RAMON CHING AND POWING PROPERTIES, INC
vs. 
JOSEPH CHENG, JAIME CHENG, MERCEDES IGNE
 G.R. No. 175507,October 8, 2014
​
Joseph Cheng, Jaime Cheng, and Mercedes Igne (the Chengs) filed a complaint for declaration of nullity of titles against Ramon Ching before the Regional Trial Court of Manila.
 
The complaint was amended, with leave of court, to implead additional defendants, Po Wing Properties, of which Ramon Ching was a primary stockholder. The amended complaint was for "Annulment of Agreement, Waiver, Extra-Judicial Settlement of Estate and the Certificates of Title Issued by Virtue of Said Documents with Prayer for Temporary Restraining Order and Writ of Preliminary Injunction.
 
After the responsive pleadings had been filed, Po Wing Properties filed a motion to dismiss on the ground of lack of jurisdiction of the subject matter. The Regional Trial Court of Manila, Branch 6, granted the motion to dismiss. Upon motion of the Chengs’ counsel, however, the Chengs and Lucina Santos were given fifteen (15) days to file the appropriate pleading. They did not do so.
 
The Chengs and Lucina Santos filed a complaint for "Annulment of Agreement, Waiver, Extra-Judicial Settlement of Estate and the Certificates of Title Issued by Virtue of Said Documents with Prayer for Temporary Restraining Order and Writ of Preliminary Injunction" against Ramon Ching and Po Wing Properties (the second case) and raffled to Branch 20 of the Regional Trial Court of Manila. When Branch 20 was made aware of the first case, it issued an order transferring the case to Branch 6, considering that the case before it involved substantially the same parties and causes of action.
 
The Chengs and Lucina Santos filed a motion to dismiss their complaint in the second case, praying that it be dismissed without prejudice. RTC Branch 6 issued an order granting the motion to dismiss on the basis that the summons had not yet been served on Ramon Ching and Po Wing Properties, and they had not yet filed any responsive pleading. The dismissal of the second case was made without prejudice.
 
Ramon Ching and Po Wing Properties filed a motion for reconsideration of the order dated November 22, 2002. They argue that the dismissal should have been with prejudice under the "two dismissal rule" of Rule 17, Section 1 of the 1997 Rules of Civil Procedure, in view of the previous dismissal of the first case.
 
During the pendency of the motion for reconsideration, the Chengs and Lucina Santos filed a complaint for "Disinheritance and Declaration of Nullity of Agreement and Waiver, Affidavit of Extra judicial Agreement, Deed of Absolute Sale, and Transfer Certificates of Title with Prayer for TRO and Writ of Preliminary Injunction" against Ramon Ching and Po Wing Properties (the third case) and was eventually raffled to Branch 6.
 
Ramon Ching and Po Wing Properties filed their comment/opposition to the application for temporary restraining order in the third case. They also filed a motion to dismiss on the ground of res judicata, litis pendencia, forum-shopping, and failure of the complaint to state a cause of action.
 
RTC Branch 6 issued an omnibus order resolving both the motion for reconsideration in the second case and the motion to dismiss in the third case. The trial court denied the motion for reconsideration and the motion to dismiss, holding that the dismissal of the second case was without prejudice and, hence, would not bar the filing of the third case.
 
while their motion for reconsideration in the third case was pending, Ramon Ching and Po Wing Properties filed a petition for certiorari  with the Court of Appeals, assailing the order which upheld the dismissal of the second case.
 
The trial court issued an order denying the motion for reconsideration in the third case. The denial prompted Ramon Ching and Po Wing Properties to file a petition for certiorari and prohibition with application for a writ of preliminary injunction or the issuance of a temporary restraining order with the Court of Appeals.
 
The Court of Appeals rendered the decision in the first certiorari case dismissing the petition. The appellate court ruled that Ramon Ching and Po Wing Properties’ reliance on the "two-dismissal rule" was misplaced since the rule involves two motions for dismissals filed by the plaintiff only. Upon the denial of their motion for reconsideration, Ramon Ching and Po Wing Properties filed this present petition for review under Rule 45 of the Rules of Civil Procedure.

Issue:
Whether or not the trial court’s dismissal of the second case operated as a bar to the filing of a third case, as per the "two-dismissal rule".

