Unincorporated Functions of the Government Digests

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UNINCORPORATED FUNCTIONS OF THE GOVERNMENT

ACCFA v. CUGCO

Agricultural

Credit andCooperative

Financing

Administration

Confederation of

Unions inGovernment

Corporations and

Offices

Petition: two separate appeals by certiorari; parties, except the CUGCO, are the same and

principal issues involved are related, one decision in these two cases

Petitioner: ACCFA

Respondent: ACCFA Supervisors’ Assoc., ACCFA Workers’ Assoc, and Court of Industrial

Relations

Ponente: Makalintal

Date: Nov 29, 1969

* ACCFA = was a government agency created under Republic Act No. 821, as amended. Its

administrative machinery was reorganized and its name changed to Agricultural Credit

Administration (ACA) under the Land Reform Code (Republic Act No. 3844). On the other hand,

the ACCFA Supervisors' Association (ASA) and the ACCFA Workers' Association (AWA),

hereinafter referred to as the Unions, are labor organizations composed of the supervisors and

the rank-and-file employees, respectively, in the ACCFA (now ACA).

FACTS:

1. G.R. No. L-21484- Sept 4, 1961 Collective bargaining agreement bet the Unions and the ACCFA (to be

effective one year from July 1, 1961)

- Few months after, unions protested against alleged violations of said agreement

- Oct 30, 1962 Unions, together with its mother union [CUGCO], filed complaint with the

Court of Industrial Relations [CIR] against ACCFA for alleged unfair labor practice

- CIR ruled against ACCFA

- ACCFA moves to reconsider but was turned down by CIR en banc, hence the appeal by

certiorari to SC

2. G.R. No. L-23605

- During pendency of abovementioned case, RA 3844 [Agricultural Land Reform Code]

required the reorganization of the ACCFA and changed its name to ACA

- Union filed a petition for certification election with the Court of Industrial Relations

praying that they be certified as the exclusive bargaining agents for the supervisors and

rank-and-file employees, respectively, in the ACA. Trial court agreed with this move

dated May 21, 1964.



- ACA filed in this Court a petition for certiorari with urgent motion to stay the CIR order

of May 21, 1964. This Court dismissed the petition for "lack of adequate allegations,"

but the dismissal was later reconsidered when the ACA complied with the formal

requirement stated in said resolution. As prayed for, this Court ordered the CIR to stay

the execution of its order.

ISSUE: WON CIR has jurisdiction to entertain the petition of the Unions for certification election

on the grounds that ACA performs proprietary functions

HELD: YES, ACA performs governmental functions

RATIO:

- Under Sec 3 of the RA 3844, the ACA was established to extend credit and similar

assistance to agriculture

- E.O. 75 placed ACA under the Land Reform Project Administration [which

implementation is, accdg to RA 3844, a governmental function]

- According to the Land Reform Code, the administrative machinery of the ACCFA shall be

reorganized to enable it to align its activities with the requirements and objective of this

Code and shall be known as the Agricultural Credit Administration. These include

powers not really accorded to non-government entities such as tax exemptions,

registration of deeds, notary services, and prosecution of officials.

- The power to audit the operations of farmers' cooperatives and otherwise inquire into

their affairs, as given by Section 113, is in the nature of the visitorial power of the

sovereign, which only a government agency specially delegated to do so by the Congress

may legally exercise.

- ACA was delegated under the Land Reform Project Administration, a government

agency tasked to implement land reform.

- Traditional classification of the functions of the government has been rendered bu the

complexity of modern society as obsolete. The function may not be strictly constituent

in the sense of Bacani case, but the compelling urgency with which the Constitution

speaks of social justice does not leave any doubt that land reform is not an optional

but a compulsory function of sovereignty (p. 46, Bernas).



PVTA v. CIR

Petition: appeal by certiorari

Petitioner: Philippine Virginia Tobacco Admin

Respondent: CIR et. al

Ponente: FernandoDate: 1975

FACTS:

- Dec 20 1966 private respondents filed with CIR a petition alleging employment

relationship in accordance with Commonwealth Act 444 [Eight Hour Labor Law]*

1. overtime services in excess of 8 hours

2. failure to pay overtime compensation

- Counter-argument of PVTA: exempt from CA 344 since it performs governmental

functions

- CIR voted against PVTA, hence this appeal to SC

*Sec. 1 of the CA 344 states “the legal working day for any person employed by another shall

not be of more than 8 hours daily”.

ISSUE: WON PVTA is exempt from CA 344 on the ground that it performs governmental

functions

HELD: YES (affirmed CIR’s decision)

RATIO:

- RA 2265 [AN ACT ESTABLISHING THE VIRGINIA TOBACCO ADMINISTRATION, DEFINING

ITS OBJECTIVES, POWERS AND FUNCTIONS, AND FOR OTHER PURPOSES] and RA 4155

[AN ACT TO PROMOTE AND STRENGTHEN THE VIRGINIA TOBACCO INDUSTRY] = proves

the nature of PVTA as a governmental agency

- Reiterated ratio in ACCFA case: traditional classification of the functions of the

government has been rendered by the complexity of modern society as obsolete.

