Powers of Administrative Agencies

i. Sources and Scope of Powers and Functions of Administrative Agencies

Case:
Makati Stock Exchange Inc. v. Securities and Exchange Commission, G.R. No. L-
23004, June 30, 1965
FACTS:
 This case is a review of the resolution of the SEC which denied petitioner, Makati
Stock Exchange Inc., permission to operate a stock exchange unless it agreed
not to list for trading on its board, securities already listed in the Manila Stock
Exchange (double listing).
 Petitioner contends that the Commission has no power to impose it and to do so
would be illegal, discriminatory, and unjust.
 Under the law, no stock exchange may do business in the Philippines unless it is
previously registered with the Commission. Thus, it is assumed that the
Commission may permit registration if the section is complied with; otherwise, it
may refuse.
 MakEC is challenging this particular requirement of the Commission (rule against
double listing)

[Rule against double listing - Such rule provides: “… nor shall a security already listed in
any securities exchange be listed anew in any other securities exchange… .”]

[Objection of the MakEC on the above rule] The MakEC has been operating alone for
25years, and presumably, all available securities for trading in the market are already
listed there. In effect, the Commission permits MakEC to deal only with other securities,
which tantamount to a monopoly. The Commission’s order/resolution makes it
impossible for the MakEC to operate, thus, “permission” amounts to “prohibition.”

ISSUE: WON the Commission has the authority to promulgate and implement the rule
in question

RULING: The Supreme Court upheld the SEC’s decision to deny the license to the
Makati Stock Exchange, affirming the SEC’s authority to regulate and control stock
exchanges in the Philippines. The SEC's decision was not arbitrary, and it had acted
within its legal mandate under the Securities and Exchange Act.

 It is fundamental that an administrative officer has only such powers as are

expressly granted to him by the statute, and those necessarily implied in the
exercise thereof.
  The test is not whether the Act forbids the Commission from imposing a
prohibition, but whether it empowers the Commission to prohibit. No specific
portion of the statute has been cited to uphold this power.
 The general power to “regulate” which the Commission has does not imply
authority to prohibit.
 ManEC contends that the power may be inferred from the express power of the
Commission to suspend trading in a security, under said sec. 28: And if in its
opinion, the public interest so requires, summarily to suspend trading in any
registered security on any securities exchange … . (Sec. 28[3], Securities Act.)

The Commission has not acted in pursuance of such authority, for the simple
reason that suspension under it may only be for ten days. Besides, the
suspension of trading in the security should not be on one exchange only, but on
all exchanges; bearing in mind that suspension should be ordered “for the
protection of investors” (first par., sec. 28) in all exchanges, naturally, and if “the
public interest so requires” [sec. 28(3)].

 The Supreme Court affirmed the decision of the SEC and ruled that the SEC has
the discretionary authority to deny the license to operate a stock exchange if it
finds that the requirements set forth by the law are not met or if the application
does not conform to the law's intent.
 SEC’s Authority: The Court held that the Securities and Exchange Commission
(SEC) has the power to grant or deny the license for stock exchanges in
accordance with the law. The SEC is tasked with supervising and regulating the
securities market to ensure that it is organized, transparent, and complies with
the law’s requirements. The Court emphasized that the SEC’s discretion in
granting or denying such applications was part of its regulatory powers.
 Discretion of the SEC: The Court clarified that the SEC’s decision to deny the
license was not arbitrary. The SEC had the right to refuse the license if, in its
judgment, the applicant did not meet the standards and qualifications necessary
to operate a stock exchange, and such discretion should not be interfered with by
the courts.
 Compliance with Securities Law: The Court noted that the Securities and
Exchange Act gave the SEC the authority to impose qualifications and conditions
upon stock exchanges, and it is within the SEC’s discretion to determine whether
an exchange meets those requirements. The SEC did not have to approve
MSE’s application merely because MSE claimed to have complied with the law if
the SEC, in its judgment, found otherwise.

Quasi-Legislative Power
 I. Kinds of Administrative rules and regulations

1. Legislative Rules (Supplementary or Detailed Legislature)

Cases:

Ople vs. Torres (G.R. No. 127685 July 23, 1998)

Article 6 Section 1 Philippine Constitution (1987) (The Legislative Department)

FACTS:
 Petitioner Ople prays that we invalidate Administrative Order No. 308 entitled
"Adoption of a National Computerized Identification Reference System" on two
important constitutional grounds.
 (1) It is a usurpation of the power of Congress to legislate, and (2) It
intrudes on our citizenry's protected zone of privacy and (3) appropriation
of public funds by the president is a usurpation of the exclusive rights of
the congress to appropriate public funds for expenditure
 A.O. No. 308 V was issued by President Fidel. Ramos and published in 4
newspapers of general circulation on January 22, 1997 and January 23,
1997.
 On January 24, 1997, petitioner filed the instant petition against respondents,
then Executive Secretary Ruben Torres and the heads of the government
agencies, who as members of the Inter-Agency Coordinating Committee, are
charged with the implementation of A.O. No. 308.
 Petitioner contends that the establishment of a national computerized
identification reference system requires a legislative act. The issuance of
A.O. No. 308 by the president of the republic of the Philippines is, therefore, an
unconstitutional usurpation of the legislative powers of the congress of the
Republic of the Philippines.

