THIRD DIVISION
G.R. No. 188952, September 21, 2016
PEÑAFRANCIA SHIPPING CORPORATION AND SANTA CLARA SHIPPING CORPORATION, Petitioners, v. 168 SHIPPING LINES, INC., Respondent.
D E C I S I O N
JARDELEZA, J.:
This case questions the propriety of the dismissal by the Court of Appeals (CA) of a Rule 43 petition for review of a decision of the Maritime Industry Authority (MARINA), for failure to appeal the same to the Secretary of the Department of Transportation and Communications (DOTC), and subsequently, to the Office of the President (OP).
Contrary to petitioners' stance that the Maritime Industry Authority (MARINA) is an independent agency and that it has the final say in the outcome of its adjudication in any contested matter, this Court finds and holds that MARINA is an entity within the Executive Department. It will be noted that Presidential Decree No. 474 (Maritime Industry' Decree of 1974) organized MARINA under the Office of the President. This was modified on July 23, 1979 by Executive Order No. 546 wherein MARINA was made an attached agency of the then Ministry of Transportation and Communications (MOTC) for policy and program coordination. This was confirmed by the Administrative Code of 1987 x x x which explicitly provides that MARINA is an agency attached to the Department of Transportation and Communication (DOTC).Petitioners filed a motion for reconsideration but this was denied.19 Hence, this petition.
Hence, MARINA is not independent of the executive structural organization and the ruling of the MARINA Administrator is subject to the consecutive reviews of the DOTC Secretary and the Office of the President as its administrative superiors in the Executive Department pursuant to the doctrine of exhaustion of administrative remedies which requires an administrative decision to first be appealed to the administrative superiors up to the highest level before it may be elevated to a court of justice for review. Thus, if a remedy within the administrative machinery can still be had by giving the administrative body concerned the opportunity to decide on,the matter that comes within its jurisdiction, then such remedy should be priorly exhausted before the court's judicial power is invoked.
Petitioners' failure to resort to the DOTC Secretary and then the Office of the President, in case of an adverse decision, and the filing of the herein petition before this Court is a premature invocation of the Court's intervention which renders the instant petition without cause of action, hence, dismissible.18 (Underscoring supplied; citations omitted.)
(1) | Whether petitioners committed forum shopping when they filed the moratorium petition; and |
(2) | Whether the decision of the MARINA Board in the exercise of its quasi-judicial function should be appealed first to the DOTC Secretary, and subsequently to the OP, before appeal to the CA. |
Petitioners claim that this provision of the IRR shows that "the appropriate remedy against the adverse ruling of;the MARINA Board is a petition for review to the Honorable Court of Appeals under Rule 43 of the Rules of Court."42 However, as correctly pointed out by the respondent, paragraph 2, Section 1, Rule XV of the IRR applies only to an appeal of the order, ruling, decision or resolution of the MARINA Administrator. There is no procedure for appeal of the decisions of the MARINA Board. Hence, the IRR cannot be the basis for petitioners' appeal. Moreover, no procedure for appeal before the courts is provided by R.A. No. 9295. Rules and regulations issued to implement a law cannot go beyond its terms and provisions.43chanrobleslawRULE XV
APPEALS
Sec. 1. Appeal on Decisions Involving the CPC — Any order, ruling, decision or resolution of the CO/MRO Director/OIC relating to the application for issuance of Entity/Company CPC shall become final and executory fifteen (15) days unless a Motion for Reconsideration is filed within the same period with the CO/MRO Director/OIC concerned after the receipt of a copy thereof by the party affected. The decision of the CO/MRO Director/OIC shall be final and executory unless within the same period an appeal to the MARINA Administrator has been perfected.
The order, ruling decision or resolution of the MARINA Administrator shall be final .and executory within fifteen (15) days unless an administrative appeal is filed with the MARINA Board or petition for judicial review is filed with the Court of Appeals or Supreme Court in accordance with the provisions of the Revised Rules of Court. (Underscoring supplied.)
