1. Republic v. Drugmaker's Laboratories, Inc., G.R.

An administrative regulation may be classified as a introduced the BA/BE testing requirement as a

No. 190837, [March 5, 2014] legislative rule, an interpretative rule or a contingent component of applications for the issuamce of CPR
rule. Legislative rules are in the nature of subordinate covering certain pharmaceutical products as such, it is
legislation a d designed to implement a primary considered an administrative regulation – a legislative
Facts: The FDA was created pursuant to RA 3720,
legislation by providing the details thereof. They usually rule to be exact – issued by the Secretary of Health in
otherwise known as the “Food, Drug and Cosmetics Act”
implement existing law, imposing general, extra- consonance with the express authority granted to him
primarily in order to establish safety or efficacy
statutory obligations pursuant to authority properly by RA 3720 to implement the statutory mandate that all
standards and quality measure of foods, drugs and
delegated by the congress amd effect a change in drugs and devices should first be registered with the
devices and cosmetics products. On March 15, 1989, the
existing law or policy which affect individual rights and FDA prior to their manufacture and sale. Considering
Department of Health, thru then Secretary Alfredo RA
obligations. Meanwhile, interpretative rules are intended that neither party contested the validity of its issuance,
Bengzon issued AO 67 s. 1989, entitled Revised Rules
to interpret, clarify or explain existing statutory the court deems that AO 67 complied with the
and Regulations on Registration of Pharmaceutical
regulations under which the administrative body requirements of prior hearing, notice and publication
products. Among others, it required drug manufacturers
operates. Their purpose or objective is merely to pursuant to the presumption of regularity accorded tl the
to register certain drug and medicine products with FDA
construe the statue being administered and purpory to govt in the exercise of its official duties.
before they may release the same to the market for
do no more than interpret the statute. Simply, they try
sale. In this relation, a satisfactory
to say what the statute means and refer to no single On the other hand, circulars no. 1 and 8 s. of 1997
bioavailability/bioequivalence (BA/BE) test is needed for
person or party in particular but concern all those cannot be considered as administrative regulations
a manufacturer to secure a CPR for these products.
belonging to the same class which may be covered by because they do not: a.) implement a primary legislation
However, the implementation of the BA/BE testing
the said rules. Finally, contingent rules are those issued by providing the details thereof; b.) Interpret, clarify or
requirement was put on hold because there was no local
by an administrative authority based on the existence of explain existing statutory regulation under which FDA
facility capable of conducting the same. The issuance of
certain facts or things upon which the enforcement of operates and/or; c.) Ascertain the existence of certain
circulars no. 1 s. of 1997 resumed the FDA’s
the law depends. facts or things upon which the enforcement of RA 3720
implementation of the BA/BE testing requirement with
the establishment of BA/BE testing facilities in the depends. In fact, the only purpose of these is for FDA to
country. Thereafter, the FDA issued circular no. 8 s. of In general, an administrative regulation needs to comply administer and supervise the implementation of the
1997 which provided additional implementation details with the requirements laid down by EO 292 s. of 1988 provisions of AO 67 s. of 1989 including those covering
concerning the BA/BE testing requirement on drug otherwise known as the administrative code of 1987 on the BA/BE testing requirement consistent with and
products. prior notice, hearing and publication in order to be valid pursuant to RA 3720. Therefore, the FDA has sufficient
and binding except when the same is merely an authority to issue the said circulars and since theu would
interpretative rule. This is because when an not affect the substantive rights of the parties that they
Issue: Whether or not the circular issued by FDA are
administrative rule is merely intepretative in nature its seek to govern – as they are not, strictly speaking,
valid.
applicability needs nothing further than its bare administrative regulations in the first place – no prior
issuance, for it gives no real consequence more than hearing, consultation and publication are needed for
Held: Yes. Administrative agencies may exercise quasi- what the law itself has already prescribed. When, on the their validity.
legislative or rule-making power only if there exist a law other hand, the administrative rule goes beyond merely
which delegates these powers to them. Accordingly, the providing for the means that ca facilitate or render least
rules so promulgated must be within the confines of the cumbersome the implementation of the law but
granting statutes and must not involve discretion as to substantially increases the burden of those governed, it
what the law shall be, but merely the authority to fix the behooves the agency to accord at least to those directly
details in the execution or enforcement of the policy set affected a chance to be heard, and thereafter to be duly
out in the law itself, so as to conform with the doctrine informed before that new issuance is given the force and
of separation of powers and as an adjunct, the doctrine effect of law.
of non-delegability of legislative powers.
A careful scrutiny of the foregoing issuances would
reveal that A0 67 is actually the rule that originally
2. Executive Secretary v. Southwing Heavy (2) It must be promulgated in accordance with the Delegation of legislative powers to the President is
Industries, Inc., G.R. Nos. 164171, 164172 & prescribed procedure; permitted in Section 28(2) of Article VI of the
168741, [February 20, 2006], 518 PHIL 103-133 Constitution. It provides:
(3) It must be within the scope of the authority given by
the legislature; and (2) The Congress may, by law, authorize the President
to fix within specified limits, and subject to such
(4) It must be reasonable. limitations and restrictions as it may impose, tariff rates,
FACTS: import and export quotas, tonnage and wharfage dues,
• Did the EO 156 actually satisfy the four? and other duties or imposts within the framework of the
On December 12, 2002, President Gloria Macapagal- national development program of the Government.
Arroyo issued EO 156, entitled "PROVIDING FOR A
COMPREHENSIVE INDUSTRIAL POLICY AND RULING:
The relevant statutes to execute this provision are:
DIRECTIONS FOR THE MOTOR VEHICLE DEVELOPMENT
PROGRAM AND ITS IMPLEMENTING GUIDELINES." Police power is inherent in a government to enact laws,
within constitutional limits, to promote the order, safety, (1) The Tariff and Customs Code which authorizes the
health, morals, and general welfare of society. It is President, in the interest of national economy, general
The challenged provision states that the importation into welfare and/or national security, to, inter alia, prohibit
the country, inclusive of the Freeport, of all types of lodged primarily with the legislature. By virtue of a valid
delegation of legislative power, it may also be exercised the importation of any commodity.
used motor vehicles is prohibited, except those
enumerated under the said law. by the President and administrative boards, as well as
the lawmaking bodies on all municipal levels, including (2) Executive Order No. 226, the Omnibus Investment
the barangay. Such delegation confers upon the Code of the Philippines empowers the President to
The issuance of EO 156 spawned three separate actions approve or reject the prohibition on the importation of
President quasi-legislative power which may be defined
for declaratory relief before Branch 72 of the Regional any equipment or raw materials or finished products.
as the authority delegated by the law-making body to
Trial Court of Olongapo City, all seeking the declaration
the administrative body to adopt rules and regulations
of the unconstitutionality of Article 2, Section 3.1 of said
intended to carry out the provisions of the law and (3) Republic Act No. 8800, otherwise known as the
executive order.
implement legislative policy. To be valid, an "Safeguard Measures Act" (SMA), and entitled "An Act
administrative issuance, such as an executive order, Protecting Local Industries By Providing Safeguard
Petitioners are now before the Supreme Court must comply with the following requisites: Measures To Be Undertaken In Response To Increased
contending that Article 2, Section 3.1 of EO 156 is valid Imports And Providing Penalties For Violation Thereof,"
and applicable to the entire country, including the designated the Secretaries of the DTI and the
