I. ADMINISTRATIVE LAWS Scope of Power of Administrative Agencies01. What are the two basic delegated powers of administrative agencies? What are the two tests

of valid delegation?ANSWERS: Quasi-judicial and quasi-legislative. In exercising its quasi-judicial function, an administrative body adjudicates the rights of persons before it, in accordance with the standards laid down by law, including the requirements of notice and hearing. The determination of facts and the applicable laws, as the basis for official action and the exercise of judicial discretion, are essential for the performance of this function. Quasi-legislative power is exercised by administrative agencies through the promulgation of rules and regulations within the confines of the granting statute and the doctrine of non-delegation of certain powers flowing from the separation of the great branches of the government. Prior notice and hearing are not essential to the validity of rules or regulations promulgated to govern future conduct. (Abella vs. CSC, 442 SCRA 507)

The two tests of valid delegation are the 1) completeness test and 2) sufficient standard test. Under the first test, the law must be complete in all its terms and conditions when it leaves the legislature such that when it reaches the delegate, the only thing he will have to do is to enforce it. The second test mandates that there should be adequate guidelines or limitations in the law to determine the boundaries of the delegate’s authority and prevent the delegation from running riot. (Ibid.)02. Is the establishment of a national computerized identification reference system by virtue of

an administrative order issued by the President valid?ANSWER: NO. An administrative order is an ordinance issued by the President which relates to specific aspects in the administrative operation of the government. Administrative Order No. 308 did not merely implement the Administrative Code. It establishes a national computerized identification reference system which requires a delicate adjustment of various contending state policies, the primacy of national security, the extent of privacy against dossier-gathering by the government, and choices of policies. It deals with a subject that should be covered by law. (Ople vs. Torres, 293 SCRA 141)Operation and Effects of Laws; Publication Requirement 03. When do laws take effect? ANSWERS: Where a law provides for its own date of effectivity, such date prevails over that prescribed by E.O. 200. There is nothing in E.O. 200 that prevents a law from taking effect on the date other than or even before the 15-day period after its publication. What is mandatory and what due process requires is the publication of the law, for without such notice and publication, there would be no basis for the application of the maxim “ignorantia legis neminem excusat.” (La Bugal-B’laan Tribal Association vs. Ramos, GR No. 127882, January 27, 2004)

Subdelegation of authority04. What do you understand by the doctrine of subdelegation of authority? Is this permissible

in this jurisdiction? Discuss its rationale.Subdelegation of authority is the transmission of authority from the heads of

agencies to subordinates. Settled is the rule that a delegate may exercise his authority through persons he appoints to assist him in the performance of his functions as long as the decisions remains within the scope of his jurisdiction and is made by such officer.

The following instances of subdelegation of power have been sustained as valid: a) the President under the doctrine of qualified political agency delegates power and

authority to the members of his official family who are considered as his alter ego. (Carpio vs. Executive Secretary, 206 SCRA 290) and

b) the Securities and Exchange Commission may delegate to subordinate officials the authority to exercise the specific powers assigned to it by law. (Skyworld Condominium Owners Association vs. SEC, 211 SCRA 565)

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This is permissible in administrative proceedings because subdelegation of power is dictated by sound management principles and the exigencies of the service. By subdelegation of authority which is demanded by administrative efficiency, the leaders in the hierarchy of an organization must be able to concentrate their attention upon a larger and more important questions of policy and practice, and their time free, as much as possible, from the consideration of a smaller and far less matters of details unless by provision of law it is withheld. (American Tobacco Co. vs. Director of Patents, 67 SCRA 287)

Subdelegation of authority is permissible in order to achieve prompt and expeditious discharge of public functions and responsibilities. To withhold such power to subdelegate the authority would be to impair administrative efficiency. Moreover, the 1987 Constitution commands public officers and employees to serve with utmost efficiency, hence to insure compliance with this constitutional mandate, subdelegation must, perforce, be allowed to attain prompt and efficient service.

