Poli Law Velasco Cases by Dean Candelaria.pdf

PHILIPPINE ASSOCIATION OF LAW SCHOOLS

BAR OPS PILIPINAS 2016

POLITICAL LAW Prepared by: Dean Sedfrey Candelaria and students of Ateneo de Manila University

FUNA v. VILLAR [GR. No. 192791; April 24, 2012]

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On 15, 2001, PGMA appointed as Feb. COA2,Chairman (7-year term). Carague’s termFeb. of office started on Feb. 2, 2001,Carague to end on 2008. On Feb. 7, 2004, Villar was appointed as the third member of COA (7-year term) starting Feb. 2, 2004 until Feb. 2, 2011. Following the retirement of Carague on Feb. 2, 2008 and during the fourth year of Villar as COA Commissioner, Villar was designated as Acting Chairman of COA from Feb. 4, 2008 to April 14, 2008. Subsequently, on April 18, 2008, Villar was nominated and appointed as COA Chairman. Thereafter, the Commission on Appointments confirmed his appointment. He was to serve as COA Chairman until the expiration of the srcinal term of his office as COA Commissioner or on Feb. 2, 2011. Meanwhile, Evelyn R. San Buenaventura (San Buenaventura) was appointed as COA Commissioner to serve the unexpired term of Villar as Commissioner or up to Feb. 2, 2011. Challenged in this recourse, Villar insists that his appointment as COA Chairman accorded him a fresh term of seven (7) years. He argues that his term of office as such COA Chairman, is up to Feb. 2, 2015, or 7 years reckoned from Feb. 2, 2008 when he was appointed to that position.

Issues: 1) WON a promotional appointment from the position of Commissioner to Chairman is constitutionally permissible and does not constitute reappointment as barred by the Article IX (D), Sec 1 (2) of the Constitution. 2) WON the appointment of Villar to the position of COA Chairman is valid.

Held: 1) YES. Section 1(2) of Art. IX(D) of the Constitution 1 does not prohibit a promotional appointment from commissioner to chairman as long as the commissioner has not served the full term of seven years. In addition, such promotional appointment to the position of Chairman must conform to the rotational plan or the staggering of terms in the commission membership such that the aggregate of the service of the Commissioner in said position and the term to which he will be appointed to the position of Chairman must not exceed seven years so as not to disrupt the rotational system in the commission prescribed by Sec. 1(2), Art. IX(D). Reappointment found in Sec. 1(2), Art. IX(D) means a movement to one and the same office (Commissioner to Commissioner or Chairman to Chairman). On the other hand, an appointment involving a movement to a different position or office (Commissioner to Chairman) would constitute a

1 Sec. 1(2), Art. IX(D) of the Constitution. (2) The Chairman and Commissioners [on Audit] shall be appointed by the President with the consent of the Commission on Appointments for a term of seven years without reappointment. Of those first appointed, the Chairman shall hold office for seven years, one commissioner for five years, and the other commissioner for three years, without reappointment. Appointment to any vacancy shall be only for the unexpired portion of the term of the predecessor. In no case shall any member be appointed or designated in a temporary or acting capacity. new appointment and, hence, not, in the strict legal sense, a reappointment barred under the Constitution. Page | 1 PALS BAR OPS PILIPINAS 2016

2) NO. In light of the 7-year aggregate rule, Villar’sappointment to a full term is not valid as . A shorter he will be allowed to serve more than seven 7 years under the constitutional ban term, however, to comply with said rule would also be invalid as the corresponding appointment would effectively breach thefirst clearset purpose of the Constitution of giving to every appointee so appointed subsequent to the of commissioners, a fixed term of office of 7 years. To recapitulate, a COA commissioner like respondent Villar who serves for a period less than seven (7) years cannot be appointed as chairman when such position became vacant as a result of the expiration of the 7-year term of the predecessor (Carague). Such appointment to a full term is not valid and constitutional, as the appointee will be allowed to serve more than seven (7) years under the constitutional ban.

