Republic of the Philippines SUPREME COURT Manila EN BANC March 29, 1954 GRNo!"#$91 THE PEOPLE OF THE PHILIPPINES,plaintiff"appellee, %sQUE PO LAY,&efen&ant"appellant Prudencio de Guzman for appellant. First Assistant Solicitor General Ruperto Kapunan, Jr., and Solicitor Lauro G. Marquez for appellee. MONTEMAYOR, J.: 'ue Po !a( is appealin) fro* the &ecision of the Court of +irst nstance of Manila, fin&in) hi* )uilt( of %iolatin) Central Ban- Circular No2. in connection /ith section 04 ofRepublic Act No. 265, an& sentencin) hi* to suffer si*onths i*prison*ent, to pa( a fine of P1,... /ith subsi&iar( i*prison*ent in case of insol%enc( , an& to pa( the costshe char)e /as that the appellant /ho /as in possession of forei)n echan)e consistin) of 3&ollars, 3chec-s an& 3*one( or&ers a*ountin) to about $,... faile& to sell the sa*e to the Central Ban- throu)h its a)ents /ithin one &a( follo/in) the receipt of such forei)n echan)e as re6uire& b ( Circular No2.the appeal is base& on the clai* that sai& circular No2. /as not publishe& in the 7fficial Ga8ette prior to the act or o*ission i*pute& to the appellant, an& that conse6uentl( , sai& circular ha& no force an& effectt is conten&e& that Co**on/ealth ActNo, #0an& Act 290. both re6uire sai& circular to be publishe& in the 7fficial Ga8et te, it bein) an or&er or not ice of )eneral applicabil it(he olicitor General ans/erin) this contention sa(s that Co**on/ealth ActNo#0an& 290. &o not re6uire the publication in t he 7fficial Ga8ette o f sai& circular issue& for th e i*ple*entation of a la/ in o r&er to ha%e force an& effect:e a)ree /ith the olicitor General that the la/s in 6uestion &o not re6uire the publication of the circulars, re)ulations an& notices therein *entione& in or&er to beco*e bin&in) an& effecti%eAll that sai& t/o la/s pro%i&e is that la/s, resolutions, &ecisions of the upre*e Court an& Court of Appeals, notices an& &ocu*ents re6uire& b( la/ to be of no force an& effectn other /or&s, sai& t/o Acts *erel( enu*erate an& *a-e a list of /hat shoul& be publishe& in the Page 1of 49
T"E "ON. SECRET!R# O$ E%UC!TION, ET !L., respondents-appellees.
K. V. Faylona and Juan B. Soliven for appellants.
Office of the Solicitor General Edilberto Barot and Solicitor Ceferino Padua for appellees.
RE#ES, &..L., J.:
Appeal by members of the !ehovah"s #itnesses from a decision of the Court of $irst %nstance of Capi&,
dated !une '(, )*+, dismissin their petition for prohibition and mandamus aainst the ecretary ofEducation and the other respondents.
/he action 0as brouht to en1oin the enforcement of 2epartment 3rder No. , s. )*++, issued by the
ecretary of Education, promulatin rules and reulations for the conduct of the compulsory fla ceremony
in all schools, as provided in Republic Act No. )'4+. Petitioners appellants assail the validity of the above
2epartment 3rder, for it alleedly denies them freedom of 0orship and of speech uaranteed by the Bill of
Rihts5 that it denies them due process of la0 and the e6ual protection of the la0s5 and that it unduly restricts
their rihts in the upbrinin of their children. ince the brief for the petitioners-appellants assails Republic Act
No. )'4+ only as construed and applied, the issue ultimately boils do0n the validity of 2epartment 3rder No.
, s. )*++, 0hich promulated the rules and reulations for the implementation of the la0.
/his case, therefore, is on all fours 0ith Gerona et al. vs. Secretary of Education et al ., )74 Phil., '5 +8 3ff.
9a&., :+; '7, also involvin !ehovah"s #itnesses, and assailin, on practically identical rounds, the validity
of the same 2epartment 3rder above-mentioned. /his Court discerns no reasons for chanin its stand
therein, 0here 0e said<
%n conclusion, 0e find and hold that the $ilipino fla is not an imae that re6uires reliious veneration5
rather, it is a symbol of the Republic of the Philippines, of sovereinty, an emblem of freedom, liberty
and national unity5 that the fla salute is not a reliious ceremony but an act and profession of love
and alleiance and plede of loyalty to the fatherland 0hich the fla stands for5 that by the authority of
the =eislature of the ecretary of Education 0as duly authori&ed to promulate 2epartment 3rderNo. , series of )*++5 that the re6uirement of observance of the fla ceremony, or salute provided for
in said 2epartment 3rder No. does not violate the Constitutional provisions about freedom of reliion
and e>ercise of reliion5 that compliance 0ith the non-discriminatory and reasonable rules and
reulations and school discipline, includin observance of the fla ceremony, is a prere6uisite to
attendance in public schools5 and that for failure and refusal to participate in the fla ceremony,
petitioners 0ere properly e>cluded and dismissed from the public school they 0ere attendin.
?o0ever, in their memorandum, petitioners-appellants raise the ne0 issue that that 2epartment 3rder No.
has no bindin force and effect, not havin been published in the 3fficial 9a&ette as alleedly re6uired by
Common0ealth Act 4(, Article ' of the Ne0 Civil Code, and ection )) of the Revised Administrative Code.
#e see no merit in this contention. /he assailed 2epartment 3rder, bein addressed only to the 2irectors of
Public and Private chools, and educational institutions under their supervision, can not be said to be of
eneral application. Moreover, as observed in People vs. @uePo =ay, * Phil., 475 +7 3ff. 9a&., :)7; +7
:affirmed in =im ?oa /in vs. Central Ban, )7 Phil., +8(5 ++ 3ff. 9a&., 4D )774;,
the la0s in 6uestion :Common0ealth Act 4( and Act '*(7; do not re6uire the publication of the
circulars, reulations or notices therein mentioned in order to become bindin and effective. All thatsaid t0o la0s provide is that la0s, reulations, decisions of the upreme Court and Court of Appeals,
notices and documents re6uired by la0 to be published shall be published in the 3fficial 9a&ette but
said t0o la0s do not say that unless so published they 0ill be of no force and effect. %n other 0ords,
said t0o acts merely enumerate and mae a list of 0hat should be published in the 3fficial 9a&ette,
presumably, for the uidance of the different branches of the overnment issuin the same, and of the
Bureau of Printin.
%t is true, as held in the above cases, that pursuant to Article ' of the Ne0 Civil Code and ection )) of the
Revised Administrative Code, statutes or la0s shall tae effect fifteen days follo0in the completion of their
publication in the 3fficial 9a&ette, unless other0ise provided. %t is lie0ise true that administrative rules and
reulations, issued to implement a la0, have the force of la0. Nevertheless, the cases cited above involvedcirculars of the Central Ban 0hich provided for penalties for violations thereof and that 0as the primary factor
that influenced the rationale of those decisions. %n the case at bar, 2epartment 3rder No. does not provide
any penalty aainst those pupils or students refusin to participate in the fla ceremony or other0ise violatin
the provisions of said order. /heir e>pulsion 0as merely the conse6uence of their failure to observe school
discipline 0hich the school authorities are bound to maintain. As observed in 9erona vs. ecretary of
Education, supra,
... for their failure or refusal to obey school reulations about the fla salute, they 0ere not bein
prosecuted. Neither 0ere they bein criminally prosecuted under threat of penal sanction. %f they
choose not to obey the fla salute reulation, they merely lost the benefits of public education bein
maintained at the e>pense of their fello0 citi&ens, nothin more. ?avin elected not to comply 0ith the
reulations about the fla salute, they forfeited their riht to attend public schools.
$inally, appellants contend that Republic Act No. )'4+ is unconstitutional and void for bein an undue
deleations of leislative po0er, for its failure to lay do0n any specific and definite standard by 0hich the
ecretary of Education may be uided in the preparation of those rules and reulations 0hich he has been
authori&ed to promulate. #ith this vie0 0e aain disaree. ections ) and ' of the Act read as follo0s<
ection ). All educational institutions shall henceforth, observed daily fla ceremony, 0hich shall be
simple and dinified and shall include the playin or sinin of the Philippine National Anthem.
ection '. /he ecretary of Education is hereby authori&ed and directed to issue or cause to be issued
rules and reulations for the proper conduct of the fla ceremony herein provide.
%n our opinion, the re6uirements above-6uoted constitute an ade6uate standard, to 0it, simplicity and dinity
of the fla ceremony and the sinin of the National Anthem specially 0hen contrasted 0ith other
standards heretofore upheld by the Courts< public interest:People vs. Rosenthal, 4 Phil. (';5 public
0elfare :Municipality of Cardona vs. Binanonan, (4 Phil. +8;5 %nterest of la0 and order:Rubi vs. Provincial
Board, (* Phil., 44*5 1ustice and e6uity and the substantial merits of the case :%nt. ?ard0ood vs. PaFil
$ederation of =abor, 87 Phil. 47';5 or ade6uate and efficient instruction :P.A.C.G. vs. ecretary of Education,
T"E "ON. SECRET!R# O$ E%UC!TION, ET !L., respondents-appellees.
K. V. Faylona and Juan B. Soliven for appellants.
Office of the Solicitor General Edilberto Barot and Solicitor Ceferino Padua for appellees.
RE#ES, &..L., J.:
Appeal by members of the !ehovah"s #itnesses from a decision of the Court of $irst %nstance of Capi&,
dated !une '(, )*+, dismissin their petition for prohibition and mandamus aainst the ecretary ofEducation and the other respondents.
/he action 0as brouht to en1oin the enforcement of 2epartment 3rder No. , s. )*++, issued by the
ecretary of Education, promulatin rules and reulations for the conduct of the compulsory fla ceremony
in all schools, as provided in Republic Act No. )'4+. Petitioners appellants assail the validity of the above
2epartment 3rder, for it alleedly denies them freedom of 0orship and of speech uaranteed by the Bill of
Rihts5 that it denies them due process of la0 and the e6ual protection of the la0s5 and that it unduly restricts
their rihts in the upbrinin of their children. ince the brief for the petitioners-appellants assails Republic Act
No. )'4+ only as construed and applied, the issue ultimately boils do0n the validity of 2epartment 3rder No.
, s. )*++, 0hich promulated the rules and reulations for the implementation of the la0.
/his case, therefore, is on all fours 0ith Gerona et al. vs. Secretary of Education et al ., )74 Phil., '5 +8 3ff.
9a&., :+; '7, also involvin !ehovah"s #itnesses, and assailin, on practically identical rounds, the validity
of the same 2epartment 3rder above-mentioned. /his Court discerns no reasons for chanin its stand
therein, 0here 0e said<
%n conclusion, 0e find and hold that the $ilipino fla is not an imae that re6uires reliious veneration5
rather, it is a symbol of the Republic of the Philippines, of sovereinty, an emblem of freedom, liberty
and national unity5 that the fla salute is not a reliious ceremony but an act and profession of love
and alleiance and plede of loyalty to the fatherland 0hich the fla stands for5 that by the authority of
the =eislature of the ecretary of Education 0as duly authori&ed to promulate 2epartment 3rderNo. , series of )*++5 that the re6uirement of observance of the fla ceremony, or salute provided for
in said 2epartment 3rder No. does not violate the Constitutional provisions about freedom of reliion
and e>ercise of reliion5 that compliance 0ith the non-discriminatory and reasonable rules and
reulations and school discipline, includin observance of the fla ceremony, is a prere6uisite to
attendance in public schools5 and that for failure and refusal to participate in the fla ceremony,
petitioners 0ere properly e>cluded and dismissed from the public school they 0ere attendin.
?o0ever, in their memorandum, petitioners-appellants raise the ne0 issue that that 2epartment 3rder No.
has no bindin force and effect, not havin been published in the 3fficial 9a&ette as alleedly re6uired by
Common0ealth Act 4(, Article ' of the Ne0 Civil Code, and ection )) of the Revised Administrative Code.
#e see no merit in this contention. /he assailed 2epartment 3rder, bein addressed only to the 2irectors of
Public and Private chools, and educational institutions under their supervision, can not be said to be of
eneral application. Moreover, as observed in People vs. @uePo =ay, * Phil., 475 +7 3ff. 9a&., :)7; +7
:affirmed in =im ?oa /in vs. Central Ban, )7 Phil., +8(5 ++ 3ff. 9a&., 4D )774;,
the la0s in 6uestion :Common0ealth Act 4( and Act '*(7; do not re6uire the publication of the
circulars, reulations or notices therein mentioned in order to become bindin and effective. All thatsaid t0o la0s provide is that la0s, reulations, decisions of the upreme Court and Court of Appeals,
notices and documents re6uired by la0 to be published shall be published in the 3fficial 9a&ette but
said t0o la0s do not say that unless so published they 0ill be of no force and effect. %n other 0ords,
said t0o acts merely enumerate and mae a list of 0hat should be published in the 3fficial 9a&ette,
presumably, for the uidance of the different branches of the overnment issuin the same, and of the
Bureau of Printin.
%t is true, as held in the above cases, that pursuant to Article ' of the Ne0 Civil Code and ection )) of the
Revised Administrative Code, statutes or la0s shall tae effect fifteen days follo0in the completion of their
publication in the 3fficial 9a&ette, unless other0ise provided. %t is lie0ise true that administrative rules and
reulations, issued to implement a la0, have the force of la0. Nevertheless, the cases cited above involvedcirculars of the Central Ban 0hich provided for penalties for violations thereof and that 0as the primary factor
that influenced the rationale of those decisions. %n the case at bar, 2epartment 3rder No. does not provide
any penalty aainst those pupils or students refusin to participate in the fla ceremony or other0ise violatin
the provisions of said order. /heir e>pulsion 0as merely the conse6uence of their failure to observe school
discipline 0hich the school authorities are bound to maintain. As observed in 9erona vs. ecretary of
Education, supra,
... for their failure or refusal to obey school reulations about the fla salute, they 0ere not bein
prosecuted. Neither 0ere they bein criminally prosecuted under threat of penal sanction. %f they
choose not to obey the fla salute reulation, they merely lost the benefits of public education bein
maintained at the e>pense of their fello0 citi&ens, nothin more. ?avin elected not to comply 0ith the
reulations about the fla salute, they forfeited their riht to attend public schools.
$inally, appellants contend that Republic Act No. )'4+ is unconstitutional and void for bein an undue
deleations of leislative po0er, for its failure to lay do0n any specific and definite standard by 0hich the
ecretary of Education may be uided in the preparation of those rules and reulations 0hich he has been
authori&ed to promulate. #ith this vie0 0e aain disaree. ections ) and ' of the Act read as follo0s<
ection ). All educational institutions shall henceforth, observed daily fla ceremony, 0hich shall be
simple and dinified and shall include the playin or sinin of the Philippine National Anthem.
ection '. /he ecretary of Education is hereby authori&ed and directed to issue or cause to be issued
rules and reulations for the proper conduct of the fla ceremony herein provide.
