SECOND DIVISION

[G.R. No. 153660. June 10, 2003]

PRUDENCIO BANTOLINO, NESTOR ROMERO, NILO ESPINA, EDDIE LADICA, ARMAN QUELING, ROLANDO NIETO, RICARDO BARTOLOME, ELUVER GARCIA, EDUARDO GARCIA and NELSON MANALASTAS, petitioners, vs. COCA-COLA BOTTLERS PHILS., INC., respondent.

D E C I S I O N

BELLOSILLO, J.:

This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court assailing the Decision of the Court of Appeals

[1] dated 21 December 2001 which

affirmed with modification the decision of the National Labor Relations Commission promulgated 30 March 2001.

[2]

On 15 February 1995 sixty-two (62) employees of respondent Coca-Cola Bottlers, Inc., and its officers, Lipercon Services, Inc., Peoples Specialist Services, Inc., and Interim Services, Inc., filed a complaint against respondents for unfair labor practice through illegal dismissal, violation of their security of tenure and the perpetuation of the Cabo System. They thus prayed for reinstatement with full back wages, and the declaration of their regular employment status.

For failure to prosecute as they failed to either attend the scheduled mandatory conferences or submit their respective affidavits, the claims of fifty-two (52) complainant-employees were dismissed. Thereafter, Labor Arbiter Jose De Vera conducted clarificatory hearings to elicit information from the ten (10) remaining complainants (petitioners herein) relative to their alleged employment with respondent firm.

In substance, the complainants averred that in the performance of their duties as route helpers, bottle segregators, and others, they were employees of respondent Coca-Cola Bottlers, Inc. They further maintained that when respondent company replaced them and prevented them from entering the company premises, they were deemed to have been illegally dismissed.

In lieu of a position paper, respondent company filed a motion to dismiss complaint for lack of jurisdiction and cause of action, there being no employer-employee relationship between complainants and Coca-Cola Bottlers, Inc., and that respondents Lipercon Services, Peoples Specialist Services and Interim Services being bona fideindependent contractors, were the real employers of the complainants.

[3] As regards the corporate officers, respondent insisted that they could

not be faulted and be held liable for damages as they only acted in their official capacities while performing their respective duties.

On 29 May 1998 Labor Arbiter Jose De Vera rendered a decision ordering respondent company to reinstate complainants to their former positions with all the rights, privileges and benefits due regular employees, and to pay their full back wages which, with the exception of Prudencio Bantolino whose back wages must be computed upon proof of his dismissal as of 31 May 1998, already amounted to an aggregate of P1,810,244.00.

[4]

In finding for the complainants, the Labor Arbiter ruled that in contrast with the negative declarations of respondent companys witnesses who, as district sales supervisors of respondent company denied knowing the complainants personally, the testimonies of the complainants were more credible as they sufficiently supplied every detail of their employment, specifically identifying who their salesmen/drivers were, their places of assignment, aside from their dates of engagement and dismissal.

On appeal, the NLRC sustained the finding of the Labor Arbiter that there was indeed an employer-employee relationship between the complainants and respondent company when it affirmed in toto the latters decision.

In a resolution dated 17 July 2001 the NLRC subsequently denied for lack of merit respondents motion for consideration.

Respondent Coca-Cola Bottlers appealed to the Court of Appeals which, although affirming the finding of the NLRC that an employer-employee relationship existed between the contending parties, nonetheless agreed with respondent that the affidavits of some of the complainants, namely, Prudencio Bantolino, Nestor Romero, Nilo Espina, Ricardo Bartolome, Eluver Garcia, Eduardo Garcia and Nelson Manalastas, should not have been given probative value for their failure to affirm the contents thereof and to undergo cross-examination. As a consequence, the appellate court dismissed their complaints for lack of sufficient evidence. In the same Decision however, complainants Eddie Ladica, Arman Queling and Rolando Nieto were declared regular employees since they were the only ones subjected to cross-examination.

[5] Thus -

x x x (T)he labor arbiter conducted clarificatory hearings to ferret out the truth between the

opposing claims of the parties thereto. He did not submit the case based on position papers and

their accompanying documentary evidence as a full-blown trial was imperative to establish the

parties claims. As their allegations were poles apart, it was necessary to give them ample

opportunity to rebut each others statements through cross-examination. In fact, private

respondents Ladica, Quelling and Nieto were subjected to rigid cross-examination by

petitioners counsel. However, the testimonies of private respondents Romero, Espina, and

Bantolino were not subjected to cross-examination, as should have been the case, and no

explanation was offered by them or by the labor arbiter as to why this was dispensed with.

Since they were represented by counsel, the latter should have taken steps so as not to

squander their testimonies. But nothing was done by their counsel to that effect.[6]

Petitioners now pray for relief from the adverse Decision of the Court of Appeals; that, instead, the favorable judgment of the NLRC be reinstated.

In essence, petitioners argue that the Court of Appeals should not have given weight to respondents claim of failure to cross-examine them. They insist that, unlike regular courts, labor cases are decided based merely on the parties position papers and affidavits in support of their allegations and subsequent pleadings that may be

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filed thereto. As such, according to petitioners, the Rules of Court should not be strictly applied in this case specifically by putting them on the witness stand to be cross-examined because the NLRC has its own rules of procedure which were applied by the Labor Arbiter in coming up with a decision in their favor.

In its disavowal of liability, respondent commented that since the other alleged affiants were not presented in court to affirm their statements, much less to be cross-examined, their affidavits should, as the Court of Appeals rightly held, be stricken off the records for being self-serving, hearsay and inadmissible in evidence. With respect to Nestor Romero, respondent points out that he should not have been impleaded in the instant petition since he already voluntarily executed a Compromise Agreement, Waiver and Quitclaim in consideration of P450,000.00. Finally, respondent argues

that the instant petition should be dismissed in view of the failure of petitioners[7]

to sign the petition as well as the verification and certification of non-forum shopping, in clear violation of the principle laid down in Loquias v. Office of the Ombudsman.

[8]

The crux of the controversy revolves around the propriety of giving evidentiary value to the affidavits despite the failure of the affiants to affirm their contents and undergo the test of cross-examination.

The petition is impressed with merit. The issue confronting the Court is not without precedent in jurisprudence. The oft-cited case of Rabago v. NLRC

[9] squarely

grapples a similar challenge involving the propriety of the use of affidavits without the presentation of affiants for cross-examination. In that case, we held that the argument that the affidavit is hearsay because the affiants were not presented for cross-examination is not persuasive because the rules of evidence are not strictly observed in proceedings before administrative bodies like the NLRC where decisions may be reached on the basis of position papers only.

In Rase v. NLRC,[10]

this Court likewise sidelined a similar challenge when it ruled that it was not necessary for the affiants to appear and testify and be cross-examined by counsel for the adverse party. To require otherwise would be to negate the rationale and purpose of the summary nature of the proceedings mandated by the Rules and to make mandatory the application of the technical rules of evidence.

Southern Cotabato Dev. and Construction Co. v. NLRC[11]

succinctly states that

under Art. 221 of the Labor Code, the rules of evidence prevailing in courts of law do not control proceedings before the Labor Arbiter and the NLRC. Further, it notes that the Labor Arbiter and the NLRC are authorized to adopt reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law and procedure, all in the interest of due process. We find no compelling reason to deviate therefrom.

To reiterate, administrative bodies like the NLRC are not bound by the technical niceties of law and procedure and the rules obtaining in courts of law. Indeed, the Revised Rules of Court and prevailing jurisprudence may be given only stringent application, i.e., by analogy or in a suppletory character and effect. The submission by respondent, citing People v. Sorrel,

[12] that an affidavit not testified to in a trial, is

mere hearsay evidence and has no real evidentiary value, cannot find relevance in the present case considering that a criminal prosecution requires a quantum of evidence different from that of an administrative proceeding. Under the Rules of the Commission, the Labor Arbiter is given the discretion to determine the necessity of a formal trial or hearing. Hence, trial-type hearings are not even required as the cases

may be decided based on verified position papers, with supporting documents and their affidavits.

As to whether petitioner Nestor Romero should be properly impleaded in the instant case, we only need to follow the doctrinal guidance set by Periquet v. NLRC

[13] which outlines the parameters for valid compromise agreements, waivers

and quitclaims -

Not all waivers and quitclaims are invalid as against public policy. If the agreement was

voluntarily entered into and represents a reasonable settlement, it is binding on the parties and

may not later be disowned simply because of a change of mind. It is only where there is clear

proof that the waiver was wangled from an unsuspecting or gullible person, or the terms of

settlement are unconscionable on its face, that the law will step in to annul the questionable

transaction. But where it is shown that the person making the waiver did so voluntarily, with

full understanding of what he was doing, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as a valid and binding undertaking.

