respondent Emilio "Lito" Osmena as candidate for Provincial Governor of Cebu Province.
The facts of the case are briefly as follows:
On November 19, 1987, private respondent Emilio "Lito" Osmena filed his certificate of candidacy
with the COMELEC for the position of Provincial Governor of Cebu Province in the January 19, 1988
local elections.
On January 22, 1988, the Cebu PDP-Laban Provincial Council (Cebu-PDP Laban, for short), as
represented by petitioner Jose B. Aznar in his capacity as its incumbent Provincial Chairman, filed
with the COMELEC a petition for the disqualification of private respondent on the ground that he is
allegedly not a Filipino citizen, being a citizen of the United States of America.
On January 27, 1988, petitioner filed a Formal Manifestation submitting a Certificate issued by the
then Immigration and Deportation Commissioner Miriam Defensor Santiago certifying that private
respondent is an American and is a holder of Alien Certificate of Registration (ACR) No. B-21448 and
Immigrant Certificate of Residence (ICR) No. 133914, issued at Manila on March 27 and 28, 1958,
respectively. (Annex "B-1").
The petitioner also filed a Supplemental Urgent Ex-Parte Motion for the Issuance of a Temporary
Restraining Order to temporarily enjoin the Cebu Provincial Board of Canvassers from
tabulating/canvassing the votes cast in favor of private respondent and proclaiming him until the final
resolution of the main petition.
Thus, on January 28, 1988, the COMELEC en banc resolved to order the Board tip continue
canvassing but to suspend the proclamation.
At the hearing before the COMELEC (First Division), the petitioner presented the following exhibits
tending to show that private respondent is an American citizen: Application for Alien Registration
Form No. 1 of the Bureau of Immigration signed by private respondent dated November 21, 1979
(Exh. "B"); Alien Certificate of Registration No. 015356 in the name of private respondent dated
November 21, 1979 (Exh. "C"); Permit to Re-enter the Philippines dated November 21, 1979 (Ex.
"D"); Immigration Certifitate of Clearance dated January 3, 1980 (Exh. "E"). (pp. 117-118, Rollo)
Private respondent, on the other hand, maintained that he is a Filipino citizen, alleging: that he is the
legitimate child of Dr. Emilia D. Osmena, a Filipino and son of the late President Sergio Osmena, Sr.;
that he is a holder of a valid and subsisting Philippine Passport No. 0855103 issued on March 25,
1987; that he has been continuously residing in the Philippines since birth and has not gone out of the
country for more than six months; and that he has been a registered voter in the Philippines since
1965. (pp. 107-108, Rollo)
On March 3, 1988, COMELEC (First Division) directed the Board of Canvassers to proclaim the
winning candidates. Having obtained the highest number of votes, private respondent was
proclaimed the Provincial Governor of Cebu.
Thereafter, on June 11, 1988, COMELEC (First Division) dismissed the petition for disqualification for
not having been timely filed and for lack of sufficient proof that private respondent is not a Filipino
citizen.
Hence, the present petition.
The petition is not meritorious.
There are two instances where a petition questioning the qualifications of a registered candidate to
run for the office for which his certificate of candidacy was filed can be raised under the Omnibus
Election Code (B.P. Blg. 881), to wit:
"(1) Before election, pursuant to Section 78 thereof which provides that:
'Section 78. Petition to deny due course or to cancel a certificate of candidacy. --- A verified petition
seeking to deny due course or to cancel a certificate of candidacy may be filed by any person
exclusively on the ground that any material representation contained therein as required under
section 74 hereof is false. The petition may be filed at any time not later than twenty-
five days from the time of the filing of the certificate of candidacy and shall be decided, after the
notice and hearing, not later than fifteen days before the election.
and
"(2) After election, pursuant to Section 253 thereof, viz:

104
'Sec. 253. Petition for quo warranto. --- Any voter contesting the election of any Member of
the Batasang Pambansa, regional, provincial or city officer on the ground of inelligibility or of
disloyalty to the Republic of the Philippines shall file a sworn petition for quo warranto with the
Commission within ten days after the proclamation of the results of the election."
The records show that private respondent filed his certificate of candidacy on November 19, 1987 and
that the petitioner filed its petition for disqualification of said private respondent on January 22,
1988. Since the petition for disqualification was filed beyond the twenty five-day period required in
Section 78 of the Omnibus Election Code, it is clear that said petition was filed cut of time.
The petition for the disqualification of private respondent cannot also be treated as a petition
for quo warranto under Section 253 of the same Code as it is unquestionably premature, considering
that private respondent was proclaimed Provincial Governor of Cebu only on March 3, 1988.
However, We deem it is a matter of public interest to ascertain the respondent's citizenship and
qualification to hold the public office to which has been proclaimed elected. There is enough basis for
us to rule directly on the merits of the case, as the COMELEC did below.
Petitioner's contention that private respondent is not a Filipino citizen and, therefore, disqualified from
running for and being elected to the office of Provincial Governor of Cebu, is not supported by
substantial and convincing evidence.
In the proceedings before the COMELEC, the petitioner failed to present direct proof that private
respondent had lost his Filipino citizenship by any of the modes provided for under C. A. No.
63. Among others, these are: (1) by naturalization in a foreign country; (2) by express renunciation
of citizenship; and (3) by subscribing to an oath of allegiance to support the Constitution or laws of a
foreign country. From the evidence, it is clear that private respondent Osmena did not lose his
Philippine citizenship by any of the three mentioned hereinabove or by any other mode of losing
Philippine citizenship.
