rule-making lecture p1

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Rule-Making Power

BASIC CONCEPTS

• Rule-making Power (Power of Subordinate Legislation)

o A power given to administrative agencies to issue or promulgate rules and regulations which

are necessary to carry out their functions

• Rules and Regulations

o

Those issued by administrative or executive officers in accordance with and as authorized bylaw, otherwise they become ultra vires

• Rationale

o Administrative agencies have:

! technical expertise/competence

! they specialize on this field; and

! they have all the time and opportunity to handle these matters exclusively

• Necessity

o In order to adapt to increasing complexity of modern life and variety of public functions

o An exception to separation of powers and non-delegation of powers

PRINCIPLE OF NON-DELEGATION OF POWERS• General Rule

o Postestas delegate non delegari potest

• Basis o The ethical principle that a delegated power constitutes not only a right but also a duty to be

performed by the delegate in the exercise of his own judgment and not through the

intervening mind of another

o Delegated Power = (Right + Duty) – Further Delegation = Negationo Further delegation of the duty consists a negation of the same

o Not only a right, otherwise it becomes discretionary to delegate it further or not

• Five Instances When Delegation of Legislative Powers Is Allowed

o

Delegation of tariff powers to the Presidento Delegation of emergency powers to the President

o Delegation to the people at large

o Delegation to local governments

o Delegation to administrative bodies

KMU vs GARCIA

G.R. No. 115381 December 23, 1994

FACTS: Secretary of DOTC, Oscar M. Orbos, issued Memorandum Circular No. 90-395 to then LTFRB

Chairman, Remedios A.S. Fernando allowing provincial bus operators to charge passengers rates within arange of 15% above and 15% below the LTFRB official rate for a period of one (1) year. Finding the

implementation of the fare range scheme "not legally feasible," Remedios A.S. Fernando submitted amemorandum to Orbos that the implementation of the proposed fare range scheme be further studied and

evaluated because it is contrary to Section 16(c) of the Public Service Act (prescribes the following for

the fixing and determination of rates — (a) the rates to be approved should be proposed by public service

operators; (b) there should be a publication and notice to concerned or affected parties in the territoryaffected; (c) a public hearing should be held for the fixing of the rates; hence, implementation of the

proposed fare range scheme on August 6 without complying with the requirements of the Public Service

Act may not be legally feasible) and To allow bus operators in the country to charge fares fifteen (15%)

above the present LTFRB fares in the wake of the devastation, death and suffering caused by the July 16

earthquake will not be socially warranted and will be politically unsound;


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Provincial Bus Operators Association of the Philippines, Inc. (PBOAP) filed an application for fare rate

increase. Later, PBOAP reduced its applied proposed fare. The decrease was due to the drop in the

expected price of diesel. The application was opposed by the Philippine Consumers Foundation, Inc. and

Perla C. Bautista alleging that the proposed rates were exorbitant and unreasonable and that the

application contained no allegation on the rate of return of the proposed increase in rates.

LTFRB rendered a decision granting the fare rate increase. Secretary of the Department of Transportation

and Communications Pete Nicomedes Prado issued DO No. 92-587 defining the policy framework on the

regulation of transport services.

The LTFRB issued Memorandum CircularNo. 92-009 promulgating the guidelines for the implementation

of DOTC DO No. 92-587. The Circular provides, among others

A. On the General Structure of Rates 1. The existing authorized fare range system of plus or minus

15 per cent for provincial buses and jeepneys shall be widened to 20% and -25% limit in 1994 with the

authorized fare to be replaced by an indicative or reference rate as the basis for the expanded fare range.

Sometime in March, 1994, private respondent PBOAP, availing itself of the deregulation policy of the

DOTC allowing provincial bus operators to collect plus 20% and minus 25% of the prescribed farewithout first having filed a petition for the purpose and without the benefit of a public hearing, announced

a fare increase of twenty (20%) percent of the existing fares. Said increased fares were to be made

effective on March 16, 1994.

On March 16, 1994, petitioner KMU filed a petition before the LTFRB opposing the upward adjustment

of bus fares. On March 24, 1994, the LTFRB issued one of the assailed orders dismissing the petition for

lack of merit. Hence, the instant petition for certiorari with an urgent prayer for issuance of a temporaryrestraining order. The Court, on June 20, 1994, issued a temporary restraining order enjoining, prohibiting

and preventing respondents from implementing the bus fare rate increase as well as the questioned orders

and memorandum circulars.

Petitioner KMU anchors its claim on two (2) grounds. First, the authority given by respondent LTFRB to

provincial bus operators to set a fare range of plus or minus fifteen (15%) percent, later increased to plus

twenty (20%) and minus twenty-five (-25%) percent, over and above the existing authorized fare without

having to file a petition for the purpose, is unconstitutional, invalid and illegal. Second, the establishment

of a presumption of public need in favor of an applicant for a proposed transport service without having to

prove public necessity, is illegal for being violative of the Public Service Act and the Rules of Court.

HELD:

1. WON KMU HAS THE LEGAL STANDING TO SUE.

In the case at bench, petitioner, whose members had suffered and continue to suffer grave and irreparable

injury and damage from the implementation of the questioned memoranda, circulars and/or orders, hasshown that it has a clear legal right that was violated and continues to be violated with the enforcement of

the challenged memoranda, circulars and/or orders. KMU members, who avail of the use of buses, trains

and jeepneys everyday, are directly affected by the burdensome cost of arbitrary increase in passenger

fares. They are part of the millions of commuters who comprise the riding public. Certainly, their rights

must be protected, not neglected nor ignored.

Assuming arguendo that petitioner is not possessed of the standing to sue, this court is ready to brush

aside this barren procedural infirmity and recognize the legal standing of the petitioner in view of the

transcendental importance of the issues raised.

2. WON LTFRB MAY VALIDLY DELEGATE ITS AUTHORITY TO PRESCRIBE FARE RATES TO

CC/OPERATOR

Section 16(c) of the Public Service ACT: Proceedings of the Commission, upon notice and hearing. —


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The Commission shall have power, upon proper notice and hearing in accordance with the rules and

provisions of this Act, subject to the limitations and exceptions mentioned and saving provisions to the

contrary:

(c) To fix and determine individual or joint rates, tolls, charges, classifications, or schedules thereof,

as well as commutation, mileage kilometrage, and other special rates which shall be imposed, observed,

and followed thereafter by any public service: Provided , That the Commission may, in its discretion,

approve rates proposed by public services provisionally and without necessity of any hearing; but it shall

call a hearing thereon within thirty days thereafter, upon publication and notice to the concerns operating

in the territory affected: Provided, further, That in case the public service equipment of an operator isused principally or secondarily for the promotion of a private business, the net profits of said private

business shall be considered in relation with the public service of such operator for the purpose of fixing

the rates. (Emphasis ours).

Under the foregoing provision, the Legislature delegated to the defunct Public Service Commission the

power of fixing the rates of public services. Respondent LTFRB, the existing regulatory body today, is

likewise vested with the same under Executive Order No. 202 dated June 19, 1987. Section 5(c) of the

said executive order authorizes LTFRB "to determine, prescribe, approve and periodically review and

adjust, reasonable fares, rates and other related charges, relative to the operation of public landtransportation services provided by motorized vehicles."

Such delegation of legislative power to an administrative agency is permitted in order to adapt to theincreasing complexity of modern life. As subjects for governmental regulation multiply, so does the

difficulty of administering the laws. Hence, specialization even in legislation has become necessary.

Given the task of determining sensitive and delicate matters as route-fixing and rate-making for the

transport sector, the responsible regulatory body is entrusted with the power of subordinate legislation.With this authority, an administrative body and in this case, the LTFRB, may implement broad policies

laid down in a statute by "filling in" the details which the Legislature may neither have time or

competence to provide. However, nowhere under the aforesaid provisions of law are the regulatory

bodies, the PSC and LTFRB alike, authorized to delegate that power to a common carrier, a transportoperator, or other public service.

In the case at bench, the authority given by the LTFRB to the provincial bus operators to set a fare range

over and above the authorized existing fare, is illegal and invalid as it is tantamount to an undue

delegation of legislative authority. Potestas delegata non delegari potest . What has been delegated cannot

be delegated. This doctrine is based on the ethical principle that such a delegated power constitutes not

only a right but a duty to be performed by the delegate through the instrumentality of his own judgment

and not through the intervening mind of another. 10 A further delegation of such power would indeed

constitute a negation of the duty in violation of the trust reposed in the delegate mandated to discharge it

directly. 11

The policy of allowing the provincial bus operators to change and increase their fares at will would result

not only to a chaotic situation but to an anarchic state of affairs. This would leave the riding public at the

mercy of transport operators who may increase fares every hour, every day, every month or every year,

whenever it pleases them or whenever they deem it "necessary" to do so. One veritable consequence of

the deregulation of transport fares is a compounded fare. If transport operators will be authorized to

impose and collect an additional amount equivalent to 20% over and above the authorized fare over a

period of time, this will unduly prejudice a commuter who will be made to pay a fare that has been

computed in a manner similar to those of compounded bank interest rates.

