CAGANG vs.

SANDIGANBAYAN
G.R. No. 206458, July 31, 2018
En Banc, J. Leonen

FACTS:
On February 10, 2003, the Office of the Ombudsman received an anonymous
complaint alleging that Amelia May Constantino, Mary Ann Gadian, and Joy Tangan of
the Vice Governor's Office, Sarangani Province committed graft and corruption by
diverting public funds given as grants or aid using barangay officials and cooperatives
as "dummies." The complaint was referred to the Commission on Audit for audit
investigation.
On December 31, 2002, the Commission on Audit submitted its audit report
finding that the officials and employees of the Provincial Government of Sarangani
appear to have embezzled millions in public funds by sourcing out the funds from
grants, aid, and the Countrywide Development Fund of Representative Erwin
Chiongbian using dummy cooperatives and people's organizations.
On September 30, 2003, the Office of the Ombudsman issued a Joint Order
terminating the case. It concurred with the findings of the Commission on Audit and
recommended that a criminal case for Malversation of Public Funds through
Falsification of Public Documents and Violation of Section 3(e) of Republic Act No.
3019 be filed against the public officers named by the Commission on Audit in its
Summary of Persons that could be held liable on the Irregularities.
The criminal complaint against petitioner was filed on February 10,
2003. On August 11, 2004, the Office of the Ombudsman issued a
Resolution finding probable cause against petitioner. This Resolution,
however, was modified by the Resolution dated October 18, 2004, which
ordered the conduct of further fact-finding investigation against some of the other
respondents in the case. This further fact-finding was resolved by the
Office of the Ombudsman on April 12, 2005. On August 8, 2011, or six (6) years after
the recommendation to file infonnations against petitioner was approved by
Tanodbayan Marcelo, Assistant Special Prosecutor II Pilarita T. Lapitan submitted the
informations for Ombudsman Carpio Morales' review. Informations against petitioner
were filed on November 17, 2011.

Respondent alleged that the delay in the filing of the informations was
justified since it was still determining whether accused Mary Ann Gadian
(Gadian) could be utilized as a state witness and it still had to verify accused
Felipe Constantino's death. The recommendation, however, to utilize
Gadian as a state witness was approved by Tanodbayan Marcelo on
December 20, 2004. 163 Felipe Constantino's death was verified by the
Sandiganbayan in its November 14, 2006 Order. 164 There is, thus, delay
from November 14, 2006 to August 8, 2011.

While there is delay from November 14, 2006 to August 8, 2011. This Court
finds, however, that despite the pendency of the case since 2003, petitioner only
invoked his right to speedy disposition of cases when the informations were filed on
November 17, 2011. Petitioner has not shown that he asserted his rights during this
period, choosing instead to wait until the information was filed against him with the
Sandiganbayan. Furthermore, the case before the Sandiganbayan involves the alleged
malversation of millions in public money. The Sandiganbayan has yet to determine the
guilt or innocence of petitioner. In the Decision dated June 17, 2010 of the
Sandiganbayan acquitting petitioner. The records of the case show that the transactions
investigated are complex and numerous. As respondent points out, there were over a
hundred individuals investigated, and eventually, 40 of them were determined to have
been involved in 81 different anomalous transactions

ISSUES:
1. WON respondent committed inordinate delay in the resolution and termination
of the preliminary investigation against petitioner
2. When is right to speedy disposition of cases or the right to speedy trial invoked.
RULING:
I. No. Even granting that the Commission on Audit's Audit Report
exhaustively investigated each transaction, "the prosecution is not bound by
the findings of the Commission on Audit; it must rely on its own independent
judgment in the determination of probable cause." Delays in the investigation
and review would have been inevitable in the hands of a competent and
independent Ombudsman. The dismissal of the complaints, while favorable
to petitioner, would undoubtedly be prejudicial to the State. "The State should
not be prejudiced and deprived of its right to prosecute the criminal cases
simply because of the ineptitude or nonchalance of the Office of the
Ombudsman." The State is as much entitled to due process as the accused.
This Court finds that there is no violation of the accused's right to speedy
disposition of cases considering that there was a waiver of the delay of a
complex case. Definitely, granting the present Petitions and finding grave
abuse of discretion on the part of the Sandiganbayan will only prejudice the
due process rights of the State