HACIENDA LUISITA v. PARC [GR. No. 171101; November 22, 2011]

Facts: • Pursuant to PD 27, tenant-farmers, depending on the size of the landholding worked on, can either purchase the land they tilled or shift from share to fixed-rent leasehold tenancy. • However, the scope of the PD covered only tenanted, privately-owned rice and corn lands. • Proclamation No. 131, Series of 1987 was issued instituting a comprehensive agrarian reform program (CARP) to cover all agricultural lands, regardless of tenurial arrangement and commodity produced. • EO 229 provided for the mechanisms for CARP implementation and created the Presidential Agrarian Reform Council (PARC) as the highest policy-making body that formulates all policies, rules, and regulations necessary for the implementation of CARP. • The Spanish owners of Tabacalera offered to sell Hacienda Luisita and the sugar mill, • • • •

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Central Azucarera de Tarlac (CAT), within the estate. Tarlac Devt Corp (Tadeco), owned by the Jose Cojuangco Sr. Group, was willing to buy. Tadeco undertook to pay the purchase price for Hacienda Luisita in pesos, while that for the controlling interest in CAT, in US dollars. The PH Govt, thru the then Central Bank, assisted the buyer to obtain a dollar loan from a US bank. In 1957, GSIS also extended a P5.911M loan in favor of Tadeco upon the condition that the lots comprising the Hacienda Luisita shall be subdivided by Tadeco and sold at cost to the tenants, should there be any, and other applicable conditions under the Land Tenure Act. In 1980, the martial law administration filed a suit before the Manila RTC against Tadeco et al, for them to surrender Hacienda Luisita to the then Ministry of Argrarian Reform so that the land can be distributed to farmers at cost. Tadeco et al. alleged that Hacienda Luisita does not have tenants and that besides which sugar lands, of which the hacienda consisted, are not covered by existing agrarian reform legislations. The Manila RTC ordered Tadeco to surrender Hacienda Luisita to the MAR. Tadeco appealed to the CA. The OSG moved to withdraw the govt’’s case against Tadeco et al.

The CA dismissed the case the Marcos govt initially instituted and won against Tadeco et al.

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However, the dismissal action was made subject to the obtention by Tadeco of the PARC’s approval of a stock distribution plan (SDP) that must initially be implemented after such approval shall have been secured. Section 10 of EO 229 allows corporate landowners, as an alternative to the actual land transfer scheme of CARP, to give qualified beneficiaries the right to purchase shares of o

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stocks ration. of the corporation under a stock ownership arrangement and/or land-to-share RA 6657 also provides 2 alternative modalities: land or stock transfer, but subject to conditions and timeline requirements. Under Sec. 31 of RA 6657, corporate landowners may voluntarily transfer o ownership over their agricultural landholdings to the Republic of the Philippines or to qualified beneficiaries. Upon certification by the DAR, corporations owning agricultural lands may give their qualified beneficiaries the right to purchase such proportion of the capital stock of the corporation that the agricultural land, actually devoted to agricultural activities, bears in relation to the company’s total assets. Tadeco organized a spin-off corporation, HLI, as vehicle to facilitate stock acquisition by the farmworkers. Tadeco assigned and conveyed to HLI the agricultural land portion and other farm-related properties of Hacienda Luisita in exchange for HLI shares of stock. Tadeco increased its capital stock from P1.5M to P400M with par value of P1/share. 150M shares were to be issued only to qualified and registered beneficiaries of the CARP and the remaining 250M to any stockholder of the corporation. 93% of the then farmworker-beneficiaries (FWBs) complement of Hacienda Luisita signified in a referendum their acceptance of the proposed HLI’s Stock Distribution Option Plan. The Stock Distribution Option Agreement (SDOA), styled as a MOA, was entered into by Tadeco, HLI, and the qualified FWBs as attested to by then DAR Secretary Philip Juico. The ration of the land-to-shares of stock corresponds to 33.3% of the outstanding capital o

