SCA_ Metropolitan Bank vs NWPC and RTWPB

7/24/2019 SCA_ Metropolitan Bank vs NWPC and RTWPB.

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G.R. NO. 144322 February 6, 2007

METROPOLITAN BANK an TR!"T #OMPAN$, IN#., Petitioner,

vs.

NATIONAL %AGE" AN& PRO&!#TI'IT$ #OMMI""ION an REGIONAL TRIPARTITE %AGE"

AN& PRO&!#TI'IT$ BOAR& ( REGION II,Respondents.

Facts:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court

seeking the reversal of the Decision1of the Court of Appeals CA! dated "ul# 1$, %&&& in CA'(.R.

)P *o. 4%%4& which denied the petition for certiorari and prohi+ition of etropolitan Bank and -rust

Copan#, /nc. petitioner!.

-he procedural antecedents and factual +ackground of the case are as follows0

n cto+er 12, 1$$5, the Regional -ripartite 3ages and Productivit# Board, Region //, -uguegarao,

Caga#an R-3PB!, +# virtue of Repu+lic Act *o. 2%2 R.A. *o. 2%2!, otherwise known as the

3age Rationaliation Act,%issued 3age rder *o. R&%'&6 3age rder,

)ection 1. 7pon effectivit# of this 3age rder, all eplo#ees8workers in the private sector

throughout Region //, regardless of the status of eplo#ent are granted an across'the'+oard

increase of P15.&& dail#.

/n a letter'in9uir# to the *3PC dated a# 2, 1$$, the Bankers: Council for Personnel anageent

BCP!, on +ehalf of its e+er'+anks, re9uested for a ruling on the eligi+ilit# of esta+lishents

with head offices outside Region // to seek e;eption fro the coverage of the 3age rder since its

e+er'+anks are alread# pa#ing ore than the prevailing iniu wage rate in the *ational

Capital Region *CR!, which is their principal place of +usiness

/n a letter'repl# dated "ul# 1, 1$$, the *3PC stated that the e+er'+anks of BCP are covered+# the 3age rder and do not fall under the e;epti+le categories listed under the 3age rder.

/n a letter'in9uir# to the *3PC dated "ul# %6, 1$$, petitioner sought for interpretation of the

applica+ilit# of said 3age rder.1&-he *3PC referred petitioner:s in9uir# to the R-3PB.

the R-3PB clarified that the 3age rder covers all private esta+lishents situated in Region //,

regardless of the voluntar# adoption +# said esta+lishents of the wage orders esta+lished in etro

anila and irrespective of the aounts alread# paid +# the petitioner.11

n cto+er 15, 1$$, )*e +e))-ner /e a Pe))-n -r Certiorarian Pr-*b)-n )* )*e #A

seeking nullification of the 3age rder on grounds that the R-3PB acted without authorit# when it

issued the 9uestioned 3age rde.

n arch %4, 1$$2, the ffice of the )olicitor (eneral )(! filed a anifestation and otion in lieu

of Coent affiring the petitioner:s clai that the R-3PB acted +e#ond its authorit# in issuing the

3age rder prescri+ing an across'the'+oard increase to all workers and eplo#ees in Region //,

effectivel# granting additional or other +enefits not conteplated +# R.A. *o. 2%2

n )epte+er %%, 1$$2, respondents filed their Coent pra#ing that the petition should +e

disissed outright for petitioner:s procedural lapses< )*a) er)-rar an +r-*b)-n are unaa/n

ne +e))-ner a/e )- aa/ - )*e re5ey - a++ea/ +rerbe by )*e %ae Orer< that the
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3age rder has long +een in effect< and )*a) )*e uane - )*e %ae Orer a +er-r5e n

)*e eere - a +ure/y a5n)ra)e un)-n.

CA ruling0

the CA rendered its Decision den#ing the petition. T*e a++e//a)e -ur) *e/ )*a) a r) -

+r-*b)-n an n- /-ner be ue ne 5+/e5en)a)-n - )*e %ae Orer *a /-n

be-5e fait accompli,the 3age rder having taken effect on "anuar# 1, 1$$ and its

ipleenting rules approved on =e+ruar# 14, 1$$ )*a) a r) - er)-rar 5+r-+er ne )*e

%ae Orer a ue n )*e eere - a +ure/y a5n)ra)e un)-n, n-) 8ua/ -r

9ua(8ua/< that the letter'9uer# did not present >usticia+le controversies ripe for consideration +#

the respondents in the e;ercise of their wage'fi;ing function, since no appeal fro the 3age rder

was filed.