II. This Court now clarifies the mode of analysis in situations where the right to
speedy disposition of cases or the right to speedy trial is invoked.
First, the right to speedy disposition of cases is different from the right to speedy
trial. The right to speedy trial may only be invoked in criminal prosecutions against
courts of law. The right to speedy disposition of cases, however, may be invoked before
any tribunal, whether judicial or quasi-judicial.
Second, a case is deemed initiated upon the filing of a formal complaint prior to
a conduct of a preliminary investigation. This Court acknowledges, however, that the
Ombudsman should set reasonable periods for preliminary investigation, with due
regard to the complexities and nuances of each case. Delays beyond this period will be
taken against the prosecution. The period taken for fact-finding investigations prior to
the filing of the formal complaint shall not be included in the determination of whether
there has been inordinate delay.
Third, courts must first determine which party carries the burden of proof.
Fourth, determination of the length of delay is never mechanical. Courts must
consider the entire context of the case, from the amount of evidence to be weighed to
the simplicity or complexity of the issues raised.
Fifth, the right to speedy disposition of cases or the right to speedy trial must be
timely raised. The respondent or the accused must file the appropriate motion upon the
lapse of the statutory or procedural periods. Otherwise, they are deemed to have waived
their right to speedy disposition of cases.
Note: The period for the determination of whether inordinate delay was
committed shall commence from the filing of a formal complaint and the
conduct of the preliminary investigation. The periods for the resolution of the
preliminary investigation shall be that provided in the Rules of Court,
Supreme Court Circulars, and the periods to be established by the Office of the
Ombudsman. Failure of the defendant to file the appropriate motion
after the lapse of the statutory or procedural periods shall be considered a waiver
of his or her right to speedy disposition of cases.

JINGGOY ESTRADA vs. OMBUDSMAN ETC.

G.R NO. 212761 etc. July 31, 2018
FACTS:
Petitioners are charged as co-conspirators for their respective participation in the illegal
pillaging of public funds sourced from the Priority Development Assistance Fund
(PDAF) of Estrada for the years 2004 to 2012. The charges are contained in two (2)
complaints, namely: (1) a Complaint for Plunder filed by the National Bureau of
Investigation and Atty. Levito D. Baligod (NBI Complaint) on 16 September 2013, (2)
a Complaint for Plunder and violation of Section 3(e) of RA 30196 filed by the Field
Investigation Office of the Ombudsman (FIO Complaint) on 18 November 2013, both
before the Ombudsman.
Estrada submitted his separate Counter-Affidavits to the NBI Complaint on 8 January
2014, and to the FIO Complaint on 16 January 2014.
The motions for reconsideration were denied in the Joint Order issued by the
Ombudsman on 4 June 2014. Following the denial of the petitioners' motions for
reconsideration, the Ombudsman filed several information before the Sandiganbayan,
charging petitioners with one ( 1) count of Plunder and eleven ( 11) counts of violation
of Section 3(e) ofRA3019.
Thus, Estrada, De Asis, and Napoles filed their separate petitions for certiorari assailing
the Joint Resolution and Joint Order of the Ombudsman before this Court.
ISSUE:
1.. Whether or not the crime of plunder exists
2. Whether or not probable cause exists.