Moreover, rate making or rate fixing is not an easy task. It is a delicate and sensitive government function

that requires dexterity of judgment and sound discretion with the settled goal of arriving at a just and

reasonable rate acceptable to both the public utility and the public. Several factors, in fact, have to be


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taken into consideration before a balance could be achieved. A rate should not be confiscatory as would

place an operator in a situation where he will continue to operate at a loss. Hence, the rate should enable

public utilities to generate revenues sufficient to cover operational costs and provide reasonable return on

the investments. On the other hand, a rate which is too high becomes discriminatory. It is contrary to

public interest. A rate, therefore, must be reasonable and fair and must be affordable to the end user who

will utilize the services.

Given the complexity of the nature of the function of rate-fixing and its far-reaching effects on millions of

commuters, government must not relinquish this important function in favor of those who would benefit

and profit from the industry. Neither should the requisite notice and hearing be done away with. Thepeople, represented by reputable oppositors, deserve to be given full opportunity to be heard in their

opposition to any fare increase.

3. ON THE PRESUMPTION OF PUBLIC NEEDA certificate of public convenience (CPC) is an authorization granted by the LTFRB for the operation of

land transportation services for public use as required by law. Pursuant to Section 16(a) of the Public

Service Act, as amended, the following requirements must be met before a CPC may be granted, to wit:

(i) the applicant must be a citizen of the Philippines, or a corporation or co-partnership, association or

joint-stock company constituted and organized under the laws of the Philippines, at least 60 per centum ofits stock or paid-up capital must belong entirely to citizens of the Philippines; (ii) the applicant must be

financially capable of undertaking the proposed service and meeting the responsibilities incident to its

operation; and (iii) the applicant must prove that the operation of the public service proposed and the

authorization to do business will promote the public interest in a proper and suitable manner . It is

understood that there must be proper notice and hearing before the PSC can exercise its power to issue a

CPC. On the contrary, the policy guideline states that the presumption of public need for a public service

shall be deemed in favor of the applicant. In case of conflict between a statute and an administrative order,the former must prevail.

By its terms, public convenience or necessity generally means something fitting or suited to the public

need. 16

As one of the basic requirements for the grant of a CPC, public convenience and necessity existswhen the proposed facility or service meets a reasonable want of the public and supply a need which the

existing facilities do not adequately supply. The existence or non-existence of public convenience and

necessity is therefore a question of fact that must be established by evidence, real and/or testimonial;

empirical data; statistics and such other means necessary, in a public hearing conducted for that purpose.

The object and purpose of such procedure, among other things, is to look out for, and protect, the interests

of both the public and the existing transport operators.

Verily, the power of a regulatory body to issue a CPC is founded on the condition that after full-dress

hearing and investigation, it shall find, as a fact, that the proposed operation is for the convenience of the

public. 17 Basic convenience is the primary consideration for which a CPC is issued, and that fact alone

must be consistently borne in mind. Also, existing operators in subject routes must be given anopportunity to offer proof and oppose the application. Therefore, an applicant must, at all times, be

required to prove his capacity and capability to furnish the service which he has undertaken to

render. 18 And all this will be possible only if a public hearing were conducted for that purpose.

Otherwise stated, the establishment of public need in favor of an applicant reverses well-settled and

institutionalized judicial, quasi-judicial and administrative procedures. It allows the party who initiates the

proceedings to prove, by mere application, his affirmative allegations. Moreover, the offending provisions

of the LTFRB memorandum circular in question would in effect amend the Rules of Court by adding

another disputable presumption in the enumeration of 37 presumptions under Rule 131, Section 5 of the

Rules of Court. Such usurpation of this Court's authority cannot be countenanced as only this Court is

mandated by law to promulgate rules concerning pleading, practice and procedure.


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Deregulation, while it may be ideal in certain situations, may not be ideal at all in our country given the

present circumstances. Advocacy of liberalized franchising and regulatory process is tantamount to an

abdication by the government of its inherent right to exercise police power, that is, the right of

government to regulate public utilities for protection of the public and the utilities themselves.

THREE ISSUES ON RULE-MAKING POWER

• Permissibility of Delegation

o WON there is:

! Legislative grant of authority

! To administrative bodies

! To issue rules and regulations

o Instances of Valid Delegation

! Delegation of tariff powers to the President – Sec 28(2), Art VI

! Delegation of emergency powers to the President – Sec 23(2), Art VI

! Delegation to the people at large – Sec 32, Art VI

!

Delegation to local governments – Sec 3, Art X! Delegation to administrative bodies – by legislative act (enabling law) or by necessary

implication

PASEI vs TORRES

G.R. No. 101279 August 6, 1992

FACTS:

PASEI is the largest national organization of private employment and recruitment agencies duly licensed

and authorized by the POEA, to engaged in the business of obtaining overseas employment for Filipinolandbased workers, including domestic helpers.

As a result of published stories regarding the abuses suffered by Filipino housemaids employed in HongKong, DOLE Secretary Ruben D. Torres issued Department Order No. 16 temporarily suspending the

recruitment by private employment agencies of "Filipino domestic helpers going to Hong Kong". The

DOLE itself, through the POEA took over the business of deploying such Hong Kong-bound workers.

Pursuant to the above DOLE circular, the POEA issued Memorandum Circular No. 30 providing

GUIDELINES on the Government processing and deployment of Filipino domestic helpers to Hong Kong

and the accreditation of Hong Kong recruitment agencies intending to hire Filipino domestic helpers. The

POEA Administrator also issued Memorandum Circular No. 37, Series of 1991, on the processing of

employment contracts of domestic workers for Hong Kong.

Petitioner, PASEI, filed this petition for prohibition to annul the aforementioned DOLE and POEA circulars

and to prohibit their implementation for the following reasons:

1. that the respondents acted with grave abuse of discretion and/or in excess of their rule-making authority

in issuing said circulars;

2. that the assailed DOLE and POEA circulars are contrary to the Constitution, are unreasonable, unfair

and oppressive; and

3. that the requirements of publication and filing with the Office of the National Administrative Register

were not complied with.

HELD:There is no merit in the first and second grounds of the petition.


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Article 36 of the Labor Code grants the Labor Secretary the power to restrict and regulate recruitment and

placement activities and the power to issue orders and promulgate rules and regulations. Also, the scope of

the regulatory authority of the POEA, which was created by Executive Order No. 797 to take over the

functions of the Overseas Employment Development Board, the National Seamen Board, and the overseas

employment functions of the Bureau of Employment Services includes among others the power and duty:

"2. To establish and maintain a registration and/or licensing system to regulate private sector participation

in the recruitment and placement of workers, locally and overseas , . . ." (Art. 15, Labor Code, Emphasis

supplied).

The vesture of quasi-legislative and quasi-judicial powers in administrative bodies is not unconstitutional,

unreasonable and oppressive. It has been necessitated by "the growing complexity of the modern society" .

More and more administrative bodies are necessary to help in the regulation of society's ramified activities.

"Specialized in the particular field assigned to them, they can deal with the problems thereof with moreexpertise and dispatch than can be expected from the legislature or the courts of justice"

The assailed circulars do not prohibit the petitioner from engaging in the recruitment and deployment of

Filipino landbased workers for overseas employment. A careful reading of the challenged administrative

issuances discloses that the same fall within the "administrative and policing powers expressly or bynecessary implication conferred" upon the respondents. The power to "restrict and regulate conferred by

Article 36 of the Labor Code involves a grant of police power. To "restrict" means "to confine, limit or stop"

and whereas the power to "regulate" means "the power to protect, foster, promote, preserve, and control withdue regard for the interests, first and foremost, of the public, then of the utility and of its patrons"

The Solicitor General, in his Comment, aptly observed: Said Administrative Order merely restricted the

scope or area of petitioner's business operations by excluding therefrom recruitment and deployment ofdomestic helpers for Hong Kong till after the establishment of the "mechanisms" that will enhance the

protection of Filipino domestic helpers going to Hong Kong. They are reasonable, valid and justified under

the general welfare clause of the Constitution, since the recruitment and deployment business, as it is

conducted today, is affected with public interest.