%n our opinion, the re6uirements above-6uoted constitute an ade6uate standard, to 0it, simplicity and dinity
of the fla ceremony and the sinin of the National Anthem specially 0hen contrasted 0ith other
standards heretofore upheld by the Courts< public interest:People vs. Rosenthal, 4 Phil. (';5 public
0elfare :Municipality of Cardona vs. Binanonan, (4 Phil. +8;5 %nterest of la0 and order:Rubi vs. Provincial
Board, (* Phil., 44*5 1ustice and e6uity and the substantial merits of the case :%nt. ?ard0ood vs. PaFil
$ederation of =abor, 87 Phil. 47';5 or ade6uate and efficient instruction :P.A.C.G. vs. ecretary of Education,
T"E ETER!NS $E%ER!TION O$ T"E P"ILIPPINES reree/e b+ Emer*o R. !or*, Petitioner,vs."o/. !NGELO T. RE#ES / 5 **+ * Sere*r+ o N*o/* %ee/e7 */ "o/. E%G!R%O E.!TENG! / 5 **+ * U/erere*r+ or Cv Re*o/ */ !m/r*o/ o 5e %e*rme/o N*o/* %ee/e, Respondents.
2 E C % % 3 N
C"ICO-N!!RIO, J.:
/his is a Petition for Certiorari 0ith Prohibition under Rule 4+ of the )**8 Rules of Civil Procedure, 0ith aprayer to declare as void 2epartment Circular No. 7 of the 2epartment of National 2efense :2N2;, dated )7!une '77'.
Petitioner in this case is the Heterans $ederation of the Philippines :H$P;, a corporate body orani&ed underRepublic Act No. '47, dated ) !une )*47, as amended, and duly reistered 0ith the ecurities andE>chane Commission. Respondent Anelo /. Reyes 0as the ecretary of National 2efense :2N2 ecretary;0ho issued the assailed 2epartment Circular No. 7, dated )7 !une '77'. Respondent Edardo E. Batena0as the 2N2 Gndersecretary for Civil Relations and Administration 0ho 0as tased by the respondent 2N2ecretary to conduct an e>tensive manaement audit of the records of petitioner.
/he factual and procedural antecedents of this case are as follo0s<
Petitioner H$P 0as created under Rep. Act No. '47,) a statute approved on ) !une )*47.
3n )+ April '77', petitionerIs incumbent president received a letter dated )( April '77' 0hich reads<
Col. Emmanuel H. 2e 3campo :Ret.;
President
Heterans $ederation of the Philippines
Maati, Metro Manila
2ear Col. 2e 3campo<
Please be informed that durin the preparation of my briefin before the Cabinet and the President last March*, '77', 0e came across some leal bases 0hich tended to sho0 that there is an orani&ational andmanaement relationship bet0een Heterans $ederation of the Philippines and the Philippine Heterans Ban0hich for many years have been inadvertently overlooed.
% refer to Republic Act '47 creatin the body corporate no0n as the H$P and Republic Act (+) creatin thePhil. Hets sicD Ban.
). RA '47 dated ) !une 47 ection ) ... hereby created a body corporate, under the control andsupervision of the ecretary of National 2efense.
'. RA '47 ection )' ... 3n or before the last day of the month follo0in the end of each fiscal year,the $ederation shall mae and transmit to the President of the Philippines or to the ecretary ofNational 2efense, a report of its proceedins for the past year, includin a full, complete and itemi&edreport of receipts and e>penditures of 0hatever ind.
(. Republic Act (+) dated ) !une )*4( :An Act Creatin the Philippine Heterans Ban, and for 3therPurposes; provides in ection 4 that ... the affairs and business of the Philippine Heterans Ban shallbe directed and its property manaed, controlled and preserved, unless other0ise provided in this Act,by a Board of 2irectors consistin of eleven :)); members to be composed of three e> officiomembers to 0it< the Philippine Heterans Administrator, the President of the HeteranIs $ederation of thePhilippines and the ecretary of National 2efense > > >.
%t is therefore in the conte>t of clarification and rectification of 0hat should have been done by the 2N2:2epartment of National 2efense; for and about the H$P and PHB that % am re6uestin appropriateinformation and report about these t0o corporate bodies.
/herefore it may become necessary that a conference 0ith your staffs in these t0o bodies be set.
/han you and anticipatin your action on this re6uest.
Hery truly yours,
:92; AN9E=3 /. REJE
2N2D ecretary
3n )7 !une '77', respondent 2N2 ecretary issued the assailed 2N2 2epartment Circular No. 7 entitled,$urther %mplementin the Provisions of ections )' and '( of Republic Act No. '47, the full te>t of 0hichappears as follo0s<
2epartment of National 2efense
2epartment Circular No. 7
ub1ect< $urther %mplementin the Provisions of ections ) K ' of
Republic Act No. '47
Authority< Republic Act No. '47
E>ecutive 3rder No. '*' dated !uly '+, )*8
ection )
/hese rules shall overn and apply to the manaement and operations of the Heterans $ederation of thePhilippines :H$P; 0ithin the conte>t provided by E3 '*' s-)*8.
ection ' L 2E$%N%/%3N 3$ /ERM L for the purpose of these rules, the terms, phrases or 0ords usedherein shall, unless the conte>t indicates other0ise, mean or be understood as follo0s<
upervision and Control L it shall include authority to act directly 0henever a specific function is entrusted byla0 or reulation to a subordinate5 direct the performance of a duty5 restrain the commission of acts5 approve,reverse or modify acts and decisions of subordinate officials or units5 determine priorities in the e>ecution ofplans and prorams5 and prescribe standards, uidelines, plans and prorams.
Po0er of Control L po0er to alter, modify, nullify or set aside 0hat a subordinate officer had done in theperformance of his duties and to substitute the 1udment of the former to that of the latter.
upervision L means overseein or the po0er of an officer to see to it that their subordinate officers performtheir duties5 it does not allo0 the superior to annul the acts of the subordinate.
Administrative Process L embraces matter concernin the procedure in the disposition of both routine andcontested matters, and the matter in 0hich determinations are made, enforced or revie0ed.
9overnment Aency L as defined under P2 )+, a overnment aency or aency of overnment oraency refers to any department, bureau or office of the national overnment, or any of its branches orinstrumentalities, of any political subdivision, as 0ell as any overnment o0ned or controlled corporation,includin its subsidiaries, or other self-overnin board or commission of the overnment.
9overnment 30ned and Controlled Corporation :93CC; L refer to any aency orani&ed as a stoc or non-
stoc corporation, vested 0ith functions relatin to public needs 0hether overnmental or proprietary innature, and o0ned by the overnment directly or throuh its instrumentalities 0holly or, 0here applicable as inthe case of stoc corporations, to the e>tent of at least +7 of its capital stoc.
$und L sum of money or other resources set aside for the purpose of carryin out specific activities orattainin certain ob1ectives in accordance 0ith special reulations, restrictions or limitations and constitutes anindependent, fiscal and accountin entity.
9overnment $und L includes public monies of every sort and other resources pertainin to any aency of theovernment.
Heteran L any person 0ho rendered military service in the land, sea or air forces of the Philippines durin therevolution aainst pain, the Philippine American #ar, #orld #ar %%, includin $ilipino citi&ens 0ho served in
Allied $orces in the Philippine territory and forein nationals 0ho served in Philippine forces5 the oreancampain, the Hietnam campain, the Anti-dissidence campain, or other 0ars or military campains5 or 0horendered military service in the Armed $orces of the Philippines and has been honorably dischared orseparated after at least si> :4; years total cumulative active service or sooner separated due to the death ordisability arisin from a 0ound or in1ury received or sicness or disease incurred in line of duty 0hile in theactive service.
ection ( L Relationship Bet0een the 2N2 and the H$P
(.) ec ) of RA ()7 provides ... the follo0in persons :heads of various veterans associations andorani&ations in the Philippines; and their associates and successors are hereby created a body corporate,under the control and supervision of the ecretary of National 2efense, under the name, style and title ofHeterans $ederation of the Philippines ...
/he ecretary of National 2efense shall be chared 0ith the duty of supervisin the veterans and alliedproram under the 1urisdiction of the 2epartment. %t shall also have the responsibility of overseein andensurin the 1udicious and effective implementation of veterans assistance, benefits, and utili&ation of H$Passets.
(.' /o effectively supervise and control the corporate affairs of the $ederation and to safeuard the interestsand 0elfare of the veterans 0ho are also 0ards of the tate entrusted under the protection of the 2N2, theecretary may personally or throuh a desinated representative, re6uire the submission of reports,
documents and other papers reardin any or all of the $ederationIs business transactions particularly thoserelatin to the H$P functions under ection ' of RA '47.
/he ecretary or his representative may attend conferences of the supreme council of the H$P and suchother activities he may deem relevant.
(.( /he ecretary shall from time to time issue uidelines, directives and other orders overnin vitalovernment activities includin, but not limited to, the conduct of elections5 the ac6uisition, manaement and
dispositions of properties, the accountin of funds, financial interests, stocs and bonds, corporateinvestments, etc. and such other transactions 0hich may affect the interests of the veterans.
(. $inancial transactions of the $ederation shall follo0 the provisions of the overnment auditin code :P2)+; i.e. overnment funds shall be spent or used for public purposes5 trust funds shall be available and maybe spent only for the specific purpose for 0hich the trust 0as created or the funds received5 fiscalresponsibility shall, to the reatest e>tent, be shared by all those e>ercisin authority over the financial affairs,transactions, and operations of the federation5 disbursements or dispositions of overnment funds or propertyshall invariably bear the approval of the proper officials.
ection L Records of the $E2ERA/%3N
As a corporate body and in accordance 0ith appropriate la0s, it shall eep and carefully preserve records ofall business transactions, minutes of meetins of stocholdersOmembers of the board of directors reflectin alldetails about such activity.
All such records and minutes shall be open to directors, trustees, stocholders, and other members forinspection and copies of 0hich may be re6uested.
As a body corporate, it shall submit the follo0in< annual report5 proceedins of council meetins5 report ofoperations toether 0ith financial statement of its assets and liabilities and fund balance per year5 statementof revenues and e>penses per year5 statement of cash flo0s per year as certified by the accountant5 andother documentsOreports as may be necessary or re6uired by the N2.
ection + L ubmission of Annual and Periodic Report
As mandated under appropriate la0s, the follo0in reports shall be submitted to the N2, to 0it<
a. Annual Report to be submitted not later than every !anuary () of the follo0in year. aid reportshall consist of the follo0in<
). $inancial Report of the $ederation, sined by the /reasurer 9eneral and Auditor 9eneral5
'. Roster of Members of the upreme Council5
(. Roster of Members of the E>ecutive Board and National 3fficers5 and
. Current listin of officers and manaement of H$P.
b. Report on the proceedins of each upreme Council Meetin to be submitted not later than onemonth after the meetin5
c. Report of the H$P President as may be re6uired by N2 or as may be found necessary by thePresident of the $ederation5
d. Resolutions passed by the E>ecutive Board and the upreme Council for confirmation to besubmitted not later than one month after the approval of the resolution5
e. After 3perationOActivity Reports to be submitted not later than one month after such operation oractivity5
ection 4 L Penal anctions
As an attached aency to a reular department of the overnment, the H$P and all its instrumentalities,officials and personnel shall be sub1ect to the penal provisions of such la0s, rules and reulations applicableto the attached aencies of the overnment.
%n a letter dated 4 Auust '77' addressed to the President of petitioner, respondent 2N2 ecretary reiteratedhis instructions in his earlier letter of )( April '77'.
/hereafter, petitionerIs President received a letter dated '( Auust '77' from respondent Gndersecretary,informin him that 2epartment 3rder No. )'* dated '( Auust '77' directed the conduct of a Manaement
Audit of the Heterans $ederation of the Philippines. /he letter 0ent on to state that respondent 2N2ecretary believes that the mandate iven by said la0 can be meaninfully e>ercised if this department canbetter appreciate the functions, responsibilities and situation on the round and this can be done by
undertain a thorouh study of the orani&ation.+
Respondent Gndersecretary also re6uested both for a briefin and for documents on personnel, onoinpro1ects and petitionerIs financial condition. /he letter ended by statin that, after the briefin, the support staffof the Audit Committee 0ould bein their 0or to meet the one-month taret 0ithin 0hich to submit a report.
A letter dated ' Auust '77( informed petitionerIs President that the Manaement Audit 9roup headed bythe Gndersecretary 0ould be payin petitioner a visit on (7 Auust '77' for an update on H$PIs differentaffiliates and the financial statement of the $ederation.
ubse6uently, the ecretary 9eneral of the H$P sent an undated letter to respondent 2N2 ecretary, 0ithnotice to respondent Gndersecretary for Civil Relations and Administration, complainin about the alleedbroadness of the scope of the manaement audit and re6uestin the suspension thereof until such time thatspecific areas of the audit shall have been areed upon.
/he re6uest 0as, ho0ever, denied by the Gndersecretary in a letter dated eptember '77' on the roundthat a specific timeframe had been set for the activity.
Petitioner thus filed this Petition for Certiorari 0ith Prohibition under Rule 4+ of the )**8 Rules of CivilProcedure, prayin for the follo0in reliefs<
). $or this Court to issue a temporary restrainin order and a 0rit of preliminary prohibitory andmandatory in1unction to en1oin respondent ecretary and all those actin under his discretion and
authority from< :a; implementin 2N2 2epartment Circular No. 75 and :b; continuin 0ith the onoinmanaement audit of petitionerIs boos of account5
'. After hearin the issues on notice L
a. 2eclare 2N2 2epartment Circular No. 7 as null and void for bein ultra vires5
b. Convert the 0rit of prohibition, preliminary prohibitory and mandatory in1unction into apermanent one.4
Petitioner asserts that, althouh cases 0hich 6uestion the constitutionality or validity of administrativeissuances are ordinarily filed 0ith the lo0er courts, the urency and substantive importance of the 6uestion onhand and the public interest attendant to the sub1ect matter of the petition 1ustify its bein filed 0ith this Courtdirectly as an oriinal action.8
%t is settled that the Reional /rial Court and the Court of Appeals also e>ercise oriinal 1urisdiction overpetitions for certiorari and prohibition. As 0e have held in numerous occasions, ho0ever, such concurrence oforiinal 1urisdiction does not mean that the party seein e>traordinary 0rits has the absolute freedom to file
his petition in the court of his choice.
