Municipality of Paoay vs Manaois

MUNICIPALITY OF PAOAY v. MANAOIS

G.R. No. L-3485, June 30, 1950

Facts:

The municipality of Paoay leased 6 fishery lots to Francisco V. Duque for a period of four years. However, Duque was not able to comply with the terms of the lease contract; hence, the municipality approved a resolution confiscating said fishery lots and advertised its lease for public bidding.

TeodoroManaois, being the highest bidder, was awarded the lease. However, Manaois was not able to exercise his right to possession because Duque continued to claim possession over the properties and despite the appeal of Manaois to the Municipality of Paoay to put him in possession and the efforts of the municipality to oust Duque, Duque succeeded in continuing in his possession and keeping Manaois and his men out.

Manaois brought an action against the Municipality of Paoay to recover the sum paid by him for the lease of the fishery lots plus damages. Court of First Instance of Pangasinan ruled in his favor. A writ of execution and attachment were issued to enforce the judgment. The municipality filed a petition asking for the dissolution of that attachment of levy of the properties which was denied by the CFI.

The municipality filed a petition for certiorari with the writ of preliminary injunction, asking that the order of the CFI be reversed and that the attachment of the properties of the municipality be dissolved. The municipality contended that the properties attached by the sheriff for purposes of execution are not subject to levy because they are properties for public use.

Issue:

WON fishery or municipal waters of the town of Paoay or its usufruct may be levied upon and subject to execution?

Held:

No. There can be no question that properties for public use held by municipal corporation are not subject to levy and execution. The authorities are unanimous on this point. This Court held that properties for public use like trucks used for sprinkling the streets, police patrol wagons, police stations, public markets, together with the land on which they stand are exempt from execution. Even public revenues of municipal corporations destined for the expenses of the municipality are also exempt from the execution. The reason behind this exemption extended to properties for public use, and public municipal revenues is that they are held in trust for the people, intended and used for the accomplishment of the purposes for which municipal corporations are created, and that to subject said properties and public funds to execution would materially impede, even defeat and in some instances destroy said purpose.

Property however, which is patrimonial and which is held by municipality in its proprietary capacity is treated by great weight of authority as the private asset of the town and may be levied upon and sold under an ordinary execution. The same rule applies to municipal funds derived from patrimonial properties, for instance, it has been held that shares of stocks held by municipal corporations are subject to execution. If this is true, with more reason should income or revenue coming from these shares of stock, in the form of interest or dividends, be subject to execution.

The fishery or municipal waters of the town of Paoay, Ilocos Norte, which had been parceled out or divided into lots and later let out to private persons for fishing purposes at an annual rental are clearly not subject to execution. In the first place, they do not belong to the municipality. They may well be regarded as property of State. What the municipality of Paoay hold is merely what may be considered the usufruct or the right to use said municipal waters, granted to it by section 2321 of the Revised Administrative Code.

Now, is this particular usufruct of the municipality of Paoay over its municipal waters, subject to execution to enforce a judgment against the town? No. First, it is not a usufruct based on or derived from an inherent right of the town. It is based merely on a grant made by the Legislature. These marine waters are ordinarily for public use, open to navigation and fishing by the people. The municipality of Paoay is not holding this usufruct or right of fishery in a permanent or absolute manner so as to enable it to dispose of it or to allow it to be taken away from it as its property through execution. The Legislature thru section 2321 of the Administrative Code, as already stated, saw fit to grant the usufruct of said marine waters for fishery purpose, to the towns bordering said waters. Said towns have no visited right over said marine waters. The Legislature, for reasons it may deem valid or as a matter of public policy, may at any time, repeal or modify said section 2321 and revoke this grant to coastal towns and open these marine waters to the public. Or the Legislature may grant the usufruct or right of fishery to the provinces concerned so that said provinces may operate or administer them by leasing them to private parties.All this only goes to prove that the municipality of Paoay is not holding this usufruct or right of fishery in a permanent or absolute manner so as to enable it to dispose of it or to allow it to be taken away from it as its property through execution.

Second, if this were to be allowed and this right sold on execution, the buyer would immediately step into the shoes of the judgment-debtor municipality. Such buyer presumably buys only the right of the municipality. He does not buy the fishery itself nor the municipal waters because that belongs to the State. All that the buyer might do would be to let out or rent to private individuals the fishery rights over the lots into which the municipal waters had been parceled out or divided, and that is, after public bidding. Then, we shall have a situation rather anomalous to be sure, of a private individual conducting public bidding, renting to the highest bidders fishery lots over municipal waters which are property of the State, and appropriating the results to his own private use. The impropriety, if not illegality, of such a contingency is readily apparent. The situation imagined implies the deprivation of the municipal corporation of a source of a substantial income, expressly provide by law. Because of all this, we hold that the right or usufruct of the town of Paoay over its municipal waters is not subject to execution.

But we hold that the revenue or income coming from the renting of these fishery lots is certainly subject to execution. It may be profitable, if not necessary, to distinguish this kind of revenue from that derived from taxes, municipal licenses and market fees are provided for and imposed by the law, they are intended primarily and exclusively for the purpose of financing the governmental activities and functions of municipal corporations. Not so with the income derived from fisheries. In the first place, the usufruct over municipal waters was granted by the Legislature merely to help or bolster up the economy of municipal government. This kind of revenue is not indispensable for the performance of governmental functions. In the second place, the amount of this income is far from definite or fixed. It depends upon the amounts which prospective bidders or lessees are willing to pay. In other words, too many municipalities engaged in this business of letting out municipal waters for fishing purposes, it is a sort of sideline, so that even without it the municipality may still continue functioning and perform its essential duties as such municipal corporations.

