Composición MgAPO-5-1 (1EPH:100H 2 O)

- 3 and 4 no question since action filed purposely to bring forth constitutionality issues

4. Unless limited by a provision in the Constitution, if there is no express extension of tax exemption and other economic incentives granted by law, any presidential proclamation granting such extension through implication is unconstitutional because it violates Art VI Sec 28(4) which gives the legislature, not the executive, the full power to exempt any person or corporation or class of property from taxation and its power to exempt being as broad as its power to tax.

Reasoning

- Art VI Sec 28(4): No law granting any tax exemption shall be passed without the concurrence of a majority of all the members of Congress.

- Sec 3 Proc. No. 420: Investment Climate in JH SEZ: … the zone shall have all the applicable incentives of the SEZ under Sec 12 of RA 7227 and those applicable incentives granted in the Export Processing Zones, the Omnibus Investment Code of 1987, the Foreign Investment Act of 1991 and new investment laws that may be hereinafter enacted

> Sec 12 RA 7227: Subic SEZ

(b & c) exemption from tariff or custom duties, national and local taxes of business entities (d) free market and trade of specified goods or properties

(f) liberalized banking and finance

(g) relaxed immigration rules for foreign investors

- deliberations of Senate confirm exclusivity to Subic SEZ of the tax and investment privileges

(discussing Sec 12 RA 7227)

Angara: … we must confine these policies to Subic and provide that ―THE SPECIAL ECONOMIC ZONE OF SUBIC SHALL BE ESTABLISHED IN ACCORDANCE WITH THE FOLLOWING POLICIES‖… it is very clear that these principles and policies are applicable only to Subic as a free port

… so we agreed that we will simply limit the definition of pweors and description of the zone to Subic but that does not exclude the possibility of creating other economic zones within the baselands

… the provision now will be confined only to Subic

> RA 7916: The Special Economic Zone Act of 1995

- privilege of export processing zone-based businesses of importing capital equipment and raw materials free from taxes, duties and other restrictions

> Omnibus Investment Code of 1987

- tax and duty exemptions, tax holiday, tax credit, and other incentives

> RA 7042: Foreign Investments Act of 1991

- applicability to the subject zone of rules governing foreign investments in the Philippines

- It is clear that under Sec 12 RA 7227 ONLY the SUBIC SEZ which was granted by Congress with tax exemption, investment incentives and the like and no express extension of the aforesaid benefits to other SEZs still to be created at the time via presidential proclamation ; also grant of privileges to JH SEZ finds no support in the other laws specified under Sec 3 Proc. No. 420 which are already extant before the issuance of the proclamation or the enactment of RA 7227

- SC can void an act or policy of the political departments of the govt on two grounds – infringement of the Constitution or grave abuse of discretion – and clearly, Proc. No. 420 infringes upon the Constitution

5. NO because when the law merely emphasizes or reiterates the statutory role or functions is has been granted.

Reasoning

- under RA 7227, BCDA is entrusted with the following

(a) to own, hold and/or administer the military reservations of John Hay Air Station, Wallace Air Station, O‘Donnell Transmitter Station… which may be transferred to it by the President

- such broad rights of ownership and administration vested in BCDA over CJH, BCDA virtually has control over it subject to certain limitations of law

Decision Sec 3 of Proc. NO.420 is null and void and declared no legal force and effect. Proc. No. 420, without the invalidated portion, remains valid and effective

c) Appellate Jurisdiction of the Supreme Court

Automotive Industry Workers Alliance v. Romulo Ponente: Chico-Nazario, J.

Facts:

Fabian (president of PROMAT Construction Dev‘t) filed an administrative case against Nestor Agustin (District Engineer of First Metro Mla Engineering District) after a failed amorous relationship between the two, where Fabian

alleges that Agustin abused his power through acts of oppression, misconduct, and disgraceful misconduct. She seeks the dismissal of Nestor.

Nestor was found guilty by Desierto, but upon his motion for reconsideration, Desierto inhibited himself from hearing the case because Nestor‘s new counsel was Desierto‘s close associate. The case was transferred to Deputy Guerrero who exonerated the administrative charges against Nestor.