Held: 
No. Rule 17 of the Rules of Civil Procedure governs dismissals of actions at the instance of the plaintiff. Hence, the "two-dismissal rule" under Rule 17, Section 1 of the Rules of Civil Procedure will not apply if the prior dismissal was done at the instance of the defendant. Dismissals upon the instance of the defendant are generally governed by Rule 16, which covers motions to dismiss.
 
As a general rule, dismissals under Section 1 of Rule 17 are without prejudice except when it is the second time that the plaintiff caused its dismissal. Accordingly, for a dismissal to operate as an adjudication upon the merits, i.e, with prejudice to the re-filing of the same claim, the following requisites must be present:
(1) There was a previous case that was dismissed by a competent court;
(2) Both cases were based on or include the same claim;
(3) Both notices for dismissal were filed by the plaintiff; and
(4) When the motion to dismiss filed by the plaintiff was consented to by the defendant on the ground that the latter paid and satisfied all the claims of the former.
 
The purpose of the "two-dismissal rule" is "to avoid vexatious litigation." When a complaint is dismissed a second time, the plaintiff is now barred from seeking relief on the same claim.
 
The dismissal of the second case was without prejudice in view of the "two-dismissal rule"
 
Here, the first case was filed as an ordinary civil action. It was later amended to include not only new defendants but new causes of action that should have been adjudicated in a special proceeding. A motion to dismiss was inevitably filed by the defendants on the ground of lack of jurisdiction.
 
The dismissal of the first case was done at the instance of the defendant under Rule 16, Section 1(b) of the Rules of Civil Procedure, which states:
Section 1. Grounds.— Within the time for but before filing the answer to the complaint or pleading asserting a claim, a motion to dismiss may be made on any of the following grounds:
(b) That the court has no jurisdiction over the subject matter of the claim;
Under Section 5 of the same rule, a party may re-file the same action or claim subject to certain exceptions.
 
Thus, when respondents filed the second case, they were merely refiling the same claim that had been previously dismissed on the basis of lack of jurisdiction. When they moved to dismiss the second case, the motion to dismiss can be considered as the first dismissal at the plaintiff’s instance.
 
When respondents filed the third case on substantially the same claim, there was already one prior dismissal at the instance of the plaintiffs and one prior dismissal at the instance of the defendants.
 
While it is true that there were two previous dismissals on the same claim, it does not necessarily follow that the re-filing of the claim was barred by Rule 17, Section 1 of the Rules of Civil Procedure. The circumstances surrounding each dismissal must first be examined to determine before the rule may apply, as in this case. Thus, the trial court's dismissal of the second case is not a bar to the filing of the third case.

​Chavez vs National Housing Authority
G.R No 164527

Facts:
Petitioner Francisco Chavez in his capacity as taxpayer seeks to declare null and void the Joint Venture Agreement between the NHA and R-II Builder’s, Inc (RBI) for being unconstitutional and invalid, and to enjoin respondents — particularly respondent NHA – from implementing and/or enforcing the said project and other agreements related thereto. On March 1, 1988, then President Corazon C. Aquino issued Memorandum Order No. 161 approving and directing the implementation of the Comprehensive and Integrated Metropolitan Manila Waste Management Plan. Specifically, respondent NHA was ordered to “conduct feasibility studies and develop low-cost housing projects at the dumpsite and absorb scavengers in NHA resettlement/low-cost housing projects.”

Pursuant to MO 161-A, NHA prepared the feasibility studies which resulted in the formulation of the Smokey Mountain Development Plan and Reclamation of the Area Across R-10 or the Smokey Mountain Development and Reclamation Project. SMDRP aimed to convert the Smokey Mountain dumpsite into a habitable housing project, inclusive of the reclamation of the area across R-10, adjacent to the Smokey Mountain as the enabling component of the project. Once finalized, the plan was submitted to President Aquino for her approval. On January 17, 1992, President Aquino proclaimed MO 415, approving and directing the implementation of the SMDRP through a private sector joint venture. Said MO stipulated that the land area covered by the Smokey Mountain dumpsite is conveyed to the NHA as well as the area to be reclaimed across R-10. In the same MO 415, President Aquino created an Executive Committee to oversee the implementation of the plan and an inter-agency Technical Committee was created composed of the technical representatives of the EXECOM. Based on the evaluation of the pre-qualification documents, the EXECOM declared the New San Jose Builders, Inc. and RBI as top two contractors. Thereafter, TECHCOM submitted its recommendation to the EXECOM to approve the RBI proposal which garnered the highest score.

