Philippine Contractors Accreditation Board v. Manila Water Company, Inc. G.R. No. 217590 | March 10, 2020

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Philippine Contractors Accreditation Board v. Manila Water Company, Inc.

G.R. No. 217590 | March 10, 2020

EN BANC, GESMUNDO, J.

 

Unconstitutionality of PCAB’s Implementing Rules; Limits of Administrative Rule-Making

 

The clear letter of the law is controlling and cannot be amended by a mere administrative rule issued for its implementation. 

 

Manila Water Company, Inc. sought accreditation for its foreign contractors to undertake construction projects for its waterworks and sewerage systems. The Philippine Contractors Accreditation Board (PCAB) denied the request, citing Section 3.1, Rule 3 of the Revised Rules and Regulations Governing Licensing and Accreditation of Constructors, which reserved Regular Licenses for Filipino-owned firms (at least 60% Filipino equity participation) while allowing foreign firms only a Special License for a single specific project. 

Manila Water filed a Petition for Declaratory Relief, arguing that the rule was unconstitutional as it imposed foreign ownership restrictions without Congressional authority. The Regional Trial Court (RTC) ruled in favor of Manila Water, declaring Section 3.1, Rule 3 void for exceeding PCAB’s delegated powers under Republic Act No. 4566 (Contractors’ License Law). 

PCAB appealed, asserting that it had the authority to regulate the construction industry and that the rule was consistent with the 1987 Constitution’s policy on professions and national economic protectionism. The case reached the Supreme Court.

 

 

Whether Section 3.1, Rule 3 of PCAB’s Implementing Rules, which imposes nationality restrictions on contractor licensing, is unconstitutional. 

YES. The Supreme Court struck down the nationality-based licensing requirement as unconstitutional, ruling that: 

1.    PCAB exceeded its delegated powers – The Contractors’ License Law (R.A. No. 4566) does not impose nationality restrictions on contractor licensing, and PCAB had no authority to create such a limitation. Administrative rules cannot go beyond the law they seek to implement. 

2.    Contracting is not a profession – PCAB wrongly classified construction as a profession subject to nationality restrictions under Section 14, Article XII of the 1987 Constitution. The Court clarified that construction is an industry, not a profession, and thus, should not be subject to restrictions on professional practice. 

3.    The restriction violates economic competition principles – The nationality-based rule unfairly restricted market entry, discouraging foreign investment in the construction industry, and contradicting economic policies promoting open competition. 

4.    The rule lacked basis in the Constitution or law – The Court emphasized that only Congress can impose nationality restrictions on economic activities under Section 10, Article XII of the Constitution, and there was no law reserving the construction industry exclusively for Filipinos.

 

Since Republic Act No. 4566 does not impose nationality-based restrictions, PCAB had no authority to create them through its rules. The Court affirmed the RTC ruling and declared void the nationality-based restrictions under Section 3.1, Rule 3 of PCAB’s Implementing Rules.

 

 

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Simon vs. Commission on Human Rights G.R. No. 100150 [January 5, 1994]

 CONSTITUTIONAL LAW

Simon vs. Commission on Human Rights

G.R. No. 100150 [January 5, 1994]

 EN BANC, VITUG, J.

 

Powers of Commission on Human Rights (CHR) to investigate civil and political rights violation of citizen; 

The Commission on Human Rights (CHR) is limited to investigating violations of civil and political rights, as defined by the Constitution. Economic rights and privileges, such as the right to engage in business, do not fall under the CHR’s jurisdiction unless they are directly linked to civil or political rights violations. Furthermore, the CHR’s contempt powers are confined to enforcing compliance with its investigative mandates and cannot be used to enforce orders in matters outside its constitutional authority.

 

In July 1990, the Quezon City government issued a demolition notice to vendors occupying stalls and shanties along North EDSA. The notice, signed by petitioner Carlos Quimpo, instructed the private respondents—members of the North EDSA Vendors Association—to vacate the premises within three days to make way for the development of a “People’s Park.” The respondents sought assistance from the Commission on Human Rights (CHR), filing a complaint to stop the demolition. 