We call this activity of municipalities in renting municipal waters for fishing purposes as a business for the reasons that the law itself allowed said municipalities to engage in it for profit. And it is but just that a town so engaged should pay and liquidate obligations contracted in connection with said fishing business, with the income derived therefrom.

In conclusion, we hold that the fishery lots numbering about forty in the municipality of Paoay, mentioned at the beginning of this decision are not subject to execution. For this reason, the levy and attachment made by the Provincial Sheriff of Ilocos Norte of theses fishery lots is void and the order of the Court of First Instance of Pangasinan insofar as it failed to dissolve the attachment made on these lots is reversed. However, the amount of P1,712.01 in the municipal treasury of Paoay representing the rental paid by Demetrio Tabije on fishery lots let out by the municipality of Paoay is a proper subject of levy, and the attachment made thereon by the Sheriff is valid.

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Office of the Ombudsman vs CA and Barriga

OFFICE OF THE OMBUDSMAN vs. CA and BARRIGA

G.R. No. 172224.  January 26, 2011

Facts:

Sometime in 2000, Sonia Q. Pua, a Municipal Councilor of Carmen, Cebu, filed a complaint with the Office of the Deputy Ombudsman for Visayas, alleging thatMayorVirgilio E. Villamor, Municipal TreasurerBontia, and respondent Municipal AccountantBarriga, entered into several irregular and anomalous transactions in their official capacity.

In a Decision dated 28 August 2002, the Office of the Deputy Ombudsman for Visayas found Barriga guilty of misconduct and imposed on her the penalty of six months suspension from the service.

Upon review, petitioner Office of the Ombudsman modified the decision and found Barriga guilty of conduct prejudicial to the best interest of the service and imposed on her the penalty of suspension for one year.Barriga filed a motion for reconsideration which petitioner denied.

Later, in an Order dated 13 November 2002, petitioner directed the municipal mayor of Carmen, Cebu to implement the decision dated 28 August 2002.

Barriga filed a petition for review with the CA which denied the petition for lack of merit.Barriga then elevated the case to the Supreme Court which also denied the petition. MR and second MR was likewise denied.

After a month, petitioner, through the Office of the Deputy Ombudsman for Visayas, again directed the municipal mayor of Carmen, Cebu to implement the Order dated 13 November 2002.

Barriga made a request that the implementation of the penalty of one-year suspension be held in abeyance pending the issuance of the entry of judgment by this Supreme Court. The request was denied by petitioner.

However, Barriga, in order to delay the implementation of her suspension from service elevated the case once again to the CA. The CA in rendering a favorable decision in favor of Barriga nullified the Ombudsman’s orders from implementing its decision. CA said that the immediate implementation of petitioner’s Order dated 13 November 2002 was premature pending resolution of the appeal. Since Republic Act No. 6770 or the Ombudsman Act of 1989 gives parties the right to appeal then such right also generally carries with it the right to stay these decisions pending appeal. Thus, the CA concluded that the acts of petitioner cannot be permitted nor tolerated.

Pursuant to the CA’s Resolution dated 16 June 2005, the municipal mayor of Carmen, Cebu reinstated Barriga as municipal accountant.

Petitioner filed a Motion for Reconsideration and raised the issue of finality of the Ombudsman’s Decision dated 28 August 2002. The motion was denied by the CA. Hence, this petition.

Issue:

Whether the Court of Appeals gravely abused its discretion in nullifying the orders of the Office of the Ombudsman to the municipal mayor of Carmen, Cebu for the immediate implementation of the penalty of suspension from service of respondent Barriga even though the case was pending on appeal.

  

Held:

Yes. Section 7, Rule III of Administrative Order No. 7, as amended by Administrative Order No. 17, states:

Section 7. Finality and execution of decision.- Where the respondent is absolved of the charge, and in case of conviction where the penalty imposed is public censure or reprimand, suspension of not more than one month, or a fine equivalent to one month salary, the decision shall be final, executory and unappealable. In all other cases, the decision may be appealed to the Court of Appeals on a verified petition for review under the requirements and conditions set forth in Rule 43 of the Rules of Court, within fifteen (15) days from receipt of the written Notice of the Decision or Order denying the Motion for Reconsideration.

An appeal shall not stop the decision from being executory. In case the penalty is suspension or removal and the respondent wins such appeal, he shall be considered as having been under preventive suspension and shall be paid the salary and such other emoluments that he did not receive by reason of the suspension or removal.

A decision of the Office of the Ombudsman in administrative cases shall be executed as a matter of course. The Office of the Ombudsman shall ensure that the decision shall be strictly enforced and properly implemented. The refusal or failure by any officer without just cause to comply with an order of the Office of the Ombudsman to remove, suspend, demote, fine, or censure shall be a ground for disciplinary action against said officer.

It is clear from the provision that when a public official has been found guilty of an administrative charge by the Office of the Ombudsman and the penalty imposed is suspension for more than a month, an appeal may be made to the CA. However, such appeal shall not stop the decision from being executory and the implementation of the decision follows as a matter of course.

The CA is incorrect. The provision in the Rules of Procedure of the Office of the Ombudsman is clear that an appeal by a public official from a decision meted out by the Ombudsman shall not stop the decision from being executory. In Office of the Ombudsman v. Court of Appeals and Macabulos, we held that decisions of the Ombudsman are immediately executory even pending appeal in the CA.

Thus, the Ombudsman’s order imposing on Barriga the penalty of suspension from office for one year without pay is immediately executory even pending appeal in the Court of Appeals.