/hus, in Commissioner of %nternal Revenue v. =eal,*
0e held that<
uch concurrence of oriinal 1urisdiction amon the Reional /rial Court, the Court of Appeals and this Court,ho0ever, does not mean that the party seein any of the e>traordinary 0rits has the absolute freedom to filehis petition in the court of his choice. /he hierarchy of courts in our 1udicial system determines the appropriateforum for these petitions. /hus, petitions for the issuance of the said 0rits aainst the first level :inferior;courts must be filed 0ith the Reional /rial Court and those aainst the latter, 0ith the Court of Appeals. Adirect invocation of this CourtIs oriinal 1urisdiction to issue these 0rits should be allo0ed only 0here there arespecial and important reasons therefor, specifically and sufficiently set forth in the petition. /his is theestablished policy to prevent inordinate demands upon the CourtIs time and attention, 0hich are betterdevoted to matters 0ithin its e>clusive 1urisdiction, and to prevent further over-cro0din of the CourtIs docet./hus, it 0as proper for petitioner to institute the special civil action for certiorari 0ith the Court of Appeals
assailin the R/C order denyin his motion to dismiss based on lac of 1urisdiction.
/he petition itself, in this case, does not specifically and sufficiently set forth the special and important reasons0hy the Court should ive due course to this petition in the first instance, hereby failin to fulfill the conditionsset forth in Commissioner of %nternal Revenue v. =eal. )7 #hile 0e reiterate the policies set forth in =eal andallied cases and continue to abhor the propensity of a number of litiants to disreard the principle ofhierarchy of courts in our 1udicial system, 0e, ho0ever, resolve to tae 1udicial notice of the fact that thepersons 0ho stand to lose in a possible protracted litiation in this case are 0ar veterans, many of 0homhave precious little time left to en1oy the benefits that can be conferred by petitioner corporation. /hisbicerin for the po0er over petitioner corporation, an entity created to represent and defend the interests of$ilipino veterans, should be resolved as soon as possible in order for it to once and for all direct its resourcesto its rihtful beneficiaries all over the country. All these said, 0e hereby resolve to ive due course to this
petition.
%GE
Petitioner mainly allees that the rules and uidelines laid do0n in the assailed 2epartment Circular No. 7e>panded the scope of control and supervision beyond 0hat has been laid do0n in Rep. Act No.'47.))Petitioner further submits the follo0in issues to this Court<
). #as the challened department circular passed in the valid e>ercise of the respondent ecretaryIscontrol and supervision
'. Could the challened department circular validly lay standards classifyin the H$P, an essentially
civilian orani&ation, 0ithin the ambit of statutes only applyin to overnment entities
(. 2oes the department circular, 0hich rants respondent direct manaement control on the H$P,unduly encroach on the preroatives of H$PIs overnin body
At the heart of all these issues and all of petitionerIs prayers and assertions in this case is petitionerIs claimthat it is a private non-overnment corporation.
Petitioner claims that it is not a public nor a overnmental entity but a private orani&ation, and advances thisclaim to prove that the issuance of 2N2 2epartment Circular No. 7 is an invalid e>ercise of respondentecretaryIs control and supervision.)'
/his Court has defined the po0er of control as the po0er of an officer to alter or modify or nullify or set aside0hat a subordinate has done in the performance of his duties and to substitute the 1udment of the former tothat of the latter.)( /he po0er of supervision, on the other hand, means overseein, or the po0er or authorityof an officer to see that subordinate officers perform their duties. %f the latter fail or nelect to fulfill them, the
former may tae such action or step as prescribed by la0 to mae them perform their duties.)
/hesedefinitions are synonymous 0ith the definitions in the assailed 2epartment Circular No. 7, 0hile the otherprovisions of the assailed department circular are mere conse6uences of control and supervision as defined.
/hus, in order for petitionerIs premise to be able to support its conclusion, petitioners should be deemed toimply either of the follo0in< :); that it is unconstitutionalOimpermissible for the la0 :Rep. Act No. '47; torant control andOor supervision to the ecretary of National 2efense over a private orani&ation, or :'; thatthe control andOor supervision that can be ranted to the ecretary of National 2efense over a privateorani&ation is limited, and is not as stron as they are defined above.
/he follo0in provision of the )*(+ Constitution, the oranic act controllin at the time of the creation of theH$P in )*47, is relevant<
ection 8. /he Conress shall not, e>cept by eneral la0, provide for the formation, orani&ation, or reulationof private corporations, unless such corporations are o0ned and controlled by the 9overnment or anysubdivision or instrumentality thereof.)+
3n the other hand, its counterparts in the )*8( and )*8 constitutions are the follo0in<
ection . /he National Assembly shall not, e>cept by eneral la0, provide for the formation, orani&ation, orreulation of private corporations, unless such corporations are o0ned or controlled by the overnment or anysubdivision or instrumentality thereof.)4
ec. )4. /he Conress shall not, e>cept by eneral la0, provide for the formation, orani&ation, or reulation
of private corporations. 9overnment-o0ned and controlled corporations may be created or established byspecial charters in the interest of the common ood and sub1ect to the test of economic viability.)8
$rom the foreoin, it is crystal clear that our constitutions e>plicitly prohibit the reulation by special la0s ofprivate corporations, 0ith the e>ception of overnment-o0ned or controlled corporations :93CCs;. ?ence, it0ould be impermissible for the la0 to rant control of the H$P to a public official if it 0ere neither a publiccorporation, an unincorporated overnmental entity, nor a 93CC.) aid constitutional provisions can even beread to prohibit the creation itself of the H$P if it 0ere neither of the three mentioned above, but 0e cannot ointo that in this case since there is no challene to the creation of the H$P in the petition as to permit thisCourt from considerin its nullity.
Petitioner viorously arues that the H$P is a private non-overnment orani&ation, pressin on the follo0incontentions<
). /he H$P does not possess the elements 0hich 0ould 6ualify it as a public office, particularly thepossessionOdeleation of a portion of soverein po0er of overnment to be e>ercised for the benefit of the public5
'. H$P funds are not public funds because L
a; No budetary appropriations or overnment funds have been released to the H$P directly or indirectly from the 2epartment of Budet and Manaement :2BM;5
c; /he lease rentals raised from the use of overnment lands reserved for the H$P are privatein character and do not belon to the overnment. aid rentals are fruits of H$PIs labor andefforts in manain and administerin the lands for H$P purposes and ob1ectives. A closeanaloy 0ould be any $ilipino citi&en settlin on overnment land and 0ho tills the land for hislivelihood and sustenance. /he fruits of his labor belon to him and not to the o0ner of theland. uch fruits are not public funds.
(. Althouh the 1uridical personality of the H$P emanates from a statutory charter, the H$P retains itsessential character as a private, civilian federation of veterans voluntarily formed by the veteransthemselves to attain a unity of effort, purpose and ob1ectives, e.. L
a. /he members of the H$P are individual members and retirees from the public and militaryservice5
b. Membership in the H$P is voluntary, not compulsory5
c. /he H$P is overned, not by the Civil ervice =a0, the Articles of #ar nor the 9% =a0, butby the =abor Code and the =a05
d. /he H$P has its o0n Constitution and By-=a0s and is overned by a upreme Council 0hoare elected from and by the members themselves5
. /he Administrative Code of )*8 does not provide that the H$P is an attached aency, nor does itprovide that it is an entity under the control and supervision of the 2N2 in the conte>t of the provisionsof said code.
+. /he 2BM declared that the H$P is a non-overnment orani&ation and issued a certificate that theH$P has not been a direct recipient of any funds released by the 2BM.
/hese aruments of petitioner not0ithstandin, 0e are constrained to rule that petitioner is in fact a publiccorporation. Before respondin to petitionerIs alleations one by one, here are the more evident reasons 0hythe H$P is a public corporation<
:); Rep. Act No. '47 is entitled An Act to Create a Public Corporation to be no0n as the Heterans$ederation of the Philippines, 2efinin its Po0ers, and for 3ther Purposes.
:'; Any action or decision of the $ederation or of the upreme Council shall be sub1ect to the approvalof the ecretary of 2efense.)*
:(; /he H$P is re6uired to submit annual reports of its proceedins for the past year, includin a full,complete and itemi&ed report of receipts and e>penditures of 0hatever ind, to the President of the
Philippines or to the ecretary of National 2efense.'7
:; Gnder E>ecutive 3rder No. (8 dated ' 2ecember )**', the H$P 0as listed as amon theovernment-o0ned and controlled corporations that 0ill not be privati&ed.
:+; %n An Baon Bayani L 3$# =abor Party v. C3ME=EC,') this Court held in a minute resolutionthat the H$P Heterans $ederation PartyD is an ad1unct of the overnment, as it is merely anincarnation of the Heterans $ederation of the Philippines.
And no0 to ans0er petitionerIs reasons for insistin that it is a private corporation<
). Petitioner claims that the H$P does not possess the elements 0hich 0ould 6ualify it as a public office,particularly the possessionOdeleation of a portion of soverein po0er of overnment to be e>ercised for thebenefit of the public5
%n =aurel v. 2esierto,'' 0e adopted the definition of Mechem of a public office, that it is the riht, authority andduty, created and conferred by la0, by 0hich, for a iven period, either fi>ed by la0 or endurin at thepleasure of the creatin po0er, an individual is invested 0ith some portion of the soverein functions of theovernment, to be e>ercised by him for the benefit of the public.
%n the same case, 0e 0ent on to adopt MechemIs vie0 that the deleation to the individual of some of thesoverein functions of overnment is tDhe most important characteristic in determinin 0hether a position isa public office or not.'( uch portion of the sovereinty of the country, either leislative, e>ecutive or 1udicial,must attach to the office for the time bein, to be e>ercised for the public benefit. Gnless the po0ers conferredare of this nature, the individual is not a public officer. /he most important characteristic 0hich distinuishesan office from an employment or contract is that the creation and conferrin of an office involves a deleationto the individual of some of the soverein functions of overnment, to be e>ercised by him for the benefit ofthe public5 L that some portion of the sovereinty of the country, either leislative, e>ecutive or 1udicial,attaches, for the time bein, to be e>ercised for the public benefit. Gnless the po0ers conferred are of thisnature, the individual is not a public officer .' /he issue, therefore, is 0hether the H$AIs officers have beendeleated some portion of the sovereinty of the country, to be e>ercised for the public benefit.
%n several cases, 0e have dealt 0ith the issue of 0hether certain specific activities can be classified assoverein functions. /hese cases, 0hich deal 0ith activities not immediately apparent to be sovereinfunctions, upheld the public soverein nature of operations needed either to promote social 1ustice '+ or tostimulate patriotic sentiments and love of country.'4
As reards the promotion of social 1ustice as a soverein function, 0e held in Aricultural Credit andCooperative $inancin Administration :ACC$A; v. Confederation of Gnions in 9overnment Corporations and3ffices :CG9C3;,'8 that the compellin urency 0ith 0hich the Constitution speas of social 1ustice does notleave any doubt that land reform is not an optional but a compulsory function of sovereinty. /he same reason0as used in our declaration that sociali&ed housin is lie0ise a soverein function. ' ?ihly sinificant here isthe observation of former Chief !ustice @uerube Maalintal<
/he ro0in comple>ities of modern society, ho0ever, have rendered this traditional classification of thefunctions of overnment into constituent and ministrant functionsD 6uite unrealistic, not to say obsolete. /heareas 0hich used to be left to private enterprise and initiative and 0hich the overnment 0as called upon toenter optionally, and only because it 0as better e6uipped to administer for the public 0elfare than is anyprivate individual or roup of individuals, continue to lose their 0ell-defined boundaries and to be absorbed0ithin activities that the overnment must undertae in its soverein capacity if it is to meet the increasinsocial challenes of the times. ?ere,D as almost every0here else,D the tendency is undoubtedly to0ards areater sociali&ation of economic forces. ?ere, of course, this development 0as envisioned, indeed adoptedas a national policy, by the Constitution itself in its declaration of principle concernin the promotion of social
1ustice.'* :Emphasis supplied.;
%t 0as, on the other hand, the fact that the National Centennial Celebrations 0as calculated to arouse andstimulate patriotic sentiments and love of country that it 0as considered as a soverein function in =aurel v.2esierto.(7 %n =aurel, the Court then too its cue from a similar case in the Gnited tates involvin a $ourth of!uly fire0ors display. /he holdin of the Centennial Celebrations 0as held to be an e>ecutive function, as it0as intended to enforce Article Q%H of the Constitution 0hich provides for the conservation, promotion andpopulari&ation of the nationIs historical and cultural heritae and resources, and artistic relations.
%n the case at bar, the functions of petitioner corporation enshrined in ection of Rep. Act No. '47 () shouldmost certainly fall 0ithin the cateory of soverein functions. /he protection of the interests of 0ar veterans isnot only meant to promote social 1ustice, but is also intended to re0ard patriotism. All of the functions inection concern the 0ell-bein of 0ar veterans, our countrymen 0ho rised their lives and lost their limbs in
fihtin for and defendin our nation. %t 0ould be in1ustice of catastrophic proportions to say that it is beyondsovereintyIs po0er to re0ard the people 0ho defended her.
=ie the holdin of the National Centennial Celebrations, the functions of the H$P are e>ecutive functions,desined to implement not 1ust the provisions of Rep. Act No. '47, but also, and more importantly, theConstitutional mandate for the tate to provide immediate and ade6uate care, benefits and other forms ofassistance to 0ar veterans and veterans of military campains, their survivin spouses and orphans.('
'. Petitioner claims that H$P funds are not public funds.
Petitioner claims that its funds are not public funds because no budetary appropriations or overnment fundshave been released to the H$P directly or indirectly from the 2BM, and because H$P funds come frommembership dues and lease rentals earned from administerin overnment lands reserved for the H$P.
/he fact that no budetary appropriations have been released to the H$P does not prove that it is a privatecorporation. /he 2BM indeed did not see it fit to propose budetary appropriations to the H$P, havin itselfbelieved that the H$P is a private corporation.(( %f the 2BM, ho0ever, is mistaen as to its conclusionreardin the nature of H$PIs incorporation, its previous assertions 0ill not prevent future budetaryappropriations to the H$P. /he erroneous application of the la0 by public officers does not bar a subse6uentcorrect application of the la0.(
Nevertheless, funds in the hands of the H$P from 0hatever source are public funds, and can be used only forpublic purposes. /his is mandated by the follo0in provisions of Rep. Act No. '47<
:); ection ' provides that the H$P can only invest its funds for the e>clusive benefit of the Heteransof the Philippines5
:'; ection ' lie0ise provides that :a;ny action or decision of the $ederation or of the upremeCouncil shall be sub1ect to the approval of the ecretary of National 2efense. ?ence, all activities ofthe H$P to 0hich the upreme Council can apply its funds are sub1ect to the approval of the ecretaryof National 2efense5
:(; ection provides that the $ederation shall e>ist solely for the purposes of a benevolentcharacter, and not for the pecuniary benefit of its members5&avvphil.net
:; ection 4 provides that all funds of the H$P in e>cess of operatin e>penses are reserved fordisbursement, as the upreme Council may authori&e, for the purposes stated in ection t0o of this
Act5
:+; ection )7 provides that :a;ny donation or contribution 0hich from time to time may be made tothe $ederation by the 9overnment of the Philippines or any of its subdivisions, branches, offices,aencies or instrumentalities shall be e>pended by the upreme Council only for the purposesmentioned in this Act.5 and finally,
:4; ection )' re6uires the submission of annual reports of H$P proceedins for the past year,includin a full, complete and itemi&ed report of receipts and e>penditures of 0hatever ind, to thePresident of the Philippines or to the ecretary of National 2efense.