*usurpation - wrongfully seizing and holding (an office or powers) by force (especially
the seizure of a throne or supreme authority)

ISSUE:
(1) WON the issuance of the A.O. by the president is an unconstitutional usurpation of
the legislative powers of the congress of the Republic of the Philippines

(2) WON it intrudes the citizen’s right to privacy

*usurpation - wrongfully seizing and holding (an office or powers) by force (especially
the seizure of a throne or supreme authority)

RULING:
(1) Yes.
 The Court held that the Constitution has vested this power in the Congress
of the Philippines. The grant of legislative power to Congress is broad,
general and comprehensive.
  The legislative body possesses plenary power for all purposes of civil
government. Any power, deemed to be legislative by usage and tradition, is
necessarily possessed by Congress, unless the Constitution has lodged it
elsewhere. In fine, except as limited by the Constitution, either expressly or
impliedly, legislative power embraces all subjects and extends to matters of
general concern or common interest.
 While Congress is vested with the power to enact laws, the President
executes the laws. The executive power is vested in the Presidents. It is
generally defined as the power to enforce and administer the laws. It is the
power of carrying the laws into practical operation and enforcing their due
observance. The President has the duty of supervising the enforcement of laws
for the maintenance of general peace and public order. Thus, he is granted
administrative power over bureaus and offices under his control to enable him to
discharge his duties effectively.
 In this case, A.O. No. 308 involves a subject that is not appropriate to be
covered by an administrative order. It establishes for the first time a National
Computerized Identification Reference System. Such a System requires a
delicate adjustment of various contending state policies — the primacy of
national security, the extent of privacy interest against dossier-gathering by
government, the choice of policies, etc.
 Regulations are not supposed to be a substitute for the general policy-
making that Congress enacts in the form of a public law. Although
administrative regulations are entitled to respect, the authority to prescribe rules
and regulations is not an independent source of power to make laws.
 Hence, the issuance of A.O. No. 308 by the president of the republic of the
Philippines is an unconstitutional usurpation of the legislative powers of the
congress of the Republic of the Philippines.

Petitioner's sedulous concern for the Executive not to trespass on the lawmaking
domain of Congress is understandable. The blurring of the demarcation line between
the power of the Legislature to make laws and the power of the Executive to execute
laws will disturb their delicate balance of power and cannot be allowed. Hence, the
exercise by one branch of government of power belonging to another will be given a
stricter scrutiny by this Court.

The line that delineates Legislative and Executive power is not indistinct.
Legislative power is "the authority, under the Constitution, to make laws, and to alter
and repeal them." [8] The Constitution, as the will of the people in their original,
sovereign and unlimited capacity, has vested this power in the Congress of the
Philippines. [9] The grant of legislative power to Congress is broad, general and
comprehensive. [10] The legislative body possesses plenary power for all purposes of
civil government. [11] Any power, deemed to be legislative by usage and tradition, is
necessarily possessed by Congress, unless the Constitution has lodged it elsewhere.
[12] In fine, except as limited by the Constitution, either expressly or impliedly,
legislative power embraces all subjects and extends to matters of general concern or
common interest. [13]
 While Congress is vested with the power to enact laws, the President executes
the laws. The executive power is vested in the President. It is generally defined as the
power to enforce and administer the laws. It is the power of carrying the laws into
practical operation and enforcing their due observance.

(2) Yes

 A.O. No. 308 cannot pass constitutional muster as an administrative legislation

because facially it violates the right to privacy. The essence of privacy is the
“right to be let alone.” The right to privacy as such is accorded recognition
independently of its identification with liberty; in itself, it is fully deserving of
constitutional protection.

 The potential for misuse of the data to be gathered under A.O. No. 308 cannot be
underplayed. The right to privacy is one of the most threatened rights of man
living in a mass society. The threats emanate from various sources —
governments, journalists, employers, social scientists, etc.

 In the case at bar, the threat comes from the executive branch of government
which by issuing A.O. No. 308 pressures the people to surrender their privacy by
giving information about themselves on the pretext that it will facilitate delivery of
basic services.

