Palaez Vs Auditor General

9. Palaez vs Auditor General they do not constitute precedents and have no binding effect.
Both cases involved

grants to administrative officers of powers related to the exercise of
No. L-23825. December 24, 1965. their administrative functions, calling for the determination of questions of fact. Such
EMMANUEL PELAEZ, petitioner, vs. THE AUDITOR GENERAL, respondent. is not the nature of the powers dealt with in Section 68 of the Revised Administrative
Administrative law; Power of President to create municipalities.— Code. The creation of municipalities being essentially and eminently legislative in
Since January 1, 1960, when Republic Act No. 2370 became effective, barrios may character, the question whether or not "public interest" demands the exercise of such
"not be created or their boundaries altered nor their names changed" except by Act of power is not one of fact It is purely a legislative question (Carolina-Virginia Coastal
Congress or of the corresponding" provincial board "upon petition of a majority of the Highway vs.Coastal Turnpike Authority, 74 S.E. 2d. 310-313, 315-318), or a political
voters in the areas affected" and the "recommendation of the council of the question (Udall vs. Severn, 79 P. 2d. 347-349).
municipality or municipalities in which the proposed barrio is situated." This Same; Same; Same; Same; Proof that issuance of Executive Orders in
statutory denial of the presidential authority to create a new barrio implies a negation question enteils exercise of purely legislative functions.—The fact that Executive
of the bigger power to create municipalities, each of which consists of several barrios. Orders Nos. 93 to 121, 124 and 128 to 129, creating thirty-three municipalities, were
Same; Same; Nature of power to create municipalities.—Whereas the power issued
to f ix a common boundary, in order to avoid or settle conflicts of jurisdiction between 571
adjoining municipalities, may partake of an administrative nature—involving, as it
does, the adoption of means and ways to carry into effect the law creating" said VOL. 15, DECEMBER 24, 1965 571
municipalities—the authority to create municipal corporations is Pelaez vs. Auditor General
essentially legislative in nature, after the legislative bills for the creation of the said municipalities had failed to
Same; Same; Same; Requisites for valid delegation of power.—Although pass Congress, is the best proof that their issuance entails the exercise of purely
Congress may delegate to another branch of the government the power to fill in the legislative functions.
details in the execution, enforcement or administration of a law, it is essential that Same; Same; Same; Power of control over local governments.—The power of
said control under Section 10 (a) of Article X of the Constitution implies the right of the
570 President to interfere in the exercise of such discretion as may be vested by law in the
570 SUPREME COURT REPORTS ANNOTATED officers of the executive departments, bureaus or offices of the national government,
as well as to act in lieu of such officers. This power is denied by the Constitution to the
Pelaez vs. Auditor General Executive, insofar as local governments are concerned. With respect to the latter, the
law: (a) be complete in itself, setting forth therein the policy to be executed, fundamental law permits him to wield no more authority than that of checking
carried out or implemented by the delegate; and (b) fix a standard—the limits of whether said local governments or the officers thereof perform their duties as
which are sufficiently determinate or determinable—to which the delegate must provided by statutory enactments. Hence, the President cannot interfere with local
conform in the performance of his functions. governments, so long as the same or its officers act within the scope of their authority.
Same; Same; Same; Same; Requirements of due delegation of power not met He may not, for instance, suspend an elective official of a regular municipality or take
by Section 68 of Revised Administrative Code.—Section 68 of the Revised any disciplinary action against him, 'except on appeal from a decision of the
Administrative Code, insofar as it grants to the President the power to create corresponding provincial board. If, on the other hand, the President could create a
municipalities, does not meet the well-settled requirements for a valid delegation of municipality, he could, in effect, remove any of' its officials, by creating a new
the power to fix the details in the enforcement of a law. It does not enunciate any municipality and including therein the barrio in which the official concerned resides,
policy to be carried out or implemented by the President. for his office would thereby become vacant (Section 2179, Revised Administrative
Same; Same; Same; Same; Same; Abdication of powers of Congress in favor Code). Thus, by merely brandishing the power to create a new municipality, without
of the Executive.—If the validity of said delegation of powers, made in Section 68 of actually creating it, he could compel local officials to submit to his dictation; thereby,
the Revised Administrative Code, were upheld. there would no longer be any legal in effect, exercising over them the power of control denied to him by the Constitution.
impediment to a statutory grant of authority to the President to do anything which, in Same; Same; Same; Same; Section 68, Revised Administrative Code repealed
his opinion, may be required by public welfare or public interest. Such grant of by the Constitution.—The power of control of the President over executive
authority would be a virtual abdication of the powers of Congress in favor of the departments, bureaus or offices under Section 10(a) of Article X of the Constitution
Executive, and would bring about a total collapse of the democratic system implies no more than the authority to assume directly the functions thereof or to
established by the Constitution. interfere in the exercise of discretion by its officials. Manifestly, such control does not
Same; Same; Same; Nature of powers dealt with in Section 68 of the Revised include the authority either to abolish an executive department or bureau, or to create
Administrative Code.—It is true that in Calalang vs. WiIliams (70 Phil. 726) and a new one. As a consequence, the alleged power of the President to create municipal
People vs. Rosenthal (68 Phil. 328), this Court had upheld "public welfare" and corporations would necessarily connote the 'exercise by him of an authority even
"public interest," respectively, as sufficient standards for a valid delegation of the greater than that of control which he has over the executive departments, bureaus or
authority to execute the law. But the doctrine laid down in these cases must be offices, Instead of giving the President less power over local governments than that
construed in relation to the specific facts and Issues involved therein, outside of which vested in him over the executive departments, bureaus or offices, it reverses the
Page 1 of 13
process and does the exact opposite, by conferring upon him more power over During the period from September 4 to October 29, 1064 the President of the
municipal corporations than that which he has over executive departments, bureaus Philippines, purporting to act pursuant to Section 68 of the Revised Administrative
or offices. Even if, therefore, it did not entail an undue delegation of legislative Code, issued Executive Orders Nos, 93 to 121, 124 and 126 to 129; creating thirty-three
powers, as (33) municipalities enumerated in the margin.1 Soon after the date last mentioned, or
572 on November 10, 1964 petitioner Emmanuel Pelaez, as Vice President of the
572 SUPREME COURT REPORTS ANNOTATED Philippines and as taxpayer, instituted the present special civil action, for a writ of
prohibition with preliminary injunction, against the Auditor General, to restrain him,
Pelaez vs. Auditor General as well as his representatives and agents from passing in audit any expenditure of
it certainly does, said Section 68, as part of the Revised Administrative Code, public funds in implementation of said executive orders and/or any disbursement
approved on March 10, 1967, must be deemed repealed by the subsequent adoption of by ,said municipalities.
the Constitution in 1935, which is utterly incompatible and inconsistent with said Petitioner alleges that said executive orders are null and void, upon the ground
statutory enactment. (De los Santos vs. Mallare, 87 Phil. 289, 298299.) that said Section 68 has been impliedly repealed by Republic Act No. 2370 and
Same; Same; Same; Municipal officials concerned duly represented in constitutes an undue delegation of legislative power, Respondent maintains the
present case.—lt is contended that not all the proper parties have been impleaded in contrary view and avers that the present action
the present case. Suffice it to say that the records do not show, and the parties do not
claim, that the officers of any of the municipalities concerned have been appointed or _______________
elected and have assumed office. At any rate, the Solicitor General, who has appeared
on behalf of respondent Auditor General, is the officer authorized by law "to act and 1
represent the Government of the Philippines, its offices and agents, in any official
investigation, proceeding or matter requiring the services of a lawyer" (Section 1661, Executive Municipality Province Date Annex
Revised Administrative Code), and, in connection with the creation of the Order No. Promulgated (Original
municipalities involved in this case, which involves a political, not proprietary
function. said local officials, if any, are mere agents or representatives of the national 93 Nilo Zamboanga Sept. 4, 1961 A Petition)
government. Their interest in the case has accordingly been duly represented. del Sur
(Mangubat vs. Osmeña, Jr., G.R. No. L-12837, April 30, 1959; City of Cebu vs. Judge
Piccio, G.R. Nos L-13012 & 14876. December 81, 1960.) 94 Midsalip """ """ B
Same; Same; Action not premature.—The present action cannot be said to be 95 Pitogo """ """ C
premature simply because respondent Auditor General has not yet acted on any of the
executive orders in question and has not intimated how he would act in connection 96 Maruing """ """ D
therewith. It is a matter of common knowledge that the President has for many years 97 Naga """ """ E "
issued executive orders creating municipal corporations and that the same have been
organized and are in actual operation, thus indicating without peradventure or doubt, 99 Sebaste Antique "26" F "
that the expenditures incidental thereto have been sanctioned, approved or passed in 100 Molugan Misamis """ G "
audit by the General Auditing Office and its officials. There is no reason to believe that Oriental
respondent would adopt a different policy as regards the new municipalities involved
in this case, in the absence of an allegation to such effect, and none has been made by 101 Malixi Surigao del "28" H "
him. Sur
ORIGINAL ACTION in the Supreme Court. Prohibition with preliminary injunction.
