REPUBLIC OF THE PHILIPPINES REGIONAL TRIAL COURT

TIONAL CAPITAL JUDICIAL REGIO . PARANAQUE CITY

BRANCH ---

TELENGT AN BROTHERS & SONS, Inc., Doing business under the name and style LA SUERTE CIGAR AND CIGARETTE FACTORY,

Petitioner,

f'l;1~· -versus -

THE DEPARTMENT OF HEALTH, Respondent.

)(- - - - --- -- - - - - - - - - - - - - - - - - - - -)(

CASE NO. ID .. rn 11

PETITION F~ DECCAJU TORY RELIEF , With

APPLICATION FOR PRELIMINARY INJUNCTION

Petitioner, by counsel, respectfully states:

NATURE OF THE PETITION

1. This is a petition for declaratory relief against respondent's

Administrative Order No. 2010-0013 dated 12 May 2010 and, after

publication, deemed effective on 10 June 2010. A certified copy of the

questioned Administrative Order is attached to the original of this

petition as Anne)( "A".

2. Paragraph VI (1) of this Administrative Order provides a ninety (90) day '.' " .,

grace period to comply with its edict, or until 08 September 2010.

3. This Administrative Order is Null and Void for having been issued

without authority, issued in violation of Republic Act No. 9211 known as

the "Tobacco Regulation Act of 2003", issued in violation of petitioner's

constitutional rights to due process and issued without an enabling law.

PARTIES

4. Petitioner is a corporation organized and existing under Philippine Laws

with address at Km. 14 South Superhighway, Parafiaque City. It may be

served 1)otices, orders and other processes of this Court through

undersigned counsel.

5. Respondent is the adminie!rative age.flcy of the government charged with

promoting the health policies thereof. It holds office at the San Lazaro

Compound, Rizal Avenue, Sta. Cruz, Manila, where it may be served

summons, notices, orders and other processes of this Court.

STATEMENT OF FACTS

6. Petitioner is a manufacturer of cigarette products. A copy of petitioner's

Articles of Incorporation, inclusive of amendments, is attached as Annex

"B" with sub-markings.

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7. Among its cigarette brands are "Astro", "Canon", and "Memphis" which

are currently sold to dom<rr!ic and ~oreign m~r~e~s'k-" # ,

. Ii . A If ~ /I C' fi i t ~ l·1t ~(,' It, ; 'Ii' ' (7 J

8. On 23 June 2003, the Tobacco Regulation Act of 2003 was enacted into

law. This became effective on 13 July 2003. A copy of Republic Act No.

9211 is attached as Annex "C".

9. The pertinent provisions of the Tobacco Regulation Act of 2003 are as

follows:

"Section 3. Purpose - It is the main thrust of this Act to:

a. Promote a healthful environment; b. Inform the public of the health risks associated with cigarette smoking and

tobacco use; c. Regulate and subsequently ban all tobacco advertisements and sponsorships; d .. Regulate the labeling of tobacco products; e. Protect the youth from being initiated to cigarette smoking and tobacco use by

prohibiting the sale of tobacco products to minors; f. Assists and encourage Filipino tobacco farmers to cultivate alternative

agricultural crops to prevent economic dislocation; and g. Create an Inter-Agency Commit1!ee 011 Tobacco (lAC-Tobacco) to oversee the

implementation orth~rovisjon of this Act.

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Section 13. Warnillg Oil Cigarette Packages - Under this Act:

a. All packages in which tobacco prpducts are provided to consumers withdrawn from the manufacturing facility of all manufacturers or imported into the Philippines intended for sale to the market, starting 1 January 2004, shall be printed, in either English or Filipino, on a rotating basis or separately and simultaneously, the following health warnings: "GOVERNMENT WARNING: Cigarette Smoking is Dangerous to Your Health, "GOVERNMENT WARNING: Cigarettes are Addictive"; "GOVERNMENT WARNING: Tobacco Can Harm Your Children"; or "GOVERNMENT WARNING: Smoking Kills."

b. Upon effectivity of this Act until 30 June 2006, the health warning shall be located on one side panel of every tobacco product package and occupy not less than fifty percent (50%) of such side panel including any border of frame.

c. Beginning. 1 July 2006, the health warning shall be on the bottom portion of one (1) front panel of every tobacco product package and occupy not less than thirty percent (30%) of such panel including any border or frame. The text .of

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the warning shall appear in clearly legible type in black text on a white background with a black border and in contrasts by typography, layout or color to the other printer materials on the package. The health warning shall occupy a total area of not less than fifty percent (50%) of the total warning frame.

d. 'The warning shall be rotated periodically, or separately and simultaneously printed, so that within any twenty-four (24) month period, the four (4) variations of the warnings shall appear with proportionate frequency.

e. The warning shall not be hidden or obscured by other printed information or images, or printed in a location where tax or fiscal stamps are likely to be applied to the package or placed in a location where it will be damaged when the package is opened. If the warning to be printed on the package is likely to be obscured or obliterated by a wrapper on the package, the warning must be printed on both the wrapper and the package.

f. In addition to the health warning all packages of tobacco products that are provided to consumers shall contain, on one side panel the following statement in a clear, legible and conspicuous manner; "NO SALE TO MINORS" or "NOT FOR SALE TO MINORS." The statement shall occupied an area of not less than ten percent (10%) of such side panel and shall appear in contrast by color, typography or layout with all the other printed material on the side panel.

g. No other printed warnings, except the health warning and the message required in this Section, paragraph F shall be placed on cigarette packages.

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Section 29. Implementing Agency. - An Inter-Agency Committee- Tobacco (lAC-Tobacco), which shall have the exclusive power and function to administer and implement the provisions of this Act, is hereby created. The lAC-Tobacco shall be chaired by the Secretary of the Department of Trade and Industry (DTI) with the Secretary of the Department of Health (DOH) as Vice Chairperson. The lAC-Tobacco shall have the following members:

a. Secretary of the Department of Agriculture (DA); b. Secretary of the Department of Justice (DOJ); c. Secretary of the Department of Environment and Natural Resources (DENR); d. Secretary of the Department of Science and Technology (DOST); e. Secretary of the Department of Education (DepEd); f. Administrator of the National Tobacco Administration (NT A); g. A representative from the Tobacco Industry to be nominated by the legitimate

. and recognized associations of the industry; and h. A representative from a non-government organization (NGO) involved in

public health promotion nominated by DOH in consultation with the concerned NGO's;

The Department Secretaries may designate their Undersecretaries as their authorized representatives to the lAC.