Commission on Internal Revenue v. CA, G.R. No. 108358, January 20, 1995
FACTS:
 Back in August 1986, the President still wielded legislative powers
 EO 41: one-time tax amnesty on unpaid income taxes, later amended to include
estate and donor’s taxes and taxes on business, for taxable years 1981-1985
 Respondent, ROH Auto Products Philippines, Inc. filed in Oct. 1986 and Nov.
1986 its Tax Amnesty Return and Supplemental Tax Amnesty Return
 Prior to this availment, petitioner, CIR, assess the latter deficiency income and
business taxes for its fiscal years ending Sept. 1981
 Respondent contended that since it had been able to avail itself of the tax
amnesty, the deficiency tax notice should be cancelled and withdrawn
 This was denied by the Commissioner implementing EO No. 41 stating that the
amnesty coverage includes only assessments issued by the BIR after the
promulgation of the EO on August 1986 and not to assessments made
 Respondent appealed to the Commissioner’s denial to the CTA, which ruled in
favor of the respondent saying the Commissioner failed to present any case or
 law which provides that an assessment can withstand or negate the force and
effects of a tax amnesty
 On appeal by the Commissioner to the CA, the decision of the tax court was
affirmed finding that the Court finds no ground in denying the respondent claim to
the benefits of the amnesty law

ISSUE: WON the position taken by the Commissioner coincides with the meaning and
intent of Executive Order No. 41.

RULING:
The Court agreed with both the Court of Appeals and Court of Tax Appeals that EO No.
41 is quite explicit and requires hardly anything beyond a simple application of its
provisions.

The authority of the Minister of Finance (now the Secretary of Finance), in conjunction
with the Commissioner of Internal Revenue, to promulgate all needful rules and
regulations for the effective enforcement of internal revenue laws cannot be
controverted. Neither can it be disputed that such rules and regulations, as well as
administrative opinions and rulings, ordinarily should deserve weight and respect by the
courts. Much more fundamental than either of the above, however, is that all such
issuances must not override, but must remain consistent and in harmony with, the law
they seek to apply and implement. Administrative rules and regulations are intended to
carry out, neither to supplant nor to modify, the law.

2. Interpretative Rules
Cases:
Victorias Milling Co. v. Social Security Commission, 114 Phil. 555 (1962)
FACTS:
 Victorias Milling Company (VMC) is a corporation engaged in the sugar
industry in the Philippines.
 VMC, as an employer, was required under the Social Security Act (Republic Act
No. 1161) to register with the Social Security System (SSS) and contribute to
the social security fund for its employees.
 The Social Security Commission (SSC) conducted an audit of VMC’s records
and found that it had not properly registered all of its employees under the Social
Security System and had failed to make the required contributions for certain
workers.
 The SSC issued a revised assessment for the unpaid contributions, penalties,
and interests.
 VMC contested the assessment and sought relief from the Social Security
Commission, arguing that it should not be held liable for the contributions of
employees who were not included in its payroll or were not employees.
  VMC contended that the SSC’s revised assessment was unfair and that certain
employees should not have been included in the contribution requirements.
 The SSC ruled that VMC was indeed liable for the contributions, penalties, and
interest, and VMC brought the case to the Supreme Court for judicial review.

ISSUE: WON the Circular in question is a rule or regulation empowering the Social
Security Commission "to adopt, amend and repeal subject to the approval of the
President such rules and regulations as may be necessary to carry out the provisions
and purposes of this Act."

RULING: The Supreme Court affirmed the decision of the Social Security Commission,
holding that Victorias Milling Company was liable for the unpaid social security
contributions, penalties, and interest. The Court emphasized that the SSC had the legal
authority to enforce the Social Security Act, and employers are required to properly
register all employees and remit the necessary contributions.

Circular No. 22 purports merely to advise employers-members of the System of what, in

the light of the amendment of the law, they should include in determining the monthly
compensation of their employees upon which the social security contributions should be
based, and that such circular did not require presidential approval and publication in the
Official Gazette for its effectivity.
 There is a distinction between an administrative rule or regulation and an
administrative interpretation of a law whose enforcement is entrusted to an
administrative body.
 Administrative agency promulgates rules and regulations – “makes” a new law
with the force and effect of a valid law
 Administrative agency renders an opinion or gives a statement of policy –
interprets a pre-existing law
 Rules and regulations when promulgated in pursuance of the procedure or
authority conferred upon the administrative agency by law, partake of the nature
of a statute, and compliance therewith may be enforced by a penal sanction
provided in the law.
o Statutes are couched in general terms, after expressing the purposes,
remedies, and sanctions intended by the legislature
o The details and the manner of carrying out the law are often times left to
the administrative agency entrusted with its enforcement
 Rules and regulations are the product of a delegated power to create new or
additional legal provisions that have the effect of law
 A rule is binding on the courts so long as the procedure fixed for its promulgation
is followed and the scope its within the authority granted by the legislature
 Administrative interpretation of the law is merely advisory
  In this case, prior to the amendment, bonuses, allowances, and overtime pay
given in addition to the regular or base pay were expressly excluded or exempted
from the definition of the term "compensation", such exemption or exclusion was
deleted by the amendatory law.
 It became necessary for the Social Security Commission to interpret the effect of
such deletion or elimination

The Supreme Court ruled in favor of the Social Security Commission (SSC), upholding
the SSC’s decision to assess and collect the unpaid contributions from Victorias Milling
Company.

