MALACAANG Manila

PRESIDENTIAL DECREE No. 242 July 9, 1973

PRESCRIBING THE PROCEDURE FOR ADMINISTRATIVE SETTLEMENT OR ADJUDICATION OF DISPUTES, CLAIMS AND CONTROVERSIES BETWEEN OR AMONG GOVERNMENT OFFICES, AGENCIES AND INSTRUMENTALITIES, INCLUDING GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS, AND FOR OTHER PURPOSES WHEREAS, it is necessary in the public interest to provide for the administrative settlement or adjudication of disputes, claims and controversies between or among government offices, agencies and instrumentalities, including government-owned or controlled corporations, to avoid litigation in court where government lawyers appear for such litigants to espouse and protect their respective interests altho, in the ultimate analysis, there is but one real party in interest the Government itself in such litigations; WHEREAS, court cases involving the said government entities and instrumentalities have needlessly contributed to the clogged dockets of the courts, aside from dissipating or wasting the time and energies not only of the courts but also of the government lawyers and the considerable expenses incurred in the filing and prosecution of judicial actions; WHEREAS, all the aforementioned offices, agencies, and instrumentalities are under the executive control and supervision of the President of the Philippines; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by the powers vested in me by the Constitution as Commander-in-Chief of all the Armed Forces of the Philippines and pursuant to Proclamation No. 1081 dated September 21, 1972 and General Order No. 1 dated September 22, 1972, as amended, do hereby order and decree; Section 1. Provisions of law to the contrary notwithstanding, all disputes, claims and controversies solely between or among the departments, bureaus, offices, agencies and instrumentalities of the National Government, including constitutional offices or agencies, arising from the interpretation and application of statutes, contracts or agreements, shall henceforth be administratively settled or adjudicated as provided hereinafter: Provided, That this shall not apply to cases already pending in court at the time of the effectivity of this decree. Section 2. In all cases involving only questions of law, the same shall be submitted to and settled or adjudicated by the Secretary of Justice, as Attorney General and ex officio legal adviser of all government-owned or controlled corporations and entities, in consonance with section 83 of the Revised Administrative Code. His ruling or determination of the question in each case shall be conclusive and binding upon all the parties concerned. Section 3. Cases involving mixed questions of law and of fact or only factual issues shall be submitted to and settled or adjudicated by: (a) The Solicitor General, with respect to disputes or claims controversies between or among the departments, bureaus, offices and other agencies of the National Government; (b) The Government Corporate Counsel, with respect to disputes or claims or controversies between or among the government-owned or controlled corporations or entities being served by the Office of the Government Corporate Counsel; and

(c) The Secretary of Justice, with respect to all other disputes or claims or controversies which do not fall under the categories mentioned in paragraphs (a) and (b). Section 4. In the settlement or adjudication of the aforementioned cases, the Secretary of Justice or the Solicitor General or the Government Corporate Counsel may in his discretion refer to an arbitration panel the determination of questions of fact. The duly designated representative of the Secretary of Justice, Solicitor General or Government Corporate Counsel, as the case may be, shall act as Chairman of such panel. Section 5. The decisions of the Secretary of Justice, as well as those of the Solicitor General or the Government Corporate Counsel, when approved by the Secretary of Justice, shall be final and binding upon the parties involved. Appeals may be taken to and entertained by the Office of the President only in cases wherein the amount of the claim or value of the property exceeds P1 million. The decisions of the Office of the President on appeal cases shall be final. Section 6. The final decisions rendered in the settlement or adjudication of all such disputes, claims or controversies shall have the same force and effect as final decisions of the court of justice. Section 7. The Secretary of Justice is hereby authorized to promulgate such rules as he may deem necessary to carry out or implement the provisions of this decree. Section 8. This Decree shall take effect upon its promulgation. Done in the City of Manila, this 9th day of July, in the year of Our Lord, nineteen hundred and seventy-three.