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Section 32. Penalties - The following penalties shall apply:

a. Violation of Sections 5 and 6. - On the first offense, a fine of not less than Five Hundred Pesos (Php500.00) but not more than One Thousand (Php 1,000.00) shall be imposed. , On the second offense, a fine of not less than One Thousand Pesos (Php 1,000.00) but not more than Five Thousand Pesos (Php5,000.00) shall be imposed. On the third offense, in addition to a fine of not less than Five Thousand Pesos (PS,OOO.OO) but not more than Teli Thousand pesos - (Php 10,000.00), the business permits and licenses to operate shall be cancelled or revoked.

b. Violation pf Sections 7,8,9, 10 and 11 - On the first offense, any person or any business. entity or establishment selling to, distributing or purchasing a

. cigarette or any other tobacco products for a minor shall be fined the amount of not less than Five Thousand Pesos (Php5,000.00) or an imprisonment of not more than thirty (30) days, upon the discretion of the business licenses or permits in the case of a business entity or establishment. If the violation is by establishment of business entity, the owner, president, manager, or the most senior officers thereof shall be liable for the offense. If a minor is caught selling, buying or smoking cigarettes or any other tobacco products, the provisions of Article 189 of Presidential Decree No. 603 otherwise known as The Child and Youth Welfare Code, as amended, shall apply.

c. Violation of Section 13 to 27 - On the first offense, a fine of not more than ~-

One Hundred thous~ pesos (Phe 1 00,000.00) or imprisonment of not more than one (1) year, or both, at the discretion of the court shall be imposed. 1 awph'ii.net On the second offense, a fine of Two hundred thousand

. pesos (Php200,000.00) or imprisonment of not more than two (2) years, or both, at the discretion of the court shall be imposed. On the third offense, in addition to a fine of not more than Four Hundred thousand pesos (Php400,000.00) or imprisonment of not more than three (3) years, or both at the discretion of the court, the business pem1 its and 1 icenses, in the case of a business entity or establishment shall be revoked or cancelled. In the case of a business entity or establishment, the owner, president, manager or officials thereof shall be liable. If the guilty officer is an alien, he shall summarily be deported after serving his sentence and shall be forever barred from re-entering from the Philippines.

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Section 39. Repealing Clause. - DOH Administrative Orders No. 10 s. 1993 and No. 24 s. 1993 arc hereby repealed. Article 94 of Republic Act No. 7394, as amended, otherwise known as the Consumer Act of the Philippines, is hereby amended. All other laws, decrees, ordinances, administrative orders, rules and regulations, or any part thereof, which are consistent with this Act are likewise repealed or amended accordingly."

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10. On 24 May 20 1 0, respondent issued Administrative Order No. 20 I 0-

0013. This became effective on 10 June 2010.

1 LThe pertinent provisions of Administrative Order No. 2010-0013 are as

follows:

"I. OBJECTIVES

-It is the policy of the State to promote the right to health of all the people and instill health consciousness among them. The State affirms this as one of the fundamental rights of a human being. Towards this end, the State shall implement effective measures to achieve the following objectives:

a. Provide necessary information about the health consequences, addictive nature, and mortal threat posed by tobacco consumption and exposure to tobacco smoke through measures that are scientifically proven to be effective in increasing pubic awareness of the health effects of tobacco use and in reducing tobacco consumption;

b. Protect consumers from deceptive labels, packaging, descriptions and practices related to tobacco use;

c. Implement measures to prohibit means that are false, misleading, deceptive or likely to create an erroneous impression about the characteristics of tobacco, its health effects, hazards or errti-ssions, so as to promote tobacco products in tobacco productpack~es. .,

To achieve these objectives, the Department shall ensure that effective, distinct, and highly visible graphic health information is placed on tobacco product packages.

Moreover, the Department shall ensure that tobacco product packaging and labeling do not promote a tobacco product by any means that are false, misleading, deceptive, or likely to create an erroneous impression about the product and its characteristics, health effects, hazards or emissions.

II. SCOPE AND COVERAGE

These policies and guidelines shall apply to all tobacco products and to all tobacco manufacturers, importers, exporters, wholesalers, distributors, retailers, concessionaires, and other sellers of tobacco products, as well as their agents and agents and representatives, which are operating, existing, and/or found within the Republic of the Philippines.

III. DEFINITIONS OF TERMS

a. "Grapllic'Healtlt Ill/ormation" means statements, and/or other information, . accompanied by related full-color pictures or pictograms, which inform about

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the contents and substances, in descriptive form, of tobacco products as well as inform against health dangers and other problems related 'to tobacco products, tobacco consumption, exposure to tobacco smoke, or other effects of tobacco use.

b. "Tobacco Prot/llct Package" means the packet and package of tobacco products and any outside packaging and labeling of tobacco products for sale, distribution, exportation, importation, trade, exchange, or exhibition, such as, but not limited to, packs, tins, boxes, pouches, flip~tops, slide and shell packages, cartons, transparent wrappers, clear packaging, packages containing one product unit, master cases, or other containers of tobacco products.

c. "Tobacco Products" means products entirely or partly made of leaf tobacco as raw material, which are manufactured to bused for smoking, sucking, chewing or snuffing, or by any other means of consumption.

d. "Insert" means any communication inside an individual packages and/or carton purchased at either wholesale or retail by consumers, such as a leanet or bro..:hure.

e. "OlSert" means any communication affixed to the outside of an individual package and/or carton purchased at either wholesale or retail by consumers, sli,ch as a brochure beneath the outer cellophane wrapping or glued to the outside of the cigarette package.

IV. SPECIFIC PROVISIONS

'1he Department hereby promulg~es the following rules and regulations iSoverning packaging. and J!beling of to~acco products.

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A. Graphic Health Information

1. Scope of Grapltic Hea/tlt Illformatioll. Each unit packet and package of tobacco products, including packages inserts and onserts, and any outside packaging and labeling of stich products for sale, distribution or importation within the country, shall bear large, clear, visible, and legible full-color graphic health information, as attached in Annex 1.

2. Size and Position of Graphic Hea/th Information. - The graphic health information shall occupy the upper portions of each tobacco product packet or package and no less than thirty percent (30%) of the front panel and sixty percent (60%) ofthe back panel (or all corresponding panels of the unit packet or package if in non~standard packaging) in a manner that ensures maximum visibility.

3. Rotation. - There shall be a minimum of eight (8) variations of graphic health information that shall appear concurrently within a twenty four (24) month period. The variations shall appear on an equal number of retail tobacco product packages for each brand and for each package size and type.

4. Transitions. - During transition periods, when an old set of graphic health information is being replaced by a new set, there shall be a phase-in period of

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sixty (60) days between sets of graphic health information, during which time both sets may be used concurrently.

5. Templates. - The templates of graphic health information, which contain specific printing and other requirements, shall be issued by the Department on its own, or upon consultation with organizations with established tract record of, and expertise in public health policies and duly recognized by the Department as such. The template(s) shall be approved by the Secretary within thirty (30) days from its submission and shall be deemed automatically approved if not acted upon thereafter.

6. Strict Adherence The tobacco - manufacturers, importers, exporters, wholesalers, distributors, retailers, concessionaires, and other sellers, shall strictly follow the templates and shall submit their packagings and labelings for approval to the Department no later than three (3) months before they are to be used. The Department shall act on the packaging and labeling of the unit packet and package of tobacco products within thirty (30) days from its submission and shall be deemed automatically approved if not acted upon thereafter.

B. Misleading Descriptors

1. General Prohibitioll. Each unit packet and package of tobacc'o products, including package inserts and onserts, and any outside packaging and labeling of such products for sale, distribution .or importation within the country shall not promote a tobacco product by any means that are raise, misleading, deceptive or likely to create an erroneous impression about the product's characteristics, health effects, Jlazards or emissions, including any term, descriptor, trademark,Jigurative 'o~ any other sign (including colors, images, or numbers) or any packages or product design feature that directly or indirectly create or are likely to. create the false impression that a particular tobacco product or brand is less harmful than any other tobacco product or brand.