- Authority of SSC: The Court affirmed that the Social Security Commission has
the authority to assess and collect contributions from employers under the Social
Security Act (Republic Act No. 1161). The SSC is tasked with ensuring
compliance with the law, and its actions in auditing and issuing assessments
were within its legal powers.
- Liability for Contributions: The Court ruled that Victorias Milling Company was
liable for the social security contributions for employees, including those who
were not included in its original payroll. The fact that these employees worked for
VMC and received wages meant that the company had the obligation to report
them to the SSS and make the necessary contributions. VMC’s claim that certain
employees should not be included in the payroll was rejected.
- Penalties and Interest: The Supreme Court upheld the imposition of penalties
and interest on the unpaid contributions. The Court ruled that the penalties and
interest were authorized under the Social Security Act to encourage timely
payment of contributions and to ensure the proper funding of the social security
system.

Philippine Blooming Mills v. Social Security System, 124 Phil. 499 (1966)
FACTS:
 Petitioner is a domestic corporation employing Japanese technicians under a
pre-arranged contract of employment wherein the period is a minimum of 6
months and a maximum of 24 months
 In connection with the employment of 6 Japanese technicians, it sent an inquiry
to SSS whether these employees are subject to compulsory coverage under the
System
 Assistant General Manager of the corporation filed a claim with the SSS for the
refund of the premiums paid to the System on the ground of termination of the
members’ employment.
  This was denied as SSS alleged that Rule IX of the Rules and Regulations of the
System, as amended, requires membership in the System for at least 2 years
before a separated or resigned employee may be allowed a return of his
personal contributions and under the same rule, the employer is not entitled to a
refund of the premium contributions it had paid
 It is this resolution of the Commission that is the subject of the present appeal,
appellants contending that the amendment of the Rules and Regulations of the
SSS, insofar as it eliminates the provision on the return of premium-contributions,
originally embodied in Section 3 (d) of Rule I, constituted an impairment of
obligations of contract. It is claimed, in effect, that when appellants-employees
became members in September, 1957 and paid the corresponding premiums to
the System, [1] it is subject to the condition that upon their departure from the
Philippines, these employees, as well as their employer, are entitled to a rebate
of a proportionate amount of their respective contributions.

ISSUE: WON appellants are bound by the amended Rules requiring membership for
two years before a refund of the premium-contributions may be allowed.

RULING:
 The Rules and Regulations of the SSS having been promulgated in
implementation of a law, have the force and effect of a statute
 These rules and regulations were promulgated to provide guidelines to be
observed in the enforcement of the law.
 In the present case, the original Rules and Regulations of the SSS specifically
provide that any amendment thereto subsequently adopted by the Commission,
shall take effect on the date of its approval by the President.
 Consequently, the delayed publication of the amended rules in the Official
Gazette did not affect the date of their effectivity, which is January 14, 1958,
when they were approved by the President.
 It follows that when the Japanese technicians were separated from employment
in October, 1958, the rule governing refund of premiums is Rule IX of the
amended Rules and Regulations, which requires membership for 2 years before
such refund of premiums may be allowed.

Commission on Internal Revenue v. Court of Appeals, G.R. No. 119761, August 29,
1996
FACTS:
 Fortune Tobacco Corporation (Fortune Tobacco) is engaged in the manfacture of
different brands of cigarettes
 Commissioner of CIR classified “Champion”, “Hope”, and “More” cigarettes as
foreign brands since they were listed as belonging to foreign companies
  However, Fortune Tobacco changed the names of “Hope” to “Luxury” and “More”
to “Premium More” which caused the removal of the brands from the foreign
brand category. Ad Valorem taxes were imposed on the brands
 RA 7654 was enacted by the legislature and signed into law. This amended
Section 142 (c )(1) of the NIRC
 Revenue Memorandum Circular was issued by the BIR. In the said
Memorandum, the cigarettes brands HOPE, MORE and CHAMPION were
considered as locally manufactured cigarettes bearing a foreign brand thus is
now subject to the 55% ad valorem tax on cigarettes.
 CIR assessed Fortune Tobacoo for ad valorem tax deficiency amounting to P9M
 Fortune Tobacco filed a petition for review with the CTA
 CTA upheld the position of Fortune Tobacco ruling that the reclassification of the
3 cigarette brands were defective. Thus, the deficiency ad valorem tax
assessment is cancelled for lack of legal basis
 Petitioner opines that RMC 37-93 is merely an interpretative ruling of the BIR
which can thus become effective without any prior need for notice and hearing,
nor publication, and that its issuance is not discriminatory since it would apply
under similar circumstances to all locally manufactured cigarettes

