Thursday, February 23, 2017

Funa vs. Duque III, 742 SCRA 166, November 25, 2014

The independence of the Civil Service Commission (CSC) is explicitly mandated under Section 1 of  Article IX-A of the 1987 Constitution. Section 2, Article IX-A of the 1987 Constitution prohibits its Members, during their tenure, from holding any other office or employment.

Facts: On January 11, 2010, then President Arroyo appointed Duque as Chairman of the CSC. The Commission on Appointments confirmed Duque’s appointment on February 3, 2010. Pursuant to EO 864, Duque was designated as a member of the Board of Directors or Trustees of the following government-owned or government- controlled corporations (GOCCs): (a) GSIS; (b) PHILHEALTH;(c) ECC; and (d) HDMF.

Petitioner: Funa, in his capacity as taxpayer, concerned citizen and lawyer, filed the instant petition challenging the constitutionality of EO 864, as well as Section 14, Chapter 3, Title I-A, Book V of Executive Order No. 292 (EO 292), otherwise known as The Administrative Code of 1987, and the designation of Duque as a member of the Board of Directors or Trustees of the GSIS, PHIC, ECC and HDMF for being clear violations of Section 1 and Section 2, Article IX-A of the 1987 Constitution.

Petitioner asserts that these provisions violate the independence of the CSC, which was constitutionally created to be protected from outside influences and political pressures due to the significance of its government functions. Such independence is violated by the fact that the CSC is not a part of the Executive Branch of Government while the concerned GOCCs are considered instrumentalities of the Executive Branch of the Government. In this situation, the President may exercise his power of control over the CSC considering that the GOCCs in which Duque sits as Board member are attached to the Executive Department.

It violates the prohibition imposed upon members of constitutional commissions from holding any other office or employment. A conflict of interest may arise in the event that a Board decision of the GSIS, PHILHEALTH, ECC and HDMF concerning personnel-related matters is elevated to the CSC considering that such GOCCs have original charters, and their employees are governed by CSC laws, rules and regulations. 
 
Respondents: Respondents insist that EO 864 and Section 14, Chapter 3, Title I-A, Book V of EO 292, as well as the charters of the GSIS, PHILHEALTH, ECC and HDMF, are consistent with each other. While the charters of these GOCCs do not provide that CSC Chairman shall be a member of their respective governing Boards, there islikewise no prohibition mentioned under said charters. EO 864, issued in conformity with Section 14, Chapter 3, Title I-A, Book V of EO 292, could not have impliedly amended the charters of the GSIS, PHILHEALTH, ECC and HDMF because the former relates to the law on the CSC while the latter involve the creation and incorporation of the respective GOCCs. As their subject matters differ from each other, the enactment of the subsequent law is not deemed to repeal or amend the charters of the GOCCs, being considered prior laws.

Issue: Does the designation of Duque as member of the Board of Directors or Trustees of the GSIS, PHILHEALTH, ECC and HDMF, in an ex officio capacity, impair the independence of the CSC and violate the constitutional prohibition against the holding of dual or multiple offices for the Members of the Constitutional Commissions?

Held: The Court upholds the constitutionality of Section 14, Chapter 3, Title I-A, Book V of EO 292, but declares unconstitutional EO 864 and the designation of Duque in an ex officio capacity as a member of the Board of Directors or Trustees of the GSIS, PHILHEALTH, ECC and HDMF.

Section 1 and Section 2, Article IX-A of the 1987 Constitution, which provide: Section 1. The Constitutional Commissions, which shall be independent, are the Civil Service Commission, the Commission on Elections, and the Commission on Audit.

Section 2, Article IX-A of the Constitution certain inhibitions and disqualifications upon the Chairmen and members to strengthen their integrity, to wit:
(a) Holding any other office or employment during their tenure;
(b) Engaging in the practice of any profession;
(c) Engaging in the active management or control of any business which in any way may be affected by the functions of his office; and
(d) Being financially interested, directly or indirectly, in any contract with, or in any franchise or privilege granted by the Government, any of its subdivisions, agencies or instrumentalities, including government-owned or – controlled corporations or their subsidiaries. 
 