The questioned circulars are therefore a valid exercise of the police power as delegated to the executive

branch of Government.

Nevertheless, they are legally invalid, defective and unenforceable for lack of power publication and filing

in the Office of the National Administrative Register as required in Article 2 of the Civil Code, Article 5 of

the Labor Code and Sections 3(1) and 4, Chapter 2, Book VII of the Administrative Code of 1987 which

provide: Art. 2. Laws shall take effect after fifteen (15) days following the completion of their publication in

the Official Gazatte, unless it is otherwise provided. . . . (Civil Code.)

Art. 5. Rules and Regulations. — The Department of Labor and other government agencies charged with theadministration and enforcement of this Code or any of its parts shall promulgate the necessary implementing

rules and regulations. Such rules and regulations shall become effective fifteen (15) daysafter announcement

of their adoption in newspapers of general circulation. (Emphasis supplied, Labor Code, as amended.)

Sec. 3. Filing. — (1) Every agency shall file with the University of the Philippines Law Center, three (3)

certified copies of every rule adopted by it . Rules in force on the date of effectivity of this Code which are

not filed within three (3) months shall not thereafter be the basis of any sanction against any party or

persons. (Emphasis supplied, Chapter 2, Book VII of the Administrative Code of 1987.)

Sec. 4. Effectivity. — In addition to other rule-making requirements provided by law not inconsistent with

this Book, each rule shall become effective fifteen (15) days from the date of filing as above provided unless

a different date is fixed by law, or specified in the rule in cases of imminent danger to public health, safety


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and welfare, the existence of which must be expressed in a statement accompanying the rule. The agency

shall take appropriate measures to make emergency rules known to persons who may be affected by them.

(Emphasis supplied, Chapter 2, Book VII of the Administrative Code of 1987).

In Tañada vs. Tuvera, 146 SCRA 446 that:

. . . Administrative rules and regulations must also be published if their purpose is to enforce or

implement existing law pursuant also to a valid delegation. (p. 447.)

Interpretative regulations and those merely internal in nature, that is, regulating only the personnel of the

administrative agency and not the public, need not be published. Neither is publication required of the so-called letters of instructions issued by administrative superiors concerning the rules or guidelines to be

followed by their subordinates in the performance of their duties. (p. 448.)

For lack of proper publication, the administrative circulars in question may not be enforced andimplemented.

The implementation of DOLE Department Order No. 16, Series of 1991, and POEA Memorandum Circulars

Nos. 30 and 37, Series of 1991, by the public respondents is hereby SUSPENDED pending compliance with

the statutory requirements of publication and filing under the aforementioned laws of the land.

SANTIAGO vs COMELEC

G.R. No. 127325. March 19, 1997

FACTS:

Atty. Jesus S. Delfin, a founding member of the Movement for Peoples Initiative, filed with COMELEC a

Petition to Amend the Constitution, to Lift Term Limits of Elective Officials, by Peoples Initiative wherein

Delfin asked the COMELEC for an order 1. Fixing the time and dates for signature gathering all over the

country; 2. Causing the necessary publications of said Order and the attached Petition for Initiative on the

1987 Constitution, in newspapers of general and local circulation; 3. Instructing Municipal Election

Registrars in all Regions of the Philippines, to assist Petitioners and volunteers, in establishing signing

stations at the time and on the dates designated for the purpose as required in COMELEC Resolution No.2300,

Delfin Petition further alleged that the provisions sought to be amended are Sections 4 and 7 of Article

VI,[7] Section 4 of Article VII,[8] and Section 8 of Article X[9]of the Constitution. Attached to the petition is a

copy of a Petition for Initiative on the 1987 Constitution embodying the proposed amendments which

consist in the deletion from the aforecited sections of the provisions concerning term limits, and with the

following proposition: DO YOU APPROVE OF LIFTING THE TERM LIMITS OF ALL ELECTIVE

GOVERNMENT OFFICIALS, AMENDING FOR THE PURPOSE SECTIONS 4 AND 7 OF ARTICLE

VI, SECTION 4 OF ARTICLE VII, AND SECTION 8 OF ARTICLE X OF THE 1987 PHILIPPINE

CONSTITUTION?

The COMELEC, through its Chairman, issued an Order (a) directing Delfin to cause the publication of the

petition, together with the attached Petition for Initiative on the 1987 Constitution (including the proposal,

proposed constitutional amendment, and the signature form), and the notice of hearing in (3) daily

newspapers of general circulation at his own expense and (b) setting the case for hearing.

Senator Roco filed a Motion to Dismiss the Delfin Petition on the ground that it is not the initiatory petition

properly cognizable by the COMELEC. After hearing their arguments, the COMELEC directed Delfin and

the oppositors to file their memoranda and/or oppositions/memoranda within five days.

Petitioners herein, Senator Miriam Defensor Santiago, Alexander Padilla, and Maria Isabel Ongpin -- filedthis special civil action for prohibition raising the following arguments:


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(1) The constitutional provision on peoples initiative to amend the Constitution can only be implemented

by law to be passed by Congress. No such law has been passed; in fact, Senate Bill No. 1290 entitled An Act

Prescribing and Regulating Constitutional Amendments by Peoples Initiative, which petitioner Senator

Santiago filed on 24 November 1995, is still pending before the Senate Committee on Constitutional

Amendments.

(2) It is true that R.A. No. 6735 provides for three systems of initiative, namely, initiative on the

Constitution, on statutes, and on local legislation. However, it failed to provide any subtitle on initiative on

the Constitution, unlike in the other modes of initiative, which are specifically provided for in Subtitle II and

Subtitle III. This deliberate omission indicates that the matter of peoples initiative to amend the Constitution

was left to some future law.(3) Republic Act No. 6735 provides for the effectivity of the law after publication in print media. This

indicates that the Act covers only laws and not constitutional amendments because the latter take effect only

upon ratification and not after publication.

(4) COMELEC Resolution No. 2300 to govern the conduct of initiative on the Constitution and initiativeand referendum on national and local laws, is ultra vires insofar as initiative on amendments to the

Constitution is concerned, since the COMELEC has no power to provide rules and regulations for the

exercise of the right of initiative to amend the Constitution. Only Congress is authorized by the Constitution

to pass the implementing law.

(5)The peoples initiative is limited to amendments to the Constitution, not to revision thereof. Extendingor lifting of term limits constitutes a revision and is, therefore, outside the power of the peoples initiative.

(6) Finally, Congress has not yet appropriated funds for peoples initiative; neither the COMELEC nor

any other government department, agency, or office has realigned funds for the purpose.

Delfin maintains as follows:

(1) Contrary to the claim of the petitioners, there is a law, R.A. No. 6735, which governs the conduct

of initiative to amend the Constitution. The absence therein of a subtitle for such initiative is not fatal, sincesubtitles are not requirements for the validity or sufficiency of laws.

(2) Section 9(b) of R.A. No. 6735 specifically provides that the proposition in an initiative to amend the

Constitution approved by the majority of the votes cast in the plebiscite shall become effective as of the day

of the plebiscite.(3) The claim that COMELEC Resolution No. 2300 is ultra vires is contradicted by (a) Section 2, Article

IX-C of the Constitution, which grants the COMELEC the power to enforce and administer all laws and

regulations relative to the conduct of an election, plebiscite, initiative, referendum, and recall; and (b)

Section 20 of R.A. 6735, which empowers the COMELEC to promulgate such rules and regulations as may

be necessary to carry out the purposes of the Act.

(4) The proposed initiative does not involve a revision of, but mere amendment to, the Constitution

because it seeks to alter only a few specific provisions of the Constitution, or more specifically, only those

which lay term limits. It does not seek to reexamine or overhaul the entire document.

The Demokrasya-Ipagtanggol ang Konstitusyon (DIK) and the Movement of Attorneys for Brotherhood

Integrity and Nationalism, Inc. (MABINI), filed a Motion for Intervention:(1) The Delfin proposal does not involve a mere amendment to, but a revision of, the Constitution

because, in the words of Fr. Joaquin Bernas, S.J., [18] it would involve a change from a political philosophy

that rejects unlimited tenure to one that accepts unlimited tenure;

(2) The prohibition against reelection of the President and the limits provided for all other national and

local elective officials are based on the philosophy of governance, to open up the political arena to as many

as there are Filipinos qualified to handle the demands of leadership, to break the concentration of political

and economic powers in the hands of a few, and to promote effective proper empowerment for participation

in policy and decision-making for the common good; hence, to remove the term limits is to negate and

nullify the noble vision of the 1987 Constitution.