ISSUE: WON Revenue Memorandum Circular No. 37-93 (“RMC 37-93”) issued by the
BIR is valid

RULING:

Let us distinguish between two kinds of administrative issuances — a legislative rule

and an interpretative rule. In Misamis Oriental Association of Coco Traders, Inc., vs.
Department of Finance Secretary, “legislative rule is in the nature of subordinate
legislation, designed to implement a primary legislation by providing the details thereof.
In the same way that laws must have the benefit of public hearing, it is generally
required that before a legislative rule is adopted there must be hearing. In this
connection, the Administrative Code of 1987 provides:

“Public Participation. — If not otherwise required by law, an agency shall, as far as

practicable, publish or circulate notices of proposed rules and afford interested parties
the opportunity to submit their views prior to the adoption of any rule. “(1) In the fixing of
rates, no rule or final order shall be valid unless the proposed rates shall have been
published in a newspaper of general circulation at least two (2) weeks before the first
hearing thereon. “(3) In case of opposition, the rules on contested cases shall be
observed. “In addition such rule must be published.
On the other hand, interpretative rules are designed to provide guidelines to the law
which the administrative agency is in charge of enforcing.”

It should be understandable that when an administrative rule is merely interpretative in

nature, its applicability needs nothing further than its bare issuance for it gives no real
consequence more than what the law itself has already prescribed. When, upon the
other hand, the administrative rule goes beyond merely providing for the means that can
facilitate or render least cumbersome the implementation of the law but substantially
adds to or increase the burden of those governed, it behooves the agency to accord at
least to those directly affected a chance to be heard, and thereafter to be duly informed,
before that new issuance is given the force and effect of law.

A reading of RMC 37-93 convinces us that the circular cannot be viewed simply as a
corrective measure (revoking in the process the previous holdings of past
Commissioners) or merely as construing Section 142(c)(1) of the NIRC, as amended,
but has, in fact and most importantly, been made in order to place “Hope Luxury,”
“Premium More” and “Champion” within the classification of locally manufactured
cigarettes bearing foreign brands and to thereby have them covered by RA 7654. Prior
to the issuance of the questioned circular, “Hope Luxury,” “Premium More,” and
“Champion” cigarettes were in the category of locally manufactured cigarettes not
bearing foreign brand subject to 45% ad valorem tax. Hence, without RMC 37-93, the
enactment of RA 7654, would have had no new tax rate consequence on private
respondent’s products. Evidently, in order to place “Hope Luxury,” “Premium More,” and
“Champion” cigarettes within the scope of the amendatory law and subject them to an
increased tax rate, the now disputed RMC 37-93 had to be issued. In so doing, the BIR
not simply interpreted the law; verily, it legislated under its quasi-legislative authority.
The due observance of the requirements of notice, of hearing, and of publication should
not have been then ignored.