Use of misleading descriptors on tobacco products packages such as, but not limited to, "low tar", "light", "ultra-light", "mild", "ultra", and similar terms in any language that might mislead conSllmers, is prohibited. Use of corresponding symbols or colors signifying the same is also prohibited. No misleading descriptor shall be lIsed as part of a brand name or trademark for tobacco products introduced after the effectivity of this Order.

'") Prohibition 011 ilfisleadillg In/ormation. - Information that may imply that one variant or brand is safer than the other is prohibited, such as statements indicating that the tobacco product contains "reduced levds" of contents, substances, and emissions. Figures for emission yields, such as for tar, nicotine and carbon monoxide, shal1b prohibited, including when used as part of a brand name or trademark.

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V. COMMON PROVISION

1. Compliance - Tobacco product packages that do not comply with this Order shall be prohibited after ninety (90 days) from the effectivity of this Order. Non-complaint products must be withdrawn no later than such date. Absolutely no extensions of time to comply with the provisions of this Order shall be granted to tobacco manufacturers or ahy other affected party."

ISSUE

12.Whether or not respondent's Administrative Order No. 2010-0013 is null

and void.

DISCUSSION

13..Administrative Order No. 20 I 0-00 13 \\as issued without authority. , ','If); ~ ""7

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"l/e 14. Section 29 of the Tobacco Regulation Act of 2003 m'andates that the

Inter-Agency-Committee on' Tobacco (lAC-Tobacco) shall have the

"exclusive power and function to administer and implement" the " ~~,

'­provisions of the said law.' ,

I5.The power to regulate the label of tobacco products under Section 3 (d)

of the Tobacco Regulation Act of 2003 is clearly under the exclusive

jurisdiction of the IAC-Tobacco.

16.Jt is therefore clear that respondent Department of Health has neither

authority nor basis in issuing Administrative Order No. 2010-00) 3.

17.Thus, in "Mirasol et al vs. DPWH et al", GR No.158793 dated 08 June

2006, the Supreme Court held:

"OPWH issued DO 74 and DO 215 declaring certain expressways as limited , access facilities on 5 April 1993 and 25 June 1998, respectively. Later, the TRB, under the OPWH, issued the Revised Rules and Regulations on Limited Access

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Facilitis. However, on 23 July 1979, long before these department orders and regula10ns were issued,' the Ministry of Public Works, Transportation and Comn:mications was divided into two agencies the Ministry of Public Works and tl~ Ministry of Transportation and Communications hy virtue of EO 546. The uestion is, }l'hich (d' these Iwo agencies is now authorized 10 regulate. restr:t, or prohibit access to limiled access/acilifies

Uncr Section 1 of EO 546, the Ministry of Public Works (now DPWH) assumed theJUhlic works functions of the Ministry of Public Works, Transportation and CO.1munications. On the other hand, among the functions of the Ministry of Trnsportation and Communications (now Department of Transportation and Cmmunications [DOTC]) were to (I) formulate and recommend national pdicies and guidelines luI' the preparation and implementation or an integrated a.d comprehensive transportation and communications systems at the national. rgional, and local levels; and (2) regulate, when,ever necessary, activities relative '> transportation and communications and prbcribe and collect fees in the :xercise of such power. Clearly, under I~O 546, it is the DOTe, 110t the DPWI-l, which has authority to regulate, restrict, or prohibit access to limited access faeil ities.

Even under Executive Order No. 125 (EO 125i~:! and Executiw Order No. 125-A (EO 125-A)Y which further reorganized the DOTC, the authority to administer and enforce all laws, rules and regulations relative to transportation is clearly with the DOTC.:'6 - ' . .

Thus, DO 74 and DO 215 are void because the DPWH has no authority to declare certain expressways as limited access facilities. Under the law, it is the DOTe which is authorized to administer aoo enforce all laws, rules and regulations in the field of transportation anQjo regulate r~lated activities. ,

Since the DPWH has no authority to regulate activities relative to transportation, the TRB.2] cannot derive its power from the DPWH to issue regulations governing limited access facilities. The DPWH cannot delegate a power or function which it does not possess in the first place. Since DO 74 and DO 215 are void, it follows that the rules implementing them are likewise void."

18.Similarly, in "Apex Mining vs. Southeast Mindanao Gold mining Corp.

et al", GR No. 152628 dated 23 June 2006, it was held:

"The Court of Appeals theorizes that DAO No. 66 was issued beyond the power of the DENR Secretary since the power to withdraw lands ti'ol1l forest reserves and to declare the same as an area open for mining operation resides in the President.

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However~ a subsequent law, Commonwealth Act No. 137, otherwise known as "The Mining Act" which was approved on 7 November 1936 provides:

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Sec. 14. Lands within reservations for purposes other than mining, which, after sllch reservation is made, are found to be more valuable for their mineral contents than for the purpose for which the reservation was made, may be withdrawn from such reservations by the President with the concurrence of the National Assembly, and thereupon such lands shall revert to the public domain and be subject to disposition under the provisions of this Act.

Unlike Proclamation No. 369, Commonwealth Act No. 137 vests solely in the President, with the concurrence of the National Assembly, the power to withdraw forest reserves fOllnd to be more valuable for their mineral contents than for the purpose for which the reservation was made and convert the same into non-forest reserves. A similar provision can also be found in Presidential Decree No. 463 dated 17 May 1974, with the modifications that (1) the declaration by the President no longer requires the concurrence of the National Assembly and (2) the DENR Secretary merely exercises the power to recommend to the President which forest reservations are to be withdrawn from the coverage thereof. Section 8 of Presidential Decree No. 463 reads:

SEC. 8. Exploration and Exploitation of Reserved Lands. When lands within reservations, which have been established for purposes other than mining, are found to be more valuable for their mineral. contents, they may, upon recommendation of the Secretary be withdrawn from such reservation by the President and established as a mineral reservation.

Against the backdrop of the applicable statutes which govern the issuance of DAO No. 66, this Court is constrained to rule that said administrative order was issued not in accordance with the laws. Inescapably, DAO No. 66? declaring 729 hectares of the areas covered by tlLe Agusan-Davao-Surigao Forest Reserve as

. non-forest land open to small-scale mi ... ning operations, is null and void as, verily, the DENR Secretary has' no power to convert forest reserves into non-forest reserves. "

19.In "RCPI vs. NTC et al.", GR No.93237 dated 6 November 1992, it was

held that:

"No substantial change has heen brought about by Executive Order No. 546 invoked by the Solicitor General's Onice to bolster NTC's jurisdiction. The Executive Order is not an explicit grant or power to impose administrative lines on public service utilities, including telegraphic agencies, which have failed to render adequate service to consumers. Neither has it expanded the coverage of the supervisory and regulatory power of the agency. There appears to be no alternative but to reiterate the settled doctrine in administrative law that:

Too basic in administrative law to need citation of jurisprudence is the rule that iurisdiction and powers of administrative agencies, like respondent Commission, are limited to those expressly granted or necessarily implied from those granted in the legislation creating such body; and any order without or heyond sllch jurisdiction is void and ineffective ... (Globe Wireless case, supra).

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WHEREFORE, the decision appealed from is REVERSED and SET ASIDE for lack of jurisdiction of the NTC to render it. The temporary restraining order

. issued on 18 June 1990 is made PERMANENT without prejUdice, however, to the filing by the party aggrieved by the conduct of RCP(' of the proper action in the proper forum. No costs."