Petition granted. The Resolutions dated 20 February 2006 and 16 June 2005 of the Court of Appeals in were set aside. The modified Order dated 28 August 2002 of the Office of the Ombudsman suspending Dinah C. Barriga from government service for one year without pay was reinstated. Since Dinah C. Barriga already partially served her suspension from government service, the Municipal Mayor of Carmen, Cebu wasdirected to implement with dispatch the remaining balance of number of days of suspension from office not yet served by Barriga. 

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Osea vs Malaya

OSEA vs MALAYA

G.R. No. 139821, January 30, 2002

FACTS:

Petitioner Eleonor Osea filed a protest case with the Civil Service Commission alleging that she was appointed as Officer-in-Charge, Assistant Schools Division Superintendent of Camarines Sur, by the then Secretary of DECS, upon the endorsement of the Provincial School Board of Camarines Sur. However, despite this, President Fidel Ramos, appointed respondent Corazon Malaya to the position of Schools Division Superintendent of Camarines Sur.

Petitioner claims that the appointment of respondent was made without prior consultation with the Provincial School Board, in violation of Section 99 of the Local Government Code as well as her vested right as the Schools Division Superintendent of Camarines Sur. Petitioner prayed that respondent’s appointment be recalled and set aside for being null and void.

The pertinent portion of Section 99 of Republic Act No. 7610, also known as the Local Government Code of 1991, states:

Sec. 99. Functions of Local School Boards. --- The provincial, city or municipal school board shall:

                                            xxx           xxx           xxx.

The Department of Education, Culture and Sports shall consult the local school boards on the appointment of division superintendents, district supervisors, school principals, and other school officials.

The Civil Service Commission dismissed petitioner’s protest complaint. The CSC found that President Ramos appointed respondent without any specific division. Thus, respondent performed the functions of Schools Division Superintendent in Iriga City. On November 3, 1997, Sec. Gloria designated respondent as Schools Division Superintendent of Camarines Sur, and petitioner Osea as Schools Division Superintendent of Iriga City. CSC held that Sec.99 of the LGC of 1991 contemplates a situation where the DECS issues the appointments, whereas respondent’s appointment was made by the President, in the exercise of his appointing power. Moreover, the designation of respondent as Schools Division Superintendent of Camarines Sur and of petitioner as Schools Division Superintendent of Iriga City were in the nature of reassignments, in which case consultation with the local school board was unnecessary.

Petitioner’s MR was denied. Hence, she filed a petition for certiorari

ISSUE:

Whether respondent’s appointment require the mandatory consultation with the Local School Board under Sec.99 of RA 7160.

HELD:

Section 99 of the LGC applies to appointments made by the DECS because at the time of the enactment of the LGC, schools division superintendents were appointed by the DECS to specific division or location. However, in 1994, the Career Executive Service Board issued a Memorandum Circular placing the positions of schools division superintendent and assistant schools division superintendent within the career executive service. Consequently, the power to appoint persons to career executive service positions was transferred from the DECS to the President. The appointment may not be specific as to location. The prerogative to designate the appointees to their particular stations was vested in the Department of Education, Culture and Sports Secretary, pursuant to the exigencies of the service, as provided in Department of Education, Culture and Sports Order No. 75, Series of 1996.

In the case at bar, the appointment issued by President Ramos in favor of respondent to the Schools Division Superintendent position on September 3, 1996 did not specify her station. It was Secretary Gloria who, in a Memorandum dated November 3, 1997, assigned and designated respondent to the Division of Camarines Sur, and petitioner to the Division of Iriga City.

In addition, under the circumstances, the designation of respondent as Schools Division Superintendent of Camarines Sur was not a case of appointment but rather in the nature of reassignment from Iriga City, where she previously exercised her functions as Officer-in-Charge-Schools Division Superintendent, to Camarines Sur. Therefore, Section 99 of the LGC, which requires prior consultation with the local school board does not apply. It only refers to appointments made by the Department of Education, Culture and Sports. Such is the plain meaning of the said law.

Appointment vs. Reassignment

Appointment should be distinguished from reassignment. An appointment may be defined as the selection, by the authority vested with the power, of an individual who is to exercise the functions of a given office. When completed, usually with its confirmation, the appointment results in security of tenure for the person chosen unless he is replaceable at pleasure because of the nature of his office.

On the other hand, a reassignment is merely a movement of an employee from one organizational unit to another in the same department or agency which does not involve a reduction in rank, status or salary and does not require the issuance of an appointment. In the same vein, a designation connotes merely the imposition of additional duties on an incumbent official

Petitioner asserts a vested right to the position of Schools Division Superintendent of Camarines Sur, citing her endorsement by the Provincial School Board. Her qualification to the office, however, lacks one essential ingredient, i.e., her appointment thereto. While she was recommended by Secretary Gloria to President Ramos for appointment to the position of Schools Division Superintendent of Camarines Sur, the recommendation was not acted upon by the President.

Petitioner Osea's designation as Officer-in-Charge, Assistant Schools Division Superintendent, was expressly made subject to further advice from the DECS. Thus, her designation was temporary. In fact, there was a need to recommend her to the President for appointment in a permanent capacity. Inasmuch as she occupied her position only temporarily, petitioner can be transferred or reassigned to other positions without violating her right to security of tenure. Indeed, petitioner has no vested right to the position of Schools Division Superintendent of Camarines Sur.