In closely examining the subject agreements, we find that on their face theCompromise Agreement

[14] and Release, Waiver and Quitclaim

[15] are devoid of

any palpable inequity as the terms of settlement therein are fair and just. Neither can we glean from the records any attempt by the parties to renege on their contractual agreements, or to disavow or disown their due execution. Consequently, the same must be recognized as valid and binding transactions and, accordingly, the instant case should be dismissed and finally terminated insofar as concerns petitioner Nestor Romero.

We cannot likewise accommodate respondents contention that the failure of all the petitioners to sign the petition as well as the Verification and Certification of Non-Forum Shopping in contravention of Sec. 5, Rule 7, of the Rules of Court will cause the dismissal of the present appeal. While the Loquias case requires the strict

observance of the Rules, it however provides an escape hatch for the transgressor to avoid the harsh consequences of non-observance. Thus -

x x x x We find that substantial compliance will not suffice in a matter involving strict

observance of the rules. The attestation contained in the certification on non-forum shopping

requires personal knowledge by the party who executed the same. Petitioners must show

reasonable cause for failure to personally sign the certification. Utter disregard of the rules

cannot justly be rationalized by harking on the policy of liberal construction (underscoring

supplied).

In their Ex Parte Motion to Litigate as Pauper Litigants, petitioners made a request for a fifteen (15)-day extension, i.e., from 24 April 2002 to 8 May 2002, within which to file their petition for review in view of the absence of a counsel to represent them.

[16] The records also reveal that it was only on 10 July 2002 that Atty. Arnold

Cacho, through the UST Legal Aid Clinic, made his formal entry of appearance as counsel for herein petitioners. Clearly, at the time the instant petition was filed on 7 May 2002 petitioners were not yet represented by counsel. Surely, petitioners who are non-lawyers could not be faulted for the procedural lapse since they could not be expected to be conversant with the nuances of the law, much less knowledgeable with the esoteric technicalities of procedure. For this reason alone, the procedural

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infirmity in the filing of the present petition may be overlooked and should not be taken against petitioners.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals

is REVERSED and SET ASIDE and the decision of the NLRC dated 30 March 2001 which affirmed in toto the decision of the Labor Arbiter dated 29 May 1998 ordering respondent Coca-Cola Bottlers Phils., Inc., to reinstate Prudencio Bantolino, Nilo Espina, Eddie Ladica, Arman Queling, Rolando Nieto, Ricardo Bartolome, Eluver Garcia, Eduardo Garcia and Nelson Manalastas to their former positions as regular employees, and to pay them their full back wages, with the exception of Prudencio Bantolino whose back wages are yet to be computed upon proof of his dismissal, is REINSTATED, with the MODIFICATION that herein petition is DENIED insofar as it concerns Nestor Romero who entered into a valid and binding Compromise Agreement and Release, Waiver and Quitclaim with respondent company.

SO ORDERED.

Quisumbing, Austria-Martinez, and Callejo, Sr., JJ., concur.

G.R. No. 110571 March 10, 1994

FIRST LEPANTO CERAMICS, INC., petitioner,

vs. THE COURT OF APPEALS and MARIWASA MANUFACTURING, INC., respondents.

Castillo, Laman, Tan & Pantaleon for petitioner.

De Borja, Medialdea, Ata, Bello, Guevarra & Serapio for private respondent.

NOCON, J.:

Brought to fore in this petition for certiorari and prohibition with application for

preliminary injunction is the novel question of where and in what manner appeals from decisions of the Board of Investments (BOI) should be filed. A thorough scrutiny of the conflicting provisions of Batas Pambansa Bilang 129, otherwise known as the "Judiciary Reorganization Act of 1980," Executive Order No. 226, also known as the Omnibus Investments Code of 1987 and Supreme Court Circular No. 1-91 is, thus, called for.

Briefly, this question of law arose when BOI, in its decision dated December 10, 1992 in BOI Case No. 92-005 granted petitioner First Lepanto Ceramics, Inc.'s application to amend its BOI certificate of registration by changing the scope of its registered product from "glazed floor tiles" to "ceramic tiles." Eventually, oppositor Mariwasa filed a motion for reconsideration of the said BOI decision while oppositor Fil-Hispano Ceramics, Inc. did not move to reconsider the same nor appeal therefrom. Soon rebuffed in its bid for reconsideration, Mariwasa filed a petition for review with respondent Court of Appeals pursuant to Circular 1-91.

Acting on the petition, respondent court required the BOI and petitioner to comment on Mariwasa's petition and to show cause why no injunction should issue. On February 17, 1993, respondent court temporarily restrained the BOI from implementing its decision. This temporary restraining order lapsed by its own terms on March 9, 1993, twenty (20) days after its issuance, without respondent court issuing any preliminary injunction.

On February 24, 1993, petitioner filed a "Motion to Dismiss Petition and to Lift Restraining Order" on the ground that respondent court has no appellate jurisdiction over BOI Case No. 92-005, the same being exclusively vested with the Supreme Court pursuant to Article 82 of the Omnibus Investments Code of 1987.

On May 25, 1993, respondent court denied petitioner's motion to dismiss, the dispositive portion of which reads as follows:

WHEREFORE, private respondent's motion to dismiss the petition is hereby DENIED, for lack of merit.

Private respondent is hereby given an inextendible period of ten (10) days from receipt hereof within which to file its comment to the petition.

1

Upon receipt of a copy of the above resolution on June 4, 1993, petitioner decided not to file any motion for reconsideration as the question involved is essentially legal in nature and immediately filed a petition for certiorariand prohibition before this Court.

Petitioner posits the view that respondent court acted without or in excess of its jurisdiction in issuing the questioned resolution of May 25, 1993, for the following reasons:

I. Respondent court has no jurisdiction to entertain Mariwasa's appeal from the BOI's decision in BOI Case No. 92-005, which has become final.

II. The appellate jurisdiction conferred by statute upon this Honorable Court cannot be amended or superseded by Circular No. 1-91.

2

Petitioner then concludes that:

III. Mariwasa has lost it right to appeal . . . in this case. 3

Petitioner argues that the Judiciary Reorganization Act of 1980 or Batas Pambansa Bilang 129 and Circular 1-91, "Prescribing the Rules Governing Appeals to the Court of Appeals from a Final Order or Decision of the Court of Tax Appeals and Quasi-Judicial Agencies" cannot be the basis of Mariwasa's appeal to respondent court because the procedure for appeal laid down therein runs contrary to Article 82 of E.O.

226, which provides that appeals from decisions or orders of the BOI shall be filed directly with this Court, to wit:

Judicial relief. All orders or decisions of the Board (of Investments) in cases involving the provisions of this Code shall immediately be executory. No appeal from the order or decision of the Board by the party adversely affected shall stay such an order or decision; Provided, that all appeals shall be filed directly with the Supreme Court within thirty (30) days from receipt of the order or decision.

On the other hand, Mariwasa maintains that whatever "obvious inconsistency" or "irreconcilable repugnancy" there may have been between B.P. 129 and Article 82 of E.O. 226 on the question of venue for appeal has already been resolved by Circular 1-91 of the Supreme Court, which was promulgated on February 27, 1991 or four (4) years after E.O. 226 was enacted.

Sections 1, 2 and 3 of Circular 1-91, is herein quoted below:

1. Scope. These rules shall apply to appeals from final orders or decisions of the Court of Tax Appeals. They shall also apply to appeals from final orders or decisions of any quasi-judicial agency from which an appeal is now allowed by statute to the Court of Appeals or the Supreme Court. Among these agencies are the Securities and Exchange Commission, Land Registration Authority, Social Security Commission, Civil Aeronautics Board, Bureau of Patents, Trademarks and Technology Transfer, National Electrification Administration, Energy Regulatory Board, National Telecommunications Commission, Secretary of Agrarian Reform and Special Agrarian Courts under RA 6657, Government Service Insurance System, Employees Compensation Commission, Agricultural Inventions Board, Insurance Commission and Philippine Atomic Energy Commission.

2. Cases not covered. These rules shall not apply to decisions and interlocutory orders of the National Labor Relations Commission or the Secretary of Labor and Employment under the Labor Code of the Philippines, the Central Board of Assessment Appeals, and other quasi-judicial agencies from which no appeal to the courts is prescribed or allowed by statute.

3. Who may appeal and where to appeal. The appeal of a party affected by a final order, decision, or judgment of the Court of Tax Appeals or of a quasi-judicial agency shall be taken to the Court of Appeals within the period and in the manner herein provided, whether the appeal involves questions of fact or of law or mixed questions of fact and law. From final judgments or decisions of the Court of Appeals, the aggrieved party may appeal by certiorari to the Supreme Court as provided in Rule 45 of the Rules of Court.

It may be called that Section 9(3) of B.P. 129 vests appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of quasi-judicial agencies on the Court of Appeals, to wit:

(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders, awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or commissions, except those falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the provisions of this Act, and of subparagraph (1) of the third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948.

