Administrative Law 5

Administrative Law 5
G.R. No. 179844
March 23, 2011
(sic) Romualdez are absolute and lawful owners of separate parcels of

lands, each parcel with an area of 36,670 square meters, 47,187.50
square meters and 55,453 square meters, respectively, all situated [in]
EMERSON B. BAGONGAHASA, GIRLIE B.
BAGONGAHASA, DEPARTMENT OF AGRARIAN REFORM - Sitio Papatahan, Paete, Laguna. Johanna and Dietmar purchased their
PROVINCIAL AGRARIAN REFORM OFFICER OF LAGUNA, properties from Roberto Manalo on January 6, 1994; while Sps.
Daniel and [Ana], as well as Jacqueline bought their landholdings
and REGISTER OF DEEDS OF SINOLOAN,
from Leonisa A. Zarraga on August 5, 1998. They allege that the said
LAGUNA, Petitioners,
properties are planted [with] different fruit-bearing trees. They and
vs.
their predecessors-in-interest have been paying realty taxes due on the
JOHANNA L. ROMUALDEZ, Respondent.
properties up to the present. However, sometime in 1994 and 1995,
the then Secretary of Agrarian Reform declared the property to be
x - - - - - - - - - - - - - - - - - - - - - - -x
part of the public domain, awarded the same to the Defendants and
forthwith issued Certificates of Land Ownership Award (CLOAs) to
SPOUSES CESAR M. CAGUIN and GERTRUDES CAGUIN,
the respective defendants as follows:
SPOUSES TEODORO MADRIDEJOS and ANICETA IBANEZ
MADRIDEJOS, DEPARTMENT OF AGRARIAN REFORM CLOA NO.
BENEFICIARIES
Date of Registration
PROVINCIAL AGRARIAN REFORM OFFICER OF LAGUNA,
and REGISTER OF DEEDS OF SINOLOAN,
In Registry of Deeds of Laguna
LAGUNA, Petitioners,
vs.
1. 00155653
Emerson Bagongahasa,
April 10, 1995 et al.
DIETMAR L. ROMUALDEZ, Respondent.
2. 00155652
Cesar Caguin, et al.
April 10, 1995
x - - - - - - - - - - - - - - - - - - - - - - -x
SOTELA D. ADEA, SPOUSES ESPERANZA and LEONCIO
MARIO, SPOUSES DELIA and DANILO CACHOLA,
SPOUSES MA. ALICIA and REYMUNDO CAINTO,
EDUARDO B. DALAY, SPOUSES JOSE LEVITICO and
EPIFANIA DALAY, SPOUSES JIFFY and FAUSTINO DALAY,
SPOUSES MA. RUTH and MELCHOR PACURIB, MA.
JERIMA B. DALAY, SPOUSES CLEOFAS and TERESITA
VITOR, SPOUSES CELESTINA and ALEJANDRO COSICO,
SPOUSES AUREA and ANTONIO HERNANDEZ, SPOUSES
JULIA and RAFAEL DELA CRUZ, SPOUSES RAQUEL and
SEBASTIAN SAN JUAN, SPOUSES MARGARITA and
PABLITO LLANES, SR., FIDEL M. DALAY, SPOUSES JAIME
and MELVITA DALAY, SPOUSES EMILY and FLORENCIO
PANGAN, SPOUSES FELIPE and ROSALIE DALAY,
SPOUSES MARCELO and CATALINA B. DALAY, and
SPOUSES RENATO and ELIZABETH DALAY, DEPARTMENT
OF AGRARIAN REFORM - PROVINCIAL AGRARIAN
REFORM OFFICER OF LAGUNA, and REGISTER OF
DEEDS OF SINOLOAN, LAGUNA, Petitioners,
vs.
SPOUSES DANIEL and ANA ROMUALDEZ, and
JACQUELINE L. ROMUALDEZ, Respondents.
3. 00119810
Sotela Adea, et al.
June 30, 1994
It was only in 1998 when the complainants learned of the issuance of

said CLOAs by the Register of Deeds of Siniloan, Laguna.
The Complainants pointed out that while the Defendants respective

CLOAs describe a property purportedly located in Sitio Lamao, San
Antonio, Municipality of Kalayaan, Province of Laguna, each of the
Complainants tax declaration describes a property located [in] Sitio
Papatahan, Municipality of Paete, Province of Laguna. Inspite of the
discrepancy in the municipality and sitio of the respective documents,
the lots described in the CLOAs and in the Tax Declarations are
almost identical, except that the property described in Defendants
title covers a larger area, but the title and the tax declaration refer to
the same lot; that they and their predecessors-in-interest have been in
possession of the properties for more than thirty years; that the
Defendants have never been in possession of the same; that they have
not paid any real estate taxes and have not caused the issuance of a
tax declaration over the property in their names; that there is no basis
for the award of certificates of land ownership to the Defendants by
the Secretary of Agrarian Reform, for the lands have already become
private properties by virtue of the open, continuous, exclusive and
notorious possession of the property by the Complainants and/or their
predecessors-in-interest which possession was in the concept of an
owner. As absolute and lawful owners thereof, the complainants also
DECISION
maintain that they have not been notified of any intended coverage
thereof by the DAR; that to the best of their knowledge, there is no
NACHURA, J.:
valuation being conducted by the Land Bank of the Philippines and
the DAR involving the property; that there was no compensation paid
Before this Court is a Consolidated Petition for Review
and that the DAR-CENRO Certification shows that the landholdings
on Certiorari1 under Rule 45 of the Rules of Civil Procedure, seeking have 24-32% slopes and therefore exempt from CARP coverage.
the reversal of the Court of Appeals (CA) Decision2 dated May 31,
2007 and its Amended Decision (Partial)3 dated September 25, 2007. The complainants[,] thus, pray for the reconveyance of their
The facts, as summarized by the Department of Agrarian Reform
Adjudication Board (DARAB) and as quoted by the CA, are as
follows:
It appears that Complainants Johanna L. Romualdez; Dietmar L.
Romualdez; Sps. Daniel and [Ana] Romualdez and Jacquelin[e] C.
respective landholdings; cancellation of the CLOAs and payment of

litigation fee.
On the other hand, the Defendants specifically denied the allegations
of the Plaintiff, maintaining in their Affirmative Defenses that they
are farmer beneficiaries of the subject properties, covered by
Proclamation No. 2280 (sic) which reclassifies certain portion of the
public domain as agricultural land and declares the same alienable

and disposable for agricultural and resettlement purposes of the
Kilusang Kabuhayan at Kaunlaran Land Resource Management
Program of the KKK, Ministry of Human Settlements and the area
covered is Barangay Papatahan, Paete; that the Plaintiffs act of
questioning the issuance of title is an exercise in futility because
Defendants were already in possession of the properties prior to said
Proclamation; that upon the issuance of the CLOAs, they became the
owners of the landholdings and that the complainants claim for
damages has no basis.
On the part of public Respondent PARO, he invoked the doctrine of
regularity in the performance of their official functions and their
adherence in pursuing the implementation of CARP. He claims that
DAR received from the National Livelihood Support Fund (NLSF)
portions of the public domain covered by Presidential Proclamation
No. 2282, Series of 1983 and has been mandated to implement the
agrarian reform laws by distributing alienable and disposable portions
of the public domain, to which the subject lands fall; that actual
investigation, proper screening of applicants-beneficiaries, survey and
proper evaluation were conducted, warranting the generation of the
CLOAs and that the registration of the CLOAs with the Registry of
Deed brought the same under the coverage of the Torrens System of
land registration and have already become indefeasible or
uncontestable.4
On December 28, 2000, the Provincial Agrarian Reform Adjudicator
(PARAD) of Laguna rendered his decision,5finding that the
Department of Agrarian Reform (DAR) Secretary committed a
mistake in placing the subject properties under the Comprehensive
Agrarian Reform Program (CARP). Moreover, the PARAD found
that no notice of coverage was sent to respondents and that they were
also not paid any just compensation. The dispositive portion of the
said decision reads:
1. Sustaining the validity of the subject Certificates of Land

Ownership Award (CLOAs) Nos. 00155653, 00155652 and
00119810 issued to the herein Defendants-Appellants: and
2. Dismissing the instant complaints for lack of merit.
No costs.
SO ORDERED.8
Respondents filed a Motion for Reconsideration, which the DARAB,
however, denied for lack of merit.9 Thus, respondents sought recourse
from the CA.
On May 31, 2007, the CA, invoking Section 1 (1.6), Rule II of the
2003 DARAB Rules of Procedure,10 held that the DARAB has the
exclusive original jurisdiction to determine and adjudicate cases
involving correction, partition, and cancellation of Emancipation
Patents and CLOAs which are registered with the Land Registration
Authority (LRA), as in this case. The CA ratiocinated that other than
the registration of the assailed CLOAs, the RD already issued
Original Certificate of Title No. OCL-474 in favor of respondents.
Moreover, the CA relied on the PARADs finding that respondents
were deprived of due process when no notice of coverage was ever
furnished and no just compensation was paid to them. The CA
disposed of the case in this wise:
WHEREFORE, premises considered, the petition is GRANTED. The
assailed Decision dated May 3, 2005 and the Resolution dated
October 10, 2006 are hereby REVERSED and SET ASIDE. The Joint
Decision of the Provincial Adjudicator dated December 28, 2000 is
hereby REINSTATED with MODIFICATION as follows:
"WHEREFORE, premises considered, judgment is hereby rendered:
WHEREFORE, premises considered, judgment is hereby rendered:

1. Ordering the cancellation of Certificate of Land
Ownership Award (CLOA) NOS. 00155653, 00155652 and
00119810 issued to herein private respondents; [and]
1. Ordering the cancellation of the Certificate of Land

00119810 issued to herein private respondents [petitioners in
the instant case];
2. Ordering the Register of Deeds of Siniloan, Laguna to

cause the cancellation of the Certificate of Land Ownership
Award (CLOA) to herein named defendants.

cause the cancellation of OCT No. OCL-474 to herein
named private respondents [petitioners in the instant case].
SO ORDERED.6
SO ORDERED."
Aggrieved, petitioners appealed to the DARAB.
SO ORDERED.11
In its decision7 dated May 3, 2005, the DARAB held that the
complaints filed were virtual protests against the CARP coverage, to
which it has no jurisdiction. The DARAB further held that, while it
has jurisdiction to cancel the Certificate of Land Ownership Awards
(CLOAs), which had been registered with the Register of Deeds (RD)
of Laguna, it cannot pass upon matters exclusively vested in the DAR
Secretary. Moreover, the DARAB ruled that the assailed CLOAs
having been registered in 1994 and 1995 became incontestable and
indefeasible. Thus:
Both parties filed their respective Motions for Reconsideration. The

CA held, to wit:
Finding petitioners arguments meritorious, We PARTIALLY
AMEND our previous decision in this case by ordering the Register
of Deeds of Siniloan, Laguna to cancel OCT No. OCL-475 and OCT
No. OCL-395 and to issue new certificates of title deducting the area
of 47,187.50 square meters claimed by petitioner Dietmar L.
Romualdez and 55,453.50 square meters claimed by Spouses Daniel
and Ana Romualdez and Jacqueline [L.] Romualdez, respectively.
WHEREFORE, premises considered, the appealed decision is hereby

REVERSED and/or SET ASIDE. A new judgment is hereby entered:
WHEREFORE, premises considered, private respondents Motion for

Reconsideration is hereby DENIED. Petitioners Motion for Partial
Reconsideration is hereby GRANTED. The Decision dated May 31,
2007 is hereby PARTIALLY AMENDED to read as follows:
"WHEREFORE, premises considered, judgment is hereby rendered:
1. Ordering the cancellation of the Certificate of Land
00119810 issued to herein private respondents.
cause the cancellation of OCT No. OCL-474 to herein
named private respondents.
cause the cancellation of OCT No. OCL-475 and to issue a
new one deducting the area of 47,187.50 square meters
claimed by petitioner Dietmar L. Romualdez.
cause the cancellation of OCT No. OCL-395 and to issue a
new one deducting the area of 55,453.50 square meters
claimed by petitioners Spouses Daniel and Ana Romualdez
and Jacqueline L. Romualdez.
SO ORDERED."
SO ORDERED.12
Hence, this Petition, assigning the following as errors:
I.
Court, and that petitioners counsel failed to indicate the full names of
petitioners in the petition. Respondents argue that the errors assigned
by petitioners are matters not pertaining to questions of law but rather
to the CAs factual findings. Respondents rely on the CAs findings
that their constitutional right to due process was violated because no
notice of coverage was sent to them and that they were deprived of
payment of just compensation. Moreover, respondents claim that they
are not barred by prescription and petitioners cannot raise this issue
for the first time on appeal; that they have been paying the real
property taxes and are actually in possession of the subject properties;
and that documents, which petitioners failed to refute, show that the
said properties are private lands owned by respondents and their
predecessors-in-interest. Respondents stress that the action initially
filed before the PARAD was not a protest considered as an Agrarian
Law Implementation (ALI) case, but for quieting and cancellation of
title, reconveyance, and damages; that the 2003 DARAB Rules of
Procedure clearly states that the DARAB has jurisdiction to cancel
CLOAs registered with the LRA; and that the assailed CLOAs were
already registered with the RD of Laguna.16
The petition is impressed with merit.
Verily, our ruling in Heirs of Julian dela Cruz v. Heirs of Alberto
Cruz17 is instructive:
The Court agrees with the petitioners contention that, under Section
2(f), Rule II of the DARAB Rules of Procedure, the DARAB has
jurisdiction over cases involving the issuance, correction and
cancellation of CLOAs which were registered with the LRA.
However, for the DARAB to have jurisdiction in such cases, they
must relate to an agrarian dispute between landowner and tenants to
whom CLOAs have been issued by the DAR Secretary. The cases
involving the issuance, correction and cancellation of the CLOAs by
the DAR in the administrative implementation of agrarian reform
laws, rules and regulations to parties who are not agricultural tenants
or lessees are within the jurisdiction of the DAR and not of the
DARAB.18
The Honorable Court of Appeals has no basis in

REVERSING the DECISION of the Department of Agrarian
Reform Adjudication Board in upholding the validity of
It is established and uncontroverted that the parties herein do not have
Certificate of Land Ownership Award Nos. 00155653,
any tenancy relationship. In one case, this Court held that even if the
00155652 and 00119810 issued to herein petitioners; [and]
parties therein did not have tenancy relations, the DARAB still has
jurisdiction. However, the said case must be viewed with particularity
II.
because, based on the material allegations of the complaint therein,
the incident involved the implementation of the CARP, as it was
The Honorable Court of Appeals erred in undermining [the] founded on the question of who was the actual tenant and eventual
ISSUE OF JURISDICTION as this is cognizable by the
beneficiary of the subject land. Hence, this Court held therein that
Regional Director and not by the PARAD and/or the
jurisdiction should remain with the DARAB and not with the regular
DARAB.13
courts.19
Petitioners Cesar Caguin, Cleofas Vitor, Teresita Vitor, Jose Levitico However, this case is different. Respondents complaint was bereft of
Dalay, Marcelo Dalay, Esperanza Mario, Celestina Cosico, Ma. Ruth any allegation of tenancy and/or any matter that would place it within
Pacurib, and Raquel San Juan, through the Legal Assistance Division the ambit of DARABs jurisdiction.
of the DAR, claim that findings of fact of the DARAB should have
been respected by the CA; that the CLOAs covering the subject
properties were registered in 1994 and 1995 but respondents only
assailed the validity of the same in 2000; and that the said CLOAs are
already incontestable and indefeasible. Moreover, petitioners
highlight the fact that the parties in this case are not partners to any
tenancy venture. Invoking this Courts ruling in Heirs of Julian dela
Cruz v. Heirs of Alberto Cruz,14 petitioners submit that the DAR
Secretary has jurisdiction in this case, not the DARAB.15
On the other hand, respondents prefatorily manifest that out of the 44
respondents before the CA, only 9 signed the petition filed before this
While it is true that the PARAD and the DARAB lack jurisdiction in
this case due to the absence of any tenancy relations between the
parties, lingering essential issues are yet to be resolved as to the
alleged lack of notice of coverage to respondents as landowners and
their deprivation of just compensation. Let it be stressed that while
these issues were discussed by the PARAD in his decision, the latter
was precisely bereft of any jurisdiction to rule particularly in the
absence of any notice of coverage for being an ALI case.20 Let it also
be stressed that these issues were not met head-on by petitioners. At
this juncture, the issues should not be left hanging at the expense and
to the prejudice of respondents.
seek recourse from the Office of the Department of Agrarian Reform

Secretary. No costs.
SO ORDERED.
However, this Court refuses to rule on the validity of the CARP

coverage of the subject properties and the issuance of the assailed
CLOAs. The doctrine of primary jurisdiction precludes the courts
from resolving a controversy over which jurisdiction was initially
lodged with an administrative body of special competence.21 The
doctrine of primary jurisdiction does not allow a court to arrogate
unto itself authority to resolve a controversy, the jurisdiction over
which is initially lodged with an administrative body of special
competence.22 The Office of the DAR Secretary is in a better position
to resolve the particular issue of non-issuance of a notice of coverage
an ALI case being primarily the agency possessing the necessary
expertise on the matter.23 The power to determine such issue lies with
the DAR, not with this Court.
A final note.
It must be borne in mind that this Court is not merely a Court of law
but of equity as well.1avvphil Justice dictates that the DAR Secretary
must determine with deliberate dispatch whether indeed no notice of
coverage was furnished to respondents and payment of just
compensation was unduly withheld from them despite the fact that
the assailed CLOAs were already registered, on the premise that
respondents were unaware of the CARP coverage of their properties;
hence, their right to protest the same under the law was defeated.
Respondents right to due process must be equally respected. Apropos
is our ruling in Heir of Nicolas Jugalbot v. Court of Appeals:24
[I]t may not be amiss to stress that laws which have for their object
the preservation and maintenance of social justice are not only meant
to favor the poor and underprivileged. They apply with equal force to
those who, notwithstanding their more comfortable position in life,
are equally deserving of protection from the courts. Social justice is
not a license to trample on the rights of the rich in the guise of
defending the poor, where no act of injustice or abuse is being
committed against them.
As the court of last resort, our bounden duty to protect the less
privileged should not be carried out to such an extent as to deny
justice to landowners whenever truth and justice happen to be on their
side. For in the eyes of the Constitution and the statutes, EQUAL
JUSTICE UNDER THE LAW remains the bedrock principle by
which our Republic abides.
WHEREFORE, the instant petition is GRANTED. The assailed
Decision dated May 31, 2007 and Amended Decision (Partial) dated
September 25, 2007 of the Court of Appeals in CA-G.R. SP No.
97768 are herebyREVERSED and SET ASIDE. The case is
DISMISSED for lack of jurisdiction of the Department of Agrarian
Reform Adjudication Board. This decision is without prejudice to the
rights of respondents Johanna L. Romualdez, Dietmar L. Romualdez,
Jacqueline L. Romualdez, and Spouses Daniel and Ana Romualdez to
G.R. No. 174674
October 20, 2010
NESTLE PHILIPPINES, INC. and NESTLE WATERS

PHILIPPINES, INC. (formerly HIDDEN SPRINGS &
PERRIER, INC.), Petitioners,
vs.
UNIWIDE SALES, INC., UNIWIDE HOLDINGS, INC., NAIC
RESOURCES AND DEVELOPMENT CORPORATION,
UNIWIDE SALES REALTY AND RESOURCES CLUB, INC.,
FIRST PARAGON CORPORATION, and UNIWIDE SALES
WAREHOUSE CLUB, INC., Respondents.
On 11 October 2001, the Interim Receivership Committee filed in the

SEC a Second Amendment to the Rehabilitation Plan (SARP) in view
of Casino Guichard Perrachon's withdrawal. In its Order dated 23
December 2002, the SEC approved the SARP.
Petitioners, as unsecured creditors of respondents, appealed to the
SEC praying that the 23 December 2002 Order approving the SARP
be set aside and a new one be issued directing the Interim
Receivership Committee, in consultation with all the unsecured
creditors, to improve the terms and conditions of the SARP.
The Ruling of the SEC
RESOLUTION
In its 13 January 2004 Order, the SEC denied petitioners' appeal for
lack of merit. Petitioners then filed in the Court of Appeals a petition
for review of the 13 January 2004 Order of the SEC.
CARPIO, J.:
The Case
The Ruling of the Court of Appeals

1
This is a petition for review of the 10 January 2006 Decision and the
13 September 2006 Resolution3 of the Court of Appeals in CA-G.R.
SP No. 82184. The 10 January 2006 Decision denied for lack of merit
the petition for review filed by petitioners. The 13 September 2006
Resolution denied petitioners' motion for reconsideration and referred
to the Securities and Exchange Commission petitioners' supplemental
motion for reconsideration.
The Facts
The petitioners in this case are Nestle Philippines, Inc. and Nestle
Waters Philippines, Inc., formerly Hidden Springs & Perrier Inc. The
respondents are Uniwide Sales, Inc., Uniwide Holdings, Inc., Naic
Resources and Development Corporation, Uniwide Sales Realty and
Resources Club, Inc., First Paragon Corporation, and Uniwide Sales
Warehouse Club, Inc.
In its assailed 10 January 2006 Decision, the Court of Appeals denied

for lack of merit the petition for review filed by petitioners, thus:
In reviewing administrative decisions, the findings of fact made
therein must be respected as long as they are supported by substantial
evidence, even if not overwhelming or preponderant; that it is not for
the reviewing court to weigh the conflicting evidence, determine the
credibility of the witnesses, or otherwise substitute its own judgment
for that of the administrative agency on the sufficiency of the
evidence; that the administrative decision in matters within the
executive jurisdiction can only be set aside on proof of grave abuse of
discretion, fraud, or error of law.
WHEREFORE, the petition for review is DENIED for lack of merit.
SO ORDERED.5
On 25 June 1999, respondents filed in the Securities and Exchange

Commission (SEC) a petition for declaration of suspension of
payment, formation and appointment of rehabilitation receiver, and
approval of rehabilitation plan. The petition was docketed as SEC
Case No. 06-99-6340.4 The SEC approved the petition on 29 June
1999.
On 18 October 1999, the newly appointed Interim Receivership
Committee filed a rehabilitation plan in the SEC. The plan was
anchored on return to core business of retailing; debt reduction via
cash settlement and dacion en pago; loan restructuring; waiver of
penalties and charges; freezing of interest payments; and restructuring
of credit of suppliers, contractors, and private lenders.
On 14 February 2000, the Interim Receivership Committee filed in
the SEC an Amended Rehabilitation Plan (ARP). The ARP took into
account the planned entry of Casino Guichard Perrachon, envisioned
to infuse P3.57 billion in fresh capital. On 11 April 2001, the SEC
approved the ARP.
Petitioners moved for reconsideration. They also filed a supplemental

motion for reconsideration alleging that they received a letter on 25
January 2006, from the president of the Uniwide Sales Group of
Companies, informing them of the decision to transfer, by way of full
concession, the operation of respondents' supermarkets to Suy Sing
Commercial Corporation starting 1 March 2006.
In its questioned 13 September 2006 Resolution, the Court of Appeals
denied for lack of merit petitioners' motion for reconsideration and
referred to the SEC petitioners' supplemental motion for
reconsideration.
Dissatisfied, petitioners filed in this Court on 3 November 2006 the
present petition for review.
The Issue
Before us, petitioners raise the issue of whether the SARP should be
revoked and the rehabilitation proceedings terminated.1avvphi1
The Court's Ruling

The petition lacks merit.
Petitioners contend that the transfer of respondents' supermarket
operations to Suy Sing Commercial Corporation has made the SARP
incapable of implementation. Petitioners point out that since the
SARP may no longer be implemented, the rehabilitation case should
be terminated pursuant to Section 4-26, Rule IV of the SEC Rules of
Procedure on Corporate Recovery. Petitioners claim that the terms
and conditions of the SARP are unreasonable, biased in favor of
respondents, prejudicial to the interests of petitioners, and incapable
of a determination of feasibility.
Respondents maintain that the SARP is feasible and that the SEC
Hearing Panel did not violate any rule or law in approving it.
Respondents stress that the lack of majority objection to the SARP
bolsters the SEC's findings that the SARP is feasible. Respondents
insist that the terms and conditions of the SARP are in accord with
the Constitution and the law.
The Court takes judicial notice of the fact that from the time of the
filing in this Court of the instant petition, supervening events have
unfolded substantially changing the factual backdrop of this
rehabilitation case.
Respondents moved for reconsideration of the 30 July 2009 and the