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stock of the HLI, equivalent to 118M shares of stock. The SDP was approved in 1989. In 1995, HLI applied for the conversion of 500 hectares of land of the hacienda from agricultural to industrial use, pursuant to Sec. 65 of RA 6657. Sec. 65 of RA 6657: After the lapse of 5 years from its award, when the land o ceases to be economically feasible and sound for agricultural purposes, or the locality has become urbanized and the land will have a greater economic value of residential, commercial or industrial purposes, the DAR, upon application of the beneficiary or the landowner, with due notice to the affected parties, and subject to existing laws, may authorize the reclassification, or conversion of the land and its disposition. The DAR approved the application subject to the payment of 3% of the gross selling price to the FWBs and to HLI’s continued compliance with its undertakings under the SDP, among other conditions. HLI ceded 300 hectares of the converted area to Centennary Holdings Inc. in exchange for subscription of shares of stocks of the latter. HLI transferred the remaining 200 hectares to Luisita Realty Corporation (LRC). Subsequently, Centennary sold the 300 hectares to Luisita Industrial Park Corporation (LIPCO) for the purpose of developing an industrial complex.

LIPCO transferred several parcels of land to RCBC by way of dacion en pago in payment of LIPCO’s loan obligations.

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• Petitioners sought to revoke the SDOA, alleging that HLI failed to give them their dividends and the 1% share in gross sales, and the 33% share in the proceeds of the sale of the converted 500 hectares of land. o They prayed for a renegotiation of the SDOA, or, in the alternative, its revocation. • The DAR constituted a Special Task Force to attend to issues relating to the SDP of HLI, who found that HLI had not complied with its obligations under R A6657 despite the implementation of the SDP. •PARC adopted the recommendation of DAR to recall/revoke the approval of HLI’s SDP and the acquisition of Hacienda Luisita through the compulsory acquisition scheme. • HLI sought reconsideration. •Notwithstanding the MR, HLI filed the petition for certiorari and prohibition under Rule 65 assailing and seeking to set aside the PARC Resolutions. • RCBC and LIPCO moved to intervene, claiming that the revocation of the SDP cannot legally affect their rights as innocent purchasers for value. Issue/s: 1) WON PARC and DAR have jurisdiction, power and/or authority to nullify, recall, revoke or rescind the SDOA 2) WON the operative fact doctrine is applicable in this case Held: 1) YES. • Under Sec. 31 of RA 6657, the authority to approve the plan for stock distribution of the corporate landowner belongs to PARC. • However, PARC also has the power to revoke the SDP which it previously approved. • Such power or authority is deemed possessed by PARC under the principle of necessary implication. • Every statute is understood, by implication, to contain all such provisions as may be necessary to effectuate its object and purpose, or to make effective rights, powers, privileges or jurisdiction which it grants, including all such collateral and subsidiary •

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consequences as may be fairly and logically inferred from it terms. Following the doctrine of necessary implication, it may be stated that the conferment of express power to approve a plan for stock distribution of the agricultural land of corporate owners necessarily includes the power to revoke or recall the approval of the plan. A law authorizing interference, when appropriate, in the contractual relations between or among parties is deemed read into the contract and its implementation cannot successfully be resisted by force of the non-impairment guarantee. The non-impairment protection is applicable only to laws that derogate prior acts or contracts by enlarging, abridging or in any manner changing intention of the parties. Necessarily, the constitutional proscription would not apply to laws already in effect at the time of contract execution. The prohibition against impairment of the obligation of contracts is aligned with the

general principle that laws newly enacted have only a prospective operation, and cannot affect acts or contracts already perfected. • However, as to laws already in existence, their provisions are read into contracts and deemed a part thereof. 2) YES. • The non-impairment clause under Sec. 10, Art. II is limited in application to laws about to be enacted that would in any way derogate from existing acts or contracts by enlarging, abridging or in any manner changing the intention of the parties thereto. • The “operative fact” doctrine realizes that, in declaring a law or executive action null and void, or, by extension, no longer without force and effect, undue harshness and resulting unfairness must be avoided. Page | 4 PALS BAR OPS PILIPINAS 2016