The facts are stated in the opinion of the Court. 102 Roxas Davao """ I "
Zulueta, Gonzales, Paculdo & Associates for petitioner. 103 Magsaysay " """ J "
Solicitor General for respondent.
104 Sta, Maria " """ K "
573
105 Badiangan Iloilo """ L "
VOL. 15, DECEMBER 24, 1965 573
106 Mina " Oct. 1 " M "
Pelaez vs. Auditor General
107 Andong Lanao del Sur """ N "
CONCEPCION, J.: 108 Sultan Alonto """ """ O "
109 Maguing """ """ P "
110 Dianaton """ """ Q "
Page 2 of 13
Executive Municipality Province Date Annex "Barrios shall not be created or their boundaries altered nor their names changed
except under the provisions of this Act or by Act of Congress."
Order No. Promulgated (Original Pursuant to the first two (2) paragraphs of the same Section 3:
111 Elpidio Mt. Province """ R "Petition) "All barrios existing at the time of the passage of this Act shall come under the
provisions hereof.
Quirino "Upon petition of a majority of the voters in the areas affected, a new barrio may
112 Bayog Zamboanga """ S " be created or the name of an existing one may' be changed by the provincial board of
del Sur the province, upon recommendation of the council of the municipality or
municipalities in which the proposed barrio is stipulated. The recommendation of the
117 Gloria Oriental """ GG (Attached municipal council shall be embodied in a resolution approved by at least two-thirds of
Mindoro here to) the entire membership of the said council: Provided, however, That no new barrio
may be created if its population is less than five hundred persons."
113 Maasin Cotabato """ T Hence, since January 1, 1960, when Republic Act No. 2370 became effective, barrios
114 Siayan Zamboanga """ LC may "not be created or their boundaries altered nor their names changed'' except by
Act of Congress or of the corresponding provincial board "upon petition of a majority
del Norte of the voters in the areas affected" and the "recommendation of the council of the
115 Roxas """ """ V municipality or municipalities in which the proposed barrio is situated." Petitioner
argues, accordingly: "If the President, under this new law, cannot even create a barrio,
116P Panganuran """ """ W
can he create a municipality which is composed of several barrios, since barrios are
118 Kalilangan Bukidnon """ X units of municipalities?"
119 Lantapan " """ Y 575
120 Libertad Zamboanga """ Z VOL. 16, DECEMBER 24, 1965 575
del Sur Pelaez vs. Auditor General

Respondent answers in the affirmative, upon the theory that a new municipality can
121 General """ """ AA be created without creating new barrios, such as, by placing old barrios under the
Aguinaldo jurisdiction of the new municipality. This theory overlooks, however, the main import
124 Rizal Surigao del "3" BB of the petitioner's argument, which is that the statutory denial of the presidential
authority to create a new barrio implies a negation of the bigger power to create
Norte municipalities, each of which consists of se everal barrios. The cogency and force of
126 Tigao Surigao del "23" CC this argument is too obvious to be denied or even questioned. Founded upon logic and
experience, it cannot be offset except by a clear manifestation of the intent of
Sur Congress to the contrary, and no such manifestation, subsequent to the passage of
127 Tampakan Cotabato "26" DD Republic Act No. 2379, has been brought to our attention.
Moreover, section 68 of the Administrative Code, upon which the disputed
128 Maco Davao "29" EE
executive orders are based, provides:
129 New Corella " """ FF "The (Governor-General) President of the Philippines may by executive order define
574 the or boundaries, of any province, subprovince, municipality, [township] district, or
574 SUPREME COURT REPORTS ANNOTATED other political subdivision, and increase or diminish the territory comprised therein,
may divide any province into one or more subprovices, separate any political division
Pelaez vs. Auditor General other than a province, into such portions as may be required, merge any of such
is premature and that not all proper parties—referring: to the officials of the new subdivisions or portions with another, name any new subdivision so created, may
political subdivisions in question—have been impleaded, Subsequently, the mayors of change the seat of government within any subdivision to such place therein as the
several municipalities adversely affected by the aforementioned executive orders— public welfare may require: Provided, That the authorization of the (Philippine
because the latter have taken sway from the former the barrios composing Legislature) Congress of the Philippines shall first be obtained whenever the
the new political subdivisions—intervened in the case. Moreover, Attorneys Enrique boundary of any province or subprovince is to be defined or any province is to be
M. Fernando and Emma Quisumbing-Fernando were allowed to and did appear divided into one or more subprovinces. When action by the (Governor-General)
as amici curiae. President of the Philippines in accordance herewith makes necessary a change of the
The third paragraph of Section 3 of Republic Act No. 2370, reads: territory under the jurisdiction of any administrative officer or any judicial officer, the
(Governor-General) President of the Philippines, with the recommendation and
Page 3 of 13
advice of the head of the Department having executive control of such officer, shall functions.2a Indeed, without a statutory declaration of policy, the delegate would in
redistrict the territory of the several officers affected and assign such officers to the effect, make or formulate such policy, which is the essence of every law; and without
new districts so formed. the aforementioned standard, there would be no means to determine, with reasonable
"Upon the changing of the limits of political divisions in pursuance of the certainty, whether the delegate has acted within or beyond the scope of his
foregoing authority, an equitable distribution of the funds and obligations of the authority.2b Hence, he could thereby arrogate upon himself the power, not only to
divisions thereby affected make the law, but, also—and this is worse—to unmake it, by adopting measures
576 inconsistent with the end sought to be attained by the Act of Congress, thus nullifying
576 SUPREME COURT REPORTS ANNOTATED the principle of separation of powers and the system of checks and balances, and,
consequently, undermining the very foundation of our Republican. system.
Pelaez vs. Auditor General Section 68 of the Revised Administrative Code does not meet these well settled
shall be made in such manner as may be recommended by the (Insular Auditor) requirements for a valid delegation of the power to fix the details in the enforcement
Auditor General and approved by the (Governor-General) President of the of a law,
Philippines,"
Respondent alleges that the power of the President to create municipalities under this _____________
section does not amount to an undue delegation of legislative power, relying upon
Municipality of Cardona vs, Municipality of Binañgonan (86 Phil. 547), which, he 2
Calalang vs. Williams, 70 Phil. 726; Pangasinan Transp. Co. vs. Public Service
claims, has settled it. Such claim is untenable, for said case involved, not the creation Commission, 70 Phil. 221; Cruz vs. Youngberg, 56 Phil. 234; Alegre vs. Collector of
of a new municipality, but a mere transfer of territory—from an already Customs, 53 Phil. 394; Mulford vs. Smith, 307 U.S. 38.
existing municipality (Cardona) to another municipality (Binañgonan), likewise, 2a
People vs. Lim Ho, L- 12091-2, January 28, 1960; People vs. Jolliffe. L-9553,
existing at the time of and prior to said transfer (See Gov't of the P.I. ex rel. May 13, 1959; People vs. Vera, 65 Phil. 56; U.S. vs. Ang Tang Ho, 43 Phil. 1; Compañia
Municipality of Cardona vs. Municipality of Binañgonan [34 Phil. 518, 519-520])—in General de Tabacos vs. Board of Public Utility, 34 Phil. 136; Mutual Film Co. vs.
consequence of the fixing and definition, pursuant to Act. No. 1748, of the common Industrial Commission, 236 U.S. 247, 59 L. Ed. 561; Mutual Film Corp. vs. Industrial
bound aries of two municipalities. Commission, 236 U.S. 230, 59 L. Ed. 552; Pamana Refining Co. vs. Ryan, 293 U.S.