17 September 2009 Orders. The Hearing Panel, in its 6 November
2009 Order, denied the motion for reconsideration for being a
prohibited pleading.
Respondents then filed in the SEC a petition for certiorari assailing
the 30 July 2009, the 17 September 2009, and the 6 November 2009
Orders of the Hearing Panel. The petition was docketed as SEC En
Banc Case No. 12-09-183.
Meanwhile, in its 13 January 2010 Resolution, the Hearing Panel
disapproved the revised TARP and terminated the rehabilitation case
as a consequence. The dispositive portion of the Resolution reads:
WHEREFORE, premises considered:
1. Petitioners' Motion to Approve Revised Third Amendment
to the Group Rehabilitation Plan (Revised TARP) is
DENIED.
2. The motions to declare petitioners' rehabilitation plan "not
feasible" are GRANTED. Consequently, the instant
rehabilitation case is TERMINATED and the stay order is
lifted and dissolved. This case is deemed finally disposed of
pursuant to Section 5.2 of Republic Act No. 8799.9
As found by the SEC, several factors prevented the realization of the

desired goals of the SARP, to wit: (1) unexpected refusal of some
creditors to comply with all the terms of the SARP; (2) unexpected
closure of Uniwide EDSA due to the renovation of EDSA Central
Mall; (3) closure of Uniwide Cabuyao and Uniwide Baclaran; (4)
lack of supplier support for supermarket operations; and (5) increased
expenses.6
On 22 January 2010, respondents filed another petition appealing the

Hearing Panel's 13 January 2010 Resolution. The petition was
docketed as SEC En Banc Case No. 01-10-193. In order to preserve
the parties' rights during the pendency of the appeal, the SEC en
banc in its Order dated 18 March 2010 directed the parties to observe
the status quo prevailing before the issuance of the 13 January 2010
Resolution of the Hearing Panel.
On 11 July 2007, the rehabilitation receiver filed in the SEC a Third

Amendment to the Rehabilitation Plan (TARP). But before the SEC
could act on the TARP, the rehabilitation receiver filed on 29
September 2008 a Revised Third Amendment to the Rehabilitation
Plan (revised TARP).
Meanwhile, on 27 April 2010, the SEC en banc issued an Order

directing the rehabilitation receiver, Atty. Julio C. Elamparo, to
submit a comprehensive report on the progress of the implementation
of the SARP.
A majority of the secured creditors strongly opposed the revised

TARP, which focused on the immediate settlement of all the
obligations accruing to the unsecured creditors through a dacion of
part of respondents' Metro Mall property.7 Since some creditors
claimed that the value of the Metro Mall property had gone down
since 1999, the Hearing Panel issued its 30 July 2009 Order directing
the reappraisal of the Metro Mall property.8
In its 17 September 2009 Order, the Hearing Panel directed
respondents to show cause why the rehabilitation case should not be
terminated considering that the rehabilitation plan had undergone
several revisions. The Hearing Panel also directed the creditors to
manifest whether they still wanted the rehabilitation proceedings to
continue.
Finally, in its 30 September 2010 Order, the SEC consolidated

SEC En Banc Case No. 01-10-193 with SEC En Banc Case No. 1209-183, the parties being identical and the issues in both petitions
being in reference to the same rehabilitation case.
Considering the pendency of SEC En Banc Case No. 12-09-183 and
SEC En Banc Case No. 01-10-193, recently filed in the SEC,
involving the very same rehabilitation case subject of this petition, the
present petition has been rendered premature.
SEC En Banc Case No. 12-09-183 deals with the Order of the
Hearing Panel directing respondents to show cause why the
rehabilitation case should not be terminated and the creditors to
manifest whether they still want the rehabilitation proceedings to
continue. On the other hand, SEC En Banc Case No. 01-10-193 is an
appeal of the Hearing Panel's Resolution disapproving the revised
TARP and terminating the rehabilitation proceedings.
In light of supervening events that have emerged from the time the
SEC approved the SARP on 23 December 2002 and from the time the
present petition was filed on 3 November 2006, any determination by
this Court as to whether the SARP should be revoked and the
rehabilitation proceedings terminated, would be premature.
Undeniably, supervening events have substantially changed the
factual backdrop of this case. The Court thus defers to the
competence and expertise of the SEC to determine whether, given the
supervening events in this case, the SARP is no longer capable of
implementation and whether the rehabilitation case should be
terminated as a consequence.
Under the doctrine of primary administrative jurisdiction, courts will
not determine a controversy where the issues for resolution demand
the exercise of sound administrative discretion requiring the special
knowledge, experience, and services of the administrative tribunal to
determine technical and intricate matters of fact.10
In other words, if a case is such that its determination requires the
expertise, specialized training, and knowledge of an administrative
body, relief must first be obtained in an administrative proceeding
before resort to the court is had even if the matter may well be within
the latter's proper jurisdiction.11
The objective of the doctrine of primary jurisdiction is to guide the
court in determining whether it should refrain from exercising its
jurisdiction until after an administrative agency has determined some
question or some aspect of some question arising in the proceeding
before the court.12
It is not for this Court to intrude, at this stage of the rehabilitation
proceedings, into the primary administrative jurisdiction of the SEC
on a matter requiring its technical expertise. Pending a decision of the
SEC on SEC En Banc Case No. 12-09-183 and SEC En Banc Case
No. 01-10-193, which both seek to resolve the issue of whether the
rehabilitation proceedings in this case should be terminated, we are
constrained to dismiss this petition for prematurity.
WHEREFORE, we DISMISS the instant petition for having been
rendered premature pending a decision of the Securities and
Exchange Commission (SEC) in SEC En Banc Case No. 12-09-183
and SEC En Banc Case No. 01-10-193.
No pronouncement as to costs.
SO ORDERED.
G.R. No. 138381
April 16, 2002
GOVERNMENT SERVICE INSURANCE SYSTEM, petitioner,

vs.
COMMISSION ON AUDIT, respondent.
x---------------------------------------------------------x
G.R. No. 141625 April 16, 2002
GOVERNMENT SERVICE INSURANCE SYSTEM, petitioner,
vs.
ALFREDO D. PINEDA, DANIEL GO, FELINO BULANDUS,
FELICIMO J. FERRARIS, JR., BEN HUR PORLUCAS, LUIS
HIPONIA, MARIA LUISA A. FERNANDEZ, VICTORINA
JOVEN, CORAZON S. ALIWANAG, SILVER L. MARTINES,
SR., RENATO PEREZ, LOLITA CAYLAN, DOUGLAS
VALLEJO and LETICIA ALMAZAN, on their own behalf and
on behalf of all GSIS retirees with all of whom they share a
common and general interest, respondents.
No. 10 (CCC No. 10). The first paragraph of Section 12, R.A. No.
6758 reads:
SEC. 12. Consolidation of Allowances and Compensation.All allowances, except for representation and transportation
allowances; clothing and laundry allowances; subsistence
allowance of marine officers and crew on board government
vessels and hospital personnel; hazard pay; allowances of
foreign service personnel stationed abroad; and such other
additional compensation not otherwise specified herein as
may be determined by the DBM, shall be deemed included in
the standardized salary rates herein prescribed.Such other
additional compensation, whether in cash or in kind, being
received by incumbents only as of July 1, 1989, not
integrated into the standardized salary rates shall continue
to be authorized. x x x
Sub-paragraphs 5.4 and 5.5 of CCC No. 10,1 meanwhile,
supplemented Section 12 above by enumerating the additional
compensation authorized to be continued for incumbent employees as
of July 1, 1989.
YNARES-SANTIAGO, J.:
According to the Corporate Auditor, R.A. No. 6758 authorized the
At the core of these two consolidated petitions is the determination of continued grant of allowances/fringe benefits not integrated into the
standardized salary for incumbents as of June 30, 1989. However,
whether the Commission on Audit (COA) properly disallowed on
these non-integrated benefits may not be increased after effectivity of
post-audit, certain allowances and/or fringe benefits granted to
the statute, without prior approval of the DBM or Office of the
employees of the Government Service Insurance System (GSIS),
President or in the absence of legislative authorization in accordance
after the effectivity of Republic Act No. 6758, otherwise known as
with CCC No. 10. Explaining this position, the Corporate Auditor
the Salary Standardization Law on July 1, 1989.
invoked COA Memorandum No. 90-653 dated June 4, 1990, which
states:
I. G.R. No. 138381
In this special civil action for certiorari under Rule 65 in relation to
Rule 64 of the 1997 Rules of Civil Procedure, petitioner GSIS seeks
the annulment of COA Decision No. 98-337 dated August 25, 1998,
which affirmed the Resident Auditor's disallowance of monetary
benefits granted to or paid by GSIS in behalf of its employees.
After the effectivity of R.A. No. 6758 on July 1, 1989, petitioner
GSIS increased the following benefits of its personnel: a) longevity
pay; b) children's allowance; c) housing allowance for its branch and
assistant branch managers; and d) employer's share in the GSIS
Provident Fund from 20% to 45% of basic salary for incumbent
employees as of June 30, 1989.
x x x While it is true that R.A. 6758 and Corporate

Compensation Circular (CCC) No. 10 are silent with respect
to the increase of allowances/fringe benefits not integrated
into the basic salary and allowed to be continued only for
incumbents as of June 30, 1989, it would be inconsistent to
allow further increase in said allowances and fringe benefits
after July 1, 1989 since continuance thereof for incumbents
is merely being tolerated until they vacate their present
positions for which they have been authorized to receive
allowances/fringe benefits.2
The Corporate Auditor also did not allow in audit the remittance of
employer's share to the GSIS Provident Fund for new-hires because
The GSIS also remitted employer's share to the GSIS Provident Fund the continuation of said benefit was only in favor of incumbents, as
for new employees hired after June 30, 1989, continued the payment explicitly stated in the law. The payment of group insurance
premiums covering all employees was likewise disallowed, for the
of premiums for group personnel accident insurance
reason that under sub-paragraph 5.6 of CCC No. 10,3 all fringe
and granted loyalty cash award to its employees in addition to a
benefits granted on top of basic salary not otherwise enumerated
service cash award.
under sub-paragraphs 5.4 and 5.5 thereof were already discontinued
effective November 1, 1989. As for the loyalty cash award and the
Upon post-audit and examination, the GSIS Corporate Auditor
service cash award, the Corporate Auditor opined that only one of the
disallowed the aforementioned allowances and benefits, citing
Section 12 of R.A. No. 6758 in relation to sub-paragraphs 5.4 and 5.5 two monetary incentives may be availed of by GSIS personnel.
of its implementing rules, DBM Corporate Compensation Circular
On February 26, 1993, Mr. Julio Navarrete, Vice-President of the

GSIS Human Resources Group, wrote to respondent COA appealing,
in behalf of GSIS, the afore-stated disallowances by the Corporate
Auditor. Mr. Navarrete averred that although it may be conceded that
the Salary Standardization Law did not extend the subject benefits to
new-hires after the law's effectivity, the increase thereof should
nonetheless be allowed for incumbents since these benefits have been
enjoyed by said employees even prior to the passage of said law.4
In the case of Philippine Ports Authority v. Commission on
Audit,5 which involved a similar increase, after the enactment of R.A.
No. 6758, in the representation and transportation allowance (RATA)
of Philippine Ports Authority (PPA) employees, it was held that:
x x x the date July 1, 1989 does not serve as a cut-off date
with respect to the amount of RATA. The date July 1, 1989
becomes crucial only to determine that as of said date, the
officer was an incumbent and wasreceiving the RATA, for
purposes of entitling him to its continued grant. This given
date should not be interpreted as fixing the maximum
amount of RATA to be received by the official.6
It was further alleged that contrary to the Corporate Auditor's
contention, the GSIS Board of Trustees retained its power to fix and
determine the compensation package for GSIS employees despite the
passage of the Salary Standardization Law, pursuant to Section 36 of
Presidential Decree No. 1146, as amended by Presidential Decree No.
1981, to wit:
Sec. 36. x x x
The Board of Trustees has the following powers and
functions, among others:
xxx
xxx
xxx
(d) Upon the recommendation of the President and General

Manager, to approve the System's organizational and
administrative structure and staffing pattern, and "to
establish, fix, review, revise and adjust the appropriate
compensation package for the officers and employees of the
System, with reasonable allowances, incentives, bonuses,
privileges and other benefits as may be necessary or proper
for the effective management, operation and administration
of the System." For the purpose of this and the preceding
subsection, the System shall be exempt from the rules and
requirements of the Office of the Budget and Management
and the Office of the Compensation and Position
Classification;
xxx
xxx
xxx
Pursuant thereto, the GSIS Board of Trustees may validly increase

and grant the subject benefits, even without securing
the imprimatur of the DBM, Office of the President or Congress.
On August 25, 1998, the COA affirmed the disallowances made by

the Corporate Auditor and held that Section 36 of P.D. No. 1146, as
amended, was already repealed by Section 16 of R.A. No. 6758.7 The
COA similarly concluded that the GSIS Board of Trustees may not
unilaterally augment or grant benefits to its personnel, without the
necessary authorization required under CCC No. 10.8
GSIS filed a motion for reconsideration of the COA decision,
invoking the ruling in De Jesus, et al. v. COA and
Jamoralin.9 Corporate Compensation Circular No. 10 (CCC No. 10)
was declared to be of no legal force or effect due to its nonpublication in the Official Gazette or a newspaper of general
circulation. In view of this development, GSIS posited that the
questioned disallowances no longer had any leg to stand on and that
COA should consequently lift the disallowances premised on CCC
No. 10.
On March 23, 1999, the COA denied the motion for reconsideration
stating:
Although CCC No. 10 has been declared ineffective due to
its non-publication as provided for in Article 2 of the Civil
Code of the Philippines, the disallowances on the increased
rates of the allowances/fringe benefits can still be sustained
because as ruled earlier, the power of the governing boards
of corporations to fix compensation and allowances of
personnel, including the authority to increase the rates,
pursuant to their specific charters had already been repealed
by Sec. 3 of P.D. 1597 and Section 16 of R.A. 6758. The
other reasons or grounds relied upon by the petitioner upon
which the Motion is predicated have already been
judiciously passed upon by this Commission when it
rendered the subject COA Decision No. 98-337.
Accordingly, there being no new, sufficient and material
evidence adduced as would warrant a reversal or
modification of the decision herein sought to be
reconsidered, this Commission denies with finality the
instant motion for reconsideration for utter lack of merit.10
Hence, this petition, challenging the above decision and resolution of
the COA on the following grounds:
A.)RESPONDENT COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION IN HOLDING THAT THE POWER
SPECIFICALLY GRANTED BY PRESIDENTIAL
DECREE NO. 1146, AS AMENDED, TO THE GSIS
BOARD OF TRUSTEES, TO ESTABLISH AND FIX THE
APPROPRIATE COMPENSATION PACKAGE FOR GSIS
OFFICERS AND EMPLOYEES HAS ALREADY BEEN
REPEALED BY REPUBLIC ACT NO. 6758.
B.)RESPONDENT COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION IN DENYING PETITONER'S MOTION
FOR RECONSIDERATION DESPITE THE

DECLARATION BY THIS HONORABLE COURT IN
THE CASE OF RODOLFO S. DE JESUS et al. vs.
COMMISSION ON AUDIT and LEONARDO L.
JAMORALIN, THAT CCC NO. 10 - THE MAIN BASIS OF
THE QUESTIONED DISALLOWANCE - IS INVALID
AND INEFFECTIVE FOR LACK OF THE REQUIRED
PUBLICATION.11
benefits, on the premise that the same are monetary liabilities of the
retirees in favor of GSIS under Section 39 above. GSIS also insisted
that since the deductions were anchored on the disallowances made
by the COA, the retirees' remedy was to ventilate the issue before
said Commission and not the GSIS Board.
Meanwhile, the De Jesus case mentioned in G.R. No. 138381 was

promulgated, rendering CCC No. 10 legally ineffective. This
prompted the hearing officer to suggest that the parties enter into an
II. G.R. No. 141625
agreement as to what allowances and benefits are covered by CCC
No. 10, so that a partial decision can be rendered thereon. The retirees
thus filed a motion for partial decision, submitting that there no
This petition for review on certiorari under Rule 45 of the Rules of
longer existed any obstacle to the increase in allowances and benefits
Court was precipitated by the factual antecedents of G.R. No.
covered by CCC No. 10. These allegedly include: a) GSIS
138381. While GSIS was appealing the disallowances made by the
management's share in the Provident Fund; b) initial payment of the
Corporate Auditor above, some of its employees retired and
productivity bonus; c) acceleration implementation of the new salary
submitted the requisite papers for the processing of their retirement
schedule effective August 1, 1995; d) increase in clothing allowance,
benefits. Since the retired employees received allowances and
rice allowance, meal subsidy, children's allowance and longevity pay;
benefits which had been disallowed by the Corporate Auditor, GSIS
required them to execute deeds of consent that would authorize GSIS e) loyalty award; f) 1995 mid-year financial assistance; and g) other
allowances as may be suggested by the Vice-President of the GSIS
to deduct from their retirement benefits the previously paid
allowances, in case these were finally adjudged to be improper. Some Human Resources Group.13
of the retired employees agreed to sign the deed, while others did not.
Nonetheless, GSIS went ahead with the deductions.
On November 25, 1998, GSIS filed an opposition to the retiree's
motion for partial decision,14 asserting that De Jesus had no bearing
on the principal issue which, as agreed upon, was the interpretation of
On April 16, 1998, a number of these retired GSIS
Section 39 of RA No. 8291. GSIS also filed on even date, a motion to
employees12 (hereafter referred to as "retirees") brought Case No.
dismiss,15 alleging that the nullity of CCC No. 10 rendered the
001-98 before the GSIS Board of Trustees (hereafter referred to as
petition moot and academic and paved the way for the payment of the
"GSIS Board") questioning the legality of the deductions. They
claimed that COA disallowances can not be deducted from retirement controverted allowances earlier deducted from the retirement
benefits.
benefits, considering that these were explicitly exempted from such
deductions under the last paragraph of Section 39, Republic Act No.
8291, which states:
Replying to the two pleadings filed by GSIS, the retirees countered
that a motion to dismiss was a prohibited pleading under Section
SEC. 39. Exemption from Tax, Legal Process and Lien. - x x 14.13, Rule XIV of the GSIS Implementing Rules and
Regulations.16 Moreover, the retirees maintained that a motion to
x
dismiss may be filed in proceedings before the GSIS Board only prior
to the filing of an answer which GSIS had already done. Also, the
xxx
xxx
xxx
LSG had previously agreed to a partial decision based on the De
The funds and/or the properties referred to herein as well as Jesus case; it could thus no longer take a contradictory stand by
opposing the retiree's motion for partial decision.17
the benefits, sums or monies corresponding to the benefits
under this Act shall be exempt from attachment,
garnishment, execution, levy or other processes issued by
the courts, quasi-judicial agencies or administrative bodies
including Commission on Audit (COA) disallowances and
from all financial obligations of the members, including his
pecuniary accountability arising from or caused or
occasioned by his exercise or performance of his official
functions or duties, or incurred relative to or in connection
with his position or work except when his monetary liability,
contractual or otherwise, is in favor of the GSIS.
The GSIS Board subsequently referred the case for hearing to its
Corporate Secretary, Atty. Alicia Albert. Thereafter, the retirees and
GSIS, through its Legal Services Group (LSG), entered into a
stipulation of facts and agreed on a focal issue, namely: whether the
COA disallowances may be legally deducted from the retirement
On January 14, 1999, the retirees filed a motion for summary

judgment18 claiming that there were no factual issues involved and
that the question raised in the petition was purely legal in nature. The
matter was directly submitted to the GSIS Board for its consideration
and resolution.
On March 3, 1999, the GSIS Board issued Resolution No.
72,19 dismissing the petition. A motion for reconsideration filed by the
retirees was also denied by the Board in its Resolution No.
16120 dated May 18, 1999.
The matter was then elevated to the Court of Appeals, which rendered
a decision on September 30, 1999, disposing as follows:
10
IN THE LIGHT OF ALL THE FOREGOING, the Petition is

GRANTED. Resolution No. 72, Annex "A" of the Petition
and Resolution No. 161 Annex "C" of the Petition are hereby
SET ASIDE and NULLIFIED. The Hearing Officer of the
Board of Trustees of the Respondent is directed to proceed,
with dispatch, with the proceedings of Case No. 001-98, as
provided for in the Rules and regulations implementing
Republic Act 8291 (IRR).
SO ORDERED.21
The appellate court held that the motion to dismiss filed by the LSG
before the GSIS Board is a prohibited pleading under applicable
GSIS rules. The GSIS also had jurisdiction over the retirees' petition,
as it pertained to the interpretation and application of Section 39 of
R.A. No. 8291, a law exclusively administered by the GSIS Board.
Contrary to the LSG's submissions, the Court of Appeals ruled that
there was no identity in subject matter between the retiree's petition
and the appeal from the auditor's disallowances filed by GSIS with
the COA. Thus, the GSIS Board may take cognizance of the retirees'
petition independently from the COA proceedings.
Hence, this second petition, assigning the following as errors:
I
THE COURT OF APPEALS ERRED IN RULING THAT THE
BOARD OF TRUSTEES OF GSIS HAS JURISDICTION OVER
THE CASE.
II
THE COURT OF APPEALS ERRED IN RULING THAT THE
CASE PENDING BEFORE THE SUPREME COURT IS
DIFFERENT FROM THE PRESENT CASE.22
On August 20, 2001, the two petitions were consolidated.
During the pendency of these petitions, GSIS Board Resolution No.
79,23 which authorized the Provident Fund rate increase for incumbent
employees, was approved retroactively from March 1, 1994 by then
President Joseph Estrada.24 Thus, there no longer appears to be any
basis for disallowing the rate increase in management contribution to
the Provident Fund from 20% to 45% of the basic salary received by
petitioner's incumbent employees. The presidential approval cured the
lack of authorization cited by respondent COA for disallowing this
particular increase in benefit.
We now proceed to the resolution of the twin petitions.
Petitioner GSIS insists that the GSIS Board retained its power to
increase the subject benefits under Section 36 of P.D. 1146, as
amended (or the Revised GSIS Charter), despite the passage of R.A.
No. 6758, particularly Section 16 thereof. The latter, which is a
general law, can not repeal or take precedence over the former
because the Revised GSIS Charter is a special law that specifically
exempts GSIS from Office of the Compensation and Position

Classification coverage.
We need not delve lengthily into this submission as this was earlier
laid to rest by the Court in Philippine International Trading
Corporation (PITC) v. COA,25 where we held that "the repeal by
Section 16 of RA 6758 of 'all corporate charters that exempt agencies
from the coverage of the system' was clear and expressed necessarily
to achieve the purposes for which the law was enacted, that is, the
standardization of salaries of all employees in government owned
and/or controlled corporations to achieve 'equal pay for substantially
equal work'."26 As things now stand, GSIS is already exempt from
salary standardization by express provision of R.A. 829127 a
subsequent enactment approved on May 30, 1997 which amended the
Revised GSIS Charter. But since GSIS was still governed by the latter
at the time the increase in benefits were disallowed in audit, GSIS
was then yet covered by the Salary Standardization Law, thereby
making our ruling in PITC presently relevant and applicable.
We now come to the legal propriety of the COA disallowances.
For purposes of clarity, a distinction must initially be made between
those allowances which are deemed consolidated into the
standardized salary and those which are not under the terms of R.A.
No. 6758. As correctly pointed out by petitioner GSIS, the housing
allowance, longevity pay and children's allowance are nonintegratedbenefits, expressly made so by sub-paragraphs 5.4 and 5.5
of CCC No. 10 in relation to the last sentence of Section 12 (par. 1),
R.A. No. 6758. On the other hand, the payment of group personnel
accident insurance premiums, loyalty cash award and service cash
award are not excluded from the standardized salary by the same
provisions of CCC No. 10 or R.A. No. 6758. These latter allowances
are thus considered integrated into the basic salary and are treated
differently under the same law.
A. NON-INTEGRATED BENEFITS AND ALLOWANCES
a. Longevity Pay and Children's Allowance
As regards the increase in longevity pay and children's allowance, we
find applicable our pronouncement inPhilippine Ports
Authority (PPA) v. COA.28 This case involved an adjustment in the
representation and transportation allowance (RATA) of incumbent
PPA employees after the effectivity of R.A. No. 6758 on July 1, 1989.
The RATA therein is similar to the longevity pay and children's
allowance subject of the instant petition, in the sense that: a) it is also
a non-integrated allowance authorized to be continued for incumbents
under Section 12, R.A. No. 6758; and b) the rate thereof did not
consist of a definite amount but was subject to certain factors and/or
stipulations that were nonetheless fixed before R.A. 6758 took effect.
In the PPA case, the adjustment was brought about by a
corresponding increase in the employees' basic salary upon which the
40% RATA was based. Respondent Commission disallowed the
payment of RATA differentials arguing, as in this petition, that the
RATA should be fixed at the prevailing rate prior to July 1, 1989,
11
regardless of the increase in basic salary. It was postulated therein

that consistent with the second sentence of said Section 12 (par. 1),
the RATA should no longer be based on 40% of basic standardized
salary but on the highest amount of RATA received by the incumbent
as of July 1, 1989.
P3,000.00 by virtue of GSIS Board Resolution No. 29431 dated July