In concluding that private respondent had been naturalized as a citizen of the United States of
America, the petitioner merely relied on the fact that private respondent was issued alien certificate of
registration and was given clearance and permit to re-enter the Philippines by the Commission on
Immigration and Deportation. Petitioner assumed that because of the foregoing, the respondent is an
American and "being an American", private respondent "must have taken and sworn to the Oath of
Allegiance required by the U.S. Naturalization Laws." (p. 81, Rollo)
Philippine courts are only allowed to determine who are Filipino citizens and who are not. Whether or
not a person is considered an American under the laws of the United States does not concern us
here.
By virtue of his being the son of a Filipino father, the presumption that private respondent is a Filipino
remains. It was incumbent upon the petitioner to prove that private respondent had lost his Philippine
citizenship. As earlier stated, however, the petitioner failed to positively establish this fact.
The cases of Juan Gallanosa Frivaldo v. COMELEC et al, (G.R. No. 87193, June 21, 1989) and
Ramon L. Labo v. COMELEC et al (G.R. No. 86564, August 1, 1989) are not applicable to the case at
bar.
In the Frivaldo case, evidence shows that he was naturalized as a citizen of the United States in 1983
per certification from the United States District Court, Northern District of California, as duly
authenticated by Vice Consul Amado P. Cortez of the Philippine Consulate General in San Francisco,
California, U.S. A.
Frivaldo expressly admitted in his answer that he was naturalized in the United States but claimed
that he was forced to, embrace American citizenship to protect himself from the persecution of the
Marcos government. The Court, however, found this suggestion of involuntariness unacceptable,
pointing out that there were many other Filipinos in the United States similarly situated
as Frivaldo who did not find it necessary to abandon their status as Filipinos.
Likewise, in the case of Labo, records show that Labo was married to an Australian citizen and that
he was naturalized as an Australian citizen in 1976, per certification from the Australian Government
through its Consul in the Philippines. This was later affirmed by the Department of Foreign Affairs.
The authenticity of the above evidence was not disputed by Labo. In fact, in a number of sworn
statements, Labo categorically declared that he was a citizen of Australia.
In declaring both Frivaldo and Labo not citizens of the Philippines, therefore, disqualified from serving
as Governor of the Province of Sorsogon and Mayor of Baguio City, respectively, the Court
considered the fact that by their own admissions, they are indubitably aliens, no longer owing any

105
allegiance to the Republic of the Philippines since they have sworn their total allegiance to a foreign
state.
In instant case, private respondent vehemently denies having taken the oath of allegiance of the
United States (p. 81, Rollo). He is a holder of a valid and subsisting Philippine passport and has
continuously participated in the electoral process in this country since 1963 up to the present, both as
a voter and as a candidate (pp. 107-108, Rollo). Thus, private respondent remains a Filipino and the
loss of his Philippine citizenship cannot be presumed.
In the learned dissent of Mr. Justice Teodoro Padilla, he stresses the fact that
because Osmena obtained Certificates of Alien Registration as an American citizen, the first in 1958
when he was 24 years old and the second in 1979, he, Osmena should be regarded a having
expressly renounced Philippine citizenship. To Our mind, this is a case of non sequitur (It does not
follow). Considering the fact that admittedly Osmena was both a Filipino and an American, the mere
fact that he has a Certificate stating he is an American does not mean that he is not still a
Filipino. Thus, by way of analogy, if a person who has two brothers named Jose and Mario states or
certifies that he has a brother named Jose, this does not mean that he does not have a brother
named Mario; or if a person is enrolled as a student simultaneously in two universities, namely
University X and University Y, presents a Certification that he is a student of University X, this does
not necessarily mean that he is not still a student of University Y. In the case of Osmena, the
Certification that he is an American does not mean that he is not still a Filipino, possessed as he is,
of both nationalities or citizenships. Indeed, there is no express renunciation here of Philippine
citizenship; truth to tell, there is even no implied renunciation of said citizenship. When We consider
that the renunciation needed to lose Philippine citizenship must be "express", it stands to reason that
there can be no such loss of Philippine
citizenship when there is no renunciation, either "express" or "implied".
Parenthetically, the statement in the 1987 Constitution that "dual allegiance of citizens is inimical to
the national interest and shall be dealt with by law" (Art. IV, Sec. 5) has no retroactive effect. And
while it is true that even before the 1987 Constitution, Our country had already frowned upon the
concept of dual citizenship or allegiance, the fact is it actually existed. Be it noted further that under
the aforecited proviso, the effect of such dual citizenship or allegiance shall be dealt with by a future
law. Said law has not yet been enacted.
WHEREFORE, the petition for certiorari is hereby DISMISSED and the Resolution of the COMELEC
is hereby AFFIRMED.
SO ORDERED.
Narvasa, Bidin, Griño-Aquino, Medialdea, and Regalado, JJ., concur.
Feliciano, J., joins J. Sarmiento in his concurring opinion.
Melencio-Herrera, Cruz, Padilla, JJ., see dissenting opinion.
Cortes, J. in the result.
Fernan, C.J., no part, formerly counsel for Osmeña Estate.
Gutierrez, Jr., J, no part.
Gancayco, J., on official leave.

Clean 6 pt 6 pt 0 3 MicrosoftInternetExplorer4 style-->

DISSENTING OPINION
CRUZ, J.:
I join Mr. Justice Padilla in his dissent.