It is obvious, however, that, whereas the power to fix such common boundary, in 388, 79 L. Ed. 446; A.L.A. Schechter Poultry Corp. vs. U.S., 295 U.S. 495, 79 L Ed.
order to avoid or settle conflicts of jurisdiction between adjoining municipalities, may 1570; U S. vs. Rock Royal Coop., 307 U.S. 533, 83 L. Ed. 1446; Bowles vs.
partake of an administrative nature—involving, as it does, the adoption of means and Willingham, 321 U.S. 503, 88 L. Ed. 892; Araneta vs. Gatmaitan, L-8895, April 30,
ways to carry into effect the law creating said municipalities—the authority 1957; Cervantes vs. Auditor General, L-4043, May 26,1952; Phil. Association of
to createmunicipal corporations is essentially legislative in nature, In the language of Colleges vs. See. of Education, 51 Off. Gaz. 6230; People vs. Arnault, 48 Off. Gaz.
other courts, it is "strictly a legislativefunction" (State ex rel. Higgins vs. Aicklen, 119 4805; Antamok Gold Fields vs. CIR, 68 Phil. 340; U.S. vs. Barrias, 11 Phil. 327; Yakus
S. 425, January 2, 1959) or "solely and exclusively the exercise of legislative power" vs. White, 321 U.S. 414; Ammann vs. Mailonce. 332 U.S. 245
(Udall vs. Severn, May 29, 1938, 79 P. 2d 347-349). As the Supreme Court of 2b
Vigan Electric Light Company, Inc. vs. The Public Service Commission, L-
Washington has put it (Territory ex rel. Kelly vs. Stewart, February 13, 1890, 23 Pac. 19850, January 30, 1964.
405, 409), "municipal corporations are purely the creatures of statutes." 578
Although1a Congress may delegate to another branch of the Government the
power to fill in the details in the execution, enforcement or administration of a law, it 578 SUPREME COURT REPORTS ANNOTATED
is essential, to forestall a violation of the principle of separation of -powers, that said Pelaez vs. Auditor General
law: (a) be complete in itself It does not enunciate any policy to be carried out or implemented by the President
Neither does it give a standard suf f iciently precise to avoid the evil effects above
______________ referred to, In this connection, we do not overlook the fact that, under the last clause
of the first sentence of Section 68, the President:
1a
Except to local governments, to which legislative powers, with respect to matters "x x x may change the seat of the government within any subdivision to such place
of local concern, may be delegated. therein as the public welfare may require"
577 it is apparent, however, from the language of this clause, that the phrase "as the public
VOL. 15, DECEMBER 24, 1965 577 welfare may require" qualified, not the clauses preceding the one just quoted,
but only the place to which the seat of the government may be transferred. This fact
Pelaez vs. Auditor General becomes more apparent when we consider that said Section 68 was originally Section
—it must set forth therein the policy to be executed, carried out or implemented by 1 of Act No. 1748,3 which provided that, "whenever in the judgment of the Governor-
the delegate2—and (b) fix a standard—the limits of which are sufficiently determinate General the public welfare, requires, he may, by executive order," effect the changes
or determinable—to which the delegate must conform in the performance of his
Page 4 of 13
enumerated therein (as in said section 68), including the change of the seat of the Such is not the nature of the powers dealt with in section 880 As above indicated,
government "to such place x x x the creation of municipalities,
_____________ _____________
3 4
Whenever in the judgment of the Governor-General the public welfare requires, McGirr vs. Hamilton, 30 Phil. 563; Hebron vs. Reyes, L-9124. July 28, 1958; U.S.
he may, by executive order, enlarge, contract, or otherwise change the boundary of vs. More, 3 Cranch 159, 172; U.S. vs. Sanges, 144 U.S. 310, 319; Cross vs. Burke, 146
any province, subprovince, municipality or township or other political subdivision, or U.S. 82; Louisville Trust Co. vs. Knott, 191 U.S. 225. See also, 15 C.J., 929-940; 21
separate any such subdivision into such portions as may be required as aforesaid, C.J.S. 297, 299; 14 Am. Jur. 345.
merge any of such subdivisions or portions with another, divide any province into one 580
or more subprovinces as may be required as aforesaid, name any new subdivision so 580 SUPREME COURT REPORTS ANNOTATED
created, change the seat of government within any subdivision, 'existing or created
hereunder, to such place therein as the public interests require, and shall fix in such Pelaez vs. Auditor General
executive order the date when the change, merger, separation, or other action shall is not an administrative function, but one which is essentially and eminently
take effect. Whenever such action as aforesaid creates a new political subdivision the legislative in character. The question of whether or not "public interest" demands the
Governor-General shall appoint such officers for the new subdivision with such exercise of such power is not one of fact. It is "purely a legislative question
powers and duties as may be required by the existing provisions of law applicable to "(Carolina-Virginia Coastal Highway vs. Coastal Turnpike Authority, 74 S.E. 2d. 310-
the case and fix their salaries; such appointees shall hold office until their successors 313, 315-318), or a political question (Udall vs. Severn, 79 P. 2d. 347-349), As the
are elected or appointed and qualified. Successors to the elective offices shall be Supreme Court of Wisconsin has aptly characterized it, "the question as to whether
elected at the next general election following such appointment, Such equitable incorporation is for the best interest of the community in any case is emphatically
distribution of the funds of changed subdivisions between the subdivisions affected a question of public policy and statecraft" (In re Village of North Milwaukee, 67 N.W.
shall be as is recommended by the Insular Auditor and approved by the Governor- 1033, 1035-1037).
General. For this reason, courts of justice have annulled, as constituting undue delegation
579 of legislative powers, state laws granting the judicial department the power to
determine whether certain territories should be annexed to a particular municipality
VOL. 15, DECEMBER 24, 1965 579
(Udall vs. Severn, supra, 258-359); or vesting in a Commission the right to determine
Pelaez vs. Auditor General the plan and frame of government of proposed villages and what functions shall be
as the public interest requires" The opening statement of said Section 1 of Act No, exercised by the same, although the powers and functions of the village are
1748—which was not included in Section 68 of the Revised Administrative Code— specifically limited by statute (In re Municipal Charters, 86 Atl. 307-308); or
governed the time at which, or the conditions under which, the powers therein conferring upon courts the authority to declare a given town or village incorporated,
conferred could be exercised; whereas the last part of the first sentence of said section and designate its metes and bounds, upon petition of a majority of the taxable
referred exclusively to the place to which the seat of the government was to be inhabitants thereof, setting forth the area desired to be included in such village
transferred. (Territory ex rel Kelly vs. Stewart, 28 Pac. 405-409); or authorizing the territory of a
At any rate, the conclusion would be the same, insofar as the case at bar is town, containing a given area and population, to be incorporated as a town, on certain
concerned, even if we assumed that the phrase "as the public welfare may require," in steps, being taken by the inhabitants thereof and on certain determination by a court
said Section 68, qualifies all other clauses thereof. It is true that in Calalang vs. and subsequent vote of the inhabitants in favor thereof, insofar as the court is allowed
Williams (70 Phil. 726) and People vs. Rosenthal (68 Phil. 328), this Court had to determine whether the lands embraced in the petition "ought justly" to be included
upheld "public welfare" and "public interest," respectively, as sufficient standards for in the village, and whether the interest of the inhabitants will be promoted by such
a valid delegation of the authority to execute the law, But, the doctrine laid down in incorporation, and to enlarge and diminish the boundaries of the proposed village "as
these cases—as all judicial pronouncements—must be construed in relation to the justice may require" (In re Villages of North Milwaukee, 67 N.W. 10351037); or
specific facts and issues involved 'therein, outside of which they do not constitute creating a Municipal Board of Control which shall 'determine whether or not the
precedents and have no binding effect.4 The law construed in the Calalang case laying out, construc-
conferred upon the Director of Public Works, with the approval of the Secretary of 581
Public Works and Communications, the power to issue rules and regulations VOL. 15, DECEMBER 24, 1965 581
to promote safe transit upon national roads and streets.Upon the other hand, the
Rosenthal case referred to the authority of the Insular Treasurer, under Act No. 2581, Pelaez vs. Auditor General
to issue and cancel certificates or permits for the sale of speculative securities. Both tion or operation of a toll road is in the "public interest" and whether the
cases involved grants to. administrative officers of powers related to the exercise of requirements of the law had been complied with, in which case the board shall enter
their administrative functions, calling for the determination of questions of fact.