(4) R.A. No. 6735 is deficient and inadequate in itself to be called the enabling law that implements the

peoples initiative on amendments to the Constitution. Accordingly, there being no enabling law, the

COMELEC has no jurisdiction to hear Delfins petition.


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(5) The deficiency of R.A. No. 6735 cannot be rectified or remedied by COMELEC Resolution No. 2300,

since the COMELEC is without authority to legislate the procedure for a peoplesinitiative under Section 2 of

Article XVII of the Constitution. That function exclusively pertains to Congress. Section 20 of R.A. No.

6735 does not constitute a legal basis for the Resolution, as the former does not set a sufficient standard for a

valid delegation of power.

Senator Raul Roco filed his Petition in Intervention. He avers that R.A. No. 6735 is the enabling law that

implements the peoples right to initiate constitutional amendments. Nevertheless, he contends that the

respondent Commission is without jurisdiction to take cognizance of the Delfin Petition and to order its

publication because the said petition is not the initiatory pleading contemplated under the Constitution,Republic Act No. 6735, and COMELEC Resolution No. 2300. What vests jurisdiction upon the COMELEC

in an initiative on the Constitution is the filing of a petition for initiative which is signed by the required

number of registered voters.

LABAN filed a Motion for Leave to Intervene.

The IBP filed a Motion for Intervention to which it attached a Petition in Intervention raising the following

arguments:

(1) Congress has failed to enact an enabling law mandated under Section 2, Article XVII of the 1987Constitution.

(2) COMELEC Resolution No. 2300 cannot substitute for the required implementing law on the initiative

to amend the Constitution.(3) The Petition for Initiative suffers from a fatal defect in that it does not have the required number of

signatures.

(4) The petition seeks, in effect a revision of the Constitution, which can be proposed only by Congress or

a constitutional convention.

ISSUES:

1. Whether R.A. No. 6735, entitled An Act Providing for a System of Initiative and Referendum and

Appropriating Funds Therefor, was intended to include or cover initiative1 on amendments to theConstitution; and if so, whether the Act, as worded, adequately covers such initiative.

2. Whether that portion of COMELEC Resolution No. 2300 (In re: Rules and Regulations Governing the

Conduct of Initiative on the Constitution, and Initiative and Referendum on National and Local Laws)

regarding the conduct of initiative on amendments to the Constitution is valid, considering the absence in the

law of specific provisions on the conduct of such initiative.

3. Whether the COMELEC can take cognizance of, or has jurisdiction over, a petition solely intended to

obtain an order (a) fixing the time and dates for signature gathering; (b) instructing municipal election

officers to assist Delfin's movement and volunteers in establishing signature stations; and (c) directing or

causing the publication of, inter alia, the unsigned proposed Petition for Initiative on the 1987 Constitution.

HELD:

1. NO. While R.A. No. 6735 exerted utmost diligence and care in providing for the details in the

implementation of initiative and referendum on national and local legislation thereby giving them special

attention, it failed, rather intentionally, to do so on the system of initiative on amendments to the

Constitution. R.A. No. 6735, in all of its twenty-three sections, merely (a) mentions, the word Constitution

in Section 2; (b) defines initiative on the Constitution and includes it in the enumeration of the three systems

of initiative in Section 3; (c) speaks of plebiscite as the process by which the proposition in an initiative on

the Constitution may be approved or rejected by the people; (d) reiterates the constitutional requirements as

to the number of voters who should sign the petition; and (e) provides for the date of effectivity of the


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approved proposition.

The foregoing brings us to the conclusion that R.A. No. 6735 is incomplete, inadequate, or wanting in

essential terms and conditions insofar as initiative on amendments to the Constitution is concerned. Its

lacunae on this substantive matter are fatal and cannot be cured by empowering the COMELEC to

promulgate such rules and regulations as may be necessary to carry out the purposes of [the] Act.

The rule is that what has been delegated, cannot be delegated or as expressed in a Latin maxim: potestas

delegata non delegari potest .[59] The recognized exceptions to the rule are as follows:

(1) Delegation of tariff powers to the President under Section 28(2) of Article VI of the Constitution;(2) Delegation of emergency powers to the President under Section 23(2) of Article VI of the Constitution;

(3) Delegation to the people at large;

(4) Delegation to local governments; and

(5) Delegation to administrative bodies.[60]

Empowering the COMELEC, an administrative body exercising quasi-judicial functions, to promulgate

rules and regulations is a form of delegation of legislative authority under no. 5 above. However, in every

case of permissible delegation, there must be a showing that the delegation itself is valid. It is valid only if

the law (a) is complete in itself, setting forth therein the policy to be executed, carried out, or implementedby the delegate; and (b) fixes a standard -- the limits of which are sufficiently determinate and determinable

-- to which the delegate must conform in the performance of his functions. A sufficient standard is one

which defines legislative policy, marks its limits, maps out its boundaries and specifies the public agency toapply it. It indicates the circumstances under which the legislative command is to be effected.[62]

Insofar as initiative to propose amendments to the Constitution is concerned, R.A. No. 6735 miserably failed

to satisfy both requirements in subordinate legislation. The delegation of the power to the COMELEC isthen invalid.

COMELEC RESOLUTION NO. 2300, INSOFAR AS IT PRESCRIBES RULES AND

REGULATIONS ON THE CONDUCT OF INITIATIVE ON AMENDMENTS TO THECONSTITUTION, IS VOID.

It logically follows that the COMELEC cannot validly promulgate rules and regulations to implement the

exercise of the right of the people to directly propose amendments to the Constitution through the system of

initiative. It does not have that power under R.A. No. 6735. Reliance on the COMELECs power under

Section 2(1) of Article IX-C of the Constitution is misplaced, for the laws and regulations referred to therein

are those promulgated by the COMELEC under (a) Section 3 of Article IX-C of the Constitution, or (b) a

law where subordinate legislation is authorized and which satisfies the completeness and the sufficient

standard tests.

COMELEC ACTED WITHOUT JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION IN

ENTERTAINING THE DELFIN PETITION.Even if it be conceded ex gratia that R.A. No. 6735 is a full compliance with the power of Congress to

implement the right to initiate constitutional amendments, or that it has validly vested upon the COMELEC

the power of subordinate legislation and that COMELEC Resolution No. 2300 is valid, the COMELEC

acted without jurisdiction or with grave abuse of discretion in entertaining the Delfin Petition.

Under Section 2 of Article XVII of the Constitution and Section 5(b) of R.A. No. 6735, a petition for

initiative on the Constitution must be signed by at least 12% of the total number of registered voters of

which every legislative district is represented by at least 3% of the registered voters therein. The Delfin

Petition does not contain signatures of the required number of voters. Delfin himself admits that he has not

yet gathered signatures and that the purpose of his petition is primarily to obtain assistance in his drive to

gather signatures. Without the required signatures, the petition cannot be deemed validly initiated.


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The COMELEC acquires jurisdiction over a petition for initiative only after its filing. The petition then is

the initiatory pleading. Nothing before its filing is cognizable by the COMELEC, sitting en banc. The only

participation of the COMELEC or its personnel before the filing of such petition are (1) to prescribe the

form of the petition;[63] (2) to issue through its Election Records and Statistics Office a certificate on the total

number of registered voters in each legislative district;[64] (3) to assist, through its election registrars, in the

establishment of signature stations;[65] and (4) to verify, through its election registrars, the signatures on the

basis of the registry list of voters, voters affidavits, and voters identification cards used in the immediately

preceding election.[66]

Since the Delfin Petition is not the initiatory petition under R.A. No. 6735 and COMELEC Resolution No.2300, it cannot be entertained or given cognizance of by the COMELEC.

• Validity of Delegation

o WON the grant meets the:

! Completeness test

• A statute is complete when it leaves the legislature (the subject and the manner

and the extent of its operation are stated in it) such that when it reaches the

delegate, the only thing he will have to do is to enforce it

•

Whether the provision is sufficiently definite and certain to enable one toknow his rights and obligations thereunder

US vs ANG TANG HO

G.R. No. 17122 February 27, 1922

FACTS:

The Philippine Legislature passed Act No. 2868, entitled "An Act penalizing the monopoly and holding of,

and speculation in, palay, rice, and corn under extraordinary circumstances, regulating the distribution andsale thereof, and authorizing the Governor-General, with the consent of the Council of State, to issue the

necessary rules and regulations therefor”. Section 1 authorizes the Governor-General, with the consent of

the Council of State, for any cause resulting in an extraordinary rise in the price of palay, rice or corn, toissue and promulgate temporary rules and emergency measures for carrying out the purposes of the Act.Section 3 defines what shall constitute a monopoly or hoarding of palay, rice or corn within the meaning of

this Act, but does not specify the price of rice or define any basic for fixing the price.