On October 7, 1992, President Ramos authorized NHA to enter into a JVA with RBI. Afterwards, President Ramos issued Proclamation No. 465 increasing the proposed area for reclamation across R-10 from 40 hectares to 79 hectares. On September 1, 1994, pursuant to Proclamation No. 39, the DENR issued Special Patent No. 3591 conveying in favor of NHA an area of 211,975 square meters covering the Smokey Mountain Dumpsite.  The land reclamation was completed in August 1996. Sometime later in 1996, pursuant likewise to Proclamation No. 39, the DENR issued Special Patent No. 3598 conveying in favor of NHA an additional 390,000 square meter area. After some time, the JVA was terminated. RBI demanded the payment of just compensation for all accomplishments and costs incurred in developing the SMDRP plus a reasonable rate of return. In a Memorandum of Agreement (MOA) executed by NHA and RBI, both parties agreed to terminate the JVA and other subsequent agreements, which stipulated, among others, that unpaid balance may be paid in cash, bonds or through the conveyance of properties or any combination thereof. On August 5, 2004, former Solicitor General Francisco I. Chavez filed this Petition for Prohibition and Mandamus seeking to declare null and void the Joint Venture Agreement and the Smokey Mountain Development and Reclamation Project, and all other agreements in relation thereto, for being Unconstitutional and Invalid. The petitioner challenges the authority of NHA to reclaim lands. He claims that the power to reclaim lands of public domain is vested exclusively with the Public Estates Authority. He also contends that NHA and RBI were not given the power and authority by DENR to reclaim foreshore and submerged lands, as required and that there was no proclamation officially classifying the reclaimed lands as alienable and disposable.

Issue:
Whether or not the NHA has the authority to reclaim lands.

Held:
Yes. While the authority of NHA to reclaim lands is challenged by petitioner, we find that the NHA had more than enough authority to do so under existing laws. While PD 757, the charter of NHA, does not explicitly mention “reclamation” in any of the listed powers of the agency, we rule that the NHA has an implied power to reclaim land as this is vital or incidental to effectively, logically, and successfully implement an urban land reform and housing program enunciated in Sec. 9 of Article XIII of the 1987 Constitution. Basic in administrative law is the doctrine that a government agency or office has express and implied powers based on its charter and other pertinent statutes. Express powers are those powers granted, allocated, and delegated to a government agency or office by express provisions of law. On the other hand, implied powers are those that can be inferred or are implicit in the wordings of the law or conferred by necessary or fair implication in the enabling act. When a general grant of power is conferred or duty enjoined, every particular power necessary for the exercise of the one or the performance of the other is also conferred by necessary implication. when the statute does not specify the particular method to be followed or used by a government agency in the exercise of the power vested in it by law, said agency has the authority to adopt any reasonable method to carry out its functions. The power to reclaim on the part of the NHA is implicit from PD 757, RA 7279, MO 415, RA 6957, and PD 3- A. Land reclamation is an integral part of the development of resources for some of the housing requirements of the NHA. Private participation in housing projects may also take the form of land reclamation.

​Globe Wireless vs. Public Service Commission
G.R No. L-27520 

FACTS:
​Globe Wireless, Ltd., a duly organized Philippines corporation engaged in international telecommunication business under a franchise granted by Public Acts Nos. 3495, 3692 and 4150 as amended by Republic Act No. 4630. A message addressed to Maria Diaz, Monte Esquina 30, Madrid, Spain, filed by private respondent Antonio B. Arnaiz with the telegraph office of the Bureau of Telecommunications in Dumaguete City was transmitted to the Bureau of Telecommunications in Manila. It was forwarded to petitioner Globe Wireless Ltd. for transmission to Madrid. Petitioner sent the message to the American Cable and Radio Corporation in New York, which, in turn, transmitted the same to the Empresa Nacional de Telecommunicaciones in Madrid. The latter, however, mislaid said message, resulting in its non-delivery to the addressee. After being informed of said fact, private respondent Arnaiz, sent to then Public Service Commissioner Enrique Medina an unverified letter-complaint relating the incident.