Page 5 of 13
an order creating a municipal corporation and fixing the name of the same (Carolina- the executive departments, bureaus, or offices of the national government, as well as
Virginia Coastal Highway vs. Coastal Turnpike Authority, 74 S.E. 2d. 310). to act in lieu of such officers. This power is, denied by the Constitution to the
Insofar as the validity of a delegation of power by Congress to the President is Executive, insofar as local governments are concerned. With respect to the latter, the
concerned, the case of Schechter Poultry Corporation vs. U.S. (79 L. Ed. 1570) is quite fundamental law permits him to wield no more authority than that of checking
relevant to the one at bar. The Schechter case involved the constitutionality of Section whether said local governments or the officers thereof perform their duties as
3 of the National Industrial Recovery Act authorizing the President of the United provided by statutory enactments. Hence, the President cannot interfere with local
States to approve "codes of fair competiton" submitted to him by one or more trade or governments, so long as the same or its officers act within the scope of their authority,
industrial associations or corporations which "impose no inequitable restrictions on He may not enact an ordinance which the municipal council has failed or refused to
admission to membership therein and are truly representative," provided that such pass, even if it had thereby violated a duty imposed thereto by law, although he may
codes are not designed "to promote monopolies or to eliminate or oppress small see to it that the corresponding provincial officials take appropriate disciplinary
enterprises and will not operate to discriminate against them, and will tend to action therefor.
effectuate the policy" of said Act. The Federal Supreme Court held: 583
"To summarize and conclude upon this point: Sec. 3 of the Recovery Act is without VOL. 15, DECEMBER 24, 1965 583
precedent. It supplies no standards for any trade, industry or activity. It does not
undertake to prescribe rules of conduct to be applied to particular states of fact Pelaez vs. Auditor General
determined by appropriate administrative procedure. Instead of prescribing rules of Neither may he vote, set aside or annul an ordinance passed by said council within the
conduct, it authorizes the making of codes to prescribe them. For that legislative scope of its jurisdiction, no matter how patently unwise it may be. He may not even
undertaking, Sec. 3 sets up no standards, aside from the statement of the general aims suspend an elective official of a regular municipality or take any disciplinary action
of rehabilitation. correction and expansion described in Sec. 1. In view of the scope of against him, except on appeal from a decision of the corresponding provincial board. 5
that broad declaration, and of the nature of the few restrictions that are imposed, the Upon the other hand, if the President could create a municipality, he could, in
discretion of the President in approving or prescribing codes, and thus enacting laws effect, remove any of its officials, by creating a new municipality and including therein
for the government of trade and industry throughout the country, is virtually the barrio in which the official concerned resides, for his office would thereby become
unfettered. We think that the code making authority thus conferred is an un vacant,6 Thus, by merely brandishing the power to create a new municipality (if he
constitutional delegation of legislative power." had it), without actually creating it, he could compel local officials to submit to his
If the term "unfair competition" is so broad as to vest in the President a discretion dictation, thereby, in effect, exercising over them the power of control denied to him
that is "virtually unfettered." and, consequently, tantamount to a delegation of by the Constitution.
legislative power, it is obvious that "public welfare," which has even a broader Then, also, the power of control of the President over executive departments,
connotation, leads to the same result. In bureaus or offices implies no morethan the authority to assume directly the f unctions
582 thereof or to interfere in the exercise of discretion by its officials. Manifestly, such
control does not include the authority either to abolish an executive department or
582 SUPREME COURT REPORTS ANNOTATED
bureau, or to create a new one. As a consequence, the alleged power of the President
Pelaez vs. Auditor General to create municipal corporations would necessarily connote the exercise by him of an
fact, if the validity of the delegation of powers made in Section 88 were upheld, there authority even greater than that of control which he has over the executive
would no longer be any legal impediment to a statutory grant of authority to the departments, bureaus or offices. In other words, Section 68 of the Revised
President to do anything which, in his opinion, may be required by public welfare or Administrative Code does not mere-
public interest. Such grant of authority would be a virtual abdication of the powers of
Congress in favor of the Executive, and would bring about a total collapse of the _____________
democratic system established by our Constitution, which it is the special duty and
privilege of this Court to uphold. 5
Hebron vs. Reyes, L-9124, July 28, 1958; Mondano vs. Silvosa, 51 Off. Gaz.
It may not be amiss to note that the executive orders in question were issued 2884; Rodriguez vs. Montinola, 50 Off. Gaz, 4820; Querubin vs. Castro, L-9779, July
after the legislative bills for the creation of the municipalities involved in this case 31, 1958.
had failed to pass Congress. A better proof of the fact that the issuance of said 6
Pursuant to Section 2179 of the Revised Administrative Code:
executive orders entails the exercise of purely legislative functions can hardly be "When a part 01 a barrio is detached from a municipality to form a new municipality
given. or to be added to an existing municipality, any officer of the old municipality living in
Again, Section 10(1) of Article VII of our fundamental law ordains: the detached territory may continue to hold his office and exert the functions thereof
"The President shall have control of all the executive departments, bureaus, or offices, for the remainder of his term; but if he is resident of a barrio the whole of which is
exercise general supervision over all local governments as may be provided by law, detached, his office shall be deemed to be vacated"
and take care that the laws be faithfully executed." 584
The power of control under this provision implies the right of the President to
interfere in the exercise of such discretion as may be vested by law in the officers of 584 SUPREME COURT REPORTS ANNOTATED
Page 6 of 13
expenditure of public funds in implementation of said Executive Orders or any
disbursement by the municipalities above referred to. It is so ordered.
ly fail to comply with the constitutional mandate above quoted. Instead of giving the
Bengzon, C.J., Bautista Angelo, Reyes, J.B.L., Barrera and Dizon,
President less power over local governments than that vested in him over the
JJ., concur.
executive departments, bureaus or offices, it reverses the pro cess and does the exact
Zaldivar, J., took no part.
opposite, by conferring upon him more power over municipal corporations than that
Bengzon, J.P., J., concurs and dessents is a seperate opinion.
which he has over said executive departments, bureaus or offices.
Makalintal and Regala, JJ., concur with the opinion of Justice J.P. Bengzon.
In short, even if it did entail an undue delegation of legislative powers, as it
certainly does, said Section 68, as part of the Revised Administrative Code, approved
on March 10, 1917, must be deemed repealed by the subsequent adoption of the BENGZON, J.P., J., concurring and dissenting:
Constitution, in 1935, which is utterly incompatible and inconsistent with said
statutory enactment.7 A sign of progress in a developing nation is the rise of new municipalities. Fostering
There are only two (2) other points left for consideration, namely, respondent's their rapid growth has long been the aim pursued by all three branches of our
claim (a) that "not all the proper parties"—referring to the officers of the newly Government.
created municipalities—"have been impleaded in this case," and (b) that "the present So it was that the Governor-General during the time of the Jones Law was given
petition is premature/' authority by the Legislature (Act No. 1748) to act upon certain details with respect to
As regards the first point, suffice it to say that the records do not show, and the said local governments, such as fixing of boundaries, subdivisions and mergers. And
parties do not claim, that the officers, of any of said municipalities have been the Supreme Court, within the framework of the Jones Law, ruled in 1917 that the
appointed or elected and assumed office. At any rate, the Solicitor General. who has exec-
appeared on behalf of respondent Auditor General, is the officer authorized by law "to 586
act and represent the Government of the Philippines, its offices and agents, in any 586 SUPREME COURT REPORTS ANNOTATED
official investigation, proceeding or matter requiring the services of a lawyer" (Section
1661, Revised Administrative Code), and, in connection with the creation of the Pelaez vs. Auditor General
aforementioned municIpalities, which involves a political, not proprietary, function, ution or implementation of such details, did not entail abdication of legislative power
said local officials, if any, are mere agents or representatives of the national (Government vs. Municipality of Binangonan, 34 Phil. 518; Municipality ,of Cardona
government. Their interest in the case at bar has, accordingly, been, in effect, duly vs. Municipality of Binañgonan, 36 Phil. 547). Subsequently, Act No. 1748 's aforesaid
represented.8 statutory authorization was embodied in Section 68 of the Revised Administrative
With respect to the second point, respondent alleges that Code. And Chief Executives since then up to the present continued to avail of said
provision, time and again invoking it to issue executive orders providing for the
______________ creation of municipalities.
From September 4, 1964 to October 29, 1964 the President of the Philippines
7 issued executive orders to create thirty-three municipalities pursuant to Section 68 of
De los Santos vs. Mallare, 87 Phil, 289, 298-299. the Revised Administrative Code. Public funds thereby stood to be disbursed in
8
Mangubat vs. Osmeña, Jr., L-12837, April 20, 1959; City of Cebu vs. Judge implementation of said executive orders.