Rule-making power05. What are the requisites for a valid exercise of rule-making power by an administrative

agency?ANSWER: The requisites are:1) the rule must be issued under the authority of law or its promulgation must be

authorized by the legislature; 2) the administrative issuance must be within the scope and purview of the law; or

authority given by the legislature3) the rule must be promulgated in accordance with the prescribed procedure,

including public participation, filing and publication; As a general rule, prior notice and hearing are not essential to the validity of rules and regulations promulgated to govern future conduct. (Abella vs. CSC, 442 SCRA 507); and

3) the rules must be reasonable (KMU vs. Director-General, NEDA, GR No.167798, April 19, 2006) .

Additional requisites if rules contain penal sanctions1) Law itself must declare as punishable the violation of administrative rule or

regulation (People vs. Maceren, 79, SCRA 450); and2) Law should define or fix penalty therefor.

In Perez vs. LPG Refillers Association of the Philippines, 492 SCRA 638, the Supreme Court cited two requisites for an administrative regulations to have force and effect of penal law, to wit:1) the violation of the administrative regulation must be made a crime by the

delegating statute itself, and2) the penalty for such violation must be provided by the statute itself.

06. Can POEA Administrative Circular No 2, Series of 1983, issued pursuant to the agency’s quasi-legislative power, be used as a basis for the imposition of administrative sanctions against erring recruitment agencies?

ANSWER: NO. Considering that POEA Administrative Circular No. 2 Series of 1983, has the force and effect of a law and has not yet been published or filed with the National Administrative Register, the same is ineffective and may not be enforced.

Under Book VI, Chapter II, Section 3 of the Administrative Code of 1987 “rules in force on the date of effectivity of this Code which are not filed within three (3) months from that date shall not thereafter be the basis of any sanction against any party or persons.” An Administrative Circular that was never filed with the NAR cannot be used as basis for the imposition of administrative sanctions. The fact that POEA Administrative Circular No. 2 is addressed only to specified group-namely private employment agencies or authority holders, does not take it away from the ambit of the ruling in Tanada vs. Tuvera, 136 SCRA 27, which is clear and categorical –

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administrative rules and regulations must be published if their purpose is to enforce or implement existing law pursuant to a valid delegation. (Philsa International Placement and Service Corporation vs. Secretary of Labor, 356 SCRA 174)07. Is OMB-DOJ Joint Circular NO. 95-001 ineffective on the ground that it was not published?ANSWER: The circular is merely an internal circular between the DOJ and the Office of the Ombudsman, outlining authority and responsibilities among prosecutors of the DOJ and the Office of the Ombudsman in the conduct of preliminary investigation. The circular DOES NOT regulate the conduct of persons or the public in general. Internal regulations and those merely internal in nature, that is, regulating only the personnel of the administrative agency and not the public, need not be published. Neither is publication required of the so-called letters of instruction issued by administrative superiors concerning rules or guidelines to be followed by their subordinates in the performance of their duties. (Honasan vs. The Panel of Investigating Prosecutors of the DOJ, GR No. 159747, April 13, 2004)Rate-fixing08. An administrative agency passes a resolution prescribing rates. Should there be prior notice

and hearing to the parties to be affected by the rates fixed? Explain.ANSWER: It depends. In Philippine Consumers Foundation Philippines vs. Secretary of DECS, 153 SCRA 622, it was held that the function of prescribing rates by an administrative agency may either be a legislative or an adjudicative function. If it were a legislative function, the grant of prior notice and hearing to the affected parties is not a requirement of due process. As regards rates prescribed by an administrative agency in the exercise of its quasi-judicial function, prior notice and hearing are essential to the validity of such rates. Where the rules and the rates are meant to apply to all enterprises of a given kind throughout the country, they may partake of a legislative character. But if they apply exclusively to a particular party based upon a finding of facts, then its function is quasi-judicial in character.09. Does the Energy Regulatory Commission have the power to grant provisional rate

adjustments? What is the procedural requirement in the exercise of such power?ANSWERS: YES. The power to approve provisional rate increases is included among the powers transferred to the ERC and the grant of such authority is not inconsistent with the EPIRA. Neither is the notion of provisional rate adjustment incompatible with the policy to protect public interest. The ERC is required to conduct a full-blown hearing on the propriety of the grant of provisional rate adjustments within 30 days from the issuance of the provisional order. (Freedom from Debt Coalition vs. ERC, 432 SCRA 157)Administrative interpretation of the law10. Can administrative bodies interpret laws which they are tasked to enforce? ANSWER: YES. Administrative bodies may interpret the law they are tasked to implement. To otherwise deprive administrative bodies the duty, at the first instance, to interpret the laws which they are mandated to execute would make them impotent bodies. The construction and interpretation given by administrative officers possessed of the necessary special knowledge, expertise and experience of what the law is deserves greatest respect and can only be set aside on proof of gross abuse of discretion. (PLDT vs. NTC, 190 SCRA 717)