/ssues0

1! 3hether 3age rder *o. R&%'&6 is void and of no legal effect< and

%! whether petitioner:s recourse to a petition for certiorari and prohi+ition with the CA was proper.

ao ra ni an sa )CA!

Ruling0

%. *o.

Certiorarias a special civil action is availa+le onl# if the following essential re9uisites concur0 1! it

ust +e directed against a tri+unal, +oard, or officer e;ercising >udicial or 9uasi'>udicial functions< %!

the tri+unal, +oard, or officer ust have acted without or in e;cess of >urisdiction or with grave a+use

of discretion aounting lack or e;cess of >urisdiction< and 6! there is no appeal nor an# plain,

speed#, and ade9uate reed# in the ordinar# course of law.%4

n the other hand, +r-*b)-nas a special civil action is availa+le onl# if the following essential

re9uisites concur0 1! it ust +e directed against a tri+unal, corporation, +oard, officer, or person

e;ercising functions, >udicial, 9uasi'>udicial, or inisterial< %! the tri+unal, corporation, +oard or

person has acted without or in e;cess of its >urisdiction, or with grave a+use of discretion aounting

lack or e;cess of >urisdiction< and 6! there is no appeal or an# other plain, speed#, and ade9uate

reed# in the ordinar# course of law

A respondent is said to +e eern 8ua/ un)-nwhere he has the power to deterine what

the law is and what the legal rights of the parties are, and then undertakes to deterine these

9uestions and ad>udicate upon the rights of the parties.%:ua(8ua/ un)-nis a ter which

applies to the action, discretion, etc., of pu+lic adinistrative officers or +odies, who are re9uired to

investigate facts or ascertain the e;istence of facts, hold hearings, and draw conclusions fro the

as a +asis for their official action and to e;ercise discretion of a >udicial nature.%2Mn)era/ un)-n

is one which an officer or tri+unal perfors in the conte;t of a given set of facts, in a prescri+ed

anner and without regard to the e;ercise of his own >udgent upon the propriet# or ipropriet# of

the act done.

In )*e uane - )*e aa/e %ae Orer, re+-nen) RT%PB n-) a) n any 8ua/,

9ua(8ua/ a+a)y, -r 5n)era/ a+a)y. /t was in the nature of su+ordinate legislation,

proulgated +# it in the e;ercise of delegated power under R.A. *o. 2%2. I) a ue n )*e
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eere - 9ua(/e/a)e +-er.?uasi'legislative or rule'aking power is e;ercised +#

adinistrative agencies through the proulgation of rules and regulations within the confines of the

granting statute and the doctrine of non'delegation of certain powers flowing fro the separation of

the great +ranches of the governent.%$

oreover, )*e ru/e -n )*e +ea/ / a)-n - er)-rar an +r-*b)-n e9ua//y 5ana)e

)*a) )*ee e)ra(-rnary re5ee are aa/ab/e -n/y *en ;)*ere n- a++ea/ -r any -)*er

+/an, +eey, an ae9ua)e re5ey n )*e -rnary -ure - /a.@ A reed# is considered

plain, speed# and ade9uate if it will proptl# relieve the petitioner fro the in>urious effects of the

>udgent or rule, order or resolution of the lower court or agenc#.

)ection 16 of the assailed 3age rder e;plicitl# provides that an# part# aggrieved +# the 3age

rder a# file an appeal with the *3PC through the R-3PB within 1& da#s fro the pu+lication of

the wage order.

/n this case, petitioner did not avail of the reed# provided +# law. *o appeal to the *3PC was filed

+# the petitioner within 1& calendar da#s fro pu+lication of the 3age rder on Dece+er %, 1$$5.

Petitioner was silent until seven onths later, when it filed a letter'in9uir# on "ul# %4, 1$$ with the

*3PC seeking a clarification on the application of the 3age rder. videntl#, )*e /e))er(n9ury n-) an a++ea/.

