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Article IX, Section 2 (1) of the 1987 Constitution

FIRST DIVISION
provides:
[G.R. No. 98107. August 18, 1997]
‘The civil service embraces all branches,
BENJAMIN C. JUCO, petitioner, vs. NATIONAL subdivisions, instrumentalities and agencies of
LABOR RELATIONS COMMISSION and NATIONAL the government, including government owned
HOUSING CORPORATION, respondents. and controlled corporations with original charters.’
DECISION (underscoring supplied)

HERMOSISIMA, JR., J.: From the aforequoted constitutional provision, it is


clear that respondent NHC is not within the scope
This is a petition for certiorari to set aside the of the civil service and is therefore beyond the
Decision of the National Labor Relations jurisdiction of this board. Moreover, it is pertinent
Commission (NLRC) dated March 14, 1991, which to state that the 1987 Constitution was ratified
reversed the Decision dated May 21, 1990 of and became effective on February 2, 1987.
Labor Arbiter Manuel R. Caday, on the ground of
lack of jurisdiction. WHEREFORE, for lack of jurisdiction, the instant
complaint is hereby dismissed.”
Petitioner Benjamin C. Juco was hired as a project
engineer of respondent National Housing On April 28, 1989, petitioner filed with respondent
Corporation (NHC) from November 16, 1970 to NLRC a complaint for illegal dismissal with
May 14, 1975. On May 14, 1975, he was preliminary mandatory injunction against
separated from the service for having been respondent NHC.
implicated in a crime of theft and/or malversation On May 21, 1990, respondent NLRC thru Labor
of public funds. Arbiter Manuel R. Caday ruled that petitioner was
On March 25, 1977, petitioner filed a complaint illegally dismissed from his employment by
for illegal dismissal against the NHC with the respondent as there was evidence in the record
Department of Labor. that the criminal case against him was purely
fabricated, prompting the trial court to dismiss the
On September 17, 1977, the Labor Arbiter charges against him. Hence, he concluded that
rendered a decision dismissing the complaint on the dismissal was illegal as it was devoid of basis,
the ground that the NLRC had no jurisdiction over legal or factual.
the case.
He further ruled that the complaint is not barred
Petitioner then elevated the case to the NLRC by prescription considering that the period from
which rendered a decision on December 28, 1982, which to reckon the reglementary period of four
reversing the decision of the Labor Arbiter. years should be from the date of the receipt of
Dissatisfied with the decision of the NLRC, the decision of the Civil Service Commission
respondent NHC appealed before this Court and promulgated on April 11, 1989. He also
on January 17, 1985, we rendered a decision, the ratiocinated that:
dispositive portion thereof reads as follows: “It appears x x x complainant filed the complaint
“WHEREFORE, the petition is hereby GRANTED. for illegal dismissal with the Civil Service
The questioned decision of the respondent Commission on January 6, 1989 and the same was
National Labor Relations Commission is SET dismissed on April 11, 1989 after which on April
ASIDE. The decision of the Labor Arbiter 28, 1989, this case was filed by the complainant.
dismissing the case before it for lack of Prior to that, this case was ruled upon by the
jurisdiction is REINSTATED.” Supreme Court on January 17, 1985 which
enjoined the complainant to go to the Civil Service
On January 6, 1989, petitioner filed with the Civil Commission which in fact, complainant did.
Service Commission a complaint for illegal Under the circumstances, there is merit on the
dismissal, with preliminary mandatory injunction. contention that the running of the reglementary
On February 6, 1989, respondent NHC moved for period of four (4) years was suspended with the
the dismissal of the complaint on the ground that filing of the complaint with the said Commission.
the Civil Service Commission has no jurisdiction Verily, it was not the fault of the respondent for
over the case. failing to file the complaint as alleged by the
respondent but due to, in the words of the
On April 11, 1989, the Civil Service Commission
complainant, a ‘legal knot’ that has to be
issued an order dismissing the complaint for lack
untangled.”
of jurisdiction. It ratiocinated that:
Thereafter, the Labor Arbiter rendered a decision,
“The Board finds the comment and/or motion to
the dispositive portion of which reads:
dismiss meritorious. It was not disputed that NHC
is a government corporation without an original "Premises considered, judgment is hereby
charter but organized/created under the rendered declaring the dismissal of the
Corporate Code. complainant as illegal and ordering the
respondent to immediately reinstate him to his governs because it is the Constitution in place at
former position without loss of seniority rights the time of the decision. Furthermore, we ruled
with full back wages inclusive of allowance and to that the new phrase “with original charter” means
his other benefits or equivalent computed from that government-owned and controlled
the time it is withheld from him when he was corporations refer to corporations chartered by
dismissed on March 27, 1977, until actually special law as distinguished from corporations
reinstated.” organized under the Corporation Code. Thus,
NASECO which had been organized under the
On June 1, 1990, respondent NHC filed its appeal
general incorporation stature and a subsidiary of
before the NLRC and on March 14, 1991, the
the National Investment Development
NLRC promulgated a decision which reversed the
Corporation, which in turn was a subsidiary of the
decision of Labor Arbiter Manuel R. Caday on the
Philippine National Bank, is excluded from the
ground of lack of jurisdiction.
purview of the Civil Service Commission.
The primordial issue that confronts us is whether
We see no cogent reason to depart from the
or not public respondent committed grave abuse
ruling in the aforesaid case.
of discretion in holding that petitioner is not
governed by the Labor Code. In the case at bench, the National Housing
Corporation is a government owned corporation
Under the laws then in force, employees of
organized in 1959 in accordance with Executive
government-owned and /or controlled
Order No. 399, otherwise known as the Uniform
corporations were governed by the Civil Service
Law and not by the Labor Code. Hence, Charter of Government Corporation, dated
January 1, 1959. Its shares of stock are and have
Article 277 of the Labor Code (PD 442) then been one hundred percent (100%) owned by the
provided: Government from its incorporation under Act
"The terms and conditions of employment of all 1459, the former corporation law. The
government employees, including employees of government entities that own its shares of stock
government-owned and controlled corporations are the Government Service Insurance System,
shall be governed by the Civil Service Law, rules the Social Security System, the Development
and regulations x x x.” Bank of the Philippines, the National Investment
and Development Corporation and the People’s
The 1973 Constitution, Article II-B, Section 1(1), Homesite and Housing Corporation. Considering
on the other hand provided: the fact that the NHA had been incorporated
“The Civil Service embraces every branch, under act 1459, the former corporation law, it is
agency, subdivision and instrumentality of the but correct to say that it is a government-owned
government, including government-owned or or controlled corporation whose employees are
controlled corporations.” subject to the provisions of the Labor Code. This
observation is reiterated in recent case of Trade
Although we had earlier ruled in National Housing Union of the Philippines and Allied Services
Corporation v. Juco, that employees of (TUPAS) v. National Housing Corporation, where
government-owned and/or controlled we held that the NHA is now within the jurisdiction
corporations, whether created by special law or of the Department of Labor and Employment, it
formed as subsidiaries under the general being a government-owned and/or controlled
Corporation Law, are governed by the Civil corporation without an original charter.
Service Law and not by the Labor Code, this ruling Furthermore, we also held that the workers or
has been supplanted by the 1987 Constitution. employees of the NHC (now NHA) undoubtedly
Thus, the said Constitution now provides: have the right to form unions or employee’s
“The civil service embraces all branches, organization and that there is no impediment to
subdivision, instrumentalities, and agencies of the the holding of a certification election among them
Government, including government owned or as they are covered by the Labor Code.
controlled corporations with original charter.” Thus, the NLRC erred in dismissing petitioner’s
(Article IX-B, Section 2[1]) complaint for lack of jurisdiction because the rule
In National Service Corporation (NASECO) v. now is that the Civil Service now covers only
National Labor Relations Commission, we had the government-owned or controlled corporations
occasion to apply the present Constitution in with original charters. Having been incorporated
deciding whether or not the employees of under the Corporation Law, its relations with its
NASECO are covered by the Civil Service Law or personnel are governed by the Labor Code and
the Labor Code notwithstanding that the case come under the jurisdiction of the National Labor
arose at the time when the 1973 Constitution was Relations Commission.
still in effect. We ruled that the NLRC has One final point. Petitioners have been tossed
jurisdiction over the employees of NASECO on the from one forum to another for a simple illegal
ground that it is the 1987 Constitution that
dismissal case. It is but apt that we put an end to CSC all appointments in the Economic Intelligence
his dilemma in the interest of justice. and Investigation Bureau (EIIB).
WHEREFORE, the decision of the NLRC in NLRC Instead of complying with the said letter,
NCR-04-02036089 dated March 14, 1991 is petitioner Jose T. Almonte, as Commissioner of
hereby REVERSED and the Decision of the Labor EIIB, wrote a letter dated March 29, 1989, to
Arbiter dated May 21, 1990 is REINSTATED. respondent CSC, requesting for confirmation of
EIIB's exemption from CSC rules and regulations
SO ORDERED.
with respect to appointments and other personnel
Padilla, (Chairman), Bellosillo, Vitug, and actions invoking as basis for such exemption PD
Kapunan, JJ., concur. No. 1458 and LOI No. 71.
Rollo, pp. 20-21. On June 21, 1989, respondent CSC issued the
Id., pp. 22-26. subject Resolution No. 89-400, denying petitioner
Almonte's request for exemption of the EIIB from
Id., pp. 27-37. the coverage of the civil service rules and
Id., pp. 38-42. regulations and reiterating its order that
petitioner EIIB submit to the CSC all appointments
Id., pp. 43-47. to career or non-career positions in the Bureau.
Id., p. 52. Not having received any compliance from
Id., pp. 53-58. petitioners, respondent CSC, in its Order of
December 7, 1990, directed petitioner Jose T.
Id., p. 68.
Almonte to immediately implement Resolution No.
Id., p. 69. 89-400, with a warning that any EIIB official who
Id., pp. 78-86. shall fail or refuse to comply with the said order
shall be held liable for indirect contempt.
134 SCRA 172 (1985).
On June 4, 1991, respondent CSC issued another
168 SCRA 122 [1988]. order, requiring petitioner Almonte to Show cause
National Housing Corporation vs. Juco, 134 SCRA why he should not be cited for indirect contempt
172 (1985). for his continued refusal to implement or comply
with CSC Resolution No. 89-400 and the Order of
173 SCRA 33 (1989). December 7, 1990.
PNOC-Energy Development Corporation v. NLRC, In a letter, dated June 13, 1991, petitioner
201 SCRA 487 1991 The NHC (now NHA) Almonte explained to the respondent CSC the
Republic of the Philippines reasons of the EIIB for its inability to comply with
SUPREME COURT Resolution No. 89-400. He invoked PD No. 1458
Manila and LOI No. 71 exempting the EIIB from the
coverage of civil service rules and regulations on
EN BANC
appointments and other personnel actions.
Petitioner Almonte prayed that Resolution No. 89-
G.R. No. 129133 November 25, 1998 400, the Order of June 4, 1991, and the
subsequent orders be set aside.
ECONOMIC INTELLIGENCE AND
INVESTIGATION BUREAU, petitioner, On August 22, 1991, respondent CSC issued an
vs. order, finding petitioner Almonte guilty of indirect
HON. COURT OF APPEALS and CIVIL SERVICE contempt of the Commission, the dispositive
COMMISSION, respondents. portion of which reads as follows:
WHEREFORE, foregoing premises considered, the
commission hereby resolves to find and adjudge
PURISIMA, J.: Jose T. Almonte, Commissioner, EIIB, guilty of
Before the Court is a Petition for Review on indirect contempt of the Commission pursuant to
Certiorari under Rule 45 of the Revised Rules of Section 12 (11), Book V, Subtitle A of Executive
Court to review and set aside the 7 November order No. 292 and memorandum Circular No. 42,
1996 Decision 1 and 18 March 1997 Resolution 2 of series of 1990. He is thus meted the penalty of
the Court of Appeals 3 in CA- G.R. SP No. 37720. fine P1,000.00 each day from the date of receipt
of this Order dated December 7, 1990.
As culled by the Court of Appeals, the antecedent Accordingly, the Cashier of the EIIB is hereby
facts that matter are, as follows: directed to deduct from the salary of
In a letter dated October 13, 1988, respondent Commissioner Almonte the amount of P1,000.00
CSC through Chairman Patricia A. Sto. Tomas each day of his failure to comply with the above
required the Secretary of Finance to submit to the CSC Order. Let copies of this Order be furnished
the Resident Auditor of the EIIB as well as the
COA, the Secretary of the Department of Finance NULL AND VOID, the Civil Service Commission not
and the CSFO-DND, for their information and having jurisdiction to cite and punish
guidance. Commissioner Jose T. Almonte of the Economic
Intelligence and Investigation Bureau for indirect
SO ORDERED.
contempt of the Commission.
Dissatisfied therewith, petitioner went to the
With the denial of its motion for reconsideration
Court of Appeals on a Petition for Certiorari.
by Resolution, dated March 18, 1997, of the Court
However, on November 7, 1996, the Court of
of Appeals, petitioner found its way to this Court
Appeals dismissed the petition; ratiocinating thus:
via the present Petition; contending, that:
The 1987 Constitution is so clear and categorical
IN HOLDING THAT PETITIONER IS COVERED BY
in its mandate that:
CIVIL SERVICE, RESPONDENT COURT VIOLATED
Art. IX (B), Section 2 (1). — The civil service P.D. No. 1458 AND LOI No. 71 WHICH EXPRESSLY
embraces all branches, subdivisions, EXEMPT IT FROM CIVIL SERVICE COVERAGE.
instrumentalities, and agencies of the
The pivotal issue here is: whether or not the
Government, including government-owned or
petitioner, Economic Intelligence Investigation
controlled corporations with original charters.
Bureau (EIIB), is embraced by the Civil Service.
The civil service contemplated in the
Sec. 2, subparagraph (1), Article IX, paragraph (B)
constitutional provision is very comprehensive in
of the 1987 Constitution provides:
its scope, that it includes every category of officer
or employee of the government, its branches, The civil service embraces all branches,
subdivisions and instrumentalities, and even subdivisions, instrumentalities, agencies of the
employees of private corporations, if such Government, including government-owned or
corporations are controlled or owned by the controlled corporations with original charter.
government with original charters. Succinct and clear is the provision of the
In the light of his constitutional mandate, Constitution in point that all government
petitioner EIIB, being a government agency, is agencies, without exception, are covered by the
necessarily embraced by the civil service. The fact civil service.
that positions in the EIIB are primarily confidential Petitioner EIIB is a government agency under the
did not place it outside the domain of civil Department of Finance as provided by Section 17,
servants, since "it is conceded that one holding in Chapter 4, Title II, Book IV of the 1987
the Government a primarily confidential position Administrative Code. 4 Therefore, EIIB is within the
is in the Civil Service" (Ingles v. Mutuc, 26 SCRA ambit of the Civil Service Law.
171). That fact merely exempts confidential
positions in the EIIB from the constitutional rule The civil service within the contemplation of the
that "appointments in the civil service shall be aforecited constitutional provision is
made only according to merit and fitness to be comprehensive in scope. It embraces all officers
determined, as far as practicable . . . by and employees of the government, its branches,
competitive examination [Art. IX (B), Sec. 2 (2) ]". subdivisions and instrumentalities. Even
And it is in this sense that the provisions of PD employees of corporations owned or controlled by
1458, particularly Section 5 and LOI 71 relied the government, with original charters, are
upon by the petitioners should be interpreted. covered thereby.
Neither does petitioners' contention that "if EIIB's Petitioner contends that EIIB is expressly
positions and personnel actions will be opened, exempted from civil service coverage, under
one may know its operations, movements, Section 5 of P.D. No. 1458, which provides:
targets, strategies, and tactics and the whole of Application of WAPCO and Civil Service Rules —
its being" deserve merit, as the same is pure Personnel of the FDIIB shall be exempted from
speculation and conjecture. EIIB officials and WAPCO and Civil Service Rules and Regulations
personnel remain civil servants and as correctly relative to appointments and other personnel
argued by the Solicitor General, "EIIB officials actions: Provided, That they shall be entitled to
occupying confidential positions, remain the benefits and privileges accorded to
accountable to the people and are subject to the government employees . . .
same state policies on morale, efficiency,
integrity, responsiveness and courtesy in the civil On the other hand, LOI No. 71, the Implementing
service". Thus We hold that the personnel in the Rules of P.D. No. 1458, reads:
EEIB are covered by the Civil Service. 10. It is further directed that personnel of the BII
xxx xxx xxx shall be exempt from OCPC and Civil Service
Rules and Regulations relative to appointments
WHEREFORE, the Court upholds Resolution No. and other personnel actions; Provided, That they
89-400 but declares CSC Orders of December 7, shall be entitled to the benefits accorded to
1990, June 4, 1991, and of August 22, 1991, as government employees . . .
Petitioner's submission is barren of merit. production, no similar excuse can be made for a
privilege resting on other considerations.
The aforecited provisions of law provide for the
exemption of petitioner EIIB only from Civil Nor has our attention been called to any law or
Service Rules and Regulations relative to regulation which considers records of the EIIB as
appointments and other personnel actions, but classified information . . .
not from the Civil Service Law or Civil Service All things viewed in proper perspective, we are of
Rules and Regulations relative to any other the opinion, and so hold, that the Court of Appeals
matter. erred not in holding that:
Neither can we uphold petitioner's reliance on . . . [R]espondent CSC's act of requiring petitioner
Section 26 of Executive Order No. 127, 5 EIIB to submit to it all appointments in the
Petitioner, in gist, asserts exemption from Civil Bureau, for appropriate action, is part of its
Service coverage since the Bureau forms part of administrative function as the central personnel
the intelligence community created under the agency of the government.
said executive Order.
WHEREFORE, the petition is hereby DENIED; and
There is merit in the disquisition by the Court of the Decision of the Court of Appeals in CA-GR SP
Appeals that membership of petitioner EIIB in the No. 37720 AFFIRMED, without any pronouncement
intelligence community is of no moment, insofar as to costs.
as application of the Civil Service Law is
concerned. The National Bureau of Investigation SO ORDERED.
(NBI), also a member of the intelligence Narvasa, C.J., Davide, Jr., Romero, Bellosillo, Melo,
community which performs functions similar to Puno, Vitug, Kapunan, Mendoza, Panganiban,
those of EIIB, e.g., intelligence gathering, Martinez, Quisumbing and Pardo, JJ., concur.
investigation, research, etc., submits to the Civil
Service Commission the appointments of all NBI Footnotes
personnel, whether belonging to the career or 1 "Annex A," Petition; Rollo, pp. 12-25.
non-career service. Besides, in Ingles vs. Mutuc,
26 SCRA 171, this Court ruled that " . . . one 2 "Annex B, "Petition; Rollo, pp. 26-27.
holding in the Government a primarily confidential 3 Eighth Division composed of Justices Jaime M.
position is 'in the Civil Service'." Lantin (Chairman and the Ponente), Lourdes K.
Tayao-Jaguros and B.A. Adefuin-De La Cruz
Equally untenable is petitioner's contention that,
because the personnel of EIIB are occupying jobs (Members).
highly confidential in nature, the EIIB should not 4 Sec. 26, E.O. No. 127 reads. as follows:
be required to submit the names of its personnel
"Economic Intelligence and Investigation Bureau
to the Civil Service Commission. — The Economic Intelligence and Investigation
In Almonte vs. Vasquez, 244 SCRA 286 [1995], Bureau, which shall be headed by and subject to
EIIB was ordered by the Ombudsman to produce the supervision and control of the Commissioner
documents relating to personnel services and who shall be appointed by the President upon the
salary vouchers of EIIB employees. The Bureau recommendation of the Minister, shall have the
pleaded that such documents are classified, and following functions:
knowledge of EIIB's documents relative to its (1) Receive, gather and evaluate intelligence
Personnel Services Funds and its plantilla will
reports and information and evidence on the
inevitably lead to knowledge of its operations, nature, modes and extent of illegal activities
movements, targets and strategies, which could
affecting the national economy, such as, but not
destroy the Bureau itself. The Court ruled that the limited to, economic sabotage, smuggling, tax
required documents can be examined by the
evasion, and dollar-salting, investigate the same
Ombudsman; explaining that: and aid in the prosecution of cases;
. . . [T]here is no claim that military or diplomatic
(2) Coordinate with external agencies in
secrets will be disclosed by the production of monitoring the financial and economic activities of
records pertaining to the personnel of the EIIB.
persons or entities, whether domestic or foreign,
Indeed, EIIB's function is the gathering and which may adversely affect national financial
evaluation of intelligence reports and information
interest with the goal of regulating, controlling or
regarding "illegal activities affecting the national preventing said activities;
economy, such as, but not limited to, economic
sabotage, smuggling, tax evasion, dollar salting." (3) Provide all intelligence units of operating
Consequently, while in cases which involve state Bureaus or Offices under the Ministry with the
secrets it may be sufficient to determine from the general framework and guidelines in the conduct
circumstance of the case that there is reasonable of intelligence and investigation works;
danger that compulsion of the evidence will
expose military matters without compelling
(4) Supervise, monitor and coordinate all the service commencing from 1980. A recourse by
intelligence and investigation operations of the petitioner to the Civil Service Commission yielded
operating Bureaus and Offices under the Ministry; negative results. 1 Her letter for reconsideration
dated 25 April 1989 pleaded thus:
(5) Investigate, hear and file upon clearance by
the Minister, anti-graft and corruption cases xxx xxx xxx
against personnel of the Ministry and its With due respect, I think the interpretation of the
constituent units; Honorable Commissioner of RA 6683 does not
(6) Perform such other appropriate functions as conform with the beneficent purpose of the law.
may be assigned by the Minister or his deputies. The law merely requires that a government
employee whether regular, temporary,
5 See Footnote No. 4; same provision of Section
emergency, or casual, should have two
17, Chapter 4, Title II, Book IV of the 1987
consecutive years of government service in order
Administrative Code.
to be entitled to its benefits. I more than meet the
Republic of the Philippines requirement. Persons who are not entitled are
SUPREME COURT consultants, experts and contractual(s). As to the
Manila budget needed, the law provides that the
EN BANC Department of Budget and Management will
shoulder a certain portion of the benefits to be
allotted to government corporations. Moreover,
G.R. No. 88979 February 7, 1992 personnel of these NIA special projects art entitled
to the regular benefits, such (sic) leaves,
LYDIA O. CHUA, petitioner, compulsory retirement and the like. There is no
vs. reason why we should not be entitled to RA 6683.
THE CIVIL SERVICE COMMISSION, THE
NATIONAL IRRIGATION ADMINISTRATION and xxx xxx xxx 2

THE DEPARTMENT OF BUDGET AND Denying the plea for reconsideration, the Civil
MANAGEMENT, respondents. Service Commission (CSC) emphasized:
xxx xxx xxx
PADILLA, J.: We regret to inform you that your request cannot
Pursuant to the policy of streamlining and be granted. The provision of Section 3.1 of Joint
trimming the bureaucracy, Republic Act No. 6683 DBM-CSC Circular Letter No. 89-1 does not only
was approved on 2 December 1988 providing for require an applicant to have two years of
benefits for early retirement and voluntary satisfactory service on the date of
separation from the government service as well separation/retirement but further requires said
as for involuntary separation due to applicant to be on a casual, emergency,
reorganization. Deemed qualified to avail of its temporary or regular employment status as of
benefits are those enumerated in Sec. 2 of the December 2, 1988, the date of enactment of R.A.
Act, as follows: 6683. The law does not contemplate contractual
employees in the coverage.
Sec. 2. Coverage. — This Act shall cover all
appointive officials and employees of the National Inasmuch as your employment as of December
Government, including government-owned or 31, 1988, the date of your separation from the
controlled corporations with original charters, as service, is co-terminous with the NIA project which
well as the personnel of all local government is contractual in nature, this Commission shall
units. The benefits authorized under this Act shall sustain its original decision.
apply to all regular, temporary, casual and xxx xxx xxx 3
emergency employees, regardless of age, who
have rendered at least a total of two (2) In view of such denial, petitioner is before this
consecutive years of government service as of the Court by way of a special civil action for certiorari,
date of separation. Uniformed personnel of the insisting that she is entitled to the benefits
Armed Forces of the Philippines including those of granted under Republic Act No. 6683. Her
the PC-INP are excluded from the coverage of this arguments:
Act. It is submitted that R.A. 6683, as well as Section
Petitioner Lydia Chua believing that she is 3.1 of the Joint DBM-CSC Circular Letter No. 89-1
qualified to avail of the benefits of the program, requires an applicant to be on a casual,
filed an application on 30 January 1989 with emergency, temporary or regular employment
respondent National Irrigation Administration status. Likewise, the provisions of Section 23 (sic)
(NIA) which, however, denied the same; instead, of the Joint DBM-CSC Circular Letter No. 88-1,
she was offered separation benefits equivalent to implementing guidelines of R.A. No. 6683,
one half (1/2) month basic pay for every year of provides:
"2.3 Excluded from the benefits under R.A. No. 2. Petitioner is not a regular and career employee
6683 are the following: of NIA — her position is not included in its regular
plantilla. She belongs to the non-career service
a) Experts and Consultants hired by agencies for a
(Sec. 6, P.D. No. 807) which is inherently short-
limited period to perform specific activities or
lived, temporary and transient; on the other hand,
services with a definite expected output: i.e.
retirement presupposes employment for a long
membership in Task Force, Part-Time,
period. The most that a non-career personnel can
Consultant/Employees.
expect upon the expiration of his employment is
b) Uniformed personnel of the Armed Forces of financial assistance. Petitioner is not even
the Philippines including those of the Philippine qualified to retire under the GSIS law.
Constabulary and Integrated National Police (PC-
3. Assuming arguendo that petitioner's
INP).
appointment is permanent, security of tenure is
c) Appointive officials and employees who retire available only for the term of office (i.e., duration
or elect to be separated from the service for of project).
optional retirement with gratuity under R.A. No.
4. The objective of Republic Act No. 6683 is not
1616, 4968 or with pension under R.A. No. 186, as
really to grant separation or retirement benefits
amended by R.A. No. 6680 or P.D. No. 1146, an
but reorganization 5 to streamline government
amended, or vice- versa.
functions. The application of the law must be
d) Officials and employees who retired voluntarily made consistent with the purpose for which it was
prior to the enactment of this law and have enacted. Thus, as the expressed purpose of the
received the corresponding benefits of that law is to reorganize the government, it will not
retirement/separation. have any application to special projects such as
e) Officials and employees with pending cases the WMECP which exists only for a short and
punishable by mandatory separation from the definite period. This being the nature of special
service under existing civil service laws, rules and projects, there is no necessity for offering its
regulations; provided that if such officials and personnel early retirement benefits just to induce
employees apply in writing within the prescriptive voluntary separation as a step to reorganization.
period for the availment of the benefits herein In fact, there is even no need of reorganizing the
authorized, shall be allowed only if acquitted or WMECP considering its short and limited life-span.
6
cleared of all charges and their application
accepted and approved by the head of office 5. The law applies only to employees of the
concerned." national government, government-owned or
Based on the above exclusions, herein petitioner controlled corporations with original charters and
does not belong to any one of them. Ms. Chua is a local government units.
full time employee of NIA entitled to all the Due to the impossibility of reconciling the
regular benefits provided for by the Civil Service conflicting interpretations of the parties, the Court
Commission. She held a permanent status as is called upon to define the different classes of
Personnel Assistant A, a position which belongs to employees in the public sector (i.e. government
the Administrative Service. . . . If casuals and civil servants).
emergency employees were given the benefit of
Who are regular employees? The Labor Code in
R.A. 6683 with more reason that this petitioner
Art. 280 (P.D. No. 492, as amended) deems an
who was holding a permanent status as Personnel
employment regular where the employee has
Assistant A and has rendered almost 15 years of
been engaged to perform activities which are
faithful, continuous service in the government
usually necessary or desirable in the usual
should be similarly rewarded by the beneficient
business or trade of the employer. No equivalent
(sic) purpose of the law. 4
definition can be found in P.D.No. 807
The NIA and the Civil Service Commission (promulgated on 6 October 1975, which
reiterate in their comment petitioner's exclusion superseded the Civil Service Act of 1965 — R.A.
from the benefits of Republic Act No. 6683, No. 2260) or in the Administrative Code of 1987
because: (Executive Order No. 292 promulgated on 25 July
1. Petitioner's employment is co-terminous with 1987). The Early Retirement Law itself (Rep. Act
the project per appointment papers kept by the No. 6683) merely includes such class of
Administrative Service in the head office of NIA employees (regular employees) in its coverage,
(the service record was issued by the Watershed unmindful that no such specie is employed in the
Management and Erosion Control Project public sector.
(WMECP), Pantabangan, Nueva Ecija). The project, The appointment status of government
funded by the World Bank, was completed as of employees in the career service is classified as
31 December 1988, after which petitioner's follows:
position became functus officio.
1. permanent — one issued to a person who has a particular project for which purpose
met the requirements of the position to which employment was made.
appointment is made, in accordance with the Included in the non-career service are:
provisions of the Civil Service Act and the Rules
and Standards promulgated in pursuance thereof; 1. elective officials and their personal or
7 confidential staff;
2. temporary — In the absence of appropriate 2. secretaries and other officials of Cabinet rank
eligibles and it becomes necessary in the public who hold their positions at the pleasure of the
interest to fill a vacancy, a temporary President and their personal confidential staff(s);
appointment should be issued to a person who 3. Chairman and Members of Commissions and
meets all the requirements for the position to boards with fixed terms of office and their
which he is being appointed except the personal or confidential staff;
appropriate civil service eligibility: Provided, That
such temporary appointment shall not exceed 4. contractual personnel or those whose
twelve months, but the appointee may be employment in the government is in accordance
replaced sooner if a qualified civil service eligible with a special contract to undertake a specific
becomes available. 8 work or job requiring special or technical skills not
available in the employing agency, to be
The Administrative Code of 1987 characterizes accomplished within a specific period, which in no
the Career Service as: case shall exceed one year and performs or
(1) Open Career positions for appointment to accomplishes the specific work or job, under his
which prior qualification in an appropriate own responsibility with a minimum of direction
examination is required; and supervision from the hiring agency.
(2) Closed Career positions which are scientific, or 5. emergency and seasonal personnel. 10