The Intermediate Appellate Court shall have the power to try cases and conduct hearings, receive evidence and perform any and all acts necessary to resolve factual issues raised in cases falling within its original and appellate jurisdiction, including the power to grant and conduct new trials or further proceedings.

These provisions shall not apply to decisions and interlocutory orders issued under the Labor Code of the Philippines and by the Central Board of Assessment Appeals.

Clearly evident in the aforequoted provision of B.P. 129 is the laudable objective of providing a uniform procedure of appeal from decisions of all quasi-judicial agencies for the benefit of the bench and the bar. Equally laudable is the twin objective of B.P. 129 of unclogging the docket of this Court to enable it to attend to more important tasks, which in the words of Dean Vicente G. Sinco, as quoted in our decision in Conde v. Intermediate Appellate Court

4is "less concerned with the decisions of

cases that begin and end with the transient rights and obligations of particular individuals but is more intertwined with the direction of national policies, momentous economic and social problems, the delimitation of governmental authority and its impact upon fundamental rights.

In Development Bank of the Philippines vs. Court of Appeals, 5

this Court noted that

B.P. 129 did not deal only with "changes in the rules on procedures" and that not only was the Court of Appeals reorganized, but its jurisdiction and powers were also broadened by Section 9 thereof. Explaining the changes, this Court said:

. . . Its original jurisdiction to issue writs of mandamus, prohibition, certiorari and habeas corpus, which theretofore could be exercised only in aid of its appellate jurisdiction, was expanded by (1) extending it so as to include the writ of quo warranto, and also (2) empowering it to issue all said extraordinary writs "whether or not in aid of its appellate jurisdiction." Its appellate jurisdiction was also extended to cover not only final judgments of Regional Trial Courts, but also "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, the provisions of this Act, and of sub-paragraph (1) of the third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948," it being noteworthy in this connection that the text of the law is broad and comprehensive, and the explicitly stated exceptions have no reference whatever to the Court of Tax Appeals. Indeed, the intention to expand the original and appellate jurisdiction of the Court of Appeals over quasi-judicial agencies, instrumentalities, boards, or commissions, is further stressed by the last paragraph of Section 9 which excludes from its provisions, only the "decisions and interlocutory orders issued under the Labor Code of the Philippines and by the Central Board of Assessment Appeals."

6

However, it cannot be denied that the lawmaking system of the country is far from perfect. During the transitional period after the country emerged from the Marcos regime, the lawmaking power was lodged on the Executive Department. The obvious lack of deliberation in the drafting of our laws could perhaps explain the deviation of some of our laws from the goal of uniform procedure which B.P. 129 sought to promote.

In exempli gratia, Executive Order No. 226 or the Omnibus Investments Code of 1987 provides that all appeals shall be filed directly with the Supreme Court within thirty (30) days from receipt of the order or decision.

Noteworthy is the fact that presently, the Supreme Court entertains ordinary appeals only from decisions of the Regional Trial Courts in criminal cases where the penalty imposed is reclusion perpetua or higher. Judgments of regional trial courts may be appealed to the Supreme Court only by petition for review on certiorari within fifteen (15) days from notice of judgment in accordance with Rule 45 of the Rules of Court in relation to Section 17 of the Judiciary Act of 1948, as amended, this being the clear intendment of the provision of the Interim Rules that "(a)ppeals to the Supreme Court shall be taken by petition for certiorari which shall be governed by Rule 45 of the Rules of Court." Thus, the right of appeal provided in E.O. 226 within thirty (30) days from receipt of the order or decision is clearly not in consonance with the present procedure before this Court. Only decisions, orders or rulings of a Constitutional Commission (Civil Service Commission, Commission on Elections or Commission on Audit), may be brought to the Supreme Court on original petitions for certiorari under Rule 65 by the aggrieved party within thirty (30) days form receipt of a copy thereof.

7

Under this contextual backdrop, this Court, pursuant to its Constitutional power under Section 5(5), Article VIII of the 1987 Constitution to promulgate rules concerning pleading, practice and procedure in all courts, and by way of implementation of B.P. 129, issued Circular 1-91 prescribing the rules governing appeals to the Court of Appeals from final orders or decisions of the Court of Tax Appeals and quasi-judicial agencies to eliminate unnecessary contradictions and confusing rules of procedure.

Contrary to petitioner's contention, although a circular is not strictly a statute or law, it has, however, the force and effect of law according to settled jurisprudence.

8 In Inciong v. de Guia,

9 a circular of this Court was treated as law. In

adopting the recommendation of the Investigating Judge to impose a sanction on a

judge who violated Circular No. 7 of this Court dated September 23, 1974, as amended by Circular No. 3 dated April 24, 1975 and Circular No. 20 dated October 4, 1979, requiring raffling of cases, this Court quoted the ratiocination of the Investigating Judge, brushing aside the contention of respondent judge that assigning cases instead of raffling is a common practice and holding that respondent could not go against the circular of this Court until it is repealed or otherwise modified, as "(L)aws are repealed only by subsequent ones, and their violation or non-observance shall not be excused by disuse, or customs or practice to the contrary."

10

The argument that Article 82 of E.O. 226 cannot be validly repealed by Circular 1-91 because the former grants a substantive right which, under the Constitution cannot be modified, diminished or increased by this Court in the exercise of its rule-making powers is not entirely defensible as it seems. Respondent correctly argued that Article 82 of E.O. 226 grants the right of appeal from decisions or final orders of the BOI and in granting such right, it also provided where and in what manner such appeal can be brought. These latter portions simply deal with procedural aspects which this Court has the power to regulate by virtue of its constitutional rule-making powers.

The case of Bustos v. Lucero 11

distinguished between rights created by a substantive

law and those arising from procedural law:

Substantive law creates substantive rights . . . . Substantive rights is a term which includes those rights which one enjoys under the legal system prior to the disturbance of normal relations (60 C.J., 980). Substantive law is that part of the law which creates, defines and regulates rights, or which regulates rights and duties which give rise to a cause of action, as oppossed to adjective or remedial law, which prescribes the method of enforcing rights or obtains a redress for their invasion.

12

Indeed, the question of where and in what manner appeals from decisions of the BOI should be brought pertains only to procedure or the method of enforcing the substantive right to appeal granted by E.O. 226. In other words, the right to appeal from decisions or final orders of the BOI under E.O. 226 remains and continues to be respected. Circular 1-91 simply transferred the venue of appeals from decisions of this agency to respondent Court of Appeals and provided a different period of appeal, i.e., fifteen (15) days from notice. It did not make an incursion into the substantive right to appeal.

The fact that BOI is not expressly included in the list of quasi-judicial agencies found in the third sentence of Section 1 of Circular 1-91 does not mean that said circular does not apply to appeals from final orders or decision of the BOI. The second sentence of Section 1 thereof expressly states that "(T)hey shall also apply to appeals from final orders or decisions of any quasi-judicial agency from which an appeal is now allowed by statute to the Court of Appeals or the Supreme Court." E.O. 266 is one such statute. Besides, the enumeration is preceded by the words "(A)mong these agencies are . . . ," strongly implying that there are other quasi-judicial agencies which are covered by the Circular but which have not been expressly listed therein. More importantly, BOI does not fall within the purview of the exclusions listed in Section 2

of the circular. Only the following final decisions and interlocutory orders are expressly excluded from the circular, namely, those of: (1) the National Labor Relations Commission; (2) the Secretary of Labor and Employment; (3) the Central Board of Assessment Appeals and (4) other quasi-judicial agencies from which no appeal to the courts is prescribed or allowed by statute. Since in DBP v. CA

13 we

upheld the appellate jurisdiction of the Court of Appeals over the Court of Tax Appeals despite the fact that the same is not among the agencies reorganized by B.P. 129, on the ground that B.P. 129 is broad and comprehensive, there is no reason why BOI should be excluded from Circular 1-91, which is but implementary of said law.

Clearly, Circular 1-91 effectively repealed or superseded Article 82 of E.O. 226 insofar as the manner and method of enforcing the right to appeal from decisions of the BOI are concerned. Appeals from decisions of the BOI, which by statute was previously allowed to be filed directly with the Supreme Court, should now be brought to the Court of Appeals.

WHEREFORE, in view of the foregoing reasons, the instant petition for certiorari and prohibition with application for temporary restraining order and preliminary injunction is hereby DISMISSED for lack of merit. The Temporary Restraining Order issued on July 19, 1993 is hereby LIFTED.

SO ORDERED.

Narvasa, C.J., Padilla, Regalado and Puno, JJ. concur.

G.R. No. 69871 August 24, 1990

ANITA VILLA, petitioner,

vs. MANUEL LAZARO, as Presidential Assistant for Legal Affairs, Office of the President, and the HUMAN SETTLEMENTS REGULATORY COMMISSION, respondents.