/t ust also +e noted that the *3PC onl# referred petitioner:s letter'in9uir# to the R-3PB. Petitioner

did not appeal the letter'repl# dated August 1%, 1$$ of the R-3PB to the *3PC. *o direct action

was taken +# the *3PC on the issuance or ipleentation of the 3age rder. Petitioner failed to

invoke the power of the *3PC to review regional wage levels set +# the R-3PB to deterine if

these are in accordance with prescri+ed guidelines. -hus, n-) -n/y a ) 5+r-+er )- 5+/ea )*e

N%P# a +ar)y(re+-nen) n )*e +e))-n be-re )*e #A an )* #-ur), bu) a/- +e))-ner

a/e )- aa/ - )*e +r5ary 8ur)-n - )*e N%P# uner Ar)/e 121 - )*e Lab-r #-e

7nder the -)rne - +r5ary 8ur)-n, courts cannot and will not resolve a controvers#

involving a 9uestion which is within the >urisdiction of an adinistrative tri+unal, especiall# where the

9uestion deands the e;ercise of sound adinistrative discretion re9uiring the special knowledge,

e;perience and services of the adinistrative tri+unal to deterine technical and intricate atters of

fact.

Sa issue sa validity sa wage order

)*e #-ur) n )*a) "e)-n 1, %ae Orer N-. R02(03 - n-ar a ) ran) a ae

nreae )- e5+/-yee earnn 5-re )*an )*e 5n5u5 ae ra)e< and pursuant to the

separa+ilit# clause56of the 3age rder, )ection 1 is declared valid with respect to eplo#ees

earning the prevailing iniu wage rate. Belllaaaaaarssssss ahaha..
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1awphi1.netG.R. NO. 144322 February 6, 2007

METROPOLITAN BANK an TR!"T #OMPAN$, IN#., Petitioner,

vs.

NATIONAL %AGE" AN& PRO&!#TI'IT$ #OMMI""ION an REGIONAL TRIPARTITE %AGE"

AN& PRO&!#TI'IT$ BOAR& ( REGION II,Respondents.

& E # I " I O N

A!"TRIA(MARTINE


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n cto+er 15, 1$$, the petitioner filed a Petition for Certiorariand Prohi+ition with the CA seeking

nullification of the 3age rder on grounds that the R-3PB acted without authorit# when it issued

the 9uestioned 3age rder< that even assuing that the R-3PB was vested with the authorit# to

prescri+e an increase, it e;ceeded its authorit# when it did so without an# ceiling or 9ualification< that

the ipleentation of the 3age rder will cause the petitioner, and other siilarl# situated

eplo#ers, to incur huge financial losses and suffer la+or unrest.1%

n arch %4, 1$$2, the ffice of the )olicitor (eneral )(! filed a anifestation and otion in lieu

of Coent affiring the petitioner:s clai that the R-3PB acted +e#ond its authorit# in issuing the

3age rder prescri+ing an across'the'+oard increase to all workers and eplo#ees in Region //,

effectivel# granting additional or other +enefits not conteplated +# R.A. *o. 2%2. 16

/n view of the )(:s anifestation, the CA directed respondents *3PC and R-3PB to file their

coent.14

n )epte+er %%, 1$$2, respondents filed their Coent pra#ing that the petition should +e

disissed outright for petitioner:s procedural lapses< that certiorari and prohi+ition are unavailing

since petitioner failed to avail of the reed# of appeal prescri+ed +# the 3age rder< that the 3agerder has long +een in effect< and that the issuance of the 3age rder was perfored in the

e;ercise of a purel# adinistrative function.15

n "ul# 1$, %&&&, the CA rendered its Decision den#ing the petition. -he appellate court held that a

writ of prohi+ition can no longer +e issued since ipleentation of the 3age rder had long

+ecoe fait accompli,the 3age rder having taken effect on "anuar# 1, 1$$ and its ipleenting

rules approved on =e+ruar# 14, 1$$< that a writ of certiorari is iproper since the 3age rder was

issued in the e;ercise of a purel# adinistrative function, not >udicial or 9uasi'>udicial< that the letter'

9uer# did not present >usticia+le controversies ripe for consideration +# the respondents in the

e;ercise of their wage'fi;ing function, since no appeal fro the 3age rder was filed< that petitioner

never +rought +efore the said +odies an# foral and definite challenge to the 3age rder and it

cannot pass off the letter'9ueries as actual applications for relief< that even if petitioner:s procedurallapse is disregarded, a regional wage order prescri+ing a wage increase across'the'+oard applies to

+anks adopting a unified wage s#ste and a disparit# in wages +etween eplo#ees holding siilar

positions in different regions is not wage distortion.1

ence, the present petition anchored on the following grounds0

4.1 - C7R- = APPAE) RRD /* R=7)/*( - DCEAR 3A( RDR *.