highly technical in nature; these include the There is another type of non-career employee:
faculty and academic staff of state colleges and
universities, and scientific and technical positions Casual — where and when employment is not
in scientific or research institutions which shall permanent but occasional, unpredictable,
establish and maintain their own merit systems; sporadic and brief in nature (Caro v. Rilloroza, 102
Phil. 70; Manuel v. P.P. Gocheco Lumber Co., 96
(3) Positions in the Career Executive Service; Phil. 945)
namely, Undersecretary, Assistant Secretary,
Bureau Director, Assistant Bureau Director, Consider petitioner's record of service:
Regional Director, Assistant Regional Director, Service with the government commenced on 2
Chief of Department Service and other officers of December 1974 designated as a laborer holding
equivalent rank as may be identified by the emergency status with the NIA — Upper
Career Executive Service Board, all of whom are Pampanga River Project, R & R Division. 11 From
appointed by the President. 24 March 1975 to 31 August 1975, she was a
(4) Career officers, other than those in the Career research aide with temporary status on the same
Executive Service, who are appointed by the project. On 1 September 1975 to 31 December
President, such as the Foreign Service Officers in 1976, she was with the NIA-FES III; R & R Division,
the Department of Foreign Affairs; then on 1 January 1977 to 31 May 1980, she was
with NIA — UPR IIS (Upper Pampanga River
(5) Commission officers and enlisted men of the Integrated Irrigation Systems) DRD. On 1 June
Armed Forces which shall maintain a separate 1980, she went to NIA — W.M.E.C.P. (Watershed
merit system; Management & Erosion Control Project) retaining
(6) Personnel of government-owned or controlled the status of temporary employee. While with this
corporations, whether performing governmental project, her designation was changed to
or proprietary functions, who do not fall under the personnel assistant on 5 November 1981; starting
non-career service; and 9 July 1982, the status became permanent until
the completion of the project on 31 December
(7) Permanent laborers, whether skilled, semi- 1988. The appointment paper 12 attached to the
skilled, or unskilled. 9 OSG's comment lists her status as co-terminus
The Non-Career Service, on the other hand, is with the Project.
characterized by: The employment status of personnel hired under
. . . (1) entrance on bases other than those of the foreign — assisted projects is considered co-
usual tests of merit and fitness utilized for the terminous, that is, they are considered employees
career service; and (2) tenure which is limited to a for the duration of the project or until the
period specified by law, or which is coterminous completion or cessation of said project (CSC
with that of the appointing authority or subject to Memorandum Circular No. 39, S. 1990, 27 June
his pleasure, or which is limited to the duration of 1990).
Republic Act No. 6683 seeks to cover and benefits The foregoing status (co-terminous) may be
regular, temporary, casual and emergency further classified into the following:
employees who have rendered at least a total of a) co-terminous with the project — When the
two (2) consecutive years government service. appointment is co-existent with the duration of a
Resolution No. 87-104 of the CSC, 21 April 1987, particular project for which purpose employment
provides: was made or subject to the availability of funds
for the same;
WHEREAS, pursuant to Executive Order No. 966
dated June 22, 1984, the Civil Service Commission b) co-terminous with the appointing authority —
is charged with the function of determining when appointment is co-existent with the tenure
creditable services for retiring officers and of the appointing authority.
employees of the national government; c) co-terminous with the incumbent — when
WHEREAS, Section 4 (b) of the same Executive appointment is co-existent with the appointee, in
Order No. 966 provides that all previous services that after the resignation, separation or
by an officer/employee pursuant to a duly termination of the services of the incumbent the
approved appointment to a position in the Civil position shall be deemed automatically abolished;
Service are considered creditable services, while and
Section 6 (a) thereof states that services rendered d) co-terminous with a specific period, e.g. "co-
on contractual, emergency or casual status are terminous for a period of 3 years" — the
non-creditable services; appointment is for a specific period and upon
WHEREAS, there is a need to clarify the aforesaid expiration thereof, the position is deemed
provisions inasmuch as some contractual, abolished.
emergency or casual employment are covered by It is stressed, however, that in the last two
contracts or appointments duly approved by the classifications (c) and (d), what is termed co-
Commission. terminous is the position, and not the appointee-
NOW, therefore, the Commission resolved that employee. Further, in (c) the security of tenure of
services rendered on contractual, emergency or the appointee is guaranteed during his
casual status, irrespective of the mode or manner incumbency; in (d) the security of tenure is
of payment therefor shall be considered as limited to a specific period.
creditable for retirement purposes subject to the A co-terminous employee is a non-career civil
following conditions: (emphasis provided) servant, like casual and emergency employees.
1. These services are supported by approved We see no solid reason why the latter are
appointments, official records and/or other extended benefits under the Early Retirement Law
competent evidence. Parties/agencies concerned but the former are not. It will be noted that Rep.
shall submit the necessary proof of said services; Act No. 6683 expressly extends its benefits for
early retirement to regular, temporary, casual and
2. Said services are on full time basis and
emergency employees. But specifically excluded
rendered prior to June 22, 1984, the effectivity
from the benefits are uniformed personnel of the
date of Executive Order No. 966; and
AFP including those of the PC-INP. It can be
3. The services for the three (3) years period prior argued that, expressio unius est exclusio alterius.
to retirement are continuous and fulfill the service The legislature would not have made a specific
requirement for retirement. enumeration in a statute had not the intention
What substantial differences exist, if any, been to restrict its meaning and confine its terms
between casual, emergency, seasonal, project, and benefits to those expressly mentioned 14 or
co-terminous or contractual personnel? All are casus omissus pro omisso habendus est — A
tenurial employees with no fixed term, non- person, object or thing omitted from an
career, and temporary. The 12 May 1989 CSC enumeration must be held to have been omitted
letter of denial 13 characterized herein petitioner's intentionally. 15 Yet adherence to these legal
employment as co-terminous with the NIA project maxims can result in incongruities and in a
which in turn was contractual in nature. The OSG violation of the equal protection clause of the
says petitioner's status is co-terminous with the Constitution.
Project. CSC Memorandum Circular No. 11, series The case of Fegurin, et al. v. NLRC, et al., 16
of 1991 (5 April 1991) characterizes the status of comes to mind where, workers belonging to a
a co-terminous employee — work pool, hired and re-hired continuously from
(3) Co-terminous status shall be issued to a one project to another were considered non-
person whose entrance in the service is project-regular and permanent employees.
characterized by confidentiality by the appointing Petitioner Lydia Chua was hired and re-hired in
authority or that which is subject to his pleasure four (4) successive projects during a span of
or co-existent with his tenure. fifteen (15) years. Although no proof of the
existence of a work pool can be assumed, her renewable for two (2) or three (3) years, 19
he
service record cannot be disregarded. explained:
Art. III, Sec. 1 of the 1987 Constitution This Bill covers only those who would like to go on
guarantees: "No person shall be deprived of life, early retirement and voluntary separation. It is
liberty, or property without due process of law, irrespective of the actual status or nature of the
nor shall any person be denied the equal appointment one received, but if he opts to retire
protection of the laws." under this, then he is covered.
. . . In Felwa vs. Salas, L-26511, Oct. 29, 1966, We It will be noted that, presently Pending in
ruled that the equal protection clause applies only Congress, is House Bill No. 33399 (a proposal to
to persons or things identically situated and does extend the scope of the Early Retirement Law). Its
not bar a reasonable classification of the subject wording supports the submission that Rep. Act
of legislation, and a classification is reasonable No. 6683 indeed overlooked a qualified group of
where (1) it is based on substantial distinctions civil servants. Sec. 3 of said House bill, on
which make real differences; (2) these are coverage of early retirement, would provide:
germane to the purpose of the law; (3) the Sec. 3. Coverage. — It will cover all employees of
classification applies not only to present the national government, including government-
conditions but also to future conditions which are owned or controlled corporations, as well as the
substantially identical to those of the present; (4) personnel of all local government units. The
the classification applies only to those who belong benefits authorized under this Act shall apply to
to the same class. 17 all regular, temporary, casual, emergency and
Applying the criteria set forth above, the Early contractual employees, regardless of age, who
Retirement Law would violate the equal protection have rendered at least a total of two (2)
clause were we to sustain respondents' consecutive years government service as of the
submission that the benefits of said law are to be date of separation. The term "contractual
denied a class of government employees who are employees" as used in this Act does not include
similarly situated as those covered by said law. experts and consultants hired by agencies for a
The maxim of Expressio unius est exclusio limited period to perform specific activities or
alterius should not be the applicable maxim in this services with definite expected output.
case but the doctrine of necessary implication Uniformed personnel of the Armed Forces of the
which holds that: Philippines, including those of the PC-INP are
No statute can be enacted that can provide all the excluded from the coverage of this Act. (emphasis
details involved in its application. There is always supplied)
an omission that may not meet a particular The objective of the Early Retirement or Voluntary
situation. What is thought, at the time of Separation Law is to trim the bureaucracy, hence,
enactment, to be an all-embracing legislation may vacated positions are deemed abolished upon
be inadequate to provide for the unfolding events early/voluntary retirement of their occupants. Will
of the future. So-called gaps in the law develop as the inclusion of co-terminous personnel (like the
the law is enforced. One of the rules of statutory petitioner) defeat such objective? In their case,
construction used to fill in the gap is the doctrine upon termination of the project and separation of
of necessary implication. The doctrine states that the project personnel from the service, the term
what is implied in a statute is as much a part of employment is considered expired, the office
thereof as that which is expressed. Every statute functus officio. Casual, temporary and contractual
is understood, by implication, to contain all such personnel serve for shorter periods, and yet, they
provisions as may be necessary to effectuate its only have to establish two (2) years of continuous
object and purpose, or to make effective rights, service to qualify. This, incidentally, negates the
powers, privileges or jurisdiction which it grants, OSG's argument that co-terminous or project
including all such collateral and subsidiary employment is inherently short-lived, temporary
consequences as may be fairly and logically and transient, whereas, retirement presupposes
inferred from its terms. Ex necessitate legis. And employment for a long period. Here, violation of
every statutory grant of power, right or privilege the equal protection clause of the Constitution
is deemed to include all incidental power, right or becomes glaring because casuals are not even in
privilege. This is so because the greater includes the plantilla, and yet, they are entitled to the
the lesser, expressed in the Maxim, in eo plus sit, benefits of early retirement. How can the
simper inest et minus. 18 objective of the Early Retirement Law of trimming
During the sponsorship speech of Congressman the bureaucracy be achieved by granting early
Dragon (re: Early Retirement Law), in response to retirement benefits to a group of employees
Congressman Dimaporo's interpellation on (casual) without plantilla positions? There would,
coverage of state university employees who are in such a case, be no abolition of permanent
extended appointments for one (1) year, positions or streamlining of functions; it would
merely be a removal of excess personnel; but the
positions remain, and future appointments can be
made thereto.
Co-terminous or project personnel, on the other Separate Opinions
hand, who have rendered years of continuous
service should be included in the coverage of the
Early Retirement Law, as long as they file their GUTIERREZ, JR., J., concurring:
application prior to the expiration of their term,
and as long as they comply with CSC regulations I concur but only insofar as our rulings are applied
promulgated for such purpose. In this connection, to RA 6683 applicants.
Memorandum Circular No. 14, Series of 1990 (5
March 1990) implementing Rep. Act No. 6850, 20
Separate Opinions
requires, as a condition to qualify for the grant of
eligibility, an aggregate or total of seven (7) years GUTIERREZ, JR., J., concurring:
of government service which need not be I concur but only insofar as our rulings are applied
continuous, in the career or non-career service,
to RA 6683 applicants.
whether appointive, elective, casual, emergency,
seasonal, contractual or co-terminous including Footnotes
military and police service, as evaluated and 1 Letter of Commissioner Samilo Borlongay, 17
confirmed by the Civil Service Commission. 21 A March 1989.
similar regulation should be promulgated for the
inclusion in Rep. Act No. 6683 of co-terminous 2 Annex "E", Rollo, P. 11
personnel who survive the test of time. This would 3 Annex "F", Rollo, p. 14.
be in keeping with the coverage of "all social
legislations enacted to promote the physical and 4 Rollo, p. 24-25.
mental well-being of public servants" 22 After all, 5 AN ACT PROVIDING BENEFITS FOR EARLY,
co-terminous personnel, are also obligated to the RETIREMENT AND VOLUNTARY SEPARATION FROM
government for GSIS contributions, medicare and THE GOVERNMENT SERVICE, AS WELL AS
income tax payments, with the general INVOLUNTARY SEPARATION OF CIVIL SERVICE
disadvantage of transience. OFFICERS AND EMPLOYEES PURSUANT TO
In fine, the Court believes, and so holds, that the VARIOUS EXECUTIVE ORDERS AUTHORIZING
denial by the respondents NIA and CSC of GOVERNMENT REORGANIZATION AFTER THE
petitioner's application for early retirement RATIFICATION OF THE 1987 CONSTITUTION
benefits under Rep. Act No. 6683 is unreasonable, APPROPRIATING FUNDS THEREFOR, AND FOR
unjustified, and oppressive, as petitioner had filed OTHER PURPOSES.
an application for voluntary retirement within a 6 See Joint DBM-CSC Circular Letter No. 88-1, 12
reasonable period and she is entitled to the December 1988, Rollo, 61.
benefits of said law. While the application was
7 Sec. 25, a and b, P.D. No. 807; see also CSC
filed after expiration of her term, we can give
Memorandum Circular No. 11, S. of 1991, 5 April
allowance for the fact that she originally filed the
1991.
application on her own without the assistance of
counsel. In the interest of substantial justice, her 8 Ibid., also Perez v. City of San Carlos, G.R. No. L-
application must be granted; after all she served 48196-R, 11 July 1978; Ata v. Namocatcat, G.R.
the government not only for two (2) years — the No. L-35703, 30 October 1972, 47 SCRA 320.
minimum requirement under the law but for 9 Executive Order No. 292, Section 7, 83 O.G. No.
almost fifteen (15) years in four (4) successive 39, 75 (September 1987)
governmental projects.
10 Ibid, Section 9, p. 77.
WHEREFORE, the petition is GRANTED.
11 Per Service Record, Rollo, p. 7.
Let this case be remanded to the CSC-NIA for a
favorable disposition of petitioner's application for 12 Rollo, p. 70.
early retirement benefits under Rep. Act No. 13 Page 3, this decision.
6683, in accordance with the pronouncements in
this decision. 14 See Agpalo, Ruben. Statutory Construction,
1986 ed. p. 161.
SO ORDERED.
15 People v. Manantan, 115 Phil. 664.
Narvasa, C.J., Melencio-Herrera, Cruz, Paras,
Feliciano, Bidin, Griño-Aquino, Medialdea, 16 G.R. No. 54083, 28 February 1983, 120 SCRA
Regalado, Davide, Jr., Romero and Nocon, JJ., 910.
concur. 17 Ormoc Sugar Co. v. Treasurer of Ormoc City, L-
23794, 17 February 1968.
18 Statutory Construction by Ruben E. Agpalo, rank of CESO III. On November 5, 1997, she was
1986 ed., p. 118-119 citing In re Dick, 38 Phil. 41 designated by the Secretary of Justice as Acting
(1918); City of Manila v. Gomez, G.R. No. L-37251, Chief Public Attorney. On February 5, 1998, her
August 31, 1981, 107 SCRA 98; Escribano v. Ovila, appointment was confirmed by President Ramos
G.R. No. L-30375, September 12, 1978, 85 SCRA so that, on February 20, 1998, she took her oath
245 (1978), also Go Chico v. Martinez, 45 Phil. and assumed office.
256 (1923); Gatchalian v. COMELEC, G.R. No. L- On July 1, 1998, petitioner Carina J. Demaisip was
32560, October 22, 1970, 35 SCRA 435 (1970); appointed “chief public defender” by President
People v. Uy Jui Pio, 102 Phil. 679 (1957) and Joseph Estrada. Apparently because the position
People v. Aquino, 83 Phil. 614 (1949). was held by respondent, another appointment
19 Deliberations House Bill No. 4942 — 8 March paper was issued by the President on July 6, 1998
1988, 6:30. p.m. designating petitioner Demaisip as “chief public
defender (formerly chief public attorney), PUBLIC
20 An Act to Grant Civil Service Eligibility Under
DEFENDER'S OFFICE, DEPARTMENT OF JUSTICE
Certain Conditions to Government Employees
vice ATTY. JOSEFINA G. BACAL, effective July 1,
Under Provisional or Temporary Status Who have
1998.” On the other hand, respondent was
rendered a Total of Seven (7) Years of Efficient
appointed “Regional Director, Public Defender’s
Service and for other Purposes.
Office” by the President.
21 Rule 1, Sec. 2(c) as amended by Memorandum
On July 7, 1998, petitioner Demaisip took her oath
Circular No. 25, series of 1990, 21 May 1990.
of office. President Estrada then issued a
22 See Joint CSC-DBM Circular No. 1, series of memorandum, dated July 10, 1998, to the
1991, 27 June 1991. personnel of the “Public Defender’s Office”
EN BANC announcing the appointment of petitioner
Demaisip as “CHIEF PUBLIC DEFENDER.”
[G.R. No. 139382. December 6, 2000] Petitioner Secretary of Justice was notified of the
THE SECRETARY OF JUSTICE SERAFIN R. CUEVAS, appointments of petitioner Demaisip and
EXECUTIVE SECRETARY RONALDO B. ZAMORA, respondent Bacal on July 15, 1998.
and ATTY. CARINA J. DEMAISIP, petitioners, vs. On July 17, 1998, respondent filed a petition for
ATTY. JOSEFINA G. BACAL, respondent. quo warranto questioning her replacement as
DECISION Chief Public Attorney. The petition, which was
filed directly with this Court, was dismissed
MENDOZA, J.: without prejudice to its refiling in the Court of
This case involves the appointment and transfer Appeals. Accordingly, respondent brought her
of career executive service officers (CESOs). case in the Court of Appeals which, on March 25,
More specifically, it concerns the “appointment” 1999, ruled in her favor, finding her to be lawfully
of respondent Josefina G. Bacal, who holds the entitled to the Office of Chief Public Attorney.
rank of CESO III, to the position of Chief Public Petitioners seek the reversal of the decision of the
Attorney in the Public Attorney’s Office, which has Court of Appeals on the following grounds ¾
a CES Rank Level I, and her subsequent transfer,
made without her consent, to the Office of the I. THE COURT OF APPEALS ERRED IN RULING
Regional Director of the PAO. THAT RESPONDENT JOSEFINA G. BACAL, A
CAREER EXECUTIVE SERVICE OFFICER, HAS A
In its decision rendered on March 25, 1999, the VALID AND VESTED RIGHT TO THE POSITION OF
Court of Appeals declared respondent Josefina G. CHIEF PUBLIC ATTORNEY AND, AS SUCH, CANNOT
Bacal entitled to the position of Chief Public BE REASSIGNED OR TRANSFERRED TO THE
Attorney in the Public Attorney’s Office. POSITION OF REGIONAL DIRECTOR, PUBLIC
Petitioners moved for a reconsideration, but their ATTORNEY’S OFFICE, DEPARTMENT OF JUSTICE.
motion was denied by the appeals court in its
resolution dated July 22, 1999. Hence this II. THE COURT OF APPEALS ERRED IN RULING
petition for review on certiorari. Petitioners THAT RESPONDENT BACAL, WHO HOLDS A CES
contend that the transfer of respondent to the RANK LEVEL III, WAS REASSIGNED OR
Office of the Regional Director of the PAO is TRANSFERRED TO A POSITION WHICH DOES NOT
appropriate considering her rank as CESO III. CORRESPOND TO HER PRESENT RANK LEVEL
INASMUCH AS THE POSITION OF BUREAU
The background of this case is as follows: REGIONAL DIRECTOR CARRIES A CES RANK LEVEL
Respondent Josefina G. Bacal passed the Career V ONLY. CONTRARY TO THE CONCLUSIONS OF
Executive Service Examinations in 1989. On July THE COURT OF APPEALS, SAID POSITION OF
28, 1994, she was conferred CES eligibility and REGIONAL DIRECTOR, PUBLIC ATTORNEY’S
appointed Regional Director of the Public OFFICE, THE POSITION TO WHICH RESPONDENT
Attorney’s Office. On January 5, 1995, she was BACAL WAS REASSIGNED OR TRANSFERRED,
appointed by then President Fidel V. Ramos to the CARRIES A CES RANK LEVEL III WHICH
CORRESPONDS TO HER CES RANK III LEVEL. AS security of tenure since on the basis of the
AN OFFICER WITH A RANK III LEVEL, RESPONDENT appointment, she was appointed, not merely
BACAL IS NOT THEREFORE ELIGIBLE FOR THE assigned, to a particular station. Her involuntary
POSITION OF CHIEF PUBLIC ATTORNEY WHICH transfer, through appointment, to that of a mere
CARRIES A CES RANK LEVEL I. Regional Director, did not either conform to the
rules on the constitutional protection of security
III. UPON HER REASSIGNMENT OR TRANSFER TO
of tenure. Above all, her supposed appointment
THE POSITION OF REGIONAL DIRECTOR,
as a Regional Director is not only temporary but is
RESPONDENT BACAL DID NOT LOSE HER CES
on the other hand permanent wherein she lost her
RANK III AND HER RIGHT TO RECEIVE THE SALARY
position as Chief Public Attorney, or her
CORRES-PONDING TO HER PRESENT RANK.
connection with the previous position being
IV. RESPONDENT BACAL FAILED TO SHOW THAT severed.
SHE HAS A CLEAR RIGHT TO THE POSITION OF
. . . .
CHIEF PUBLIC ATTORNEY.
In the case of the petitioner, there is certainly a
V. RESPONDENT BACAL FAILED TO FULLY
diminution in duties and responsibilities when she
EXHAUST THE ADMINISTRATIVE REMEDIES
was downgraded through the July 6, 1998
AVAILABLE TO HER BEFORE FILING THE PETITION
appointment, involuntarily made, from that of
FOR QUO WARRANTO WITH THE COURT OF
Chief Public Attorney to a mere Regional Director.
APPEALS.
To repeat, the rank equivalent to a Bureau
I. Exhaustion of Administrative Remedies
Director is Rank III while that of a mere Bureau
We first consider petitioners’ contention that Regional Director is Rank V. Diminution in duties
respondent’s quo warranto suit should have been and responsibilities, certainly becomes apparent
dismissed for failure of respondent to exhaust and then in the matter of salary, the basic salary
administrative remedies by appealing to the of a Chief Public Attorney together with all the
Office of the President. perks, would amount to P575,199.00. In the case
of a Regional Director, his basic salary together
The contention has no merit. If, as has been held, with all the perks, would only amount to
no appeal need be taken to the Office of the P341,479.96. Admittedly, when a CESO is
President from the decision of a department head assigned or made to occupy a position with a
because the latter is in theory the alter ego of the lower salary grade, he shall supposedly continue
former, there is greater reason for not requiring to be paid his salary that attaches to his CES
prior resort to the Office of the President in this rank. It cannot, on the other hand, be denied that
case since the administrative decision sought to the moment a non-CESO is appointed to a CES
be reviewed is that of the President himself. position, he shall receive, at the same time, the
Indeed, we have granted review in other cases salary of his CES position. There is merit in the
involving the removal of the Administrator of the petitioner’s argument that allowing the Regional
Philippine Overseas Employment Administration Director to receive continuously the salary rate of
and the Executive Director of the Land Chief Public Attorney in effect would amount to an
Transportation Office without requiring the illegal consequence since the disbursement of
petitioners to exhaust administrative remedies public funds, as budgeted, provides funding for
considering that the administrative actions in only one Chief Public Attorney. The dilemma
question were those of the President. arises when both the petitioner and respondent
In any event, the doctrine of exhaustion of Demaisip would be claiming the salary of a Chief
administrative remedies does not apply when the Public Attorney. There is no pretension either in
question raised is purely legal. In this case, the the Brief of the public respondents that there has
question is whether respondent’s transfer to the been a supplemental budget for the petitioner,
position of Regional Director of the Public now downgraded to a mere Regional Director, to
Attorney’s Office, which was made without her be receiving continuously the salary scale of a
consent, amounts to a removal without cause. Chief Public Attorney.
This brings us to the main issue in this appeal. . . . .
II. Merits of the Case
Changing a CESO, Rank III, with a non-CESO
In holding that respondent’s transfer amounted to eligible nor a CESO defies the recruitment,
a removal without cause, the Court of Appeals selection and appointment process of the Career
said: Executive Service. As a matter of fact, as a rule
(1997 Revised Edition, Handbook, Career
. . . Her appointment as Regional Director was in Executive Service), the appointment to most
effect a removal in the guise of transfer, to positions in the CES is supposed to be made by
repeat, without her consent. Having been validly the President only from the list of CES eligibles,
appointed Chief Public Defender by the President but recommended by the CES Board. Admittedly,
on February 8, 1998, would naturally entitle her to an incumbent of a CES position may qualify for
appointment to a CES rank, only upon the it merely in an acting capacity in the absence of
confirming of a CES Eligibility and compliance with appropriate eligibles. The appointment extended
the other requirements being prescribed by the to him cannot be regarded as permanent even if it
Board (Ibid. p. 5). Precisely, the CES was created may be so designated. . . .
pursuant to PD No. 1 (adopting the Integrated It is contended, however, that respondent is
Reorganizational Plan, dated September 24, qualified for the position of Chief Public Attorney
1972), if only to form a continuing pool of well- because this position has a CES Rank Level III,
selected and development-oriented career while that of Regional Director, Public Attorney’s
administrators who shall provide competent and Office, has a CES Rank Level V. This is not so.
faithful service (Ibid. p. 2). We cannot see this The position of Chief Public Attorney has a CES
from that of the petitioner then being replaced by Rank Level I and a Salary Grade 30, while that of
a non-CESO. Regional Director of the PAO has a CES Rank
The appealed decision will not bear analysis. Level III and a Salary Grade 28. This is shown by
the following:
First. What should be emphasized in this case is
that respondent Josefina G. Bacal is a CESO III and 1. Certification, dated April 6, 1999,
that the position of Regional Director of the PAO, issued by the Secretary of the Department of
to which she was transferred, corresponds to her Budget and Management (DBM), which states that
CES Rank Level III and Salary Grade 28. This was “the position of the head of Public Attorney’s
her position before her “appointment” on Office (PAO) is classified as Chief Public Attorney
February 5, 1998 to the position of Chief Public at Salary Grade 30” (Annex A of Annex M,
Attorney of the PAO, which requires a CES Rank Petition).
Level I for appointment thereto. Respondent 2. Certification, dated April 15, 1999, issued by
Bacal therefore has no ground to complain. She Elmor D. Juridico, then Executive Director of the
may have been considered for promotion to Rank CES Board, which states that “the Rank
I to make her appointment as Chief Public equivalent to the position of Chief Public Attorney
Attorney permanent. The fact, however, is that and Regional Public Attorney are CESO Rank I and
this did not materialize as petitioner Carina J. CESO Rank III respectively” (Annex B of Annex M,
Demaisip was appointed in her place. If Petition); and
respondent was paid a salary equivalent to Salary
Grade 30 while she was holding that office, it was 3. Certification, dated July 8, 1998, previously
only because, under the law, if a CESO is assigned issued to respondent Bacal by then Executive
to a position with a higher salary grade than that Director Juridico of the CES Board, stating that the
corresponding to his/her rank, he/she will be position of Chief Public Attorney has a CES rank
allowed the salary of the CES position. equivalent of Rank I. (vide Annex C of Annex M,
Petition). The certification reads:
As respondent does not have the rank appropriate
for the position of Chief Public Attorney, her This is to certify that Atty. JOSEFINA G. BACAL,
appointment to that position cannot be Chief Public Attorney, Public Attorney’s Office was
considered permanent, and she can claim no conferred CES Eligibility on July 28, 1994 per
security of tenure in respect of that position. As Board Resolution No. 94-4620 and was appointed
held in Achacoso v. Macaraig: Career Executive Service Officer (CESO) Rank III
by then President Fidel V. Ramos on January 5,
It is settled that a permanent appointment can be 1995. She is yet to fulfill the requirements for an
issued only “to a person who meets all the adjustment of her CES rank (from CES Rank III to
requirements for the position to which he is being Rank I) to a level equivalent to her present
appointed, including the appropriate eligibility position.
prescribed.” Achacoso did not. At best, therefore,
his appointment could be regarded only as This certification is issued upon the request of
temporary. And being so, it could be withdrawn Atty. Bacal for whatever purpose it may serve
at will by the appointing authority and “at a best.
moment’s notice,” conformably to established Second. The Court of Appeals held that
jurisprudence. . . . respondent Bacal had acquired security of tenure
The mere fact that a position belongs to the as Chief Public Attorney by the mere fact of her
Career Service does not automatically confer appointment to that position. This is likewise the
security of tenure on its occupant even if he does point of the dissent of Justice Gonzaga-Reyes who
not possess the required qualifications. Such contends that a CES eligibility is all that a person
right will have to depend on the nature of his needs in order to acquire security of tenure in any
appointment, which in turn depends on his position embraced in the Career Executive
eligibility or lack of it. A person who does not service; that a CESO rank is only necessary to
have the requisite qualifications for the position differentiate a CESO’s general managerial
cannot be appointed to it in the first place or, only duties/responsibilities, personal qualifications, and
as an exception to the rule, may be appointed to demonstrated competence; and that no other CES
examination is required for appointment to a Upon conferment of a CES eligibility and
higher rank. compliance with the other requirements
prescribed by the Board, an incumbent of a CES
Appointments, assignments, reassignments, and
position may qualify for appointment to a CES
transfers in the Career Executive Service are
rank. Appointment to a CES rank is made by the
based on rank. On this point, the Integrated
President upon the recommendation of the
Reorganization Plan cannot be any clearer. It
Board. This process completes the official’s
provides:
membership in the CES and most importantly,
c. Appointment. Appointment to appropriate confers on him security of tenure in the CES.
classes in the Career Executive Service shall be
There are six (6) ranks in the CES ranking
made by the President from a list of career
structure. The highest rank is that of a Career
executive eligibles recommended by the Board.
Executive Service Officer I (CESO I), while the
Such appointments shall be made on the basis of
lowest is that of CESO VI.
rank; provided that appointments to the higher
ranks which qualify the incumbents to The appropriate CESO rank to which a CES eligible
assignments as undersecretary and heads of may be appointed depends on two major
bureaus and offices and equivalent positions shall qualification criteria, namely: (1) level of
be with the confirmation of the Commission on managerial responsibility; and, (2) performance.
Appointments. The President may, however, in Performance is determined by the official’s
exceptional cases, appoint any person who is not performance rating obtained in the annual
a Career Executive Service eligible; provided that CESPES. On the other hand, managerial
such appointee shall subsequently take the responsibility is based on the level of the general
required Career Executive Service examination duties and responsibilities which an eligible is
and that he shall not be promoted to a higher performing, as follows:
class until he qualifies in such examination.
Levels of Duties
At the initial implementation of this Plan, an and Rank
incumbent who holds a permanent appointment Equivalent
to a position embraced in the Career Executive Responsibilities
Service shall continue to hold his position, but
may not advance to a higher class of position in if level of managerial
the Career Executive Service unless or until he responsibilities I
qualifies for membership in the Career Executive are comparable to that of an Under-
Service. secretary
.... if comparable to that of an
Assistant II
e. Assignments, Reassignments and Transfers. Secretary
Depending upon their ranks, members of the if comparable to that of a Bureau
Service shall be assigned to occupy positions of III
Undersecretary, Assistant Secretary, Bureau Director or a Department Regional
Director, Assistant Bureau Director, Regional Director
Director, Assistant Regional Director, Chief of if comparable to that of an
Department Service and other officers of Assistant IV
equivalent rank as may be identified by the Board Bureau Director, Department
on the basis of the members’ functional expertise. Assistant Regional Director or
... Department Service Chief
The rules and regulations promulgated by the CES if comparable to that of a Bureau
Board to implement the Integrated Reorganization V
Plan are equally clear in providing that ¾ Regional Director
if comparable to that of a Bureau
Career Executive Service Eligibility
VI
Passing the CES examination entitles the Assistant Regional Director
examinee to a conferment of a CES eligibility and
As a general rule, a CES eligible will be
the inclusion of his name in the roster of CES
recommended for appointment to the rank
eligibles. Conferment of CES eligibility is done by
equivalent of the level of his managerial
the Board through a formal Board Resolution after
responsibility if his performance rating is
an evaluation of the examinee’s performance in
Satisfactory or higher. If the performance rating
the four stages of the CES eligibility examinations.
is Outstanding, he will be recommended one rank
.... higher than his level of managerial responsibility.
Appointment to CES Rank Security of tenure in the career executive service
is thus acquired with respect to rank and not to
position. The guarantee of security of tenure to higher levels. To fill this crucial gap, it is
members of the CES does not extend to the recommended that a Career Executive Service be
particular positions to which they may be established. This group of senior administrators
appointed ¾ a concept which is applicable only to shall be carefully selected on the basis of high
first and second-level employees in the civil qualifications and competence. Skilled in both
service ¾ but to the rank to which they are techniques and processes of management, these
appointed by the President. Accordingly, career executives will act as catalysts for
respondent did not acquire security of tenure by administrative efficiency and as agents of
the mere fact that she was appointed to the administrative innovation.
higher position of Chief Public Attorney since she The status and salary of the career executives will
was not subsequently appointed to the rank of be based on their rank, and not on the job that
CESO I based on her performance in that position they occupy at any given time . . . . In this sense,
as required by the rules of the CES Board. the rank status of the Career Executive Service is
Indeed, to contend, as does the dissent of Justice similar to that of the commissioned officers in the
Gonzaga-Reyes, that a CES eligibility was all that Armed Forces or members of the Foreign Service.
was required to make her appointment to the Unlike these latter organizations, however,
position of Chief Public Attorney permanent would entrance to the Career Executive Service will not
give rise to an anomalous situation. Following be generally at an early age in a relatively junior
such theory, even if respondent is not appointed level but at a senior management level.
CESO I because her performance as Chief Public . . . .
Attorney does not warrant her appointment to
such higher rank, she cannot be transferred to The rank classification in the Service will allow for
any other office to which her rank (CESO III) mobility or flexibility of assignments such that the
qualifies her. This theory of the dissent, i.e., that government could utilize the services or special
a CES eligibility gives the appointee security of talents of these career executives wherever they
tenure - not the ruling in this case that it is are most needed or will likely create the greatest
appointment to the appropriate rank that confers impact. This feature is especially relevant in a
security of tenure - is what will undermine the developing country which cannot afford to have
Career Executive Service. its scarce executive manpower pegged to
particular positions.
Third. Within the Career Executive Service,
personnel can be shifted from one office or Mobility and flexibility in the assignment of
position to another without violation of their right personnel, the better to cope with the exigencies
to security of tenure because their status and of public service, is thus the distinguishing feature
salaries are based on their ranks and not on their of the Career Executive Service. To attain this
jobs. To understand this, it is necessary to objective, the Integrated Reorganization Plan
consider the reason for the creation of the Career provides:
Executive Service. e. Assignments, Reassignments and
R.A. No. 5435, as amended by R.A. Nos. 6076, Transferees. . . .
6172, and 6175, created a commission charged Any provision of law to the contrary
with the specific function of reorganizing the notwithstanding, members of the Career
government “to promote simplicity, economy, and Executive Service may be reassigned or
efficiency” in its operations. The result was the transferred from one position to another and from
preparation of the Integrated Reorganization Plan one department, bureau or office to another;
which was adopted and declared part of the law of provided that such reassignment or transfer is
the land by P.D. No. 1 on September 24, 1972. A made in the interest of public service and involves
major feature of the Integrated Reorganization no reduction in rank or salary; provided, further,
Plan was the creation of the Career Executive that no member shall be reassigned or transferred
Service whose justification was explained by the oftener than every two years; and provided,
Commission on Reorganization, thus: furthermore, that if the officer concerned believes
The present Civil Service system is not geared to that his reassignment or transfer is not justified,
meet the executive manpower needs of the he may appeal his case to the President.
government. The filling of higher administrative The implementing rules and regulations of the
positions is often based on considerations other CES Board provide:
than merit and demonstrated competence. The
area of promotion is currently confined to the Salary of Career Executive Service Officers. A
person or persons “next-in-rank” in the agency. CESO is compensated according to his CES rank
Moreover, personnel classification and and not on the basis of the CES position he
compensation are uniformly based on concepts occupies. However, if a CESO is assigned to a
and procedures which are suited to positions in CES position with a higher salary grade than that
the lower levels but not to managerial posts in the
of his CES rank, he is allowed to receive the salary may, in exceptional cases, appoint any person
of the CES position. who is not a Career Executive Service eligible;
provided that such appointee shall subsequently
Should he be assigned or made to occupy a CES
take the required Career Executive Service
position with a lower salary grade, he shall
examination and that he shall not be promoted to
continue to be paid the salary attached to his CES
a higher class until he qualified in such
rank.
examination.
Petitioners are, therefore, right in arguing that
For the same reason that the temporary
respondent, “as a CESO, can be reassigned from
appointment of respondent Josefina G. Bacal as
one CES position to another and from one
Chief Public Attorney is valid under this provision
department, bureau or office to another. Further,
of the law despite the fact that she does not hold
respondent, as a CESO, can even be assigned or
the rank of CESO I, so is the appointment to the
made to occupy a CES position with a lower salary
same position of petitioner Carina J. Demaisip.
grade. In the instant case, respondent, who holds
The question in this case is not the validity of the
a CES Rank III, was correctly and properly
appointment to such position but whether the
appointed by the appointing authority to the
appointee acquires security of tenure even if he
position of Regional Director, a position which has
does not possess the requisite rank. There is no
a corresponding CES Rank Level III.”
claim that petitioner Demaisip has a right to
Indeed, even in the other branches of the civil remain in the position of Chief Public Attorney
service, the rule is that, unless an employee is permanently.
appointed to a particular office or station, he can
On the other hand, as respondent herself does not
claim no security of tenure in respect of any
have the requisite qualification for the position of
office. This rule has been applied to such
Chief Public Attorney, she cannot raise the lack of
appointments as Director III or Director IV or
qualification of petitioner. As held in Carillo v.
Attorney IV or V in the Civil Service Commission
Court of Appeals, “in a quo warranto proceeding
since the appointments are not to specified
the person suing must show that he has a clear
offices but to particular ranks; Election Registrars;
right to the office allegedly held unlawfully by
Election Officers, also in the Commission on
another. Absent that right, the lack of
Elections; and Revenue District Officers in the
qualification or eligibility of the supposed usurper
Bureau of Internal Revenue. Reiterating the
is immaterial.” Indeed, this has been the
principle in Sta. Maria v. Lopez, this Court said:
“exacting rule” since it was first announced, 95
. . . [T]he rule that outlaws unconsented transfers years ago, in Acosta v. Flor. As at present
as anathema to security of tenure applies only to embodied in Rule 66, §5 of the Rules of Civil
an officer who is appointed - not merely assigned Procedure, the rule is that “a person claiming to
- to a particular station. Such a rule does not be entitled to a public office or position usurped or
proscribe a transfer carried out under a specific unlawfully held or exercised by another may bring
statute that empowers the head of an agency to an action therefor in his own name.”
periodically reassign the employees and officers
WHEREFORE, the decision of the Court of
in order to improve the service of the agency.
Appeals is REVERSED and the petition for quo
The use of approved techniques or methods in
warranto filed by respondent is DISMISSED.
personnel management to harness the abilities of
employees to promote optimum public service SO ORDERED.
cannot be objected to. . . . Davide, Jr., C.J., Bellosillo, Melo, Kapunan, Pardo,
For the foregoing reasons, we hold that Buena, Ynares-Santiago and De Leon, Jr., JJ.,
respondent’s appointment to the position of Chief concur.
Public Attorney was merely temporary and that, Puno J., see separate opinion.
consequently, her subsequent transfer to the
position of Regional Director of the same office, Vitug J., join Justice Puno in his separate opinion.
which corresponds to her CESO rank, cannot be Panganiban and Quisumbing, JJ., join the dissent
considered a demotion, much less a violation of of J. Reyes.
the security of tenure guarantee of the
Constitution. Gonzaga-Reyes J., see dissenting opinion.

Fourth. On the other hand, Justice Puno makes Per Justice Bernardo Ll. Salas and concurred in by
much of the fact that petitioner Carina J. Demaisip Justices Quirino D. Abad Santos, Jr. and Candido V.
is not a CES eligible. Suffice it to say the law Rivera.
allows in exceptional cases the appointment of It is unnecessary to determine whether the Public
non-CES eligibles provided that the appointees Attorney’s Office has been renamed “Public
subsequently pass the CES Examinations. Thus Defender’s Office” by reason of such appellation
Part III, Chap. I, Art. IV, par. 5(c) of the Integrated in R.A. No. 8194 (General Appropriations Act of
Reorganization Plan provides that the President 1996). It is sufficient to point out that petitioner
Secretary of Justice himself, in an opinion dated SECOND DIVISION
October 5, 1998, stated that “the correct and G.R. No. 141141 June 25, 2001
official name of [the] office and its senior officers
are still those stated in the Administrative Code of PHILIPPINE AMUSEMENT AND GAMING
1987,” because the General Appropriations Act CORPORATION (PAGCOR), petitioner,
cannot amend the Administrative Code. vs.
CARLOS P. RILLORAZA, respondent.
Petition, pp. 7-8; Rollo, pp. 15-16.
DE LEON, JR., J.:
E.g., Kilusang Bayan sa Paglilingkod ng mga
Magtitinda ng Bagong Pamilihang Bayan ng Before us is a petition for review on certiorari
Muntinglupa, Inc. v. Dominguez, 205 SCRA 92 praying for the reversal of the Decision dated
(1992). August 31, 19991 as well as the Resolution dated
November 29, 1999, rendered by the Court of
Achacoso v. Macaraig, 195 SCRA 235 (1991). Appeals in CA-G.R. SP No. 51803.
Pangilinan v. Maglaya, 225 SCRA 512 (1993). The facts are undisputed:
NDC v. Collector, 9 SCRA 429 (1963); Mangubat v. On November 5, 1997, administrative charges for
Osmeña, 105 Phil. 1308 (1959). dishonesty, grave misconduct, conduct prejudicial
CA Decision, pp. 14-16, 20-21; Rollo, pp. 53-55, to the best interest of the service, and loss of
59-60 (emphasis by the Court of Appeals). confidence, were brought against respondent
Carlos P. Rilloraza, a casino operations manager
195 SCRA 235, 239-240 (1991).
of petitioner PHILIPPINE AMUSEMENT AND
Memorandum for Petitioners, dated Sept. 18, GAMING CORPORATION (PAGCOR). Respondent
2000, pp. 9-10. allegedly committed the following acts:
Part. III, Chap. I, Art. IV, par. 5(c) (emphasis Summary description of charge(s):
added).
Failure to prevent an irregularity and violations of
CES Handbook, pp. 5-6 (emphasis added). casino and regulations committed by co-officers
An act authorizing the President of the Philippines during his shift on October 9, 1997.
with the help of a Commission on Reorganization, 1. During his shift of 6:00 a.m.–2:00 p.m. on
to reorganize the different executive October 9, 1997, four (4) personal checks with a
departments, bureaus, offices, agencies, and total value of Pesos: Five Million (P5,000,000)
instrumentalities of the government including were issued by a small-time financier/player and
banking or financial institutions and corporations were facilitated by a COM with the Treasury
owned or controlled by its subject to certain Division which enabled the small-time
conditions and limitations. financier/player to withdraw and receive said
Part. III, Chap. I, Art. IV, par. 5(e). amount. The facilitation of the checks was not
authorized by the Senior Branch Manager (SBM)
CES Handbook, p. 8. or the Branch Manager for Operations (BMO) and
Petition, pp. 11-12; Rollo, pp. 19-20. the COM who facilitated the checks was not on
duty then.
Fernandez v. Sto. Tomas, 242 SCRA 192 (1995).
2. He even facilitated one (1) of the personal
Ibañez v. Commission on Elections, 19 SCRA 1002 checks with a value of Pesos: Five Hundred
(1967). Thousand (P500,000.00).
De Guzman, Jr. v. Commission on Elections, G.R. 3. He failed to stop a top-ranking officer from
No. 129118, July 19, 2000. placing bets over and above the allowable limit of
244 SCRA 787 (1995). P5,000.00 per deal, he failed to stop the same
officer from playing in the big tables and lastly, he
31 SCRA 637, 653 (1970).
allowed the same officer to play beyond the
Carillo v. Court of Appeals, 77 SCRA 170 (1977). allowable time limit of 6:00 a.m.
Accord, Santiago v. Guingona, 298 SCRA 756
Respondent duly filed his answer during an
(1998).
investigation conducted by petitioner’s Corporate
Id. at 177. Accord, Santiago v. Guingona, 298 Investigation Unit. He narrated the events that
SCRA 756 (1998). transpired:
Garcia v. Perez, 99 SCRA 628, 634 (1980). "When I reported for my 6:00 a.m. to 2:00 p.m.
5 Phil. 18 (1905). shift, on October 9, that morning I saw BM
RICHARD SYHONGPAN beside TABLE #22 (BB)
Republic of the Philippines sitting at a coffee table inside Area 3. While inside
SUPREME COURT the Area 3, GAM RENE QUITO approached me with
Manila a check worth P500,000.00 requested by a
customer for endorsement to the Treasury. Since 3 checks, I have no knowledge about it since they,
I’ve been out of Manila branch for 2 years and I’ve BM SYHONGPAN and COM GONZALES, kept it a
just been recalled to this branch for only more secret from me. When GAM EUGENIO returned
than 3 weeks, I’m not quite familiar with the from the room of BM SYHONGPAN he handed me
systems and I don’t know this customer. I some cash, which according to him, was given by
immediately approached COM CARLOS BM SYHONGPAN as ‘BALATO’. I did not accept the
GONZALES, who at that time was still around, to money because at that moment I was so mad that
verify regarding the said check and his immediate they involved me beyond my innocence since I
reply was "IT’S OKAY AND GOOD AND IT WAS am new in the branch. I then instructed GAM
GUARANTEED BY BM SYHONGPAN’. In fact, I EUGENIO to return the money to BM SYHONGPAN.
reconfirmed it again with COM GONZALES since (sic)
he is more familiar with the systems and Finding Rilloraza’s explanation unsatisfactory, the
customers, he answered me the same. So I gave PAGCOR Board handed down a Resolution on
the approval to GAM QUITO for endorsement. December 2, 1997 dismissing respondent and
When I went in the office, I instructed OOS several others from PAGCOR, on the grounds of
GILBERT CABANA to beep SBM VIC ADVINCULA dishonesty, grave misconduct and/or conduct
and BMO DARIO CORDERO to call office "ASAP" prejudicial to the best interest of the service and
because I wanted to relay this matter to them and loss of confidence, effective December 5, 1997.
there were no reply from both of them. I The Board also denied respondent’s motion for
instructed OOS CABANA to send messages again reconsideration in a Resolution dated December
to SBM & BMO, but still I received no reply. It was
16, 1997.
until after noontime that BMO CORDERO returned
my call and I reported the incident to him. When I Respondent appealed to the Civil Service
was at home at around 3:30 p.m. SBM ADVINCULA Commission. On November 20, 1998, the
returned my call and I reported the incident. I also Commission issued Resolution No. 983033,2 the
relayed the incident to SBM REYES. dispositive portion of which provides, to wit:
While during my rounds, I went down to the New WHEREFORE, the appeal of Carlos P. Rilloraza is
VIP area and there I saw BM SYHONGPAN sitting hereby dismissed. However, the Commission finds
at TABLE #3(BB) and he was holding house cards appellant guilty only of Simple Neglect of Duty
at that time. I approached and stopped him but and metes out upon him the penalty of one month
he reacted that the bet was not his but to a and one day suspension. The assailed Resolution
CUSTOMER’S. I took his words because as a of PAGCOR Board of Directors is thus modified.
subordinate, I respected him as one of our The Commission denied petitioner’s motion for
superior who very well know all our company’s reconsideration in Resolution No. 990465 dated
policy esp. that an officer is not allowed to play at February 16, 1999.3
BIG table and are only allowed to bet with a
maximum of P5,000.00 only. So I believe it was On appeal, the Court of Appeals affirmed the
not his bet but the said customer. At that time resolution of the Commission.4 The appellate court
there was no way for me to stop the game ordered petitioner to reinstate private respondent
because I saw the said customer, named MS. with payment of full backwages plus all tips,
CORAZON CASTILLO, whom I don’t know her [sic] bonuses and other benefits accruing to his
since I was out of Manila Branch 2 years, and position and those received by other casino
whom BM SYHONGPAN was referring to as the operations managers for the period starting
player, has a lot of chips worth about P7 Million in January 5, 1998 until his actual reinstatement.
front of her and was betting P1.5M on the banker Petitioner filed a motion for reconsideration,5
side which was over the maximum table limit by which was denied by the appellate court in the
P500,000.00. I know we are allowed to authorize assailed resolution of November 29, 1999.6
approval by raising the betting limits as per Hence, the instant petition.
request of the playing customers.
PAGCOR avers that:
After the game, the chips were encashed and I
instructed GAM J. EUGENIO to accompany BM I
SYHONGPAN to his room because he was too THE COURT OF APPEALS GRAVELY ERRED WHEN
drunk. When I was doing my rounds again, that’s IT FAILED AND REFUSED TO CONSIDER THAT
how I found out from rumors within the gaming RESPONDENT WAS A CONFIDENTIAL APPOINTEE
areas that this MS. CASTILLO was used by BM OR EMPLOYEE WHOSE TERM HAD EXPIRED BY
SYHONGPAN and COM GONZALES to played [sic] REASON OF LOSS OF CONFIDENCE.
in behalf of them the whole time. And I also
II
learned that there were four checks endorsed
during my shift which I facilitated only one check THE COURT OF APPEALS GRAVELY ERRED WHEN
worth P500,000.00 after I verified and confirmed IT AFFIRMED THE CSC RESOLUTIONS MODIFYING
it with COM GONZALES. With regards to the other THE PENALTY METED OUT ON RESPONDENT FROM
DISMISSAL TO SUSPENSION, DESPITE THE been amended, modified or deemed repealed by
GRAVITY OR SERIOUSNESS OF THE OFFENSES the 1987 Constitution and Executive Order No.
COMMITTED BY THE LATTER ON ACCOUNT OF THE 292 (Administrative Code of 1987).
EXTRAORDINARY RESPONSIBILITIES AND DUTIES However, the same cannot be said with respect to
REPOSED IN THE RESPONDENT BY VIRTUE OF HIS the last portion of Section 16 which provides that
POSITION. "all employees of the casino and related services
The wellspring of stability in government service shall be classified as ‘confidential’ appointees."
is the constitutional guarantee of entrance While such executive declaration emanated
according to merit and fitness and security of merely from the provisions of Section 2, Rule XX
tenure, viz: of the Implementing Rules of the Civil Service Act
of 1959, the power to declare a position as policy-
xxx xxx xxx
determining, primarily confidential or highly
(2) Appointments in the civil service shall be technical as defined therein has subsequently
made only according to merit and fitness to be been codified and incorporated in Section 12(9),
determined, as far as practicable, and, except to Book V of Executive Order No. 292 or the
positions which are policy-determining, primarily Administrative Code of 1987. This later enactment
confidential, or highly technical, by competitive only serves to bolster the validity of the
examination. categorization made under Section 16 of
(3) No officer or employee of the civil service shall Presidential Decree No. 1869. Be that as it may,
be removed or suspended except for cause such classification is not absolute and all-
provided by law.7 encompassing.