It is the general policy of the Supreme Court to sustain the decision of administrative authorities not only on the basis of separation of powers but also for their presumed knowledgeability and even expertise in the laws they are entrusted to enforce. (Santiago vs. Dep. Exec. Secretary, 192 SCRA 199)

The interpretation of an administrative government agency, which is tasked to implement a statute, is accorded great respect and ordinarily controls the construction of the courts. When an administrative agency renders an opinion or issues a statement of policy, it merely interprets a pre-existing law and the administrative interpretation is at best advisory for it is the courts that finally determine what the law means. (Melendres, Jr. Vs. COMELEC, 319 SCRA 262 and Baltazar vs. COMELEC, 350 SCRA 518,)

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Power to issue subpoena and cite for contempt11. Are administrative agencies granted the power to issue subpoena and punish individuals for

contempt?ANSWER: As a general rule, the power to issue subpoena and cite a person in contempt is not inherent to an administrative agency and thus depends on a statutory grant. Without such grant, a person must apply in court. EO 292 grants administrative agencies in general the power to issue subpoenas by requiring the attendance of witnesses or the production of documents. (Book VII, Sec. 13), but only as an incident of their power to investigate.

The power to punish contempt must be expressly granted to the administrative body; and when so granted may be exercised only when the administrative body is actually performing quasi-judicial functions. The COMELEC, SEC and the Insurance Commissioner are granted these powers by special statutory grant.

In cases of violation of its rules of procedures, the Commission on Human Rights may cite for contempt a person in accordance with the Rules of Court. (Carino vs. CHR, 204 SCRA 483) The Commission on Human Rights, in cases of violation of its rules of procedure may cite a person for contempt in accordance with the Rules of Court. (Carino vs. CHR, 204 SCRA 483) Likewise, the authority to conduct hearings or inquiries and the power to hold any person in contempt may be exercised by the Cooperative Development Authority but limited only in the performance of its administrative functions. (CDA vs. Dolefil Agrarian Reform Beneficiaries Cooperative Inc, 382 SCRA 552)

Other powers; Form and promulgation of quasi-judicial determination12. Are administrative bodies in the performance of their quasi-judicial functions?

(1) authorized to grant immunities from criminal and civil prosecutions;(2) empowered to award damages in civil case; (3) required to state the facts clearly and distinctly stating therein the legal basis when

rendering decisions?ANSWERS:(1) NO. The rule is that administrative bodies in the performance of their quasi- judicial functions cannot grant criminal and civil immunities to persons unless the law explicitly and specifically confers such prerogative or power. EXCEPTIONS: Insofar as the PCGG is concerned, it is conferred such power under Sec. 5 of EO No. 14. (Republic vs. Sandiganbayan, 173 SCRA 72) Also, the Commission on Human Rights may grant immunity from prosecution to any person whose testimony or whose possession of documents or other evidence is necessary or convenient to determine the truth. (Carino vs. Commission on Human Rights, 204 SCRA 483) (2) Powers of administrative agencies are limited and usually administrative in nature. In case of injury or inconvenience suffered by a person because of breach of contractual obligation arising from negligence, the proper forum for him to ventilate their grievances for possible recovery of damages should be in the courts and not in administrative agencies. Being a creature of the legislature, administrative agencies can exercise only such jurisdiction and power as are expressly or by necessary implication conferred upon it by statute. (RCPI vs. Board of Communications, L-43653, L-45378, November 29, 1977)