Piccio. L-13012 & L-14876, December 31, 1960, Suing as private citizen and taxpayer, Vice President Emmanuel Pelaez filed in
585 this Court a petition for prohibition with preliminary injunction against the Auditor
VOL. 15, DECEMBER 24, 1965 585 General. It seeks to restrain the respondent or any person acting in his behalf, from
passing in audit any expenditure of public funds in implementation of the executive
orders aforementioned.
he has not as yet acted on any of the executive orders in question and has not
Petitioner contends that the President has no power to create a municipality by
intimated how he would act in connection therewith. It is, however, a matter of
executive order. It is argued that Section 68 of the Revised Administrative Code of
common, public knowledge, subject to judicial cognizance, that the President has, for
1917, so far as it purports to grant any such power, is invalid or, at the least, already
many years, issued executive orders creating municipal corporations and that the
repealed, in light of the Philippine Constitution and Republic Act 2370 (The Barrio
same have been organized and in actual operation, thus indicating, without
Charter),
peradventure of doubt, that the expenditures incidental thereto have been sanctioned,
Section 68 is again reproduced hereunder for convenience:
approved or passed in audit by the General Auditing Office and its officials. There is
"SEC. 68. General authority of [Governor-General] President of the Philippines to fix
no reason to believe, therefore, that respondent would adopt a different policy as
boundaries and make new subdivisions.—The[Governor-General] President of the
regards the new municipalities involved in this case, in the absence of an allega-tion
Philippines may by executive order define the boundary, or boundaries, of any
to such effect, and none has been made by him
province, subprovince, municipality, [township] municipal district, or other political
WHEREFORE, the Executive Orders in question are hereby declared null and
subdivision, and increase or diminish the territory comprised therein, may divide any
void ab initio and the respondent permanently restrained from passing in audit any
Page 7 of 13
province into one or more subprovinces, separate any political division other than a Under the prevailing rule in the United States—and Section 68 is of American origin—
province, into such portions as may be required. the provision in question would be an invalid attempt to delegate purely legislative
587 powers, contrary to the principle of separation of powers.
VOL. 15, DECEMBER 24, 1965 587 It is very pertinent that Section 68 should be considered with the stream of
history in mind. A proper knowledge of the past is the only adequate background for
Pelaez vs. Auditor General the present. Section 68 was adopted half a century ago. Political change, two world
merge any of such subdivisions or portions with another, name any new subdivision wars, the recognition of our independence and rightful place in the family of nations,
so created, and may change the seat of government within any subdivision to such have since taken place. In 1917 the Philippines had for its Organic Act the Jones Law.
place therein as the public welfare may require: Provided, That the authorization of And under the setup ordained therein 110 strict separation of powers was adhered to.
the [Philippine Legislature] Congress of the Philippines shall first be obtained Consequently, Section 68 was not constitutionally objectionable at the time of its
whenever the boundary of any province or subprovince is to be defined or any enactment.
province is to be divided into one or more subprovinces. When action by the The advent of the Philippine Constitution in 1935 however altered the situation.
[GovernorGeneral] President of the Philippines in accordance herewith makes For not only was separation of powers strictly ordained, except only in specific
necessary a change of the territory under the jurisdiction of any administrative officer instances therein provided, but the power of the Chief Executive over local
or any judicial officer, the [Governor-General] President of the Philippines, with the governments suffered an explicit reduction.
recommendation and advice of the head of the Department having executive control Formerly, Section 21 of the Jones Law provided that the Governor-General "shall
of such officer, shall redistrict the territory of the several officers to the new districts have general supervision and control of all the departments and bureaus of the
so formed. government in the Philippine Islands," Now Section 10 (1), Article VII of the
"Upon the changing of the limits of political divisions in pursuance of the Philippine Constitution provides: "The President shall have control of all the executive
foregoing authority, an equitable distribution of the funds and obligations of the departments, bureaus, or offices. exercise general supervision over all local
divisions thereby affected shall be made in such manner as may be recommended by governments as may be provided by law, and take care that the laws be faithfully
the [Insular Audtior] Auditor General and approved by the [Governor-General] executed.
President of the Philippines." In short, the power of control over local governments had now been taken away
From such working I believe that power to create a municipality is included: to from the Chief Executive. Again,
"separate any political division other than a province, into such portions as may be 589
required, merge any such subdivisions or portions with another, name any new
VOL. 15, DECEMBER 24, 1965 589
subdivision so created." The issue, however, is whether the legislature can validly
delegate to the Executive such power, Pelaez vs. Auditor General
The power to create a municipality is legislative in character. American authorities to fully understand the significance of this provision, one must trace its development
have therefore favored the view that it cannot be delegated; that what is delegable is and growth.
not the power to create municipalities but only the power to determine the existence As early as April 7, 1900 President McKinley of the United States, in his
of facts under which creation of a municipality will result (37 Am. Jur. 628). Instructions to the Second Philippine Commission, laid down the policy that our
The test is said to lie in whether the statute allows any discretion on the delegate municipal governments should be "subject to the least degree of supervision and
as to whether the municipal corporation should be created, If so, there is an control" on the part of the national government. Said supervision and control was to
attempted delegation of legislative power and the statute is invalid (Ibid.). Now be confined within the "narrowest limits" or so much only as "may be necessary to
Section 68 no doubt gives the President such discretion, since it says that the secure and enforce faithful and efficient administration by local officers/' And the
President "may by executive order" exercise the powers therein granted. Furthermore, national government "shall have no direct administration except of matters of purely
Section 5 of the same Code states: general concern." (See Hebron v. Reyes, L-9158, July 28, 1958.)
588 All this had one aim, to enable the Filipinos to acquire experience in the art of
588 SUPREME COURT REPORTS ANNOTATED self-government, with the end in view of later allowing them to assume complete
management and control of the administration of their local affairs. Such aim is the
Pelaez vs. Auditor General policy now embodied in Section 10(1), Article VII of the Constitution (Rodriguez v.
"SEC. 5. Exercise of administrative discretion.—The exercise of the permissive Montinola, 50 O.G. 4820).
powers of all executive or administrative officers and bodies is based upon discretion, It is the evident decree of the Constitution, therefore, that the President shall have
and when such officer or body is given authority to do any act but not required to do no power of control over local governments. Accordingly, Congress cannot by law
such act, the doing of the same shall be dependent on a sound discretion to be grant him such power (Hebron v. Reyes, supra). And any such power formerly
exercised for the good of the service and benefit of the public, whether so expressed in granted under the Jones Law thereby became unavoidably inconsistent with the
the statute giving the authority or not" Philippine Constitution.
It remains to examine the relation of the power to create and the power to control
local governments. Said relationship has already been passed upon by this Court in
Page 8 of 13
Hebron v. Reyes, supra, In said case, it was ruled that the power to control is Executive orders declared null and void.
an incident of the power to create or abolish municipalities, Respondent's view A N N O T A T I O N
therefore, that creating municipalities and controlling their local governments are
"two worlds apart," is untenable. And since as stated, the power to control local CREATION OF MUNICIPALITIES
governments can no longer be conferred on or exercised by the President, it follows Historical Background of the Power of Creating Municipalities in the Philippines.
a fortiori that the power to create them, all the more cannot be so conferred or During the Spanish regime the procedure of the creation of municipalities has been
exercised. prescribed by the Leyes de las Indias (Roman Catholic Bishop of Jaro vs. Director of
590 Lands, 34 Phil. 528; see also Law VIII, Title VII, Book IV of Recopilación de Leyes de
590 SUPREME COURT REPORTS ANNOTATED los Reynos de las Indias).
In the case of Catbalogan vs. Director of Lands, 17 Phil., 214, the Court took
Pelaez vs. Auditor General cognizance of the procedure for the formation of towns during the Spanish regime,
I am compelled to conclude, therefore, that Section 10(1), Article VII of the Executive authorities and officials who then represented the Spanish government
Constitution has repealed Section 68 of the Revised Administrative Code as far as the were obliged to adjust their procedures in the fulfillment of their duties with regard to
latter empowers the President to create local governments. Repeal by the Constitution the establishment and laying out of new towns to the Leyes de las Indias.
of prior statutes inconsistent with it has already been sustained in De los Santos v. An Ayuntamiento corresponds to the English term municipal corporation and the
Mallare, 87 Phil. 289. And it was there held that such repeal differs from a declaration municipal government in the Islands falls short of being such a
of unconstitutionality of a posterior legislation, so much so that only a majority vote of corporation (Government of the Philippine Islands vs. Abadilla, 46 Phil. 842; see
the Court is needed to sustain a finding of repeal. also Roman Catholic Church vs. Municipally of Cebu, 31 Phil. 517).