%t is important to note here that the membership dues collected from the individual members of H$PIs affiliateorani&ations do not become public funds 0hile they are still funds of the affiliate orani&ations. A closereadin of ection )(+ of Rep. Act No. '47 reveals that 0hat has been created as a body corporate is not theindividual membership of the affiliate orani&ations, but merely the areation of the heads of the affiliateorani&ations. /hus, only the money remitted by the affiliate orani&ations to the H$P partae in the publicnature of the H$P funds.
%n Republic v. C3C3$E2,(4 0e held that the Coconut =evy $unds are public funds because, inter alia, :); they0ere meant to be for the benefit of the coconut industry, one of the ma1or industries supportin the nationaleconomy, and its farmers5 and :'; the very la0s overnin coconut levies reconi&e their public character. /hesame is true 0ith reard to the H$P funds. No less public is the use for the H$P funds, as such use is limitedto the purposes of the H$P 0hich 0e have ruled to be soverein functions. =ie0ise, the la0 overnin H$Pfunds :Rep. Act No. '47; reconi&es the public character of the funds as sho0n in the enumeratedprovisions above.
#e also observed in the same C3C3$E2 case that :e;ven if the money is allocated for a special purposeand raised by special means, it is still public in character.(8 %n the case at bar, some of the funds 0ere raisedby even more special means, as the contributions from affiliate orani&ations of the H$P can hardly berearded as enforced contributions as to be considered ta>es. /hey are more in the nature of donations 0hichhave al0ays been reconi&ed as a source of public fundin. Affiliate orani&ations of the H$P cannotcomplain of their contributions becomin public funds upon the receipt by the H$P, since they are presumeda0are of the provisions of Rep. Act No. '47 0hich not only specifies the e>clusive purposes for 0hich H$Pfunds can be used, but also provides for the reulation of such funds by the national overnment throuh theecretary of National 2efense. /here is nothin 0ron, 0hether leally or morally, from raisin revenuesthrouh non-traditional methods. As remared by !ustice $lorentino $eliciano in his concurrin opinion inilosbayan, %ncorporated v. 9uinona, !r .( 0here he e>plained that the funds raised by the 3n-line =otteryystem 0ere also public in nature, thus<
> > > /Dhe more successful the overnment is in raisin revenues by non-traditional methods such asPA9C3R operations and privati&ation measures, the lesser 0ill be the pressure upon the traditional sourcesof public revenues, i.e., the pocet boos of individual ta>payers and importers.
Petitioner additionally harps on the inapplicability of the case of =aurel v. 2esierto(* 0hich 0as cited byRespondents. Petitioner claims that amon the reasons National Centennial Commission Chair alvador=aurel 0as considered a public officer 0as the fact that his compensation 0as derived from public funds.?avin ruled that H$P funds from 0hatever source are public funds, 0e can safely conclude that the upremeCouncilIs compensation, taen as they are from H$P funds under the term operatin e>penses in ection 4of Rep. Act No. '47, are derived from public funds. /he particular nomenclature of the compensation taenfrom H$P funds is not even of relevance here. As 0e said in =aurel concernin compensation as an element
of public office<
Gnder particular circumstances, compensation has been held to include allo0ance for personal e>penses,commissions, e>penses, fees, an honorarium, mileae or travelin e>penses, payments for services,restitution or a balancin of accounts, salary, and 0aes.7
(. Petitioner arues that it is a civilian federation 0here membership is voluntary.
Petitioner claims that the ecretary of National 2efense historically did not indule in the direct ormicromanaementI of the H$P precisely because it is essentially a civilian orani&ation 0here membership isvoluntary.) /his reliance of petitioner on 0hat has historically been done is erroneous, since la0s are notrepealed by disuse, custom, or practice to the contrary.' $urthermore, as earlier stated, the erroneous
application of the la0 by public officers does not bar a subse6uent correct application of the la0.(
Neither is the civilian nature of H$P relevant in this case. /he Constitution does not contain any prohibition,e>press or implied, aainst the rant of control andOor supervision to the ecretary of National 2efense over acivilian orani&ation. /he 3ffice of the ecretary of National 2efense is itself a civilian office, its occupantbein an alter eo of the civilian Commander-in-Chief. /his set-up is the manifestation of the constitutionalprinciple that civilian authority is, at all times, supreme over the military. /here bein no such constitutionalprohibition, the creation of a civilian public orani&ation by Rep. Act No. '47 is not rendered invalid by itsbein placed under the control and supervision of the ecretary of National 2efense.
PetitionerIs stand that the H$P is a private corporation because membership thereto is voluntary is lie0iseerroneous. As stated above, the membership of the H$P is not the individual membership of the affiliateorani&ations, but merely the areation of the heads of such affiliate orani&ations. /hese heads forminthe H$P then elect the upreme Council and the other officers, + of this public corporation.
. Petitioner claims that the Administrative Code of )*8 does not provide that the H$P is an attached aency,and nor does it provide that it is an entity under the control and supervision of the 2N2 in the conte>t of theprovisions of said code.
/he Administrative Code, by ivin definitions of the various entities covered by it, acno0ledes that itsenumeration is not e>clusive. /he Administrative Code could not be said to have repealed nor enormouslymodified Rep. Act No. '47 by implication, as such repeal or enormous modification by implication is notfavored in statutory construction.4
+. Petitioner offers as evidence the 2BM opinion that the H$P is a non-overnment orani&ation in itscertification that the H$P has not been a direct recipient of any funds released by the 2BM.
Respondents claim that the supposed declaration of the 2BM that petitioner is a non-overnment orani&ationis not persuasive, since 2BM is not a 6uasi-1udicial aency. /hey aver that 0hat 0e have said of the Bureauof =ocal 9overnment $inance :B=9$; in Philippine =on 2istance /elephone Company :P=2/; v. City of
2avao8 can be applied to 2BM<
%n any case, it is contended, the rulin of the Bureau of =ocal 9overnment $inance :B=9$; that petitionerIse>emption from local ta>es has been restored is a contemporaneous construction of ection '( of R.A. No.8*'+ and, as such, is entitled to reat 0eiht.
/he rulin of the B=9$ has been considered in this case. But unlie the Court of /a> Appeals, 0hich is aspecial court created for the purpose of revie0in ta> cases, the B=9$ 0as created merely to provideconsultative services and technical assistance to local overnments and the eneral public on local ta>ationand other related matters. /hus, the rule that the Court 0ill not set aside conclusions rendered by the C/A,0hich is, by the very nature of its function, dedicated e>clusively to the study and consideration of ta>problems and has necessarily developed an e>pertise on the sub1ect, unless there has been an abuse or
improvident e>ercise of authority cannot apply in the case of the B=9$.
3n this score, thouh, 0e disaree 0ith respondents and hold that the 2BMIs appraisal is consideredpersuasive. Respondents misread the P=2/ case in assertin that only 6uasi-1udicial aenciesI determinationcan be considered persuasive. #hat the P=2/ case points out is that, for an administrative aencyIs opinionto be persuasive, the administrative aency involved :0hether it has 6uasi-1udicial po0ers or not; must be ane>pert in the field they are ivin their opinion on.
/he 2BM is indeed an e>pert on determinin 0hat the various overnment aencies and corporations are./his determination is necessary for the 2BM to fulfill its mandate<
ec. '. Mandate. - /he 2epartment shall be responsible for the formulation and implementation of theNational Budet 0ith the oal of attainin our national socio-economic plans and ob1ectives.
/he 2epartment shall be responsible for the efficient and sound utili&ation of overnment funds and revenuesto effectively achieve our country"s development ob1ectives.
/he persuasiveness of the 2BM opinion has, ho0ever, been overcome by all the previous e>planations 0ehave laid so far. %t has also been eclipsed by another similarly persuasive opinion, that of the 2epartment ofNational 2efense embodied in 2epartment Circular No. 7. /he 2N2 is clearly more of an e>pert 0ith respectto the determination of the entities under it, and its Administrative Rules and Reulations are entitled to reatrespect and have in their favor the presumption of leality.*
/he 2BM opinion furthermore suffers from its lac of e>planation and 1ustification in the certification of non-receipt 0here said opinion 0as iven. /he 2BM has not furnished, in said certification or else0here, ane>planation for its opinion that H$P is a non-overnment orani&ation.
/?E $A/E 3$ 2EPAR/MEN/ C%RCG=AR N3. 7
3ur rulin that petitioner is a public corporation is determinative of 0hether or not 0e should rant petitionerIsprayer to declare 2epartment Circular No. 7 void.
Petitioner assails 2epartment Circular No. 7 on the round that it e>panded the scope of control andsupervision beyond 0hat has been laid do0n in Rep. Act No. '47. Petitioner allees that :t;he e6uation ofthe meanin of ScontrolI and SsupervisionI of the Administrative Code of )*8 as the same Scontrol andsupervisionI under Rep. Act No. '47, taes out the conte>t of the oriinal leislative intent from the peculiarsurroundin circumstances and conditions that brouht about the creation of the H$P. +7 Petitioner claims thatthe H$P 0as intended as a self-overnin autonomous body 0ith a upreme Council as overnin authority,and that the assailed circular pre-empts H$PIs oriinal self-overnance and autonomy :in; representinveterans orani&ations, and substitutes overnment discretion and decisions to that of the veteransI o0ndetermination.+) Petitioner says that the circularIs provisions practically render the upreme Council inutile,despite its bein the statutory overnin body of the H$P.+'
As previously mentioned, this Court has defined the po0er of control as the po0er of an officer to alter ormodify or nullify or set aside 0hat a subordinate has done in the performance of his duties and to substitutethe 1udment of the former to that of the latter.+( /he po0er of supervision, on the other hand, meansoverseein, or the po0er or authority of an officer to see that subordinate officers perform theirduties.+ Gnder the Administrative Code of )*8<++
upervision and control shall include the authority to act directly 0henever a specific function is entrusted byla0 or reulation to a subordinate5 direct the performance of duty5 restrain the commission of acts5 revie0,approve, reverse or modify acts and decisions of subordinate officials or units5 determine priorities in thee>ecution of plans and prorams5 and prescribe standards, uidelines, plans and prorams. > > >
/he definition of the po0er of control and supervision under ection ' of the assailed 2epartment Circular are
synonymous 0ith the foreoin definitions. Conse6uently, and considerin that petitioner is a publiccorporation, the provisions of the assailed 2epartment Circular No. 7 did not supplant nor modify theprovisions of Republic Act No. '47, thus not violatin the settled rule that all such :administrative; issuancesmust not override, but must remain consistent and in harmony 0ith the la0 they see to apply or implement.
Administrative rules and reulations are intended to carry out, neither to supplant nor to modify, the la0.+4
ection (.' of the assailed department circular, 0hich authori&es the ecretary of National 2efense to > > >personally or throuh a desinated representative, re6uire the submission of reports, documents and otherpapers reardin any or all of the $ederationIs business functions, > > >.
as 0ell as ection (.( 0hich allo0s the ecretary of 2N2 to
> > > $Drom time to time issue uidelines, directives and other orders overnin vital overnment activitiesincludin, but not limited to, the conduct of elections, the ac6uisition, manaement and dispositions ofproperties, the accountin of funds, financial interests, stocs and bonds, corporate investments, etc. andsuch other transactions 0hich may affect the interests of the veterans.
are merely conse6uences of both the po0er of control and supervision ranted by Rep. Act No. '47. /hepo0er to alter or modify or nullify or set aside 0hat a subordinate has done in the performance of his duties,or to see to it that subordinate officers perform their duties in accordance 0ith la0, necessarily re6uires theability of the superior officer to monitor, as closely as it desires, the acts of the subordinate.
/he same is true 0ith respect to ections and + of the assailed 2epartment Circular No. 7, 0hich re6uiresthe preservation of the records of the $ederation and the submission to the ecretary of National 2efense ofannual and periodic reports.
Petitioner lie0ise claims that the assailed 2N2 2epartment Circular No. 7 0as never published, and hencevoid.+8 Respondents deny such non-publication.+
#e have put forth both the rule and the e>ception on the publication of administrative rules and reulations in
the case of /aFada v. /uvera<+*
> > > Administrative rules and reulations must also be published if their purpose is to enforce or implemente>istin la0 pursuant also to a valid deleation.
%nterpretative reulations and those merely internal in nature, that is, reulatin only the personnel of theadministrative aency and not the public, need not be published. Neither is publication re6uired of the so-called letters of instructions issued by administrative superiors concernin the rules on uidelines to befollo0ed by their subordinates in the performance of their duties.
Even assumin that the assailed circular 0as not published, its validity is not affected by such non-publicationfor the reason that its provisions fall under t0o of the e>ceptions enumerated in /aFada.
2epartment Circular No. 7 is an internal reulation. As 0e have ruled, they are meant to reulate a publiccorporation under the control of 2N2, and not the public in eneral. As lie0ise discussed above, 0hat hasbeen created as a body corporate by Rep. Act No. '47 is not the individual membership of the affiliateorani&ations of the H$P, but merely the areation of the heads of the affiliate orani&ations. Conse6uently,the individual members of the affiliate orani&ations, 0ho are not public officers, are beyond the reulation ofthe circular.
ections ', ( and 4 of the assailed circular are additionally merely interpretative in nature. /hey add nothin tothe la0. /hey do not affect the substantial rihts of any person, 0hether party to the case at bar or not. %nections ' and (, control and supervision are defined, mentionin actions that can be performed asconse6uences of such control and supervision, but 0ithout specifyin the particular actions that shall be
rendered to control and supervise the H$P. ection 4, in the same vein, merely state 0hat the drafters of thecircular perceived to be conse6uences of bein an attached aency to a reular department of theovernment, enumeratin sanctions and remedies provided by la0 that may be availed of 0henever desired.
Petitioner then ob1ects to the implementation of ec. (. of the assailed 2epartment Circular, 0hich providesthat L
(. $inancial transactions of the $ederation shall follo0 the provisions of the overnment auditin code :P2)+; i.e. overnment funds shall be spent or used for public purposes5 trust funds shall be available and maybe spent only for the specific purpose for 0hich the trust 0as created or the funds received5 fiscalresponsibility shall, to the reatest e>tent, be shared by all those e>ercisin authority over the financial affairs,transactions, and operations of the federation5 disbursements or dispositions of overnment funds or propertyshall invariably bear the approval of the proper officials.
ince 0e have also previously determined that H$P funds are public funds, there is lie0ise no reason todeclare this provision invalid. ection (. is correct in re6uirin the H$P funds to be used for public purposes,but only insofar the term public purposes is construed to mean public purposes enumerated in Rep. Act No.'47.