The CHR issued several orders to halt the demolition and provide financial assistance to the affected vendors. It also cited the petitioners for contempt when the demolition proceeded despite its directives. The petitioners challenged the CHR’s jurisdiction, arguing that the issues raised did not fall under human rights violations involving civil or political rights as envisioned by the Constitution. They claimed that the respondents’ rights to engage in business were merely privileges, not enforceable human rights.

 

Whether or not the CHR have jurisdiction to investigate the demolition of vendors’ stalls and shanties as a human rights violation involving civil and political rights. 

NO. The Supreme Court ruled that the CHR’s jurisdiction is confined to investigating violations of civil and political rights and that it exceeded its authority in this case. The Court invalidated the CHR’s orders to stop the demolition and its imposition of contempt penalties. 

The Court explained that civil rights pertain to an individual’s entitlements as a citizen, such as property rights, equal protection under the law, and contractual freedom. Political rights relate to participation in governmental functions, such as suffrage and holding public office. Human rights violations, as contemplated by the Constitution, are those involving severe breaches of civil and political rights, such as torture, enforced disappearances, or political detention. 

The Court found that the demolition of stalls and shanties, planned for the construction of a public park, did not constitute a human rights violation involving civil or political rights. The claimed “right to engage in business” was a mere privilege and not among the inalienable rights protected under the CHR’s jurisdiction. 

On the CHR’s power to cite for contempt, the Court held that this authority is limited to enforcing its operational guidelines and rules of procedure necessary to carry out its investigative function. The CHR’s contempt powers do not extend to enforcing resolutions on matters beyond its jurisdiction, such as halting a demolition based on alleged economic rights violations.

 

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Philippine Blooming Mills vs. Philippine Blooming Mills G.R. No. L-31195 [June 5, 1973]

 CONSTITUTIONAL LAW

Philippine Blooming Mills vs. Philippine Blooming Mills

G.R. No. L-31195 [June 5, 1973]

EN BANC, MAKASIAR, J.

 

Bill of Rights; Freedom to Associate

Government agencies are strictly limited to the powers expressly conferred upon them by their enabling statutes. Any act or contract entered into beyond the scope of such powers is ultra vires and void.

 

The petitioner Philippine Blooming Mills Employees Organization (hereinafter referred to as PBMEO) is a legitimate labor union composed of the employees of the respondent Philippine Blooming Mills Co., Inc., and petitioners Nicanor Tolentino, Florencio Padrigano, Rufino Roxas, Mariano de Leon, Asencion Paciente, Bonifacio Vacuna, Benjamin Pagcu and Rodulfo Munsod are officers and members of the petitioner Union. PBMEO decided to stage a mass demonstration in front of Malacañang to express their grievances against the alleged abuses of the Pasig Police. 

Petitioners claim that on March 1, 1969, they decided to stage a mass demonstration at Malacañang on March 4, 1969, in protest against alleged abuses of the Pasig police, to be participated in by the workers in the first shift (from 6 A.M. to 2 P.M.) as well as those in the regular second and third shifts (from 7 A.M. to 4 P.M. and from 8 A.M. to 5 P.M., respectively); and that they informed the respondent Company of their proposed demonstration. The Philippine Blooming Mills Inc., called for a meeting with the leaders of the PBMEO after learning about the planned mass demonstration. During the meeting, the planned demonstration was confirmed by the union. But it was stressed out by the union that the demonstration was not a strike against the company but was in factual exercise of the laborers inalienable constitutional right to freedom of expression, freedom of speech and freedom for petition for redress of grievances. 

The company asked them to cancel the demonstration for it would interrupt the normal course of their business which may result in the loss of revenue. This was backed up with the threat of the possibility that the workers would lose their jobs if they pushed through with the rally. A second meeting took place where the company reiterated their appeal that while the workers may be allowed to participate, those from the 1st and regular shifts should not absent themselves to participate, otherwise, they would be dismissed. Since it was too late to cancel the plan, the rally took place and the officers of the PBMEO were eventually dismissed for a violation of the ‘No Strike and No Lockout’ clause of their Collective Bargaining Agreement. The lower court decided in favour of Philippine Blooming Mills Co., Inc., and the officers of the PBMEO were found guilty of bargaining in bad faith. The PBMEO’s motion for reconsideration was subsequently denied by the Court of Industrial Relations for being filed two days late.