Petitioner now comes to the SC, pointing out the following laws:

Section 27 of RA 6770 (Ombudsman Act of 1989): In all administrative disciplinary cases, orders, directives or decisions of the Office of the Ombudsman may be appealed to the Supreme Court by filing a petition for certiorari within ten (10) days from receipt of the written notice of the order, directive or decision or denial of the motion for reconsideration in accordance with Rule 45 of the Rules of Court

Section 7, Rule III of Administrative Order No. 07 (Rules of Procedure of the Office of the Ombudsman), when a respondent is absolved of the charges in an administrative proceeding the decision of the Ombudsman is final and unappealable.

She submits that the Office of the Ombudsman has no authority under the law to restrict the right of appeal allowed by Republic Act No. 6770. Because of the aforecited provision in those Rules of Procedure, she claims that she found it necessary to take an alternative recourse under Rule 65 (original action for certiorari) of the Rules of Court,

because of the doubt it creates on the availability of appeal under Rule 45 (appeal by certiorari)of the Rules of Court.

Respondents claim that petitioner cannot assail the rules of procedure of the Ombudsman and question the propriety of the proposition.

The SC found that the liability of a public official could fall under the jurisdiction of both the Civil Service Commission and the Office of the Ombudsman, a fact which neither of the parties in this case brought up, prompting the SC to look into the constitutionality of the abovementioned laws against Sec. 30, Art VI of the Constitution.

Issue/Held/Ratio:

(1) A challenge on constitutional grounds must be raised by a party, but neither party in this case did. Will this prevent the Court from determining the constitutionality of the laws?

No. The courts are not at liberty to overlook or disregard its commands that are evasions of the Constitution. When it is clear that a statute transgresses the authority vested in a legislative body, it is the duty of the courts to declare that the constitution, and not the statute, governs in a case before them for judgment.

Thus, while courts will not ordinarily pass upon constitutional questions which are not raised in the pleadings, the rule has been recognized to admit of certain exceptions. It does not preclude a court from inquiring into its own jurisdiction or compel it to enter a judgment that it lacks jurisdiction to enter. If a statute on which a court's jurisdiction in a proceeding depends is unconstitutional, the court has no jurisdiction in the proceeding, and since it may determine whether or not it has jurisdiction, it necessarily follows that it may inquire into the constitutionality of the statute. The court, in this case ordered the parties to submit their positions and arguments on the subject matter.

(2) Petitioner contends that since she appealed via certiorari (Rule 45) authorized by Sec 27 RA 6770, such is not violative of the Constitution.

Court says the provision in the Constitution does not refer to quasi-judicial bodies. the very provision cited by petitioner specifies that the appellate jurisdiction of this Court contemplated therein is to be exercised over "final judgments and orders of lower courts," that is, the courts composing the integrated judicial system. It does not include the quasi-judicial bodies or agencies (even if the Ombudsman is mandated by the Constitution, the Court will not make a distinction between special and ordinary agencies), hence whenever the legislature intends that the decisions or resolutions of the quasi-judicial agency shall be reviewable by the Supreme Court or the Court of Appeals, a specific provision to that effect is included in the law creating that quasi-judicial agency and, for that matter, any special statutory court.

Court of Appeals is the more appropriate venue.

(3) Are the provisions constitutional?

Respondent invokes the rule that courts generally avoid having to decide a constitutional question, especially when the case can be decided on other grounds. Court says it is necessary in this case to determine constitutionality. Sec.

27 of RA 6770 is unconstitutional for increasing the appellate jurisdiction of the SC without its permission.

Deliberations in the Senate also show that there was no effort in getting the opinion of the SC in increasing the appellate jurisdiction. Likewise, Sec. 7, Rule III of Admin. Order No. 07 is unconstitutional.

(4) Is Sec. 27 of RA 6770 substantive or procedural?

It is merely procedural. If the rule takes away a vested right, it is no; procedural. If the rule creates a right such as the right to appeal, it may be classified as a substantive matter; but if it operates as a means of implementing an existing right then the rule deals merely with procedure. The right has been preserved in this case.