20.Respondent is a member of the TAC-Tobacco. Respondent's role therein

is to implement the Tobacco Regulation Act of 2003, not to supplant it.

21.Thus, in a similar case involving milk products entitled "Pharmaceutical

and Health Care Association of the Philippines vs. Health Secretary

Francisco Duque TIT, et al.", OR No. 173034 dated 09 October 2007, the

Supreme Court held:

"However, Section 11 of the RIRR, to wit:

SECTION 11. Prohihition - No advertising, promotions, sponsorships, or marketing materials and activities for breastrnilk substitutes intended for infants and young children up to twenty-four (24) months, shall be allowed, because they tend to conveyor give subliminl;!l messages or impressions that undermine breastmilk and breastfe~rig or oth~rwise exaggerate breastmilk substitutes and/or replacements, as well as related products covered within the scope of this Code. .

prohibits advertising, promotions, sponsorships or marketing materials and actIVIties for breastmilk substitutes in line with the RIRR's declaration of principle under Section 4(t), to wit:

SECTION 4. Declaration (?lPrinciples

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(f) Advertising, promotions, or sponsorships of infant formula, breastmilk substitutes and other related products are prohibited.

The DOH; through its co-respondents, evidently arrogated to itself not only the regulatory authority given to the lAC but also imposed absolute prohibition on advertising, promotion, and marketing.

Yet, oddly enough, Section 12 of the RIRR reiterated the reqlliremen~ of the Milk Code in Section 6 thereof for prior approval by lAC of all advertising, marketing and promotional materials prior to dissemination.

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Even respondents, through the OSG, acknowledged the authority of lAC and repeatedly insisted, during the oral arguments on June 19, 2007, that the prohibition under Section 11 is not actually operational, viz:

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Sections 11 and 4(1) of the RIRR are clearly violative of the Milk Code.

However, although it is the lAC which is authorized to promulgate rules and regulations for the approval or rejection of advertising, promotional, or other marketing materials under Section 12(a) of the Milk Code, said provision must be related to Section 6 thereof which in turn' provides that the rules and regulations must be "pursuant to the applicable standards provided for in this Code." Said standards are set forth in Sections 5(b), 8(b), and 10 of the Code, which, at the risk of being repetitious, and for easy reference, are quoted hereunder:

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Thus, the DOH has the significant responsibility to translate into operational terms the standards set forth in Sections 5, 8, and 10 of the Milk Code, by which the lAC shall screen advertising, promotional, or other marketing materials."

22.Administrative Order No. 2010-0013 was issued in violation of existing

law - the Tobacco Regulation Act of 2003.

23.It seeks to amend o~ ev~ make ne"w law, an act which is beyond the

power of respondent.

24.Administrative Order No. 2010-0013 compels petitioner to change the

labels of its products by incorporating therein graphic illustrations (Par.

V [A]) and removing from the labels various descriptors (Par. V [8]),

with penalty impositions for failure to do so (Par. VII).

25.This is contrary to the mandate of the Tobacco Regulation Act of 2003,

palticularly Section 13 (g) that provides:

"No other printed warnings, except the health warning and the message required in this Section, paragraph F shall be placed on cigarette packages."

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26.Article 7 of the Civil Code of the Philippines provides:

"Administrative or executive acts, orders and regulations shall be valid only when they are not contrary to the Jaws or the constitution."

27. In an En Banc Resolution of the Supreme Court in A.M. No. 03-9-02-SC

. entitled "Re: Entitlement to Hazard Pay of SC Medical and Dental Clinic

Personnel" dated 28' November 2008, the Department of Health

Administrative Order No. 2006-0011 was struck down as follows:

"To be sure, the law and the implementing rules obviously prescribe the minimum rates of hazard pay due all health workers in the government, as in fact this is evident in the self-explanatory phrase "at least" used in both the law and the rules. No compelling argument may thus be offered against the competence of the 0011 to prescribe, by rules or orders, higher rates of hazard allowance, provided that the sallie 1~1I1 within the limits of the law. As the lead agency in the implementation of the provisions of R.A. No. 7305, it has in fact been invested with such power by Section 35.' Be that us it may. the question that arises is whether that power is broad enough to vest the DOH with authority to fix an exact amount of hazard pay accruing to public health workers with Salary Grade 20 and above, deviating from the 5% monthly salary benchmark prescribed by both the law and its implementing rules. _-.

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The DOH possesses no such power.

Fundamental is the precept in administrative law that the rule-making power delegated to an administrative agency is limited and defined by the statute conferring the power. For this reason, valid objectiolls to the exercise of this power lie where it conflicts with the authority granted by the legislature.

A mere fleeting glance at A.O. No. 2006-0011 readily reveals that the DOH, in issuing the said admin'istrative order, has exceeded its limited power of implementing the provisions of R.A. No. 7305. It undoubtedly sought to modify the rates of hazard pay and the mechanism for its allocation under both the law and the implementing rules by prescribing a uniform rate-let alone a fixed and exact amount-of hazard allowance for government health workers occupying positions with salary grade 20 and above. The effect of this measure, can hardly be downplayed especially in'view of the unmistakable import of the law to establish a scalar allocation of hazard allowances among public health workers within each of the two salary grade brackets.

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I-Ience, it can only be surmised that the issuance of AO No. 2006-0011 is an attempt to amend the rates of hazard allowance and the mechanism for its allocatil)n as provided for in R.A. No. 7305 and the ili1plementing rules because it has the effect of obliterating the intended discrepancy in the cash equivalents of the hazard allowance for employees falling within the bracket of Salary Grade 20 and above. Without ullnecessarily

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belaboring this point, the COllrt finds that the administrative order violates the established principle that administrative issuances cannot amend an act ofCongress.'= It is void on its face, but only insofar as it prescribes a predetermined exact amount in cash of the hazard allowance for public health workers with Salary Grade 20 and above.

Indeed, when an administrative agency enters into the exercise of the specific power of implementing a statute, it is bOllnd by what is provided for in the same legislative enactment'~ inasmuch as i!s rule-making power is a delegated legislative power which may not be used either to abridge the authority given by the Congress or the Constitution or to enlarge the power beyond the scope intended.2'i The power may not be validly extended by implication beyond what may be necessary for its just and reasonable execution.'" In other words, the function of pronllllgating rules and regulations may be legitimately exercised only for the purpose of carrying out the provisions of a law, inasmuch as the power is confined to implementing the law or putting it into effect. '; Therefore, such rules and regulations. mllst not be inconsistent with the provisions of existing laws, particularly the statute being administered and implemented by the agency concerned, that is to say, the statute to which the issuance relates. Constitutional and statutory provisions control with respect to what rules and regulations may be promulgated by such a body, as well as with respect to what fields are su~iect to regulation by it. l

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It mtlst be stressed that the DOH issued the rules and regulations implementing the provisions of R.A. 7305 pursuant to the authority expressly delegated by Congress. Hence, the DOH, as the delegate administrative agency, cannot contravene the law from which its rule-making authority has emanated. As the cliche goes; the spring cannot rise higher than its source.,l In this regard, Fisher observes:

x x x The often conn icting and ambiguous passages within a law mllst be interpreted by executive officials to construct the purpose and intent of Congress. As important as intent is the extent to which a law is carried out. President Taft once remarked, "Let anyone make the laws ,of the country, it! can construe them."