It seems to me that when a person voluntarily registers as an alien, he is in effect affirming that he is
not a citizen. The terms "citizen" and "alien" are mutually exclusive from the viewpoint of municipal
law, which is what really matters in the case at bar. Under this discipline, one is either a citizen of the
local state or he is not; and the question is resolved on the basis of its own laws alone and not those
of any other state.
One of the several modes of losing Philippine citizenship under C.A. No. 63 is by "express
renunciation" thereof. In the case of Frivaldo v. Commission on Elections, G.R. No. 87193, June 23,
1989, there was such renunciation when the petitioner took an oath as a naturalized citizen of the
United States in which he renounced all allegiance to all other states. In the case of Labo v.
Commission on Elections, G.R. No. 86546, August 1, 1989, the petitioner not only took a similar oath
after his naturalization in Australia but also executed other documents in which he stated that he was
not a Filipino.

106
The fact that his naturalization was later revoked did not also invalidate his disavowal of Philippine
citizenship. "Express renunciation" is a separate mode of losing Philippine citizenship and is not
necessarily dependent on "naturalization in a foreign country," which is another and different mode.
When a person rejects and divorces his wife to enter into a second marriage, he cannot say he still
loves her despite his desertion. The undeniable fact is that he has left her for another woman to
whom he has totally and solemnly transferred his troth. It does him no credit when he protests he
married a second time simply for material convenience and that his heart still belongs to the wife he
has abandoned. At worst, it would reveal his sordid and deceitful character.
By the same token, professing continued allegiance to the Philippines after renouncing it because of
its meager resources, or for other ulterior and equally base reasons, is to me a paltry form of
patriotism. It is a sop to the repudiated state and a slight to the adopted state. No matter how noble
this attitude may appear to others, it is to me nothing less than plain and simple hypocrisy that we
should not condone, let alone extol.
Coming now to the case at bar, I note first of all that no naturalization is involved here as the private
respondent claims to be a citizen both of the Philippines and of the United States. The question I
think we must answer is: Was there an express renunciation of Philippine citizenship by the private
respondent when he knowingly and voluntarily registered as an alien with the Commission of
Immigration and Deportation in 1958 and in 1979?
In Yu v. Commission of Immigration and Deportation, G.R. No. 83882, January 24, 1989, I made the
following observations in a separate opinion:
Regretfully, I cannot agree with the finding that the petitioner has expressly renounced his Philippine
citizenship. The evidence on this point is in my view rather meager. Express renunciation of
citizenship as a mode of losing citizenship under Com. Act No. 63 is an unequivocal and deliberate
act with full awareness of its significance and consequences. I do not think the "commercial
documents he signed" suggest such categorical disclaimer.
That case is distinguished from the one before us now in that Yu did not ask the Philippine
government to register him as an alien, Gov. Osmeña did.
It is my opinion that if the governor had confined himself to simply seeking and using an American
passport, these acts could not have by themselves alone constituted a repudiation of Philippine
citizenship. The problem, though, is that he did more than enjoy this legal convenience. What he
actually did was register with the Philippine government as an alien within its own territory,
presumably so he could be insulated from the jurisdiction it exercises over its nationals. This was a
voluntary act. As a citizen of the Philippines, he was not required to register as an
alien. Nevertheless, he chose to do so of his own free will. By this decision, he categorically asked
the Republic of the Philippines to treat him as an American and not a Filipino, choosing to be an alien
in this land that was willing to consider him its own.
C.A. No. 63 does not necessarily require that the express renunciation of Philippine citizenship be
made in connection with the naturalization of the erstwhile Filipino in a foreign country. Renunciation
may be made independently of naturalization proceedings. Morever, no sacramental words are
prescribed by the statute for the express renunciation of Philippine citizenship. As long as the
repudiation is categorical enough and the preference for the foreign state is unmistakable, as in the
case at bar, Philippine citizenship is lost.
The private respondent would have his cake and eat it too, but this can never be allowed where
Philippine citizenship is involved. It is a gift that must be deserved to be retained. The Philippines,
for all her modest resources compared to those of other states, is a jealous and possessive mother
demanding total love and loyalty from her children. It is bad enough that the love of the dual national
is shared with another state; what is worse is where he formally rejects the Philippines, and in its own
territory at that, and offers his total devotion to the other state.
I am aware of the praiseworthy efforts of Gov. Osmeña to improve the province of Cebu, and also, I
should add, of the commendable record of Gov. Frivaldo and Mayor Labo in the administration of
their respective jurisdictions. But that is not the point. The point is that it is not lawful to maintain in
public office any person who, although supported by the electorate, is not a Filipino citizen. This is a
relentless restriction we cannot ignore.
Regretfully, therefore, I must vote to GRANT the petition.

107
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DISSENTING OPINION
MELENCIO-HERRERA, J.:
I join the dissent of Messrs. Justices Isagani A. Cruz and Teodoro R. Padilla.
While it may be that dual citizenship usually results from accident of birth, a choice will have to be
made by the individual concerned at some point in time in his life, involving as it does the priceless
heritage of citizenship.
That election was made by private respondent when, in 1958, at the age of 24, and in 1979, at 45, he
obtained Alien Certificates of Registration. Registration as an alien is a clear and unambiguous act or
declaration that one is not a citizen. If, in fact, private respondent was merely compelled to so
register because of the "uncooperativeness" of the past regime, he could have, under the new
dispensation, asked for the cancellation of those Alien Certificates and abandoned his
alienage, specially before he ran for public office in 1988.