GMA Network v. Commission on Elections, G.R. No. 205357, September 2, 2014

FACTS:
 Assailed in these petitions are certain regulations promulgated by the
Commission on Elections (COMELEC) relative to the conduct of the 2013
national and local elections dealing with political advertisements. Specifically, the
petitions question the constitutionality of the limitations placed on aggregate
airtime allowed to candidates and political parties, as well as the requirements
incident thereto, such as the need to report the same, and the sanctions imposed
for violations.
 The five (5) petitions before the Court put in issue the alleged unconstitutionality
of Section 9 (a) of COMELEC Resolution No. 9615 (Resolution) limiting the
broadcast and radio advertisements of candidates and political parties for
 national election positions to an aggregate total of one hundred twenty (120)
minutes and one hundred eighty (180) minutes, respectively. They contend that
such restrictive regulation on allowable broadcast time violates freedom of the
press, impairs the people’s right to suffrage as well as their right to information
relative to the exercise of their right to choose who to elect during the forth
coming elections.
 The heart of the controversy revolves upon the proper interpretation of the
limitation on the number of minutes that candidates may use for television and
radio advertisements, as provided in Section 6 of Republic Act No. 9006 (R.A.
No. 9006), otherwise known as the Fair Election Act.
 For this purpose, the COMELEC shall require any broadcast station or entity to
submit to the COMELEC a copy of its broadcast logs and certificates of
performance for the review and verification of the frequency, date, time and
duration of advertisements broadcast for any candidate or political party.
 During the previous elections of May 14, 2007 and May 10, 2010, COMELEC
issued Resolutions implementing and interpreting Section 6 of R.A. No. 9006,
regarding airtime limitations, to mean that a candidate is entitled to the
aforestated number of minutes “per station.” For the May 2013 elections,
however, respondent COMELEC promulgated Resolution No. 9615 dated
January 15, 2013, changing the interpretation of said candidates’ and political
parties’ a airtime limitation for political campaigns or advertisements from a “per
station” basis, to “total aggregate” basis.
 Petitioners ABS-CBN Corporation (ABS-CBN), ABC Development Corporation
(ABC), GMA Network, Incorporated ( GMA), Manila Broadcasting Company, Inc.
(MBC), Newsounds Broadcasting Network, Inc. (NBN), and Radio Mindanao
Network, Inc. (RMN) are owners/operators of radio and television networks in the
Philippines, while petitioner Kapisanan ng mga Brodkaster ng Pilipinas (KBP) is
the national organization of broadcasting companies in the Philippines
representing operators of radio and television stations and said stations
themselves. They sent their respective letters to the COMELEC questioning the
provisions of the aforementioned Resolution, thus, the COMELEC held public
hearings. Thereafter, on February 1, 2013, respondent issued Resolution No.
9631 amending provisions of Resolution No. 9615. Nevertheless, petitioners still
found the provisions objectionable and oppressive, hence, the present petitions.

ISSUE: Whether or not the Comelec resolution is valid.

RULING: NO
COMELEC Resolution No. 9615 introduced a radical departure from the previous
COMELEC resolutions relative to the airtime limitations on political advertisements. This
essentially consists in computing the airtime on an aggregate basis involving all the
media of broadcast communications compared to the past where it was done on a per
station basis. Thus, it becomes immediately obvious that there was effected a drastic
reduction of the allowable minutes within which candidates and political parties would
be able to campaign through the air. The question is accordingly whether this is within
the power of the COMELEC to do or not. The Court holds that it is not within the power
of the COMELEC to do so.

COMELEC, despite its role as the implementing arm of the Government in the
enforcement and administration of all laws and regulations relative to the conduct of an
election, has neither the authority nor the license to expand, extend, or add anything to
the law it seeks to implement thereby. The IRRs the COMELEC issued for that purpose
should always be in accord with the law to be implemented, and should not override,
supplant, or modify the law. It is basic that the IRRs should remain consistent with the
law they intend to carry out.

3. Contingent Rules
Cruz v. Youngberg, 56 Phil. 234 (1931)
FACTS:
 The respondent, Stanton Youngberg, the Director of the Bureau of Animal
Industry, requiring him to issue a permit for the landing of 10 large cattle imported
by the petitioner and for the slaughter
 The petitioner attacked the constitutionality of Act 3155 which prohibits the
importation of cattle from foreign countries into the PH Islands
 The respondent demurred to the petition on the ground that it did not state facts
sufficient to constitute a cause of action
o If Act 3315 were declared unconstitutional and void, the petitioner would
not be entitled to the relief demanded because Act No. 3052 would
automatically become effective and would prohibit the respondent from
giving the permit prayed for
o Act No, 3155 was constitutional and valid
 The Court sustained the demurrer and the complaint was dismissed. The
petitioner appealed.
 The appellee contends that even if Act No. 3155 be declared unconstitutional,
Act 3052 would automatically become effective
 The petitioner does not present any allegation in regard to Act No. 3052 to show
its nullity or unconstitutionality though it appears clearly that in the absence of Act
3155 the former act would make it impossible for the Director of the Bureau of
Animal Industry to grant the petitioner a permit for the importation without the
approval of the head of the corresponding department
 o An unconstitutional statute can have no effect to repeal former laws or
parts of laws by implication, since, being void, it is not inconsistent with
such former laws
ISSUE: WON the power conferred upon the Governor-General by Act No. 3155 to
suspend or modify the prohibition constitutes an unlawful delegation of legislative
power.

RULING:
 This Court has several times declared that it will not pass upon the
constitutionality of statutes unless it is necessary to do so but in this case it is not
necessary to pass upon the validity of the statute attacked by the petitioner
o Because even if it were declared unconstitutional, the petitioner would not
be entitled to relief inasmuch as Act No. 3052 is not in issue
 Aside from the provisions of Act No. 3052, the Court stated Act No. 3155 is valid
 The facts of the petition show that at the time Act No. 3155 was promulgated
there was a reasonable necessity so it cannot be said that the Legislature
exceeded its power in passing the Act
 It is not for this court to avoid or vacate the Act upon constitutional grounds nor
will it assume to determine whether the measures are wise or the best that might
have been adopted
 "The true distinction, therefore, is between the delegation of power to make the
law, which necessarily involves a discretion as to what it shall be, and conferring
an authority or discretion as to its execution, to be exercised under and in
pursuance of the law. The first cannot be done; to the latter no valid objection
can be made."
 Act No. 3155 is not an absolute prohibition of the importation of cattle and it does
not add any provision to section 3 of the Tariff Law.