Exceptions. However, the National Housing Authority (now the Housing and Land Use Regulatory Board) has been conferred by PD 1344, the competence to award damages including attorney’s fees which are recoverable either by agreement of the parties or under Article 2208 of the Civil Code. (Solid Homes vs. Payawal, 177 SCRA 72) Likewise, in GMA Network, Inc. vs. ABS-CBN Broadcasting Corp, 470 SCRA 727, it was held that where the wrongful acts complained of and upon which the damages prayed for are based have to do with the operation and ownership of cable companies, the resolution of these factual matters undoubtedly pertains to the National Telecommunications Commission and not the regular courts. While it is true that the regular courts are possessed of general jurisdiction over actions for damages, it would nonetheless be

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proper for the courts to yield its jurisdiction in favor of an administrative body when the determination of underlying factual issues requires the special competence or knowledge of the latter.

(3) YES. Every decision of an agency shall be in writing and shall state the facts and the law on which it is based. (Book VII, Section 14) The mandate of Section 14, Article VIII of the Constitution requiring courts to state clearly and distinctly the facts and the legal basis of their decisions is equally applicable to administrative bodies. (Naguiat vs. NLRC, 269 SCRA 564 and Pilipinas Kao Inc. vs. CA, 372 SCRA 548))

Administrative Due Process13. What rights are included in administrative due process? ANSWER: Administrative due process is recognized to include the right to:A. Procedural Due Process1) Notice, be it actual or constructive, of the institution of the proceedings that may

affect a person’s legal right;2) Reasonable opportunity to appear and defend his rights, and to introduce

witnesses and relevant evidence in his favor;B. Substantive Due Process3) A tribunal so constituted as to give him reasonable assurance of honesty and

impartiality, and one of competent jurisdiction; 4) And a finding or decision by that tribunal supported by substantial evidence

presented at the hearing, or at least ascertained in the records or disclosed to the parties. (Air Manila, Inc. vs. Balatbat, 38 SCRA 489 and Fabella vs. CA, 282 SCRA 256)

14. In administrative proceedings, including those before the Ombudsman, may cases be submitted for resolution on the basis of affidavits and pleadings without violating due process?

ANSWER: YES. It is not legally objectionable for being violative of due process for an administrative tribunals to resolve a case based solely on position papers, affidavits or documentary evidence submitted by the parties as affidavits of witnesses may take the place of their direct testimonies. (Marcelo vs. Bungubung, 552 SCRA 589)

15. Is it mandatory for administrative bodies to conduct trial- type proceedings as a requirement of due process? ANSWER: NO. A formal trial type hearing is not at all times essential to due process. Where the litigants are given the opportunity to be heard either through oral arguments or pleadings, procedural due process is fulfilled. The essence of due process is found in the reasonable opportunity to be heard and submit evidence in support of one’s defense. Exceptions: (1) In quasi judicial proceedings when an adjudicative fact is at issue, a trial-type hearing ought to be held. (Mabuhay Textile Mills Corp. Vs Ongpin, 141 SCRA 437) (2) actual adversarial proceedings become necessary only for clarification or when there is a need to profound searching questions to witnesses who give vague testimonies. In labor cases, it is a procedural right which the employee must ask for. It is not an inherent right. If petitioner requested that an investigation be conducted but respondents vehemently refused, clearly the petitioner was deprived of his right to due process. (Lavador vs. “J” Marketing Corp., 461 SCRA 497)

16. Give at least six (6) instances when notice and hearing are not required in administrative proceedings.

ANSWER:1. Grant of provisional authority for increased rates, or to engage in a particular line of

business;2. Summary proceedings of distraint and levy upon the property of a delinquent

taxpayer;

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3. Cancellation of a passport where no abuse of discretion is committed by the Foreign Secretary;

4. Summary abatement of nuisance per se which affects the immediate safety of persons or property.

5. Summary sequestration of ill-gotten wealth by the PCGG.6. Preventive suspension of a public officer pending investigation.Exhaustion of Administrative Remedies17.

(1) Discuss the doctrine of exhaustion of administrative remedies and its exceptions. When is it applicable? What is its rationale?