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Pimentel vs Aguirre

PIMENTEL vs. AGUIRRE

G.R. No. 132988 July 19, 2000

FACTS:

President Ramos issued Administrative Order 372 (Adoption of Economic Measures in Government for Fiscal Year 1998). Section 1 provided that all government departments and agencies, including state universities and colleges, GOCCs and LGUs will identify and implement measures in FY 1998 that will replace total expenditures by at least 25% of authorized regular appropriations for non-personal services items. Section 4 also provided that pending assessment by the Development Budget Coordinating Committee of the emerging fiscal situation, the amount equivalent to 10% of the IRA to LGUs shall be withheld. President Estrada issued AO 43, amending Section 4 by reducing to 5% the IRA to be withheld.

ISSUES:

1. WON Section 1 of AO 372, insofar as it "directs" LGUs to reduce their expenditures by 25% is valid

2. WON withholding a part of LGUs IRA is valid

HELD:

1. Yes. Section 1 of AO 372, insofar as it “directs” LGUs to reduce expenditures by at least 25% is a valid exercise of the President’s power of general supervision over LGUs as it is advisory only.  “Supervisory power, when contrasted with control, is the power of mere oversight over an inferior body; it does not include any restraining authority over such body.” Under existing law, LGU, in addition to having administrative autonomy, enjoy fiscal autonomy as well.  Fiscal autonomy means that local governments have the power to create their own sources of revenue in addition to their equitable share in the national taxes released by the national government, as well as the power to allocate their resources in accordance with their own priorities.  It extends to the preparation of their budgets, and local officials in turn have to work within the constraints thereof.

Local fiscal autonomy does not however rule out any manner of national government intervention by way of supervision, in order to ensure that local programs, fiscal and otherwise, are consistent with national goals.  Significantly, the President, by constitutional fiat, is the head of the economic and planning agency of the government, primarily responsible for formulating and implementing continuing, coordinated and integrated social and economic policies, plans and programs for the entire country.  However, under the Constitution, the formulation and the implementation of such policies and programs are subject to "consultations with the appropriate public agencies, various private sectors, and local government units."  The President cannot do so unilaterally.

Consequently, the Local Government Code provides:

"x x x In the event the national government incurs an unmanaged public sector deficit, the President of the Philippines is hereby authorized, upon the recommendation of [the] Secretary of Finance, Secretary of the Interior and Local Government and Secretary of Budget and Management, and subject to consultation with the presiding officers of both Houses of Congress and the presidents of the liga, to make the necessary adjustments in the internal revenue allotment of local government units but in no case shall the allotment be less than thirty percent (30%) of the collection of national internal revenue taxes of the third fiscal year preceding the current fiscal year   x x x."

There are therefore several requisites before the President may interfere in local fiscal matters: 

(1) An unmanaged public sector deficit of the national government;

(2) Consultations with the presiding officers of the Senate and the House of Representatives and the presidents of the various local leagues; and

(3) The corresponding recommendation of the secretaries of the Department of Finance, Interior and Local Government, and Budget and Management.  Furthermore, any adjustment in the allotment shall in no case be less than thirty percent (30%) of the collection of national internal revenue taxes of the third fiscal year preceding the current one.

Petitioner points out that respondents failed to comply with these requisites before the issuance and the implementation of AO 372.  At the very least, they did not even try to show that the national government was suffering from an unmanageable public sector deficit.  Neither did they claim having conducted consultations with the different leagues of local governments.  Without these requisites, the President has no authority to adjust, much less to reduce, unilaterally the LGU's internal revenue allotment.

The solicitor general insists, however, that AO 372 is merely directory and has been issued by the President consistent with his power of supervision over local governments.  It is intended only to advise all government agencies and instrumentalities to undertake cost-reduction measures that will help maintain economic stability in the country, which is facing economic difficulties.  Besides, it does not contain any sanction in case of noncompliance.  Being merely an advisory, therefore, Section 1 of AO 372 is well within the powers of the President.  Since it is not a mandatory imposition, the directive cannot be characterized as an exercise of the power of control.

While the wordings of Section 1 of AO 372 have a rather commanding tone, and while we agree with petitioner that the requirements of Section 284 of the Local Government Code have not been satisfied, we are prepared to accept the solicitor general's assurance  that  the  directive  to  "identify and implement measures  x x x  that will reduce total expenditures  x x x  by at least 25% of authorized regular appropriation" is merely advisory in character, and does not constitute a mandatory or binding order that interferes with local autonomy.  The language used, while authoritative, does not amount to a command that emanates from a boss to a subaltern.

Rather, the provision is merely an advisory to prevail upon local executives to recognize the need for fiscal restraint in a period of economic difficulty.  Indeed, all concerned would do well to heed the President's call to unity, solidarity and teamwork to help alleviate the crisis.  It is understood, however, that no legal sanction may be imposed upon LGUs and their officials who do not follow such advice.  It is in this light that we sustain the solicitor general's contention in regard to Section 1.

2. No. Section 4 is invalid because it interferes with local autonomy, particularly local fiscal autonomy.  A basic feature of local fiscal autonomy is the automatic release of the shares of LGUs in the national internal revenue.  This is mandated by no less than the Constitution. The Local Government Code specifies further that the release shall be made directly to the LGU concerned within five (5) days after every quarter of the year and "shall not be subject to any lien or holdback that may be imposed by the national government for whatever purpose." As a rule, the term "shall" is a word of command that must be given a compulsory meaning. The provision is, therefore, imperative.

Section 4 of AO 372, however, orders the withholding, effective January 1, 1998, of 10 percent of the LGUs' IRA "pending the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal situation" in the country.  Such withholding clearly contravenes the Constitution and the law.  Although temporary, it is equivalent to a holdback, which means "something held back or withheld, often temporarily." Hence, the "temporary" nature of the retention by the national government does not matter.  Any retention is prohibited.