?avin in their possession public funds, the officers of the H$P, especially its fiscal officers, must indeed sharein the fiscal responsibility to the reatest e>tent.
As to petitionerIs alleation that H$P 0as intended as a self-overnin autonomous body 0ith a upremeCouncil as overnin authority, 0e find that the provisions of Rep. Act No. '47 concernin the control andsupervision of the ecretary of National 2efense clearly 0ithholds from the H$P complete autonomy. /o say,ho0ever, that such provisions render the H$P inutile is an e>aeration. An office is not rendered inutile bythe fact that it is placed under the control of a hiher office. /hese subordinate offices, such as the e>ecutiveoffices under the control of the President, e>ercise discretion at the first instance. #hile their acts can bealtered or even set aside by the superior, these acts are effective and are deemed the acts of the superioruntil they are modified. urely, 0e cannot say that the offices of all the 2epartment ecretaries are 0orthless
positions.
%n sum, the assailed 2N2 2epartment Circular No. 7 does not supplant nor modify and is, on the contrary,perfectly in consonance 0ith Rep. Act No. '47. Petitioner H$P is a public corporation. As such, it can beplaced under the control and supervision of the ecretary of National 2efense, 0ho conse6uently has thepo0er to conduct an e>tensive manaement audit of petitioner corporation.
#?ERE$3RE, the Petition is hereby 2%M%E2 for lac of merit. /he validity of the 2epartment of National2efense 2epartment Circular No. 7 is A$$%RME2.
3 3R2ERE2.
MINIT! . C"ICO-N!!RIO Associate !ustice
#E C3NCGR<
!RTEMIO . P!NG!NI!NChief !ustice
RE#N!TO S. PUNO Associate !ustice
LEON!R%O !. UISUMING Asscociate !ustice
CONSUELO #N!RES-S!NTI!GO Associate !ustice
!NGELIN! S!N%O!L-GUTIERRE Asscociate !ustice
!NTONIO T. C!RPIO Associate !ustice
M!. !LICI! !USTRI!-M!RTINE Asscociate !ustice
REN!TO C. CORON! Associate !ustice
CONC"IT! C!RPIO MOR!LES Asscociate !ustice
ROMEO &. C!LLE&O, SR. Associate !ustice
!%OL$O S. !CUN! Asscociate !ustice
%!NTE O. TING! Associate !ustice
C!NCIO C. G!RCI! Asscociate !ustice
C E R / % $ % C A / % 3 N
Pursuant to Article H%%%, ection )( of the Constitution, it is hereby certified that the conclusions in the above2ecision 0ere reached in consultation before the case 0as assined to the 0riter of the opinion of the Court.
he RC sai& that the petition /as &is*issible because of the failure of respon&ent to ehaust all a&*inistrati%e
re*e&ies, as re6uire& b( ection 2, 2C of the ECEC Gui&elines on the Con&uct of istrict Elections for Electric
Cooperati%e he section re6uire& that a protest arisin) fro* &is6ualification shall be file& /ith the screenin)
co**ittee in not less than +DE <5= &a(s before the election he screenin) co**ittee shall &eci&e the protest /ithin
+7RI"EG; <4= hours fro* receipt thereof +ailure of the applicant to file hisJher protest /ithin the abo%e"cite&
perio& shall be &ee*e& a /ai%er of his ri)ht to protest5F
As obser%e& b( the RC, respon&ent ha& ur)entl( file& the petition on No%e*ber 21, 2... because the election
sou)ht to be restraine& /as )oin) to be hel& on ece*ber 2, 2... an& No%e*ber 2. /as a holi&a( 3n&er the
circu*stances, respon&ent ha& little ti*e to ehaust the re*e&( in ec 2 of the Gui&elines, such that an eception coul&
be *a&e More i*portantl(, accor&in) to the RC, the rule on ehaustion of a&*inistrati%e re*e&ies cannot be in%o-e&
in the instant case since the )ui&elines prescribin) the a&*inistrati%e re*e&( is a sub>ect *atter of the ECEC, /hich is at
issue, an& is eactl( /hat is bein) sou)ht to be in%ali&ate&#F
7n ece*ber 12, 2..., respon&ent file& a *otion to /ith&ra/ the a*en&e& petition, an& to a&*it a secon&a*en&e& petition that i*plea&e& NEA as in&ispensable part(Respon&ent also a%erre& that the ECEC /as null an& %oi&
because it ha& not been publishe& 7n ece*ber 2., 2..., the RC a&*itte& the secon& a*en&e& petition, issue& a /rit
of preli*inar( in>unction to pre%ent the con&uct of election for &irectorship, issue& su**ons to NEA, an& re6uire& NEA
to co**ent if the ECEC /as publishe& in an( ne/spaper of )eneral circulation$F
7n anuar( 29, 2..1, NEA file& a *otion for etension of ti*e to file an ans/er, an& subse6uentl( on April 1.,
2..1, a Motion for !ea%e to A&*it Plea&in) to /hich a Motion to is*iss /as attache& NEA 6uestione& the >uris&iction
of the RC an& alle)e& that respon&ent faile& to ehaust a&*inistrati%e re*e&ies F
n its ul( 20, 2..1 7r&er,9F the RC &enie& petitioners Motion to is*iss for bein) file& out of ti*e More
i*portantl(, it note& NEAs failure to state /hether the ECEC /as in&ee& publishe& in a ne/spaper of )eneral circulation
as re6uire& b( the Ne/ Ci%il Co&e an& the A&*inistrati%e Co&e of 19$ he RC sai& the failure ren&ere& the ECEC
null an& %oi& As re)ar&s the lac- of >uris&iction an& non"ehaustion of a&*inistrati%e re*e&ies, the RC note& that
NEA erroneousl( relie& on ec 59 of Presi&ential ecree No <P= 2#9 an& *isapplie& the cases it cite&
Accor&in) to the RC, ec 59 of P 2#9 refers to or&er, rulin) or &ecision of the NEA in the eercise of NEAs
6uasi">u&icial functions An& the RC note& that ecs 51 to 5 refer to hearin)s, in%esti)ations, an& proce&ures 7n the
other han&, the %ali&it( of the ECEC, sub>ect of the instant petition, /as an eercise of NEAs 6uasi"le)islati%e function
or rule"*a-in) authorit(
+urther, accor&in) to the RC, NEA too- ec 5 of P 2#9 out of contet /hen it sai& ec 5 &ealt /ith the
a&*inistrati%e re*e&( a%ailable to petitioner t sai& that ec 5 presuppose& a rulin) or &ecision of the NEA an& there
/as none in the case before it he RC rule& in fa%or of Gon8a)a, an& or&ere& HAM3REC7 to accept Gon8a)as
certificate of can&i&ac( for &irector 1.F he RC &enie& NEAs *otion for reconsi&erationThe CA Rue! "h#" "he Cou$"% &#'e Ju$(%!()"(o* O'e$
A))rie%e&, petitioner appeale& to the CA he CA &enie& &ue course an& &is*isse& the petition t sai& that NEA
/as not eercisin) its 6uasi">u&icial po/ers but its rule"*a-in) authorit( n the case before the trial court, the CA
stresse& that the issue in%ol%e& the interpretation of the ECEC, an& to this etent, NEA ha& no >uris&iction because the
issue is /ithin the pro%ince of the courts
he CA &enie& petitioners Motion for Reconsi&eration in its une 1., 2..0 Resolution ;ence, /e ha%e this
petition
The I%%ue%
:;E;ER 7R N7 ;E C73R 7+ APPEA! ERRE N N7 APP!ING EC7N 59 7+ P2#9 :;E;ER 7R N7 ;E C73R 7+ APPEA! ERRE N 3P;7!NG ;E RA! C73R N3!!+CA7N 7+ ;E ECEC
I%%ue% I*'o'(*+ NEA% RueM#/(*+ Au"ho$("
A$e Co+*(0#e Re+u#$ Cou$"%
he petition has no *erit
ec 59 of P 2#9 pro%i&es@ EC 59 Court Reviewhe upre*e Court is hereb( )i%en >uris&iction to re%ie/ an( or&er,
rulin) or &ecision of the NEA an& to *o&if( or set asi&e such or&er, rulin) or &ecision /hen it clearl(appears that there is no e%i&ence before the NEA to support reasonabl( such or&er, rulin) or &ecision, or that the sa*e is contrar( to la/, or that it /as /ithout the >uris&iction of the NEA he e%i&ence presente& to the NEA, to)ether /ith the recor& of the procee&in)s before the NEA, shall be certifie& b(the NEA to the upre*e Court An( or&er, rulin) or &ecision of the NEA *a( li-e/ise be re%ie/e& b(the upre*e Court upon /rit of certiorari in proper case he proce&ure for re%ie/, ecept as herein pro%i&e&, shall be presente& b( rules of the upre*e Court An( or&er or &ecision of the NEA *a( bere%ie/e& on the application of an( person or public ser%ice entit( a))rie%e& thereb( an& /ho /as a part( in the sub>ect procee&in), b( certiorari in appropriate cases or b( a petition for re%ie/, /hich shall be file& /ithin thirt( <0.= &a(s fro* the notification of the NEA or&er, &ecision or rulin) onreconsi&eration ai& petition shall be place& on file in the office of the Cler- for the upre*e Court /hoshall furnish copies thereof to the NEA an& other intereste& parties
Petitioner ar)ues that base& on the fore)oin) pro%ision, onl( the upre*e Court has the authorit( to re%ie/ the
acts of NEA as an a&*inistrati%e bo&( /ith a&>u&icati%e an& rule"*a-in) po/er t cite& NEA v. Mendoza, usin) the
Courts pronounce*ent that@
Fhe po/er of >u&icial re%ie/ of NEAs or&er or &ecision pertains to the upre*e Court as &ecree& inection 59 of P 2#9 /hich %ests specificall( on the Supreme Court the >uris&iction to re%ie/ an(or&er, rulin) or &ecision of the NEA an& to *o&if( or set asi&e such or&ers, rulin)s or &ecisions11F
t is ob%ious that ec 59 of P 2#9 refers to or&er, rulin) or &ecision of NEA :hat is bein) challen)e& in this
case is the &ecision of the screenin) co**ittee of HAM3REC7 to &is6ualif( respon&ent !i-e/ise assaile& is the
%ali&it( of the ECEC, particularl(, /hether the re6uire*ent of publication /as co*plie& /ith he ECEC /as issue& b(
NEA pursuant to its rule"*a-in) authorit(, not its 6uasi">u&icial function ;ence, the issue re)ar&in) the contro%ers(
o%er respon&ents &is6ualification an& the 6uestion on the ECECs %ali&it( are /ithin the inherent >uris&iction of re)ular
courts to re%ie/ Petitioners reliance on NEA is *isplace& he sub>ect in that case /as the electricit( rates char)e& b( a
cooperati%e, a *atter /hich is clearl( /ithin NEAs >uris&iction he issue in the present petition, ho/e%er, centers on the
%ali&it( of NEAs rules in li)ht of the publication re6uire*ents of the A&*inistrati%e Co&e an& Ne/ Ci%il Co&e he
present issue is co)ni8able b( re)ular courts
:ith re)ar& to the secon& issue, /e fin& no error in the appellate an& trial courts nullification of the ECEC he
CA correctl( obser%e& that /hile HAM3REC7 co*plie& /ith the re6uire*ents of filin) the co&e /ith the 3ni%ersit(
of the Philippines !a/ Center, it offere& no proof of publication in the Officia !azette nor in a ne/spaper of )eneral
circulation :ithout co*pliance /ith the re6uire*ent of publication, the rules an& re)ulations containe& in the ECEC
cannot be enforce& an& i*ple*ente&
Article 2 of the Ne/ Ci%il Co&e pro%i&es that la/s shall ta-e effect after fifteen <15= &a(s follo/in) the
co*pletion of their publication in the Officia !azette or in a ne/spaper of )eneral circulation in the Philippines, unless
it is other/ise pro%i&e&
Eecuti%e 7r&er No 292, other/ise -no/n as the Admini"trative Code of #$%& , reinforce& the re6uire*ent of
publication an& outline& the proce&ure, as follo/s@ ec 0 +ilin) <1= E%er( A)enc( shall file /ith the 3ni%ersit( of
the Philippines !a/ Center three <0= Certifie& copies of e%er( rule a&opte& b( it Rules in force on the&ate of effecti%it( of this Co&e /hich are not file& /ithin three <0= *onths fro* that &ate shall notthereafter be the basis of an( sanction a)ainst an( part( or persons
<2= he Recor&s 7fficer of the a)enc(, or his e6ui%alent functionar(, shall carr( out the
re6uire*ents of this section un&er pain of &isciplinar( action <0= A per*anent re)ister of all rules shall be -ept b( the issuin) a)enc( an& shall be open to
public inspection ec 4 Effecti%it( n a&&ition to other rule"*a-in) re6uire*ents pro%i&e& b( la/ not
inconsistent /ith this Boo-, each rule shall beco*e effecti%e fifteen <15= &a(s fro* the &ate of filin) asabo%e pro%i&e& unless a &ifferent &ate is fie& b( la/, or specifie& in this rule
ec 1 :hen !a/s a-e Effect !a/s shall ta-e effect after +ifteen <15= &a(s follo/in) the
co*pletion of their publication in the 7fficial Ga8ette or in a ne/spaper of )eneral circulation, unless itis other/ise pro%i&e&
:e ha%e alrea&( e*phasi8e& an& clarifie& the re6uire*ent of publication in this Courts Resolution in 'aada v
:e hol& therefore that all statutes, inclu&in) those of local application an& pri%ate la/s, shall be publishe& as a con&ition for their effecti%it( /hich shall be)in fifteen <15= &a(s after publication unless a&ifferent effecti%it( &ate is fie& b( the le)islature Co%ere& b( this rule are presi&ential &ecrees an& eecuti%e or&ers pro*ul)ate& b( the Presi&ent in theeercise of le)islati%e po/ers /hene%er the sa*e are %ali&l( &ele)ate& b( the le)islature or, at present,&irectl( conferre& b( the Constitution A!2(*(%"$#"('e $ue% #*! $e+u#"(o*% 2u%" #%o e 3u(%he! (-
"he($ 3u$3o%e (% "o e*-o$)e o$ (23e2e*" e4(%"(*+ # 3u$%u#*" #%o "o # '#(! !ee+#"(o*
nterpretati%e re)ulations an& those *erel( internal in nature, that is, re)ulatin) onl( the personnel of thea&*inistrati%e a)enc( an& not the public, nee& not be publishe& Neither is publication re6uire& of theso"calle& letters of instructions issue& b( a&*inistrati%e superiors concernin) the rules or )ui&elines to be follo/e& b( their subor&inates in the perfor*ance of their &uties <E*phasis supplie&= 12F
he afore6uote& rulin) /as reiterate& in (adoe v. Commi""ion on Audit ,10F (e Je"u" v. Commi""ion on Audit
14F an& *hiippine +nternationa 'rading Corporation v. Commi""ion on Audit 15F
n the case at bar, the ECEC /as issue& b( petitioner pursuant to its rule"*a-in) authorit( pro%i&e& in P 2#9,
as a*en&e&, particularl( ec 24@
ection 24 Boar& of irectors <a= he Mana)e*ent of a Cooperati%e shall be %este& in its
Boar&, sub>ect to the super%ision an& control of NEA /hich shall ha%e the ri)ht to be represente& an& to participate in all Boar& *eetin)s an& &eliberations an& to appro%e all policies an& resolutions
he co*position, 6ualifications, the *anner of elections an& fillin) of %acancies, the proce&ures
for hol&in) *eetin)s an& other si*ilar pro%isions shall be &efine& in the B("la/s of the Cooperati%esub>ect to NEA policies, rules an& re)ulations
he ECEC applies to all electric cooperati%es in the countr( t is not a *ere internal *e*oran&u*, interpretati%e
re)ulation, or instruction to subor&inates hus, the ECEC shoul& co*pl( /ith the re6uire*ents of the Ci%il Co&e an&
the A&*inistrati%e Co&e of 19$ n pre%ious cases in%ol%in) the election of &irectors for electric cooperati%es, the
%ali&it( of the ECEC /as not put in issue he ECEC then en>o(e& the presu*ption of %ali&it( n this case, ho/e%er
respon&ent &irectl( 6uestione& the %ali&it( of the ECEC in his secon& a*en&e& petition he trial court thus re6uire&
petitioner to sho/ proof of publication of the ECEC Petitioner coul& ha%e easil( pro%i&e& such proof ha& the ECEC
actuall( been publishe& in the Officia !azette or ne/spaper of )eneral circulation in the countr( his si*ple proof
coul& ha%e i**e&iatel( lai& this case to rest Petitioners failure to &o so onl( i*plies that the ECEC /as not publishe&
accor&in)l(, a fact supporte& b( the certification fro* the National Printin) 7ffice
!astl(, petitioner a%ers that a petition for *an&a*us an& prohibition shoul& not ha%e been resorte& to b(
respon&ent he proper recourse, accor&in) to petitioner, is a petition for &eclarator( relief Petitioner *iserabl( errs on
this point Rule #0 on &eclarator( relief states@
ection 1 :ho *a( file petitionAn( person intereste& un&er a &ee&, /ill, contract or other
/ritten instru*ent, or /hose ri)hts are affecte& b( a statute, eecuti%e or&er or re)ulation, or&inance, or an( other )o%ern*ental re)ulation *a(, before breach or %iolation thereof, brin) an action in theappropriate Re)ional rial Court to &eter*ine an( 6uestion of construction or %ali&it( arisin), an& for a&eclaration of his ri)hts or &uties thereun&er
attest that the conclusions in the abo%e ecision ha& been reache& in consultation before the case /as assi)ne& to the/riter of the opinion of the Courts i%ision
LEONARDO A. 9ISMBING
Associate usticeChairperson
C E R T I F I C A T I O N
Pursuant to ection 10, Article D of the Constitution, an& the i%ision Chairpersons Attestation, certif( that theconclusions in the abo%e ecision ha& been reache& in consultation before the case /as assi)ne& to the /riter of theopinion of the Courts i%ision
Petitioner ecurities and E>chane Commission :EC; assails the 2ecision) dated $ebruary '7, '77 of theCourt of Appeals in CA-9.R. P No. 4)4(, 0hich directed that EC Memorandum Circular No. ), eries of)*4 should be the basis for computin the filin fee relative to 9MA Net0or, %nc.Is :9MAIs; application forthe amendment of its articles of incorporation for purposes of e>tendin its corporate term.