(2) What is the effect of the failure to observe the doctrine?ANSWERS:(1) The doctrine of exhaustion of administrative remedies simply provides that before a

party-litigant can seek judicial intervention, he must exhaust all means of administrative redress available under the law. The exceptions are:

1) doctrine of qualified political agency, when the respondent is a department secretary whose acts as an alter ego of the President bears the implied and assumed approval of the latter; except where law expressly provides exhaustion;

2) issue involved is purely legal3) administrative remedy is fruitless;4) where there is estoppel on the part of the administrative agency;5) administrative action is patently illegal, amounting to lack or excess of jurisdiction;6) where there is unreasonable delay or official inaction;7) where there is irreparable injury, or threat thereof, unless judicial recourse is

immediately made8) in land case, where the subject matter is a private land;9) where law does not make exhaustion a condition precedent to judicial recourse;10) where observance of the doctrine will result in nullification of claim;11) where there are special reasons or circumstances demanding immediate court action; 12) when due process of law is clearly violated.13) when the issue is rendered moot and academic (Land Bank of the Philippines vs.

Court of Appeals, 318 SCRA 144)14) when the issue is invested with public interest. In the case of, Indiana Aerospace

University vs. CHED, 356 SCRA, the Supreme Court ruled that it is patently clear that the regulation or administration of educational institutions, especially on tertiary level, is invested with public interest. Hence the haste with which the solicitor general raised these issues before the appellate court is understandable. For the reason mentioned, the respondent’s petition for certiorari did not require prior resort to a motion for reconsideration.

The rule on exhaustion of administrative remedies applies only where there is an express legal provision requiring such administrative step as a condition precedent to taking action in court. (CSC vs. DBM, 464 SCRA 11)

One of the reasons for the doctrine of exhaustion of administrative remedies is the separation of powers which enjoins upon the judiciary a becoming policy of non-interference with matters coming primarily within the competence of other department. The legal reason is that the courts should not act and correct its mistakes or errors and amend its decision on a given matter and decide it properly. (Lopez vs. City of Manila, 303 SCRA 448) And the practical reason is that the administrative process is intended to provide less expensive and more speedy solution to disputes.(2) Failure to exhaust administrative remedies will not affect the jurisdiction of the courts. Non-compliance with the doctrine will deprive the complainant of a cause of action which is a ground for a motion to dismiss the case. However, if no motion to dismiss is filed on this ground, there is deemed to be a waiver. (Rosario vs. CA, 211 SCRA 384 and Baguioro vs. Basa, 214 SCRA 437)

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However, in the case of MERALCO vs. Barlis, 317 SCRA 832, the Supreme Court ruled that, an error in the assessment must be administratively pursued to the exclusion of ordinary courts whose decision would be void for lack of jurisdiction.

Primary Jurisdiction18. (1) Explain the doctrine of primary jurisdiction.

(2) What is the effect of failure to observe the doctrine?

ANSWERS: (1) The Doctrine of Primary Jurisdiction means that judicial action of a case is deferred pending the determination of some issues which properly belong to an administrative body because their expertise, specialized skills, knowledge and resources are required for the resolution of factual and non-legal matters. In such a case, relief must first be sought and obtained in the administrative body concerned before the remedy will be supplied by the Court. Where a statute lodges exclusive original jurisdiction in an administrative agency, the courts will refuse to take up a case unless the agency has finally completed its proceedings.

The doctrine does not warrant a court to arrogate unto itself authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative body of special competence. (Roxas & Co. Inc. vs. Court of Appeals, 321 SCRA 106 and Province of Zamboanga del Norte vs. Court of Appeals, 342 SCRA)(2) The application of the doctrine of primary jurisdiction does not call for the immediate dismissal of the case pending before the court. The case is merely suspended until the issues resolvable by the administrative body are threshed out and fully determined. (Industrial Enterprises, Inc. vs. CA, 184 SCRA 426)

Judicial Review and Jurisdiction19. Are acts and decisions of administrative agencies subject to judicial review?

ANSWER: YES. Given the expanded scope of judicial review as including the power to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government, the courts can review acts of all administrative agencies, not only in the performance of their adjudicative function (generally by the Court of Appeals through the special civil action of certiorari), but even in the performance of their other functions including quasi-legislative or rule-making and administrative functions (by the RTC).