The above procedure notwithstanding, decisions of the various agencies of government have been appealed to the OP, consistent with the President's power of control over all the executive departments, bureaus, and offices.46 We defined the presidential power of control over the executive branch of government as "the power of [the President] to alter or modify or nullify or set aside what a subordinate officer had done in the performance of his duties and to substitute the judgment of the former with that of the latter."47chanrobleslawBOOK VII - ADMINISTRATIVE PROCEDURE
CHAPTER 4 - ADMINISTRATIVE APPEAL IN CONTESTED CASES
Sec. 19. Appeal.—Unless otherwise provided by law or executive order, an appeal from a final decision of the agency may be taken to the Department head.
Sec. 20. Perfection of Administrative Appeals.—
(1) Administrative appeals under this Chapter shall be perfected within fifteen (15) days after receipt of a copy of the decision complained of by the party adversely affected, by filing with the agency which adjudicated the case a notice of appeal, serving copies thereof upon trie prevailing party and the appellate agency, and paying the required fees. (2) If a motion for reconsideration is denied, the movant shall have the right to perfect his appeal during the remainder of the period for appeal, reckoned from receipt of the resolution of denial. If the decision is reversed on reconsideration, the aggrieved party shall have fifteen (15) days from receipt of the resolution of reversal within which to perfect his appeal. (3) The agency shall, upon perfection of the appeal, transmit the records of the case to the appellate agency.
Sec. 21. Effect of Appeal.—The appeal shall stay the decision appealed from unless otherwise provided by law, or the appellate agency directs execution pending appeal, as it may deem just, considering the nature and circumstances of the case.
Sec. 22. Action on Appeal.—The appellate agency shall review the records of the proceedings and may, on its own initiative or upon motion, receive additional evidence.
Sec. 23. Finality of Decision of Appellate Agency.—In any contested case, the decision of the appellate agency shall become final and executory fifteen (15) days after the receipt by the parties of a copy thereof.x x x
Sec. 25. Judicial Review.—
(1) Agency decisions shall be subject to judicial review in accordance with this chapter and applicable laws. (2) Any party aggrieved or adversely affected by an agency decision may seek judicial review. (3) The action for judicial review may be brought against the agency, or its officers, and all indispensable and necessary parties as defined in the Rules of Court. (4) Appeal from an agency decision shall be perfected by filing with the agency within fifteen (15) days from receipt of a copy thereof a notice of appeal, and with the reviewing court a petition for review of the order. Copies of the petition shall be served upon the agency and all parties of record. The petition shall contain a concise statement of the issues involved and the grounds relied upon for the review, and shall be accompanied with a true copy of the order appealed from, together with copies of such material portions of the records as are referred to therein and other supporting papers. The petition shall be under oath and shall show, by stating the specific material dates, that it was filed within the period fixed in this chapter. (5) The petition for review shall be perfected within fifteen (15) days from receipt of the final administrative decision. One (1) motion for reconsideration may be allowed. If the motion is denied, the movant shall perfect his appeal during the remaining period for appeal reckoned from receipt of the resolution of denial. If the decision is reversed on reconsideration, the appellant shall have fifteen (15) days from receipt of the resolution to perfect his appeal. (6) The review proceeding shall be filed in the court specified by statute or, in the absence thereof, in any court of competent jurisdiction in accordance with the provisions on venue of the Rules of Court. (7) Review shall be made on the basis of the record taken as a whole. The findings of fact of the agency when supported by substantial evidence shall be final except when specifically provided otherwise by law.
R.A. No. 9295, which was enacted on May 3, 2004, provides the jurisdiction, power and duties of the MARINA including the power to:ChanRoblesVirtualawlibraryBOOK IV - THE EXECUTIVE BRANCH
TITLE XV - TRANSPORTATION AND COMMUNICATIONS
CHAPTER 6 - ATTACHED AGENCIES
Sec. 23. Attached Agencies and Corporations.—The following agencies and corporations are attached to the Department: The Philippine National Railways, the Maritime Industry Authority, the Philippine National Lines, the Philippine Aerospace Development Corporation, the Metro Manila Transit Corporation, the Office of Transport Cooperatives, the Philippine Ports Authority, the Philippine Merchant Marine Academy, the Toll Regulatory Board, the Light Rail Transit Authority, the Transport Training Center, the Civil Aeronautics Board, the National Telecommunications Commission and the Manila International Airport Authority.