R&%'&6 *7EE A*D F/D A*D = * E(AE ==C-.

4.1.1 - BARD, /* /))7/*( 3A( RDR *. R&%'&6, GCDD -

A7-R/-H DE(A-D - /- BH C*(R)).

4.1.% 3A( RDR *. R&%'&6 /) A* 7*RA)*ABE /*-R7)/* /*- -

PRPR-H R/(-) = P-/-/*R.

4.1.6 3A( RDR *. R&%'&6 7*DR/*) - FRH ))*C =

CEEC-/F BAR(A/*/*(.
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4.1.4 3A( RDR *. R&%'&6 =A/E) - -AI /*- ACC7*- - FRH

RA-/*AE =R A 7*/=/D 3A( )-R7C-7R.

4.% P-/-/*R:) RC7R) - A 3R/- = CR-/RAR/ A*D PR/B/-/* 3A)

PRPR.12

=ollowing the su+ission of the Coent1and Repl#1$thereto, the Court gave due course to the

petition and re9uired +oth parties to su+it their respective eoranda.%&/n copliance therewith,

petitioner and respondents su+itted their respective eoranda.%1

Petitioner poses two issues for resolution, to wit0 1! whether 3age rder *o. R&%'&6 is void and of

no legal effect< and %! whether petitioner:s recourse to a petition for certiorari and prohi+ition with

the CA was proper.

Anent the first issue, petitioner aintains that the R-3PB, in issuing said 3age rder, e;ceeded the

authorit# delegated to it under R.A. *o. 2%2, which is liited to deterining and fi;ing the iniu

wage rate within their respective territorial >urisdiction and with respect onl# to eplo#ees who do not

earn the prescri+ed iniu wage rate< that the R-3PB is not authoried to grant a generalacross'the'+oard wage increase for non'iniu wage earners< that Employers Confederation of

the Philippines v. National Wages and Productivity Commission%%hereafter referred to as @CP@! is

not authorit# to rule that respondents have +een epowered to fi; wages other than the iniu

wage since said case dealt with an across'the'+oard increase with a salar# ceiling, where the wage

ad>ustent is applied to eplo#ees receiving a certain denoinated salar# ceiling< that the 3age

rder is an unreasona+le intrusion into its propert# rights< that the 3age rder underines the

essence of collective +argaining< that the 3age rder fails to take into account the rationale for a

unified wage structure.

As to the second issue, petitioner su+its that ultra viresacts of adinistrative agencies are

correcti+le +# wa# of a writ of certiorariand prohi+ition< that even assuing that it did not o+serve

the proper reedial procedure in challenging the 3age rder, the reed# of certiorariandprohi+ition reains availa+le to it +# wa# of an e;ception, on grounds of >ustice and e9uit#< that its

failure to o+serve procedural rules could not have validated the anner +# which the disputed 3age

rder was issued.

Respondents counter that the present petition is fatall# defective fro inception since no appeal fro

the 3age rder was filed +# petitioner< that the letter'9uer# to the *3PC did not constitute the

appeal conteplated +# law< that the validit# of the 3age rder was never raised +efore the

respondents< that the ipleentation of the 3age rder had long +ecoe fait accopli for

prohi+ition to prosper. Respondents insist that, even if petitioner:s procedural lapses are

disregarded, the 3age rder was issued pursuant to the andate of R.A. *o. 2%2 and in

accordance with the Court:s pronounceents in the CP caseudicial or 9uasi'>udicial functions< %!

the tri+unal, +oard, or officer ust have acted without or in e;cess of >urisdiction or with grave a+use

of discretion aounting lack or e;cess of >urisdiction< and 6! there is no appeal nor an# plain,

speed#, and ade9uate reed# in the ordinar# course of law.%4

n the other hand, prohi+ition as a special civil action is availa+le onl# if the following essential

re9uisites concur0 1! it ust +e directed against a tri+unal, corporation, +oard, officer, or person

e;ercising functions, >udicial, 9uasi'>udicial, or inisterial< %! the tri+unal, corporation, +oard or

person has acted without or in e;cess of its >urisdiction, or with grave a+use of discretion aounting