The 1987 Constitution declares in no uncertain terms that "dual allegiance of citizens is inimical to the
national interest and shall be dealt with by law" (Article IV, Section 5). That statement is but a
reaffirmation of an innate conviction shared by every Filipino. The law referred to need not be
awaited for one to consider giving up the legal convenience of dual citizenship.
Accordingly, I vote to grant the Petition.

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DISSENTING OPINION
PADILLA, J.:
I am constrained to dissent.
I start from the premise that the private respondent Emilio Mario Renner Osmena enjoyed at one time
dual citizenship, i.e., Philippine and U.S. citizenships. He was born in the Philippines of a Filipino
father and an American (U.S.) mother. However, his sworn application for alien registration dated 21
November 1979 (Exh. B) filed with the Philippine immigration authorities was, in my view, an express
renunciation of his Philippine citizenship. As held in Board of Immigration Commissioners vs.
Go Callano,[1] express renunciation means a renunciation that is made known distinctly and explicitly
and not left to inference or implication.
Nothing can be more distinct and explicit than when a dual citizenship holder - like the private
respondent - of age, and with full legal capacity to act, voluntarily and under oath
applies with the Philippine Government for registration as an alien, insofar as his intention not to
remain a Filipino citizen is concerned. And because of that distinct and explicit manifestation of
desire to be considered an alien in the Philippines, the Philippine immigration authorities issued to
private respondent Alien Certificate of Registration No. 015356 dated 21 November 1979 (Exh. C),
Permit to Re-enter the Philippines No. 122018 dated 21 November 1979 (Exh. D) and Immigration
Certificate of Clearance No. D-146483 dated 3 January 1980 (Exh. E).[2]
All the foregoing documents issued by the Philippine immigration authorities to the private respondent
at his request are predicated on the proposition that private respondent is an alien under Philippine
laws. It should also be mentioned that, while not marked as exhibit in the case at bar, private
respondent was likewise issued in Cebu City Native Born Certificate of Residence No. 115883 on 21
November 1979 (as verified from Immigration records). This document, copy of which is attached
hereto as Annex A, is again predicated on the proposition that private respondent is a duly-
registered alien American) residing in the Philippines.
Another relevant document that merits attention is the Application for Re-entry Permit executed and
signed by private respondent on 3 January 1980, again under oath, and verified from the records at
the CID, wherein private respondent expressly stated that he is a U.S. national. The importance of
this document cannot be underestimated. For, if private respondent believed that he is a Filipino
citizen, he would not have executed said Application for Re-entry Permit, since it is the right of every
Filipino citizen to return to his country (the Philippines). The fact, therefore, that private respondent
executed said sworn Application for Re-entry Permit, copy of which is attached hereto as Annex B, is
again abundant proof that he himself, no less, believed that he was, as he continuous to be,
a resident alien (American) in the Philippines.

108
It will further be noted that earlier, or in 1958, private
respondent had already registered as an alien with the Bureau of Immigration under the Alien
Registration Act of 1950 (RA 562). Section 1 of said Act provides:
"SECTION 1. Aliens residing in the Philippines shall, within thirty days after the approval of this Act,
apply for registration, in the case of those residing in the City of Manila, at the Bureau of Immigration
and in the case of those residing in other localities at the offices of the city or municpal treasurers, or
at any other office designated by the President. x x x."[3] (Emphasis supplied)
Accordingly, per certification of the Commissioner of Immigration and Deportation Miriam Defensor-
Santiago (Exh. A), issued on 26 January 1988, private respondent had been issued ACR No. B-21-
448 and ICR No. 13391 on 27 and 28 March 1958 respectively. He, therefore, registered
himself in the Philippines as an alien twice; first, in the year 1958, when he was 24 years old and
again in 1979, when he was 45 years old. By twice registering under oath as an alien with the
Bureau of Immigration, private respondent thereby clearly, distinctly and explicitly manifested and
declared that he was an alien (and, therefore, not a Filipino citizen) residing in the Philippines and
under its laws.
At this point, and to be objectively fair to the private respondent, a clarification should be made. In his
Comment on the Petition at bar (Rollo, p. 81), it is stated by his counsel that he (private respondent)
was born in 1934 hence, our mathematical conclusion that when he first registered as an alien in
1958, he was 24 years old and in 1979 when he re-registered as an alien, he was 45 years
old. However, private respondent's immigration records disclose that he was born in 1938 (not in
1934). On the assumption that the year 1938 is the correct year of birth of private respondent (and
that his alleged year of birth, 1934, as stated in his Comment at bar is erroneous), then in 1958, when
he first registered as an alien, he was 20 years old, while in 1979 when he re-registered as an alien,
he was 41 years old.
Still, his first registration as an alien (at age 20) has to be taken, in my view, as an express
renunciation of his Philippine citizenship, because (1) at that time, he was almost 21 years old - the
age of majority, and (2) more importantly, under the applicable Alien Registration Act (RA 562), an
alien 14 years or over has to register in person (and not through his parents or guardian). It provides:
"The parent or legal guardian of an alien who is less than fourteen years of age, shall have the duty of
registering such alien: Provided, That whenever any such alien attains his fourteenth birthday in the
Philippines he shall, within fifteen days thereafter, apply person for registration." (Sec. 1, par. 2)
I take the above provision to mean that the choice by a dual nationality holder on whether to remain a
Filipino citizen or an alien has to be made at age 14, and private respondent (although a bit late)
made the choice in 1958 (at age 20) in favor of his U.S citizenship.