Section 10. Jurisdiction; Powers; and Duties of MARINA.—The status of the MARINA as an attached agency of the DOTC is crucial to the determination of whether the DOTC has the power to review the decisions of the MARINA Board. Under Section 38, Chapter VII, Book IV of the Administrative Code of 1987,57 there are three kinds of administrative relationship: (1) supervision and control; (2) administrative supervision; and (3) attachment.x x x
(2) Issue certificates of public convenience or any extensions or amendments thereto, authorizing the operation of all kinds, classes and types of vessels in domestic shipping: Provided, That no such certificate shall be valid for a period of more than twenty-five (25) years;x x x
An attached agency has a larger measure of independence from the Department to which it is attached than one which is under departmental supervision and control or administrative supervision. This is borne out by the "lateral relationship" between the Department and the attached agency. The attachment is merely for "policy and program coordination." With respect to administrative matters, the independence of an attached agency from Departmental control and supervision is further reinforced by the fact that even an agency under a Department's administrative supervision is free from Departmental interference with respect to appointments and other personnel actions "in accordance with the decentralization of personnel functions" under the Administrative Code of 1987. Moreover, the Administrative Code explicitly provides that Chapter 8 of Book IV on supervision and control shall not apply to chartered institutions attached to a Department.59 (Emphasis supplied; citations omitted.)Section 39, Chapter VIII, Book IV of the Administrative Code of 1987 expressly states that the chapter on supervision and control shall not apply to chartered institutions or government-owned or controlled corporations attached to the department. Section 39 provides:ChanRoblesVirtualawlibrary
Sec. 39. Secretary's Authority.—Reading Section 39 together with Section 38, the decision of an attached agency such as the MARINA in the exercise of its quasi-judicial function is not subject to review by the department. Section 39 makes it clear that the supervision and control exercised by the department over agencies under it with respect to matters including the exercise of discretion (performance of quasi-judicial function) do not apply to attached agencies. Thus, in this respect, petitioners are correct in saying that the decisions of the MARINA are not subject to the review of the DOTC Secretary.
(1) The Secretary shall have supervision and control over the bureaus, offices, and agencies under him, subject to the following guidelines:x x x (2) This Chapter shall not apply to chartered institutions or government-owned or controlled corporations attached to the department.
x x x The term ex-officio means "from office; by virtue of office." It refers to an "authority derived from official character merely, not expressly conferred upon the individual character, but rather annexed to the official position." Ex-officio likewise denotes an "act done in an official character, or as a consequence of office, and without any other appointment or authority than that conferred by the office." An ex-officio member of a board is one who is a member by virtue of his title to a certain office, and without further wan-ant or appointment. x x x66chanroblesvirtuallawlibraryIn Manalang-Demigillo v. Trade and Investment Development Corporation of the Philippines67 (TIDCORP), we: held that the doctrine of qualified political agency cannot be extended to the acts of the Board of Directors of the TIDCORP, though some of its members are cabinet members. We clarified that even if the Secretary of Finance, the Secretary of Trade and Industry, the Governor of the Bangko Sentral ng Pilipinas, the Director-General of the National Economic and Development Authority, and the Chairman of the Philippine Overseas Construction Board are members of the cabinet, they sat on the TIDCORP Board by virtue of Presidential Decree No. 1080, as amended by R.A. No. 8494 and by reason of their office or function, or in their ex officio capacity, and not because of their direct appointment to the Board by the President. Thus, they were acting as members of the Board, and not as alter egos of the President. We said:ChanRoblesVirtualawlibrary