Scope of President's Power of Supervision Over LGUs

Section 4 of Article X of the Constitution confines the President's power over local governments to one of general supervision.  It reads as follows:

"Sec. 4. The President of the Philippines shall exercise general supervision over local governments.  x x x"

This provision has been interpreted to exclude the power of control.  In Mondano v. Silvosa, the Court contrasted the President's power of supervision over local government officials with that of his power of control over executive officials of the national government.  It was emphasized that the two terms -- supervision and control -- differed in meaning and extent.  The Court distinguished them as follows:

"x x x  In administrative law, supervision means overseeing or the power or authority of an officer to see that subordinate officers perform their duties.  If the latter fail or neglect to fulfill them, the former may take such action or step as prescribed by law to make them perform their duties.  Control, on the other hand, means the power of an officer to alter or modify or nullify or set aside what a subordinate officer ha[s] done in the performance of his duties and to substitute the judgment of the former for that of the latter."

In Taule v. Santos, we further stated that the Chief Executive wielded no more authority than that of checking whether local governments or their officials were performing their duties as provided by the fundamental law and by statutes.  He cannot interfere with local governments, so long as they act within the scope of their authority.  "Supervisory power, when contrasted with control, is the power of mere oversight over an inferior body; it does not include any restraining authority over such body," we said.

In a more recent case, Drilon v. Lim, the difference between control and supervision was further delineated.  Officers in control lay down the rules in the performance or accomplishment of an act.  If these rules are not followed, they may, in their discretion, order the act undone or redone by their subordinates or even decide to do it themselves.  On the other hand, supervision does not cover such authority.  Supervising officials merely see to it that the rules are followed, but they themselves do not lay down such rules, nor do they have the discretion to modify or replace them.  If the rules are not observed, they may order the work done or redone, but only to conform to such rules.  They may not prescribe their own manner of execution of the act.  They have no discretion on this matter except to see to it that the rules are followed.

Under our present system of government, executive power is vested in the President. The members of the Cabinet and other executive officials are merely alter egos.  As such, they are subject to the power of control of the President, at whose will and behest they can be removed from office; or their actions and decisions changed, suspended or reversed. In contrast, the heads of political subdivisions are elected by the people.  Their sovereign powers emanate from the electorate, to whom they are directly accountable.  By constitutional fiat, they are subject to the President’s supervision only, not control, so long as their acts are exercised within the sphere of their legitimate powers.  By the same token, the President may not withhold or alter any authority or power given them by the Constitution and the law.

Extent of Local Autonomy

Hand in hand with the constitutional restraint on the President's power over local governments is the state policy of ensuring local autonomy.

In Ganzon v. Court of Appeals, we said that local autonomy signified "a more responsive and accountable local government structure instituted through a system of decentralization."  The grant of autonomy is intended to "break up the monopoly of the national government over the affairs of local governments, x x x  not  x x x  to end the relation of partnership and interdependence between the central administration and local government units  x x x."  Paradoxically, local governments are still subject to regulation, however limited, for the purpose of enhancing self-government.

Decentralization simply means the devolution of national administration, not power, to local governments.  Local officials remain accountable to the central government as the law may provide. The difference between decentralization of administration and that of power was explained in detail in Limbona v. Mangelin as follows:

"Now, autonomy is either decentralization of administration or decentralization of power.  There is decentralization of administration when the central government delegates administrative powers to political subdivisions in order to broaden the base of government power and in the process to make local governments 'more responsive and accountable,' and 'ensure their fullest development as self-reliant communities and make them more effective partners in the pursuit of national development and social progress.' At the same time, it relieves the central government of the burden of managing local affairs and enables it to concentrate on national concerns. The President exercises 'general supervision' over them, but only to 'ensure that local affairs are administered according to law.' He has no control over their acts in the sense that he can substitute their judgments with his own.

Decentralization of power, on the other hand, involves an abdication of political power in the favor of local government units declared to be autonomous.  In that case, the autonomous government is free to chart its own destiny and shape its future with minimum intervention from central authorities.  According to a constitutional author, decentralization of power amounts to 'self-immolation,' since in that event, the autonomous government becomes accountable not to the central authorities but to its constituency."

Under the Philippine concept of local autonomy, the national government has not completely relinquished all its powers over local governments, including autonomous regions.  Only administrative powers over local affairs are delegated to political subdivisions.  The purpose of the delegation is to make governance more directly responsive and effective at the local levels.  In turn, economic, political and social development at the smaller political units are expected to propel social and economic growth and development.  But to enable the country to develop as a whole, the programs and policies effected locally must be integrated and coordinated towards a common national goal.  Thus, policy-setting for the entire country still lies in the President and Congress.  As we stated in Magtajas v. Pryce Properties Corp., Inc., municipal governments are still agents of the national government.

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Republic vs. Court of Appeals

REPUBLIC vs. CA

G.R. No. 146587 July 2, 2002

FACTS:

Petitioner (PIA) instituted expropriation proceedings covering a total of 544,980 square meters of contiguous land situated along MacArthur Highway, Malolos, Bulacan, to be utilized for the continued broadcast operation and use of radio transmitter facilities for the “Voice of the Philippines” project.

Petitioner made a deposit of P517,558.80, the sum provisionally fixed as being the reasonable value of the property. On 26 February 1979, or more than 9 years after the institution of the expropriation proceedings, the trial court issued this order condemning the property and ordering the plaintiff to pay the defendants the just compensation for the property.