Since the Constitution repealed Section 68 as far back as 1935, it is academic to 592
ask whether Republic Act 2370 likewise has provisions in conflict with Section 68 so
as to repeal it. Suffice it to state, at any rate, that statutory prohibition on the 592 SUPREME COURT REPORTS ANNOTATED
President from creating a barrio does not, in my opinion, warrant the inference of Pelaez vs. Auditor General
statutory prohibition for creating a municipality. For although municipalities consist The unit of local administration during the Spanish regime was the "pueblo" which
of barrios, there is nothing in the statute that would preclude creation of new ordinarily embraces an area of.many square miles and contained numerous barrios or
municipalities out of pre-existing barrios. villages.
It is not contrary to the logic of local autonomy to be able to create larger political
units and unable to create smaller ones. For as long ago observed in President Historical Background under the American Regime.
McKinley's instructions to the Second Philippine Commission, greater autonomy is to The law governing municipalities was first provided for in General Order No. 43,
be imparted to the smaller of the two political units. The smaller the unit of local Series of 1899. This law was followed by General Order No. 40, Series of 1900
government, the lesser 'is the need for the national government's intervention in its promulgated by the Military Governor. President it William McKinley's Instructions
political affairs. Furthermore, for practical reasons, local autonomy cannot be given to the Second Philippine Commission also stressed the importance of the creation of
from the to? downwards. The national government. in such a case, could still exercise municipal governments.
power over the supposedly autonomous unit, e.g., municipalities, by exercising it over The Philippine Commission forthwith enacted Act No. 82 on January 31, 1901
the smaller units that comprise them, e.g., the barrios. A realistic program of providing for the organization and government of municipalities. Act No. 88 was
decentralization therefore calls for autonomy from the bottom upwards, so that it is passed on February 5, 1901 for the organization of the provinces. The law on
not surprising for Congress to deny the national government some power over barrios provincial and municipal governments were embodied in Chapters 56, 57, 64 and 67
without denying it over municipalities. For this reason, I disagree with the majority of the Revised Administrative Code.
view that because the President could not create a barrio under Republic Act 2370, a The Power to Create Corporations is Essentially Legislative.
fortiori he cannot create a municipality. The power of the municipal corporation is essentially legislative in nature. The power
591 is exclusive and almost unlimited. In the absence of any constitutional limitations, a
VOL. 15, DECEMBER 24, 1965 591 legislative body may create any corporation it deems essential for the more efficient
administration of the government (I McQuillin, Municipal Corporations, 3rd ed.,509;
Pelaez vs. Auditor General 19 R.C.L. section 2).
It is my view, therefore, that the Constitution, and not Republic Act 2370, repealed The legislative power to create municipal corporations may not be delegated
Section 68 of the Revised Administrative Code's provision giving the President (Cooley, Municipal Corporations, p. 30), The delegation, if at all, may be made if the
authority to create local governments. And for this reason I agree with the ruling in legislature imposes conditions on which the municipal corporation may be created.
the majority opinion that the executive orders in question are null and void. The legislative may prescribe standards for guidance and authorize an agency to
In thus ruling, the Court is but sustaining the fulfillment of our historic desire to determine facts on which the statute may be implemented for the creation of such
be free and independent under a republican form of government, and exercising a corporation.
function derived from the very sovereignty that it upholds, In some jurisdictions, it has been held that the legislative
Page 9 of 13
593 Creation of Barrios by Authority of Law.
VOL. 15, DECEMBER 24, 1965 593 Under the Revised Barrio Charter (Republic Act No. 3590) barrios may be created
directly by the lawmaking body, or a creation of the same may be caused by another
agency (Sec. 3, Republic Act No. 3590). The Barrio Charter Law does not give the
body may vest in a court the power to determine when the incorporation of the
uncontrolled power to determine whether or not to create the barrio and the
community is necessary or useful or to determine the extent and boundary of such
conditions under which such barrio should be created because the law has set forth
corporations. (I McQuillin, Municipal Corporations, 3rd Ed., p. 505). Usually, in the
specific conditions (Aruego, Id.).
creation of municipal corporations the conditions needed in order to obtain its
incorporation as a city or town are prescribed. Such conditions may indicate the Constitutional Validity of Creation under Administrative Code by the Executive.
extent of the area proposed to incorporate, the nature of the territory, the character of Before the effectivity of the Administrative Code of 1918, Act 1748 was passed
the lands and the uses to which it may be devoted, the number of inhabitants and authorizing the Governor General of the Philippines to make adjustment of provincial
even the density and location of the area to be incorporated (I McQuillin, Municipal and municipal boundaries and the change of capitals of
Corporations, p. 531). 595
The Nature of the Power to Create Municipal Corporation in the Philippines. VOL. 15, DECEMBER 24, 1965 595
The power to create corporation including municipal corporation resides in the Pelaez vs. Auditor General
Congress of the Philippines. Such power included in the general legislative power of provinces from time to time to serve the public convenience and interest
Congress states: "The legislative power shall be vested in a Congress of the Philippines The Supreme Court overruled the contention that the act was an undue delegation
which shall consist of a Senate and a House of Representatives" (Art VI, Section 1, of legislative power. The Supreme Court ruled:
Constitution of the Philippines; Tiaco vs. Forbes, 228 U.S. 549; Asuncion vs. "The delegation of the power referred to on the Governor General does not involve an
Yriarte, 37 Phil. 67). abdication of legislative functions on the part of the legislature with regard to the
Under this authority, Congress may enact laws creating provinces, sub-provinces, particular subject matter with which it authorizes the Governor General to deal. It is
cities, municipalities, municipal districts, barrios and other local entities. It may simply a transference of certain details with respect to provinces, municipalities, and
group into one area those which are already existing. It may subdivide them into townships, many of them newly created, and all of them subject to more or less rapid
several other local areas. It may abolish them. There is no limitation upon Its power change both in development and center of population, the proper regulation of which
except the provisions of Art. VII, Section 1 of the Constitution (Aruego, Law on might require not only prompt action but action of such a detailed character as not to
Municipal Government, 1968 Ed., p. 37), permit the legislative body, as such, to take it efficiently." (Cardona vs.
The Provincial Board may also organize barrios under Republic Act No. 2370. See Binañgonan, 36 Phil. 547).
also Republic Act No. 2264, June 19, 1959, Republic Act No, 5185 and Republic Act The Supreme Court likewise upheld the constitutional legality of an executive order of
No. 1205. For organization of municipalities, see Section 2170 of the Revised the Governor General in redefining the boundary between the municipalities of
Administrative Code as amended by Republic Act No. 2368. Cardona and Binañgonan (Government of the P.I. vs. Municipality of
594 Binañgonan, 35 Phil. 518).
594 SUPREME COURT REPORTS ANNOTATED Section 68 of the Revised Administrative Code of 1917 was enacted.
"SEC. 68. General Authority of the (Governor General) President of the Philippines
to fix boundaries and make new subdivisions.—The Governor General (now
The Nature of the Legislative Power to Create the Area For Local Government. President of the Philippines) may by executive order define the boundary, or
The legislative power to create an area of the local government involves two things: (1) boundaries, of any province, subprovince, municipality, (township) municipal district
the determination of whether a local area -shall be created or not; (2) the (See Act 27824), or other political subdivision, and increase or diminish the territory
determination of whether said decision shall have the force of law. To leave the comprised therein, may divide any province into one or more subprovinces, separate
decision to another agency or person to create or not to create and to determine the any political division other than a province, into such portions as may be required,
conditions under which he would create, or to have discretion whether to follow or not merge any of such subdivisions or portions with another, name any new division so
to follow the rule laid down in the law, would be undue delegation of legislative power created, and may change the seat of government within any subdivision into such
(Aruego, op. cit., 1968 Ed., p. 37). place therein as the public welfare may require: Provided. That the authorization of
There would be no unlawful delegation of legislative power to create the area the Philippine Legislature (now Congress of the Philippines) shall first be obtained
when the legislative power determines by law the conditions under which the local whenever the boundary of any province or subprovince is to be defined or any
area may be created. Not leaving this or some of them to be determined by another province is to be divided into one or more subprovinces. x x x."
agency of the government. It 10 not unlawf ul delegation of legislative power to create The Governors General and later the Presidents of the
when the agency has the authority to carry out the provisions of the law and the 596
discretion is only as to the manner of executing the law (Id.).