But the doctrine of qualified political agency could not be extended to the acts of the Board of Directors of TIDCORP despite some of its members being themselves the appointees of the President to the Cabinet. Under Section 10 of Presidential Decree No. 1080, as further amended by Section 6 of Republic Act No. 8494, the five ex officio members were the Secretary of Finance, the Secretary of Trade and Industry, the Governor of the Bangko Sentral ng Pilipinas, the Director-General of the National Economic and Development Authority, and the Chairman of the Philippine Overseas Construction Board, while the four other members of the Board were the three from the private sector (at least one of whom should come from the export community), who were elected by the ex officio members of the Board for a term of not more than two consecutive years, and the President of TIDCORP who was concurrently the Vice-Chairman of the Board. Such Cabinet members sat on the Board of Directors of TIDCORP ex officio, or by reason of their office or function, not because of their direct appointment to the Board by the President. Evidently, it was the law, not the President, that sat them in the Board.In this case, the DOTC Secretary and the Executive Secretary are ex officio members of the MARINA Board by yirtue of Section 7 of Presidential Decree No. 474, as amended, which provides:ChanRoblesVirtualawlibrary
Under the circumstances, when the members of the Board of Directors effected the assailed 2002 reorganization, they were acting as the responsible members of the Board of Directors of TIDCORP constituted pursuant to Presidential Decree No. 1080, as amended by Republic Act No. 8494, not as the alter egos of the President. We cannot stretch the application of a doctrine that already delegates an enormous amount of power. Also, it is settled that the delegation of power is not to be lightly inferred.68chanroblesvirtuallawlibrary
Sec. 7. Composition and Organization.—The Board shall be composed of eight members as follows: The Secretary of Trade, the Secretary of Public Works, Transportation and Communications, the Secretary of National Defense, the Executive Secretary, the Chairman of the Board of Investments, the Chairman of the Development Bank of the Philippines, the Chairman of the Board of Transportation and the Maritime Administrator. The Chairman of the Board shall be appointed by the President of the Philippines from among its members.69 x x x (Emphasis supplied.)Following our ruling in Manalang-Demegillo, the actions of the DOTC Secretary and the Executive Secretary, as ex officio members of the MARINA Board: were made not in their capacity as alter egos of the President. As such, an appeal to the OP is still warranted. If petitioners are still dissatisfied with the decision of the OP, then it would be the proper time to file a petition for review under Rule 43 with the CA.
Endnotes:
1 Docketed as LMRO Case No. 07-027. Rollo, pp. 425-434.
2Id. at 427-429.
3Id. at 139-152.
4Id. at 143-147.
5Id. at 147.
6Id. at 147-150.
7 The Domestic Shipping Development Act of 2004.
8Rollo, pp. 130-138.
9Id. at 155-156.
10Id. at 157-158.
11Id. at 171-183.
12Id. at 184-187.
13 Cited in the Appellant's Memorandum filed before the MARINA, id. at 198.
14Id. at 108-121.
15Id. at 122-127.
16Id. at 35-36.
17Id. at 62-64; penned by Associate Justice Portia Aliño-Hormachuelos with Associate Justices Jose Catral Mendoza (now Member of this Court) and Ramon M. Bato, Jr., concurring.
18Id. at 62-63.
19Id. at 67-68.
20Id. at 37-40, citing San Pablo v. Sta. Clara Shipping Corporation, CA-G.R. SP No. 86811, July 31, 2006, id. at 704-715.
21Id. at 38, citing Republic v. Damayan ng Purok 14, Inc., G.R. No. 143135, April 4, 2003, 400 SCRA 664 and Sy v. Commission on Settlement of Land Problems, G.R. No. 140903, September 12, 2001 365 SCRA 49.
22Id. at 42.
23Id. at 49.
24Id. at 49-50.
25cralawred Id. at 44-45.
26Id. at 741-765.
27Id. at 759-760.
28Id. at 761.
29Id. at 751-752.
30Id. at 746.
31Id. at 746-747.
32Id. at 748-755.
33 See Manifestation/Submission (with Leave of Court) filed on June 7, 2010, id. at 774-784.
34Id. at 785-793.
35Id. at 774-775.
36Id. at 796- 807.
37Heirs of Marcelo Sotto v. Palicte, G.R. No. 159691, February 17, 2014, 716 SCRA 175, 178, citing Chua v. Metropolitan Bank & Trust Company, G.R. No. 182311, August 19, 2009, 596 SCRA 524, 535.
38Id. at 178-179.