Eliseo P. Vencer II for petitioner.

NARVASA, J.:

On January 18, 1980, Anita Villa was granted a building permit to construct a funeral parlor at Santiago Boulevard in Gen. Santos City.

1 The permit was issued by the City

Engineer after the application was "processed by Engineer Dominador Solana of the City Engineer's Office, and on the strength of the Certification of Manuel Sales, City Planning and Development Coordinator that the "project was in consonance with the Land Use Plan of the City and within the full provision of the Zoning Ordinance".

2 With financing obtained from the Development Bank of the Philippines,

Villa commenced construction of the building.

In October of that same year, as the funeral parlor was nearing completion, a suit for injunction was brought against Villa by Dr. Jesus Veneracion, the owner of St. Elizabeth Hospital, standing about 132.36 meters from the funeral parlor.

3 The

complaint sought the perpetual enjoinment of the construction because allegedly violative of the Zoning Ordinance of General Santos City.

4 A status quo order was

issued.

After appropriate proceedings and trial, judgment on the merits was rendered on November 17, 1981, dismissing Veneracion's complaint as well as the counterclaim pleaded by Villa. The Trial Court found that there was afalsified Zoning Ordinance, containing a provision governing funeral parlors, which had been submitted to and ratified by the Ministry of Human Settlements, but that ordinance had never been passed by the Sangguniang Panlungsod and that the genuine Zoning Ordinance of

General Santos City contained no prohibition whatever relative to such parlors' "distance from hospitals, whether public or private".

5 Villa then resumed construction

of her building and completed it. 6

Veneracion did not appeal from this adverse judgment which therefore became final. Instead, he brought the matter up with the Human Settlements Regulatory Commission. He lodged a complaint with that commission praying "that the funeral parlor be relocated because it was near the St. Elizabeth Hospital and Villa failed to secure the necessary locational clearance".

7 The complaint, as will at once be noted,

is substantially the same as that filed by him with the Court of First Instance and dismissed after trial. Furthermore, neither he nor the Commission, as will hereafter be narrated, ever made known this second complaint to Villa until much, much later, after the respondent Commission had rendered several adverse rulings to her.

8

Two months after the rendition of the judgment against Veneracion, or more precisely on January 22, 1982, Villa received a telegram dated January 21 from Commissioner Raymundo R. Dizon of the Human Settlements Regulatory Commission reading as follows:

9

THE HUMAN SETTLEMENT REGULATORY COMMISSION REQUEST TRANSMITTAL OF PROOF OF LOCATIONAL CLEARANCE GRANTED BY THIS OFFICE IMMEDIATELY UPON RECEIPT OF THIS . . NOT LATER THAN 21ST JANUARY 1982 REGARDING YOUR ON GOING CONSTRUCTION OF A FUNERAL PARLOR AT SANTIAGO STREET CORNER NATIONAL HIGHWAY GENERAL SANTOS CITY AN OFFICIAL COMMUNICATION TO THE EFFECT FOLLOWS.

On the same day, January 22, 1982, Villa sent Dizon a reply telegram reading: "LOCATIONAL CLEARANCE BASED ON CERTIFICATION OF CITY PLANNING AND DEVELOPMENT COORDINATOR AND HUMAN SETTLEMENT OFFICER, COPIES MAIL . . ."

10 This she did on January 27,1982; under Registry Receipt No.

1227 (Gen. Santos City Post Office), 11

Villa sent to Dizon

1) the certification dated October 24, 1980 of Josefina E. Alaba (Human Settlements Officer, Gen. Santos City) to the following effect:

12

. . that per scrutiny of the documents presented by Mrs. Anita Villa on her application for a Funeral Parlor and inspection of lot No. 4997 along Santiago Boulevard where the building is to be constructed, the undersigned guarantees that the application passed the criteria of this office for this purpose.

2) and the certification of Manuel O. Sales, City Planning and Development Coordinator, dated December 27, 1979,

13 that:

. . the proposed project (funeral Chapel) of Anita G. Villa, located at Lot No. 4997 along Santiago Boulevard is in consonance with the land Use Plan of the City and within the full provision of the Zoning Ordinance.

On February 8, 1982 Villa received what was evidently the official communication" referred to in Commissioner Dizon's telegram of January 21, 1982, supra, an "Order to Present Proof of Locational Clearance" dated January 20, 1982. Knowing this and "considering also that she . . (had) already sent the (required) locational clearance on January 27, 1982," Villa made no response.

14

No doubt with no little discomfiture Villa received on June 2, 1982 a "Show Cause" Order dated April 28,1982, signed by one Ernesto L. Mendiola in behalf of the Commission, requiring her to show cause why a fine should not be imposed on her or a cease-and-desist order issued against her for her failure to show proof of locational clearance.

15 The order made no reference whatever to the documents she had

already sent by registered mail as early as January 27, 1982. The following day Villa sent a telegram to Commissioner Dizon reading as follows:

16

LOCATIONAL CLEARANCE WAS MAILED THRU REGISTERED MAIL REGISTRY RECEIPT NUMBER 1227 DATED JANUARY 27, 1982, SENDING AGAIN THRU REGISTERED MAIL REGISTRY RECEIPT NO. 6899 JUNE 3, 1982.

On the same day, she also sent to Commissioner Dizon by registered mail (Reg Receipt No. 6899), as indicated in her telegram, the same certifications earlier sent by her also by registered mail (Reg Receipt No. 1227), supra.

If she thought the affair had thus been satisfactorily ended, she was sadly in error, of which she was very shortly made aware. On July 27, 1982, she received an Order of Commissioner Dizon dated June 29, 1982 imposing on her a fine of P10,000.00 and requiring her to cease operations until further orders from his office.

17 The order

made no mention of the documents she had transmitted by registered mail on January 27, 1982 and June 3, 1982, or to her telegrams on the matter. Villa forthwith went to see the Deputized Zoning Administrator of General Santos City, Isidro M. Olmedo. The latter issued to her a "CERTIFICATE OF ZONING COMPLIANCE" No. 0087, dated July 28,1982, inter aliaattesting that the land on which Villa's "proposed commercial building" was located in a vicinity in which the "dominant land uses" were "commercial/institutional/residential," and the project conformed "WITH THE LAND USE PLAN OF THE CITY."

18 This certificate Villa sent on the same day to

Commissioner Dizon by registered mail (Reg. Receipt No. 1365 [Gen. Santos City P.O.]).

19 It is noteworthy that this Certificate No. 0087 is entirely consistent with the

earlier certification dated November 27, 1979 of City Planning & Development Coordinator Sales that Villa's funeral chapel was "in consonance with the Land Use Plan of the City and within the full provision of the Zoning Ordinance," supra,

20 and

that of Human Settlements Officer Alaba dated October 24, 1980, supra 21

that Villa's

"application for a Funeral Parlor . . passed the criteria of this office for this purpose." Villa could perhaps be understandably considered justified in believing, at this time, that the matter had finally been laid to rest.

One can then only imagine her consternation and shock when she was served on November 16, 1982 with a writ of execution signed by Commissioner Dizon under the date of October 19, 1982 in implementation of his Order of June 29, 1982, above mentioned, imposing a fine of P10,000.00 on her. Again, this Order, like the others issuing from respondent Commission, made no advertence whatever to the documents Villa had already sent to respondent Commission by registered mail on January 27, June 29, and July 28, 1982, or her telegrams Be this as it may, she lost no time in moving for reconsideration, by letter dated November 22, 1982 to which she attached copies of the documents she had earlier sent to Commissioner Dizon, viz.: her telegram of January 22, 1982,

22(2) the certification of the City

Planning & Development Coordinator 23

(3) the certification of the Human Settlements Officer

24 (4) the telegram dated June 3, 1982,

25 and (5) the Certificate of Zoning

Compliance dated July 28, 1982. 26

In addition, Villa executed a special power of

attorney on December 10, 1982 authorizing Anastacio Basas to "deliver to the Human Settlements Regulatory Commission . . all my papers or documents required by the said Commission as requisites for the issuance to me and/or the Funeraria Villa . . (of) the locational clearance for the construction of my funeral parlor along Santiago boulevard, General Santos City. . .

27 pursuant to which on December 15, 1982, said

Basas delivered to the Commission (Enforcement Office), thru one Betty Jimenez

28 copies of Villa's (1) building plan, (2) building permit,

29 (3) occupancy

permit, 30

and (4) "the decision of the Court case involving the funeral parlor". 31

By Order dated January 21, 1983, Commissioner Dizon denied the reconsideration prayed for by Villa in her letter of November 22, 1982, opining that the plea for reconsideration had been presented out of time,

32 and the order of June 29, 1982

had become final and executory. 33

Villa then filed an appeal with "the Commission Proper, which denied it in an order dated September 7, 1983, also on account of the finality of the order of the Commissioner for Enforcement. Her subsequent motion for reconsideration . . (was also) denied in the order of June 7, 1984 . .