lack or e;cess of >urisdiction< and 6! there is no appeal or an# other plain, speed#, and ade9uate

reed# in the ordinar# course of law.%5

A respondent is said to +e e;ercising >udicial function where he has the power to deterine what the

law is and what the legal rights of the parties are, and then undertakes to deterine these 9uestions

and ad>udicate upon the rights of the parties.%?uasi'>udicial function is a ter which applies to the

action, discretion, etc., of pu+lic adinistrative officers or +odies, who are re9uired to investigate

facts or ascertain the e;istence of facts, hold hearings, and draw conclusions fro the as a +asisfor their official action and to e;ercise discretion of a >udicial nature.%2inisterial function is one

which an officer or tri+unal perfors in the conte;t of a given set of facts, in a prescri+ed anner and

without regard to the e;ercise of his own >udgent upon the propriet# or ipropriet# of the act

done.%

In )*e uane - )*e aa/e %ae Orer, re+-nen) RT%PB n-) a) n any 8ua/,

9ua(8ua/ a+a)y, -r 5n)era/ a+a)y. /t was in the nature of su+ordinate legislation,

proulgated +# it in the e;ercise of delegated power under R.A. *o. 2%2. /t was issued in the

e;ercise of 9uasi'legislative power. ?uasi'legislative or rule'aking power is e;ercised +#

adinistrative agencies through the proulgation of rules and regulations within the confines of the

granting statute and the doctrine of non'delegation of certain powers flowing fro the separation of

the great +ranches of the governent.%$

oreover, )*e ru/e -n )*e +ea/ / a)-n - er)-rar an +r-*b)-n e9ua//y 5ana)e

)*a) )*ee e)ra(-rnary re5ee are aa/ab/e -n/y *en ;)*ere n- a++ea/ -r any -)*er

+/an, +eey, an ae9ua)e re5ey n )*e -rnary -ure - /a.@ A reed# is considered

plain, speed# and ade9uate if it will proptl# relieve the petitioner fro the in>urious effects of the

>udgent or rule, order or resolution of the lower court or agenc#.6&

)ection 16 of the assailed 3age rder e;plicitl# provides that an# part# aggrieved +# the 3age

rder a# file an appeal with the *3PC through the R-3PB within 1& da#s fro the pu+lication of

the wage order.61-he 3age rder was pu+lished in a newspaper of general circulation on

Dece+er %, 1$$5.6%

/n this case, petitioner did not avail of the reed# provided +# law. *o appeal to the *3PC was filed

+# the petitioner within 1& calendar da#s fro pu+lication of the 3age rder on Dece+er %, 1$$5.

Petitioner was silent until seven onths later, when it filed a letter'in9uir# on "ul# %4, 1$$ with the

*3PC seeking a clarification on the application of the 3age rder. videntl#, the letter'in9uir# is not

an appeal.
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/t ust also +e noted that the *3PC onl# referred petitioner:s letter'in9uir# to the R-3PB. Petitioner

did not appeal the letter'repl# dated August 1%, 1$$ of the R-3PB to the *3PC. *o direct action

was taken +# the *3PC on the issuance or ipleentation of the 3age rder. Petitioner failed to

invoke the power of the *3PC to review regional wage levels set +# the R-3PB to deterine if

these are in accordance with prescri+ed guidelines. -hus, n-) -n/y a ) 5+r-+er )- 5+/ea )*e

N%P# a +ar)y(re+-nen) n )*e +e))-n be-re )*e #A an )* #-ur), bu) a/- +e))-ner

a/e )- aa/ - )*e +r5ary 8ur)-n - )*e N%P# uner Ar)/e 121 - )*e Lab-r #-e, to

wit0

AR-. 1%1. Powers and =unctions of the Coission. ' -he Coission shall have the following

powers and functions0

; ; ; ;

d! -o review regional wage levels set +# the Regional -ripartite 3ages and Productivit#

Boards to deterine if these are in accordance with prescri+ed guidelines and national

developent plansustice. -heir strict and rigid application, which would result intechnicalities that tend to frustrate, rather than proote su+stantial >ustice, ust alwa#s +e

eschewed.65

As to respondents: su+ission that the ipleentation of the 3age rder can no longer +e

restrained since it has +ecoe fait accopli, the 3age rder having taken effect on "anuar# 1, 1$$

and its ipleenting rules approved on =e+ruar# 14, 1$$, suffice it to state that courts will decide a

9uestion otherwise oot if it is capa+le of repetition #et evading review.6Besides, a case +ecoes
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oot and acadeic onl# when there is no ore actual controvers# +etween the parties or no useful

purpose can +e served in passing upon the erits. )uch circustances do not o+tain in the present

case. -he ipleentation of the 3age rder does not in an# wa# render the case oot and

acadeic, since the issue of the validit# of the wage order su+sists even after its ipleentation and

which has to +e deterined and passed upon to resolve petitioner:s rights and conse9uent

o+ligations therein.