 

Whether or not the workers who joined the strike violated the Collective Bargaining Agreement?

NO. While the Bill of Rights also protects property rights, the primacy of human rights over property rights is recognized. Because these freedoms are "delicate and vulnerable, as well as supremely precious in our society" and the "threat of sanctions may deter their exercise almost as potently as the actual application of sanctions," they "need breathing space to survive," permitting government regulation only "with narrow specificity." Property and property rights can be lost thru prescription; but human rights are imprescriptible. In the hierarchy of civil liberties, the rights of free expression, free assembly and petition, are not only civil rights but also political rights essential to man's enjoyment of his life, to his happiness and to his full and complete fulfillment. Thru these freedoms the citizens can participate not merely in the periodic establishment of the government through their suffrage but also in the administration of public affairs as well as in the discipline of abusive public officers. The citizen is accorded these rights so that he can appeal to the appropriate governmental officers or agencies for redress and protection as well as for the imposition of the lawful sanctions on erring public officers and employees.      

 

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Iron and Steel Authority (ISA) v. Court of Appeals G.R. No. 102976 [October 25, 1995]

 CONSTITUTIONAL LAW

Iron and Steel Authority (ISA) v. Court of Appeals

G.R. No. 102976 [October 25, 1995]

THIRD DIVISION, FELICIANO, J.

 

Ultra Vires Powers

 

Government agencies are strictly limited to the powers expressly conferred upon them by their enabling statutes. Any act or contract entered into beyond the scope of such powers is ultra vires and void.

 

The Iron and Steel Authority (ISA) entered into a loan agreement with Maria Cristina Fertilizer Corporation (MCFC), a private entity engaged in fertilizer production. Under the agreement, ISA provided a loan to MCFC to finance the purchase of equipment and other operational needs. MCFC failed to repay the loan upon maturity, prompting ISA to file a collection case against MCFC. 

MCFC, in its defense, argued that the loan agreement was void for being ultra vires, claiming that ISA, as a government agency, lacked the authority to grant loans. The trial court ruled in favor of MCFC, declaring the loan agreement void. ISA appealed to the Court of Appeals, which upheld the trial court’s decision. ISA then elevated the case to the Supreme Court.

 

Whether the loan agreement entered into by the Iron and Steel Authority with Maria Cristina Fertilizer Corporation is valid and binding. 

NO. The Supreme Court ruled in favor of the Court of Appeals and Maria Cristina Fertilizer Corporation, affirming the nullity of the loan agreement. The Court emphasized that government agencies like the Iron and Steel Authority must strictly adhere to their statutory mandates. ISA’s enabling law did not grant it the authority to engage in lending activities or act as a financial intermediary. Thus, the loan agreement was ultra vires and void. 

The Court noted that while ISA had the mandate to develop the iron and steel industry, lending money to private entities was not within the scope of its legal powers. Any act performed beyond the authority granted by law is considered ultra vires and has no legal effect. 

Furthermore, the Court stressed that contracts entered into by government agencies must conform to their statutory powers to avoid overreach and ensure accountability. In this case, the absence of explicit authority for ISA to grant loans rendered the agreement unenforceable.

 

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Didipio Earth Savers Multipurpose Association vs Gozun G.R. No. 157882 [March 30, 2006]

 CONSTITUTIONAL LAW

Didipio Earth Savers Multipurpose Association vs Gozun

G.R. No. 157882 [March 30, 2006]

FIRST DIVISION, CHICO-NAZARIO, J.

 

Police Power; Eminent Domain; Delegation of Legilative Power to Administrative Agencies

 

Republic Act No. 7942 (Philippine Mining Act of 1995) and the DENR’s implementing rules and regulations are valid and constitutional. Delegation of legislative authority to administrative agencies is permissible when it provides specificity and ensures effective implementation of the law.