1) Its promulgation must be authorized by the
Freeeport. In support of their arguments, they raise Department of Agriculture, in their capacity as alter egos
legislature;
procedural and substantive issues bearing on the of the President, as the implementing authorities of the
constitutionality of the assailed proviso. safeguard measures, which include, inter alia,
2) It must be promulgated in accordance with the
prescribed procedure; modification or imposition of any quantitative restriction
ISSUE: on the importation of a product into the Philippines.
3) It must be within the scope of the authority given by
• To be valid, an administrative issuance, such There are thus explicit constitutional and statutory
the legislature; and
as an executive order, must comply with the following permission authorizing the President to ban or regulate
requisites: importation of articles and commodities into the country.
4) It must be reasonable.
(1) Its promulgation must be authorized by the Anent the second requisite, that is, that the order must
legislature; EO 156 actually satisfied the first requisite of a valid
be issued or promulgated in accordance with the
administrative order. It has both constitutional and
prescribed procedure, it is necessary that the nature of
statutory bases.
the administrative issuance is properly determined. As
in the enactment of laws, the general rule is that, the complied with the procedures and limitations imposed by which they may import or export into and out of the
promulgation of administrative issuances requires law. zone. A contrary interpretation would defeat the very
previous notice and hearing, the only exception being purpose of the Freeport and drive away investors.
where the legislature itself requires it and mandates that To determine whether EO 156 has complied with the
the regulation shall be based on certain facts as third and fourth requisites of a valid administrative It does not mean, however, that the right of Freeport
determined at an appropriate investigation. This issuance, to wit, that it was issued within the scope of enterprises to import all types of goods and article is
exception pertains to the issuance of legislative rules as authority given by the legislature and that it is absolute. Such right is of course subject to the limitation
distinguished from interpretative rules which give no real reasonable, an examination of the nature of a Freeport that articles absolutely prohibited by law cannot be
consequence more than what the law itself has already under RA 7227 and the primordial purpose of the imported into the Freeport.
prescribed; and are designed merely to provide importation ban under the questioned EO is necessary.
guidelines to the law which the administrative agency is From the foregoing discussions, the Court held that the
in charge of enforcing. A legislative rule, on the other RA 7227 was enacted providing for, among other things, importation ban runs afoul the third requisite for a valid
hand, is in the nature of subordinate legislation, crafted the sound and balanced conversion of the Clark and administrative order. To be valid, an administrative
to implement a primary legislation. Subic military reservations and their extensions into issuance must not be ultra vires or beyond the limits of
alternative productive uses in the form of Special the authority conferred. It must not supplant or modify
In the instant case, EO 156 is obviously a legislative rule Economic and Freeport Zone, or the Subic Bay Freeport, the Constitution, its enabling statute and other existing
as it seeks to implement or execute primary legislative in order to promote the economic and social laws, for such is the sole function of the legislature
enactments intended to protect the domestic industry by development of Central Luzon in particular and the which the other branches of the government cannot
imposing a ban on the importation of a specified product country in general. usurp.
not previously subject to such prohibition. The due
process requirements in the issuance thereof are The Freeport was designed to ensure free flow or In the instant case, the subject matter of the laws
embodied in Section 401 of the Tariff and Customs Code movement of goods and capital within a portion of the authorizing the President to regulate or forbid
and Sections 5 and 9 of the SMA which essentially Philippine territory in order to attract investors to invest importation of used motor vehicles, is the domestic
mandate the conduct of investigation and public their capital in a business climate with the least industry. EO 156, however, exceeded the scope of its
hearings before the regulatory measure or importation governmental intervention. application by extending the prohibition on the
ban may be issued. importation of used cars to the Freeport, which RA 7227,
With minimum interference from the government, considers to some extent, a foreign territory. The
In the present case, respondents neither questioned investors can, in general, engage in any kind of business domestic industry which the EO seeks to protect is
before this Court nor with the courts below the as well as import and export any article into and out of actually the "customs territory" which is defined under
procedure that paved the way for the issuance of EO the Freeport. These are among the rights accorded to the Rules and Regulations Implementing RA 7227.
156. What they challenged in their petitions before the Subic Bay Freeport Enterprises under Section 39 of the
trial court was the absence of "substantive due process" Rules and Regulations Implementing RA 7227. This brings us to the fourth requisite. It is an axiom in
in the issuance of the EO. Their main contention before administrative law that administrative authorities should
the court a quo is that the importation ban is illogical not act arbitrarily and capriciously in the issuance of
However, contrary to the claim of petitioners, there is
and unfair because it unreasonably drives them out of rules and regulations. To be valid, such rules and
nothing in the foregoing excerpts which absolutely limits
business to the prejudice of the national economy. regulations must be reasonable and fairly adapted to
the incentive to Freeport investors only to exemption
from customs duties and taxes. Mindful of the secure the end in view. If shown to bear no reasonable
Considering the settled principle that in the absence of legislative intent to attract investors, enhance relation to the purposes for which they were authorized
strong evidence to the contrary, acts of the other investment and boost the economy, the legislature could to be issued, then they must be held to be invalid.
branches of the government are presumed to be valid, not have limited the enticement only to exemption from
and there being no objection from the respondents as to taxes. The minimum interference policy of the There is no doubt that the issuance of the ban to protect
the procedure in the promulgation of EO 156, the government on the Freeport extends to the kind of the domestic industry is a reasonable exercise of police
presumption is that said executive issuance duly business that investors may embark on and the articles power. The deterioration of the local motor
manufacturing firms due to the influx of imported used in former Subic Naval Base area as stated in Section 1.1
motor vehicles is an urgent national concern that needs of EO 97-A. Hence, used motor vehicles that come into
to be swiftly addressed by the President. In the exercise the Philippine territory via the secured fenced-in former
of delegated police power, the executive can therefore Subic Naval Base area may be stored, used or traded
validly proscribe the importation of these vehicles. therein, or exported out of the Philippine territory, but
they cannot be imported into the Philippine territory
The problem, however, lies with respect to the outside of the secured fenced-in former Subic Naval
application of the importation ban to the Freeport. The Base area.
Court finds no logic in the all encompassing application
of the assailed provision to the Freeport which is outside
the customs territory. As long as the used motor
vehicles do not enter the customs territory, the injury or
harm sought to be prevented or remedied will not
arise. The application of the law should be consistent
with the purpose of and reason for the law. Ratione
cessat lex, et cessat lex. When the reason for the law
ceases, the law ceases. It is not the letter alone but the
spirit of the law also that gives it life. To apply the
proscription to the Freeport would not serve the purpose
of the EO. Instead of improving the general economy of
the country, the application of the importation ban in the
Freeport would subvert the avowed purpose of RA 7227
which is to create a market that would draw investors
and ultimately boost the national economy.