596 SUPREME COURT REPORTS ANNOTATED
Page 10 of 13
The Executive power shall be vested in a President of the Philippines. (Art. VII,
Sec. 1, Phil. Constitution).
Philippines create several municipalities under this section. This law practically gave
The Judicial power shall be vested in one Supreme Court and in such inferior
uncontrolled discretion to the executive to create new areas as municipalities and is of
courts as may be established by law. (Art. VIII, Sec. 1, Phil. Constitution).
doubtf ul legality, For cases on delegation of legislative powers as valid standards for
The Government of the United States in the Philippines is one whose powers have
delegation of power, see People vs. Lim Ho, L-12091-2, January 28,1960; People vs.
been carefully apportioned between three distinct departments which have their
Jolliffe, L-9553, May 13, 1959; People vs. Vera, 65 Phil. 56; U.S. vs. Ang Tang Ho, 43
powers alike, limited and defined, and are of equal dignity and, within their respective
Phil. 1; Compañia General de Tabacos vs. Board of Public Utility, 34 Phil.
spheres of action, equally independent. (Abueva vs. Wood, 46 Phil. 613).
136; Mutual Film Co. vs. Industrial Commission, 236 U.S. 247, 59 L. Ed. 561; Mutual
Film Corp. vs. Industrial Commission, 236 U.S. 230, 59 L. Ed. 552; Pamana Refining III. Importance of the principle.
Co. vs. Ryan, 293 U.S. 388, 79 L. Ed. 446; A.L.A. Schechter Poultry Corp. vs. It has been said that the principle of separation of powers of government is
U.S., 295 U.S. 79 L. Ed. 1570, U.S. vs. Rock Royal Coop.,307 U.S. 533, L. Ed. fundamental to the very existence of every constitutional government. It represents
1446; Bowles vs. Willingham, 321, U.S. 503, 88 L. Ed. 892; Araneta vs. the most important principle of government declaring and guaranteeing the liberties
Gatmaitan, L8895, April 30, 1957; Cervantes vs. Auditor General, L4043, May 30, of the people. (Am. Jur. 182) Under our constitutional system, the powers of
1952; Phil. Association of Colleges vs. Secretary of Education, 51 Off. Gaz. government are distributed among three co-ordinate and substantially independent
6230; People vs. Arnault. 48 Off. Gaz, 4805; Antamok Gold Field-vs. CIR. 68 Phil. organs: the legislative, the executive and the
340; U.S. vs. Barrias,11 Phil. 327; Yajus vs. White, 821 U.S. 414; Ammann vs. 598
Mailonce, 332 U.S. 245. 598 SUPREME COURT REPORTS ANNOTATED
Section 68 of the Revised Administrative Code has been declared unconstitutional
in the case of Pelaez vs. Jimenez,G.R. No. L-23825. December 24, 1965. The Supreme Pelaez vs. Auditor General
Court thus reiterated the f undamental principle that the creation of municipal judicial. Each of these departments of the government derives its authority from the
corporations is legislative in nature. Constitution, which, in turn, is the highest expression of the popular will. Each has
Moreover, Section 3 of Republic Act No. 2370 which took effect on January 1, exclusive cognizance of the matters within the jurisdiction and is supreme within its
1960 provided that barrios may not be created or their boundaries altered except by own sphere. (People vs. Vera, 65 Phil. 63).
act of Congress or by the corresponding provincial board upon petition of the majority By the organic law of the Philippine Islands and the Constitution of the United
of the voters in the area affected and the recommendation of the municipality in States, all powers are vested in the Legislature, Executive and Judiciary, It is the duty
which the proposed barrios are situated. If under this new law the President cannot of the Legislature to make the law; of the Executive to execute; and of the Judiciary to
create a barrio, he cannot create municipalities which are composed of several barrios construe the law. The Legislature has no authority to execute or construe the law; the
(See Republic Act No. 5185). Executive has no authority to make or construe the law; and the judiciary has no
For creation of barrios, see Revised Barrio Charter (Republic Act No. 3590).— -power to make or execute the law. Subject to the Constitution only, the power of each
JUDGE JORGE COQUIA branch is supreme within its own jurisdiction, and it is for the judiciary only to say
597 when any Act of the Legislature is or is not constitutional. (U.S. vs. Ang Tang Ho, 48
Phil. 1).
VOL. 15, DECEMBER 24, 1965 597
IV. Scope of the principle of separation of powers.
Pelaez vs. Auditor General The three departments of the government are co-ordinate, co-important, co-equal and
A N N O T A T I O N independent of each other; that each of the several departments of the government
derives its authority directly or indirectly from the people and is responsible to them;
VALID DELEGATION OF LEGISLATIVE POWER
that each has exclusive cognizance of the matters within its jurisdiction and is
I. Principle of separation of powers. supreme within its own sphere. In the exercise of the powers of government assigned
The separation of powers is a fundamental principle in our system of government. It to them severally, the departments operate harmoniously and independently of the
obtains not through express provision but by actual division in our Constitution. Each others and the action of any one of them in the exercise of its powers is not subject to
department of the government has exclusive cognizance of matters within its the control by either of the others. (Province of Tarlac vs. Gale, 26 Phil.
jurisdiction and is supreme within its own sphere. (Angara vs. Electoral Commission, 338; Barcelona vs. Baker, 5 Phil. 87).
et al., 63 Phil. 139).
V. Principle of checks and balances.
II. Constitutional provisions on separation of powers. It does not follow from the fact that the three powers are to be kept separate and
The Legislative power shall be vested in a Congress of the Philippines which shall distinct that the Constitution intended them to be absolutely unrestrained and
consist of a Senate and a House of Representatives. (Article VI, Sec, I, Phil. independent of each other. The Constitution has provided for
Constitution). 599
VOL. 15, DECEMBER 24, 1965 599
Page 11 of 13
law in decisions forbidding the delegation of judicial power, and found its way into
America as an enlightened principle of free Government. It has since become an
the elaborate system of checks and balances to secure coordination in the workings of
accepted corollary of the principle of separation of powers. (People vs. Vera, supra).
various departments of the government For example, the Chief Executive under our
Constitution in so far made a check on the Legislative power that his assent is VIII. Exceptions to the principle of non-delegation.
required in the enactment of laws. This, however, is subject to the further check that a The rule, however, which forbids the delegation of legislative power is not absolute
bill may become a law notwithstanding the refusal of the President to approve it, by a and inflexible, It admits of exceptions, An exception sanctioned by immemorial
vote of two-thirds or threefourths as the case may be, of the National Assembly. The practice permits the central legislative body to delegate legislative power to local
President has also the right to convene the Assembly in special session whenever he authorities. On quite the same principle, Congress is empowered to delegate
chooses, On the other hand, the National Assembly operates as a check on the legislative power to such agencies in the territories of the United States as it may
Executive in the sense that its consent through the Commission on Appointments is select. Courts have also sustained the delegation of legislative powers to the people at
necessary in the appointment of certain officers; and the concurrence of a majority of large, though some authorities maintain that this may not be done, Doubtless, also,
all its members is essential to the conclusion of treaties. Furthermore, in Its power to legislative power may be delegated by the
determine what courts, other than the Supreme Court shall be established, to define 601
their jurisdiction and to appropriate funds for the support, the National Assembly VOL. 15, DECEMBER 24, 1965 601
exercises to a certain ,extent control over the judicial power of trying impeachments
and the judiciary in turn, with the Supreme Court as the final arbiter, effectively Pelaez vs. Auditor General
checks the other departments in the exercise of its power to determine the law, and Constitution itself. Section 14, paragraph 2 of Article VI of the Constitution of the
hence, to declare executive and legislative acts void if violative of the Philippines provides that "the National Assembly may by law authorize the President,
Constitution. (Angara vs. Electoral Commission, supra). subject to such limitations and restrictions as it may impose, to fix within specified
limits, tariff rates, import or export quotas, and tonnage and wharfage dues." In times
VI. Principle of non-delegation of powers. of war or other national emergency, the National Assembly may by law authorize the
The maxim of Constitutional law forbidding the delegation of legislative power should President, for a limited period and subject to such restrictions as it may prescribe, to
be zealously protected. "The true distinction, therefore, is between the delegation of promulgate rules and regulations to carry out a declared national policy. (People vs.