With the mentioned laws declared unconstitutional, the case is referred and transferred to the Court of Appeals

b. Procedure for the passage of bills

Tolentino v. Secretary of Finance supra Philconsa v. Enriquez supra

Gonzales v. Macaraig Ponente:

Facts/Issue/Held/Ratio:

RD: The President may veto inappropriate provisions, an inappropriate provision being a provision which does not relate to a specific item within the appropriations bill. The vetoed provision (Sec. 55 of the General Appropriations Bill of 1989) was inappropriate.

The President has general veto power according to

Art VI Sec. 27(1) - Every bill passed by the Congress shall, before it becomes a law, be presented to the President. If he approves the same he shall sign it; otherwise, he shall veto it and return the same with his objections to the House where it originated, which shall enter the objections at large in its Journal and proceed to reconsider it. If, after such reconsideration, two-thirds of all the Members of such House shall agree to pass the bill, it shall be sent, together with the objections, to the other House by which it shall likewise be reconsidered, and if approved by two-thirds of all the Members of that House, it shall become a law. In all such cases, the votes of each House shall be determined by yeas or nays, and the names of the Members voting for or against shall be entered in its Journal. The President shall communicate his veto of any bill to the House where it originated within thirty days after the date of receipt thereof, otherwise, it shall become a law as if he had signed it.

and specific item veto power in

Art VI Sec. 27(2) - The President shall have the power to veto any particular item or items in an appropriation, revenue, or tariff bill, but the veto shall not affect the item or items to which he does not object.

Bengzon v. Drilon Ponente:

Facts:

- Petition to review the constitutionality of the veto by the President of certain provisions of the General Appropriations Act (GAA) for the Fiscal Year 1992

- Petitioners are retired justices of the SC and the CA who were receiving monthly pensions under RA No.910 as amended by RA No. 1797

- Respondents Drilon et al are sued in their official capacities of the Executive, involved in the implementation of the release of funds under the GAA

- RA910 was enacted in 1953 to provide retirement pensions to Justices of the SC and the CA who have rendered service at least 2o years either in the judiciary or in any branch of govt, or in, both, or having attained the age of 70, or who resign by reason of incapacity to discharge the duties of the office; he shall receive until his death the salary which he has received at the time of his retirement

- RA910 was amended by RA1797. Identical retirement benefits were given to Consti Commissions and the AFP, under RA1568, as amended by RA3595, and PD578, respectively

- Marcos issued successive decrees which automatically readjusted the retirement pensions of military officers and enlisted men. But those in the judiciary and the Consti Commissions were not included in this automatic readjustment, as Marcos repealed the automatic readjustment provisions (Section 3-a of RA1797 and RA3595) for the judiciary and the Consti Commissions

- Realizing this unfairness, Congress in 1990 sought to reenact the repealed provisions by approving a bill on the matter (HB16297 and SB740)

- Pres. Aquino vetoed the HB on the ground that it would erode the foundation of the policy on standardization of compensation under the Salary Standardization Law, RA6758

- On the other hand, retired CA justices Barcelona and Enriquez filed a petition for readjustment of their pensions in accordance with RA1797 by reasoning out that PD644 repealing RA1797 did not take effect as there was no valid publication pursuant to Tanada v Tuvera, supposedly promulgated in 1975 but published only in the OG in 1983;

Court authorized it as a result

- As a result of the resolution by the Court, Congress included in the GAA appropriations for the Judiciary intended for the payment of adjusted pensions rates for the retired justices

- In Jan 1992, President vetoed portions of Section 1, and the entire Section 4 of the Special Provision for the SC and the Lower Courts on the ground that the President vetoed the HB on the matter already, and such appropriation would erode the policy of salary standardization

Issue:

WON the veto by the president of certain provisions in the General Appropriations Act for the Fiscal Year 1992 relating to the payment of the adjusted pension of the retired Justices of the SC and the CA

Held/Ratio:

- The President did not veto items but provisions of the law in the GAA.