Zabal v. Duterte, G.R. No. 238467, February 12, 2019

FACTS:
 Zabal and Jacosalem are residents of Boracay who were earning a living from
tourist activities. Bandiola claims to occasionally visit Boracay for business and
pleasure
 Three of them base their locus standi on direct injury and also from the
importance doctrine
 Respondents are being sued in their capacity as officials of the government
 President Duterte first made public his plan to shutdown Boracay claiming it has
become a cesspool and shut it down on April 2018 for a maximum of 6 months
  From this pronouncement, petitioners contend that around 630 police and military
were deployed to Boracay for crowd dispersal management and also allege that
the DILG had already released guidelines for the closure
 Petitioners claim that ever since the shutdown, fewer tourists had been engaging
their services which resulted their earnings not enough to feed their families
 Petitioners filed a petition stating that the day following the filing of their original
petition, President Duterte issued Proclamation No. 475 formally declaring a
state of calamity in Boracay
 On October 2018, Boracay was reopened to tourism
 Petitioner’s argument: Proclamation No. 475 is an invalid exercise of legislative
powers - President exercised a power legislative in nature, thus unlawfully
excluding the legislative department from the assertion of such power
o The proclamation imposed a restriction on the right to travel – impairs the
2 conditions and not a threat or danger to public
o The proclamation imposed a restriction on due process – property rights
and right to work and earn a living
o Closure could not have been anchored on police power – must be
exercised by legislative, not executive
o Impinges on the local autonomy of affected LGUs
 Respondents’ argument: issuance is a valid exercise of delegated legislative
power being anchored on the Philippine Disaster Risk Reduction and
Management Act and that the issuance was pursuant to the President’s
executive power under Section 1, Art. VII of the Constitution
o President merely exercised his power of control over the executive branch

ISSUE: Whether or not Proclamation No. 475 in unconstitutional

RULING: NO
The closure of Boracay, albeit temporarily, gave the island its much needed breather,
and likewise afforded the government the necessary leeway in its rehabilitation
program. Note that apart from review, evaluation and amendment of relevant policies,
the bulk of the rehabilitation activities involved inspection, testing, demolition, relocation,
and construction. These works could not have easily been done with tourists present.
The rehabilitation works in the first place were not simple, superficial or mere cosmetic
but rather quite complicated, major, and permanent in character as they were intended
to serve as long-term solutions to the problem. In any case, the closure, to emphasize,
was only for a definite period of six months, i.e., from April 26, 2018 to October 25,
2018. To the mind of the Court, this period constitutes a reasonable time frame, if not to
complete, but to at least put in place the necessary rehabilitation works to be done in
the island. Indeed, the temporary closure of Boracay, although unprecedented and
radical as it may seem, was reasonably necessary and not unduly oppressive under the
circumstances. It was the most practical and realistic means of ensuring that
rehabilitation works in the island are started and carried out in the most efficacious and
expeditious way. Absent a clear showing of grave abuse of discretion,
unreasonableness, arbitrariness or oppressiveness, the Court will not disturb the
executive determination that the closure of Boracay was necessitated by the foregoing
circumstances. As earlier noted, petitioners totally failed to counter the factual bases of,
and justification for the challenged executive action.

II. Validity of Rules and Regulations; Requisites

Cases:
Taxicab Operators of Metro Manila, Inc. v. The Board of Transportation, G.R. No. L-
59234, September 30, 1982
FACTS: On 10 October 1977, the Board of Transportation (BOT) issued Memorandum
Circular No. 77-42 which has for its purpose the phasing out of old and dilapidated taxis
which are 6 years older. The order was set to be immediately implemented in Metro
Manila and thereafter, on a date to be fixed by the BOT, it will be implemented outside
Metro Manila. Pursuant to this, the Director of the Bureau of Land Transportation issued
Implementing Circular No. 52. Taxicab Operators of Metro Manila, Inc. (TOMMI)
assailed the constitutionality of the law. It avers, among other things, that the Circular in
question violates their right to equal protection of the law because the same is being
enforced in Metro Manila only and is directed solely towards the taxi industry. At the
outset it should be pointed out that implementation outside Metro Manila is also
envisioned in Memorandum Circular No. 77-42.

ISSUE: Whether or not Memorandum Circular 77-42 is valid?