xxx xxx xxx Prior to the passage of the aforestated Civil


Service Act of 1959, there were two recognized
In the case at bar, we are basically asked to instances when a position may be considered
determine if there is sufficient cause to warrant primarily confidential: Firstly, when the President,
the dismissal, not merely the suspension, of upon recommendation of the Commissioner of
respondent who, petitioner maintains, occupies a Civil Service, has declared the position to be
primarily confidential position. In this connection, primarily confidential; and, secondly, in the
Section 16 of Presidential Decree No. 18698 absence of such declaration, when by the nature
provides: of the functions of the office there exists "close
Exemption.—All positions in the Corporation, intimacy" between the appointee and appointing
whether technical, administrative, professional or power which insures freedom of intercourse
managerial are exempt from the provisions of the without embarrassment or freedom from
Civil Service Law, rules and regulations, and shall misgivings of betrayals of personal trust or
be governed only by the personnel management confidential matters of state.
policies set by the Board of Directors. All At first glance, it would seem that the instant case
employees of the casinos and related services falls under the first category by virtue of the
shall be classified as "Confidential" appointee. express mandate under Section 16 of Presidential
Petitioner argues that pursuant to the Decree No. 1869. An in-depth analysis, however,
aforequoted provision, respondent is a primarily of the second category evinces otherwise.
confidential employee. Hence, he holds office at When Republic Act No. 2260 was enacted on June
the pleasure of the appointing power and may be 19, 1959, Section 5 thereof provided that "the
removed upon the cessation of confidence in him non-competitive or unclassified service shall be
by the latter. Such would not amount to a removal composed of positions expressly declared by law
but only the expiration of his term. However, to be in the non-competitive or unclassified
there should be no lingering doubt as to the true service or those which are policy-determining,
import of said Section 16 of P.D. No. 1869. We primarily confidential, or highly technical in
have already definitively settled the same issue in nature." In the case of Piñero, et al. vs.
Civil Service Commission v. Salas,9 to wit: Hechanova, et al., the Court obliged with a short
In reversing the decision of the CSC, the Court of discourse there on how the phrase "in nature"
Appeals opined that the provisions of Section 16 came to find its way into the law, thus:
of Presidential Decree No. 1869 may no longer be "The change from the original wording of the bill
applied in the case at bar because the same is (expressly declared by law x x x to be policy-
deemed to have been repealed in its entirety by determining, etc.) to that finally approved and
Section 2(1), Article IX-B of the 1987 Constitution. enacted (‘or which are policy determining, etc. in
This is not completely correct. On this point, we nature’) came about because of the observations
approve the more logical interpretation advanced of Senator Tañada, that as originally worded the
by the CSC to the effect that "Section 16 of PD proposed bill gave Congress power to declare by
1869 insofar as it exempts PAGCOR positions from fiat of law a certain position as primarily
the provisions of Civil Service Law and Rules has confidential or policy-determining, which should
not be the case. The Senator urged that since the unclassified service shall be composed of
Constitution speaks of positions which are positions expressly declared by law to be in the
‘primarily confidential, policy-determining or non-competitive or unclassified service or those
highly technical in nature,’ it is not within the which are policy-determining, primarily
power of Congress to declare what positions are confidential, or highly technical in nature."
primarily confidential or policy-determining. ‘It is Likewise, Section 1 of the General Rules in the
the nature alone of the position that determines implementing rules of Presidential Decree No. 807
whether it is policy-determining or primarily states that "appointments in the Civil Service,
confidential.’ Hence, the Senator further except as to those which are policy-determining,
observed, the matter should be left to the ‘proper primarily confidential, or highly technical in
implementation of the laws, depending upon the nature, shall be made only according to merit and
nature of the position to be filled,’ and if the fitness to be determined as far as practicable by
position is ‘highly confidential’ then the President competitive examination." Let it be here
and the Civil Service Commissioner must emphasized, as we have accordingly italicized
implement the law. them, that these fundamental laws and legislative
or executive enactments all utilized the phrase "in
To a question of Senator Tolentino, ‘But in
nature" to describe the character of the positions
positions that involved both confidential matters
being classified.1âwphi1.nêt
and matters which are routine, x x x who is going
to determine whether it is primarily confidential?’ The question that may now be asked is whether
Senator Tañada replied: the Piñero doctrine—to the effect that
notwithstanding any statutory classification to the
‘SENATOR TAÑADA: Well, at the first instance, it is
contrary, it is still the nature of the position, as
the appointing power that determines that: the
may be ascertained by the court in case of
nature of the position. In case of conflict then it is
conflict, which finally determines whether a
the Court that determines whether the position is
position is primarily confidential, policy-
primarily confidential or not." xxx
determining or highly technical—is still controlling
Hence the dictum that, at least since the with the advent of the 1987 Constitution and the
enactment of the Civil Service Act of 1959, it is Administrative Code of 1987, Book V of which
the nature of the position which finally deals specifically with the Civil Service
determines whether a position is primarily Commission, considering that from these later
confidential, policy-determining or highly enactments, in defining positions which are
technical. And the Court in the aforecited case policy-determining, primarily confidential or highly
explicitly decreed that executive technical, the phrase "in nature" was deleted.
pronouncements, such as Presidential Decree No.
We rule in the affirmative. The matter was
1869, can be no more than initial determinations
clarified and extensively discussed during the
that are not conclusive in case of conflict. It must
deliberations in the plenary session of the 1986
be so, or else it would then lie within the
Constitutional Commission on the Civil Service
discretion of the Chief Executive to deny to any
provisions, to wit:
officer, by executive fiat, the protection of Section
4, Article XII (now Section 2[3], Article IX-B) of the "MR. FOZ: Which department of government has
Constitution. In other words, Section 16 of the power or authority to determine whether a
Presidential Decree No. 1869 cannot be given a position is policy-determining or primarily
literally stringent application without confidential or highly technical?
compromising the constitutionally protected right FR. BERNAS: The initial decision is made by the
of an employee to security of tenure. [italics legislative body or by the executive department,
supplied] but the final decision is done by the court. The
The doctrinal ruling enunciated in Piñero finds Supreme Court has constantly held that whether
support in the 1935 Constitution and was or not a position is policy-determining, primarily
reaffirmed in the 1973 Constitution, as well as in confidential or highly technical, it is determined
the implementing rules of Presidential Decree No. not by the title but by the nature of the task that
807, or the Civil Service Decree of the Philippines. is entrusted to it. For instance, we might have a
It may well be observed that both the 1935 and case where a position is created requiring that the
1973 Constitutions contain the provision, in holder of that position should be a member of the
Section 2, Article XII-B thereof, that Bar and the law classifies this position as highly
"appointments in the Civil Service, except as to technical. However, the Supreme Court has said
those which are policy-determining, primarily before that a position which requires mere
confidential, or highly technical in nature, shall be membership in the Bar is not a highly technical
made only according to merit and fitness, to be position. Since the term ‘highly technical’ means
determined as far as practicable by competitive something beyond the ordinary requirements of
examination." Corollarily, Section 5 of Republic the profession, it is always a question of fact.
Act No. 2260 states that "the non-competitive or
MR. FOZ: Does not Commissioner Bernas agree primarily confidential if at all, merely exempts the
that the general rule should be that the merit position from the civil service eligibility
system or the competitive system should be requirement." Accordingly, the Piñero doctrine
upheld? continues to be applicable up to the present and
is hereby maintained. Such being the case, the
FR. BERNAS: I agree that that should be the
submission that PAGCOR employees have been
general rule; that is why we are putting this as an
declared confidential appointees by operation of
exception.
law under the bare authority of CSC Resolution
MR. FOZ: The declaration that certain positions No. 91-830 must be rejected.
are policy-determining, primarily confidential or
Justice Regalado’s incisive discourse yields three
highly technical has been the source of practices
(3) important points: first, the classification of a
which amount to the spoils system.
particular position as primarily confidential,
FR. BERNAS: The Supreme Court has always said policy-determining or highly technical amounts to
that, but if the law of the administrative agency no more than an executive or legislative
says that a position is primarily confidential when declaration that is not conclusive upon the courts,
in fact it is not, we can always challenge that in the true test being the nature of the position.
court. It is not enough that the law calls it Second, whether primarily confidential, policy-
primarily confidential to make it such; it is the determining or highly technical, the exemption
nature of the duties which makes a position provided in the Charter pertains to exemption
primarily confidential. from competitive examination to determine merit
MR. FOZ: The effect of a declaration that a and fitness to enter the civil service. Such
position is policy-determining, primarily employees are still protected by the mantle of
confidential or highly technical—as an exception— security of tenure. Last, and more to the point,
is to take it away from the usual rules and Section 16 of P.D. 1869, insofar as it declares all
provisions of the Civil Service Law and to place it positions within PAGCOR as primarily confidential,
in a class by itself so that it can avail itself of is not absolutely binding on the courts.
certain privileges not available to the ordinary run Considerations vary so as to make a position
of government employees and officers. primarily confidential. Private secretaries are
FR. BERNAS: As I have already said, this indisputably primarily confidential employees.10
classification does not do away with the Those tasked to provide personal security to
requirement of merit and fitness. All it says is that certain public officials have also been deemed to
there are certain positions which should not be hold primarily confidential positions11 for obvious
determined by competitive examination. reasons: the former literally are responsible for
the life and well-being of the latter. Similar
For instance, I have just mentioned a position in treatment was accorded to those occupying the
the Atomic Energy Commission. Shall we require a posts of city legal officer12 and provincial
physicist to undergo a competitive examination attorney,13 inasmuch as the highly privileged
before appointment? Or a confidential secretary nature of the lawyer-client relationship mandates
or any position in policy-determining that complete trust and confidence must exist
administrative bodies, for that matter? There are betwixt them. National interest has also been
other ways of determining merit and fitness than adjudged a factor, such that the country’s
competitive examination. This is not a denial of permanent representative to the United Nations
the requirement of merit and fitness." was deemed to hold her post at the pleasure of
It is thus clearly deducible, if not altogether the Chief Executive.14
apparent, that the primary purpose of the framers As casino operations manager, Rilloraza’s duties
of the 1987 Constitution in providing for the and responsibilities are:
declaration of a position as policy-determining,
primarily confidential or highly technical is to JOB SUMMARY: The Casino Operations Manager
exempt these categories from competitive directs, controls and supervises the Operations
examination as a means for determining merit Division of the branch. He reports directly to the
and fitness. It must be stressed further that these Branch Manager or to the Branch Manager for
positions are covered by security of tenure, Operations in Metro Manila branches.
although they are considered non-competitive DUTIES AND RESPONSIBILITIES:
only in the sense that appointees thereto do not
1. Formulates marketing programs and plans of
have to undergo competitive examinations for
action for branch gaming operations in order to
purposes of determining merit and fitness. [italics
optimize revenue.
supplied]
2. Institutes and maintains a healthy, organized,
In fact, the CSC itself ascribes to this view as may
mentally alert, and highly motivated human
be gleaned from its questioned resolution wherein
resource for effective and efficient branch gaming
it stated that "the declaration of a position as
operations performance.
3. Takes measures to maintain and uphold the 22. Settles disputes arising from gaming
integrity of the casino games. operations that have not been effectively settled
by gaming managers and supervisors, and
4. Reviews, analyzes, and evaluates gaming table
enforces decisions on the interpretation of House
and slot machine operations reports, including
Rules, company policies, and procedures.
income performance.
23. Recommends to the Branch Manager the
5. Submits periodic reports to the Branch
banning of undesirable players.
Manager.
24. Orders the removal of customers or
6. Directs the opening and closing of gaming table
employees from the table gaming (sic) and slot
and slot machine areas.
machine area for justifiable reasons.
7. Directs the setting-up, closure or suspension of
25. Implements contingency plans in case of
operations of gaming tables and slot machine
emergencies to ensure the security and safety of
units when deemed necessary.
customers and staff.
8. Controls the requisition, storage, and issuance
26. Acts on customer complaints, suggestions,
of playing cards, gaming equipment and
and observations.
paraphernalia, operations keys, and accountable
receipts and slips. 27. Chairs the Branch Infractions Committee, the
Variance Committee, and other ad hoc
9. Ensures that gaming operations personnel
committees of the Operations Division.
adhere to the established House Rules, company
policies and procedures. 28. Represents the Operations Division in Branch
Management panel meetings.
10. Ensures that quality and efficient service is
extended to casino patrons in accordance with 29. Apprises the Branch Manager of any incident
the established House Rules, company policies of doubtful nature and of developments that
and procedures. require his immediate attention.
11. Directs and controls all activities of the Card 30. Performs other duties as may be designated
Shuffling Center and the Card Distribution Room. by the Branch Manager.
12. Issues directives, memoranda, and other Undoubtedly, respondent’s duties and
official communications on branch gaming responsibilities call for a great measure of both
operations matters. ability and dependability. They can hardly be
characterized as routinary, for he is required to
13. Directs the daily and periodic performance
exercise supervisory, recommendatory and
evaluation of operations personnel.
disciplinary powers with a wide latitude of
14. Requires written statements from operations authority. His duties differ markedly from those
personnel regarding disputes, reported we previously ruled as not primarily confidential:
irregularities and violations of House Rules, for instance, PAGCOR’s Internal Security Staff;15
company policies and procedures. Management and Audit Analyst I of the Economic
15. Issues or recommends disciplinary sanctions Intelligence and Investigation Bureau;16 a Special
against delinquent operations personnel, as well Assistant to the Governor of the Central Bank;17
as commendations to deserving ones. the Legal Staff of the Provincial Attorney;18
members of the Customs Police;19 the Senior
16. Upon the Branch Manager’s approval, issues Executive Assistant, Clerk I, Supervising Clerk I
preventive suspension to erring employees and Stenographer;20 and a Provincial
pending investigation. Administrator.21 In this sense, he is a tier above
17. Effects immediate changes in House Rules the ordinary rank-and-file in that his appointment
when deemed necessary, subject to management to the position entails faith and confidence in his
review. competence to perform his assigned tasks.
Lacking, therefore, is that amplitude of confidence
18. Approves table refill, chip yield, and dropbox reposed in him by the appointing power so as to
yield transactions, as well as the payment for qualify his position as primarily confidential.
progressive link super jackpot awards. Verily, we have observed that:
19. Directs the cancellation of progressive link [i]ndeed, physicians handle confidential matters.
super jackpot combinations. Judges, fiscals and court stenographers generally
20. Signs chip checks in behalf of the Branch handle matters of similar nature. The Presiding
Manager. and Associate Justices of the Court of Appeals
sometimes investigate, by designation of the
21. Approves complimentary food and beverages
Supreme Court, administrative complaints against
to deserving players and evaluates the same for
judges of first instance, which are confidential in
the possible extension of other amenities.
nature. Officers of the Department of Justice,
likewise, investigate charges against municipal Castillo who was seated also at the table. After
judges. Assistant Solicitors in the Office of the observing the large number of chips in front of
Solicitor General often investigate malpractice Ms. Castillo estimated at around P7M, respondent
charges against members of the Bar. All of these became convinced of the clarification given by
are "confidential" matters, but such fact does not Branch Manager Syhongpan and he must have
warrant the conclusion that the office or position relied also on the word of said top ranking
of all government physicians and all Judges, as PAGCOR official whose representation must
well as the aforementioned assistant solicitors ordinarily be accepted and accorded respect and
and officers of the Department of Justice are credence by a subordinate like him. xxx
primarily confidential in character.22 More importantly, the PAGCOR Adjudication
We further note that a casino operations manager Committee concluded that respondent actually
reports directly to the Branch Manager or, in attempted to stop the game where Syhongpan
Metro Manila branches, to the Branch Manager for was playing which was even utilized as basis by
Operations. It does not appear from the record to the PAGCOR Board in dismissing respondent. xxx
whom the Branch Manager (or the Branch xxx xxx xxx xxx
Manager for Operations, as the case may be)
reports. It becomes unmistakable, though, that The allegation that respondent Rilloraza allowed
the stratum separating the casino operations Syhongpan to place bets over and above the
manager from reporting directly to the higher allowable limit of P5,000.00 per deal is not
echelons renders remote the proposition of anchored on a correct premise. Respondent
proximity between respondent and the appointing Rilloraza has steadfastly maintained that he is of
power. There is no showing of that element of the belief that BM Syhongpan is not playing for
trust indicative of a primarily confidential position, himself but for Ms. Castillo. Thus, if Syhongpan is
as we defined it in De los Santos v. Mallare,23 to merely acting for the real casino player, then the
wit: policy of not allowing any PAGCOR official to bet
beyond P5,000.00 has no application. Respondent
Every appointment implies confidence, but much Rilloraza believed in good faith that the bet was
more than ordinary confidence is reposed in the not BM Syhongpan’s but of Ms. Castillo and should
occupant of a position that is primarily not be unduly punished for his honest belief. The
confidential. The latter phrase denotes not only same reason exists for the claim that respondent
confidence in the aptitude of the appointee for the allowed BM Syhongpan to play beyond 6:00 a.m.
duties of the office but primarily close intimacy This is non sequitur since Rilloraza never
which insures freedom of intercourse without entertained the idea that Syhongpan was the
embarrassment or freedom from misgivings of gambler.
betrayals of personal trust or confidential matters
of state. Lastly, if only to consummate respondent’s
alleged dishonesty and grave misconduct by
Necessarily, the point of contention now is corruptly profiting from said incident, he could
whether there was cause for the respondent’s have easily pocketed the ‘balato’ given by
separation from the service. On this point, having Syhongpan, but he never did, and in fact,
analyzed both parties’ arguments, we find that returned the money. xxx
the Civil Service Commission did not err in
declaring that Rilloraza was liable only for simple xxx xxx xxx xxx
neglect of duty. In the first place, there is no On the facilitation of the swap of a P500,000.00
evidence to sustain a charge of dishonesty. As the personal check for chips, this Court, after
latter term is understood, it implies a: considering the parties involved and the
Disposition to lie, cheat, deceive, or defraud; circumstances of the case, believes that
untrustworthiness; lack of integrity. Lack of respondent Rilloraza has judiciously performed all
honesty, probity or integrity in principle; lack of the acts necessary to protect the interests of
fairness and straightforwardness; disposition to PAGCOR and has acted as a prudent and
defraud, deceive or betray.24 reasonable man. It is evident that respondent had
the authority to approve the exchange of checks
In the case at bar, respondent’s explanation fails for gambling chips. In the exercise of such
to evince an inclination to lie or deceive, or that discretion, We find that the approval by Rilloraza
he is entirely lacking the trait of of the exchange was done with caution and
straightforwardness. We concur with the appellate circumspect [sic]. When he was approached by
court’s finding, thus: GAM Quito for endorsement of said personal
Available proof unmistakably demonstrate that checks per request of a customer, he immediately
upon seeing BM Syhongpan playing at Table No. approached COM Gonzales to verify the check
3BB, respondent Rilloraza at once, told him to who assured him that the check was good and in
stop. However, Syhongpan explained that he was fact guaranteed by Mr. Syhongpan, Davao City
merely playing for a customer, Ms. Corazon Branch Manager of PAGCOR. To be sure, he even
reconfirmed the same with Gonzales as he is the maximum of the penalty shall be imposed
more familiar with the systems and the customers where only aggravating and no mitigating
since he has been recalled to the branch for only circumstances are present. In turn, the
three (3) weeks. After approving the circumstances that may be properly considered
endorsement, he immediately tried to contact are:
SBM Advincula and BMO Cordero, to notify them Section 53. Extenuating, Mitigating,
of his action but none of them called back. In the Aggravating, or Alternative Circumstances. –
afternoon, both returned the call and were In the determination of the penalties to be
informed by respondent of the exchange of the imposed, mitigating, aggravating and alternative
chips for the check and presumably, the former circumstances attendant to the commission of the
ratified or acquiesced to the action of respondent offense shall be considered.1âwphi1.nêt
since there was no objection or complaint about
the matter. xxx The following circumstances shall be appreciated:
These same findings negate the conclusion that a. Physical illness
respondent is guilty of misconduct or conduct b. Good faith
prejudicial to the best interest of the service. In
Manuel v. Calimag, Jr.,25 we defined misconduct, c. Taking undue advantage of official position
thus: d. Taking undue advantage of subordinate
Misconduct in office has been authoritatively e. Undue disclosure of confidential information
defined by Justice Tuazon in Lacson v. Lopez in
these words: "Misconduct in office has a definite f. Use of government property in the commission
of the offense
and well-understood legal meaning. By uniform
legal definition, it is a misconduct such as affects g. Habituality
his performance of his duties as an officer and not h. Offense is committed during office hours and
such only as affects his character as a private
within the premises of the office or building
individual. In such cases, it has been said at all
times, it is necessary to separate the character of i. Employment of fraudulent means to commit or
the man from the character of the officer x x x. It conceal the offense
is settled that misconduct, misfeasance, or j. Length of service in the government
malfeasance warranting removal from office of an
officer, must have direct relation to and be k. Education, or
connected with the performance of official duties l. Other analogous circumstances
amounting either to maladministration or willful,
intentional neglect and failure to discharge the Nevertheless, in the appreciation thereof, the
duties of the office x x x. same must be invoked or pleaded by the proper
party, otherwise, said circumstances shall not be
Differently propounded in Canson v. Garchitorena, considered in the imposition of the proper
et al.,26 misconduct is "any unlawful conduct on penalty. The Commission, however, in the interest
the part of a person concerned in the of substantial justice may take and consider these
administration of justice prejudicial to the rights of circumstances.
parties or to the right determination of the cause.
It generally means wrongful, improper or unlawful We find that the Civil Service Commission, as
conduct motivated by a premeditated, obstinate affirmed by the Court of Appeals, correctly
or intentional purpose. The term, however, does attributed good faith on the part of respondent.
not necessarily imply corruption or criminal intent. Accordingly, the modified penalty imposed by the
On the other hand, the term ‘gross’ connotes Civil Service Commission on the respondent which
something ‘out of all measure; beyond allowance; was affirmed by the Court of Appeals, was proper
not to be excused; flagrant; shameful’." From the under the premises.
facts given, absent is that element of intent to do WHEREFORE, the petition is hereby DENIED for
wrong against petitioner. lack of merit. The Decision dated August 31, 1999
CSC Resolution No. 991936 dated August 31, as well as the Resolution dated November 29,
1999 classifies simple neglect of duty as a less 1999, rendered by the Court of Appeals in CA-G.R.
grave offense punishable as a first offense by SP No. 51803 are hereby AFFIRMED. No costs.
suspension of one (1) month and one (1) day to SO ORDERED.
six (6) months.27 In the imposition of the proper
Bellosillo, Mendoza, Quisumbing, Buena, JJ.,
penalty, Section 54 thereof provides, as follows:
concur.
(a) the minimum of the penalty shall be imposed
where only mitigating and no aggravating
circumstances are present; (b) the medium of the Footnote
penalty shall be imposed where no mitigating and
aggravating circumstances are present; and (c)
1
Justice Presbitero J. Velasco, Jr., ponente; Justice CIVIL SERVICE COMMISSION and LEONARDA
Fermin A. Martin, Jr. and Justice Bennie A. Adefuin- D. DE LA PAZ, respondents.
de la Cruz, concurring.
2
Annex "C" of the Petition, Rollo, pp. 62-70. MEDIALDEA, J.:
3
Annex "D" of the Petition, Rollo, pp. 71-72. This petition for certiorari with prayer for the
4
Decision, Annex "A" of the Petition, Rollo, pp. 33- issuance of a restraining order seeks to nullify the
57. resolutions issued by the respondent Civil Service
5 Commission, namely: (1) Resolution No. 88-820
Annex "E" of the Petition, Rollo, pp. 73-80.
dated November 7, 1988 reversing the decision of
6
Annex "B" of the Petition, Rollo, pp. 59-60. the Merit Systems Protection Board dated
7
Constitution, Art. IX-B, Sec. 2. February 5, 1988 which sustained the decision of
8
the Secretary of Education, Culture and Sports
Entitled "Consolidating and Amending dated May 4, 1987 upholding the appointment of
Presidential Decree Nos. 1067-A, 1067-B, 1067-C, Mr. Victor A. Aquino as Supply Officer I in the
1399 and 1632, Relative to the Franchise and DECS, Division of San Pablo City; and (2)
Powers of the Philippine Amusement and Gaming Resolution No. 90-224 dated February 27, 1990
Corporation (PAGCOR), dated July 11, 1983." denying the motion for reconsideration with
9
274 SCRA 414, 420-427 (1997). prayer for issuance of temporary restraining order
10 for lack of merit.
Corpus v. Cuaderno, Sr., 13 SCRA 591, 596
(1965). The antecedent facts are as follows:
11
Borres v. Court of Appeals, 153 SCRA 120, 132 Petitioner Victor A. Aquino, then holding the
(1987). position of Clerk II, Division of City Schools of San
12 Pablo City, was designated on July 20, 1984 as
Cadiente v. Santos, 142 SCRA 280, 284 (1986), Officer-in-Charge of the Division Supply Office by
citing Claudio v. Subido, 40 SCRA 481 (1971). the DECS Regional Director Saturnino R. Magturo
13
Griño v. Civil Service Commission, 194 SCRA (Annex "H", petition, p. 55, Rollo) in view of the
458, 466 (1991). retirement of the Supply Officer I, Mr. Jose I.
14 Aviquivil.
Santos v. Macaraig, 208 SCRA 74, 84 (1992).
15 Prior to such designation, or from the period
Civil Service Commission v. Salas, supra.
February 16, 1984 to June 16, 1984, petitioner
16
Tria v. Sto. Tomas, 199 SCRA 833, 840-841 was designated as Property Inspector and In-
(1991). Charge of the Supply Office performing the duties
17
Corpuz v. Cuaderno, supra. and responsibilities of the Supply Officer I (p. 55,
18
Rollo).
Griño v. Civil Service Commission, supra.
19
Two (2) years thereafter, or on September 19,
Piñero v. Hechanova, 18 SCRA 417, 424 (1966). 1986, the Division Superintendent of City Schools
20
Ingles v. Mutuc, 26 SCRA 171, 177 (1969). of San Pablo City, Milagros Tagle, issued a
21 promotional appointment to private respondent
Laurel V v. Civil Service Commission, 203 SCRA Leonarda D. de la Paz as Supply Officer I in the
195, 204 (1991). DECS Division of San Pablo City. She assumed and
22
Ingles v. Mutuc, supra. performed the duties and functions of the position
23 and received the compensation and benefits
87 Phil. 289, 298 (1950).
therefor.
24
Black’s Law Dictionary, Sixth Ed., p. 468, 1990.
At the time of her appointment, private
25
307 SCRA 657, 661-662 (1999). respondent was then holding the position of Clerk
26
311 SCRA 268, 285 (1999). II, Division of City Schools of San Pablo City. From
27
August 25, 1976 to September 1983, she was
Sec. 52(B). designated as Assistant to the Supply Officer
Republic of the Philippines (DECS decision, p. 31, Rollo). The Civil Service
SUPREME COURT Regional Office IV approved her appointment as
Manila permanent "provided that there is no pending
administrative case against the appointee, no
EN BANC pending protest against the appointment, nor any
decision by competent authority that will
adversely affect the approval of (the)
G.R. No. 92403 April 22, 1992
appointment" (Annex "A", Comment of CSC, p
VICTOR A. AQUINO, petitioner, 164, Rollo).
vs.
One (1) month after, or on October 20, 1986 private respondent de la Paz to her position as
petitioner filed a protest with the DECS Secretary Supply Officer I, DECS, Division of San Pablo City
questioning the qualification and competence of under her previously approved appointment
private respondent for the position of Supply (Annex "B", petition, pp. 26-29, Rollo).
Officer I. From said decision, petitioner filed a motion for
In a decision dated May 4, 1987, DECS Secretary reconsideration with prayer for issuance of a
Lourdes R. Quisumbing sustained the protest of temporary restraining order. Finding no merit to
petitioner and revoked the appointment of private the motion for reconsideration filed by petitioner,
respondent as Supply Officer I thus: public respondent CSC issued Resolution No. 90-
224 dated February 27, 1990 denying said motion
From the foregoing comparative statement of the
(Annex "A", petition, pp. 21- 24, Rollo).
qualifications of Mr. Aquino and Mrs. de la Paz,
apparently the former has a decided advantage Hence, this petition seeking the reversal of public
over the latter in terms of education, experience respondent Commission's action on petitioner's
and training. Further examination of the appointment.
comparative statement shows that Mrs. de la Paz Two (2) interrelated issues on the extent of
has had no relevant in-service training course authority of the Civil Service Commission to pass
attended and completed. Accordingly, therefore, upon the contested appointments were raised by
Mr. Aquino is preferred to Mrs. de la Paz for petitioner which could be simplified into whether
appointment as Supply Officer I. or not public respondent Civil Service Commission
xxx xxx xxx committed grave abuse of discretion in revoking
the appointment of petitioner Victor A. Aquino as
Based on all the foregoing and as records further
Supply Officer I in the DECS Division of San Pablo
show that Mr. Aquino is competent and qualified
City as it found private respondent Leonarda de la
to hold the subject position and possesses the
Paz better qualified.
eligibility requirement, this Office finds the instant
protest meritorious and hereby rules and so rules In assailing the two (2) CSC Resolutions revoking
that Mr. Aquino be appointed Supply Officer I in his appointment, petitioner invokes the ruling of
place of Mrs. de la Paz, whose appointment this Court in the case of Santiago v. Civil Service
thereto is deemed revoked. (p. Annex "C", pp. 30- Commission, G.R. No. 81467, October 27, 1989,
31, Rollo) 178 SCRA 733 and Galura v. Civil Service
Commission, G.R. 85812, June 1, 1989 (En Banc
Private respondent then filed her petition for
resolution) that the Civil Service Commission has
reconsideration of the aforequoted DECS decision
no authority to revoke an appointment on the
but the same was denied by Secretary
ground that another person is more qualified for a
Quisumbing in a Resolution dated August 11,
particular position for that would have constituted
1967.
an encroachment on the discretion vested solely
On the bases of the aforementioned rulings of the in the appointing authority. The Civil Service
DECS Secretary, petitioner Aquino was issued a Commission cannot exceed its power by
permanent appointment dated August 11, 1987 substituting its will for that of the appointing
as Supply Officer I by the DECS Regional Director authority.
Pedro San Vicente effective October 26, 1987. On
In support of petitioner's cause, the Solicitor
the date of effectivity of his appointment,
General stresses the wide latitude of discretion
petitioner assumed the duties and functions of the
given to the appointing authority in the selection
position. The said appointment was approved by
and appointment of qualified persons to vacant
the Civil Service Regional Office IV on October 27,
positions in the civil service which was
1987.
emphasized by the Court as rationale for the rule
For her part, private respondent de la Paz filed on laid down in Luego v. Civil Service Commission,
October 16, 1987 a notice of appeal with motion G.R. No. 69137, August 5, 1986, 143 SCRA 327,
to maintain status quo to the Merit Systems Central Bank v. CSC, G.R. No. 80455-56, April 10,
Protection Board (MSPB) which, on February 5, 1989, 171 SCRA 744, Patagoc v. CSC, G.R. No.
1988, rendered a decision upholding the 90229, May 14, 1990, 185 SCRA 411, that public
appointment of Aquino as Supply Officer I (Annex respondent CSC, not being the "appointing power"
"D", petition pp. 33-35, Rollo). in contemplation of law, has no authority to
From the decision of the MSPB, private revoke an appointment on the ground that
respondent appealed to public respondent Civil another person is more qualified for a particular
Service Commission (CSC). position and that the Commission has no authority
to direct the appointment of a substitute of its
In Resolution No, 88-820 dated November 7, choice.
1988, public respondent CSC found the appeal of
private respondent meritorious, thus revoking the We have consistently applied the above doctrine
appointment of petitioner Aquino and restoring in many cases with similar factual circumstances,
but we see no compelling reason to apply the ELIGIBILITY: Supply Officer; Career Service
same in the instant case. In the cases cited (Professional)
above, We ruled that the Civil Service Commission It is well-settled that once an appointment is
has no authority to revoke an appointment simply issued and the moment the appointee assumes a
because it (CSC) believed that another person is position in the civil service under a completed
better qualified than the appointee for it would appointment, he acquires a legal, not merely
constitute an encroachment on the discretion equitable right (to the position), which is
solely vested on the appointing authority. The protected not only by statute, but also by the
situation is different as in the instant case, where Constitution, and cannot be taken away from him
the Civil Service Commission revoked the either by revocation of the appointment, or by
appointment of the successful protestant, removal, except for cause, and with previous
petitioner herein, principally because the right to notice and hearing (Mitra v. Subido, G.R No. L-
security of tenure of the prior appointee, private 21691, September 15, 1967, 21 SCRA 127.
respondent herein, to the contested position had
already attached (see CSC decision, pp. 28-29, There is also authority for the rule that when the
Rollo). It must be noted that public respondent appointing power has once acted and the
CSC did not direct the appointment of a substitute appointee has accepted the office and done what
of its choice. It merely restored the appointment is required of him upon its acceptance, his title to
of private respondent who was first appointed to the office becomes complete, and he can then be
the contested position. removed only in the regular way (Mechem, Law of
Public Offices and Officers, Sec. 461, p. 294, citing
The records show that private respondent was Marbury v. Madison, 1 Cranch (U.S.) 137). The
issued a permanent appointment on September appointing power can not effect his removal
19, 1986 as Supply Officer I in the DECS Division indirectly by rescinding or revoking his
of San Pablo City effective September 30, 1986. appointment after it is complete.
On the basis of the of said appointment which was
approved by the Civil Service Regional Office No. There is thus reasonable ground for the rule that
IV, private respondent assumed and performed the moment the discretionary power of
the duties and functions of the position as Supply appointment has been exercised and the
Officer I and received the compensation and appointee assumed the duties and functions of
benefits of the said position in accordance with the position, the said appointment cannot be
the mandate of Section 9 par.(h) of the Civil revoked by the appointing authority on the
Service Law (P.D. 807, as amended). In ground merely that the protestant is more
consonance with the doctrine laid down in qualified than the first appointee, subject however
Villanueva v. Balallo, G.R. No. L-17745, October to the condition that the first appointee should
31, 1963, 9 SCRA 407, that an appointment is possess the minimum qualifications required by
complete when the last act required of the law. Otherwise, the security of tenure guaranteed
appointing power has been performed, but later by Article IX-B, Section 2 par. (3) of the 1987
qualified in Favis v. Rupisan, G.R. No. L-22823, Constitution would be rendered meaningless if the
May 19, 1966, 17 SCRA 190, that the acts of the appointing authority is allowed to flip-flop in
head of a department or office making the exercising its discretionary power of appointment.
appointment and the Commissioner of Civil While a protest is a made of action that may be
Service acting together, though not concurrently, availed of by the aggrieved party to contest the
but consecutively, are necessary to make an appointment made, the protest must be "for
appointment complete, the permanent cause" or predicated on those grounds provided
appointment extended to private respondent, for under Section 19 par. (6) of the Civil Service
under the circumstances of the case, is deemed Law (P.D. 807), namely: (1) that the appointee is
complete. As such, she is entitled to the not qualified; (2) that the appointee is not the
protection of the law against unjust removal. next-in-rank; and (3) in case of appointment by
The conclusion of respondent Commission in the transfer, reinstatement, or by original
questioned decision that private respondent is appointment, that the protestant is not satisfied
more qualified than petitioner merely supports with the written special reason or reasons given
the validity of the restoration of private by the appointing authority.
respondent to her previously approved We have defined the concept of "for cause" in
appointment considering that she meets the connection with removal of public officers in the
prescribed qualification standards required of the case of De los Santos v. Mallare, G.R. No. L-3881,
position of Supply Officer I and the appropriate August 31, 1950, 87 Phil. 289, as follows: "It
civil service eligibility, to wit: means for reasons which the law and sound public
EDUCATION: Bachelor's degree with training in policy recognized as sufficient warrant for
Supply Management removal, that is legal cause, and not merely
EXPERIENCE: None required causes which the appointing power in the exercise
of discretion may deem sufficient. It is implied
that officers may not be removed at the mere will of petitioner dated August 11, 1987 was issued
of those vested with the power of removal, or with undue haste before the finality of the denial
without any cause. Moreover, the cause must of the motion for reconsideration.
relate to and affect the administration of the While it is true that the appointing authority has a
office, and must be restricted to something of a wide latitude of discretion in making his choice in
substantial nature directly affecting the rights and the selection and appointment of qualified
interests of the public." persons to vacant positions in the civil service, we
The ground relied upon by petitioner in his protest cannot, however, give a stamp of approval to
that he is more qualified than private respondent such a procedural irregularity in extending
in terms of education, experience and training appointments, as in the instant case, to the
does not fall within the meaning of "for cause" prejudice of the right to security of tenure of the
contemplated by Article IX-B, Section 2 par. (3) of incumbent to the position.
the 1987 Constitution which would warrant the ACCORDINGLY, the petition is DENIED. The
revocation, if not removal, of the appointment of decision dated May 4, 1987 and the resolution
private respondent. Neither does it fall under the dated August 11, 1987 of the respondent Civil
grounds of appeal contemplated under Section 19 Service Commission are hereby AFFIRMED. The
par. (6) of the Civil Service Law (P.D. 807). Secretary of the Department of Education, Culture
Therefore, the protest of petitioner did not and Sports is hereby directed to restore private
adversely affect the approval of the appointment respondent Leonarda de la Paz to her previously
of private respondent. approved appointment as Supply Officer I, DECS,
Even on the assumption that the revocation of Division of San Pablo City.
private respondent's appointment was validly SO ORDERED.
exercised by DECS Secretary Quisumbing, still the
appointment extended to petitioner was tainted Narvasa, C.J., Gutierrez, Jr., Cruz, Paras, Padilla,
with irregularity as it was issued before the Bidin, Griño-Aquino, Regalado, Davide, Jr.,
finality of the decision on the protest in violation Romero and Nocon, JJ., concur.
of CSC Resolution No. 83-343 which prohibits the Bellosillo, J., took no part
issuance of an appointment to protestant
(petitioner) if the protest case is not yet finally
resolved, since there is no vacancy in the position
pending resolution of the protest case. There can
Separate Opinions
be no appointment to a non-vacant position. The
incumbent must first be legally removed or his MELENCIO-HERRERA, J., dissenting:
appointment validly terminated (Costin v. I am constrained to take exception to the
Quimbo, G.R. No. L-32271, January 27, 1983, 120
conclusion of the majority that the right to
SCRA 159). An appointment to an office which is security of tenure of private respondent to the
not vacant is null and void ab initio (Morata v.
contested position had already attached.
Court of Appeals, G.R. No. L-18975, May 25, 1964,
11 SCRA 42). It should be noted that private respondent's
appointment on 19 September 1986 was
CSC Resolution No. 83-343 provides, thus: approved as permanent by the Civil Service
An appointment though contested shall take Regional Office IV subject to certain conditions,
effect immediately upon issuance if the appointee namely, "(1) that there is no pending
assumes the duties of the position and (the) administrative case against the appointee; (2) no
appointee is entitled to receive the salary pending protest against the appointment, (3) nor
attached to the position. Likewise such any decision by competent authority that will
appointment shall become ineffective in case the adversely affect the approval of (the)
protest is finally resolved in favor of the appointment" (numbering supplied).
protestant, in which case the protestee shall be In this case, a protest against the appointment
reverted to his former position. (p. 223, Rollo)
was timely filed by petitioner on 20 October 1986
Records reveal that the decision of the DECS questioning the qualification and competence of
Secretary revoking the appointment of private private respondent. The protest was sustained by
respondent was rendered on May 4, 1987 and the the Secretary of the Department of Education,
motion for reconsideration filed by private Culture and Sports (DECS) on 4 May 1987 on the
respondent was denied on August 11, 1987. The ground that petitioner had a "decided advantage
appointment issued to petitioner as Supply Officer over private respondent in terms of education,
I was dated August 11, 1987 and he assumed the experience and training." Petitioner was thus
position on October 26, 1987 (date of effectivity appointed in place of private respondent whose
of his appointment) as reported by the Schools appointment was deemed revoked. That was a
Division Superintendent of San Pablo City (pp. 77- decision by competent authority adversely
78, Rollo). From all indications, the appointment affecting the approval of private respondent's
appointment. Conditions Nos. 2 and 3 having conditions that effectively hindered it from
supervened, private respondent could not have acquiring that status, namely, the timely protest
assumed the contested position under a and the decision by competent authority
completed appointment. Consequently, private adversely affecting it. By reason thereof, there
respondent had acquired no legal right to security was no completed appointment much less any
of tenure that would have entitled her to removal security of tenure to speak of that would have
only "for cause." entitled private respondent to the protection of
the law against unjust removal (pp. 7-8, Decision).
On the contrary, it was petitioner who was issued
a permanent appointment by the DECS Regional Upon the foregoing considerations, I vote to grant
Director on 11 August 1987, effective on 26 the Petition. It is petitioner Aquino who should be
October 1987 when petitioner assumed the duties appointed to the contested position, not private
and functions of the position. That appointment respondent De la Paz, following our consistent
was approved by the Civil Service Regional Office pronouncements on the matter, espoused in the
IV on 27 October 1987, without any qualifications strongest terms in some instances, that the CSC
or conditions. exceeds its power when it substitutes its will for
that of the appointing authority.
Private respondent's Motion for Reconsideration of
the DECS decision on petitioner's protest was Feliciano, J., concurs.
denied by that department on 11 August 1987. A Separate Opinions
notice of appeal was filed by private respondent
to the Merit Systems Protection Board (MSPB) on MELENCIO-HERRERA, J., dissenting:
16 October 1987. On 5 February 1988, the MSPB I am constrained to take exception to the
upheld petitioner's appointment. conclusion of the majority that the right to
On appeal, however, by private respondent to the security of tenure of private respondent to the
Civil Service Commission, the latter body, on 7 contested position had already attached.
November 1988, found the appeal meritorious, It should be noted that private respondent's
revoked petitioner's appointment "under the appointment on 19 September 1986 was
previously approved appointment, " on the approved as permanent by the Civil Service
ground that private respondent was "better Regional Office IV subject to certain conditions,
qualified" (Decision, p. 5). The CSC denied the namely, "(1) that there is no pending
reconsideration sought by petitioner on 27 administrative case against the appointee; (2) no
February 1990. pending protest against the appointment, (3) nor
Under the circumstances, it can not be denied any decision by competent authority that will
that, in resolving private respondent's appeal to adversely affect the approval of (the)
it, the CSC had substituted its own choice for that appointment" (numbering supplied).
of the appointing authority. The general rule, In this case, a protest against the appointment
therefore, must apply: the discretion exercised by was timely filed by petitioner on 20 October 1986
the appointing power, in extending an questioning the qualification and competence of
appointment to a given position to one of two private respondent. The protest was sustained by
employees possessing the requisite minimum the Secretary of the Department of Education,
qualifications for the position, will not generally be Culture and Sports (DECS) on 4 May 1987 on the
interfered with and must be sustained. The Civil ground that petitioner had a "decided advantage
Service Commission has no authority to revoke over private respondent in terms of education,
the said appointment simply because it believes experience and training." Petitioner was thus
that another employee is better qualified for that appointed in place of private respondent whose
would constitute an encroachment on the appointment was deemed revoked. That was a
discretion vested solely in the appointing decision by competent authority adversely
authority (Dr. Mariquita Mantala v. Hon. Ignacio affecting the approval of private respondent's
Salvador, G.R. No. 101646, February 13, 1992, appointment. Conditions Nos. 2 and 3 having
citing Luego v. Civil Service Commission, 143 supervened, private respondent could not have
SCRA 327; Central Bank v. Civil Service assumed the contested position under a
Commission, 171 SCRA 744; and Santiago, Jr. v. completed appointment. Consequently, private
Civil Service Commission, 178 SCRA 733). respondent had acquired no legal right to security
To state that respondent CSC "did not direct the of tenure that would have entitled her to removal
appointment of a substitute of its choice but only "for cause."
merely restored the appointment of private On the contrary, it was petitioner who was issued
respondent who was first appointed to the a permanent appointment by the DECS Regional
contested position" (p. 7, Decision) is misleading Director on 11 August 1987, effective on 26
and inaccurate. There could have been no October 1987 when petitioner assumed the duties
"restoration" as private respondent's appointment and functions of the position. That appointment
never attained permanency by reason of the
was approved by the Civil Service Regional Office pronouncements on the matter, espoused in the
IV on 27 October 1987, without any qualifications strongest terms in some instances, that the CSC
or conditions. exceeds its power when it substitutes its will for
that of the appointing authority.
Private respondent's Motion for Reconsideration of
the DECS decision on petitioner's protest was Feliciano, J., concurs.
denied by that department on 11 August 1987. A Republic of the Philippines
notice of appeal was filed by private respondent SUPREME COURT
to the Merit Systems Protection Board (MSPB) on Manila
16 October 1987. On 5 February 1988, the MSPB
upheld petitioner's appointment. EN BANC
On appeal, however, by private respondent to the G.R. No. L-3881 August 31, 1950
Civil Service Commission, the latter body, on 7 EDUARDO DE LOS SANTOS, petitioner,
November 1988, found the appeal meritorious, vs.
revoked petitioner's appointment "under the GIL R. MALLARE, LUIS P. TORRES, in his
previously approved appointment, " on the capacity as City Mayor, PANTALEON
ground that private respondent was "better PIMENTEL, in his capacity as City Treasurer
qualified" (Decision, p. 5). The CSC denied the and RAFAEL USON, in his capacity as City
reconsideration sought by petitioner on 27 Auditor, respondents.
February 1990.
Francisco S. Reyes for petitioner.
Under the circumstances, it can not be denied Office of the Solicitor General Felix Bautista
that, in resolving private respondent's appeal to Angelo and Solicitor Augusto Luciano for
it, the CSC had substituted its own choice for that respondents.
of the appointing authority. The general rule, Jose P. Laurel and Abelardo Subido as amici
therefore, must apply: the discretion exercised by curiae.
the appointing power, in extending an
appointment to a given position to one of two TUASON, J.:
employees possessing the requisite minimum This is an original action of quo warranto
qualifications for the position, will not generally be questioning the legality of the appointment of
interfered with and must be sustained. The Civil respondent Gil R. Mallare to the office of city
Service Commission has no authority to revoke engineer for the City of Baguio which the
the said appointment simply because it believes petitioner occupied and claims to be still
that another employee is better qualified for that occupying. The real issue however is the legality
would constitute an encroachment on the of the petitioner's removal from the same office
discretion vested solely in the appointing which would be the effect of Mallare's
authority (Dr. Mariquita Mantala v. Hon. Ignacio appointment if the same be allowed to stand. It is
Salvador, G.R. No. 101646, February 13, 1992, the petitioner's contention that under the
citing Luego v. Civil Service Commission, 143 Constitution he can not be removed against his
SCRA 327; Central Bank v. Civil Service will and without cause. The complaint against the
Commission, 171 SCRA 744; and Santiago, Jr. v. other respondents has to do merely with their
Civil Service Commission, 178 SCRA 733). recognition of Mallare as the lawful holder of the
To state that respondent CSC "did not direct the disputed office and is entirely dependent upon the
appointment of a substitute of its choice but result of the basic action against the last-
merely restored the appointment of private mentioned respondent (Mallare).
respondent who was first appointed to the Stripped of details unessential to the solution of
contested position" (p. 7, Decision) is misleading the case, the facts are that Eduardo de los Santos,
and inaccurate. There could have been no the petitioner, was appointed City Engineer of
"restoration" as private respondent's appointment Baguio on July 16, 1946, by the President,
never attained permanency by reason of the appointment which was confirmed by the
conditions that effectively hindered it from Commission on Appointments on August 6, and on
acquiring that status, namely, the timely protest the 23rd of that month, he qualified for and began
and the decision by competent authority to exercise the duties and functions of the
adversely affecting it. By reason thereof, there position. On June 1, 1950, Gil R. Mallare was
was no completed appointment much less any extended an ad interim appointment by the
security of tenure to speak of that would have President to the same position, after which, on
entitled private respondent to the protection of June 3, the Undersecretary of the Department of
the law against unjust removal (pp. 7-8, Decision). Public Works and Communications directed
Upon the foregoing considerations, I vote to grant Santos to report to the Bureau of Public Works for
the Petition. It is petitioner Aquino who should be another assignment. Santos refused to vacate the
appointed to the contested position, not private office, and when the City Mayor and the other
respondent De la Paz, following our consistent officials named as Mallare's co-defendants
ignored him and paid Mallare the salary directly affecting the rights and interests of the
corresponding to the position, he commenced public."(43 Am. Jur., 47, 48.)
these proceedings. Reconsideration of the decision in Lacson vs.
The petitioner rests his case on Article XII of the Romero as far as officers in the unclassified
Constitution, section 4 of which reads: "No officer service are concerned is urged. It is contended
or employee in the Civil Service shall be removed that only officers and employees in the classified
or suspended except for cause as provided by service should be brought within the purview of
law." Article XII of the Constitution.
It is admitted in respondents' answer that the City Section 1 of this article ordains: "A Civil Service
Engineer of Baguio "belongs to the unclassified embracing all branches and subdivisions of the
service." And this Court, in an exhaustive opinion Government shall be provided by law.
by Mr. Justice Montemayor in the case of Lacson Appointments in the Civil Service, except as those
vs. Romero, 47 Off. Gaz., 1778, involving the which are policy-determining, primarily
office of provincial fiscal, ruled that officers or confidential or highly technical in nature, shall be
employees in the unclassified as well as those in made only according to merit and fitness, to be
the classified service are protected by the above- determined as far as practicable by competitive
cited provision of the organic law. But there is this examination." The first clause is a definition of the
difference between the Lacson case and the case scope of Civil Service, the men and women which
at bar: Section 2545 of the Revised Administrative section 4 protects. It seems obvious from that
Code, which falls under Chapter 61 entitled "City definition that the entire Civil Service is
of Baguio," authorizes the Governor General (now contemplated, except positions "which are policy-
the President) to remove at pleasure any of the determining, primarily confidential or highly
officers enumerated therein, one of whom is the technical in nature." This theory is confirmed by
city engineer. The first question that presents the enactment of Commonwealth Act No. 177 on
itself is, is this provision still in force? November 30, 1936 to implement Article XII of the
Constitution. Commonwealth Act No. 177 explains
Section 2 of Article XVI of the Constitution
Civil Service almost in the identical words of that
declares that "All laws of the Philippine Islands
article of the organic law. As a contemporaneous
shall continue in force until the inauguration of
construction, this Act affords an index to the
the Commonwealth of the Philippines; thereafter,
meaning of Civil Service as conceived by the
such laws shall remain operative, unless