34

Villa then sought to take an appeal to the Office of the President. The matter was acted on by the Presidential Assistant for Legal Affairs, respondent Manuel M. Lazaro. In a Resolution dated September 21, 1984, respondent Lazaro denied the "appeal and (Villa's) motion for extension of time to submit an appeal memorandum".

35 It is noteworthy that Lazaro's resolution, like the orders of

Commissioner Dizon and respondent Commission, contains no reference whatsoever to the telegrams and documents sent by Villa to the latter on various occasions evidencing her prompt responses to the orders of Dizon and the Commission, and her

substantial compliance with the general requirement for her to present the requisite clearances or documents of authority for the erection of her funeral parlor. The very skimpy narration of facts set out in the resolution limits itself merely to a citation of the orders of Commissioner Dizon and the Commission; and on that basis, the resolution simplistically concludes that "no appeal was seasonably taken by Mrs. Anita Villa from the order of June 29, 1982, of the HSRC . . (and) (a)ccordingly, said order became final for which reason a writ of execution was issued . . (which) finality was confirmed in the subsequent orders of HSRC, dated January 21, 1983, and September 7, 1983."

Villa filed a motion for reconsideration dated October 19, 1984, this time through counsel, contending that the resolution of September 21, 1984 was "not in conformity with the law and the evidence" and deprived her of due process of law.

36 But this,

too, was denied (with finality) by respondent Lazaro, in a Resolution dated December 14, 1984 which again omitted to refer to the several attempts of Villa to comply with the order of Commissioner Dizon to present the requisite documents of authority anent her funeral parlor and adverted merely to the orders emanating from Dizon and the respondent Commission.

37

These facts present a picture of official incompetence of gross negligence and abdication of duty, if not of active bias and partiality, that is most reprehensible. The result has been to subvert and put to naught the Judgment rendered in a suit regularly tried and decided by a court of justice, to deprive one party of rights confirmed and secured thereby and to accord her adversary, in a different forum, the relief he had sought and been denied in said case.

There is no question that Dr. Jesus Veneracion had resorted to the proscribed practice of forum-shopping when, following adverse judgment of the Court of First Instance in his suit to enjoin the construction of Villa's funeral parlor, he had, instead of appealing that judgment, lodged a complaint with the respondent Commission on substantially the same ground litigated in the action. Also undisputed is that while the respondent Commission took cognizance of the complaint and by telegram required Villa to submit a locational clearance, said respondent did not then or at any time before issuance of the order and writ of execution complained of bother to put her on notice, formally or otherwise, of Veneracion's complaint. It was therefore wholly natural for Villa to assume, as it is apparent she did, that no formal adversarial inquiry was underway and that the telegram was what it purported to be on its face: a routinary request, issued motu proprio, to submit proof of compliance with locational requirements. And such assumption was doubtless fortified by petitioner's knowledge that she already had in her favor a judgment on the subject against which her opponent had taken no recourse by appeal or otherwise.

Neither is there any serious dispute about what transpired thereafter, as already recounted and, in particular, about the fact that in response to that first and the subsequent demands sent by Commissioner Dizon, Villa not once but thrice furnished the Commission by registered mail with copies, variously, of official documents certifying to her compliance with the pertinent locational, zoning and land use requirements and plans. None of these documents appears to have made any impression on Commissioner Dizon, whose show-cause order of April 28, 1982 and order of June 29, 1982 imposing a P10,000.00 fine on petitioner made no mention of them whatsoever. Not even Villa's submission of said documents a fourth time to

support her motion for reconsideration of a writ of execution could move Commissioner Dizon to stop acting as if said documents did not exist at all. True, only copies had been submitted, but ordinary prudence and fairness dictated at least some inquiry into their authenticity, and this would not have posed any great difficulty considering their purportedly official origins.

The mischief done by Commissioner Dizon's baffling failure (or obdurate refusal) even to acknowledge the existence of the documents furnished by petitioner was perpetuated by the "Commissioner proper" and respondent Lazaro (Presidential Assistant on Legal Affairs), who threw out petitioner's appeals with no reference whatsoever thereto and thereby kept in limbo evidence that would have been decisive. The Solicitor General's brief Comment of September 3, 1985

38 neither admits nor denies Villa's claim of having submitted the required

documents; it avoids any reference thereto and deals mainly with the question of the timeliness of her appeal to the respondent Commission and the propriety of the present petition. From such silence and upon what the record otherwise clearly shows, the Court remains in no doubt of the verity of said petitioner's claim that she had more than once submitted those requisite documents.

There was absolutely no excuse for initiating what is held out as an administrative proceeding against Villa without informing her of the complaint which initiated the case; for conducting that inquiry in the most informal manner by means only of communications requiring submission of certain documents, which left the impression that compliance was all that was expected of her and with which directives she promptly and religiously complied; assuming that one of the documents thus successively submitted had been received, but given the fact that on at least two occasions, their transmission had been preceded by telegrams announcing that they would follow by mail, for failing to call Villa's attention to their non-receipt or to make any other attempt to trace their whereabouts; for ruling against Villa on the spurious premise that she had failed to submit the documents required; and for maintaining to the very end that pretense of lack of compliance even after being presented with a fourth set of documents and the decision in the court case upholding her right to operate her funeral parlor in its questioned location.

Whether born of ineptitude negligence, bias or malice, such lapses are indefensible. No excuse can be advanced for avoiding all mention or consideration of certifications issued by respondent Commission's own officials in General Santos City, which included the very relevant one executed by Human Settlements Officer Josefina E. Alaba that petitioner's application for a funeral parlor at the questioned location had . . passed the criteria of this office for this purpose.

39 It was thus not even necessary for

petitioner to bring that document to the notice of the Commission which, together with Commissioner Dizon, was chargeable with knowledge of its own workings and of all acts done in the performance of duty by its officials and employees. Petitioner is plainly the victim of either gross ignorance or negligence or abuse of power, or a combination of both. All of the foregoing translate to a denial of due process against which the defense of failure to take timely appeal will not avail. Well-esconced in our jurisprudence is the rule:

. . that administrative proceedings are not exempt from the operation of certain basic and fundamental procedural principles,

such as the due process requirements in investigations and trials. And this administrative due process is recognized to include (a) the right to notice, be it actual or constructive, of the institution of the proceedings that may affect a person's legal right; (b) reasonable opportunity to appear and defend his rights, introduce witnesses and relevant evidence in his favor, (c) a tribunal so constituted as to give him reasonable assurance of honesty and impartiality, and one of competent jurisdiction; and (d) a finding or decision by that tribunal supported by substantial evidence presented at the hearing, or at least contained in the records or disclosed to the parties affected.

40

and, it being clear that some, at least, of those essential elements did not obtain or were not present in the proceedings complained of, any judgment rendered, or order issued, therein was null and void, could never become final, and could be attacked in any appropriate proceeding.

The Court finds no merit in the proposition that relief is foreclosed to Villa because her motion for reconsideration of November 22, 1982 was filed out of time. The very informal character of the so-called administrative proceedings, an informality for which Commissioner Dizon himself was responsible and which he never sought to rectify, militates against imposing strict observance of the limiting periods applicable to proceedings otherwise properly initiated and regularly conducted. Indeed, considering the rather "off-the-cuff" manner in which the inquiry was carried out, it is not even certain that said petitioner is chargeable with tardiness in connection with any incident thereof. What the record shows is that she invariably responded promptly, at times within a day or two of receiving them, to orders of communications sent to her. At any rate, the Court will not permit the result of an administrative proceeding riddled with the serious defects already pointed out to negate an earlier judgment on the merits on the same matter regularly rendered by competent court.

WHEREFORE, the petition is GRANTED. The proceedings complained of are ANNULLED and all orders, writs and resolutions issued in the course thereof, beginning with the show cause order of June 2, 1982 up to and including the challenged Resolutions of September 21, 1984 and December 14, 1984 of respondent Presidential Assistant Manuel Lazaro are VACATED and SET ASIDE, for having been taken and/or issued in violation of petitioner's right to due process, without pronouncement as to costs.

SO ORDERED.

Cruz, Gancayco, Grio-Aquino and Medialdea, JJ., concur

G.R. Nos. 90660-61 January 21, 1991

UTE PATEROK, petitioner-appellant,

vs. BUREAU OF CUSTOMS and HON. SALVADOR N. MISON, respondents-appellees.

Untalan, Trinidad, Razon, Santos & Associate Law Offices for petitioner-appellant.

SARMIENTO, J.:p

Before us is a special civil action for certiorari filed by Ute Paterok the petitioner herein, seeking the annulment of the decision

1 rendered by the public respondent,

the Bureau of Customs, through its Commissioner, the Hon. Salvador N. Mison, approving the order

2 of forfeiture issued by the District Collector of Customs against

the shipment of one (1) unit of Mercedes Benz of the petitioner in favor of the government.