power to make the law, which necessarily involves a discretion as to what it shall be Vera, supra).
and conferring authority or discretion as to its execution, to be exercised under and in The provision of section 1 of Commonwealth Act No. 548 does not confer
pursuance of the law. The first cannot be done; to the latter no valid objection can be legislative power upon the Director of Public Works and the Secretary 01 Public
made." (Cincinnati, W. & Z. R. Co. vs. Comrs. Clinton County, 1 Ohio St. 88) Rubi vs. Works and Communications. The authority conferred upon them and under which
Province of Mindoro, 39 Phil. 662. they promulgated the rules and regulations now complained of is not to determine
Thus, an Act of the Philippine Legislature giving to the Board of Public Utility what public policy demands but merely to carry out the legislative policy laid down by
Commissioners power to require the National Assembly in said Act, to wit, to promote safe transit upon, and avoid
600 obstruction on roads and streets designated as national roads by Acts of the National
600 SUPREME COURT REPORTS ANNOTATED Assembly and to close them temporarily to any or all classes of traffic "whenever the
condition of the road or the traffic thereon makes such action necessary or advisable
in the public convenience and interest." The delegated power, if at all, therefore, is not
public utility "to furnish annually a detailed report of finances and operations, in such
the determination of what the law shall be, but merely the ascertainment of the facts
form and containing such matters as the Board may from time to time by order
and circumstances upon which the application of said law is to be
prescribe" is invalid for the reason that it is a delegation of legislative power to the
predicated. (Calalang vs. Williams, 70 Phil. 726).
Board of Public Utility Commissioners and is in violation of the Act of July 1,
1902. (Compañia General de Tabacos de Filipinas vs. Board of Public Utility IX. Tests of undue delegation.
Commissioners, 34 Phil. 137). In testing whether a statute constitutes an undue delegation of legislative power or
not, it is usual to inquire whether the statute was complete in all its terms and
VII. Delegation of legislative power; historical development.
provisions when it left the hands of the legislature so that nothing is left to the
The power to make laws—the legislative power—is vested in a bicameral Legislature
judgment of any other appointee or delegate of the legislature. In U.S. vs. Ang Tang
by the Jones Law and in a unicameral National Assembly by the Constitution. The
Ho (43 Phil. 1) the Supreme Court adhered to the foregoing rule. The general rule,
Philippine Legislature or the National Assembly may not escape Its duties and
however, is limited by another
responsibilities by delegating that power to any other body or authority. Any attempt
602
to abdicate the power is unconstitutional and void, on the principle that potestas
delegata, non delegare potest. This principle is said to have originated with the 602 SUPREME COURT REPORTS ANNOTATED
glossators, was. introduced into English, law through a misreading of Bracton, there Pelaez vs. Auditor General
developed as a principle of agency, was established by Lord Coke in the English public
Page 12 of 13
rule that to a certain extent matters of detail may be left to be filled in by rules and circumstances. Without denying the right of self-government and the propriety of
regulations to be adopted or promulgated by executive officers and administrative leaving matters of purely local concern in the hands of local authorities or for the
boards. As a rule, an act of the legislature is incomplete and hence, invalid if it does people of small communities to pass upon in the matters of general legislation like
not lay down by any rule or definite standard by which the administrative board may that which treats of criminals in general, and as regards the general subject of
be guided in the exercise of the discretionary powers delegated to it. (People vs. Vera, probation, discretion may not be vested in a manner so unqualified and absolute as
supra). provided in Act No. 4221. (People vs. Vera, supra).
In one case, appellants argue that, while Act No. 2581 empowers the Insular X. Distinction between power to make laws and discretion as to its execution.
Treasurer to issue and cancel certificates or permits for the sale of speculative The true distinction is between the delegation of power to make the law, which
securities, no standard or rule is fixed in the Act which can guide said official in necessarily involves a discretion
determining the cases in which a certificate or permit ought to be issued, thereby 604
making his opinion the sole criterion in the matter of its issuance, with the result that
legislative powers being unduly delegated to the Insular Treasurer, Act No. 2581 is 604 SUPREME COURT REPORTS ANNOTATED
unconstitutional. The Court is of the opinion that the Act furnishes a sufficient Abaño vs. Aguipo
standard for the Insular Treasurer to follow in reaching a decision regarding the as to what it shall be, and conferring an authority or discretion as to its execution, to
issuance or cancellation of a certificate or permit, be exercised under and in pursuance of the law. The first cannot be done; to the latter
In view of the intention and purpose of Act No. 2581—to protect the public against no valid objection can be made. (Cincinnati, W. & Z. R. Co. vs. Clinton Country
"speculative schemes which have no more basis than so many feet of blue sky" and Commissioners, 1 Ohio St. 77, 88.). See also Sutherland on Statutory Construction,
against the "sale of stock in fly-by-night concerns, visionary oil wells, distant gold sec. 68. To the same effect are decisions of the Supreme Court in the Municipality of
mines and other like fraudulent exploitations,"—the Court was inclined to hold that Cardona vs. Municipality of Binañgonan, 36 Phil 547; Rubi vs. Provincial Board of
"public interest" in this case is suf f icient standard to guide the Insular Treasurer, in Mindoro, 39 Phil. 860; Cruz vs. Youngberg, 56 Phil. 234; People vs. Vera, supra.—
reaching a decision on a matter pertaining to the issuance of certificates or ATTY. JULIANA B. DE CASTRO,
permits. (People vs. Rosenthal, 68 Phil. 328). Note.—When delegation of legislative powers is not alIowed. It was not the
The Legislature cannot delegate legislative power to enact any law. If Act No. intention of Congress, in enacting Republic Act No. 997, to authorize the transfer of
2868 is a law unto itself and within itself, and it does nothing more than to authorize powers and jurisdiction of the courts of justice to the officials to be appointed or
the Governor General to make rules and regulations to carry it into effect, then the offices to be created by the Reorganization Plan. Congress is well aware of the
Legislature created the law. There is no delegation of power and it is valid. On the provision of the Constitution that judicial powers are vested "only in the Supreme
other hand, if the Act within itself does not define the crime and it is not complete, Court and in such courts as the law may establish." The Reorganization Commission
and some legislative act renains to be done to make it a law or a crime the doing was not authorized to create courts of justice, or to take away from them their
603 jurisdiction and transfer said jurisdiction to create courts of justice, or take away from
VOL. 15, DECEMBER 24, 1965 603 them their jurisdiction and transfer said jurisdiction to the officials appointed or
offices created under the Reorganization Plan. The Legislature may not and cannot
delegate its power to legislate or create courts of justice to any other agency of the
of which is vested in the Governor General, the Act is a delegation of legislative power, Government. (Chinese Flour Importers' Association vs. Price Stabilization Board, L-
and is unconstitutional and void. (People vs. Vera, supra). 4465, July 12, 1961; U.S. vs. Shrevoport, 287 U.S. 7777, L. Ed. 175 and Johnson vs.
The Probation Act does not, by the force of any of Its provisions, fix and impose San Diego, 42 P. 249, cited in 11 Am, Jur. 921-922), Corominas. Jr. vs. Labor
upon the provincial boards any standard or guide in the exercise of their discretionary Standards Commission, 2 SCRA 721.
power. What is granted is a "roving commission'' which enables the provincial boards
to exercise arbitrary discretion. By section 11 of the Act, the Legislature does
seemingly on its own authority extend the benefits of the probation Act to the _______________
provinces but in reality leaves the entire matter for the various provincial boards to
determine. If a provincial board does not wish to have the Act applied in its province,
all that it has to do is to decline to appropriate the needed amount for the salary of a
probation officer. This is a virtual surrender of legislative power to the provincial
boards. (People vs. Vera, supra).
The legislature may enact laws for a particular locality different from those
applicable to other localities and while recognizing the f orce of the principle
hereinabove expressed, courts in many jurisdictions have sustained the
constitutionality of the submission of option laws to the vote of the people. (6 R.C.L.
171). But option laws thus sustained treat of subjects purely local in character which
should receive different treatment in different localities placed under different
Page 13 of 13

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