 

In 1987, Cory rolled out EO 279 w/c empowered DENR to stipulate with foreign companies when it comes to either technical or financial large scale exploration or mining. In 1995, Ramos signed into law RA 7942 or the Philippine Mining Act. In 1994, Ramos already signed an FTAA with Arimco Mining Co, an Australian company. The FTAA authorized AMC (later CAMC) to explore 37,000 ha of land in Quirino and N. Vizcaya including Brgy Didipio.After the passage of the law, DENR rolled out its implementing RRs. Didipio petitioned to have the law and the RR to be annulled as it is unconstitutional and it constitutes unlawful taking of property. 

The Didipio Earth-Savers’ Multi-Purpose Association, Inc. (DESAMA) and several individuals petitioned to nullify a Financial or Technical Assistance Agreement (FTAA) granted by the Department of Environment and Natural Resources (DENR) to Climax-Arimco Mining Corporation (CAMC). They argued that Republic Act No. 7942, the Philippine Mining Act of 1995, and its implementing rules and regulations (IRRs) were unconstitutional. Specifically, they claimed the law violated the constitutional mandate to protect natural resources, failed to safeguard the rights of indigenous peoples, and infringed on the constitutional right to a balanced and healthful ecology. Additionally, the petitioners contended that RA 7942 improperly delegated legislative powers to the DENR by authorizing it to issue detailed regulations. 

The DENR and CAMC argued that the Mining Act and its IRRs were constitutional and consistent with the constitutional framework for the responsible utilization of natural resources. They emphasized that the law provided safeguards for environmental protection and indigenous peoples' rights and was designed to support national development.

 

Whether RA 7942 (Philippine Mining Act of 1995) and the DENR’s implementing rules and regulations (IRRs) are unconstitutional. 

NO. The Supreme Court ruled in favor of the DENR and CAMC, upholding the validity and constitutionality of RA 7942 and its implementing rules and regulations. The Court ruled that the Mining Act of 1995 was enacted to operationalize the constitutional mandate allowing the state to utilize natural resources for economic development. The law is consistent with Article XII of the 1987 Constitution, which recognizes both the state’s authority to manage natural resources and the need to protect the environment. 

The Court held that RA 7942 provided the necessary safeguards to ensure the responsible utilization of natural resources. It required environmental impact assessments, consultations with affected communities, and adherence to strict environmental standards. Furthermore, the law protected the rights of indigenous peoples through mechanisms such as free, prior, and informed consent (FPIC) for mining activities within ancestral domains, as mandated by the Indigenous Peoples’ Rights Act (IPRA). 

On the issue of delegation of legislative power, the Court ruled that the delegation of authority to the DENR to craft implementing regulations was valid. The delegation was specific and necessary to enable the DENR, as the agency with technical expertise, to execute the law effectively. The regulations issued by the DENR were deemed consistent with the policy objectives of RA 7942. 

The Court also emphasized the need to balance the constitutional right to a balanced and healthful ecology with the state's duty to promote economic development. RA 7942 and its IRRs embody this balance by allowing mining operations under strict environmental controls and community protections. Petitioners failed to show any concrete violations of constitutional or statutory rights.

 

 

 

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City Government of Quezon vs. Judge Ericta GR No. L-34915 [June 24, 1983]

 CONSTITUTIONAL LAW

City Government of Quezon vs. Judge Ericta

GR No. L-34915 [June 24, 1983]

FIRST DIVISION, GUTIERREZ, JR., J

 

Misuse of Police Power; Lawful Means; Unconstitutional Taking of Property

 

The exercise of police power cannot be used as a substitute for eminent domain when the state or local government seeks to take private property for public use. Such an act requires the payment of just compensation and adherence to due process. Ordinances that compel private property owners to donate land for public purposes, without compensation, constitute an unconstitutional taking of property.