framers of the Constitution. "The principle of
inconsistent with this Constitution, until amended,
contemporaneous construction may be applied to
altered, modified, or repealed by the Congress of
the construction given by the legislature to the
the Philippines, . . . ."
constitutional provisions dealing with legislative
It seems plain beyond doubt that the provision of powers and procedure. Though not conclusive,
section 2545 of the Revised Administrative Code, such interpretation is generally conceded as being
he (Governor-General now President) may remove entitled to great weight." (U.S. vs. Sprague, 282
at pleasure any of the said appointive officers," is U.S., 716; 75 L. ed. 640; 51 S. Ct., 220; 71 A.L.R.,
incompatible with the constitutional inhibition that 1381; Den ex dem. Murray vs. Hoboken Land and
"No officer or employee in the Civil Service shall Improv. Co., 18 How. [U.S.], 272; 15 L. ed., 372;
be removed or suspended except for cause as Clark vs. Boyce, 20 Ariz., 544; 185 P., 136, citing
provided by law." The two provisions are mutually R.C.L.; 11 Am. Jur. 699.) The principle of express
repugnant and absolutely irreconcilable. One in mention and implied exclusion may be made use
express terms permits what the other in similar of also to drive home this point.
terms prohibits.
We are led to the same conclusion by the existing
The Constitution leaves it to the Congress to provisions at the time of the adoption of the
provide for the cause of removal, and it is Constitution. Civil Service as embracing both
suggested that the President's pleasure is itself a classes of officers and employees possessed
cause. The phrase "for cause" in connection with definite legal and statutory meaning when the
the removals of public officers has acquired a Constitution was approved. Section 670 of the
well-defined concept. "It means for reasons which Revised Administrative Code already provided
the law and sound public policy recognized as that "Persons in the Philippine civil service pertain
sufficient warrant for removal, that is, legal cause, either to the classified service," and went on to
and not merely causes which the appointing say that "The classified service embraces all not
power in the exercise of discretion may deem expressly declared to be in the unclassified
sufficient. It is implied that officers may not be service." Then section 671 described persons in
removed at the mere will of those vested with the the unclassified service as "officers, other than
power of removal, or without any cause. the provincial treasurers and assistant directors of
Moreover, the cause must relate to and affect the bureaus or offices, appointed by the President of
administration of the office, and must be the Philippines, with the consent of the
restricted to something of a substantial nature
Commission on Appointments of the National The adoption of the "merit system" in government
Assembly, and all other officers of the service has secured efficiency and social justice. It
government whose appointments are by law eliminates the political factor in the selection of
vested in the President of the Philippines alone." civil employees which is the first essential to an
efficient personnel system. It insures equality of
The rules of the construction inform us that the
opportunity to all deserving applicants desirous of
words use in the constitution are to be given the
a career in the public service. It advocates a new
sense they have in common use. (Okanogan
concept of the public office as a career open to all
Indians vs. United States, 279, U.S., 665; 64
and not the exclusive patrimony of any party or
A.L.R., 1434; 73 Law ed., 894.) It has been said
faction to be doled out as a reward for party
that we must look to the history of the times,
service.
examine the state of things existing when the
Constitution was framed and adopted, (Rhode The "merit system" was adopted only after the
Islands vs. Massachusetts, 12 Pet., 657; 9 Law nations of the world took cognizance of its merits.
ed., 1233), and interpret it in the light of the law Political patronage in the government service was
then in operation. (Mattox vs. United States, 156, sanctioned in 1879 by the Constitutional right of
U.S., 237; 39 Law ed., 409.) President of the United States to act alone in the
matter of removals. From the time of Andrew
Attention is drawn to supposed inconveniences of
Jackson the principle of the "To the victor belongs
tying the hands of the appointing power in
the spoils' dominated the Federal Government.
changing and shifting officers in the unclassified
The system undermined moral values and
service. "If — it is argued — all important officers
destroyed administrative efficiency.
and employees of the government falling within
the unclassified service as enumerated in section Since the establishment of the American Regime
671 of the Revised Administrative Code as in the Philippines we have enjoyed the benefits of
amended by Commonwealth Act No. 177, may not the "merit system." The Schurmann Commission
be removed by the President except for cause as advocated in its reports that "the greatest care
provided by law, . . . the President would be should be taken in the selection of the officials for
seriously crippled in the discharge of the grave administration. They should be men of the highest
duty and responsibility laid upon him by the character and fitness, and partisan politics should
Constitution to take care that the laws faithfully be entirely separated from the government." The
executed." fifth act passed by the Philippine Commission
created a Board of Civil Service. It instituted a
Questions of expediency are, of course, beyond
system here that was far more radical and
the province of the court to take into account in
thorough than that in the United States. The
the interpretation of laws or of the Constitution
Governor-General after William Taft adopted the
where the language is otherwise clear. But the
policy of appointing Filipinos in the government
argument is, we think, unsound even if the case
regardless of their party affiliation. As the result of
be approached from this angle. It contains its own
these the personnel of the Civil Service had
refutation. The Constitution and the law
gradually come to be one of which the people of
implementing it afford adequate safeguards
the United States could feel justly proud.
against such consequences as have been painted.
Necessity for Constitutional provision. — The
The argument proceeds, contrary to its context,
inclusion in the constitution of provisions
on the assumption that removes of civil service
regarding the "merit system" is a necessity of
officers and employees are absolutely prohibited,
modern times. As its establishment secures good
which is not the case. The Constitution authorizes
government the citizens have a right to accept its
removals and only requires that they be for cause.
guarantee as a permanent institution.
And the occasions for removal would be greatly
diminished if the injunction of section 1 of Article Separation, suspension, demotions and transfers.
XII of the Constitution — that appointments in the — The "merit system" will be ineffective if no
civil service shall be made only according to merit safeguards are placed around the separation and
and fitness, to be determined as far as practicable removal of public employees. The Committee's
by competitive examination — would be adhered report requires that removals shall be made only
of meticulously in the first place. for "causes and in the manner provided by law.
This means that there should be bona fide
By far greater mischiefs would be fomented by an
reasons and action maybe taken only after the
unbridled authority to remove. Such license would
employee shall have been given a fair hearing.
thwart the very aims of the Constitution which are
This affords the public employees reasonable
expounded by Dean Aruego, himself a member of
security of tenure. (II Aruego's Framing of the
the Constitutional Convention, in the following
Constitution, 886, 887, 890.)
remarks copied with approval in Lacson vs.
Romero, supra: As has been seen, three specified classes of
positions — policy-determining, primarily
confidential and highly technical — are excluded
from the merit system and dismissal at pleasure remove officers at pleasure has been repealed by
of officers and employees appointed therein is the Constitution and ceased to be operative from
allowed by the Constitution. These positions the time that instrument went into effect.
involved the highest degree of confidence, or are Unconstitutionally, as we understand it, denotes
closely bound out with and dependent on other life and vigor, and unconstitutional legislation
positions to which they are subordinate, or are presupposes posteriority in point of time to the
temporary in nature. It may truly be said that the Constitution. It is a statute that "attempts to
good of the service itself demands that validate and legalize a course of conduct the
appointments coming under this category effect of which the Constitution specifically forbids
determinable at the will of the officer that makes (State ex-rel. Mack vs. Guckenberger, 139 Ohio
them. St., 273; 39 NE. [2d], 840.) A law that has been
repealed is as good as if it had never been
The office of city engineer is neither primarily
enacted, and can not, in the nature of things,
confidential, policy-determining, nor highly
contravene or pretend to contravene
technical.
constitutional inhibition. So, unlike legislation that
Every appointment implies confidence, but much is passed in defiance of the Constitution, assertive
more than ordinary confidence is reposed in the and menacing, the questioned part of section
occupant of a position that is primarily 2545 of the Revised Administrative Code does not
confidential. The latter phrase denotes not only need a positive declaration of nullity by the court
confidence in the aptitude of the appointee for the to put it out of the way. To all intents and
duties of the office but primarily close intimacy purposes, it is non-existent, outlawed and
which insures freedom of intercourse without eliminated from the statute book by the
embarrassment or freedom from misgivings of Constitution itself by express mandate before this
betrayals of personal trust or confidential matters petitioner was appointed.
of state. Nor is the position of city engineer policy-
Incidentally, the last discussion answers and
determining. A city engineer does not formulate a
disposes of the proposition that in accepting
method of action for the government or any its
appointment under section 2545 of the Revised
subdivisions. His job is to execute policy, not to
Administrative Code, the petitioner must be
make it. With specific reference to the City
deemed to have accepted the conditions and
Engineer of Baguio, his powers and duties are
limitations attached to the appointment. If the
carefully laid down for him be section 2557 of the
clause of section 2545 which authorized the
Revised Administrative Code and are essentially
President to remove officers of the City of Baguio
ministerial in character. Finally, the position of
at pleasure had been abrogated when petitioner's
city engineer is technical but not highly so. A city
appointment was issued, the appointee can not
engineer is not required nor is he supposed to
presumed to have abided by this condition.
possess a technical skill or training in the
supreme or superior degree, which is the sense in We therefore hold that the petitioner is entitled to
which "highly technical" is, we believe, employed remain in office as City Engineer of Baguio with all
in the Constitution. There are hundreds of the emoluments, rights and privileges
technical men in the classified civil service whose appurtenant thereto, until he resigns or is
technical competence is not lower than that of a removed for cause, and that respondent Mallare's
city engineer. As a matter of fact, the duties of a appointment is ineffective in so far as it may
city engineer are eminently administrative in adversely affect those emoluments, rights and
character and could very well be discharged by privileges. Without costs.
non-technical men possessing executive ability. Moran, C.J., Ozaeta, Paras, Pablo, and
Section 10 of Article VIII of the Constitution Montemayor, JJ., concur.
requires that "All cases involving the
constitutionality of a treaty or law shall be heard
and decided by the Supreme Court in banc," and Separate Opinions
warns that "no treaty or law may be declared BENGZON, J., concurring:
unconstitutional without the concurrence of two-
thirds of all the members of the Court." The I concur in the result solely upon the ground that
question arises as to whether this judgment section 2545 of the Baguio Charter
operates as invalidation of section 2545 of the (Administrative Code) empowering the President
Revised Administrative Code or a part of it so as to remove the City Engineer at pleasure has been
to need at least eight votes to make effective. The impliedly repealed by section 22 of
answer should be in negative. Commonwealth Act No. 177 which expressly
provides for the first time (following the mandate
We are not declaring any part of section 2545 of of the Constitution),that "no officer or employee in
the Revised Administrative Code unconstitutional. the civil service shall be removed or suspended
What we declare is that the particular provision except for cause as provided by law."
thereof which gave the Chief Executive power to
I must decline to go into the matter of alleged days, covering the period 1 November 1986 to 30
conflict with the Constitution, first, because April 1987. Petitioner sought to take advantage of
plaintiff is precluded from raising that question a Civil Service circular which allows employees
(Zandueta vs. De la Costa, 66 Phil., 615); second, who propose to seek interim employment abroad,
because every law is presumed to be to go on prolonged leave of absence without pay
constitutional unless eight Justices of this Court without being considered separated from the
are clearly of a contrary opinion,1 and third, service. 4 The application was approved by his
because that subject need not be inquired into, immediate supervisor and Chief, Intelligence and
except when absolutely necessary for the Investigation Service, Col. Ruperto Amistoso
disposition of the controversy. (Ret.), and the personnel officer, Col. Domingo
Rodriguez (Ret.), both based in the Region 5 office
of the FMIB.
REYES, J.:
On 23 October 1986, when petitioner was already
I concur in this opinion of Mr. Justice Bengzon. in Manila attending to the processing of his travel
papers, a Memorandum was sent to him in
Legaspi City from the FMIB Central Office in
Footnotes Quezon City by respondent Assistant FMIB
1
Cf. People vs. Vera, 65 Phil., 56, 137 Commissioner Brig. Gen. Miguel Villamor (Ret.),
referring to the confidential report sent out to the
Republic of the Philippines Office of the President. The Memorandum in part
SUPREME COURT stated:
Manila
Be reminded that as an agent of FMIB, it is
EN BANC inherent in your duties to report to the
G.R. No. 85670 July 31, 1991 Commissioner or other authorities of FMIB of any
irregularity committed by employees/officials in
ROGELIO A. TRIA petitioner,
that Region [5] to enable them to take
vs.
appropriate action/investigation and/or
CHAIRMAN PATRICIA A. STO. TOMAS, CIVIL
disciplinary action.
SERVICE COMMISSION, RET. BRIG. GEN. JOSE
T. ALMONTE, RET. COL. ERNESTO P. RAVINA However, it appears that you opted to submit said
and RET. GEN. MIGUEL M. VILLAMOR, report directly to the Office of the President,
respondents. Malacañang which adversely affected the
Bureau's image and placed the Commissioner in
Florosco P. Fronda for petitioner.
an embarrasing position.
In view thereof, you are required to submit your
FELICIANO, J.:p explanation in writing within five (5) working days
Petitioner Rogelio A. Tria had been employed with from receipt hereof why no disciplinary action
the Bureau of Intelligence and Investigation later should be taken against you for non-compliance
renamed Finance Ministry Intelligence Bureau with office rules and regulations. 5
(FMIB) now known as the Economic Intelligence Since petitioner had failed to receive and hence to
and Investigation Bureau (EIIB) of the Department respond to the above Memorandum, another
of Finance, Region 5, Legaspi City, as a Memorandum from Quezon City dated 17
Management and Audit Analyst I, a position November 1986 was issued, this time by
expressly described in the letter of appointment respondent Col. Ernesto Rabina (Ret.), Chief,
as "confidential." 1 The appointment was signed Administrative Service, FMIB, reminding petitioner
by Pelagio A. Cruz, Lieutenant General, AFP (Ret) of his duty to submit the required written
Commissioner, FMIBI." 2 explanation. That Memorandum went on to state:
On 27 September 1984, petitioner wrote a Be informed further that your application for sick
confidential report to the FMIB Deputy [should have been vacation] leave dated October
Commissioner detailing the nonfeasance of a FMIB 22, 1986 . . . has been disapproved pursuant to
lawyer assigned to Region 5. Petitioner's report Sec. 16 of Civil Service Rule No. XVI which reads
recommended the lawyer's replacement "With a thus: "Leave of absence for any reason other than
competent and able lawyer to handle the cases serious illness must be contingent upon the needs
brought to his attention." 3 On 14 October 1986, of the service."
petitioner submitted another confidential report,
Inasmuch as your services in that Region [5] is
addressed to the Deputy Executive Secretary,
(sic) needed, you are directed to report for work
Office of the President, this time concerning Col.
thereat within ten (10) working days from the
Jackson P. Alparce (Ret.). FMIB Region 5 Director.
date of this Memorandum otherwise, this office
On 20 October 1986, petitioner filed an will be constrained to drop you from the rolls of
application for vacation leave for 100 working FMIB for prolonged/unauthorized absence and
non-compliance with office rules and regulations. rules and regulations were the grounds for your
6
termination for loss of confidence. 9
Petitioner, however, had already left the country Petitioner's request for payment of the cash
on 26 October 1986, and was unable to comply equivalent of his accrued leave credits
with the express directives of the second corresponding to a total of 179 days was also
Memorandum. He was therefore considered to be denied by respondent Villamor on the ground
on absence without official leave (AWOL). This that:
prolonged absence, as well as his failure to . . . Section 6 of the Civil Service rules and laws
explain his sending out the confidential report to provides that IX . . . the removal for cause of an
Malacañang, prompted respondent EIIB official or employee shall carry with it forfeiture of
Commissioner Brig Gen. Jose Almonte (Ret.) to . . . other benefits arising from his employment. 10
issue Letter-Order No. 06-87 dated 12 January
1987 informing petitioner of the termination of his Petitioner then filed a petition for review with
services retroactive to "1 November 1986 for prayer for reinstatement and backwages before
continuous absence without official leave and for respondent Civil Service Commission
loss of confidence." 7 ("Commission") which the Commission denied.
Respondent Commission held that the grant of
It was upon his return to the country sometime in petitioner's application for vacation leave,
May 1987 that petitioner came to know of the notwithstanding the accumulation of sufficient
abovementioned Letter-Order and of the two leave credits, was discretionary on the part of
Memoranda. In a letter dated 20 May 1987 to respondent Rabina, the approving official, citing
respondent Almonte, petitioner asked for In re: Nicolasura Victor (CSC Res. No. 88-251)
reinstatement, stating that his application for dated 25 May 1988 and Section 20 of the Revised
vacation leave had been approved by his Civil Service Rules which read:
immediate chief and the personnel officer. With
respect to the confidential report he had Leave of absence for any reason other than the
addressed to the Deputy Executive Secretary, serious illness of an officer or employee . . . must
petitioner explained: be contingent upon the needs of the service. 11
. . . I would like to state that the reason why I Having failed to get reconsideration, petitioner
submitted my report to the Office of the President came to this Court on the present Petition for
is precisely to protect the image of the bureau. Certiorari.
Earlier, I handed a report to the then Deputy Petitioner challenges his dismissal as being
Commissioner Mendoza regarding said arbitrary. The propriety of petitioner's alleged
irregularities committed sometime in 1984-85, unlawful removal boils down to the question of
particularly by Atty. Geronga, R-5 and Director whether or not an employee holding a position
Col. Alfarce No investigation was undertaken considered as "primarily confidential" may be
inspite of my report. In the meanwhile, the FMIB- dismissed on grounds of "loss of confidence" by
R-5 always appeared in the local newspaper the appointing authority on the basis of the
regarding the unscrupulous behavior of the employee's having gone on unauthorized leave of
director which not only affects the good image of absence and of his having filed a confidential
our organization but also of the subordinates of report on one of his superiors directly with the
the office. Thus, I felt in goodfaith that the matter Office of the President.
should be brought to the attention of the Deputy
Executive Secretary of Malacañang so that We begin with the proposition that the effects of
appropriate action can be taken for the good of characterizing a position as "primarily
the service. I submit that I did this in my honest confidential" are two-fold: firstly, such
belief that it is my duty to do so as a public characterization renders inapplicable the ordinary
servant and a loyal member of this organization. requirement of filling up a position in the Civil
Service on the basis of merit and fitness as
. . . I reiterate that the same was done in good determined by competitive examinations; and
faith and not for any selfish motive. 8 secondly, while the 1987 Constitution does not
Reinstatement was, however, denied by exempt such positions from the operation of the
respondent Rabina in a letter dated 11 August principle set out in Article IX (B), Section 2 (3) of
1987, which in part read: the same Constitution that "no officer or
employee of the Civil Service shall be removed or
xxx xxx xxx suspended except for cause provided by law," the
Be informed that Commissioner, EIIB has directed "cause provided by law" includes "loss of
the Investigation & Prosecution Office this bureau confidence." 12 It is said to be a settled rule that
to conduct a brief investigation on your case and those holding primarily confidential positions
the established facts show that this office "continue for so long as confidence in them
committed no injustice. Your violation of office endures. Their termination can be justified on the
ground of loss of confidence because in that case
their cessation from office involves no removal installation of management control devices;
but the expiration of their term of office. 13 assists in the compilation, analysis and
Notwithstanding the refined distinction between interpretation of important statistics for use of
removal from office and expiration of the term of management. 16 (Emphasis Supplied)
a public officer, the net result is loss of tenure It is thus useful to recall that in Piñero v.
upon loss of confidence on the part of the Hechanova, 17 the Court, speaking through J.B.L.
appointing power. Reyes, J., said:
A position in the Civil Service may be considered It is plain that, at least since the enactment of the
primarily confidential: (1) when the President of 1959 Civil Service Act (R.A. 2260), it is the nature
the Philippines, upon recommendation of the Civil of the position which finally determines whether a
Service Commission, has declared that position to position is primarily confidential, policy
be primarily confidential; or (2) when the position, determining or highly technical. Executive
given the character of the duties and functions pronouncements can be no more than initial
attached to it, is primarily confidential in nature.
14 determinations that are not conclusive in case of
All positions in the EIIB were apparently conflict. And it must be so, or else it would then
declared as "highly confidential" by former lie within the discretion of the Chief Executive to
President Marcos in Letter of Implementation No. deny to any officer, by executive fiat the
71, dated 4 September 1978, which reads in part protection of section 4, Article XII, of the
as follows: Constitution. 18 (Citation omitted; emphasis partly
Pursuant to Presidential Decree No. 1458, dated in the original and partly supplied)
June 11, 1978, and letter dated August 18, 1978 The above doctrine was reiterated and relied
of the President/Prime Minister creating the upon in Borres v. Court of Appeals. 19 It is also
Bureau of Intelligence and Investigation (BII) [now important to note that the concept constitutive of
the EIIB], the following directives are hereby "primarily confidential" positions has been
issued for immediate implementation by the new narrowly drawn by this Court. Thus, in De los
Bureau: Santos v. Mallare, 20 the Court said, through Mr.
xxx xxx xxx Justice Pedro Tuason:
4. The Commissioner of the BII with the approval . . . [T]hree specified classes of positions — policy
of the Ministry of Finance, is hereby instructed to determining, primarily confidential and highly
organize and appoint his staff . . . All positions in technical — are excluded from the merit system
the BII are highly confidential in nature and and dismissal at pleasure of officers and
incumbents thereof may be removed for loss of employees appointed therein is allowed by the
confidence by appropriate authority. 15 Constitution. These positions involve the highest
degree of confidence, or are closely bound up
When one examines, however, the actual duties
with and dependent on other positions to which
and functions of petitioner as a "Management and
they are subordinate, or are temporary in nature.
Audit Analyst I" in the FMIB, as set out in the job
It may truly be said that the good of the service
description of that position, one is struck by the
itself demands that appointments coming under
ordinary and day to day character of such duties
this category be terminable at the will of the
and functions:
officer that makes them.
Prepares required survey materials, work plans
xxx xxx xxx
and schedules; gathers data and makes
investigations and analyzes (sic) of administrative Every appointment implies confidence, but much
problems relating to organization, personnel and more than ordinary confidence is reposed in the
procedure; supplements data gathered by occupant of a position that is primarily
interviewing heads of office or private individuals confidential. The latter phrase denotes not only
or by observing actual operations; examines and confidence in the aptitude of the appointee for
analyzes reorganization proposals in the light the duties of the office but primarily close
gathered and facts observed; analyzes causes of intimacy which insures freedom of [discussion
inefficiency or lack of economy, undertakes and delegation and reporting] without
required study and research; prepares survey embarrassment or freedom from misgivings of
reports and write (sic) drafts of tentative betrayals of personal trust or confidential matters
organization plans, discusses and justifies such of state. . . . . 21
plans to supervisor and appropriate bodies; The positions which this Court has in the past
maintains close liaison work with head of offices characterized as "primarily confidential" include:
or organizations studies operational methods and private secretaries of public functionaries; 22 a
procedures of the organization to simplify the security officer assigned as bodyguard of the
work and improve efficiency; studies and person of a public officer and responsible for
recommends measures to insure industrial safety taking security measures for the safety of such
and prevention of accidents; supervises the official, 23 City Legal Officer of Davao City vis-a-vis
the Davao City Mayor; 24 Provincial Attorney of of the matter. The Court considers that, under the
Iloilo Province vis-a-vis the Governor of Iloilo circumstances of this case the subsequent
Province. 25 It is also instructive to refer to some investigation constituted substantial compliance
of the positions which the Court has refused to with the demands of procedural due process.
designate as "primarily confidential:" e.g., Substantive due process requires, among other
members of the Customs Police Force or Port things, that an officer or employee of the Civil
Patrol; 26 Special Assistant to the Governor of the Service be suspended or dismissed only "for
Central Bank, in charge of the Export Department;
27 cause," a phrase which, so far as concerns
Senior Executive Assistant, Clerk I and dismissals of public officers not holding positions
Supervising Clerk I and stenographer in the Office which are "policy determining, highly technical or
of the President. 28 primarily confidential," has acquired, according to
It is evident that the duties of petitioner related to this Court, the following "well-defined concept."
the study and analysis of organizational structures It means for reasons which the law and sound
and procedures, with the end in view of making policy recognize as sufficient warrant for removal,
recommendations designed to increase the levels that is, legal cause, and not merely causes which
of efficiency and coordination within the the appointing power in the exercise of discretion
organization so analyzed. Moreover, the modest may deem sufficient. It is implied that officers
rank and fungible nature of the position occupied may not be removed at the mere will of those
by petitioner, is underscored by the fact that the vested with the power of removal or without
salary attached to it was no more than P1,500.00 cause. Moreover, the cause must relate to and
a month at the time he went on leave (October, effect the administration of the office, and must
1986). There thus appears nothing to suggest that be restricted to something of a substantial nature
petitioner's position was "highly" or even directly affecting the rights and interests of the
"primarily confidential" in nature. The fact that public. 31
petitioner may, sometimes, handle "confidential
matters" or papers which are confidential in In the instant case, we have noted earlier that
nature, does not suffice to characterize their petitioner was charged with violation of official
positions as primarily confidential. 29 rules and regulations consisting more specifically,
of:. (1) having gone on an extended unauthorized
Accordingly, we believe and so hold that leave of absence; (2) having bypassed official
petitioner Tria's particular position of channels in transmitting a report concerning
"Management and Audit Analyst I" is not a alleged misfeasance or non-feasance on the part
"primarily confidential" position so as to render of a superior officer of the EIIB directly to the
him removable upon, or the expiration of his term Office of the President through the Deputy
of office concurrent with, "loss of confidence" on Executive Secretary, rather than through the
the part of the appointing power who, as already respondent EIIB Commissioner.
noted, was the then Commissioner of the FMIB.
It is true that petitioner was probably precipitate
If petitioner Tria was not legally removable upon in taking off for abroad before his application for
"loss of confidence" on the part of the FMIB vacation leave was formally approved by the FMIB
Commissioner, was there nonetheless legal cause Central Office in Quezon City. We must, however,
provided by law for his dismissal from the service? take into account the circumstance that his
We believe that the constitutional prohibition application for leave without pay had been
against suspension or dismissal of an officer or approved or indorsed for approval by his
employee of the Civil Service "except for cause immediate superior in the FMIB, Region 5 Office,
provided by law" is a guaranty of both procedural where petitioner was assigned, and so petitioner
and substantive due process. Procedural due was not completely without basis in believing that
process requires that suspension or dismissal the formal approval of his application in the FMIB
come, as a general rule, only after notice and Central Office would follow as a matter of course.
hearing. 30 In the case at bar, as already noted, It is pertinent to point out that his immediate
the EIIB issued a Memorandum to petitioner, after superiors in the Region 5, FMIB Office were the
he was already in Manila, requiring him to explain persons in the best position to ascertain whether
why no disciplinary action should be taken against his presence in the Regional office during the
him for having submitted a report directly to the period covered by his application for leave
Office of the President, Malacañang, 'which without pay was really demanded by imperious
adversely affected the bureau's image and placed exigencies of the service. The record is bare of
the Commissioner in an embarrassing position," any indication what those exigencies were, at that
which Memorandum was not received by particular time. There is also no showing that the
petitioner. However, after his return from abroad FMIB actually suffered any prejudice by reason of
and upon request of petitioner, another the non-availability of the services of petitioner
investigation was conducted by the EIIB where during his leave without pay. Petitioner was, it
petitioner had an opportunity to explain his side should be recalled, a "Management and Audit
Analyst," a humble rank separated by many ranks According to the testimony of Director Manuel T.
from the appointing power, the FMIB Leelin the act of Board Secretary Gray in sending
Commissioner. It thus appears to the Court that, the telegram of January 12,1959 to the President
on balance, the extreme penalty of dismissal from of the Philippines was an act of treachery or
the service was unduly harsh in the case of disloyalty to the Board. . . .
petitioner; that suspension for thirty (30) days xxx xxx xxx
would have been more than adequate punishment
for precipitately going on leave without pay prior We cannot agree, for the following reasons:
to formal approval of his leave by the Central First. As pointed out, the sending of the telegram
Office of the FMIB; and that the real and efficient to the President of the Philippines was an act of
cause of his dismissal from the service was the civic duty. The telegram was a privileged
fact that he had bypassed official channels in communication presumably sent in good faith and
rendering the confidential report addressed to the capable of being proved by evidence.
Deputy Executive Secretary, Office of the
President, concerning the then Regional Director Second. The position of secretary to the board of
of FMIB, Region 5. a government corporation was declared by the
President in Executive Order No. 399 primarily
After careful consideration, we believe and so confidential in nature with the obvious intent that
hold that, in the circumstances of this case, that the position be filled by an appointee of
act of petitioner did not constitute lawful cause for unquestioned honesty and integrity. Hence, the
his dismissal from the service. We believe, on the act of Board Secretary Gray in reporting to the
contrary, that petitioner's case is covered by the President the Board's act of mismanagement and
rule in Gray v. De Vera. 32 Benjamin A. Gray was misconduct was in consonance with the honesty
Secretary of the Board of Directors of the People's and integrity required for the position.
Homesite and Housing Corporation ("PHHC"). He
sent a telegram to President Carlos P. Garcia Assuming that Gray owed loyalty to the Board,
reading as follows: that loyalty was in the interest of good
government and not in the personal interest of
Aye suggest complete revamp PHHC Board's top the Directors to the extent of concealing the
members should not usurp management shenanigans of the Board. . . . 34
functions (comma) should willingly attend
meetings (comma) should not grab as quotas In the case at bar, we note that petitioner sent his
dwelling awards despite applicants of long confidential (and presumably sealed) report to an
standing (comma) should not divide among office having overall administrative supervision
themselves emergency positions (comma) should and control over the FMIB (i.e., the Office of the
create positions only in case of necessity and not President); the report was not, in other words,
because they want to accommodate their useless sent either to the media or to an office or agency
men (comma) and should respect civil service having no administrative jurisdiction over the
law. 33 public official or office complained of. That report
was a privileged communication and the author
On the following day, the PHHC Board of Directors thereof enjoys the benefit of the presumption that
terminated Gray's services "on account of loss of he acted in good faith. The respondents have not
confidence due to treachery or disloyalty to the alleged that petitioner acted with malice in fact.
Board." In holding that Gray had been unlawfully We do not believe that petitioner's act constituted
dismissed and in ordering his reinstatement with serious misconduct but rather, on the contrary,
backwages, this Court held: was an act of personal and civic courage by which
The removal of Board Secretary Gray from the petitioner exhibited his loyalty to the FMIB as an
primarily confidential position to which he had institution and ultimately to the Government of
been permanently appointed was illegal in view of the Republic of the Philippines.
the following considerations: Considerations of fundamental public policy thus
(1) There was no lawful cause for removal. The compel us to hold that petitioner was dismissed
sending of the telegram of January 12, 1959 to without lawful cause and must, therefore, be
President Carlos P. Garcia suggesting a complete reinstated to the position he previously held or, If
revamp of the Board of Directors of the PHHC due that position is no longer available, to some other
to the Board's acts of management and position in the EIIB of equivalent rank and
misconduct, the most serious of which was that emoluments. In addition, petitioner is entitled to
the Directors were grabbing as 'quotas dwelling payment of his backwages (basic salary plus
awards despite applicants of long standing,' was allowances, if any computed from the time of his
an act of civic duty. The telegram was a return from his leave of absence, minus an
privileged communication presumably made in amount equivalent to one-month's backwages
good faith and capable of being substantiated by representing the appropriate penalty for
evidence. petitioner's infraction of ordinary office rules.
WHEREFORE, the Petition for Certiorari is hereby "Upon recommendation of the Commissioner, the
GRANTED DUE COURSE, the Comments filed by President may declare a position as policy-
respondents are hereby CONSIDERED as their determining, primarily confidential or highly
Answers to the Petition and Resolutions Nos. 88- technical in nature. . . ." (58 Official Gazette No.
150 and 88-787 of public respondent Civil Service 49, Supplement, 3 November 1962)
Commission as well as Letter-Order No. 06-87 of 15 Rollo, p. 72.
public respondent EIIB Commissioner, are hereby
ANNULLED and SET ASIDE. Public respondents are 16 Annex "4" of Comment, Rollo, p. 88.
hereby ORDERED to reinstate forthwith petitioner 17 18 SCRA 417 (1966).
to his former position, or to a position of
equivalent rank and compensation, and to pay 18 18 SCRA at 423.
him the backwages, allowances and other 19 153 SCRA 120 (1987).
benefits lawfully due him counted from May 1987,
20 87 Phil. 289 (1950).
when he returned to the country from his leave of
absence, until actual reinstatement, less one 21 87 Phil. 297-298; emphasis and brackets
month's backwages. No costs. supplied.
SO ORDERED. 22 See Corpus v. Cuaderno, 13 SCRA at 596.
Fernan, C.J., Narvasa, Melencio-Herrera, 23 Borres v. Court of Appeals, supra.
Gutierrez, Jr., Cruz, Paras, Gancayco, Padilla,
24 Cadiente v. Santos, 142 SCRA 280 (1986).
Bidin, Sarmiento, Griño-Aquino, Medialdea,
Regalado and Davide, Jr., JJ., concur. 25 Griño v. Civil Service Commission, supra.
26 Piñero v. Hechanova, supra.
Footnotes 27 Corpuz v. Cuaderno, supra.
1 Annex "1", Comment of Respondents, Rollo, p. 28 Ingles v. Mutuc, 26 SCRA 171 (1968).
81. 29 In Ingles v. Mutue (supra), Concepcion, C.J.,
2 Id. said:
3 Annex 'D" of Petition, Rollo, p. 26. Indeed, physicians handle confidential matters.
Judges, fiscals and court stenographers generally
4 Resolution No. 85-444 of the Civil Service handle matters of similar nature. The Presiding
Commission entitled "Policy on Leave of Absence
and Associate Justices of the Court of Appeals
to Work Abroad." sometimes investigate, by designation of the
5 Annex "F" of Petition, Rollo, p. 31; emphasis Supreme Court, administrative complaints against
supplied. judges of first instance, which are confidential in
6 Annex "G" of Petition, Rollo, p. 32; emphasis nature. Officers of the Department of Justice,
likewise, investigate charges against municipal
supplied.
judges. Assistant Solicitors in the Office of the
7 Annex "2" of Comment; Rollo, p. 82. Solicitor General often investigate malpractice
8 Annex "H" of Petition, Rollo, p. 34; emphasis charges against members of the Bar. All of these
supplied. are "confidential" matters, but such fact does not
warrant the conclusion that the office position of
9 Annex "I" of Petition, Rollo, p. 35; emphasis all government physicians and all Judges, as well
supplied. as the aforementioned assistant solicitors and
10 Annex "K" of Petition, Rollo, p. 37. officers of the Department of Justice are primarily
confidential in character. (26 SCRA at 177-178;
11 Annex "A" of Petition, Rollo, p. 21. emphasis supplied)
12 E.g., Corpuz v. Cuaderno, 87 Phil. 289; 13 30 Reyes v. Subido, 66 SCRA 203 (1975). Section
SCRA 591 (1965); Hernandez v. Villegas, 14 SCRA 36 (a) of the Civil Service Decree provides:
544 (1965); Cariño v. Agricultural Credit and
Cooperative Financing Administration, 18 SCRA "No officer or employee in the Civil Service shall
183 (1966); Ingles v. Mutuc, 26 SCRA 171 (1968). be suspended or dismissed except for cause as
provided by law and after due process."
13 Hernandez v. Villegas supra; Griño v. Civil
Service Commission, G.R. No. 91602, dated 26 31 De los Santos v. Mallare, 87 Phil. at 293.
February 1991. 32 28 SCRA 268 (1969).
14 Salazar v. Mathay, 73 SCRA 269 (1976). 33 28 SCRA at 270.
Section 2 of Rule 20, Revised Civil Service Rules,
promulgated pursuant to the provisions of Section 34 28 SCRA at 272-275; emphasis supplied.
16 (e) of Republic Act No. 2260 (the Civil Service
Act of 1959) provided that:
Republic of the Philippines Governor authorized said appointee to receive
SUPREME COURT representation allowance, he violated the Anti-
Manila Graft and Corrupt Practices Act. He then asks that
the matter be investigated.
THIRD DIVISION
In his letter to the Chairman of the Civil Service
G.R. No. 71562 October 28, 1991
Commission dated 18 January 1983, 5 Jose A.
JOSE P. LAUREL V, in his official capacity as Oliveros, Acting Provincial Attorney of Batangas,
Provincial Governor of Batangas, petitioner, for and in behalf of herein petitioner, asserts that
vs. the latter did not violate the provision prohibiting
CIVIL SERVICE COMMISSION and LORENZO nepotism under Section 49 of P.D. No. 807
SANGALANG, respondents. because, with respect to the positions of Senior
Provincial Attorney for respondent. Executive Assistant and Civil Security Officer, both
are primarily confidential in nature; and, with
RESOLUTION respect to the position of Provincial Administrator:
. . . what is prohibited under Section 49 of P.D.
DAVIDE, JR., J.:p 807 is the appointment of a relative to a career
Civil Service position, like that of a provincial
Is the position of Provincial Administrator administrator. Governor Laurel did not appoint his
primarily confidential? brother, Benjamin, as Provincial Administrator. He
Does the rule on nepotism apply to designation? merely designated him "Acting Provincial
Administrator." And "appointment" and
May a private citizen who does not claim any
"designation" are two entirely different things.
better right to a position file a verified complaint
Appointment implies original establishment of
with the Civil Service Commission to denounce a
official relation. Designation is the imposition of
violation by an appointing authority of the Civil
new or additional duties upon an officer to be
Service Law and rules?
performed by him in a special manner. It
These are the issues raised in this petition. presupposes a previous appointment of the officer
The antecedent facts are not disputed. in whom the new or additional duties are
imposed.
Petitioner, the duly elected Governor of the
Province of Batangas, upon assuming office on 3 Appointment is generally permanent, hence the
March 1980, appointed his brother, Benjamin officer appointed cannot be removed except for
Laurel, as Senior Executive Assistant in the Office cause; designation is merely temporary and the
of the Governor, a non-career service position new or additional powers may be withdrawn with
which belongs to the personal and confidential or without cause.
staff of an elective official. 1 Benjamin C. Laurel had already been appointed
On 31 December 1980, the position of Provincial Senior Executive Assistant in the Office of the
Administrator of Batangas became vacant due to Governor when Governor Laurel designated him
the resignation of Mr. Felimon C. Salcedo III. Acting Provincial Administrator.
Allegedly for lack of qualified applicants and so as It is further alleged that there was no violation of
not to prejudice the operation of the Provincial the Anti-Graft and Corrupt Practices Act because:
Government, petitioner designated his brother,
As Acting Provincial Administrator, Benjamin is
Benjamin Laurel, as Acting Provincial
entitled under Office of the President
Administrator effective 2 January 1981 and to
Memorandum-Circular No. 437, series of 1971, to
continue until the appointment of a regular
a monthly representation allowance of P350.00.
Provincial Administrator, unless the designation is
And said allowance is "strictly on reimbursement
earlier revoked. 2
basis." 6
On 28 April 1981, he issued Benjamin Laurel a
On 12 July 1983, the Civil Service Commission
promotional appointment as Civil Security Officer,
handed down the aforesaid Resolution No. 83-358
a position which the Civil Service Commission
7 which, inter alia, revokes the designation of
classifies as "primarily confidential" pursuant to
Benjamin as Acting Provincial Administrator on
P.D. No. 868. 3
the ground that it is "nepotic", or in violation of
On 10 January 1983, private respondent Section 49, P.D. No. 807 on nepotism. The
Sangalang wrote a letter to the Civil Service relevant portion of said section reads as follows:
Commission 4 to bring to its attention the
SECTION 49. Nepotism. — (a) All appointments in
"appointment" of Benjamin Laurel as Provincial
the national, provincial, city and municipal
Administrator of Batangas by the Governor, his
governments or in any branch or instrumentality
brother. He alleges therein that: (1) the position in
thereof, including government-owned or
question is a career position, (2) the appointment
controlled corporations, made in favor of a
violates civil service rules, and (3) since the
relative of the appointing or recommending arrogated unto itself the power to review a
authority, or of the chief of the bureau or office, or designation made by petitioner by virtue of the
of the persons exercising immediate supervision powers in him vested under Section 2077 of the
over him, are hereby prohibited. Revised Administrative Code.
As used in this Section, the word "relative" and C. Respondent Commission exceeded its
members of the family referred to are those jurisdiction when it gave due course to the
related within the third degree either of complaint of private respondent and thereafter
consanguinity or affinity. promulgated the resolutions under question in
this petition.
(b) The following are exempted from the
operation of the rules on nepotism: (1) persons D. There is no appeal, nor any other plain, speedy
employed in a confidential capacity, (2) teachers, and adequate remedy in the ordinary course of
(3) physicians, and (4) members of the Armed law available to petitioner to have the questioned
Forces of the Philippines: Provided, however, That resolutions of respondent Commission reviewed
in each particular instance full report of such and thereafter nullified, revoked and set aside,
appointment shall be made to the Commission. other than this recourse to a petition for certiorari
under Rule 65 of the Rules of Court.
xxx xxx xxx
In the Comment filed for the respondent
Although what was extended to Benjamin was
Commission on 7 October 1985, the Solicitor
merely a designation and not an appointment, the
General sustains the challenged resolutions and
Civil Service Commission ruled that "the
contends that the position of Provincial
prohibitive mantle on nepotism would include
Administrator is intended to be part of the career
designation, because what cannot be done
system and since it requires a specific civil service
directly cannot be done indirectly." It further held
eligibility, it belongs to the career service under
that Section 24(f) of Republic Act No. 2260
Section 5(1) of P.D. No. 807 and has not been
provides that no person appointed to a position in
declared primarily confidential by the President
the non-competitive service (now non-career)
pursuant to Section 1 of P.D. No. 868; that the
shall perform the duties properly belonging to any
Commission has the authority to review,
position in the competitive service (now career
disapprove, and set aside even mere
service). The petitioner, therefore, could not
designations, as distinguished from appointments,
legally and validly designate Benjamin, who
for Section 2 of P.D. No. 807 vests in it the power
successively occupied the non-career positions of
to enforce the laws and rules governing the
Senior Executive Assistant and Civil Security
selection, utilization, training and discipline of civil
Officer, to the position of Provincial Administrator,
servants; and that it can act on Sangalang's
a career position under Section 4 of R.A. No.
complaint pursuant to Section 37 of P.D. No. 807,
5185.
for what he filed was not an action for quo
Petitioner's motion to reconsider said Resolution, warranto, but an administrative complaint to
8 based on the claim that the questioned position correct a violation of the Civil Service law and
is primarily confidential in nature, having been rules which involved public service and the public
denied in Resolution No. 85-271 of 3 July 1985 9 interest. Per Benitez vs. Paredes, 10 reiterated in
wherein the respondent Civil Service Commission Tañada vs.
maintains that said position is not primarily- Tuvera, 11 where the question is one of public
confidential in nature since it neither belongs to right, the people are regarded as the real parties
the personal staff of the Governor nor are the in interest, and the relator at whose instigation
duties thereof confidential in nature considering the proceedings are instituted need only show
that its principal functions involve general that he is a citizen and as such interested in the
planning, directive and control of administrative execution of the laws.
and personnel service in the Provincial Office,
On 11 December 1985, petitioner filed his Reply
petitioner filed the instant petition invoking the
to the Comment insisting therein that the duties,
following grounds:
functions and responsibilities of the Provincial
A. Respondent Commission has committed a (sic) Administrator render said position primarily
grave abuse of discretion amounting to lack or confidential in nature; the requirement of a
excess of jurisdiction when it held that the specific service eligibility and absence of a
position of provincial administrator is not a presidential declaration that the position is
primarily-confidential position because said ruling primarily confidential do not place the said
is diametrically opposed to, and in utter disregard position in the career service; the position of
of rulings of this Honorable Court as to what is a Provincial Administrator is in the non-career
primarily-confidential position under Article XII-B, service; and that the Benitez vs. Paredes and
Sec. 2 of the Constitution. Tañada vs. Tuvera cases are not applicable in this
B. Respondent Commission gravely abused its case. Petitioner insists that the controlling
discretion and acted without jurisdiction when it doctrines are those enunciated in Salazar vs.
Mathay, 12 where this Court held that there are On the contrary, he submits, or otherwise admits
two instances when a position may be considered therein, that said position is not primarily
primarily confidential, to wit: (a) when the confidential for it belongs to the career service.
President, upon recommendation of the He even emphasized this fact with an air of
Commissioner of Civil Service (now Civil Service absolute certainty, thus:
Commission) has declared a position to be At this juncture, may I emphasize that what is
primarily confidential; and (2) in the absence of prohibited under Sec. 49 of P.D. 807 is the
such declaration, when by the very nature of the appointment of a relative to a career Civil Service
functions of the office, there exists close intimacy position, LIKE THAT OF PROVINCIAL
between the appointee and the appointing power ADMINISTRATOR . . . (capitalization supplied for
which insures freedom of intercourse without emphasis).
embarrassment or freedom from misgiving or
betrayals of personal trust or confidential matters The sole ground invoked by him for exemption
of state and Piñero vs. Hechanova, 13 where this from the rule on nepotism is, as above indicated:
Court ruled that at least, since the enactment of the rule does not apply to designation — only to
the 1959 Civil Service Act (R.A. No. 2260), it is the appointment. He changed his mind only after the
nature of the position that finally determines public respondent, in its Resolution No. 83-358,
whether a position is primarily confidential, policy ruled that the "prohibitive mantle on nepotism
determining, or highly technical and that would include designation, because what cannot
executive pronouncements can be no more than be done directly cannot be done indirectly" and,
initial determinations that are not conclusive in more specifically, only when he filed his motion to
case of conflict, which must be so, or else "it reconsider said resolution. Strictly speaking,
would then lie within the discretion of the Chief estoppel has bound petitioner to his prior
Executive to deny to any officer, by executive fiat, admission. Per Article 1431 of the Civil Code,
the protection of section 4, Article XII of the through estoppel an admission or representation
Constitution." is rendered conclusive upon the person making it,
and cannot be denied or disproved as against the
In his Rejoinder filed on 16 December 1986, the person relying thereon. 15
Solicitor General states that the rulings in the
Salazar and Piñero cases have been modified and But even if estoppel were not to operate against
superseded by Section 6 of P.D. No. 807, and by him, or regardless thereof, his claim that the
the third paragraph of Section 1 of P.D. No. 868, position of Provincial Administrator is primarily
which provides: confidential, is without merit.
Any provision of law authorizing any official, other As correctly maintained by the public respondent
than the President, to declare positions policy- and the Solicitor General, the position of
determining, primarily confidential or highly Provincial Administrator is embraced within the
technical which are exempt from the Civil Service Career Service under Section 5 of P.D. No. 807 as
Law and rules is hereby repealed, and only the evidenced by the qualifications prescribed for it in
President may declare a position-determining, the Manual of Position Descriptions, 16 to wit:
highly technical or primarily confidential, upon Education : Bachelor's degree preferably in
recommendation of the Civil Service Commission, Law/Public or Business Administration.
the Budget Commission and the Presidential
Reorganization Commission. Experience : Six years of progressively
responsible experience in planning, directing and
The Solicitor General further asseverates that the administration of provincial government
Commissions' giving due course to the complaint operations. Experience in private agencies
of Sangalang is manifestly valid and legal for it is considered are those that have been more or less
also in accordance with the declared policies of familiar level of administrative proficiency.
the State provided for in Section 2 of P.D. No. 807.
Eligibility : RA 1080 (BAR)/Personnel Management
In the Resolution of 9 February 1987, this Court Officer/Career Service (Professional)/First
gave due course to the petition and required the Grade/Supervisor).
parties to submit simultaneous memoranda.
It may be added that the definition of its functions
We shall take up the issues in the order they are and its distinguishing characteristics as laid down
presented above. in the Manual, thus:
1. The first issue becomes important because if xxx xxx xxx
the questioned position is primarily confidential,
Section 49 of P.D. No. 807 on nepotism would not 2. DEFINITION:
apply in the instant case. Interestingly, however, Under the direction of the Provincial Governor,
petitioner did not raise it in the letter to the responsible for the overall coordination of the
Chairman of the Civil Service Commission dated activities of the various national and local
18 January 1983. 14 agencies in the province; and general planning,
direction and control of the personnel functions for the reason that the latter may be considered
and the administrative services of the Governor's merely as the initial determination of the
Office. Executive, which in no case forecloses judicial
review. A rule that exclusively vests upon the
3. DISTINGUISHING CHARACTERISTICS:
Executive the power to declare what position may
This is the class for top professional level be considered policy-determining, primarily
management, administrative and organizational confidential, or highly technical would subvert the
work in the operation of provincial government provision on the civil service under the 1973
with highly complex, involved relationships with Constitution which was then in force at the time
considerable delegation of authority and the decree was promulgated. Specifically, Section
responsibility and a high degree of public contact. 2 of Article XII of said Constitution makes
render indisputable the above conclusion that the reference to positions which are policy-
subject position is in the career service which, per determining, primarily confidential, or highly
Section 5 of P.D. No. 807, is characterized by (a) technical in nature," thereby leaving no room for
entrance based on merit and fitness to be doubt that, indeed, it is the nature of the position
determined as far as practicable by competitive which finally determines whether it falls within the
examinations, or based on highly technical above mentioned classification. The 1987
qualifications, (b) opportunity for advancement to Constitution retains this rule when in Section 2 of
higher career positions, and (c) security of tenure. Article IX-C, it clearly makes reference to
More specifically, it is an open career position, for "positions which are policy-determining, primarily
appointment to it requires prior qualification in an confidential, or highly technical."
appropriate examination. 17 It falls within the In the light of the foregoing, We cannot accept the
second major level of positions in the career view of the Solicitor General in his Rejoinder 20
service, per Section 7 of P.D. No. 807, which that Salazar vs. Mathay 21 and Piñero, et al. vs.
reads: Hechanova, et al., 22 have already been modified
Sec. 7. Classes of Positions in the Career Service. by Section 6 of P.D. No. 807 and the third
— (a) Classes of positions in the career service paragraph of Section 1 of P.D. No. 868.
appointment to which requires examinations shall Not being primarily confidential, appointment
be grouped into three major levels as follows: thereto must, inter alia, be subject to the rule on
xxx xxx xxx nepotism.

