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PART IV. POWER OF ADMINISTRATIVE AGENCIES -, ORDER WITH STATEMENT OF …

- - - - POWER TO REGULATE DOES NOT IMPLY POWER TO PROHIBIT
        Although it has the general power to regulate under the Securities Act, this does not imply the authority to prohibit.
      - LIBERAL CONSTRUCTION
        In determining whether a board or commission has a certain power, the authority given should be liberally construed in the light of the purposes for which it was created, and that which is incidentally necessary for a full implementation of the legislative intent. Where the end is required, the appropriate means are deemed given.
        (Matienzo v. Abellera)
        
        LLDA v. CA
        As a regulatory and quasi-judicial body with respect to the pollution cases in the Laguna Lake region, the LLDA’s authority to issue a Cease and Desist order is then implied. Ruling otherwise would make the LLDA a toothless paper agency.
    - - A PRIVILEGE; RESERVED FOR PUBLIC CONTROL AND ADMINISTRATION
        It is a privilege of public concern which cannot be exercised at will and pleasure, but should be reserved for public control and administration, EITHER by the government directly, OR by public agents, under such conditions and regulations as the government may impose on them in the interest of the public.
        (Senator Jaworski v. Pagcor)
        
        CONGRESS PRESCRIBES CONDITIONS OF FRANCHISE
        Furthermore, it is the Congress that prescribes the conditions of the franchise such as its mode of conducting the business and the quality of service to be rendered in clear and unequivocal language.
        
        GRANTEE MUST ABIDE BY TERMS AND CONDITIONS
        The grantee must then abide and strictly adhere to the franchise’s terms and conditions.
- - - - RATIONALE: PUBLIC OFFICERS
        PRESUMED TO HAVE ACTED IN GOOD FAITH
        This is by virtue of the principle that public officers are presumed to have acted in good faith.
- - - - COMPLETENESS & SUFFICIENT STANDARD
        In order to determine the validity of the delegation of legislative power, there are two tests that must be satisfied. (Eastern Shipping Lines v. POEA)
        
        1ST: COMPLETENESS TEST
        The first test is the completeness test which requires that the law must be complete in all its terms and conditions when it leaves the legislature such that when it reaches the delegate, the only thing he will have to do is enforce it.
        
        2ND: SUFFICIENT STANDARD TEST
        The second test is the sufficient standard test which requires that there be guidelines or limitations in the law to map out the boundaries of the delegate’s authority and prevent the delegation from running riot.
        
        The standards or the limits must be *Sufficiently Determinate and Determinable"
        (Abakada v. Ermita)
        
        FORMS OF SUFFICIENT STANDARD
        
        1. EXPRESS
        
        2. IMPLIED
        [Edu v. Ericta, G.R. No. L-32096 (1970)];
        
        3. EMBODIED IN OTHER STATUTES
        Embodied in other statutes on the same matter
        and not necessarily in the same law being
        challenged [Chiongbian v. Orbos, G.R. No. 96754
        (1995)].
        
        GERMANE TO PURPOSES OF
        GOVERNING OR ENABLING STATUTE
        All that may be reasonably demanded is a showing that the delegated legislation consisting of administrative regulations are germane to the general purposes projected by the governing or enabling statute.
        (RABOR v. CSC)
        
        COMPLETENESS & SUFFICIENT STANDARD 2
        There are two tests to determine the validity of the delegation of legislative power.
        (ABAKADA Guro Party List v. Purisima)
        
        COMPLETENESS TEST
        The first is the completeness test which requires that the policy of the law is adequately stated.
        
        SUFFICIENT STANDARDS TEST
        The second is the sufficient standard test which requires that the law provides adequate guidelines or limitations for the implementation of the legislative policy.
    - - Rules and Regulations by AOs CANNOT GO BEYOND LAW
        Rules and regulations issued by administrative officials to implement a law cannot go beyond the terms and provisions of the latter.
        