It would appear that the National Government failed to pay the respondents the just compensation pursuant to the foregoing decision.  The respondents then filed a manifestation with a motion seeking payment for the expropriated property. In response, the court issued a writ of execution for the implementation thereof. 

Meanwhile, Pres. Estrada issued Proc. No. 22 transferring 20 hectares of the expropriated land to the Bulacan State University.

Despite the court’s order, the Santos heirs remained unpaid and no action was on their case until petitioner filed its manifestation and motion to permit the deposit in court of the amount P4,664,000 by way of just compensation.

The Santos heirs submitted a counter-motion to adjust the compensation from P6/sq.m. as previously fixed to its current zonal value of P5,000/sq.m. or to cause the return of the expropriated property.

The RTC Bulacan ruled in favor of the Santos heirs declaring its 26 February 1979 Decision to be unenforceable on the ground of prescription in accordance with Sec. 6, Rule 39 of the 1964/1997 ROC which states that a final and executory judgment or order may be executed on motion within 5 years from the date of its entry. RTC denied petitioner’s Motion to Permit Deposit and ordered the return of the expropriated property to the heirs of Santos.

ISSUES:

1. WON the petitioner  may appropriate the property

2. WON the respondents are entitled to the return of the property in question

HELD:

1.  The right of eminent domain is usually understood to be an ultimate right of the sovereign power to appropriate any property within its territorial sovereignty for a public purpose. Fundamental to the independent existence of a State, it requires no recognition by the Constitution, whose provisions are taken as being merely confirmatory of its presence and as being regulatory, at most, in the due exercise of the power.  In the hands of the legislature, the power is inherent, its scope matching that of taxation, even that of police power itself, in many respects.  It reaches to every form of property the State needs for public use and, as an old case so puts it, all separate interests of individuals in property are held under a tacit agreement or implied reservation vesting upon the sovereign the right to resume the possession of the property whenever the public interest so requires it.

The ubiquitous character of eminent domain is manifest in the nature of the expropriation proceedings. Expropriation proceedings are not adversarial in the conventional sense, for the condemning authority is not required to assert any conflicting interest in the property.  Thus, by filing the action, the condemnor in effect merely serves notice that it is taking title and possession of the property, and the defendant asserts title or interest in the property, not to prove a right to possession, but to prove a right to compensation for the taking.

Obviously, however, the power is not without its limits: first, the taking must be for public use, and second, that just compensation must be given to the private owner of the property. These twin proscriptions have their origin in the recognition of the necessity for achieving balance between the State interests, on the one hand, and private rights, upon the other hand, by effectively restraining the former and affording protection to the latter. In determining “public use,” two approaches are utilized - the first is public employment or the actual use by the public, and the second is public advantage or benefit. It is also useful to view the matter as being subject to constant growth, which is to say that as society advances, its demands upon the individual so increases, and each demand is a new use to which the resources of the individual may be devoted.

The expropriated property has been shown to be for the continued utilization by the PIA, a significant portion thereof being ceded for the expansion of the facilities of the Bulacan State University and for the propagation of the Philippine carabao, themselves in line with the requirements of public purpose. Respondents question the public nature of the utilization by petitioner of the condemned property, pointing out that its present use differs from the purpose originally contemplated in the 1969 expropriation proceedings. The argument is of no moment.  The property has assumed a public character upon its expropriation. Surely, petitioner, as the condemnor and as the owner of the property, is well within its rights to alter and decide the use of that property, the only limitation being that it be for public use, which, decidedly, it is. 

2. NO. In insisting on the return of the expropriated property, respondents would exhort on the pronouncement in Provincial Government of Sorsogon vs. Vda. de Villaroya where the unpaid landowners were allowed the alternative remedy of recovery of the property there in question. It might be borne in mind that the case involved the municipal government of Sorsogon, to which the power of eminent domain is not inherent, but merely delegated and of limited application.  The grant of the power of eminent domain to local governments under Republic Act No. 7160 cannot be understood as being the pervasive and all-encompassing power vested in the legislative branch of government. For local governments to be able to wield the power, it must, by enabling law, be delegated to it by the national legislature, but even then, this delegated power of eminent domain is not, strictly speaking, a power of eminent, but only of inferior, domain or only as broad or confined as the real authority would want it to be.

Thus, in Valdehueza vs. Republic where the private landowners had remained unpaid ten years after the termination of the expropriation proceedings, this Court ruled -

“The points in dispute are whether such payment can still be made and, if so, in what amount.  Said lots have been the subject of expropriation proceedings.  By final and executory judgment in said proceedings, they were condemned for public use, as part of an airport, and ordered sold to the government.  x x x It follows that both by virtue of the judgment, long final, in the expropriation suit, as well as the annotations upon their title certificates, plaintiffs are not entitled to recover possession of their expropriated lots - which are still devoted to the public use for which they were expropriated - but only to demand the fair market value of the same.

"Said relief may be granted under plaintiffs' prayer for: `such other remedies, which may be deemed just and equitable under the premises'."

The Court proceeded to reiterate its pronouncement in Alfonso vs. Pasay City where the recovery of possession of property taken for public use prayed for by the unpaid landowner was denied even while no requisite expropriation proceedings were first instituted. The landowner was merely given the relief of recovering compensation for his property computed at its market value at the time it was taken and appropriated by the State.