The importation ban in this case should also be declared

void for its too sweeping and unnecessary application to
the Freeport which has no bearing on the objective of
the prohibition. If the aim of the EO is to prevent the
entry of used motor vehicles from the Freeport to the
customs territory, the solution is not to forbid entry of
these vehicles into the Freeport, but to intensify
governmental campaign and measures to thwart illegal
ingress of used motor vehicles into the customs
territory.

In sum, the Court finds that Article 2, Section 3.1 of EO

156 is void insofar as it is made applicable to the
presently secured fenced-in former Subic Naval Base
area as stated in Section 1.1 of EO 97-A. Pursuant to
the separability clause of EO 156, Section 3.1 is declared
valid insofar as it applies to the customs territory or the
Philippine territory outside the presently secured fenced-
3. Genuino v. De Lima, G.R. Nos. 197930, 199034 (WLOs) and Hold Departure Orders(HDOs). There
& 199046, [April 17, 2018] are only three considerations that may permit a
restriction on the right to travel: national security,
FACTS: public safety or public health. Further, there must be
The case is a consolidated case of Petition for Certiorari an explicit provision of statutory law or Rules of
and Prohibition against former DOJ Secretary Delima for Court providing for the impairment.
her issuance of DOJ circular no. 41. Series of 2010,
known as the “Consolidated Rules and Regulations
Governing Issuance and Implementation of Hold DOJ Circular No. 41 is not a law. It is not a
Departure Orders (HDO), Watch list Orders (WLO) and legislative enactment, but a mere administrative
Allow Departure Orders (ADO)” . The Petitioners issuance designed to carry out the provisions of an
questions the constitutionality of this DOJ circular on the enabling law. DOJ is not authorized to issue WLOs and
ground that it infringes the constitutional right to travel. HDOs to restrict the constitutional right to travel.
There is no mention of the exigencies stated in the
The petitioners in these consolidated cases are former Constitution that will justify the impairment. The
Presiden tArroyo and her husband, and Efraim and Erwin provision simply grants the DOJ the power to
Genuino. Former DOJ Secretary De lima issued HDO and investigate the commission of crimes and prosecute
WLO against petitioners on the ground that criminal offenders. It does not carry the power to
charges of plunder, qualified theft and violation of the indiscriminately devise all means it deems proper in
Omnibus Election Code were filed against them. performing its functions without regard to
Petitioners, particularly Spouses Arroyo, file temporary constitutionally-protected rights.
restraining order against the issued HDO and WLO of DOJ cannot justify the restraint in the liberty of
DOJ seeking relief and grant from court to allow them to movement imposed by the circular on the ground that
travel so that former president Arroyo may seek medical it is necessary to ensure presence and attendance in
treatment abroad. The court granted relief sought on a the preliminary investigation of the complaints. There
condition that petition will file a bond of PhP2M, an is no authority of law granting it the power to
undertaking that petitioners shall report to Philippine compel the attendance of the subjects of a
consulate in the countries they are to visit (Germany, preliminary investigation pursuant to its investigatory
Singapore, USA, Italy, Spain and Austria) and shall powers. Its investigatory power is simply inquisitorial
appoint a representative to receive on their behalf and, unfortunately, not broad enough to embrace
subpoena, orders and other legal processes. Petitioners the imposition of restraint on the liberty of
complied with all the conditions instead of following the movement.
order of the court, DOJ caused for the refusal to process
the petitioners travel documents.