39Rollo, pp. 790-791.
40 Rules And Regulations Implementing Republic Act No. 9295, Entitled "An Act Promoting The Development Of Philippine Domestic Shipping, Shipbuilding, And Ship Repair And Ship Breaking, Ordaining Reforms In Government Policies Towards Shipping In' The Philippines, And For Other Purposes" (2004).
41Rollo, pp. 45-46.
42Id. at 46.
43China Banking Corporation v. Members of the Board of Trustees, Home Development Mutual Fund, G.R. No. 131787, May 19, 1999, 307 SCRA 443, 459.
44 The Judiciary Reorganization Act of 1980.
45Monetary Board v. Philippine Veterans Bank, G.R. No. 189571, January 21, 2015, 746 SCRA 508, 517-518.
46 Section 1, Chapter I, Title I, Book III of the Administrative Code of 1987.
47Carpio v. Executive Secretary, G.R. No. 96409 February 14, 1992, 206 SCRA 290, 295 citing Mondano v. Silvosa, 97 Phil. 143, 148 (1955).
48Land Car, Inc. v. Bachelor Express, Inc., G.R. No. 154377, December 8, 2003, 417 SCRA 307, 312.
49University of the Philippines v. Catungal, Jr., G.R. No. 121863, May 5, 1997, 272 SCRA 221, 240-241.
50 The exceptions include:ChanRoblesVirtualawlibraryEstrada v. Court of Appeals, G.R. No. 137862, November 11, 2004, 442 SCRA 117, 127-128.
(1) when there is a violation of due process, (2) when theissue involved is purely a legal question, (3) when the administrative action is patently illegal amounting to lack or excess of jurisdiction, (4) when there is estoppel on the part of the administrative agency concerned, (5) when there is irreparable injury, (6) when the respondent is a department secretary whose acts as an alter ego of the President bears [sic] the implied and assumed approval of the latter, (7) when to require exhaustion of administrative remedies would be unreasonable, (8) when it would amount to a nullification of a claim, (9) when the subject matter is a private land in land case proceedings, (10) when thesrule does not provide a plain, speedy and adequate remedy, (11) when there are circumstances indicating the urgency of judicial intervention, (12) when no administrative review is provided by law, (13) where the rule of qualified political agency applies, and (14) when the issue of non-exhaustion of administrative remedies has been rendered moot.
51 Providing For The Reorganization Of The Maritime Functions. In The Philippines, Creating The Maritime Industry Authority, And For Other Purposes (1974).
52 Sec. 4, Presidential Decree No. 474.
53 Creating A Ministry Of Public Works And A Ministry Of Transportation And Communications (1979).
54 Sec. 20, Executive Order No. 546.
55 Establishing The Land Transportation/Commission In The Ministry Of Transportation And Communications, And For Other Purposes (1985).
56 Sec. 13, Executive Order No. 1011.
57 Sec. 38. Definition of Administrative Relationships.—Unless otherwise expressly stated in the Code or in other laws defining the special relationships of particular agencies, administrative relationships shall be categorized and defined as follows:
chanRoblesvirtualLawlibrary
(1) Supervision and Control.—Supervision and control shall include authority to act directly whenever a specific function is entrusted by law or regulation to a subordinate; direct the performance of duty; restrain the commission of acts; review, approve, reverse or modify acts and decisions of subordinate officials or units; determine priorities in the execution of plans and programs; and prescribe standards, guidelines, plans and programs. Unless a different meaning is explicitly provided in the specific law governing the relationship of particular agencies, the word "control" shall encompass supervision and control as defined in this paragraph. (2) Administrative Supervision.— (a) Administrative supervision which shall govern the administrative relationship between a department or its equivalent and regulatory agencies or other agencies as may be provided by law, shall be limited to the authority of the department or its equivalent to generally oversee the operations of such agencies and to insure that they are managed effectively, efficiently and economically but without interference with day-to-day activities; or require the submission of reports and cause the conduct of management audit, performance evaluation and inspection to determine compliance with policies, standards and guidelines of the department; to take such action as may be necessary for the proper performance of official functions, including rectification of violations, abuses ;and other forms of maladministration; and to review and pass upon budget proposals of such agencies but may not increase or add to them; (b) Such authority shall not, however, extend to: (1) appointments and other personnel actions in accordance with