EO 292 Revised Administrative Code of 1987

CHAPTER 14 Controversies Among Government Offices and Corporations SECTION 66. How Settled.All disputes, claims and controversies, solely between or among the departments, bureaus, offices, agencies and instrumentalities of the National Government, including government-owned or controlled corporations, such as those arising from the interpretation and application of statutes, contracts or agreements, shall be administratively settled or adjudicated in the manner provided in this Chapter. This Chapter shall, however, not apply to disputes involving the Congress, the Supreme Court, the Constitutional Commissions, and local governments. SECTION 67. Disputes Involving Questions of Law. All cases involving only questions of law shall be submitted to and settled or adjudicated by the Secretary of Justice as Attorney-General of the National Government and as ex officio legal adviser of all government-owned or controlled corporations. His ruling or decision thereon shall be conclusive and binding on all the parties concerned. SECTION 68. Disputes Involving Questions of Fact and Law.Cases involving mixed questions of law and of fact or only factual issues shall be submitted to and settled or adjudicated by: (1) The Solicitor General, if the dispute, claim or controversy involves only departments, bureaus, offices and other agencies of the National Government as well as government-owned or controlled corporations or entities of whom he is the principal law officer or general counsel; and (2) The Secretary of Justice, in all other cases not falling under paragraph (1). SECTION 69. Arbitration.The determination of factual issues may be referred to an arbitration panel composed of one representative each of the parties involved and presided over by a representative of the Secretary of Justice or the Solicitor General, as the case may be. SECTION 70. Appeals.The decision of the Secretary of Justice as well as that of the Solicitor General, when approved by the Secretary of Justice, shall be final and binding upon the parties involved. Appeals may, however, be taken to the President where the amount of the claim or the value of the property exceeds one million pesos. The decision of the President shall be final. SECTION 71. Rules and Regulations.The Secretary of Justice shall promulgate the rules and regulations necessary to carry out the provisions of this Chapter.

DOJ ADMINISTRATIVE ORDER NO. 121 s. 1973

RULES IMPLEMENTING PRESIDENTIAL DECREE NO. 242 "PRESCRIBING THE PROCEDURE FOR ADMINISTRATIVE SETTLEMENT OR ADJUDICATION OF DISPUTES, CLAIMS AND CONTROVERSIES BETWEEN OR AMONG GOVERNMENT OFFICES, AGENCIES AND INSTRUMENTALITIES, INCLUDING GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS, AND FOR OTHER PURPOSES" Pursuant to Section 7 of Presidential Decree No. 242 dated July 10, 1973, the following rules are hereby promulgated concerning the administrative settlement or adjudication of cases referred to therein by the Secretary of Justice, the Solicitor General and the Government Corporate Counsel, as the case may be. ADSTCI SECTION 1. Any party to a dispute, claim or controversy solely between or among "the department, bureaus, offices, agencies and instrumentalities of the National Government, including government-owned or controlled corporations," arising from the "interpretation or application of statutes, contracts or agreements" may initiate the administrative proceedings for settlement or adjudication thereof as hereinafter provided. The terms "departments", "bureaus" and "offices" shall refer to the regular executive departments, bureaus and offices. The terms "agencies" and "instrumentalities" of the National Government shall include all other government bodies and entities, corporate or non-corporate, self-governing or otherwise, as well as all government-owned or controlled corporations, except the constitutional offices or agencies. SECTION 2. The petitioner shall file a petition with the proper adjudicatory office after serving upon the other party or parties, personally or by registered mail, a copy or copies of the petition and all enclosures. * Petitions involving mixed questions of law and of fact or only factual issues shall be filed with: (a) The Office of the Solicitor General, with respect to disputes or claims or controversies between or among the departments, bureaus, offices and other agencies of the National Government; ** (b) The Office of the Government Corporate Counsel, with respect to disputes or claims or controversies between or among the government-owned or controlled corporations or entities being served by the said Office; *** (c) The Office of the Secretary of Justice, with respect to all other disputes or claims or controversies which do not fall under the categories mentioned in paragraphs (a) and (b). Petitions raising only questions of law shall be filed with the Office of the Secretary of Justice. SECTION 3. The petition, which shall be signed by the chief of office/bureau/agency and approved by the Department Head, shall state the names and addresses of all the parties, the legal question or questions, the factual issue or issues, if any, and the relief sought. SECTION 4. The respondent or respondents shall answer the petition within a period of ten (10) days from receipt of the petition, furnishing all parties with a copy each of the answer. SECTION 5. Upon receipt of the answer or answers, a preliminary conference shall be called by the adjudicatory office to discuss an amicable settlement or compromise. If no agreement is reached at such conference, the conferees shall immediately proceed to pinpoint and formulate the principal or determinative issue or issues, legal