Hearing ensued, after which the PSC issued an order finding petitioner "responsible for the inadequate and unsatisfactory service complained of, in violation of the Public Service Act" and ordering it "to pay a fine of TWO HUNDRED [P200.00] PESOS under Sec. 21 of Com. Act 146, as amended." petitioner was likewise required to refund the sum of P19.14 to the remitter of the undelivered message.

Issue:
Whether or not the PSC exceeded to their jurisdiction to the franchisee.

Held:
The basic in administrative law to need citation of jurisprudence is the rule that the jurisdiction 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 beyond such jurisdiction is void and ineffective. PRINCIPLES: Commonwealth Act No. 146 Sec. 5. The Public Service Commission is hereby given jurisdiction over the grantee only with respect to the rates which the grantee may charge the public subject to international commitments made or adhered to by the Republic of the Philippines. Section 21 of C.A. No. 146, as amended, the Commission was empowered to impose an administrative fine in cases of violation of or failure by a Public service to comply with the terms and conditions of any certificate or any orders, decisions or regulations of the Commission. Globe Wireless Ltd. operated under a legislative franchise, so there were no terms nor conditions of any certificate issued by the Commission to violate.

​Padua v. Ranada
G.R. No. 141949

Facts:
The Toll Regulatory Board (TRB) issued Resolution No. 2001-89 authorizing provisional toll rate adjustments on November 9, 2001, at the Metro Manila Skyway, effective January 1, 2002. For its implementation starting January 1, 2002 after its publication once a week for three (3) consecutive weeks in a newspaper of general circulation and that said Provisional Toll Rate Increase shall remain in effect until such time that the TRB Board has determined otherwise: On December 17, 24 and 31, 2001, the above Resolution approving provisional toll rate adjustments was published in the newspapers of general circulation. Tracing back the events that led to the issuance of the said Resolution, it appears that on February 27, 2001 the Citra Metro Manila Tollways Corporation (CITRA) filed with the TRB an application for an interim adjustment of the toll rates at the Metro Manila Skyway Project – Stage 1. CITRA moored its petition on the provisions of the (STOA)"Supplemental Toll Operation Agreement" , authorizing it, as the investor, to apply for and if warranted, to be granted an interim adjustment of toll rates in the event of a "significant currency devaluation." Claiming that the peso exchange rate to a U.S. dollar had devaluated from P26.1671 in 1995 to P48.00 in 2000, CITRA alleged that there was a compelling need for the increase of the toll rates to meet the loan obligations of the Project and the substantial increase in debt-service burden. 

On October 30, 2001, CITRA moved to withdraw its "Urgent Motion for Provisional Approval" without prejudice to its right to seek or be granted provisional relief under the above-quoted provisions of the TRB Rules of Procedure, obviously, referring to the power of the Board to act on its own initiative. On November 9, 2001, TRB granted CITRA’s motion to withdraw the Urgent Motion for Provisional Approval and, at the same time, issued Resolution No. 2001-89, earlier quoted. Hence, petitioners Ceferino Padua and Eduardo Zialcita assail before this Court the validity and legality of TRB Resolution No. 2001-89.

Issue:
​Whether or not Resolution No. 2001-89 issued by the Toll Regulatory Board valid.