RULING:
I. Yes. Plunder, defined and penalized under Section 245 of RA 7080, as
amended, has the following elements: (a) that the offender is a public officer,
who acts by himself or in connivance with members of his family, relatives
by affinity or consanguinity, business associates, subordinates or other
persons; (b) that he amasses, accumulates or acquires ill-gotten wealth
through a combination or series of overt or criminal acts described in Section
1 ( d)46 hereof; and ( c) that the aggregate amount or total value of the ill-
gotten wealth amassed, accumulated, or acquired is at least Fifty Million Pesos
(PS0,000,000.00).
In its Joint Resolution48 dated 28 March 2014, the Ombudsman found that probable
cause exists to indict Estrada for plunder, after finding that the elements of the crime
charged are reasonably apparent based on the evidence on record:
First, it is undisputed that Senator Estrada was a public officer at the time
material to the charges.
Second, he amassed, accumulated or acquired ill-gotten wealth.
Third, the amounts earned by Senator Estrada through kickbacks and
commissions amounted to more than Fifty Million Pesos (P50,000,000.00).
II. Yes. A finding of probable cause needs only to rest on evidence showing that more
likely than not a crime has been committed and was committed by the suspects.
Probable cause need not be based on clear and convincing evidence of guilt, neither on
evidence establishing guilt beyond reasonable doubt and definitely, not on evidence
establishing absolute certainty of guilt. Probable cause merely implies probability of
guilt and should be determined in a summary manner. Preliminary investigation is not
a part of trial and it is only in a trial where an accused can demand the full exercise of
his rights, such as the right to confront and cross-examine his accusers to establish his
innocence. Xxx
The prevailing definition of probable cause is this: In dealing with probable
cause, however, as the very name implies, we deal with probabilities. These are not
technical; they are the factual and practical considerations of everyday life on which
reasonable and prudent men, not legal technicians, act. The standard of proof is
accordingly correlative to what must be proved.
In order to arrive at probable cause, the elements of the crime charged should
be present. In Reyes v. Ombudsman (Reyes}, this Court unanimously held that in
determining the elements of the crime charged for purposes of arriving at a finding of
probable cause, "only facts sufficient to support a prima facie case against the accused
are required, not absolute certainty
Owing to the nature of a preliminary investigation and its purpose, all of the
foregoing elements need not be definitively established for it is enough that their
presence becomes reasonably apparent. This is because probable cause - the
determinative matter in a preliminary investigation implies mere probability of guilt;
thus, a finding based on more than bare suspicion but less than evidence that would
justify a conviction would suffice. Also, it should be pointed out that a preliminary
investigation is not the occasion for the full and exhaustive display of the prosecution's
evidence, and that the presence or absence of the elements of the crime is evidentiary
in nature and is a matter of defense that may be passed upon after a full-blown trial on
the merits. Therefore, "the validity and merits of a party's defense or accusation, as well
as the admissibility of testimonies and evidence, are better ventilated during trial proper
than at the preliminary investigation level." Furthermore, owing to the initiatory nature
of preliminary investigations, the "technical rules of evidence should not be applied" in
the course of its proceedings, keeping in mind that "the determination of probable cause
does not depend on the validity or merits of a party's accusation or defense or on the
admissibility or veracity of testimonies presented."
Thus, in Estrada v. Ombudsman (Estrada), the Court declared that since a
preliminary investigation does not finally adjudicate the rights and obligations of parties,
"probable cause can be established with hearsay evidence, as long as there is substantial
basis for crediting the hearsay."
 3. BONG REVILLA vs. SANDIGAN
G.R. 218232 etc., July 24, 2018
En banc, J. Carpio
FACTS:
The cases stemmed from the Information dated 5 June 2014
filed by the Office of the Ombudsman in the Sandiganbayan charging
petitioners Revilla, Cambe, and Napoles, among others, with the crime of
Plunder.

In a Resolution11 dated 19 June 2014, the Sandiganbayan issued

warrants of arrest against Revilla, Cambe, and Napoles. On the same day,
Revilla voluntarily surrendered to the Philippine National Police (PNP) and
filed a Motion to Elect Detention Facilities Ad Cautelam 12 praying for his
detention at the PNP Custodial Center in Camp Crame. On 20 June 2014,
Cambe also voluntarily surrendered to the Sandiganbayan and filed an
Urgent Motion to Commit Accused to Criminal Investigation and Detection
Group (CIDG)13 pending trial of the case.