ISSUE/S:
Whether or not the DOJ Circular No. 41 is
unconstitutional for being a violation of the right to
travel

RULING:
Yes. The DOJ has no authority to issue DOJ
Circular No. 41 which effectively restricts the right
to travel through the issuance of Watchlist Orders
4. Manila Public School Teachers' Association v. APL and CLIP was it non-publication validly dispensed
Garcia, G.R. No. 192708, [October 2, 2017] with?

RULING: No, the policies are invalid due to lack of

FACTS: Under the GSIS Act of 1997, the employee- publication. While GSIS filed copies of the subject
member and the employer-agency are required by law resolutions with the Office of the National Administrative
to pay monthly contributions to the system. The Register (ONAR), it only did so after the claims of the
employer is mandated to remit the GS (Government retirees and beneficiaries had already been lodged. The
share) and PS (Personal Share) directly to the GSIS resolutions were not published in either the Official
within the first 10 days of the calendar month following Gazette or a newspaper of general circulation in the
the month to which the contributions apply. The GSIS country.
Act of 1997 also increase in the employer's contribution
Furthermore, a reading of the resolutions
from 9.5% to 12%, but DepEd was unable to pay GSIS
convinces us that these cannot be viewed simply as a
the equivalent of the 2.5% increase in the employer's
construction of R.A. 8291, as they, in fact, substantially
share. Hence, DepEd incurred premium deficiencies.
increase the burden of GSIS members. In the case of
Accordingly, GSIS issued Resolutions No. 238 Veterans Federation vs Reyes, it basically provides for
(CLIP); 90 (PBP); and 179 (APL). CLIP allows the arrears the ruled that interpretative regulations that does not
incurred by members from their overdue loans are add or affect substantial rights of any person do not
deducted from the proceeds of their new loan or entail publication. However, “when the administrative
retirement benefits. PBP as Petitioners claim that the rule substantially adds to or increases the burden of
policy shifted the basis for the claims and benefits of those governed, it behooves the agency to accord at
GSIS members from the actual length of service to the least to those directly affected a chance to be heard, and
creditable years of service. While, APL, is "a feature of a thereafter to be duly informed, before that new issuance
GSIS life insurance policy that keeps the policy in force is given the force and effect of law."
in case of nonpayment of premiums by taking out a loan
In this case, the resolutions additionally obligate
amount against the unrestricted portion of the policy's
member-employees to ensure that their employer-
accumulated cash value (CV) or the termination value
agency includes the GS in the budget, deducts the PS,
(TV)" until the total APL and policy loan balances exceed
as well as loan amortizations, and timely remits them;
the CV of the Life Endowment Policy or the TV of the
and that the GSIS receives, processes, and posts the
Enhanced Life Policy.
payments. These processes are beyond the control of
These Resolutions were not published in a the employees; yet they are being made to bear the
newspaper of general circulation and were enforced consequences of any misstep or delay by either their
before they were even filed with the Office of the agency or GSIS. As aptly observed by the CA, "the fault
National Administrative Register. Petitioners seek to lies with how the deficiencies in payment by the DepEd,
nullify the resolutions for being "intrinsically real or imagined, are attributed to the employees-
unconstitutional, illegal, unjust, oppressive, arbitrary, members."
confiscatory, immoral, ultra vires, and unconscionable."

