A7S20Spouses Constantino v. Cuisia

CASE DIGEST Spouses Constantino v. Cuisia [G.R. No. 106064, 13 October 2005] Tingga FACTS Petition for certiorari, prohibition and mandamus of the Philippine Comprehensive Program for 1992.Petitioners are members of the non-government organization, Freedom from DebtCoalition, which advocates a “pro-people and just Philippine debt policy.” They question the Financing Program started by then President Corazon Aquino, characterized as a “multi -option financing package”, wherein the President entered into three restructuring agreements with foreign creditor governments. Petitioners stress that unlike other powers which may be validly delegated by the President, the power to incur foreign debts is expressly reserved by the Constitution in the person of the President.

ISSUES

1. WON the President can borrow to meet

ARTICLES/LAWS INVOLVED SECTION 20. The President may contract or guarantee foreign loans on behalf of the Republic of the Philippines with the prior concurrence of the Monetary Board, and subject to such limitations as may be provided by law. The Monetary Board shall, within thirty days from the end of every quarter of the calendar year, submit to the Congress a complete report of its decisions on applications for loans to be contracted or guaranteed by the Government or government-owned and controlled corporations which would have the effect of increasing the foreign debt, and containing other matters as may be provided by law. HELD

publice expenditures in the form of bonds 2. WON the President can delegate the power to incur foreign debts to other executive agencies.

1st issue: The Scope of Section 20, Article VII Petioner: buyback and bond-conversion schemes do not constitute the loan contract or guarantee contemplated in the Constitution Court: The language of the Constitution is simple and clear as it is broad. It allows the President to contract and guarantee foreign loans. It makes no prohibition on the issuance of certain kinds of loans or distinctions as to which kinds of debt instruments are more onerous than others. This Court may not ascribe to the Constitution meanings and restrictions that would unduly burden the powers of the President. The plain, clear and unambiguous language of the Constitution should be construed in a sense that will allow the full exercise of the power provided therein. It would be the worst kind of judicial legislation if the courts were to misconstrue and change the meaning of the organic act. The only restriction that the Constitution provides, aside from the prior concurrence of the Monetary Board, is that the loans must be subject to limitations provided by law. In this regard, we note that Republic Act (R.A.) No. 245 as amended by Pres. Decree (P.D.) No. 142, s. 1973, entitled An Act Authorizing the Secretary of Finance to Borrow to Meet Public Expenditures Authorized by Law, and for Other Purposes, allows foreign loans to be contracted in the form of, inter alia, bonds. Thus:

Sec. 1. In order to meet public expenditures authorized by law or to provide for the purchase, redemption, or refunding of any obligations, either direct or guaranteed of the Philippine Government, the Secretary of Finance, with the approval of the President of the Philippines, after consultation with the Monetary Board, is authorized to borrow from time to time on the credit of the Republic of the Philippines such sum or sums as in his judgment may be necessary, and to issue therefor evidences of indebtedness of the Philippine Government." Such evidences of indebtedness may be of the following types:

.... c. Treasury bonds, notes, securities or other evidences of indebtedness having maturities of one year or more but not exceeding twenty-five years from the date of issue. (Emphasis supplied.) Under the foregoing provisions, sovereign bonds may be issued not only to supplement government expenditures but also to provide for the purchase, redemption, or refunding, of any obligation, either direct or guaranteed, of the Philippine Government. Buy-Back Scheme -It is true that in the balance of power between the three branches of government, it is Congress that manages the countrys coffers by virtue of its taxing and spending powers. However, the law-making authority has promulgated a law ordaining an automatic appropriations provision for debt servicing by virtue of which the President is empowered to execute debt payments without the need for further appropriations. Regarding these legislative enactments, this Court has held. - It is true that in the balance of power between the three branches of government, it is Congress that manages the countrys coffers by virtue of its taxing and spending powers. However, the law-making authority has promulgated a law ordaining an automatic appropriations provision for debt servicing by virtue of which the President is empowered to execute debt payments without the need for further appropriations. Regarding these legislative enactments, this Court has held, 2nd issue delegation of power Ratio/Doctrineon Delegation of power Based on the Doctrine of Qualified Political Agency. Each head of thedepartment is and must be, the President’s alter ego in the matters of that department where the President is required by law to exercise authority.

Third Issue: Grave Abuse of Discretion and Violation of Constitutional Policies Assuming the accuracy of the foregoing for the nonce, despite the watered-down parameters of petitioners computations, we can make no conclusion other than that respondents efforts were geared towards debt-relief with marked positive results and towards achieving the constitutional policies which petitioners so hastily declare as having been violated by respondents. We recognize that as with other schemes dependent on volatile market and economic structures, the contracts entered into by respondents may possibly have a net outflow and therefore negative result. However, even petitioners call this latter event the worst-case scenario. Plans are seldom foolproof. To ask the Court to strike down debt-relief contracts, which, according to independent third party evaluations using historically-suggested rates would result in substantial debt-relief, based merely on the possibility of petitioners worst-case scenario projection, hardly seems reasonable. Conclusion That the means employed to achieve the goal of debt-relief do not sit well with petitioners is beyond the power of this Court to remedy. The exercise of the power of judicial review is merely to check not supplant the Executive, or to simply ascertain whether he has gone beyond the constitutional limits of his jurisdiction but not to exercise the power vested in him or to determine the wisdom of his act. In cases where the main purpose is to nullify governmental acts whether as unconstitutional or done with grave abuse of discretion, there is a strong presumption in favor of the validity of the assailed acts. The heavy onus is in on petitioners to overcome the presumption of regularity. DISMISSED.