The judgment rendered by the Bulacan RTC in 1979 on the expropriation proceedings provides not only for the payment of just compensation to herein respondents but likewise adjudges the property condemned in favor of petitioner over which parties, as well as their privies, are bound. Petitioner has occupied, utilized and, for all intents and purposes, exercised dominion over the property pursuant to the judgment.  The exercise of such rights vested to it as the condemnee indeed has amounted to at least a partial compliance or satisfaction of the 1979 judgment, thereby preempting any claim of bar by prescription on grounds of non-execution.  In arguing for the return of their property on the basis of non-payment, respondents ignore the fact that the right of the expropriatory authority is far from that of an unpaid seller in ordinary sales, to which the remedy of rescission might perhaps apply. An in rem proceeding, condemnation acts upon the property. After condemnation, the paramount title is in the public under a new and independent title; thus, by giving notice to all claimants to a disputed title, condemnation proceedings provide a judicial process for securing better title against all the world than may be obtained by voluntary conveyance.

Respondents, in arguing laches against petitioner did not take into account that the same argument could likewise apply against them. Respondents first instituted proceedings for payment against petitioner on 09 May 1984, or five years after the 1979 judgment had become final. The unusually long delay in bringing the action to compel payment against herein petitioner would militate against them. Consistently with the rule that one should take good care of his own concern, respondents should have commenced the proper action upon the finality of the judgment which, indeed, resulted in a permanent deprivation of their ownership and possession of the property.

The constitutional limitation of “just compensation” is considered to be the sum equivalent to the market value of the property, broadly described to be the price fixed by the seller in open market in the usual and ordinary course of legal action and competition or the fair value of the property as between one who receives, and one who desires to sell, it fixed at the time of the actual taking by the government. Thus, if property is taken for public use before compensation is deposited with the court having jurisdiction over the case, the final compensation must include interests on its just value to be computed from the time the property is taken to the time when compensation is actually paid or deposited with the court. In fine, between the taking of the property and the actual payment, legal interests accrue in order to place the owner in a position as good as (but not better than) the position he was in before the taking occurred.

The Bulacan trial court, in its 1979 decision, was correct in imposing interests on the zonal value of the property to be computed from the time petitioner instituted condemnation proceedings and “took” the property in September 1969. This allowance of interest on the amount found to be the value of the property as of the time of the taking computed, being an effective forbearance, at 12% per annum should help eliminate the issue of the constant fluctuation and inflation of the value of the currency over time. Article 1250 of the Civil Code, providing that, in case of extraordinary inflation or deflation, the value of the currency at the time of the establishment of the obligation shall be the basis for the payment when no agreement to the contrary is stipulated, has strict application only to contractual obligations. In other words, a contractual agreement is needed for the effects of extraordinary inflation to be taken into account to alter the value of the currency.

All given, the trial court of Bulacan in issuing its order, dated 01 March 2000, vacating its decision of 26 February 1979 has acted beyond its lawful cognizance, the only authority left to it being to order its execution. Verily, private respondents, although not entitled to the return of the expropriated property, deserve to be paid promptly on the yet unpaid award of just compensation already fixed by final judgment of the Bulacan RTC on 26 February 1979 at P6.00 per square meter, with legal interest thereon at 12% per annum computed from the date of "taking" of the property, i.e., 19 September 1969, until the due amount shall have been fully paid.

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Reyes vs Comelec

REYES vs. COMELEC

G.R. No. 120905, March 7, 1996

FACTS:

Dr. Manalo filed with the Sangguniang Panlalawigan an administrative complaint against incumbent Mayor Reyes of Bongabong, Oriental Mindoro. It was alleged that Reyes exacted and collected P50,000,00 from each market stall holder in the Bongabong Public Market. Also, that certain checks issued to him by the National Reconciliation and Development Program of the DILG were never received by the Municipal Treasurer nor reflected in the books of accounts of the same officer; and that he took 27 heads of cattle from beneficiaries of a cattle dispersal program. The Sangguniang Panlalawigan found petitioner guilty of the charges and ordered his removal from office.

Reyes filed a petition for certiorari, prohibition and injunction with the RTC of Oriental Mindoro. Later, the Presiding Officer of the Sangguniang Panlalawigan issued an order for Reyes to vacate the position of mayor and to turn over the office to the incumbent vice mayor but he refused to accept the service of the order.

Thereafter, Reyes filed a certificate of candidacy with the Comelec but a petition for disqualification was filed against him. Thus, the Comelec canceled Reyes’s certificate of candidacy. However, the Municipal Board of Canvassers of Bongabong unaware of the disqualification of Reyes by the Comelec, proclaimed him the duly-elected mayor.

The COMELEC en banc declared him to have been validly disqualified as candidate and, consequently, set aside his proclamation as municipal mayor.  Hence the petition in G.R. No. 120905, which was filed on July 20, 1995, alleging grave abuse of discretion by the COMELEC on the ground that the decision in the administrative case against petitioner Reyes was not yet final and executory and therefore could not be used as basis for his disqualification. Invoking the ruling in the case of Aguinaldo v. Santos, petitioner argues that his election on May 8, 1995 is a bar to his disqualification.

Garcia, who obtained the highest number of votes next to Reyes, intervened, contending that because Reyes was disqualified, he was entitled to be proclaimed mayor. The Comelec en banc denied Garcia’s prayer.

ISSUES:

1. WON the decision of the Sangguniang Panlalawigan is not yet final because he has not been served a copy thereof.

2. WON petitioner’s reelection rendered the administrative charges against him moot and academic

3. WON the candidate who obtains the second highest number of votes may not be proclaimed winner in case the winning candidate is disqualified.

HELD:

1. No. The failure of the Sangguniang Panlalawigan to deliver a copy of its decision was due to the refusal of petitioner and his counsel to receive the decision. Repeated attempts had been made to serve the decision on Reyes personally and by registered mail, but Reyes refused to receive the decision. If a judgment or decision is not delivered to a party for reasons attributable to him, service is deemed completed and the judgment or decision will be considered validly served as long as it can be shown that the attempt to deliver it to him would be valid were it not for his or his counsel's refusal to receive it. Reyes’s refusal to receive the decision may, therefore, be construed as a waiver on his part to have a copy of the decision.