ISSUE: Considering that the parties participated in the

public consultation of GSIS’ policy resolutions on PBP,
5. Encinas v. Agustin, G.R. No. 187317, [April 11, prejudicial to the best interest of the service charges their privies in all other actions or suits, in the same or
2013], 709 PHIL 236-265 included in the CSCRO Complaint were charges that any other judicial tribunal of concurrent jurisdiction, on
were equivalent to the BFP Complaint, the subject of the points and matters in issue in the first suit.
which was his alleged violation of R.A. 6975 or illegal
transfer of personnel. In order that res judicata may bar the institution of a
Facts:
subsequent action, the following requisites must concur:
Issues: (a) the former judgment must be final; (b) it must have
Respondents were then both holding positions as Fire
been rendered by a court having jurisdiction over the
Officer I in Nueva Ecija. They claim that on 11 March
Whether or not respondents are guilty of forum- subject matter and the parties; (c) it must be a...
2000, at around 9:00 p.m., petitioner who was then
shopping. judgment on the merits; and (d) there must be between
Provincial Fire Marshall of Nueva Ecija informed them
the first and the second actions (i) identity of parties, (ii)
that unless they gave him P5,000, they would be
Ruling: identity of subject matter, and (iii) identity of cause of
relieved from their station at Cabanatuan City and
action.
transferred to far-flung areas. Respondent Alfredo P.
Agustin would supposedly be transferred to the Cuyapo In Yu v. Lim, the Court enumerated the requisites of
Fire Station, and respondent Joel S. Caubang to forum-shopping as follows: A judgment may be considered as one rendered on the
Talugtug Fire Station. merits "when it determines the rights and liabilities of
the parties based on the disclosed facts, irrespective of
Forum-shopping exists when the elements of litis
formal, technical or dilatory objections;" or when the
Fearing the reassignment, they decided to pay pendentia are present or where a final judgment in one
judgment is rendered "after a determination of which
petitioner. Respondents came up short and managed to case will amount to res judicata in another. Litis
party is right, as distinguished from a judgment
give only P2,000, prompting petitioner to direct them to pendentia requires the concurrence of the following
rendered upon some preliminary or formal or merely
come up with the balance within a week. When they requisites: (1) identity of parties, or at least such parties
technical point.
failed to deliver the balance, petitioner issued as those representing the same interests in both
instructions effectively reassigning respondents Agustin actions; (2) identity of rights asserted and reliefs prayed
and Caubang to Cuyapo and Talugtug, respectively, for, the reliefs being founded on the same facts; and (3) In this case, there is no "judgment on the merits" in
respondents filed a letter-complaint for illegal transfer of identity with respect to the two preceding particulars in contemplation of the definition above. The dismissal of
personnel under R.A. No. 6975. The record is not clear the two cases, such that any judgment that may be the BFP Complaint in the Resolution dated 05 July 2005
as to why this Complaint was later docketed by the BFP rendered in the pending case, regardless of which party was the result of a fact-finding investigation for
for preliminary investigation for violation of R.A. No. is successful, would amount to res judicata in the other purposes of determining whether a formal charge for an
3019 or the Anti-Graft and Corrupt Practices Act. case. administrative offense should be filed. Hence, no rights
and liabilities of parties were determined therein with
finality.
On 12 April and 25 April 2000, on the basis of similar Applying the foregoing requisites to this case, we rule
facts, respondents likewise filed with the CSC Regional that the dismissal of the BFP Complaint does not
Office in San Fernando, Pampanga, as well as with the constitute res judicata in relation to the CSCRO The CA was correct in ruling that the doctrine of res
CSC Field Office in Cabanatuan City, their Joint Complaint. Thus, there is no forum-shopping on the part judicata applies only to judicial or quasi-judicial
Affidavit/Complaint. This time, they accused petitioner of of respondents. proceedings, and not to the exercise of administrative
violation of Section 4(c) of R.A. No. 6713 or the Code of powers. Administrative powers here refer to those purely
Conduct and Ethical Standards for Public Officials and administrative in nature, as opposed to administrative
Res judicata means "a matter adjudged; a thing
Employees. proceedings that take on a quasi-judicial character.
judicially acted upon or decided; a thing or matter
settled by judgment." It lays down the rule that an
Petitioner argues that respondents are guilty of forum- existing final judgment or decree on the merits, In administrative law, a quasi-judicial proceeding
shopping for filing two allegedly identical Complaints in rendered without fraud or collusion by a court of involves (a) taking and evaluating evidence; (b)
violation of the rules on forum-shopping. He explains competent jurisdiction upon any matter within its determining facts based upon the evidence presented;
that dishonesty, grave misconduct, and conduct jurisdiction, is conclusive of the rights of the parties or and (c) rendering an order or decision supported by the
facts proved. The exercise of quasi-judicial functions
involves a determination, with respect to the matter in
controversy, of what the law is; what the legal rights
and obligations of the contending parties are; and based
thereon and the facts obtaining, the adjudication of the
respective rights and obligations of the parties.
6. Republic v. N. Dela Merced and Sons, Inc. GR
The Court has laid down the test for determining
201501/201658, 22 January 2018.
whether an administrative body is exercising judicial or
merely investigatory functions: adjudication signifies the
exercise of the power and authority to adjudicate upon
the rights and obligations of the parties. Hence, if the
only purpose of an investigation is to evaluate the
evidence submitted to an agency based on the facts and
circumstances presented to it, and if the agency is not
authorized to make a final pronouncement affecting the
parties, then there is an absence of judicial discretion
and judgment.

In this case, an analysis of the proceedings before the

BFP yields the conclusion that they were purely
administrative in nature and constituted a fact-finding
investigation for purposes of determining whether a
formal charge for an administrative offense should be
filed against petitioner.

The proceedings before the BFP were merely

investigative, aimed at determining the existence of
facts for the purpose of deciding whether to proceed
with an administrative action.

With the above disquisition, we rule that the dismissal of

the BFP Complaint cannot operate as res judicata.
Therefore, forum-shopping is unavailing in this case.
7. Torrecampo v. MWSG, G.R. No. 188296 On 12 March 2009, MWSS issued Board Resolution No.
2009-052 and allowed DPWH to use the 60 Meter Right-
The Facts: of-Way for preliminary studies in the implementation of
Torrecampo's constituents approached him to the C-5 Road Extension Project. DPWH entered the said
report that personnel and heavy equipment from the properties of the MWSS on 30 June 2009.
DPWH entered a portion of their Barangay to implement
the C-5 Road Extension Project over Lot Nos. 42-A-4, ISSUE: Whether respondents should be enjoined from
42-A-6 and 42-A-4. Torrecampo Alleged that if the commencing with and implementing the C-5 Road
MWSS and the DPWH are allowed to continue and Extension Project?
complete the C-5 Road Extension Project, 3 aqueducts of
the MWSS supplying water to 8 million Metro Manila HELD:
residents will be put at great risk. He Insisted that the The petition must fail.
RIPADA area is a better alternative to subject lots. Torrecampo seeks judicial review of a question of
Torrecampo thus filed the present petition. Executive policy, a matter outside this Court's
jurisdiction. Here, the issue is dependent upon the
This Court required respondents to comment. A status wisdom, not legality, of a particular measure. Thus,
quo order was issued. The hearing regarding the urgent Torrecampo wants this Court to determine whether the
application for ex-parte temporary restraining order Tandang Sora area is a better alternative to the RIPADA
and/or writ of preliminary injunction was set on 6 July area for the C-5 Road Extension Project. Such
2009. determination belongs to the Executive branch and
cannot be touched upon by this Court.
Atty. Villamor, Jr. contended that grave injustice and
irreparable injury to would result should the petition be The exception to this rule applies when there is grave
denied, the constitutional right to health would be abuse of discretion. In this case, however, the DPWH
violated, and that the petition was filed directly with the still has to conduct the proper study to determine
SC because lower courts are prohibited from issuing whether a road can be safely constructed on land
restraining orders and injunctions against government beneath which runs the aqueducts. Without such study,
infrastructure projects pursuant to R.A 8975. the MWSS, which owns the land, cannot decide whether
to allow the DPWH to construct the road. Absent such
Asst. Solicitor General Panga, for respondent DPWH, DPWH study and MWSS decision, no grave abuse of
asserts that petitioner's case does not fall under an discretion amounting to lack of jurisdiction can be
exception and thus should have followed the principle of alleged against or attributed to respondents warranting
hierarchy of courts. the exercise of this Court's extraordinary certiorari
power.
Atty. Agra for respondent MWSS finds as premature the
filing of the petition for injunction as there is yet no road
expansion project to be implemented, the project has
yet to pass prior review by the MWSS; under the
premises, there is yet no justiciable controversy.
8. Vigilar v. Aquino, G.R. No. 180388, 2011
Civil Law: The non-suability of the State also admits of
FACTS: exceptions. In this case, upholding such would lead to
Respondent was invited to bid for a dike project in the State unjust enrichment, and would work injustice
Pampanga. Respondent eventually won the bid, and against the respondent. The Court will not allow such to
finished constructing the dike. However, petitioners, occur. The CA was correct in declaring the contract void,
government officials of the DPWH, refused to pay but ordering payment based on quantum meruit. The
petitioner the contract price. Petitioners refuse because contract is illegal due to violations of requirements of
the contract is void for violation of P.D. P.D.
1445, for absence of an appropriation. Respondent 1445. However, it is not illegal per se. As such, it
brought suit in the RTC, which petitioners sought to is only proper that respondent be compensated as the
dismiss, raising the non-suability of the state, as well as completed project has already benefited the State and
non-exhaustion of administrative remedies. The lower the public. Such a ruling is supported by a long line of
court ruled for the validity of the contract and ordered Jurisprudence.
payment for the project. Upon appeal, the Court of
Appeals reversed the ruling of the lower court and
declared the contract invalid. However, the CA ordered
the Commission on Audit to determine the value of the
services rendered by respondent, and compensate him
based on quantum meruit.