26, 1991.
Thus, to peg the amount of these non-integrated allowances at the

figure being received by the incumbent as of July 1, 1989 would vary
the terms of the benefits to which the incumbents are entitled. This
could not have been the intendment of the statute, because such
interpretation would effectively impair the incumbents' rights to these
allowances, which have already accrued prior to July 1, 1989. In
other words, before R.A. No. 6758 was enacted, incumbent GSIS
employees had a fixed right to these allowances under the terms and
conditions then obtaining.30They could not therefore be excluded
from its enjoyment under the same terms and conditions without
violating basic precepts of fairness and due process.
As stated earlier, the payment of premiums for group personnel

accident insurance in favor of incumbent GSIS employees was not
listed as an exception to the standardized salary under Section 12,
R.A. No. 6758 and sub-paragraphs 5.4 and 5.5 of CCC No. 10. As
such, it is considered as a fringe benefit granted on top of basic salary
which, according to sub-paragraph 5.6 of CCC No. 10, must be
discontinued as of November 1, 1989.
As stated earlier, the power of the GSIS Board to "establish, fix,

review, revise and adjust" the allowances, privileges and other
benefits of its employees under Section 36 of the Revised GSIS
We rejected respondent COA's interpretation of Section 12 and held
Charter has been repealed by R.A. No. 6758.32 As a consequence, the
that the date July 1, 1989 should not be construed as a cut-off date for GSIS Board may no longer grant any increase in housing allowance
setting the amount of allowances authorized to be continued under
on its own volition after June 30, 1989.
said provision. The date July 1, 1989 is important only for
determining whether an employee is an incumbent and receiving the Further, unlike the two preceding non-integrated benefits, it cannot be
allowance prior to the law's effectivity in order to ascertain if such
said that the affected branch and assistant branch managers acquired a
employee is qualified to its continued grant. It is not, however, to be
vested right to any amount of housing allowance in excess of that
interpreted as fixing the maximum amount of allowance that an
granted to them before the passage of R.A. No. 6758. They could not
incumbent employee is authorized to receive, but is only a qualifying have been entitled to any amount other than that which was already
date imposed by the statute.
determined before the law took effect, because the terms of this
allowance did not admit of any adjustment. Otherwise stated, since
Accordingly, the specific amount of longevity pay and children's
the amount of said housing allowance was fixed, the disallowance by
allowance being received by an incumbent GSIS employee as of July the COA of increases therein would not result in any diminution of
1, 1989 is not to be considered as the highest amount authorized
benefits for these incumbent managers. Neither can the GSIS Board
under the law.
unilaterally grant said increases by board resolution because it no
longer had any power to do so when it issued Resolution No. 294.
It is thus evident that in adjusting the amount of allowances
mentioned above, petitioner GSIS was merely complying with the
It appears that respondent COA did not totally disallow the increase
policy of non-diminution of pay and benefits enunciated in R.A. No. in housing allowance, but merely approved a lesser amount.
6758.29 This policy does not only pertain specifically to the amount
Respondent COA allowed a 100% increase of P1,000.00 and P600.00
being received by the incumbent as of July 1, 1989, but also to the
respectively, in accordance with the amount authorized by the
terms and conditions attached to these benefits prior to the passage of DBM.33 In fact, the DBM permitted the increase in express
the statute. Relative to this, it should be noted that respondent COA
recognition of the fact that this has been the practice in GSIS before
did not dispute the fact that these benefits, including the terms and
the advent of R.A. No. 6758. Consequently, it is only to the extent of
conditions thereof, are part of a compensation package granted by the the approved amount that the housing allowance should be allowed in
GSIS Board to incumbents even before R.A. 6758 took effect. In turn, audit.
this compensation package was incorporated in the 1978 GSIS
Revised Compensation System approved by the President, upon
B. INTEGRATED BENEFITS AND ALLOWANCES
recommendation of the Department of Budget and Management
(DBM).
a. Group Personnel Accident Insurance Premiums
b. Housing Allowance
In contrast to the two preceding non-integrated benefits, it appears
that the housing allowance given to petitioner's incumbent branch and
assistant branch managers before the passage of R.A. No. 6758
consisted of a fixed amount of P500.00 and P300.00 respectively.
Said amounts were subsequently increased to P2,000.00 and
However, as pointed out by petitioner GSIS, CCC No. 10 was

declared to be of no legal force and effect in De Jesus v. COA.34 It can
not thus be utilized as a justification for depriving incumbent
employees of integrated benefits which they were receiving prior to
R.A. No. 6758. As held in De Jesus:
x x x it is decisively clear that DBM CCC No. 10, which
completely disallows payment of allowances and other
additional compensation to government officials and
employees, starting November 1, 1989, is not a mere
interpretative and internal regulation. It is something more
12
than that. And why not, when it tends to deprive government

workers of their allowances and additional compensation
sorely needed to keep body and soul together. At the very
least, before said circular under attack may be permitted to
substantially reduce their income, the government officials
and employees concerned should be apprised and alerted by
the publication of subject circular in the Official Gazette or
in a newspaper of general circulation in the Philippines-to
the end that they may be given amplest opportunity to voice
out whatever opposition they may have, and to ventilate
their stance on the matter. This approach is more in keeping
with democratic precepts and rudiments of fairness and
transparency.35
Conformably, since the disallowance of the premium payments was
founded upon CCC No. 10, the consequent outcome of the latter's
nullification is to remove any obstacle to the aforesaid benefit.
The subsequent publication of CCC No. 10 in the Official Gazette on
March 1, 1999,36 neither cured the defect nor retroact to the time that
the aforesaid items were disallowed in audit. Again, in PITC v.
COA,37 we ruled that from the time the COA disallowed the benefit
up to the filing of the instant petition, CCC No. 10 remained in legal
limbo due to its lack of publication. And because publication is
a condition precedent to the effectivity of CCC No. 10, it must first be
complied with before affecting individual rights; otherwise, "such
omission would offend due process insofar as it would deny the
public, knowledge of the laws that are supposed to govern it."38
b. Loyalty and Service Cash Award
We have carefully examined the records of the case and find that the
disallowance of the simultaneous grant of these two integrated
benefits was not so much founded on CCC No. 10, but upon a ruling
made by the Civil Service Commission (CSC). Notably, with respect
to the loyalty and service cash award, respondent COA held:
P500.00 to P15,000.00 according to the number of years of

service, pursuant to the provisions of the Collective
Bargaining Agreement (CBA), which payments are deducted
by this Office from payment of Loyalty (Cash) Award. On
the other hand, this should not be confused with the amount
of Loyalty (Cash) Award in graduated amounts of P1,200.00,
P1,300.00, P1,400.00 and P1,500.00 for every year of
service of GSIS executives and employees who have
completed at least ten (10) years of continuous service as
authorized under Board Resolution No. 333 dated October
29, 1992 (Annex 7), using as legal basis Section 7 (e), Rule
X of the Omnibus Civil Service Law and Rules,
Implementing Book V of Executive Order No. 292,
providing for the cash bonus of not less than One Hundred
Pesos (P100.00) per year of service, chargeable against
Agency's savings. It seems that the foregoing provision
allows for a minimum but not for a maximum amount to be
given, thereby giving the agencies enough flexibility to fix
their own maximum amounts depending on the agency's
savings.
It is worthy to note in this connection that when the Civil
Service Commission issued Memorandum Circular No. 42,
series 1992, amending Section 7 (e), Rule X of the Omnibus
Civil Service Law and Rules, providing that the amount of
cash bonus to be given should not be more than P100.00 per
year of service, the GSIS returned to the old computation as
authorized under Board Resolutions No. 192 and 187 dated
May 16, 1989 and May 29, 1992 respectively (Annexes 8
and 9). Hence, the matter was referred to the Civil Service
Commission for clarification. The Commission ruled in a
letter dated May 12, 1993 (Annex 10) addressed to PGM
Cesar N. Sarino, that the availment of the award can be
made only under either system, whichever is more
advantageous to the employees.
Petitioner GSIS did not squarely address the above finding of

respondent COA or the Corporate Auditor. Instead, it based its
As regards the payment of loyalty cash award under Sec. 7
(e), Rule X, of the CSC Omnibus rules Implementing Book arguments on the general assumption that all the benefits and
V of E.O. No. 292 and service cash award, this Commission allowances subject of this petition were disallowed on the basis of
holds that only one can be availed of by GSIS employees in Section 12, R.A. No. 6758 and its implementing rules. This is beside
the light of the clear ruling of the Civil Service Commission the point, however, as it can readily be seen that respondent COA's
ruling on the loyalty and service cash award is actually based on a
embodied in a letter dated May 12, 1993 that since both
benefits have the same rationale, which is to reward long and purported CSC declaration relative thereto. As a result, there has been
dedicated service, "availment of the award can be made only no real joinder of issues as far as these benefits are concerned.
under either system, whichever is more advantageous to the
Coming now to G.R. No. 141625, the Court of Appeals did not
employees."39
commit any reversible error when it held that the petition filed before
The foregoing conclusion was apparently based on the position taken the GSIS Board questioning the legality of the deductions could
proceed independently from the appeal brought by petitioner GSIS
by Corporate Auditor Fe R. Munoz, who expounded thereon in a
from the COA disallowances. No error could be attributed to the
second indorsement40 dated December 14, 1993 as follows:
appellate court's finding that there was no identity of subject matter or
issue between the COA proceedings and the retirees' claim before the
Service Cash Award is an incentive granted exclusively to
GSIS Board.
any officer or employee of the GSIS who has rendered at
least fifteen (15) years continuous and dedicated service to
the GSIS. It entitles them to receive amounts ranging from
13
However, considering that it has already been resolved in G.R. No.

138381, we no longer find it necessary to discuss whether GSIS can
deduct the COA disallowances from the respondents/retirees'
retirement benefits. Having settled G. R. No. 138381, it is now
incumbent upon petitioner GSIS to reimburse the proper amounts to
respondents/retirees. Necessarily, the amount of said refund should be
in accord with our ruling in G.R. No. 138381.
WHEREFORE, in view of the foregoing, G.R. No. 138381 is
PARTLY GRANTED. The disallowance of the adjustment in
longevity pay and children's allowance and the payment of group
personnel accident insurance premiums in favor of incumbent GSIS
employees is SET ASIDE. The disallowance of the increase in
housing allowance and the simultaneous grant of loyalty and service
cash award are AFFIRMED. Petitioner GSIS is further ordered to
REFUND the amounts deducted from the retirement benefits in G.R.
No. 141625, corresponding to the amount of benefits allowed in G.R.
No. 138381.
SO ORDERED.
14
G.R. No. 180388
January 18, 2011
GREGORIO R. VIGILAR, SECRETARY OF THE

DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS
(DPWH), DPWH UNDERSECRETARIES TEODORO E.
ENCARNACION AND EDMUNDO E. ENCARNACION AND
EDMUNDO V. MIR, DPWH ASSISTANT SECRETARY JOEL
L. ALTEA, DPWH REGIONAL DIRECTOR VICENTE B.
LOPEZ, DPWH DISTRICT ENGINEER ANGELITO M.
TWAO, FELIX A. DESIERTO OF THE TECHNICAL
WORKING GROUP VALIDATION AND AUDITING TEAM,
AND LEONARDO ALVARO, ROMEO N. SUPAN, VICTORINO
C. SANTOS OF THE DPWH PAMPANGA 2ND ENGINEERING
DISTRICT, Petitioners,
vs.
ARNULFO D. AQUINO, Respondent.
DECISION
SERENO, J.:
was void for violating Presidential Decree No. 1445, absent the
proper appropriation and the Certificate of Availability of Funds. 5
On 28 November 2003, the lower court ruled in favor of respondent,
to wit:
WHEREFORE, premises considered, defendant Department of
Public Works and Highways is hereby ordered to pay the plaintiff
Arnulfo D. Aquino the following:
1. PhP1,873,790.69, Philippine Currency, representing actual
amount for the completion of the project done by the
plaintiff;
2. PhP50,000.00 as attorneys fee and
3. Cost of this suit.
SO ORDERED. 6
It is to be noted that respondent was only asking for

Before the Court is a Petition for Review on Certiorari1 under Rule 45 PhP1,262,696.20; the award in paragraph 1 above, however,
of the Rules of Court, assailing the Decision2 of the Court of Appeals conforms to the entire contract amount.
in C.A.-G.R. CV No. 82268, dated 25 September 2006.
The antecedent facts are as follows:
On appeal, the Court of Appeals reversed and set aside the Decision
of the lower court and disposed as follows:
On 19 June 1992, petitioner Angelito M. Twao, then Officer-inCharge (OIC)-District Engineer of the Department of Public Works
and Highways (DPWH) 2nd Engineering District of Pampanga sent
an Invitation to Bid to respondent Arnulfo D. Aquino, the owner of
A.D. Aquino Construction and Supplies. The bidding was for the
construction of a dike by bulldozing a part of the Porac River at
Barangay Ascomo-Pulungmasle, Guagua, Pampanga.
WHEREFORE, premises considered, the appeal is GRANTED. The

"CONTRACT AGREEMENT" entered into between the plaintiffappellees construction company, which he represented, and the
government, through the Department of Public Works and Highway
(DPWH) Pampanga 2nd Engineering District, is declared null and
void ab initio.
The assailed decision of the court a quo is hereby REVERSED AND

Subsequently, on 7 July 1992, the project was awarded to respondent, SET ASIDE.
and a "Contract of Agreement" was thereafter executed between him
and concerned petitioners for the amount of PhP1,873,790.69, to
In line with the pronouncement in Department of Health vs. C.V.
cover the project cost.
Canchela & Associates, Architects,7 the Commission on Audit
(COA) is hereby ordered to determine and ascertain with dispatch, on
By 9 July 1992, the project was duly completed by respondent, who
a quantum meruit basis, the total obligation due to the plaintiffwas then issued a Certificate of Project Completion dated 16 July
appellee for his undertaking in implementing the subject contract of
1992. The certificate was signed by Romeo M. Yumul, the Project
public works, and to allow payment thereof, subject to COA Rules
Engineer; as well as petitioner Romeo N. Supan, Chief of the
and Regulations, upon the completion of the said determination.
Construction Section, and by petitioner Twao.
No pronouncement as to costs.
Respondent Aquino, however, claimed that PhP1,262,696.20 was still
due him, but petitioners refused to pay the amount. He thus filed a
SO ORDERED.8
Complaint3 for the collection of sum of money with damages before
the Regional Trial Court of Guagua, Pampanga. The complaint was
Dissatisfied with the Decision of the Court of Appeals, petitioners are
docketed as Civil Case No. 3137.
now before this Court, seeking a reversal of the appellate courts
Decision and a dismissal of the Complaint in Civil Case No. G-3137.
Petitioners, for their part, set up the defense4 that the Complaint was a The Petition raises the following issues:
suit against the state; that respondent failed to exhaust administrative
remedies; and that the "Contract of Agreement" covering the project
15
1. WHETHER OR NOT THE COURT OF APPEALS ERRED IN

administrative authorities. The final decision on the matter rests not
HOLDING THAT THE DOCTRINE OF NON-SUABILITY OF THE with them but with the courts of justice. Exhaustion of administrative
STATE HAS NO APPLICATION IN THIS CASE.
remedies does not apply, because nothing of an administrative nature
is to be or can be done. The issue does not require technical
knowledge and experience but one that would involve the
interpretation and application of law. (Emphasis supplied.)
NOT DISMISSING THE COMPLAINT FOR FAILURE OF
RESPONDENT TO EXHAUST ALL ADMINISTRATIVE
REMEDIES.
Secondly, in ordering the payment of the obligation due respondent
on a quantum meruit basis, the Court of Appeals correctly relied on
Royal Trust Corporation v. COA,10 Eslao v. COA,11 Melchor v.
COA,12 EPG Construction Company v. Vigilar,13 and Department of
ORDERING THE COA TO ALLOW PAYMENT TO
RESPONDENT ON A QUANTUM MERUIT BASIS DESPITE THE Health v. C.V. Canchela & Associates, Architects.14 All these cases
LATTERS FAILURE TO COMPLY WITH THE REQUIREMENTS involved government projects undertaken in violation of the relevant
laws, rules and regulations covering public bidding, budget
OF PRESIDENTIAL DECREE NO. 1445.
appropriations, and release of funds for the projects. Consistently in
After a judicious review of the case, the Court finds the Petition to be these cases, this Court has held that the contracts were void for failing
to meet the requirements mandated by law; public interest and equity,
without merit.
however, dictate that the contractor should be compensated for
services rendered and work done.
Firstly, petitioners claim that the Complaint filed by respondent
before the Regional Trial Court was done without exhausting
administrative remedies. Petitioners aver that respondent should have
first filed a claim before the Commission on Audit (COA) before
going to the courts. However, it has been established that the doctrine
of exhaustion of administrative remedies and the doctrine of primary
jurisdiction are not ironclad rules. In Republic of the Philippines v.
Lacap,9 this Court enumerated the numerous exceptions to these
rules, namely: (a) where there is estoppel on the part of the party
invoking the doctrine; (b) where the challenged administrative act is
patently illegal, amounting to lack of jurisdiction; (c) where there is
unreasonable delay or official inaction that will irretrievably
prejudice the complainant; (d) where the amount involved is
relatively so small as to make the rule impractical and oppressive; (e)
where the question involved is purely legal and will ultimately have
to be decided by the courts of justice; (f) where judicial intervention
is urgent; (g) where the application of the doctrine may cause great
and irreparable damage; (h) where the controverted acts violate due
process; (i) where the issue of non-exhaustion of administrative
remedies has been rendered moot; (j) where there is no other plain,
speedy and adequate remedy; (k) where strong public interest is
involved; and (l) in quo warranto proceedings. In the present case,
conditions (c) and (e) are present.
The government project contracted out to respondent was completed
almost two decades ago. To delay the proceedings by remanding the
case to the relevant government office or agency will definitely
prejudice respondent. More importantly, the issues in the present case
involve the validity and the enforceability of the "Contract of
Agreement" entered into by the parties. These are questions purely of
law and clearly beyond the expertise of the Commission on Audit or
the DPWH. In Lacap, this Court said:
... It does not involve an examination of the probative value of the
evidence presented by the parties. There is a question of law when the
doubt or difference arises as to what the law is on a certain state of
facts, and not as to the truth or the falsehood of alleged facts. Said
question at best could be resolved only tentatively by the
Specifically, C.V. Canchela & Associates is similar to the case at bar,

in that the contracts involved in both cases failed to comply with the
relevant provisions of Presidential Decree No. 1445 and the Revised
Administrative Code of 1987. Nevertheless, "(t)he illegality of the
subject Agreements proceeds, it bears emphasis, from an express
declaration or prohibition by law, not from any intrinsic illegality. As
such, the Agreements are not illegal per se, and the party claiming
thereunder may recover what had been paid or delivered."15
The government project involved in this case, the construction of a
dike, was completed way back on 9 July 1992. For almost two
decades, the public and the government benefitted from the work
done by respondent. Thus, the Court of Appeals was correct in
applying Eslao to the present case. In Eslao, this Court stated:
...the Court finds that the contractor should be duly compensated for
services rendered, which were for the benefit of the general public. To
deny the payment to the contractor of the two buildings which are
almost fully completed and presently occupied by the university
would be to allow the government to unjustly enrich itself at the
expense of another. Justice and equity demand compensation on the
basis of quantum meruit. (Emphasis supplied.)
Neither can petitioners escape the obligation to compensate
respondent for services rendered and work done by invoking the
states immunity from suit. This Court has long established in
Ministerio v. CFI of Cebu,16 and recently reiterated in Heirs of
Pidacan v. ATO,17 that the doctrine of governmental immunity from
suit cannot serve as an instrument for perpetrating an injustice to a
citizen. As this Court enunciated in EPG Construction:181avvphi1
To our mind, it would be the apex of injustice and highly
inequitable to defeat respondents right to be duly compensated
for actual work performed and services rendered, where both the
government and the public have for years received and accepted
16
benefits from the project and reaped the fruits of respondents

honest toil and labor.
xxx
xxx
xxx
Under these circumstances, respondent may not validly invoke the

Royal Prerogative of Dishonesty and conveniently hide under the
State's cloak of invincibility against suit, considering that this
principle yields to certain settled exceptions. True enough, the rule,
in any case, is not absolute for it does not say that the state may
not be sued under any circumstance.
xxx
xxx
xxx
Although the Amigable and Ministerio cases generously tackled the

issue of the State's immunity from suit vis a vis the payment of just
compensation for expropriated property, this Court nonetheless finds
the doctrine enunciated in the aforementioned cases applicable to the
instant controversy, considering that the ends of justice would be
subverted if we were to uphold, in this particular instance, the
State's immunity from suit.
To be sure, this Court as the staunch guardian of the citizens'
rights and welfare cannot sanction an injustice so patent on its
face, and allow itself to be an instrument in the perpetration
thereof. Justice and equity sternly demand that the State's cloak
of invincibility against suit be shred in this particular instance,
and that petitioners-contractors be duly compensated on the
basis of quantum meruit for construction done on the public
works housing project. (Emphasis supplied.)
WHEREFORE, in view of the foregoing, the Petition
is DENIED for lack of merit. The assailed Decision of the Court of
Appeals in CA-G.R. No. 82268 dated 25 September 2006
is AFFIRMED.
SO ORDERED.
17
G.R. No. 167824
July 2, 2010
and 45-A of the Philippine Immigration Act of 1940, as amended,

which reads as follows:
GERALDINE GAW GUY and GRACE GUY CHEU, Petitioners,

vs.
ALVIN AGUSTIN T. IGNACIO, Respondent.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 168622
GERALDINE GAW GUY and GRACE GUY CHEU, Petitioners,
vs.
THE BOARD OF COMMISSIONERS OF THE BUREAU OF
IMMIGRATION, HON. MARICEL U. SALCEDO,
MAYNARDO MARINAS, RICARDO CABOCHAN and
ELISEO EXCONDE, Respondents.
The undersigned Special Prosecutor charges GRACE GUY CHEU

and GERALDINE GAW GUY, both Canadian citizens, for working
without permit, for fraudulently representing themselves as Philippine
citizens in order to evade immigration laws and for failure to comply
with the subpoena duces tecum/ad testificandum, in violation of the
Philippine Immigration Act of 1940, as amended, committed as
follows:
That respondents GRACE GUY CHEU and GERALDINE GAW
GUY, knowingly, willfully and unlawfully engage in gainful activities
in the Philippines without appropriate permit by working as the VicePresident for Finance & Treasurer and General Manager, respectively,
of Northern Islands Company, Inc., with office address at No. 3
Mercury Avenue, Libis, Quezon City;
DECISION
PERALTA, J.:
This is a petition for review on certiorari1 under Rule 45 of the 1997
Rules of Civil Procedure seeking, among others, to annul and set
aside the Decisions dated January 6, 20052 and April 20, 20053 and
Resolutions dated March 10, 20054 and June 29, 20055 rendered by
the Court of Appeals (CA), reversing and setting aside the Writ of
Preliminary Injunction issued by the Regional Trial Court6 (RTC),
Branch 37, Manila.
That both respondents, knowingly, willfully and fraudulently

misrepresent themselves as Philippine citizens as reflected in the
general Information Sheet of Northern Islands Company, Inc., for
2004, in order to evade any requirement of the Philippine
Immigration Laws;
That both respondents, duly served with subpoenas duces tecum/ad
testificandum, dated April 20, 2004, knowingly, willfully and
unlawfully failed to comply with requirements thereof.1avvphi1
CONTRARY TO LAW.
The antecedent facts follow.

The father of petitioners Geraldine Gaw Guy and Grace Guy Cheu
became a naturalized7 Filipino citizen sometime in 1959. The said
petitioners, being minors at that time, were also recognized8 as
Filipino citizens.
9
Respondent Atty. Alvin Agustin T. Ignacio, filed a Complaint dated

March 5, 2004 for blacklisting and deportation against petitioners
Geraldine and Grace before the Bureau of Immigration (BI) on the
basis that the latter two are Canadian citizens who are illegally
working in the Philippines, petitioners having been issued Canadian
passports.
Acting upon the Complaint, respondent Maricel U. Salcedo, Special
Prosecutor, Special Task Force of the BI Commissioner, directed the
petitioners, through the issuance of a subpoenae,10 to appear before
her and to bring pertinent documents relative to their current
immigration status, to which the petitioners objected by filing with
the Special Task Force of the BI Commissioner a
Comment/Opposition with Motion Ad Cautelam to Quash Re:
Subpoena11 dated 30 April 2004 (Duces Tecum/Ad Testificandum),
which was eventually denied by respondent Salcedo in an
Order12 dated May 14, 2004.
Respondent Board of Commissioners (BOC) filed a Charge
Sheet13 dated June 1, 2004 for Violation of Sections 37 (a) 7, 45 (e)
As a remedy, petitioners filed a Petition for Certiorari with Damages

and a Prayer for Issuance of a Temporary Restraining Order and
Preliminary Injunction14 dated May 31, 2004 before the RTC of
Manila, Branch 37.15
The trial court, after hearing petitioner's application for issuance of a
temporary restraining order (TRO) and writ of preliminary injunction,
issued an Order16 dated June 28, 2004, the dispositive portion of
which reads:
WHEREFORE, premises considered, the application for temporary
restraining order is hereby GRANTED. The respondents and all
persons acting in their behalf and those under their instructions are
directed to cease and desist from continuing with the deportation
proceedings involving the petitioners. In the meantime set the case for
hearing on preliminary injunction on July 5 and 6, 2004, both at 2:00
o'clock in the afternoon and the respondents are directed to show
cause why writ of preliminary injunction should not issue.
SO ORDERED.
On July 5, 2004, public respondents filed their Answer17 and on July
13, 2004, filed a Supplement (To the Special and Affirmative
Defenses/Opposition to the Issuance of a Writ of Preliminary
Injunction).18 The parties were then directed to file their respective
memoranda as to the application for issuance of a writ of preliminary
18
injunction and public respondents' special and affirmative defenses.