/t is worth# to 9uote the Court:s pronounceents in -an v. Coission on lections,62thus0

=or this onora+le Court to #ield to the respondents: urging that, as there has +een fait accopli,

then this onora+le Court should passivel# accept and accede to the prevailing situation is an

unaccepta+le suggestion. Disissal of the instant petition, as respondents so propose is a

proposition fraught with ischief. Respondents: su+ission will create a dangerous precedent.

)hould this onora+le Court decline now to perfor its dut# of interpreting and indicating what the

law is and should +e, this ight tept again those who strut a+out in the corridors of power to

recklessl# and with ulterior otives coit illegal acts, either +raenl# or stealthil#, confident that

this onora+le Court will a+stain fro entertaining future challenges to their acts if the# anage to

+ring a+out a fait accopli.6

aving disposed of this procedural issue, the Court now coes to the su+stance of the petition.

R.A. *o. 2%2 declared it a polic# of the )tate to rationalie the fi;ing of iniu wages and to

proote productivit#'iproveent and gain'sharing easures to ensure a decent standard of living

for the workers and their failies< to guarantee the rights of la+or to its >ust share in the fruits of

production< to enhance eplo#ent generation in the countr#side through industrial dispersal< and

to allow +usiness and industr# reasona+le returns on investent, e;pansion and growth.6$

/n line with its declared polic#, R.A. *o. 2%24&created the *3PC,41vested with the power to

prescri+e rules and guidelines for the deterination of appropriate iniu wage and productivit#

easures at the regional, provincial or industr# levelsect to the guidelines issued +# the

*3PC.46Pursuant to its wage fi;ing authorit#, the R-3PB a# issue wage orders which set the

dail# iniu wage rates,44+ased on the standards or criteria set +# Article 1%445of the Ea+or

Code.

/n CP,4the Court declared that there are two wa#s of fi;ing the iniu wage0 the @floor'wage@

ethod and the @salar#'ceiling@ ethod. -he @floor'wage@ ethod involves the fi;ing of a

deterinate aount to +e added to the prevailing statutor# iniu wage rates. n the other hand,

in the @salar#'ceiling@ ethod, the wage ad>ustent was to +e applied to eplo#ees receiving a

certain denoinated salar# ceiling. /n other words, workers alread# +eing paid ore than thee;isting iniu wage up to a certain aount stated in the 3age rder! are also to +e given a

wage increase.42

-o illustrate0 under the @floor wage ethod@, it would have +een sufficient if the 3age rder sipl#

set P15.&& as the aount to +e added to the prevailing statutor# iniu wage rates, while in the

@salar#'ceiling ethod@, it would have +een sufficient if the 3age rder states a specific salar#, such

as P%5&.&&, and onl# those earning +elow it shall +e entitled to the salar# increase.
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/n the present case, the R-3PB did not deterine or fi; the iniu wage rate +# the @floor'wage

ethod@ or the @salar#'ceiling ethod@ in issuing the 3age rder. -he R-3PB did not set a wage

level nor a range to which a wage ad>ustent or increase shall +e added. /nstead, it granted an

across'the'+oard wage increase of P15.&& to all eplo#ees and workers of Region %. /n doing so,

the RT%PB eeee ) au)*-r)y by e)enn )*e -erae - )*e %ae Orer )- ae

earner reen 5-re )*an )*e +rea/n 5n5u5 ae ra)e, )*-u) a en-5na)e a/ary

e/n. As correctl# pointed out +# the )(, the 3age rder granted additional +enefits not

conteplated +# R.A. *o. 2%2.