In two separate Resolutions14 both dated 20 June 2014, the

Sandiganbayan ordered the tum over of Revilla and Cambe to the PNPCIDG,
Camp Crame, Quezon City for detention at its PNP Custodial Center Barracks.

Revilla filed a Petition for Bail Ad Cautelam dated 20 June 2014;

Cambe filed an Application for Bail15 dated 23 June 2014; and Napoles filed a Joint
Petition for Bail dated 25 June 2014, together with co-accused Ronald John Lim
(Lim) and John Raymund De Asis (De Asis). 16Thereafter, the Sandiganbayan
conducted the bail hearings for Revilla, Cambe, and Napoles.

In a Resolution dated 1 December 2014, 18 the Sandiganbayan denied

the separate applications for bail filed by Revilla, Cambe, and Napoles.

Thus, Revilla, Cambe, and Napoles filed their separate petitions for
certiorari assailing the Resolutions of the Sandiganbayan before this Court.

On 21 December 2016, Revilla filed a Motion to Withdraw20 the

Petition for Certiorari he filed before this Court alleging that "considering,
however, that the presentation of prosecution evidence in the Plunder Case
below will already commence on 12 January 2017, and that trial will be
conducted every Thursday thereafter, petitioner will avail of the remedies
available to him in said proceedings once the insufficiency of the evidence against
him is established. "

ISSUE:
1. Whether or not application for admission to bail may be granted.

2.Whether or not the Sandiganbayan committed grave abuse of discretion.

RULING:
No. At the outset, we note that Revilla withdrew his petition before the
Court assailing the Resolution of the Sandiganbayan denying him bail. In
withdrawing his petition, he stated "He will avail of the remedies available
to him in the plunder case before the Sandiganbayan once the insufficiency
of the evidence against him is established."Accordingly, we no longer
find it necessary to rule upon the issues raised by Revilla in his petition.

Judicial discretion, by its very nature, involves the exercise of the

judge's individual opinion and the law has wisely provided that its exercise
be guided by well-known rules which, while allowing the judge rational
latitude for the operation of his own individual views, prevent them from
getting out of control. We have held that discretion is guided by: first, the
applicable provisions of the Constitution and the statutes; second, by the
rules which this Court may promulgate; and third, by those principles of
equity and justice that are deemed to be part of the laws of the land.45 The
discretion of the court, once exercised, cannot be reviewed by certiorari nor
controlled by mandamus save in instances where such discretion has been so
exercised in an arbitrary or capricious manner. 46
42

Section 13, Article III of the 1987 Constitution provides that: All persons, except
those charged with offenses punishable by
reclusion perpetua when evidence of guilt is strong, shall, before
conviction, be bailable by sufficient sureties, or be released on
recognizance as may be provided by law. The right to bail shall not be impaired even when the
privilege of the writ of habeas corpus is
suspended. Excessive bail shall not be required.
Rule 114 of the Rules of Court emphasizes that offenses punishable
by death, reclusion perpetua or life imprisonment are non-bailable when the
evidence of guilt is strong:
Sec. 7. Capital offense or an offense punishable by reclusion perpetua or
life imprisonment, not bailable. - No person charged with a capital
offense, or an offense punishable by reclusion perpetua or life
imprisonment, shall be admitted to bail when evidence of guilt is strong,
regardless of the stage of the criminal prosecution.