The antecedent facts are as follows:

In March 1986, the petitioner shipped from Germany to the Philippines two (2) containers, one with used household goods and the other with two (2) used automobiles (one Bourgetti and one Mercedes Benz 450 SLC). The first container was released by the Bureau of Customs and later on, the Bourgetti car, too. The Mercedes Benz, however, remained under the custody of the said Bureau.

In December 1987, after earnest efforts to secure the release of the said Mercedes Benz, the petitioner received a notice

3 of hearing from the legal officer of the Manila

International Container Port, Bureau of Customs informing the former that seizure proceedings were being initiated against the said Mercedes Benz for violation of Batas Pambansa Blg. 73 in relation to Section 2530(F) of the Tariff and Customs Code of the Philippines (TCCP), as amended, and Central Bank Circular (CBC) 1069.

While the said case was pending, the petitioner received only on April, 1988, a letter

4 informing her that a decision ordering the forfeiture of her Mercedes Benz had

been rendered on December 16, 1986 by the District Collector of Customs. The petitioner had not been informed that a separate seizure case was filed on the same Mercedes Benz in question before the said District Collector, an office likewise under the Bureau of Customs.

The petitioner later found out that on November 13, 1986, a Notice of Hearing set on December 2, 1986, concerning the said Mercedes Benz, was posted on the bulletin board of the Bureau of Customs at Port Area, Manila.

The petitioner, thereafter, filed a motion for new trial 5

before the Collector of Customs, Port of Manila, but the latter, in an order

6 dated May 30, 1988, denied the

same, invoking the failure of the former to appear in the said hearing despite the posting of the notice on the bulletin board.

Moreover, the Collector of Customs contended that a reopening of the case was an exercise in futility considering that the forfeited property, a Mercedes Benz 450 SLC, had an engine displacement of more than 2800 cubic centimeters and therefore was under the category of prohibited importation pursuant to B.P. Blg. 73.

Subsequently, the petitioner filed a petition for review 7 with the Department of

Finance, which petition the latter referred to the public respondent. The petitioner likewise addressed a letter

8 to the Hon. Cancio Garcia, the Assistant Executive

Secretary for Legal Affairs, Office of the President, Malacaang, requesting the latter's assistance for a speedy resolution of the said petition.

Finally, the public respondent rendered a decision on September 22, 1989 affirming the previous order of the Collector of Customs for the Forfeiture of the Mercedes Benz in question in favor of the government.

Hence, this petition for certiorari alleging that:

III-1. THE RESPONDENT-APPELLEE (Bureau of Customs) ERRED IN THE RULING THAT A NOTICE OF HEARING POSTED IN [sic] THE BULLETIN BOARD IS SUFFICIENT NOTICE AND FAILURE OF PETITIONER-APPELLANT TO APPEAR CAUSED HER DECLARATION IN DEFAULT;

III-2. ERRED IN RULING THAT THEIR OFFICE WAS LEFT WITH NO ALTERNATIVE BUT TO FORFEIT THE SHIPMENT AS MANDATED BY BATAS PAMBANSA BLG. 73;

III-3. ERRED IN RULING THAT THE RESPONDENT OF OFFICE FINDS THE RE-OPENING OF THE CASE AN EXERCISE IN FUTILITY AND THAT THERE IS NO POINT IN DISTURBING THE DECISION DECREEING THE FORFEITURE OF THE SHIPMENT.

9

As regards the first assignment of error, we agree with the petitioner that a notice of hearing posted on the bulletin board of the public respondent in a forfeiture proceeding where the owner of the alleged prohibited article is known does not constitute sufficient compliance with proper service of notice and procedural due process.

Time and again, the Court has emphasized the imperative necessity for administrative agencies to observe the elementary rules of due process.

10 And no

rule is better established under the due process clause of the Constitution than that which requires notice and opportunity to be heard before any person can be lawfully deprived of his rights.

11

In the present case, although there was a notice of hearing posted on the bulletin board, the said procedure is premised on the ground that the party or owner of the property in question is unknown. This is clear from the provisions of the TCCP relied upon by the public respondent, namely, Sections 2304 and 2306, captioned "Notification of Unknown Owner and "Proceedings in Case of Property Belonging to Unknown Parties," respectively, wherein the posting of the notice of hearing on the bulletin board is specifically allowed.

But in the case at bar, the facts evidently show that the petitioner could not have been unknown. The petitioner had previous transactions with the Bureau of Customs and in fact, the latter had earlier released the first container consisting of household goods and the Bourgetti car to the former at her address (as stated in the Bill of Lading). Moreover, there was a similar seizure case

12 that had been instituted by the Manila

International Container Port, docketed as S.I. No. 86-224, covering the same Mercedes Benz in question and involving the same owner, the petitioner herein.

If only the public respondents had exercised some reasonable diligence to ascertain from their own records the identity and address of the petitioner as the owner and the consignee of the property in question, the necessary information could have been easily obtained which would have assured the sending of the notice of hearing properly and legally. Then, the petitioner would have been afforded the opportunity to be heard and to present her defense which is the essence of procedural due process. But the public respondent regrettably failed to perform such basic duty.

Notwithstanding the procedural infirmity aforementioned, for which the Court expresses its rebuke, the petition nonetheless can not be granted.

This brings us to the second and third assignments of error raised by the petitioner.

Batas Pambansa Blg. 73, a law intended to promote energy conservation, provides that:

Sec. 3. Towards the same end and to develop a more dynamic and effective program for the rational use of energy, the following acts are hereby prohibited:

(a) The importation, manufacture or assembling of gasoline-powered passenger motor cars with engine displacement of over 2,800 cubic centimeters or Kerbweight exceeding 1,500 kilograms, including accessories.

13

The petitioner does not dispute the fact that the motor car in question, a Mercedes Benz 450 SLC, has an engine displacement of over 2,800 cubic centimeters which clearly falls within the prohibited importation specified in the law aforequoted and as such, is liable for seizure and forfeiture by the public respondents.

On the other hand, the petitioner claims that the said prohibition involves only "direct" and not 'indirect" importation as when both the shipper and the consignee are one and the same person which is the case at bar. Be that as it may, the law is clear and when it does not make any distinction on the term "importation", we likewise must not distinguish. "Ubi lex non distinguit nec nos distinguiere debemus."

Finally, the petitioner invokes Sec. 2307 of the TCCP, as amended by Executive Order No. 38, dated August 6, 1986, which provides an alternative in lieu of the forfeiture of the property in question, that is, the payment of fine or redemption of the forfeited property. But the last paragraph of the said section, as amended, categorically states that:

Redemption of forfeited property shall not be allowed in any case where the importation is absolutely prohibited or where the surrender of the property to the person offering to redeem the same would be contrary to law. (Emphasis ours)

14

Inasmuch as it would be contrary to law, i.e., B.P. Blg. 73, to allow the petitioner to redeem the Mercedes Benz in question, there is therefore no alternative, as correctly claimed by the public respondents, but to forfeit the same.

We can not agree with the proposition that the Collector of Customs is authorized to release the motor vehicle in question to the petitioner which, in effect, would absolve the latter from any liability.

In the matter of disposing of contrabands, Section 2609(c) of the Tariff and Customs Code specifically provides that the prerogative of the Collector of Customs is not the release of the contraband like the Mercedes Benz in question but its sale, which presupposes a prior custody pursuant to forfeiture and seizure proceedings as in the case at bar.

As thus worded:

Sec. 2609. Disposition of Contraband. Article of prohibited importation or exportation, known as contraband, shall, in the absence of special provision, be dealt with as follows:

xxx xxx xxx

(c) Other contraband of commercial value and capable of legitimate use may be sold under such restrictions as will insure its use for legitimate purposes only . . .

There is nothing in the Code that authorizes the Collector to release the contraband in favor of an importer. The Code, on the other hand, is clear that the thing may be disposed of by sale alone "under such restrictions as will insure its use for legitimate purposes." To be sure, the restrictions to be prescribed by the Collector must coincide with the purpose underlying Batas Blg. 73, that is, to conserve energy. Hence, he can not allow its use (after sale), in this case a Mercedes Benz with an engine displacement of more than 2,800 cubic centimeters, that would set at naught that purpose. He must make sure that the engine is changed before it is allowed to ply Philippine soil.

In all cases, forfeiture is a must.

WHEREFORE, the petition for certiorari is DISMISSED. No costs.

SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Bidin, Grino-Aquino, Medialdea and Regalado, JJ., concur.