Held:
For one, it is not true that the provisional toll rate adjustments were not published prior to its implementation on January 1, 2002. Records show that they were published on December 17, 24 and 31, 2001 in three newspapers of general circulation, particularly the Philippine Star, Philippine Daily Inquirer and The Manila Bulletin. Surely, such publications sufficiently complied with Section 5 of P.D. No. 1112 which mandates that "no new rates shall be collected unless published in a newspaper of general publication at least once a week for three consecutive weeks." At any rate, it must be pointed out that under Letter of Instruction No. 1334-A, the TRB may grant and issue ex-parte to any petitioner, without need of notice, publication or hearing, provisional authority to collect, pending hearing and decision on the merits of the petition, the increase in rates prayed for or such lesser amount as the TRB may in its discretion provisionally grant. That LOI No. 1334-A has the force and effect of law finds support in a catena of cases decreeing that "all proclamations, orders, decrees, instructions, and acts promulgated, issued, or done by the former President (Ferdinand E. Marcos) are part of the law of the land, and shall remain valid, legal, binding, and effective, unless modified, revoked or superseded by subsequent proclamations, orders, decrees, instructions, or other acts of the President. It may be recalled that Former President Ferdinand E. Marcos promulgated P.D. No. 1112 creating the TRB on March 31, 1977. The end in view was to authorize the collection of toll fees for the use of certain public improvements in order to attract private sector investment in the government infrastructure projects. The TRB was tasked to supervise the collection of toll fees and the operation of toll facilities. One of its powers is to "issue, modify and promulgate from time to time the rates of toll that will be charged the direct users of toll facilities and upon notice and hearing, to approve or disapprove petitions for the increase thereof. To clarify the intent of P.D. No. 1112 as to the extent of the TRB’s power, Former President Marcos further issued LOI No. 1334-A expressly allowing the TRB to grant ex-parte provisional or temporary increase in toll rates

​Dacudao vs. Gonzales
G.R No. 188056

Facts:
Petitioners,  residents of Bacaca Road, Davao City - were among the investors whom Celso G. Delos Angeles, Jr. and his associates in the Legacy Group of Companies (Legacy Group) allegedly defrauded through the Legacy Group's "buy back agreement" that earned them check payments that were dishonored. After their written demands for the return of their investments went unheeded, they initiated a number of charges for syndicated estafa against Delos Angeles, Jr., et al. in the Office of the City Prosecutor of Davao City on February 6, 2009. On March 18, 2009, the Secretary of Justice issued Department of Justice (DOJ) Order No. 182 (DO No. 182), directing all Regional State Prosecutors, Provincial Prosecutors, and City Prosecutors to forward all cases already filed against Delos Angeles, Jr., et al. to the Secretariat of the DOJ Special Panel in Manila for appropriate action. Pursuant to DO No. 182, the complaints of petitioners were forwarded by the Office of the City Prosecutor of Davao City to the Secretariat of the Special Panel of the DOJ. Aggrieved by such turn of events, petitioners have directly come to the Court via petition for certiorari, prohibition and mandamus, ascribing to respondent Secretary of Justice grave abuse of discretion in issuing DO No. 182.

They claim that DO No. 182 violated their right to due process, their right to the equal protection of the laws, and their right to the speedy disposition of cases. They insist that DO No. 182 was an obstruction of justice and a violation of the rule against enactment of laws with retroactive effect.

Issue:
Whether or not respondent Secretary of Justice committed grave abuse of discretion in issuing DO No. 182.

Held:
No. For a special civil action for certiorari to prosper, the following requisites must concur, namely: (a) it must be directed against a tribunal, board or officer exercising judicial or quasi-judicial functions; (b) the tribunal, board, or officer must have acted without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (c) there is no appeal nor any plain, speedy, and adequate remedy in the ordinary course of law. Yet, petitioners have not shown a compliance with the requisites. To start with, they merely alleged that the Secretary of Justice had acted without or in excess of his jurisdiction. Also, the petition did not show that the Secretary of Justice was an officer exercising judicial or quasi-judicial functions. Instead, the Secretary of Justice would appear to be not exercising any judicial or quasi-judicial functions because his questioned issuances were ostensibly intended to ensure his subordinates’ efficiency and economy in the  conduct of the preliminary investigation of all the cases involving the Legacy Group.

​The function involved was purely executive or administrative. The fact that the DOJ is the primary prosecution arm of the Government does not make it a quasi-judicial office or agency. Its preliminary investigation of cases is not a quasi-judicial proceeding. Nor does the DOJ exercise a quasi-judicial function when it reviews the findings of a public prosecutor on the finding of probable cause in any case. The prosecutor in a preliminary investigation does not determine the guilt or innocence of the accused. He does not exercise adjudication nor rule-making functions. Preliminary investigation is merely inquisitorial, and is often the only means of discovering the persons who may be reasonably charged with a crime and to enable the fiscal to prepare his complaint or information. It is not a trial of the case on the merits and has no purpose except that of determining whether a crime has been committed and whether there is probable cause to believe that the accused is guilty thereof. While the fiscal makes that determination, he cannot be said to be acting as a quasi-court, for it is the courts, ultimately, that pass judgment on the accused, not the fiscal.