/n no uncertain ters ust it +e stressed that the function of proulgating rules and regulations a#

+e legitiatel# e;ercised onl# for the purpose of carr#ing out the provisions of a law. -he power of

adinistrative agencies is confined to ipleenting the law or putting it into effect. Corollar# to this

guideline is that adinistrative regulation cannot e;tend the law and aend a legislative

enactent.4/t is a;ioatic that the clear letter of the law is controlling and cannot +e aended +# a

ere adinistrative rule issued for its ipleentation.4$/ndeed, adinistrative or e;ecutive acts,

orders, and regulations shall +e valid onl# when the# are not contrar# to the laws or the

Constitution.5&

3here the legislature has delegated to an e;ecutive or adinistrative officers and +oards authorit#

to proulgate rules to carr# out an e;press legislative purpose, the rules of adinistrative officers

and +oards, which have the effect of e;tending, or which conflict with the authorit#'granting statute,

do not represent a valid e;ercise of the rule'aking power +ut constitute an attept +# an

adinistrative +od# to legislate.51

/t has +een said that when the application of an adinistrative issuance odifies e;isting laws or

e;ceeds the intended scope, as in this case, the issuance +ecoes void, not onl# for +eing ultra

vires, +ut also for +eing unreasona+le.5%

-hus, )*e #-ur) n )*a) "e)-n 1, %ae Orer N-. R02(03 - n-ar a ) ran) a

ae nreae )- e5+/-yee earnn 5-re )*an )*e 5n5u5 ae ra)e< and pursuant to thesepara+ilit# clause56of the 3age rder, )ection 1 is declared valid with respect to eplo#ees

earning the prevailing iniu wage rate. 1awphi1.net

Prior to the passage of the 3age rder, the dail# iniu wage rates in Region // was set

at P1&4.&& for the Province of /sa+ela, P1&6.&& for the Province of Caga#an, P1&1.&& for the

Province of *ueva Fica#a, and P1&&.&& for the Provinces of ?uirino and Batanes.54nl#

eplo#ees earning the a+ove'stated iniu wage rates are entitled to the P15.&& andated

increase under the 3age rder.

Although the concoitant effect of the nullit# of the 3age rder to those eplo#ees who have

received the andated increase was not put in issue, this Court shall ake a definitepronounceent thereon to finall# put this case to rest. As ruled +# the Court in Latchme Motoomull v.

ela Pa!,55@the Court will alwa#s strive to settle the entire controvers# in a single proceeding leaving

no root or +ranch to +ear the seeds of future litigation.@5

Appl#ing +# analog#, the Court:s recent pronounceent in Philippine Ports Authorit# v. Coission

on Audit,52thus0
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/n regard to the refund of the disallowed +enefits, this Court holds that petitioners need not refund

the +enefits received +# the +ased on our rulings in "la#uera v. $lcala, e %esus v. Commission

on $udit and &apisanan ng mga Manggagawa sa 'overnment (ervice )nsurance (ystem *&M'+ v.

Commission on $udit.

/n "la#uera,the petitioners, who were officials and eplo#ees of several governent departents

and agencies, were paid incentive +enefits pursuant to *o. %$% and the ni+us Rules

/pleenting Book F of *o. %$%. n "anuar# 6, 1$$6, then President =idel F. Raos issued

Adinistrative rder A! *o. %$ authoriing the grant of productivit# incentive +enefits for the #ear

1$$% in the a;iu aount of P1,&&&. )ection 4 of A *o. %$ directed all departents, offices

and agencies which authoried pa#ent of CH 1$$% Productivit# /ncentive Bonus in e;cess

of P1,&&& to iediatel# cause the refund of the e;cess. Respondent heads of the departents or

agencies of the governent concerned caused the deduction fro petitioners: salaries or allowances

of the aounts needed to cover the overpa#ents. Petitioners therein filed a petition for certiorari

and prohi+ition +efore this Court to prevent respondents therein fro aking further deductions fro

their salaries or allowances. -he Court ruled against the refund, thus0

#-nern, *-eer, )*a) a// )*e +ar)e *ere a)e n -- a)*, e ann-) -un)enane)*e reun - ub8e) nen)e bene) -r )*e year 1==2, ** a5-un) )*e +e))-ner *ae

a/reay reee. Inee, n- indicia- ba a)* an be e)e)e uner )*e a))enan) a)

an ru5)ane. T*e -a/ an *e - -e -nerne bure u* nen)e

bene) n )*e *-ne) be/e )*a) )*e a5-un) en ere ue )- )*e re+en) an )*e /a))er

ae+)e )*e a5e )* ra))ue, -nen) )*a) )*ey r*/y eere u* bene).