On July 16, 2004, public respondents as well as the petitioners,19 filed
their respective Memoranda.20 On the same day, respondent Atty.
Ignacio filed his Answer21 to the petition.
Hence, petitioners filed before this Court a Petition for Review on

Certiorari31 dated March 31, 2005 praying for the reversal of the
Decision rendered by the CA's Ninth Division, which is now
docketed as G.R. No. 167824.
In an Order22 dated July 19, 2004, the trial court granted the
application for preliminary injunction enjoining public respondents
from further continuing with the deportation proceedings. The Order
reads, in part:
Thereafter, the CA's Eighth Division rendered its own

Decision32 dated April 29, 2005 granting the petition therein and
nullifying the Orders dated June 28 and July 19, 2004 in Civil Case
No. 04-110179, the dispositive portion of which reads as follows:
In view of the foregoing, the Court finds that, indeed, there exists a
pressing reason to issue a writ of preliminary injunction to protect the
rights of the petitioners pending hearing of the main case on the
merits and unless this Court issues a writ, grave irreparable injury
would be caused against the petitioners.
WHEREFORE, finding the instant petition impressed with merit and

in accordance with our decision in CA-G.R. SP No. 86432, the same
is GIVEN DUE COURSE and is GRANTED. The assailed Orders of
the respondent court dated 28 June and 19 July 2004 are hereby
NULLIFIED and SET ASIDE.
WHEREFORE, premises considered, the application for the Writ of

Preliminary Injunction is hereby GRANTED. The respondents and all
persons acting on their behalf and those under their instructions are
directed to cease and desist from continuing with the deportation
proceedings involving the petitioners during the pendency of the
instant case. The petitioners are directed to post a bond in the amount
of P50,000.00 to answer for whatever damages that may be sustained
by the respondent should the court finally resolve that the petitioners
are not entitled thereto.
SO ORDERED.
Petitioners filed their Motion for Reconsideration33 from the said
Decision, which the CA denied in its Resolution34dated June 21,
2005.
Thus, petitioners filed before this Court a Petition for Review on

Certiorari35 dated July 12, 2005 seeking to reverse and set aside the
said Decision and Resolution rendered by the Eighth Division of the
CA and is now docketed as G.R. No. 168622. In its
SO ORDERED.
Resolution36 dated August 10, 2005, the Court dismissed the said
petition and said dismissal, despite petitioners' motion for
As a consequence, public respondents, on September 10, 2004, filed a reconsideration,37 was affirmed in a Resolution38 dated October 17,
Petition for Certiorari with Prayer for Issuance of Temporary
2005. This Court, however, upon another motion for
Restraining Order and Writ of Preliminary Injunction23 before the
reconsideration39 filed by the petitioners, reinstated the petition and
CA24 and, on September 17, 2004, respondent Atty. Ignacio filed a
ordered its consolidation with G.R. No. 167824.40
25
26
Petition for Certiorari, also with the CA. Both petitions prayed for
the nullification of the Orders dated June 28, 2004 and July 19, 2004 On September 7, 2007, a Manifestation41 was filed informing this
issued by the RTC in Civil Case No. 04-110179 and for the dismissal Court that petitioner Grace Guy Cheu died intestate on August 12,
of the petition therein. Later on, petitioner Geraldine filed a Motion to 2007 in the United States of America.
Consolidate both petitions.
Petitioners raised the following grounds in their Consolidated
On January 6, 2005, the Ninth Division of the CA granted the petition Memorandum42 dated March 27, 2007:
filed by respondent Atty. Ignacio and annulled the writ of preliminary
injunction issued by the trial court, the dispositive portion of the
I.
Decision27 reads:
WHEREFORE, the instant petition is GRANTED and the Order of
the Regional Trial Court, Branch 37, Manila, dated July 19, 2004, is
hereby ANNULLED and SET ASIDE.
SO ORDERED.
On January 21, 2005, petitioners filed a Motion for Reconsideration.28
On March 1, 2005, petitioners reiterated29 their prayer for the
consolidation of the petitions in the Eighth and Ninth Divisions. In its
Resolution30 dated March 10, 2005, the CA Ninth Division denied
petitioners' Motion for Reconsideration.
THE COURT OF APPEALS GRAVELY ABUSED ITS

DISCRETION AND ERRED IN HOLDING THAT THE LOWER
COURT HAS NO JURISDICTION OVER CIVIL CASE NO. 04110179 AND ISSUE A WRIT OF PRELIMINARY INJUNCTION
THEREIN CONSIDERING THAT THE INSTANT CASE IS AN
EXCEPTION TO THE RULE ON PRIMARY JURISDICTION
DOCTRINE AND WARRANTS PETITIONERS' IMMEDIATE
RESORT TO JUDICIAL INTERVENTION.
A.
CONSIDERING THAT PROOF OF PETITIONERS'
PHILIPPINE CITIZENSHIP IS SUBSTANTIAL,
PETITIONERS ARE ALLOWED UNDER THIS
19
HONORABLE COURT'S RULING IN BID V. DELA

ROSA, SUPRA, TO SEEK INJUNCTIVE RELIEF FROM
THE REGIONAL TRIAL COURT TO ENJOIN THE
DEPORTATION PROCEEDINGS CONDUCTED
AGAINST THEM.
B.
True, it is beyond cavil that the Bureau of Immigration has the

exclusive authority and jurisdiction to try and hear cases against an
alleged alien, and in the process, determine also their citizenship (Lao
vs. Court of Appeals, 180 SCRA 756 [1089]. And a mere claim of
citizenship cannot operate to divest the Board of Commissioners of
its jurisdiction in deportation proceedings (Miranda vs. Deportation
Board, 94 Phil. 531 [1951]).
LIKEWISE, CONSIDERING THAT PETITIONERS

STAND TO SUFFER GRAVE AND IRREPARABLE
INJURIES SHOULD THE DEPORTATION
PROCEEDINGS AGAINST THEM BE ALLOWED TO
CONTINUE, PETITIONERS ARE ALLOWED UNDER TE
LAW TO IMMEDIATELY SEEK JUDICIAL RELIEF
DESPITE THE PENDENCY OF THE ADMINISTRATIVE
PROCEEDINGS.
However, the rule enunciated in the above-cases admits of an

exception, at least insofar as deportation proceedings are
concerned. Thus, what if the claim to citizenship of the alleged
deportee is satisfactory? Should the deportation proceedings be
allowed to continue or should the question of citizenship be ventilated
in a judicial proceeding? In Chua Hiong vs. Deportation Board (96
Phil. 665 [1955]), this Court answered the question in the affirmative,
and We quote:
When the evidence submitted by a respondent is conclusive of his

citizenship, the right to immediate review should also be
recognized and the courts should promptly enjoin the deportation
FURTHER, IT IS RESPECTFULLY SUBMITTED THAT THE
proceedings. A citizen is entitled to live in peace, without
RULING OF THIS HONORABLE COURT IN DWIKARNA V.
DOMINGO, 433 SCRA 748 (2004) DID NOT STRIP THE LOWER molestation from any official or authority, and if he is disturbed
COURT OF ITS AUTHORITY TO ENTERTAIN THE PETITION IN by a deportation proceeding, he has the unquestionable right to
resort to the courts for his protection, either by a writ of habeas
CIVIL CASE NO. 04-110179 AND TO ISSUE A WRIT OF
corpus or of prohibition, on the legal ground that the Board lacks
PRELIMINARY INJUNCTION IN THE AFORESAID CASE.
jurisdiction. If he is a citizen and evidence thereof is satisfactory,
there is no sense nor justice in allowing the deportation proceedings
III.
to continue, granting him the remedy only after the Board has
finished its investigation of his undesirability.
EVEN IF THE RULING OF THIS HONORABLE COURT
II.
IN DWIKARNA V. DOMINGO, SUPRA, DID STRIP THE LOWER

x x x And if the right (to peace) is precious and valuable at all, it
COURT OF ITS JURISDICTION IN BID V. DELA ROSA, SUPRA,
TO ENJOIN DEPORTATION PROCEEDINGS, THE RULING CAN must also be protected on time, to prevent undue harassment at
the hands of ill-meaning or misinformed administrative officials.
ONLY HAVE PROSPECTIVE EFFECT.
Of what use is this much boasted right to peace and liberty if it
can be availed of only after the Deportation Board has unjustly
Basically, petitioners argue that the doctrine of primary jurisdiction,
trampled upon it, besmirching the citizen's name before the bar
relied upon by the CA in its decision, does not apply in the present
of public opinion?
case because it falls under an exception. Citing Board of
Commissioners (CID) v. Dela Rosa,43 petitioners assert that
immediate judicial intervention in deportation proceedings is allowed
where the claim of citizenship is so substantial that there are
reasonable grounds to believe that the claim is correct. In connection
therewith, petitioners assail the applicability of Dwikarna v.
Domingo in the present case, which the CA relied upon in ruling
against the same petitioners.
After a careful study of the arguments presented by the parties, this
Court finds the petition meritorious.
Petitioners rely on Board of Commissioners (CID) v. Dela
Rosa,44 wherein this Court ruled that when the claim of citizenship is
so substantial as to reasonably believe it to be true, a respondent in a
deportation proceeding can seek judicial relief to enjoin respondent
BOC from proceeding with the deportation case. In particular,
petitioners cited the following portions in this Court's decision:
The doctrine of primary jurisdiction of petitioners Board of

Commissioners over deportation proceedings is, therefore, not
without exception (Calayday vs. Vivo, 33 SCRA 413 [1970]; Vivo
vs. Montesa, 24 SCRA 155 [1967]). Judicial intervention, however,
should be granted in cases where the claim of citizenship is so
substantial that there are reasonable grounds to believe that the claim
is correct. In other words, the remedy should be allowed only on
sound discretion of a competent court in a proper proceeding
(Chua Hiong v. Deportation Board, supra; Co vs. Deportation
Board, 78 SCRA 107 [1977]). It appearing from the records that
respondent's claim of citizenship is substantial, as We shall show
later, judicial intervention should be allowed.45
The present case, as correctly pointed out by petitioners and
wrongfully found by the CA, falls within the above-cited exception
considering that proof of their Philippine citizenship had been
adduced, such as, the identification numbers46 issued by the Bureau of
Immigration confirming their Philippine citizenship, they have duly
20
exercised and enjoyed all the rights and privileges exclusively

Corollary to the doctrine of exhaustion of administrative remedies is
47
accorded to Filipino citizens, i.e., their Philippine passports issued by the doctrine of primary jurisdiction; that is, courts cannot or will not
the Department of Foreign Affairs.
determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to the resolution of
In BOC v. Dela Rosa, it is required that before judicial intervention is that question by the administrative tribunal, where the question
demands the exercise of sound administrative discretion requiring the
sought, the claim of citizenship of a respondent in a deportation
proceeding must be so substantial that there are reasonable grounds to special knowledge, experience and services of the administrative
believe that such claim is correct. In the said case, the proof adduced tribunal to determine technical and intricate matters of fact.53
by the respondent therein was so substantial and conclusive as to his
citizenship that it warranted a judicial intervention. In the present
Nonetheless, the doctrine of exhaustion of administrative remedies
case, there is a substantial or conclusive evidence that petitioners are and the corollary doctrine of primary jurisdiction, which are based on
Filipino citizens. Without necessarily judging the case on its merits,
sound public policy and practical considerations, are not inflexible
as to whether petitioners had lost their Filipino citizenship by having rules. There are many accepted exceptions, such as: (a) where there is
a Canadian passport, the fact still remains, through the evidence
estoppel on the part of the party invoking the doctrine; (b) where the
adduced and undisputed by the respondents, that they are naturalized challenged administrative act is patently illegal, amounting to lack of
Filipinos, unless proven otherwise.
jurisdiction; (c) where there is unreasonable delay or official inaction
that will irretrievably prejudice the complainant; (d) where the
amount involved is relatively small so as to make the rule impractical
However, this Court cannot pass upon the issue of petitioners'
citizenship as this was not raised as an issue. The issue in this petition and oppressive; (e) where the question involved is purely legal and
is on the matter of jurisdiction, and as discussed above, the trial court will ultimately have to be decided by the courts of justice;54 (f) where
judicial intervention is urgent; (g) when its application may cause
has jurisdiction to pass upon the issue whether petitioners have
abandoned their Filipino citizenship or have acquired dual citizenship great and irreparable damage; (h) where the controverted acts violate
due process; (i) when the issue of non-exhaustion of administrative
within the confines of the law.
remedies has been rendered moot;55 (j) when there is no other plain,
speedy and adequate remedy; (k) when strong public interest is
In this regard, it must be remembered though that this Court's ruling
involved; and, (l) in quo warranto proceedings. x x x56
in Dwikarna v. Domingo did not abandon the doctrine laid down
in BOC v. Dela Rosa. The exception remains. Dwikarna merely
WHEREFORE, the petition is GRANTED. Consequently, the
reiterated the doctrine of primary jurisdiction when this Court ruled
Decisions dated January 6, 2005 and April 20, 2005, and the
that if the petitioner is dissatisfied with the decision of the Board
of Commissioners of the Bureau of Immigration, he can move for Resolutions dated March 10, 2005 and June 29, 2005 of the Court of
its reconsideration and if his motion is denied, then he can elevate Appeals, nullifying and setting aside the Writ of Preliminary
Injunction issued by the Regional Trial Court (RTC), Branch 37,
his case by way of a petition for review before the Court of
Manila, are herebyNULLIFIED and SET ASIDE. The case is hereby
Appeals, pursuant to Section 1, Rule 43 of the Rules of Civil
Procedure. However, utmost caution must be exercised in availing of remanded to the trial court for further proceedings, with dispatch.
the exception laid down in BOC v. Dela Rosa in order to avoid
trampling on the time-honored doctrine of primary jurisdiction. The
SO ORDERED.
court cannot or will not determine a controversy involving a question
which is within the jurisdiction of the administrative tribunal prior to
resolving the same, where the question demands the exercise of sound
administrative discretion requiring special knowledge, experience and
services in determining technical and intricate matters of fact.48 In
cases where the doctrine of primary jurisdiction is clearly applicable,
the court cannot arrogate unto itself the authority to resolve a
controversy, the jurisdiction over which is initially lodged with an
administrative body of special competence.49
Above all else, this Court still upholds the doctrine of primary
jurisdiction. As enunciated in Republic v. Lacap:50
The general rule is that before a party may seek the intervention of
the court, he should first avail of all the means afforded him by
administrative processes.51 The issues which administrative agencies
are authorized to decide should not be summarily taken from them
and submitted to a court without first giving such administrative
agency the opportunity to dispose of the same after due deliberation.52
21
G.R. No. 156686
July 27, 2011
NEW SUN VALLEY HOMEOWNERS' ASSOCIATION,

INC., Petitioner,
vs.
SANGGUNIANG BARANGAY, Barangay Sun Valley, Paraaque
City, Roberto Guevarra IN HIS CAPACITY AS Punong
Barangay and MEMBERS OF THE SANGGUNIANG
BARANGAY, Respondents.
DECISION
LEONARDO-DE CASTRO, J.:
This is a petition for review on certiorari under Rule 45 of the Rules
of Court against the Decision1 dated October 16, 2002 in CA-G.R.
CV No. 65559 and the Resolution2 dated January 17, 2003, both of
the Court of Appeals.
The facts are as follows:
The Sangguniang Barangay of Barangay Sun Valley (the "BSV
Sangguniang Barangay") issued BSV Resolution No. 98-0963 on
October 13, 1998, entitled "Directing the New Sun Valley
Homeowners Association to Open Rosemallow and Aster Streets to
Vehicular and Pedestrian Traffic," the pertinent portions of which
read as follows:
NOW, THEREFORE, be it resolved as it is hereby resolved by the
Sangguniang Barangay in session assembled that
1. Pursuant to its power and authority under the Local
Government Code of 1991 (Rep. Act No. 7160), the New
Sun Valley Homeowners Association (NSVHA) is hereby
directed to open Rosemallow and Aster Sts. to vehicular
(private cars only) and pedestrian traffic at all hours daily
except from 11 p.m. to 5 a.m. at which time the said streets
may be closed for the sake of the security of the residents
therein.
2. The Barangay government take steps to address the
security concerns of the residents of the area concerned,
including the possible assignment of a barangay tanod or
traffic enforcer therein, within the limits of the authority and
financial capability of the Barangay.
3. This Resolution shall become executory within 72 hours
upon receipt hereof by the Association or any of its
members.4
The New Sun Valley Homeowners Association, Inc.
(NSVHAI), represented by its President, Marita Cortez, filed
a Petition5 for a "Writ of Preliminary Injunction/Permanent
Injunction with prayer for issuance of TRO" with the
Regional Trial Court (RTC) of Paraaque City. This was
docketed as Civil Case No. 98-0420. NSVHAI claimed
therein that the implementation of BSV Resolution No. 98096 would "cause grave injustice and irreparable injury" as
"[the] affected homeowners acquired their properties for
strictly residential purposes";6 that the subdivision is a place
that the homeowners envisioned would provide them privacy
and "a peaceful neighborhood, free from the hassles of
public places";7 and that the passage of the Resolution would
destroy the character of the subdivision. NSVHAI averred
that contrary to what was stated in the BSV Resolution, the
opening of the gates of the subdivision would not in any
manner ease the traffic congestion in the area, and that there
were alternative routes available. According to NSVHAI, the
opening of the proposed route to all kinds of vehicles would
result in contributing to the traffic build-up on Doa Soledad
Avenue, and that instead of easing the traffic flow, it would
generate a heavier volume of vehicles in an already
congested choke point. NSVHAI went on to state that a
deterioration of the peace and order condition inside the
subdivision would be inevitable; that the maintenance of
peace and order in the residential area was one of the reasons
why entry and exit to the subdivision was regulated by the
Association and why the passing through of vehicles was
controlled and limited; and that criminal elements would
take advantage of the opening to public use of the roads in
question.8
NSVHAI further contested the BSV Resolution by
submitting the following arguments to the RTC:
12. The road network inside the subdivision and drainage
system is not designed to withstand the entry of a heavy
volume of vehicles especially delivery vans and trucks.
Thus, destruction of the roads and drainage system will
result. The safety, health and well-being of the residents will
face continuous danger to their detriment and prejudice;
13. When the residents bought their residential properties,
they also paid proportionately for the roads and the park in
then subdivision. They have therefore an existing equity on
these roads. To open the roads to public use is a violation of
the rights and interests to a secure, peaceful and healthful
environment;
14. Aside from the availability of a better route to be opened,
there are other ways to ease traffic flow. The continuous
presence of traffic enforcers on all identified traffic choke
points will prevent snarls which impede smooth travel. The
strict enforcement of traffic rules and regulations should be
done;
15. There are a lot of undisciplined drivers of tricycles,
jeepneys, trucks and delivery [vans], which contribute to the
traffic congestion. The barangay should require these drivers
to observe road courtesy and obedience to traffic rules[.]9
22
Executive Judge Helen Bautista-Ricafort of the RTC issued a

Temporary Restraining Order10 (TRO) in Civil Case No. 98-0420 on
October 30, 1998. Said Order provides:
Acting on the Application for Writ of Preliminary Injunction/
Permanent Injunction with Prayer for Issuance of a Temporary
Restraining Order, filed by plaintiff and considering that there is
extreme urgency, such that unless the same is issued, plaintiff would
suffer grave injustice and/or irreparable injury, let a Temporary
Restraining Order issue directing the Sangguniang Barangay as
represented by Punong Barangay Roberto Guevarra to cease and
desist from the implementation of Resolution No. 98-096 or
otherwise maintain the status quo until further Orders of this Court.
This Temporary Restraining Order shall be effective for seventy two
(72) hours from issuance hereof, unless extended by another Order of
this Court.
damages to defendants in the event the Court finds petitioner is not

entitled to said injunction.
The BSV Sangguniang Barangay filed on December 4, 1998 a
Motion for Reconsideration and to Dissolve Preliminary Injunction
(with Memorandum of Authorities).19
NSVHAI then filed an Urgent Ex-Parte Motion to Expunge on
December 10, 1998, moving to declare the above motion of the BSV
Sangguniang Barangay as a mere scrap of paper for being filed out of
time and for failure to serve a copy thereof to the counsel of
petitioner.
The RTC subsequently dismissed the case in an Order20 dated August
17, 1999, stating as follows:
Defendant Barangay Sun Valley moves to dismiss the instant case on

the grounds that the complaint states no cause of action and the court
Let this case be set for special raffle and conference on November 3, has no jurisdiction over the subject matter. In summary, defendant
1998 at 10:30 in the morning.
alleges that the subject streets Aster and Rosemallow inside Sun
Valley Subdivision are owned by the local government. Such streets
On November 3, 1998, the RTC issued another Order11 stating that,
have long been part of the public domain and beyond the commerce
by agreement of the parties, the status quo shall be maintained for
of man. In support of this, defendant cited the case of White Plains
seventeen (17) more days, and that the case was set for hearing on the Association, Inc. vs. Legaspi, 193 SCRA 765 wherein it was held that
prayer for the issuance of a writ of preliminary injunction on
road lots of subdivisions constitute a part of the mandatory open
November 20, 1998 at 8:30 a.m.
space reserved for public use; ownership of which is automatically
vested in the Republic of the Philippines although it is still registered
NSVHAI submitted an Amended Petition12 on November 13, 1998, at in the name of the developer/owner, its donation to the government is
a mere formality." The power or authority to close or open the said
about 11:10 a.m., wherein it claimed that the BSV Sangguniang
streets is vested in the local government units and not on
Barangay had no jurisdiction over the opening of Rosemallow and
homeowners associations, pursuant to Section 21 of the local
Aster Streets (the "subject roads"). NSVHAI likewise attached to its
13
Amended Petition its Position Paper dated July 21, 1998, which set Government Code (RA 7160) quoted as follows: "Section 21. Closure
and Opening of Roads. (a) A local government unit may, pursuant to
forth its objection to the opening of the subject roads for public use
an ordinance, permanently or temporarily close or open any local
and argued that a Barangay Resolution cannot validly cause the
road, alley, park, or square falling within its jurisdiction x x x." In
opening of the subject roads because under the law, an ordinance is
14
view thereof, Resolution No. 98-096 was passed by the Sangguniang
required to effect such an act.
Barangay. Hence there is no right whatsoever on the part of Plaintiff
NSVHA entitled to the protection of the law. Further, defendant
The BSV Sangguniang Barangay filed its Motion to
15
contends that petitioner failed to exhaust administrative remedies as
Dismiss likewise on November 13, 1998. The copy provided by
ordained in Sections 32 and 57 of the Local Government Code giving
petitioner to the Court indicates the time of receipt by NSVHAI as
the city mayor the supervisory power, and the power of review by the
11:00 a.m.16
Sangguniang Panlungsod, respectively.
The RTC heard the case on November 20, 1998, as scheduled, and
thereafter submitted the matter for decision.17 On the same date, the
RTC issued the following Order18:
Acting on the prayer for the issuance of a writ of preliminary
injunction filed by petitioner, it appearing that petitioner may suffer
grave injustice or irreparable injury, let a writ of preliminary
injunction issue prohibiting the Sangguniang Barangay represented
by Punong Barangay Roberto Guevarra from implementing
Resolution no. 98-096 until further orders from this Court.
Petitioner is directed to file a bond in the amount of ONE
HUNDRED THOUSAND (P100,000.00) PESOS (sic) to answer for
No opposition to the motion to dismiss was filed by the Plaintiff.