​Dario vs. Mison
G.R No. 81954

Facts:
In 1986, Cory Aquino promulgated Proclamation No. 3, which is the mandate of the people to Completely reorganize the government. Two years later, President Aquino promulgated EO 127, which provides for the reorganization of the Ministry of Finance and along with it the reorganization of the Bureau of Customs and prescribes a new staffing pattern for the abovementioned office.  Following the adoption of the new Constitution, On January 1988 the incumbent Commissioner of Customs Salvador Mison issued a memorandum “Guidelines on the Implementation of Reorganization Executive Orders which prescribes the procedure in personnel placement. Such memorandum provides that by February of 1988, all of the employees covered by EO 127 shall be informed of their re-appointment and also offered another position in the same department or agency and to be informed of their termination.
​
Mison addressed several notices to various Customs officials stating that they shall continue to perform their respective duties and responsibilities in a hold-over capacity, and that those incumbents whose positions are not carried in the new reorganization pattern, or who are not re-appointed, shall be deemed separated from the service.

A total of 394 officials and employees of the Bureau of Customs were given individual notices of separation. They filed appeals with the CSC. On June 1988, the CSC promulgated its ruling ordering the reinstatement of the 279 employees, the 279 private respondents in G.R. No. 85310. Commissioner Mison, represented by the Solicitor General, filed a motion for reconsideration, which was denied. Commissioner Mison instituted certiorari proceedings. On June 10, 1988, Republic Act No. 6656, was signed into law and according to the provisions of the aforementioned Act, the process in which terminated employees in violation of RA 6656 shall be reinstated or reappointed. On June 23, 1988, Benedicto Amasa and William Dionisio, customs examiners appointed by Commissioner Mison pursuant to the ostensible reorganization subject of this controversy, petitioned the Court to contest the validity of the statute.

On October 21, 1988, thirty-five more Customs officials whom the Civil Service Commission had ordered reinstated by its June 30, 1988 Resolution filed their own petition to compel the Commissioner of Customs to comply with the said Resolution. Cesar Dario was one of the Deputy Commissioners of the Bureau of Customs until his relief on orders of Commissioner Mison on January 26, 1988. In essence, he questions the legality of his dismissal, which he alleges was upon the authority of Section 59 of E.O. No. 127 He contends that neither the E.O. nor the staffing pattern proposed by the Secretary of Finance abolished the office of Deputy Commissioner of Customs, but, rather, increased it to three. Nor can it be said, so he further maintains, that he had not been "reappointed" because "reappointment therein presupposes that the position to which it refers is a new one in lieu of that which has been abolished or although an existing one, has absorbed that which has been abolished." Lastly, he claims, that under the Provisional Constitution, the power to dismiss public officials without cause ended on February 25, 1987, and that thereafter, public officials enjoyed security of tenure under the provisions of the 1987 Constitution.

Vicente Feria asserts his security of tenure and that he cannot be said to be covered by Section 59 of E.O. No. 127, having been appointed on April 22, 1986 - during the effectivity of the Provisional Constitution. He adds that under E.O. No. 39, the Commissioner of Customs has the power "to appoint all Bureau personnel, except those appointed by the President," and that his position, which is that of a Presidential appointee, is beyond the control of Commissioner Mison for purposes of reorganization. Provisions of Section 16, Article XVIII explicitly authorize the removal of career civil service employees "not for cause but as a result of the reorganization pursuant to Proclamation No. 3 dated March 25, 1986 and the reorganization following the ratification of this Constitution. For this reason, Mison posits, claims of violation of security of tenure are allegedly no defense. That contrary to the employees' argument, Section 59 of E.O.no. 127 is applicable, in the sense that retention in the Bureau, under the E.O., depends on either retention of the position in the new staffing pattern or reappointment of the incumbent, and since the dismissed employees had not been reappointed, they had been considered legally separated. Moreover, Mison proffers that under Section 59 incumbents are considered on holdover status, "which means that all those positions were considered vacant."