The issue herein involves the first disqualification abovementioned, which is the disqualification from holding any other office or employment during Duque’s tenure as Chairman of the CSC. The Court finds it imperative to interpret this disqualification in relation to Section 7, paragraph (2), Article IX-B of the Constitution Section 7, paragraph (2),Article IX-B reads:

Section 7.
Unless otherwise allowed by law or the primary functions of his position, no appointive official shall hold any other office or employment in the Government or any subdivision, agency or instrumentality thereof, including government-owned or controlled corporations or their subsidiaries.

Thus, while all other appointive officials in the civil service are allowed to hold other office or employment in the government during their tenure when such is allowed by law or by the primary functions of their positions, members of the Cabinet, their deputies and assistants may do so only when expressly authorized by the Constitution itself. In other words, Section 7, Article IX-B is meant to lay down the general rule applicable to all elective and appointive public officials and employees, while Section 13, Article VII is meant to be the exception applicable only to the President, the Vice-President, Members of the Cabinet, their deputies and assistants.

Since the evident purpose of the framers of the 1987 Constitution is to impose a stricter prohibition on the President, Vice-President, members of the Cabinet, their deputies and assistants with respect to holding multiple offices or employment in the government during their tenure, the exception to this prohibition must be read with equal severity. On its face, the language of Section 13, Article VII is prohibitory so that it must be understood as intended to be a positive and unequivocal negation of the privilege of holding multiple government offices or employment. 
 
Being an appointive public official who does not occupy a Cabinet position (i.e., President, the Vice-President, Members of the Cabinet, their deputies and assistants), Duque was thus covered by the general rule enunciated under Section 7, paragraph (2), Article IX-B. He can hold any other office or employment in the Government during his tenure if such holding is allowed by law or by the primary functions of his position.

The Court also notes that Duque’s designation as member of the governing Boards of the GSIS, PHILHEALTH, ECC and HDMF entitles him to receive per diem, a form of additional compensation that is disallowed by the concept of an ex officio position by virtue of its clear contravention of the proscription set by Section 2, Article IX-A of the 1987 Constitution. This situation goes against the principle behind an ex officio position, and must, therefore, be held unconstitutional.

Apart from violating the prohibition against holding multiple offices, Duque’s designation as member of the governing Boards of the GSIS, PHILHEALTH, ECC and HDMF impairs the independence of the CSC. Under Section 17, Article VII of the Constitution, the President exercises control over all government offices in the Executive Branch. An office that is legally not under the control of the President is not part of the Executive Branch.

The Court holds that all official actions of Duque as a Director or Trustee of the GSIS, PHILHEAL TH, ECC and HDMF, were presumed valid, binding and effective as if he was the officer legally appointed and qualified for the office. This clarification is necessary in order to protect the sanctity and integrity of the dealings by the public with persons whose ostensible authority emanates from the State. Duque's official actions covered by this clarification extend but are not limited to the issuance of Board resolutions and memoranda approving appointments to positions in the concerned GOCCs, promulgation of policies and guidelines on compensation and employee benefits, and adoption of programs to carry out the corporate powers of the GSIS, PHILHEAL TH, ECC and HDMF.

Notes:
  • Power of judicial review in cases otherwise rendered moot and academic by supervening events on the basis of certain recognized exceptions, namely:
(1) there is a grave violation of the Constitution;
(2) the case involves a situation of exceptional character and is of paramount public interest;
(3) the constitutional issue raised requires the formulation of controlling principles to guide the Bench, the Bar and the public; and
(4) the case is capable of repetition yet evading review.
  • A de jure officer is one who is deemed, in all respects, legally appointed and qualified and whose term of office has not expired.
  • A de facto officer is one who derives his appointment from one having colorable authority to appoint, if the office is an appointive office, and whose appointment is valid on its face. He may also be one who is in possession of an office, and is discharging its duties under color of authority, by which is meant authority derived from an appointment, however irregular or informal, so that the incumbent is not a mere volunteer. 
Consequently, the acts of the de facto officer are just as valid for all purposes as those of a de jure officer, in so far as the public or third persons who are interested therein are concerned.

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