~ ., ,

To carry out the laws, administrators issue rules and regulations of their own. The courts long ago appreciated this need. Rules and regulations "must be received as the acts of the executive, and as such, be binding upon all within the sphere of his legal and constitutiOl;al authority. Current law authorizes the head of an executive department or military department to prescribe regulations "for the government of his department, the conduct of its employees, the distribution and performance of its business, and the custody, lise, and preservation of its records, papers, and property.

These duties, primarily of a "housekeeping" nature, relate only distantly to the citizenry. Many regulations, however, bear directly on the public. It is here that administrative legislation must be restricted in its scope and application. Regulations are not supposed to be a substitute for the general policymaking that Congress enacts in the form of a public law. Although administnltive regulntions ,u'e entitled to respect, the authority to prescribe rules and regulations is not an independent source of power to m~lke hlWS. Agency rulemaking mtlst rest on authOl'ity granted directly or indirectly by Congress.' (Emphasis supplied)

Moreover, although an adplinislralive agency is aUlhorized to exercise its discretion in the exercise of its power of subordinate legislation, nevertheless, no similar authority exists to validate an arbitrary or capricious enactment of rules and regulations.'" Rules which have the effect or extending or conflicting with the authority-granting statute do not represent a valid exercise of rule-making power but constitute an attempt by the agency to legislate. In Stich a situation, it is said that the issuance becomes void not only

15

for being ultra }lires but also for being unreasonable. 10 The law therefore prevails over the administrative issuance.;" .

The Court takes notice of the fact that the enactment of R.A. No. 7305 has touched off, within the pubiic health service sector, a surge of negative sentiments regarding the alleged inequitableness and unfairness of the law-particularly the provisions thereof relating to the allocation of hazard allowances. Certainly, the DOH can be reasonably expected to respond to the well-meaning clamor of the public health workers; but while indeed the DOH is entitled to a certain amollnt of hegemony over the statutes which it is tasked to administer, it nevertheless may not go far beyond the letter of the law even if it does perceive that it is acting in the furtherance of the spirit of the law.

A final note. Just as the power of the DOH to issue rules and regulations is confined to the clear letter of the law, the Court's hands are likewise tied to interpreting and applying the law. In other words, the Court cannot infuse vitality, let alone a semblance of validity, to an issuance which on its face is inconsistent \":'ith the law and therefore void, by adopting its terms and in effect implementing the same-lest we otherwise validate an undue exercise by the DOH of its delegated and limited power of implementation. Suffice it to say that questions relative to the seeming unfairness and inequitableness of the law are matters that lie well within the legitimate powers of Congress and are well beyond the competence of the Court to address."

28.In "Review Center Association of the Philippines vs. Executive Secretary

Eduardo Ermita et al.", GR No.180046, dated 02 April 2009, the

Supreme Court held:

"The President has no inherent or delegated legislative power to amend the functions of the CHED under RA 7722. Legislative power is the authority to make laws and to alter or repeal them,3:! and this power is vested with the Congress under Section 1, Article VI of the 1987 Constitution which states:

Section I. The legislative power shall be vested in the Congress of the Philippines which shall consist of a Senate and a House of Representatives, except to the extent reserved to the people by the provision on initiative and referendum.

In Op/e v. Torres,33 the Com1 declared void, as a usurpation of legislative power, Administrative Order No. 308 (AO 308) issued by the President to create a national identification system. AO 308 mandates the adoption of a national identification 'system even in the absence of an enabling legislation. The Court distinguished between Legislative and Executive powers, as follows:

The line that delineates Legislative and Executive power is not indistinct. Legislative power is "the authority, under the Constitution, to make laws, and to alter and repeal them." The Constitution, as the will of the peoph: in lheir original, sovereign and unlimited capacity, has vested this power in the Congress of the Philippines. The grant of legislative power to Congress is broad, general and comprehensive. The legislative body possesses plenary power for all purposes of

16

civil government. Any power, deemed to be legislative by usage and tradition, is necessarily possessed by Congress, unless the Constitution has lodged it elsewhere. In fine, except as limited by the Constitution, either expressly or impliedly, legislative power embraces all su~jects and extends to matters of general concern or common interest.

While Congress is vested with the power to enact laws, the President executes the lows. The executive power is vested in the President. It is generally defined as the power to enforce and administer laws. It is the power of carrying the laws into practical operation and enforcing their due observance.

As head of the Executive Department, tne President is the -Chief Executive. He represents the government as a whole and sees to it that all laws are enforced by the officials and employees of his department. He has control over the executive department, hl~reaus and'offices. This means that he has the authority to assume directly the functions of the executive department, bureau and office, or interfere with the discretion of its officials. Corollary to the power of control, the President also has the duty of supervising the enforcement of laws for the maintenance of general peace and public order. Thus, he is granted atiministratil'e power over bureaus and offices under his control to enable him to discharge his duties effectively.

Adminislratil'e power is concerned with the work (!l ajJf7~I)ill~ policies and enjiJrcing orders as determined hy proper governmental OIxans. It enahles Ihe President to.fix a un(tiJr111 standard (~l administrative efficiency and check the (~tficial condllct (?l his a~ents. To this end, he can issue administrative orders. rules and regulations.

x x x . . ,

An administrative order is:

"Sec. 3. Administrative Orders. - Acts of the President which relate to particular aspects of governmental operation in pursuance of his duties as administrative head shall be promulgated in administrative orders."

An administrative order is an ordinance issued by the President which relates to specific aspects in the administrative operation of government. It mllst be in harmony with the law and should hejhr the sole purpose (?limplementing the law and canying ow the le~islalive policy. x x x:''{

Just like AO 308 in Ople v. Torres, EO 566 in this case is 110t supported by any enabling law. The Court further stated in Ople:

x x x. As well stated by Fisher: "x x x Many regulations however. hear directly on Ihe public. It is here that administrative legislalim1 must he restricted in its scope and application. Regulations are not supposed to he u suhs/ill/le fiJr the general policy-making thaI Congress enacts in the form (?( a puhlic law. Although administrative regulations are entitled to respect, the authorit), 10 prescrihe rilles and regulations is not an independent source olpower 10 make lall's. ,,35

17

Since EO 566 is an invalid exercise of legislative power, the RIRR is also an invalid exercise of the CHED's quasi-legislative power.

Administrative agencies exercise their quasi-legislative or rule-making power through the promulgation of rules and regulations.36 The CHED may only exercise its rule-making power within the confines of its jurisdiction under RA 7722. The RIRR covers review centers and similar entities which are neither institutions of higher education nor ins,titutions offering degree-granting programs."

29.1n "Land Bank vs. Court of Appeals", GR No. 118712 dated 06 October

1995, it was held that:

"Anent the first assignment of error, petitioners maintain that the word "deposit" as used in Section 16( e) of RA 6657 referred merely to the act of depositing and in no way excluded the opening of a trust account as a form of deposit. Thus, in optil'lg for the opening of a trust account as the acceptable form of deposit through Administrative Circular No.9, petitioner DAR did not commit any grave abuse of discretion since it merely exercised its power to promulgate rules and regulations in implementing the declared policies ofRA 6657.