Same defendant seeks to reconsider the order granting the issuance of
the writ of preliminary injunction alleging that there is a pending
motion to dismiss and Plaintiff has not been able to establish an
actually existing right.
Plaintiff has not filed an opposition thereto, instead it filed an urgent
ex-parte motion to expunge the motion for reconsideration on the
ground that its counsel has not been furnished with a copy of the
motion for reconsideration, but the record shows that Maria Cortez
(plaintiffs representative) has received a copy of said motion.
23
After considering the arguments of the parties in their respective

pleadings, this court hereby resolves as follows:
1. The "Motion for Reconsideration" and the "Urgent Exparte Motion to Expunge (motion for reconsideration)" are
Denied being devoid of merit; and
2. The "Motion to Dismiss" is hereby Granted for failure of
the plaintiff to exhaust the administrative remedies under
Sections 32 and 57 of the Local Government Code.
WHEREFORE, let this case be as it is hereby ordered Dismissed. The
writ of preliminary injunction is hereby lifted.21
COMPETENCE AND WISE DISCRETION OF THE

BARANGAY OVER A LOCAL TRAFFIC PROBLEM.
III
THE TRIAL COURT DID NOT COMMIT ANY SERIOUS
ERROR, PROCEDURAL OR SUBSTANTIVE, AS
FOUND BY THE COURT A QUO. IT IS APPELLANT
THAT HAS COMMITTED THE ERROR OF NOT
EXHAUSTING ADMINISTRATIVE REMEDIES. HENCE,
NO GRAVE OR IRREPARABLE INJURY CAN BE
CAUSED TO APPELLANT FOR IT HAS NO RIGHT TO
PROTECT.26
Respondents claimed that Barangay Resolution No. 98-096 was

simply a directive to petitioner, "a private aggrupation of some selfseeking homeowners,"27 and was just a measure of internal policy
among residents; that the opening of roads for traffic reasons was
"within the sole competence of the barangay to determine"; 28 and the
NSVHAI raised the matter to the Court of Appeals and the case was
Mayor could have chosen, as it was within his power to do so, to
docketed as CA-G.R. CV No. 65559. NSVHAI alleged that "despite
the lack of the required hearing" 24 and without any order requiring it cause the demolition of the gates, which were illegally built by
petitioner and therefore were obstructions on the road, even without a
to submit its Comment/Opposition to the BSV Sangguniang
Barangay resolution. Respondents likewise claimed that the BSVs
Barangays Motion to Dismiss or that of submitting said Motion for
action could be considered a political question, which should be
resolution, Judge Bautista-Ricafort issued an Order which, to
essentially withdrawn from judicial cognizance, and constitutional
NSVHAIs complete surprise, granted the Motion. NSVHAI argued
law doctrine provides that the courts would not interfere with political
that the RTC gravely erred in taking cognizance of, and thereafter
issues unless grave abuse of discretion is shown, of which there was
ruling on, said Motion and refusing to exercise jurisdiction over the
subject matter of Civil Case No. 98-0420. Petitioner likewise argued none on the part of the Barangay. Respondents argued that petitioner
that the RTC committed serious errors which, if not corrected, would did not have any actual legal right entitled to the protection of the
29
cause grave or irreparable injury to petitioner and cause a violation of law.
25
law.
Respondents attached to their Appellees Brief six documents, labeled
The BSV Sangguniang Barangay, Roberto Guevarra in his capacity as as Annexes "2" to "7," all stamped "Certified True Copy" by a certain
Roman E. Loreto, Legal Officer II of Legal Department.30 The
Punong Barangay, and members of the Sangguniang Barangay
detailed information contained in each of the documents that
(hereinafter, "respondents"), in their Appellees Brief, argued as
comprise respondents Annexes "2" to "7" is copied below:
follows:
NSVHAI filed a Motion for Reconsideration22 of the above-quoted
Order but this was denied by the RTC for lack of merit in an
Order23 dated September 21, 1999.
I
THE TRIAL COURT DID NOT ERR IN GRANTING
DEFENDANTS-APPELLEES MOTION TO DISMISS
DUE TO LACK OF CAUSE OF ACTION AND
JURISPRUDENCE OVER THE SUBJECT MATTER AND
APPELLANTS FAILURE TO EXHAUST
ADMINISTRATIVE REMEDIES. AS NOTED BY THE
COURT, NO OPPOSITION TO THE MOTION TO
DISMISS WAS EVER FILED BY APPELLANT.
II
THE TRIAL COURTS DISMISSAL OF THE ACTION
ASSAILING ITS SUBJECT-MATTER, BARANGAY
RESOLUTION NO. 98-096, CONSISTING OF A
DIRECTIVE OF AN LGU TO A DEFIANT PRIVATE
ORGANIZATION WITHIN ITS JURISDICTION, IS
JUDICIAL RECOGNITION OF THE SOLE
1. 1st Indorsement31 from the Office of the Mayor of Paraaque dated

May 20, 1988, signed by Luzviminda A. Concepcion, Administrative
Officer II, stating as follows:
Respectfully indorsed to Atty. Antonio G. Cruz, Municipal Attorney,
of this municipality the herein attached "Original Copies of Transfer
Certificate of Title for Sun Valley Open Space and Road Lots" with
TCT Nos. 133552, 119836, and 122443 for your appropriate actions.
2. Letter32 dated December 27, 1990 from Francisco B. Jose, Jr.,
Municipal Attorney of Paraaque, addressed to the Municipal Council
Secretary, which reads:
This has reference to your request dated December 18, 1990 relative
to the letter of inquiry of the Barangay Captain of Barangay Sun
Valley dated December 13, 1990.
We wish to inform you that based on the available records of our
office the open space and road lots of Sun Valley Subdivision is
24
already owned by the Municipal Government of Paraaque as

evidenced by TCT NOS. 133552, 119836, and 122443. Copies of
which are hereto attached for your ready reference.
Considering that the Municipality of Paraaque is the registered
owner of the road lots of Sun Valley Subdivision, we are of the
opinion that the roads become public in use and ownership, and
therefore, use of the roads by persons other than residents of the
Subdivision can no longer be curtailed. However, should the
Municipal Government decides to delegate its right to regulate the
use of the said roads to the Sun Valley Homeowners Association or
Sun Valley Barangay Council, such right may be exercise[d] by said
association or council.
3. Certification33 dated October 8, 1990 issued by Francisco B. Jose,
Jr. under the letterhead of the Office of the Municipal Attorney of
Paraaque, which reads:
Municipality of Paranaque as evidenced by TCT NO. 133552,

119836, and 122443.
This certification is being issued upon the request of MR. WILLIAM
UY.
The Court of Appeals issued a Decision dated October 16, 2002
denying the appeal and affirming the Orders of the RTC dated August
17, 1999 and September 21, 1999. The Court of Appeals likewise
denied NSVHAIs Motion for Partial Reconsideration in its
Resolution promulgated on January 17, 2003, stating that after a
thorough study of the Motion for Reconsideration, it found no
sufficient reason to deviate from its findings and conclusion reached
in its decision.
Thus, NSVHAI (hereinafter, "petitioner") went to this Court.
Arguments of Petitioner
This is to certify that based on the available records of this Office, the
open space and road lots of Sun Valley Subdivision has been donated
and now owned by the Municipality of Paranaque, as evidenced by
TCT Nos. 133552, 119836, and 122443 copies of which are hereto
attached.
This certification is being issued upon the request of Mr. Mario
Cortez, President of Sun Valley Homeowners Association.
Petitioner alleges that the decision of the Court of Appeals was based
on "facts that [were] outside of the original Petition and Amended
Petition and on supposed findings of facts that are not even evidence
offered before the court a quo."37 Petitioner likewise alleges that the
facts used by the Court of Appeals in dismissing the case were
contrary to the records of Civil Case No. 98-0420.
Petitioner lists the following as its Questions of Law:
4. Certification34 dated June 13, 1994, again signed by Francisco B.

Jose, Jr., of the Office of the Municipal Attorney, providing as
follows:
In sustaining the dismissal of Civil Case No. 98-0420, the Honorable

This is to certify that based on the available records of this Office, the Court of Appeals sanctioned the departure of the Regional Trial Court
only road lots in Sun Valley Subdivision titled in the name of the
from the accepted and usual course of judicial proceedings
Municipality of Paraaque are those covered by Transfer Certificates
of Title Nos. 133552 and 122443.
B
This certification is being issued upon the request of Coun. Manuel T. Whether or not the issuance of the Resolution promulgated January
De Guia.
17, 2003 and the Decision promulgated October 16, 2002 by the
Former 4th Division and the 4th Division of the Court of Appeals
5. Certification35 dated March 2, 1995 issued by Rodolfo O. Alora,
sustaining the validity of dismissal of Civil Case No. 98-0420 is not
OIC, Asst. Municipal Legal Officer, which reads:
in accord with law or with the applicable decisions of this Honorable
Supreme Court
This is to certify that based on the available records of this Office, the
open space within Sun Valley Subdivision has already been donated
C
to the Municipality as evidenced by Transfer Certificate of Title No.
119836, copy of which is hereto attached.
Whether or not the Honorable Court of Appeals, with due respect,
This certification is being issued upon the request of Atty. Rex G.
Rico.
6. Certification36 dated October 26, 1998 issued by Ma. Riza Pureza
Manalese, Legal Researcher, Office of the Municipal Attorney,
Paraaque City, which reads:
This is to certify that based on the available records of this Office,
road lots of Sun Valley Subdivision have already been donated to the
departed from the accepted and usual course of judicial proceedings

by making findings of fact not supported by evidence of record38
Petitioner avers that the hearing for the respondents Motion to
Dismiss was set on November 20, 1998, without indication as to time
and that during the hearing on such date, counsel for respondents
moved that their Motion to Dismiss be heard over the objection of
counsel for petitioner, who explained that there was an urgency in
ruling on the prayer for the issuance of a writ of preliminary
25
injunction in view of the expiration of the temporary restraining order 1997 Rules of Civil Procedure for failing to set the time of hearing
(TRO).39
thereof; and that instead of being resolved, said motion should have
been declared as a mere scrap of worthless paper.44
Petitioner quotes the transcript of stenographic notes (TSN) from the
November 20, 1998 hearing before the RTC in the following manner: Petitioner claims that during the proceedings before the RTC on
November 20, 1998, both parties manifested that the Motion to
Dismiss was never set for hearing, and that when Judge BautistaAtty. Herrera:
Ricafort said, "We will proceed first with the hearing,"45 she was
referring to the scheduled hearing of the prayer for the issuance of the
Then, Your Honor, I files [sic] a motion petitioning to dismiss this
writ of preliminary injunction. Petitioner claims that it is crystal clear
instant case, which should be resolved first before hearing this case.
that it was deprived due process when a ruling was had on the Motion
to Dismiss despite the clear absence of a hearing. Petitioner concludes
Atty. Nuez:
that the Court of Appeals was manifestly mistaken when it ruled that
due process was observed in the issuance of the assailed Orders of
Your Honor, please, with due respect to the opposing counsel, the
Judge Bautista-Ricafort, despite the lack of opportunity to submit a
hearing today is supposed to be on the presentation of petitioners
comment or opposition to the Motion to Dismiss and the lack of
evidence in support of its prayer for preliminary injunction. In
connection with the amended complaint, I guess it is a matter of right issuance of an order submitting said motion for resolution. Petitioner
to amend its pleading. What happened here, the amended petition was alleges that the Court of Appeals sanctioned the ruling of the RTC
46
filed before this Honorable Court on November 13 at 11:10 a.m. but I that violated both substantial and procedural law.
think the motion to dismiss was filed by the respondent on November
Moreover, petitioner avers that contrary to the ruling of the Court of
13 at 11:20 a.m.. Therefore, it is the right of the petitioner insofar as
Appeals, the RTC had jurisdiction to hear and decide the Amended
the case is concerned.
Petition, and the doctrine of exhaustion of administrative remedies
was not applicable. This is because, according to petitioner, such
And therefore, this Court should proceed with the hearing on the
doctrine "requires that were a remedy before an administrative
preliminary injunction instead of entertaining this matter. The
temporary restraining order will expire today and we have the right to agency is provided, relief must first be sought from the administrative
agencies prior to bringing an action before courts of
be heard.
justice."47 Petitioner claims that when it filed Civil Case No. 9808420, it did not have the luxury of time to elevate the matter to the
Court:
higher authorities under Sections 32 and 57 of the Local Government
Code. Petitioner alleges that the tenor of BSV Resolution No. 98-096
We will proceed first with the hearing (referring to the scheduled
necessitated the immediate filing of the injunction case on October
hearing of the prayer for the issuance of the writ of preliminary
29, 1998, to forestall the prejudicial effect of said resolution that was
injunction). (Transcript of Stenographic Notes, November 20, 1998)
to take effect two days later. Thus, petitioner claims that it had no
(Underscoring and explanation petitioners.)40
other plain, speedy, and adequate remedy except to file the case.48
Petitioner claims that the RTC proceeded to hear the prayer for the
issuance of a preliminary injunction and no hearing was conducted on
the Motion to Dismiss. Petitioner reiterates its earlier claim that it did
not receive an order requiring it to submit its Comment/Opposition to
the Motion to Dismiss or informing it that said Motion had been
submitted for resolution.41
Petitioner alleges that the dismissal of Civil Case No. 98-0420 arose
from the grant of respondents Motion to Dismiss. Petitioner claims
that it filed its Amended Petition on November 13, 1998 at 11:10
a.m., or before respondents served any responsive pleading, or before
they had filed their Motion to Dismiss on the same date at about
11:20 a.m.42 Petitioner avers that the filing of said Amended Petition
was a matter of right under Section 2, Rule 10 of the 1997 Rules of
Civil Procedure, and had the effect of superseding the original
petition dated October 28, 1998. Petitioner concludes that the Motion
to Dismiss was therefore directed against a non-existing Petition.43
Petitioner argues that the RTCs ruling on the Motion to Dismiss is
contrary to procedural law because no hearing was conducted on said
Motion to Dismiss; that said motion violated Section 5, Rule 10 of the
Anent the question of whether the Sangguniang Barangay should

have passed an ordinance instead of a resolution to open the subject
roads, petitioner alleges that the Court of Appeals should not have
relied on respondents claim of ownership, as this led to the erroneous
conclusion that there was no need to pass an ordinance. Petitioner
insists that the supposed titles to the subject roads were never
submitted to the RTC, and the respondents merely attached
certifications that the ownership of the subject roads was already
vested in the City Government of Paraaque City as Annexes to their
Appellees Brief before the Court of Appeals. Those annexes,
according to petitioner, were not formally offered as evidence.49
Petitioner avers that the records of Civil Case No. 98-0420 clearly
show that there was no proof or evidence on record to support the
findings of the Court of Appeals. This is because, allegedly, the
dismissal of said case was due to the grant of a motion to dismiss, and
the case did not go to trial to receive evidence.50 Petitioner avers that
a motion to dismiss hypothetically admits the truth of the facts
alleged in the complaint.51 In adopting the annexes as basis for its
26
findings of fact, the Court of Appeals allegedly disregarded the rules

on Evidence.
We admit that we erred in not going to you directly because at that

time, the NSVHA received the letter-order of Brgy. Capt. Guevara
two days before the effectivity of the order. Aside from this, there was
Petitioner raises the following grounds for the issuance by this Court a long holiday (long weekend prior to November 1). Thus, the Board
of a temporary restraining order and/or writ of preliminary injunction: of Governors had no other recourse but to seek a TRO and thereafter
a permanent injunction.
Sangguniang Barangay Resolution No. 98-096 is repugnant to the
We now would like to seek your assistance concerning this urgent
proprietary rights of the affected homeowners who are members of
problem. For your information there are already two (2) gates in and
petitioner NSVHAI, such rights undoubtedly protected by the
out of Sun Valley Subdivision.
Constitution.
As there is no proof otherwise (except the baseless findings of fact by
the Honorable Court of Appeals) that the streets encompassed by the
concerned subdivision, Sun Valley Subdivision, are all private
properties. As such, the residents of Sun Valley Subdivision have all
the right to regulate the roads and open spaces within their territorial
jurisdiction.
This Honorable Supreme Court can take judicial knowledge that
criminal activities such as robbery and kidnappings are becoming
daily fares in Philippine society. Residents have invested their
lifetimes savings in private subdivision since subdivision living
afford them privacy, exclusivity and foremost of all, safety. Living in
a subdivision has a premium and such premium translates into a
comparatively more expensive lot because of the safety, among
others, that subdivision lifestyle offers.
Under P.D. 957, the Homeowners Association is mandated to protect

the interest of the homeowners and residents especially in so far as it
affects the security, comfort and the general welfare of the
homeowners.
Thank you and because of the urgency of the matter, we anticipate
your prompt and favorable action. (Emphasis ours.)
2. A letter54 signed by Paraaque City Mayor Joey Marquez dated
January 27, 2003, addressed to Mr. Roberto Guevara, Office of the
Barangay Captain, Barangay Sun Valley, which reads in part:
This refers to your intended implementation of Barangay Sun Valley

Resolution No. 98-096 entitled, "A RESOLUTION DIRECTING
THE NEW SUN VALLEY HOMEOWNERS ASSOCIATION TO
OPEN ROSEMALLOW AND ASTER STREETS TO VEHICULAR
But, with the enactment and intended implementation of Sangguniang AND PEDESTRIAN TRAFFIC."
Barangay Resolution No. 98-096 to open Rosemallow and Aster
Streets for public use, it is indubitable that, instead of promoting the
In this regard and pursuant to the provisions of Sec. 32 of the Local
safety of resident of Sun Valley Subdivision, respondents are
Government Code of 1991 which vests upon the city mayor the right
endangering the life and property of the residents of the said
to exercise general supervision over component barangays, to ensure
subdivision as they will now be exposed to criminal and lawless
that said barangays act within the scope of their prescribed powers
elements.
and functions, you are hereby directed to defer your implementation
of the subject ordinance based on the following grounds:
It is respectfully submitted that Sangguniang Barangay Resolution
No. 98-096 has a place only in an authoritarian government where
1. The roads subject of your resolution is a municipal road
proprietary rights and privacy are alien concepts. Lest it be forgotten,
and not a barangay road;
ours is a democratic society and therefore, it should not be ruled in a
manner befitting of a despotic government.
2. The opening or closure of any local road may be
undertaken by a local government unit pursuant to an
Petitioner NSVHAI, in protection of the rights and interest of the
ordinance and not through a mere resolution as provided
residents of Sun Valley Subdivision and in order to ensure that public
under Sec. 21 of the Local Government Code of 1991;
officials will not abuse governmental powers and use them in an
oppressive and arbitrary manner, invokes the judicial power of this
3. There is no more need to order the opening of the
Honorable Supreme Court and pray that a writ of preliminary
aforementioned roads in view of the fact that Gelia and State
injunction be issued and, after hearing, be declared permanent. 52
Ave., have already been opened by the subdivision to the
general public to accommodate vehicular and pedestrian
A perusal of the documents attached by petitioner as Annexes
traffic in the area;
revealed to the Court the following, which were not discussed in the
body of the petition:
4. There is a need to conduct public hearings, as in fact we
shall be conducting public hearings, on the matter to enable
1. A letter53 dated January 25, 2003 signed by Sonia G. Sison,
us to arrive at an intelligent resolution of the issues involved.
President of NSVHAI, to Mayor Joey P. Marquez, the pertinent
portions of which provide:
27
55
3. A letter dated January 31, 2003 addressed to Mayor Joey Respondents claim that since the subject matter of the case is a
Marquez, signed by counsel for respondents, wherein the
directive of the Barangay to the petitioner, the requirement for an
latter wrote:
ordinance would not be necessary, as there was no legislative
determination in the Barangay resolution regarding what class of
roads to open or what to close by way of general policy. 60
We regret to observe that all the reasons that you have cited in your
letter as grounds for your order of non-implementation of the
Barangay Resolution have been passed upon and decided by the
Respondents contend that the Barangay Resolution was internal and
Court of Appeals, which lately denied the NSVHA Motion for
temporary, passed to solve a traffic problem. They propose a reason
Reconsideration x x x.
why petitioner allegedly wants to control the subject roads, as
follows:
xxxx
The directive of the Barangay is certainly a declaration of an intention
The Decision of the Court of Appeals is now the subject of an appeal expressed by resolution on complaints of residents for a convenient
taken by the NSVHA to the Supreme Court. In deference to the high outlet of cars and pedestrians during certain hours of the [day] or
night. This need not be the subject of an ordinance. It is addressed to
Court, you would do well to reconsider your order to the Barangay
a special group of residents, and not to the general community. It
and not pre-empt the high Court on its decision. x x x.
refers to particular roads and at certain hours only, not to all the roads
and at all hours.
Arguments of Respondents
Hence, the Barangay Resolutions (sic) is but temporary in character,
being a solution to a momentary traffic problem then visualized by
the Barangay and encouraged by the MMDA. There is no legal
question involved that is of any concern to the NSVHA. The
prevailing reason why the NSVHA desires to control the roads is the
monetary consideration it gains by its unilateral requirement of car
stickers and of substantial fees exacted from delivery vans and trucks
Respondents claim that the hearing held on November 20, 1998, as
for bringing in cargo into the subdivision. And yet, the residents who,
found by the Court of Appeals, covered both the injunction and
never gave their consent to this activities (sic), are busy people and
dismissal incidents, and that the motion to dismiss on issues of
have merely tolerated this for a long time now. This tolerance did not
jurisdiction was a prejudicial matter. Respondents confirm that the
61
RTC said it will proceed first with the hearing, but the lower court did of course give legality to the illegal act. x x x.
not specify if the hearing was going to take up the prayer for the
As regards petitioners argument that the BSV Sangguniang Barangay
issuance of preliminary injunction or the motion to dismiss.
should have passed an ordinance instead of a resolution, respondents
Respondents further claim that by the end of the hearing, after Atty.
present their counter-argument as follows:
Florencio R. Herreras manifestation on the donated public roads,
counsels for both parties were asked by the court if they were
Hence, even assuming for the sake of argument that a legal question
submitting, and both of them answered in the
affirmative. 57 Respondents aver that petitioners reply to its charge of exists on whether it be a resolution or ordinance that should contain
the Barangay directive, such an issue is of no moment as plaintiffmisleading the Court was an admission that counsel had tampered
appellant failed to exhaust the necessary administrative
without authority with the TSN, and that the phrase "referring to the
remedies before resorting to court action, as found by the trial court
scheduled hearing of the prayer for the issuance of the writ of
and the Court of Appeals. Section 32, R.A. 7160 (Local Government
preliminary injunction"58 was said counsels own mere footnote.
Code of 1991) provides for a remedy from Barangay actions to the
Mayor under the latters power of general supervision.62
Respondents allege that the issuance of the titles in favor of
Paraaque over all the roads in Sun Valley Subdivision was an
With regard to the Mayors involvement in this case, respondents
official act by the land registration office of the City of Paraaque,
and was perfectly within the judicial notice of the Courts, pursuant to have this to say:
Rule 129, Section 1 of the Rules of Court.59 Respondents likewise
allege that the gates were earlier built illegally on the roads by the
The Mayors act of interfering in Barangay Sun Valley affairs
Association, and while petitioner may lend a helping hand to the
stemmed out of a long-standing political feud of the Mayor with the
barangay, it cannot control the latters discretion as to the wisdom of Punong Barangay. Its general supervision did not extend to pure
its traffic policies within the barangay. They maintain that petitioner
Barangay matters, which the Barangay would be x x x in a better
had no business putting up road blocks in the first place; that this
position to determine.
matter is purely a local government determination; and that it is even
doubtful if courts would encroach upon this autonomous
Furthermore, the general supervision of the Mayor is limited to the
determination for local constituents of the Barangay in deference to
overseeing authority that the Barangays act within the scope of their
the doctrine of separation of powers.
prescribed powers and functions. Sadly, there is nothing in this
Respondents filed their Comment56 on July 17, 2003. They manifest
that the petition is substantially a reproduction of petitioners brief
filed with the Court of Appeals, and consists of almost identical
issues which have already been ventilated and decided upon by the
said court.
28
Mayors letter x x x that would as much as show a deviation by the