The Governor-General issued a proclamation fixing the price at which rice should be sold. A complaint was

filed against the defendant, Ang Tang Ho, charging him with the sale of rice at an excessive price (one ganta

of rice at P.80).Upon this charge, he was tried, found guilty and sentenced to five months' imprisonment and

to pay a fine of P500.

He filed an appealed to the SC claiming that the lower court erred in finding Executive Order No. 53 of1919, to be of any force and effect, in finding the accused guilty of the offense charged, and in imposing the

sentence.

*The Act was to take effect on its approval (July 30, 1919) that the Governor-General issued his

proclamation on August 1, 1919; the law was first published on the 13th of August, 1919; and that the

proclamation itself was first published on the 20th of August, 1919.

ISSUE: WON Act No. 2868, in so far as it authorizes the Governor-General to fix the price at which rice

should be sold is valid.

HELD: NOIf Act no 2868 is a law unto itself and within itself, and it does nothing more than to authorize the Governor-


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General to make rules and regulations to carry the law into effect, then the Legislature itself created the law.

There is no delegation of power and it is valid. On the other hand, if the Act within itself does not define

crime, and is not a law, and some legislative act remains to be done to make it a law or a crime, the doing of

which is vested in the Governor-General, then the Act is a delegation of legislative power, is

unconstitutional and void.

A law must be complete, in all its terms and provisions, when it leaves the legislative branch of the

government, and nothing must be left to the judgment of the electors or other appointee or delegate of the

legislature, so that, in form and substance, it is a law in all its details in presenti, but which may be left to

take effect in futuro, if necessary, upon the ascertainment of any prescribed fact or event.

*When Act No. 2868 is analyzed, it is the violation of the proclamation of the Governor-General which

constitutes the crime. Without that proclamation, it was no crime to sell rice at any price. In other words, the

Legislature left it to the sole discretion of the Governor-General to say what was and what was not "anycause" for enforcing the act, and what was and what was not "an extraordinary rise in the price of palay, rice

or corn," and under certain undefined conditions to fix the price at which rice should be sold, without regard

to grade or quality, also to say whether a proclamation should be issued, if so, when, and whether or not the

law should be enforced, how long it should be enforced, and when the law should be suspended. The

Legislature did not specify or define what was "any cause," or what was "an extraordinary rise in the priceof rice, palay or corn," Neither did it specify or define the conditions upon which the proclamation should be

issued.

In the absence of the proclamation no crime was committed. The alleged sale was made a crime, if at all,

because the Governor-General issued the proclamation. The act or proclamation does not say anything about

the different grades or qualities of rice, and the defendant is charged with the sale "of one ganta of rice at the

price of eighty centavos (P0.80) which is a price greater than that fixed by Executive order No. 53."

Act No. 2868, in so far as it undertakes to authorized the Governor-General in his discretion to issue a

proclamation, fixing the price of rice, and to make the sale of rice in violation of the price of rice, and to

make the sale of rice in violation of the proclamation a crime, is unconstitutional and void.

The law says that the Governor-General may fix "the maximum sale price that the industrial or merchant

may demand." The law is a general law and not a local or special law. The proclamation undertakes to fix

one price for rice in Manila and other and different prices in other and different provinces in the Philippine

Islands, and delegates the power to determine the other and different prices to provincial treasurers and their

deputies. Here, then, you would have a delegation of legislative power to the Governor-General, and a

delegation by him of that power to provincial treasurers and their deputies, who "are hereby directed to

communicate with, and execute all instructions emanating from the Director of Commerce and Industry, for

the most effective and proper enforcement of the above regulations in their respective localities." The

issuance of the proclamation by the Governor-General was the exercise of the delegation of a delegated

power, and was even a sub delegation of that power.

Assuming that it is valid, Act No. 2868 is a general law and does not authorize the Governor-General to fix

one price of rice in Manila and another price in Iloilo. It only purports to authorize him to fix the price of

rice in the Philippine Islands under a law, which is General and uniform, and not local or special. Under the

terms of the law, the price of rice fixed in the proclamation must be the same all over the Islands. Again, it

will be noted that the law is confined to palay, rice and corn. They are products of the Philippine Islands.

Hemp, tobacco, coconut, chickens, eggs, and many other things are also products. Any law which single out

palay, rice or corn from the numerous other products of the Islands is not general or uniform, but is a local

or special law. If such a law is valid, then by the same principle, the Governor-General could be authorized

by proclamation to fix the price of meat, eggs, chickens, coconut, hemp, and tobacco, or any other product

of the Islands. In the very nature of things, all of that class of laws should be general and uniform.

Otherwise, there would be an unjust discrimination of property rights, which, under the law, must be equal


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and inform. Act No. 2868 is nothing more than a floating law, which, in the discretion and by a

proclamation of the Governor-General, makes it a floating crime to sell rice at a price in excess of the

proclamation, without regard to grade or quality.

By the terms of the Organic Act, subject only to constitutional limitations, the power to legislate and enact

laws is vested exclusively in the Legislative, which is elected by a direct vote of the people of the Philippine

Islands. As to the question here involved, the authority of the Governor-General to fix the maximum price at

which palay, rice and corn may be sold in the manner power in violation of the organic law.

The judgment of the lower court is reversed, and the defendant discharged. So ordered.

! Sufficient standard test

• There must be adequate guidelines or limitations in the law to map out the

boundaries of the delegate’s authority and prevent the delegation from riot

YNOT vs IAC

G.R. No. 74457 March 20, 1987

FACTS:

Pres. Marcos issued Executive Order No. 626-A prohibiting the interprovincial movement of carabaos andthe slaughtering of carabaos. The carabao or carabeef transported in violation of this Executive Order shall

be subject to confiscation and forfeiture by the government, to be distributed to charitable institutions and

other similar institutions as the Chairman of the National Meat Inspection Commission may ay see fit, in the

case of carabeef, and to deserving farmers through dispersal as the Director of Animal Industry may see fit,in the case of carabaos.

The petitioner had transported six carabaos in a pump boat from Masbate to Iloilo when they were

confiscated by the police station commander of Barotac Nuevo, Iloilo, for violation of the abovemeasure. The petitioner sued for recovery, and the Regional Trial Court of Iloilo City issued a writ

of replevin upon his filing of a supersedeas bond of P12,000.00.

The RTC sustained the confiscation of the carabaos and, since they could no longer be produced, ordered the

confiscation of the bond. The court also declined to rule on the constitutionality of the executive order, as

raise by the petitioner, for lack of authority and also for its presumed validity. 2

The IAC upheld the trial court. Hence, petitioner filed a petition for review on certiorari.

*His claim is that the penalty is invalid because it is imposed without according the owner a right to be

heard before a competent and impartial court as guaranteed by due process. He complains that the measure

should not have been presumed, and so sustained, as constitutional. There is also a challenge to the improper

exercise of the legislative power by the former President under Amendment No. 6 of the 1973 Constitution.

** The challenged measure is denominated an executive order but it is really presidential decree,

promulgating a new rule instead of merely implementing an existing law. It was issued by President Marcos

not for the purpose of taking care that the laws were faithfully executed but in the exercise of his legislative

authority under Amendment No. 6. It was provided thereunder that whenever in his judgment there existed a

grave emergency or a threat or imminence thereof or whenever the legislature failed or was unable to act

adequately on any matter that in his judgment required immediate action, he could, in order to meet the

exigency, issue decrees, orders or letters of instruction that were to have the force and effect of law. As there

is no showing of any exigency to justify the exercise of that extraordinary power then, the petitioner has

reason, indeed, to question the validity of the executive order.

ISSUE: WON the executive order is unconstitutional insofar as it authorizes outright confiscation of the


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carabao or carabeef being transported across provincial boundaries.

HELD: YES

The minimum requirements of due process are notice and hearing which, generally speaking, may not be

dispensed with because they are intended as a safeguard against official arbitrariness. This is not to say that

notice and hearing are imperative in every case for, to be sure, there are a number of admitted exception (as

in the summary abatement of a nuisance per se, like a mad dog on the loose, which may be killed on sight

because of the immediate danger it poses to the safety and lives of the people; Pornographic materials,

contaminated meat and narcotic drugs are inherently pernicious and may be summarily destroyed). In such

instances, previous judicial hearing may be omitted without violation of due process in view of the nature ofthe property involved or the urgency of the need to protect the general welfare from a clear and present

danger.