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Rights might have accrued in favor of natural or juridical persons and obligations justly incurred in the meantime. The actual existence of a statute or executive act is, prior to such a determination, an operative fact and may have consequences which cannot justly be ignored. Prior to the declaration of nullity such challenged legislative to executive act must have been in so force hadthe to judiciary, be complied with. This is untiland after in an appropriate case, declares its invalidity. Parties may have acted under it and may have changed their positions. What could be more fitting than that in a subsequent litigation regard be had to what has been done while such legislative or executive act was in operation and presumed to be valid in all respects. Prior to its being nullified, its existence as a fact must be reckoned with. That the operative fact doctrine squarely applies to executive acts —in this case, the approval by PARC of the HLI proposal for stock distribution—is well-settled in our jurisprudence. Considering that more than two decades had passed since the PARC’s approval of the HLI’s SDP, in conjunction with numerous activities performed in good faith by HLI, and the reliance by the FWBs on the legality and validity of the PARC-approved SDP, perforce, certain rights of the parties, more particularly the FWBs, have to be respected pursuant to the application in a general way of the operative fact doctrine.

BAYAN MUNA, as represented by Rep. SATUR OCAMPO, Rep. CRISPIN BELTRAN, and Rep. LIZA MAZA v. ALBERTO ROMULO, in his capacity as Executive Secretary and BLAS F. OPLE, in his capacity as Secretary of Foreign Affairs

G.R. No. 159618; February 1, 2011 Facts:

1. On May 9, 2003, Ambassador Francis J. Ricciardone sent US Embassy Note Np. 0470 to the Department of Foreign Affairs (DFA) proposing the terms of the non-surrender bilateral agreement between the USA and the RP. 2. The Agreement provides that the current or former Government officials, employees, or military personnel or nationals of one Party present in the territory of the other shall not, absent the express consent of that Party, be surrendered or transferred by any means to any international tribunal, or to any other entity or third country, or expelled to a third country, for the purpose of surrender to or transfer to any international tribunal unless such tribunal has been established by the UN Security Council. 3. Via Exchange of Notes dated May 13, 2003, the RP, represented by DFA Secretary Ople, agreed with and accepted the US proposals embodied under the US Embassy Note adverted to and put in effect the Agreement with the US government. 4. Bayan Muna imputes grave abuse of discretion to respondents in concluding and ratifying the Agreement and prays that it be struck down as constitutional, or at least declared as without force and effect. Issues:

1. Whether or not the RP-US Non-Surrender was contracted validly 2. Whether the Agreement is valid, binding and effective without the concurrence by at least two-thirds of all the members of the Senate Page | 5 PALS BAR OPS PILIPINAS 2016

Held: 1. Yes. According to the doctrine of incorporation, the Philippines adopts the generally accepted principles of international law and international jurisprudence as part of the law of the land and adheres thecategory policy of cooperation, and amity with all nations. An exchange accepted of notes falls intotothe ofpeace, inter-governmental agreements, which is an internationally form of international agreement. The notes exchanged, be it viewed as the Non-Surrender Agreement itself, or as an integral instrument of acceptance or as consent to be bound is a recognized mode of concluding a legally binding international written contract among nations. 2. Yes. There are no hard and fast rules on the propriety of entering, on a given subject, into a treaty or an executive agreement as an instrument of international relations. The Executive exercises the right to enter into binding agreements without the necessity of subsequent Congressional approval has been confirmed by long usage. An act of the executive branch with a foreign government must be afforded great respect. The authority of the President to enter into executive agreements without the concurrence of the Legislature has been recognized in Philippine jurisprudence. This is in consonance with the inviolable doctrine of separation of powers. Absent any clear contravention of the law, courts should exercise utmost caution in declaring any executive agreement invalid.