/he undisputed facts as narrated by the appellate court are as follo0s<
3n Auust )*, )**+, the petitioner, 9MA NE/#3R, %NC., :9MA, for brevity;, a domestic corporation,filed an application for collective approval of various amendments to its Articles of %ncorporation andBy-=a0s 0ith the respondent ecurities and E>chane Commission, :EC, for brevity;. /heamendments applied for include, amon others, the chane in the corporate name of petitioner fromRepublic Broadcastin ystem, %nc. to 9MA Net0or, %nc. as 0ell as the e>tension of the corporateterm for another fifty :+7; years from and after !une )4, '777.
Gpon such filin, the petitioner had been assessed by the ECIs Corporate and =eal 2epartment aseparate filin fee for the application for e>tension of corporate term e6uivalent to )O)7 of ) of itsauthori&ed capital stoc plus '7 thereof or an amount of P),')','77.77.
3n eptember '4, )**+, the petitioner informed the EC of its intention to contest the leality andpropriety of the said assessment. ?o0ever, the petitioner re6uested the EC to approve the otheramendments bein re6uested by the petitioner 0ithout bein deemed to have 0ithdra0n its applicationfor e>tension of corporate term.
3n 3ctober '7, )**+, the petitioner formally protested the assessment amountin to P),')','77.77for its application for e>tension of corporate term.
3n $ebruary '7, )**4, the EC approved the other amendments to the petitionerIs Articles of%ncorporation, specifically Article ) thereof referrin to the corporate name of the petitioner as 0ell as
Article ' thereof referrin to the principal purpose for 0hich the petitioner 0as formed.
3n March )*, )**4, the petitioner re6uested for an official opinionOrulin from the EC on the validityand propriety of the assessment for application for e>tension of its corporate term.
Conse6uently, the respondent EC, throuh Associate Commissioner $e Eloisa C. 9loria, on April ),)**4, issued its rulin upholdin the validity of the 6uestioned assessment, the dispositive portion of0hich states<
I/ >5 o 5e ore>o/>, ?e beeve 5* 5e @)eo/e *eme/ / *or*/e ?5 *?.!or/>+, +o) *re 5ereb+ re@)re o om+ ?5 5e re@)re /> ee.
An appeal from the afore6uoted rulin of the respondent EC 0as subse6uently taen by thepetitioner on the round that the assessment of filin fees for the petitionerIs application for e>tensionof corporate term e6uivalent to )O)7 of ) of the authori&ed capital stoc plus '7 thereof is not inaccordance 0ith la0.
3n eptember '4, '77), follo0in three :(; motions for early resolution filed by the petitioner, therespondent EC En Banc issued the assailed order dismissin the petitionerIs appeal, the dispositiveportion of 0hich provides as follo0s<
;"ERE$ORE, or *A o mer, 5e /*/ !e* 5ereb+ me.
SO OR%ERE%.'
%n its petition for revie0( 0ith the Court of Appeals, 9MA arued that its application for the e>tension of itscorporate term is ain to an amendment and not to a filin of ne0 articles of incorporation. %t further averredthat EC Memorandum Circular No. ', eries of )**, 0hich the EC used as basis forassessin P),')','77.77 as filin fee for the e>tension of 9MAIs corporate term, is not valid.
/he appellate court areed 0ith the ECIs submission that an e>tension of the corporate term is a rant of afresh license for a corporation to act as a 1uridical bein endo0ed 0ith the po0ers e>pressly besto0ed by thetate. As such, it is not an ordinary amendment but is analoous to the filin of ne0 articles of incorporation.
?o0ever, the Court of Appeals ruled that Memorandum Circular No. ', eries of )** is leally invalid andineffective for not havin been published in accordance 0ith la0. /he challened memorandum circular,accordin to the appellate court, is not merely an internal or interpretative rule, but affects the public ineneral. ?ence, its publication is re6uired for its effectivity.
/he appellate court denied reconsideration in a Resolution dated !une *, '77.
%n its Memorandum+ dated eptember 4, '77+, the EC arues that it issued the 6uestioned memorandumcircular in the e>ercise of its deleated leislative po0er to fi> fees and chares. /he filin fees re6uired by itare alleedly uniformly imposed on the transactin public and are essential to its supervisory and reulatoryfunctions. /he fees are not a form of penalty or sanction and, therefore, re6uire no publication.
$or its part, 9MA points out in its Memorandum,4 dated eptember '(, '77+, that EC Memorandum Circular No. ), eries of )*4 refers to the filin fees for amended articles of incorporation 0here the amendmentconsists of e>tendin the term of corporate e>istence. /he 6uestioned circular, on the other hand, refers onlyto filin fees for articles of incorporation. /hus, 9MA arues that the former circular, bein the one thatspecifically treats of applications for the e>tension of corporate term, should apply to its case.
Assumin that Memorandum Circular No. ', eries of )** is applicable, 9MA avers that the latter did nottae effect and cannot be the basis for the imposition of the fees stated therein for the reasons that it 0asneither filed 0ith the Gniversity of the Philippines =a0 Center nor published either in the 3fficial 9a&ette or ina ne0spaper of eneral circulation as re6uired under e>istin la0s.
%t should be mentioned at the outset that the authority of the EC to collect and receive fees as authori&ed byla0 is not in 6uestion.8 %ts po0er to collect fees for e>aminin and filin articles of incorporation and by-la0sand amendments thereto, certificates of increase or decrease of the capital stoc, amon others, isreconi&ed. =ie0ise established is its po0er under ec. 8 of P.2. No. *7'-A to recommend to the Presidentthe revision, alteration, amendment or ad1ustment of the chares 0hich it is authori&ed to collect.
/he sub1ect of the present in6uiry is not the authority of the EC to collect and receive fees and chares, butrather the validity of its imposition on the basis of a memorandum circular 0hich, the Court of Appeals held, isineffective.
Republic Act No. (+() :R.A. No. (+(); provides that 0here the amendment consists in e>tendin the term ofcorporate e>istence, the EC shall be entitled to collect and receive for the filin of the amended articles ofincorporation the same fees collectible under e>istin la0 as the filin of articles of incorporation. As isclearly the import of this la0, the EC shall be entitled to collect and receive the same fees it assesses and
collects both for the filin of articles of incorporation and the filin of an amended articles of incorporation forpurposes of e>tendin the term of corporate e>istence.
/he EC, effectuatin its mandate under the afore6uoted la0 and other pertinent la0s,* issued ECMemorandum Circular No. ), eries of )*4, imposin the filin fee of )O)7 of ) of the authori&ed capitalstoc but not less than P(77.77 nor more than P)77,777.77 for stoc corporations, and )O)7 of ) of theauthori&ed capital stoc but not less than P'77.77 nor more than P)77,777.77 for stoc corporations 0ithoutpar value, for the filin of amended articles of incorporation 0here the amendment consists of e>tendin theterm of corporate e>istence.
everal years after, the EC issued Memorandum Circular No. ', eries of )**, imposin ne0 fees andchares and deletin the ma>imum filin fee set forth in EC Circular No. ), eries of )*4, such that the fee
for the filin of articles of incorporation became )O)7 of ) of the authori&ed capital stoc plus '7 thereofbut not less thanP+77.77.
A readin of the t0o circulars readily reveals that they indeed pertain to different matters, as 9MA points out.EC Memorandum Circular No. ), eries of )*4 refers to the filin fee for the amendment of articles ofincorporation to e>tend corporate life, 0hile Memorandum Circular No. ', eries of )** pertains to the filinfee for articles of incorporation. /hus, as 9MA arues, the former circular, bein s6uarely applicable and,more importantly, bein more favorable to it, should be follo0ed.
#hat this proposition fails to consider, ho0ever, is the clear directive of R.A. No. (+() to impose the samefees for the filin of articles of incorporation and the filin of amended articles of incorporation to reflect ane>tension of corporate term. R.A. No. (+() provides an unmistaable standard 0hich should uide the EC in
fi>in and imposin its rates and fees. %f such mandate 0ere the only consideration, the Court 0ould havebeen inclined to rule that the EC 0as correct in imposin the filin fees as outlined in the 6uestionedmemorandum circular, 9MAIs arument not0ithstandin.
?o0ever, 0e aree 0ith the Court of Appeals that the 6uestioned memorandum circular is invalid as it doesnot appear from the records that it has been published in the 3fficial 9a&ette or in a ne0spaper of eneralcirculation. E>ecutive 3rder No. '77, 0hich repealed Art. ' of the Civil Code, provides that la0s shall taeeffect after fifteen days follo0in the completion of their publication either in the 3fficial 9a&ette or in ane0spaper of eneral circulation in the Philippines, unless it is other0ise provided.
%n 'a(ada v. 'uvera,)7 the Court, e>poundin on the publication re6uirement, held<
#e hold therefore that all statutes, includin those of local application and private la0s, shall bepublished as a condition for their effectivity, 0hich shall bein fifteen days after publication unless adifferent effectivity date is fi>ed by the leislature.
Covered by this rule are presidential decrees and e>ecutive orders promulated by the President inthe e>ercise of leislative po0ers 0henever the same are validly deleated by the leislature, or, atpresent, directly conferred by the Constitution. Administrative rules and reulations must also bepublished if their purpose is to enforce or implement e>istin la0 pursuant also to a valid deleation.
%nterpretative reulations and those merely internal in nature, that is, reulatin only the personnel ofthe administrative aency and not the public, need not be published. Neither is publication re6uired of
the so-called letters of instructions issued by administrative superiors concernin the rules oruidelines to be follo0ed by their subordinates in the performance of their duties. ))
/he 6uestioned memorandum circular, furthermore, has not been filed 0ith the 3ffice of the National Administrative Reister of the Gniversity of the Philippines =a0 Center as re6uired in the Administrative Codeof )*8.)'
%n Philsa )nternational Place*ent and Services Corp. v. Secretary of #abor and E*ploy*ent ,)( Memorandum
Circular No. ', eries of )*( of the Philippine 3verseas Employment Administration, 0hich provided for theschedule of placement and documentation fees for private employment aencies or authority holders, 0asstruc do0n as it 0as not published or filed 0ith the National Administrative Reister.
/he 6uestioned memorandum circular, it should be emphasi&ed, cannot be construed as simply interpretativeof R.A. No. (+(). /his administrative issuance is an implementation of the mandate of R.A.
No. (+() and indubitably reulates and affects the public at lare. %t cannot, therefore, be considered a mereinternal rule or reulation, nor an interpretation of the la0, but a rule 0hich must be declared ineffective as it0as neither published nor filed 0ith the 3ffice of the National Administrative Reister.