The grant or denial of bail in an offense punishable by reclusion

perpetua, such as plunder, hinges on the issue of whether or not the
evidence of guilt of the accused is strong. This requires the conduct of bail
hearings where the prosecution has the burden of showing that the evidence
of guilt is strong, subject to the right of the defense to cross-examine witnesses and
introduce evidence in its own rebuttal. The court is to conduct only a summary
hearing, or such brief and speedy method of receiving and considering the evidence of
guilt as is practicable and consistent with the purpose of the hearing which is merely
to determine the
weight of evidence for purposes of bail. The order granting or refusing bail which
shall thereafter be issued must contain a summary of the evidence for the prosecution.
50 The summary of the evidence shows that the evidence presented during the prior

hearing is formally recognized as having been presented and most importantly,

considered.51 The summary of the evidence is the basis for the judge's exercising his
judicial discretion. Only after weighing the pieces of
evidence as contained in the summary will the judge formulate his own
conclusion as to whether the evidence of guilt against the accused is strong
based on his discretion. 53 Thus, judicial discretion is not unbridled but must
be supported by a finding of the facts relied upon to form an opinion on the
issue before the court. 54 It must be exercised regularly, legally and within the confines
of procedural due process, that is, after evaluation of the evidence
submitted by the prosecution. 55 Any order issued in the absence thereof is
not a product of sound judicial discretion but of whim, caprice, and outright
arbitrariness. 56In the present case, we find that the Sandiganbayan did not abuse its
discretion amounting to lack or excess of jurisdiction when it denied bail to Cambe
and Napoles, upon a finding of strong evidence that they committed the crime of
plunder in conspiracy with one another.

AGCAOILI JR. Et al vs. Rep. Rodulfo farinas - ilocos 6

FACTS:
On March 14, 201 7, House Resolution No. 882 was introduced by
respondent Farinas, along with Representatives Pablo P. Bondoc and
Aurelio D. Gonzales, Jr., directing House Committee to conduct an inquiry,
in aid of legislation, pertaining to the use by the Provincial Government of
Ilocos Norte of its shares from the excise taxes on locally manufactured
virginia-type cigarettes for a purpose other than that provided for by
R.A.No. 7171.6 The "whereas clause" of House Resolution
No. 882 states that the following purchases by the Provincial Government of
Ilocos Norte of vehicles in three separate transactions from the years 2011 to
2012 in the aggregate amount of P66,450,000.00 were in violation of R.A.
No. 7171 as well as of R.A. No. 91847 (P.D.) No. 1445:

Invitation Letters 10 dated April 6, 201 7 were individually sent to petitioners for
them to attend as resource persons the initial hearing on House Resolution No. 882
scheduled on May 2, 2017. In response, petitioners sent similarly worded Letters11
dated April 21, 2017 asking to be excused from the inquiry pending official
instructions from co-petitioner Marcos as head of the agency.

On one hand, petitioners allege that at the hearing of May 29, 2017,
they were subjected to threats and intimidation.21 According to petitioners,
they were asked "leading and misleading questions" and that regardless of
their answers, the same were similarly treated as evasive.

On the other hand, respondents aver that petitioners were evasive in

answering questions and simply claimed not to remember the specifics of
the subject transactions. According to respondents, petitioners requested to
be confronted with the original documents to refresh their memories when they knew
beforehand that the Commission on Audit (COA) to which the
original vouchers were submitted could no longer find the same.29

On May 30, 2017, petitioners filed a Petition for

Habeas Corpus against respondent House Sergeant-at-Arms Lieutenant
General Detabali (Detabali) before the CA.

On June 6, 2017, petitioners filed a Motion for Provisional Release

based on petitioners' constitutional right to bail. Detabali, through the OSG,
opposed the motion.34

Petitioners contend that their rights to liberty and personal security

were violated as they have been detained, while co-petitioner Marcos is
continuously being threatened of arrest. In opposition, respondents maintain that the
writ of Amparo and writ of Habeas Corpus are two separate remedies which are
incompatible and therefore cannot co-exist in a single petition. Further, respondents
argue that the issuance of a writ of Amparo is limited only to cases of extrajudicial
killings and enforced disappearances which are not extant in the instant case.
ISSUE:
1. Whether or not Writ of Amparo may be granted on the ground that
right to liberty and security are being threatened by the conduct of the legislative
inquiry on House Resolution No. 882.
2. What are the limitations on Congress' Power to Cite in Contempt?