ANUNCIACION VDA. DE OUANO, MARIO P. OUANO, LETICIA OUANO ARNAIZ, and CIELO OUANO MARTINEZ v. THE REPUBLIC OF THE PHILIPPINES, THE MACTAN-CEBU INTERNATIONAL AIRPORT AUTHORITY, and THE REGISTER OF DEEDS FOR THE CITY OF CEBU; MACTAN-CEBU INTERNATIONAL AIRPORT AUTHORITY (MCIAA) V. RICARDO L. INOCIAN, in his personal capacity and as Attorney-in-Fact of OLYMPIA E. ESTEVES, EMILIA E. BACALLA, RESTITUTA E. MONTANA, and RAUL L. INOCIAN; and ALETHA SUICO MAGAT, in her personal capacity and as Attorney-in-Fact of PHILIP M. SUICO, DORIS S. DELA CRUZ, JAMES M. SUICO, EDWARD M. SUICO, ROSELYN SUICO-LAWSIN, REX M. SUICO, KHARLA SUICO-GUTIERREZ, ALBERT CHIONGBIAN, and JOHNNY CHAN

G.R. No. 168770 and G.R. No. 168812; February 9, 2011 Facts:

1. The case is a consolidation of two petitions with the issue of the right of the former owners of lots acquired for the expansion of the Lahug Airport in Cebu City to repurchase or secure reconveyance of their respective properties. The repurchase was based on the assurance of the government negotiating team that they could repurchase their respective lands should the Lahug Airport expansion project do not push through or once the Lahug Airport closes or its operations transferred to Mactan-Cebu Airport. 2. In 1991, Lahug Airport completely ceased operations, Mactan Airport having opened to accommodate incoming and outgoing commercial flights. This prompted the former lot owners to demand from the government that they be allowed to exercise their promised right to repurchase. However, their demands were not granted.

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Issue:

Whether or not the abandonment of the public use for which the subject properties were expropriated entitles the Ouanos and Inoncian to reacquire them

Held:

Yes. If the genuine public necessity, the very reason or condition as it were allowing, at the first instance, the expropriation of a private land ceases or disappears, then there is no more cogent point for the government’s retention of the expropriated land. The government cannot keep the property it expropriated in any manner it pleases and, in the process, dishonor the judgment of expropriation. Equity and justice demand the reconveyance by MCIAA of the litigated lands in question to the Ouanos and Inocians. Justice and fair play also dictate that the Ouanos and Inocian return to MCIAA what they received as just compensation for the expropriation of their respective properties plus legal interest to be computed from default, which in this case should run from the time MCIAA complies with the reconveyance obligation. They must likewise pay MCIAA the necessary expenses it might have incurred in sustaining their respective lots and the monetary value of its services in managing the lots in question to the extent that they, as private owners, were benefited thereby.

Francisco v. Toll Regulatory Board [G.R. No. 166910 – October 19, 2010)

Facts: • In 1977, Pres. Marcos issued P.D. 1112, authorizing the establishment of toll facilities on

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public improvements. It acknowledged the huge financial requirements and the need to tap into the resources of the private sector to implement the program. The TRB was given the power to enter into contracts for the construction, maintenance, and operation of tollways, grant authority to operate a toll facility, and issue the necessary Toll Operation Certificate (TOC). PD 1112 also allowed the collection of toll fees for the use of certain public improvements, allowing a reasonable rate of ROI. P.D.1113 was also issued, granting the Philippine National Construction Corporation (PNCC) a franchise to construct toll facilities with a right to collect fees as the TRB may fix. TRB and PNCC signed an agreement for the operation of the North Luzon and South Luzon expressway. PD 1894 was then issued further granting the PNCC a franchise over the Metro Manila Expressway (MMEX) and the expanded delineated NLEX and SLEX. As stated in the previous P.D.s, PNCC may sell its franchise upon the President’s approval.