Police Power is invoked by the government to justify Executive Order No. 626-A, amending the basic rulein Executive Order No. 626, prohibiting the slaughter of carabaos except under certain conditions. The

original measure was issued for the reason, that "present conditions demand that the carabaos and the

buffaloes be conserved for the benefit of the small farmers who rely on them for energy needs." At the

outset there is a need for such a measure. The carabao, as the poor man's tractor, so to speak, has a direct

relevance to the public welfare and so is a lawful subject of Executive Order No. 626. There is no doubt thatby banning the slaughter of these animals except where they are at least seven years old if male and eleven

years old if female upon issuance of the necessary permit, the executive order will be conserving those still

fit for farm work or breeding and preventing their improvident depletion.

But while conceding that the amendatory measure has the same lawful subject as the original executive

order, we cannot say with equal certainty that it complies with the second requirement, viz., that there be a

lawful method. The reasonable connection between the means employed and the purpose sought to beachieved by the questioned measure is missing The prohibition of the inter-provincial transport of carabaos

cannot prevent their indiscriminate slaughter, considering that they can be killed anywhere, with no less

difficulty in one province than in another. Obviously, retaining the carabaos in one province will not prevent

their slaughter there, any more than moving them to another province will make it easier to kill them there.

In the instant case, the executive order defined the prohibition, convicted the petitioner and immediately

imposed punishment, which was carried out forthright. The measure struck at once and pounced upon the

petitioner without giving him a chance to be heard, thus denying him the centuries-old guaranty of

elementary fair play.

It is also conceded that summary action may be validly taken in administrative proceedings as procedural

due process is not necessarily judicial only. 20 In the exceptional cases accepted, however, there is a

justification for the omission of the right to a previous hearing, to wit, the immediacy of the problem sought

to be corrected and the urgency of the need to correct it. In the case before us, there was no such pressure of

time or action calling for the petitioner's peremptory treatment. The properties involved were not eveninimical per se as to require their instant destruction. Considering that, Executive Order No. 626-A is penal

in nature, the violation thereof should have been pronounced not by the police only but by a court of justice,

which alone would have had the authority to impose the prescribed penalty, and only after trial and

conviction of the accused.

Further, the manner of the disposition of the confiscated property as prescribed in the questioned executive

order is questionable. It is there authorized that the seized property shall "be distributed to charitable

institutions and other similar institutions as the Chairman of the National Meat Inspection Commission maysee fit, in the case of carabeef, and to deserving farmers through dispersal as the Director of Animal

Industry may see fit, in the case of carabaos." (Emphasis supplied.) The phrase "may see fit" is an extremely

generous and dangerous condition, if condition it is. It is laden with perilous opportunities for partiality and

abuse, and even corruption.


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*To sum up then, we find that the challenged measure is an invalid exercise of the police power because the

method employed to conserve the carabaos is not reasonably necessary to the purpose of the law and, worse,

is unduly oppressive. Due process is violated because the owner of the property confiscated is denied the

right to be heard in his defense and is immediately condemned and punished. The conferment on the

administrative authorities of the power to adjudge the guilt of the supposed offender is a clear encroachment

on judicial functions and militates against the doctrine of separation of powers. There is, finally, also an

invalid delegation of legislative powers to the officers mentioned therein who are granted unlimited

discretion in the distribution of the properties arbitrarily taken. For these reasons, we hereby declare

Executive Order No. 626-A unconstitutional.

• Validity of Exercise

o WON rules and regulation conform with:

! What the statute provides, and

! Whether it is reasonableo Requisites of a valid administrative issuances:

! Must not be inconsistent with the Constitution (Sutton)

! Must not be inconsistent with statute (SolGen)

!

Cannot amend an act of Congress (De La Serna)! Cannot exceed provision of laws (BFHI)

! Must be uniform, reasonable; not unfair or discriminatory (Lupangco)

DAR vs SUTTON

G.R. No. 162070, October 19, 2005

FACTS:

Respondents inherited a land in Aroroy, Masbate which has been devoted exclusively to cow and calfbreeding. Pursuant to the then existing agrarian reform program of the government, respondents made a

voluntary offer to sell (VOS) their landholdings to petitioner DAR to avail of certain incentives under the

law.

On June 10, 1988, a new agrarian law, Republic Act (R.A.) No. 6657, also known as the Comprehensive

Agrarian Reform Law (CARL) of 1988, took effect. It included in its coverage farms used for raising

livestock, poultry and swine.

In view of the Luz Farms ruling (that lands devoted to livestock and poultry-raising are not included in the

definition of agricultural land. Hence, we declared as unconstitutional certain provisions of the CARL

insofar as they included livestock farms in the coverage of agrarian reform) respondents filed with petitioner

DAR a formal request to withdraw their VOS as their landholding was devoted exclusively to cattle-raising

and thus exempted from the coverage of the CARL.

The Municipal Agrarian Reform Officer of Aroroy, Masbate, inspected respondents land and found that it

was devoted solely to cattle-raising and breeding. He recommended to the DAR Secretary that it be

exempted from the coverage of the CARL. Respondents reiterated to petitioner DAR the withdrawal of their

VOS and requested the return of the supporting papers they submitted in connection therewith. [4] Petitioner

ignored their request.

DAR issued A.O. No. 9, which provided that only portions of private agricultural lands used for the raising

of livestock, poultry and swine as of June 15, 1988 shall be excluded from the coverage of the CARL. In

determining the area of land to be excluded, the A.O. fixed the following retention limits, ( i.e., 1 hectare of

land per 1 head of animal shall be retained by the landowner and a ratio of 1.7815 hectares for livestockinfrastructure for every 21 heads of cattle shall likewise be excluded from the operations of the CARL)


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Respondents wrote the DAR Secretary and advised him to consider as final and irrevocable the withdrawal

of their VOS as, under the Luz Farms doctrine, their entire landholding is exempted from the CARL. Then

DAR Secretary Ernesto D. Garilao issued an Order partially granting the application of respondents for

exemption from the coverage of CARL. Petitioner ordered the rest of respondents landholding to be

segregated and placed under Compulsory Acquisition.

Respondents moved for reconsideration. They contend that their entire landholding should be exempted as it

is devoted exclusively to cattle-raising. Their motion was denied. They filed a notice of appeal [9] with the

Office of the President assailing: (1) the reasonableness and validity of DAR A.O. No. 9, s. 1993, whichprovided for a ratio between land and livestock in determining the land area qualified for exclusion from the

CARL, and (2) the constitutionality of DAR A.O. No. 9, s. 1993, in view of the Luz Farms case which

declared cattle-raising lands excluded from the coverage of agrarian reform.

The Office of the President affirmed the impugned Order of petitioner DAR.\ It ruled that DAR A.O. No. 9,

s. 1993, does not run counter to the Luz Farms case as the A.O. provided the guidelines to determine

whether a certain parcel of land is being used for cattle-raising. However, the issue on the constitutionality

of the assailed A.O. was left for the determination of the courts as the sole arbiters of such issue.

On appeal, the CA ruled in favor of the respondents. It declared DAR A.O. No. 9, s. 1993, void for being

contrary to the intent of the 1987 Constitutional Commission to exclude livestock farms from the land

reform program of the government. Hence, this petition.

*Invoking its rule-making power under Section 49 of the CARL, petitioner submits that it issued DAR A.O.

No. 9 to limit the area of livestock farm that may be retained by a landowner pursuant to its mandate to

place all public and private agricultural lands under the coverage of agrarian reform. Petitioner also contendsthat the A.O. seeks to remedy reports that some unscrupulous landowners have converted their agricultural

farms to livestock farms in order to evade their coverage in the agrarian reform program.

ISSUE: WON DAR A.O. No. 9, series of 1993, which prescribes a maximum retention limit for owners oflands devoted to livestock raising is constitutional.

HELD: YES

Administrative agencies are endowed with powers legislative in nature, i.e., the power to make rules and

regulations. They have been granted by Congress with the authority to issue rules to regulate the

implementation of a law entrusted to them. Delegated rule-making has become a practical necessity in

modern governance due to the increasing complexity and variety of public functions. However, while

administrative rules and regulations have the force and effect of law, they are not immune from judicial

review. They may be properly challenged before the courts to ensure that they do not violate the

Constitution and no grave abuse of administrative discretion is committed by the administrative body

concerned.