        ULTRA VIRES DEFINED
        An ultra vires act is an act committed outside the object for which a corporation is created as defined by the law creating it and the powers conferred upon it by law.
        There are two types of ultra vires acts –
        
        ultra vires in a primary sense and
        
        ultra vires in the secondary sense.
        (Landbank v. Cacayuran)
        
        ULTRA VIRES IN A PRIMARY SENSE
        The first kind envisions an act utterly beyond the jurisdiction of a municipal corporation.
        It covers municipal contracts which are entered into beyond the express, implied or inherent powers of an LGU and do not comply with the substantive requirements of the law. As a consequence, these are considered void.
        
        IF BEYOND JURISDICTION = VOID
        
        ULTRA VIRES IN A SECONDARY SENSE
        On the other hand, the second kind is an irregular exercise of a basic power under a legislative grant. Simply put, the act is attended by an irregularity, but it remains to be within the municipality’s power.
        It covers contracts which are entered into by the improper entity and do not comply with the formal requisites of a written contract. These contracts may be ratified.
        
        IF IRREGULARITY = MAY BE RATIFIED
        
        PUBLIC OFFICIALS PERSONALLY ACCOUNTABLE FOR ULTRA VIRES
        Public officials can be held personally accountable for acts claimed to have been performed in relation to the official duties but are in fact ultra vires.
        
        STATE CANNOT BE ESTOPPED BY MISTAKES AND ERRORS OF ITS AGENTS
        Furthermore, the State cannot be estopped by the mistakes and errors of its agents.
      - REGULATIONS MUST BE IN HARMONY WITH PROVISIONS OF THE LAW
        Administrative regulations adopted under legislative authority by a particular department must be in harmony with the provisions of the law, and should be for the sole purpose of carrying into effect its general provisions.
        (China Banking Corporation v. Members of the Board of Trustees)
        
        CANNOT AMEND AN ACT OF CONGRESS
        A rule-making power delegated to an administrative agency is limited and defined by the statute conferring the power. An administrative Order cannot amend an act of Congress.
        
        LIMITED TO CARRYING OUT LAW
        The function of promulgating rules and regulations may be legitimately exercised only for the purpose of carrying out the provisions of a law it aims to execute.
        
        CONSISTENT WITH EXISTING LAWS + ENABLING STATUTE
        Therefore, these rules and regulations must be consistent with the provisions of existing laws, particularly the statute to which the issuance relates.
        
        MUST BE CONFINED TO DETAILS
        The rule-making power must be confined to details for regulating the mode or proceeding to carry into effect the law as it has been enacted.
        
        DIFFERENT PRESCRIPTIVE PERIOD
        A Circular which provides a different prescriptive period from a law is invalid
        
        PENAL REGULATION REQUIRES THAT ITS LAW MADE THE VIOLATION A CRIME
        For an administrative regulation, such as the Circular, to have the force and effect of a penal law, the violation of the administrative regulation must have been made a crime by the delegating law and the penalty for such violation must be provided by the statute itself.
        (Perez v. LPG Refillers)
        
        PENALTY PER CYLINDER = WITHIN LIMITS
        The mere fact that the Circular provides penalties on a per cylinder basis does not in itself run counter to the law [since all that B.P. Blg. 33 prescribes are the minimum and the maximum limits of penalties.]
        
        CANNOT EXTEND THE LAW OR EXPAND ITS COVERAGE
        [Delegate rule-making] power is, however, necessarily limited to what the law provides. Implementing rules and regulations cannot extend the law or expand its coverage, as the power to amend or repeal a statute belongs to the legislature.
        (Gutierrez v. DBM)
        
        ONLY FILLS IN THE DETAILS
        Administrative agencies implement the broad policies laid down in a law by “filling in” only its details.
        