Petitioner was given sufficient notice of the decision. Rather than resist the service, he should have received the decision and taken an appeal to the Office of the President in accordance with R.A. No. 7160 Section 67. But petitioner did not do so. Accordingly, the decision became final 30 days after the first service upon petitioner. Thus, when the elections were held the decision of the Sangguniang Panlalawigan had already become final and executory. The filing of a petition for certiorari with the RTC did not prevent the administrative decision from attaining finality. An original action of certiorari is an independent action and does not interrupt the course of the principal action nor the running of the reglementary period involved in the proceeding.

Consequently, to arrest the course of the principal action during the pendency of the certiorari proceedings, there must be a restraining order or a writ of preliminary injunction from the appellate court directed to the lower court.  In the case at bar, although a temporary restraining order was issued by the Regional Trial Court, no preliminary injunction was subsequently issued. The temporary restraining order issued expired after 20 days. From that moment on, there was no more legal barrier to the service of the decision upon petitioner.

2.  No. Petitioner invokes the ruling in Aguinaldo v. COMELEC, in which it was held that a public official could not be removed for misconduct committed during a prior term and that his reelection operated as a condonation of the officer’s previous misconduct to the extent of cutting off the right to remove him therefor. But that was because in that case, before the petition questioning the validity of the administrative decision removing petitioner could be decided, the term of office during which the alleged misconduct was committed expired. Removal cannot extend beyond the term during which the alleged misconduct was committed.  If a public official is not removed before his term of office expires, he can no longer be removed if he is thereafter reelected for another term.  This is the rationale for the ruling in the two Aguinaldo cases.

The case at bar is the very opposite of those cases.  Here, although petitioner Reyes brought an action to question the decision in the administrative case, the temporary restraining order issued in the action he brought lapsed, with the result that the decision was served on petitioner and it thereafter became final on April 3, 1995, because petitioner failed to appeal to the Office of the President.  He was thus validly removed from office and, pursuant to § 40 (b) of the Local Government Code, he was disqualified from running for reelection.

It is noteworthy that at the time the Aguinaldo cases were decided there was no provision similar to § 40 (b) which disqualifies any person from running for any elective position on the ground that he has been removed as a result of an administrative case.  The Local Government Code of 1991 (R.A. No. 7160) could not be given retroactive effect.

Indeed, it appears that petitioner was given sufficient opportunity to file his answer.  He failed to do so.  Nonetheless, he was told that the complainant would be presenting his evidence and that he (petitioner) would then have the opportunity to cross-examine the witnesses.  But on the date set, he failed to appear.  He would say later that this was because he had filed a motion for postponement and was awaiting a ruling thereon.  This only betrays the pattern of delay he employed to render the case against him moot by his election.

3. The candidate who obtains the second highest number of votes may not be proclaimed winner in case the winning candidate is disqualified. To simplistically assume that the second placer would have received the other votes would be to substitute our judgment for the mind of the voter. The second placer is just that, a second placer.  He lost the elections.  He was repudiated by either a majority or plurality of voters. He could not be considered the first among qualified candidates because in a field which excludes the disqualified candidate, the conditions would have substantially changed.  We are not prepared to extrapolate the results under the circumstances. The votes cast for Reyes are presumed to have been cast in the belief that Reyes was qualified and for that reason cannot be treated as stray, void, or meaningless. The subsequent finding that he is disqualified cannot retroact to the date of the elections so as to invalidate the votes cast for him.

● Rule 13, §§ 3 and 7 of the Rules of Court provide for the service of final orders and judgments either personally or by mail.  Personal service is completed upon actual or constructive delivery, which may be made by delivering a copy personally to the party or his attorney, or by leaving it in his office with a person having charge thereof, or at his residence, if his office is not known. Hence service was completed when the decision was served upon petitioner’s counsel in his office in Manila on March 3, 1995. 

In addition, as the secretary of the Sangguniang Panlalawigan certified, service by registered mail was also made on petitioner Reyes. Although the mail containing the decision was not claimed by him, service was deemed completed five days after the last notice to him on March 27, 1995.

If a judgment or decision is not delivered to a party for reasons attributable to him, service is deemed completed and the judgment or decision will be considered validly served as long as it can be shown that the attempt to deliver it to him would be valid were it not for his or his counsel’s refusal to receive it.

Indeed that petitioner’s counsel knew that a decision in the administrative case had been rendered is evident in his effort to bargain with the counsel for the Sangguniang Panlalawigan not to have the decision served upon him and his client while their petition for certiorari in the Regional Trial Court was pending. His refusal to receive the decision may, therefore, be construed as a waiver on his part to have a copy of the decision.

The purpose of the rules on service is to make sure that the party being served with the pleading, order or judgment is duly informed of the same so that he can take steps to protect his interests, i.e., enable a party to file an appeal or apply for other appropriate reliefs before the decision becomes final.

In practice, service means the delivery or communication of a pleading, notice or other papers in a case to the opposite party so as to charge him with receipt of it, and subject him to its legal effect.

In the case at bar, petitioner was given sufficient notice of the decision.  Prudence required that, rather than resist the service, he should have received the decision and taken an appeal to the Office of the President in accordance with R.A. No. 7160, § 67. But petitioner did not do so.  Accordingly, the decision became final on April 2, 1995, 30 days after the first service upon petitioner.

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