- While veto power is generally all or nothing, vetoing the entire bill or none at all, it does not hold when it comes to appropriation, revenue or tariff bills.

o The Constitution has a item veto power to avoid inexpedient riders being attached to an indispensable appropriation or revenue measure; only a particular item or items may be vetoed

o Item in a bill refers to the particulars, the details, the distinct and severable parts; it is a specific appropriation of money, not some general provision of law, which happens to be put into an appropriation bill

o The President did not veto the general fund adjustment of 500M, to meet certain obligations W HICH is an ITEM.

o What she vetoed were provisions – methods and systems placed by Congress to insure that obligations would be paid when they fell due

o Thus, augmentation of specific appropriations found inadequate to pay retirement benefits is a provision and not an item

o Actually, what she really vetoed were RA1797 and the Resolution of the SC dated Nov 1991. WHICH SHE CANNOT VETO.

- The repealing decrees (PD644) of Marcos re taking away the automatic readjustment for the judiciary never became valid law because it was never published, pursuant to the Tanada v Tuvera doctrine; RA 1797 was never repealed and there was no need for an HB in 1990 to restore it so even the president‘s veto of the HB does not even have any effect in the continuing implementation of the law

- The Veto by the president trenches upon the constitutional grant of fiscal autonomy to the Judiciary

o Guaranty of full flexibility to allocate and utilize their resources with the wisdom and dispatch that their needs require

o Power to levy, assess and collect fees, fix rates of compensation not exceeding highest rates authorized by law

o Veto is tantamount to dictating to the judiciary how its funds should be utilized - The Justices have a right to their pensions pursuant to RA1797

o The purpose retirement laws like such is to entice competent men and women to enter the government service and retire with relative security

Miller v. Mardo Ponente: Barrera, J.

Facts:

- These are different cases taken together as they present only one identical question

- 1^st case: Manuel Gonzales filed complaint against Bill Miller at the DoL, claiming that he is a driver of Miller and was arbitrarily dismissed without separation pay

- Miller filed petition for prohibition against Hearing Officer Mardo of the DoL on ground that HO has no jurisdiction to hear and decide on the case

- Court rendered decision though that Reorg. Plan 2-A did not repeal Judiciary Act that conferred to CFI original jurisdiction to take cognizance of money claims re violations of labor standards

- 2^nd case: Cresencio Estano filed complaint at the DoL against Chin Hua Trading Co., for not being paid overtime and vacation leave pay as a driver in the company

- same circumstances as 1^st case, and court issued permanent injunction against hearing the cases by the Hearing Officer, as Reorg. Plan 2-A is null and void.

- 3^RD case: Numeriana Raganas filed with CFI a complaint against Sen Bee Trading Company for being underpaid, not being paid overtime, without sick leave and vacation leave pay, as a seamstress

- Sun Bee filed motion to dismiss, and insisted that CFI does not have jurisdiction as money claims must be filed with Regional Office of DoL under Reorg. Plan 2-A

- 4^th case: Vicente Romero filed case against Sia Seng at the DoL Sia Leng did noy\t file an answer and a decision was rendered in favor of Romero. But Labor Administrator Hernando refused to issue the writ of execution of the ecision as he believed that Sia Seng deserved to be heard

they insist as well that Reorg. Plan is not validly passed as a statute and unconstitutional

- 5^th case: Mariano Pabillare filed at the DoL a complaint against Fred Wilson and Co., as he was summarily dismissed wihout cause, without separation pay, and without sufficient notice.

- They moved to dismiss as it is only an administrative body, with no power to adjudicate money claims

- Certiorari, prohibition and injuction was filed as well – that Reorg Plan is null and void insofar as it vest original exclusive jurisdiction over money claims

Issue:

1. WON Reorganization Plan 20-A, prepared and submitted under the authority of RA 997 as amended by RA 1241, is valid, insofar as it confers jurisdiction to the Regional Offices of the Department of Labor to decide on claims of laborers for wages, overtime and separation pay, etc.

2. WON Reorganization Plan 20-A was validly passed by Congress

Held/Ratio:

1. No it is not valid.

- While the Reorganization Commission could create functions, it referred merely to administrative and not judicial functions such as deciding on money claims. Judicial power rests exclusively on the judiciary

- While legislature may confer administrative boards quasi-judicial powers, it must be incident to the exercise of administrative dunctions

- Conferment of quasi-judicial functions cannot be implied from a mere grant of power to create functions in connection with reorganization of the Executive

2. No it was not validly passed by Congress

2. No it was not validly passed by Congress