If all the foregoing acts of express renunciation of Philippine citizenship had been made or filed by
private respondent elsewhere (not with the Philippine Government), there could perhaps be some
room for contention that vis-a-vis the Philippine Government, private respondent had not renounced
his Philippine citizenship. But said acts of express renunciation were filed with the Philippine
Government and done right in the Philippines. In turn, the Philippine Government, through the
immigration authorities, accepted and acted on private respondent's aforesaid representations, and
registered and documented him TWICE as an alien under Philippine law.
The policy of our laws has been, and with laudable reason, to discourage dual citizenship, because
this condition or status assumes as a necessary complement thereof dual allegiance at the same time
to two (2) different countries. As early as 16 September 1947, a unanimous Supreme Court,
speaking thru Mr. Justice Sabino Padilla in the celebrated case of Tan Chong vs. Secretary of
Labor, rejected the principle of jus soli as determinative of Philippine citizenship, for the following
reason, among others:
"x x x. Citizenship, the main integrate element of which is allegiance, must not be taken lightly. Dual
allegiance must be discouraged and prevented. But the application of the principle of jus soli to
persons born in this country of alien parentage would encourage dual allegiance which in the long run
would be detrimental to both countries of which such persons might claim to be citizens." [4]
This policy found later expression in the 1987 Constitution which now provides -
"Sec. 5. Dual allegiance of citizen is inimical to the national interest and shall be dealt with
by law." (Article IV)
Dual citizenship, in my considered opinion, must be eschewed. While having the "best of two (2)
worlds" maybe the result of birth or other factors accidentally brought about, the "dual citizen" has to
make a choice at one time or another. Having two (2) citizenships is, as I see it, similar in many ways
to having two (2) legal spouses, when as a matter of principle and sound public policy, fealty to only
one (1) spouse is both compelling and certainly desirable.
109
Gordon and Rosenfield in their book on Immigration Law and Procedure state:
"Dual nationality is universally recognized as an undesirable phenomenon. It inevitably results in
questionable loyalties and leads to international conflicts. x x x. Dual nationality also makes possible
the use of citizenship as a badge of convenience rather than of undivided loyalty. And it impairs the
singleness of commitment which is the hallmark of citizenship and allegiance. A person should have
a right to choose his own nationality, and this choice should be honored by all countries. However,
he should not be entitled to claim more than one nationality."[5] (Emphasis supplied)
Private respondent made a deliberate and decisive choice when he asked the Philippine Government
- which, like many other countries, considers dual allegiance as against national or public interest - to
register him at least twice (and, therefore, unmistakably) as an alien in this country. That
choice pro tanto was a renunciation of his Philippine citizenship. The choice must be respected as a
conscious and knowledgable act a discerning, distinguished and respected person who must be
presumed to have known the full import of his acts.
Finally, the last thing that should be said against the Court is that it is inconsistent in its rulings. In the
light of its recent decision in G.R. No. 86565 (Ramon L. Labo, Jr. vs. The Commission on Elections,
et al.), I see no valid justification for holding Mr. Labo an alien under Philippine law while holding
private respondent herein a Filipino citizen. For, as the majority states: "In fact, in a number of sworn
statements, Labo categorically declared that he was a citizen of Australia" (p. 7, Decision). And
that is exactly what private respondent did. In a number of sworn statements, he declared that he
was a citizen of the United States.
To Mr. Labo, the Court said, "so be it, you are an Australian," yet to the private respondent, despite
such sworn statements that he is a U.S. citizen, the Court says, "never mind those sworn statements,
you are still a Filipino." Sauce for the goose, as the saying goes, is sauce for the gander. The
doctrinal basis of the Court's decisions should be built on the merits, not on distinctions that really
make no difference.
ACCORDINGLY, I vote to GRANT the petition and to declare the private respondent not a Filipino
citizen by his own acts of express renunciation of such citizenship.

110
CIRILO R. VALLES v. COMELEC, GR No. 137000, 2000-08-09
Facts:
Rosalind Ybasco Lopez was born on May 16, 1934 in Napier Terrace, Broome, Western Australia, to
the spouses, Telesforo Ybasco, a Filipino citizen and native of Daet, Camarines Norte, and Theresa
Marquez, an Australian. In 1949, at the age of fifteen, she left Australia and... came to settle in the
Philippines.
June 27, 1952, she was married to Leopoldo Lopez, a Filipino citizen, at the Malate Catholic Church
in Manila
Since then, she has continuously participated in the electoral process not only as a voter but as a
candidate, as well
Her election was contested by her opponent, Gil Taojo, Jr., in a petition for quo warranto, docketed as
EPC No. 92-54, alleging as ground therefor her... alleged Australian citizenship... finding no sufficient
proof that respondent had renounced her Philippine citizenship, the Commission on Elections en
banc dismissed the petition
In the 1995 local elections, respondent Rosalind Ybasco Lopez ran for re-election as governor of
Davao Oriental. Her opponent, Francisco Rabat, filed a petition for disqualification... contesting her
Filipino... citizenship but the said petition was likewise dismissed by the COMELEC, reiterating
substantially its decision in EPC 92-54
The citizenship of private respondent was once again raised as an issue when she ran for re-election
as governor of Davao Oriental in the May 11, 1998 elections... questioned by the herein petitioner,
Cirilo Valles, in SPA No. 98-336
COMELEC's First Division came out with a Resolution dismissing the petition... petitioner herein has
presented no new evidence to disturb the Resolution of this Commission in SPA No. 95-066
Petitioner theorizes that under the aforestated facts and circumstances, the private respondent had
renounced her Filipino citizenship.