 

An ordinance was promulgated in Quezon city which approved the the regulation of establishment of private cemeteries in the said city. According to the ordinance, 6% of the total area of the private memorial park shall be set aside for charity burial of deceased persons who are paupers and have been residents of QC. Himlayang Pilipino, a private memorial park, contends that the taking or confiscation of property restricts the use of property such that it cannot be used for any reasonable purpose and deprives the owner of all beneficial use of his property. It also contends that the taking is not a valid exercise of police power, since the properties taken in the exercise of police power are destroyed and not for the benefit of the public.

 

Whether or not the ordinance requiring private cemeteries to allocate 6% of their area for pauper burials constitute a valid exercise of police power.

 

NO. The ordinance made by Quezon City is not a valid way of taking private property. The ordinance amounted to a confiscation of private property without just compensation, violating the constitutional guarantee against deprivation of property without due process. Police power is intended to regulate the use or enjoyment of property for the public good, not to outright take or confiscate private property for public use. The ordinance crossed this boundary by compelling private cemeteries to donate land without compensation. 

The ordinance is actually a taking without compensation of a certain area from a private cemetery to benefit paupers who are charges of the municipal corporation; instead of building or maintaining public cemeteries. If the city wished to use private property for public purposes, such as paupers' burials, it should have exercised its power of eminent domain, which requires payment of just compensation, rather than relying on the general welfare clause. State's exercise of the power of expropriation requires payment of just compensation. The ordinance could not be justified under the general welfare clause, as there was no reasonable connection between the requirement to set aside private land and the promotion of public health, safety, or welfare. The provision merely shifted the city’s responsibility to provide public cemeteries onto private operators. Passing the ordinance without benefiting the owner of the property with just compensation or due process, would amount to unjust taking of a real property.

 

 

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BAUTISTA VS. JUNIO G.R. No L-50908 [January 31, 1984]

 CONSTITUTIONAL LAW

BAUTISTA VS. JUNIO

G.R. No L-50908 [January 31, 1984]

EN BANC, FERNANDO C.J

 

Lawful Subject; Police Power; LOI; No Violation of Equal Protection Clause

 

Police power refers to the capacity of the states to regulate behavior and enforce order within their territory to promote the health, safety, morals, and general welfare of their inhabitants.

 

The constitutionality of Letter of Instruction (LOI) No. 869, a response to protracted oil crisis, banning the use of private motor vehicles with H (heavy) and EH (extra heavy) plates on week-ends and holidays, was assailed for being allegedly violative of the due process and equal protection guarantees of the Constitution.

 

Petitioners also contends that Memorandum Circular No. 39 issued by herein respondents imposing penalties of fine, confiscation of the vehicle and cancellation of license of owners of the above specified vehicles found violating such LOI, is likewise unconstitutional, for being violative of the doctrine of “undue delegation of legislative power.”

 

Respondents denied the above allegations.

 

Whether or not Letter of Instruction 869 as implemented by Memorandum Circular No. 39 is violative of certain constitutional rights.

 

NO. The disputed regulatory measure is an appropriate response to a problem that presses urgently for solution, wherein its reasonableness is immediately apparent. Thus, due process is not ignored, much less infringed. The exercise of police power may cut into the rights to liberty and property for the promotion of the general welfare. Those adversely affected may invoke the equal protection clause only if they can show a factual foundation for its invalidity.

 

Moreover, since LOI No. 869 and MC No. 39 were adopted pursuant to the Land Transportation and Traffic Code which contains a specific provision as to penalties, the imposition of a fine or the suspension of registration under the conditions therein set forth is valid with the exception of the impounding of a vehicle.

 

 

Important Legal Principles

1. Police Power:
• The case emphasizes the extent of police power, which is the inherent authority of the state to enact laws and regulations to promote public welfare, safety, and morals. The decision recognized that local governments possess police power to regulate land use and zoning.
2. Due Process:
• The ruling also highlighted the importance of due process in the exercise of police power. Even though the government has broad authority, it must not infringe upon individual rights without following appropriate legal procedures. The principles of fairness and justice in regulatory actions were upheld.
3. Lawful Subject:
• The Court discussed the necessity for regulations enacted under police power to pertain to lawful subjects. The regulations must be justified on legitimate grounds pertinent to public health, safety, or morals and must also align with constitutional safeguards.