Barangay Sun Valley from any prescribed powers or function. The
Mayors directive to the Barangay is of doubtful legality.
It bears stressing that due process simply means giving every

contending party the opportunity to be heard and the court to consider
every piece of evidence presented in their favor (Batangas Laguna
Tayabas Bus Company versus Benjamin Bitanga, G.R. Nos. 137934
It was mainly the mounting traffic problem progressively experienced & 137936[)]. In the instant case, Appellant cannot be said to have
been denied of due process. As borne by the records, while Appellees
through the years that prompted the Barangay to resolve to open
Motion to Dismiss did not set the time for the hearing of the motion,
Rosemallow and Aster Streets in accordance with its power under
Section 21 of R.A. 7160 to "temporarily open or close any local road the day set therefore was the same date set for the hearing of
Appellants prayer for the issuance of a writ of preliminary injunction
falling within its jurisdiction". This Resolution x x x was decided
that is, November 20, 1998, with the precise purpose of presenting
upon after the Barangay Council made the necessary investigation
evidence in support of the motion to dismiss on the same said
and conducted hearings in consultation with affected residents. In
order to maintain some kind of cordial relationship with the NSVHA, scheduled hearing date and time when Appellant and its counsel
the Barangay by its resolution, opted to give the NSVHA the chance would be present. Moreover, Appellants predication of lack of due
hearing is belied by the fact that the hearing held on November 20,
to open the roads, which it earlier closed by means of arbitrarily
63
1999 took up not only the matter of whether or not to grant the
putting up steel gates without any apparent authority.
injunction, but also tackled the jurisdictional issue raised in
Appellees Motion to Dismiss, which issues were intertwined in both
Furthermore, respondents aver that the trial court and the appellate
67
court have ruled that only a local government unit (LGU), in this case incidents.
the Barangay, can open or close roads, whether they be public or
We see no reason to depart from these findings by the Court of
private, in accordance with Section 21 of the Local Government
Appeals. Petitioners recourse in questioning BSV Resolution No. 98Code. Respondents contend that Metropolitan Manila Development
64
096 should have been with the Mayor of Paraaque City, as clearly
Authority v. Bel-Air Village Association, Inc., wherein the Court
discussed the power of LGUs to open and close roads, is substantially stated in Section 32 of the Local Government Code, which provides:
in point.65
Section 32. City and Municipal Supervision over Their Respective
After the submission of the parties respective memoranda,66 this case Barangays. - The city or municipality, through the city or municipal
mayor concerned, shall exercise general supervision over component
was submitted for decision.
barangays to ensure that said barangays act within the scope of their
prescribed powers and functions.
The issues before us are:
1. Whether or not petitioner has a right to the protection of
the law that would entitle it to injunctive relief against the
implementation of BSV Resolution No. 98-096; and
2. Whether or not petitioner failed to exhaust administrative
remedies.
The Ruling of the Court
The Court of Appeals passed upon petitioners claims as to the
validity of the dismissal in this wise:
We do not agree. Although the Motion to Dismiss was filed on the
same day, but after, the Amended Petition was filed, the same cannot
be considered as directed merely against the original petition which
Appellant already considers as non-existing. The records will show
that Appellants Amended Petition contained no material amendments
to the original petition. Both allege the same factual circumstances or
events that constitute the Appellants cause of action anent the
Appellees alleged violation of Appellants propriety rights over the
subdivision roads in question. Corollarily, the allegations in
Appellees Motion to Dismiss, as well as the grounds therefore
predicated on lack of cause of action and jurisdiction, could very well
be considered as likewise addressed to Appellants Amended Petition.
We do not see how petitioners act could qualify as an exception to

the doctrine of exhaustion of administrative remedies. We have
emphasized the importance of applying this doctrine in a recent case,
wherein we held:
The doctrine of exhaustion of administrative remedies is a
cornerstone of our judicial system. The thrust of the rule is that courts
must allow administrative agencies to carry out their functions and
discharge their responsibilities within the specialized areas of their
respective competence. The rationale for this doctrine is obvious. It
entails lesser expenses and provides for the speedier resolution of
controversies. Comity and convenience also impel courts of justice to
shy away from a dispute until the system of administrative redress
has been completed.68
It is the Mayor who can best review the Sangguniang Barangays
actions to see if it acted within the scope of its prescribed powers and
functions. Indeed, this is a local problem to be resolved within the
local government. Thus, the Court of Appeals correctly found that the
trial court committed no reversible error in dismissing the case for
petitioners failure to exhaust administrative remedies, as the
requirement under the Local Government Code that the closure and
opening of roads be made pursuant to an ordinance, instead of a
resolution, is not applicable in this case because the subject roads
belong to the City Government of Paraaque.
xxxx
29
Moreover, being the party asking for injunctive relief, the burden of
proof was on petitioner to show ownership over the subject roads.
This, petitioner failed to do.
may be considered merely as a directive or reminder to the Appellant

to cause the opening of a public road which should rightfully be open
for use to the general public.70
In civil cases, it is a basic rule that the party making allegations has
the burden of proving them by a preponderance of evidence. Parties
must rely on the strength of their own evidence and not upon the
weakness of the defense offered by their opponent.69
Petitioner wants this Court to recognize the rights and interests of the
residents of Sun Valley Subdivision but it miserably failed to
establish the legal basis, such as its ownership of the subject roads,
which entitles petitioner to the remedy prayed for. It even wants this
Court to take "judicial knowledge that criminal activities such as
robbery and kidnappings are becoming daily fares in Philippine
society."71 This is absurd. The Rules of Court provide which matters
constitute judicial notice, to wit:
Petitioner dared to question the barangays ownership over the

subject roads when it should have been the one to adduce evidence to
support its broad claims of exclusivity and privacy. Petitioner did not
submit an iota of proof to support its acts of ownership, which, as
pointed out by respondents, consisted of closing the subject roads that
belonged to the then Municipality of Paraaque and were already
being used by the public, limiting their use exclusively to the
subdivisions homeowners, and collecting fees from delivery vans
that would pass through the gates that they themselves had built. It is
petitioners authority to put up the road blocks in the first place that
becomes highly questionable absent any proof of ownership.
Rule 129
WHAT NEED NOT BE PROVED
SECTION 1. Judicial notice, when mandatory.A court shall take

judicial notice, without the introduction of evidence, of the existence
and territorial extent of states, their political history, forms of
government and symbols of nationality, the law of nations, the
admiralty and maritime courts of the world and their seals, the
On the other hand, the local government units power to close and
political constitution and history of the Philippines, the official acts of
open roads within its jurisdiction is clear under the Local Government the legislative, executive and judicial departments of the Philippines,
Code, Section 21 of which provides:
the laws of nature, the measure of time, and the geographical
divisions.(1a)1avvphi1
Section 21. Closure and Opening of Roads. (a) A local government
unit may, pursuant to an ordinance,permanently or temporarily close The activities claimed by petitioner to be part of judicial knowledge
or open any local road, alley, park, or square falling within its
are not found in the rule quoted above and do not support its petition
jurisdiction: Provided, however, That in case of permanent closure,
for injunctive relief in any way.
such ordinance must be approved by at least two-thirds (2/3) of all the
members of the sanggunian, and when necessary, an adequate
As petitioner has failed to establish that it has any right entitled to the
substitute for the public facility that is subject to closure is provided. protection of the law, and it also failed to exhaust administrative
remedies by applying for injunctive relief instead of going to the
We quote with approval the ruling of the Court of Appeals in this
Mayor as provided by the Local Government Code, the petition must
regard, as follows:
be denied.
Contrary, however, to Appellants position, the above-quoted
provision, which requires the passage of an ordinance by a local
government unit to effect the opening of a local road, can have no
applicability to the instant case since the subdivision road lots sought
to be opened to decongest traffic in the area - namely Rosemallow
and Aster Streets have already been donated by the Sun Valley
Subdivision to, and the titles thereto already issued in the name of,
the City Government of Paraaque since the year 1964 (Annexes "2"
to "7" of Appellees Brief). This fact has not even been denied by the
Appellant in the proceedings below nor in the present recourse.
Having been already donated or turned over to the City Government
of Paraaque, the road lots in question have since then taken the
nature of public roads which are withdrawn from the commerce of
man, and hence placed beyond the private rights or claims of herein
Appellant. Accordingly, the Appellant was not in the lawful exercise
of its predicated rights when it built obstructing structures closing the
road lots in question to vehicular traffic for the use of the general
Public. Consequently, Appellees act of passing the disputed barangay
resolution, the implementation of which is sought to be restrained by
Appellant, had for its purpose not the opening of a private road but
WHEREFORE, premises considered, the petition is hereby DENIED.

The Court of Appeals DECISION dated October 16, 2002 and its
RESOLUTION dated January 17, 2003 in CA-G.R. CV No. 65559
are both AFFIRMED.
SO ORDERED.
30
G.R. No. 176707
February 17, 2010
ARLIN B. OBIASCA, 1 Petitioner,

vs.
JEANE O. BASALLOTE, Respondent.
DECISION
In its decision, the Ombudsman found Oyardo and Gonzales

administratively liable for withholding information from respondent
on the status of her appointment, and suspended them from the
service for three months. Diaz was absolved of any wrongdoing.5
Respondent also filed a protest with CSC Regional Office V. But the
protest was dismissed on the ground that it should first be submitted
to the Grievance Committee of the DepEd for appropriate action.6
CORONA, J.:
When the law is clear, there is no other recourse but to apply it
regardless of its perceived harshness. Dura lex sed lex. Nonetheless,
the law should never be applied or interpreted to oppress one in order
to favor another. As a court of law and of justice, this Court has the
duty to adjudicate conflicting claims based not only on the cold
provision of the law but also according to the higher principles of
right and justice.
On motion for reconsideration, the protest was reinstated but was

eventually dismissed for lack of merit.7Respondent appealed the
dismissal of her protest to the CSC Regional Office which, however,
dismissed the appeal for failure to show that her appointment had
been received and attested by the CSC.8
Respondent elevated the matter to the CSC. In its November 29, 2005
resolution, the CSC granted the appeal, approved respondents
appointment and recalled the approval of petitioners appointment.9
The facts of this case are undisputed.

On May 26, 2003, City Schools Division Superintendent Nelly B.
Beloso appointed respondent Jeane O. Basallote to the position of
Administrative Officer II, Item No. OSEC-DECSB-ADO2-3900301998, of the Department of Education (DepEd), Tabaco National
High School in Albay.2
Aggrieved, petitioner filed a petition for certiorari in the Court of

Appeals (CA) claiming that the CSC acted without factual and legal
bases in recalling his appointment. He also prayed for the issuance of
a temporary restraining order and a writ of preliminary injunction.
In its September 26, 2006 decision,10 the CA denied the petition and
upheld respondents appointment which was deemed effective
immediately upon its issuance by the appointing authority on May 26,
2003. This was because respondent had accepted the appointment
upon her assumption of the duties and responsibilities of the position.
Subsequently, in a letter dated June 4, 2003,3 the new City Schools

Division Superintendent, Ma. Amy O. Oyardo, advised School
Principal Dr. Leticia B. Gonzales that the papers of the applicants for
the position of Administrative Officer II of the school, including those
The CA found that respondent possessed all the qualifications and
of respondent, were being returned and that a school ranking should
none of the disqualifications for the position of Administrative
be
Officer II; that due to the respondents valid appointment, no other
appointment to the same position could be made without the position
accomplished and submitted to her office for review. In addition,
being first vacated; that the petitioners appointment to the position
Gonzales was advised that only qualified applicants should be
was thus void; and that, contrary to the argument of petitioner that he
endorsed.
had been deprived of his right to due process when he was not
allowed to participate in the proceedings in the CSC, it was petitioner
Respondent assumed the office of Administrative Officer II on June
19, 2003. Thereafter, however, she received a letter from Ma. Teresa who failed to exercise his right by failing to submit a single pleading
U. Diaz, Human Resource Management Officer I of the City Schools despite being furnished with copies of the pleadings in the
proceedings in the CSC.
Division of Tabaco City, Albay, informing her that her appointment
could not be forwarded to the Civil Service Commission (CSC)
because of her failure to submit the position description form (PDF)
duly signed by Gonzales.
Respondent tried to obtain Gozales signature but the latter refused
despite repeated requests. When respondent informed Oyardo of the
situation, she was instead advised to return to her former teaching
position of Teacher I. Respondent followed the advice.
The CA opined that Diaz unreasonably refused to affix her signature

on respondents PDF and to submit respondents appointment to the
CSC on the ground of non-submission of respondents PDF. The CA
ruled that the PDF was not even required to be submitted and
forwarded to the CSC.
Petitioner filed a motion for reconsideration but his motion was
denied on February 8, 2007.11
Meanwhile, on August 25, 2003, Oyardo appointed petitioner Arlin

Hence, this petition.12
B. Obiasca to the same position of Administrative Officer II. The
appointment was sent to and was properly attested by the CSC.4 Upon
Petitioner maintains that respondent was not validly appointed to the
learning this, respondent filed a complaint with the Office of the
position of Administrative Officer II because her appointment was
Deputy Ombudsman for Luzon against Oyardo, Gonzales and Diaz.
never attested by the CSC. According to petitioner, without the CSC
31
attestation, respondents appointment as Administrative Officer II was

never completed and never vested her a permanent title. As such,
respondents appointment could still be recalled or withdrawn by the
appointing authority. Petitioner further argues that, under the
Omnibus Rules Implementing Book V of Executive Order (EO) No.
292,13 every appointment is required to be submitted to the CSC
within 30 days from the date of issuance; otherwise, the appointment
becomes ineffective.14 Thus, respondents appointment issued on May
23, 2003 should have been transmitted to the CSC not later than June
22, 2003 for proper attestation. However, because respondents
appointment was not sent to the CSC within the proper period, her
appointment ceased to be effective and the position of Administrative
Officer II was already vacant when petitioner was appointed to it.
This provision is implemented in Section 11, Rule V of the Omnibus

Rules Implementing Book V of EO 292 (Omnibus Rules):
In her comment,15 respondent points out that her appointment was

wrongfully not submitted by the proper persons to the CSC for
attestation. The reason given by Oyardo for the non-submission of
respondents appointment papers to the CSC the alleged failure of
respondent to have her PDF duly signed by Gonzales was not a
valid reason because the PDF was not even required for the
attestation of respondents appointment by the CSC.
The real issue in this case is whether the deliberate failure of the
appointing authority (or other responsible officials) to submit
respondents appointment paper to the CSC within 30 days from its
issuance made her appointment ineffective and incomplete.
Substantial reasons dictate that it did not.
The law on the matter is clear. The problem is petitioners insistence

that the law be applied in a manner that is unjust and unreasonable.
Remedy to Assail CSC Decision or Resolution
Section 11. An appointment not submitted to the [CSC] within thirty

(30) days from the date of issuance which shall be the date appearing
on the fact of the appointment, shall be ineffective. xxx
Based on the foregoing provisions, petitioner argues that respondents
appointment became effective on the day of her appointment but it
subsequently ceased to be so when the appointing authority did not
submit her appointment to the CSC for attestation within 30 days.
Petitioner is wrong.
Before discussing this issue, however, it must be brought to mind that

CSC resolution dated November 29, 2005 recalling petitioners
After due consideration of the respective arguments of the parties, we appointment and approving that of respondent has long become final
deny the petition.
and executory.
Sections 16 and 18, Rule VI of the Omnibus Rules provide the proper
Petitioner relies on an overly restrictive reading of Section 9(h) of PD remedy to assail a CSC decision or resolution:
80716 which states, in part, that an appointment must be submitted by
the appointing authority to the CSC within 30 days from issuance,
Section 16. An employee who is still not satisfied with the decision of
otherwise, the appointment becomes ineffective:
the [Merit System Protection Board] may appeal to the [CSC] within
fifteen days from receipt of the decision.
Sec. 9. Powers and Functions of the Commission. The [CSC] shall
administer the Civil Service and shall have the following powers and The decision of the [CSC] is final and executory if no petition for
functions:
reconsideration is filed within fifteen days from receipt thereof.
xxx
xxx
xxx
(h) Approve all appointments, whether original or promotional, to

positions in the civil service, except those of presidential appointees,
members of the Armed Forces of the Philippines, police forces,
firemen and jailguards, and disapprove those where the appointees do
not possess the appropriate eligibility or required qualifications. An
appointment shall take effect immediately upon issue by the
appointing authority if the appointee assumes his duties immediately
and shall remain effective until it is disapproved by the [CSC], if this
should take place, without prejudice to the liability of the appointing
authority for appointments issued in violation of existing laws or
rules: Provided, finally, That the [CSC] shall keep a record of
appointments of all officers and employees in the civil service. All
appointments requiring the approval of the [CSC] as herein
provided, shall be submitted to it by the appointing authority
within thirty days from issuance, otherwise the appointment
becomes ineffective thirty days thereafter. (Emphasis supplied)
xxx
xxx
xxx
Section 18. Failure to file a protest, appeal, petition for

reconsideration or petition for review within the prescribed
period shall be deemed a waiver of such right and shall render
the subject action/decision final and executory. (Emphasis
supplied)
In this case, petitioner did not file a petition for reconsideration of the
CSC resolution dated November 29, 2005 before filing a petition for
review in the CA. Such fatal procedural lapse on petitioners part
allowed the CSC resolution dated November 29, 2005 to become
final and executory.17 Hence, for all intents and purposes, the CSC
resolution dated November 29, 2005 has become immutable and can
no longer be amended or modified.18 A final and definitive
judgment can no longer be changed, revised, amended or
reversed.19 Thus, in praying for the reversal of the assailed Court of
Appeals decision which affirmed the final and executory CSC
resolution dated November 29, 2005, petitioner would want the Court
32
to reverse a final and executory judgment and disregard the doctrine

of immutability of final judgments.
True, a dissatisfied employee of the civil service is not preempted
from availing of remedies other than those provided in Section 18 of
the Omnibus Rules. This is precisely the purpose of Rule 43 of the
Rules of Court, which provides for the filing of a petition for review
as a remedy to challenge the decisions of the CSC.
While Section 18 of the Omnibus Rules does not supplant the mode
of appeal under Rule 43, we cannot disregard Section 16 of the
Omnibus Rules, which requires that a petition for reconsideration
should be filed, otherwise, the CSC decision will become final and
executory, viz.:
The decision of the [CSC] is final and executory if no petition for
reconsideration is filed within fifteen days from receipt
thereof. 1avvphi1
upon issue by the appointing authority if the appointee assumes

his duties immediately and shall remain effective until it is
disapproved by the [CSC]." This provision is reinforced by Section
1, Rule IV of the Revised Omnibus Rules on Appointments and Other
Personnel Actions, which reads:
Section 1. An appointment issued in accordance with pertinent
laws and rules shall take effect immediately upon its issuance by
the appointing authority, and if the appointee has assumed the
duties of the position, he shall be entitled to receive his salary at once
without awaiting the approval of his appointment by the
Commission. The appointment shall remain effective until
disapproved by the Commission. x x x (Emphasis supplied)
More importantly, Section 12, Book V of EO 292 amended Section
9(h) of PD 807 by deleting the requirement that all appointments
subject to CSC approval be submitted to it within 30 days. Section 12
of EO 292 provides:
Note that the foregoing provision is a specific remedy as against CSC Sec. 12. Powers and Functions. - The Commission shall have the
following powers and functions:
decisions involving its administrativefunction, that is, on matters
involving "appointments, whether original or promotional, to
positions in the civil service,"20 as opposed to its quasi-judicial
xxx
xxx
xxx
function where it adjudicates the rights of persons before it, in
accordance with the standards laid down by the law.21
(14) Take appropriate action on all appointments and other personnel
matters in the Civil Service, including extension of Service beyond
The doctrine of exhaustion of administrative remedies requires that,
retirement age;
for reasons of law, comity and convenience, where the enabling
statute indicates a procedure for administrative review and provides a (15) Inspect and audit the personnel actions and programs of the
system of administrative appeal or reconsideration, the courts will not departments, agencies, bureaus, offices, local government units and
entertain a case unless the available administrative remedies have
other instrumentalities of the government including government
been resorted to and the appropriate authorities have been given an
-owned or controlled corporations; conduct periodic review of the
opportunity to act and correct the errors committed in the
decisions and actions of offices or officials to whom authority has
administrative forum.22 In Orosa v. Roa,23 the Court ruled that if an
been delegated by the Commission as well as the conduct of the
appeal or remedy obtains or is available within the administrative
officials and the employees in these offices and apply appropriate
machinery, this should be resorted to before resort can be made to the sanctions whenever necessary.
courts.24 While the doctrine of exhaustion of administrative remedies
is subject to certain exceptions,25 these are not present in this case.
As a rule, an amendment by the deletion of certain words or phrases
indicates an intention to change its meaning.26 It is presumed that the
Thus, absent any definitive ruling that the second paragraph of
deletion would not have been made had there been no intention to
Section 16 is not mandatory and the filing of a petition for
effect a change in the meaning of the law or rule.27 The word, phrase
reconsideration may be dispensed with, then the Court must adhere to or sentence excised should accordingly be considered inoperative.28
the dictates of Section 16 of the Omnibus Rules.
The dissent refuses to recognize the amendment of Section 9(h) of PD
Moreover, even in its substantive aspect, the petition is bereft of
807 by EO 292 but rather finds the requirement of submission of
merit.
appointments within 30 days not inconsistent with the authority of the
CSC to take appropriate action on all appointments and other
Section 9(h) of PD 807 Already Amended by Section 12 Book V of personnel matters. However, the intention to amend by deletion is
EO 292
unmistakable not only in the operational meaning of EO 292 but in its
legislative history as well.
It is incorrect to interpret Section 9(h) of Presidential Decree (PD)
807 as requiring that an appointment must be submitted by the
PD 807 and EO 292 are not inconsistent insofar as they require CSC
appointing authority to the CSC within 30 days from issuance,
action on appointments to the civil service. This is evident from the
otherwise, the appointment would become ineffective. Such
recognition accorded by EO 292, specifically under Section 12 (14)
interpretation fails to appreciate the relevant part of Section 9(h)
and (15) thereof, to the involvement of the CSC in all personnel
which states that "an appointment shall take effect immediately
actions and programs of the government. However, while a restrictive
33
period of 30 days within which appointments must be submitted to

the CSC is imposed under the last sentence of Section 9(h) of PD
807, none was adopted by Section 12 (14) and (15) of EO 292.
Rather, provisions subsequent to Section 12 merely state that the CSC
(and its liaison staff in various departments and agencies)
shallperiodically monitor, inspect and audit personnel
actions.29 Moreover, under Section 9(h) of PD 807, appointments not
submitted within 30 days to the CSC become ineffective, no such
specific adverse effect is contemplated under Section 12 (14) and (15)
of EO 292. Certainly, the two provisions are materially inconsistent
with each other. And to insist on reconciling them by restoring the
restrictive period and punitive effect of Section 9(h) of PD 807,
which EO 292 deliberately discarded, would be to rewrite the law by
mere judicial interpretation.30
unjustified refusal to sign it on the feigned and fallacious ground that

respondents position description form had not been duly signed by
School Principal Dr. Leticia B. Gonzales.35 Indeed, the CSC even
sanctioned Diaz for her failure to act in the required
manner.36 Similarly, the Ombudsman found both City Schools
Division Superintendent Ma. Amy O. Oyardo and Gonzales
administratively liable and suspended them for three months for
willfully withholding information from respondent on the status of
her appointment.
xxx
xxx
xxx
All along, [respondent] was made to believe that her appointment was
in order. During the same period, respondent Gonzales, with
respondent Oyardos knowledge, indifferently allowed [respondent]
Not even the historical development of civil service laws can justify
to plea for the signing of her [position description form], when they
the retention of such restrictive provisions. Public Law No. 5,31 the
could have easily apprised [respondent] about the
law formally establishing a civil service system, merely directed that revocation/withdrawal of her appointment. Worse, when [respondent]
all heads of offices notify the Philippine Civil Service Board "in
informed Oyardo on 25 June 2003 about her assumption of office as
writing without delay of all appointments x x x made in the classified [Administrative Officer II], the latter directed [respondent] to go back
service."32 The Revised Administrative Code of 1917 was even less
to her post as Teacher I on the ground that [respondent] had not been
stringent as approval by the Director of the Civil Service of
issued an attested appointment as [Administrative Officer II], even
appointments of temporary and emergency employees was required
when [Oyardo] knew very well that [respondents] appointment could
only when practicable. Finally, Republic Act (RA) 226033 imposed no not be processed with the CSC because of her order to re-evaluate the
period within which appointments were attested to by local
applicants. This act by [Oyardo] is a mockery of the trust reposed
government treasurers to whom the CSC delegated its authority to act upon her by [respondent], who, then in the state of quandary,
on personnel actions but provided that if within 180 days after receipt specifically sought [Oyardos] advice on what to do with her
of said appointments, the CSC shall not have made any correction or appointment, in the belief that her superior could enlighten her on the
revision, then such appointments shall be deemed to have been
matter.
properly made. Consequently, it was only under PD 807 that
submission of appointments for approval by the CSC was subjected
It was only on 02 July 2003 when [Gonzales], in her letter, first made
to a 30-day period. That, however, has been lifted and abandoned by reference to a re-ranking of the applicants when [respondent] learned
EO 292.
about the recall by [Oyardo] of her appointment. At that time, the
thirty-day period within which to submit her appointment to the CSC
There being no requirement in EO 292 that appointments should be
has lapsed. [Oyardos] and Gonzales act of withholding information
submitted to the CSC for attestation within 30 days from issuance, it about the real status of [respondents] appointment unjustly deprived
is doubtful by what authority the CSC imposed such condition under her of pursuing whatever legal remedies available to her at that time
Section 11, Rule V of the Omnibus Rules. It certainly cannot restore
to protect her interest.37
what EO 292 itself already and deliberately removed. At the very
least, that requirement cannot be used as basis to unjustly prejudice
Considering these willful and deliberate acts of the co-conspirators
respondent.
Diaz, Oyardo and Gonzales that caused undue prejudice to
respondent, the Court cannot look the other way and make respondent
Under the facts obtaining in this case, respondent promptly assumed suffer the malicious consequences of Gonzaless and Oyardos
her duties as Administrative Officer II when her appointment was
malfeasance. Otherwise, the Court would be recognizing a result that
issued by the appointing authority. Thus, her appointment took effect is unconscionable and unjust by effectively validating the following
immediately and remained effective until disapproved by the
inequities: respondent, who was vigilantly following up her
CSC.34 Respondents appointment was never disapproved by the
appointment paper, was left to hang and dry; to add insult to injury,
CSC. In fact, the CSC was deprived of the opportunity to act
not long after Oyardo advised her to return to her teaching position,
promptly as it was wrongly prevented from doing so. More
she (Oyardo) appointed petitioner in respondents stead.
importantly, the CSC subsequently approved respondents
appointment and recalled that of petitioner, which recall has already The obvious misgiving that comes to mind is why Gonzales and
become final and immutable.
Oyardo were able to promptly process petitioners appointment and
transmit the same to the CSC for attestation when they could not do
Second, it is undisputed that respondents appointment was not
so for respondent. There is no doubt that office politics was moving
submitted to the CSC, not through her own fault but because of
behind the scenes.
Human Resource Management Officer I Ma. Teresa U. Diazs
34
In effect, Gonzales and Oyardos scheming and plotting unduly