- Expanded role of the government

- A reference to the pertinent sections of both Republic Acts 2265 and 2155 renders clear

the differentiation that exists. If as a result of the appealed order, financial burdenwould have to be borne by petitioner, it has only itself to blame. It need not have

required private respondents to render overtime service. It can hardly be surmised that

one of its chief problems is paucity of personnel. That would indeed be a cause for

astonishment. It would appear, therefore, that such an objection based on this ground

certainly cannot suffice for a reversal. To repeat, respondent Court must be sustained.



Republic v. Judge of CFI of Rizal

Petition: appeal by certiorari and mandamus with preliminary injunction; seeks to nullify and

set aside the orders of the judge in Jose Sison v. RCA

Petitioner: Republic of the Philippines

Respondent: Presiding Judge of CFI of Rizal (Barnch XV) and Jose SisonPonente: De Castro

Date: 1980

FACTS:

1. - April 11, 1970 Sison filed a complaint against the Rice and Corn Administration [RCA] for

a sum of money with the CFI of Rizal

- RCA filed a motion to dismiss on the ground of non-suability of the RCA as a mere

governmental agency

- May 5, 1970 Sison filed motion on to amend the complaint for the purpose of showing

his actionable interest as assignee of the purchase price of unpaid deliveries of corn

grains to RCA

- Again, RCA filed a motion to dismiss; judge denied

- September 22, 1970 RCA filed answer

- CFI ruled in favor of Sison

2. - May 24, 1972 RCA filed a notice of appeal as well as motion for extension of time of 30

days; CFI granted; RCA filed its record on appeal before the expiration

- Sison filed a motion to dismiss the appeal for the RCA’s failure to post an appeal bond

[amount of money placed in holding while the appeal is being decided]; RCA,

represented bu the Solicitor Gen, filed an opp- Judge approved RCA’s record on appeal; denying, however RCA’s exemption to pay legal

fees and posting of the appeal bond on the ground that RCA is a mere instrumentality of

the Republic of the Philippines

- Judge gave RCA 5 days to post an appeal bond

3. - RCA filed a motion for reconsideration, alleging they are exempt from posting an appeal

bond

- Sison filed a motion to dismiss the appeal on the ground of the petitioner’s refusal to file

the appeal bond

- Judge dismissed RCA’s appeal and ruled that RCA, being a mere instrumentality of the

Republic of the Philippines, is not exempt to pay legal fees and from posting of an

appeal bond

4. - Sison filed a motion for a writ of execution and approval of the bill of costs which was

opposed by RCA

- Judge issued for issuance of a writ of execution against the goods and chattels of the

RCA



- RCA filed an urgent motion to quash the writ of execution = still unresolved and pending

- RCA filed an appeal by certiorari and mandamus with preliminary injunction to SC

ISSUE: WON RCA is exempt from paying the legal fees and from posting an appeal bond on the

ground that it performs governmental functions

HELD: Yes, RCA performs governmental functions

RATIO:

- Legal character of RCA as a governmental agency had already been passed upon the

case of Ramos v. CIR:

- RA 3452 created RCA in pursuance of its policy to “stabilize the price of palay, rice

and corn, it shall engage in the 'purchase of these basic foods' directly from those

tenants, farmers, growers, producers and landowners in the Philippines who wish to

dispose of their produce at a price that will afford them a fair and just return for

their labor and capital investment and whenever circumstances brought about by

any cause, natural or artificial, should so require, shall sell and dispose of these

commodities to the consumers at areas of consumption at a price that is within their

reach”

- RCA is, therefore, a government machinery to carry out the aforementioned

government policy

- RCA = not possessed of separate and distinct corporate existence; officially under the

Office of the President

- Mercantile activity of RCA in the buying and selling of palay, rice, and corn is only

incident to its primary governmental function which is to carry out its declared policy of

subsidizing and stabilizing the price of palay, rice, and corn in order to make it well

within the reach of average consumers, an object obviously Identified with the primaryfunction of government to serve the well-being of the people

- As a governmental agency under the Office of the President = RCA exempt from the

payment of legal fees as well as the posting of an appeal bond

- Republic of the Philippines is exempt from the requirement of filing an appeal bond on

taking an appeal from an adverse judgment, since there could be no doubt, as to the

solvency of the Government

Notes: (GTZ v. CA, 2009)

1. An incorporated agency has a charter of its own that invests it with a separate juridical

personality, like the Social Security System, the University of the Philippines, and theCity of Manila.

2. By contrast, the unincorporated agency is so called because it has no separate juridical

personality but is merged in the general machinery of the government, like the

Department of Justice, the Bureau of Mines and the Government Printing Office.

- Could be performing governmental or proprietary function

Documents

Unincorporated Functions of the Government Digests