RULING:
I. No. The writ of Amparo is designed to protect and guarantee the (1) right to life; (2)
right to liberty; and (3) right to security of persons, free from fears and threats that
vitiate the quality of life.

Consequently, every petition for the issuance of a writ of Amparo should be supported
by justifying allegations of fact, which the Court in Tapuz laid down as follows:(a)
The personal circumstances of the petitioner;

In this case, the alleged unlawful restraint on petitioners' liberty has

effectively ceased upon their subsequent release from detention. On the
other hand, the apprehension of co-petitioner Marcos that she will be
detained is, at best, merely speculative. In other words, co-petitioner Marcos
has failed to show any clear threat to her right to liberty actionable through a
petition for a writ of Amparo.
Here, it appears that petitioners and co-petitioner Marcos even attended and
participated in the subsequent hearings on House Resolution No. 882 without any
untoward incident. Petitioners and co-petitioner

Marcos thus failed to establish that their attendance at and participation in the legislative
inquiry as resource persons have seriously violated their right to liberty and security, for
which no other legal recourse or remedy is available. Perforce, the petition for the
issuance of a writ of Amparo must be dismissed.

II.The letter of the CA Justices to the Court En Banc

betrays the struggle these CA Justices encountered in view of the
Congressional power to cite in contempt and consequently, to arrest and
detain. These Congressional powers are indeed awesome. Yet, such could
not be used to deprive the Court of its Constitutional duty to supervise judges of
lower courts in the performance of their official duties. The fact remains that the CA
Justices are non-impeachable officers. As such, authority over them primarily belongs
to this Court and to no other.

To echo the Court's ruling in Maceda v. Ombudsman Vasquez: 134

The Supreme Court has administrative supervision over all courts and
court personnel, from the Presiding Justice of the Court of Appeals down
to the lowest municipal trial court clerk. By virtue of this power, it is only
the Supreme Court that can oversee the judges' and court personnel's
compliance with all laws, and take the proper administrative action against
them if they commit any violation thereof. No other branch of government
may intrude into this power, without running afoul of the doctrine of
separation of powers.

It is this very principle of the doctrine of separation of powers as

enshrined under the Constitution that urges the Court to carefully tread on
areas falling under the sole discretion of the legislative branch of the
government. In point is the power of legislative investigation which the Congress
exercises as a Constitutional prerogative.

The invocation of the Court's judicial privilege is understood to

be limited to matters that are part of the internal deliberations and actions of
the Court in the exercise of the Members' adjudicatory functions and duties
As a guiding principle, the purpose of judicial privilege, as a child of
judicial power, is principally for the effective discharge of such judicial
power. If the matter upon which Members of the Court, court officials and
employees privy to the Court's deliberations, are called to appear and testify
do not relate to and will not impair the Court's deliberative adjudicatory
judicial power, then judicial privilege may not be successfully invoked.

The Court had occasion to illustrate the application of the rule on judicial privilege
and its qualifications to impeachment proceedings as
follows: Where the ground cited in an impeachment complaint is bribery, a
Justice may be called as a witness in the impeachment of another Justice, as bribery is
a matter external to or is not connected with the adjudicatory
functions and duties of a magistrate. A Justice, however, may not be called to testify
on the arguments, the accused Justice presented in the internal debates as these
constitute details of the deliberative process. 139