and factual, to be resolved in the adjudication of the dispute, claim or controversy, and the parties shall be asked to submit an agreed statement or stipulation of facts. In the event of failure of a party to attend such conference, the petition may be dismissed or the same shall be deemed submitted for decision after the reception of the evidence of the attending party or parties and such other evidence as may be necessary for the adjudicatory office to render a just and equitable decision on the case. Or judgment on the pleadings or summary judgment may be rendered if warranted by the pleadings and supporting affidavits and papers. SECTION 6. The formal taking of testimony of witnesses may be dispensed with whenever the questions of fact raised can be resolved by means of affidavits, counter-affidavits and documentary evidence. The affiants may, however, be asked by the adjudicatory office some clarificatory questions or required to answer written interrogatories of the adverse party or parties. SECTION 7. Difficult or complicated factual issues, especially those relating to technical matters, may be referred to an arbitration panel to be designated by the adjudicatory office. The representative of the adjudicatory office shall act as chairman of the panel. Such panel, however, shall not be bound by the procedure and rules found in the arbitration law except insofar as its application to the proceedings is practicable. As a general rule, the findings of fact of such panel shall be accepted as final and only questions of law arising therefrom shall be considered in the adjudication of the case. SECTION 8. With respect to cases filed with the Office of the Solicitor General or Office of the Government Corporate Counsel, if it appears indubitably from the pleadings that the only issue presented is a question of law, the same shall be forwarded to the Secretary of Justice for his consideration and appropriate action. TIaCAc SECTION 9. A motion for reconsideration may be filed by the party adversely affected by a decision within ten (10) days from receipt of a copy thereof. In cases adjudicated by the Solicitor General and the Government Corporate Counsel the decision, together with the records of the case, shall be immediately forwarded to the Secretary of Justice upon the expiration of the said period if no motion for reconsideration has been filed. Otherwise, the same shall be so transmitted after the resolution of the motion for reconsideration. The decision in such cases shall become final and executory upon its approval by the Secretary of Justice. In the event of disapproval, the decision rendered upon review shall become final and executory as provided in the next paragraph. In cases adjudicated by the Secretary of Justice, the decision shall become final and executory upon the expiration of the said period, if no motion for reconsideration has been filed. Otherwise, it shall become final and executory upon receipt by the movant of a copy of the resolution of the motion. SECTION 10. In cases where the amount of the claim or the value of the property involved exceeds one million pesos, an appeal may be taken to the Office of the President by filing a notice of appeal and serving the same upon all parties within a period of ten (10) days from receipt of a copy of the final action taken by the Secretary of Justice. In such event, the decision shall become final and executory only upon affirmation by the Office of the President. If no appeal is taken within the said period, the final decision taken in the case shall become immediately executory upon the expiration of the said period. DACIHc SECTION 11. Proceedings under Presidential Decree No. 242 shall be summary in nature and the adjudicatory office shall act according to the substantial merits of the case without regard to technicalities or legal forms, and shall not be bound by the technical rules of procedure and evidence. The said office may inform its mind in such manner as may be deemed just and equitable.

SECTION 12. In cases filed with the Office of the Solicitor General and the Office of the Government Corporate Counsel, the parties may appear thru their duly authorized representatives or their respective legal officers. In cases to be adjudicated by the Secretary of Justice, the parties shall be represented by the Office of the Solicitor General or the Office of the Government Corporate Counsel or the Legal Department of independent entities or agencies, as the case may be. SECTION 13. All proceedings under Presidential Decree No. 242 shall be of record. The adjudicatory office shall each designate a responsible officer who shall perform all the duties devolving upon a clerk of court and act as custodian of all records relative to such proceedings. SECTION 14. All necessary and incidental expenses incurred in every proceeding for the settlement or adjudication of disputes, claims or controversies under said Decree shall, as in arbitration cases, be assessed against all or some of the parties thereto, or against one of them, if the facts and circumstances so warrant. Whenever convenient, the adjudicatory office may initially require the parties to contribute to a common fund for such expenses, subject to such adjustment later on based on the final assessment made by the adjudicatory office against the party or parties upon the termination of the proceedings. SECTION 15. The officer deputized or designated by the head of the adjudicatory office to take charge of the hearing of a case shall exercise the same rights and powers conferred by law upon an administrative or non-judicial officer authorized to take testimony or evidence. Persons who, without lawful excuse, fail or refuse to obey orders issued in the said hearing shall be dealt with in accordance with law, without prejudice to further administrative action against public officers or employees pursuant to civil service law, rules and regulations. SECTION 16. The Rules of Court shall not apply to proceedings under the aforementioned Decree except by analogy or in a suppletory character, whenever practicable and convenient, and to make effective the authority vested in the adjudicatory offices. SECTION 17. Supplemental rules shall be issued from time to time as may be necessary to ensure the fair and expeditious disposition of cases. July 25, 1973.