The fundamental rule in administrative law is that, to be valid, administrative rules and regulations must be

issued by authority of a law and must not contravene the provisions of the Constitution. The rule-making

power of an administrative agency may not be used to abridge the authority given to it by Congress or by the

Constitution. Nor can it be used to enlarge the power of the administrative agency beyond the scope

intended. Constitutional and statutory provisions control with respect to what rules and regulations may be

promulgated by administrative agencies and the scope of their regulations.[14]

The impugned A.O. is invalid as it contravenes the Constitution. The A.O. sought to regulate livestock farms

by including them in the coverage of agrarian reform and prescribing a maximum retention limit for their

ownership. However, the deliberations of the 1987 Constitutional Commission show a clear intent to

exclude, inter alia, all lands exclusively devoted to livestock, swine and poultry- raising. The Court clarified


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in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do not fall within

the definition of agriculture or agricultural activity. The raising of livestock, swine and poultry is different

from crop or tree farming. It is an industrial, not an agricultural, activity. A great portion of the investment

in this enterprise is in the form of industrial fixed assets, such as: animal housing structures and facilities,

drainage, waterers and blowers, feedmill with grinders, mixers, conveyors, exhausts and generators,

extensive warehousing facilities for feeds and other supplies, anti-pollution equipment like bio-gas and

digester plants augmented by lagoons and concrete ponds, deepwells, elevated water tanks, pumphouses,

sprayers, and other technological appurtenances.

Clearly, petitioner DAR has no power to regulate livestock farms which have been exempted by theConstitution from the coverage of agrarian reform. It has exceeded its power in issuing the assailed A.O.

Petitioner DAR argues that, in issuing the impugned A.O., it was seeking to address the reports it has

received that some unscrupulous landowners have been converting their agricultural lands to livestock farmsto avoid their coverage by the agrarian reform.

Again, we find neither merit nor logic in this contention. The undesirable scenario which petitioner seeks to

prevent with the issuance of the A.O. clearly does not apply in this case. Respondents family acquired their

landholdings as early as 1948. They have long been in the business of breeding cattle in Masbate which ispopularly known as the cattle-breeding capital of the Philippines. Petitioner DAR does not dispute this fact.

Indeed, there is no evidence on record that respondents have just recently engaged in or converted to the

business of breeding cattle after the enactment of the CARL that may lead one to suspect that respondentsintended to evade its coverage. It must be stressed that what the CARL prohibits is the conversion of

agricultural lands for non-agricultural purposes after the effectivity of the CARL. There has been no change

of business interest in the case of respondents.

Moreover, it is a fundamental rule of statutory construction that the reenactment of a statute by

Congress without substantial change is an implied legislative approval and adoption of the previous law. On

the other hand, by making a new law, Congress seeks to supersede an earlier one. ] In the case at bar, after

the passage of the 1988 CARL, Congress enacted R.A. No. 7881[20]

which amended certain provisions of theCARL. Specifically, the new law changed the definition of the terms agricultural activity and commercial

farming by dropping from its coverage lands that are devoted to commercial livestock, poultry and swine-

raising.[21] With this significant modification, Congress clearly sought to align the provisions of our agrarian

laws with the intent of the 1987 Constitutional Commission to exclude livestock farms from the coverage of

agrarian reform.

In sum, it is doctrinal that rules of administrative bodies must be in harmony with the provisions of

the Constitution. They cannot amend or extend the Constitution. To be valid, they must conform to and be

consistent with the Constitution. In case of conflict between an administrative order and the provisions of

the Constitution, the latter prevails.[22] The assailed A.O. of petitioner DAR was properly stricken down as

unconstitutional as it enlarges the coverage of agrarian reform beyond the scope intended by the 1987Constitution.

SOLICITOR GENERAL vs MMA

G.R. No. 102782 December 11, 1991

FACTS:

In Metropolitan Traffic Command, West Traffic District vs. Hon. Arsenio M. Gonong, the Court held that the

confiscation of the license plates of motor vehicles for traffic violations was not among the sanctions that

could be imposed by the Metro Manila Commission under PD 1605 and was permitted only under the

conditions laid dowm by LOI 43 in the case of stalled vehicles obstructing the public streets. It was therealso observed that even the confiscation of driver's licenses for traffic violations was not directly prescribed

by the decree nor was it allowed by the decree to be imposed by the Commission. No motion for


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reconsideration of that decision was submitted.

Subsequenlty, the Court received various complaints against confiscation of licenses by several Traffice

Enforcers: a) Rodolfo A. Malapira complained to the Court that when he was stopped for an alleged traffic

violation, his driver's license was confiscated by Traffic Enforcer Angel de los Reyes in Quezon City. B)

The Caloocan-Manila Drivers and Operators Association sent a letter to the Court asking who should

enforce the decision in the above-mentioned case, whether they could seek damages for confiscation of their

driver's licenses, and where they should file their complaints. B) Stephen L. Monsanto, complaining against

the confiscation of his driver's license by Traffic Enforcer A.D. Martinez for an alleged traffic violation in

Mandaluyong. Martinez however, averred that he was only complying with Ordinance no.7 of theMunicipality of Mandalayong D) Dan R. Calderon, a lawyer, sent a letter complaint to the Court, also for

confiscation of his driver's license by Pat. R.J. Tano-an of the Makati Police Force. E) Grandy N. Trieste,

lawyer, also protested the removal of his front license plate by E. Ramos of the Metropolitan Manila

Authority-Traffic Operations Center and the confiscation of his driver's license by Pat. A.V. Emmanuel ofthe Metropolitan Police Command-Western Police District.

The Metropolitan Manila Authority issued Ordinance No. 11, Series of 1991, authorizing itself "to detach

the license plate/tow and impound attended/ unattended/ abandoned motor vehicles illegally parked or

obstructing the flow of traffic in Metro Manila."

The Court issued a resolution to clarify matters since Ordinance no.11 appears in conflict with the decision

of the Court, where it was held that the license plates of motor vehicles may not be detached except onlyunder the conditions prescribed in LOI 43. The Court resolved to require the Metropolitan Manila Authority

and the Solicitor General to submit, within ten (10) days from notice hereof, separate COMMENTS on such

sanctions in light of the said decision.

Metropolitan Manila Authority defended the said ordinance on the ground that it was adopted pursuant to

the powers conferred upon it by EO 392, Sec.2 . (1. Formulation of policies on the delivery of basic services

requiring coordination or consolidation for the Authority; and 2. Promulgation of resolutions and

other issuances of metropolitan wide application, approval of a code of basic services requiringcoordination, andexercise of its rule-making powers)

The Authority argued that there was no conflict between the decision and the ordinance because the latter

was meant to supplement and not supplant the latter. It stressed that the decision itself said that the

confiscation of license plates was invalid in the absence of a valid law or ordinance, which was why

Ordinance No. 11 was enacted. The Authority also pointed out that the ordinance could not be attacked

collaterally but only in a direct action challenging its validity.

The Solicitor General expressed the view that the ordinance was null and void because it represented an

invalid exercise of a delegated legislative power. The flaw in the measure was that it violated existing law,

specifically PD 1605, which does not permit, and so impliedly prohibits, the removal of license plates andthe confiscation of driver's licenses for traffic violations in Metropolitan Manila. (The Court will consider

the motion to resolve filed by the Solicitor General a petition for prohibition against the enforcement of

Ordinance No. 11, Series of 1991, of the Metropohtan Manila Authority, and Ordinance No. 7, Series of

1988, of the Municipality of Mandaluyong)

ISSUE: The question we must resolve is the validity of the exercise of such delegated power.

HELD:

The Metro Manila Authority sustains Ordinance No. 11, Series of 1991, under the specific authority

conferred upon it by EO 392, while Ordinance No. 7, Series of 1988, is justified on the basis of the General

Welfare Clause embodied in the Local Government Code. It is not disputed that both measures were

enacted to promote the comfort and convenience of the public and to alleviate the worsening traffic


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problems in Metropolitan Manila due in large part to violations of traffic rules.

The Court holds that there is a valid delegation of legislative power to promulgate such measures, it

appearing that the requisites of such delegation are present. These requisites are. 1) the completeness of the

statute making the delegation; and 2) the presence of a sufficient standard.

Under the first requirement, the statute must leave the legislature complete in all its terms and provisions

such that all the delegate will have to do when the statute reaches it is to implement it. What only can be

delegated is not the discretion to determine what the law shall be but the discretion to determine how the law

shall be enforced. This has been done in the case at bar.