Mandanas, et.al vs. Ochoa, et.al, Garcia vs. Ochoa, et. al

G.R. No. 199802, 208488

FACTS:
Mandanas, et al. allege herein that certain collections of NIR Ts by the Bureau of
Customs (BOC) - specifically: excise taxes, value added taxes (VATs) and documentary
stamp taxes (DSTs) - have not been included in the base amounts for the computation
of the IRA; that such taxes, albeit collected by the BOC, should form part of the base
from which the IRA should be computed because they constituted NIRTs; that,
consequently, the release of the additional amount of P60,750,000,000.00 to the LGUs
as their IRA for FY 2012 should be ordered; and that for the same reason the LGUs
should also be released their unpaid IRA for FY 1992 to FY 2011, inclusive, totaling
P438,103,906,675.73.
In G.R. No. 208488, Congressman Enrique Garcia, Jr., the lone petitioner, seeks the
writ of mandamus to compel the respondents thereat to compute the just share of the
LGUs on the basis of all national taxes. His petition insists on a literal reading of Section
6, Article X of the 1987 Constitution. He avers that the insertion by Congress of the
words internal revenue in the phrase national taxes found in Section 284 of the LGC
caused the diminution of the base for determining the just share of the LGUs, and
should be declared unconstitutional; that, moreover, the exclusion of certain taxes and
accounts pursuant to or in accordance with special laws was similarly constitutionally
untenable; that the VA Ts and excise taxes collected by the BOC should be included in
the computation of the IRA; and that the respondents should compute the IRA on the
basis of all national tax collections, and thereafter distribute any shortfall to the LGUs.
The cases were consolidated on October 22, 2013. 3 In the meanwhile, Congressman
Garcia, Jr. passed away. Jose Enrique Garcia III, who was subsequently elected to the
same congressional post, was substituted for Congressman Garcia, Jr. as the petitioner
in G.R. No. 208488 under the resolution promulgated on August 23, 2016. In response
to the petitions, the several respondents, represented by the Office of the Solicitor
General (OSG), urged the dismissal of the petitions upon procedural and substantive
considerations
ISSUE:
1. What is the relationship of LGU’s with National Government?
2. What constitutes “Just Share” in national taxes?
3. What is decentralization and its categories?
RULING:
I. Municipal corporations are now commonly known as local governments. They are
the bodies politic established by law partly as agencies of the State to assist in the civil
governance of the country. Their chief purpose has been to regulate and administer the
local and internal affairs of the cities, municipalities or districts. They are legal
institutions formed by charters from the sovereign power, whereby the populations
within communities living within prescribed areas have formed themselves into bodies
politic and corporate, and assumed their corporate names with the right of continuous
succession and for the purposes and with the authority of subordinate self-government
and improvement and the local administration of the affairs of the State. Municipal
corporations, being the mere creatures of the State, are subject to the will of Congress,
their creator. Their continued existence and the grant of their powers are dependent on
the discretion of Congress.
Municipal governments are only agents of the national government. Local councils
exercise only delegated legislative powers conferred on them by Congress as the
national lawmaking body. The delegate cannot be superior to the principal or exercise
powers higher than those of the latter. It is a heresy to suggest that the local government
units can undo the acts of Congress, from which they have derived their power in the
first place, and negate by mere ordinance the mandate of the statute. Municipal
corporations owe their origin to, and derive their powers and rights wholly from the
legislature. It breathes into them the breath of life; without which they cannot exist. As
it creates, so it may destroy. As it may destroy, it may abridge and control. Unless there
is some constitutional limitation on the right, the legislature might, by a single act, and
if we can suppose it capable of so great a folly and so great a wrong, sweep from
existence all of the municipal corporations in the State, and the corporation could not
prevent it. We know of no limitation on the right so far as to the corporation themselves
are concerned. They are, so to phrase it, the mere tenants at will of the legislature. This
basic relationship between the national legislature and the local government units has
not been enfeebled by the new provisions in the Constitution strengthening the policy
of local autonomy. Without meaning to detract from that policy, we here confirm that
Congress retains control of the local government units although in significantly reduced
degree now than under our previous Constitutions. The power to create still includes
the power to destroy. The power to grant still includes the power to withhold or recall.
True, there are certain notable innovations in the Constitution, like the direct
conferment on the local government units of the power to tax, which cannot now be