According to petitioner, for the private respondent to reacquire Philippine citizenship she must comply
with the... mandatory requirements for repatriation under Republic Act 8171; and the election of
private respondent to public office did not mean the restoration of her Filipino citizenship since the
private respondent was not legally repatriated. Coupled with her alleged renunciation of
Australian citizenship, private respondent has effectively become a stateless person and as such, is
disqualified to run for a public office in the Philippines; petitioner concluded.
Petitioner theorizes further that the Commission on Elections erred in applying the principle of res
judicata to the case under consideration
Petitioner also contends that even on the assumption that the private respondent is a Filipino citizen,
she has nonetheless renounced her Philippine citizenship. To buttress this contention, petitioner cited
private respondent's application for an Alien Certificate of
Registration (ACR) and Immigrant Certificate of Residence (ICR), on September 19, 1988, and the
issuance to her of an Australian passport on March 3, 1988.
Then, too, it is significant to note that on January 15 1992, private respondent executed a Declaration
of Renunciation of Australian Citizenship, duly registered in the Department of Immigration and Ethnic
Affairs of Australia on May 12, 1992. And, as a result, on February
11, 1992, the Australian passport of private respondent was cancelled
Since her renunciation was effective, petitioner's claim that private respondent must go through the
whole process of repatriation holds no water.
Issues:
Petitioner also maintains that even on the assumption that the private respondent had dual
citizenship, still, she is disqualified to run for governor of Davao Oriental;
111
Ruling:
The Commission on Elections ruled that private respondent Rosalind Ybasco Lopez is a Filipino
citizen and therefore, qualified to run for a public office... by virtue of the principle of jus sanguinis...
she was a Filipino citizen... she was married to a Filipino, thereby making her also a Filipino citizen
ipso jure under Section 4 of Commonwealth Act 473... she renounced her Australian citizenship on
January 15, 1992 before... the Department of Immigration and Ethnic Affairs of Australia and her
Australian passport was accordingly cancelled... there are the COMELEC Resolutions in EPC No. 92-
54 and SPA Case No. 95-066, declaring her... a Filipino citizen duly qualified to run for the elective
position of Davao Oriental governor
The petition is unmeritorious.
Historically, this was a year before... the 1935 Constitution took into effect and at that time, what
served as the Constitution of the Philippines were the principal organic acts by which the United
States governed the country. These were the Philippine Bill of July 1, 1902 and the Philippine
Autonomy Act of August
29, 1916, also known as the Jones Law.
all inhabitants of the Philippine Islands... and their children born subsequent thereto,... shall be
deemed and held to be citizens of the Philippine Islands... all inhabitants of the Philippine Islands who
were Spanish subjects on the eleventh day of April, eighteen hundred and ninety-nine, and then
resided in said Islands, and their children born subsequent thereto, shall be deemed and held to be
citizens of... the Philippine Islands
Private respondent's father, Telesforo Ybasco, was born on January 5, 1879 in Daet,... Camarines
Norte, a fact duly evidenced by a certified true copy of an entry in the Registry of Births. Thus, under
the Philippine Bill of 1902 and the Jones Law, Telesforo Ybasco was deemed to be a Philippine
citizen. By virtue of the same laws, which were the laws in force at... the time of her birth, Telesforo's
daughter, herein private respondent Rosalind Ybasco Lopez, is likewise a citizen of the Philippines
Thus, the mere fact that private respondent Rosalind Ybasco Lopez was a holder of an Australian
passport and had an alien certificate of registration are not acts constituting an effective renunciation
of citizenship and do not militate against her claim of Filipino... citizenship. For renunciation to
effectively result in the loss of citizenship, the same must be express.[8] As held by this court in the
aforecited case of Aznar, an application for an alien certificate of registration does not amount to an
express... renunciation or repudiation of one's citizenship. The application of the herein private
respondent for an alien certificate of registration, and her holding of an Australian passport, as in the
case of Mercado vs. Manzano, were mere acts of assertion of her Australian... citizenship before she
effectively renounced the same. Thus, at the most, private respondent had dual citizenship - she was
an Australian and a Filipino, as well.
Again, petitioner's contention is untenable.
The filing of a certificate of candidacy sufficed to renounce foreign citizenship, effectively removing
any disqualification as a dual citizen.
Principles:
The Philippine law on citizenship adheres to the principle of jus sanguinis. Thereunder, a child follows
the nationality or citizenship of the parents regardless of the place of his/her birth, as opposed to the
doctrine of jus soli which determines... nationality or citizenship on the basis of place of birth.
MARY GRACE NATIVIDAD S. POE-LLAMANZARES v. COMELEC, GR No. 221697, 2016-03-08
Facts:
Mary Grace Natividad S. Poe-Llamanzares (petitioner) was found abandoned as a newborn infant in
the Parish Church of Jaro, Iloilo by a certain Edgardo Militar (Edgardo) on 3 September 1968.
Parental care and custody over petitioner was passed on by Edgardo to his relatives, Emiliano Militar
(Emiliano) and his wife
In her Foundling Certificate and Certificate of Live Birth, the petitioner was given the name "Mary
Grace Natividad Contreras Militar."
When petitioner was five (5) years old, celebrity spouses Ronald Allan Kelley Poe (a.k.a. Fenando
Poe, Jr.) and Jesusa Sonora Poe (a.k.a. Susan Roces) filed a petition for her adoption with the
Municipal Trial Court (MTC) of San Juan City.