Issue:
Whether or not Section 16 of Article XVIII of the 1987 Constitution is a grant of a license upon the Government to remove career public officials it could have validly done under an "automatic"- vacancy-authority and to remove them without rhyme or reason.

Held:
No. The Court held that the State can still carry out reorganizations provided that it is done in good faith. Removal of career officials without cause cannot be done after the passing of the 1987 Constitution. The above is a mere recognition of the right of the Government to reorganize its offices, bureaus, and instrumentalities. Under Section 4, Article XVI, of the 1935 Constitution. Transition periods are characterized by provisions for "automatic" vacancies. They are dictated by the need to hasten the passage from the old to the new Constitution free from the "fetters" of due process and security of tenure. Since 1935, transition periods have been characterized by provisions for "automatic" vacancies. We take the silence of the 1987 Constitution on this matter as a restraint upon the Government to dismiss public servants at a moment's notice. If the present Charter envisioned an "automatic" vacancy, it should have said so in clearer terms. Plainly the concern of Section 16 is to ensure compensation for "victims" of constitutional revamps - whether under the Freedom or existing Constitution - and only secondarily and impliedly, to allow reorganization.  In order to be entitled to the benefits granted under Section 16 of Article XVIII of the Constitution of 1987, two requisites, one negative and the other positive, must concur, to wit: 1. The separation must not be for cause, and 2. The separation must be due to any of the three situations mentioned. By its terms, the authority to remove public officials under the Provisional Constitution ended on February 25, 1987, advanced by jurisprudence to February 2, 1987. It can only mean, then, that whatever reorganization is taking place is upon the authority of the present Charter, and necessarily, upon the mantle of its provisions and safeguards. Hence, it cannot be legitimately stated that we are merely continuing what the revolutionary Constitution of the Revolutionary Government had started. We are through with reorganization under the Freedom Constitution - the first stage. We are on the second stage - that inferred from the provisions of Section 16 of Article XVIII of the permanent basic document.

After February 2, 1987, incumbent officials and employees have acquired security of tenure. The present organic act requires that removals "not for cause" must be as a result of reorganization. As we observed, the Constitution does not provide for "automatic" vacancies. It must also pass the test of good faith. As a general rule, a reorganization is carried out in "good faith" if it is for the purpose of economy or to make bureaucracy more efficient. In that event, no dismissal (in case of a dismissal) or separation actually occurs because the position itself ceases to exist. And in that case, security of tenure would not be a Chinese wall. Be that as it may, if the "abolition," which is nothing else but a separation or removal, is done for political reasons or purposely to defeat security of tenure, or otherwise not in good faith, no valid "abolition" takes place and whatever "abolition" is done, is void ab initio. There is an invalid "abolition" as where there is merely change of nomenclature of positions, or where claims of economy are belied by the existence of ample funds. The Court finds that Commissioner Mison did not act in good faith since after February 2, 1987 no perceptible restructuring of the Customs hierarchy - except for the change of personnel - has occurred, which would have justified (all things being equal) the contested dismissals. There is also no showing that legitimate structural changes have been made - or a reorganization actually undertaken, for that matter - at the Bureau since Commissioner Mison assumed office, which would have validly prompted him to hire and fire employees. With respect to E.O. No. 127, Commissioner Mison submits that under Section 59 thereof, "Those incumbents whose positions are not included therein or who are not reappointed shall be deemed separated from the service." He submits that because the 394 removed personnel have not been "reappointed," they are considered terminated. To begin with, the Commissioner's appointing power is subject to the provisions of Executive Order No. 39. Under E.O. No. 39, the Commissioner of Customs may "appoint all Bureau personnels except those appointed by the President." Thus, with respect to Deputy Commissioners Cesar Dario and Vicente Feria, Jr., Commissioner Mison could not have validly terminated them, they being Presidential appointees. That Customs employees, under Section 59 of E.O. No. 127 had been on a mere holdover status cannot mean that the positions held by them had become vacant. The occupancy of a position in a holdover capacity was conceived to facilitate reorganization and would have lapsed on 25 February 1987 (under the Provisional Constitution), but advanced to February 2, 1987 when the 1987 Constitution became effective. After the said date the provisions of the latter on security of tenure govern. Hence the petition of the employees was granted while the petition of Mison was dismissed.