-he said ruling in "la#uera was applied in e %esus.

/ne %esus,CA disallowed the pa#ent of allowances and +onuses consisting of representation

and transportation allowance, rice allowance, productivit# incentive +onus, anniversar# +onus, #ear'

end +onus and cash gifts to e+ers of the interimBoard of Directors of the Cat+alogan 3ater

District. -his Court affired the disallowance +ecause petitioners therein were not entitled to othercopensation e;cept for pa#ent ofper diemunder PD *o. 1$. owever, the Court ruled against

the refund of the allowances and +onuses received +# petitioners, thus0

-his ruling in "la#ueraapplies to the instant case. Pe))-ner *ere reee )*e a)-na/

a//-ane an b-nue n -- a)* uner )*e *-ne) be/e )*a) L%!A B-ar Re-/u)-n

N-. 313 au)*-r>e u* +ay5en). A) )*e )5e +e))-ner reee )*e a)-na/ a//-ane

an b-nue, )*e #-ur) *a n-) ye) ee Baybay Water District. Pe))-ner *a n-

?n-/ee )*a) u* +ay5en) a )*-u) /ea/ ba. T*u, ben n -- a)*, +e))-ner

nee n-) reun )*e a//-ane an b-nue )*ey reee bu) a//-e by )*e #OA.

=urther, in&M', this Court applied the ruling in "la#ueraand e %esusin holding that the )ocial/nsurance (roup )/(! personnel of the (overnent )ervice /nsurance )#ste need not refund the

haard pa# received +# the although said +enefit was correctl# disallowed +# CA. -he Court

ruled0

T*e #-ur) *-eer n )*a) )*e &O@ an G"I" -a/ -nerne *- ran)e *a>ar +ay

uner R.A. N-. 730 )- )*e "IG +er-nne/ a)e n -- a)*, n )*e *-ne) be/e )*a) )*ere

a /ea/ ba -r u* ran). T*e "IG +er-nne/ n )urn ae+)e )*e *a>ar +ay bene)

/?ee be/en )*a) )*ey ere en))/e )- u* bene). A) )*a) )5e, ne)*er )*e -nerne


12/12

&O@ an G"I" -a/ n-r )*e "IG +er-nne/ ?ne )*a) )*e ran) - *a>ar +ay )- )*e /a))er

n-) an)-ne by /a. T*u, -//-n )*e ru/n - )*e #-ur) n De Jesus v. Commission

on Audit, an Blaquera v. Alcala, )*e "IG +er-nne/ *- +re-u/y reee *a>ar +ay

uner R.A. N-. 730 nee n-) reun u* bene).

/n the sae vein, the rulings in "la#uera, e %esus and &M' appl# to this case. Petitioners received

the haard dut# pa# and +irthda# cash gift in good faith since the +enefits were authoried +# PPA

)pecial rder *o. 4&2'$2 issued pursuant to PPA eorandu Circular *o. 64'$5 ipleenting

DB *ational Copensation Circular *o. 2, series of 1$$5, and PPA eorandu Circular *o.

%%'$2, respectivel#. Petitioners at that tie had no knowledge that the pa#ent of said +enefits

lacked legal +asis. Being in good faith, petitioners need not refund the +enefits the#

received.5phasis supplied!

eplo#ees, other than iniu wage earners, who received the wage increase andated +# the

3age rder need not refund the wage increase received +# the since the# received the wage

increase in good faith, in the honest +elief that the# are entitled to such wage increase and without

an# knowledge that there was no legal +asis for the sae.

Considering the foregoing, the Court need not delve on the other arguents raised +# the parties.

3R=R, the petition is PAR-/AEEH (RA*-D. -he Decision of the Court of Appeals dated

"ul# 1$, %&&& in CA'(.R. )P *o. 4%%4& is MO&IFIE&. )ection 1 of 3age rder *o. R&%'&6 issued

on cto+er 12, 1$$5 +# the Regional -ripartite 3ages and Productivit# Board for Region //,

-uguegarao, Caga#an is declared 'ALI&insofar as the andated increase applies to eplo#ees

earning the prevailing iniu wage rate at the tie of the passage of the 3age rder

and 'OI& with respect to its application to eplo#ees receiving ore than the prevailing iniu

wage rate at the tie of the passage of the 3age rder.

) RDRD
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