112
Having reached the age of eighteen (18) years in 1986, petitioner registered as a voter with the local
COMELEC Office in San Juan City. On 13 December 1986, she received her COMELEC Voter's
Identification Card
On 4 April 1988, petitioner applied for and was issued Philippine Passport No. F927287[6] by the
Department of Foreign Affairs (DFA). Subsequently, on 5 April 1993 and 19 May 1998, she renewed
her Philippine passport and respectively secured Philippine Passport Nos. L881511 and DD156616...
petitioner married Teodoro Misael Daniel V. Llamanzares (Llamanzares), a citizen of both the
Philippines and the U.S., at Sanctuario de San Jose Parish in San Juan City.[10] Desirous of being
with her husband who was then based in the U.S., the couple flew back to the U.S. two days after the
wedding ceremony or on 29 July 1991
In her earnest desire to be with her grieving mother, the petitioner and her husband decided to move
and reside permanently in the Philippines sometime in the first quarter of 2005.[19] The couple began
preparing for their resettlement including notification of their children's schools that they will be
transferring to Philippine schools for the next semester;[20] coordination with property movers for the
relocation of their household goods, furniture and cars from the U.S. to the Philippines;... petitioner
came home to the Philippines on 24 May 2005[24] and without delay, secured a Tax Identification
Number from the Bureau of Internal Revenue
On 7 July 2006, petitioner took her Oath of Allegiance to the Republic of the Philippines pursuant to
Republic Act (R.A.) No. 9225 or the Citizenship Retention and Re-acquisition Act of 2003.
nder the same Act, she filed with the Bureau of Immigration (BI) a sworn petition to reacquire
Philippine citizenship together with petitions for derivative citizenship on behalf of her three minor
children on 10 July 2006.
the BI acted favorably on petitioner's petitions and declared that she is deemed to have reacquired
her Philippine citizenship while her children are considered as citizens of the Philippines... efore
assuming her post, petitioner executed an "Affidavit of Renunciation of Allegiance to the United
States of America and Renunciation of American Citizenship" before a notary public in Pasig City on
20 October 2010
On 12 July 2011, the petitioner executed before the Vice Consul of the U.S. Embassy in Manila an
"Oath/Affirmation of Renunciation of Nationality of the United States.
On 2 October 2012, the petitioner filed with the COMELEC her Certificate of Candidacy (COC) for
Senator for the 2013 Elections wherein she answered "6 years and 6 months" to the question "Period
of residence in the Philippines before May 13, 2013."[53] Petitioner obtained the highest number of
votes and was proclaimed Senator on 16 May 2013.
On 15 October 2015, petitioner filed her COC for the Presidency for the May 2016 Elections.[56] In
her COC, the petitioner declared that she is a natural-born citizen and that her residence in the
Philippines up to the day before 9 May 2016 would be ten (10) years and eleven (11) months counted
from 24 May 2005
Elamparo argued that petitioner cannot be considered as a natural-born Filipino on account of the fact
that she was a foundling.[62] Elamparo claimed that international law does not confer natural born
status and Filipino citizenship on foundlings
Tatad theorized that since the Philippines adheres to the principle of jus sanguinis, persons of
unknown parentage, particularly foundlings, cannot be considered natural-born Filipino citizens since
blood relationship is determinative of natural-born status.[
Issues:
whether or not the COC of petitioner should be denied due course or cancelled "on the exclusive
ground" that she made in the certificate a false material representation.
Can the COMELEC be such judge?
Ruling:
Other circumstantial evidence of the nationality of petitioner's parents are the fact that she was
abandoned as an infant in a Roman Catholic Church in Iloilo City. She also has typical Filipino
features: height, flat nasal bridge, straight black hair, almond shaped eyes and an oval face.
All of the foregoing evidence, that a person with typical Filipino features is abandoned in Catholic
Church in a municipality where the population of the Philippines is overwhelmingly Filipinos such that
there would be more than a 99% chance that a child born in the province would be a Filipino, would
indicate more than ample probability if not statistical certainty, that petitioner's parents are Filipinos.

113
To deny full Filipino citizenship to all foundlings and render them stateless just because there may be
a theoretical chance that one among the thousands of these foundlings might be the child of not just
one, but two, foreigners is downright discriminatory, irrational, and unjust. It just doesn't make any
sense. Given the statistical certainty 99.9% - that any child born in the Philippines would be a natural
born citizen, a decision denying foundlings such status is effectively a denial of their birthright.
As a matter of law, foundlings are as a class, natural-born citizens. While the 1935 Constitution's
enumeration is silent as to foundlings, there is no restrictive language which would definitely exclude
foundlings either
That the Philippines is not a party to the 1930 Hague Convention nor to the 1961 Convention on the
Reduction of Statelessness does not mean that their principles are not binding. While the Philippines
is not a party to the 1930 Hague Convention, it is a signatory to the Universal Declaration on Human
Rights, Article 15(1) of which[131] effectively affirms Article 14 of the 1930 Hague Convention. Article
2 of the 1961 "United Nations Convention on the Reduction of Statelessness" merely "gives effect" to
Article 15(1) of the UDHR.
In sum, all of the international law conventions and instruments on the matter of nationality of
foundlings were designed to address the plight of a defenseless class which suffers from a misfortune
not of their own making. We cannot be restrictive as to their application if we are a country which calls
itself civilized and a member of the community of nations.
It was grave abuse of discretion for the COMELEC to treat the 2012COC as a binding and conclusive
admission against petitioner.