ISSUES:
Whether or not the case should have been
dismissed for failure to exhaust administrative remedies.
Whether or not the case should have been dismissed as
it is a suit against the State, and the State may not be
sued. Whether or not it was proper for the CA to order
payment for respondent.

HELD:

The petition is without merit.

Remedial Law: The rule for exhaustion of all

administrative remedies admits of several exceptions.
Some of these obtain in the case at hand. The further
delay of respondent compensation will work injustice
against him, as the government and public has derived
benefit from the dike constructed for almost two
decades already. Remanding the case to an
administrative agency would further prejudice
respondent. In addition, the issue at hand is the validity
of the contract, which is purely a question of law. As
such, only the courts may address the issue directly.
9. SEC v. Interport - 567 SCRA 3542008 some previous point in time, inaccessible to Racing Club, Inc. (PRCI). PRCI owns 25.724
most. hectares of real estate property in Makati. Under
DOCTRINES:  Beneficial Owner; Parties; Locus Standi; the Agreement, GHB, a member of the
 Beneficial owner has been defined, first, to
indicate the interest of a beneficiary in trust Westmont Group of Companies in Malaysia, shall
 Revised Securities Act; Administrative Law; extend or arrange a loan required to pay for the
property (also called “equitable ownership”), and
Statutes; The mere absence of implementing proposed acquisition by IRC of PRCI. IRC alleged
second, to refer to the power of a corporate
rules cannot effectively invalidate provisions of that on 8 August 1994, a press release
shareholder to buy or sell the shares, though the
law, where a reasonable construction that will announcing the approval of the agreement was
shareholder is not registered in the corporation’s
support the law may be given. sent through facsimile transmission to the
book as the owner; Usually, beneficial ownership
 Insider Trading; Section 30 of the Revised Philippine Stock Exchange and the SEC, but that
is distinguished from naked ownership, which is
Securities Act explains in simple terms that the the enjoyment of all the benefits and privileges of the facsimile machine of the SEC could not
insider’s misuse of nonpublic and undisclosed ownership, as against possession of the bare title receive it. Upon the advice of the SEC, the IRC
information is the gravamen of illegal conduct— to property; The validity of a statute may be sent the press release on the morning of 9
the intent of the law is the protection of investors contested only by one who will sustain a direct August 1994. The SEC averred that it received
against fraud, committed when an insider, using injury as a result of its enforcement. reports that IRC failed to make timely public
secret information, takes advantage of an  Sections 30 and 36 of the Revised Securities Act disclosures of its negotiations with GHB and that
uninformed investor. some of its directors, respondents herein, heavily
were enacted to promote full disclosure in the
 Material Fact,” “Reasonable Person,” “Nature and traded IRC shares utilizing this material insider
securities market and prevent unscrupulous
Reliability,” and “Generally Available,” Explained; individuals, who by their positions obtain non- information. On 16 August 1994, the SEC
Under the law, what is required to be disclosed is public information, from taking advantage of an Chairman issued a directive requiring IRC to
a fact of “special significance” which may be (a) a uninformed public. submit to the SEC a copy of its aforesaid
material fact which would be likely, on being Memorandum of Agreement with GHB. The SEC
made generally available, to affect the market Chairman further directed all principal officers of
price of a security to a significant extent, or (b) IRC to appear at a hearing before the Brokers
FACTS:
one which a reasonable person would consider and Exchanges Department (BED) of the SEC to
especially important in determining his course of explain IRC’s failure to immediately disclose the
action with regard to the shares of stock; In On 6 August 1994, the Board of Directors of IRC
approved a Memorandum of Agreement with information as required by the Rules on
determining whether or not the terms “material Disclosure of Material Facts. In compliance with
fact,” “reasonable person,” “nature and Ganda Holdings Berhad (GHB). Under the
Memorandum of Agreement, IRC acquired 100% the SEC Chairman’s directive, the IRC sent a
reliability,” and “generally available,” are vague, letter dated 16 August 1994 to the SEC,
they must be evaluated in the context of Section or the entire capital stock of Ganda Energy
Holdings, Inc. (GEHI), which would own and attaching thereto copies of the Memorandum of
30 of the Revised Securities Act. A fact is Agreement. On 19 September 1994, the SEC
material if it induces or tends to induce or operate a 102 megawatt (MW) gas turbine
power-generating barge. The agreement also Chairman issued an Order finding that IRC
otherwise affect the sale or purchase of its violated the Rules on Disclosure of Material Facts,
securities. stipulates that GEHI would assume a five-year
power purchase contract with National Power in connection with the Old Securities Act of 1936,
 Whether information found in a newspaper, a when it failed to make timely disclosure of its
specialized magazine, or any cyberspace media Corporation. At that time, GEHI’s power-
generating barge was 97% complete and would negotiations with GHB. In addition, the SEC
be sufficient for the term “generally available” is pronounced that some of the officers and
a matter which may be adjudged given the go on-line by mid-September of 1994. In
exchange, IRC will issue to GHB 55% of the directors of IRC entered into transactions
particular circumstances of the case—the involving IRC shares in violation of Section 30, in
standards cannot remain at a standstill, as a expanded capital stock of IRC amounting to
40.88 billion shares which had a total par value of relation to Section 36, of the Revised Securities
medium, which is widely used today was, at Act. Among others, respondents, (thru an
P488.44 million. On the side, IRC would acquire
67% of the entire capital stock of Philippine amended omnibus motion) alleged that the SEC
had no authority to investigate the subject investigate violations of the Revised Securities uninformed investor. In some cases, however,
matter, since under Section 8 of Presidential Act, re-enacted in the Securities Regulations there may be valid corporate reasons for