As a second requirement, the enforcement may be effected only in accordance with a sufficient standard, the

function of which is to map out the boundaries of the delegate's authority and thus "prevent the delegation

from running riot." This requirement has also been met. It is settled that the "convenience and welfare" ofthe public, particularly the motorists and passengers in the case at bar, is an acceptable sufficient standard to

delimit the delegate's authority.

To test the validity of such acts in the specific case now before us, we apply the particular requisites of a

valid ordinance as laid down by the accepted principles governing municipal corporations.

According to Elliot, a municipal ordinance, to be valid: 1) must not contravene the Constitution or any

statute; 2) must not be unfair or oppressive; 3) must not be partial or discriminatory; 4) must not prohibit butmay regulate trade; 5) must not be unreasonable; and 6) must be general and consistent with public policy.

The measures under consideration do not pass the first criterion because they do not conform to existing

law. The pertinent law is PD 1605. PD 1605 does not allow either the removal of license plates or theconfiscation of driver's licenses for traffic violations committed in Metropolitan Manila. The Metropolitan

Manila Commission (and now the Metropolitan Manila Authority) was allowed to "impose fines and

otherwise discipline" traffic violators only "in such amounts and under such penalties as are herein

prescribed," that is, by the decree itself. Nowhere is the removal of license plates directly imposed by thedecree or at least allowed by it to be imposed by the Commission.

The requirement that the municipal enactment must not violate existing law explains itself. Local political

subdivisions are able to legislate only by virtue of a valid delegation of legislative power from the national

legislature (except only that the power to create their own sources of revenue and to levy taxes is conferred

by the Constitution itself). They are mere agents vested with what is called the power of subordinate

legislation. As delegates of the Congress, the local government unit cannot contravene but must obey at all

times the will of their principal. In the case before us, the enactments in question, which are merely local in

origin, cannot prevail against the decree, which has the force and effect of a statute.

The measures in question do not merely add to the requirement of PD 1605 but, worse, impose sanctions thedecree does not allow and in fact actually prohibits. In so doing, the ordinances disregard and violate and in

effect partially repeal the law.

It is for Congress to determine, in the exercise of its own discretion, whether or not to impose such

sanctions, either directly through a statute or by simply delegating authority to this effect to the local

governments in Metropolitan Manila. Without such action, PD 1605 remains effective and continues

prohibit the confiscation of license plates of motor vehicles (except under the conditions prescribed in LOI

43) and of driver licenses as well for traffic violations in Metropolitan Manila.

BOIE-TAKEDA vs DE LA SERNA

G.R. No. 92174 December 10, 1993

FACTS:


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Sections 1 and 2 of Presidential Decree No. 851, the Thirteenth Month Pay Law, read as follows:

Sec 1. All employees are hereby required to pay all their employees receiving basic salary of not more than

P1,000.00 a month, regardless of the nature of the employment, a 13th month pay not later than December

24 of every year.

Sec. 2. Employers already paying their employees a 13th month pay or its equivalent are not covered by this

Decree.

Then Labor Minister Blas Ople promulgated the Rules and Regulations Implementing P.D. 851.

b) "Basic Salary" shall include all remunerations or earnings paid by an employer to an employee forservices rendered but may not include cost of living allowances granted pursuant to Presidential Decree No.

525 or Letter of Instructions No. 174, profit sharing payments, and all allowances and monetary benefits

which are not considered or integrated as part of the regular or basic salary of the employee at the time of

the promulgation of the Decree on December 16, 1975.

Supplementary Rules and Regulations implementing P.D. 851 were subsequently issued by Minister Ople

which inter alia set out items of compensation not included in the computation of the 13th month pay, viz.:

Sec. 4. Overtime pay, earnings and other remunerations which are not part of the basic salary shall not be

included in the computation of the 13th month pay.

President Corazon C. Aquino promulgated Memorandum Order No. 28, which contained a single provision

modifying Presidential Decree No. 851 by removing the salary ceiling of P1,000.00 a month.

More than a year later, then Labor Secretary Franklin Drilon promulgated the Revised Guidelines on the

Implementation of the 13th Month Pay Law,which, among other things, defined with particularity what

remunerative items were and were not embraced in the concept of 13th month pay, and specifically dealtwith employees who are paid a fixed or guaranteed wage plus commission. It also provided: Employees who

are paid a fixed or guaranteed wage plus commission are also entitled to the mandated 13th month pay

based on their total earnings during the calendar year, i.e., on both their fixed or guaranteed wage and

commission.

G.R. No. 92174.

A routine inspection was conducted on May 2, 1989 in the premises of petitioner Boie-Takeda Chemicals,

Inc. by Labor and Development Officer Reynaldo B. Ramos. Finding that Boie-Takeda had not been

including the commissions earned by its medical representatives in the computation of their 13th month pay,

Ramos served a Notice of Inspection Results on Boie-Takeda through its president, Mr. Benito Araneta,

requiring Boie-Takeda within ten (10) calendar days from notice to effect restitution or correction of "the

underpayment of 13th month pay for the year(s) 1986, 1987 and 1988 of Med Rep.

Boie-Takeda wrote the Labor Department contesting the Notice of Inspection Results, and expressing the

view "that the commission paid to our medical representatives are not to be included in the computation ofthe 13th month pay . . . (since the) law and its implementing rules speak of REGULAR or BASIC salary and

therefore exclude all other remunerations which are not part of the REGULAR salary."

Regional Director Luna C. Piezas directed Boie-Takeda to appear before his Office. On the appointed dates,

however, and despite due notice, no one appeared for Boie-Takeda. Director Piezas issued an

Order 3 directing Boie-Takeda to pay its medical representatives and its managers.

A motion for reconsideration was filed by Boie-Takeda which was treated as an appeal. Then Acting Labor

Secretary Dionisio de la Serna, affirmed the Order of Reg. Dir. Piezas with modification that the sales

commissions earned by Boie-Takeda's medical representatives before August 13, 1989, the effectivity date

of Memorandum Order No. 28 and its Implementing Guidelines, shall be excluded in the computation of

their 13th month pay.


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G. R. No. 102552

A similar Routine Inspection was conducted in the premises of Philippine Fuji Xerox Corp. In his Notice of

Inspection Results, addressed to the Manager, Mr. Nicolas O. Katigbak, Senior Labor and Employment

Officer Nicanor M. Torres noted the underpayment of 13th month pay of 62 employees, more or less —

pursuant to Revised Guidelines on the Implementation of the 13th month pay law for the period covering

1986, 1987 and 1988.

No action having been taken thereon by Philippine Fuji Xerox, Mr. Eduardo G. Gonzales, President of the

Philxerox Employee Union, wrote then Labor Secretary Franklin Drilon requesting a follow-up of theinspection findings. When no amicable settlement was reached, the parties were required to file their

position papers.

Subsequently, Regional Director Luna C. Piezas issued a resolution ordering PHILIPPINE FUJI XEROX torestitute to its salesmen the portion of the 13th month pay which arose out of the non-implementation of the

said revised guidelines.

Philippine Fuji Xerox appealed the aforequoted Order to the Office of the Secretary of Labor.

Undersecretary Cresenciano B. Trajano denied the appeal for lack of merit.

These petitions were consolidated.

Petitioners:

Under P.D. 851, the 13th month pay is based solely on basic salary. As defined by the law itself and

clarified by the implementing and Supplementary Rules as well as by the Supreme Court in a long line of

decisions, remunerations which do not form part of the basic or regular salary of an employee, such ascommissions, should not be considered in the computation of the 13th month pay. This being the case, the

Revised Guidelines on the Implementation of the 13th Month Pay Law issued by then Secretary Drilon

providing for the inclusion of commissions in the 13th month pay, were issued in excess of the statutory

authority conferred by P.D. 851. Petitioners further contend that assuming that Secretary Drilon did notexceed the statutory authority conferred by P.D. 851, still the Revised Guidelines are null and void as they

violate the equal protection of the law clause.

Respondents:

P.D. No. 851, otherwise known as the 13th Month Pay Law has already been amended by Memorandum

Order No. 28 issued by President Corazon C. Aquino on August 13, 1986 so that commissions are now

imputed into the computation of the 13th Month Pay. They add that the Revised Guidelines issued by then

Labor Secretary Drilon merely clarified a gray area occasioned by the silence of the law as to the nature of

commissions; and worked no violation of the equal protection clause of the Constitution, said Guidelines

being based on reasonable classification.

ISSUE: Whether or not the second paragraph of Section 5 (a) of the Revised Guidelines on the

Implementation of the 13th Month Pay Law issued by then Labor Secretary Franklin M

rule-making lecture p1

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