withdrawn by mere statute. By and large, however, the national legislature is still the
principal of the local government units, which cannot defy its will or modify or violate
it.
II. Section 6, Article X the 1987 Constitution textually commands the allocation to the
LGUs of a just share in the national taxes. Local government units shall have a just
share, as determined by law, in the national taxes which shall be automatically released
to them. Section 6, when parsed, embodies three mandates, namely: ( 1) the LGUs shall
have a just share in the national taxes; (2) the just share shall be determined by law; and
(3) the just share shall be automatically released to the LGUs.
What the phrase national internal revenue taxes as used in Section 284 included are all
the taxes enumerated in Section 21 of the National Internal Revenue Code (NIRC), as
amended by R.A. No. 8424, viz.: Section 21. Sources of Revenue. - The following taxes,
fees and charges are deemed to be national internal revenue taxes: (a) Income tax; (b)
Estate and donor's taxes; (c) Value-added tax; ( d) Other percentage taxes; (e) Excise
taxes; (f) Documentary stan1p taxes; and (g) Such other taxes as arc or hereafter may
be imposed and collected by the Bureau of Internal Revenue.
In view of the foregoing enumeration of what are the national internal revenue taxes,
Section 284 has effectively deprived the LGUs from deriving their just share from other
national taxes, like the customs duties. Strictly speaking, customs duties are also taxes
because they are exactions whose proceeds become public funds. According to Garcia
v. Executive Secretary,53 customs duties is the nomenclature given to taxes imposed
on the importation and exportation of commodities and merchandise to or from a
foreign country.
We further note that Section 102(00) of R.A. No. 10863 (Customs Modernization and
Tariff Act) expressly includes all fees and charges imposed under the Act under the
blanket term of taxes. It is clear from the foregoing clarification that the exclusion of
other national taxes like customs duties from the base for determining the just share of
the LG Us contravened the express constitutional edict in Section 6, Article X the 1987
Constitution.
III..
The constitutional mandate to ensure local autonomy refers to decentralization. In its
broad or general sense, decentralization has two forms in the Philippine setting, namely:
the decentralization of power and the decentralization of administration. The
decentralization of power involves the abdication of political power in favor of the
autonomous LGUs as to grant them the freedom to chart their own destinies and to
shape their futures with minimum intervention from the central government. On the
other hand, the decentralization of administration occurs when the central government
delegates administrative powers to the LGUs as the means of broadening the base of
governmental powers and of making the LGUs more responsive and accountable in
the process, and thereby ensure their fullest development as self-reliant communities
and more effective partners in the pursuit of the goals of national development and
social progress.
Two groups of LGUs enjoy decentralization in distinct ways. The decentralization of
power has been given to the regional units (namely, the Autonomous Region for
Muslim Mindanao [ ARMM] and the constitutionally-mandated Cordillera
Autonomous Region [CAR]). The other group of LGUs (i.e., provinces, cities,
municipalities and barangays) enjoy the decentralization of administration.
As a system of transferring authority and power from the National Government to the
LGUs, decentralization in the Philippines may be categorized into four, namely: ( 1)
political decentralization or devolution; (2) administrative decentralization or
deconcentration; (3) fiscal decentralization; and ( 4) policy or decision-making
decentralization.
Political decentralization or devolution occurs when there is a transfer of powers,
responsibilities, and resources from the central government to the LOU s for the
performance of certain functions. It is a more liberal form of decentralization because
there is an actual transfer of powers and responsibilities. It aims to grant greater
autonomy to the LGUs in cognizance of their right to self-government, to make them
self-reliant, and to improve their administrative and technical capabilities.
Administrative decentralization or involves the transfer of functions or the delegation
of authority and responsibility from the national office to the regional and local offices.
.
Fiscal decentralization means that the LGUs have the power to create their own sources
of revenue in addition to their just share in the national taxes released by the National
Government. It includes the power to allocate their resources in accordance with their
own priorities. It thus extends to the preparation of their budgets, so that the local
officials have to work within the constraints of their budgets.
In fine, certain limitations are and can be imposed by Congress in all the forms of
decentralization, for local autonomy, whether as to power or as to administration, is not
absolute. The LGUs remain to be the tenants of the will of Congress subject to the
guarantees that the Constitution itself imposes.