The contention is untenable. Section 16(e) of RA 6657 provides as follows:

Sec. 16. Procedure for Acq LI isition of Private Lands --"':-

., xxx xxx xxx

(e) Upon receipt by the landowner of the corresponding payment or, in case of rejection or no response from the landowner, upon the deposit witli an accessihle hank designated hy the DAR (?lthe compensation in cash or ill LBP honds in accordance with this Act, the DAR shall take immediate possession of the land and shall request the p'roper Rcgister of Deeds to issuc a Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines .... (emphasis supplied)

It is very explicit therefrom that the deposit must be made only in "cash" or in "LBP bonds". Nowhere does it appear nor can it be inferred that the deposit can be made in any other form. If it were the intention to include a "trust account" among the valid modes of deposit, that should have been made express, or at least, qualifying words ought to have appeared from which it can be fairly deduced that a "trust account" is allowed. In sum, there is no ambiguity in Section 16(e) of RA 6657 to warrant an expanded construction of the term "deposit".

The conclusive effect of administrative construction is not absolute. Action of an administrative agency may be disturbed or set aside by the judicial department if there is an, error of law, a grave abuse of power or lack of jurisl.liction or grave abuse of discretion clearly conflicting with either the letter or the spirit or (I

legislative enactment. 18 In this regard, it must be stressed that the function of promUlgating rules and regulations may be legitimately exercised only for the

18

purpose of carrying the provIsions of the law into effect. The power· or administrative agencies is thus confined to implementing the law or putting it into effect. Corollary to this is that administrative regulations cannot extend the law and amend a legislative enactment, 19 for settled is the rule that administrative regulations must be in harmony with the provisions of the law. And in case there is a discrepancy between the basic law and an implementing rule or regulation, it is the former that prevails. 20 ..

In the present suit, the DAR clearly overstepped the limits of its power to enact rules and regulations when it issued Administrative Circular No.9. There is no basis in allowing the opening of a trust account in behalf of the landowner as compensation for his property because, as"heretofore discussed, Section 16(e) of RA 6657 is very specific that the deposit must be made only in "cash" or in "LBP bonds". Tn the same vein, petitioners cannot invoke LRA Circular Nos. 29, 29-A and 54 because these implementing regulations cannot outweigh the clear provision of the law. Respondent court therefore did not commit any error in striking down Administrative Circular No.9 for being null and void."

30.ln "Conte vs. the COA", OR NO.116422 dated 04 November 1996, it was

held that:

"We are not unmindful of the laudable purposes for promulgating Res. 56, and the positive results it must have had, not only in reducing costs and expenses on the part of the SSS in connection with the pay-out or retirement benclits and gratuities, but also in improving, the quality oflife for scores of retirees. But it is simply beyond dispute that the SSl; had no aiHhority to maintain and implemelit sLlch retirement plan, particularly in the face of the statutory prohibition. The SSS cannot, in the guise ofrule-making, legislate or amend laws or worse, render them nugatory.

It is doctrinal that in case of conflict between a statute and an administrative order, the former must prevail. I" A rule or regulation must conform to and be consistent with the provisions of the enabling statute in order for such rule or regulation to be valid. ". The rule-rpaking power of a public administrative body is a delegated legislative power, which it may not use either to abridge the authority given it by the Congress or the Constitution or to enlarge its power beyond the scope intended. Constitutional and statutory provisions control with respect to what rules and regulations may be promulgated by such a body, as well as with respect to what fields are subject to regulation by it. It may not make rules und regulations which are inconsistent with the provisions of the Constitution or a statute, particularly the statute it is administering or which created it, or which an~ in derogation ot: or defeat, the purpose of a statute. 1 Though well-settled is the rule that retirement laws are liberally interpreted in favor of the retiree, " neveltheless, there is really nothing to inlef1Jret in either RA4968 or Res. 56, and correspondingly, the absence of any doubt as to the ullra-vires nature and illegality of the disputed resolution constrains us to nile against petitioners."

19

31. Labels of cigarette products are proprietary In nature. These are

registered trademarks and/or copyrighted.

32.Petitioner creates, develops and uses these marks and appropriates the

same in accordance with law. Petitioner incurs expenses to create and

protect their labels, the design, the marks therein placed, and the

description of the products it is selling. The labels of its products are

petitioner's property.

33.A regulation of this right to property or deprivation· of such right must

perforce be reasonable and pass through congress.

34.Respondentcannot, in the guise of regulatory making power, deprive

petitioner of its proprietary rights.

35.Respondent failed to observe due process In the Issuance of

Administrative Order,No~Ol o-ooT\, ,

36.Administrative Order No. 2010-0013 clearly curtails petitioner's right to

property.

37.At the very least, prudence dictates that petitioner be heard prior to the

issuance of the administrative order.

38.However, respondent never called a hearing or even asked the views of

affected parties such as petitioner on the matter.

39.In "Manila International Airport Authority vs. Blancatlor", GR

NO.157581 dated 0 I December 2004, it was held:

"To conclude, petitioner's Resolutions Nos. 98-30 ;md 99-11 and the corresponding administrative orders, which increased the fees, charges, and rates

20

· " "'.' ." -.. -~~- .-.~-.-.---.---

.... ,--~-.. ~ "--.~- ..

specified therein, without the required prior notice and hearing as well as approval of the DOTC Secretary, are null and void. The RTC Decision, which permanently enjoined. petitioner from collecting said increases and ordered refund to respondents of the amounts paid pursuant to the said Resolutions, must be upheld. However, any refund should cover only the differential brought about by the unauthorized increases contained in said Resolutions.

In our view, considering the clear mandate of the applicable' provisions of law, petitioner's theory that its fees, charges, and rates are contractual in nature and thus, respondents are free to terminate the lease contracts should they be unable to pay the increased dues is unacceptable. As the country's principal airport for both international and domestic air transport; petitioner's properties, facilities, and services are imbued with paramount public and even national interest. Petitioner is not at liberty to increase fees, charges, or rates at will, without due regard to parameters set by laws and regulations. Among the considerations mentioned in E.O. No. 903 are that fees and charges should reflect adequately the costs and increases in price levels and the volume of traffic. For any change in its fees, charges, or rates without due regard to valid limitations can create a profound impact on the country's economy in general and air transport in particular."

40.ln "Hon. Renato C. Corona et at. vs. United Harbor Pilot's Association of

the Phil.et al.", GR No. 111953 dated 12 December 1997, it was held

that:

::ti.. ., "After carefully examining'the records and deliberating on the arguments of the parties, the Court is convinced that PPA~AO No. 04-92 was issued in stark disregard of respondents' right against deprivation of property without due process of law. Consequentl.y, the instant petition must be denied.

Section I. of the Bill bf Rights lays down what is known as the "due process clause" of the Constitution, viz.:

Sec. I. No person shall be deprived of life, liberty, or property without due process of law, ...

In order to fall within the aegis of this provision, two conditions must concur, namely, that there is a deprivation and that such deprivation is done without proper observance of due process. When one speaks of due process of law. however, a distinction must be made between matters of procedure and matters of substance. In essence, procedural due process "refers to the method or manner by which the law is enforced," while substantive due process "requires that the law itself, not merely the procedlll'es by which the law would be enforced, is fair, reasonable, and just." 14 PPA~AO No. 04-92 must be examined in light of this distinction.

xxx

21

There is no dispute that pilotage as a profession has taken on the nature of a property right. Even petitioner Corona recognized this when he stated in his March 17, 1993, decision that "(t)he exercise of one's profession falls within the constitutional guarantee against wrongful deprivation ot: or interference with, property rights without due process." 20 He merely expressed the opinion the "(i)n the limited context of this case, PPA-AO 04-92 does not constitute a wrongful interference with, let alone a wrongful deprivation of, the property rights of those affected thereby, and that "PPA-AO 04-95 does not forbid, but merely regulates, the exercise by harbor pilots of their profession." As will be presently demonstrated, such supposition is gravely erroneous and tends to perpetuate an administrative order which is not only unreasonable but also superfluous.