[G.R. No. 117565. November 18, 1997]

ARSENIO P. LUMIQUED (deceased), Regional Director, DAR CAR, Represented by his Heirs, Francisca A. Lumiqued, May A. Lumiqued, Arlene A. Lumiqued and Richard A. Lumiqued, petitioners, vs. Honorable APOLINIO G. EXEVEA, ERDOLFO V. BALAJADIA and FELIX T. CABADING, ALL Members of Investigating Committee, created by DOJ Order No. 145 on May 30, 1992; HON. FRANKLIN M. DRILON, SECRETARY OF JUSTICE, HON. ANTONIO T. CARPIO, CHIEF Presidential Legal Adviser/Counsel; and HON. LEONARDO A. QUISIMBING, Senior Deputy Executive Secretary of the Office of the President, and JEANNETTE OBAR-ZAMUDIO, Private Respondent, respondents.

D E C I S I O N

ROMERO, J.:

Does the due process clause encompass the right to be assisted by counsel during an administrative inquiry?

Arsenio P. Lumiqued was the Regional Director of the Department of Agrarian Reform Cordillera Autonomous Region (DAR-CAR) until President Fidel V. Ramos dismissed him from that position pursuant to Administrative Order No. 52 dated May 12, 1993. In view of Lumiqueds death on May 19, 1994, his heirs instituted this petition for certiorari and mandamus, questioning such order.

The dismissal was the aftermath of three complaints filed by DAR-CAR Regional Cashier and private respondent Jeannette Obar-Zamudio with the Board of Discipline of the DAR. The first affidavit-complaint dated November 16, 1989,

[1] charged Lumiqued with malversation through falsification of

official documents. From May to September 1989, Lumiqued allegedly committed at least 93 counts of falsification by padding gasoline receipts. He even submitted a vulcanizing shop receipt worth P550.00 for gasoline bought from the shop, and another receipt for P660.00 for a single vulcanizing job. With the use of falsified receipts, Lumiqued claimed and was reimbursed the sum of P44,172.46. Private respondent added that Lumiqued seldom made field trips and preferred to stay in the office, making it impossible for him to consume the nearly 120 liters of gasoline he claimed everyday.

In her second affidavit-complaint dated November 22, 1989,[2]

private respondent accused Lumiqued with violation of Commission on Audit (COA) rules and regulations, alleging that during the months of April, May, July, August, September and October, 1989, he made unliquidated cash advances in the total amount of P116,000.00. Lumiqued purportedly defrauded the government by deliberately concealing his unliquidated cash advances through the falsification of accounting entries in order not to reflect

http://sc.judiciary.gov.ph/jurisprudence/1997/nov1997/117565.htm#_edn1http://sc.judiciary.gov.ph/jurisprudence/1997/nov1997/117565.htm#_edn2

on `Cash advances of other officials under code 8-70-600 of accounting rules.

The third affidavit-complaint dated December 15, 1989,[3]

charged Lumiqued with oppression and harassment. According to private respondent, her two previous complaints prompted Lumiqued to retaliate by relieving her from her post as Regional Cashier without just cause.

The three affidavit-complaints were referred in due course to the Department of Justice (DOJ) for appropriate action. On May 20, 1992, Acting Justice Secretary Eduardo G. Montenegro issued Department Order No. 145 creating a committee to investigate the complaints against Lumiqued. The order appointed Regional State Prosecutor Apolinario Exevea as committee chairman with City Prosecutor Erdolfo Balajadia and Provincial Prosecutor Felix Cabading as members. They were mandated to conduct an investigation within thirty days from receipt of the order, and to submit their report and recommendation within fifteen days from its conclusion.

The investigating committee accordingly issued a subpoena directing Lumiqued to submit his counter-affidavit on or before June 17, 1992. Lumiqued, however, filed instead an urgent motion to defer submission of his counter-affidavit pending actual receipt of two of private respondents complaints. The committee granted the motion and gave him a five-day extension.

In his counter-affidavit dated June 23, 1992,[4]

Lumiqued alleged, inter alia, that the cases were filed against him to extort money from innocent

public servants like him, and were initiated by private respondent in connivance with a certain Benedict Ballug of Tarlac and a certain Benigno Aquino III. He claimed that the apparent weakness of the charge was bolstered by private respondents execution of an affidavit of desistance.

[5]

Lumiqued admitted that his average daily gasoline consumption was 108.45 liters. He submitted, however, that such consumption was warranted as it was the aggregate consumption of the five service vehicles issued under his name and intended for the use of the Office of the Regional Director of the DAR. He added that the receipts which were issued beyond his region were made in the course of his travels to Ifugao Province, the DAR Central Office in Diliman, Quezon City, and Laguna, where he attended a seminar. Because these receipts were merely turned over to him by drivers for reimbursement, it was not his obligation but that of auditors and accountants to determine whether they were falsified. He affixed his signature on the receipts only to signify that the same were validly issued by the establishments concerned in order that official transactions of the DAR-CAR could be carried out.

Explaining why a vulcanizing shop issued a gasoline receipt, Lumiqued said that he and his companions were cruising along Santa Fe, Nueva Vizcaya on their way to Ifugao when their service vehicle ran out of gas. Since it was almost midnight, they sought the help of the owner of a vulcanizing shop who readily furnished them with the gasoline they needed. The vulcanizing shop issued its own receipt so that they could reimburse the cost of the gasoline. Domingo Lucero, the owner of said vulcanizing shop, corroborated this explanation in an affidavit dated June 25, 1990.

[6] With

respect to the accusation that he sought reimbursement in the amount of P660.00 for one vulcanizing job, Lumiqued submitted that the amount was actually only P6.60. Any error committed in posting the amount in the books of the Regional Office was not his personal error or accountability.

To refute private respondents allegation that he violated COA rules and regulations in incurring unliquidated cash advances in the amount of P116,000.00, Lumiqued presented a certification

[7] of DAR-CAR

Administrative Officer Deogracias F. Almora that he had no outstanding cash advances on record as of December 31, 1989.

In disputing the charges of oppression and harassment against him, Lumiqued contended that private respondent was not terminated from the service but was merely relieved of her duties due to her prolonged absences. While admitting that private respondent filed the required applications for leave of absence, Lumiqued claimed that the exigency of the service necessitated disapproval of her application for leave of absence. He allegedly rejected her second application for leave of absence in view of her failure to file the same immediately with the head office or upon her return to work. He also asserted that no medical certificate supported her application for leave of absence.

In the same counter-affidavit, Lumiqued also claimed that private respondent was corrupt and dishonest because a COA examination revealed that her cash accountabilities from June 22 to November 23, 1989, were short by P30,406.87. Although private respondent immediately returned the amount on January 18, 1990, the day following the completion of the cash examination, Lumiqued claimed that she should be relieved from her duties and assigned to jobs that would not require handling of cash and money matters.

Committee hearings on the complaints were conducted on July 3 and 10, 1992, but Lumiqued was not assisted by counsel. On the second hearing date, he moved for its resetting to July 17, 1992, to enable him to employ the services of counsel. The committee granted the motion, but neither Lumiqued nor his counsel appeared on the date he himself had chosen, so the committee deemed the case submitted for resolution.

On August 12, 1992, Lumiqued filed an urgent motion for additional hearing,

[8] alleging that he suffered a stroke on July 10, 1992. The motion

was forwarded to the Office of the State Prosecutor apparently because the investigation had already been terminated. In an order dated September 7, 1992,

[9] State Prosecutor Zoila C. Montero denied the motion, viz:

The medical certificate given show(s) that respondent was discharged from the Sacred Heart

Hospital on July 17, 1992, the date of the hearing, which date was upon the request of

respondent (Lumiqued). The records do not disclose that respondent advised the Investigating

committee of his confinement and inability to attend despite his discharge, either by himself or

thru counsel. The records likewise do not show that efforts were exerted to notify the

Committee of respondents condition on any reasonable date after July 17, 1992. It is herein noted that as early as June 23, 1992, respondent was already being assisted by counsel.

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Moreover an evaluation of the counter-affidavit submitted reveal(s) the sufficiency,

completeness and thoroughness of the counter-affidavit together with the documentary

evidence annexed thereto, such that a judicious determination of the case based on the

pleadings submitted is already possible.

Moreover, considering that the complaint-affidavit was filed as far back as November 16, 1989 yet, justice can not be delayed much longer.

Following the conclusion of the hearings, the investigating committee rendered a report dated July 31, 1992,

[10] finding Lumiqued liable for all the

charges against him. It made the following findings:

After a thorough evaluation of the evidences (sic) submitted by the parties, this committee

finds the evidence submitted by the complainant sufficient to establish the guilt of the

respondent for Gross Dishonesty and Grave Misconduct.