RULING: The SC held that Memorandum Circular No. 77-42 is valid. The overriding
consideration is the safety and comfort of the riding public from the dangers posed by
old and dilapidated taxis. BOT exercised its police power by prescribing regulation to
promote public safety.

BOT’s reason for enforcing the Circular initially in Metro Manila is that taxicabs therein,
compared to those in other places, are subjected to heavier traffic pressure and more
constant use. Considering that traffic conditions are not the same in every city, a
substantial distinction exists so that infringement of the equal protection clause can
hardly be successfully claimed.
In so far as the non-application of the assailed Circulars to other transportation services
is concerned, it need only be recalled that the equal protection clause does not imply
that the same treatment be accorded all and sundry. It applies to things or persons
identically or similarly situated. It permits of classification of the object or subject of the
law provided classification is reasonable or based on substantial distinction, which make
for real differences, and that it must apply equally to each member of the class. What is
required under the equal protection clause is the uniform operation by legal means so
that all persons under identical or similar circumstance would be accorded the same
treatment both in privilege conferred and the liabilities imposed. The challenged
Circulars satisfy the foregoing criteria.

Lupangco v. Court of Appeals, G.R. No. 77372, April 1988

FACTS: On October 6, 1986, the Professional Regulation Commission (PRC) issued
Resolution No. 105, which contained provisions aimed at preserving the integrity of
licensure examinations in accountancy. Among its provisions, the resolution prohibited
examinees from attending review classes, receiving review materials, or obtaining tips
from any educational institution or review center in the three days leading up to the
examination day. Petitioners filed with RTC Manila, Branch 32, a complaint for
injunction with issuance of a writ of a preliminary injunction against respondent
enforcing said resolution to be declared unconstitutional. Respondent PRC then filed
amotion to dismiss on the ground that lower court had no jurisdiction to review and to
enjoin the enforcement of its resolution. However, lower court declared it had jurisdiction
to try the case and enjoined respondent commission from enforcing and giving effect to
Resolution No. 105 which was ordered to be unconstitutional. Unsatisfied, respondent
filed with the Court of Appeals a petition for nullification of order by the lower court
where the same petition has been granted. CA filed a petition for the nullification of the
Order of the lower court declaring the Resolution to be unconstitutional and in deciding
the same, stated as its basis, citing the cases Pineda vs. Lantin and Philippine Pacific
Fishing Co., Inc. vs. Luna and decided to conclude that the PRC and the RTC are co-
equal bodies. On the contrary, the Supreme Court held that nowhere in the said cases
was it held that a Court of First Instance has no jurisdiction over all other government
agencies. Rather, the ruling was specifically limited to the Securities and Exchange
Commission.

ISSUE:
(1) Whether or not the RTC, as a judicial body, has the authority to review and restrain
the actions of an administrative agency like the PRC.
(2) Whether or not the resolution, as an administrative regulation issued by the PRC, is
reasonable, within the scope of the agency's authority, and consistent with constitutional
principles, particularly those pertaining to liberty and academic freedom
RULING:
(1) The Supreme Court held that the Regional Trial Court had jurisdiction over the case.
It reasoned that there was no specific provision in the law precluding the court from
reviewing and restraining the actions of the PRC. Therefore, the lower court's
jurisdiction was upheld.

(2) Regarding the constitutionality of Resolution No. 105,the Supreme Court declared
the resolution null and void. It found that the resolution was unreasonable and arbitrary
in prohibiting examinees from attending review classes and receiving review materials
in the days leading up to the examination. Additionally, the resolution infringed upon the
examinees' rights to liberty and academic freedom. The Court emphasized that while
the PRC's intention to preserve the integrity of licensure examinations was
commendable, Resolution No. 105 was not a reasonable or lawful means to achieve it.

[Link]
lupangco-v-ca-case-digest/96296905

Shell Philippines, Inc. v. Central Bank of the Philippines, G.R. No. L-51353, June 27,
1988
FACTS:
ISSUE:
RULING:

Cebu Oxygen & Acetylene Co. v. Drilon, G.R. No. 8284999, August 2, 1989
Boie-Takeda Chemicals Inc. v. De La Serna, G.R. No. 92174, December 10, 1993
Corona v. United Harbor Pilots Association, G.R. No. 111953, December 12, 1997
Executive Secretary v. South wing Heavy Industries, Inc., G.R. No. 164171, February
20, 2006

iii. Administrative Rules with Penal Sanctions; Requisites for Validity

Cases:
• United States v. Panlilio, 28 Phil. 608 (1914)
• United States v. Santos, 62 Phil. 300 (1936)
• People v. Que Po Lay, 94 Phil. 640 (1954)
• People v. Hon. Maceren, G.R. No. L-32166, October 18, 1977
• Pesigan v. Judge Angeles, G.R. No. L-64279, April 30, 1984