 
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Ismael v. People, G.R. Nos. 234435-36, [February 6, 2023]

 CASE DIGEST

Ismael v. People

 G.R. Nos. 234435-36, [February 6, 2023]

SECOND, LOPEZ, M.V

 

Speedy disposition of cases; Right to be informed of the nature and cause of the accusations against him 

An information alleging conspiracy can stand even if only one person is charged except that the court cannot pass verdict on the co-conspirators who were not charged in the information. 

 

The Municipality of Lantawanin, Basilan, has faced persistent arrears on unremitted GSIS premiums since 1997, aggravated by accumulated penalties during Mayor Ismael's term starting in 2001. Despite collection letters sent to the mayor's office for arrears from January 1999 to February 2003, the obligations remained outstanding, leading to the suspension of members' loan privileges. Vice Mayor Dalugdugan and others filed a complaint against petitioners for malversation of public funds, resulting in charges before the Sandiganbayan for violation of Section 3(e) of RA No. 3019 and violations of Sections 3.3.1 and 3.4, Rule III of the IRR of RA No. 8291. The Sandiganbayan convicted the petitioners. 

Petitioners attack the validity of the Informations as they alleged conspiracy but failed to implead the municipal accountant and budget officer, who are indispensable in consummating the offenses charged. Petitioners submit that they cannot be expected to discharge their respective duties in the remittance of the GSIS contributions without the issuance of the certificate of availability of funds and remittance vouchers by the municipal accountant and budget officer. Hence, for petitioners, such incomplete allegation in the

Informations violated their constitutional right to be informed of the nature and cause of the accusations against them. They also argue that their right to speedy disposition of cases was also violated since the Informations were filed on June 5, 2005, but resolved only on August 2, 2017. They maintain that their failure to remit was due to several factors beyond their control, such as the terrorism activities in the area which disparaged their municipality for years, the arrearages left by the previous administration which inflated due to penalties, and the limited resources of the municipality to meet its fiscal demands. 

 

Whether or not the petitioners' right to be informed of the nature and cause of the accusations against them was violated. 

NO. The non-inclusion of other conspirators in the indictment does not violate the right to be fully informed of the nature and cause of the accusation against the accused. The Constitution mandates that the accused be informed of the accusation's nature and cause, as outlined in Section 14(2), Article III. Rule 110, Section 6 of the Rules of Court specifies necessary allegations in a criminal information, including the accused's name, offense designation, acts or omissions constituting the offense, offended party's name, approximate date of offense commission, and place of offense. Section 9 of the same Rule requires clear and concise language to inform the accused of the offense charged. In this case, the Informations against the petitioners sufficiently stated their failure to ensure the municipality's GSIS contributions' full and timely remittance. The indictment of purported conspirators and their roles is not necessary for the Informations' sufficiency. Tan, Jr. v. Sandiganbayan affirms that an information alleging conspiracy can stand even if only one person is charged, although the court cannot pass judgment on co-conspirators not charged.

Whether or not the petitioners' right to the speedy disposition of cases was violated. 

NO. The mere delay in proceedings does not necessarily violate the right to speedy disposition of cases or speedy trial. The determination of whether a delay is inordinate depends on the examination of the facts and circumstances of the case. Courts assess whether the delay is reasonable considering the complexity of the case and the timely invocation of the accused's rights. In this case, although there was a lengthy delay in the proceedings, the petitioners were not blameless, as they contributed to the delay by not complying with procedural requirements. Their actions demonstrated a renunciation of their rights to speedy disposition of the case and speedy trial. Additionally, the delay did not result in significant prejudice to the petitioners, and there was no evidence of arbitrariness, vexation, or oppression in the delay. Therefore, the delay was not deemed unconstitutional as it was not objected to in a timely manner and did not cause substantial harm to the petitioners.

 

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