The court ordered the reinstatement of the Employees of the Bureau of Customs. 

Crisostomo vs. CA G.R. No. 106296

​Facts:
Petitioner Isabelo Crisostomo was President of the Philippine College of Commerce (PCC),
having been appointed to that position by the President of the Philippines on July 17, 1974.
During his tenure as president of the PCC, two administrative cases were filed against petitioner
for illegal use of government vehicles, misappropriation of construction materials belonging to the
college, oppression and harassment, grave misconduct, nepotism and dishonesty. The
administrative cases, which were filed with the Office of the President, were subsequently referred
to the Office of the Solicitor General for investigation. Charges of violations of R.A. No. 3019and R.A. No. 992, and R.A. No. 733, were likewise filed against him with the Office of Tanodbayan.

​On June 14, 1976, three (3) informations for violation of Sec. 3(e) of the Anti-Graft and Corrupt
Practices Act (R.A. No. 3019, as amended) were filed against him. The informations alleged that
he appropriated for himself a bahay kubo, which was intended for the College, and construction
materials worth P250,000.00, more or less. Petitioner was also accused of using a driver of the
College as his personal and family driver.

On October 22, 1976, petitioner was preventively suspended from office pursuant to R.A. No.
3019, §13, as amended. In his place Dr. Pablo T. Mateo, Jr. was designated as officer-in-charge
on November 10, 1976, and then as Acting President on May 13, 1977.
On April 1, 1978, P.D. No. 1341 was issued by then President Ferdinand E. Marcos,
CONVERTING THE PHILIPPINE COLLEGE OF COMMERCE INTO A POLYTECHNIC
UNIVERSITY, DEFINING ITS OBJECTIVES, ORGANIZATIONAL STRUCTURE AND
FUNCTIONS, AND EXPANDING ITS CURRICULAR OFFERINGS.

Mateo continued as the head of the new University. On April 3, 1979, he was appointed Acting
President and on March 28, 1980, as President for a term of six (6) years.
 
Issue:
Whether or not the Philippine College of Commerce was abolished by the Polytechnic University
of the Philippines in virtue of P.D. No. 1341.
 
 
Held:
Presidential Decree No. 1341 did not abolish, but only changed, the former Philippine College of Commerce into what is now the Polytechnic University of the Philippines, in the same way that earlier in 1952,R.A. No. 778 had converted what was then the Philippine School of Commerce into the Philippine
College of Commerce. What took place was a change in academic status of the educational
institution, not in its corporate life. Hence the change in its name, the expansion of its curricular
offerings, and the changes in its structure and organization.

As petitioner correctly points out, when the purpose is to abolish a department or an office or an
organization and to replace it with another one, the lawmaking authority says so.
The law does not state that the lands, buildings and equipment owned by the PCC were being
"transferred" to the PUP but only that they "stand transferred" to it. "Stand transferred" simply
means, for example, that lands transferred to the PCC were to be understood as transferred to
the PUP as the new name of the institution.

In this case, Dr. Pablo T. Mateo Jr., who had been acting president of the university since April 3,
1979, was appointed president of PUP for a term of six (6) years on March 28, 1980, with the
result that petitioner's term was cut short. In accordance with §7 of the law, therefore, petitioner
became entitled only to retirement benefits or the payment of separation pay. Petitioner must
have recognized this fact, that is why in 1992 he asked then President Aquino to consider him for
appointment to the same position after it had become vacant in consequence of the retirement of
Dr. Prudente.

The decision of the Court of Appeals is MODIFIED by SETTING ASIDE the questioned orders of
the Regional Trial Court directing the reinstatement of the petitioner Isabelo T. Crisostomo to the
position of president of the Polytechnic University of the Philippines and the payment to him of
salaries and benefits which he failed to receive during his suspension in so far as such payment
would include salaries accruing after March 28, 1980 when petitioner Crisostomo's term was
terminated. Further proceedings in accordance with this decision may be taken by the trial court
to determine the amount due and payable to petitioner by the university up to March 28, 1980.