        GERMANE TO OBJECTIVES AND CONFORMS TO STANDARDS OF LAW
        The regulations must be germane to the objectives and purposes of the law and must conform to the standards prescribed by law.
      - ORDINANCE = LAW;
        RESOLUTION = DECLARATIONS
        An ordinance differs from a resolution as the former is considered as law while the latter are merely declarations of the sentiment or opinion of a lawmaking body.
        (LANDBANK v. CACAYURAN)
        
        ORDINANCE = PERMANENT;
        RESOLUTION = TEMPORARY
        Furthermore, an ordinance possesses a general and permanent character while a resolution is temporary in nature.
        
        RESOLUTIONS CANNOT CONFER RIGHTS
        No rights can be conferred by and be inferred from a resolution.
        
        RESOLUTIONS/INTERPRETATIONS
        When an administrative or executive agency renders an opinion or issues a statement of policy, it merely interprets a pre-existing law;
        And the administrative interpretation of the law is at best advisory for it is the function of the courts to determine what the law means.
      - ENFORCEMENT AND COLLECTION OF ESTATE TAX = EXECUTIVE NATURE, NOT LEGISLATIVE
        The enforcement and collection of estate tax is executive in nature based on the fact that the legislature, through the NIRC, ascribed such function to the BIR.
        
        NO COURT APPROVAL NEEDED
        There is nothing in the NIRC and in the pertinent remedial laws which implies the necessity of the probate court’s approval of the State’s claim for taxes before the same can be enforced and collected.
      - ADMINISTRATIVE ISSUANCES:
        LEGISLATIVE vs. INTERPRETATIVE
        Administrative issuances may be distinguished according to their nature and substance as legislative or interpretative.
        (BPI Leasing v. CA)
        
        LEGISLATIVE RULE
        A legislative rule is in the matter of subordinate legislation and is
        designed to implement a primary legislation by providing the details thereof.
        
        GR: MAY NOT RETROACT
        Legislative administrative issuances cannot retroact to the date of the effectivity of the enabling law.
        
        XCPN: EXPRESSLY PROVIDED
        UNLESS THE LEGISLATIVE RULE EXPRESSLY PROVIDES RETROACTIVITY
        
        IF IMPRACTICAL
        As an exception, the retroactive application of a law may not be done if it is impractical.
        (Peralta v. CSC)
        
        INCREASES BURDEN
        substantially increases the burden of those governed
        
        INTERPRETATIVE RULE
        On the other hand, an interpretative rule is
        designed to provide guidelines of the law which the administrative agency is in charge of enforcing.
        
        MAY RETROACT
        Interpretative administrative issuances may be applied retroactively,
        
        ONLY FACILITATES OR RENDER LESS CUMBERSOME IMPLEMENTATION
        Facilitate or render less cumbersome the implementation of the law
      - C. 1 REQUISITES FOR VALIDITY OF ADMINISTRATIVE RULES AND REGULATIONS
        
        EACH AGENCY MUST FILE 3 CERTIFIED COPIES OF EVERY RULE ADOPTED WITH ONAR OF THE UP LAW CENTER
        Doctrine of validity of administrative rules and regulations. Sec. 3, Book VII of the Administrative Code of 1987 expressly requires each agency to file with the ONAR of the UP Law Center three certified copies of every rule adopted by it.
        (Sec. 3 of Book VII of RAC)
        
        ONLY RRs OF PERMANENT CHARACTER NEED BE FILED WITH UPLC AND ONAR
        Only those of general or of permanent character are to be filed.
        
        INTERPRETATIVE AND INTERNAL REGULATIONS
        NEED NOT BE FILED WITH UPLC
        According to the UP Law Center’s guidelines for receiving and publication of rules and regulations, "interpretative regulations and those merely internal in nature, that is, regulating only the personnel of the Administrative agency and not the public," need not be filed with the UP Law Center.
        (Board of Trustees v. Velasco)
        
        INTERPRETATIVE RULE NEEDS NOTHING FURTHER THAN ITS BARE ISSUANCE
        On the other hand, when an administrative rule is merely interpretative in nature, its applicability needs nothing further than its bare issuance for it gives no real consequences more than what the law has already prescribed.
        