petitioner gave undue emphasis to the non-attestation by the CSC of
deprived respondent of the professional advancement she deserved.
respondents appointment, without any regard for the fact that the
While public office is not property to which one may acquire a vested CSC actually approved respondents appointment.
right, it is nevertheless a protected right.38
Third, the Court is urged to overlook the injustice done to respondent
It cannot be overemphasized that respondents appointment became
by citing Favis v. Rupisan42 and Tomali v. Civil Service Commission.43
effective upon its issuance by the appointing authority and it
remained effective until disapproved by the CSC (if at all it ever
However, reliance on Favis is misplaced. In Favis, the issue pertains
was). Disregarding this rule and putting undue importance on the
to the necessity of the CSC approval, not the submission of the
provision requiring the submission of the appointment to the CSC
appointment to the CSC within 30 days from issuance. Moreover,
within 30 days will reward wrongdoing in the appointment process of unlike Favis where there was an apparent lack of effort to procure the
public officials and employees. It will open the door for scheming
approval of the CSC, respondent in this case was resolute in
officials to block the completion and implementation of an
following up her appointment papers. Thus, despite Favis having
appointment and render it ineffective by the simple expedient of not
assumed the responsibilities of PVTA Assistant General Manager for
submitting the appointment paper to the CSC. As indubitably shown almost two years, the Court affirmed her removal, ruling that:
in this case, even respondents vigilance could not guard against the
malice and grave abuse of discretion of her superiors.
The tolerance, acquiescence or mistake of the proper officials,
resulting in the non-observance of the pertinent rules on the matter
There is no dispute that the approval of the CSC is a legal
does not render the legal requirement, on the necessity of approval
requirement to complete the appointment. Under settled
by the Commissioner of Civil Service of appointments, ineffective
jurisprudence, the appointee acquires a vested legal right to the
and unenforceable.44 (Emphasis supplied)
position or office pursuant to this completed
appointment.39 Respondents appointment was in fact already
Taken in its entirety, this case shows that the lack of CSC
approved by the CSC with finality.
approval was not due to any negligence on respondents part.
Neither was it due to the "tolerance, acquiescence or mistake of
The purpose of the requirement to submit the appointment to the CSC the proper officials." Rather, the underhanded machinations of
is for the latter to approve or disapprove such appointment depending Gonzales and Oyardo, as well as the gullibility of Diaz, were the
on whether the appointee possesses the appropriate eligibility or
major reasons why respondents appointment was not even
required qualifications and whether the laws and rules pertinent to the forwarded to the CSC.
process of appointment have been followed.40 With this in mind,
respondents appointment should all the more be deemed valid.
Tomali, likewise, is not applicable. The facts are completely different.
In Tomali, petitioner Tomalis appointment was not approved by the
Respondents papers were in order. What was sought from her (the
CSC due to the belated transmittal thereof to the latter. The Court,
position description form duly signed by Gonzales) was not even a
citing Favis, ruled that the appointees failure to secure the CSCs
prerequisite before her appointment papers could be forwarded to the approval within the 30-day period rendered her appointment
CSC. More significantly, respondent was qualified for the position.
ineffective. It quoted the Merit Systems Protection Boards finding
Thus, as stated by the CA:
that "there is no showing that the non-submission was motivated by
bad faith, spite, malice or at least attributed to the fault of the newly
The evidence also reveals compliance with the procedures that should installed [Office of Muslim Affairs] Executive Director." The Court
be observed in the selection process for the vacant position of
observed:
Administrative Officer II and the issuance of the appointment to the
respondent: the vacancy for the said position was published on
Petitioner herself would not appear to be all that blameless. She
February 28, 2003; the Personnel Selection Board of Dep-Ed
assumed the position four months after her appointment was issued or
Division of Tabaco City conducted a screening of the applicants,
months after that appointment had already lapsed or had become
which included the respondent and the petitioner; the respondents
ineffective by operation of law. Petitioner's appointment was issued
qualifications met the minimum qualifications for the position of
on 01 July 1990, but it was only on 31 May 1991 that it was
Administrative Officer II provided by the CSC. She therefore
submitted to the CSC, a fact which she knew, should have known or
qualified for permanent appointment.41
should have at least verified considering the relatively long interval of
time between the date of her appointment and the date of her
There is no doubt that, had the appointing authority only submitted
assumption to office.45
respondents appointment to the CSC within the said 30 days from its
issuance, the CSC would (and could ) have approved it. In fact, when The Court also found that "[t]here (was) nothing on record to
the CSC was later apprised of respondents prior appointment when
convince us that the new OMA Director (had) unjustly favored
she protested petitioners subsequent appointment, it was
private respondent nor (had) exercised his power of appointment in
respondents appointment which the CSC approved. Petitioners
an arbitrary, whimsical or despotic manner."46
appointment was recalled. These points were never rebutted as
35
The peculiar circumstances in Tomali are definitely not present here.

As a matter of fact, the situation was exactly the opposite. As we have
repeatedly stressed, respondent was not remiss in zealously following
up the status of her appointment. It cannot be reasonably claimed that
the failure to submit respondents appointment to the CSC was due to
her own fault. The culpability lay in the manner the appointing
officials exercised their power with arbitrariness, whim and
despotism. The whole scheme was intended to favor another
applicant.
The Court reached the same conclusion in the recent case of Chavez
v. Ronidel49 where there was a similar inaction from the responsible
officials which resulted in non-compliance with the requirement:
Lastly, we agree with the appellate court that respondent's
appointment could not be invalidated solely because of [Presidential
Commission for the Urban Poors (PCUPs)] failure to submit two
copies of the ROPA as required by CSC Resolution No. 97368. xxxx
xxx
Therefore, the lack of CSC approval in Favis and Tomali should be

taken only in that light and not overly stretched to cover any and all
similar cases involving the 30-day rule. Certainly, the CSC approval
cannot be done away with. However, an innocent appointee like the
respondent should not be penalized if her papers (which were in the
custody and control of others who, it turned out, were all scheming
against her) did not reach the CSC on time. After all, her appointment
was subsequently approved by the CSC anyway.
xxx
xxx
We quote with approval the appellate court's ratiocination in this

wise:
To our minds, however, the invalidation of the [respondent's]

appointment based on this sole technical ground is unwarranted,
if not harsh and arbitrary, considering the factual milieu of this
case. For one, it is not the [respondent's] duty to comply with the
requirement of the submission of the ROPA and the certified true
Under Article 1186 of the Civil Code, "[t]he condition shall be
copies of her appointment to [the Civil Service Commission Field
deemed fulfilled when the obligor voluntarily prevents its
Office or] CSCFO within the period stated in the aforequoted CSC
fulfillment." Applying this to the appointment process in the civil
Resolution. The said resolution categorically provides that it is the
service, unless the appointee himself is negligent in following up the PCUP, and not the appointee as in the case of the [respondent] here,
submission of his appointment to the CSC for approval, he should not which is required to comply with the said reportorial requirements.
be prejudiced by any willful act done in bad faith by the appointing
authority to prevent the timely submission of his appointment to the
Moreover, it bears pointing out that only a few days after the
CSC. While it may be argued that the submission of respondents
[petitioner] assumed his new post as PCUP Chairman, he directed the
appointment to the CSC within 30 days was one of the conditions for PCUP to hold the processing of [respondent's] appointment papers in
the approval of respondents appointment, however, deliberately and abeyance, until such time that an assessment thereto is officially
with bad faith, the officials responsible for the submission of
released from his office. Unfortunately, up to this very day, the
respondents appointment to the CSC prevented the fulfillment of the [respondent] is still defending her right to enjoy her promotional
said condition. Thus, the said condition should be deemed fulfilled.
appointment as DMO V. Naturally, her appointment failed to
The Court has already had the occasion to rule that an appointment
remains valid in certain instances despite non-compliance of the
proper officials with the pertinent CSC rules. In Civil Service
Commission v. Joson, Jr.,47the CSC challenged the validity of the
appointment of Ong on the ground that, among others, it was not
reported in the July 1995 Report of Personnel Action (ROPA), thus
making such appointment ineffective. The subject rule provided that
an "appointment issued within the month but not listed in the ROPA
for the said month shall become ineffective thirty days from
issuance." Rejecting the CSCs contention, the Court held that there
was a legitimate justification for such delayed observance of the rule:
We find the respondent's justification for the failure of the POEA to
include Ong's appointment in its ROPA for July 1995 as required by
CSC Memorandum Circular No. 27, Series of 1994 to be in order.
The records show that the [Philippine Overseas Employment
Administration (POEA)] did not include the contractual appointment
of Ong in its July ROPA because its request for exemption from the
educational requisite for confidential staff members provided in
[Memorandum Circular] No. 38 had yet been resolved by the CSC.
The resolution of the petitioner granting such request was received
only in November, 1995. The POEA, thereafter, reported the
appointment in its November, 1995 ROPA.48
comply with the PCUP's reportorial requirements under CSC

Resolution No. 97-3685precisely because of the [petitioner's]
inaction to the same.
We believe that the factual circumstances of this case calls for the
application of equity. To our minds, the invalidation of the
[respondent's] appointment due to a procedural lapse which is
undoubtedly beyond her control, and certainly not of her own
making but that of the [petitioner], justifies the relaxation of the
provisions of CSC Board Resolution No. 97-3685, pars. 6,7 and 8.
Hence, her appointment must be upheld based on equitable
considerations, and that the non-submission of the ROPA and the
certified true copies of her appointment to the CSCFO within the
period stated in the aforequoted CSC Resolution should not work to
her damage and prejudice. Besides, the [respondent] could not at all
be faulted for negligence as she exerted all the necessary
vigilance and efforts to reap the blessings of a work promotion.
Thus, We cannot simply ignore her plight. She has fought hard
enough to claim what is rightfully hers and, as a matter of simple
justice, good conscience, and equity, We should not allow Ourselves
to prolong her agony.
All told, We hold that the [respondent's] appointment is valid,
notwithstanding the aforecited procedural lapse on the part of PCUP
36
which obviously was the own making of herein [petitioner].

(Emphasis supplied)
Respondent deserves the same sympathy from the Court because
there was also a telling reason behind the non-submission of her
appointment paper within the 30-day period.
The relevance of Joson and Chavez to this case cannot be simply
glossed over. While the agencies concerned in those cases were
accredited agencies of the CSC which could take final action on the
appointments, that is not the case here. Thus, any such differentiation
is unnecessary. It did not even factor in the Courts disposition of the
issue in Joson and Chavez. What is crucial is that, in those cases, the
Court upheld the appointment despite the non-compliance with a CSC
rule because (1) there were valid justifications for the lapse; (2) the
non-compliance was beyond the control of the appointee and (3) the
appointee was not negligent. All these reasons are present in this case,
thus, there is no basis in saying that the afore-cited cases are not
applicable here. Similar things merit similar treatment.1avvphi1
Fourth, in appointing petitioner, the appointing authority effectively
revoked the previous appointment of respondent and usurped the
power of the CSC to withdraw or revoke an appointment that had
already been accepted by the appointee. It is the CSC, not the
appointing authority, which has this power.50 This is clearly provided
in Section 9, Rule V of the Omnibus Rules:
The power to revoke an earlier appointment through the appointment

of another may not be conceded to the appointing authority. Such
position is not only contrary to Section 9, Rule V and Section 1, Rule
IV of the Omnibus Rules. It is also a dangerous reading of the law
because it unduly expands the discretion given to the appointing
authority and removes the checks and balances that will rein in any
abuse that may take place. The Court cannot countenance such
erroneous and perilous interpretation of the law.
Accordingly, petitioners subsequent appointment was void. There
can be no appointment to a non-vacant position. The incumbent must
first be legally removed, or her appointment validly terminated,
before another can be appointed to succeed her.52
In sum, the appointment of petitioner was inconsistent with the law
and well-established jurisprudence. It not only disregarded the
doctrine of immutability of final judgments but also unduly
concentrated on a narrow portion of the provision of law, overlooking
the greater part of the provision and other related rules and using a
legal doctrine rigidly and out of context. Its effect was to perpetuate
an injustice.
WHEREFORE, the petition is hereby DENIED.
Costs against petitioner.
SO ORDERED.
Section 9. An appointment accepted by the appointee cannot be

withdrawn or revoked by the appointing authority and shall
remain in force and effect until disapproved by the [CSC]. xxxx
(Emphasis supplied)
Thus, the Court ruled in De Rama v. Court of Appeals51 that it is the
CSC which is authorized to recall an appointment initially approved
when such appointment and approval are proven to be in disregard of
applicable provisions of the civil service law and regulations.
Petitioner seeks to inflexibly impose the condition of submission of
the appointment to the CSC by the appointing authority within 30
days from issuance, that is, regardless of the negligence/diligence of
the appointee and the bad faith/good faith of the appointing authority
to ensure compliance with the condition. However, such stance
would place the appointee at the mercy and whim of the
appointing authority even after a valid appointment has been
made. For although the appointing authority may not recall an
appointment accepted by the appointee, he or she can still achieve the
same result through underhanded machinations that impedes or
prevents the transmittal of the appointment to the CSC. In other
words, the insistence on a strict application of the condition regarding
the submission of the appointment to the CSC within 30 days, would
give the appointing authority the power to do indirectly what he or
she cannot do directly. An administrative rule that is of doubtful basis
will not only produce unjust consequences but also corrupt the
appointment process. Obviously, such undesirable end result could
not have been the intention of the law.
37
G.R. No. 158253
March 2, 2007
REPUBLIC OF THE PHILIPPINES, represented by the

DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS,
COMMISSION ON AUDIT and THE NATIONAL
TREASURER, Petitioner,
vs.
CARLITO LACAP, doing business under the name and style
CARWIN CONSTRUCTION AND CONSTRUCTION
SUPPLY, Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
Before the Court is a Petition for Review on Certiorari under Rule 45
of the Revised Rules of Court assailing the Decision1 dated April 28,
2003 of the Court of Appeals (CA) in CA-G.R. CV No. 56345 which
affirmed with modification the Decision2 of the Regional Trial Court,
Branch 41, San Fernando, Pampanga (RTC) in Civil Case No. 10538,
granting the complaint for Specific Performance and Damages filed
by Carlito Lacap (respondent) against the Republic of the Philippines
(petitioner).
The factual background of the case is as follows:
The District Engineer of Pampanga issued and duly published an
"Invitation To Bid" dated January 27, 1992. Respondent, doing
business under the name and style Carwin Construction and
Construction Supply (Carwin Construction), was pre-qualified
together with two other contractors. Since respondent submitted the
lowest bid, he was awarded the contract for the concreting
of Sitio 5 Bahay Pare.3 On November 4, 1992, a Contract Agreement
was executed by respondent and petitioner.4 On September 25, 1992,
District Engineer Rafael S. Ponio issued a Notice to Proceed with the
concreting of Sitio 5 Bahay Pare.5 Accordingly, respondent undertook
the works, made advances for the purchase of the materials and
payment for labor costs.6
On October 29, 1992, personnel of the Office of the District Engineer
of San Fernando, Pampanga conducted a final inspection of the
project and found it 100% completed in accordance with the
approved plans and specifications. Accordingly, the Office of the
District Engineer issued Certificates of Final Inspection and Final
Acceptance.7
Thereafter, respondent sought to collect payment for the completed
project.8 The DPWH prepared the Disbursement Voucher in favor of
petitioner.9 However, the DPWH withheld payment from respondent
after the District Auditor of the Commission on Audit (COA)
disapproved the final release of funds on the ground that the
contractors license of respondent had expired at the time of the
execution of the contract. The District Engineer sought the opinion of
the DPWH Legal Department on whether the contracts of Carwin
Construction for various Mount Pinatubo rehabilitation projects were
valid and effective although its contractors license had already

expired when the projects were contracted.10
In a Letter-Reply dated September 1, 1993, Cesar D. Mejia, Director
III of the DPWH Legal Department opined that since Republic Act
No. 4566 (R.A. No. 4566), otherwise known as the Contractors
License Law, does not provide that a contract entered into after the
license has expired is void and there is no law which expressly
prohibits or declares void such contract, the contract is enforceable
and payment may be paid, without prejudice to any appropriate
administrative liability action that may be imposed on the contractor
and the government officials or employees concerned.11
In a Letter dated July 4, 1994, the District Engineer requested
clarification from the DPWH Legal Department on whether Carwin
Construction should be paid for works accomplished despite an
expired contractors license at the time the contracts were executed. 12
In a First Indorsement dated July 20, 1994, Cesar D. Mejia, Director
III of the Legal Department, recommended that payment should be
made to Carwin Construction, reiterating his earlier legal
opinion.13 Despite such recommendation for payment, no payment
was made to respondent.
Thus, on July 3, 1995, respondent filed the complaint for Specific
Performance and Damages against petitioner before the RTC.14
On September 14, 1995, petitioner, through the Office of the Solicitor
General (OSG), filed a Motion to Dismiss the complaint on the
grounds that the complaint states no cause of action and that the RTC
had no jurisdiction over the nature of the action since respondent did
not appeal to the COA the decision of the District Auditor to
disapprove the claim.15
Following the submission of respondents Opposition to Motion to
Dismiss,16 the RTC issued an Order dated March 11, 1996 denying
the Motion to Dismiss.17 The OSG filed a Motion for
Reconsideration18 but it was likewise denied by the RTC in its Order
dated May 23, 1996.19
On August 5, 1996, the OSG filed its Answer invoking the defenses
of non-exhaustion of administrative remedies and the doctrine of nonsuability of the State.20
Following trial, the RTC rendered on February 19, 1997 its Decision,
the dispositive portion of which reads as follows:
WHEREFORE, in view of all the foregoing consideration, judgment
is hereby rendered in favor of the plaintiff and against the defendant,
ordering the latter, thru its District Engineer at Sindalan, San
Fernando, Pampanga, to pay the following:
a) P457,000.00 representing the contract for the concreting project
of Sitio 5 road, Bahay Pare, Candaba, Pampanga plus interest at 12%
from demand until fully paid; and
38
b) The costs of suit.

SO ORDERED.21
The RTC held that petitioner must be required to pay the contract
price since it has accepted the completed project and enjoyed the
benefits thereof; to hold otherwise would be to overrun the long
standing and consistent pronouncement against enriching oneself at
the expense of another.22
Dissatisfied, petitioner filed an appeal with the CA.23 On April 28,
2003, the CA rendered its Decision sustaining the Decision of the
RTC. It held that since the case involves the application of the
principle of estoppel against the government which is a purely legal
question, then the principle of exhaustion of administrative remedies
does not apply; that by its actions the government is estopped from
questioning the validity and binding effect of the Contract Agreement
with the respondent; that denial of payment to respondent on purely
technical grounds after successful completion of the project is not
countenanced either by justice or equity.
The CA rendered herein the assailed Decision dated April 28, 2003,
the dispositive portion of which reads:
submits that equity demands that he be paid for the work performed;
otherwise, the mandate of the Civil Code provisions relating to
human relations would be rendered nugatory if the State itself is
allowed to ignore and circumvent the standard of behavior it sets for
its inhabitants.
The present petition is bereft of merit.
The general rule is that before a party may seek the intervention of
the court, he should first avail of all the means afforded him by
administrative processes.29 The issues which administrative agencies
are authorized to decide should not be summarily taken from them
and submitted to a court without first giving such administrative
agency the opportunity to dispose of the same after due deliberation.30
Corollary to the doctrine of exhaustion of administrative remedies is
the doctrine of primary jurisdiction; that is, courts cannot or will not
determine a controversy involving a question which is within the
jurisdiction of the administrative tribunal prior to the resolution of
that question by the administrative tribunal, where the question
demands the exercise of sound administrative discretion requiring the
special knowledge, experience and services of the administrative
tribunal to determine technical and intricate matters of fact.31
WHEREFORE, the decision of the lower court is hereby AFFIRMED Nonetheless, the doctrine of exhaustion of administrative remedies
and the corollary doctrine of primary jurisdiction, which are based on
with modification in that the interest shall be six percent (6%) per
sound public policy and practical considerations, are not inflexible
annum computed from June 21, 1995.
rules. There are many accepted exceptions, such as: (a) where there is
24
estoppel on the part of the party invoking the doctrine; (b) where the
SO ORDERED.
challenged administrative act is patently illegal, amounting to lack of
jurisdiction; (c) where there is unreasonable delay or official inaction
Hence, the present petition on the following ground:
that will irretrievably prejudice the complainant; (d) where the
amount involved is relatively small so as to make the rule impractical
THE COURT OF APPEALS ERRED IN NOT FINDING THAT
and oppressive; (e) where the question involved is purely legal and
RESPONDENT HAS NO CAUSE OF ACTION AGAINST
will ultimately have to be decided by the courts of justice;32 (f) where
PETITIONER, CONSIDERING THAT:
judicial intervention is urgent; (g) when its application may cause
great and irreparable damage; (h) where the controverted acts violate
(a) RESPONDENT FAILED TO EXHAUST ADMINISTRATIVE
due process; (i) when the issue of non-exhaustion of administrative
REMEDIES; AND
remedies has been rendered moot;33 (j) when there is no other plain,
speedy and adequate remedy; (k) when strong public interest is
(b) IT IS THE COMMISSION ON AUDIT WHICH HAS THE
involved; and, (l) in quo warranto proceedings.34 Exceptions (c) and
PRIMARY JURISDICTION TO RESOLVE RESPONDENTS
(e) are applicable to the present case.
MONEY CLAIM AGAINST THE GOVERNMENT.25
Petitioner contends that respondents recourse to judicial action was
premature since the proper remedy was to appeal the District
Auditors disapproval of payment to the COA, pursuant to Section
48, Presidential Decree No. 1445 (P.D. No. 1445), otherwise known
as the Government Auditing Code of the Philippines; that the COA
has primary jurisdiction to resolve respondents money claim against
the government under Section 2(1),26 Article IX of the 1987
Constitution and Section 2627 of P.D. No. 1445; that non-observance
of the doctrine of exhaustion of administrative remedies and the
principle of primary jurisdiction results in a lack of cause of action.
Respondent, on the other hand, in his Memorandum28 limited his
discussion to Civil Code provisions relating to human relations. He
Notwithstanding the legal opinions of the DPWH Legal Department

rendered in 1993 and 1994 that payment to a contractor with an
expired contractors license is proper, respondent remained unpaid for
the completed work despite repeated demands. Clearly, there was
unreasonable delay and official inaction to the great prejudice of
respondent.
Furthermore, whether a contractor with an expired license at the time
of the execution of its contract is entitled to be paid for completed
projects, clearly is a pure question of law. It does not involve an
examination of the probative value of the evidence presented by the
parties. There is a question of law when the doubt or difference arises
as to what the law is on a certain state of facts, and not as to the truth
39
35
or the falsehood of alleged facts. Said question at best could be

resolved only tentatively by the administrative authorities. The final
decision on the matter rests not with them but with the courts of
justice. Exhaustion of administrative remedies does not apply,
because nothing of an administrative nature is to be or can be
done.36 The issue does not require technical knowledge and
experience but one that would involve the interpretation and
application of law.
Thus, while it is undisputed that the District Auditor of the COA
disapproved respondents claim against the Government, and, under
Section 4837 of P.D. No. 1445, the administrative remedy available to
respondent is an appeal of the denial of his claim by the District
Auditor to the COA itself, the Court holds that, in view of exceptions
(c) and (e) narrated above, the complaint for specific performance and
damages was not prematurely filed and within the jurisdiction of the
RTC to resolve, despite the failure to exhaust administrative
remedies. As the Court aptly stated in Rocamora v. RTC-Cebu
(Branch VIII):38
The plaintiffs were not supposed to hold their breath and wait until
the Commission on Audit and the Ministry of Public Highways had
acted on the claims for compensation for the lands appropriated by
the government. The road had been completed; the Pope had come
and gone; but the plaintiffs had yet to be paid for the properties taken
from them. Given this official indifference, which apparently would
continue indefinitely, the private respondents had to act to assert and
protect their interests.39
On the question of whether a contractor with an expired license is
entitled to be paid for completed projects, Section 35 of R.A. No.
4566 explicitly provides:
SEC. 35. Penalties. Any contractor who, for a price, commission, fee
or wage, submits or attempts to submit a bid to construct, or contracts
to or undertakes to construct, or assumes charge in a supervisory
capacity of a construction work within the purview of this Act,
without first securing a license to engage in the business of
contracting in this country; or who shall present or file the license
certificate of another, give false evidence of any kind to the Board, or
any member thereof in obtaining a certificate or license, impersonate
another, or use an expired or revoked certificate or license, shall be
deemed guilty of misdemeanor, and shall, upon conviction, be
sentenced to pay a fine of not less than five hundred pesos but not
more than five thousand pesos. (Emphasis supplied)
41
words as are found in the statute. Verba legis non est recedendum, or
from the words of a statute there should be no departure.42
The wordings of R.A. No. 4566 are clear. It does not declare,
expressly or impliedly, as void contracts entered into by a contractor
whose license had already expired. Nonetheless, such contractor is
liable for payment of the fine prescribed therein. Thus, respondent
should be paid for the projects he completed. Such payment,
however, is without prejudice to the payment of the fine prescribed
under the law.
Besides, Article 22 of the Civil Code which embodies the maxim
Nemo ex alterius incommode debet lecupletari (no man ought to be
made rich out of anothers injury) states:
Art. 22. Every person who through an act of performance by another,
or any other means, acquires or comes into possession of something
at the expense of the latter without just or legal ground, shall return
the same to him.
This article is part of the chapter of the Civil Code on Human
Relations, the provisions of which were formulated as "basic
principles to be observed for the rightful relationship between human
beings and for the stability of the social order, x x x designed to
indicate certain norms that spring from the fountain of good
conscience, x x x guides human conduct [that] should run as golden
threads through society to the end that law may approach its supreme
ideal which is the sway and dominance of justice."43 The rules
thereon apply equally well to the Government.44 Since respondent had
rendered services to the full satisfaction and acceptance by petitioner,
then the former should be compensated for them. To allow petitioner
to acquire the finished project at no cost would undoubtedly
constitute unjust enrichment for the petitioner to the prejudice of
respondent. Such unjust enrichment is not allowed by law.
WHEREFORE, the present petition is DENIED for lack of merit.
The assailed Decision of the Court of Appeals dated April 28, 2003 in
CA-G.R. CV No. 56345 is AFFIRMED. No pronouncement as to
costs.
SO ORDERED.
The "plain meaning rule" or verba legis in statutory construction is

that if the statute is clear, plain and free from ambiguity, it must be
given its literal meaning and applied without interpretation.40 This
rule derived from the maxim Index animi sermo est (speech is the
index of intention) rests on the valid presumption that the words
employed by the legislature in a statute correctly express its intention
or will and preclude the court from construing it differently. The
legislature is presumed to know the meaning of the words, to have
used words advisedly, and to have expressed its intent by use of such
40
G.R. No. 156109
November 18, 2004
KHRISTINE REA M. REGINO, Assisted and Represented by