(SGD.) VICENTE ABAD SANTOS Secretary of Justice

MANILA

ADMINISTRATIVE ORDER NO. 130

DELINEATING THE FUNCTIONS AND RESPONSIBILITIES OF THE OFFICE OF THE SOLICITOR GENERAL AND THE OFFICE OF THE GOVERNMENT CORPORATE COUNSEL WHEREAS, [t]he Office of the Government Corporate Counsel shall act as the principal law office of all government owned or controlled corporations, their subsidiaries, other corporate offsprings and government acquired asset corporations and shall exercise control and supervision over all legal departments or divisions maintained separately and such powers and functions as are now or may hereafter be provided by law . . . (Section 10, Chapter 3, Title III, Book IV of Executive Order No. 292 [Administrative Code of 1987]); WHEREAS, [t]he Office of the Solicitor General shall represent the Government of the Philippines, its agencies and instrumentalities and its officials and agents in any litigation, proceeding, investigation or matter requiring the services of a lawyer. When authorized by the President or head of the office concerned, it shall also represent governmentowned or controlled corporations . . . (Section 35, Chapter 12, Title III, Book IV of Executive Order No. 292 [Administrative Code of 1987]); and WHEREAS, the Solicitor General is also the legal counsel of certain government-owned or controlled corporations by virtue of their respective charters. NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order: Section 1. All legal matters pertaining to government-owned or controlled corporations, their subsidiaries, other corporate offsprings and government acquired asset corporations (hereinafter collectively referred to as GOCC) shall be exclusively referred to and handled by the Office of the Government Corporate Counsel (hereinafter referred to as GOCC), unless their respective charters expressly name the Office of the Solicitor General (hereinafter referred to as OSG) as their legal counsel. When authorized by the President, or by the head of the office concerned and approved by the President, the OSG shall also represent GOCCs. Section 2. Subject to the provisions of Section 3 hereof, all pending cases of GOCCs being handled by the OSG, and all pending requests for opinions and contract reviews which have been referred by said GOCCs to the OSG, may be retained and acted upon by the OSG at its discretion, until their termination: Provided, that the OSG shall inform the OGCC of these pending cases, requests for opinions and contract reviews, if any, to ensure proper monitoring and coordination. Section 3. Provisions of other executive issuances inconsistent herewith are hereby repealed or modified accordingly. Section 4. This Administrative Order shall take effect immediately. DONE in the City of Manila, this 19 day of May in the year of Our Lord, Nineteen Hundred and Ninety-Four. (Sgd.) FIDEL V. RAMOS By the President: (Sgd.) TEOFISTO T. GUINGONA, JR. Executive Secretary
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MALACAANG Manila
BY THE PRESIDENT OF THE PHILIPPINES