The COMELEC, by its own admission, disregarded the evidence that petitioner actually and
physically returned here on 24 May 2005 not because it was false, but only because COMELEC took
the position that domicile could be established only from petitioner's repatriation under R.A. No. 9225
in July 2006. However, it does not take away the fact that in reality, petitioner had returned from the
U.S. and was here to stay permanently, on 24 May 2005. When she claimed to have been a resident
for ten (10) years and eleven (11) months, she could do so in good faith.
In sum, the COMELEC, with the same posture of infallibilism, virtually ignored a good number of
evidenced dates all of which can evince animus manendi to the Philippines and animus non revertedi
to the United States of America. The veracity of the events of coming and staying home was as much
as dismissed as inconsequential, the focus having been fixed at the petitioner's "sworn declaration in
her COC for Senator" which the COMELEC said "amounts to a declaration and therefore an
admission that her residence in the Philippines only commence sometime in November 2006"; such
that "based on this declaration, [petitioner] fails to meet the residency requirement for President." This
conclusion, as already shown, ignores the standing jurisprudence that it is the fact of residence, not
the statement of the person that determines residence for purposes of compliance with the
constitutional requirement of residency for election as President. It ignores the easily researched
matter that cases on questions of residency have been decided favorably for the candidate on the
basis of facts of residence far less in number, weight and substance than that presented by petitioner.
[169] It ignores, above all else, what we consider as a primary reason why petitioner cannot be bound
by her declaration in her COC for Senator which declaration was not even considered by the SET as
an issue against her eligibility for Senator. When petitioner made the declaration in her COC for
Senator that she has been a resident for a period of six (6) years and six (6) months counted up to
the 13 May 2013 Elections, she naturally had as reference the residency requirements for election as
Senator which was satisfied by her declared years of residence. It was uncontested during the oral
arguments before us that at the time the declaration for Senator was made, petitioner did not have as
yet any intention to vie for the Presidency in 2016 and that the general public was never made aware
by petitioner, by word or action, that she would run for President in 2016. Presidential candidacy has
a length-of-residence different from that of a senatorial candidacy. There are facts of residence other
than that which was mentioned in the COC for Senator.
In light of all these, it was arbitrary for the COMELEC to satisfy its intention to let the case fall under
the exclusive ground of false representation, to consider no other date than that mentioned by
petitioner in her COC for Senator.
All put together, in the matter of the citizenship and residence of petitioner for her candidacy as
President of the Republic, the questioned Resolutions of the COMELEC in Division and En Banc are,
one and all, deadly diseased with grave abuse of discretion from root to fruits.
WHEREFORE, the petition is GRANTED
[T]he Certificate of Candidacy for President of the Republic of the Philippines in the May 9, 2016
National and Local Elections filed by respondent Mary Grace Natividad Sonora Poe-Llamanzares is
hereby GRANTED.

114
Petitioner MARY GRACE NATIVIDAD SONORA POE-LLAMANZARES is DECLARED QUALIFIED to
be a candidate for President in the National and Local Elections of 9 May 2016.
Principles:
The Supreme Court, sitting en banc, shall be the sole judge of all contests relating to the election,
returns, and qualifications of the President or Vice-President, and may promulgate its rules for the
purpose.
Grounds for disqualification. - Any candidate who does not possess all the qualifications of a
candidate as provided for by the Constitution or by existing law or who commits any act declared by
law to be grounds for disqualification may be disqualified from continuing as a candidate.
It is noteworthy that the Constitution withholds from the COMELEC even the power to decide cases
involving the right to vote, which essentially involves an inquiry into qualifications based on age,
residence and citizenship of voters.
Disqualification" proceedings, as already stated, are based on grounds specified in §12 and §68 of
the Omnibus Election Code and in §40 of the Local Government Code and are for the purpose of
barring an individual from becoming a candidate or from continuing as a candidate for public office. In
a word, their purpose is to eliminate a candidate from the race either from the start or during its
progress.
"Ineligibility," on the other hand, refers to the lack of the qualifications prescribed in the Constitution or
the statutes for holding public office and the purpose of the proceedings for declaration of ineligibility
is to remove the incumbent from office.
First is the fact that unless a candidate wins and is proclaimed elected, there is no necessity for
determining his eligibility for the office. In contrast, whether an individual should be disqualified as a
candidate for acts constituting election offenses (e.g., vote buying, over spending, commission of
prohibited acts) is a prejudicial question which should be determined lest he wins because of the very
acts for which his disqualification is being sought.
Second is the fact that the determination of a candidates' eligibility, e.g., his citizenship or, as in this
case, his domicile, may take a long time to make, extending beyond the beginning of the term of the
office.
where the determination of Aquino s residence was still pending in the COMELEC even after the
elections of May 8, 1995. This is contrary to the summary character proceedings relating to
certificates of candidacy. That is why the law makes the receipt of certificates of candidacy a
ministerial duty of the COMELEC and its officers.
The law is satisfied if candidates state in their certificates of candidacy that they are eligible for the
position which they seek to fill, leaving the determination of their qualifications to be made after the
election and only in the event they are elected. Only in cases involving charges of false
representations made in certificates of candidacy is the COMELEC given jurisdiction.
Third is the policy underlying the prohibition against pre proclamation cases in elections for President,
Vice President, Senators and members of the House of Representatives. (R.A. No. 7166, § 15) The
purpose is to preserve the prerogatives of the House of Representatives Electoral Tribunal and the
other Tribunals as "sole judges" under the Constitution of the election, returns and qualifications of
members of Congress of the President and Vice President, as the case may be.

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