That most of the gasoline receipts used by the respondent in claiming for the reimbursement of

his gasoline expenses were falsified is clearly established by the 15 Certified Xerox Copies of

the duplicate receipts (Annexes G-1 to G-15) and the certifications issued by the different

gasoline stations where the respondent purchased gasoline. Annexes `G-1 to `G-15 show that

the actual average purchase made by the respondent is about 8.46 liters only at a purchase

price of P50.00, in contrast to the receipts used by the respondent which reflects an average of

108.45 liters at a purchase price of P550.00. Here, the greed of the respondent is made

manifest by his act of claiming reimbursements of more than 10 times the value of what he

actually spends. While only 15 of the gasoline receipts were ascertained to have been falsified,

the motive, the pattern and the scheme employed by the respondent in defrauding the government has, nevertheless, been established.

That the gasoline receipts have been falsified was not rebutted by the respondent. In fact, he

had in effect admitted that he had been claiming for the payment of an average consumption of

108.45 liters/day by justifying that this was being used by the 4 vehicles issued to his office.

Besides he also admitted having signed the receipts.

Respondents act in defrauding the government of a considerable sum of money by falsifying

receipts constitutes not only Dishonesty of a high degree but also a criminal offense for Malversation through Falsification of Official Documents.

This committee likewise finds that the respondent have (sic) unliquidated cash advances in the

year 1989 which is in violation of established office and auditing rules. His cash advances

totalling to aboutP116,000.00 were properly documented. The requests for obligation of

allotments and the vouchers covering the amounts were all signed by him. The mere

certification issued by the Administrative Officer of the DAR-CAR cannot therefore rebut these concrete evidences (sic).

On the third complaint, this committee likewise believes that the respondents act in relieving

the complainant of her functions as a Regional Cashier on December 1, 1989 was an act of

harassment. It is noted that this was done barely two weeks after the complainant filed charges

against her (sic). The recommendation of Jose G. Medina of the Commission on Audit came

only on May 11, 1990 or almost six months after the respondents order relieving the

complainant was issued. His act in harassing a subordinate employee in retaliation to a

complaint she filed constitute(s) Gross Misconduct on the part of the respondent who is a head of office.

The affidavits of Joseph In-uyay and Josefina Guting are of no help to the respondent. In fact,

this only show(s) that he is capable of giving bribes if only to have the cases against him

dismissed. He could not have given a certain Benigno Aquino III the sum of P10,000.00 for any other purpose.

Accordingly, the investigating committee recommended Lumiqueds dismissal or removal from office, without prejudice to the filing of the appropriate criminal charges against him.

Acting on the report and recommendation, former Justice Secretary Franklin M. Drilon adopted the same in his Memorandum to President Fidel V. Ramos dated October 22, 1992. He added that the filing of the affidavit of desistance

[11] would not prevent the issuance of a resolution on the matter

considering that what was at stake was not only the violation of complainants (herein private respondents) personal rights but also the competence and fitness of the respondent (Lumiqued) to remain in public office. He opined that, in fact, the evidence on record could call for a punitive action against the respondent on the initiative of the DAR.

On December 17, 1992, Lumiqued filed a motion for reconsideration of the findings of the Committee with the DOJ.

[12] Undersecretary Ramon S.

Esguerra indorsed the motion to the investigating committee.[13]

In a letter dated April 1, 1993, the three-member investigating committee informed Undersecretary Esguerra that the committee had no more authority to act on the same (motion for reconsideration) considering that the matter has already been forwarded to the Office of the President and that their authority under Department Order No. 145 ceased when they transmitted their report to the DOJ.

[14] Concurring with this view, Undersecretary

Esguerra informed Lumiqued that the investigating committee could no longer act on his motion for reconsideration. He added that the motion was also prematurely filed because the Office of the President (OP) had yet to act on Secretary Drilons recommendation.

[15]

On May 12, 1993, President Fidel V. Ramos himself issued Administrative Order No. 52 (A.O. No. 52),

[16] finding Lumiqued

administratively liable for dishonesty in the alteration of fifteen gasoline receipts, and dismissing him from the service, with forfeiture of his retirement and other benefits. Thus:

That the receipts were merely turned over to him by his drivers and that the auditor and

accountant of the DAR-CAR should be the ones to be held liable is untenable. The receipts in

question were signed by respondent for the purpose of attesting that those receipts were

validly issued by the commercial establishments and were properly disbursed and used in the official business for which it was intended.

This Office is not about to shift the blame for all these to the drivers employed by the DAR-CAR as respondent would want us to do.

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The OP, however, found that the charges of oppression and harassment, as well as that of incurring unliquidated cash advances, were not satisfactorily established.

In a petition for appeal[17]

addressed to President Ramos, Lumiqued prayed that A.O. No. 52 be reconsidered and that he be reinstated to his former position with all the benefits accorded to him by law and existing rules and regulations. This petition was basically premised on the affidavit dated May 27, 1993, of a certain Dwight L. Lumiqued, a former driver of the DAR-CAR, who confessed to having authored the falsification of gasoline receipts and attested to petitioner Lumiqueds being an honest man who had no premonition that the receipts he (Dwight) turned over to him were altered.

[18]

Treating the petition for appeal as a motion for the reconsideration of A.O. No. 52, the OP, through Senior Deputy Executive Secretary Leonardo A. Quisumbing, denied the same on August 31, 1993.

Undaunted, Lumiqued filed a second motion for reconsideration, alleging, among other things, that he was denied the constitutional right to counsel during the hearing.

[19] On May 19, 1994,

[20] however, before his

motion could be resolved, Lumiqued died. On September 28, 1994,

[21] Secretary Quisumbing denied the second motion for

reconsideration for lack of merit.

Hence, the instant petition for certiorari and mandamus praying for the reversal of the Report and Recommendation of the Investigating Committee, the October 22, 1992, Memorandum of then Justice Secretary Drilon, A.O. No. 52 issued by President Ramos, and the orders of Secretary Quisumbing. In a nutshell, it prays for the payment of retirement benefits and other benefits accorded to deceased Arsenio Lumiqued by law, payable to his heirs; and the backwages from the period he was dismissed from service up to the time of his death on May 19, 1994.

[22]

Petitioners fault the investigating committee for its failure to inform Lumiqued of his right to counsel during the hearing. They maintain that his right to counsel could not be waived unless the waiver was in writing and in the presence of counsel. They assert that the committee should have suspended the hearing and granted Lumiqued a reasonable time within which to secure a counsel of his own. If suspension was not possible, the committee should have appointed a counsel de oficio to assist him.

These arguments are untenable and misplaced. The right to counsel, which cannot be waived unless the waiver is in writing and in the presence of counsel, is a right afforded a suspect or an accused during custodial investigation.

[23] It is not an absolute right and may, thus, be invoked or

rejected in a criminal proceeding and, with more reason, in an administrative inquiry. In the case at bar, petitioners invoke the right of an accused in criminal proceedings to have competent and independent counsel of his own choice. Lumiqued, however, was not accused of any crime in the proceedings below. The investigation conducted by the committee created by Department Order No. 145 was for the purpose of determining if he could be held administratively liable under the law for the complaints filed against

him. The order issued by Acting Secretary of Justice Montenegro states thus:

In the interest of the public service and pursuant to the provisions of existing laws, a

Committee to conduct the formal investigation of the administrative complaint for oppression,

dishonesty, disgraceful and immoral conduct, being notoriously undesirable and conduct

prejudicial to the best interest of the service against Mr. ARSENIO P. LUMIQUED, Regional

Director, Department of Agrarian Reform, Cordillera Autonomous Region, is hereby created x x x.[24]

As such, the hearing conducted by the investigating committee was not part of a criminal prosecution. This was even made more pronounced when, after finding Lumiqued administratively liable, it hinted at the filing of criminal case for malversation through falsification of public documents in its report and recommendation.

Petitioners misconception on the nature of the investigation

[25] conducted against Lumiqued appears to have been

engendered by the fact that the DOJ conducted it. While it is true that under the Administrative Code of 1987, the DOJ shall administer the criminal justice system in accordance with the accepted processes thereof consisting in the investigation of the crimes, prosecution of offenders and administration of the correctional system,

[26] conducting criminal

investigations is not its sole function. By its power to perform such other functions as may be provided by law,

[27] prosecutors may be called upon to

conduct administrative investigations. Accordingly, the investigating committee created by Department Order No. 145 was duty-bound to conduct the administrative investigation in accordance with the rules therefor.

While investigations conducted by an administrative body may at times be akin to a criminal proceeding, the fact remains that under existing laws, a party in an administrative inquiry may or may not be assisted by counsel, irrespective of the nature of the charges and of the respondents capacity to represent himself and no duty rests on such a body to furnish the person being investigated with counsel.

[28] In an administrative proceeding

such as the one that transpired below, a respondent (such as Lumiqued) has the option of engaging the services of counsel or not. This is clear from the provisions of Section 32, Article VII of Republic Act No. 2260

[29] (otherwise

known as the Civil Service Act) and Section 39, paragraph 2, Rule XIV (on discipline) of the Omnibus Rules Implementing Book V of Executive Order