Pilotage, just like other professions, may be practiced only by duly licensed individuals. Licensure is "the granting of license especially to practice a profession." It is also "the system of granting lieenses (as for professional practice) in accordance with establishment standards." 21 A license is a right or permission granted by some competent authority to carryon a business or do an act which, without such license, would be illegal. 22

xxx

Their license is granted in the form of an appointment which· allows them to engage in pilotage until they retire at the age 70 years. This is a vested right. Under the terms of PPA-AO No. 04-92, "(a)11 existing regular appointments which have been previo~sly issued by the Bureau of Customs or the PP A shall remain valid up to 31 December 1992 only," and "(0)11 appointments to hnrbor pilot positions in all pilotage districts shall, henceforth, be only for a term of one (1) year from date of elJectivitY,.,subject to renewal or cancellation by the Authority after conduct o~ rigid evalll!i1tion of performance." ,

It is readily apparent that PPA-AO No. 04-92 unduly restricts the right of harhor pilots to enjoy their profession before their compulsory retirement. In the past, they enjoyed a measure of security knowing that after passing live examinations and undergoing years of on-the-job training, they would have a license which they could use until their'retirement, unless sooner revoked by the PPA tor mental or physical unlitness. Under the new issuance, they have to contend with an annual cancellation of their license which can be temporary or permanent depending on the outcome of their performance evaluation. Veteran pilots and neophytes alike are suddenly confronted with one-year terms which ipso/acto expire at the end of that period. Renewal of their license is now dependent on a "rigid evaluation or performance" which is conducted only after the license has already been cancelled. I-knce, the use of the term "renewal." It is this pre-evaluation cancellation which primarily makes PPA-AO No. 04-92 unreasonable and constitutionally infirm. In a real sense, it is a deprivation of property without due process oflaw."

41.Finally, there is no law that authorizes respondent to issue Administrative

Order No. 2010-0013.

22

42.Respondent's on1y basis is the Framework Convention on Tobacco

Control initiated by the World Health Organization. But this is not 1aw.

43.In "Pharmaceutical and Health Care Association of the Philippines vs.

Health Secretary Francisco Duque III, et al. GR No. 173034 dated 09

October 2007, the Supreme Court held:

"The former Senior Legal OfJicer of WHO, Sami Shubber, stated that WHA recommendations are generally not binding, but they "carry moral and political weight, as they constitute the judgment on a health issue of the collective membership of the highest international body in the field of health.,,:!9 Even the ICMBS itself was adopted as a mere recommendation, as WHA Resolution No. 34.22 states:

"The Thirty-Fourth World Health Assembly x x x adopts, in the sense of Article 23 of the Constitution, the International Code of Marketing of Breastmilk Substitutes annexed to the present resolution." (Emphasis supplied)

The Introduction to the ICMBS also reads as follows:

In January 1981, the Executive Board of the World Health Organization at its sixty-seventh session, considered the fourth draft of the code, endorsed it, and unanimously recommended to the rmrty-fourth World Health Assembly the text of a resolution by which ihvould adop(the code in the form of a recommendation rather than a regulation. x x x (Emphasis supplied) ,

The legal value of WHA Resolutions us recommendations IS summarized 111

Article 62 of the WHO Constitution, to wit:

Art. 62. Each member shall report annually on the action taken with respect to recommendations made to it by the Organization, and with respect to conventions, agreements and regulations.

Apparently, the WHA Resolution adopting the ICMBS and subsequent WHA Resolutions urging member states to implement the ICMBS are merely recommendatory and legally non-binding. Thus, unlike what has been done with the ICMBS whereby the legislature enacted most of the provisions into law which

, is the Milk Code, the subsequent WHA Resolutiol1s,30 specifically providing for exclusive breastfeeding from 0-6 months, continued breastfeeding up to 24 months, and' absolutely prohibiting advertisements and promotions of breastmilk substitutes, have not been adopted as a domestic law.

xxx

· .' ':.

It must be emphasized that even under such an international emergency, the duty of a state to implement the IHR Resolution was still considered not binding or enforceable, although said resolutions had great political influence.

As previously discussed, for an international rule to be considered as customary law, it must be established that such rule is being followed by states because they consider it obligatory to comply with such rules (opinio juris). Respondents have not presented any evidence to prove that the WHA Resolutions, although signed by most of the member states, were in fact enforced or practiced by at least a majority of the member states; neither have respondents proven that any compliance by member states with said WHA Resolutions was obligatory \11

nature.

Respondents failed to establish that.the provisions of pertinent WHA Resolutions are customary international law that may be deemed part of the law of the land.

Consequently, legislation is necessary to transform the provisions of the WHA Resolutions into domestic law. The provisions of the WHA Resolutions cannot be considered as part of the law of the land that can be implemented by executive agencies without the need of a law enacted by the legislature."

44.1t is therefore patent that Administrative Order No. 2010-0013 is null and

void.

APPLIC4.T10N FO,R INJUNCTION ,

45.0n 10 June 2010, Administrative Order No. 2010-0013 became effective.

The grace period granted by the said order will expire on 08 September

2010.

46.The enforcement of the said order will surely work injustice to petitioner.

47.Petitioner is placed in a predicament in that if it does not follow

respondent's Administrative Order No. 1010-0013, it will be penalized.

48.0n the other hand, if petitioner follows respondent's order, it will be

violating the Tobacco Regulation Act of2003, particularly Section 13 (g)

thereof, thereby subjecting it to penalties under Section 32 of the Act.

24

49.This is basically a "damned if you do, damned if you don't" situation.

50.Petitioner's property rights are likewise curtailed in violation of its right

to due process ad right to property.

51.Petitioner is entitled to the relief demanded and part of such relief is to

enjoin respondent from implementing and enforcing Administrative

Order No. 2010-0013.

52.If the implementation and enforcement is not enjoined forthwith, the

same will cause irreparable damage and injury to petitioner, whose

officers may be imprisoned for violations of either the Administrative

Order or the existing Tobacco Regulation Act and its property rights and

goodwill that petitioner painstakingly developed may be destroyed in an

instant. Its implementation and enforcement likewise constitute a

continuous violation of p~tioner's""'c~;)J1stitutional rights.

53.Petitioner is able and willing to post a bond in an amount determined by

. the Court to answer for any and all damages that respondent may suffer

by reason of the injunction, if one be issued and later determined as

Improper.

PRAYER

WHEREFORE, petitioner respectfully prays that:

1. Upon filing of the petition, that its application for prel iminary injunction

be immediately set for hearing;

25

2. Upon hearing of the application for preliminary injunction, a Writ of

Preliminary Injunction be issued enjOIning respondent from

implementing and enforcing Administrative Order No. 2010-0013;

3. And thereafter, to declare Administrative Order No. 2010-0013 null and

void.