A related factor 0hich precludes consideration of the 6uestioned issuance as interpretative in nature merely is
the fact the ECIs assessment amountin to P),')','77.77 is e>ceedinly unreasonable and amounts to animposition. A filin fee, by leal definition, is that chared by a public official to accept a document forprocessin. /he fee should be 1ust, fair, and proportionate to the service for 0hich the fee is bein collected, inthis case, the e>amination and verification of the documents submitted by 9MA to 0arrant an e>tension of itscorporate term.
Rate-fi>in is a leislative function 0hich concededly has been deleated to the EC by R.A. No. (+() andother pertinent la0s. /he due process clause, ho0ever, permits the courts to determine 0hether the reulationissued by the EC is reasonable and 0ithin the bounds of its rate-fi>in authority and to strie it do0n 0hen itarbitrarily infrines on a personIs riht to property.
#?ERE$3RE, the petition is 2EN%E2. /he 2ecision of the Court of Appeals in CA-9.R. P No. 4)4(, dated
$ebruary '7, '77, and its Resolution, dated !une *, '77, are A$$%RME2. No pronouncement as to costs.
% attest that the conclusions in the above 2ecision had been reached in consultation before the case 0asassined to the 0riter of the opinion of the CourtIs 2ivision.
LEON!R%O !. UISUMING Associate !ustice
Chairperson
CERTI$IC!TION
Pursuant to ection )(, Article H%%% of the Constitution, and the 2ivision ChairpersonIs Attestation, it is herebycertified that the conclusions in the above 2ecision 0ere reached in consultation before the case 0asassined to the 0riter of the opinion of the CourtIs 2ivision.
RE#N!TO S. PUNOChief !ustice
$oo/oe
T Additional member in lieu of Associate !ustice Arturo 2. Brion per pecial 3rder.
) Rollo, pp. )7-)*5 Penned by Associate !ustice Amelita 9. /olentino and concurred in by Associate!ustices Eloy R. Bello, !r. and Arturo 2. Brion :no0 an Associate !ustice of this Court;.
' %d. at ))-)'.
( %d. at *)-))+.
%d. at +8.
+ %d. at )*4-'').
4 %d. at '()-'*.
8 ec. )(* of B.P. Bl. 4 authori&es the EC to collect and receive fees as authori&ed by la0 or byrules and reulations promulated by it.
An Act to $urther Amend ection Eihteen of the Corporation =a0.
/he ecurities and E>chane Commissioner shall be entitled to collect and receive the sum often pesos for filin said copy of the amended articles of incorporation< Provided, ho0ever, /hat0here the amendment consists in e>tendin the term of corporate e>istence the ecurities andE>chane Commissioner shall be entitled to collect and receive for the filin of the amendedarticles of incorporation the same fees collectible under e>istin la0 for the filin of articles ofincorporation.
> > >
R.A. No. (+() too effect on !une '7, )*4(.
* Presidential 2ecree *7'-A, R.A. No. ))(, and the Revised ecurities Act.
ec. (. $ilin.L:); Every aency shall file 0ith the Gniversity of the Philippines =a0 Centerthree :(; certified copies of every rule adopted by it. Rules in force on the date of effectivity ofthis Code 0hich are not filed 0ithin three :(; months from that date shall not thereafter be thebasis of any sanction aainst any party or persons.
:'; /he records officer of the aency, or his e6uivalent functionary, shall carry out there6uirements of this section under pain of disciplinary action.
:(; A permanent reister of all rules shall be ept by the issuin aency and shall be open topublic inspection.
)( 7 Phil. '87 :'77); cited in National Association of Electricity Consumers for Reforms:NAEC3RE; v. Enery Reulatory Commission, 9.R. No. )4(*(+, $ebruary ', '774, ) CRA 7,+'7.
Before us are consolidated Petitions for Revie0 under Rule + of the Rules of Court assailin the2ecision)promulated on '* April '77* of the Court of Appeals in CA-9.R. P No. *8*'+.
/?E $AC/
/he facts, as culled from the records, are as follo0s<
3n )' !uly )*+8, by virtue of Proclamation No. '(, President Carlos P. 9arcia reserved parcels of land in theMunicipalities of Pasi, /aui, ParaFa6ue, Province of Ri&al and Pasay City for a military reservation. /hemilitary reservation, then no0n as $ort #illiam Mcinley, 0as later on renamed $ort Andres Bonifacio :$ortBonifacio;.
3n ' May )*48, President $erdinand E. Marcos :President Marcos; issued Proclamation No. '7, amendinProclamation No. '(, 0hich e>cluded a certain area of $ort Bonifacio and reserved it for a national shrine./he e>cluded area is no0 no0n as =ibinan n ma Bayani, 0hich is under the administration of herein
respondent Military hrine ervices L Philippine Heterans Affairs 3ffice :M-PHA3;.
Aain, on 8 !anuary )*4, President Marcos issued Proclamation No. '84, further amendin ProclamationNo. '(, 0hich e>cluded baranays=o0er Bicutan, Gpper Bicutan and inal Hillae from the operation ofProclamation No. '( and declared it open for disposition under the provisions of Republic Act Nos. :R.A.;'8 and 8(7.
At the bottom of Proclamation No. '84, President Marcos made a hand0ritten addendum, 0hich reads<
/he cru> of the controversy started 0hen Proclamation No. '84 0as published in the 3fficial 9a&ette( on ($ebruary )*4, 0ithout the above-6uoted addendum.
Jears later, on )4 3ctober )*8, President Cora&on C. A6uino :President A6uino; issued Proclamation No.)8' 0hich substantially reiterated Proclamation No. '84, as published, but this time e>cluded =ots ) and ' of#estern Bicutan from the operation of Proclamation No. '( and declared the said lots open for disposition
under the provisions of R.A. '8 and 8(7.
Memorandum 3rder No. ))*, implementin Proclamation No. )8', 0as issued on the same day.
/hrouh the years, informal settlers increased and occupied some areas of $ort Bonifacio includin portionsof the =ibinan n ma Bayani. /hus, Briadier 9eneral $redelito Bautista issued 9eneral 3rder No. )('(creatin /as $orce Bantay :/$B;, primarily to prevent further unauthori&ed occupation and to cause thedemolition of illeal structures at $ort Bonifacio.
3n '8 Auust )***, members of petitioner Naaaisan Maralita n itio Masiasi, %nc. :NMM%; filed aPetition 0ith the Commission on ettlement of =and Problems :C3=AP;, 0here it 0as doceted as C3=APCase No. **-(. /he Petition prayed for the follo0in< :); the reclassification of the areas they occupied,
coverin =ot ( of #3-)(-777-'* of #estern Bicutan, from public land to alienable and disposable landpursuant to Proclamation No. '845 :'; the subdivision of the sub1ect lot by the 2irector of =ands5 and :(; the=and Manaement BureauIs facilitation of the distribution and sale of the sub1ect lot to its bona fideoccupants.
3n ) eptember '777, petitioner #estern Bicutan =ot 30ners Association, %nc. :#B=3A%; filed a Petition-in-%ntervention substantially prayin for the same reliefs as those prayed for by NMM% 0ith reard to the areathe former then occupied coverin =ot 8 of #3-77-77)(7' in #estern Bicutan.+
/hus, on ) eptember '774, C3=AP issued a Resolution4 rantin the Petition and declarin the portions ofland in 6uestion alienable and disposable, 0ith Associate Commissioner =ina Auilar-9eneral dissentin. 8
/he C3=AP ruled that the hand0ritten addendum of President Marcos 0as an interal part of ProclamationNo. '84, and 0as therefore, controllin. /he intention of the President could not be defeated by thenelience or inadvertence of others. $urther, considerin that Proclamation
No. '84 0as done 0hile the former President 0as e>ercisin leislative po0ers, it could not be amended,repealed or superseded, by a mere e>ecutive enactment. /hus, Proclamation No. )8' could not havesuperseded much less displaced Proclamation No. '84, as the latter 0as issued on 3ctober )4, )*8 0henPresident A6uinoIs leislative po0er had ceased.
%n her 2issentin 3pinion, Associate Commissioner =ina Auilar9eneral stressed that pursuant to Article ' ofthe Civil Code, publication is indispensable in every case. =ie0ise, she held that 0hen the provision of thela0 is clear and unambiuous so that there is no occasion for the court to loo into leislative intent, the la0must be taen as it is, devoid of 1udicial addition or subtraction. $inally, she maintained that the Commissionhad no authority to supply the addendum oriinally omitted in the published version of Proclamation No. '84,as to do so 0ould be tantamount to encroachin on the field of the leislature.
?erein respondent M-PHA3 filed a Motion for Reconsideration,* 0hich 0as denied by the C3=AP in aResolution dated ' !anuary '778.)7
M-PHA3 filed a Petition 0ith the Court of Appeals seein to reverse the C3=AP Resolutions dated )eptember '774 and ' !anuary '778.
/hus, on '* April '77*, the then Court of Appeals $irst 2ivision rendered the assailed 2ecision rantin M-PHA3Is Petition, the dispositive portion of 0hich reads<
%N H%E# 3$ A== /?E $3RE93%N9, the instant petition is hereby 9RAN/E2. /he Resolutions datedeptember ), '774 and !anuary ', '778 issued by the Commission on the ettlement of =and Problems inC3=AP Case No. **-( are hereby REHERE2 and E/ A%2E. %n lieu thereof, the petitions ofrespondents in C3=AP Case No. **-( are 2%M%E2, for lac of merit, as discussed herein. $urther,pendin urent motions filed by respondents are lie0ise
2EN%E2. 3 3R2ERE2.)) :Emphasis in the oriinal;
Both NMM%)' and #B=3A%)( appealed the said 2ecision by filin their respective Petitions for Revie0 0iththis Court under Rule + of the Rules of Court.
Both Petitions boil do0n to the principal issue of 0hether the Court of Appeals erred in rulin that the sub1ectlots 0ere not alienable and disposable by virtue of Proclamation No. '84 on the round that the hand0rittenaddendum of President Marcos 0as not included in the publication of the said la0.
/?E C3GR/I RG=%N9
#e deny the Petitions for lac of merit.
Considerin that petitioners 0ere occupyin =ots ( and 8 of #estern Bicutan :sub1ect lots;, their claims 0ereanchored on the hand0ritten addendum of President Marcos to Proclamation No. '84. /hey allee that the
former President intended to include all #estern Bicutan in the reclassification of portions of $ort Bonifacio asdisposable public land 0hen he made a notation 1ust belo0 the printed version of Proclamation No. '84.
?o0ever, it is undisputed that the hand0ritten addendum 0as not included 0hen Proclamation No. '84 0aspublished in the 3fficial 9a&ette.
/he resolution of 0hether the sub1ect lots 0ere declared as reclassified and disposable lies in thedetermination of 0hether the hand0ritten addendum of President Marcos has the force and effect of la0. %n
relation thereto, Article ' of the Civil Code e>pressly provides<
AR/. '. =a0s shall tae effect after fifteen days follo0in the completion of their publication in the 3fficial9a&ette, unless it is other0ise provided. /his Code shall tae effect one year after such publication.
Gnder the above provision, the re6uirement of publication is indispensable to ive effect to the la0, unless thela0 itself has other0ise provided. /he phrase unless other0ise provided refers to a different effectivity dateother than after fifteen days follo0in the completion of the la0Is publication in the 3fficial 9a&ette, but doesnot imply that the re6uirement of publication may be dispensed 0ith. /he issue of the re6uirement ofpublication 0as already settled in the landmar case /aFada v. ?on. /uvera,)4 in 0hich 0e had the occasion torule thus<
Publication is indispensable in every case, but the leislature may in its discretion provide that the usualfifteen-day period shall be shortened or e>tended. An e>ample, as pointed out by the present Chief !ustice inhis separate concurrence in the oriinal decision, is the Civil Code 0hich did not become effective after fifteendays from its publication in the 3fficial 9a&ette but one year after such publication. /he eneral rule did notapply because it 0as other0ise provided.
%t is not correct to say that under the disputed clause publication may be dispensed 0ith altoether. /hereason is that such omission 0ould offend due process insofar as it 0ould deny the public no0lede of thela0s that are supposed to overn it. urely, if the leislature could validly provide that a la0 shall becomeeffective immediately upon its approval not0ithstandin the lac of publication :or after an unreasonably shortperiod after publication;, it is not unliely that persons not a0are of it 0ould be pre1udiced as a result5 and they0ould be so not because of a failure to comply 0ith it but simply because they did not no0 of its e>istence.
inificantly, this is not true only of penal la0s as is commonly supposed. 3ne can thin of many non-penalmeasures, lie a la0 on prescription, 0hich must also be communicated to the persons they may affect beforethey can bein to operate.
> > > >
/he term la0s should refer to all la0s and not only to those of eneral application, for strictly speain allla0s relate to the people in eneral albeit there are some that do not apply to them directly. An e>ample is ala0 rantin citi&enship to a particular individual, lie a relative of President Marcos 0ho 0as decreed instantnaturali&ation. %t surely cannot be said that such a la0 does not affect the public althouh it un6uestionablydoes not apply directly to all the people. /he sub1ect of such la0 is a matter of public interest 0hich anymember of the body politic may 6uestion in the political forums or, if he is a proper party, even in the courts of
1ustice. %n fact, a la0 0ithout any bearin on the public 0ould be invalid as an intrusion of privacy or as classleislation or as an ultra vires act of the leislature. /o be valid, the la0 must invariably affect the publicinterest even if it miht be directly applicable only to one individual, or some of the people only, and not to thepublic as a 0hole.
#e hold therefore that all statutes, includin those of local application and private la0s, shall be published asa condition for their effectivity, 0hich shall bein fifteen days after publication unless a different effectivity dateis fi>ed by the leislature.
Covered by this rule are presidential decrees and e>ecutive orders promulated by the President in thee>ercise of leislative po0ers 0henever the same are validly deleated by the leislature or, at present,
directly conferred by the Constitution. Administrative rules and reulations must also be published if theirpurpose is to enforce or implement e>istin la0 pursuant also to a valid deleation.
> > > >
Accordinly, even the charter of a city must be published not0ithstandin that it applies to only a portion of thenational territory and directly affects only the inhabitants of that place. All presidential decrees must bepublished, includin even, say, those namin a public place after a favored individual or e>emptin him from
certain prohibitions or re6uirements. /he circulars issued by the Monetary Board must be published if they aremeant not merely to interpret but to fill in the details of the Central Ban Act 0hich that body is supposed toenforce.
> > > >
#e aree that the publication must be in full or it is no publication at all since its purpose is to inform thepublic of the contents of the la0s. As correctly pointed out by the petitioners, the mere mention of the numberof the presidential decree, the title of such decree, its 0hereabouts :e.., 0ith ecretary /uvera;, thesupposed date of effectivity, and in a mere supplement of the 3fficial 9a&ette cannot satisfy the publicationre6uirement.&+,phi& /his is not even substantial compliance. /his 0as the manner, incidentally, in 0hich the9eneral Appropriations Act for $J )*8+, a presidential decree undeniably of eneral applicability and interest,
0as published by the Marcos administration. /he evident purpose 0as to 0ithhold rather than discloseinformation on this vital la0.