(2) The second level shall include professional, We likewise agree with the public respondent that
technical, and scientific positions which involve there is one further obstacle to the occupation by
professional, technical, or scientific work in a non- Benjamin Laurel of the position of Provincial
supervisory or supervisory capacity requiring at Administrator. At the time he was designated as
least four years of college work up to Division Acting Provincial Administrator, he was holding
Chief level; . . . the position of Senior Executive Assistant in the
Office of the Governor, a primarily confidential
In Piñero, et al. vs. Hechanova, et al., 18 this position. He was thereafter promoted as Civil
Court had the occasion to rule that: Security Officer, also a primarily confidential
It is plain that, at least since the enactment of the position. Both positions belong to the non-career
1959 Civil Service Act (R.A. 2260), it is the nature service under Section 6 of P.D. No. 807. As
of the position which finally determines whether a correctly ruled by the public respondent,
position is primarily confidential, policy petitioner cannot legally and validly designate
determining or highly technical. Executive Benjamin Laurel as Acting Provincial
pronouncements can be no more than initial Administrator, a career position, because Section
determinations that are not conclusive in case of 24(f) of R.A. No. 2260 provides that no person
conflict. And it must be so or else it would then lie appointed to a position in the non-competitive
within the discretion of the Chief Executive to service (now non-career) shall perform the duties
deny to any officer, by executive fiat, the properly belonging to any position in the
protection of Section 4, Article XII 19 of the competitive service (now career service).
Constitution. 2. Being embraced in the career service, the
This rule stands despite the third paragraph of position of Provincial Administrator must, as
Section 1 of P.D. No. 868 which pertinently reads: mandated by Section 25 of P.D. No. 807, be filled
up by permanent or temporary appointment. The
. . . and only the President may declare a position first shall be issued to a person who meets all the
policy-determining, highly technical or primarily requirements for the position to which he is
confidential, upon recommendation of the Civil appointed, including the appropriate eligibility
Service Commission, the Budget Commission and prescribed. In the absence of appropriate eligibles
the Presidential Reorganization Commission. and it becomes necessary in the public interest to
fill a vacancy, a temporary appointment shall be
issued to a person who meets all the hence a designation of a person to fill it up
requirements for the position except the because it is vacant, is necessarily included in the
appropriate civil service eligibility, provided, term appointment, for it precisely accomplishes
however, that such temporary appointment shall the same purpose. Moreover, if a designation is
not exceed twelve months, but the appointee may not to be deemed included in the term
be replaced sooner if a qualified civil service appointment under Section 49 of P.D. No. 807,
eligible becomes available. 23 then the prohibition on nepotism would be
meaningless and toothless. Any appointing
Petitioner could not legally and validly appoint his
authority may circumvent it by merely
brother Benjamin Laurel to said position because
designating, and not appointing, a relative within
of the prohibition on nepotism under Section 49 of
the prohibited degree to a vacant position in the
P.D. No. 807. They are related within the third
career service. Indeed, as correctly stated by
degree of consanguinity and the case does not fall
public respondent, "what cannot be done directly
within any of the exemptions provided therein.
cannot be done indirectly." 28
Petitioner, however, contends that since what he
3. As regards the last issue, We rule that the
extended to his brother is not an appointment,
letter-complaint of Sangalang was validly given
but a DESIGNATION, he is not covered by the
due course by public respondent. Undoubtedly, as
prohibition. Public respondent disagrees, for:
shown above, there was a violation of law
By legal contemplation, the prohibitive mantle on committed by petitioner in designating his brother
nepotism would include designation, because as Acting Provincial Administrator. Any citizen of
what cannot be done directly cannot be done the Philippines may bring that matter to the
indirectly. 24 attention of the Civil Service Commission for
We cannot accept petitioner's view. His specious appropriate action conformably with its role as the
and tenuous distinction between appointment and central personnel agency to set standards and to
designation is nothing more than either a ploy enforce the laws and rules governing the
ingeniously conceived to circumvent the rigid rule selection, utilization, training and discipline of civil
on nepotism or a last-ditch maneuver to cushion servants, 29 with the power and function to
the impact of its violation. The rule admits of no administer and enforce the Constitutional and
distinction between appointment and designation. statutory provisions on the merit system. 30
Designation is also defined as "an appointment or Moreover, Section 37 of the decree expressly
assignment to a particular office"; and "to allows a private citizen to directly file with the
designate" means "to indicate, select, appoint or Civil Service Commission a complaint against a
set apart for a purpose or duty. 25 government official or employee, in which case it
may hear and decide the case or may deputize
In Borromeo vs. Mariano, 26 this Court said: any department or agency or official or group of
. . . All the authorities unite in saying that the officials to conduct an investigation. The results of
term "appoint" is well-known in law and whether the investigation shall be submitted to the
regarded in its legal or in its ordinary acceptation, Commission with recommendation as to the
is applied to the nomination or designation of an penalty to be imposed or other action to be taken.
individual . . . (emphasis supplied). This provision gives teeth to the Constitutional
exhortation that a public office is a public trust
In Binamira vs. Garrucho, 27 this Court, per Mr. and public officers and employees must at all
Justice Isagani M. Cruz, stated: times be, inter alia, accountable to the people. 31
Designation may also be loosely defined as an An ordinary citizen who brings to the attention of
appointment because it likewise involves the the appropriate office any act or conduct of a
naming of a particular person to a specified public government official or employee which betrays
office. That is the common understanding of the the public interest deserves nothing less than the
term. However, where the person is merely praises, support and encouragement of society.
designated and not appointed, the implication is The vigilance of the citizenry is vital in a
that he shall hold the office only in a temporary democracy.
capacity and may be replaced at will by the WHEREFORE, this petition is DENIED for lack of
appointing authority. In this sense, the merit, and the challenged Resolutions of the Civil
designation is considered only an acting or Service Commission are AFFIRMED.
temporary appointment, which does not confer
security of tenure on the person named. Costs against petitioner.
It seems clear to Us that Section 49 of P.D. No. SO ORDERED.
807 does not suggest that designation should be Fernan, C.J., Gutierrez, Jr., Bidin and Romero, JJ.,
differentiated from appointment. Reading this concur.
section with Section 25 of said decree, career
service positions may be filled up only by
appointment, either permanent or temporary; # Footnotes
1 Section 6 of P.D. No. 807. HONORABLE SIMPLICIO C. GRIÑO, SIXTO P.
DEMAISIP, SANTOS B. AGUADERA, MANUEL
2 Annex "C" of Petition.
B. TRAVIÑA and MANUEL M. CASUMPANG,
3 Annexes "B" and "B-1" of Petition. petitioners,
4 Loc cit. vs.
CIVIL SERVICE COMMISSION, TEOTIMO
5 Annex "D" of Petition. ARANDELA, CIRILO GELVEZON, TEODULFO
6 Annex "D" of Petition, 3. DATO-ON, and NELSON GEDUSPAN,
respondents.
7 Annex "B" of Petition.
Sixto P. Demaisip for petitioners.
8 Annex "E" of Petition.
Rex C. Muzones for private respondents.
9 Annex "A" of Petition.
Thelma A. Panganiban-Gaminde, Rogelio C.
10 52 Phil. 1. Limare and Normita M. Llamas-Villanueva for Civil
11 136 SCRA 27, G.R. No. 63915, 24 April 1985. Service Commission.
12 73 SCRA 275.
13 18 SCRA 417. GANCAYCO, J.:p
14 Annex "D" of Petition. The main issue in this petition is whether or not
the position of a provincial attorney and those of
15 See Llacer vs. Muñoz, et al., 12 Phil. 328.
his legal subordinates are primarily confidential in
16 Annex "G" of Petition; Rollo, 55. This was nature so that the services of those holding the
prepared in 1976 and revised in 1977 under a said items can be terminated upon loss of
Joint Program of the Civil Sevice Commission , the confidence.
Provincial Management Project and the USAID
The facts of this case are simple.
Philippine Mission.
Petitioner Sixto Demaisip was the first appointed
17 No. (1) Second paragraph, Section 5, P.D. No.
Provincial Attorney of Iloilo. He held this position
807.
from April 3, 1973 up to June 2, 1986 when he
18 Supra. offered to resign and his resignation was accepted
19 This is Section 4 of Article XII of the 1935 by the then Acting Governor. In his resignation
Constitution which provides: letter, petitioner Demaisip recommended the
elevation of respondent Teotimo Arandela from
No officer or employee in the Civil Service shall be Senior Legal Officer to Provincial Attorney. OIC
removed or suspended except for cause as Governor Licurgo Tirador later on decided to
provided by law. appoint respondent Arandela as the Provincial
20 Rollo, 101. Attorney. Respondent Cirilo Gelvezon, on the
other hand, was promoted from Legal Officer II to
21 Supra. Senior Legal Officer. Respondents Teodolfo Dato-
22 Supra. on and Nelson Geduspan were appointed to the
position of Legal
23 Section 25, P.D. No. 807.
Officer II.
24 Annex "B" of Petition.
On February 2, 1988, petitioner Simplicio Griño
25 Black's Law Dictionary, Fifth ed., 402. assumed office as the newly elected governor of
26 41 Phil. 322, 326-327. Iloilo. One month later, he informed respondent
Arandela and all the legal officers at the Provincial
27 188 SCRA 154, 159. Attorney's Office about his decision to terminate
28 Annex "D" of Petition. their services. In his letter, petitioner Griño made
mention of an article pertaining to the Iloilo office
29 Section 2 (Declaration of Policy), P.D. No. 807. of the Provincial Attorney which appeared in the
30 Section 9(a), P.D. No. 807. Panay News and which "undermined that trust
and confidence" that he reposed on them.
31 Sec. 1, Article XI, 1987 Constitution. See Also
Petitioner Demaisip was reappointed by Governor
Sec. 1 Article XIII, 1973 Contitution.
Griño as the Provincial Attorney, The latter, on the
Republic of the Philippines other hand, arranged the replacements of the
SUPREME COURT other legal officers. Respondent Cirilo Gelvezon
Manila was replaced by petitioner Santos Aguadera,
EN BANC respondent Nelson Geduspan was replaced by
petitioner Manuel Casumpang and petitioner
Manuel Traviña took the place of respondent
G.R. No. 91602 February 26, 1991 Teodolfo Dato-on.
On March 15, 1988, petitioner Governor Griño The tenure of officials holding primarily
formally terminated the services of the confidential positions ends upon loss of
respondents herein on the ground of loss of trust confidence, because their term of office lasts only
and confidence. This action taken by the governor as long as confidence in them endure; and thus
was appealed by respondents to the Merit their cessation involves no removal (Corpus vs.
Systems Protection Board of the Civil Service Cuaderno, L-23721, March 31, 1965, 13 SCRA
Commission. 591-596). When such confidence is lost and the
officer holding such position is separated from the
On March 9, 1989, the Merit Systems Board
service, such cessation entails no removal but an
issued an Order declaring the respondents'
expiration of his term. In the case of Hernandez
termination illegal and ordering that they be
vs. Villegas, L-17287, June 30, 1965, 14 SCRA
immediately restored to their positions with back
548, it was held —
salaries and other emoluments due them. This
was appealed by petitioner Griño to the Civil It is to be understood of course that officials and
Service Commission. employees holding primarily confidential positions
continue only for so long as confidence in them
In Resolution No. 89-736 dated October 9, 1989,
endures. The termination of their official relation
the Civil Service Commission affirmed the Order
can be justified on the ground of loss of
of the Merit Systems Protection Board, and
confidence because in that case their cessation
directed that the respondents be restored to their
from office involves no removal but merely the
former legal positions and be paid back salaries
expiration of the term of office — two different
and other benefits.
causes for the termination of official relations
Petitioners filed a Motion for Reconsideration of recognized in the Law of Public Officers.
the above-mentioned Decision of the Civil Service
In the case at bar, when the respondent City
Commission. The motion was denied on
Mayor of Davao terminated the services of the
December 7, 1989 in Resolution No. 89-920.
petitioner, he was not removed or dismissed.
Hence, this petition for review whereby There being no removal or dismissal it could not,
petitioners seek the reversal of Resolution No. 89- therefore, be said that there was a violation of the
736 of the Civil Service Commission and constitutional provision that "no officer or
Resolution No. 89-920 which denied the Motion employee in the civil service shall be suspended
for Reconsideration. or dismissed except for cause as provided by law"
We shall first discuss whether the position of a (Article XII-B, Section 1 (3), 1973 Constitution).
provincial attorney is primarily confidential so that The matter of expiration of a term of an officer
the holder thereof may be terminated upon loss of holding a primarily confidential position, as
confidence. distinguished from a removal or dismissal, was
In Cadiente vs. Santos, 1 this Court ruled that the further explained by this Court, in the case of
position of a city legal officer is undeniably one Ingles vs. Mutuc, L-20390, November 29, 1960, 26
which is primarily confidential in this manner: SCRA 171, in this wise:

In resolving the merits of the instant case, We find When an incumbent of a primarily confidential
as an undeniable fact that the position of a City position holds office at the pleasure of the
Legal Officer is one which is "primarily appointing power, and the pleasure turns into a
confidential." This Court held in the case of displeasure, the incumbent is not removed or
Claudio vs. Subido, L-30865, August 31, 1971, 40 dismissed from office — his term merely expires,
SCRA 481, that the position of a City Legal Officer in much the same way as an officer, whose right
is one requiring that utmost confidence on the thereto ceases upon expiration of the fixed term
part of the mayor be extended to said officer. The for which he had been appointed or elected, is not
relationship existing between a lawyer and his and cannot be deemed removed or dismissed
client, whether a private individual or a public therefrom, upon expiration of said term.
officer, is one that depends on the highest degree The main difference between the former — the
of trust that the latter entertains for the counsel primary confidential officer — and the latter is
selected. As stated in the case of Pinero vs. that the latter's term is fixed or definite, whereas
Hechanova, L-22562, October 22, 1966, 18 SCRA that of the former is not pre-fixed, but indefinite,
417 (citing De los Santos vs. Mallare, 87 Phil. at the time of his appointment or election, and
289), the phrase "primarily confidential" "denotes becomes fixed and determined when the
not only confidence in the aptitude of the appointing power expresses its decision to put an
appointee for the duties of the office but primarily end to the services of the incumbent. When this
close intimacy which insures freedom of event takes place, the latter is not removed or
intercourse, without embarrassment or freedom dismissed from office — his term merely expired.
from misgivings of betrayals of personal trust on
The foregoing merely elaborates what this Court,
confidential matters of state. (Emphasis supplied.)
speaking thru Justice J.B.L. Reyes, stressed in the
case Corpus vs. Cuaderno, L-23721, March 31, counterpart in the province a provincial attorney
1965, 13 SCRA 591. In said case We stated that: appointed by the provincial governor. In the same
vein, a municipality may have a municipal
The tenure of officials holding primarily
attorney who is to be named by the appointing
confidential positions ends upon loss of
power. The positions of city legal officer and
confidence, because their term of office lasts only
provincial attorney were created under Republic
as long as confidence in them endures, and thus
Act No. 5185 which categorized them together as
their cessation involves no removal. 2
positions of "trust", to wit:
In Besa vs. Philippine National Bank, 3 where
Sec. 19. Creation of positions of Provincial
petitioner, who was the Chief Legal Counsel with
Attorney and City Legal officer. — To enable the
the rank of Vice President of the respondent
provincial and city governments to avail
Philippine National Bank, questioned his being
themselves of the full time and trusted services of
transferred to the position of Consultant on Legal
legal officers, the positions of provincial attorney
Matters in the Office of President, this Court,
and city legal officer may be created and such
considering said position to be primarily
officials shall be appointed in such manner as is
confidential held —
provided for under Section four of this Act. For
It cannot be denied of course that the work of the this purpose the functions hitherto performed by
Chief Legal Counsel of respondent Bank, as of any the provincial and city fiscals in serving as legal
lawyer for that matter, is impressed with a highly adviser and legal officer for civil cases of the
technical aspect. As had been pointed out, province and city shall be transferred to the
however, it does not mean that thereby a client is provincial attorney and city legal officer,
precluded from substituting in his stead another respectively. (Emphasis supplied.) 4
practitioner. That is his right; Ms decision to
By virtue of Republic Act No. 5185, both the
terminate the relationship once made is
provincial attorney and city legal officer serve as
impressed with the attribute of finality. The
the legal adviser and legal officer for the civil
lawyer cannot be heard to complain; it is enough
cases of the province and the city that they work
that his right to compensation earned be duly
for. Their services are precisely categorized by
respected.
law to be "trusted services."
In that sense, it is equally clear that where the
A comparison of the functions, powers and duties
position partakes of the attributes of being both
of a city legal officer as provided in the Local
technical and confidential, there can be no
Government Code with those of the provincial
insistence of a fixed or a definite term if the latter
attorney of Iloilo would reveal the close similarity
aspect predominates. To paraphrase the language
of the two positions. Said functions clearly reflect
of the Chief Justice in the opinion previously cited,
the highly confidential nature of the two offices
the incumbent of a primarily confidential position,
and the need for a relationship based on trust
as was the case of petitioner, should realize that
between the officer and the head of the local
at any time the appointing power may decide that
government unit he serves. The "trusted services"
his services are no longer needed. As thus
to be rendered by the officer would mean such
correctly viewed, Corpus v. Cuaderno cannot be
trusted services of a lawyer to his client which is
read as lending support to petitioner's efforts to
of the highest degree of trust. 5
retain his position as Chief Legal Counsel of
respondent Bank, contrary to its wishes as so The fact that the position of respondent Arandela
explicitly declared in its Resolution No. 1053. as provincial attorney has already been classified
as one under the career service and certified as
The question now is — should the ruling in
permanent by the Civil Service Commission
Cadiente be made applicable to a provincial
cannot conceal or alter its highly confidential
attorney? According to the petitioners, Cadiente
nature. As in Cadiente where the position of the
must be applied because by the nature of the
city legal officer was duly attested as permanent
functions of a provincial attorney and a city legal
by the Civil Service Commission before this Court
officer, their positions are both primarily
declared that the same was primarily confidential,
confidential. Respondents, on the other hand,
this Court holds that the position of respondent
maintain that since the Civil Service Commission
Arandela as the provincial attorney of Iloilo is also
has already classified the position of private
a primarily confidential position. To rule otherwise
respondent Arandela as a career position and
would be tantamount to classifying two positions
certified the same as permanent, he is removable
with the same nature and functions in two
only for cause, and therefore Cadiente is not
incompatible categories. This being the case, and
applicable.
following the principle that the tenure of an
We agree with the petitioners and answer the official holding a primarily confidential position
question earlier propounded in the affirmative. A ends upon loss of confidence, 6 the Court finds
city legal officer appointed by a city mayor to that private respondent Arandela was not
work for and in behalf of the city has for its dismissed or removed from office when his
services were terminated. His term merely employee, as a reasonably competent office head,
expired. through the exercise of his power to "review,
approve, reverse, or modify" their acts and
The attorney-client relationship is strictly personal
decisions. 14 At this level, the client can be
because it involves mutual trust and confidence of
protected without need of imposing upon the
the highest degree, irrespective of whether the
lower-ranked lawyers the fiduciary duties inherent
client is a private person or a government
in the attorney-client relationship. Hence, there is
functionary. 7 The personal character of the
now no obstacle to giving full effect to the
relationship prohibits its delegation in favor of
security of tenure principle to these members of
another attorney without the client's consent. 8
the civil service.
However, the legal work involved, as
Thus, with respect to the legal assistants or
distinguished from the relationship, can be
subordinates of the provincial attorney namely,
delegated. 9 The practice of delegating work of a
Cirilo Gelvezon, Teodolfo Dato-on and Nelson
counsel to his subordinates is apparent in the
Geduspan, the Cadiente and Besa rulings cannot
Office of the Provincial Attorney wherein it can be
apply. To recall, said cases specifically dealt with
gleaned from the power granted to such officer to
the positions of city legal officer of the city and
exercise administrative supervision and control
chief legal counsel of the PNB. There was no
over the acts and decision of his subordinates. 10
reference to their legal staff or subordinates. As
It is therefore possible to distinguish positions in head of their respective departments, the city
the civil service where lawyers act as counsel in legal officer, the provincial attorney or the PNB
confidential and non-confidential positions by chief legal counsel cannot be likened to their
simply looking at the proximity of the position in subordinates. The latter have been employed due
question in relation to that of the appointing to their technical qualifications. Their positions
authority. Occupants of such positions would be are highly technical in character and not
considered confidential employees if the confidential, so they are permanent employees,
predominant reason they were chosen by the and they belong to the category of classified
appointing authority is the latter's belief that he employees under the Civil Service Law. Thus, the
can share a close intimate relationship with the items of Senior Legal Officer and Legal Officer II
occupant which measures freedom of discussion, remain permanent as classified by the Civil
without fear of embarrassment or misgivings of Service Commission. Consequently, the holders of
possible betrayal of personal trust on confidential the said items, being permanent employees,
matters of state. 11 enjoy security of tenure as guaranteed under the
This implies that positions in the civil service of Constitution.
such nature would be limited to those not This notwithstanding, petitioners contend that
separated from the position of the appointing respondents are estopped from protesting the
authority by an intervening public officer, or termination of their services because of their
series of public officers, in the bureaucratic actions which, if taken together, would allegedly
hierarchy. This is an additional reason why the reveal that they have accepted their termination,
positions of "City Legal Officer" and "Private such as: applying for clearances, not remaining in
Secretary to the President" were considered office and signing their payroll for March 15, 1988
primarily confidential by the Court. 12 On the other acknowledging therein that their appointment
hand, a customs policeman serving in the Harbor "terminated/expired."
Patrol, in relation to the Commissioner of
We cannot agree with petitioners in this regard.
Customs, and an executive assistant,
The respondents did the above-mentioned acts
stenographer, or clerk in the Office of the
because their services were actually dispensed
President, were not considered so by the Court. 13
with by petitioner Governor Griño. As a
There is no need to extend the professional consequence of their termination, they could not
relationship to the legal staff which assists the remain in office and as required of any
confidential employer above described. Since the government employee who is separated from the
positions occupied by these subordinates are government service, they had to apply for
remote from that of the appointing authority, the clearances. However, this did not mean that they
element of trust between them is no longer believed in principle that they were validly
predominant. The importance of these terminated. The same should not prevent them
subordinates to the appointing authority now lies from later on questioning the validity of said
in the contribution of their legal skills to facilitate termination.
the work of the confidential employee. At this
The facts clearly show that respondents protested
level of the bureaucracy, any impairment of the
their termination with the Civil Service
appointing authority's interest as a client, which
Commission within a month from the time of their
may be caused through the breach of residual
termination. The Court holds that the said protest
trust by any of these lower-ranked lawyers, can
was filed within a reasonable period of time.
be anticipated and prevented by the confidential
WHEREFORE, and in view of the foregoing, the system", whereby everytime a new Governor is
petition is GRANTED with respect to the position elected, he can appoint his own man by
of provincial attorney of Iloilo. Respondent terminating the services of the one holding the
Teotimo Arandela is hereby ordered to vacate position, regardless of his competence and
said position upon the finality of this Decision. The performance, on the basis (in reality, pretext) of
Decision of the respondent Civil Service an alleged "loss of confidence", leaving the
Commission pertaining to respondents Cirilo appointees to said position at the mercy of the
Gelvezon, Teodolfo Dato-on and Nelson Geduspan Governor's whims and caprices. To clothe the
is hereby AFFIRMED. Governor with an unlimited or blanket authority to
dismiss the Provincial Attorney on the ground of
SO ORDERED.
such generality as "loss of confidence" only
Fernan, C.J., Narvasa, Melencio-Herrera, Cruz, aggravates the problem which has for too long
Paras, Feliciano, Bidin, Medialdea and Regalado, plagued this country and that is the undue
JJ., concur. dominance of partisan politics in the appointment
Gutierrez, Jr., J., concurs in the result. and retention of government officers and/or
employees. Such practice only hinders the growth
Griño-Aquino and Davide, Jr., JJ., took no part. of trained-career personnel in the government
service resulting in the demoralization of those
officers and/or employees who would prefer to
stake their fate in the government service on the
basis of merit.
Separate Opinions The Office of Provincial Attorney is composed of a
Provincial Attorney, one (1) Senior Legal Officer,
five (5) Legal Officers and its administrative staff.
PADILLA, J., concurring and dissenting: Private respondent Teotimo Arandela rose from
I concur with the majority opinion in its the ranks, wherein he started as Legal Officer III,
classification of the positions of legal assistants or to Senior Legal Officer and finally to Provincial
subordinates of the Provincial Attorney as highly Attorney, under the terms of three (3) Governors,
technical in character, falling under the category before Gov. Griño was elected to office. 1 To
of permanent employees, with security of tenure unceremoniously terminate private respondent
under the civil service system. I dissent, however, Arandela, who has risen from the ranks and who
from the majority opinion in its treatment of the has been in government service for many years,
position of Provincial Attorney, for the following at the pleasure or fancy of an incumbent
reasons: Governor, is, to my mind, contrary to the
constitutional provision that "no officer or
The position of Provincial Attorney was created employee of the civil service shall be removed or
under Sec. 19 of RA 5185 to enable the provincial suspended except for cause provided by law."
government to avail of the legal advice and
services of its own counsel in civil cases affecting Abuse of power in the termination and/or
the province. Although the power to appoint the suspension of an appointee to the position of
Provincial Attorney is vested in the Governor, Provincial Attorney or of a similar position on the
however, the said local public officer is an basis of "loss of confidence" which is not duly
employee of the provincial government to which substantiated should not be allowed. The reason
he owes his loyalty, and not to the elected stated by the Governor for his alleged loss of trust
Governor, for he is not part of the latter's personal and confidence in private respondent was that
or confidential staff. As a provincial public officer, " . . . an article pertaining to your office which
the Provincial Attorney's suspension, removal or appeared yesterday in Panay News undermined
transfer is subject to the provisions of the civil that trust and confidence which should otherwise
service law, rules and regulations. In other words, prevail." Whatever the content of said article
he may not be removed or suspended except for which allegedly triggered the loss of confidence
cause provided by law. More specifically, he may on the part of the Governor in the private
be removed from office for incompetence, respondent was not specifically stated in his letter
dishonesty, or other misconduct but not for the dated 1 March 1988 dispensing with the services
Governor's loss of confidence in him, which by its of the private respondent. 2 The reason given by
very nature, can be as broad as anything the Governor in terminating private respondent's
imaginable. services does not only appear unsubstantiated
but is vague and uncertain.
In its resolution, the Civil Service Commission has
classified the position of Provincial Attorney as a The presence of Cadiente vs. Santos, 142 SCRA
career service position and a permanent one. It is 280 (1980), upon which the majority opinion relies
but proper that a career position be developed for in support of its thesis that the Provincial Attorney
the Provincial Attorney to minimize the "spoils may be terminated at any time by the Provincial
Governor upon loss of confidence, should be the
last thing to bother one in attempting to establish
a wholesome doctrine in the law of public officers.
Separate Opinions
ACCORDINGLY, I vote to DISMISS the Petition and
to AFFIRM the questioned Civil Service PADILLA, J., concurring and dissenting:
Commission rulings in favor of private I concur with the majority opinion in its
respondents. classification of the positions of legal assistants or
SARMIENTO, J., concurring & dissenting: subordinates of the Provincial Attorney as highly
technical in character, falling under the category
I concur with the first part of the ponencia holding of permanent employees, with security of tenure
that the position of a provincial attorney under the civil service system. I dissent, however,
appointed by the provincial governor being akin from the majority opinion in its treatment of the
to that of a city legal officer appointed by the city position of Provincial Attorney, for the following
mayor, is primarily confidential and hence, the reasons:
termination from office of the provincial attorney
follows as a consequence of the loss of confidence The position of Provincial Attorney was created
upon him by the provincial governor. under Sec. 19 of RA 5185 to enable the provincial
government to avail of the legal advice and
However, I can not agree with the second part of services of its own counsel in civil cases affecting
the decision when it refused to apply the same the province. Although the power to appoint the
aforementioned ruling to the case of legal Provincial Attorney is vested in the Governor,
assistants or subordinate lawyers on the however, the said local public officer is an
justification that the earlier cases of Cadiente and employee of the provincial government to which
Besa only specifically dealt with the positions of he owes his loyalty, and not to the elected
city legal officer and PNB chief legal counsel, Governor, for he is not part of the latter's personal
respectively, and that the positions of legal or confidential staff. As a provincial public officer,
assistants or subordinate lawyers are highly the Provincial Attorney's suspension, removal or
technical in character and not confidential. transfer is subject to the provisions of the civil
While it is true that Cadiente and Besa only service law, rules and regulations. In other words,
involved a city legal officer and the PNB chief he may not be removed or suspended except for
legal counsel, the same cases do not by any cause provided by law. More specifically, he may
means preclude the application of the said be removed from office for incompetence,
precedents to legal assistants or subordinate dishonesty, or other misconduct but not for the
lawyers in appropriate cases when such issue is Governor's loss of confidence in him, which by its
squarely raised as presently. very nature, can be as broad as anything
imaginable.
Anent the claim that the positions of assistant
legal officers or subordinate lawyers is highly In its resolution, the Civil Service Commission has
technical and not confidential, this contention is classified the position of Provincial Attorney as a
not supported by any evidence on record or any career service position and a permanent one. It is
basis in law. On the contrary, the function of an but proper that a career position be developed for
assistant or a subordinate legal officer, as can be the Provincial Attorney to minimize the "spoils
gleaned from the Local Government Code, is to system", whereby everytime a new Governor is
"assist the chief officer and perform such duties elected, he can appoint his own man by
as the latter may assign him." I can not see how terminating the services of the one holding the
such a function can be any less confidential than position, regardless of his competence and
that of the chief legal officer. performance, on the basis (in reality, pretext) of
an alleged "loss of confidence", leaving the
Absent any showing of substantial distinctions
appointees to said position at the mercy of the
between the nature of the work or function of the
Governor's whims and caprices. To clothe the
provincial attorney and that of the legal assistants
Governor with an unlimited or blanket authority to
or subordinate lawyers, it is logical to presume
dismiss the Provincial Attorney on the ground of
that both public officers handle confidential
such generality as "loss of confidence" only
matters relating to the legal aspect of provincial
aggravates the problem which has for too long
administration and that their relationship with
plagued this country and that is the undue
their appointing power is that of a lawyer and his
dominance of partisan politics in the appointment
client requiring utmost confidence and the highest
and retention of government officers and/or
degree of trust. Hence, both positions being
employees. Such practice only hinders the growth
primarily confidential, the termination from office
of trained-career personnel in the government
of the legal assistants or subordinate lawyers
service resulting in the demoralization of those
must likewise follow as a consequence of the loss
officers and/or employees who would prefer to
of confidence upon them by the provincial
governor.
stake their fate in the government service on the aforementioned ruling to the case of legal
basis of merit. assistants or subordinate lawyers on the
justification that the earlier cases of Cadiente and
The Office of Provincial Attorney is composed of a
Besa only specifically dealt with the positions of
Provincial Attorney, one (1) Senior Legal Officer,
city legal officer and PNB chief legal counsel,
five (5) Legal Officers and its administrative staff.
respectively, and that the positions of legal
Private respondent Teotimo Arandela rose from
assistants or subordinate lawyers are highly
the ranks, wherein he started as Legal Officer III,
technical in character and not confidential.
to Senior Legal Officer and finally to Provincial
Attorney, under the terms of three (3) Governors, While it is true that Cadiente and Besa only
before Gov. Griño was elected to involved a city legal officer and the PNB chief
office. 1 To unceremoniously terminate private legal counsel, the same cases do not by any
respondent Arandela, who has risen from the means preclude the application of the said
ranks and who has been in government service precedents to legal assistants or subordinate
for many years, at the pleasure or fancy of an lawyers in appropriate cases when such issue is
incumbent Governor, is, to my mind, contrary to squarely raised as presently.
the constitutional provision that "no officer or Anent the claim that the positions of assistant
employee of the civil service shall be removed or legal officers or subordinate lawyers is highly
suspended except for cause provided by law." technical and not confidential, this contention is
Abuse of power in the termination and/or not supported by any evidence on record or any
suspension of an appointee to the position of basis in law. On the contrary, the function of an
Provincial Attorney or of a similar position on the assistant or a subordinate legal officer, as can be
basis of "loss of confidence" which is not duly gleaned from the Local Government Code, is to
substantiated should not be allowed. The reason "assist the chief officer and perform such duties
stated by the Governor for his alleged loss of trust as the latter may assign him." I can not see how
and confidence in private respondent was that such a function can be any less confidential than
" . . . an article pertaining to your office which that of the chief legal officer.
appeared yesterday in Panay News undermined Absent any showing of substantial distinctions
that trust and confidence which should otherwise between the nature of the work or function of the
prevail." Whatever the content of said article provincial attorney and that of the legal assistants
which allegedly triggered the loss of confidence or subordinate lawyers, it is logical to presume
on the part of the Governor in the private that both public officers handle confidential
respondent was not specifically stated in his letter matters relating to the legal aspect of provincial
dated 1 March 1988 dispensing with the services administration and that their relationship with
of the private respondent. 2 The reason given by their appointing power is that of a lawyer and his
the Governor in terminating private respondent's client requiring utmost confidence and the highest
services does not only appear unsubstantiated degree of trust. Hence, both positions being
but is vague and uncertain. primarily confidential, the termination from office
The presence of Cadiente vs. Santos, 142 SCRA of the legal assistants or subordinate lawyers
280 (1980), upon which the majority opinion relies must likewise follow as a consequence of the loss
in support of its thesis that the Provincial Attorney of confidence upon them by the provincial
may be terminated at any time by the Provincial governor.
Governor upon loss of confidence, should be the Footnotes
last thing to bother one in attempting to establish
a wholesome doctrine in the law of public officers. 1 142 SCRA 280, (1986).
ACCORDINGLY, I vote to DISMISS the Petition and 2 Supra, pages 284 to 286.
to AFFIRM the questioned Civil Service 3 33 SCRA 330, 337.
Commission rulings in favor of private
respondents. 4 Section 19, Republic Act No. 5185.
SARMIENTO, J., concurring & dissenting: 5 Cadiente vs. Santos, supra.

I concur with the first part of the ponencia holding 6 Corpus vs. Cuaderno, Sr., 13 SCRA 591 (1965).
that the position of a provincial attorney 7 In Re Sycip, 92 SCRA 10 (1979) and Claudio vs.
appointed by the provincial governor being akin Subido, 40 SCRA 481 (1971).
to that of a city legal officer appointed by the city
8 Menzi & Company vs. Bastida, 63 Phil. 16
mayor, is primarily confidential and hence, the
termination from office of the provincial attorney (1936).
follows as a consequence of the loss of confidence 9 In Ke Kaeunerer, 178 S.W. 2d 481 (1944).
upon him by the provincial governor.
10 Section 38(c), Chapter 7, Book 4, Revised
However, I can not agree with the second part of Administrative Code of 1987.
the decision when it refused to apply the same
11 Cadiente vs. Santos, supra; Besa vs. PNB, Resolution No. 92-1283 which affirmed the
supra. decision of the MSPB.
12 Cadiente vs. Santos, supra; Claudia supra; Respondent Salas initially went to this Court on a
Ingles vs. Mutuc, 26 SCRA 171 (1968). petition for certiorari assailing the propriety of the
questioned CSC resolution. However, in a
13 Pinero vs. Hechanova, 18 SCRA 417, 423-424
resolution dated August 15, 1995, the case was
(1966); Ingles vs. Mutuc, supra.
referred to the Court of Appeals pursuant to
14 Revised Administrative Code. Revised Administrative Circular No. 1-95 which
PADILLA, J., concurring & dissenting: took effect on June 1, 1995.

1 Rollo, p. 103. On September 14, 1995, the court of Appeals


rendered its questioned decision with the finding
2 Rollo, p. 13. that herein respondent Salas is not a confidential
EN BANC employee, hence he may not be dismissed on the
ground of loss of confidence. In so ruling, the
[G.R. No. 123708. June 19, 1997] appellate court applied the "proximity rule"
CIVIL SERVICE COMMISSION and PHILIPPINE enunciated in the case of Griño, et al. vs. Civil
AMUSEMENT AND GAMING CORPORATION, Service Commission, et al.. It likewise held that
petitioners, vs. RAFAEL M. SALAS, respondent. Section 16 of Presidential Decree No. 1869 has
been superseded and repealed by Section 2(1),
DECISION
Article IX-B of the 1987 Constitution.
REGALADO, J.:
Hence this appeal, which is premised on and calls
The present petition for review on certiorari seeks for the resolution of the sole determinative issue
to nullify the decision of the Court of Appeals, of whether or not respondent Salas is a
dated September 14, 1995, in CA-G.R. SP No. confidential employee.
38319 which set aside Resolution No. 92-1283 of
Petitioners aver that respondent Salas, as a
the Civil Service Commission (CSC) and ordered
member of the Internal Security Staff of PAGCOR,
the reinstatement of herein private respondent
is a confidential employee for several reasons,
Rafael M. Salas with full back wages for having
viz.:
been illegally dismissed by the Philippine
Amusement and Gaming Corporation (PAGCOR), (1) Presidential Decree No. 1869 which created
but without prejudice to the filing of the Philippine Amusement and Gaming
administrative charges against him if warranted. Corporation expressly provides under Section 16
thereof that all employees of the casinos and
The records disclose that on October 7, 1989,
related services shall be classified as confidential
respondent Salas was appointed by the PAGCOR
appointees;
Chairman as Internal Security Staff (ISS) member
and assigned to the casino at the Manila Pavilion (2) In the case of the Philippine Amusement
Hotel. However, his employment was terminated and Gaming Corporation vs. Court of Appeals, et
by the Board of Directors of PAGCOR on al., The Supreme Court has classified PAGCOR
December 3, 1991, allegedly for loss of employees as confidential appointees;
confidence, after a covert investigation conducted (3) CSC Resolution No. 91-830, dated July 11,
by the Intelligence Division of PAGCOR. The 1991, has declared employees in casinos and
summary of intelligence information claimed that related services as confidential appointees by
respondent was allegedly engaged in proxy operation of law; and
betting as detailed in the affidavits purportedly
executed by two customers of PAGCOR who (4) Based on his functions as a member of the
claimed that they were used as gunners on ISS, private respondent occupies a confidential
different occasions by respondent. The two position.
polygraph tests taken by the latter also yielded Whence, according to petitioners, respondent
corroborative and unfavorable results. Salas was not dismissed from the service but,
On December 23, 1991, respondent Salas instead, his term of office had expired. They
submitted a letter of appeal to the Chairman and additionally contend that the Court of Appeals
the Board of Directors of PAGCOR, requesting erred in applying the "proximity rule" because
reinvestigation of the case since he was not given even if Salas occupied one of the lowest rungs in
an opportunity to be heard, but the same was the organizational ladder of PAGCOR, he
denied. On February 17, 1992, he appealed to performed the functions of one of the most
the Merit Systems Protection Board (MSPB) which sensitive positions in the corporation.
denied the appeal on the ground that, as a On the other hand, respondent Salas argues that
confidential employee, respondent was not it is the actual nature of an employee's functions,
dismissed from the service but his term of office and not his designation or title, which determines
merely expired. On appeal, the CSC issued
whether or not a position is primarily confidential, However, the same cannot be said with respect to
and that while Presidential Decree No. 1869 may the last portion of Section 16 which provides that
have declared all PAGCOR employees to be "all employees of the casino and related services
confidential appointees, such executive shall be classified as 'confidential appointees.'"
pronouncement may be considered as a mere While such executive declaration emanated
initial determination of the classification of merely from the provisions of Section 2, Rule XX
positions which is not conclusive in case of of the implementing rules of the Civil Service Act
conflict, in light of the ruling enunciated in Tria vs. of 1959, the power to declare a position as policy-
Sto. Tomas, et al. determining, primarily confidential or highly
technical as defined therein has subsequently
We find no merit in the petition and consequently
been codified and incorporated in Section 12(9),
hold that the same should be, as it is hereby,
Book V of Executive Order No. 292 or the
denied.
Administrative Code of 1987. This later enactment
Section 2, Rule XX of the Revised Civil Service only serves to bolster the validity of the
Rules, promulgated pursuant to the provisions of categorization made under Section 16 of
Section 16(e) of Republic Act No. 2260 (Civil Presidential Decree No. 1869. Be that as it may,
Service Act of 1959), which was then in force such classification is not absolute and all-
when Presidential Decree No. 1869 creating the encompassing.
Philippine Amusement and Gaming Corporation
Prior to the passage of the aforestated Civil
was passed, provided that "upon recommendation
Service Act of 1959, there were two recognized
of the Commissioner, the President may declare a
instances when a position may be considered
position as policy-determining, primarily
primarily confidential: Firstly, when the President,
confidential, or highly technical in nature." It
upon recommendation of the Commissioner of
appears that Section 16 of Presidential Decree No.
Civil Service, has declared the position to be
1869 was predicated thereon, with the text
primarily confidential; and, secondly in the
thereof providing as follows:
absence of such declaration, when by the nature
"All positions in the corporation, whether of the functions of the office there exists "close
technical, administrative, professional or intimacy" between the appointee and appointing
managerial are exempt from the provisions of the power which insures freedom of intercourse
Civil Service Law, rules and regulations, and shall without embarrassment or freedom from
be governed only by the personnel management misgivings of betrayals of personal trust or
policies set by the Board of Directors. All confidential matters of state.
employees of the casinos and related services
At first glance, it would seem that the instant case
shall be classified as 'confidential' appointees."
falls under the first category by virtue of the
On the strength of this statutory declaration, express mandate under Section 16 of Presidential
petitioner PAGCOR terminated the services of Decree No. 1869. An in-depth analysis, however,
respondent Salas for lack of confidence after it of the second category evinces otherwise.
supposedly found that the latter was engaged in
When Republic Act No. 2260 was enacted on June
proxy betting. In upholding the dismissal of
19, 1959, Section 5 thereof provided that "the
respondent Salas, the CSC ruled that he is
non-competitive or unclassified service shall be
considered a confidential employee by operation
composed of positions expressly declared by law
of law, hence there is no act of dismissal to speak
to be in the non-competitive or unclassified
of but a mere expiration of a confidential
service or those which are policy-determining,
employee's term of office, such that a complaint
primarily confidential, or highly technical in
for illegal dismissal will not prosper in this case for
nature." In the case of Piñero, et al. vs.
lack of legal basis.
Hechanova, et al., the Court obliged with a short
In reversing the decision of the CSC, the Court of discourse there on how the phrase "in nature"
Appeals opined that the provisions of Section 16 came to find its way into the law, thus:
of Presidential Decree No. 1869 may no longer be
"The change from the original wording of the bill
applied in the case at bar because the same is
(expressly declared by law x x x to be policy-
deemed to have been repealed in its entirety by
determining, etc.) to that finally approved and
Section 2(1), Article IX-B of the 1987 Constitution.
enacted ('or which are policy-determining, etc. in
This is not completely correct. On this point, we
nature') came about because of the observations
approve the more logical interpretation advanced
of Senator Tañada, that as originally worded the
by the CSC to the effect that "Section 16 of PD
proposed bill gave Congress power to declare by
1869 insofar as it exempts PAGCOR positions from
fiat of law a certain position as primarily
the provisions of Civil Service Law and Rules has
confidential or policy-determining, which should
been amended, modified or deemed repealed by
not be the case. The Senator urged that since the
the 1987 Constitution and Executive Order No.
Constitution speaks of positions which are
292 (Administrative Code of 1987)."
'primarily confidential, policy-determining, or
highly technical in nature', it is not within the which are policy-determining, primarily
power of Congress to declare what positions are confidential, or highly technical in nature."
primarily confidential or policy-determining. 'It is Likewise, Section 1 of the General Rules in the
the nature alone of the position that determines implementing rules of Presidential Decree No. 807
whether it is policy-determining or primarily states that "appointments in the Civil Service,
confidential.' Hence, the Senator further except as to those which are the policy-
observed, the matter should be left to the 'proper determining, primarily confidential, or highly
implementation of the laws, depending upon the technical in nature, shall be made only according
nature of the position to be filled', and if the to merit and fitness to be determined as far as
position is 'highly confidential' then the President practicable by competitive examination." Let it
and the Civil Service Commissioner must here be emphasized, as we have accordingly
implement the law. italicized them, that these fundamental laws and
legislative or executive enactments all utilized the
To a question of Senator Tolentino, 'But in
phrase "in nature" to describe the character of the
positions that involved both confidential matters
positions being classified.
and matters which are routine, x x x who is going
to determine whether it is primarily confidential?' The question that may now be asked is whether
Senator Tañada replied: the Piñero doctrine -- to the effect that
notwithstanding any statutory classification to the
'SENATOR TAÑADA: Well, at the first instance, it is
contrary, it is still the nature of the position, as
the appointing power that determines that: the
may be ascertained by the court in case of
nature of the position. In case of conflict then it is
conflict, which finally determines whether a
the Court that determines whether the position is
position is primarily confidential, policy-
primarily confidential or not" (Italics in the original
determining or highly technical -- is still
text).
controlling with the advent of the 1987
Hence the dictum that, at least since the Constitution and the Administrative Code of 1987,
enactment of the Civil Service Act of 1959, it is Book V of which deals specifically with the Civil
the nature of the position which finally determines Service Commission, considering that from these
whether a position is primarily confidential, policy- later enactments, in defining positions which are
determining or highly technical. And the court in policy-determining, primarily confidential or highly
the aforecited case explicitly decreed that technical, the phrase "in nature" was deleted.
executive pronouncements, such as Presidential
We rule in the affirmative. The matter was
Decree No. 1869, can be no more than initial
clarified and extensively discussed during the
determinations that are not conclusive in case of
deliberations in the plenary session of the 1986
conflict. It must be so, or else it would then lie
Constitutional Commission on the Civil Service
within the discretion of the Chief Executive to
provisions, to wit:
deny to any officer, by executive fiat, the
protection of Section 4, Article XII (now Section "MR. FOZ. Which department of government has
2[3], Article IX-B) of the Constitution. In other the power or authority to determine whether a
words, Section 16 of Presidential Decree No. 1869 position is policy-determining or primarily
cannot be given a literally stringent application confidential or highly technical?
without compromising the constitutionally FR. BERNAS: The initial decision is made by the
protected right of an employee to security of legislative body or by the executive department,
tenure. but the final decision is done by the court. The
The doctrinal ruling enunciated in Piñero finds Supreme Court has constantly held that whether
support in the 1935 Constitution and was or not a position is policy-determining, primarily
reaffirmed in the 1973 Constitution, as well as in confidential or highly technical, it is determined
the implementing rules of Presidential Decree No. not by the title but by the nature of the task that
807, or the Civil Service Decree of the Philippines. is entrusted to it. For instance, we might have a
It may well be observed that both the 1935 and case where a position is created requiring that the
1973 Constitutions contain the provision, in holder of that position should be a member of the
Section 2, Article XII-B thereof, that Bar and the law classifies this position as highly
"appointments in the Civil Service, except as to technical. However, the Supreme Court has said
those which are policy-determining, primarily before that a position which requires mere
confidential, or highly technical in nature, shall be membership in the Bar is not a highly technical
made only according to merit and fitness, to be position. Since the term 'highly technical' means
determined as far as practicable by competitive something beyond the ordinary requirements of
examination." Corollarily, Section 5 of Republic the profession, it is always a question of fact.
Act No. 2260 states that "the non-competitive or MR. FOZ. Does not Commissioner Bernas agree
unclassified service shall be composed of that the general rule should be that the merit
positions expressly declared by law to be in the system or the competitive system should be
non-competitive or unclassified service or those upheld?
FR. BERNAS. I agree that that it should be the submission that PAGCOR employees have been
general rule; that is why we are putting this as an declared confidential appointees by operation of
exception. law under the bare authority of CSC Resolution
No. 91-830 must be rejected.
MR. FOZ. The declaration that certain positions
are policy-determining, primarily confidential or We likewise find that in holding that herein private
highly technical has been the source of practices respondent is not a confidential employee,
which amount to the spoils system. respondent Court of Appeals correctly applied the
"proximity rule" enunciated in the early but still
FR. BERNAS. The Supreme Court has always said
authoritative case of De los Santos vs. Mallare, et
that, but if the law of the administrative agency
al., which held that:
says that a position is primarily confidential when
in fact it is not, we can always challenge that in "Every appointment implies confidence, but much
court. It is not enough that the law calls it more than ordinary confidence is reposed in the
primarily confidential to make it such; it is the occupant of a position that is primarily
nature of the duties which makes a position confidential. The latter phrase denotes not only
primarily confidential. confidence in the aptitude of the appointee for the
duties of the office but primarily close intimacy
MR. FOZ. The effect of a declaration that a
which ensures freedom of intercourse without
position is policy-determining, primarily
embarrassment or freedom from misgivings of
confidential or highly technical — as an exception
betrayals of personal trust or confidential matters
— is to take it away from the usual rules and
provisions of the Civil Service Law and to place it of state. x x x" (Emphasis supplied).
in a class by itself so that it can avail itself of This was reiterated in Piñero, et al. vs.
certain privileges not available to the ordinary run Hechanova, et al., supra, the facts of which are
of government employees and officers. substantially similar to the case at bar, involving
as it did employees occupying positions in various
FR. BERNAS. As I have already said, this
capacities in the Port Patrol Division of the Bureau
classification does not do away with the
of Customs. The Court there held that the mere
requirement of merit and fitness. All it says is
fact that the members of the Port Patrol Division
that there are certain positions which should not
are part of the Customs police force is not in itself
be determined by competitive examination.
a sufficient indication that their positions are
For instance, I have just mentioned a position in primarily confidential. After quoting the foregoing
the Atomic Energy Commission. Shall we require passage from De los Santos, it trenchantly
a physicist to undergo a competitive examination declared:
before appointment? Or a confidential secretary
"As previously pointed out, there are no proven
or any position in policy-determining
facts to show that there is any such close
administrative bodies, for that matter? There are
intimacy and trust between the appointing power
other ways of determining merit and fitness than
and the appellees as would support a finding that
competitive examination. This is not a denial of
confidence was the primary reason for the
the requirement of merit and fitness" (Italics
existence of the positions held by them or for
supplied).
their appointment thereto. Certainly, it is
It is thus clearly deducible, if not altogether extremely improbable that the service demands
apparent, that the primary purpose of the framers any such closed trust and intimate relation
of the 1987 Constitution in providing for the between the appointing official and, not one or
declaration of a position as policy-determining, two members alone but the entire Customs patrol
primarily confidential or highly technical is to (Harbor Police) force, so that every member
exempt these categories from competitive thereof can be said to hold 'primarily confidential'
examination as a means for determining merit posts". (Stress supplied).
and fitness. It must be stressed further that these
It can thus be safely determined therefrom that
positions are covered by security of tenure,
the occupant of a particular position could be
although they are considered non-competitive
considered a confidential employee if the
only in the sense that appointees thereto do not
predominant reason why he was chosen by the
have to undergo competitive examinations for
appointing authority was, to repeat, the latter's
purposes of determining merit and fitness.
belief that he can share a close intimate
In fact, the CSC itself ascribes to this view as may relationship with the occupant which ensures
be gleaned from its questioned resolution wherein freedom of discussion, without fear of
it stated that "the declaration of a position is embarrassment or misgivings of possible betrayal
primarily confidential if at all, merely exempts the of personal trust or confidential matters of state.
position from the civil service eligibility Withal, where the position occupied is remote
requirement." Accordingly, the Piñero doctrine from that of the appointing authority, the element
continues to be applicable up to the present and of trust between them is no longer predominant.
is hereby maintained. Such being the case, the
Several factors lead to the conclusion that private confidential employee. As set out in the job
respondent does not enjoy such "close intimacy" description of his position, one is struck by the
with the appointing authority of PAGCOR which ordinary, routinary and quotidian character of his
would otherwise place him in the category of a duties and functions. Moreover, the modest rank
confidential employee, to wit: and fungible nature of the position occupied by
private respondent is underscored by the fact that
1. As an Internal Security Staff member, private
the salary attached to it is a meager P2,200.00 a
respondent routinely —
month. There thus appears nothing to suggest
a. performs duty assignments at the gaming that private respondents's position was "highly" or
and/or non-gaming areas to prevent irregularities, much less, "primarily" confidential in nature. The
misbehavior, illegal transactions and other fact that, sometimes, private respondent may
anomalous activities among the employees and handle ordinarily "confidential matters" or papers
customers, which are somewhat confidential in nature does
b. reports unusual incidents and related not suffice to characterize his position as primarily
observations/information in accordance with confidential.
established procedures for infractions/mistakes In addition, the allegation of petitioners that
committed on the table and in other areas; PAGCOR employees have been declared to be
c. coordinates with CCTV and/or external confidential appointees in the case of Philippine
security as necessary for the prevention, Amusement and Gaming Corporation vs. Court of
documentation or suppression of any unwanted Appeals, et al., ante, is misleading. What was
incidents at the gaming and non-gaming areas; there stated is as follows:

d. acts as witness/representative of Security "The record shows that the separation of the
Department during chips inventory, refills, yields, private respondent was done in accordance with
card shuffling and final shuffling; PD 1869, which provides that the employees of
the PAGCOR hold confidential positions. Montoya
e. performs escort functions during the is not assailing the validity of that law. The act
delivery of table capital boxes, refills and shoe that he is questioning is what he calls the
boxes to the respective tables, or during transfer arbitrary manner of his dismissal thereunder that
of yields to Treasury. he avers entitled her to damages under the Civil
Based on the nature of such functions of herein Code." (Italics ours).
private respondent and as found by respondent Thus, the aforecited case was decided on the
Court of Appeals, while it may be said that uncontested assumption that the private
honesty and integrity are primary considerations respondent therein was a confidential employee,
in his appointment as a member of the ISS, his for the simple reason that the propriety of Section
position does not involve "such close intimacy" 16 of Presidential Decree No. 1869 was never
between him and the appointing authority, that is, controverted nor raised as an issue therein. That
the Chairman of PAGCOR, as would ensure decree was mentioned merely in connection with
"freedom from misgivings of betrayals of personal its provision that PAGCOR employees hold
trust." confidential positions. Evidently, therefore, it
2. Although appointed by the Chairman, ISS cannot be considered as controlling in the case at
members do not directly report to the Office of bar. Even the fact that a statute has been
the Chairman in the performance of their official accepted as valid in cases where its validity was
duties. An ISS members is subject to the control not challenged does not preclude the court from
and supervision of an Area Supervisor who, in later passing upon its constitutionality in an
turn, only implements the directives of the Branch appropriate cause where that question is squarely
Chief Security Officer. The latter is himself and properly raised. Such circumstances merely
answerable to the Chairman and the Board of reinforce the presumption of constitutionality of
Directors. Obviously, as the lowest in the chain of the law.
command, private respondent does not enjoy that WHEREFORE, the impugned judgment of
"primarily close intimacy" which characterizes a respondent Court of Appeals is hereby AFFIRMED
confidential employee. in toto.
3. The position of an ISS member belongs to SO ORDERED.
the bottom level of the salary scale of the
corporation, being in Pay Class 2 level only, Narvasa, C.J., Padilla, Davide, Jr., Romero, Melo,
whereas the highest level is Pay Class 12. Puno, Kapunan, Mendoza, Hermosisima, Jr.,
Panganiban and Torres, Jr., JJ., concur.
Taking into consideration the nature of his
functions, his organizational ranking and his Bellosillo, and Francisco, JJ., on leave.
compensation level, it is obviously beyond debate Vitug, J., see separate opinion.
that private respondent cannot be considered a
Penned by Associate Justice Delilah Vidallon- Tria vs. Sto. Tomas, et al., G.R. No. 85670 July 31,
Magtolis, with Associate Justices Gloria C. Paras 1991, 199 SCRA 833.
and Quirino D. Abad Santos, Jr., concurring: Annex Pamil vs. Teleron, L-34854, November 20, 1978,
A, Petition, Rollo, 26. 86 SCRA 413.
Original Record, 22. Republic of the Philippines
Ibid., 148. SUPREME COURT
Manila
G.R. No. 91602. February 26, 1991. 194 SCRA
548. EN BANC
G.R. No. 93396, September 30, 1991, 202 SCRA
191. G.R. No. 111243 May 25, 1994
Infra, fn. 20. JESUS ARMANDO A.R. TARROSA, petitioner,
This provision reads as follows: "The Civil Service vs.
embraces all branches, subdivisions, GABRIEL C. SINGSON and HON. SALVADOR
instrumentalities and agencies of the M. ENRIQUEZ III, respondents
Government, including government-owned or Marlon B. Llaunder for petitioner.
controlled corporations with original charters."
Sec. 12. Powers and functions. — The Commission
shall have the following powers and functions: QUIASON, J.:
xxx This is a petition for prohibition filed by petitioner
as a "taxpayer," questioning the appointment of
(9) Declare positions in the Civil Service as may respondent Gabriel Singson as Governor of the
be primarily confidential, highly technical or Bangko Sentral Ng Pilipinas for not having been
policy-determining; x x x confirmed by the Commission on Appointments.
Salazar vs. Mathay, Sr., et al., L-44061, The petition seeks to enjoin respondent Singson
September 20, 1976, 73 SCRA 275. from the performance of his functions as such
official until his appointment is confirmed by the
L-22562, October 22, 1966, 18 SCRA 417.
Commission on Appointments and respondent
"No officer or employee of the civil service shall Salvador M. Enriquez, Secretary of Budget and
be removed or suspended except for cause Management, from disbursing public funds in
provided by law" (Sec. 2[3], Art. IX-B, 1987 payment of the salaries and emoluments of
Constitution). respondent Singson.
Approved, October 6, 1975. I
Executive Order No. 292 took effect on November Respondent Singson was appointed Governor of
23, 1989 pursuant to Proclamation No. 495 of the the Bangko Sentral by President Fidel V. Ramos
Office of the President of even date. on July 2, 1993, effective on July 6, 1993 (Rollo, p.
"Appointments in the civil service shall be made 10).
only according to merit and fitness to be Petitioner argues that respondent Singson's
determined as far as practicable, and, except to appointment is null and void since it was not
positions which are policy-determining, primarily submitted for confirmation to the Commission on
confidential, or highly technical by competitive Appointments. The petition is anchored on the
examination." (Sec. 2[2], Art. IX-B, 1987 provisions of Section 6 of R.A. No. 7653, which
Constitution). established the Bangko Sentral as the Central
"The Commission shall have the following powers Monetary Authority of the Philippines. Section 6,
and functions: x x x Declare positions in the Civil Article II of R.A. No. 7653 provides:
Service as may properly be primarily confidential, Sec. 6. Composition of the Monetary Board. The
highly technical or policy-determining." (Sec. powers and functions of the Bangko Sentral shall
12[9] Book V. E.O. No. 292). be exercised by the Bangko Sentral Monetary
Record of the Constitutional Commission, Vol. I, Board, hereafter referred to as the Monetary
571-572. Board, composed of seven (7) members
appointed by the President of the Philippines for a
87 Phil. 289 (1950). term of six (6) years.
Griño, et al. vs. Civil Service Commission, et al., The seven (7) members are:
supra., fn. 4.
(a) The Governor of the Bangko Sentral, who shall
Petition, 12-13, Rollo, 19-20. be the Chairman of the Monetary Board. The
Borres, et al. vs. Court of Appeals, et al., L-36845, Governor of the Bangko Sentral shall be head of a
August 21, 1987, 153 SCRA 120. department and his appointment shall be subject
to confirmation by the Commission on to an office, which must be resolved in a quo
Appointments. Whenever the Governor is unable warranto proceeding, may not be determined in a
to attend a meeting of the Board, he shall suit to restrain the payment of salary to the
designate a Deputy Governor to act as his person holding such office, brought by someone
alternate: Provided, That in such event, the who does not claim to be the one entitled to
Monetary Board shall designate one of its occupy the said office.
members as acting Chairman . . . (Emphasis It is obvious that the instant action was
supplied). improvidently brought by petitioner. To uphold
In their comment, respondents claim that the action would encourage every disgruntled
Congress exceeded its legislative powers in citizen to resort to the courts, thereby causing
requiring the confirmation by the Commission on incalculable mischief and hindrance to the
Appointments of the appointment of the Governor efficient operation of the governmental machinery
of the Bangko Sentral. They contend that an (See Roosevelt v. Draper, 7 Abb. Pr. 108, 23 N.Y.
appointment to the said position is not among the 218).
appointments which have to be confirmed by the Its capstone having been removed, the whole
Commission on Appointments, citing Section 16 of case of petitioner collapses. Hence, there is no
Article VII of the Constitution which provides that: need to resolve the question of whether the
Sec. 16. The President shall nominate and, with disbursement of public funds to pay the salaries
the consent of the Commission on Appointments, and emoluments of respondent Singson can be
appoint the heads of the executive departments, enjoined. Likewise, the Court refrains from
ambassadors, other public ministers and consuls, passing upon the constitutionality of Section 6,
or officers of the armed forces from the rank of R.A. No. 7653 in deference to the principle that
colonel or naval captain, and other officers whose bars a judicial inquiry into a constitutional
appointments are vested in him in this question unless the resolution thereof is
Constitution. He shall also appoint all other indispensable for the determination of the case
officers of the Government whose appointments (Fernandez v. Torres, 215 SCRA 489 [1992]).
are not otherwise provided for by law, and those However for the information of all concerned, we
whom he may be authorized by law to appoint. call attention to our decision in Calderon v.
The Congress may, by law, vest the appointment Carale, 208 SCRA 254 (1992), with Justice Isagani
of other officers lower in rank in the President A. Cruz dissenting, where we ruled that Congress
alone, in the courts, or in the heads of cannot by law expand the confirmation powers of
department, agencies, commissions, or the Commission on Appointments and require
boards . . . (Emphasis supplied). confirmation of appointment of other government
Respondents also aver that the Bangko Sentral officials not expressly mentioned in the first
has its own budget and accordingly, its budgetary sentence of Section 16 of Article VII of the
requirements are not subject to the provisions of Constitution.
the General Appropriations Act. WHEREFORE, the petition is DENIED. No
We dismiss the petition. pronouncement as to costs.
II SO ORDERED.
The instant petition is in the nature of a quo Feliciano, Bidin, Regalado, Davide, Jr., Romero,
warranto proceeding as it seeks the ouster of Bellosillo, Melo, Puno, Vitug and Kapunan, JJ.,
respondent Singson and alleges that the latter is concur.
unlawfully holding or exercising the powers of Narvasa, C.J. and Cruz, JJ., are on leave.
Governor of the Bangko Sentral (Cf. Castro v. Del
Rosario, 19 SCRA 196 [1967]). Such a special civil
action can only be commenced by the Solicitor
General or by a "person claiming to be entitled to
a public office or position unlawfully held or
exercised by another" (Revised Rules of Court, Separate Opinions
Rule 66, Sec. 6; Acosta v. Flor, 5 Phil. 18 [1905]).
PADILLA, J., concurring:
In Sevilla v. Court of Appeals, 209 SCRA 637
I concur in the result. Instead, however, of basing
(1992), we held that the petitioner therein, who
did not aver that he was entitled to the office of the petition's dismissal mainly on technicality, I
would anchor said dismissal squarely on the ruling
the City Engineer of Cabanatuan City, could not
bring the action for quo warranto to oust the laid down by the Court in Calderon vs. Carale, 208
SCRA 254 (1992), to the effect that appointments
respondent from said office as a mere usurper.
by the President of the Philippines, which under
Likewise in Greene v. Knox, 175 N.Y. 432 (1903), the Constitution (Sec. 16, Article VII) are not
67 N.E. 910, it was held that the question of title among those required to be confirmed by the
Commission on Appointments, may not, by respondent Ray Allas was appointed as "Acting
legislation, be made subject to such confirmation. Director III" of the CIIS. Despite petitioner's new
This ruling was a reiteration of the doctrine earlier assignment as Acting District Collector, however,
laid down in Sarmiento vs. Mison, (G.R. No. he continued to receive the salary and benefits of
79974, 156 SCRA 549, December 17, 1987) and the position of Director III.
Bautista vs. Salonga, (G.R. No. 86439, 172 SCRA In September 1994, petitioner received a letter
160, April 13, 1989). from Deputy Customs Commissioner Cesar Z.
Dario, informing him of his termination from the
# Bureau of Customs, in view of respondent Allas'
Separate Opinions
appointment as Director III by President Fidel V.
PADILLA, J., concurring: Ramos. The pertinent portion of the letter reads:
I concur in the result. Instead, however, of basing "Effective March 4, 1994, Mr. Ray Allas was
the petition's dismissal mainly on technicality, I appointed Director III by President Fidel V. Ramos
would anchor said dismissal squarely on the ruling and as a consequence, [petitioner's] services
laid down by the Court in Calderon vs. Carale, 208 were terminated without prejudice to [his] claim
SCRA 254 (1992), to the effect that appointments for all government benefits due [him]."
by the President of the Philippines, which under
Attached to the letter was the appointment of
the Constitution (Sec. 16, Article VII) are not
respondent Ray Allas as "Director III, CIIS, Bureau
among those required to be confirmed by the
of Customs, vice Pedro Mendoza."
Commission on Appointments, may not, by
legislation, be made subject to such confirmation. Petitioner wrote the Customs Commissioner
This ruling was a reiteration of the doctrine earlier demanding his reinstatement with full back wages
laid down in Sarmiento vs. Mison, (G.R. No. and without loss of seniority rights. No reply was
79974, 156 SCRA 549, December 17, 1987) and made.
Bautista vs. Salonga, (G.R. No. 86439, 172 SCRA On December 2, 1994, petitioner filed a petition
160, April 13, 1989). for quo warranto against respondent Allas before
SECOND DIVISION the Regional Trial Court, Paranaque, Branch 258.
The case was tried and on September 11, 1995, a
[G.R. No. 131977. February 4, 1999]
decision was rendered granting the petition. The
PEDRO MENDOZA, petitioner, vs. RAY ALLAS and court found that petitioner was illegally
GODOFREDO OLORES, respondents. terminated from office without due process of law
DECISION and in violation of his security of tenure, and that
as he was deemed not to have vacated his office,
PUNO, J.: the appointment of respondent Allas to the same
Before us, petitioner prays for the execution of office was void ab initio. The court ordered the
the decision of the trial court granting his petition ouster of respondent Allas from the position of
for quo warranto which ordered his reinstatement Director III, and at the same time directed the
as Director III, Customs Intelligence and reinstatement of petitioner to the same position
Investigation Service, and the payment of his with payment of full back salaries and other
back salaries and benefits. benefits appurtenant thereto.
Petitioner Pedro Mendoza joined the Bureau of Respondent Allas appealed to the Court of
Customs in 1972. He held the positions of Port Appeals. On February 8, 1996, while the case was
Security Chief from March 1972 to August 1972, pending before said court, respondent Allas was
Deputy Commissioner of Customs from August promoted by President Ramos to the position of
1972 to September 1975, Acting Commissioner of Deputy Commissioner of Customs for Assessment
Customs from September 1975 to April 1977 and and Operations. As a consequence of this
Customs Operations Chief I from October 1987 to promotion, petitioner moved to dismiss
February 1988. On March 1, 1988, he was respondent's appeal as having been rendered
appointed Customs Service Chief of the Customs moot and academic. The Court of Appeals
Intelligence and Investigation Service (CIIS). In granted the motion and dismissed the case
1989, the position of Customs Service Chief was accordingly. The order of dismissal became final
reclassified by the Civil Service as "Director III" in and entry of judgment was made on March 19,
accordance with Republic Act No. 6758 and 1996.
National Compensation Circular No. 50. On May 9, 1996, petitioner filed with the court a
Petitioner's position was thus categorized as quo a Motion for Execution of its decision. On July
"Director III, CIIS" and he discharged the function 24, 1996, the court denied the motion on the
and duties of said office. ground that the contested position vacated by
On April 22, 1993, petitioner was temporarily respondent Allas was now being occupied by
designated as Acting District Collector, Collection respondent Godofredo Olores who was not a party
District X, Cagayan de Oro City. In his place, to the quo warranto petition.
Petitioner filed a special civil action for certiorari If it is found that the respondent or defendant is
and mandamus with the Court of Appeals usurping or intruding into the office, or unlawfully
questioning the order of the trial court. On holding the same, the court may order:
November 27, 1997, the Court of Appeals (1) The ouster and exclusion of the defendant
dismissed the petition. Hence, this recourse. from office;
Petitioner claims that: (2) The recovery of costs by plaintiff or relator;
"The Court of Appeals grossly erred in holding (3) The determination of the respective rights in
that a writ of execution may no longer be issued, and to the office, position, right, privilege or
considering that respondent Olores who was not a franchise of all the parties to the action as justice
party to the case now occupies the subject requires.
position."
The character of the judgment to be rendered in
The instant petition arose from a special civil quo warranto rests to some extent in the
action for quo warranto under Rule 66 of the discretion of the court and on the relief sought. In
Revised Rules of Court. Quo warranto is a the case at bar, petitioner prayed for the following
demand made by the state upon some individual relief:
or corporation to show by what right they exercise
some franchise or privilege appertaining to the "WHEREFORE, it is respectfully prayed that
state which, according to the Constitution and respondent be ousted and altogether excluded
laws of the land, they cannot legally exercise from the position of Director III, Customs
except by virtue of a grant or authority from the Intelligence and Investigation Service of the
state. In other words, a petition for quo warranto Bureau of Customs, and petitioner be seated to
is a proceeding to determine the right of a person the position as the one legally appointed and
to the use or exercise of a franchise or office and entitled thereto.
to oust the holder from its enjoyment, if his claim Other reliefs, just or equitable in the premises, are
is not well-founded, or if he has forfeited his right likewise prayed for."
to enjoy the privilege. The action may be
commenced for the Government by the Solicitor In granting the petition, the trial court ordered
General or the fiscal against individuals who usurp that:
a public office, against a public officer whose acts "WHEREFORE, viewed in the light of the foregoing,
constitute a ground for the forfeiture of his office, judgment is hereby rendered granting this
and against an association which acts as a petition for quo warranto by:
corporation without being legally incorporated.
The action may also be instituted by an individual 1. Ousting and excluding respondent Ray Allas
from the position of Director III, Customs
in his own name who claims to be entitled to the
public office or position usurped or unlawfully held Intelligence and Investigation Service of the
Bureau of Customs; and
or exercised by another.
Where the action is filed by a private person, he 2. Reinstating petitioner Pedro C. Mendoza, Jr. to
the position of Director III, Customs Intelligence
must prove that he is entitled to the controverted
position, otherwise respondent has a right to the and Investigation Service of the Bureau of
Customs with full back wages and other monetary
undisturbed possession of the office. If the court
finds for the respondent, the judgment should benefits appurtenant thereto from the time they
were withheld until reinstated."
simply state that the respondent is entitled to the
office. If, however, the court finds for the The trial court found that respondent Allas
petitioner and declares the respondent guilty of usurped the position of "Director III, Chief of the
usurping, intruding into, or unlawfully holding or Customs Intelligence and Investigation Service."
exercising the office, judgment may be rendered Consequently, the court ordered that respondent
as follows: Allas be ousted from the contested position and
that petitioner be reinstated in his stead.
"Sec. 10. Judgment where usurpation found.--
When the defendant is found guilty of usurping, Although petitioner did not specifically pray for his
back salaries, the court ordered that he be paid
intruding into, or unlawfully holding or exercising
an office, position, right, privilege, or franchise, his "full back wages and other monetary benefits"
appurtenant to the contested position "from the
judgment shall be rendered that such defendant
be ousted and altogether excluded therefrom, and time they were withheld until reinstated."
that the plaintiff or relator, as the case may be, The decision of the trial court had long become
recover his costs. Such further judgment may be final and executory, and petitioner prays for its
rendered determining the respective rights in and execution. He alleges that he should have been
to the office, position, right, privilege, or franchise reinstated despite respondent Olores'
of all the parties to the action as justice requires." appointment because the subject position was
never vacant to begin with. Petitioner's removal
was illegal and he was deemed never to have
vacated his office when respondent Allas was Quirino Abad Santos, Jr., J., ponente with Ruben
appointed to the same. Respondent Allas' Reyes and Hilarion Aquino, JJ., concurring.
appointment was null and void and this nullity Petition, p. 7, Rollo, p. 27.
allegedly extends to respondent Olores, his
successor-in-interest. Francisco, V., The Revised Rules of Court in the
Philippines, vol. IV-B, Part I, p. 281 [1972] citing
Ordinarily, a judgment against a public officer in 44 Am Jur 88-89; see also Sections 1 to 5, Rule 66,
regard to a public right binds his successor in Revised Rules of Court.
office. This rule, however, is not applicable in quo
warranto cases. A judgment in quo warranto does Castro v. del Rosario, 19 SCRA 196, 200 [1967].
not bind the respondent's successor in office, Referred to as public prosecutor under the 1997
even though such successor may trace his title to Rules of Civil Procedure.
the same source. This follows from the nature of
the writ of quo warranto itself. It is never directed Sections 1 to 4, Rule 66, Revised Rules of Court;
to an officer as such, but always against the see also Sections 1 to 3, Rule 66, 1997 Rules of
person-- to determine whether he is Civil Procedure.
constitutionally and legally authorized to perform Section 6, Rule 66, Revised Rules of Court; see
any act in, or exercise any function of the office to also Section 5, Rule 66, 1997 Rules.
which he lays claim. In the case at bar, the
petition for quo warranto was filed by petitioner Castro v. del Rosario, 19 SCRA 196, 201 [1967];
Caraan-Medina v. Quizon, 18 SCRA 562, 569
solely against respondent Allas. What was
threshed out before the trial court was the [1966]; Austria v. Amante, 79 Phil. 780, 783
[1948].
qualification and right of petitioner to the
contested position as against respondent Ray Francisco, supra, at 334.
Allas, not against Godofredo Olores. The Court of Martin, Rules of Court in the Philippines, vol. III, p.
Appeals did not err in denying execution of the
268 [1986].
trial court's decision.
Martin, Rules of Court in the Philippines, vol. III, p.
Petitioner has apprised this Court that he reached
268 [1986].
the compulsory retirement age of sixty-five (65)
years on November 13, 1997. Reinstatement not Petition, p. 4, Annex "C" to the CA Petition, CA
being possible, petitioner now prays for the Rollo, p. 43.
payment of his back salaries and other benefits Decision, pp. 14-15, Rollo, pp. 66-67.
from the time he was illegally dismissed until
finality of the trial court's decision. Petition, pp. 10-14, Rollo, pp. 29-33.
Respondent Allas cannot be held personally liable Francisco, supra, at 339-340, citing 44 Am. Jur
for petitioner's back salaries and benefits. He was 181-182.
merely appointed to the subject position by the Id.
President of the Philippines in the exercise of his
constitutional power as Chief Executive. Neither Petition, pp. 14-15, Rollo, pp. 33-34.
can the Bureau of Customs be compelled to pay Angara v. Gorospe, 101 Phil. 79, 92 [1957].
the said back salaries and benefits of petitioner.
Top of Form
The Bureau of Customs was not a party to the
petition for quo warranto. Search

IN VIEW WHEREOF, the petition is denied and


the decision of the Court of Appeals in CA-G.R. SP Bottom of Form
No. 41801 is affirmed.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Quisumbing, and Republic of the Philippines
Buena, JJ., concur. SUPREME COURT
Manila
Regional Trial Court, Paranaque, Branch 258,
presided by Judge Raul E. de Leon. EN BANC

Petition, p. 3, Rollo, p. 23.


Civil Case No. 94-3078. G.R. No. 104226 August 12, 1993

CA Rollo, p. 83. CONCHITA ROMUALDEZ-YAP, petitioner,


vs.
Rollo, pp. 42-45. THE CIVIL SERVICE COMMISSION and THE
CA-G.R. SP No. 41801. PHILIPPINE NATIONAL BANK, respondents.
Estelito P. Mendoza for petitioner.
The Solicitor General for the Civil Service received by petitioner only on 26 February 1990)
Commission. stating thus:
Domingo A. Santiago, Jr. for Philippine National xxx xxx xxx
Bank. It may be mentioned in this connection, that
inasmuch as you did not avail of the
ERIP/Supplementary Retirement Plans adopted by
PADILLA, J.:
the PNB in 1986, you have therefore lost your
This is a special civil action for certiorari under right thereto. Moreover, since you lack the
Rule 65 of the Rules of Court, assailing Resolution required number of years of service to entitle you
No. 92-201 of the respondent Civil Service to retirement benefits under existing laws, you
Commission, which upheld the petitioner's may be entitled to the return of your GSIS
separation from the Philippine National Bank(PNB) personal contributions. Considering further that
as a result of the abolition of the Fund Transfer you have exhausted all your accumulated leave
Department pursuant to a reorganization under credits as you went on leave of absence for the
Executive Order No. 80, dated 3 December 1986. period from April 1, 1986 to February 20, 1987,
Petitioner Conchita Romualdez-Yap started there is no legal or valid basis to entitle you to
working with the Philippine National Bank on 20 payment of terminal leave.
September 1972 as special assistant with the rank Finally, pursuant to Section 16, Article XVIII of the
of Second Assistant Manager assigned to the Transitory Provisions of the 1987 Philippine
office of the PNB President. After several Constitution, you may be entitled to payment of
promotions, she was appointed in 1983 Senior separation subject to auditing rules and
Vice President assigned to the Fund Transfer regulations. 2
Department.
In her motion for reconsideration with the Civil
Starting 1 April 1986 up to 20 February 1987, Service Commission, dated 5 March 1990,
petitioner filed several applications for leave of questioning Chairman Barlongay's ruling,
absence (due to medical reasons) which were petitioner claimed:
duly approved. While she was on leave, Executive
1. The opinion/ruling was not fully supported by
Order No. 80 (Revised Charter of the PNB) was
the evidence on record;
approved on 3 December 1986. Said executive
order authorized the restructure/reorganization 2. Errors of law prejudicial to the interest of the
and rehabilitation of PNB. Pursuant to the movant have been committed. She argued:
reorganization plan, the Fund Transfer . . . that her separation from the service was
Department was abolished and its functions illegal and was done in bad faith considering that
transferred to the International Department. her termination on February 16, 1986 was made
Consequently, petitioner was notified of her effective prior to the effectivity of Executive Order
separation from the service in a letter dated 30 No. 80 on December 3, 1986, which law
January 1987, thus: authorized the reorganization of the PNB, and
even before February 25, 1986, when President
Pursuant to the Transitory Provision of the 1986
Corazon C. Aquino came into power. She further
Revised Charter of the Bank, please be informed
claims that although the notice of termination was
that Management has approved your separation
dated January 30, 1987 it was only served upon
from the service effective February 16, 1986. You
her on February 16, 1987 when the new
shall be entitled to the regular benefits allowed
Constitution which guarantees security of tenure
under existing law. (emphasis supplied)
to public employees was already in effect. 3
Please be informed further that under Sec. 37 of
xxx xxx xxx
the Bank's 1986 Revised Charter, any officer or
employee who feels aggrieved by any matter . . . the bad faith in her separation from the
treated above may submit his case to the Civil service in 1987 was evident from the recent
Service restoration of the Fund Transfer Department as a
Commission. 1 separate and distinct unit from the International
Department . . . 4
This letter was received by petitioner's secretary
at the PNB head office on 16 February 1987. Denying the motion for reconsideration, the Civil
Service Commission in its aforecited Resolution
Petitioner's first recorded appeal to the Civil
No. 92-201, dated 30 January, 1992, ruled:
Service Commission questioning her separation is
a letter dated 4 August 1989. Then CSC Chairman Sec. 33 of EO 80 (1986 Revised Charter of the
Samilo N. Barlongay upheld the validity of her PNB) provides:
separation from the service in a letter/opinion Sec. 33. Authority to Reorganize. — In view of
dated 30 August 1989 (this was allegedly reduced operations contemplated under this
charter in pursuance of the national policy
expressed in the "Whereas" clause hereof, a substantiate her claim by clear and convincing
reorganization of the Bank and a reduction in evidence that the abolition of her position was a
force are hereby authorized to achieve greater result of her close identification with the previous
efficiency and economy in operations, including regime, being a sister of former First Lady Imelda
the adoption of a new staffing pattern to suit the Romualdez Marcos. This being so, and pursuant to
reduced operations envisioned. The program of the presumption of regularity in the performance
reorganization shall begin immediately after the of official functions, the abolition of movant Yap's
approval of this Order, and shall be completed position should be upheld. PNB, in the instant
within six (6) months and shall be fully case, has clearly proved by substantial evidence
implemented within eighteen (18) months that its act in terminating the services of some of
thereafter." Clearly; as aforequoted, PNB was its employees was done in good faith. 5
authorized to undergo reorganization and to Overruling her imputation of bad faith, i.e. her
effect a reduction in force to "achieve greater separation was illegal because it took effect on 16
efficiency and economy in operations". It cannot, February 1986 or even before the promulgation of
be disputed that reduction in force necessitates, EO No. 80 on 3 December 1986, the CSC noted
among others, the abolition of positions/offices. that the year "1986" stated in the notice of her
The records show that prior to its reorganization, separation from the service was a typographical
PNB originally had 7,537 positions which were error. PNB submitted documents (p. 6 of
reduced to 5,405 after the reorganization. Indeed, Resolution No. 92-201) supporting its stand that
2,132 positions were abolished, that is, the the separation actually took effect on 16 February
original positions in PNB were reduced by 28%.
1987.
This reduction in force likewise included the
senior officer positions, in PNB, which were On the issue of bad faith as related to the later
reduced, thus: restoration of the Fund Transfer Department, the
subject CSC resolution adds:
Positions Incumbents Proposed Position
xxx xxx xxx
President 1 1 1
Sr. Exec. VP 1 1 0 It may be mentioned that the recent restoration of
Exec. VP 3 2 2 the Fund Transfer Department, actually was a
Senior VP 12 11 7 merger of the Fund Transfer Group, the Foreign
Vice Pres. 33 27 15 Remittance Development and Coordinating Unit
based on board Resolution No. 60 of March 12,
The position of movant Yap (SVP) was one among 1991, or after the lapse of over four (4) years
the original twelve (12) SVP positions. It was one from the date it was abolished in 1987. Moreover,
among the five (5) SVP positions which were the restoration of the Fund Transfer Department
abolished. In fact, the FTD of which she was then and other offices in the PNB was primarily caused
the incumbent SVP, was merged with the by the improved financial capability and present
International Department to which its functions needs of the Bank. This improved financial
were closedly related. condition of the PNB is evident from the 1990
It should be noted that as ruled by the Supreme Annual Report it submitted. It may be further
Court in Dario vs. Mison (G.R. NO. 81954): stated that the re-established FTD is headed by a
Vice President, a position much lower in rank than
Reorganizations in this jurisdiction have been
the former department headed by a Senior Vice
regarded as valid provided they are pursued in
President.
good faith. As a general rule, a reorganization is
carried out in "good faith" if it is for the purpose of Furthermore, it should be noted that granting
economy or to make bureaucracy more efficient. arguendo that movant Yap's termination from the
In that event, no dismissal or separation actually service was tainted with bad faith, she however, is
occurs because the position itself ceases to exist. now barred from assailing the same as she did not
And in that case, security of tenure would not be a seasonably assert her right thereto. Records show
Chinese Wall. . . . . that she was separated from PNB on February 16,
1987 and it was only in 1989 or about 2 years
. . . Good faith, as a component of a
thereafter when she brought this matter to this
reorganization under a constitutional regime is
Commission. By her inaction in questioning her
judged from the facts of each case.
termination within a period of one year, she is
In the instant case, therefore, this Commission is considered to have acquiesced to her separation
inclined to believe that the reorganization of PNB from the service and abandoned her right to the
was done in good faith. For indeed, the position. 6
reorganization was pursued to achieve economy.
In the present petition before the Court, the
It undertook reduction in force as a means to
following issues are raised:
streamline the numbers of the workforce. It was
incidental that movant Yap's position was one
among those abolished. Movant Yap failed to
1. Existence of bad faith in the reorganization of (d) Employees holding permanent appointments:
the Philippine National Bank resulting in the Provided, That those in the same category as
separation from the service of petitioner. enumerated above, who are least qualified in
terms of performance and merit shall be laid off
2. Erroneous application of the Dario v. Mison
first, length of service notwithstanding.
doctrine vis-a-vis PNB's reorganization.
3. Petitioner was not extended preference in
3. Erroneous application of the one (1) year
appointment to the positions in the new staffing
prescriptive period for quo warranto proceedings
pattern as mandated by Sec. 4 of Rep. Act 6656,
in petitioner's case.
her qualification and fitness for new positions
Dario v. Mison 7 laid down the requirement of were never evaluated or considered in violation of
good faith in the reorganization of a government Sec. 27 of P.D. 807 which was incorporated as
bureau wherein offices are abolished. It says: Sec. 29 Ch. 5 Subtitle A, Book V of the
. . . Reorganizations in this jurisdiction have been Administrative Code of 1987.
regarded as valid provided they are pursued in 4. Lack of notice and bearing before separation
good faith. As a general rule, a reorganization is from the service.
carried out in "good faith" if it is for the purpose of
5. Petitioner was forced to take a leave of
economy or to make bureaucracy more efficient.
absence and prevented from reporting for work.
In that event, no dismissal (in case of dismissal)
or separation actually occurs because the position 6. There is a discrepancy in the date of her
itself ceases to exist. And in that case, security of separation from the service and the effectivity
tenure would not be a Chinese wall. Be that as it thereof.
may, if the "abolition," which is nothing else but a 7. PNB employees in the Fund Transfer
separation or removal, is done for political Department identified with her were reassigned or
reasons or purposely to defeat security of tenure, frozen.
or otherwise not in good faith, no valid "abolition"
takes place and whatever "abolition" is done, is 8. She is listed as having resigned instead of
void ab initio. There is an invalid "abolition" as being separated or dismissed which was what
where there is merely a change of nomenclature actually happened.
of positions, or where claims of economy are 9. The dismissal was politically motivated, she
belied by the existence of ample funds. It is to be being a sister of Mrs. Imelda Romualdez Marcos,
stressed that by predisposing a reorganization to wife of deposed President Ferdinand Marcos.
the yardstick of good faith, we are not, as a
consequence, imposing a "cause" for Executive Order No. 80 conferred upon the PNB
restructuring. Retrenchment in the course of a the authority to reorganize. The order was issued
reorganization in good faith is still removal "not by then Pres. Corazon Aquino on 3 December
for cause" if by "cause" we refer to "grounds" or 1986 while she was exercising the powers vested
conditions that call for disciplinary action. Good in the President of the Philippines by the Freedom
faith, as a component of a reorganization under a Constitution. After 3 December 1986, what
constitutional regime, is judged from the facts of remained to be done was the implementation of
each case. the reorganization. There is no doubt as to the
legal basis for PNB's reorganization. The real
In Petitioner's case, the following instances are question is: was it done in good faith, tested by
cited by her as indicia of bad faith: the Dario v. Mison doctrine?
1. The abolished department was later restored To start with it is almost absurd for petitioner to
and the number of senior vice presidents was insist that her termination from the service was
increased. antedated to 16 February 1986. At that time, the
2. PNB did not follow the prescribed sequence of reorganization of PNB had not even been
separation of employees from the service conceived. In most of PNB's pleadings, it has
contained in Rep. Act No. 6656 which is: documented and supported its stand that the year
of petitioner's separation is 1987 not 1986. The
Sec. 3. In the separation of personnel pursuant to antedating of the termination date, aside from
reorganization, the following order of removal being clearly a typographical error, is a
shall be followed: periphernal issue. The real issue is existence of
(a) Casual employees with less than five (5) years bad faith consisting of tangible
of government service; bureaucratic/management pressures exerted to
ease her out of office. Bad faith has been defined
(b) Casual employees with five (5) years or more
as a state of mind affirmatively operating with
of government service;
furtive design or with some motive of self interest
(c) Employees holding temporary appointments; or ill will or for an ulterior purpose. 8 It is the
and performance of an act with the knowledge that
the actor is violating the fundamental law or right,
even without willful intent to injure or purposive connection, the philosophy behind PNB's
malice to perpetrate a damnifying harm. 9 reorganization is spelled out in the whereas
clauses of Executive Order No. 80:
PNB's reorganization, to repeat, was by virtue of a
valid law. At the time of reorganization, due to the WHEREAS, within the context of the general policy
critical financial situation of the bank, there nevertheless exists a clear role for direct
departments, positions and functions were government-participation in the banking system,
abolished or merged. The abolition of the Fund particularly in servicing the requirements of
Transfer Department (FTD) was deemed agriculture, small and medium scale industry,
necessary. This, to the Court's mind, was a export development, and the government sector.
management prerogative exercised pursuant to a WHEREAS, in pursuit of this national policy there
business judgment. At this point, a distinction can is need to restructure the government financial
be made in ruling on the validity of a institutions, particularly the Philippine National
reorganization between a government bureau or Bank, to achieve a more efficient and effective
office performing constituent functions (like the use of available scarce resources, to improve its
Customs) and a government-owned or controlled viability, and to avoid unfair competition with the
corporation performing ministrant functions (like private sector, and
the PNB).
WHEREAS, the reorganization and rehabilitation of
Constituent function are those which constitute the Philippine National Bank into a similar but
the very bonds of society and are compulsory in stronger and more operationally viable bank is an
nature; ministrant functions are those undertaken important component of the nationalization
by way of advancing the general interests of programs for both the financial system and the
society, and are merely optional. Commercial or government corporation sector; . . . .
universal banking is, ideally, not a governmental
but a private sector, endeavor. It is an optional Whether there was a hidden political agenda to
function of government. persecute petitioner due to her consanguinial
relation to Mrs. Imelda Romualdez Marcos, the
. . . The principles determining whether or not a widow of former President Marcos, is not clearly
government shall exercise certain of these shown. On the other hand, it is entirely possible
optional functions are: (1) that a government that, precisely because of such consanguinial
should do for the public welfare those things relation, petitioner may have been the object of
which private capital would not naturally deferential, if not special treatment under the
undertake and (2) that a government should do Marcos regime. It is part of the Filipino culture to
those things which by its very, nature it is better extend such deferential, if not special treatment
equipped to administer for the public welfare than to close relatives of persons in power. Many times
is any private individual or group of individuals this is carried to unwholesome extremes. But a
(Malcolm, The Government of the Philippine discontinuance of such deferential or special
Islands, pp. 19-20) treatment in the wake of a change in government
From the above we may infer that, strictly or administration is not bad faith per se. It may be
speaking, there are functions which our merely putting things in their proper places.
government is required to exercise to promote its Due to the restructuring — and this is empirically
objectives as expressed in our Constitution and verifiable — PNB became once more a viable
which are exercised by it as an attribute of banking institution. The restoration of the FTD
sovereignty, and those which it may exercise to four years after it was abolished and its functions
promote merely the welfare, progress and transferred to the International Department, can
prosperity of the people. To this latter class be attributed to the bank's growth after
belongs the organization of those corporations reorganizations, thereby negating malice or bad
owned or controlled by the government to faith in that reorganization. The essence of good
promote certain aspects of the economic life of faith lies in an honest belief in the validity of one's
our people such as the National Coconut right. 10 It consists of an honest intention to
Corporation. These are what we call government- abstain from taking an unconscionable and
owned or controlled corporations which may take unscrupulous advantage of another, its absence
on the form of a private enterprise or one should be established by convincing evidence. 11
organized with powers and formal characteristics
of a private corporation under the Corporation The records also clearly indicate that starting April
Law. (Bacani vs. Nacoco, No, L-9657, November 1986 to February 1987, petitioner went on leave
29, 1956, 100 Phil. 468) of absence for medical reasons. While she was not
reporting to the office, the bank's reorganization
But a reorganization whether in a government got underway. She continued, however, receiving
bureau performing constituent functions or in a her salaries, allowances, emoluments, honoraria
government-owned or controlled corporation and fees up to March 1987. Employees who were
performing ministrant functions must meet a affected by the reorganization had the option to
common test, the test of good faith. In this
avail of the bank's Separation Benefits Plan/Early (b) Where an office is abolished and another
Retirement Plan (SBP/ERIP). Petitioner opted not performing substantially the same functions is
to avail of such plan and instead submitted to the created;
result of the bank's ongoing reorganization and (c) Where incumbents are replaced by those less
management's discretion. If petitioner had the qualified in terms of status of appointment,
desire for continued employment with the bank, performance and merit;
she could have asserted it for management's
consideration. There is no proof on record that (d) Where there is a reclassification of offices in
she affirmatively expressed willingness to be the department or agency concerned and the
employed. Since she cannot rebut the CSC finding reclassified offices perform substantially the same
that her earliest appeal was made on 4 August functions as the original offices;
1989, there is no reason for this Court to hold that (e) Where the removal violates the order of
she did not sleep on her rights. On the contrary, separation provided in Section 3 hereof.
her present argument that bad faith existed at the
time of the abolition of the FTD because it was xxx xxx xxx
restored four years later is a little too late. Who Sec. 4. Officers and employees holding
could have predicted in 1986 or 1987 that PNB permanent, appointments shall be given
would be able to rise from its financial crisis and preference for appointment to the new position in
become a viable commercial bank again? The the approved staffing pattern comparable to their
decision to abolish the FTD at the time it was former positions or in case there are not enough
abolished, to repeat, was a business judgment comparable positions, to positions next lower in
made in good faith. rank.
PNB for its part submits that its reorganization No new employees shall be taken in until all
was effected in good faith permanent officers and employees have been
because — appointed, including temporary and casual
a) There was not only a perceptible but employees who possess the necessary
substantial restructuring of the PNB hierarchy qualification requirements, among which is the
showing reduction of personnel, consolidation of appropriate civil service eligibility, for permanent
offices and abolition of positions. appointment to positions in the approved staffing
pattern, in case there are still positions to be
b) Two thousand one hundred thirty two (2,132) filled, unless such positions are policy-
positions were abolished during the period from determining, primarily confidential or highly
February 16, 1986 to January 14, 1987 leaving a technical in nature.
lean workforce of five thousand four hundred five
(5,405) as of latter date per B.R. No. 34 hereto In the first place, Rep. Act No. 6656 cannot be
attached as Annex "R". invoked by petitioner because it took effect on 15
June 1987, or after PNB's reorganization had
c) The number of senior officers, including Senior already been implemented. But assuming, ex
Vice Presidents, was accordingly reduced. gratia argumenti, that it is applicable here and
Another issue raised by petitioner is PNB's alleged petitioner must be accorded preferential right to
non-compliance with the mandate of Sections 2 appointment in the bank, PNB in its rejoinder
and 4 of Rep. Act No. 6656. These Sections impressively asserts:
provide: Needless to say, there were various committees
Sec. 2. No officer or employee in the career that were created in the implementation of the
service shall be removed except for a valid cause organizational restructuring of the Bank based on
and after due notice and hearing. A valid cause the foregoing policy guidelines. Each personnel to
for removal exists when, pursuant to a bona fide be retained was evaluated in terms of relative
reorganization, a position has been abolished or fitness and merit along with the other personnel
rendered redundant or there is a need to merge, of the Bank. Thus, when then SVP Federico
divide, or consolidate positions in order to meet Pascual was chosen to head the International
the exigencies of the service, or other lawful Department from among other officers of the
causes allowed by the Civil Service Law. The Bank, including Ms. Yap, his qualifications far
existence of any or some of the following exceeded those of the other candidates for the
circumstances may be considered as evidence of position.
bad faith in the removals made as a result of We attach hereto as Annexes "G-1" and "G-2" the
reorganization, giving to a claim for reinstatement service records of Mr. Federico Pascual and
or reappointment by an aggrieved party. Petitioner Ms. Yap, respectively, which clearly
(a) Where there is a significant increase in the show that the qualifications of Mr. Pascual far
number of positions in the new staffing pattern of exceed those of Petitioner Yap. Aside from being a
the department or agency concerned; lawyer having been a law graduate from the
University of the Philippines, he is also a Bachelor
of Arts degree holder from Ateneo de Manila and years in accordance with Article 1146 of the Civil
a Master of Laws graduate o Columbia Law Code. 20 We do not agree. Petitioner's separation
School. He had studied Masteral Arts in Public from the service was due to the abolition of her
Administration at the London School of Economics office in implementation of a valid reorganization.
and had undergone extensive seminars since This is not the unjustifiable cause which results in
1974 at the International Department and had injury to the rights of a person contemplated by
been assigned in several foreign branches of the Article 1146. The abolition of the office was not a
Bank. Before he resigned from the Bank, he held whimsical, thoughtless move. It was a thoroughly
the second highest position of Executive Vice evaluated action for streamlining functions based
President and served as Acting President of the on a rehabilitation plan. 21 At the time of the
Bank before the incumbent president, President abolition of the Fund Transfer Department in
Gabriel Singson assumed his position. 1986, foreign exchange losses of the bank
amounted to P81.1 Million. 22 The head of office
On the other hand, the service record of Petitioner
was a Senior Vice President. At the time of
Yap will show that she only holds a Bachelor of
restoration of the department in 1991, it was
Science in Commerce Degree from Assumption
headed by a vice president (lower in rank) and
Convent and has undergone only one seminar on
showed earnings of P2,620.0 Million. 23 Other
Management and Leadersbip Training Program.
departments abolished in 1986 were also
She entered the Bank service in 1972. (Rollo at
subsequently restored.
pp. 312 to 313)
Restoring petitioner to her previous position with
xxx xxx xxx
backwages would be unjust enrichment to her,
The prayer in the petition at bar seeks petitioner's considering that she had abandoned or showed
immediate reinstatement to her former position lack of interest in reclaiming the same position
as senior vice president and head of the Fund when the bank was not yet fully rehabilitated and
Transfer Department, or reappointment to a she only insisted on reinstatement in August 1989
position of comparable or equivalent rank without or two (2) years after her alleged unjustified
loss of seniority rights and pay, etc., under the separation.
bank's new staffing pattern.
To those who feel that their unjustified separation
A person claiming to be entitled to a public office from the service is for a cause beyond their
or position usurped or unlawfully held or control, the aforecited Magno case teaches:
exercised by another may bring an action for quo
. . . while We fully recognize the special protection
warranto (Rule 66, Sec. 6, Rules of Court). The
which the Constitution, labor laws, and social
petitioner therein must show a clear legal right to
legislation accord the workingman, We cannot,
the office allegedly held unlawfully by another. 12
however, alter or amend the law on prescription
An action for quo warranto should be brought to relieve him of the consequences of his inaction.
within one (1) year after ouster from office; 13 the Vigilantibus, non dormientibus, jura subveniunt
failure to institute the same within the (Laws come to the assistance of the vigilant, not
reglementary period constitutes more than a of the sleeping). His explanation that he could not
sufficient basis for its dismissal 14 since it is not have filed the complaint earlier because "he was
proper that the title to a public office be subjected prevented to do so beyond his control for the
to continued simple reason that private respondent have (sic)
uncertainty . . . 15 An exception to this prescriptive tried to circumvent the law by merely floating"
period lies only if the failure to file the action can him is very flimsy and does not even evoke
be attributed to the acts of a responsible sympathetic consideration, if at all it is proper and
government officer and not of the dismissed necessary. We note that petitioner herein is not
employee. 16 an unlettered man; he seems to be educated and
Measured by the above jurisprudence, petitioner's assertive of his rights and appears to be familiar
action may be said to be one for quo warranto, with judicial procedures. He filed a motion for
seeking reinstatement to her former position extension of time to file the petition and the
which at present is occupied by another. She petition itself without the assistance of counsel.
cannot invoke De Tavera v. Phil. Tuberculosis We cannot believe that if indeed he had a valid
Society, Inc., et. al. 17 and contend that there is no grievance against PNCC he would not have taken
claim of usurpation of office, and that quo immediate positive steps for its redress.
warranto may be availed of to assert one's right WHEREFORE, premises considered, the assailed
to an office in the situation obtaining in the case CSC resolution is AFFIRMED. The petition is
at bar. DISMISSED for failure to show grave abuse of
Santos v. CA, et. al. 18 and Magno v. PNNC Corp. 19 discretion on the part of said CSC in rendering the
are invoked by petitioner to illustrate that this questioned resolution. No pronouncement as to
action is one for separation without just cause, costs.
hence, the prescriptive period is allegedly four (4) SO ORDERED.
Narvasa, C.J., Cruz, Feliciano, Bidin, Griño-Aquino, RAMADA, DOMINGO COTIAMCO, BWD Board of
Regalado, Davide, Jr., Romero, Nocon, Bellosillo, Directors, and other similarly situated Officers and
Melo, Quiason, Puno and Vitug, JJ., concur. Board Members of BWD, petitioners, vs.
COMMISSION ON AUDIT, respondent.
DECISION
# Footnotes
MENDOZA, J.:
1 Rollo, p. 12.
This is a special civil action for certiorari under
2 Rollo, pp. 43-44.
Rule 64 of the 1997 Revised Rules of Court for
3 Resolution No. 92-201, CSC, Rollo, p. 31. annulment of the decision, dated September 21,
4 Ibid., p. 32. 2000, of the Commission on Audit and its
resolution, dated January 30, 2001, affirming the
5 Ibid., pp. 33-34. disallowance by the Director, COA Regional Office
6 Rollo at p. 36. No. VIII, of the payment of various benefits to
members of the board of directors and officers of
7 G.R. No. 81954, August 8, 1989, 176 SCRA 92- petitioner Baybay Water District (BWD) in Baybay,
93. Leyte.
8 Air France v. Carrascoso L-21438, September The facts are as follows:
28, 1966, 18 SCRA 166.
In 1996, the Resident Auditor of the BWD
9 De Castro v. Carranza, 50460-R, July 3, 1974, conducted an audit of its 1994 accounts. In the
see Moreno, F.B., Philippine Law Dictionary, Third course of the audit, the auditor disallowed
Edition. payments of per diems in excess of those
10 Bernardo vs. Bernardo, 96 Phil., 205. authorized by the Local Water Utilities
Administration (LWUA) and P. D. No. 198, RATA
11 Hilario vs. Galvez, 45494-R, August 19, 1971.
(representation and transportation allowance) and
12 Carillo vs. CA, G.R. No. L-24554, May 31, 1967, rice allowances granted to the members of the
77 SCRA 170. board of directors of the BWD, as well as
13 Cornejo vs. Secretary of Justice, G.R. No. L- duplication of claims for cash gifts as part of the
32818, June 28, 1974, 57 SCRA 663. Christmas bonus of the general manager and
traveling allowance of the officers of the BWD.
14 Alejo vs. Marquez, G.R. No. L-29053, February The members of the board, namely, petitioners
27, 1971, 37 SCRA 762. Domingo V. Cotiamco, Apolonio G. Medina, Nilo T.
15 Villegas vs. de la Cruz, G.R. No. L-23752, Ramada, Virginia P. Espinosa, Ernesto L. Gorre,
December 31, 1965, 15 SCRA 720. Antonio R. C. Palencia, Love Joy A. Fernandez, and
Frank Bula, Administrative Division Chief Erlinda
16 Cristobal vs. Melchor, G.R. No. L-43203, July A. Mendez, and then General Manager Francis H.
29, 1977, 75 SCRA 175. P. Militante, the officers who had approved the
17 G.R. No. L-48928, February 25, 1982, 112 release of these benefits, were served with
SCRA 243. notices of disallowance. Ma. Josette B. Astorga, to
whom rice allowances had been given, and the
18 G.R. No. L-47750, February 29, 1980, 96 SCRA
other petitioners in this case were also served
448.
with similar notices.
19 G.R. No. L-87320, June 6, 1991, 198 SCRA 230.
On May 30, 1997, petitioners asked for a
20 Article 1146, Civil Code, provides: reconsideration, but the Resident Auditor denied
Art 1146. The following actions must be instituted their request on the ground that the disallowance
within four years: had become final and executory. Instead, she
advised them to make their appeal to the
1. Upon an injury to the rights of the plaintiff; Commission on Audit. The BWD at first appealed
2. Upon a quasi-delict." to the COA Regional Office No. VIII at Tacloban
City, which affirmed the findings of the Resident
21 Annex F-2, Rollo at 336. Auditor of Baybay, Leyte, and then to the
22 PNB's Rejoinder, p. 29, Rollo at 293. Commission on Audit. On September 21, 2000,
the Commission rendered a decision, the
23 Ibid., p. 294.
dispositive portion of which reads:
EN BANC
WHEREFORE, premises considered, it is regretted
[G.R. Nos. 147248-49. January 23, 2002] that the instant appeal cannot be given due
BAYBAY WATER DISTRICT, represented by course for lack of merit. Accordingly, the
ERNESTO D. FERNANDEZ, General Manager; decision of the Director COA Regional Office No.
ERLINDA MENDEZ, SAMUEL O. CANETE, NILO VIII is hereby affirmed and the following persons
cited in the various Notices of Disallowances, The issues raised in this case are as follows: (1)
namely: whether members of the board of directors of
water districts are entitled to receive benefits in
Erlinda A. Mendez, for approving
addition to those authorized to be paid pursuant
the questioned
to their charter and the guidelines of the LWUA
payment and
after the effectivity of R. A. No. 6758; (2) whether
at the same time
the disallowance of duplication of claims of
being payee;
transportation allowance of various BWD
Francis H. P. Militante - do employees, as well as the grant of RATA, rice
- allowance, and excessive per diems to members
Domingo V. Cotiamco as of the board of directors of BWD, would impair
payee vested rights, violate any rule against diminution
Apolonio G. Medina - of benefits, and undermine the management
do - prerogative of water districts; and (3) whether the
Nilo T. Ramada - do BWD officers and employees are entitled to
- receive benefits in excess of that authorized by
Virginia P. Espinosa - do law.
-
For the reasons hereafter given, we hold that
Ernesto L. Gorre -
petitioners are not entitled to receive benefits and
do -
allowances in excess of those allowed by P.D. No.
Antonio R. C. Palencia - do
198, the guidelines of the LWUA, and other
-
applicable laws.
Ma. Josette B. Astorga - do
- First. As far as the directors of the BWD are
Love Joy A. Fernandez - do concerned, P. D. No. 198, §13, as amended by P.
- D. No. 768 and P. D. No. 1479, reads:
Frank Bula - Compensation. — Each director shall receive a
do - per diem, to be determined by the board, for each
are held liable. meeting of the board actually attended by him,
but no director shall receive per diems in any
Petitioners filed a motion for reconsideration. As
given month in excess of the equivalent of the
their motion was denied by the Commission on
total per diems of four meetings in any given
January 30, 2001, they filed the present petition,
month. No director shall receive other
alleging that the Commission erred in:
compensation for services to the district.
I. NOT HOLDING THAT THE GRANT OF THE
Any per diem in excess of P50 shall be subject to
SUBJECT BENEFITS TO THE DIRECTORS, OFFICERS
approval of the Administration. (emphasis added)
AND EMPLOYEES OF BWD, HAS LEGAL BASIS, AND
IS GUARANTEED BY THE CONSTITUTION. Petitioners argue that the term “compensation” in
the above provision does not include the
II. HOLDING THAT PETITIONERS ARE NOT
allowances and per diems which had been
ENTITLED TO RECEIVE OTHER BENEFITS
disallowed in this case. They cite P. D. No. 1146,
PURSUANT TO SECTION 13 OF PD 198, AS
§2(i), as amended by R.A. No. 8291, which
AMENDED.
provides that “compensation” means “the basic
III. NOT HOLDING THAT SECTION 13 OF P. D. 198, pay or salary by an employee, pursuant to his
AS AMENDED, WAS ALREADY REPEALED AND/OR employment/appointment, excluding per diems,
SUPERSEDED BY REPUBLIC ACT 6758, OTHERWISE bonuses, overtime pay, allowances and any other
KNOWN AS THE SALARY STANDARDIZATION LAW, emoluments received in addition to the basic pay
WHICH TOOK EFFECT IN JULY, 1989. which are not integrated into the basic pay under
IV. HOLDING THAT THE CONTINUED DISALLOWANCE existing laws.”
OF THESE BENEFITS WOULD NOT VIOLATE THE The contention is untenable. The statutory
POLICY OR RULE ON NON-DIMINUTION OF provision invoked refers to the basis for the
BENEFITS AND THE EQUITY RULE. computation of employer and employee
V. NOT HOLDING THAT THE BENEFITS GRANTED contributions to the GSIS as well as the benefits to
TO BWD OFFICERS AND EMPLOYEES IS A which such employees are entitled. In the same
MANAGEMENT PREROGATIVE WHICH ACT OR manner, under §32 of the National Internal
PRIVILEGE SHOULD ENJOY THE PRESUMPTION OF Revenue Code, “compensation” includes fees,
LEGALITY UNTIL OTHERWISE DECLARED BY THE salaries, wages, commissions, and similar items
COURTS AND THAT THE GRANT OF THESE for purposes of recognizing taxable income. The
BENEFITS NOT ONLY APPLIES TO THE PERMANENT definitions of the term “compensation” in these
EMPLOYEES BUT ALSO TO THE OFFICERS AND statutes are for limited purposes only and cannot
MEMBERS OF THE BOARD OF BWD.
be deemed to comprehend such other purposes Sec. 17. Salaries of Incumbents.-Incumbents of
not specifically included in the provisions thereof. positions presently receiving salaries and
additional compensation/fringe benefits including
Petitioners, also invoke the rulings of this Court in
those absorbed from local government units and
Kneebone v. NLRC, Vengco v. Trajano, and
other emoluments, the aggregate of which
Philippine Duplicators, Inc. v. NLRC, to support
exceeds the standardized salary rate as herein
their contention that the prohibition against the
prescribed, shall continue to receive such excess
payment of compensation other than per diems
compensation, which shall be referred to as
does not include the payment of allowances and
transition allowance. The transition allowance
other benefits.
shall be reduced by the amount of salary
These cases do not apply to this case. They refer adjustment that the incumbent shall receive in
to the exclusion made by this Court of allowances the future.
and other benefits from the salaries of employees
We do not agree. R. A. No. 6758, §4 specifically
in the private sector, not to the compensation of
provides that the Salary Standardization Law
members of the board of directors of water
applies to “positions, appointive or elective, on
districts, whose rights to compensation, as
full or part-time basis, now existing or hereafter
already stated, are governed by P. D. No. 198.
created in the government, including
Under §13 of this Decree, per diem is precisely
government-owned or controlled corporations and
intended to be the compensation of members of
government financial institutions.” These
board of directors of water districts. Indeed,
positions, with their corresponding functions, are
words and phrases in a statute must be given
described as follows:
their natural, ordinary, and commonly-accepted
meaning, due regard being given to the context in Sec. 5. Position Classification System. – The
which the words and phrases are used. By Position Classification System shall consist of
specifying the compensation which a director is classes of positions grouped into four main
entitled to receive and by limiting the amount categories, namely: professional supervisory,
he/she is allowed to receive in a month, and, in professional non-supervisory, sub-professional
the same paragraph, providing “No director shall supervisory, and sub-professional non-
receive other compensation” than the amount supervisory, and the rules and regulations for its
provided for per diems, the law quite clearly implementation.
indicates that directors of water districts are Categorization of these classes of positions shall
authorized to receive only the per diem be guided by the following considerations:
authorized by law and no other compensation or
allowance in whatever form. (a) Professional Supervisory Category. – This
category includes responsible positions of a
Second. Petitioners contend that the prohibition managerial character involving the exercise of
in P.D. No. 198, §13 against the grant of additional management functions such as planning,
compensation to board members must be organizing, directing, coordinating, controlling and
deemed repealed by virtue of §22 of R. A. No. overseeing within delegated authority the
6758, otherwise known as the Salary activities of an organization, a unit thereof or of a
Standardization Law, which took effect on July 1, group, requiring some degree of professional,
1989. They contend that §13 of P.D. No. 198 is technical or scientific knowledge and experience,
inconsistent with the following provisions of the application of managerial or supervisory skills
Salary Standardization Law: required to carry out their basic duties and
Sec. 12. Consolidation of Allowances and responsibilities involving functional guidance and
Compensation.-All allowances, except for control, leadership, as well as line supervision.
representation and transportation allowances; These positions require intensive and thorough
clothing and laundry allowances; subsistence knowledge of a specialized field usually acquired
allowance of marine officers and crew on board from completion of a bachelor’s degree or higher
government vessels and hospital personnel; degree courses.
hazard pay; allowances of foreign service The positions in this category are assigned Salary
personnel stationed abroad; and such other Grade 9 to Salary Grade 33.
additional compensation not otherwise specified
herein as may be determined by the DBM, shall (b) Professional Non-Supervisory Category. – This
be deemed included in the standardized salary category includes positions performing tasks
rates herein prescribed. Such other additional which usually require the exercise of a particular
compensation, whether in cash or in kind, being profession or application of knowledge acquired
received by incumbents only as of July 1, 1989 not through formal training in a particular field or just
integrated into the standardized salary rates shall the exercise of a natural, creative and artistic
continue to be authorized. ability or talent in literature, drama, music and
other branches of arts and letters. Also included
.... are positions involved in research and application
of professional knowledge and methods to a It is noteworthy that even the Local Water Utilities
variety of technological, economic, social, Administration (LWUA), in Resolution No. 313, s.
industrial and governmental functions; the 1995, entitled “Policy Guidelines on
performance of technical tasks auxiliary to Compensation and Other Benefits to WD Board of
scientific research and development; and in the Directors,” on which petitioners rely for authority
performance of religious, educational, legal, to grant themselves additional benefits,
artistic or literary functions. These positions acknowledges that directors of water districts are
require thorough knowledge in the field of arts not organic personnel and, as such, are deemed
and sciences or learning acquired through excluded from the coverage of the Salary
completion of at least four (4) years of college Standardization Law. Memorandum Circular No.
studies. 94-002 of the DBM-CSC-LWUA-PAWD Oversight
Committee states in pertinent part:
The positions in this category are assigned Salary
Grade 8 to Salary Grade 30. As the WD Board of Directors’ function is limited
to policy-making under Sec. 18 of Presidential
(c) Sub-Professional Supervisory Category. – This
Decree 198, as amended, it is the position of the
category includes positions performing
Oversight Committee that said WD Directors are
supervisory functions over a group of employees
not to be treated as organic personnel, and as
engaged in responsible work along technical,
such are deemed excluded from the coverage of
manual or clerical lines of work which are short of
RA 6758, and that their powers, rights and
professional work, requiring training and
privileges are governed by the pertinent
moderate experience or lower training but
provisions of PD 198, as amended, not by RA
considerable experience and knowledge of a
6758 or Executive Order No. 164, s. 1994.
limited subject matter or skills in arts, crafts or
trades. There is, therefore, no basis for petitioners’
contention that the provisions of P.D. No. 198 on
These positions require knowledge acquired from
the compensation of members of the board of
secondary or vocational education or completion
directors of water districts are inconsistent with
of up to two (2) years of college education.
the provisions of the Salary Standardization Law.
The positions in this category are assigned Salary
Third. Petitioners contend that even before this
Grade 4 to Salary Grade 18.
Court declared in Davao City Water District v.
(d) Sub-Professional Non-Supervisory Category. – Civil Service Commission that water districts are
This category includes positions involved in government-owned and controlled corporations
structured work in support of office or fiscal subject to the jurisdiction of the COA, water
operations or those engaged in crafts, trades or districts had already been granting additional
manual work. These positions usually require benefits to members of the board of directors,
skills acquired through training and experience or with the approval of the Local Water Utilities
completion of elementary education, secondary or Administration (LWUA), and to their officers and
vocational education or completion of up to two employees and that they continued doing so after
(2) years of college education. the promulgation of the decision in that case.
The positions in this category are assigned Salary Petitioners contend they have thus acquired a
Grade 1 to Salary Grade 10. vested right to these benefits of which they
cannot now be deprived without violating their
It is obvious that the Salary Standardization Law property rights and the rule on non-diminution of
does not apply to petitioners because directors of benefits.
water districts are in fact limited to policy-making
and are prohibited from the management of the This contention too has no merit. The erroneous
districts. P.D. No. 198, §18 described the application and enforcement of the law by public
functions of members of boards of directors of officers does not estop the Government from
water districts as follows: making a subsequent correction of such errors.
More specifically, where there is an express
Sec. 18. Functions Limited to Policy-Making. — provision of law prohibiting the grant of certain
The function of the board shall be to establish benefits, the law must be enforced even if it
policy. The Board shall not engage in the detailed prejudices certain parties due to an error
management of the district. committed by public officials in granting the
Furthermore, the fact that §§12 and 17 of the benefit. As already stated, P.D. No. 198 expressly
Salary Standardization Law speak of allowances prohibits the grant of compensation other than
as “benefits” paid in addition to the salaries the payment of per diems, as determined by the
incumbents are presently receiving makes it clear LWUA pursuant to P. D. No. 198, to directors of
that the law does not refer to the compensation of water districts. Practice, without more, no matter
board of directors of water districts as these how long continued, cannot give rise to any
directors do not receive salaries but per diems for vested right if it is contrary to law.
their compensation.
The same rule applies to the officers and employees are entitled to receive benefits in
employees of the BWD. R.A. No. 6686, which then excess of that authorized by law.
applied, provides that all government personnel Fourth. Petitioners invoke management
are entitled to a Christmas bonus of one (1) prerogative to justify the grant of allowances and
month basic salary and additional cash gift of other benefits to both the board of directors of
P1,000.00. The cash gift granted to Francis H. P. BWD and its officers and employees.
Militante, BWD Manager, for the year 1994
amounted to P1,500.00. The Resident Auditor, With respect to the board of directors, there is no
therefore, properly disallowed the P500.00 thereof basis for such contention. To begin with,
as this amount was in excess of that authorized management prerogative refers to the right of an
by law. On the other hand, findings regarding the employer to regulate all aspects of employment,
duplication of claims for the transportation such as the freedom to prescribe work
allowance granted to various employees of the assignments, working methods, processes to be
BWD are findings of fact by the Resident Auditor. followed, regulation regarding transfer of
The question is whether such claims were employees, supervision of their work, lay-off and
properly accounted for and not whether this discipline, and dismissal and recall of work.
disallowance will impair vested rights. It is well- Clearly, the existence of such right presupposes
settled that findings of fact of quasi-judicial the existence of an employer-employee
agencies, such as the COA, are generally relationship. In the present case, the BWD board
accorded respect and even finality by this Court, if of directors are not employees of BWD. As
supported by substantial evidence, in recognition already noted, their function, as defined by P. D.
of their expertise on the specific matters under No. 198, is limited to policy-making, implying that
their jurisdiction. In the present case, the findings their relationship to the water district is more
of the Resident Auditor were not only supported fiduciary than that of employer-employee.
by the evidence, but they remained unrebutted Moreover, as also noted before, the right of
by petitioners who simply relied on claims based directors of water districts to the payment of
on impairment of vested rights and diminution of compensation is expressly provided for in P.D. No.
benefits. 198, thus pre-empting the exercise of any
discretion by the water districts.
Petitioners’ reliance on De Jesus v. Commission
on Audit, Philippine Ports Authority v. Commission With respect to the officers and employees of
on Audit, and Manila International Airport BWD, it has been held that the terms and
Authority v. Commission on Audit is likewise conditions of employment of government
erroneous. In De Jesus, it was held that the employees are governed by law. Thus, the
circular issued by the Department of Budget and exercise of management prerogative by
Management to implement the Salary government corporations are limited by the
Standardization Law, which discontinued the provisions of the laws applicable to them. The
payment of allowances and fringe benefits cash gift granted to the general manager as part
previously granted on top of basic salary, was of his Christmas bonus was in excess of that
ineffective for lack of publication in the Official authorized by R. A. No. 6686. It cannot be
Gazette or in a newspaper of general circulation, justified by the exercise of management
as required by law. On the other hand, in prerogative as it is contrary to law.
Philippine Ports Authority and Manila International Finally, the disallowance of the duplication of
Airport Authority, the issue resolved was the right claims for transportation allowance does not fall
of employees to receive RATA over and above the under management prerogative as this does not
standardized salary after the effectivity of R. A. pertain to the power of management to determine
No. 6758. These cases are not in point as the the terms and conditions of employment but
issues in the present case are, to repeat, (1) pertains to whether or not the claims are properly
whether members of the board of directors of accounted for.
water districts are entitled to receive even after
the effectivity of the Salary Standardization Law Fifth. Petitioners finally cite the grant of similar
benefits other than their authorized per diems, benefits to the directors of the National Power
contrary to the provisions of their charter and the Corporation (NAPOCOR) to support their claim
resolution of the LWUA; (2) whether the that board of directors are entitled to receive
disallowance of duplication of claims of allowances and other benefits in addition to per
transportation allowance to BWD employees, as diems. The comparison drawn by petitioner
well as the grant of RATA, rice allowance, and between the BWD and NAPOCOR has no basis.
excessive per diems to members of the board of The grant of other allowances to NAPOCOR board
directors of BWD, would impair vested rights and members in COA Decision No. 99-020 is based on
violate any rule against diminution of benefits the Revised NAPOCOR Charter (R. A. No. 6395, as
and undermine the management prerogative of amended by P. D. No. 1360), which states:
the BWD; and (3) whether the BWD officers and
Sec. 6 . . . . The members of said Board shall Amending, Expanding, Increasing and Integrating
receive a per diem of not to exceed Five Hundred the Social Security and Insurance Benefits of
Pesos for each regular or special meeting of the Government Employees and Facilitating the
Board actually attended by them, and upon payment thereof under Commonwealth Act No.
approval of the Secretary of Energy, shall receive 167, as amended, and for other purposes.
such other allowances as the Board may 167 SCRA 99 (1988).
prescribe, any provision of law to the contrary
notwithstanding. 173 SCRA 155 (1989).
As the Commission pointed out in its decision COA 241 SCRA 380 (1995).
Case No. 90-020: Espino v. Cleofe, 52 SCRA 92 (1973).
The entitlement to per diems and other U. S. v. Estapia, 37 Phil. 17 (1917).
allowances by members of the board was
originally derived from the revised NPC Charter. Sec. 22. Repealing Clause.-All laws, decrees,
All allowances enjoyed by the board members orders, rules or regulations or parts thereof
were approved by the Ministry of Energy to inconsistent with the provisions of this Act are
conform with the imposition of an additional hereby repealed, amended, or modified
condition under the NPC Charter that the receipt accordingly.
of the allowances other than per diems should 201 SCRA 593 (1991).
carry the approval of the MOE.
E. Rodriguez, Inc. v. Collector of Internal Revenue,
The entitlement to these allowances cannot be 28 SCRA 1119 (1969).
removed by R.A. 6758 or any subsequent law,
Cebu Portland Cement Co. v. de Jesus, 7 SCRA
consistent with the policy of non-diminution of
pay embodied under R. A. 6758 since these 572 (1963).
allowances were already being received and the Grace Christian High School v. Court of Appeals,
board’s right to these allowances was already 281 SCRA 133 (1997).
established before the enactment of R. A. 6758. R.A. No. 6686, §1.
Since the allowances were fixed at a time when
Laysa v. Commission on Audit, G. R. No. 128134,
the authority of the board to grant the same was October 18, 2000.
still valid and effective, the allowances are also
valid and should remain part of the compensation 294 SCRA 152 (1998).
of the members of the board. 214 SCRA 653 (1992).
Unlike P.D. No. 198, §13, the Charter of NAPOCOR 238 SCRA 714 (1994).
expressly granted members of its board of
directors the right to receive allowances in Tierra International Construction Corp. v. NLRC,
addition to their per diems, subject only to the 256 SCRA 36 (1996).
approval of the Secretary of Energy. Petitioners P. D. 198, §18.
cannot thus claim similar treatment as the board
of directors of NAPOCOR. The BWD board of Alliance of Government Workers (AGW) v. The
directors’ right to compensation, it bears Minister of Labor, 209 Phil. 1 (1983).
emphasis, is limited to per diems. FIRST DIVISION
WHEREFORE, the petition for certiorari is DENIED [G.R. No. 125498. February 18, 1999]
and the decision of the Commission on Audit,
CONRADO B. RODRIGO, JR., ALEJANDRO A.
dated September 21, 2000, as well as its
FACUNDO and REYNALDO G. MEJICA, petitioners,
resolution, dated January 30, 2001, is AFFIRMED.
vs. THE HONORABLE SANDIGANBAYAN (First
SO ORDERED. Division), OMBUDSMAN and PEOPLE OF THE
Davide, Jr., C.J., Bellosillo, Melo, Puno, Kapunan, PHILIPPINES, respondents.
Panganiban, Quisumbing, Pardo, Buena, Ynares- DECISION
Santiago, De Leon, Jr., Sandoval-Gutierrez, and
KAPUNAN, J.:
Carpio, JJ., concur.
Petitioners Conrado B. Rodrigo and Reynaldo G.
Vitug, J., in the result.
Mejica are the Mayor and Municipal Planning and
Per Chairman Celso D. Gangan and Development Coordinator, respectively, of San
Commissioners Raul C. Flores and Emmanuel M. Nicolas, Pangasinan, while petitioner Alejandro A.
Dalman. Facundo is the former Municipal Treasurer of the
Rollo, p. 26. same municipality.