Decree No. 902-A, as amended by Presidential Code, despite the abolition of the PED. (Yes) nondisclosure of material information. Where
Decree No. 1758, jurisdiction was conferred upon such reasons exist, an issuer’s decision not to
the Prosecution and Enforcement Department HELD: make any public disclosures is not ordinarily
(PED) of the SEC. The SEC denied considered as a violation of insider trading. At the
reconsideration in its Omnibus Order dated 30 The petition is impressed with merit. same time, the undisclosed information should
March 1995. After filing with the CA onn 5 May not be improperly used for non-corporate
1995, the Court of Appeals granted their motion purposes, particularly to disadvantage other
1. Sections 8, 30, and 36 of the Revised
and issued a writ of preliminary injunction, which persons with whom an insider might transact,
Securities Act (RSA) do not require the
effectively enjoined the SEC from filing any and therefore the insider must abstain from
enactment of implementing rules to make them
criminal, civil or administrative case against the entering into transactions involving such
binding and effective. The mere absence of
respondents herein. The CA determined that securities. Sec 36 – Directors, officers and
implementing rules cannot effectively invalidate
there were no implementing rules and regulations principal stockholders. This is a straightforward
provisions of law, where a reasonable
regarding disclosure, insider trading, or any of provision that imposes upon: (1) A beneficial
construction that will support the law may be
the provisions of the Revised Securities Acts owner of more than 10 percent of any class of
given. Absence of any constitutional or statutory
which the respondents allegedly violated. The any equity security; or (2) A director or any
infirmity, which may concern Secs 30 and 36 of
Court of Appeals likewise noted that it found no officer of the issuer of such security, the
RSA, the provisions are legal and binding. Every
statutory authority for the SEC to initiate and file obligation to submit a statement indicating his or
law has in its favour the presumption of validity.
any suit for civil liability under Sections 8, 30 and her ownership of the issuer’s securities and such
Unless and until a specific provision of the law is
36 of the Revised Securities Act. Thus, it ruled changes in his or her ownership. Sections 30 and
declared invalid and unconstitutional, the same is
that no civil, criminal or administrative 36 of the RSA were enacted to promote full
valid and binding for all intents and purposes.
proceedings may possibly be held against the disclosure in the securities market and prevent
The Court does not discern any vagueness or
respondents without violating their rights to due unscrupulous individuals, who by their positions
ambiguity in Sec 30 and 36 of RSA.
process and equal protection. It further resolved obtain non-public information, from taking
that absent any implementing rules, the SEC advantage of an uninformed public. Sec 30
cannot be allowed to quash the assailed Omnibus Sec 30 – Insider’s duty to disclose when trading. prevented the unfair use of non-public
Orders for the sole purpose of re-filing the same Insiders are obligated to disclose material information in securities transactions, while Sec
case against the respondents. information to the other party or abstain from 36 allowed the Sec to monitor the transactions
trading the shares of his corporation. This duty to entered into by corporate officers and directors
disclose or abstain is based on two factors: as regards the securities of their companies. The
ISSUES:
lack of implementing rules cannot suspend the
a) The existence of a relationship giving access, effectivity of these provisions.
1. Whether sections 8, 30, and 36 of the Revised
directly or indirectly, to information intended to
Securities Act require the enactment of
be available only for a corporate purpose and not 3. The Securities Regulation Code (SRC) did not
implementing rules to make them binding and
for the personal benefit of anyone repeal Sections 8, 30, and 36 of the Revised
effective. (No)
Securities Act since said provisions were re-
b) the inherent unfairness involved when a party enacted in the new law. When the repealing law
2. Whether a criminal case may still be filed
takes advantage of such information knowing it is punishes the act previously penalized under the
against the respondents despite the repeal of
unavailable to those with whom he is dealing. old law, the act committed before the re-
Sections 8, 30, and 36 of the Revised Securities
enactment continues to be an offense and
Act. (Yes)
The intent of the law is the protection of investors pending cases are not affected. Sec 8 of RSA,
against fraud, committed when an insider, using which previously provided for the registration of
3. Whether SEC retains the jurisdiction to
secret information, takes advantage of an securities and the information that needs to be
included in the registration statements, was market price of a security to a significant extent, facts and circumstances without resorting to the
expanded under Sec 12 of the Securities or calibrations of our technical rules of evidence of
Regulations Code. Further details of the which his knowledge is nil. Rather, he relies on
information required to be disclosed by the (b) one which a reasonable person would the calculus of common sense of which all
registrant are explained. Sec 30 of RSA has been consider especially important in determining his reasonable men have in abundance.
re-enacted as Sec 27 of SRC, still penalizing an course of action with regard to the shares of
insider’s misuse of material and nonpublic stock. (a) Material Fact—The concept of a (b.2) Nature and Reliability—The factors affecting
information about the issuer, for the purpose of “material fact” is not a new one. As early as the second definition of a “fact of special
protecting public investors. Sec 23 of SRC was 1973, the Rules Requiring Disclosure of Material significance,” which is of such importance that it
practically lifted from Sec 36 of RSA. The Facts by Corporations Whose Securities Are is expected to affect the judgment of a
legislature had not intended to deprive the courts Listed In Any Stock Exchange or reasonable man, were substantially lifted from a
of their authority to punish a person charged with Registered/Licensed Under the Securities Act, test of materiality pronounced in the case In the