EXECUTIVE ORDER NO. 596

DEFINING AND INCLUDING GOVERNMENT INSTRUMENTALITY VESTED WITH CORPORATE POWERS OR GOVERNMENT CORPORATE ENTITIES UNDER THE JURISDICTION OF THE OFFICE OF THE GOVERNMENT CORPORATE COUNSEL (OGCC) AS PRINCIPAL LAW OFFICE OF GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS (GOCCs) AND FOR OTHER PURPOSES WHEREAS, the Office of the Government Corporate Counsel (OGCC), as the principal law office of all GovernmentOwned or Controlled Corporations (GOCCs), including their subsidiaries, other corporate offsprings and government acquired assets corporations, plays a very significant role in safeguarding the legal interests and providing the legal requirements of all GOCCs; WHEREAS, there is an imperative need to integrate, strengthen and rationalize the powers and jurisdiction of the OGCC in the light of the Decision of the Supreme Court date d July 20, 2006, in the case of Manila International Airport Authority vs. Court of Appeals, City of Paraaque, et al. (G.R. No. 155650), where the High Court differentiated government corporate entities and government instrumentalities with corporate powers from GOCCs for purposes of the provisions of the Local Government Code on real estate taxes, and other fees and charges imposed by local government units; WHEREAS, in the interest of an effective administration of justice, the application and defi nition of the term GOCCs need to be further clarified and rationalized, to have consistency in referring to the term and to avoid unintended conflicts and/or confusion; NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order: SECTION 1. The Office of the Government Corporate Counsel (OGCC) shall be the principal law office of all GOCCs, except as may otherwise be provided by their respective charter or authorized by the President, their subsidiaries, corporate offsprings, and government acquired asset corporations. The OGCC shall likewise be the principal law office of government instrumentality vested with corporate powers or government corporate entity, as defined by the Supreme Court in the case of MIAA vs. Court of Appeals, City of Paraaque, et al., supra, notable examples of which are: Manila International Airport Authority (MIAA), Mactan International Airport Authority, the Philippine Ports Authority (PPA), Philippine Deposit Insurance Corporation (PDIC), Metropolitan Water and Sewerage Services (MWSS), Philippine Rice Research Institute (PRRI), Laguna Lake Development Authority (LLDA), Fisheries Development Authority (FDA), Bases Conversion Development Authority (BCDA), Cebu Port Authority (CPA), Cagayan de Oro Port Authority, and San Fernando Port Authority. SECTION 2. As provided under PD 2029, series of 1986, the term GOCCs is defined as a stock or non-stock corporation, whether performing governmental or proprietary functions, which is directly chartered by a special law or if organized under the general corporation law, is owned or controlled by the government directly, or indirectly, through a parent corporation or subsidiary corporation, to the extent of at least a majority of its outstanding capital stock or of its outstanding voting capital stock. Under Section 2(10) of the Introductory Provisions of the Administrative Code of 1987, a government instrumentality refers to any agency of the National Government, not integrated within the department framework, vested with special functions or jurisdiction by law; endowed with some, if not all corporate powers, administering special funds, and enjoying operational autonomy, usually through a charter. SECTION 3. The following corporations are considered GOCCs under the conditions and/or circumstances indicated:

a) A corporation organized under the general corporation law under private ownership at least a majority of the shares of stock of which were conveyed to a government financial institution, whether by foreclosure or otherwise, or a subsidiary corporation of a government corporation organized exclusively to own and manage, or lease, or operate specific assets acquired by a government financial institution in satisfaction of debts incurred therewith, and which in any case by enunciated policy of the government is required to be disposed of to private ownership within a specified period of time, shall not be considered a GOCC before such disposition and even if the ownership or control thereof is subsequently transferred to another GOCC; b) A corporation created by special law which is explicitly intended under that law for ultimate transfer to private ownership under certain specified conditionsshall be considered a GOCC, until it is transferred to private ownership; c) A corporation that is authorized to be established by special law, but which is still required under that law to register with the Securities and Exchange Commission in order to acquire a juridical personality, shall not, on the basis of the special law alone, be considered a GOCC. SECTION 4. The terms parent corporation, subsidiary and/or affiliate shall have the following meanings and legal signification: a) A parent corporation is one which is created by special law; b) A subsidiary corporation is one organized under the general corporation law (1) under private ownership at least a majority of the shares of stock of which were conveyed to a government corporation in satisfaction of debts incurred with a government financial institution, whether by foreclosure or otherwise, or (2) as a subsidiary corporation of a government corporation organized exclusively to own and manage, or lease, or operate specific physical assets acquired by the government financial institution in satisfaction of debts incurred therewith, and which in any case by enunciated policy of the government is required to be disposed of to private ownership within a specified period of time; c) An affiliate corporation is one where total government ownership comprises less than the majority of its outstanding capital stock and its outstanding voting capital stock. SECTION 5. All executive issuances, rules and regulations or parts thereof, which are inconsistent with this Executive Order, are hereby repealed or modified accordingly. SECTION 6. This Executive Order shall take effect after fifteen (15) days from date of publication in a national newspaper of general circulation, DONE in the City of Manila, on this 29 day of December in the year of Our Lord, Two Thousand and Six. (Sgd.) GLORIA MACAPAGAL-ARROYO By the President:
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(Sgd.) EDUARDO R. ERMITA

Executive Secretary