the decentralization of personnel functions under the Code, except when appeal is made from an action of the appointing authority, in which case the appeal shall be initially sent to the department or its equivalent, subject to appeal in accordance with law; (2) contracts entered into by the agency in the pursuit of its objectives, the review of which and other procedures related thereto shall be governed by appropriate laws, rules and regulations; and (3) the power to review, reverse, revise, or modify the decisions of regulatory agencies in the exercise of their regulatory or quasi-judicial functions; and (c) Unless a different meaning is explicitly provided in the specific law governing the relationship of particular agencies, the word "supervision" shall encompass administrative supervision as defined in this paragraph. (3) Attachment— (a) This refers to the lateral relationship between the department or its equivalent and the attached agency or corporation for purposes of policy and program coordination. The coordination may be accomplished by having the department represented in the governing board of the attached agency or corporation, either as chairman or as a member, with or without voting rights, if this is permitted by the charter; having the attached corporation or agency comply with a system of periodic reporting which shall reflect the progress of programs and projects; and having the department or its equivalent provide general policies through its representative in the board, which shall serve as the framework for the internal policies of the attached corporation or agency; (b) Matters of day-to-day administration or all those pertaining to internal operations shall be left to the discretion or judgment of the executive officer of the agency or corporation. In the event that the Secretary and the head of the board or the attached agency or corporation strongly disagree on the interpretation and application of policies, and the Secretary is unable to resolve the disagreement, he shall bring the matter to the President for resolution and direction; (c) Government-owned or controlled corporations attached to a department shall submit to the Secretary concerned their audited financial statements within sixty (60) days after the close of the fiscal year; and (d) Pending submission of the required financial statements, the corporation shall continue to operate on the basis of the preceding year's budget until the financial statements shall have been submitted. Should any government-owned or controlled corporation incur an operation deficit at the close of its fiscal year, it shall be subject to administrative supervision of the department; and the corporation's operating and capital budget shall be subject to the department's examination, review, modification and approval. (Emphasis supplied.)
58 G.R. No. 97149, March 31, 1992, 207 SCRA 689.
59Id. at 697.
60 G.R. No. 175787, February 4, 2009, 578 SCRA 113.
61 Prescribing Rules and Regulations Governing Appeals to the Office of the President of the Philippines (1987). This has been repealed by Administrative Order No. 22, Prescribing Rules and Regulations Governing Appeals to the Office of the President of the Philippines (2011).
62 Section 1 of Administrative Order No. 18, reads:
chanRoblesvirtualLawlibrarySec. 1. Unless otherwise governed by special laws, an appeal to the Office of the President shall be taken within thirty (30) days from the receipt by the aggrieved party of the decision/resolution/order complained of or appealed from. x x x (Emphasis supplied).
Section 1 of Administrative Order No. 22, reads:
chanRoblesvirtualLawlibrarySec. 1. Period to appeal. Unless otherwise provided by special law, an appeal to the Office of the President shall be taken fifteen (15) days from notice of the aggrieved party of the decision/resolution/order appealed from, or of the denial, in part or in whole, of a motion for reconsideration duly filed in accordance with the governing law of the department or agency concerned.
63Manalang-Demigillo v. Trade and Investment Development Corporation of the Philippines, G.R. No. 168613, March 5, 2013, 692 SCRA 359, 373-374.
64Id. at 374-375.
65 G.R. No. 83896, February 22, 1991, 194 SCRA 317.
66Id. at 333.
67 G.R. No. 168613, March 5, 2013, 692 SCRA 359.
68Id. at 374-376.
69 The composition of the MARINA Board has been amended by Section 1, Executive Order No. 783, promulgated on March 16, 1982, to include the Philippine Ports Authority General Manager as member of the MARINA Board. Section 5, R.A. No. 10635, promulgated on March 13, 2014, further amended its composition by including the Commandant of the Philippine Coast Guard in lieu of the Secretary of the National Defense.