violation of the old law that was repealed 4. The issued by the SEC on 29 January 1973, explained Matter of Investors Management Co., Inc.:
SEC retained the jurisdiction to investigate that “[a] fact is material if it induces or tends to “Among the factors to be considered in
violations of the Revised Securities Act, re- induce or otherwise affect the sale or purchase of determining whether information is material
enacted in the Securities Regulations Code, its securities.” Thus, Section 30 of the Revised under this test are the degree of its specificity,
despite the abolition of the PED. Sec 53 of SRC Securities Act provides that if a fact affects the the extent to which it differs from information
clearly provides that criminal complaints for sale or purchase of securities, as well as its price, previously publicly disseminated, and its
violations of rules and regulations enforced or then the insider would be required to disclose reliability in light of its nature and source and the
administered by SEC shall be referred to the DOJ This is the first definition given to a “fact of circumstances under which it was received.”
for preliminary investigation, while the SEC special significance.” such information to the
nevertheless retains limited investigatory powers. other party to the transaction involving the (c) Materiality Concept—A discussion of the
SEC may still impose the appropriate securities. “materiality concept” would be relevant to both a
administrative sanctions under Sec 54. In all, the material fact which would affect the market price
SC rules that no implementing rules were needed (b.1) Reasonable Person—The second definition of a security to a significant extent and/or a fact
to render effective Sections 8, 30, and 36 of the given to a fact of special significance involves the which a reasonable person would consider in
Revised Securities Act; nor was the PED Rules of judgment of a “reasonable person.” Contrary to determining his or her cause of action with
Practice and Procedure invalid, prior to the the allegations of the respondents, a “reasonable regard to the shares of stock. Significantly, what
enactment of the Securities Regulations Code, for person” is not a problematic legal concept that is referred to in our laws as a fact of special
failure to provide parties with the right to cross- needs to be clarified for the purpose of giving significance is referred to in the U.S. as the
examine the witnesses presented against them. effect to a statute; rather, it is the standard on “materiality concept” and the latter is similarly
Thus, the respondents maybe investigated by the which most of our legal doctrines stand. The not provided with a precise definition.
appropriate authority under the proper rules of doctrine on negligence uses the discretion of the
procedure of the Securities Regulations Code for “reasonable man” as the standard. A
violations of Secs 8, 30, and 36 of the Revised purchaser in good faith must also take into
Securities Act. account facts which put a “reasonable man” on
his guard. In addition, it is the belief of the
Definitions discussed in the case: Under the reasonable and prudent man that an offense was
law, what is required to be disclosed is a fact of committed that sets the criteria for probable
“special significance” which may be cause for a warrant of arrest. The Court, in such
cases, differentiated the reasonable and prudent
(a) a material fact which would be likely, on man from “a person with training in the law such
being made generally available, to affect the as a prosecutor or a judge,” and identified him as
“the average man on the street,” who weighs
10. People v. Maceren to punish electro fishing, a penal provision to should be for the sole purpose of carrying into
that effect could have been easily embodied in effect its general provisions. By such
Facts: the old Fisheries Law. regulations, of course, the law itself cannot be
The lawmaking body cannot delegate to an extended.
The respondents were charged with violating executive
Fisheries official the power to declare what acts should The rule-making power must be confined to
Administrative Order No. 84-1 which penalizes constitute an offense. details for
electro fishing in fresh water fisheries. This was It can authorize the issuance of regulations regulating the mode or proceeding to carry into
promulgated by the Secretary of Agriculture and the imposition of the penalty provided for effect the law as it has been enacted. The
and Natural Resources and the Commissioner in the law itself. power cannot be extended to amending or
of Fisheries under the old Fisheries Law and Where the legislature has delegated to expanding the statutory requirements or to
the law creating the Fisheries Commission. The executive or embrace matters not covered by the statute.
municipal court quashed the complaint and administrative officers and boards authority to Rules that subvert the statute cannot be
held that the law does not clearly prohibit promulgate rules to carry out an express sanctioned.
electro fishing, hence the executive and judicial legislative purpose, the rules of administrative
departments cannot consider the same. officers and boards, which have the effect of
On appeal, the CFI affirmed the dismissal. extending, or which conflict with the authority
Hence, this appeal to the SC. granting statute, do not represent a valid
precise of the rule-making power but constitute
Issue: an attempt by an administrative body to
legislate
 Whether or not the administrative order Administrative agent are clothed with rule-
penalizing electro fishing is valid. making powers because the lawmaking body
finds it impracticable, if not impossible, to
Held: anticipate and provide for the multifarious and
complex situations that may be encountered in
 NO. The Secretary of Agriculture and enforcing the law. All that is required is that
Natural Resources the regulation should be germane to the
defects and purposes of the law and that it
and the Commissioner of Fisheries exceeded should conform to the standards that the law
their authority in issuing the administrative prescribes.
order. The old Fisheries Law does not expressly
prohibit electro fishing. As electro fishing is not Administrative regulations adopted under
banned under that law, the Secretary of legislative
Agriculture and Natural Resources and the authority by a particular department must be
Commissioner of Fisheries are powerless to in harmony with the provisions of the law, and
penalize it. Had the lawmaking body intended