Courts have the power to scrutinize the acts of administrative agencies even though no right of review is given by statute. Judicial review is proper in case of lack of jurisdiction, grave abuse of discretion, error of law, fraud or collusion. (Dabuet vs. Roche Pharmaceuticals, Inc., 149 SCRA 386)

20. What courts exercise the power of judicial review over administrative determinations?

ANSWER:General Rule: It is the Court of Appeals that is conferred with the power of

judicial review over the decisions of administrative agencies. except COMELEC, COA, and Ombudsman in criminal cases in which case the Supreme Court exercises jurisdiction.

BP 129 provides that the Court of Appeals shall exercise “xxx exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of quasi-judicial agencies, instrumentalities, boards or commissions, except those falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution.”

Likewise, Rule 43 of the 1997 Rules of Civil Procedure provides that the Court of Appeals shall have appellate jurisdiction over awards, judgments, final orders or resolutions of any quasi-judicial agency in the exercise of its quasi- judicial function.

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Thus, if a party disagrees with the decision of the Office of the President, he should elevate the matter by petition for review before the Court of Appeals for the latter’s exercise of judicial review, pursuant to Sec. 9(3) of BP 129. (Sanado vs. CA, 356 SCRA 546 and Serondo vs. CA, 375 SCRA 167)

As with other administrative agencies discharging quasi-judicial functions, recourse must first be had through the Court of Appeals under Rule 43 of the 1997 Rules of Civil Procedure on the orders, resolutions or decisions of the following: (1) the Commission on the Settlement of Land Problems (COSLAP) (Republic vs. Damayan ng Purok 14, INC., GR No. 143135, April 4, 2003), (2) the Board of Commissioners of the Bureau of Immigration (Agus Dwikarma vs. Domingo, GR No. 153454, July 7, 2004), (3) voluntary arbitrators (Silver Trading Co. vs. Semana, GR No. 152456, April 28, 2004), (4) National Labor Relations Commission (St. Martin Funeral Homes vs. NLRC, 295 SCRA 494), (5) Secretary of Labor (National Federation of Labor vs. Laguesma, 304 SCRA 407), (6) Director of Bureau of Labor Relations (Abbot Laboratories Phil. Vs. Abbot Laboratories Employees Union) and (7) DOJ Secretary in petitions for review (Public Utilities Department, Olongapo City vs.Guingona, 365 SCRA 467)

Exceptions: The Supreme Court, however, exercises appellate jurisdiction over all final judgments, decisions, resolutions or orders of the COMELEC, Commission on Audit and Ombudsman in criminal cases in accordance with the Constitution. (Garcia-Rueda vs. Pascasio, 278 SCRA 769) Rule 43 of Rules on Civil Procedure provides that final resolutions of the Civil Service Commission shall be appealable by certiorari to the Court of Appeals.

Likewise, under RA 9282, the Court of Tax Appeals exercises appellate jurisdiction over the decisions or ruling of the Central Board of Assessment Appeals, Customs Commissioner, BIR, and the Secretaries of the DOF, DA and DTI.

21. Is a government-owned and controlled corporation part of the Government of the Philippines? Is the Polytechnic University of the Philippines part of the government? When is a government-owned or controlled corporation deemed to be performing proprietary function? When is it deemed to be performing governmental function?

ANSWER: A government-owned and controlled corporation which also performs governmental function is a part of the government. If it solely performs proprietary functions, then it is not. The PUP and the NDC have their respective charters and therefore each possesses a separate and distinct individual personality. Beyond cavil, a government-owned and controlled corporation has a personality of its own distinct and separate from that of the government. (PUP vs. CA, 368 SCRA 691)

Government-owned or controlled corporations may perform governmental or proprietary functions or both, depending on the purpose for which they have been created. If the purpose is to obtain special corporate benefits or earn pecuniary profit, the function is proprietary. If it is in the interest of health, safety and for the advancement of public good and welfare, affecting the public in general, the function is governmental. Powers classified as “proprietary” are those intended for private advantage and benefits. (Blaquera vs. Alcala, 295 SCRA 366)

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