        EFFECT OF NON-ISSUANCE:
        INEFFECTIVE AND CANNOT BE ENFORCED
        Administrative issuances which are not published nor filed with the ONAR are ineffective and cannot be enforced.
        
        LEGISLATIVE RULE =
        SUBORDINATE LEGISLATION
        A legislative rule is in the nature of subordinate legislation designed to implement a primary legislation by providing its details.
        
        INCRESEAS BURDEN OF GOVERNED
        It also substantially increases the burden of those governed, thus it behooves the agency to accord the chance to be heard to those who would be directly affected and thereafter be duly informed before the new issuance is given the force and effect of law.
        
        4 REQUISITES FOR VALIDITY OF AN ISSUANCE
        The 4 requirements for the validity of an administrative issuance are as follows:
        
        Its promulgation must be authorized by the legislature.
        
        It must be promulgated in accordance with the prescribed procedure.
        
        It must be within the scope of the authority given by the legislature.
        
        It must be reasonable.
        
        (Dagan v. PRC)
        
        DELAYED ISSUANCE OF DIRECTIVE =
        NOT VOID
        the delayed issuance of the Guidelines of the Directive does not render it void since its validity and effectivity are not dependent on any supplemental Guidelines.
        
        RULE-MAKING POWER IS A DELEGATED LEGISLATIVE POWER
        The rule-making power of a public administrative body is a delegated legislative power which cannot be used to either abridge the authority granted by Congress or the Constitution or to enlarge its power beyond the scope intended.
        
        CONFORM TO AND BE CONSISTENT WITH
        ENABLING STATUTE
        An administrative rule or regulation must conform to and be consistent with the provisions of the enabling statute in order for such to be valid
        
        SPIRIT OF THE LAW
        For administrative rules and regulations to be valid, they must render a policy following the spirit of the law.
        
        REASONABILITY =
        NOT ARBITRARY OR CAPRICIOUS
        It is an axiom in administrative law that administrative authorities should not act arbitrarily nor capriciously in the issuance of rules and regulations. For such rules to be valid, these must be reasonable and fairly adapted to secure the view in end. If it has no reasonable relation to the purpose, then the same shall be declared invalid.
        
        NO NOTICE AND HEARING REQUIRED
        Issuance of rules and regulations in the exercise of an administrative agency of its quasi-legislative power do not require notice and hearing.
        
        RATIO: NO DETERMINATION OF PAST EVENTS
        Prior notice and hearing are not essential to the validity of such rules since there is no determination of past events or facts that have to be established or ascertained.
        
        QUASI-LEGISLATIVE/RULE-MAKING POWER DEFINED
        The quasi-legislative or rule-making power is the power to make rules and regulations within the scope of the statute as a result from delegated legislative powers.
        
        STATUTE > ADMINISTRATIVE ORDER
        In case of conflict between a statute and an administrative order, the former must prevail.
        
        DOCTRINE OF EXHAUSTION DOES
        NOT APPLY TO QUASI-LEGISLATIVE ACTS
        The principle of exhaustion of administrative remedies only applies when the act of the administrative agency concerned was performed pursuant to its quasi-judicial function and not when the assailed act pertains to its rule-making or quasi-legislative power.
        
        NO NEED TO EXHAUST REMEDIES TO
        QUESTION VALIDITY OR CONSTITUTIONALITY
        In questioning the validity or constitutionality of a rule or regulation issued by an administrative agency, a party need not exhaust administrative remedies before going to court.
        
        ACCORDED GREAT RESPECT
        As a matter of policy, the Court accords great respect to the decisions and actions of administrative agencies not only because of the doctrine of separation of powers but also for their presumed knowledge, ability and expertise in the enforcement of the laws.
      - JUDICIAL DECISIONS vs.
        ADMINISTRATIVE DECISIONS
        While judicial decisions applying or interpreting statutes form part of the legal system of the country, administrative decisions do not enjoy this same level of recognition.