Then came the 1987 Constitution with its franchise provision. In 1994, the DPWH together with other private entities executed a MOU to open the door for entry of private capital in the Subic and Clark extension projects. PNCC entered into financial and technical JVAs through Supplemental Toll Operation Agreements (STOA) with private entities for the toll operation of its franchised areas. • Petitioners assail the constitutionality of Sections 3 (a) and (d) of P.D. 1112 in relation to Section 8 (b) of P.D. 1894 insofar as they vested the TRB, on one hand, toll operation awarding power while, on the other hand, granting it also the power to issue, modify and promulgate toll rate charges. Petitioners allege that the TRB, cannot be an awarding party of a TOA and, at the same time, be the regulator of the toll way industry and and ajudicator of rate exactions disputes. Page | 7 PALS BAR OPS PILIPINAS 2016

Issue: WoN the TRB has the power to grant public utility franchise (Toll Operation Agreements). Held: YES, the TRB may issue toll operation agreements. •

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A franchise basically a legislative grant of a special privilege to person, which includes not isonly authorizations issuing directly from Congress in athe form of statute, but also those granted by administrative agencies to which the power to grant franchise has been delegated by Congress. There is nothing in the Constitution indicating the necessity of a congressional franchise before each and every public utility may operate. That the Constitution provides that the issuance of a franchise, certificate or other form of authorization for the operation of a public utility shall be subject to amendment, alteration or repeal by Congress does not necessarily imply that only Congress has the power to grant such authorization. Under the 1987 Constitution, Congress has an explicit authority to grant a public utility franchise. However, it may validly delegate its legislative authority, under the power of subordinate legislation, to issue franchises of certain public utilities to some administrative agencies. By explicit provisions of the subject PDs, the TRB was given power to grant administrative franchise for toll facility projects. The only limitations provided for by Article 12, Section 11 of the Constitution are as follows: (a) the grant shall be made only in favor of qualified Filipino citizens or corporations; (b) Congress can impair the obligation of franchises, as contracts; and (c) no such authorization shall be exclusive or exceed fifty years.

RUBRICO v. MACAPAGAL-ARROYO [GR. No. 183871; February 18, 2010]

Facts: • On April 3, 2007, armed men belonging to the 301st Air Intelligence and Security

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Squadron (“AISS”) based in Fernando Air Base in Lipa City abducted Lourdes D. Rubrico (Lourdes) and detained her at the air base without charges. Following a week of relentless interrogation—conducted alternately by hooded individuals—and what amounts to verbal abuse and mental harassment, Lourdes was released but only after being made to sign a statement that she would be a military asset. After she was released, the harassment still continued. Her daughters were also constrained to leave their house because of the presence of men watching them. • Lourdes has filed with the Office of the Ombudsman a criminal complaint for kidnapping and arbitrary detention and administrative complaint for gross abuse of authority and grave misconduct against Capt. Angelo Cuaresma (Cuaresma), Ruben Alfaro (Alfaro), Jimmy Santana (Santana) and a certain Jonathan, c/o Headquarters 301st AISS, Fernando Air Base and Maj. Sy/Reyes. o But nothing has happened and the threats and harassment incidents have been reported to the police but nothing eventful resulted from their investigations. Karapatan conducted an investigation on the incidents. The investigation would indicate that men belonging to the Armed Forces of the Philippines (AFP) led the abduction of Loudes. The petition prayed that a writ of amparo issue, ordering the individual respondents to desist from performing any threatening act against the security of the petitioners and for the Office of the Ombudsman (OMB) to immediately file an information for kidnapping qualified with the aggravating circumstance of gender of the offended party. The respondents, President GMA, the AFP and PNP officers denied the allegations.

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Issue/s:

WON the CA committed reversible error in dismissing the petition and dropping President Gloria Macapagal Arroyo as party respondent? Held: NO. The president is immune from suit and may not be sued during his or her tenure. Settled is the doctrine that the President, during his tenure of office or actual incumbency, may not be sued in any civil or criminal case, and there is no need to provide for it in the Constitution or law. It will degrade the dignity of the high office of the President, the Head of State, if he can be dragged into court litigations while serving as such. The Court also affirmed the dismissal of the amparo case against other respondents for failure of the petition to allege ultimate facts as to make out a case against that body for the enforced disappearance of Lourdes and the threats and harassment that followed.

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