Petition, p. 7; Rollo, p. 9. On 15 June 1992, the Municipality of San Nicolas,


represented by Mayor Rodrigo, entered into an
agreement with Philwood Construction,
represented by Larry Lu, for the electrification of In September 1993, petitioners requested the
Barangay Caboloan, San Nicolas, for the sum of Provincial Auditor to lift the notice of disallowance
P486,386.18, requiring: and to re-inspect the project. Petitioners
reiterated their plea in a letter to the Provincial
1. Installation of the two (2) units diesel power
Auditor dated 3 November 1993, attaching
generator (20) KVA, 220 W, Battery start and
therewith a “Certificate of Acceptance and
other accessories);
Completion” signed by Clemente Arquero, Jr.,
2. Installation of 24 rolls feeder lines with nos. 6, 8 Barangay Captain of Caboloan, and Eusebio
and ten wires; Doton, President of the Cabaloan Electric
3. Installation of 40 units 4 x 4 wooden post with Cooperative. The Provincial Auditor, however,
accessories; and allegedly did not act on petitioners’ requests.

4. Construction of powerhouse with concrete On 10 January 1994, the Provincial Auditor filed a
foundation double throw safety switches (double criminal complaint for estafa before the
pole, 250 amperes capacity of 220 V with fuse). Ombudsman against petitioners. Likewise
impleaded were Larry Lu and Ramil Ang,
On 2 September 1992, Mejica, the Planning and President and General Manager, and Project
Development Coordinator of San Nicolas, Engineer, respectively, of Philwood Construction.
prepared an Accomplishment Report stating that
the Caboloan Power Generation project was On 10 June 1995, Acting Ombudsman Francisco
97.5% accomplished. Said report was supposedly Villa approved the filing of an information against
approved by mayor Rodrigo and confirmed by petitioners for violation of Section 3 (e) of
Larry Lu. On the basis of said report, payment of Republic Act No. 3019 before the Sandiganbayan.
P452,825.53 was effected by the Municipal On 28 July 1995, petitioners filed a motion for
Treasurer, petitioner Facundo, to Philwood reinvestigation before the Sandiganbayan. The
Construction. Sandiganbayan granted said motion in an Order
On 14 August 1993, petitioners received a Notice dated 22 April 1996.
of Disallowance dated 21 June 1993 from the On 7 November 1995, the Office of the Special
Provincial Auditor of Pangasinan, Atty. Agustin Prosecutor issued a memorandum recommending
Chan, Jr., who found that as per COA (Commission that the charges against petitioners be
on Audit) evaluation of the electrification project, maintained. The Ombudsman approved said
only 60.0171% of the project (equivalent to memorandum.
P291,915.07) was actually accomplished. Of the
Petitioners thereafter filed before the
two units of generator supposedly purchased,
Sandiganbayan a motion to quash the information
only one second-hand unit was delivered. The
alleging, as grounds therefor that (1) the facts
same generator broke down after only two nights
alleged in the information did not constitute an
of operation. In addition, instead of 40 wooden
offense, and (2) the same information charged
posts, only 27 were installed. The powerhouse
more than one offense. Petitioners, however, did
was only 65.635% completed. The Provincial
not elaborate on these grounds. They instead
Auditor thus disallowed the amount of
faulted the Provincial Auditor for instituting the
P160,910.46.
complaint against them notwithstanding the
The graph below serves to illustrate the conflicts pendency of their opposition to the notice of
between Mejica’s report and the COA’s: disallowance. They also argued that the evidence
against them did not establish the element of
Percentage damage nor the presence of any conspiracy
Accomplish between them.
ed The Sandiganbayan denied said motion in an
Order dated 18 March 1996.
Amount paid P452,825. 93.0090% (accdg. to
On 18 March 1996, the prosecution moved to
By Municipality 53 Mejica’s
report) suspend petitioners pendente lite. Petitioners
opposed the motion on the ground that the
Cost of Actual P291,915. 60.0171% (accdg. to Sandiganbayan lacked jurisdiction over them. In
a Resolution dated 2 July 1996, the
Accomplishmen07 COA report)
Sandiganbayan ruled that it had jurisdiction over
t
petitioners and ordered the suspension of
petitioners pendente lite.
Amount P160,910. 33.08% (difference)
46 Petitioners thus filed before this Court the instant
Disallowed
petition for certiorari under Rule 65, praying that
the Court annul: (a) the order of the
Sandiganbayan denying petitioners’ motion to
quash, and (b) the resolution of the same court I
upholding its jurisdiction over petitioners. Petitioners contend that the institution by the
Petitioners likewise prayed that this Court issue a Provincial Auditor of the complaint despite the
temporary restraining order to enjoin the pendency of their opposition to the notice of
Sandiganbayan from proceeding with the case. disallowance violates their right to due process.
On 28 August 1998, the court resolved to issue They submit that “the issuance of a notice of
the temporary restraining order prayed for. disallowance against (them) compels the
provincial auditor to either accept a settlement or
Petitioners allege the following grounds in support
adjudicate and decide on ‘the written explanation
of their petition:
for the purpose of lifting/settling the suspension
I or extending the time to answer beyond the
THE SANDIGANBAYAN ERRED IN ALLOWING THE ninety (90) day period prior to its conversion into
LITIGATION OF THE CRIMINAL INFORMATION FOR a disallowance.”’
CONSPIRACY IN VIOLATING SECTION 3(E) OF THE The italicized portion above is an excerpt from
ANTI- GRAFT ACT (R.A. 3019) WHEN THE NOTICE Section 44.6.4 of the State Audit Manual, which
OF DISALLOWANCE STILL PENDS WITH THE states in full:
PROVINCIAL AUDITOR UNDER PETITIONER’
Sec. 44.6.4. Auditor’s Responsibility re
PROTEST SUPPORTED BY CERTIFICATE OF
Evaluation of Disallowance. – It shall be the
COMPLETION AND ACCEPTANCE OF THE
responsibility of the auditor to exercise
REQUIRED ELEMENT OF 'CAUSING UNDUE INJURY
professional judgment in evaluating, on the basis
TO ANY PARTY, INCLUDING THE GOVERNMENT’
of the facts and circumstances of each case as
AND GROSS NEGLIGENCE.
well as the pertinent provisions of applicable laws,
II rules and regulations, the grounds for a charge or
THE SANDIGANBAYAN HAS NO JURISDICTION TO suspension/disallowance of an account or
PROCEED AGAINST ALL THE PETITIONERS AND transaction.
ALL THE PROCEEDINGS THEREIN, PARTICULARLY It shall be the responsibility of the auditor to
THE ORDER OF SUSPENSION FROM OFFICE exercise sound judgment in evaluating the written
PENDENTE LITE, ARE NULL AND VOID AB INITIO. explanation of the accountable/responsible/liable
III officer concerned for the purpose of lifting the
suspension or extending the time to answer
THE ONGOING PROCEEDINGS BEFORE THE beyond the ninety (90) day period prior to its
SANDIGANBAYAN IS A CLEAR VIOLATION OF THE conversion into a disallowance. (Underscoring
CONSTITUTIONAL RIGHTS OF THE PETITIONERS supplied.)
UNDER THE DUE PROCESS CLAUSE AS IT WAS
PRECEDED BY HASTY, MALICIOUS, SHAM AND The aforequoted provision should be read in
HASTY PRELIMINARY INVESTIGATION INEVITABLY conjunction with Section 82 of the State Audit
EXPOSING THEM TO A PROLONGED ANXIETY, Code, which states that:
AGGRAVATION, EXPENSES, AND HUMILIATION OF (a) charge of suspension which is not satisfactorily
A PUBLIC TRIAL. explained within ninety days after receipt or
IV notice by the accountable officer concerned shall
become a disallowance, unless the Commission or
THE PRECIPITATE SANDIGANBAYAN ORDER OF auditor concerned shall, in writing and for good
SUSPENSION IS A LEGAL ERROR AS THE SAME cause shown, extend the time for answer beyond
EVIDENTLY THE LACK OF THE REQUIRED COLD ninety days.
NEUTRALITY OF AN IMPARTIAL TRIBUNAL
VIOLATING PETITIONERS’ CONSTITUTIONAL At this point, it may be useful to distinguish
RIGHTS UNDER THE DUE PROCESS CLAUSE AND between a disallowance and a suspension. A
BILL OF RIGHTS. disallowance is the disapproval of a credit or
credits to an account/accountable officer’s
The first ground raises two issues: (1) whether accountability due to non-compliance with law or
petitioners’ right to due process was violated by regulations. Thus, the auditor may disallow an
the filing of the complaint against them by the expenditure/transaction which is unlawful or
Provincial Auditor, and (2) whether the improper.
Ombudsman committed grave abuse of discretion
in filing the information against petitioners. The A suspension, on the other hand, is the
second questions the jurisdiction of the deferment of action to debit/credit the
Sandiganbayan over petitioners. The third and account/accountable officer’s accountability
fourth grounds are related to the first and are pending compliance with certain requirements. A
subsumed thereunder. notice of suspension is issued on transactions or
accounts which could otherwise have been settled
After a meticulous scrutiny of petitioners’ except for some requirements, like lack of
arguments, we find the petition devoid of merit.
supporting documents or certain signatures. It is warranted.” The Provincial Auditor need not
also issued on transactions or accounts the resolve the opposition to the notice of
legality/propriety of which the auditor doubts but disallowance and the motion for re-inspection
which he may later allow after satisfactory or pending in his office before he institutes such
valid justification is submitted by the parties complaint so long as there are sufficient grounds
concerned. to support the same. The right to due process of
the respondents to the complaint, insofar as the
As stated in Section 82, supra, however, the
criminal aspect of the case is concerned, is not
suspension shall become a disallowance if the
impaired by such institution. The respondents will
charge of suspension is “not satisfactorily
still have the opportunity to confront the
explained within ninety days after receipt or
accusations contained in the complaint during the
notice by the accountable officer concerned." The
preliminary investigation. They may still raise the
ninety-day period within which the accountable
same defenses contained in their motion to lift the
officer may answer the charge of suspension may
disallowance, as well as other defenses, in the
nevertheless be extended by the Commission or
preliminary investigation. Should the Provincial
the auditor for “good cause shown.”
Auditor later reverse himself and grant
Clearly, petitioners misinterpreted Section 44.6.4. respondents’ motions, or should the COA, or this
First, petitioners were not charged with Court, subsequently absolve them from liability
suspension but disallowance. Second, the “written during the pendency of the preliminary
explanation” referred to in said section is “for the investigation, the respondents may ask the
purpose of lifting the suspension or extending the prosecuting officer to take cognizance of such
time to answer beyond the ninety (90) day period decision. The prosecuting officer may then
prior to its conversion into a disallowance,” not for accord such decision its proper weight.
contesting a disallowance, as petitioners
It bears stressing that the exoneration of
wrongfully assert. Section 44.6.4., therefore, finds
respondents in the audit investigation does not
no application in this case.
mean the automatic dismissal of the complaint
On the other hand, respondents correctly invoke against them. The preliminary investigation, after
Sections 55 and 56 of Commission on Audit all, is independent from the investigation
Circular No. 85-156-B, which respectively provide: conducted by the COA, their purposes distinct
SECTION 55. REPORTING FRAUD/UNLAWFUL from each other. The first involves the
ACTIVITIES determination of the fact of the commission of a
crime; the second relates to the administrative
If after evaluation of the findings, the auditor is aspect of the expenditure of public funds.
convinced that the evidence sufficiently discloses
the fraud and other unlawful activities and Accordingly, we hold that the Ombudsman did not
identifies the perpetrators thereof, he shall err in entertaining the complaint filed by the
prepare the sworn statements of the examining Provincial Auditor against petitioners, nor the
witnesses and/or other witnesses and make a Sandiganbayan in allowing trial to proceed,
report to the Manager/Regional Director despite the pendency of petitioners’ motions
concerned, attaching thereto copies of the before the auditor.
pertinent affidavits and other supporting II
documents.
Petitioners argue that their opposition to the
SECTION 56. INSTITUTION OF CRIMINAL ACTION disallowance, supported as it is by a certificate of
If criminal prosecution is warranted, the Regional acceptance and completion, would betray the
Director/Manager concerned with respect to absence of the elements of evident bad faith or
National Government Agencies/government negligence, and damage. They likewise claim
Owned or Controlled Corporations or that the evidence does not establish conspiracy
Provincial/City Auditors with respect to local among them.
government units shall prepare a letter-complaint The presence or absence of the elements of the
and file the same with the Tanodbayan or the crime, however, is evidentiary in nature and is a
local deputized Tanodbayan prosecutor within ten matter of defense, the truth of which can be best
(10) days from receipt of the report from the passed upon after a full-blown trial on the merits.
examining auditor, attaching thereto copies of the The same applies to the alleged absence of any
sworn statements or affidavits of witnesses and conspiracy between the accused.
other pertinent documents.
This Court, moreover, has maintained a consistent
Section 56 imposes upon the Provincial Auditor policy of non-interference in the determination of
the duty to file a complaint before the the Ombudsman regarding the existence of
Tanodbayan (now the Ombudsman) when, from probable cause, provided there is no grave abuse
the evidence obtained during the audit, he is in the exercise of such discretion. In a recent
convinced that “criminal prosecution is
decision, this Court, quoting Young vs. Office of the pertinent portions of Section 4 of P.D. No.
the Ombudsman, stated the rationale for this rule: 1606 now reads:
... The rule is based not only upon respect for the Sec. 4. Jurisdiction. -- the Sandiganbayan shall
investigatory and prosecutory powers granted by exercise original jurisdiction in all cases involving:
the Constitution to the Office of the Ombudsman a. Violations of Republic Act No. 3019, as
but upon practicality as well. Otherwise, the amended, otherwise known as the Anti-Graft and
functions of the court will be grievously hampered Corrupt Practices Act, Republic Act No. 1379, and
by innumerable petitions assailing the dismissal of Chapter II, Section 2, Title VII of the Revised Penal
investigatory proceedings conducted by the Office Code, where one or more of the principal accused
of the Ombudsman with regard to complaints filed are officials occupying the following positions in
before it, in much the same way that the courts the government, whether in a permanent, acting
would be extremely swamped if they could be or interim capacity, at the time of the commission
compelled to review the exercise of discretion on of the offense:
the part of the fiscals or prosecuting attorneys
each time they decide to file an information in (1) Officials of the executive branch occupying the
court or dismiss a complaint by a private positions of regional director and higher,
complainant. otherwise classified as grade “27” and higher, of
the Compensation and Position Classification Act
Petitioners have failed to establish any such of 1989 (Republic Act No. 6758), specifically
abuse on the part of the Ombudsman. including:
III (a) Provincial governors, vice-governors, members
Petitioners next question the jurisdiction of the of the sangguniang panlalawigan and provincial
Sandiganbayan. They contend that Mayor treasurers, assessors, engineers, and other
Rodrigo occupies a position of Grade 24 and is, provincial department heads;
therefore, beyond the original and exclusive (b) City mayors, vice-mayors, members of the
jurisdiction of the Sandiganbayan. sangguniang panlungsod, city treasurers,
Before the passage of Republic Act No. 7975 on assessors, engineers, and other city department
30 March 1995, the pertinent portions of section 4 heads.
of Presidential Decree No. 1606, as amended by (c) Officials of the diplomatic service occupying
Presidential Decree No. 1861, read as follows: the position of consul and higher;
SEC. 4. Jurisdiction. – The Sandiganbayan shall (d) Philippine army and air force colonels, naval
exercise: captains, and all officers of higher rank;
(a) Exclusive original jurisdiction in all cases (e) PNP chief superintendent and PNP officers of
involving: higher rank;
(1) Violations of Republic Act No. 3019, as (f) City and provincial prosecutors and their
amended, otherwise known as the Anti-Graft and assistants, and officials and prosecutors in the
Corrupt Practices Act, Republic Act No. 1379, and Office of the Ombudsman and special prosecutor;
Chapter II, Section 2, Title VII of the Revised Penal
Code; (g) Presidents, directors or trustees, or managers
of government-owned or controlled corporations,
(2) Other offenses or felonies committed by state universities or educational institutions or
public officers and employees in relation to their foundations;
office, including those employed in government-
owned or controlled corporations, whether simple (2) Members of Congress and officials thereof
or complexed with other crimes, where the classified as Grade “27” and up under the
penalty prescribed by law is higher than prision Compensation and Position Classification Act of
correccional or imprisonment for six (6) years, or 1989;
a fine of P6,000.00; PROVIDED, HOWEVER, that (3) Members of the judiciary without prejudice to
offenses or felonies mentioned in this paragraph the provisions of the Constitution;
where the penalty prescribed by law does not
exceed prision correccional or imprisonment for (4) Chairmen and members of Constitutional
six (6) years or a fine of P6,000.00 shall be tried Commissions, without prejudice to the provisions
by the proper Regional Trial Court, Metropolitan of the Constitution; and
Trial Court, Municipal Trial Court and Municipal (5) All other national and local officials classified
Circuit Trial Court. as Grade “27” and higher under the
xxx. Compensation and Position Classification Act of
1989.
Section 2 of R.A. No. 7975 subsequently redefined
the jurisdiction of the Anti-Graft Court such that b. Other offenses or felonies committed by the
public officials and employees mentioned in
subsection (a) of this section in relation to their One is given the impression that only lowly
office. government workers or the so-called ‘small fry’
are expediently tried and convicted by the
c. Civil and criminal cases filed pursuant to and in
Sandiganbayan. The reason for this is that at
connection with Executive Order Nos. 1, 2, 14 and
present, the Sandiganbayan has the exclusive and
14-A.
original jurisdiction over graft cases committed by
In cases where none of the principal accused are all officials and employees of the government,
occupying positions corresponding to salary grade irrespective of rank and position, from the lowest-
“27” or higher, as prescribed in the said Republic paid janitor to the highly-placed government
Act No. 6758, or PNP officers occupying the rank official. This jurisdiction of the Sandiganbayan
of superintendent or higher, or their equivalent, must be modified in such a way that only those
exclusive jurisdiction thereof shall be vested in occupying high positions in the government and
the proper Regional Trial Court, Metropolitan Trial the military (the big fishes) may fall under its
Court, Municipal Trial Court, and Municipal Circuit exclusive and original jurisdiction. In this was,
Trial Court, as the case may be, pursuant to their the Sandiganbayan can devote its time to big
respective jurisdictions as provided in Batas time cases involving the “big fishes” in the
Pambansa Blg. 129. government. The regular courts will be vested
xxx with the jurisdiction of cases involving less-
ranking officials (those occupying positions
Then Associate, now Chief Justice, Hilario Davide corresponding to salary grade twenty-seven (27)
explained the effects of these amendments in and below and PNP members with a rank lower
People vs. Magallanes: than Senior Superintendent. This set-up will
As a consequence of these amendments, the prove more convenient to people in the
Sandiganbayan partly lost its exclusive original provinces. They will no longer have to travel to
jurisdiction in cases involving violations of R.A. Manila to file their complaint or to defend
No. 3019, as amended, as amended; R.A. No. themselves. They can already file their complaint
1379, and Chapter II, Section 2, Title VII of the or their defense before the Regional Trial Court or
Revised Penal Code, it retains only cases where the Municipal Trial Court in their respective
the accused are those enumerated in subsection localities, as the case may be.
a, Section 4 above and, generally, national and To distinguish the “big fish” from the “small fry,”
local officials classified as Grade “27” and higher Congress deemed the 27th Grade as the
under the Compensation and Position demarcation between those who should come
Classification Act of 1989 (R.A. No. 6758). under the jurisdiction of the Sandiganbayan and
Moreover, its jurisdiction over other offenses or those within the regular courts’. (While H.B. No.
felonies committed by public officials and 9825 originally intended only officials of Grade 28
employees in relation to their office is no longer and above as within the exclusive and original
determined by the prescribed penalty, viz., that jurisdiction of the Sandiganbayan, the resulting
which is higher than prision correccional or law included officials of Grade 27.) Thus, officials
imprisonment for six years or a fine of P6,000.00; occupying positions of Grade 27 and above,
it is enough that they are committed by those charged with crimes referred to in Section 4 a.
public officials and employees enumerated in and b., are within the original and exclusive
subsection a, Section 4 above. However, it jurisdiction of the Sandiganbayan; those below
retains its exclusive original jurisdiction over civil come under the jurisdiction of the regular courts.
and criminal cases filed pursuant to or in
connection with E.O. Nos. 1, 2, 14, and 14-A. Although some positions of Grade 27 and above
are stated by name in Section 4 a., the position of
The apparent intendment of these amendments is Municipal Mayor is not among them.
to ease the dockets of the Sandiganbayan and to Nevertheless, Congress provided a catchall in
allow the Anti-Graft Court to focus its efforts on Section 4 a. (5), thus:
the trial of those occupying higher positions in
government, the proverbial “big fish.” Section 4, (5) All other national and local officials classified
as amended, freed the Sandiganbayan from the as Grade “27” and higher under the
task of trying cases involving lower-ranking Compensation and Position Classification Act of
government officials, imposing such duty upon 1989.
the regular courts instead. The present structure Such a catchall is necessary, for it would be
is also intended to benefit these officials of lower impractical, if not impossible, for Congress to list
rank, especially those residing outside Metro down each position created or will be created
Manila, charged with crimes related to their office, pertaining to Grades 27 and above.
who can ill-afford the expenses of a trial in Metro
At present, Volume III of the 1997 edition of the
Manila. As the Explanatory Note of House Bill No.
Index of Occupational Services, Position Titles and
9825 states:
Salary Grades, which was prepared by the
Department of Budget and Management (DBM)
pursuant to Republic Act No. 6758, otherwise Salary
known as the “Compensation and Position Sched
Classification Act of 1989,” lists the following ule
positions under Salary Grade 27, including the Grade 1st 2nd 3rd 4th 5th 6th 7th 8th
position of “Municipal Mayor I”:
Assistant Commissioner of Internal Revenue Xxx
Assistant Regional Cabinet Secretary
Assistant Regional Executive Secretary 24 10,1 10,2 10,3 10,4 10,6 10,6 10,7 10,8
Board Member I 35 36 39 42 46 52 68 66
Chairman, Police Regional Appellate Board Xxx
Chief of Mission, Class II
City Government Department Head III Petitioners conclude that Mayor Rodrigo, at the
City Trial Court Judge time of the commission of the alleged crime, was
Clerk of the Commission occupying a Grade 24 position and, thus, not
Commission Member I within the Sandiganbayan’s original and exclusive
Court Attorney VI jurisdiction, as defined in Section 2 of R.A. No.
Court of Appeals Reporter II 7975.
Deputy Administrator I This is a simplistic, and altogether incorrect,
Deputy Commissioner I interpretation of the law.
Deputy Executive Director III
Deputy Insurance Commissioner Section 5, Article IX-C of the Constitution provides
Director III that:
Executive Clerk of Court II The Congress shall provide for the standardization
Executive Director II of compensation of government officials and
Government Corporate Attorney III employees, including those in government-owned
Graft Investigation Officer II or controlled corporation with original charters,
Municipal Mayor I taking into account the nature of the
Professor IV responsibilities pertaining to, and the
Project Manager III qualifications required for their positions.
Prosecutor II
Provincial Agrarian Reform Adjudicator This provision is not unique to the 1987
Public Attorney IV Constitution. The 1973 Constitution, in Section 6,
Regional Treasurer Article XII thereof, contains a very similar
Register of Deeds IV provision pursuant to which then President
Sangguniang Panlalawigan Member Marcos, in the exercise of his legislative powers,
Sangguniang Panlungsod Member II issued Presidential Decree No. 985.
Scientist II However, with the advent of the new Constitution,
Solicitor II and in compliance therewith, Congress enacted
Special Prosecution Officer II R.A. No. 6758. Section 2 thereof declares it the
State Counsel IV policy of the State “to provide equal pay for
SUC President I substantially equal work and to base differences
SUC Vice-President III in pay upon substantive differences in duties and
Earlier, in the 1989 version of the same Index, the responsibilities, and qualification requirements of
Municipal Mayor was also assigned a Salary Grade the positions."
of 27. It appears, therefore, that petitioner Mayor To give life to this policy, as well as the
comes within the exclusive and original constitutional prescription to “(take) into account
jurisdiction of the Sandiganbayan. the nature of the responsibilities pertaining to,
Petitioners, however, claim that at the time of the and the qualifications required” for the positions
commission of the alleged crime on or about 2 of government officials and employees, Congress
September 1992, Mayor Rodrigo, the highest adopted the scheme employed in P.D. No. 985 for
public ranking public official impleaded in this classifying positions with comparable
case, was receiving a monthly salary of responsibilities and qualifications for the purpose
P10,441.00. Such amount 6758 is supposedly of according such positions similar salaries. This
equivalent to a fourth step increment in Grade 24 scheme is known as the “Grade,” defined in P.D.
under the Salary Schedule prescribed in Section 7 No. 985 as:
of R.A. No. 6758: * Includ[ing] all classes of positions which, although
SEC. 7. Salary Schedule. – The Department of different with respect to kind or subject matter of
Budget and Management is hereby directed to work, are sufficiently equivalent as to level of
implement the Salary Schedule prescribed below: difficulty and responsibilities and level of
qualification requirements of the work to warrant
the inclusion of such classes of positions within The Department of Budget and Management is
one range of basic compensation. hereby authorized to determine the officials who
are of equivalent rank to the foregoing Officials,
The Grade is therefore a means of grouping
where applicable, and may be assigned the same
positions “sufficiently equivalent as to level of
Salary Grades based on the following guidelines:
difficulty and responsibilities and level of
qualification requirements of the work” so that xxx
they may be lumped together in “one range of As indicated in the aforequoted section, Congress
basic compensation.” delegated the rest of this tedious task (of fixing
Thus, Congress, under Section 8 of R.A. No. 6758, Salary Grades) to the DBM, subject to the
fixed the Salary Grades of officials holding standards contained in R.A. No. 6758, by
constitutional positions, as follows: authorizing the DBM to “determine the officials
who are of equivalent rank to the foregoing
SEC. 8. Salaries of Constitutional Officials and
officials, where applicable,” and to assign them
their Equivalent. – Pursuant to Section 17, Article
the same Salary Grades subject to a set of
XVIII of the Constitution, the salary of the
guidelines found in said section.
following officials shall be in accordance with the
Salary Grades indicated hereunder: For positions below those mentioned under
Section 8, Section 9 directs the DBM to prepare
Salar
the “Index of Occupational Services” guided by
y
(a) the Benchmark Position prescribed in Section
Grad
9, and (b) the following factors:
e
(1) the education and experience required to
perform the duties and responsibilities of the
President of 33 position;
the
(2) nature and complexity of the work to be
Philippines
performed;
Vice-President 32
of the (3) the kind of supervision received;
Philippines (4) mental and/or physical strain required in the
President of 32 completion of the work;
the Senate
Speaker of 32 (5) nature and extent of internal and external
the House of relationships;
Representativ (6) kind of supervision exercised;
es
(7) decision-making responsibility;
Chief Justice 32
of the (8) responsibility for accuracy of records and reports;
Supreme (9) accountability for funds, properties and
Court equipment; and
Senator 31
Member of 31 (10) hardship, hazard and personal risk involved in
the House of the job.
Representativ Pursuant to such authority, the DBM drafted the
es 1989 Index of Occupational Services, Position
Associate 31 Titles and Salary Grades, later revised in 1997. In
Justices of the both versions, the position of Municipal Mayor was
Supreme assigned a Salary Grade 27.
Court That petitioner received a salary less than that
Chairman of a 31 prescribed for such Grade is explained by
Constitutional Sections 10 and 19 (b) of R.A. No. 6758, which
Commission respectively provide:
under
Article IX, SEC. 10. Local Government Units (LGUs). -- The
1987 rates of pay in LGUs shall be determined on the
Constitution basis of the class and financial capability of each
Member of a 30 LGU: Provided, That such rates of pay shall not
Constitutional exceed the following percentages of the rates in
Commission the salary schedule prescribed under Section 7
under Article hereof:
IX, 1987 For For
Constitution
Provinces/Citi Municipaliti Section 4 a., as amended, his co-accused are also
es es subject to the Anti-Graft Court’s jurisdiction.
Specia 100% WHEREFORE, the petition is hereby DISMISSED
l Cities and the Temporary Restraining Order issued by
1st 100% 90% this Court on 28 August 1996 LIFTED.
Class
2nd 95% 85% SO ORDERED.
Class Davide, Jr., C.J., (Chairman), Melo, and Pardo, JJ.,
3rd 90% 80% concur.
Class
4th 85% 75% * * Note, however, the P1.00 discrepancy between
Class petitioner's alleged salary and the salary
5th 80% 70% prescribed under the 4th step increment for
Class Grade 24.*
6th 75% 65% Rollo, p. 44.
Class
Annex “A” of Petition, Rollo, p. 39.
SEC. 19. Funding Source. – The funding sources
Annex “B” of Petition, id., at 40.
for the amounts necessary to implement this Act
shall be as follows: Annex “C” of Petition, id., at 41.
(a) x x x Annex “D” of Petition, id., at 42.
(b) For local government units, the amount shall The Anti-Graft and Corrupt Practices Act.
be charged against their respective funds. Local Rollo, pp. 20-21. Italics in the original.
government units which do not have adequate or
sufficient funds shall only partially implement the Id., at. 188. Italics in the original.
established rates as may be approved by the Joint Presidential Decree No. 1445.
Commission under Section 8 of Presidential
Decree No. 1188: Provided, That any partial Section 2k, Commission on Audit Circular No. 85-
implementation shall be uniform and 156-B. Section 3.9 of the Manual on Certificate of
proportionate for all positions in each local Settlement and Balances (Revised 1993)
government unit: Provided further, That savings (Commission on Audit Circular No. 94-001) which
from National Assistance to Local Government superseded COA Circular No. 85-156-B, defines
Units (NALGU) funds may be used for this disallowance as “the disapproval in audit of a
purpose. transaction, either in whole or in part.”
x x x. (Underscoring supplied.) Section 19, id. See also Section 14 of the Manual
on Certificate of Settlement and Balances
Thus, a local government official’s actual salary (Revised 1993).
may be less than what the Salary Schedule under
Section 7 prescribes, depending on the class and Section 2r, id. Under Section 3.18 of the Manual
financial capability of his or her respective local on Certificate of Settlement and Balances
government unit. This circumstance, however, (Revised 1993), a suspension is “the deferment of
has no bearing on such official’s Grade. As the action to allow or disallow in audit a transaction
foregoing discussion shows, on official’s salary pending compliance with certain requirements.”
is determined by the Grade accorded his Section 21, id. See also Section 16, Manual on
position, and ultimately by the nature of his Certificates of Settlement and Balances (Revised
position – the level of difficulty and 1993).
responsibilities and level of qualification
requirements of the work. To give credence to Cf. Ramos vs. Aquino, 39 SCRA 585 (1971).
petitioners’ argument that Mayor Rodrigo’s salary Olivarez vs. Sandiganbayan, 248 SCRA 700
determines his Grade would be to misconstrue the (1995); Ocampo III vs. Sandiganbayan, 236 SCRA
provisions of R.A. No. 6758, and ignore the 1 (1994).
constitutional and statutory policies behind said
Bienvenido Tan, Jr., vs. The Honorable
law.
Sandiganbayan (Third Division), G.R. No. 128764,
Petitioner mayor’s position having been classified 10 July 1998; Rene Knecht and Cristina de Knecht
as Grade 27 in accordance with R.A. No. 6758, vs. Hon. Aniano A. Desierto, as Ombudsman, et
and having been charged with violation of Section al., G.R. No. 121916, 26 June 1998; Leonila
3 (e) of R.A. No. 3019, petitioner is subject to the Garcia-Rueda vs. Wilfred L. Pacasio et al., G.R. No.
jurisdiction of the Sandiganbayan, as defined by 118141, 5 September 1997; Camanag vs.
Section 4 a. of P.D. No. 1606, as amended by Guerrero, 268 SCRA 473 (1997); Paredes vs.
Section 2 of R.A. No. 7975. By virtue of the same Sandiganbayan, 252 SCRA 659 (1996); Olivarez
vs. Sandiganbayan, supra, note 15.
Annie Tan vs. The Office of the Ombudsman, et “Salary Grade” is “the numerical place on the
al., G.R. Nos. 114332 &114895, September 10, Salary Schedule representing multiple steps or
1998. rates which is assigned to a class.” (Section 2s,
P.D. No. 985.)
228 SCRA 718 (1995).
GRADE 33 – This Grade is assigned to the
Entitled “An Act to Strengthen the Functional
President of the Republic of the Philippines as the
and Structural Organization of the
highest position in the government. No other
Sandiganbayan, amending for that Purpose
position in the government service is considered
Presidential Decree No. 1606 , as amended."
to be of equivalent rank.
Entitled “Revising Presidential Decree No. 1486
GRADE 32 – This Grade is limited to the Vice
Creating A Special Court to be known as
President of the Republic of the Philippines and
“Sandiganbayan” and for Other Purposes,”
those positions which head the Legislative and
promulgated 10 December 1978.
Judicial Branches of the government, namely: the
Entitled “Amending the Pertinent Provisions of Senate President, Speaker of the House of
Presidential Decree No. 1606 and Batas Representatives and Chief Justice of the Supreme
Pambansa Blg. 129 Relative to the Jurisdiction of Court. No other positions in the government
the Sandiganbayan and for other purposes,” service are considered to be of equivalent rank.
promulgated 23 March 1983.
GRADE 31 – This Grade is assigned to Senators
249 SCRA 212 (1995). and members of the House of Representatives
Anti-Graft and Corrupt Practices Act. and those with equivalent rank as follows: the
Executive Secretary, Department Secretary,
Entitled, “An Act Declaring Forfeiture in Favor of Presidential Spokesman, Ombudsman, Press
the State Any Property Found to Have Been Secretary, Presidential Assistant with Cabinet
Unlawfully Acquired by Any Public Officer or Rank, Presidential Adviser, National Economic and
Employee and Providing for the Proceeding Development Authority Director General, Court of
Therefor.” Appeals Presiding Justice, Sandiganbayan
Article 210, Direct Bribery; Article 211, Indirect Presiding Justice, Secretary of the Senate,
Bribery; and Article 212, Corruption of Public Secretary of the House of Representatives, and
Officials. President of the University of the Philippines.
Creating the Presidential Commission on Good An entity with a broad functional scope of
Government. operations and wide area of coverage ranging
from top level policy formulation to the provision
Regarding the Funds, Moneys, Assets, and of technical and administrative support to the
Properties Illegally Acquired or Misappropriated by units under it, with functions comparable to the
Former President Ferdinand E. Marcos, Mrs. aforesaid positions in the preceding paragraph,
Imelda R. Marcos, Their Close Relatives, can be considered organizationally equivalent to a
Subordinates, Business Associates, Dummies, Department, and its head to that of a Department
Agents, or Nominees. Secretary.
Defining the Jurisdiction Over Cases Involving the GRADE 30 – Positions included are those of
Ill-gotten Wealth of Former President Ferdinand E. Department Undersecretary, Cabinet
Marcos, Mrs. Imelda R. Marcos, Members of Their Undersecretary, Presidential Assistant, Solicitor
Immediate Family, Close Relatives, Subordinates, General, Government Corporate Counsel, Court
Close and/or Business Associates, Dummies, Administrator of the Supreme Court, Chief of Staff
Agents, and Nominees. of the Office of the Vice-President, National
Amending E.O. No. 14. Economic and Development Authority Deputy
Director General, Presidential Management Staff
Introduced by Representatives Garcia (P.),
Executive Director, Deputy Ombudsman,
Starke, Damasing, Apostol, Abueg, Abaya, Sator,
Associate Justices of the Court of Appeals,
Panes and other members of the House of
Associate Justices of the Sandiganbayan, Special
Representatives Committee on Justice.
Prosecutor, University of the Philippines Executive
An Act Prescribing A Revised Compensation and Vice-President, Mindanao State University
Position Classification System in the Government President, Polytechnic University of the Philippines
and Other Purposes. R.A. No. 6758 went into President and President of other state universities
effect on July 1, 1989 per Section 23 thereof. and colleges of the same class.
A Decree Revising the Position Classification and Heads of councils, commissions, boards and
Compensation Systems in the National similar entities whose operations cut across
Government, and integrating the same. offices or departments or are serving a sizeable
Section 3h, P.D. No. 985. portion of the general public and whose coverage
is nationwide or whose functions are comparable
to the aforecited positions in the preceding The questioned interpretation and implementation
paragraph, may be placed at this level. are contained in the memorandum of the
respondent dated 24 August 1989, the pertinent
The equivalent rank of positions not mentioned
portion of which reads:
herein or those that may be created hereafter
shall be determined based on these guidelines. . . . Thus effective July 1, 1989, the salaries,
allowances and other emoluments to be received
Republic of the Philippines
by COA officials and employees, regardless of
SUPREME COURT
station or assignment, are only those that are
Manila
paid directly by COA out of its own appropriations
EN BANC and contributions.
Henceforth, the continued payment by any other
G. R. No. 91860 January 13, 1992 government entity, whether in the national, local
or corporate sector, to any COA official or
ROSEO U. TEJADA and RADITO C. CHING, employee of such compensation, including those
petitioners, incorporated in the computerized payroll, would
vs. no longer have legal basis. Accordingly, in order
HON. EUFEMIO C. DOMINGO, in his capacity not to delay the processing of the salary payroll of
as Chairman of the Commission on Audit, all COA officials and employees for September,
respondent. 1989, all such additional emoluments will be
Brillantes, Nachura, Navarro & Arcilla for deleted in the computation of the said payroll. 2
petitioners. The genesis of this controversy is not disputed.
Petitioners Roseo U. Tejada and Radito C. Ching
DAVIDE, JR., J.: are senior clerks of the COA assigned to the
auditing units of the Philippine National Bank
In this special civil action for certiorari with (PNB) and the Central Bank (CB), respectively.
prohibition and mandamus, petitioners urge this
Court to annul and set aside the alleged Before the effectivity of R.A. No. 6758, Tejada's
"erroneous, arbitrary, wrongful and illegal gross monthly compensation was P3,673.20,
interpretation and implementation" 1 by the broken down as follows:
respondent Chairman of the Commission on Audit basic salary P 1,623.00
(COA) of Republic Act. No. 6758, otherwise known
as the Compensation and Position Classification cost of living allowance 700.00
Act of 1989. bank equity pay 648.00
longevity pay 140.00
Specifically involved is Section 18 of the Act, amelioration pay 162.00
which reads: meal allowance 400.00
Sec.18. Additional Compensation of Commission —————
on Audit Personnel and Other Agencies. — In
order to preserve the independence and integrity P 3,673.20
of the Commission on Audit (COA), its officials and while Ching's was only P3,134.00, itemized as
employees are prohibited from receiving salaries, follows:
honoraria, bonuses, allowances or other
basic salary P 1,623.00
emoluments from any government entity, local
government unit, and government-owned and cost of living allowance 700.00
controlled corporations, and government financial bank equity pay 649.00
institutions, except those compensation paid amelioration pay 162.00
directly by the COA out of its appropriations and —————
contributions.
P 3,134.00
Government entities including government-owned
or controlled corporations including financial Of the foregoing, only the basic salary and the
institutions and local government units are hereby cost of living allowance, in the total sum of
prohibited from assessing or billing other P2,323.00, were due each of them as senior clerks
government entities, government-owned or in the COA. The other benefits were voluntarily
controlled corporations including financial given to them by the PNB and the CB,
institutions or local government units for services respectively.
rendered by its officials and employees as part of Prior to the enactment of Presidential Decree No.
their regular functions for purposes of paying 1445, otherwise known as the Government
additional compensation to said officials and Auditing Code of the Philippines, all officials and
employees. employees of the COA, like herein petitioners,
assigned to, inter alia, government-owned or
controlled corporations (GOCCs), received their to fall on January l5 of every calendar year) to the
salaries, allowances, additional compensation, National Treasury by each government
emoluments and other fringe benefits directly corporation/subsidiary concerned; provided, that
from such GOCCs. This practice was not deemed if the operating budgets of the government
effective enough to enhance the independence corporations/ subsidiary are reduced during the
and protect the integrity of the COA. Thus, with year as a result of operating fund shortfall or
the end in view of insulating these COA officials reduction of its operations, the cost of audit
and employees, particularly the auditors, from services previously determined shall be reduced
unwarranted influence, thereby preserving the proportionately. . . .
independence and integrity of the COA, Sec. 3. All allowances and fringe benefits granted
Presidential Decree No. 1445 expressly mandates by government-owned or controlled corporations
that the salaries and other forms of compensation to the personnel of the Commission's auditing
of the personnel of the COA shall follow a units in such corporations shall be directly
common position classification and compensation defrayed by the Commission from its own
plan regardless of agency assignment and shall appropriation pursuant to Section 31 of the
be subject to P.D. No. 985; and that all officials General Provisions of the General Appropriations
and employees thereof, including its Act otherwise known as Batas Pambansa Bilang
representatives and support personnel, shall be 879.
paid their salaries, emoluments and allowances
directly by the COA out of the latter's Thus, the law is clear that the contributions from
appropriations and contributions, 3 which shall be the GOCCs are limited to the cost of audit services
considered as part of its operating expenses to be which are based on the actual cost of the audit
included in the annual appropriations law, but function in the corporation concerned plus a
funded from the assessments made upon, or from reasonable rate to cover overhead expenses. The
contributions of the GOCCs. 4 It directs GOCCs to actual audit cost shall include personnel services,
appropriate in their respective budgets and remit maintenance and other operating expenses,
to the National Treasury an amount at least depreciation on capital and equipment and out-of-
equivalent to the appropriation for the salaries pocket expenses. In respect to the allowances and
and allowances of the representatives and staff of fringe benefits granted by the GOCCs to the COA
the Commission during the preceding fiscal year. 5 personnel assigned to the former's auditing units,
the same shall be directly defrayed by COA from
The requirement of a common position and its own appropriations pursuant to Section 31 of
compensation plan did away with the old practice the General Provisions of the General
of agencies concerned determining the number, Appropriations Act, otherwise known as Batas
compensation and assignment of COA Pambansa Bilang 879. The pertinent portion of
representatives, which was both chaotic and said Section 31 reads as follows:
unjust. The provision on direct payment by COA of
the salaries and other benefits was designed to xxx xxx xxx
instill institution loyalty. 6 Officials and employees on detail with other
This policy was further strengthened by Executive offices, including representatives and support
Order No. 19 which President Corazon C. Aquino personnel of auditing units assigned to serve
enacted on 19 June 1986. 7 Sections 2 and 3 other offices and agencies, shall be paid their
thereof provide: salaries, emoluments, allowances and the
foregoing supplemental compensation, fringe
Sec. 2. (as amended by E.O. No. 271). The cost of benefits and other personal services costs from
audit services rendered to government agencies appropriations of their parent agencies, and in no
by the Commission on Audit shall be covered by case shall such be charged against appropriations
the fund sources provided in Sec. 24 of of the agencies where they are assigned or
Presidential Decree No. 1445 which shall be detailed, except when authorized by law.
incorporated in the national government budget
and included in the Annual General Appropriations This provision was re-stated in the General
Law: provided, that in the case of government- Appropriations Acts (GAA) of the succeeding
owned and/or controlled corporations and its calendar years. 8
subsidiaries, the cost of audit services shall be Then came Section 18 of R.A. No. 6758, and its
based on the actual cost of the audit function in interpretation and implementation 9 by
the corporation concerned, plus a reasonable rate respondent which provoked this case.
to cover overhead expenses. The actual audit cost
shall include personal services, maintenance and Disagreeing with the respondent's stand,
other operating expenses, depreciation on capital petitioners, together with other COA employees,
and equipment and out-of-pocket expenses. sent to the former a letter-request 10 dated 27
September 1989, asking that the order for the
This amount shall be remitted in six equal deletion from the COA Centralized or Special
installments every sixty days (the first installment Payroll of their allowances, fringe benefits and
other emoluments, be reconsidered, and "be additional allowances do not promote auditing
restored or at least considered in the integrity and independence; (e) GOCCs no longer
determination of their respective compensation pay extra emoluments and have been prohibited
rates as of 1 July 1989, so that they will not suffer from doing so; and (f) COA personnel assigned to
any salary deduction when the standardized GOCCs are subject to periodic reshuffling or
salary rates are finally implemented." reassignment pursuant to Sections 20 (4) and 22
(1) of P.D. No. 1445, hence they do not acquire a
On 27 October 1989, respondent issued another
vested right to the additional compensation or
memorandum 11 denying, in effect, the letter-
fringe benefits being paid by GOCCs as the
request. As a consequence, each of the
receiving of such would cease upon their
petitioners presently receive the reduced salary of
reassignment.
P2,323.00.
We required the petitioners to file a Reply to the
Hence, they filed this petition on 7 February 1990.
12 Comment, 16 which they complied with on 28 June
1990. 17 On 10 July 1990, this Court gave due
They raise the following issues: course 18 to the petition and required both parties
1. Does Section 18 of R.A. No. 6758 require, or to simultaneously file their respective
even authorize, the diminution of the gross Memoranda, which they complied with.
compensation of COA personnel which they were To Our mind, the respondent presents the proper
receiving prior to its effectivity, notwithstanding issue and a careful scrutiny of the arguments
the provisions of Sections 12 and 17 of the same adduced by the parties would lead Us to no other
law? conclusion but to sustain the respondent and
2. Were all the salaries, allowances, fringe dismiss the petition for want of merit.
benefits and other emoluments which petitioners The two (2) main issues formulated by petitioners
were receiving as part of their gross are clearly based on erroneous premises or
compensation prior to the effectivity of R.A. No. assumptions. Petitioners assume that their gross
6758 "paid directly by the COA out of its compensation includes the extra emoluments
appropriations and contributions" within the given by the GOCCs to which they are assigned,
meaning of the exception under Section 18 of the that Sections 12 and 17 of the Act grant them
same law? vested rights to such extra emoluments and that
and then submit a negative answer to the first, they were directly paid by the COA out of its
and an affirmative answer to the second as they appropriations and contributions.
were, and have always been, since the effectivity There can be no question that Section 18 of
of P.D. No. 1445, "paid directly by the COA out of Republic Act No. 6758 is designed to strengthen
its appropriations and contributions." 13 further the policy, earlier mandated by the
We required respondent to Comment on the Government Auditing Code of the Philippines and
petition. 14 then by Executive Order No. 19 (as amended by
Executive Order No. 271), to preserve the
Respondent, represented by the Office of the independence and integrity of the COA, by
Solicitor General, filed his Comment on 11 May explicitly PROHIBITING: (1) COA officials and
1990. 15 He maintains that the real issue to be employees from receiving salaries, honoraria,
resolved is: bonuses, allowances or other emoluments from
Whether or not under R.A. No. 6758 COA any government entity, local government unit,
personnel may still be allowed to receive from any GOCCs and government financial institutions,
government agency, local or national, including except such compensation paid directly by the
government-owned or controlled corporations and COA out of its appropriations and contributions,
government financing institutions, other and (2) government entities, including GOCCS,
allowances, emoluments and fringe benefits over government financial institutions and local
and above their legally set salaries and government units from assessing or billing other
allowances as COA employees. government entities, GOCCs, government
financial institutions or local government units for
He then asserts that petitioners are no longer services rendered by the latter's officials and
entitled to the extra allowances and benefits employees as part of their regular functions for
which they used to receive prior to the effectivity purposes of paying additional compensation to
of R.A. No. 6758 for: (a) they are not entitled as a said official and employees. While the cited
matter of right to the additional emoluments they section uses the word "prohibited," Section 22 of
have been receiving from the agencies to which P.D. No. 1445 does not. No one may successfully
they are assigned — such were gratuitously given argue against the proposition that a total removal
by the latter; (b) the extra emoluments from of the temptation and enticement the extra
GOCCs have no legal basis; (c) the additional emoluments provide would be one effective way
allowances created a salary distortion; (d) the to vigorously and aggressively enforce the
Constitutional provision mandating the COA to 2.1. The provisions of MO No. 177, series of 1988,
prevent or disallow irregular, unnecessary, shall apply only to officials and employees of
excessive, extravagant, or unconscionable profit-making and financially viable government-
expenditures, or uses of government funds and owned or controlled corporations and financial
properties. 19 The COA personnel assigned to the institutions which are not receiving subsidies, for
GOCCs who have absolutely nothing to look any operating expenses from the National
forward to or expect from the latter in terms of Government.
extra benefits would have no reason to accord 2.2. Members of the governing boards of any
special treatment to the GOCCs by closing their government-owned or controlled corporation and
eyes to irregular or unlawful expenditures or use financial institution, detailed personnel from other
of funds or property, or conducting perfunctory government agencies/corporations including
audit. The law realizes that such extra benefits personnel of the Commission on Audit (COA) and
could diminish the personnel's seriousness and Civil Service Commission (CSC) are not covered
dedication in the pursuit of their assigned tasks, by the provisions of said Order. (Emphasis
affect their impartiality and provide a continuing supplied)
temptation to ingratiate themselves to the GOCCs
or government financial institutions concerned. In Then, too, among the laws specifically repealed
the end then, they would become ineffective by R.A. No. 6758 20 is the proviso under Section 2
auditors. of P.D. No. 985, which reads:
Upon the other hand, as correctly contended by . . . Provided, that notwithstanding a standardized
the respondent, Memorandum Order No. 177 salary system established for all employees,
rationalizing the compensation structure in additional financial incentives may be established
GOCCs and government financial institutions, by government corporations and financial
issued by the President on 31 May 1988, limits institutions for their employees to be supported
the grant of extra allowances and fringe benefits fully from their corporate funds and for such
to their officials and employees. Section 2 thereof technical positions as may be approved by the
reads: President in critical government agencies.
Sec. 2. Allowances of incumbents. — Incumbents The foregoing legislative and executive
of positions in corporate entities covered by the pronouncements unerringly reveal a two-pronged
Memorandom Order who are presently receiving strategy to preserve and enhance the
additional monthly compensation/fringe benefits independence and integrity of the COA and make
and other emoluments which were continuously its personnel loyal to none other except that
enjoyed for a period of at least 12 months prior to institution and beholden to nobody but the people
the effectivity of this Order, including those whose coffers they must guard with dedication
authorized solely by their governing boards and responsibility.
effected on or before December 31, 1987, the The first aspect of the strategy is directed to the
aggregate of which exceeds the standardized COA itself, while the second aspect is addressed
rates prescribed pursuant to existing laws, rules directly against the GOCCs and government
and regulations and ministered by the financial institutions. Under the first, COA
Department of Budget and Management, shall personnel assigned to auditing units of GOCCs or
continue to receive such excess allowances, government financial institutions can receive only
which shall be referred to as "transition such salaries, allowances or fringe benefits paid
allowance." The "transition allowance" shall be directly by the COA out of its appropriations and
correspondingly reduced by the amount of any contributions. The contributions referred to are
salary increase or salary adjustment that the the cost of audit services earlier mentioned which
incumbent shall receive in the future. cannot include the extra emoluments or benefits
The additional compensation, fringe benefits and now claimed by petitioners. The COA is further
other emoluments which may be considered as barred from assessing or billing GOCCs and
"transition allowance" under this Memorandum government financial institutions for services
Order shall be limited to those which are of rendered by its personnel as part of their regular
common or general application to all the audit functions for purposes of paying additional
personnel of the entities covered under Section 1 compensation to such personnel. Under the
hereof. second, GOCCs and government financial
institutions can no longer rely on Section 2 of P.D.
The Corporate Budget Circular No. 15 issued by No. 985; moreover, fringe benefits and other
the Secretary of the Department of Budget and emoluments in excess of the standardized rates,
Management on 5 July 1988, to implement the which may be continued to be received in the
aforesaid Memorandum Order, pertinently concept of "transition allowance" under
provides for the coverage and exemption thereof, Memorandum Order No. 177, in relation to
thus: Corporate Budget Circular No. 15 (15 July 1988),
2.0 COVERAGE AND EXEMPTION. apply only to the officials and employees of profit-
making and financially viable GOCCs and employee and shall be paid by the National
government financial institutions. Government.
The strategy also promotes and is consistent with xxx xxx xxx
the policy behind R.A. No. 6758, which Section 2 Sec. 17. Salaries of Incumbents. — Incumbents of
thereof announces: positions presently receiving salaries and
Sec. 2. Statement of Policies — It is hereby additional compensation/fringe benefits including
declared the policy of the State to provide equal those absorbed from local government units and
pay for substantially equal work and to base other emoluments, the aggregate of which
differences in pay upon substantive differences in exceeds the standardized salary rate as herein
duties and responsibilities, and qualification prescribed, shall salary rate as herein prescribed,
requirements of the positions. In determining shall continue to receive such excess
rates of pay, due regard shall be given to, among compensation, which shall be referred to as
others, prevailing rates in the private sector for transition allowance. The transition allowance
comparable work. For this purpose, the shall be reduced by the amount of salary
Department of Budget and Management (DBM) is adjustment that the incumbent shall receive in
hereby directed to establish and administer a the future.
unified Compensation and Position Classification The transition allowance referred to herein shall
System, hereinafter referred to as the System, as be treated as part of the basic salary for purposes
provided for in Presidential Decree No. 985, as of computing retirement pay, year end bonus and
amended, that shall be applied for all government other similar benefits.
entities, as mandated by the Constitution.
As basis for computation of the first across-the-
It goes without saying then that the PNB and the board salary adjustment of incumbents with
CB cannot legally and validly continue to grant transition allowance, no incumbent who is
Tejada and Ching, respectively, the extra receiving compensation exceeding the
emoluments in question because these could only standardized salary rate at the time of the
be given to its officials, employees or organic effectivity of this Act, shall be assigned a salary
personnel, subject to Memorandum Order No. 177 lower than ninety percent (90%) of his present
and Corporate Budget Circular No. 15. Otherwise compensation or the standardized salary rate,
stated, Tejada and Ching cannot legally and whichever is higher. Subsequent increases shall
validly receive such extra benefits from the PNB be based on the resultant adjusted salary.
and the CB, respectively, because not only are
they not organic personnel thereof, but also Section 12 refers to the regular allowances and
because of the express prohibition of Section 18 compensation which an instrumentality, entity or
of R.A. No. 6758. agency of the government grants to its organic
personnel. In the case of COA personnel, such
Petitioners' contention that Sections 12 and 17 of allowances and compensation cannot include
R.A. No. 6758 authorize their continued receipt of allowances, fringe benefits or extra emoluments,
the extra allowances from the GOCCs to which such as those claimed by petitioners, which are
they are assigned are patently untenable. These granted by GOCCs or government financial
sections read in full as follows: institutions because Section 18 of the Act itself
Sec. 12. Consolidation of Allowances and bans the COA personnel from receiving them even
Compensation — All allowances, except for as it also prohibits GOCCs and government
representation and transportation allowances; financial institutions from granting such benefits
clothing and laundry allowances; subsistence to personnel of other government
allowance of marine officers and crew on board instrumentalities, entities or agencies assigned to
government vessels and hosoltal personnel; them to perform the regular functions of their
hazard pay, allowances of foreign service mother units. There is no indication at all that R.A.
personnel stationed abroad; and such other No. 6758 has jettisoned the first aspect of the
additional compensation not otherwise specified policy. On the contrary, it has strengthened it. It
herein as may be determined by the DBM, shall would have been absurd and illogical for the law
be deemed included in the standardized salary to impose the prohibition and at the same time
rates herein prescribed. Such other additional mandate its integration in the standardized salary
compensation, whether in cash or in kind, being rates of the personnel of the COA. In the second
received by incumbents only as of July 1, 1989, place, the Secretary of the DBM, Hon. Guillermo
not integrated into the standardized salary rates Carague, has certified that "other than those
shall continue to be authorized. authorized/mandated by law, the allowances,
fringe benefits and other emoluments that were
Existing additional compensation of any national
directly received by COA personnel from the
government official or employee paid from local
various government owned and controlled
funds of a local government unit shall be
corporations, including government financial
absorbed into the basic salary of said official or
institutions, to which they are assigned, were not
provided under the regular appropriations of the The foregoing disquisition renders unnecessary
Commission in the General Appropriations Act of further discussion on the other points raised by
1989 and 1990." 21 They were not so provided respondent.
because, as discussed above, there was no legal WHEREFORE, for lack of merit, the petition is
basis therefor. DISMISSED with costs against petitioners.
Were this Court to accept petitioner's theory, it IT IS SO ORDERED.
would ingraft into the law that which the
legislature never intended and interpret the law in Narvasa, C.J., Melencio-Herrera, Paras, Feliciano,
a manner that defeats or negates its purpose. Padilla, Bidin, Griño-Aquino, Medialdea, Regalado
Worse, it would compel the PNB and the CB to and Romero, JJ., concur.
conntinue granting petitioners Tejada and Ching, Nocon, J., took no part.
respectively, the subject extra emoluments thus
writing into the law an exception for the benefit of
COA personnel. This would be judicial legislation,
which We are not prepared to experiment on. The
questioned law is clear enough. Frankly, its
interpretation is not even called for. Neither may Separate Opinion
petitioners seek refuge or consolation under GUTIERREZ, JR., J., concurring and dissenting:
Section 17. Again, the additional compensation or
fringe benefits and other emoluments referred to I agree with the laudable objectives of Rep. Act
therein are those granted by the mother or parent No. 6758 but I believe that it must be
unit to the incumbents thereof, i.e., the organic implemented in a more reasonable, humane, and
personnel, which include benefits absorbed from realistic manner.
local government units. As correctly observed by The petitioner's problems are symptomatic of the
respondent, the law does not mention benefits improvident and uncalculating approach of
absorbed from GOCCs or government financial Government to the compensation and money
institutions. This is so because no such benefit problems of its own employees. Judges are
was intended to be absorbed. On the contrary, ordered to stop receiving the allowances given to
GOCCs and government financial institutions were them for decades by local governments. And yet,
prohibited from granting them to non-organic no provisions are made in the budget to enable
personnel. the Supreme Court to replace these allowances
Petitioners, nevertheless, posit the view that with equivalent amounts and to provide them with
since, in respect to GOCCs and government the supplies, telephone, electricity and
financial institutions, the law does not seem to maintenance services, and accomodations which
make a distinction between an incumbent therein have been furnished by local governments since
who is an organic personnel thereof and an the turn of the century. Public school teachers are
incumbent who is a COA personnel assigned to given increased salaries by the national
their auditing units, petitioners must, for purposes government but, at the same time, the "city
of Section 17, be considered "incumbents" of the share" which the local governments used to pay is
PNB and the CB. They appeal to the rule on withdrawn. The salary increases are thus
statutory construction that where the law does meaningless inspite of so much publicity and
not make any distinction, no distinction should be fanfare given to them.
made. A distinction is not in order for the meaning The two petitioners in this case are clerks. When a
of incumbent is not doubtful nor susceptible of clerk joins the government service, he does so on
more than one interpretatioin. An incumbent is a the basis of the total compensation package
person who is in present possession of an office; regularly given for a fairly long period to
one who is legally authorized to discharge the occupants of that position. Unlike the chief or
duties of an office. 22 An office is a public charge assistant chief auditor, he does not expect to be
or employment, an employment on behalf of the shifted from agency to agency. In theory a clerk
government in any station or public trust, not joins the COA as a national office but in actuality
merely transient, occasional or incidental. 23 An he joins the COA Supreme Court, COA Philippine
incumbent then can only refer to the holder of an National Bank, COA Bureau of Prisons, etc. To
office either by appointment or by election. suddenly reduce the take home pay which has
Insofar as petitioners were concerned, they are been received for many years is cruel and
incumbents of the position to which they have unnecessary.
been appointed — senior clerks of the COA — and
not of the PNB or the CB to which they are merely If standardization of incomes of all clerks in all
temporarily assigned. government offices is to be effected no matter
how different the workloads, the confidentiality or
sensitivity of functions, the complexity and
magnitutde of assignments, and the amounts of
funds and properties being checked by the office, If standardization of incomes of all clerks in all
some kind of transition arrangement to equal the government offices is to be effected no matter
lost income must be provided by the Commission how different the workloads, the confidentiality or
itself, at the very least. sensitivity of functions, the complexity and
magnitutde of assignments, and the amounts of
It is easy to mount arguments in defense of
funds and properties being checked by the office,
implementing rules intended to make certain
some kind of transition arrangement to equal the
offices more independent and, supposedly, more
lost income must be provided by the Commission
effective. But the arguments become rhetorical,
itself, at the very least.
quixotic, and illusive if they do not take into
account the hardships and sacrifices which It is easy to mount arguments in defense of
affected personnel, especially rank and file implementing rules intended to make certain
workers, are compelled to suffer. offices more independent and, supposedly, more
effective. But the arguments become rhetorical,
I, therefore, regret that I cannot concur with the
quixotic, and illusive if they do not take into
majority opinion in its entirety until a more
account the hardships and sacrifices which
humane and practical mode of implementation is
affected personnel, especially rank and file
devised.
workers, are compelled to suffer.
Cruz, J., concurs.
I, therefore, regret that I cannot concur with the
majority opinion in its entirety until a more
Separate Opinion humane and practical mode of implementation is
devised.
GUTIERREZ, JR., J., concurring and dissenting:
Cruz, J., concurs.
I agree with the laudable objectives of Rep. Act
No. 6758 but I believe that it must be Footnotes
implemented in a more reasonable, humane, and 1 Rollo, 2.
realistic manner.
2 Rollo, 20.
The petitioner's problems are symptomatic of the
3 P.D. No. 1445, pars. 2 and 3, Section 22.
improvident and uncalculating approach of
Government to the compensation and money 4 Id., par. 1, Section 24.
problems of its own employees. Judges are 5 Id., par. 2, Id.
ordered to stop receiving the allowances given to
them for decades by local governments. And yet, 6 TANTUICO, JR., F.S., State Audit Code
no provisions are made in the budget to enable Philippines, 1982 ed., 185-186.
the Supreme Court to replace these allowances 7 Amended later by Executive Order No. 271,
with equivalent amounts and to provide them with promulgated on 25 July 1987.
the supplies, telephone, electricity and
maintenance services, and accomodations which 8 Third paragraph of Section 27, GAA of 1987
have been furnished by local governments since (Executive Order No. 87); Section 24, GAA of 1988
the turn of the century. Public school teachers are (R.A., No. 6642); Section 25, GAA of 1989 (R.A.
given increased salaries by the national No. 6688); Section 31, GAA of 1990 (R.A. No.
government but, at the same time, the "city 6831); and Section 33, GAA of 1991 (R.A. No.
share" which the local governments used to pay is 7078).
withdrawn. The salary increases are thus 9 Rollo, 20-21.
meaningless inspite of so much publicity and
fanfare given to them. 10 Id., 22-28.
11 Id., 29-30.
The two petitioners in this case are clerks. When a
clerk joins the government service, he does so on 12 Id., 2.
the basis of the total compensation package 13 Rollo, 10-11.
regularly given for a fairly long period to
occupants of that position. Unlike the chief or l4 Id., 31.
assistant chief auditor, he does not expect to be 15 Id., 41.
shifted from agency to agency. In theory a clerk
joins the COA as a national office but in actuality 16 Rollo, 31.
he joins the COA Supreme Court, COA Philippine 17 Id., 34.
National Bank, COA Bureau of Prisons, etc. To
suddenly reduce the take home pay which has 18 Id., 48.
been received for many years is cruel and 19 Section 2 (2), Articie IX-D, 1987 Constitution.
unnecessary.
20 Section 16 reads:
Repeal of Special Salary Laws and Regulations. All as Metropolitan Manila Development Authority
laws, decrees, executive orders, corporate (MMDA). Section 11 thereof reads:
charters, and other issuances or parts thereof, Section 11. Transitory Provisions. – To prevent
that exempt agencies from the coverage of the disruption in the delivery of basic urban services
System, or that authorize and fix position pending the full implementation of the MMDA’s
classification, salaries, pay rates or allowances of organizational structure and staffing pattern, all
specified positions, or groups of officials and officials and employees of the interim MMA shall
employees or of, agencies which the System, continue to exercise their duties and functions
including the proviso under Section 2 and Section and receive their salaries and allowances until
16 of Presidential Decree No. 985 are hereby they shall have been given notice of change of
repealed. duties and functions, and of being transferred to
21 Letter of Secretary Carague dated 24 August another office or position.
1990, marked asAnnex "B" of respondent's ...
Memorandum, 121.
The civil service laws, rules and regulations
22 Black's Law Dictionary, Fifth ed,, 691. pertinent to the displacement of personnel
23 Id., 976. affected by this Act shall be strictly enforced. The
national government shall provide such amounts
EN BANC
as may be necessary to pay the benefits accruing
[G.R. No. 139792. November 22, 2000] to displaced employees at the rate of one and
ANTONIO P. SANTOS, petitioner, vs. THE one-fourth (1¼) month’s salary for every year of
HONORABLE COURT OF APPEALS, METROPOLITAN service: Provided, That, if qualified for retirement
AUTHORITY, now known as METROPOLITAN under existing retirement laws, said employees
MANILA DEVELOPMENT AUTHORITY, and THE may opt to receive the benefits thereunder.
CIVIL SERVICE COMMISSION, respondents. On 16 May 1996, the President of the Philippines
DECISION issued Memorandum Order No. 372 approving the
Rules and Regulations Implementing R.A. No.
DAVIDE, JR., C.J.: 7924. Pursuant thereto, the MMDA issued
In this petition for review on certiorari petitioner Resolution No. 16, series of 1996, which, inter
assails the decision of 19 August 1999 of the alia, authorized the payment of separation
Court of Appeals in CA-G.R. SP No. 48301, which benefits to the officials and employees of the
held that petitioner’s separation pay under former MMA who would be separated as a result
Section 11 of R.A. No. 7924 should be limited to of the implementation of R.A. No. 7924.
the number of years of his service in the On 30 August 1996, the MMDA issued a
Metropolitan Manila Authority (MMA) only, Memorandum to petitioner informing him that in
excluding his years of service as judge of the view of his “voluntary option to be separated from
Metropolitan Trial Court (MeTC) of Quezon City for the service” his services would automatically
which he has already been given retirement cease effective at the close of office hours on 15
gratuity and pension. September 1996, and that he would be entitled to
The undisputed facts are as follows: “separation benefits equivalent to one and one-
fourth (1¼) monthly salary for every year of
On 18 January 1983, petitioner was appointed service as provided under Section 11 of the MMDA
Judge of the MeTC of Quezon City, and he Law.”
thereafter assumed office. After the military-
backed EDSA revolt, petitioner was reappointed to In view of some doubt or confusion as to the
the same position. extent of his separation benefits, petitioner
submitted a Position Paper wherein he asserted
On 1 April 1992, petitioner optionally retired from that since the retirement gratuity he received
the Judiciary under R.A. No. 910, as amended, and under R.A. No. 910, as amended, is not an
received his retirement gratuity under the law for additional or double compensation, all the years
his entire years in the government service; and of his government service, including those years
five years thereafter he has been regularly in the Judiciary, should be credited in the
receiving a monthly pension. computation of his separation benefits under R.A.
On 2 December 1993, petitioner re-entered the No. 7924. The Assistant Manager for Finance of
government service. He was appointed Director the MMDA referred the Position Paper to the
III of the Traffic Operation Center of the MMA. His Regional Office of the CSC-NCR.
appointment was approved by the Civil Service On 7 October 1996, Director IV Nelson Acebedo of
Commission (CSC). the CSC-NCR handed down an opinion that the
On 1 March 1995, Congress enacted R.A. No. payment of petitioner’s separation pay must be in
7924, which reorganized the MMA and renamed it accordance with Civil Service Resolution No. 92-
063, pertinent portions of which read:
[T]he payment of separation/[retirement] benefits On 19 August 1999, the Court of Appeals
cannot be subject to the prohibition against the promulgated its decision, now challenged in this
[sic] double compensation in cases when officers case. It held that the CSC was “correct in
and employees who were previously granted said dismissing petitioner’s appeal from the opinion of
benefits are rehired or reemployed in another Director Acebedo.” It ratiocinated as follows:
government Agency or Office. Thus, there is no There is no specific rule of law which applies to
need for separated employees to refund the petitioner’s case. Nevertheless, the Court finds it
separation/retirement benefits they received equitable to deny his claim for payment of
when subsequently reemployed in another separation pay at the rate of one and one-fourth
government agency or office. (1¼) month’s salary for every year of his service
… This being so, while an employee who was paid in government, that is, inclusive of the number of
separation/retirement benefits is not required to years he served as Judge of the Metropolitan Trial
refund the same once reemployed in the Court of Manila [sic].
government service, as aforestated, for reasons of Petitioner already received and is continually
equity however, it would be proper and logical receiving gratuity for his years of service as a
that said separation/retirement benefits should Metropolitan Trial Court Judge. Equity dictates
nevertheless be deducted from the retirement/ that he should no longer be allowed to receive
[separation] pay to be received by the employee further gratuity for said years of service in the
concerned. Moreover, in this instance, the guise of separation pay.
employee concerned has the option either to
refund his separation/retirement benefits and Suffice it to state that upon his retirement from
claim his gross retirement/separation pay without his office as a Judge, petitioner has already closed
any deduction corresponding to his separation a chapter of his government service. The State
pay received, or not [to] refund his has already shown its gratitude for his services
separation/retirement pay but suffer a deduction when he was paid retirement benefits under
of his retirement/separation gratuity for the total Republic Act No. 901 [sic]. For that is what
amount representing his previous retirement benefits are for. Rewards [are] given
separation/retirement pay received. to an employee who has given up the best years
of his life to the service of his country (Gov’t.
His motion for reconsideration having been Service Insurance System v. Civil Service
denied, petitioner elevated the opinion of Director Commission, 245 SCRA 179, 188).
Acebedo to the CSC.
Now, the state again wishes to show its gratitude
On 21 October 1997, the CSC promulgated to petitioner by awarding him separation pay for
Resolution No. 97-4266 affirming the opinion of his services as a director of the Metro Manila
Director Acebedo and dismissing petitioner’s Authority (MMA), another chapter of petitioner’s
appeal. Citing Chaves v. Mathay, it held that government service which has come to a close by
petitioner cannot be paid retirement benefits the reorganization of the MMA into the
twice – one under R.A. No. 910, as amended, and Metropolitan Manila Development Authority.
another under R.A. No. 7924 – for the same
services he rendered as MeTC Judge. He can only The Court, in limiting the computation of
exercise one of two options in the computation of petitioner’s separation pay to the number of years
his separation pay under R.A. 7924. These of his service at the MMA, merely is implementing
options are (1) to refund the gratuity he received the ruling in “Chavez, Sr. vs. Mathay” (37 SCRA
under R.A. No. 910, as amended, after he retired 776), which ruling, if not actually in point, is
from the MeTC and get the full separation pay for nevertheless applicable owing to its “common-
his entire years in the government, that is 9 years sense consideration.” Said ruling reads:
and 2 months with the MeTC plus two (2) years “The ‘common-sense consideration’ stated by Mr.
and eight (8) months for his services as Director Justice J.B.L. Reyes for the Court in Espejo, that if
III in the defunct MMA, at the rate of one and one- a retiree is being credited with his years of service
fourth salary for every year of service pursuant to under his first retirement in computing his
MMDA Memorandum dated 30 August 1996; or (2) gratuity under his second retirement, it is but just
to retain the gratuity pay he received for his that the retirement gratuity received by him
services as MeTC Judge but an equivalent amount under his first retirement should also be charged
shall be deducted from the separation benefits to his account, manifestly govern the case at bar.
due from the former MMA for his entire It is but in accordance with the rule consistently
government service. enunciated by the Court as in Anciano v. Otadoy,
On 9 June 1998, the CSC promulgated Resolution affirming Borromeo, that claims for double
No. 98-1422 denying petitioner’s motion for retirement or pension such as petitioner’s, ‘would
reconsideration. Accordingly, petitioner filed with run roughshod over the well-settled rule that in
the Court of Appeals a petition to set aside these the absence of an express legal exception,
Resolutions. pension and gratuity laws should be so construed
as to preclude any person from receiving double The petitioner cannot take refuge under the
pension.’ (p. 780, underscoring supplied) second paragraph of Section 8 of Article IX-B of
the Constitution, which provides:
The case at bench is not, strictly speaking, about
‘double pension.’ It is, however, about the Pensions or gratuities shall not be considered as
interpretation of a gratuity law, viz., Section 11 of additional, double, or indirect compensation.
Republic Act No. 7924 which awards separation This provision simply means that a retiree
pay to those government employees who were receiving pension or gratuity can continue to
displaced by the reorganization of the MMA into receive such pension or gratuity even if he
the MMDA, which should be construed to preclude accepts another government position to which
a government employee from receiving double another compensation is attached.
gratuity for the same years of service.
Indeed, the retirement benefits which petitioner
We affirm the assailed judgment. We agree with had received or has been receiving under R.A. No.
the Court of Appeals and the Civil Service 910, as amended, do not constitute double
Commission that for the purpose of computing or compensation. He could continue receiving the
determining petitioner’s separation pay under same even if after his retirement he had been
Section 11 of R.A. No. 7924, his years of service in receiving salary from the defunct MMA as Director
the Judiciary should be excluded and that his III thereof. This is but just because said
separation pay should be solely confined to his retirement benefits are rewards for his services as
services in the MMA. MeTC Judge, while his salary was his
In the first place, the last paragraph of Section 11 compensation for his services as Director III of the
of R.A. No. 7924 on the grant of separation pay at MMA.
the rate of “one and one-fourth (1¼) months of However, to credit his years of service in the
salary for every year of service” cannot by any Judiciary in the computation of his separation pay
stretch of logic or imagination be interpreted to under R.A. No. 7924 notwithstanding the fact that
refer to the total length of service of an MMA he had received or has been receiving the
employee in the government, i.e., to include such retirement benefits under R.A. No. 910, as
service in the government outside the MMA. amended, would be to countenance double
Since it allows the grant of separation pay to compensation for exactly the same services, i.e.,
employees who were to be displaced thereby the his services as MeTC Judge. Such would run
separation pay can be based only on the length of counter to the policy of this Court against double
service in the MMA. The displacement amounted compensation for exactly the same services. More
to an abolition of the office or position of the important, it would be in violation of the first
displaced employees, such as that of petitioner. paragraph of Section 8 of Article IX-B of the
The rule is settled that Congress may abolish Constitution, which proscribes additional, double,
public offices. Such a power is a consequent or indirect compensation. Said provision reads:
prerogative of its power to create public offices.
However, the power to abolish is subject to the No elective or appointive public officer or
condition that it be exercised in good faith. The employee shall receive additional, double, or
separation partook of the nature of a disturbance indirect compensation, unless specifically
of compensation; hence, the separation pay must authorized by law… .
relate only to the employment thus affected. Section 11 of R.A. No. 7924 does not specifically
Second, petitioner himself must have realized that authorize payment of additional compensation for
Section 11 does not allow the tacking in of his years of government service outside of the MMA.
previous government service. If he were WHEREFORE, finding no reversible error in the
convinced that it does he could have instead judgment appealed from, the petition in this case
applied for retirement benefits, since by adding is DENIED for want of merit, and the decision of
his years of service in the MMA to his previous 19 August 1999 of the Court of Appeals in CA-G.R.
years of service in the Government he could have SP No. 48301 is AFFIRMED.
retired under the third paragraph of Section 11,
which pertinently reads: Costs against petitioner.
Provided, That, if qualified for retirement under SO ORDERED.
existing retirement laws, said employee may opt Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza,
to receive the benefits thereunder. Panganiban, Quisumbing, Pardo, Buena, Gonzaga-
Third, after the approval of his optional retirement Reyes, Ynares-Santiago, and De Leon, Jr., JJ.,
on 1 April 1992, petitioner was fully paid of his concur.
retirement gratuity under R.A. No. 910, as Rollo, 31-41. Per Barcelona, R., J., with Demetria,
amended; and five years thereafter he has been D., and Gozo-Dadole, M., JJ., concurring.
receiving a monthly pension.
Not R.A. No. 901 as stated in the challenged
decision of the Court of Appeals (Rollo, 31), or
R.A. No. 601 as stated in Resolution No. 97-4266
of the Civil Service Commission (Rollo, 50 and
52). R.A. No. 910, as amended, was further
amended by R.A. No. 5095 and P.D. No. 1438.
37 SCRA 776 [1971].
Manalang v. Quitoriano, 94 Phil. 903 [1954];
Rodriguez v. Montinola, 94 Phil. 964 [1954];
Castillo v. Pajo, 103 Phil. 515 [1958]; Ulep v.
Carbonell, 4 SCRA 375 [1962]; Llanto v.
Dimaporo, 16 SCRA 599 [1966]; Canonizado v.
Aguirre, G.R. No. 133132, 25 January 2000.
Cruz v. Primicias, 23 SCRA 998 [1968];
Canonizado v. Aguirre, supra.
II JOAQUIN BERNAS, THE CONSTITUTION OF THE
REPUBLIC OF THE PHILIPPINES (A Commentary)
341 (1988 ed.).
Espejo v. Auditor General, 97 Phil. 216 [1955];
Borromeo v. GSIS, 110 Phil. 1 [1960]; Anciano v.
Otadoy, 27 SCRA 200 [1969]; Chavez v. Mathay,
supra note 3.