ARMANDO REGINO, petitioner,
vs.
PANGASINAN COLLEGES OF SCIENCE AND
TECHNOLOGY, RACHELLE A. GAMUROT and ELISSA
BALADAD, respondents.
DECISION
PANGANIBAN, J.:
Upon enrolment, students and their school enter upon a reciprocal
contract. The students agree to abide by the standards of academic
performance and codes of conduct, issued usually in the form of
manuals that are distributed to the enrollees at the start of the school
term. Further, the school informs them of the itemized fees they are
expected to pay. Consequently, it cannot, after the enrolment of a
student, vary the terms of the contract. It cannot require fees other
than those it specified upon enrolment.
The Case
Before the Court is a Petition for Review under Rule 45,1 seeking to
nullify the July 12, 20022 and the November 22, 20023 Orders of the
Regional Trial Court (RTC) of Urdaneta City, Pangasinan (Branch
48) in Civil Case No. U-7541. The decretal portion of the first
assailed Order reads:
"WHEREFORE, the Court GRANTS the instant motion to
dismiss for lack of cause of action."4
The second challenged Order denied petitioner's Motion for
Reconsideration.
The Facts
Financially strapped and prohibited by her religion from attending

dance parties and celebrations, Regino refused to pay for the tickets.
On March 14 and March 15, 2002, the scheduled dates of the final
examinations in logic and statistics, her teachers -- Respondents
Rachelle A. Gamurot and Elissa Baladad -- allegedly disallowed her
from taking the tests. According to petitioner, Gamurot made her sit
out her logic class while her classmates were taking their
examinations. The next day, Baladad, after announcing to the entire
class that she was not permitting petitioner and another student to
take their statistics examinations for failing to pay for their tickets,
allegedly ejected them from the classroom. Petitioner's pleas
ostensibly went unheeded by Gamurot and Baladad, who
unrelentingly defended their positions as compliance with PCST's
policy.
On April 25, 2002, petitioner filed, as a pauper litigant, a
Complaint5 for damages against PCST, Gamurot and Baladad. In her
Complaint, she prayed for P500,000 as nominal damages; P500,000
as moral damages; at least P1,000,000 as exemplary damages;
P250,000 as actual damages; plus the costs of litigation and attorney's
fees.
On May 30, 2002, respondents filed a Motion to Dismiss6 on the
ground of petitioner's failure to exhaust administrative remedies.
According to respondents, the question raised involved the
determination of the wisdom of an administrative policy of the PCST;
hence, the case should have been initiated before the proper
administrative body, the Commission of Higher Education (CHED).
In her Comment to respondents' Motion, petitioner argued that prior
exhaustion of administrative remedies was unnecessary, because her
action was not administrative in nature, but one purely for damages
arising from respondents' breach of the laws on human relations. As
such, jurisdiction lay with the courts.
On July 12, 2002, the RTC dismissed the Complaint for lack of cause
of action.
Ruling of the Regional Trial Court
In granting respondents' Motion to Dismiss, the trial court noted that
the instant controversy involved a higher institution of learning, two
of its faculty members and one of its students. It added that Section
54 of the Education Act of 1982 vested in the Commission on Higher
Education (CHED) the supervision and regulation of tertiary schools.
Thus, it ruled that the CHED, not the courts, had jurisdiction over the
controversy.7
Petitioner Khristine Rea M. Regino was a first year computer science

student at Respondent Pangasinan Colleges of Science and
Technology (PCST). Reared in a poor family, Regino went to college
In its dispositive portion, the assailed Order dismissed the Complaint
mainly through the financial support of her relatives. During the
second semester of school year 2001-2002, she enrolled in logic and for "lack of cause of action" without, however, explaining this
statistics subjects under Respondents Rachelle A. Gamurot and Elissa ground.
Baladad, respectively, as teachers.
Aggrieved, petitioner filed the present Petition on pure questions of
law.8
In February 2002, PCST held a fund raising campaign dubbed the
"Rave Party and Dance Revolution," the proceeds of which were to
go to the construction of the school's tennis and volleyball courts.
Each student was required to pay for two tickets at the price of P100
each. The project was allegedly implemented by recompensing
students who purchased tickets with additional points in their test
scores; those who refused to pay were denied the opportunity to take
the final examinations.
Issues
In her Memorandum, petitioner raises the following issues for our
consideration:
41
"Whether or not the principle of exhaustion of administrative

remedies applies in a civil action exclusively for damages
based on violation of the human relation provisions of the
Civil Code, filed by a student against her former school.
"Whether or not there is a need for prior declaration of
invalidity of a certain school administrative policy by the
Commission on Higher Education (CHED) before a former
student can successfully maintain an action exclusively for
damages in regular courts.
"Whether or not the Commission on Higher Education
(CHED) has exclusive original jurisdiction over actions for
damages based upon violation of the Civil Code provisions
on human relations filed by a student against the school."9
All of the foregoing point to one issue -- whether the doctrine of
exhaustion of administrative remedies is applicable. The Court,
however, sees a second issue which, though not expressly raised by
petitioner, was impliedly contained in her Petition: whether the
Complaint stated sufficient cause(s) of action.
Petitioner is not asking for the reversal of the policies of PCST.

Neither is she demanding it to allow her to take her final
examinations; she was already enrolled in another educational
institution. A reversal of the acts complained of would not adequately
redress her grievances; under the circumstances, the consequences of
respondents' acts could no longer be undone or rectified.
Second, exhaustion of administrative remedies is applicable when
there is competence on the part of the administrative body to act upon
the matter complained of.14 Administrative agencies are not courts;
they are neither part of the judicial system, nor are they deemed
judicial tribunals.15 Specifically, the CHED does not have the power
to award damages.16 Hence, petitioner could not have commenced her
case before the Commission.
Third, the exhaustion doctrine admits of exceptions, one of which
arises when the issue is purely legal and well within the jurisdiction
of the trial court.17 Petitioner's action for damages inevitably calls for
the application and the interpretation of the Civil Code, a function
that falls within the jurisdiction of the courts.18
Second Issue:
The Court's Ruling

Cause of Action
The Petition is meritorious.
First Issue:
Sufficient Causes of Action Stated in the Allegations in the

Complaint
As a rule, every complaint must sufficiently allege a cause of action;

failure to do so warrants its dismissal.19 A complaint is said to assert a
Respondents anchored their Motion to Dismiss on petitioner's alleged sufficient cause of action if, admitting what appears solely on its face
to be correct, the plaintiff would be entitled to the relief prayed for.
failure to exhaust administrative remedies before resorting to the
RTC. According to them, the determination of the controversy hinge Assuming the facts that are alleged to be true, the court should be
able to render a valid judgment in accordance with the prayer in the
on the validity, the wisdom and the propriety of PCST's academic
complaint.20
policy. Thus, the Complaint should have been lodged in the CHED,
the administrative body tasked under Republic Act No. 7722 to
implement the state policy to "protect, foster and promote the right of A motion to dismiss based on lack of cause of action hypothetically
admits the truth of the alleged facts. In their Motion to Dismiss,
all citizens to affordable quality education at all levels and to take
respondents did not dispute any of petitioner's allegations, and they
appropriate steps to ensure that education is accessible to all."10
admitted that "x x x the crux of plaintiff's cause of action is the
Petitioner counters that the doctrine finds no relevance to the present determination of whether21or not the assessment of P100 per ticket is
excessive or oppressive." They thereby premised their prayer for
case since she is praying for damages, a remedy beyond the domain
dismissal on the Complaint's alleged failure to state a cause of action.
of the CHED and well within the jurisdiction of the courts.11
Thus, a reexamination of the Complaint is in order.
Exhaustion of Administrative Remedies
Petitioner is correct. First, the doctrine of exhaustion of

administrative remedies has no bearing on the present case. In
Factoran Jr. v. CA,12 the Court had occasion to elucidate on the
rationale behind this doctrine:
"The doctrine of exhaustion of administrative remedies is
basic. Courts, for reasons of law, comity, and convenience,
should not entertain suits unless the available administrative
remedies have first been resorted to and the proper
authorities have been given the appropriate opportunity to
act and correct their alleged errors, if any, committed in the
administrative forum. x x x.13"
The Complaint contains the following factual allegations:

"10. In the second week of February 2002, defendant
Rachelle A. Gamurot, in connivance with PCST, forced
plaintiff and her classmates to buy or take two tickets each, x
x x;
"11. Plaintiff and many of her classmates objected to the
forced distribution and selling of tickets to them but the said
defendant warned them that if they refused [to] take or pay
the price of the two tickets they would not be allowed at all
to take the final examinations;
"12. As if to add insult to injury, defendant Rachelle A.
Gamurot bribed students with additional fifty points or so in
their test score in her subject just to unjustly influence and
compel them into taking the tickets;
42
"13. Despite the students' refusal, they were forced to take

the tickets because [of] defendant Rachelle A. Gamurot's
coercion and act of intimidation, but still many of them
including the plaintiff did not attend the dance party imposed
upon them by defendants PCST and Rachelle A. Gamurot;
"14. Plaintiff was not able to pay the price of her own two
tickets because aside form the fact that she could not afford
to pay them it is also against her religious practice as a
member of a certain religious congregation to be attending
dance parties and celebrations;
The school-student relationship is also reciprocal. Thus, it has

consequences appurtenant to and inherent in all contracts of such kind
-- it gives rise to bilateral or reciprocal rights and obligations. The
school undertakes to provide students with education sufficient to
enable them to pursue higher education or a profession. On the other
hand, the students agree to abide by the academic requirements of the
school and to observe its rules and regulations.27
The terms of the school-student contract are defined at the moment of
its inception -- upon enrolment of the student. Standards of academic
performance and the code of behavior and discipline are usually set
forth in manuals distributed to new students at the start of every
school year. Further, schools inform prospective enrollees the amount
of fees and the terms of payment.
"15. On March 14, 2002, before defendant Rachelle A.

Gamurot gave her class its final examination in the subject
'Logic' she warned that students who had not paid the tickets
would not be allowed to participate in the examination, for
In practice, students are normally required to make a down payment
which threat and intimidation many students were eventually upon enrollment, with the balance to be paid before every
forced to make payments:
preliminary, midterm and final examination. Their failure to pay their
financial obligation is regarded as a valid ground for the school to
deny them the opportunity to take these examinations.
"16. Because plaintiff could not afford to pay, defendant
Rachelle A. Gamurot inhumanly made plaintiff sit out the
class but the defendant did not allow her to take her final
The foregoing practice does not merely ensure compliance with
examination in 'Logic;'
financial obligations; it also underlines the importance of major
examinations. Failure to take a major examination is usually fatal to
the students' promotion to the next grade or to graduation.
"17. On March 15, 2002 just before the giving of the final
Examination results form a significant basis for their final grades.
examination in the subject 'Statistics,' defendant Elissa
These tests are usually a primary and an indispensable requisite to
Baladad, in connivance with defendants Rachelle A.
their elevation to the next educational level and, ultimately, to their
Gamurot and PCST, announced in the classroom that she
completion of a course.
was not allowing plaintiff and another student to take the
examination for their failure and refusal to pay the price of
the tickets, and thenceforth she ejected plaintiff and the other Education is not a measurable commodity. It is not possible to
student from the classroom;
determine who is "better educated" than another. Nevertheless, a
student's grades are an accepted approximation of what would
otherwise be an intangible product of countless hours of study. The
"18. Plaintiff pleaded for a chance to take the examination
but all defendants could say was that the prohibition to give importance of grades cannot be discounted in a setting where
education is generally the gate pass to employment opportunities and
the examinations to non-paying students was an
better life; such grades are often the means by which a prospective
administrative decision;
employer measures whether a job applicant has acquired the
necessary tools or skills for a particular profession or trade.
"19. Plaintiff has already paid her tuition fees and other
obligations in the school;
Thus, students expect that upon their payment of tuition fees,

"20. That the above-cited incident was not a first since PCST satisfaction of the set academic standards, completion of academic
also did another forced distribution of tickets to its students requirements and observance of school rules and regulations, the
school would reward them by recognizing their "completion" of the
in the first semester of school year 2001-2002; x x x " 22
course enrolled in.
The foregoing allegations show two causes of action; first, breach of
contract; and second, liability for tort.
Reciprocity of the
School-Student Contract
In Alcuaz v. PSBA,23 the Court characterized the relationship between
the school and the student as a contract, in which "a student, once
admitted by the school is considered enrolled for one
semester."24 Two years later, in Non v. Dames II,25 the Court modified
the "termination of contract theory" in Alcuaz by holding that the
contractual relationship between the school and the student is not
only semestral in duration, but for the entire period the latter are
expected to complete it."26 Except for the variance in the period
during which the contractual relationship is considered to subsist,
both Alcuaz and Non were unanimous in characterizing the schoolstudent relationship as contractual in nature.
The obligation on the part of the school has been established in

Magtibay v. Garcia,28 Licup v. University of San Carlos29 and Ateneo
de Manila University v. Garcia,30 in which the Court held that, barring
any violation of the rules on the part of the students, an institution of
higher learning has a contractual obligation to afford its students a
fair opportunity to complete the course they seek to pursue.
We recognize the need of a school to fund its facilities and to meet
astronomical operating costs; this is a reality in running it. Crystal v.
Cebu International School31 upheld the imposition by respondent
school of a "land purchase deposit" in the amount of P50,000 per
student to be used for the "purchase of a piece of land and for the
construction of new buildings and other facilities x x x which the
school would transfer [to] and occupy after the expiration of its lease
contract over its present site."
43
The amount was refundable after the student graduated or left the
school. After noting that the imposition of the fee was made only after
prior consultation and approval by the parents of the students, the
Court held that the school committed no actionable wrong in refusing
to admit the children of the petitioners therein for their failure to pay
the "land purchase deposit" and the 2.5 percent monthly surcharge
thereon.
"Article 19. Every person must, in the exercise of his rights

and in the performance of his duties, act with justice, give
everyone his due, and observe honesty and good faith."
In the present case, PCST imposed the assailed revenue-raising

measure belatedly, in the middle of the semester. It exacted the dance
party fee as a condition for the students' taking the final examinations,
and ultimately for its recognition of their ability to finish a course.
The fee, however, was not part of the school-student contract entered
into at the start of the school year. Hence, it could not be unilaterally
imposed to the prejudice of the enrollees.
"Article 26. Every person shall respect the dignity,

personality, privacy and peace of mind of his neighbors and
other persons. The following and similar acts, though they
may not constitute a criminal offense, shall produce a cause
of action for damages, prevention and other relief:
Such contract is by no means an ordinary one. In Non, we stressed

that the school-student contract "is imbued with public interest,
considering the high priority given by the Constitution to education
and the grant to the State of supervisory and regulatory powers over
all educational institutions."32 Sections 5 (1) and (3) of Article XIV of
the 1987 Constitution provide:
"The State shall protect and promote the right of all citizens
to quality education at all levels and shall take appropriate
steps to make such declaration accessible to all.
"Article 21. Any person who wilfully causes loss or injury to

another in a manner that is contrary to morals, good customs
or public policy shall compensate the latter for the damage."
(1) Prying into the privacy of another's residence;

(2) Meddling with or disturbing the private life or
family relations of another;
(3) Intriguing to cause another to be alienated from
his friends;
(4) Vexing or humiliating another on account of his
beliefs, lowly station in life, place of birth, physical
defect, or other personal condition."
"Every student has a right to select a profession or course of Generally, liability for tort arises only between parties not otherwise
study, subject to fair, reasonable and equitable admission and bound by a contract. An academic institution, however, may be held
liable for tort even if it has an existing contract with its students, since
academic requirements."
the act that violated the contract may also be a tort. We ruled thus in
PSBA vs. CA,34 from which we quote:
The same state policy resonates in Section 9(2) of BP 232, otherwise
known as the Education Act of 1982:
"x x x A perusal of Article 2176 [of the Civil Code] shows
that obligations arising from quasi-delicts or tort, also known
"Section 9. Rights of Students in School. In addition to
as extra-contractual obligations, arise only between parties
other rights, and subject to the limitations prescribed by law
not otherwise bound by contract, whether express or
and regulations, students and pupils in all schools shall enjoy
implied. However, this impression has not prevented this
the following rights:
Court from determining the existence of a tort even when
there obtains a contract. In Air France v. Carrascoso (124
xxx
xxx
xxx
Phil. 722), the private respondent was awarded damages for
his unwarranted expulsion from a first-class seat aboard the
(2) The right to freely choose their field of study
petitioner airline. It is noted, however, that the Court referred
subject to existing curricula and to continue their
to the petitioner-airline's liability as one arising from tort,
course therein up to graduation, except in cases of
not one arising form a contract of carriage. In effect, Air
academic deficiency, or violation of disciplinary
France is authority for the view that liability from tort may
regulations."
exist even if there is a contract, for the act that breaks the
contract may be also a tort. x x x This view was not all that
revolutionary, for even as early as 1918, this Court was
Liability for Tort
already of a similar mind. In Cangco v. Manila Railroad (38
Phil. 780), Mr. Justice Fisher elucidated thus: 'x x x. When
In her Complaint, petitioner also charged that private respondents
such a contractual relation exists the obligor may break the
"inhumanly punish students x x x by reason only of their poverty,
contract under such conditions that the same act which
religious practice or lowly station in life, which inculcated upon
constitutes a breach of the contract would have constituted
33
[petitioner] the feelings of guilt, disgrace and unworthiness;" as a
the source of an extra-contractual obligation had no contract
result of such punishment, she was allegedly unable to finish any of
existed between the parties.'
her subjects for the second semester of that school year and had to lag
behind in her studies by a full year. The acts of respondents
supposedly caused her extreme humiliation, mental agony and
"demoralization of unimaginable proportions" in violation of Articles
19, 21 and 26 of the Civil Code. These provisions of the law state
thus:
"Immediately what comes to mind is the chapter of the Civil

Code on Human Relations, particularly Article 21 x x x."35
Academic Freedom
44
In their Memorandum, respondents harp on their right to "academic

freedom." We are not impressed. According to present jurisprudence,
academic freedom encompasses the independence of an academic
institution to determine for itself (1) who may teach, (2) what may be
taught, (3) how it shall teach, and (4) who may be admitted to
study.36 In Garcia v. the Faculty Admission Committee, Loyola
School of Theology,37 the Court upheld the respondent therein when it
denied a female student's admission to theological studies in a
seminary for prospective priests. The Court defined the freedom of an
academic institution thus: "to decide for itself aims and objectives and
how best to attain them x x x free from outside coercion or
interference save possibly when overriding public welfare calls for
some restraint."38
40
not be used to discriminate against certain students. After accepting

them upon enrollment, the school cannot renege on its contractual
obligation on grounds other than those made known to, and accepted
by, students at the start of the school year.
In sum, the Court holds that the Complaint alleges sufficient causes
of action against respondents, and that it should not have been
summarily dismissed. Needless to say, the Court is not holding
respondents liable for the acts complained of. That will have to be
ruled upon in due course by the court a quo.
WHEREFORE, the Petition is hereby GRANTED, and the assailed
Orders REVERSED. The trial court is DIRECTED to reinstate the
Complaint and, with all deliberate speed, to continue the proceedings
in Civil Case No. U-7541. No costs.
In Tangonan v. Pao,39 the Court upheld, in the name of academic

freedom, the right of the school to refuse readmission of a nursing
student who had been enrolled on probation, and who had failed her
SO ORDERED.
nursing subjects. These instances notwithstanding, the Court has
emphasized that once a school has, in the name of academic freedom,
set its standards, these should be meticulously observed and should
45

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Administrative Law 5

G.R. No. 179844

March 23, 2011

(sic) Romualdez are absolute and lawful owners of separate parcels of

Sotela Adea, et al.

June 30, 1994

It was only in 1998 when the complainants learned of the issuance of

The Complainants pointed out that while the Defendants respective

respective landholdings; cancellation of the CLOAs and payment of

public domain as agricultural land and declares the same alienable

1. Sustaining the validity of the subject Certificates of Land

WHEREFORE, premises considered, judgment is hereby rendered:

1. Ordering the cancellation of the Certificate of Land

2. Ordering the Register of Deeds of Siniloan, Laguna to

2. Ordering the Register of Deeds of Siniloan, Laguna to

Aggrieved, petitioners appealed to the DARAB.

Both parties filed their respective Motions for Reconsideration. The

WHEREFORE, premises considered, the appealed decision is hereby

WHEREFORE, premises considered, private respondents Motion for

The Honorable Court of Appeals has no basis in

seek recourse from the Office of the Department of Agrarian Reform

However, this Court refuses to rule on the validity of the CARP

G.R. No. 174674

October 20, 2010

NESTLE PHILIPPINES, INC. and NESTLE WATERS

On 11 October 2001, the Interim Receivership Committee filed in the

The Ruling of the Court of Appeals

In its assailed 10 January 2006 Decision, the Court of Appeals denied

On 25 June 1999, respondents filed in the Securities and Exchange

Petitioners moved for reconsideration. They also filed a supplemental

The Court's Ruling

Respondents moved for reconsideration of the 30 July 2009 and the

As found by the SEC, several factors prevented the realization of the

On 22 January 2010, respondents filed another petition appealing the

On 11 July 2007, the rehabilitation receiver filed in the SEC a Third

Meanwhile, on 27 April 2010, the SEC en banc issued an Order

A majority of the secured creditors strongly opposed the revised

Finally, in its 30 September 2010 Order, the SEC consolidated

G.R. No. 138381

April 16, 2002

GOVERNMENT SERVICE INSURANCE SYSTEM, petitioner,

x x x While it is true that R.A. 6758 and Corporate

On February 26, 1993, Mr. Julio Navarrete, Vice-President of the

(d) Upon the recommendation of the President and General

Pursuant thereto, the GSIS Board of Trustees may validly increase

On August 25, 1998, the COA affirmed the disallowances made by

FOR RECONSIDERATION DESPITE THE

Meanwhile, the De Jesus case mentioned in G.R. No. 138381 was

On January 14, 1999, the retirees filed a motion for summary

IN THE LIGHT OF ALL THE FOREGOING, the Petition is

exempts GSIS from Office of the Compensation and Position

regardless of the increase in basic salary. It was postulated therein

P3,000.00 by virtue of GSIS Board Resolution No. 29431 dated July

Thus, to peg the amount of these non-integrated allowances at the

As stated earlier, the payment of premiums for group personnel

As stated earlier, the power of the GSIS Board to "establish, fix,

However, as pointed out by petitioner GSIS, CCC No. 10 was

than that. And why not, when it tends to deprive government

P500.00 to P15,000.00 according to the number of years of

Petitioner GSIS did not squarely address the above finding of

However, considering that it has already been resolved in G.R. No.

G.R. No. 180388

January 18, 2011