> > > >
=a0s must come out in the open in the clear liht of the sun instead of sulin in the shado0s 0ith their dar,deep secrets. Mysterious pronouncements and rumored rules cannot be reconi&ed as bindin unless theire>istence and contents are confirmed by a valid publication intended to mae full disclosure and ive propernotice to the people. /he furtive la0 is lie a scabbarded saber that cannot feint, parry or cut unless the naedblade is dra0n. :Emphases supplied;
Applyin the foreoin rulin to the instant case, this Court cannot rely on a hand0ritten note that 0as not par
of Proclamation No. '84 as published. #ithout publication, the note never had any leal force and effect.
$urthermore, under ection ', Chapter 4, Boo % of the Administrative Code, the publication of any la0,resolution or other official documents in the 3fficial 9a&ette shall be prima facie evidence of its authority./hus, 0hether or not President Marcos intended to include #estern Bicutan is not only irrelevant butspeculative. imply put, the courts may not speculate as to the probable intent of the leislature apart fromthe 0ords appearin in the la0.)8 /his Court cannot rule that a 0ord appears in the la0 0hen, evidently, thereis none. %n Papalain ?aulers, %nc. v. ?on. /ra1ano,) 0e ruled that under Article of the Civil Code, "1udicialdecisions applyin or interpretin the la0s or the Constitution shall form a part of the leal system of thePhilippines." /his does not mean, ho0ever, that courts can create la0. /he courts e>ist for interpretin the la0,not for enactin it. /o allo0 other0ise 0ould be violative of the principle of separation of po0ers, inasmuch asthe sole function of our courts is to apply or interpret the la0s, particularly 0here aps or lacunae e>ist or
0here ambiuities becloud issues, but it 0ill not arroate unto itself the tas of leislatin. /he remedysouht in these Petitions is not 1udicial interpretation, but another leislation that 0ould amend the la0 toinclude petitioners" lots in the reclassification.
#?ERE$3RE, in vie0 of the foreoin, the instant petitions are hereby 2EN%E2 for lac of merit. /heassailed 2ecision of the Court of Appeals in CA-9.R. CH No. *8*'+ dated '* April '77* is A$$%RME2 in toto.
Accordinly, this Court"s status 6uo order dated )8 !une '77* is hereby =%$/E2. =ie0ise, all pendinmotions to cite respondent in contempt is 2EN%E2, havin been rendered moot. No costs.
/he respondents, throuh the olicitor 9eneral, 0ould have this case dismissed outriht on the round that
petitioners have no leal personality or standin to brin the instant petition. /he vie0 is submitted that in theabsence of any sho0in that petitioners are personally and directly affected or pre1udiced by the alleed non-
publication of the presidential issuances in 6uestion 2 said petitioners are 0ithout the re6uisite leal
personality to institute this mandamus proceedin, they are not bein arieved parties 0ithin the meanin
of ection (, Rule 4+ of the Rules of Court, 0hich 0e 6uote<
EC. (. Petition for -anda*us.#hen any tribunal, corporation, board or person unla0fully
nelects the performance of an act 0hich the la0 specifically en1oins as a duty resultin from
an office, trust, or station, or unla0fully e>cludes another from the use a rd en1oyment of a riht
or office to 0hich such other is entitled, and there is no other plain, speedy and ade6uate
remedy in the ordinary course of la0, the person arieved thereby may file a verified petition
in the proper court allein the facts 0ith certainty and prayin that 1udment be rendered
commandin the defendant, immediately or at some other specified time, to do the act re6uired
to be done to Protect the rihts of the petitioner, and to pay the damaes sustained by the
petitioner by reason of the 0ronful acts of the defendant.
Gpon the other hand, petitioners maintain that since the sub1ect of the petition concerns a public riht and its
ob1ect is to compel the performance of a public duty, they need not sho0 any specific interest for their petition
to be iven due course.
/he issue posed is not one of first impression. As early as the )*)7 case of Severino vs. Governor
General ,3
this Court held that 0hile the eneral rule is that a 0rit of mandamus 0ould be ranted to a privateindividual only in those cases 0here he has some private or particular interest to be subserved, or some
particular riht to be protected, independent of that 0hich he holds 0ith the public at lare, and it is for the
public officers e>clusively to apply for the 0rit 0hen public rihts are to be subserved Mithchell vs. Boardmen,
8* M.e., 4*D, nevertheless, 0hen the 6uestion is one of public riht and the ob1ect of the mandamus is to
procure the enforcement of a public duty, the people are rearded as the real party in interest and the relator
at 0hose instiation the proceedins are instituted need not sho0 that he has any leal or special interest in
the result, it bein sufficient to sho0 that he is a citi&en and as such interested in the e>ecution of the la0s
?ih, E>traordinary =eal Remedies, (rd ed., sec. ()D.
/hus, in said case, this Court reconi&ed the relator =ope everino, a private individual, as a proper party to
the mandamus proceedins brouht to compel the 9overnor 9eneral to call a special election for the position
of municipal president in the to0n of ilay, Neros 3ccidental. peain for this Court, Mr. !ustice 9rant /.
/rent said<
#e are therefore of the opinion that the 0eiht of authority supports the proposition that the
relator is a proper party to proceedins of this character 0hen a public riht is souht to be
enforced. %f the eneral rule in America 0ere other0ise, 0e thin that it 0ould not be applicableto the case at bar for the reason "that it is al0ays danerous to apply a eneral rule to a
particular case 0ithout eepin in mind the reason for the rule, because, if under the particular
circumstances the reason for the rule does not e>ist, the rule itself is not applicable and
reliance upon the rule may 0ell lead to error"
No reason e>ists in the case at bar for applyin the eneral rule insisted upon by counsel for
the respondent. /he circumstances 0hich surround this case are different from those in the
Gnited tates, inasmuch as if the relator is not a proper party to these proceedins no other
person could be, as 0e have seen that it is not the duty of the la0 officer of the 9overnment to
appear and represent the people in cases of this character.
/he reasons iven by the Court in reconi&in a private citi&en"s leal personality in the aforementioned case
apply s6uarely to the present petition. Clearly, the riht souht to be enforced by petitioners herein is a public
riht reconi&ed by no less than the fundamental la0 of the land. %f petitioners 0ere not allo0ed to institute
this proceedin, it 0ould indeed be difficult to conceive of any other person to initiate the same, considerin
that the olicitor 9eneral, the overnment officer enerally empo0ered to represent the people, has entered
his appearance for respondents in this case.
Respondents further contend that publication in the 3fficial 9a&ette is not a sine 6ua non re6uirement for the
effectivity of la0s 0here the la0s themselves provide for their o0n effectivity dates. %t is thus submitted that
since the presidential issuances in 6uestion contain special provisions as to the date they are to tae effect,
publication in the 3fficial 9a&ette is not indispensable for their effectivity. /he point stressed is anchored on
Article ' of the Civil Code<
Art. '. =a0s shall tae effect after fifteen days follo0in the completion of their publication in
the 3fficial 9a&ette, unless it is other0ise provided, ...
/he interpretation iven by respondent is in accord 0ith this Court"s construction of said article. %n a lon line
of decisions, 4 this Court has ruled that publication in the 3fficial 9a&ette is necessary in those cases 0here
the leislation itself does not provide for its effectivity date-for then the date of publication is material for
determinin its date of effectivity, 0hich is the fifteenth day follo0in its publication-but not 0hen the la0 itself
provides for the date 0hen it oes into effect.
Respondents" arument, ho0ever, is loically correct only insofar as it e6uates the effectivity of la0s 0ith the
fact of publication. Considered in the liht of other statutes applicable to the issue at hand, the conclusion is
easily reached that said Article ' does not preclude the re6uirement of publication in the 3fficial 9a&ette, even
if the la0 itself provides for the date of its effectivity. /hus, ection ) of Common0ealth Act 4( provides as
follo0s<
ection ). /here shall be published in the 3fficial 9a&ette )D all important leisiative acts and
resolutions of a public nature of the, Conress of the Philippines5 'D all e>ecutive and
administrative orders and proclamations, e>cept such as have no eneral applicability5 (D
decisions or abstracts of decisions of the upreme Court and the Court of Appeals as may be
deemed by said courts of sufficient importance to be so published5 D such documents or
classes of documents as may be re6uired so to be published by la05 and +D such documents
or classes of documents as the President of the Philippines shall determine from time to time to
have eneral applicability and leal effect, or 0hich he may authori&e so to be published. ...
/he clear ob1ect of the above-6uoted provision is to ive the eneral public ade6uate notice of the variousla0s 0hich are to reulate their actions and conduct as citi&ens. #ithout such notice and publication, there
0ould be no basis for the application of the ma>im inorantia leis non e>cusat. %t 0ould be the heiht of
in1ustice to punish or other0ise burden a citi&en for the transression of a la0 of 0hich he had no notice
0hatsoever, not even a constructive one.
Perhaps at no time since the establishment of the Philippine Republic has the publication of la0s taen so
vital sinificance that at this time 0hen the people have besto0ed upon the President a po0er heretofore
en1oyed solely by the leislature. #hile the people are ept abreast by the mass media of the debates and
deliberations in the Batasan Pambansaand for the dilient ones, ready access to the leislative records
no such publicity accompanies the la0-main process of the President. /hus, 0ithout publication, the people
have no means of no0in 0hat presidential decrees have actually been promulated, much less a definite0ay of informin themselves of the specific contents and te>ts of such decrees. As the upreme Court of
pain ruled< Ba1o la denominacion enerica de leyes, se comprenden tambien los relamentos, Reales
decretos, %nstrucciones, Circulares y Reales ordines dictadas de conformidad con las mismas por el 9obierno
en uso de su potestad. '
/he very first clause of ection % of Common0ealth Act 4( reads< /here shall be published in the 3fficial
9a&ette ... . /he 0ord shall used therein imposes upon respondent officials an imperative duty. /hat duty
must be enforced if the Constitutional riht of the people to be informed on matters of public concern is to be
iven substance and reality. /he la0 itself maes a list of 0hat should be published in the 3fficial 9a&ette.
uch listin, to our mind, leaves respondents 0ith no discretion 0hatsoever as to 0hat must be included or
e>cluded from such publication.
/he publication of all presidential issuances of a public nature or of eneral applicability is mandated by
la0. 3bviously, presidential decrees that provide for fines, forfeitures or penalties for their violation or
other0ise impose a burden or. the people, such as ta> and revenue measures, fall 0ithin this cateory. 3ther
presidential issuances 0hich apply only to particular persons or class of persons such as administrative and
e>ecutive orders need not be published on the assumption that they have been circulari&ed to all concerned. 6
%t is needless to add that the publication of presidential issuances of a public nature or of eneral
applicability is a re6uirement of due process. %t is a rule of la0 that before a person may be bound by la0, he
must first be officially and specifically informed of its contents. As !ustice Claudio /eehanee said in Peraltavs. CO-E#EC (<
%n a time of proliferatin decrees, orders and letters of instructions 0hich all form part of the la0
of the land, the re6uirement of due process and the Rule of =a0 demand that the 3fficial
9a&ette as the official overnment repository promulate and publish the te>ts of all such
decrees, orders and instructions so that the people may no0 0here to obtain their official and
/he Court therefore declares that presidential issuances of eneral application, 0hich have not been
published, shall have no force and effect. ome members of the Court, 6uite apprehensive about the possible
unsettlin effect this decision miht have on acts done in reliance of the validity of those presidential decrees
0hich 0ere published only durin the pendency of this petition, have put the 6uestion as to 0hether the
Court"s declaration of invalidity apply to P.2.s 0hich had been enforced or implemented prior to their
publication. /he ans0er is all too familiar. %n similar situations in the past this Court had taen the pramatic
and realistic course set forth in Chicot County %raina"e %istrict vs. Bater Ban/ 8 to 0it<
/he courts belo0 have proceeded on the theory that the Act of Conress, havin been found to
be unconstitutional, 0as not a la05 that it 0as inoperative, conferrin no rihts and imposin no
duties, and hence affordin no basis for the challened decree. Norton v. helby County, ))
G.. '+, '5 Chicao, ). K =. Ry. Co. v. ?acett, '' G.. ++*, +44. %t is 6uite clear, ho0ever,
that such broad statements as to the effect of a determination of unconstitutionality must be
taen 0ith 6ualifications. /he actual e>istence of a statute, prior to such a determination, is an
operative fact and may have conse6uences 0hich cannot 1ustly be inored. /he past cannot
al0ays be erased by a ne0 1udicial declaration. /he effect of the subse6uent rulin as to
invalidity may have to be considered in various aspects-0ith respect to particular conduct,
private and official. @uestions of rihts claimed to have become vested, of status, of prior
determinations deemed to have finality and acted upon accordinly, of public policy in the lihtof the nature both of the statute and of its previous application, demand e>amination. /hese
6uestions are amon the most difficult of those 0hich have enaed the attention of courts,
state and federal and it is manifest from numerous decisions that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be 1ustified.
Consistently 0ith the above principle, this Court in 0utter vs. Esteban 9 sustained the riht of a party under the
Moratorium =a0, albeit said riht had accrued in his favor before said la0 0as declared unconstitutional by
this Court.
imilarly, the implementationOenforcement of presidential decrees prior to their publication in the 3fficial
9a&ette is an operative fact 0hich may have conse6uences 0hich cannot be 1ustly inored. /he past cannot
al0ays be erased by a ne0 1udicial declaration ... that an all-inclusive statement of a principle of absolute
retroactive invalidity cannot be 1ustified.
$rom the report submitted to the Court by the Cler of Court, it appears that of the presidential decrees souht
by petitioners to be published in the 3fficial 9a&ette, only Presidential 2ecrees Nos. )7)* to )7(7, inclusive,
)'8, and )*(8 to )*(*, inclusive, have not been so published. 10 Neither the sub1ect matters nor the te>ts of
these P2s can be ascertained since no copies thereof are available. But 0hatever their sub1ect matter may
be, it is undisputed that none of these unpublished P2s has ever been implemented or enforced by the
overnment. %n Pesi"an vs. !n"eles, 11 the Court, throuh !ustice Ramon A6uino, ruled that publication is
necessary to apprise the public of the contents of penalD reulations and mae the said penalties bindin onthe persons affected thereby. /he coency of this holdin is apparently reconi&ed by respondent officials
considerin the manifestation in their comment that the overnment, as a matter of policy, refrains from
prosecutin violations of criminal la0s until the same shall have been published in the 3fficial 9a&ette or in
some other publication, even thouh some criminal la0s provide that they shall tae effect immediately.
#?ERE$3RE, the Court hereby orders respondents to publish in the 3fficial 9a&ette all unpublished
presidential issuances 0hich are of eneral application, and unless so published, they shall have no bindin