Other relief just or equitable is likewise prayed for.

Makati City, 23 June 2010.

TENG & CRUZ LAW OFFICES 7th Floor, PDCP Bank Centre Bldg.

V. A. Rufino cor. Leviste Streets Salcedo Village,Makat' City

BY:C G, . GARCRUZ

PTR No.208 967MB; 01/04/10; Makati Lifetime Membership IBP No. 00581

~ -~ ~01l of Attorneys No. 35778 MCLE Compliance No. III-ODI5878; 04/2311 0

Copy furnished:

Office of the Solicitor General 134 OSG Building Amorsolo Street, Legaspi Village Makati City

;Petillon doc

26

VERIFICATION AND CERTIFICATION OF NON-FORUM SHOPPING

I, ANTONIO B. YAO, of legal age, Filipino, with address at Km. 14

South Superhighway, Parafiaque City, after having been duly sworn in

accordance with law, depose and state:

1. TELENGTAN BROTHERS & SONS, INC., doing business under the name and style LA SUERTE CIGAR AND CIGARETTE FACTORY, of which I am the Vice President-Operations, is the petitioner in the above-captioned case.

2. The company, through myself, caused the preparation of the said petition and the contents thereof are true and correct to the best of my knowledge or based on authentic records.

3. The company has not caused the filing of a similar action involving the same parties or issues before the Supreme Court, the Court of Appeals or in any other tribunal or body.

4. In the event that such a similar action is brought to our knowledge, I undertake to inform this Honorable Court of such fact within five (5) days from notice thereof

Telengtan Brothers & Sons, Inc.

J SUBSCRIBED and SWORN before me this ~th day of \Jy).-<..., ?-OlD, affiant exhibiting to me his Community Tax Certificate

No. 33217975, issued at Parailaque G~~~

Doc. No. ~ ()O ; MAR CRUZ. O COMMISSION No. 321

Page No. '$'" ; "IJTAlYPUlLIC-CITY OF MAKATt Book No. ?11 " UtfTft,. DECEMes. 3L 20.

~ ,; ': ::. 81..\7(;., "FINO .. I.UNT. Series of 20 10. . ~1\"CID&VH.l .. M"K~TI CITY

'. • .... : ... "f!"~'1 • U-=eTIME

~Tt "f'1''''''U8''~'' . /ventication doc

. '

REPUBLIC OF THE PHILIPPINES) MAKA TI CITY )S.S.

SECRETARY'S CERTIFICATE

L ELGAR CRUZ, of legal age, Filipino and with ornee address at 7C ill Floor, POCP Bank Center Building, V. A. Rulino cor. L. P. Leviste Street, Salcedo Village. Makati City. being the duly elected and qualified Corporate Secretary of TEL ENG TAN BROTHERS & SONS, INC. (doing business under the style of La Suerte Cigar & Cigarette Factory), under oath. do hereby certity the adoption on 04 June 2010 of the following resolutions, to wit:

"RESOLVED AS IT IS HEREBY RESOLVED, that the corporation's Vice President-Operations, MR. ANTONIO B. YAO, be as he is hereby authorized 1.) To institute for the Corporation a complaint or petition against the Department of Health to question the validity of Administrative Order no. 2010-0013 dated 12 May 2010, 2.) to sign the veritlcation and eertit1eation of non forum shopping of the complaint/petition and 3.),. to sign and execute the Special Power of Attorney granted to TENG ~ND CROZ LAW OFFICES or any of its lawyers in the case against the Department of Health, granting them full and special power of attorney the following powers:

a. To negotiate, conclude, enter into and execute a compromise or amicable settlement of the case, under such terms and conditions as the attorney-in-fact may deem just and reasonable;

b. To agree on the simplit1cation of the issues; ,

c. To amend the pleadings;

d. To obtain stipulations or admissions of fact and documents to avoid unnecessary proof;

e. To limit the number of witnesses;

[ To undertake a preliminary reference of Issues to a COlTIlTIlSSlOner;

g. To do and agree on such other matters as may aid in the prompt disposition of the action, and

h. To represent and to act lor and on behalf of the corporation, to sign, execute, file, submit and deliver any and all

' ...... ,':.

2

documents that may be required to put the foregoing resolution into effect."

IN WITNESS WHEREOF, I have affixed my signature hereto this 24th dav of June 2010 in Makati Citv. . ~

SlIBSCRIBED AND SWORN to before me this 24th of June 2010, affiant exhibiting to me his competent evidence of identilication in the form of CTC No. 2863 1482MB, issued on 19 February 2010, issued at Makati City

Doc. No. 48; Page No. II; Book No. VIII; Series of 20 I O.

IS(!c cCM-SPA DOl ( dOL"

,.-., "

SPECIAL POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS:

TELENGTAN BROTHERS & SONS, INC. (doing business under the style of La Suerte Cigar & Cigarette Factory), herein represented by its Vice President­Operations, MR. ANTONIO B. YAO, of legal age, with office address at Km. 14 South Super Highway, Parafiaque City, do hereby name, constitute and appoint the law offices ofTENG & CRUZ, particularly Attorneys Emilio S. Teng and/or Elgar Cruz to be its lawful attorney-in-fact and representative, for it and in its name, place and stead, to prosecute, institute, defend, answer and/or oppose all actions and other legal proceedings and demands respecting the case filed against the Department of Health, before the Regional Trial Court of Parafiaque City or any other tribunal, with power to enter into an amicable settlement, to submit to alternative modes of dispute resolution, to enter into stipulations or admissions of facts and of documents and for such purpose to appear and represent it in all proceedings, especially at the pre-trial or preliminary conference of the above-captioned case, as well as to execute any and all documents in connection therewith, with authority to do and perform the following:

a. To negotiate, conclude, enter into and execute a compromise or amicable settlement of'the case, ufn:ler such terms and conditions as the attorney-in-fact maJ-deem just and reasonable;

b. To agree on the simplification of the issues;

c. To amend the pleadings;

d. To obtain stipulations or admissions of fact and documents to avoid unnecessary proof;

e. To limit the number of witnesses;

f. To undertake a preliminary reference of issues to a commissioner; and

g. To do and agree on such other matters as may aid in the prompt disposition of the action.

HEREBY GIVING AND GRANTING unto the said attorneys full power and authority whats<?ever requisite or necessary or proper to be done in and about the premises, as fully to all intents and purposes as it might or could lawfully do if personally present, and HEREBY RATIFYING AND CONFIRMING all that the said attorneys shall lawfully do or cause to be done under and by virtue of these presents.

2

) IN WITN.ESS WHEREOF. I have hereunto set my hand this~lh day of

\v -1 "'~ -:vV ~ 0 .

TELENGTAN BROTHERS & SONS, INC.

By:

ACKNOWLEDGMENT

REPUBLIC OF THE PHILIPPINES) MAKATI CITY )S.S.

BEF~E ME, a Notary Public, for and in Makati City, this ~day of \lJ'\"'(., \ U ,personally appeared Mr. Antonio B. Yao, exhibiting to me his

Community Tax Certificate No. 33217975, issl,led on February 16,2010, at Parafiaque City, known to me and to me known jo be the sallle person who executed the foregoing instrument and aeknowledged to me th'll the same is his own free act and deed.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my

ISI'A ",coria' DOH ~OlOdoc

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